GROUP

BANCA INTERMOBILIARE DI INVESTIMENTI E GESTIONI S.p.A.

CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS AS OF 31 DECEMBER 2010 29TH YEAR BIM GROUP COMPANIES

Banca Intermobiliare di Investimenti e Gestioni S.p.a. Torino: 10121 - Via Gramsci, 7 Tel. 011/08.28.1 - Fax 011/08.28.800 www.bancaintermobiliare.com - Email: [email protected]

Banca IntermoBIlIare dI InvestImentI e GestIonI suIsse S.A. Lugano: 6900 - Contrada Sassello, 10 SUISSE Tel. 0041/91/9136666 - Fax 0041/91/9136667 www.bimsuisse.com - Email: [email protected]

Banca Ipibi Financial Advisory S.p.A. Milano: 20123 - Via Meravigli, 2

Tel +39.02/85906. 1 - Fax +39.02/85906.280 BANCA FINANCIAL ADVISORY www.bancaipibi.it - Email: [email protected] GRUPPO BANCA INTERMOBILIARE symPhonIa sGr S.p.A. Milano: 20121 - Corso Matteotti, 5 Tel. 02/777071 - Fax 02/77707350 www.symphonia.it - Email: [email protected]

BIm FIducIarIa S.p.A. Torino: 10121 - Via Gramsci, 7 Tel 011/08.28.1 - Fax 011/08.28.852 Email: [email protected]

BIm vIta S.p.A. Torino: 10121 - Via Gramsci, 7 Tel. 011/0828.411 - Fax 011/08.28.800 www.bimvita.it - Email: [email protected]

BIm Insurance Brokers S.p.A. BIM INSURANCE BROKERS Torino: 10121 - Via Gramsci, 7 Lloyd’s Correspondent Tel 011/08.28.416 - Fax 011/08.28.823 www.bimbrokers.it - Email: [email protected]

BIm ImmoBIlIare S.r.l. Torino: 10121 - Via Gramsci, 7 Tel 011/08.28.1 - Fax 011/08.28.852

P atIo luGano S.A. Lugano: 6900 - Contrada di Sassello, 10 Tel. 0041/91/9136666 - Fax 0041/91/9136667

Corporate website www.bancaintermobiliare.com Investor relations: [email protected] Telephone, Banca Intermobiliare: +39 011 - 0828.1 GROUP

BFINANCIALANCA YEAR 2010 INTERMOBILIARE DI INVESTIMENTI E GESTIONI S.p.A.

CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 29th FINANCIAL YEAR

Registered Office: Via Gramsci, 7 10121 Turin

Share capital e 156,209,463 fully paid-up

Bank Code no. 3043.7 Banks Register no. 5319

Turin company register no. 02751170016

Chamber of commerce for industry agriculture and handicrafts of Turin, listed under Economic Administrative Index no. REA 600548 Tax Code/ VAT number 02751170016

Subscribing to the National Compensation Fund and to the Deposit Protection Fund

A MEMBER OF THE VENETO BANCA BANKIKG GROUP

(Registered with the Register of Banking Groups on 8/06/1992 code no. 5035.1) and subject to Management and Coordination Activities of Veneto Banca S.c.p.a. FINANCIAL YEAR 2010 CONTENTS BANCA INTERMOBILIARE GROUP

CONSOLIDATED MANAGEMENT REPORT 5 Highlights 6 The macroeconomic scenario 9 Main group information 13 Reclassified consolidated financial statements 15 Summary of results and management performance 20 Events after the financial statements reporting date 22 Business outlook 22 Operating figures and balance sheet data 23 Consolidated financial results 34 Results of investments 41 Information on risks and factors influencing profitability 44 Development and organisation activities 47 Management and auditing activities 49 Other aspects 51

CONSOLIDATED FINANCIAL STATEMENTS AT 31.12.2010 53 Consolidated balance sheet 54 Consolidated income statement 56 Consolidated statement of comprehensive income 57 Consolidated statement of changes in equity 58 Consolidated cash flow statement 60

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 63 Part A - Accounting policies 64 Part B - Information on the consolidated balance sheet 81 Part C - Information on the consolidated income statement 119 Part D - Consolidated statement of comprehensive income 135 Part E - Information on risks and related hedging policies 136 Part F - Information on consolidated equity 185 Part G - Business combinations regarding companies or company divisions 191 Part H - Related parties transactions 192 Part I - Share-based payment agreements 195 Part L - Segment operating 196

REPORTS ON CONSOLIDATED FINANCIAL STATEMENTS 199 Certification of the consolidated financial statements in accordance with art. 81-ter of CONSOB Regulation no. 11971 of 14 May 1999, as amended and supplemented 200 Statutory auditors’ report on the consolidated and separate financial statements 202 Independent auditors’ report on the consolidated financial statements 210

ANNEXES TO THE CONSOLIDATED FINANCIAL STATEMENTS 213 Annex 1 - Independent auditors’ fees related to Consolidated financial statements 214 FINANCIAL YEAR 2010 CONTENTS BANCA INTERMOBILIARE S.p.A.

SEPARATE MANAGEMENT REPORT 217 Parent bank’s main data 218 Reclassified separate financial statements 220 Operating figures and balance sheet data 222 Financial results 231 Other aspects 237 Events after the financial statements reporting date 237 Business outlook 238 Project for allocating profit of the year 238

SEPARATE FINANCIAL STATEMENTS AT 31.12.2010 239 Separate balance sheet 240 Separate income statement 242 Separate statement of comprehensive income 243 Separate statement of changes in equity 244 Separate cash flow statement 246

SEPARATE NOTES TO THE FINANCIAL STATEMENTS 249 Part A - Accounting policies 250 Part B - Information on the balance sheet 266 Part C - Information on the income statement 297 Part D - Statement of comprehensive income 312 Part E - Information on risks and related hedging policies 313 Part F - Information on equity 347 Part G - Business combinations regarding companies or business branches 351 Part H - Related party transactions 351 Part I - Share-based payment agreements 356 Part L - Segment operating 357

REPORTS ON SEPARATE FINANCIAL STATEMENTS 361 Certificate of separate financial statements pursuant to art. 81-ter of CONSOB Regulation no. 11971 of 14 May 1999 as supplemented and amended 362 Independent auditors’ report on the separate financial statements 364

ANNEXES TO SEPARATE FINANCIAL STATEMENTS 367 Annex 2 - Independent auditors’ fees related to the separate financial statements 368 NATIONAL NETWORK BANCA INTERMOBILIARE BRANCHES

Turin head office and branch 10121, Via Gramsci, 7 Alba branch 12051, Via Pierino Belli,1 Arzignano branch 36071, Corso Garibaldi, 1 Asti branch 14100, Via Bonzanigo, 34 Bassano del Grappa branch 36061, Via Bellavitis, 6 Bergamo branch 24121, C/so Vittorio Emanuele II, 8 Bologna branch 40124, Via de' Pignattari, 1 Chivasso branch 10034, Via Teodoro II, 2 Cuneo branch 12100, Corso Nizza, 2 Florence branch 50132, Via della Robbia, 24/26 Genoa branch 16121, Via XX Settembre, 31/4 Ivrea branch 10015, Via Palestro, 16 Milan branch 20123, Via Meravigli, 4 Milan branch 20121, Corso Matteotti, 5 Modena branch 41100, Corso Cavour, 36 Naples branch 80133, Via Medina, 40 Padua branch 35137, Via dei Borromeo, 16 Pavia branch 27100, Piazza Belli, 9 Pesaro branch 61100, Via Giusti, 6 Piacenza branch 29100, Via San Siro, 18 Pordenone branch 33170, Corso V. Emanuele II, 21/G Rome branch 00198, Via Donizetti, 14 Savona branch 17100, Via Paleocapa, 16/3 Thiene branch 36016, Via Montegrappa, 6/L Treviso branch 31100, Piazza Sant’Andrea, 6 Varese branch 21100, Via Leopardi, 1 Venice branch 30124, Palazzo Ziani - San Marco, 4934 Verona branch 37122, Corso Porta Nuova, 101 Vicenza branch 36100, Via Contrà Ponte San Michele, 3 FINANCIAL YEAR 2010

CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2010

CONSOLIDATED MANAGEMENT REPORT FINANCIAL YEAR 2010

Highlights

Group structure Offices held within the Parent Company

The Board of Directors The Board of Directors of Banca Intermobiliare, appointed by the shareholder meeting of 23/04/2010 and remaining in office until the financial statements at 31/12/2012 are approved, is currently composed as follows:

Roberto RUOZI Chairman Independent Flavio TRINCA Vice Chairman Non-executive Pietro D’AGUI’ Chief Executive Officer Executive Franco ANTIGA Director Non-executive Angelo CECCATO Director Non-executive Vincenzo CONSOLI Director Non-executive Matteo CORDERO DI MONTEZemolo director Non-executive Mauro CORTESE Director Independent Massimo MALVESTIO Director Non-executive Giuseppe SANTONOCITO Director Non-executive Luigi TERZOLI Director Non-executive

Board of Statutory Auditors The Board of Statutory Auditors of Banca Intermobiliare, appointed by the shareholder meeting of 25/06/2010 and remaining in office until the financial statements at 31/12/2012 are approved, is currently composed as follows:

Paolo DE POI Chairman Paolo ANDOLFATO Statutory Auditor Roberto D’IMPERIO Statutory Auditor Stefano BERTARELLI Alternate Auditor Marco PEZZETTA Alternate Auditor CONSOLIDATED MANAGEMENT REPORT

Independent auditors Deloitte & Touche S.p.A. is responsible for auditing the financial statements and the consolidated financial statements until 31/12/2013.

Director in charge Mr. Mauro VALESANI, Operations and Administration Manager of the Banca Intermobiliare Group, is in charge of drawing up corporate accounting documents, appointed by the BIM Board of Directors with the opinion of the Board of Statutory Auditors pursuant to Article 154 bis of Legislative Decree 58/1998.

6 • Consolidated Management Report FINANCIAL YEAR 2010

Group structure

Veneto Banca, through a merger by incorporation of Cofito (majority shareholder of Banca Intermobiliare) concluded on 18 February 2011 and registered on the Treviso and Turin Company Registers on 25 February 2011, acquired legal control of the Issuer, Banca Intermobiliare. Following the aforementioned acquisition by Veneto Banca, the legal requirements for a compulsory takeover bid were met, pursuant to articles 102 and 106, paragraph 1 of the Italian Consolidated Law on Finance (TUF), relating to residual outstanding BIM shares. The Bidder shall give each offer participant a cash price amounting to 4.25 Euros for each share. As it is a compulsory takeover bid, the Price has been calculated in accordance with art. 106, paragraph 2 of the Consolidated Law on Finance (TUF) and represents the highest price the Bidder paid to acquire the Issuer's shares in the twelve months preceding this notice. Veneto Banca intends to keep BIM shares listed on the Italian Telematic Stock Exchange, therefore the company will reinstate the outstanding shares if, as a result of the above offer, it should exceed an equity interest of 90% in BIM share capital.

* * *

It should be noted that on 5 April 2010, Cofito’s shareholders, namely the Scanferlin, D'Aguì and Giovannove families, had agreed with Veneto Banca - which already held 40% of Cofito’s share capital - on the acquisition of Bim by Veneto Banca and Bim’s subsequent merger into the Veneto Banca Group, through merger by incorporation of Cofito into Veneto Banca.

Following the stipulation of the aforementioned agreement, the BIM Shareholders’ meeting held on 23 April 2010 renewed the Board of Directors - as the term of office had expired - for the years 2010-2012, approving a list of candidates proposed by the shareholder Cofito and agreeing on a total of eleven board members, the majority of whom were appointed by the Veneto Banca Group.

BANCA INTERMOBILIARE DI INVESTIMENTI E GESTIONI S.p.A. Group leader

BANCA IPIBI symphonia BIM FIDUCIARIA BIM insurance BIM immobiliare CONSOLIDATED MANAGEMENT REPORT S.p.A. SGR S.p.A. S.p.A. broker S.p.A. Srl 67,28% 100% 100% 51% 100%

BIM SUISSE BIM VITA immobiliare D S.A. S.p.A. Srl 100% 50% 100%

PATIO LUGANO S.A. 100%

BANKS ASSET MANAGEMENT TRUST SERVICES INSURANCE COMPANIES REAL ESTATE

Consolidated Management Report • 7 FINANCIAL YEAR 2010

The Group structure is the following:

 Banca Intermobiliare S.p.A., the Parent Company, fully owns the share capital of the following companies: Banca Intermobiliare di Investimenti e Gestioni (Suisse) S.A., Symphonia SGR S.p.A., Bim Fiduciaria S.p.A., Bim Immobiliare S.r.l. and Immobiliare D S.r.l.  Banca Ipibi Financial Advisory S.p.A., is 67.283% owned by Banca Intermobiliare S.p.A. with the remaining share of 32.717% owned by third parties.  Bim Vita S.p.A. is jointly controlled by Banca Intermobiliare S.p.A. (50%) and Fondiaria-Sai S.p.A. (50%).  Bim Insurance Brokers S.p.A., is owned by Banca Intermobiliare S.p.A. (51%) and third parties (49%).  patio Lugano S.A. (real estate company), is a wholly-owned subsidiary (100%) of Banca Intermobiliare di Investimenti e Gestioni (Suisse) S.A.

Scope of consolidation

Banca Intermobiliare Banking Group Parent company: • Banca Intermobiliare di Investimenti e Gestioni S.p.A. Wholly-owned subsidiaries (100%), fully consolidated: • Banca Intermobiliare di Investimenti e Gestioni (Suisse) S.A. • symphonia SGR S.p.A. • Bim Fiduciaria S.p.A. • patio Lugano S.A. Partially-owned subsidiary (less than 100%), fully consolidated: • Banca Ipibi Financial Advisory S.p.A

Shareholdings outside the Banking Group Wholly-owned subsidiaries (100%), fully consolidated: • Bim Immobiliare S.r.l. • immobiliare D S.r.l. Partially-owned subsidiaries (less than 100%), fully consolidated: • Bim Insurance Brokers S.p.A. Affiliated companies valued using the equity method: • Bim Vita S.p.A. CONSOLIDATED MANAGEMENT REPORT

Effective 01/01/2010, the full investment in Bim Alternative Investments SGR S.p.A. was subject to a merger by incorporation into Symphonia SGR S.p.A. Immobiliare D S.r.l., acquired as a result of credit collection operations at the end of 2009 and classified, up to the interim management report at 30/09/2010, as an asset available for sale according to IFRS 5, was reclassified as a majority holding and fully consolidated.

8 • Consolidated Management Report FINANCIAL YEAR 2010

The macroeconomic scenario

The trend of financial markets was positive throughout the year, reflecting a generally encouraging macroeconomic and corporate picture, albeit characterized by geographically different dynamics and results: the global economic recovery has confirmed a clear gap between the growth profiles of industrialised countries and those of emerging countries. The pace of recovery of industrialised countries was slower and hindered by long-term structural factors which were aggravated during the recent financial crisis by the heavy and widespread reliance on public debt.H owever, the growth profile of emerging countries was much stronger, this year driven mainly byC hina and India with the local monetary authorities which, in light of this very positive movement, are working to prevent their respective economies from overheating and increasing in inflation. From an economic point of view, 2010 closed with an extremely positive global growth, estimated by the IMF to be at 5%. Developed economies recorded an average growth of 3%, with the best results recorded in Japan (+4.3%) and Germany (+3.6%) and with Spain recording the only negative result (-0.2%). However, the average growth of emerging countries has been much stronger and has been estimated at 7.1%, due to the decisive contribution of China and India, growing by 10.3% and 9.7%, respectively. The different growth dynamic between emerging and industrialised countries, as well as the presence of structural deflationary factors in the latter, such as high unemployment rates and the poor use of production plants (in other words, a negative output gap), as well as the implementation of tax reforms to improve public finances, should continue to create differentiated inflation profiles between the two areas.M oreover, in Emerging Countries the increase in some raw materials, mainly energy and food, caused a sharp rise in consumer prices. For 2010, IMF’s latest estimates forecast a 1.5% inflation rate in industrialized countries, while the percentage for the emerging countries is estimated at 6.3%. The different growth and inflation dynamics have caused the definition of different monetary policies between the central Banks. In most industrialized countries, with the exception of some countries such as Australia and Canada, the official rates remain stable at the minimum levels reached during the 2008 financial crisis (the so calledIRP Z policy). In the light of the difficult recovery in some macroeconomic areas, such as the employment rate, the desire to keep rates at these levels for a longer period was reaffirmed several times during the year, in particular by theFED . However, in emerging countries, the presence of strong and increasing inflation led to the adoption of restrictive monetary policies with an overall increase in official interest rates.I n regard to unconventional monetary policies (the so-called “quantitative easing” approach), the major central banks in industrialized countries, albeit for different purposes, decided to postpone their exit strategy, i.e. withdrawing extraordinary measures for monetary stimulation introduced during the 2008 financial and economic crisis which at first was forecast for 2010.I n regard to the FED,

the decision was mainly motivated by a desire to support economic growth, which was still considered to be too CONSOLIDATED MANAGEMENT REPORT weak and uncertain. To this aim, extraordinary monetary policy measures were reintroduced for a total amount of 600 billion dollars to be carried out until June 2011, reinvesting principal at maturity of the MBS bonds acquired during the 2008 crisis in long term government bonds, in order to inject more cash flow into the economic system. In the case of BOJ (the Japanese Central Bank) the decision to reintroduce quantitative measures was made with the dual aim of supporting a worsening economy in the second half of the year and trying to weaken the yen with the introduction, among other quantitative measures, of a temporary fund for about 60 billion dollars to purchase long term government bonds, corporate bonds, commercial papers and other financial instruments.F inally, in the case of the ECB, the extraordinary monetary policy measures were introduced and subsequently extended in order to tackle the sovereign debt crisis in the peripheral Eurozone countries, in Greece and Ireland initially. For this reason, in the first half of the year, a purchase programme was introduced to the secondary market of government and corporate bonds to have them acquired by the national central banks on behalf of the ECB. Subsequently, the European Central Bank advised on the continuation of the extraordinary measures introduced during the 2008 crisis until the spring of 2011, in light of continuing tensions relating to government bonds of the peripheral Eurozone countries. In regard to the currency market, 2010 was characterized by the Euro crisis, triggered at first by the Greek crisis and

Consolidated Management Report • 9 FINANCIAL YEAR 2010

then by the Irish crisis. The significant structural differences between the different economies within the single currency, aggravated by the fall-out of the 2008 financial crisis, the lack of a homogeneous fiscal policy within this area and the perception of poor political cohesion with the resulting delay in adopting appropriate measures to tackle the crisis, caused a significant decrease of theE uropean currency, not only in relation to more classic safe haven currencies such as the Swiss franc, which increased in value by 16%, and the yen, which increased by 18%, but also, in an initial phase, towards the dollar, which increased by 7%. Only with the adoption of an extraordinary intervention plan in May amounting to 750 billion Euros, launched by the European Union with the participation of the IMF, and the introduction of the aforementioned unconventional monetary policies by the ECB, it was possible to slow down the devaluation of the Euro, which was weakened even further by the eruption of the Irish crisis in autumn. In this case also, only the decision by the Irish government to adopt an extraordinary bailout plan totalling 95 billion Euros, similar to the previous bailout for Greece, allowed the single currency to regain lost ground in relation to the US dollar. In regard to raw material, market prices rose in general, due to both an improvement in the economic crisis, driven mainly by emerging countries where the demand of raw material is higher, and the maintaining of expansive monetary policies which favour financial investments in tangible assets. TheCR B index rose by 15% during the year, with peaks in the precious metal and agricultural raw material segments. The price of oil increased by 13% while the price of gold rose by 28%, reflecting mainly the uncertainty surrounding the development of the euro crisis and the wider diversification of currency reserves by central banks, mainly in emerging countries. From a corporate point of view, the trend of corporate earnings both in industrialized and emerging countries confirmed an extremely positive outlook, highlighting the great flexibility and efficiency which have characterized the behaviour of large international companies in these last few years of sudden and significant changes in the macroeconomic scenarios. At an aggregate level, the analysts’ estimates for 2010 forecast an increase in profits of 31.6% for the American S&P index; in Europe, similar estimates for the DJ Stoxx 600 index forecast a rise in profits of 64.2%, driven mainly by the results of German companies which are strongly exposed to emerging countries. In this context, the main share price indices realized good increases during the year, even though with not very homogeneous results, also within the same geographical areas. So, while the MSCI WORLD index closed 2010 with a positive performance of 7.7% in local currency (+17.4% in euros) and the American S&P 500 index rose by 11.7%, Eurostoxx 50 and the Japanese Topix decreased by -5.4% and -0.9%, respectively. The domestic stock exchange was also particularly badly hit with the FTSE Italia All Share decreasing by -11.5%. However, the results of the stock exchanges of Emerging Countries were encouraging with the MSCI Emerging Markets index in local currency rising by 12% and significant increases recorded in some markets such as Thailand SE( T index +40.6%) and Russia (RTS index +24%). At a global level, the best performances were registered in the discretionary consumer sector (+19.6%) and in the industrial sector (+17.7%), while negative results were recorded in the public utility sector (-4.2%) and the health industry (-1.4%). In 2010, the very high performance that characterized the small and medium cap corporate CONSOLIDATED MANAGEMENT REPORT segment compared to larger companies should also be taken into account; the American Russell 2000 index, for example, saw a rise of 24.7%, much higher than the S&P 500 result. In regard to the government bond market, the crisis that hit the peripheral Eurozone countries with high/growing budget deficit or a high stock of debt compared to DPG (mainly Greece, Portugal, Ireland, Spain and Italy) gave rise to extremely varied results, even within a fairly stable framework of official rates and a strongly decreasing inflation rate that at times even triggered fears of a deflation spiral. The positive trend regarded mainly the issuers considered to be the most secure: the index of American government bonds with maturity between 5 and 10 years rose by 7.8% with the decade yield going from 3.8% in 2009 to 3.4% at the end of 2010. In Europe, the ML EMU index for maturity between 5 and 10 years increased only by 0.5% due to the contrasting influence of the extremely positive trend of the German Bund and the extremely negative trend of peripheral Eurozone countries whose yield spreads compared to Bund reached the highest levels since the introduction of the Euro. The yield of the German ten-year Bund decreased to 2.9% at the end of the year, compared with 3.4% at the end of 2009. The improved economic perspectives and general financial conditions once again favoured price trends in the riskiest segments of the bond market, such as corporate issues, both Investment Grade and High Yielder, convertible

10 • Consolidated Management Report FINANCIAL YEAR 2010 bonds and sovereign issues of the emerging countries, whose yield spreads compared to government bonds decreased again, albeit less than the exceptional shrinking in 2009. The EMU Corporate index increased by 5% during the year while the riskiest segment of corporate equities registered a performance of 14.2%. Convertible bonds registered a rise of 9.4% while government bonds of emerging countries rose by 12%.

2011 In regard to economic growth, forecasts show a good growth profile for the GrossD omestic Product in 2011, with possible positive surprises resulting from improved consumption in the US. In Europe, the different growth dynamics between core area countries, led by Germany, characterized by higher growth rates, and peripheral countries with weak if not negative growth rates should continue. In the Emerging Countries, even with the continuation of restrictive fiscal and monetary policies to slow down inflation, growth should not be significantly slowed down.A t an aggregate level, the latest estimates for 2011 (IMF source) forecast a global growth rate of 4.4%, slowly decreasing compared to +5% forecasted for 2010 with a moderated growth in industrialized countries, forecasted at 2.5% and a higher growth in emerging countries of 6.5%. As a consequence, the effect on corporate profits should be positive as confirmed by top-down and bottom-up estimates that forecast an average growth of between 8% and 20%. At present, the growth in profits expected for 2011 is 15.2% for theA merican S&P500 index and 18.1% for the European DJ STOXX 600. As for interest rates, there should be no significant change in the level of official rates in industrialized countries in 2011, remaining at the current minimum levels. Inflation should remain low thanks to a continuing negative output gap and a high unemployment rate. However, in emerging countries an increase in the price of oil and especially an increase in food components shall continue to raise inflation, which could also influence core data.C urrently, an increase in consumer prices of 1.6% for industrialized countries and 6% for emerging countries (IMF source) is expected. As for market rates, however, the upward trend of the last part of 2010 should continue, due to both a standardization in yields following the levels reached during the worst of the 2008 financial crisis and the consequences of the crisis in the peripheral euro zone countries. Similarly, in emerging countries, the upward pressure should come from both the aforementioned standardization effect and specific action taken by monetary authorities to contain price pressures. In regard to absolute valuations of the main equity markets, there are no significant barriers to further index recovery, even if some fears started to emerge in relation to corporate profitability that is already extremely high compared to historical standards and therefore difficult to improve on.I n relative terms, comparing share valuations based on expected profits with corporate bond yields, the undervaluation of equity markets is still obvious compared to bond markets. On the basis of the main valuation indicators, the equity markets of emerging countries no longer deal at discount yield compared to the average equity markets of developed countries; therefore, combined with widespread complacency in relation to the former, their relative strength could trigger a temporary deterioration. CONSOLIDATED MANAGEMENT REPORT The Bim Group: reference markets The main markets of the Bim Group are represented by the Italian private banking market - both in the banking segment represented by its subsidiary (Banca Intermobiliare) and in the external banking/promoter segment (Banca Ipibi) - and the Italian managed saving products and services market where Symphonia Sgr operates. The Group also has a strong presence in other specific market segments (negotiation, private banking inS witzerland) that can be associated with fundamental markets. Analysis by the Italian Association of Private Banking (at the date of publication of this document, data for the first 9 months of the year were available) show some main findings for the market segment served by the so called traditional operators, with the banking subsidiary: - a slight increase in market assets (1.8%), where Bim continues to maintain a generally stable market share of 3.5%. Market growth was mainly due to net collection flows, being insignificant the effect of market prices; - a significant restructuring of clients’ portfolios, that progressively reduced the investment in liquid products: this phenomenon occurred at an Italian banking system level, at a traditional operator level and also in the BIM

Consolidated Management Report • 11 FINANCIAL YEAR 2010

Group; - the slight recovery of asset profitability; - the slow introduction of the financial advisory service for investments. On the market, the only extraordinary operation concluded within the year was the acquisition of Meliorbanca Private S.p.A. by Santander Private S.p.A., an Italian bank belonging to the Spanish Santander group. In relation to the private banking market, served by external financial promoters,A ssoreti’s statistics indicated extremely polarized phenomena. The market collected a total amount of 12 billion, keeping higher growth rates than traditional banking operators. Investment choices during the year preferred managed savings products into which a total of 14.2 billion Euros was invested. The total assets of products distributed by companies within the sector increased from 230 billion in 2009 to 236 billion at the end of 2010. Within the market there are entities that are growing with very significant dynamics, but there are also operators with prolonged restructuring, crisis and repositioning issues. In this segment, Banca Ipibi, with a net yield of over 20% of the total assets and an average yield per promoter of more than10 million Euros, made a jump in the performance ratings, gradually reaching a position in the most prestigious segment of the market. Finally, in relation to asset management companies, Assogestioni indicates an extremely polarized asset management market with the first 5I talian groups managing over 50% of the total equity managed by the system. The market grew in size, increasing from 950 billion in 2009 to 1,007 billion Euros at the end of 2010; at the same time the number of system managers decreased from 344 to 335 because of some extraordinary transactions on the market. Assets managed by Italian groups grew by around 20 billion compared with the total managed volume of 792 billion. Foreign groups recorded better performances, favoured, among other factors, by the asymmetries on the features of the products, that registered a growth in managed volume equal to 37 billion, increasing from 177 billion the previous year to 214 for the current period. Concerning products, monetaries decreased sharply (-27%) mainly in favour of equity sub-funds (+16%) and bonds (+11%). CONSOLIDATED MANAGEMENT REPORT

12 • Consolidated Management Report FINANCIAL YEAR 2010

Main group information

Summary Data

31.12.2010 31.12.2009 Change Change amount % RECLASSIFIED ECONOMIC VALUES ( stated in EUR ‘000) Net interest income 29,128 27,945 1,183 4.2% Net operating income 125,504 132,376 (6,872) -5.2% Operating profit (loss) 25,936 36,711 (10,775) -29.4% Profit before non-recurring components 18,283 6,926 11,357 164.0% Profit (loss) before tax 17,344 12,630 4,714 37.3% Group profit (loss) for the year 10,253 8,572 1,681 19.6%

ASSETS AND OPERATING VALUES (stated in millions of euro)

Total client assets 13,921 13,931 (10) -0.1% Deposits and other securities 2,026 2,361 (335) -14.2% Invested assets 12,104 11,746 358 3.1% - of which assets under administration and custody 6,022 6,442 (420) -6.5% - of which assets under management 5,801 5,047 754 14.9% - of which assets managed through trusts 281 257 24 9.4% Performing loans to clients 1,536 1,242 294 23.7% Total assets 3,291 3,438 (147) -4.3% Group equity 410 403 7 1.74% Regulatory capital 402 418 (16) -3.8% Excess Capital 213 204 9 4.4%

RISK ASSETS AND EQUITY RATIOS

Risk-weighted assets (in millions of euro) 2,366 2,678 (312) CONSOLIDATED MANAGEMENT REPORT Tier 1 capital ratio 11.47% 9.87% 1.597 Total capital ratio 17.00% 15.61% 1.391

OPERATING STRUCTURE (stated in units) Number of employees and collaborators (total) 896 861 35 4.1% - of which Banca Intermobiliare Private bankers 189 193 (4) -2.1% - of which Banca Ipibi Private bankers 162 139 23 16.5% Number of Banca Intermobiliare branches 29 29 - - Number of Banca Ipibi branches and private bankers offices 38 32 6 18.8%

Consolidated Management Report • 13 FINANCIAL YEAR 2010

31.12.2010 31.12.2009 Change % point INCOME RATIO Net interest income/Net operating income 23.2% 21.1% 2.1 Net fees and commissions/Net operating income 56.4% 53.7% 2.7 Operating profit (loss)/ Net operating income 20.7% 27.7% -7.1 Cost/income ratio (excluding other operating income/charges) 81.8% 75.1% 6.7 Cost/income ratio (including other operating income/charges) 79.3% 72.3% 7.1 R.O.E. 2.5% 2.2% -0.3 CREDITY QUALITY RATIO Net impaired assets / Performing loans 11.6% 26.3% -14.8 - of which net non-performing loans/Performing loans 8.5% 11.1% -2.6 Net impaired assets / Loans to clients 9.6% 18.8% -9.3 - of which net non-performing loans/Loans to clients 7.0% 8.0% -1.0 Non-performing loans hedge (valuation reserve/gross exposure) 29.4% 32.0% -2.6

31.12.2010 31.12.2009 Change Change amount % EMPLOYEE INFORMATION (stated in EUR ‘000) Net operating income / Number of employees 140 154 (14) -9.1% Personnel costs/ Average number of employees 84 81 3 3.7% Total assets/ Number of employees 3,673 3,993 (320) -8.0% INFORMATION ON BANCA INTERMOBILIARE EQUITY

Number of outstanding ordinary shares (excluding treasury shares) 149,041,517 149,067,507 (25,990) 0.0% Unit equity on outstanding shares in EUR 2.75 2.72 0.03 1.3% Price per ordinary share during the year average 4.00 3.02 0.98 32.3% minimum 3.15 2.12 1.03 48.7% maximum 4.32 4.16 0.16 3.9% Basic EPS - EUR 0.061 0.048 0.013 26.3% Diluted EPS - EUR 0.053 0.042 0.011 26.2% CONSOLIDATED MANAGEMENT REPORT

P reparation of reclassified aggregates

In order to allow a clearer reading of economic and equity results in relation to the tables indicated in Bank of Italy memorandum 262/05, the reclassified accounts have been prepared in tables which introduce some new items and combinations and for which analytical information has been provided in accordance with Consob requirements laid down in Communication no. 6064293 of 28 July 2006.

Furthermore, in relation to the financial statements published at 31.12.2009, the item N“ on-current assets held for sale” of the investment in Immobiliare D S.r.l. has been reclassified with I“ nvestments” in the reclassified accounts as, at present, the sales conditions of the above mentioned investment cannot be fully estimated and therefore the assumptions required by the Ifrs 5 Accounting Policy cannot be fulfilled.

14 • Consolidated Management Report FINANCIAL YEAR 2010

Reclassified consolidated financial statements Reclassified consolidated profit and loss account (stated in EUR ‘000)

Period Period Change Change 2010 2009 amount % Interest income and similar items 60,777 75,996 (15,219) -20.0% Interest expense and similar items (31,649) (48,051) 16,402 -34.1% Net interest income 29,128 27,945 1,183 4.2% Commission income 113,829 108,026 5,803 5.4% Commission expense (43,072) (36,962) (6,110) 16.5% Net fees and commissions 70,757 71,064 (307) -0.4% Dividends 2,929 1,280 1,649 128.8% Net profit on trading instruments 15,592 18,089 (2,497) -13.8% Net profit on hedging instruments - 553 (553) -100.0% Net profit on sale of other instruments 7,098 13,445 (6,347) -47.2% Net operating income 125,504 132,376 (6,872) -5.2% Personnel costs (56,715) (55,665) (1,050) 1.9% Other administrative overheads (37,742) (35,149) (2,593) 7.4% Operating amortisation and depreciation (8,238) (8,583) 345 -4.0% Other operating income/charges 3,127 3,732 (605) -16.2% Operating costs (99,568) (95,665) (3,903) 4.1% Operating profit (loss) 25,936 36,711 (10,775) -29.4% Net write-down on loans (4,443) (18,221) 13,778 -75.6% Net provisions for liabilities and charges (3,237) (11,909) 8,672 -72.8% Net profit (loss) of subsidiaries valued using net equity method 27 345 (318) -92.2% Profit (loss) before non-recurring components 18,283 6,926 11,357 164.0% Profit (loss) from disposal and value adjustments on financial instruments (1,935) 5,704 (7,639) NA CONSOLIDATED MANAGEMENT REPORT Profit (loss) from investments disposal 996 - 996 NA Profit (loss) before tax 17,344 12,630 4,714 37.3% Income taxation (8,315) (6,616) (1,699) 25.7% Profit (Loss) of current operations after tax 9,029 6,014 3,015 50.1% Profit (Loss) of discontinued operations after tax - 1,154 (1,154) -100.0% Net profit (Loss) for the year 9,029 7,168 1,861 26.0% Loss attributable to minority interest 1,224 1,404 (180) -12.8% Group net profit (Loss) for the year 10,253 8,572 1,681 19.6%

Note: In order to achieve a clearer management representation of results (in relation to the income statement reported in the Financial Statements Section), the costs relating to the variable component of private bankers’ remuneration in the item "Personnel costs" have been reclassified under item "Commission expense" for €/'000 3,001 (€/’000 3,637 at 31/12/2009) and loan additional charges from item "Interest payable” to item “Net profit (loss) of trading activities” for €/’000 512 (€/’000 171 at 31.12.2009).

Consolidated Management Report • 15 FINANCIAL YEAR 2010

Reclassified consolidated balance sheet (stated in EUR ‘000)

31.12.2010 31.12.2009 Change Change amount % Cash on Hand 3,511 4,788 (1,277) -26.7% Loans: - Loans to clients for performing loans 1,535,710 1,242,419 293,291 23.6% - Loans to clients others 319,540 490,757 (171,217) -34.9% - Loans to banks 260,024 441,875 (181,851) -41.2% Financial assets - Held for trading 414,296 532,325 (118,029) -22.2% - Available for sale 399,408 373,110 26,298 7.0% - Held to maturity 5,627 5,551 76 1.4% Fixed assets: - Investments 5,950 5,996 (46) -0.8% - Intangible and tangible 185,390 185,764 (374) -0.2% - Goodwill 65,294 65,294 - - Other assets 95,883 89,742 6,141 6.8% Total assets 3,290,633 3,437,621 (146,988) -4.3% Loans payables: - Due to banks 453,994 493,334 (39,340) -8.0% - Due to customers 1,750,607 1,979,046 (228,439) -11.5% Outstanding securities 415,447 365,581 49,866 13.6% Financial liabilities: - Held for trading 149,529 85,923 63,606 74.0% - Hedging liabilities 148 94 54 57.4%

CONSOLIDATED MANAGEMENT REPORT Specific provisions 18,825 22,161 (3,336) -15.1% Other liability items 91,955 88,978 2,977 3.3% Equity 410,128 402,504 7,624 1.9% Total liabilities 3,290,633 3,437,621 (146,988) -4.3%

16 • Consolidated Management Report FINANCIAL YEAR 2010

R eclassified consolidated income statement last quarter of 2010 (stated in EUR ‘000)

Period Period Change Change IV quarter IV quarter amount %

2010 2009 Interest income and similar items 16,038 18,505 (2,467) -13.3% Interest expense and similar items (8,460) (12,304) 3,844 -31.2% Net interest income 7,578 6,201 1,377 22.2% Commission income 35,218 40,007 (4,789) -12.0% Commission expense (13,511) (16,194) 2,683 -16.6% Net fees and commissions 21,707 23,813 (2,106) -8.8% Dividends 333 4 329 NA Net profit on trading instruments 4,826 2,258 2,568 113.7% Net profit on hedging instruments - 406 (406) -100.0% Net profit on sale of other instruments 1,847 10,204 (8,357) -81.9% Net operating income 36,291 42,886 (6,595) -15.4% Personnel costs (15,380) (15,078) (302) 2.0% Other administrative overheads (11,940) (9,800) (2,140) 21.8% Operating amortisation and depreciation (1,928) (2,171) 243 -11.2% Other operating income/charges 1,324 (734) 2,058 NA Operating costs (27,924) (27,783) (141) 0.5% Operating profit (loss) 8,367 15,103 (6,736) -44.6% Net write-down on loans (2,360) (19,175) 16,815 -87.7% Net provisions for liabilities and charges (1,444) (8,869) 7,425 -83.7% Net profit (loss) of subsidiaries valued using net equity method 57 195 (138) -70.8% Profit (loss) before non-recurring components 4,620 (12,746) 17,366 136.2% Profit (loss) from disposal and value adjustments on financial instruments (1,935) (126) (1,809) NA Profit (loss) from investments disposal 996 - 996 NA Profit (loss) before tax 3,681 (12,872) 15,557 120.9% CONSOLIDATED MANAGEMENT REPORT Income taxation (2,268) 3,857 (6,125) NA Profit (Loss) of current operations after tax 1,413 (9,015) 9,432 104.6% Profit (Loss) of discontinued operations after tax (47) - (47) NA Net profit (Loss) for the year 1,366 (9,015) 9,385 104.1% Loss attributable to minority interest 372 469 (97) -20.7% Group net profit (Loss) for the year 1,738 (8,546) 9,288 108.7%

Consolidated Management Report • 17 FINANCIAL YEAR 2010

Quarterly consolidated/reclassified income statement (stated in EUR ‘000)

Year 2010 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Interest income and similar items 14,753 15,343 14,643 16,038 Interest expense and similar items (7,586) (7,841) (7,762) (8,460) Net interest income 7,167 7,502 6,881 7,578 Commission income 25,942 26,341 26,328 35,218 Commission expense (9,336) (10,098) (10,127) (13,511) Net fees and commissions 16,606 16,243 16,201 21,707 Dividends 102 2,181 313 333 Net profit on transaction instruments 4,336 1,959 4,471 4,826 Net profit on hedging instruments (126) 126 - - Net profit on sale of other instruments 448 2,960 1,843 1,847 Net operating income 28,533 30,971 29,709 36,291 Personnel costs (12,466) (15,257) (13,612) (15,380) Other administrative overheads (7,974) (8,808) (9,020) (11,940) Operating amortisation and depreciation (2,123) (2,080) (2,107) (1,928) Other operating income/charges 1,133 165 505 1,324 Operating costs (21,430) (25,980) (24,234) (27,924) Operating profit (loss) 7,103 4,991 5,475 8,367 Net write-down on loans (2,168) 398 (313) (2,360) Net provisions for liabilities and charges (501) (1,304) 12 (1,444) Net profit (loss) of subsidiaries valued using net equity method (71) 258 (217) 57 Profit (loss) before non-recurring components 4,363 4,343 4,957 4,620 Profit (loss) from disposal and value adjustments - - - (1,935) on financial instruments Profit (loss) from investments disposal - - - 996 Profit (loss) before tax 4,363 4,343 4,957 3,681 CONSOLIDATED MANAGEMENT REPORT Income taxation (1,591) (1,937) (2,519) (2,268) Profit (Loss) of current operations after tax 2,772 2,406 2,438 1,413 Profit (Loss) of discontinued operations after tax (7) 104 (50) (47) Net profit (Loss) for the year 2,765 2,510 2,388 1,366 Loss attributable to minority interest 258 258 336 372 Group net profit (Loss) for the year 3,023 2,768 2,724 1,738

18 • Consolidated Management Report FINANCIAL YEAR 2010

Quarterly consolidated/reclassified balance sheet (stated in EUR ‘000)

Year 2010 31.03 30.06 30.09 31.12 Cash on Hand 3,538 3,916 3,572 3,511 Loans: - Loans to clients for performing loans 1,415,972 1,427,367 1,480,047 1,535,710 - Loans to clients others 357,245 344,577 377,226 319,540 - Loans to banks 311,287 330,002 271,514 260,024 Financial assets: - Held for trading 503,108 526,846 476,698 414,296 - Available for sale 406,239 405,503 420,436 399,408 - Held to maturity 5,597 5,644 5,579 5,627 Fixed assets: - Investments 6,054 6,225 6,034 5,950 - Intangible and tangible 185,658 185,427 184,626 185,390 - Goodwill 65,294 65,294 65,294 65,294 Other assets items 97,664 94,986 141,788 95,883 Total assets 3,357,656 3,395,787 3,432,814 3,290,633 Loans payables: - Due to banks 722,958 706,241 736,105 453,994 - Due to customers 1,629,514 1,678,172 1,609,378 1,750,607 Outstanding securities 397,753 346,071 356,589 415,447 Financial liabilities: - Held for trading 88,224 157,444 150,512 149,529 - Hedging liabilities 201 229 213 148 Specific provisions 21,464 21,777 18,716 18,825 Other liability items 90,938 82,647 153,459 91,955 Equity 406,604 403,206 407,842 410,128 CONSOLIDATED MANAGEMENT REPORT Total liabilities 3,357,656 3,395,787 3,432,814 3,290,633

Consolidated Management Report • 19 FINANCIAL YEAR 2010

Summary of results and management performance

2010 was characterised by the merger of Banca Intermobiliare into the Veneto Banca Group. This transaction was announced last 6 April 2010 following an agreement reached by Parent Company CoFiTo S.p.A.’s shareholders: the Scanferlin, D’Aguì and Giovannone families signed an agreement for the merger through acquisition of Cofito with Veneto Banca and thus the acquisition by the latter of control of IMB and its banking group. After signing the above mentioned agreement, BIM renewed its Board of Directors, (whose office expired with the approval of the 2009 financial statements), currently consisting of eleven members, the majority of whom were nominated by Veneto Banca Group. This transaction was authorized by the relevant Authorities in December last year. The entry of Banca Intermobiliare in a large and nationally important banking group represents a significant change and will allow the Bim Group to receive more structured support to respond to the new challenges of the competitive environment. The incorporation of Cofito into Veneto Banca came into effect in February 2011 and will be followed by a compulsory takeover bid launched by Veneto Banca on all residual outstanding BIM shares. Moreover, as already publicly announced to the market, Veneto Banca intends to keep BIM shares listed on the Italian Telematic Stock Exchange, therefore the company will reinstate the outstanding shares if, as a result of the above offer, it should exceed an equity interest of 90% in BIM share capital.

The financial year 2010 of Banca Intermobiliare Group closed with a consolidated net profit of € 10.253m, an increase of 19.6% over the previous financial year.

The Group’s total client assets remained at the same levels as the previous financial year: € 13.9b: the positive growth in private client assets of Banca Intermobiliare, Banca Ipibi and Symphonia Sgr was partially neutralized by the value decrease attributable to some institutional clients relationships.

During the financial year, the conditions of financial markets favoured a gradual increase in clients' risk appetite; many abandoned the extremely conservative positions they had taken during the two previous financial years because of the financial markets crisis. Client assets breakdown significantly changed over the previous year: at 31

CONSOLIDATED MANAGEMENT REPORT December 2010, deposits and other securities amounted to € 2.0b, decreasing by 14.2% y-o-y. This drop in deposits and other securities was entirely compensated by an increase in invested assets: in particular, the client assets under administration and custody fell to € 6b, a decrease of 6.5% y-o-y, while assets under management showed a dramatic increase (€ 5.8b, +14.9% y-o-y).

Loans to clients at 31.12.2010 amounted to € 1,855m, recording a 7% increase. In particular, performing loans increased relevantly (€ 1,536m, +23.6%), due to new disbursements for approximately € 145m and to performing return of positions previously classified as impaired for approximately € 148m.

Consolidated equity amounted to € 410m, a slight increase (+1.9%) over the previous financial year. The significant strengthening of the solidity indicators of the Group is to be highlighted: at 31.12.2010 the Tier 1 Ratio was 11.5%, recovering 1.6 percentage points over 2009. The Total Capital Ratio was 17%, as opposed to 15.6% for 2009. Unlike the events of the 2009 financial year, the income statement for the current financial year does not register

20 • Consolidated Management Report FINANCIAL YEAR 2010 significant impacts from extraordinary or non-recurrent items. The net interest income closed with an increase of 4.2%, amounting to € 29.1m. Net fees and commissions are mainly in line with the previous year (€ 70.7m vs. € 71.1m in 2009): during this financial year performance fee contribution significantly decreased on assets under management (around € 6m in 2010, around € 18m in 2009), while recurring fees generated by the same assets sharply increased. Worth noting is the result of advisory fees on investments, which exceeded € 2.3m (up from € 0.9m in 2009). The overall result of proprietary trading activity is positive for over € 25m. In 2009 the same result amounted to € 32m, thanks also to the disposal on the market of the investment in LSE/Borsa Italiana, held in portfolio since the '90s. The consolidated net operating income amounted to € 125.5m, as compared with € 132.4m in 2009 (-5.2/y-o-y). The Group operating costs increased by 4.1%, reaching € 99.6m. Personnel costs remained generally in line with 2009 (+1.9% y-o-y), while administrative overheads increased by 7.4%, exceeding € 37m. Operating profit (loss) amounted to € 25.9m, as opposed to € 36.7m in 2009. Profit (loss) before tax was € 17.3m, against € 12.6m in 2009: during the financial year, net value adjustments on loans and net provisions for liabilities and charges returned to conform with historical data for the Group, with a total impact of 7.6m (they were approximately € 30m in 2009). After considering income tax expenses as well as losses attributable to minority interests, the Group net profit for the year is € 10.2m, +19.6% over the previous year. With reference to the trend of the main items describing the Group income and equity situation under the statutory profile, the financial statements of Parent Company Banca Intermobiliare di Investimenti e Gestioni closed with an operating profit of € 26.6m. (+12% y-o-y) and with a net profit for the year of € 13.9m.

With regards to subsidiaries, Symphonia Sgr client assets significantly increased (+10.3%, as a result of the change following the merger through acquisition of BIM Alternative Investments SGR S.p.A. in Symphonia SGR S.p.A. effective January, 1st 2010) and the increase in development initiatives of Banca Ipibi of Financial Advisory, whose client assets exceeded € 1,540m (+30.9% y-o-y) thanks also to the growth of the financial advisors network.

Tax audit on Banca Intermobiliare On 31 March 2010 a tax audit began on the Parent Company, Banca Intermobiliare, in relation to direct taxes, regional tax on production and VAT regarding previous financial years. At the approval date of these draft financial statements, the tax audit report had not yet been communicated. The main items identified by the company through the management of daily reports have been analysed by the management and the external consultants who do not foresee any implications for the company. CONSOLIDATED MANAGEMENT REPORT

Consolidated Management Report • 21 FINANCIAL YEAR 2010

Events after the financial statements reporting date

Change of Parent Company Veneto Banca S.c.p.a., following a merger by incorporation of Cofito (majority shareholder of Banca Intermobiliare) on 18 February 2011 and registered on the Treviso and Turin Company Registers on 25 February 2011, acquired legal control of the Issuer, Banca Intermobiliare. Following the aforementioned acquisition by Veneto Banca S.c.p.a., the legal requirements for a compulsory takeover bid were met, pursuant to articles 102 and 106, paragraph 1 of the Italian Consolidated Law on Finance (TUF), relating to residual outstanding BIM shares. The Bidder shall give each offer participant a cash price amounting to 4.25 Euros for each share surrendered to participate in the Offer. Veneto Banca intends to keep BIM shares listed on the Electronic Stock Exchange, therefore the company will reinstate the outstanding shares if, as a result of the above offer, it should exceed an equity interest of 90% in BIM share capital.

BUSINESS OUTLOOK

The expected economic and financial results of the Group are clearly influenced by financial market trends: the first months of 2011 confirm the positive trend seen in the second half of the previous financial year, with particular reference to a regained client interest in riskier assets and trading and operating activities. Market conditions are favourable and seem to lead to a moderate increase in operating volumes. During the period, the Group shall continue the development of its distribution network, both on the Parent bank and on its subsidiary Banca Ipibi; the Group will promote, as well as the launch of important innovation projects for the range of products (Symphonia product range) and services (investment advisory). CONSOLIDATED MANAGEMENT REPORT

22 • Consolidated Management Report FINANCIAL YEAR 2010

Operating figures and balance sheet data

Total client assets

The Group’s total client assets at 31.12.2010 amounted to € 13,921m, net of duplications, and are in line (-0.1%) with the 2009 financial year.A ssets under management increased significantly from € 5,047m to € 5,801m (+14.9% y-o-y) while assets under administration and custody decreased by 6.5%.

Breakdown of total client assets at 31.12.2010 (in millions of Euros)

31.12.2010 31.12.2009 Change Change amount % Deposits and other securities 2,026 2,361 (335) -14.2% Client assets under administration and custody 6,022 6,442 (420) -6.5% Client assets under management 5,801 5,047 754 14.9% Client assets managed through trusts 281 257 24 9.4% Invested assets 12,104 11,746 358 3.1% CLIENT ASSETS after duplications 13,921 13,931 (10) -0.1%

Invested assets are shown before cash present on assets; clients’ assets under management are shown after such duplication.

Deposits and other securities With the evolution of money market rates, clients have progressively reduced the exposure on current accounts and REPOs, choosing different asset classes for their investments, in particular managed asset instruments. The consolidated overall of deposits and other securities decreased by € 335m during the year, amounting to € 2,026.

Details of deposits and other securities at 31.12.2010 (in millions of euros)

31.12.2010 31.12.2009 Change Change CONSOLIDATED MANAGEMENT REPORT amount % Current accounts 1,521 1,830 (309) -16.9% REPOs and securities lending 59 134 (75) -56.0% Due to customers 1,580 1,964 (384) -19.6% Outstanding securities 446 397 49 12.3% Securities issued 446 397 49 12.3% DEPOSITS AND OTHER SECURITIES 2,026 2,361 (335) -14.2%

Consolidated Management Report • 23 FINANCIAL YEAR 2010

Invested assets I nvested assets mainly confirmed the values of the last periods, amounting to€ 12,104m (+3% y-o-y). During the financial year, the trend to invest in assets under management continued and a great amount of interest spread among the clients: overall, assets under management increased by +14.9% over 31.12.2009, registering significant increases in all segments and in particular for collective products. However, assets under administration and custody recorded a decrease of 6.5%. D etails of client assets at 31.12.2010 (in millions of euros) 31.12.2010 31.12.2009 Change Change amount % DEPOSITS AND OTHER SECURITIES - Due to clients 1,580 1,964 (384) -19.6% Securities issued 446 397 49 12.3% Total deposits and other securities 2,026 2,361 (335) -14.2% INVESTED ASSETS Equity under administration 6,022 6,442 (420) -6.5% Equity under management Management lines 2,791 2,592 199 7.7% Sicav, Multisicav and Provisions 2,248 1,854 394 21.3% Hedge Funds 218 185 32 17.3% Insurance products 544 416 128 30.8% Total equity under management 5,801 5,047 754 14.9% - of which products under the Group’s management 4,709 4,347 363 8.4% Assets managed through trusts 281 257 24 9.4% Total invested assets 12,104 11,746 358 3.0% CLIENT ASSETS after duplications 13,921 13,931 (10) -0.1%

Client assets invested in products under Group companies management (in millions of euros) 31.12.2010 31.12.2009

CONSOLIDATED MANAGEMENT REPORT Total Client Group Minority Total Client Group Minority assets Products interest assets Products interest products products Collective Asset Management 2,248 1,552 696 1,795 1,471 324 Individual Asset Management 2,791 2,706 85 2,650 2,582 68 Hedge Funds 218 218 - 185 185 - Insurance Products 544 234 310 416 108 308 TOT. CLIENT ASSETS IN PRODUCTS UNDER 5,801 4,709 1,091 5,047 4,347 701 MANAGEMENT

Client assets invested in products managed by Group companies, totalling € 4,709m (+8.3%), recorded a very significant growth mainly in line with equity management, which remains the core product of the Group offer, dedicated to mid-high range clients. Also, the growth in client assets invested in insurance products of Bim Vita was significant: it more than doubled (from € 108m to € 234).

24 • Consolidated Management Report FINANCIAL YEAR 2010

Loans and other advances to clients

The amount of loans to clients at 31.12.2010 was € 1,855m an increase of 7%, mainly because of an increase in performing loans of approximately € 293m during the year, of which approximately € 145m derived from new disbursements and around € 148m derived from previously impaired positions that returned to performing loans within the period.

Details of loans to clients (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Performing loans to clients 1,535,710 1,242,419 293,291 23.6% Other loans to clients 319,540 490,757 (171,217) -34.9% Total loans to clients 1,855,250 1,733,176 122,074 7.0%

Performing loans to clients (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Overdraft 882,916 789,199 93,717 11.9% Mortgage loans 430,824 300,320 130,504 43.5% Short-term borrowings 221,970 152,900 69,070 45.2% Total performing loans 1,535,710 1,242,419 293,291 23.6%

Performing loans to clients amounted to € 1,536m: disbursements are represented by overdraft (€ 883m equal to 57% of the total amount), by mortgage loans (€ 431m equal to 28% of the total amount) and by short-term borrowings (€ 222m equal to 14% of the total amount). The increase in performing loans is due to both new disbursements of credit carried out by clients, and to the return of some significant performing positions, mainly in the real estate segment.M ost of this activity happened in the first half of year 2010.

Other loans to clients CONSOLIDATED MANAGEMENT REPORT (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Income and deposits at clearing houses 119,751 123,127 (3,376) -2.7% Securities lending and repos with counterparties 7,020 13,376 (6,356) -47.5% Net impaired assets 177,809 326,453 (148,644) -45.5% Debt securities 5,494 10,249 (4,755) -46.4% Other positions 9,466 17,552 (8,086) -46.1% Total other loans to clients 319,540 490,757 (171,217) -34.9%

Other loans to clients amounted to € 320m, decreasing over 31.12.2009 (-34.9%). This item includes income deposited with clearing houses and non-banking brokers relating to derivative transactions on Italian and foreign markets, transactions of securities lending and repos realized with institutional counterparties, net impaired activities

Consolidated Management Report • 25 FINANCIAL YEAR 2010

and other minor positions. The main changes over 31.12.2009 are mainly related to the decrease in doubtful loans, following the return of performing expositions to clients.

Net impaired assets (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change Net exposure Net exposure amount % Non-performing loans 130,544 138,461 (7,917) -5.7% Watchlist loans 25,920 106,760 (80,840) -75.7% Restructured exposures 2,784 1,541 1,243 80.7% Expired exposures 18,561 79,691 (61,130) -76.7% Net impaired assets 177,809 326,453 (148,644) -45.5%

Gross and net exposure of impaired assets (stated in EUR ‘000)

Gross Value Net Exposure Adjustments exposure Non-performing loans 184,821 (54,277) 130,544 Watchlist loans 26,947 (1,027) 25,920 Restructured exposures 3,198 (414) 2,784 Expired exposures 18,801 (240) 18,561 Impaired activities 233,767 (55,958) 177,809

Banca Intermobiliare Group registered a sharp decrease in impaired activities equal to approximately € 148m, mainly related to the return of overdraft positions (€ 61.1m) and to the significant drop in watchlist loans positions (€ 80.8m) due to the end of temporary difficulty of some debtors. Over 31.12.2009, non-performing net positions decreased by 5.7% mainly due to the collection of previous interests accrued on the main credit exposure to the Coppola Group companies and to Partecipazioni Immobiliari. Such exposure, assisted by investment and real estate guarantees, at 31 December 2010, amounted to approximately € 141m gross and around € 116m after valuation reserves. CONSOLIDATED MANAGEMENT REPORT With reference to the watchlist loans net exposures and expired net exposures, during the first quarter the partial repayment of two relevant positions to clients operating in the real estate segment was carried out, as already mentioned in the financial statements at 31.12.2009 and in the subsequent interim financial statements of 2010. Both positions are presently classified as performing. In the first case, the watchlist loans position at 31.12.2009 for € 82m decreased after the client’s payment of € 23m, as partial repayment of capital and of some expired instalments. On this position, the residual exposure on the performing return date was € 59m. In relation to the second case, classified at 31.12.2009 among expired positions for € 59m, it is a position relating to companies that during the year were subject to corporate changes: repayments made during the year and a new majority shareholder allowed the positions to return to normal conditions. For further information related to “Information on Risks and related hedging policies” of cash and off-balance-sheet exposures of loans to clients, refer to Part E of the Banca Intermobilare Group financial statements at 31.12.2010.

26 • Consolidated Management Report FINANCIAL YEAR 2010

Exposure to banking system

Net financial position (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Receivables Current accounts and free deposits 65,938 266,415 (200,477) -75.3% Loans and time deposits 50,029 6,843 43,186 631.1% Income for operations on at sight derivatives 41,448 26,235 15,213 58.0% Debt securities 65,312 104,840 (39,528) -37.7% Securities lending and repos 26,707 29,868 (3,161) -10.6% Total due from banks 249,434 434,201 (184,767) -42.6% Payables Current accounts and other at sight deposits (67,113) (84,231) 17,118 -20.3% Loans and other forward debts (293,665) (314,462) 20,797 -6.6% Other payables (8,215) (1,484) (6,731) 453.6% Total due to banks (368,993) (400,177) 31,184 -7.8% Due from (to) Bank of Italy (74,411) (85,483) 11,072 -13.0% TOTAL NET FINANCIAL POSITION (193,970) (51,459) (142,511) 276.9%

The net financial position towards banks at 31.12.2010 was € 194m compared with debt position for € 51m at 31.12.2009. The significant increase in the net financial position is caused by the lower availability of deposits and other securities that occurred during the first quarter of this financial year. Operations with credit institutions were determined by very short term requirements for provision/use, typically in current accounts and overnight and short deposits as well as by the requirement caused by financial instruments transactions. Loans and other forward debts towards banks were mainly composed of a loan of € 245m taken out through syndicated lending in 2006 with 18 international banks that expired in February 2011 and was regularly repaid. The other payables are made up of € 30m of time deposits and for € 18m of other loans. Other loans consist of current accounts and at sight forward deposits for € 67m opened within major credit institutions. Banca Intermobiliare subscribes to the Collateralised Interbank Market and can participate in ECB CONSOLIDATED MANAGEMENT REPORT auctions. Such exposures are subject to continuous monitoring by rate and cash risk management strategies, described in the market information section, “Information on risks” of the consolidated directors’ report and in Part E, “Market risks” Section of the Notes to the Consolidated Accounts.

Consolidated Management Report • 27 FINANCIAL YEAR 2010

Financial Instruments

Financial instruments breakdown (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Portfolio of securities High frequency trading (Htf) 274,815 455,443 (180,628) -39.7% Trading liabilities (8,820) (7,289) (1,531) 21.0% Available-for-sale activities (Afs) 399,408 373,110 26,298 7.1% Held-to-maturity activities (Htm) 5,627 5,551 76 1.4% Debt securities (L&R) 70,806 115,089 (44,283) -38.5% Total securities portfolio 741,836 941,904 (200,068) -21.2% Derivatives portfolio High frequency trading (Htf) 139,481 76,882 62,599 81.4% Trading liabilities (140,709) (78,634) (62,075) 78.9% Total derivatives portfolio (1,228) (1,752) 524 -29.9% TOTAL FINANCIAL INSTRUMENTS 740,608 940,152 (199,544) -21.2%

A t 31.12.2010, the financial instruments portfolio recorded a decrease of 21.2% against a drop of € 181m of the trading portfolio and of € 44m of the Loans & Receivables portfolio; on the other side, the portfolio of available-for-sale securities recorded an increase of € 26m during the period. The derivatives portfolio, compared with the situation at 31.12.2009, registered a significant increase in volumes (approximately +80%) related to a growing interest by clients in these markets: the derivatives portfolio also consists of brokered positions on behalf of clients and balanced by the bank on the market; the net exposure between long-term and short-term positions remained in line with the values at 31.12.2009. Financial markets throughout 2010 were influenced by a strong speculative movement in the first part of the year towards government bonds issued byP ortugal, Ireland, Greece and Spain and, at the end of the financial year, towards corporate securities mostly involved in the recent crisis inM iddle-Eastern countries. In such a context, the Banca Intermobiliare Group did not have proprietary investments in these segments and therefore was not exposed at 31.12.2010 to debt securities issued by the governments of the aforementioned Countries. Below, investments in financial instruments per type of portfolio are listed.

CONSOLIDATED MANAGEMENT REPORT Financial assets held for trading (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Trading securities - Debt securities 252,787 435,793 (183,006) -42.0% - Share capital securities 16,562 11,421 5,141 45.0% - O.I.C.R. quotas 5,466 8,229 (2,763) -33.6% Total securities portfolio 274,815 455,443 (180,628) -39.7% Trading derivative instruments - Equity, index and currency derivatives 139,481 76,882 62,599 81.4% Total derivatives portfolio 139,481 76,882 62,599 81.4% TOTAL FINANCIAL Assets HELD FOR TRADING 414,296 532,325 (118,029) -22.2%

28 • Consolidated Management Report FINANCIAL YEAR 2010

The Banca Intermobiliare Group’s portfolio held for trading amounted to €/’000 414,296 at 31.12.2010, a decrease of 22.2% over 31.12.2009, mainly due to repayments and sale of debt securities. The Securities held for trading portfolio, accounting for 66% of the securities portfolio, consists of debt securities at 92% (mainly high rating Italian and European government bonds, corporate and bank bonds), equities at 6% and Oicr quotas at 2%. The derivatives held for trading portfolio mainly consists of derivatives on brokered exchange rates between clients and institutional counterparties. At 31.12.2010, trading volumes had increased compared to the previous year due to a greater interest by clients in this type of transaction.

Financial liabilities held for trading (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Cash liabilities 8,820 7,289 1,531 21.0% Derivative instruments 140,709 78,634 62,075 78.9% TOTAL FINANCIAL LIABILITIES HELD FOR TRADING 149,529 85,923 63,606 74.0%

Cash liabilities held for trading consist of a technical overdraft on equities amounting to €/’000 8,820. Derivative instruments, entered among financial liabilities for€ /’000 140,709, mostly consist of cross currency swaps balanced with similar derivative contracts on currencies, entered among financial activities held for trading for €/’000 139.481.

Financial assets available-for-sale (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Financial assets available-for-sale - Debt securities 295,239 276,833 18,406 6.6% - Share capital securities 42,213 36,349 5,864 16.1% - O.I.C.R. quotas 61,956 59,928 2,028 3.4% TOTAL FINANCIAL ASSETS AVAILABLE-FOR-SALE 399,408 373,110 26,298 7.0% CONSOLIDATED MANAGEMENT REPORT

The portfolio of available-for-sale securities at 31.12.2010 registered a net increase of €/’000 26,298 mainly related to Securities in the bond segment. The bond portfolio increased by €/’000 18,406 due to bank bond subscription (+49% y-o-y) and to the contemporaneous decrease in government bonds (-36% y-o-y). Slower increases were registered both in the equity subfund and in the mutual funds subscription. The portfolio breakdown at 31.12.2010 accounted for 74% of debt equities (allocated to the Treasury portfolio and mainly consisting of corporate and bank bonds issued by Italian and European banks and with medium/long-term maturity), 16% of O.I.C.R. quotas and the remaining 11% of equity securities (held for non-trading purposes).

During the financial year, the portfolio of available-for-sale financial activities was subject to an impairment test according to the method outlined in part A of the Notes to financial statements - Accounting policies - showing an impairment situation for 3 securities only, with an economic impact equal to €/'000 1.935.

Consolidated Management Report • 29 FINANCIAL YEAR 2010

Financial assets held to maturity The securities portfolio of held-to-maturity financial activities equalled €/’000 5,627 relating to a single bond investment listed on the Italian stock exchange market maturing in August 2011.

Loans&Receivable (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Loans & Receivables - Debt securities towards banks 65,312 104,840 (39,528) -37.7% - Debt securities towards clients 5,494 10,249 (4,755) -46.4% TOTAL FINANCIAL ASSETS LOANS & RECEIVABLES 70.806 115.089 (44.283) -38,5%

The Loans & Receivables securities portfolio consists of debt securities, mainly towards banks, unlisted on active markets, acquired as private placements and not for trading.

Outstanding securities (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Bond issues - structured 77,277 55,761 21,516 38.6% - other 333,805 302,505 31,300 10.4% Total bonds 411,082 358,266 52,816 14.7% Banker’s drafts 4,365 7,315 (2,950) -40.3% Total other securities 4,365 7,315 (2,950) -40.3% TOTAL OUTSTANDING SECURITIES 415,447 365,581 49,866 13.6%

Outstanding Securities, issued by the Parent Bank, mainly consist of bond issues amounting to €/’000 411,082 and €/’000 4,365 of banker’s drafts. The total debt for bond issues, after buy-backs, amounted to €/’000 441,739 after adding debt for €/thousand 30,023 in relation to equity component spin-off of the convertible bond (entered among equity as capital instruments) and

CONSOLIDATED MANAGEMENT REPORT the embedded derivatives evaluation for €/thousand 635 (entered among trading financial liabilities). Bond issues refer to unlisted Securities except for convertible bond issues dealt on the Milan Stock Exchange and amounting to € 164m (of which € 30m is considered equity).

Associates investments

Investments recorded at 31.12.2010 in the Banca Intermobiliare Group consolidated financial statements equalled €/thousand 5,950 and referred to the minority share in Bim Vita S.p.A. share capital. At 31.12.2010, the investments valued using the net equity method generated a profit in theL &P account of the Group’s consolidated data of €/thousand 27, accounting for 50% of the profit registered by Bim VitaS .p.A. in the twelve months of 2010.

30 • Consolidated Management Report FINANCIAL YEAR 2010

NON CURRENT ASSETS HELD for sale

A t 31.12.2009, Banca Intermobiliare entered on the balance sheet, according to the IFRS 5 accounting policy, groups of assets available for sale in the financial statements for€ /thousand 30,041 and liabilities associated with groups of assets available for sale for €/thousand 602, related to the full share capital of Società Immobiliare D S.r.l. For credit collection purposes, on 29 December 2009 the Parent Company, Banca Intermobiliare, took over the full share capital of Immobiliare D S.r.l. from Gruppo Zunino, which owns the building in Piazza Sant’Erasmo in Milan held for mortgage security for a credit exposure of € 33.7m to such group. In order to continue classifying the investment in accordance with the Ifrs 5 accounting policy, it is subject to the following conditions: i) the asset must be available for immediate sale in its present condition and the sale shall be highly likely; ii) The Board of Directors shall commit itself to a programme of asset disposal, actions to locate a buyer shall start and the programme shall be completed; iii) The conclusion of the sale shall be carried out within a year from the classification date, with the exception of the possibility to extend such a period if the delay is caused by events or circumstances outside the acquiring company's control and the latter remains committed to the disposal programme.

At 31.12.2010, considering that the aforementioned investment sale could not be estimated, the investment was reclassified from “groups of assets held for disposal” and “liabilities associated to groups of assets held for disposal” to “investment” with the subsequent line-by-line consolidation of the control investment.

Capital accounts

Consolidated equity (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Capital 156,209 156,038 171 0.1% Treasury shares (-) (34,416) (33,802) (614) 1.8% Capital instruments 30,023 30,023 - - Share premiums - 140 (140) -100.0% CONSOLIDATED MANAGEMENT REPORT Reserves 223,563 213,603 9,960 4.7% Valuation reserves 15,308 17,150 (1,842) -10.7% Net Profit (Loss) for the year 10,253 8,572 1,681 19.6% Group equity 400,940 391,724 9,216 2.4% Equity attributable to minority interest 9,188 10,780 (1,592) -14.8% Total equity 410,128 402,504 7,624 1.9%

The Group consolidated equity at 31.12.2010 amounted to € 401m (+2.4% y-o-y). The main changes in equity over 31.12.2009, apart from the profit (loss) for the year, refer to the minimum value of the valuation reserve of the portfolio of available-for-sale financial activities, whick decreased of €/thousand 1,842 in relation to fair value fluctuations.

Consolidated Management Report • 31 FINANCIAL YEAR 2010

Equity changes that occurred in 2010 are detailed below: (stated in EUR ‘000)

Equity at 31.12.2009 402,504 Share capital Stock granting issues to employees 172 Valuation reserves Valuation reserves for fair value adjustment Afs portfolio (7,118) Exchange rate spread of foreign consolidated companies 5,344 Profit from cash flow hedge derivative (92) Real estate disposal (135) Reserve company adjustments measured with the equity method: (73) Other reserves Purchase and sale of treasury shares (614) Profit from trading of own issued securities (156) Valuation of employee benefits according to Ifrs 2 542 Consolidation former Ifrs 5 294 Change on previous year’s profit/loss 431 Profit for the year 9,029 Equity at 31.12.2010 410,128 Equity attributable to minority interest 9,188 Group equity at 31.12.2010 400,940

Details of changes in consolidated equity for 2010 are reported in the specific table under the F“ inancial statements” Section. For details relating to treasury share movement and treasury share number and value, we send back to the information published in the Notes to the consolidated financial statements inS ection 15 of Part B, in addition to the information on equity contained in Part F "Information on consolidated equity”. CONSOLIDATED MANAGEMENT REPORT

32 • Consolidated Management Report FINANCIAL YEAR 2010

Comparison between profit for the year and Parent Bank’s equity and consolidated data (in €/thousands)

Profit for the year Equity

Parent Bank’s financial statements at 31.12.2009 13,872 353,866 Intercompany dividend avoidance (6,816) - Difference between investments values and their equity - (30,363) Goodwill - 63,336 Profit (loss) from cash flow hedge derivative 92 - Surplus value for Ifrs 3 allocated to Intangible Assets (Banca Ipibi) (1,687) 13,492 Reversal of Parent bank’s expenses on leased estate (owned by Bim Immobiliare S.r.l. (21) 10 Exchange differences for foreign subsidiary consolidation (Bim Suisse S.A.) - 5,900 Recovery of investments write-downs (Bim Immobiliare S.r.l.) (298) - Profits of consolidated companies 3,887 3,887 Consolidated financial statements at 31.12.2010 9,029 410,128 Equity attributable to minority interest 1,224 (9,188) Group consolidated financial statements at 31.12.2010 10,253 400,940

Regulatory capital At 31.12.2010, Banca Intermobiliare’s consolidated regulatory capital, calculated according to P&L figures determined by the application of IAS/IFFR international accounting policies, amounted to € 402m, decreasing by € 16m over the 2009 figure. Capital ratios amounted to 17% referring to Total capital ratio and to 11.5% relating to Tier 1 ratio, improving over the previous financial year.

2010 2009

Consolidated regulatory capital (millions of euro) 402 418

Total capital ratio 17.00% 15.61% CONSOLIDATED MANAGEMENT REPORT Tier 1 ratio 11.47% 9.87%

For further quantitative and qualitative information on regulatory and capital ratios, please see what has been published in the Notes to the consolidated financial statementsP art F “Information on consolidated capital”, Section 2.

Consolidated Management Report • 33 FINANCIAL YEAR 2010

Consolidated financial results

In the financial explanatory notes and comments below, reclassified financial results of the BancaI ntermobiliare Group for year 2010 have been analysed comparing them to the same period in 2009.

Net interest income (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Interest receivable - financial assets held for trading 10,703 11,419 (716) -6.3% - financial assets available-for-sale 8,167 9,686 (1,519) -15.7% - financial assets held to maturity 188 262 (74) -28.2% - on due from banks 4,501 8,514 (4,013) -47.1% - on loans to clients 37,216 46,115 (8,899) -19.3% - other 2 - 2 NA Total interest receivable 60,777 75,996 (15,219) -20.0% Interest payable - on payables due to banks and other financing bodies (5,904) (7,582) 1,678 -22.1% - on payables due to clients (10,217) (22,801) 12,584 -55.2% - outstanding securities (13,183) (15,175) 1,992 -13.1% - trading financial liabilities (2,343) (2,351) 8 -0.3% - other (2) (142) 140 NA Total interest payable (31,649) (48,051) 16,402 -34.1% NET INTEREST INCOME 29,128 27,945 1,183 4.2%

The decrease in interest rates recorded during 2010 concerned both interest receivable and interest payable, influenced by the market rate trends. At 31.12.2010 the net interest income increased by 4.2%, to €/'000 29,128, compared to €/’000 27,945 for the previous financial year, due to the combined effect of the balance-sheet figure trends (see the table “Quarterly evolution of consolidated balance-sheet figures”) and the conditions of market rate trends.

CONSOLIDATED MANAGEMENT REPORT During the last quarter, market conditions resulted in a slight recovery on income with reference to deposits and other securities, which had been totally counterbalanced in the recent past.

Net operating income (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % NET INTEREST INCOME 29,128 27,945 1,183 4.2% Net fees and commissions 70,757 71,064 (307) -0.4% Dividends 2,929 1,280 1,649 128.8% Net profit on trading instruments 15,592 18,089 (2,497) -13.8% Net profit on hedging instruments - 553 (553) -100.0% Net profit on other instruments disposal 7,098 13,445 (6,347) -47.2% NET OPERATING INCOME 125,504 132,376 (6,872) -5.2%

34 • Consolidated Management Report FINANCIAL YEAR 2010

The net operating income decreased by 5.2%, from €/’000 132,376 referred to 31.12.2009 to the current €/’000 125,504. The result, lower than the previous financial year, was influenced by minor results obtained from the disposal of available-for-sale financial instruments; the contribution of the net interest income was slightly higher than 2009, while the contribution of net fees and commissions remained stable overall.

Net fees and commissions (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Fees and commissions income - trading, management, order collection 43,409 40,037 3,372 8.4% - individual asset management 23,754 24,310 (556) -2.3% - collective asset management 25,118 27,119 (2,001) -7.4% - distribution of third-party services 15,126 9,210 5,916 64.2% - financial advisory 2,293 948 1,345 141.9% - other fees and commissions 4,129 6,402 (2,273) -35.5% Total fees and commissions income 113,829 108,026 5,803 5.4% Fees and commissions expenses - return to sales network and other distributors (34,014) (28,495) (5,519) 19.4% - trading and management (7,430) (6,086) (1,344) 22.1% - other services (1,628) (2,381) 753 -31.6% Total fees and commissions expenses (43,072) (36,962) (6,110) 16.5% TOTAL NET FEES AND COMMISSIONS 70,757 71,064 (307) -0.4%

Net fees and commissions for the financial year 2010 registered results in line with the previous year, amounting to €/’000 70,757 against €/’000 71,064.

Fees and commissions income at 31.12.2010 amounted to €/’000 113,829 and resulted from the assets under administration and custody segment for 38.1%, from products managed by the Group companies for 42.9%, from distribution of third-party services for 13.3% and from other transactions for 3.6%. The fees and commissions income result benefited mainly from the strong growth of distribution of third-party CONSOLIDATED MANAGEMENT REPORT services, of trading and of financial advisory services. In addition, recurring fees and commissions generated from asset management increased: for this product the total fees and commissions contribution decreased because of the performance commissions downsizing (around €/ 6m in 2010, around €/ 18m in 2009). Fees and commissions expenses amounted to €/’000 43,072, increasing over 31.12.2009. The most significant components are the remuneration of financial promoters and of other institutional distributors.F ees and commissions expenses retroceded to the network were significantly influenced by investments for developing Banca Ipibi Promoters' network.

Consolidated Management Report • 35 FINANCIAL YEAR 2010

Proprietary account total result (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Dividends and similar income - Dividends on trading portfolio 382 190 192 101.1% - Dividends on available-for-sale portfolio 2,547 1,090 1,457 133.7% Total dividends 2,929 1,280 1,649 128.8% Trading net profit (loss) - Trading financial assets/liabilities 8,203 14,234 (6,031) -42.4% - Other financial assets/liabilities: exchange rate differences (579) 347 (926) NA - Derivatives 7,968 3,508 4,460 127.1% Total trading net profit (loss) 15,592 18,089 (2,497) -13.8% TOTAL RESULT OF PROPRIETARY ACCOUNT 18,521 19,369 (848) -4.4%

The total result of proprietary account slightly decreased by 4.4% over the previous financial year amounting to €/’000 18,521. Dividends contribution was of €/'000 2,929, increasing over the previous financial year, mainly due to investments in available-for-sale securities, while the trading net profit (loss), of €/'000 15,592, decreased by 13.8%: a slower trading activity was balanced by the extremely positive result of the brokered derivatives portfolio.

Net profit (loss) on disposal of other financial instruments (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Profit (loss) on disposal of other financial instruments - financial assets 7,467 13,785 (6,318) -45.8% - financial liabilities (369) (340) (29) 8.5% TOTAL PROFIT (LOSS) OF DISPOSAL OF OTHER FINANCIAL INSTRUMENTS 7,098 13,445 (6,347) -47.2% CONSOLIDATED MANAGEMENT REPORT Finally, the net operating income benefitted from the positive result for €/’000 7,098, mainly thanks to the disposal of available-for-sale securities. In particular, equities generated profits for €/’000 6,001, while bond securities generated about €/’000 1,405. The significant decrease in results over 2009 is due to the disposal of equity investment inL se security which positively contributed for €/'000 6,712 in 2009. During the financial year the definitive disposal of the equity investment in Borsa Italiana S.p.A. (subsequently exchanged with Lse shares) was perfected, with a positive impact on this financial year equal to €/’000 1,829.

36 • Consolidated Management Report FINANCIAL YEAR 2010

Operating profit (loss) (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % NET OPERATING INCOME 125,504 132,376 (6,872) -5.2% Operating costs (99,568) (95,665) (3,903) 4.1% OPERATING PROFIT (LOSS) 25,936 36,711 (10,775) -29.4%

The operating profit (loss) amounted to€ /’000 25,936, decreasing by 29% over the previous financial year. The expense/income ratio (including other operating income/charges) amounted to 79.33% (72.27% y-o-y).

Operating costs (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Administrative overheads - personnel costs (56,715) (55,665) (1,050) 1.9% - other administrative overheads (37,742) (35,149) (2,593) 7.4% Operating amortisation and depreciation (8,238) (8,583) 345 -4.0% Other operating income/charges 3,127 3,732 (605) -16.2% OPERATING COSTS (99,568) (95,665) (3,903) 4.1%

P ersonnel costs amounted to €/’000 56,715 at 31.12.2010, consisting of salaries and related charges of employees and the remuneration of directors and Statutory Auditors. The variable part of the compensation of employees belonging to the commercial network has been reclassified among fees and commissions expenses, in order to give a better management representation. Compared to the charge registered in the previous financial year, the annual increase was limited to 1.9%.

Other administrative overheads amounted to €/’000 37,742, increasing over the previous period. The increase of 7.4% is mainly due to a higher charge for insurance policies, costs to manage real estate and lease of machines and software. With reference to expenses for external advisory services, apart from a slight increase in legal costs, expenses for organisation and information advisory services sharply decreased. CONSOLIDATED MANAGEMENT REPORT

Operating amortisation and depreciation, equal to €/’000 8,238 at 31.12.2010, decreased by 4% over the previous financial year.D uring the year no significant investments in tangible and intangible assets were registered and no impairment situations occurred.

Other operating income/charges amounted to €/’000 3,127, a decrease compared to 31.12.2009, but generally on the increase considering that the previous financial year was positively influenced by an extraordinary income (equal to€ 2.2m relating to insurance compensation).

Consolidated Management Report • 37 FINANCIAL YEAR 2010

Current result In order to make the reclassified profit and loss account more clearly readable, the current result is shown as"result before non-recurring components" which is the operating profit (loss) less value adjustments on loans, net provisions for liabilities and charges and subsidiaries’ result valued using the equity method.

Profit (loss) before non-recurring components (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % OPERATING PROFIT (LOSS) 25,936 36,711 (10,775) -29.4% Net value adjustments on loans (4,443) (18,221) 13,778 -75.6% Net provisions for liabilities and charges (3,237) (11,909) 8,672 -72.8% Net profit (loss) of subsidiaries valued using the equity method 27 345 (318) -92.2% RESULT BEFORE NON-RECURRING COMPONENTS 18,283 6,926 11,357 164.0%

The result before non-recurring components amounts to €/'000 18,283, strongly recovering compared to €/’000 6,926 recorded at 31.12.2009, due to fewer net value adjustments on loans and to fewer net provisions for liabilities and charges introduced in the period: the total amount of net value adjustments on loans and of net provisions for liabilities and charges amounts to €/’000 7,680, against €/’000 30,130 related to 2009 (-74.5% y-o-y). During the 2009 financial year, the economic and financial crisis made clients’ credit standing worse, with subsequent increases in value adjustments on loans and provisions for liabilities and charges.

Net value adjustments on loans at 31.12.2010 amount to €/’000 4,443. In particular, total provisions for €/’000 15,186 were allocated on impaired situations in order to have position updates analytically valued both in terms of collection of guarantees and by quantifying the charge related to the resolution time for doubtful loans. Write-backs amounted to €/’000 10,792, crried out against to the repayment of some exposures, among which Gruppo Coppola and Partecipazioni Immobiliari, due to the time-value effect.

Net provisions for liabilities and charges amount to €/’000 3,237 against a balance of €/’000 11,909 related to 31.12.2009. Provisions mainly relate to legal cases liabilities, clients' complaints and other liabilities. At the same time, write-backs were made because of the judicial and extra judicial resolution of some legal cases and complaints. CONSOLIDATED MANAGEMENT REPORT Net charges included in the financial statements are also influenced by the time-value effect.

The result of investments valued with the equity method is mainly due to the pertaining share of Bim Vita S.p.A. (50% investment with Fondiaria-Sai).

38 • Consolidated Management Report FINANCIAL YEAR 2010

Profit (loss) before tax (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % RESULT BEFORE NON-RECURRING COMPONENTS 18,283 6,926 11,357 164.0% Profit (loss) from disposal and value adjustments (1,935) 5,704 (7,639) NA on financial instruments Profit (loss) from investments disposal 996 - 996 NA PROFIT (LOSS) BEFORE TAX 17,344 12,630 4,714 37.3%

Profit before tax amounts to €/’000 17,344 against a result of €/’000 12,630 which was influenced by the positive results related to the Management & Capital transaction.

The result of disposal and value adjustments on financial instruments consists of value adjustments introduced for the impairment of available-for-sale financial assets.A t 31.12.2010 the results of impairment tests showed an impairment loss equal to €/’000 1,935, of which €/’000 1,050 was due to the negative adjustment to fair value of two listed securities held by the parent bank already subject to impairment in the previous financial years and €/’000 885 for impairment of a minority stake held by Banca Ipibi.

The result of investments disposal relates to the disposal of 100% of shares of Parioli Sviluppo S.r.l., company acquired during the year by the parent bank as part of a credit collection transaction and sold within the end of the year.

At 31.12.2010, impairment tests were carried out to assess the possibility of collecting amounts entered as goodwill against company acquisition transactions occurred during the previous financial years, without revealing impairment situations. For further information see qualitative information in the Notes to the consolidated financial statements in Part A - Accounting policies and in Part B - Section 13 “Intangible Assets”.

Profit (Loss) of current operations after tax (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % PROFIT (LOSS) BEFORE TAX 17,344 12,630 4,714 37.3% CONSOLIDATED MANAGEMENT REPORT Income taxation (8,315) (6,616) (1,699) 25.7% Profit (Loss) of current operations after tax 9,029 6,014 3,015 50.1%

Against the current and deferred fiscal charge, calculated as always on the evolution of the reference tax regulations, the consolidated profit for the year amounts to€ /'000 9,029, against a result of €/’000 6,014 of the previous financial year.

Consolidated Management Report • 39 FINANCIAL YEAR 2010

Net profit (Loss) for the year (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Profit (Loss) of current operations after tax 9,029 6,014 3,015 50.1% Profit (Loss) of discontinued operations after tax - 1,154 (1,154) -100.0% Net profit (Loss) for the year 9,029 7,168 1,861 26.0%

As already described above, at 31.12.2010 Immobiliare D investment was reclassified, after acquisition as part of a credit collection transaction from Gruppo Zunino, from "groups of assets held for disposal" and "liabilities associated to groups of assets held for disposal" to line by lineconsolidation, considering that the terms of sale of the aforementioned investment cannot be estimated yet. The comparative figure related to profits for assets held for disposal relates to the disposal ofIPI S.p.A investment.

Group net profit (Loss) for the year (stated in EUR ‘000) 31.12.2010 31.12.2009 Change Change amount % Net profit (Loss) for the year 9,029 7,168 1,861 26.0% Loss attributable to minority interest 1,224 1,404 (180) -12.8% Group net profit (Loss) for the year 10,253 8,572 1,681 19.6%

The Group net profit for the year amounts, after the loss attributable to minority interest (for minority interests of the Banca Ipibi S.p.A. and Bim Insurance Brokers S.p.A. subsidiaries), to €/’000 10,253 as opposed to €/’000 8,572 for the previous financial year.

Total consolidated comprehensive income (stated in EUR ‘000) CONSOLIDATED MANAGEMENT REPORT 31.12.2010 31.12.2009 Change Change amount % Net Profit (Loss) for the year 9,029 7,168 1,861 26.0% Available-for-sale financial assets (7,119) 12,065 (19,184) NA Exchange rate differences 5,351 40 5,311 132.78 Other minor changes (498) 226 (724) NA Total consolidated comprehensive income 6,763 19,499 (12,736) -65.3%

The total consolidated comprehensive income amounts to €/’000 6,763 after adjusting the net profit for the year equal to €/’000 9,029 with the following changes: €/’000 7,119 for write-backs of fair values of available-for-sale securities (Afs); €/’000 5,351 for positive exchange rate differences on currency investments, €/ 498 for other minor negative changes.

40 • Consolidated Management Report FINANCIAL YEAR 2010

Results of investments

Below is a summary of the financial and equity trends of BancaI ntermobiliare’s subsidiaries; for inter-group transactions see the Notes to the consolidated financial statements P( art H -Transactions with related parties) and the business consolidated contribution (Part L - Segment information).

SYMPHONIA SGR S.p.A. Symphonia SGR was established in 1994 by Angelo Abbondio. As a result of its founder's personal initiative, it is now the asset management company of the Banca Intermobiliare Group following the merger of Bim Sgr into Symphonia Sgr. At the end of 2009, following the BIM Alternative Investments SGR merger, the corporate rationalizing process was realized. Symphonia's offer is particularly varied, both in collective products (traditional or alternative) and individual products. The offer for traditional collective products is based on the following platforms: - sicav Symphonia, 10 subfunds; - multisicav Symphonia, 7 subfunds; - mutual funds, 25 Funds (BIM and Synergia); - sicav Symphonia Lux, 8 subfunds; The offer for Speculative Products consists of the following products: - Symphonia Arbitrage Europe; - Symphonia Equity Long Short; - Fenice; - Thema. In January 2010, two new subfunds were set up on the platform of Symphonia Lux CIUs Also during 2010, the authorisation to introduce a new speculative product was requested; this product became operational in January 2011. However, starting from 1 January 2011, a merger of three Symphonia Sicav subfunds was carried out. The offer for Individual Asset Management services, which represent two thirds of the total volumes managed by SGR, consists of different types of products: - Traditional asset management in securities (equity, bond, balanced securities); - portfolio Strategy, asset management group based on the building blocks concept; - flexible asset management. During 2010, Symphonia SGR worked with its partners to put its productive capacity at disposal, realizing for them a range of competitive asset management services, suitable for a world in continuous evolution. CONSOLIDATED MANAGEMENT REPORT For this purpose, it also created an autonomous commercial structure to support distributor networks. Below are the highlights at 31.12.2010: • Total client assets equal to € 4,589m (€ 4,162m +10.3%) - of which for individual products for € 2,622m (€ 2,567m) - of which for CIUs for € 1,026m (€ 835m) - of which for Sicav, Multisicav and Pension funds for € 941m (€ 741m) • Net fees and commissions equal to € 21.3m (€ 26.5m y-o-y). • Net profit for the year equal to € 6.2m (€ 10.8m y-o-y) • Operating profit (loss) / Net operating income at 44.1% (54.9% y-o-y) • Cost/Income ratio at 55.9% (44.5% y-o-y) • Equity equal to € 52.7m (€ 42.1m y-o-y) • ROE at 3.3% (4.3% y-o-y)

Consolidated Management Report • 41 FINANCIAL YEAR 2010

BANCA IPIBI S.p.A. In 2010 Banca IPIBI intensified the scheduled development plan which, between 2010 and 2013, forecasted a significant increase in assets and a gradual return to a positive economic result. The advisory-based business plan, which has become the Bank's core product, is meeting the interest of high-standing Financial Promoters looking for the possibility of creating a strong partnership with small entities, the full autonomy of private banker activity, high consideration of human capital and the use of a particularly simple structure which allows direct relationship and quick execution responses between Central Management and the Network. Banca IPIBI, which celebrates its 10th anniversary in 2011, operates in 9 Italian regions through 3 operating branches (Milan, Turin and Rome), 28 Financial Promoters offices and 7 Private Offices, with a total network of 167 Private Banker advisors. All clients are advisory-managed with a multibrand offer consisting of a portfolio of products that is always being updated because of new commercial distribution agreements decided with the main national and international product companies. Such offer is always widened by placing the highest quality products of the Banca Intermobiliare Group (Symphonia asset management, BIM VITA insurance policies, Synergia Funds, Symphonia’s SICAV Multisicav). To support the Bank's important expansion, significant interventions have been carried out in order to support the Central Structure, replanning the Bank's organisational function chart. The main interventions concerned: • the creation of a decentralized Back Office and an Administration Department at the new Rome branch; • the implementation of a stronger Auditing Service and Compliance Service as well as a deep reorganisation of the Sales and Marketing Department, with a new Business Coordinator, the creation of the Deputy Director's new role and the establishment of two Areas (Products and Services and Bank Synergies) in order to better control the Network’s expansion; • issue of share capital for € 7.5m (of which 4.95 as share premium) for all shareholders and deliberated during the recent extraordinary shareholders’ meeting of 11 February 2011. The undergoing development process is confirmed by the significant increase in managed assets from € 1.18b to € 1.54b (+30.9%), almost totally due to net inflows, the benefit from the market effect being insignificant. Total client assets in 2010 were a considerable result for the Bank, ranking it first in the Assoreti's national list as pro-capita net inflows with more than € 2.1m. In addition to asset growth, the number of client relationships grew from 7,980 in 2009 to 9,135 in 2010, increasing by almost 15% annually, after introducing 46 new professionals and after developing new clients through the existing network. A sharp increase in asset profitability of the Bank for 16 bps must also be highlighted, going from 1.40% in 2009 to 1.56% in 2010, equal to a growth of 11.4%. The profit and loss account result is negative in regard to its ordinary component, despite a sharp increase

CONSOLIDATED MANAGEMENT REPORT in fees and commissions income from € 11.8m to € 18.5m (+56.1%) and net fees and commissions growth from € 3.2m to € 4.9m (+53,6%). Investments in development, relating in particular to bonus costs given to Advisors for the introduction of new assets, significantly influenced fees and commissions expenses. The total amount of bonuses, together with the reward plan for the existing network for acquiring new assets, is about € 2.29m. An extraordinary component due to the write-down of a bank’s historical investment shall be added for around €/’000 885. Here are the main highlights at 31.12.2010: • Net inflows: € 323.3m (€ 196.3m y-o-y, +64.7%);Net operating income: € 8.0m (€ 5.9m y-o-y, +35.7%); • Loss for the period: € 2.3m (€ 2.7m y-o-y, -16.3%).

42 • Consolidated Management Report FINANCIAL YEAR 2010

B Anca IntermoBILIARE DI INVESTIMENTI E GESTIONI (SUISSE) S.A. Banca Intermobiliare di Investimenti e Gestioni (Suisse) S.A. provides private banking services on the Swiss territory both for domestic clients and for the Parent Bank's institutional clients. The company mainly operates in the asset management field on behalf of private and institutional clients. It also provides strictly related services, namely brokerage of securities and currencies (for own account and on behalf of customers) and investment advisory services. Loan activity mainly relates to “Lombard” loans, therefore as credit lines in current accounts against guarantees. Here are the main highlights at 31.12.2010 • Net interest income equal to CHF 1.1m (CHF 1.7m y-o-y); • Net fees and commissions amount to CHF 5.5m (CHF 8.6m y-o-y); • Net profit amounts to CHF 0.06m (CHF 1.4m y-o-y); • Operating profit (loss) / Net operating income at 2.5% (17.6% y-o-y) • Cost/Income ratio at 97.5% (82.4% y-o-y) • ROE at 0.16% (3.4% y-o-y)

BM I Fiduciaria S.p.A. The company provides static trust services, namely offering administration services, with or without heading, of assets on behalf of third parties, implementing shareholders agreements, granting option decisions to third parties, pledging on assets managed through trusts, reorganizing equity by setting up Parent Bank companies, giving common representation to savings debt holders and shareholders, giving individual representation to shareholders and debt holders in executing their rights, issuing registration forms to participate to shareholders’ meetings and domiciling registered office of companies. The 2010 activity continued at high pace due to the inflows of the so-called “Tax Amnesty”, a legislative provision which allowed the legalisation of assets illegally held abroad with the subsequent regularisation of the taxpayer’s fiscal position; it began at the end of 2009 and ended during 2010 when legalised transactions for assets held abroad by clients were managed and perfected. Throughout 2010, the company provided an intensive highly specialized advisory service to the clients in order to not only analyse and perfect repatriation transactions, but also to plan post-amnesty operations. Great commitment, confidentiality, devotion and high qualification of the staff who worked on this initiative allowed the Banca Intermobiliare Group to achieve a significant contribution in terms of regulated volumes. There is a relationship of continuous cooperation with Veneto Banca Group's commercial network which has the possibility to attract inflows by offering the services in which Bim Fiduciaria is specialized, always meeting the highest commitment and confidentiality standards. The financial year at 31 December 2010 was particularly positive for the Bank, both in terms of profits and in terms of managed assets: CONSOLIDATED MANAGEMENT REPORT • Assets managed through trusts amount to € 845m (€ 667m y-o-y) • Net fees and commissions amount to € 0.5m (€ 0.3m y-o-y) • Profit (loss) on ordinary activity/ Net operating income 17.2% (28.5% y-o-y).

BM I Insurance BROKERS S.p.A. Bim Insurance Brokers, an insurance brokerage company set up at the end of 2006 and operational since the beginning of 2007, immediately performed well, working on the Banca Intermobiliare’ portfolio of policies and bringing great advantages to the whole Group, both for savings on insurance premiums and for wider hedges, in comparison with the past. A new company has therefore been created within the parent bank. Such company, on one hand, has worked to optimize the bank's insurance coverage, and on the other it has provided a service to all Bank's staff without impacting on its costs.

Consolidated Management Report • 43 FINANCIAL YEAR 2010

A t the same time, the outside work on assets, partly on clients identified by the Bank’s structures, but mostly on new clients acquired outside the bank circuit thanks to collaborators working with our Company, has greatly developed. In particular, it was very useful to have a direct “binder” for third party insurance in London, such as Lloyd’s Cover Holder, which was sold directly to our clients, but also to other brokers, making our Company a wholesale broker selling services. All insurance fields, with the exception of reinsurance, are now covered in the best way; due to new collaborators, professionals with high specialization in each field, so as to always guarantee an appropriate response to the client. Finally, Bim Insurance Brokers invested and is still investing on the structure, necessary to take up all future challenges, to meet future clients’ expectations and, obviously, to continue expanding. At 31.12.2010 the company increased its market position registering brokerage commissions equal to €/’000 1,086 growing of 43% compared to €/’000 762 of the previous financial year. Banca Intermobiliare Group’s interest amounts to 51% of its share capital.

BM I Vita S.p.A. Bim Vita S.p.A. is an insurance-bank company within the Group, established in 2001 following an agreement between Banca Intermobiliare and Gruppo Fondiaria-Sai with the aim of providing a complete service to the clients, integrating the knowledge and values of two economic entities in the search for solutions in the pension and savings areas. As for equity results, the Company confirmed the volumes of managed assets deriving from insurance policies. Below is a summary of the range of services provided by the company per insurance field: - Savings: Bim guaranteed annuity, Bim Vita guaranteed assets, Bim Vita Free Finance and Bim Vita Free Funds; - Pension planning: Bim Vita open pension fund.

BM I ImmoBILIARE S.r.l. The company was set up in 2001, with the aim of acquiring and managing the real estate of Banca Intermobiliare Banking Group: currently, managed real estate consists of properties in the city centre of Turin, partly used as Banca Intermobiliare Management’s offices, and of branch offices in Milan, Via Meravigli, in Rome, Parioli area and in Cuneo. CONSOLIDATED MANAGEMENT REPORT

Information on risks and factors influencing profitability

As explicitly required by the Financial Stability Forum in April 2008, and by the Regulatory Body with the publication of the first update of the memorandum of Banca d'Italia on 18 November 2009, below is a summary of the impacts of the main financial risks on equity and financial results of the BancaI ntermobiliare Group and in particular on "Additional information" focusing on risk areas, products and other significant operating issues. For further information and details, see the disclosure of the memorandum 262 of Banca d’Italia and in particular the Notes to the consolidated financial statementsP art A (with reference to accounting policies used to prepare the financial statements) and Part E (for qualitative and quantitative information on risks and related hedging policies).

44 • Consolidated Management Report FINANCIAL YEAR 2010

Credit risk As for loans to clients, mainly aimed at supporting the investment activity and/or clients' asset management, Banca Intermobiliare Group increased the volumes of performing loans, also due to the repayment of some credit exposures. In order to limit risk, corrective action has been intensified, such as: integrating guarantees with less-exposed-to- market volatility securities, increasing in guarantee spreads; rotating re-estimate of real estate assets obtained as guarantee; daily monitoring of most significant positions as well as overdue payments. As for credit risks related to the significant exposure towards clients operating in the real estate business, during the financial year the risk position was reduced through partial, albeit significant, repayments of some positions.

Following the regulatory update in the memorandum 263 of Banca d’Italia published in December 2010, Banca Intermobiliare calculated the number and the amount of the so-called “significant exposures” considering as an exposure an amount equal to or higher than 10% of supervisory capital without applying weighting factors. The new calculation method registered a growth to 15 significant exposures (they were 5 at 31.12.2009) for a total amount of €1,010m. (€ 402m at 31.12.2009). Among significant exposures: - no. 1 exposure for doubtful loans for € 116m (weighted € 116m) - no. 3 exposures for group companies for € 204m (weighted € 91m) - no. 2 exposures towards institutions (Italian Government and Cc&g) for € 153m (weighted € 0.08m) - no. 1 exposure towards a primary Italian bank for € 67m (weighted € 25m) - no. 7 exposures towards high range private clients for € 507m (weighted € 283m) About the latter, such exposures are constantly monitored by Banca Intermobiliare Group corporate bodies and fully assisted by real estate and transferable securities warranties.

For further information on policy and techniques of risk management see Part E - Section 1.1 Credit Risk of the Notes to the consolidated financial statements.

Market risk The first part of the year was characterized by a lack of trust in the debt sustainability for some countries of theE uro area, namely for Greece. This offset high volatility reflected not only on sovereign bonds, but also on the stock market (Ftse Mib lost around 20% between April and May). Banca Intermobiliare Group was not exposed to the so-called PIGS risk through proprietary investments in sovereign bonds, thus avoiding to take highly speculative positions. Further consequence of doubtful loans of some European countries was the sharp drop of the Euro against the Dollar (the exchange rate reached the minimum level of 1.1923). The Group's main exposure in dollars was its own bond issue, which was promptly associated with a management hedging Cross Currency Swap which cancelled the CONSOLIDATED MANAGEMENT REPORT exchange rate effect of liability in dollars. In the first semester interest rates inverted, and after reaching minimum levels inM arch, they increased again, pushed by the first reabsorption of cash that theEC B itself had pumped into the system. Trading Book rate risk was greatly reduced between the first and the second quarter, while Banking Book bond rate risk remained the same, as greater fixed-rate exposures are covered by Interest Rate Swaps. In the second semester, after the sharp decrease of the last months, equity markets generally recovered even if the risk hedging average cost towards PIGS countries reached new peaks at the end of the year (495 bps). The Bank did not take any risk positions towards these countries, reducing also the exposure towards the Italian Government in HFT portfolio, from total assets of € 38m, to one of € 2m. The Euro rates continue increasing, 3-month Euribor has registered an increase of 30% in the last 6 months. The BIM portfolio which is most exposed to rate risk is AFS portfolio, regardless the increase of around € 50m, it did not register significant mark to market movements, thanks to the switch of many fixed rate positions to floating rate positions.

Consolidated Management Report • 45 FINANCIAL YEAR 2010

As for Forex, in the third and fourth quarter, the Euro started to strengthen against other currencies. The only currency exposures of the Bank are some new issues in Turkish Lira and in Norwegian Krone issued in the fourth quarter and appropriately management-hedged through Cross Currency Swap contracts.

Liquidity risk The Exit Strategy was postponed in 2010 by both the ECB and by FED, guaranteeing a good liquidity level that has flown particularly into the equity market and in raw materials. During the year, Banca Intermobiliare Group increased the total assets given to the Collateralized Interbank Market, which is becoming more and more important in volumes and number of subscribing institutions. On overnight loans, stress phases were not registered; however, the security balance for overdraft was increased in order to guarantee a high level of liquidity in less favourable contexts. In the last quarter, an issuing plan commenced, mainly related to the Eonia rate, in order to face the imminent extinction of the syndicated loan, promptly reimbursed.

Credit structured products considered risky by the market Below is some additional information on investments that the market considers to be highly risky because of the financial crisis that originated fromA merican subprime mortgage loans and on derivative trading with clients. In particular we refer to the indications of Bank of Italy (communication of 18 June 2008) and of Consob (letter of 23 July 2008) and we consider recommendations of the 2008 Financial Stability Forum’s Report which both Regulatory Bodies recall. Below is information at 31 December 2010 on: i) credit structured products - no existing position. ii) operations through Special Purpose Entities (SPE) - no existing position. iii) operations on derivatives with clients and related counterparty risk - fair value calculation of OTC financial instruments, including those traded with clients, is carried out using valuation models and methods that are explained in the Notes to the consolidated financial statements -P art E. The activity of the BIM Group in OTC derivatives with clients requires the signature of a specific margin contract by the client who wishes to operate on derivatives and the risk LLA GESTIONE CONSOLIDATA exposure is monitored through the degree of risk, represented by the relationship between requested margins and assets U available within the institution, which shall not exceed 50%. The main types of OTC derivative products traded with clients are represented by currency options, commodity options, interest rate swaps and currency forward contracts. Considering only the exposures with clients at 31.12.2010, the Group presented, in relation to derivative brokerage activity, a positive fair value for € 25.3m (€ 30.7 y-o-y), fully guaranteed by margins paid by clients and daily monitored by Risk Management and by the Parent Bank’s Middle Office. Financial markets throughout 2010 were influenced by a strong speculative movement in the first part of the year towards government bonds issued by Portugal, Ireland, Greece, and Spain and towards the end of the financial year to corporate bonds more involved in the recent Middle Eastern countries crisis. The Banca Intermobiliare Group did not RELAZIONE S have proprietary investments in these segments and therefore was not exposed at 31.12.2010 to debt securities issued by the governments of above mentioned Countries.

With regard to the method of fair value valuation see the Notes to the consolidated financial statements -P art E.

46 • Consolidated Management Report FINANCIAL YEAR 2010

D evelopment and organisation activitiesI

Entry into the Veneto Banca banking group

The merger through acquisition of Cofito into Veneto Banca, agreed on 18.02.2011, was registered on theC ompany Registers of Treviso and Turin on 25.02.2011. Since 25.02.2011 the aforementioned merger has become effective and therefore: (i) BIM and its subsidiaries (Symphonia SGR, Banca Ipibi, Bim Fiduciaria, Bim Suisse S.A. and Patio Lugano S.A.) became part of the Veneto Banca banking Group and are subject to management and coordination of Veneto Banca S.c.p.a.; (ii) the other BIM's subsidiaries, not belonging to the banking group but controlled by it, are now subject to Veneto Banca’s management and coordination, in accordance with tax regulations under art. 2497 et seq. of the Civil Code.

Incorporation of Banca Intermobiliare into Veneto Banca Group

I n order to plan the integration of Banca Intermobiliare into Veneto Banca Group during the second part of the year, BIM and Veneto Banca’s management team dealt with the following activities: i) identification of macro gaps related to existing organizational models and information systems within the two companies; ii) identification of objectives to be reached in the “Transitory phase” (before incorporatingC ofito into Veneto Banca), among which definition of information flows between BancaI ntermobiliare and Veneto banca and vice versa, inputs to forward projects (structure and instruments) and drawing up of subsequent operating proposals. iii) planning the migration process of Bim's information system into Veneto Banca’s and integration with department applications.

A dvisory activity

D ue to the strategic importance of advisory services and recent innovations introduced by the Markets in Financial Instruments Directive’s regulations, in order to further appreciate the Group’s core business and come to a more diversified offer relating to different client categories, a reconstructing and reorganisational project of the operating structures for advisory service was started last year. Such project, which is a medium-term project, will aim, among other CONSOLIDATED MANAGEMENT REPORT tasks, to review the range of offered activities, specific training activities of involved people and to generally update existing processes.

Symphonia’s products

During 2010, Symphonia began to manage two new Luxembourg sub-funds of Symphonia Sicav Lux: Value Sub Fund and High Value Sub Fund. Following the agreement signed with Veneto Banca to allocate Synergia harmonized open-ended mutual funds, Symphonia perfected the allocation agreement of Nuovi Orizzonti asset management which will be collocated within the first semester of 2011. On 3 January 2011, a new speculative fund, called Symphonia Long Term Families Fund became effective and it obtained approval by Bank of Italy on 22 October 2010.

Consolidated Management Report • 47 FINANCIAL YEAR 2010

The operating structure and personnel The total resources operating for Banca Intermobiliare Group on 31.12.2010 are equal to 896 people, of which 674 employees. Total employed and non-employed private bankers are 351.

31.12.2010 31.12.2009 of which: of which: Total private bankers Total private bankers Employees Managers 41 8 43 9 Middle Managers 309 125 292 123 Employees 324 - 320 - Total 674 133 655 132 Promoters and collaborators Banca Intermobiliare’s Private Bankers 56 56 61 61 Banca Ipibi’s Private Bankers 162 162 139 139 Other non-commercial collaborators 4 - 6 - Total 222 218 206 200 Total resources 896 351 861 332

With reference only to employees, the evolution was the following: a Corporate Governance 31.12.2009 Resignations Recruits Change of 31.12.2010 categories (a) Managers 43 (3) - 1 41 (b) Middle Managers 292 (15) 10 22 309 (c) Employees 320 (26) 53 (23) 324 Total employees 655 (44) 63 - 674

Banca Intermobiliare Group has 29 operating branches in Italy. The Banca Ipibi subsidiary has three operating units in Milan, Turin and Rome, 28 offices ofF inancial Promoters and 7 Private Offices. The Group is also present in Switzerland through the Banca Intermobiliare di Investimenti and Gestioni Suisse subsidiary. CONSOLIDATED MANAGEMENT REPORT

48 • Consolidated Management Report FINANCIAL YEAR 2010

Management and auditing activities La Corporate Governance Corporate Governance Banca Intermobiliare adopts the traditional model of corporate governance (Board of Directors and Independent Auditors). The Board of Directors, appointed by the shareholders’ meeting of 23.04.2010 and in office until the financial statements at 31.12.2010 is approved, at present, is made up as follows: - Roberto Ruozi chairman independent - Flavio Trinca Vice Chairman non Executive - Pietro D’Aguì chief Executive Officer executive - Franco Antiga director non Executive - Angelo Ceccato director non Executive - Vincenzo Consoli director non-executive - Matteo Cordero di Montezemolo director non Executive - Mauro Cortese director independent - Massimo Malvestito director non Executive - Giuseppe Santonocito director non Executive - Luigi Terzoli director non Executive

The Board of Directors on 23.04.2010 incorporated the Internal Control Committee and the Appointments and Remuneration Committee, which are also in office until the financial statements at 31.12.2010 are closed and are made up of:

Internal Control Committee: - Roberto Ruozi (Committee’s Chairman) independent advisor - Mauro Cortese independent advisor - Angelo Ceccato non-executive advisor - Giuseppe Santonocito non-executive advisor

Appointments and Remuneration Committee: - Roberto Ruozi (Committee’s Chairman) independent advisor

- Mauro Cortese independent advisor. CONSOLIDATED MANAGEMENT REPORT - Angelo Ceccato non-executive advisor

I nformation on community controlling credit institutions With effect from 25 February 2011 Banca Intermobiliare is legally controlled by Veneto Banca S.c.p.a. with registered office inM ontebelluna (TV) in Piazza G.B. Dall’Armi no. 1 and belongs to the banking group controlled by the latter. In Section H of the Notes to the separate financial statements the information requested byA rt. 2497- bis paragraph 4 is provided.

Consolidated Management Report • 49 FINANCIAL YEAR 2010

Adjustment to conditions under art. 36, Consob Regulations no. 16191/2007 (Listing of parent companies' shares set up and regulated by the Non-European Countries law)

U nder art. 2.6.2, paragraph 12, of the Organised and Managed by Borsa Italiana Stock Market Regulations, the Board of Directors states that Banca Intermobiliare, with reference to the company directly and totally controlled by Banca Intermobiliare di Investimenti e Gestioni (Suisse) S.A. - Lugano, set up and regulated in accordance with the Swiss Law, has adapted to the conditions established by paragraph 1 of art. 36 of the Consob Regulations 16191/2007.

Patio Lugano S.A., directly controlled by Banca Intermobiliare di Investimenti e Gestioni (Suisse) S.A., is not significantly relevant under art. 36 of theC onsob Regulation 16191/2007.

Declaration under art. 37, Consob Regulation no. 16191/2007 (Conditions that prevent the share listing of subsidiaries subject to management and coordination control of other companies)

U nder art. 2.6.2 paragraph 13 of the Organised and Managed by Borsa Italiana Stock Market Regulations, the Board of Directors states that, starting from 25 February 2011, Banca Intermobiliare is subject to management and coordination activity of Veneto Banca S.c.p.a. with registered office inM ontebelluna (TV) in Piazza G.B. Dall’Armi no.1 and none of the inhibiting conditions under art. 37 of the Consob Regulation 16191/2007 exists.

The necessary resolutions for adjustment to the provisions of paragraph 1, letter d) of the aforementioned article 37 of Consob Regulation 16191/2007 that are being prepared for the Internal Control Committee and the Appointments and Remuneration Committe- shall be adopted according to the terms of paragraph 1-ter of the above mentioned article (within thirty days after the shareholders meeting that shall be called to renew the current Board of Directors, in office until the financial statements at 31.12.2012 are approved).

R eport on corporate governance and ownership arrangements The annual report on Corporate Governance and ownership arrangements (2011 edition), approved by Banca Intermobiliare's Board of Director under art. 123 bis, paragraphs 1 and 2, Legislative Decree 58/1998, is published CONSOLIDATED MANAGEMENT REPORT in the issuer’s web site (Corporate Governance section), under paragraph 3 of the same article.

C onsob Communication no. 11012984 of 24 February 2011

With reference to Consob communication no. 11012984 of 24 February 2011, whose subject is “remuneration and succession planning of listed companies’ managing directors", such information is reported in Part H “Operations with associated parties” of the Notes to the separate financial statements of BancaI ntermobiliare and for further details in the “Report on corporate governance” section. At present, there haven’t been between the Issuer and the Managing Directors any agreements that forecast benefits in case of resignation or revocation without good cause or in case the relationship is interrupted after a takeover bid.

50 • Consolidated Management Report FINANCIAL YEAR 2010

O ther aspects

Joint press release Bank of Italy/Consob/Isvap of 3 March 2010

With regard to the information requested by the joint press release, the Parent Bank and subsidiaries’ managing directors have agreed and analysed, pending approval of the financial statements, information relating to: - Ias 36 Value decrease in assets (Impairment test) - Ias 39 Value decrease in financial instruments entered as A“ vailable for sale” - Ifrs 7 Contractual clauses of loans payable - Ias 39 Restructuring of payables - Ifrs 7 Information on “Fair value hierarchy”

As for the first and the second point, impairment test internal procedures have been analysed, the related tests carried out and the information reported in the Notes to the consolidated financial statementsP art b - Section 13 “Intangible Assets" item. With reference to contractual clauses of financial debts, all positions are implemented under market conditions, with usual clauses. As for the fourth point, Banca Intermobiliare Group did not restructure any debts and therefore the information is not applicable. Finally, with reference to the information on fair value rank, the financial statements information relating to the method for pricing calculation has been analysed (already subject to resolution in the previous years by the Board of Directors), in particular the fair value division in three levels requested by the regulations. For further information, see the Notes to the consolidated financial statementsP art A - Section A.3 "Information of fair value" and in part E - "Information on risks and on related hedging policies”.

PRIVACY

Banca Intermobiliare S.p.A., owner of the data processing, states under point 26 of technical disciplinary concerning minimum security measures (Attachment B - Legislative Decree 30/06/03, no. 196 “Code concerning personal data’s protection”), that on 01 March 2010 the Security Programming document was updated and that on 10 February 2011, the update of the 2011 Security Programming Document under point 19 of the above mentioned technical CONSOLIDATED MANAGEMENT REPORT Disciplinary concerning minimum security measure was completed by the Data processing manager.

Turin 14 March 2011 For the Board of Directors Chairman

Prof. Roberto Ruozi

Consolidated Management Report • 51

FINANCIAL YEAR 2010

FINANCIAL YEAR 2010 CONSOLIDATED MANAGEMENT REPORT

CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Management Report • 53 FINANCIAL YEAR 2010

CONSOLIDATED BALANCE SHEET (stated in EUR ‘000)

Assets 31.12.2010 31.12.2009 10. Cash and cash equivalents 3,511 4,788 20. Financial assets held for trading 414,296 532,325 40. Financial assets available-for-sale 399,408 373,110 50. Financial assets held to maturity 5,627 5,551 60. Loans to banks 260,024 441,875 70. Loans to clients 1,855,250 1,733,176 100. Investments 5,950 5,996 120. Tangible assets 162,226 159,912 130. Intangible assets 88,458 91,146

of which: goodwill 65,294 65,294 140. Tax assets a) current 13,741 5,403 b) deferred 38,551 39,039 160. Other Assets 43,591 45,300 Total assets 3,290,633 3,437,621 CONSOLIDATED FINANCIAL STATEMENTS

54 • Consolidated Financial Statements FINANCIAL YEAR 2010

CONSOLIDATED BALANCE SHEET (stated in EUR ‘000)

Liabilities and equity items 31.12.2010 31.12.2009 10. Due to banks 453,994 493,334 20. Due to clients 1,750,607 1,979,046 30. Outstanding securities 415,447 365,581 40. Trading financial liabilities 149,529 85,923 60. Hedging derivatives 148 94 80. Tax liabilities a) current 6,802 9,119 b) deferred 23,224 25,934 100. Other Liabilities 61,929 53,925 110. Staff severance provision 4,644 4,569 120. Provisions for liabilities and charges a) pensions and similar obligations - - b) other provisions 14,181 17,592 140. Valuation reserves 15,308 17,150 160. Capital instruments 30,023 30,023 170. Reserves 223,563 213,603 180. Share premium - 140 190. Share capital 156,209 156,038 200. Treasury shares (-) (34,416) (33,802) 210. Equity attributable to minority interest (+/-) 9,188 10,780 220. Profit (Loss) for the year 10,253 8,572 Total liabilities and equity 3,290,633 3,437,621 CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements • 55 FINANCIAL YEAR 2010

CONSOLIDATED INCOME STATEMENT (stated in EUR ‘000) 31.12.2010 31.12.2009 Income statement items 10. Interest income and similar items 60,777 75,996 20. Interest expense and similar items (32,161) (47,880) 30. Net interest income 28,616 28,116 40. Fees and commissions income 113,829 108,026 50. Fees and commissions expenses (40,071) (33,325) 60. Net fees and commissions 73,758 74,701 70. Dividends and similar income 2,929 1,280 80. Net result from trading activity 16,104 17,918 90. Net result from hedging activity - 553 100. Profit (loss) from disposal or repurchase of: a) loans 94 - b) available-for-sale financial assets 7,374 30,337 c) financial activities held to maturity - - d) financial liabilities (370) (340) 120. Net operating income 128,505 152,565 130. Net value adjustments /write-backs for impairment of: a) loans (4,394) (18,221) b) available-for-sale financial assets (1,935) (10,848) c) financial activities held to maturity - - d) other financial transactions (49) - 140. Financial profit (loss) 122,127 123,496 180. Administrative overheads a) personnel costs (59,716) (59,302) b) other administrative overheads (37,742) (35,149) 190. Net provisions for liabilities and charges (3,237) (11,909) 200. Net value adjustments /write-backs on tangible assets (3,986) (4,275) 210. Net value adjustments /write-backs on intangible assets (4,252) (4,308) CONSOLIDATED FINANCIAL STATEMENTS 220. Other operating income/charges 3,127 3,735 230. Operating costs (105,806) (111,208) 240. Profit (Loss) of investments 27 345 270. Profit (Loss) from investments disposal 996 (3) 280. Profit (Loss) of current operations before tax 17,344 12,630 290. Current operations income tax (8,315) (6,616) 300. Profit (Loss) of current operations after tax 9,029 6,014 310. Profit (Loss) of discontinued operations after tax - 1,154 320. Profit (Loss) for the year 9,029 7,168 330. Profit (Loss) for the year attributable to third parties 1,224 1,404 340. Profit (Loss) for the year attributable to the parent bank 10,253 8,572

56 • Consolidated Financial Statements FINANCIAL YEAR 2010

TOTAL CONSOLIDATED COMPREHENSIVE INCOME AT 31.12.10 (stated in EUR ‘000)

Items 2010 2009 10. Profit (Loss) for the year 9,029 7,168 Other income components after tax - 20. Available-for-sale financial assets (7,119) 12,065 30. Tangible assets (135) - 60. Cash flow hedges: (92) - 70. Exchange rate differences 5,351 40 100. Share of valuation reserves of investments valued with equity method (271) 226 110. Total other income components after tax (2,266) 12,331 120. Total profitability (Item 10+110) 6,763 19,499 130. Total consolidated profitability attributable to third parties (1,649) (1,576) 140. Total consolidated profitability attributable to the parent bank 8,411 21,075 CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements • 57 FINANCIAL YEAR 2010

STATEMENT OF CHANGES IN THE CONSOLIDATED BALANCE SHEET FROM 31.12.2009 TO 31.12.2010 (stated in EUR ‘000)

Changes during the financial year Allocation previous Operations on equity financial year profit

d party equity at 31.12.10 pening balance at 01.01.10 pening balance at 31.12.09 Total consolidated comprehensive consolidated comprehensive Total income during the year

O O equity at 31.12.10 Group Thir Change in opening balance Reserves Dividends and other allocations Changes in reserves Issue of new shares shares of treasury Purchase Extra dividend Change in capital instruments shares Derivatives of treasury Stock options

Share capital:

a) ordinary shares 161,819 X 161,819 - X X 172 - X X X X X 156,209 5,782

b) other shares -X - -XX- -XXXXX- -

Share premium 140 X 140 - X (140) - X X X X X X - -

Reserves:

a) of profit 197,371 - 197,371 7,168 X 727 - (156) - X X X X 205,687 (577)

b) other 22,798 - 22,798 - X 329 - - - X - 543 X 17,876 5,794

Valuation reserves 16,987 - 16,987 X X X X X X X X X (2,266) 15,308 (587)

Capital instruments 30,023 X 30,023 X X X X X X - X X X 30,023 -

Treasury shares (33,802) X (33,802) X X X - (614) X X X X X (34,416) -

Profit (Loss) for the year 7,168 - 7,168 (7,168) - X X X X X X X 9,029 10,253 (1,224)

Total equity 402,504 - 402,504 - - 916 172 (770) - - - 543 6,763 400,940 9,188 CONSOLIDATED FINANCIAL STATEMENTS

Group equity 391,724 - 391,724 X - 860 172 (770) - - - 543 8,411 400,940 X

Third party equity 10,780 - 10,780 - - 56 ------(1,648) X 9,188

58 • Consolidated Financial Statements FINANCIAL YEAR 2010

STATEMENT OF CHANGES IN THE CONSOLIDATED BALANCE SHEET FROM 31.12.2008 TO 31.12.2009 (stated in EUR ‘000)

Changes during the financial year Allocation previous Operations on equity financial year profit

d party equity at 31.12.09 pening balance at 01.01.09 pening balance at 31.12.08 Total consolidated comprehensive consolidated comprehensive Total income during the year

O pening balance at 31.12.09 Change in opening balance O pening balance at 01.01.10 equity at 31.12.10 Group party equity at 31.12.10 Third O O equity at 31.12.09 Group Thir Change in opening balance Reserves Dividends and other allocations Changes in reserves Issue of new shares shares of treasury Purchase Extra dividend Change in capital instruments shares Derivatives of treasury Stock options Reserves Dividends and other allocations Changes in reserves Issue of new shares shares of treasury Purchase Extra dividend Change in capital instruments shares Derivatives of treasury Stock options consolidated comprehensive Total income during the year

Share capital: Share capital: a) ordinary shares 161,819 X 161,819 - X X 172 - X X X X X 156,209 5,782 a) ordinary shares 155.773 X 155.773 - X X 265 - X X X X X 156.038 - b) other shares -X - -XX- -XXXXX- - b) other shares - X - -XX - -XXXXX - -

Share premium 140 X 140 - X (140) - X X X X X X - - Share premium 140 X 140 -XX - X X X X X X 140 -

Reserves: Reserves: a) of profit 197,371 - 197,371 7,168 X 727 - (156) - X X X X 205,687 (577) a) of profit 141.384 116.237 257.621 (61.764) X 1.372 - (685) - X X X X 80.307 827 b) other 22,798 - 22,798 - X 329 - - - X - 543 X 17,876 5,794 b) other 133.196 (116.237) 16.959 - X (526) - X - X X 625 X 133.296 5.739

Valuation reserves 16,987 - 16,987 X X X X X X X X X (2,266) 15,308 (587) Valuation reserves 4.123 - 4.123 X X 525 X X X X X X 12.331 17.150 (163)

Capital instruments 30,023 X 30,023 X X X X X X - X X X 30,023 - Capital instruments 30.023 X 30.023 X X X X X X - X X X 30.023 -

Treasury shares (33,802) X (33,802) X X X - (614) X X X X X (34,416) - Treasury shares (30.227) X (30.227) XXX - (3.575) X X X X X (33.802) -

Profit (Loss) for the year 7,168 - 7,168 (7,168) - X X X X X X X 9,029 10,253 (1,224) Profit (Loss) for the year (61.764) - (61.764) 61.764 - X X X X X X X 7.168 8.572 (1.404)

Total equity 402,504 - 402,504 - - 916 172 (770) - - - 543 6,763 400,940 9,188 Total equity 372.648 - 372.648 - - 1.372 265 (4.260) - - - 625 19.499 391.724 10.780 CONSOLIDATED FINANCIAL STATEMENTS Group equity 391,724 - 391,724 X - 860 172 (770) - - - 543 8,411 400,940 X Group equity 372.648 X 372.648 X - 1.372 265 (4.260) - - - 625 21.075 391.724 x

Third party equity 10,780 - 10,780 - - 56 ------(1,648) X 9,188 Third party equity 12.356 - 12.356 ------(1.576) x 10.780

Consolidated Financial Statements • 59 FINANCIAL YEAR 2010

CONSOLIDATED CASH FLOW STATEMENT (stated in EUR ‘000)

A. OPERATING ACTIVITIES 31.12.2010 31.12.2009 1. Management 21,507 48,347 - interest received (+) 49,722 79,684 - interest paid (-) (27,119) (64,979) - dividends and similar income (+) 2,929 1,280 - net fees and commissions (+/-) 73,758 74,701 - personnel costs (with the exception of provision for severance pay and shares) (-) (56,588) (56,790) - other costs (-) (42,355) (29,419) - other revenue (+) 21,206 42,716 - costs/revenue related to groups of activity held for disposal net of tax effect (+/-) - 1,154 2 Cash flow generated/absorbed by financial assets 146,471 234,097 - financial activities held for trading 126,932 290,884 - available-for-sale financial assets (33,666) (135,594) - loans to clients (124,615) (1,368) - loans to banks: on demand 75,112 (91,551) - loans to banks: other loans 108,918 155,275 - other assets (6,210) 16,451 3 Cash flow generated/absorbed by financial liabilities: (161,663) (279,192) - due to banks: on demand 140,174 (90,658) - due to banks: other payables (180,298) 138,655 - due to clients (228,728) (13,887) - outstanding securities 45,897 (1,726) - trading financial liabilities 63,606 (274,890) - other liabilities (2,314) (36,686) Net cash flow generated/used by operations 6,315 3,252 CONSOLIDATED FINANCIAL STATEMENTS

60 • Consolidated Financial Statements FINANCIAL YEAR 2010

B. INVESTING ACTIVITIES 31.12.2010 31.12.2009 1. Cash generated by: 1,042 37,448 - disposal of investments 1,042 37,448 2. Cash used by: 7,864 36,751 - purchase of tangible assets 6,300 2,236 - purchase of intangible assets 1,564 816 - acquisition of subsidiaries and business divisions - 33,699 Net cash generated/used by investment activities (6,868) 697

C. FUNDING ACTIVITIES 31.12.2010 31.12.2009 - issue/purchase of treasury shares (614) (3,575) - issue/purchase of capital instruments (156) (685) - distribution of dividends and other uses - 1,372 Net cash generated/used by funding activities (770) (2,888) NET CASH GENERATED/USED DURING THE FINANCIAL YEAR (1,277) 1,061

RECONCILIATION

Items Amount 31.12.2010 31.12.2009 Opening cash and cash equivalents 4,788 3,727 Net cash generated/used during the financial year (1,277) 1,061 Closing cash and cash equivalents 3,511 4,788 CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements • 61

FINANCIAL YEAR 2010

CONSOLIDATED FINANCIAL STATEMENTS AS AT 31 DECEMBER 2010

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FINANCIAL YEAR 2010 Part A - ACCOUNTING POLICIES A.1 - GENERAL

Section 1 - Declaration of compliance with International accounting standards

The consolidated financial statements of the Banca Intermobiliare Group were prepared by applying International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS), as approved by the European Commission on the basis of the procedures indicated in EC Regulation No. 1606 of 19 July 2002 and as dictated by Italian Legislative Decree 38/05. In addition, the consolidated financial statements were prepared in accordance with the first update of 18 November 2009 of Circular No. 262 of 22 December 2005 issued by Bank of Italy which specifies the reporting formats and related methods for completing them, as well as the content of the notes to the financial statements. In addition, reference was made to documents prepared by the Organismo Italiano di Contabilità (Italian Accounting Profession, O.I.C.) and by the Associazione Bancaria Italiana (ABI) in order to provide better guidance for the interpretation and application of the new accounting standards. The document was also prepared in accordance with Consob regulations. Section 2 - General principles of preparation The financial statements are made up of balance sheet, the income statement, the statement of comprehensive income, the statement of changes in equity, the cash flow statement and the notes to the financial statements and are accompanied by the Director’s report and the declaration by the Chief Executive Officer and the Executive in charge of the preparation of corporate accounting documents made pursuant to Article 154-bis, paragraph 5 of Italian Legislative Decree 58/1998. The financial statements are prepared on the basis of company continuity, using euros as the currency of account in accordance with the provisions of Article 5 of Italian Legislative Decree No. 38 of 28 February 2005. Unless otherwise indicated, amounts are expressed in thousands of euros. No exceptions were made to the application of IAS and IFRS principles. In addition to the amounts related to the reporting period, the financial statements and the notes to the financial statements include corresponding figures as at 31 December 2009 for comparison purposes. The report on operations and the notes to the financial statements provide the information required by International Accounting standards, laws, Bank of Italy and Consob.

Section 3 - Consolidation area and methods The consolidated financial statements incorporate the Parent Company Banca Intermobiliare and its direct and indirect subsidiaries and associates. Subsidiaries are considered to be those companies in which the Parent Company holds more than half of the voting rights (including “potential” voting rights), whether directly or indirectly, or in which it has the power to appoint the majority of the directors or to determine the financial and operating policies of the subsidiary, even if it has less than half of the voting rights. Associates, or companies subject to significant influence, are considered to be those companies in which the Parent Company holds at least 20% of voting rights (including “potential” voting rights), whether directly or indirectly, or in which, pursuant to shareholder agreements, it has the power to participate in determining the financial and management policies. There have been no changes in the consolidation area of the Banca Intermobiliare Group since the publication of the consolidated financial statements at 31 December 2009.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A It should be noted that on 1 January 2010, the 100% stake in Bim Alternative Investments SGR S.p.A. was merged into Symphonia SGR S.p.A.; in addition, at the end of 2010, the Parent Company Banca Intermobiliare reclassified its equity investment in Immobiliare D S.r.l. from “Non-current assets and disposal groups held for sale” to “Equity investments” since the prerequisites of IFRS 5 had not been met. This equity investment, which was purchased as part of a transaction, aimed to recover a certain exposure position and was treated for accounting purposes in accordance with IFRS 5 from 31 December 2009. For additional information, see Part B “Information on the consolidated balance sheet” under Section 15, “Non-current assets and disposal groups held for sale and related liabilities.”

64 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010

The table below indicates equity investments included in the consolidation area. 1. Investments in companies controlled exclusively and jointly (proportional consolidation)

% votes Form of Head Investment share available Company name control Investor % equity (b) office (a) company investment A . Companies A. CONTROLLING INTERESTS A.1 Fully consolidated companies 1. Symphonia SGR S.p.A. Milan 1 Banca Intermobiliare 100% 100% 2. Banca Ipibi Financial Advisory S.p.A Milan 1 Banca Intermobiliare 67% 67% 3. Bim Intermobiliare di Investimenti e Gestioni (Suisse) S.A. Lugano 1 Banca Intermobiliare 100% 100% 4. Patio Lugano SA Lugano 1 Bim Suisse 100% 100% 5. Bim Immobiliare S.r.l. Turin 1 Banca Intermobiliare 100% 100% 6. Bim Fiduciaria S.p.A. Turin 1 Banca Intermobiliare 100% 100% 7. Bim Insurance Brokers S.p.A. Turin 1 Banca Intermobiliare 51% 51% 8. Immobiliare D S.r.l. Milan 1 Banca Intermobiliare 100% 100%

(a): Form of control: 1. majority of voting rights at the shareholders’ meeting (b): Votes available at shareholders meeting: all are available Consolidation methods The financial statements used for consolidation are those specially prepared by individual companies that have been adjusted and reclassified in order to bring them in line with the accounting standards and presentation formats required for the consolidated financial statements of Banca Intermobiliare. The financial statements to be consolidated relate to the same date as the Parent Company. In addition to the Parent Company, all subsidiaries are fully consolidated based on the respective financial statements at 31 December 2010. Financial statement figures for the Swiss subsidiary, which prepares its accounting statements in local currency, are converted to euros using the following methods: for balance sheet figures, the exchange rate at the financial year end was used, while operating figures were converted using the average exchange rate for the period from 1 January 2010 to 31 December 2010. The difference between profit reflected on the balance sheet and on the income statement, due to the use of two different exchange rates, as well as the difference between the valuation of share capital at the historical rate as compared to the end of period exchange rate, were reclassified under equity reserves. The equity investment in the insurance company Bim Vita S.p.A., which is held on a 50/50 basis with Fondiaria-Sai S.p.A., was accounted using the equity method as required by IAS/IFRS principles. Full consolidation The full consolidation method consists of transferring the balance sheet and income statement items of subsidiaries “line-by-line”. Investments in subsidiaries included in consolidation have been offset against the corresponding portion of equity of those companies.

Consolidation difference NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A If positive, the differences resulting from this procedure are recorded - following any allocation to asset or liability components of the subsidiary - as goodwill under the item “Intangible assets” on the date of the first consolidation, and subsequently under “Other reserves.” Positive consolidation differences are subject to periodic impairment tests in order to determine whether the related book value is appropriate. If the recoverable value of goodwill is lower than book value, the difference is recognised in the income statement.

Notes to the Consolidated Financial Statements - Part A• 65 FINANCIAL YEAR 2010

Elimination of overlapping items The following were eliminated from the consolidated financial statements: • overlapping assets and liabilities • income and charges related to booked transactions and profits and losses resulting from trading operations. Dividends Any dividends of subsidiaries included in the full consolidation method or accounted for using the equity method and posted to the income statement of the investor company are eliminated with an offsetting credit under “retained earnings (accumulated losses)” in the consolidated financial statements. Deferred taxes on consolidation differences If certain conditions are met, adjustments made during consolidation result in the recognition of deferred tax assets and liabilities. Valuation using the equity method This method consists of allocating to subsidiaries the value of their shareholders’ equity equal to the share applicable to the Group, including the net profit for the period. In particular, this method involves the initial registration of the equity investment at cost and its subsequent adjustment on the basis of the company’s share of the subsidiary’s shareholders’ equity. The differences between the value of the equity investment and the subsidiary’s shareholders’ equity are included in the book value of the subsidiary. If the value of an equity investment has been reduced, the recoverable value of the investment is assessed, taking into account the present value of future cash flows that may generate from the investment, including its final disposal value. The pro-rata share of the subsidiary’s net profit for the period is recorded in a specific item in the consolidated income statement. 2. AdDItional information Not applicable Section 4 - Events after the financial statement reporting date

Change in parent company Through an agreement for the merger of Cofito (the controlling shareholder of Banca Intermobiliare) booked on 18 February 2011 and recorded on the Company Registers of Treviso and Turin on 25 February 2011, Veneto Banca S.c.p.a. acquired legal control of the Issuer Banca Intermobiliare. Pursuant to Articles 102 and 106, paragraph 1 of the Consolidated Law on Finance, following this acquisition, the legal prerequisites were met for Veneto Banca S.c.p.a. to launch a mandatory takeover bid for the remaining outstanding BIM shares. The Bidder will pay to each Offer participant a cash amount equal to EUR 4.25 for each share surrendered to participate in the Offer. Veneto Banca intends to maintain the BIM shares listed on the electronic stock exchange and thus it will reinstate outstanding shares if, as a result of the above offer, it should exceed an equity interest of 90% in BIM share capital.

Going concern With reference to the assumption of the company being a going concern, in the report on operating performance and NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A changes in the balance sheet and financial situation, directors did not indicate any situations that would cast a doubt on the ability of the company and its subsidiaries to continue normal operations. The balance sheet and the financial structure are suitable for ensuring operating continuity in the near future. Based on this reasonable expectation, the financial statements at 31 December 2010 were prepared with the expectation that the company is a going concern.

66 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010

Section 5 - Other aspects Reclassification of equity investment in Immobiliare D S.r.l. Following the inability to meet the requirements dictated by IFRS 5, the comparative value in the financial statements at 31 December 2009 in the equity components of the subsidiary Immobiliare D S.r.l. was reclassified from the item “Non-current assets/liabilities and asset groups held for sale” to individual items on the financial statement. The reclassification of these financial statement items had no impact on the income statement or on shareholders’ equity. Reclassification of Banca Ipibi tax credits Following the EUR 567,000 reclassification carried out in its financial statements by the subsidiary Banca Ipibi of certain tax credits that were no longer related to income taxes, the comparative value at 31 December 2009 was reclassified from “Tax assets” to “Other assets.” In the preparation of these financial statements, the Banca Intermobiliare Group restated the balance sheet values at 31 December 2009 for the following financial statement items: (Thousands of €) 31.12.2009 Reclassification Reclassification 31.12.2009 Amount Immobiliare D Banca Ipibi reclassified Assets 60. Loans to banks 441,853 22 - 441,875 120. Tangible fixed assets 125,862 34,050 - 159,912 130. Intangible fixed assets 91,083 63 - 91,146 150. Non-current assets and disposal groups held for sale 34,301 (34,301) - - 140. Tax assets 44,851 158 (567) 44,442 160. Other assets 44,725 8 567 45,300 Liabilities 10. Due to banks 493,093 241 - 493,334 90. Liabilities associated with disposal groups held for sale 602 (602) - - 100. Other liabilities 53,564 361 - 53,925

Other reclassifications in the income statement Regarding the financial statements published at 31 December 2009, EUR 17,099,000 out of the balance of interest income were reclassified in order to report at closed balances the net difference between interest income and expense for derivative contracts. In addition, as a result of certain regulatory clarifications by Bank of Italy, EUR 1,040,000 out of certain charges for employee benefits (insurance policies and meal vouchers) were reclassified from “Other administrative expenses” to “Personnel costs.” (Thousand of e) 2009 Reclassification 2009 Amount reclassified NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A Income statement 10. Interest income and similar items 93,095 (17,099) 75,996 20. Interest expense and similar charges (64,979) 17,099 (47,880) 180. Administrative expenses: a) personnel costs (58,262) (1,040) (59,302) b) other administrative expenses (36,189) 1,040 (35,149)

Notes to the Consolidated Financial Statements - Part A• 67 FINANCIAL YEAR 2010

A2 - INFORMATION ON THE MAIN ITEMS

Below is a description of the accounting principles used to prepare the IAS/IFRS consolidated financial statements at 31 December 2010; these standards did not change from the previous year. The presentation of the accounting principles applied is based on the classification, recording, valuation and removal of the various asset and liability items. Where relevant, a description of the related operating impact is provided for each of the above stages.

Section 1 - Financial assets held for trading

Classification criteria Debt and equity securities, fund units and the positive value of derivative contracts held for trading are included in this category.

Recognition criteria When first identified, these financial assets, net of any transaction costs, are recorded in the balance sheet at fair value, usually corresponding to the amount paid to acquire them. They are recorded on the financial statements starting from the settlement date.

Criteria for valuation and recording of operating components Subsequently, financial assets held for trading are valued at fair value with an offset for changes posted to the income statement. To determine the fair value of financial instruments listed on an active market, market prices are used. In the absence of an active market, there are internal valuation models that take into account all risk factors related to the financial instruments. In particular, valuations are based on whether or not there are contributing factors from trading platforms, on volumes traded, on spreads applied or on other factors. Alternatively, there are valuation methods that are provided by key information sources and internal valuation methods based on the valuation of listed instruments with similar characteristics, of discounted cash flows or of values taken from recent transactions. Financial instruments for which it is not possible to determine fair value in a reliable manner were maintained at cost. Derivative financial instruments are reported in financial statements under assets if fair value is positive or under liabilities, if fair value is negative.

Derecognition criteria Financial assets are derecognised from the balance sheet only if their transfer resulted in the substantial transfer of all of their associated risks and benefits.

Section 2 - Financial assets available for sale

Classification criteria These are financial assets that cannot be classified as loans, receivables or financial assets held for trading or held NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A until maturity. In particular, the Banca Intermobiliare Group also includes in this item equities not qualified as controlled, linked or jointly controlled equity investments.

Recognition criteria When first identified, these financial assets are recorded at fair value, usually corresponding to the amount paid to acquire them, in addition to any transaction costs that are directly attributable to such assets.

68 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010

Criteria for valuation and recording of operating components Subsequently, the financial instruments classified in this category must be valued at fair value, with a balancing entry in equity reserve, until the financial asset is disposed of or impairment is recognised. At the time of disposal or any impairment, the equity reserve is reversed back to the income statement. If the reasons for impairment no longer apply, it is necessary to record a write-back, the impact of which is recorded in the income statement in the case of debt securities, or directly in the equity reserve in the case of equity securities. The fair value of financial assets available for sale is determined on the basis of market prices for comparable transactions, and on valuation models based on multiples or discounted cash flow. Equity securities for which it is not possible to determine fair value in a reliable manner are maintained at cost.

Derecognition criteria Financial assets are derecognised from the balance sheet only if their transfer resulted in the substantial transfer of all of their associated risks and benefits.

Section 3 - Financial assets held to maturity

Classification criteria This category includes all investments held other than equity investments, with fixed payments, or payments that can be determined on a fixed maturity date, that are listed on an active market (level 1), and that the company intends and is in a position to hold them until maturity.

Recognition criteria Financial assets are recorded on their settlement date. On the date when first recorded, financial assets held to maturity are reported in the balance sheet at their fair value, which usually corresponds to the amount paid to acquire them.

Valuation criteria Subsequently, assets held to maturity are measured at amortised cost using the effective interest criterion.

Derecognition criteria Financial assets are derecognised from the balance sheet only at maturity, or on rare exceptions prior to their natural maturity, but in accordance with the provisions of IAS 39 in terms of exemption from the “tainting rule.”

Section 4 - Loans

Classification criteria This category includes direct loans to customers or banks that entail fixed or determined payments. These financial assets are not listed in an active market and from the outset are not classified under financial assets available for sale or under assets designated at fair value. This item includes repo transactions, securities lending and current accounts at credit institutions. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A

Recognition criteria Receivables and loans are initially recorded at fair value, which usually corresponds to the amount disbursed including any directly attributable costs and income, net of disbursements.

Notes to the Consolidated Financial Statements - Part A• 69 FINANCIAL YEAR 2010

Valuation criteria After initial recognition, loans are assessed at their amortised cost using the effective interest rate method. For loans made by the Banca Intermobiliare Group, the absence of costs that are directly allocable to financial statement entries makes the impact of recording such entries using the amortised cost method negligible. The book value of receivables and loans is periodically subjected to impairment tests. Specific valuations are completed for all non-performing assets, as detailed in current Bank of Italy rules that are consistent with IAS regulations, and for all significant individual positions. The adjustment for exposure is equal to the difference between the book value at which the asset was recorded, and the present value of future cash flows discounted by applying the actual interest rate of the exposure. The projected cash flows take into account expected recovery periods, the estimated execution value of collateral and the legal costs to recover the loan. Performing loans and non-performing loans, for which a specific valuation has been carried out that did not identify any impairment, are measured collectively. The calculation model used by the Banca Intermobiliare Group is an approximation of the approach introduced with the provisions of Basel II concerning the monitoring of the lending sector since there are significant similarities in the measurement of risks inherent in loans under IAS/IFRS and the Basel rules. More specifically, similar loan categories were grouped by product classes, with the parameters PD (probability of default) and LGD (loss given default) associated with each of these. In order to determine collective write-downs for loans, the Group utilised sector-based parameters. Specifically, Bank of Italy’s “decay rates” were used, with appropriate adjustments, where necessary, to take into account specific situations, as PD, while Basel percentages were used for LGD. Write-downs are recorded in the income statement, as are their related write-backs.

Derecognition criteria Loans are derecognised from the balance sheet if the transfer resulted in the substantial transfer of all loan-related risks and benefits, when contractual rights to receive the related cash flows have expired and in the event of impairment.

Section 5 - Financial assets designated at fair value

The Banca Intermobiliare Group has not required the adoption of the so-called “fair value option,” i.e., it has not taken advantage of the ability to designate at fair value any financial asset other than those for which IAS 39 requires the application of the fair value criterion based on the specific functional use, with the recording of the result of the valuation in the income statement.

Section 6 - Hedging transactions

Risk hedging transactions are carried out to neutralise potential losses on a given element or group of elements attributable to a given risk in the event that the specific risk should actually arise. The types of hedges are as follows:

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A - fair value hedges, in which case the changes in the fair value of the hedged element are offset by changes in the fair value of the hedging instrument. This offsetting is recognised by recording changes in value to the income statement with reference to both the hedged element and the hedging instrument. - cash flow hedges, which are used to hedge exposure to changes in future cash flows attributable to specific risks associated with items of the financial statements. Only financial instruments involving a counterparty outside the Banca Intermobiliare Group may be designated as hedging instruments.

70 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010

Section 7 - Equity investments

Recognition, classification and valuation criteria Associates, i.e., companies subject to significant influence, are considered to be those companies in which the Parent Company holds at least 20% of voting rights either directly or indirectly. If there is evidence that the value of an equity investment may have been reduced, the recoverable value of the investment is assessed, taking into account the present value of future cash flows that may generate from the investment, including its final exit value. If the recoverable value is lower than the book amount, the difference between the two is recognised in the income statement. If the reasons for a loss of value should no longer exist as a result of an event occurring after recognition of the reduction in value, a write-back is performed and entered in the income statement.

Derecognition criteria Equity investments are derecognised from the balance sheet when contractual rights to cash flows deriving from the assets expire or when essentially all related risks and benefits are transferred along with a transferred equity investment.

Section 8 - Tangible fixed assets

Classification criteria Tangible fixed assets include land, property, technical equipment, furniture, furnishings and equipment of any kind which is used in the Group’s business, or to provide services or to be leased to third parties, and which is expected to be used for more than one financial period. This item also includes assets used under finance leases even though legal ownership of such assets remains with the lessor.

Recognition criteria Tangible assets are initially recognised at cost, which, in addition to the purchase price, includes any other ancillary charge attributable to the purchase and implementation of the asset. Extraordinary maintenance costs leading to an increase in future economic benefits are recorded as an increase in the asset value, whereas other ordinary maintenance costs are recorded in the income statement.

Criteria for valuation and recording of operating components Tangible assets and related improvement costs are assessed at cost less any depreciation or impairment. Depreciation is calculated on the basis of the useful life of the fixed assets on a straight-line basis. It should also be noted that, under the new regulations, leasehold improvements fall under the scope of IAS 16 with reference to tangible assets when such costs are incremental in nature and have “materiality” characteristics, generate future benefits and can be separated from the asset over which the company exercises control.

The useful life of depreciable tangible assets is periodically tested. If there are adjustments to initial estimates, the NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A related depreciation charges are also changed. On each financial statement reporting date, an assessment is performed to determine whether there are indications that the asset has been subject to a permanent loss in value. If it has, it is necessary to determine the asset’s recoverable value, i.e., the greater of the net sales price and usage value. If the assumptions that led to the recording of a permanent loss in value no longer apply, a write-back must be recorded in the income statement.

Notes to the Consolidated Financial Statements - Part A• 71 FINANCIAL YEAR 2010

Below are the depreciation rates that were used to prepare these financial statements bearing in mind that depreciation is calculated starting from the date the asset is put in operation.

Type of tangible asset Depreciation rate Buildings: - Property used for production purposes 2.2% - Leasehold improvements 12.5% Furniture: - Furniture 12% - Furnishings 12% Other: - Electronic office equipment 20% - Specific equipment 25% - Machinery and devices 15% - Armoured counters 20% - Vehicles 25%

Derecognition criteria Tangible assets are derecognised on the date of their disposal and when future economic benefits are no longer expected.

Section 9 - Intangible fixed assets

Classification criteria Intangible fixed assets consist of non-monetary assets that are identifiable, lack physical substance, are held to be used in the company’s operations and generate future economic benefits for the company. Examples of intangible assets are goodwill and software to be used over several years. Goodwill is the positive difference between purchase cost and the fair value of assets and liabilities acquired to reflect any potential surplus value of equity investments acquired.

Criteria for recognition and recording of income components Intangible assets are recognised at cost, adjusted in terms of accessory charges only if it is likely that future economic benefits attributable to the asset will be realised and if the cost of the asset can be reliably determined. Otherwise, the cost of intangible assets is recognised in the income statement in the period in which it occurred. The cost of intangible assets is amortised on a straight line basis throughout its related useful life. If the useful life cannot be defined, no amortisation is carried out, and instead a periodic verification is performed to determine if the book value of assets is adequate. At the end of each financial period, if there is evidence of impairment, the recoverable value of the asset is estimated. The amount of the impairment, which is recorded in the income statement, is equal to the difference between the book value of the asset and the recoverable value. Goodwill may be recorded when the positive difference between the cost paid and the fair value of the net asset acquired is due to the future income-generating capacity of such asset. Since this is an asset with an indefinite useful NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A life, it is not amortised. On an annual basis (or each time there is evidence of impairment) an impairment test is performed on the adequacy of the goodwill value. Any reduction in value is determined on the basis of the difference between the book value of goodwill and its recovery value, if lower. This recovery value is equal to the greater of the fair value, net of any sales costs, and the related usage value. The resulting adjustments are recorded in the income statement.

72 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010

Derecognition criteria An intangible asset is derecognised from the balance sheet at the time of its disposal or when no future economic benefit can be expected.

Section 10 - Non-current assets held for sale

This item includes non-current assets and groups of assets that may be sold in the near future in their current condition and whose sale is considered highly likely. In particular, such assets/liabilities are measured at the lower of their book value and fair value net of sales costs. As operating elements that have been shut down, these assets, and the related charges and income (net of taxes) are reported in the balance sheet and income statement in separate items.

Section 11 - Current and deferred taxes

The Banca Intermobiliare Group recognises the impact of current taxes by applying tax regulations and tax rates in effect at the time the financial statements are prepared. Deferred taxes are calculated on the basis of tax provisions and rates, which, based on the provisions and rates in effect on the date the financial statements are prepared, will be applicable in future periods in which the temporary differences will be relevant for tax purposes. Income taxes are recorded in the income statement and consist of the balance between current and deferred taxes. Deferred tax assets and liabilities related to transactions affecting the income statement are recognised as an offset in the income statement. However, deferred tax assets and liabilities related to transactions affecting shareholders’ equity are recognised as an offset in shareholders’ equity with reference to specific reserves. The provision for income tax is determined on the basis of a prudent forecast of the current, the prepaid and the deferred tax burden. In particular, prepaid and deferred taxes are calculated on the basis of temporary differences between the attributed value of an asset or liability according to statutory criteria and the corresponding values assumed for tax purposes. Deferred tax assets are generated by deductible temporary differences or by income components, which, for the applicable period, are not recognised for tax purposes, therefore resulting in higher taxable income, and at the same time generating lower taxes in future periods. Deferred tax assets are only recognised when it is likely that there will be taxable income in the period when such temporary differences will be deductible. Deferred tax liabilities are generated by taxable temporary differences or by income components which, for the applicable period, are not recognised for tax purposes, therefore resulting in lower taxable income, and at the same time generating higher taxes in future periods. Assets and liabilities recorded for deferred taxes are regularly assessed to take into account any changes in tax regulations and tax rates.

Section 12 - Provisions for risks and charges

Classification criteria NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A Provisions for risks and charges include allocations made to cover current liabilities resulting from past events for which probable future disbursements of cash were determined. In addition, it must be possible to determine these disbursements using a reliable estimate.

Recognition and valuation criteria The amount recognised is equal to the best estimate of the liability that the Banca Intermobiliare Group will incur,

Notes to the Consolidated Financial Statements - Part A• 73 FINANCIAL YEAR 2010

taking into account the future time when such liabilities will generate any significant actual cash disbursement. The amounts allocated by the Banca Intermobiliare Group are related to client claims and disputes for which a resolution is not anticipated during the year. The funds allocated are reviewed on each reporting date and adjusted to reflect the best current estimate. The allocation was discounted using current market rates and recognised in the income statement.

Derecognition criteria The funds allocated are derecognised when the previously estimated liability is eliminated.

Section 13 - Payables and outstanding securities

Classification criteria This item includes payables to banks, payables to customers, issued and outstanding securities and financial statement entries incorporating the various forms of interbank and customer deposits. Outstanding securities consisting of bonds issued by the Bank, are reported in the financial statements net of any portion repurchased. Payables to customers also include payables to leasing companies in connection with finance lease transactions.

Recognition and valuation criteria When first recorded in the financial statements, outstanding securities are measured at their fair value, plus any transaction costs, which represents the amount collected. Payables with a short-term maturity are maintained at nominal value. Long-term payables and issued bonds with transaction costs are measured at amortised cost using the effective interest rate method. Purchases and sales of securities issued by the Group constitute redemptions and new issues of its own securities. The value of new issues is equal to the new placement price with no impact from the transaction on the income statement. Derivative components embedded in bonds issued by the Group were separated. For convertible bonds, the derivative was separated and reported under “Equity instruments,” and subsequently measured at cost. For structured bonds with underlying assets other than own shares, embedded derivatives were classified under liabilities held for trading and subsequently designated at their fair value if the prerequisites of IAS 39 were met.

Derecognition criteria These liabilities are derecognised from the balance sheet only when they expire or are redeemed. The difference between the book value of the liability and the amount paid as a repurchase is recorded in the income statement. The replacement of own shares on the market after their repurchase is considered a new issue with recognition at the new placement price.

Section 14 - Financial liabilities held for trading

Classification criteria NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A This item includes the negative value of trading derivative contracts, the negative value of embedded derivative contracts separated from bonds issued by the Parent Company and liabilities resulting from technical exposures generated from trading activity.

Recognition and valuation criteria Financial liabilities held for trading are measured using the same criteria applied to financial assets held for trading

74 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010 and thus reference should be made to comments made above.

Derecognition criteria Financial liabilities are derecognised from the balance sheet only if their transfer resulted in the substantial transfer of all of their associated risks and benefits.

Section 15 - Financial liabilities designated at fair value

See the comments in Section 5 - Financial assets designated at fair value in this section.

Section 16 - Foreign currency transactions

Criteria for inclusion Transactions in foreign currency are recorded, at the time of their initial recognition, in the accounting currency, applying the foreign currency exchange rate valid on the transaction date.

Valuation criteria and recognition of income components Monetary elements in foreign currency are converted using the rate at the end of the period. Non-monetary elements, which are measured at historical cost in foreign currency, are converted using the exchange rate in effect on the date of the transaction. Non-monetary elements designated at fair value in a foreign currency are converted using the exchange rates on the date on which fair value was determined. Exchange differences deriving from monetary element settlements or from conversions to rates different from the original rates applied or from conversions of previous financial statements are recorded in the income statement in the period in which they arise. When profit or loss relating to a non-monetary element is recorded under shareholders’ equity, any exchange difference relating to that element is also recorded under shareholders’ equity. Otherwise, when a profit or loss is recorded in the income statement, any related exchange difference is also recorded in the income statement.

Section 17 - Insurance assets and liabilities

Not applicable

Section 18 - Other information

Treasury shares Any treasury share held is recorded as a reduction in shareholders’ equity. If they are sold on the market, the difference between the purchase and sale price is recorded under the components of shareholders’ equity. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A Share-based payments Payments based on equity instruments issued to employees and other parties that provide services to Group companies are settled with shares of Group companies. These transactions are measured in accordance with IFRS 2 and the interpretations of IFRIC 11 which require the identification of the cost at the time the goods or services are consumed, resulting in an increase in shareholders’ equity in an amount equal to the fair value of the compensation on the allocation

Notes to the Consolidated Financial Statements - Part A• 75 FINANCIAL YEAR 2010

date (in the event of equity-settled share-based transactions) or the recording of a liability at the current value on the reporting date (in the event of cash-settled share-based transactions).

Recognition of costs and revenues Revenues are recorded in the income statement in the periods in which the related costs are reported. Income from fees and commissions and from other services is recorded in the financial statements in the periods in which the services were rendered. Other income is recorded in the financial statements according to the accrual principle.

Employees’ severance fund Following the pension reform implemented under Law No. 296 of 27 December 2006, it is essential, for accounting purposes, to distinguish between the amount of the employees’ severance fund accrued up to 31 December 2006 and the amount accrued starting 1 January 2007 (the effective date of the reform). The employees’ severance fund accrued starting 1 January 2007 is treated as a defined contribution plan (the company’s obligation to employees is fulfilled with its payment of contributions to supplemental pension funds). Based on the above, the company: • records the obligation for amounts accrued to 31 December 2006, according to the rules for defined benefit plans, using actuarial procedures. Actuarial gains and losses continue to be recorded at the end of the period in the income statement (without using the corridor approach); • records the obligation for amounts accruing from 1 January 2007 and owed to supplemental pension funds on the basis of contributions due each period (in this case, it is not necessary to report actuarial assumptions or discount the obligation since it matures in less than 12 months); • records the obligation for amounts accruing from 1 January 2007 that remain in the company and are added to the amounts accrued to 31 December 2006.

Valuation reserves Valuation reserves are determined as a function of valuation rules indicated for the assets and liabilities concerned, e.g., assets available for sale and stock options. These reserves also include the impact from the first application of IAS. This item includes valuation reserves for financial assets available for sale and for tangible and intangible assets revalued at the time of the first application of IAS/IFRS.

Use of estimates and assumptions in the preparation of financial statements In the preparation of financial statements, the Banca Intermobiliare Group, through its management and/or outside contractors, used estimates and assumptions to calculate balance sheet and income statement entries that entailed the processing and interpretation of available information and thus assessments that may be more or less subjective in nature. The main analyses that require subjective assessments are the following: • The assessment of the recoverable value of loans, also by means of assessing collateral or other financial assets (e.g., the measurement of fair value of unlisted financial instruments) and thus the related losses due to

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A impairment; • The assessment of the sustainability of the value of goodwill and intangible assets; • Quantifying provisions for staff and provisions for risks and charges; • The recoverability of deferred tax assets; • The allocation of acquisition costs within the scope of IFRS 3.

76 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010

Impairment of financial instruments On each reporting date, the financial assets not classified as “Financial assets held for trading” are subject to impairment tests in order to determine if their book value is fully recoverable. With specific reference to financial assets available for sale, a decrease in fair value below the acquisition cost of the financial instrument is to be considered objective evidence of impairment if the reduction in value is significant or long-lasting. In this situation, any accumulated losses during the period or negative shareholders’ equity reserves must be recorded in the income statement. If in future periods the preconditions for write-backs can be met, the write-backs for equity securities and undertakings for collective investment (UCIs) are recorded under shareholders’ equity reserves, while those related to debt securities are recorded in the income statement. In order to recognise any evidence of impairment, the Banca Intermobiliare Group takes into consideration all qualitative information about the issuer that could lead to loss events, as highlighted by IAS 39, §59-60, and quantitative information concerning the decrease in fair value of the financial instrument compared to acquisition cost. With reference to the latter, the Banca Intermobiliare Group has established an internal policy aimed at identifying cases in which a decrease in fair value must be considered significant or long-lasting. On the one hand, the criteria used call for the direct allocation of adjustments to the income statement for losses greater than 60% of the total value, or losses that last for a period of over 48 months. On the other hand, they call for the use of control filters and other qualitative and fundamental analyses, as required for securities which show no signs of impairment, but still reflect a loss in value of over 30% of book value.

A3 - INFORMATION ON FAIR VALUE

A.3.1 Transfers between portfolios

A.3.1.1 Reclassified financial assets: book value, fair value and impact on comprehensive income

Exclusively with respect to its Parent Company, Banca Intermobiliare S.p.A., the Banca Intermobiliare Group has taken advantage of the option provided by the amendment to IAS 39 to reclassify, no later than 31 October 2008, part of its financial assets (excluding derivatives) from “Financial assets held for trading” (Hft) to “Financial assets held to maturity” (Htm) and “Financial assets available for sale” (Afs). Below is the information required by the first update to Bank of Italy Circular 262 and the information required by IAS 39 and IFRS 7. (Millions of €)

Type of Source Target Book value at Fair value Income components Income components reported financial portfolio portfolio 31.12.2010 at 31.12.10 with no transfer during the financial period instrument (before taxes) (before taxes)

Valuation Other Valuation Other

Debt securities Hft L&R 40,576 40,550 (119) 622 x 1,154 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A Hft Afs 49,741 49,623 205 1,407 205 1,766 Hft Htm 5,627 5,670 19 55 x 131 UCI units Hft Afs 47,252 47,252 345 244 345 244 Equity securities Hft Afs 564 564 (48) 864 (48) 864 Total 143,760 143,659 402 3,192 502 4,159

Notes to the Consolidated Financial Statements - Part A• 77 FINANCIAL YEAR 2010

A.3.1.2 Reclassified financial assets: impact on comprehensive income before transfer

In 2010 no reclassifications were performed in accordance with the amendment to IAS 39 and IFRS 7.

A.3.1.3 Transfer of financial assets held for trading

Not applicable, see paragraph A.3.1.2.

A.3.1.4 Effective interest rate and projected cash flows from reclassified assets

Not applicable, see paragraph A.3.1.2.

A.3.2 Fair value hierarchy

Fair value is defined as the price for which an asset can be exchanged or a liability settled between knowledgeable and willing parties in a transaction between unrelated parties. Following the revision to IFRS 7, § 27, in order to ensure more complete information on the degree of discretion in the valuation of financial instruments reported in the financial statements, a ranking of the methods used to determine fair value was developed. Three pricing methodologies were defined and ranked on a hierarchical scale: 1) Prices in active markets: official or operational prices (in the case of contributors) available in active markets take priority for the determination of fair value. 2) Pricing models with market parameters: in the absence of an active market, the instrument must be valued by loading pricing models with input data available directly and indirectly on the market (rates, credit spreads, etc.). 3) Pricing models with estimated parameters: the final level is based on the determination of fair value using estimates and assumptions for data not available from the market.

A.3.2.1 Accounting portfolios: breakdown by fair value levels (Thousands of €) - 31 December 2010

Financial assets/liabilities designated at fair value Level 1 Level 2 Level 3 Total 1. Financial assets held for trading 220,411 132,513 61,372 414,296 2. Financial assets designated at fair value - - - - 3. Financial assets available for sale 259,819 56,465 83,124 399,408 4. Hedging derivatives - - - - Total 480,230 188,978 144,496 813,704 1. Financial liabilities held for trading 32,100 113,634 3,795 149,529 2. Financial liabilities designated at fair value - - - - 3. Hedging derivatives 148 - - 148 Total 32,248 113,634 3,795 149,677 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A

78 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010

(Thousands of €) - 31 December 2009

Financial assets/liabilities designated at fair value Level 1 Level 2 Level 3 Total 1. Financial assets held for trading 347,168 100,118 85,039 532,325 2. Financial assets designated at fair value - - - - 3. Financial assets available for sale 250,011 46,806 76,293 373,110 4. Hedging derivatives - - - - Total 597,179 146,924 161,332 905,435 1. Financial liabilities held for trading 7,513 78,088 322 85,923 2. Financial liabilities designated at fair value - - - - 3. Hedging derivatives 94 - - 94 Total 7,607 78,088 322 86,017

A.3.2.2 Annual changes in financial assets designated at fair value (level 3)

(Thousands of €) FINANCIAL ASSETS Held Designated Available Hedging for trading at fair value for sale 1. Opening balance 85,039 - 76,293 - 2. Increases 53,877 - 30,061 - 2.1 Purchases 28,427 - 25,418 - 2.2 Profits allocated to: - - - - 2.2.1 Income statement 268 - - - - Of which: Capital gains 268 - - - 2.2.2 Shareholders' equity x x 1,407 x 2.3 Transfers from other levels 25,148 - - - 2.4 Other increases 34 - 3,236 - 3. Decreases (77,544) - (23,230) - 3.1 Sales (1,550) - (17,001) - 3.2 Repayments (72,472) - (3,010) - 3.3 Losses allocated to: - - - - 3.3.1 Income statement (83) - (884) - - Of which: Capital losses (83) - (884) - 3.3.2 Shareholders' equity x x (2,335) x 3.4 Transfers to other levels (3,238) - - - 3.5 Other decreases (201) - - - 4. Net closing balance 61,372 - 83,124 - NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A

Notes to the Consolidated Financial Statements - Part A• 79 FINANCIAL YEAR 2010

A.3.2.3 Annual changes in financial liabilities designated at fair value (level 3)

(Thousands of €) FINANCIAL LIABILITIES Held for trading Designated at fair value Hedging 1. Opening balance 322 - - 2. Increases 3,490 - - 2.1 Issues 1,590 - - 2.2 Losses allocated to: - - - 2.2.1 Income statement - - - - Of which: Capital losses 1,280 - - 2.2.2 Shareholders' equity x x - 2.3 Transfers from other levels 620 - - 2.4 Other increases - - - 3. Decreases (17) - - 3.1 Repayments (17) - - 3.2 Repurchases - - - 3.3 Profits allocated to: - - - 3.3.1 Income statement - - - - Of which: Capital gains - - - 3.3.2 Shareholders' equity x x - 3.4 Transfers to other levels - - - 3.5 Other decreases - - - 4. Net closing balance 3,795 - -

A.3.3 Information on “day one profit/loss”

At the time of the initial recognition of financial instruments traded in non-active markets, no differences were found between the transaction price and its fair value using the valuation techniques described in Part E of the notes to the consolidated financial statements. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - PART A

80 • Notes to the Consolidated Financial Statements - Part A FINANCIAL YEAR 2010 Part B - INFORMATION ON THE CONSOLIDATED BALANCE SHEET

ASSETS

Section 1 - Cash and cash equivalents - Item 10 B 1.1 Cash and cash equivalents: breakdown

2010 2009 art a) Cash 3,511 4,788 b) Demand deposits at central banks - - - P Total 3,511 4,788

Section 2 - Financial assets held for trading - Item 20

2.1 Financial assets held for trading: breakdown by type tatements S

Items/Amounts 2010 2009 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 A. Non-derivative assets 1. Debt securities inancial 1.1 Structured securities 3,446 4,500 8,319 4,696 6,945 6,679 F 1.2 Other debt securities 170,567 14,501 51,454 324,456 16,496 76,521 2. Equity securities 15,166 - 1,396 9,344 448 1,629 3. UCI units 5,466 - - 8,229 - - 4. Loans 4.1 Repurchase agreements ------4.2 Other ------Total A 194,645 19,001 61,169 346,725 23,889 84,829

B. Derivatives onsolidated

1. Financial derivatives: C 1.1 Held for trading 25,766 112,699 203 443 75,572 210 the

1.2 Connected with fair value option ------1.3 Other ------to 2. Credit derivatives 2.1 Held for trading - 813 - - 657 - 2.2 Connected with fair value option ------otes

2.3 Other ------N Total B 25,766 113,512 203 443 76,229 210 Total (A+B) 220,411 132,513 61,372 347,168 100,118 85,039

Notes to the Consolidated Financial Statements - Part B • 81 FINANCIAL YEAR 2010

2.2 Financial assets held for trading: breakdown By borrower/issuer

Items/Amounts Total 2010 Total 2009 A. NON-DERIVATIVE ASSETS 1. Debt securities a) Governments and central banks 12,783 37,267 b) Other government authorities 65 47 c) Banks 205,137 260,235 d) Other issuers 34,802 138,245 2. Equity securities a) Banks 720 17 b) Other issuers - Insurance Companies 2,276 1,360 - Financial companies 198 2 - Non-financial companies 13,306 9,484 - Other 62 557 3. UCI units 5,466 8,229 4. Loans a) Governments and central banks - - b) Other government authorities - - c) Banks - - d) Other entities - - Total A 274,815 455,443 B. DERIVATIVES a) Banks - Fair value 44,193 19,977 B) Clients - Fair value 95,288 56,905 Total B 139,481 76,882 Total (A+B) 414,296 532,325 NOTA INTEGRATIVA CONSOLIDATA - PARTE B

82 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

2.3 Non-derivative financial assets held for trading: annual changes

Debt securities Equity securities UCI units Loans Total B A. Opening balance 11,421 8,229 - 455,443 B. Increases art B1. Purchases 1,558,580 165,780 4,244 - 1,728,604 B2. Increases in fair value 1,226 791 11 - 2,028 - P B3. Other changes 7,896 25,382 502 - 33,780 C. Decreases C1. Sales (1,471,023) (169,417) (7,464) - (1,647,904) C2. Repayments (260,000) (1,484) - - (261,484) C3. Decreases in fair value (2,279) (1,233) (56) - (3,568) C4. Transfers to other portfolios - - - - -

C5. Other changes (17,406) (14,678) - - (32,084) tatements

D. Net closing balance 252,787 16,562 5,466 - 274,815 S

Section 4 - Financial assets available

for sale - Item 40 inancial F 4.1 Financial assets available for sale: breakdown by type

Items/Amounts 2010 2009 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 1. Debt securities 1.1 Structured securities 20,427 - 41,875 15,240 813 40,839

1.2 Other debt securities 151,249 56,465 25,223 165,710 45,993 8,238 onsolidated

2. Equity securities C 2.1 Designated at fair value 35,577 - 3,766 17,333 - 18,902 the

2.2. At cost - - 2,870 - - 114 3. UCI units 52,566 - 9,390 51,728 - 8,200 to 4. Loans ------Total 259,819 56,465 83,124 250,011 46,806 76,293 otes N

Notes to the Consolidated Financial Statements - Part B • 83 FINANCIAL YEAR 2010

4.2 Financial assets available for sale: breakdown by borrower/issuer

Items/Amounts 2010 2009 1. Debt securities a) Governments and central banks 62,241 98,017 b) Other government authorities 992 987 c) Banks 197,698 133,095 d) Other issuers 34,308 44,734 2. Equity securities a) Banks 169 16,741 b) Other issuers - Insurance Companies 1,442 31 - Financial companies 6,134 12,981 - Non-financial companies 34,468 6,596 - Other - - 3. UCI units 61,956 59,928 4. Loans a) Governments and central banks - - b) Other government authorities - - c) Banks - - d) Other entities - - Total 399,408 373,110

4.3 Financial assets available for sale covered by specific hedges

As at 31 December 2010 no financial asset available for sale was covered by a specific hedge. NOTA INTEGRATIVA CONSOLIDATA - PARTE B

84 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

4.4 Financial assets available for sale: annual changes

Debt Equity UCI units Loans Total securities securities A. Opening balance 276,833 36,349 59,928 - 373,110 B B. Increases B1. Purchases 191,956 66,971 1,462 - 260,389 art B2. Increases in fair value 1,523 1,041 1,683 - 4,247 B3. Write-backs - P - Allocated to the income statement - x - - - - Allocated to shareholders' equity - - - - - B4. Transfers from other portfolios - Financial assets held for trading ------Financial assets held to maturity - - - - - B5. Other changes 9,375 6,463 - - 15,838

C. Decreases tatements

C1. Sales (98,469) (62,162) (674) - (161,305) S C2. Repayments (71,031) - - - (71,031) C3. Decreases in fair value (6,692) (3,449) (411) - (10,552) C4. Write-downs due to impairment - Allocated to the income statement - (1,944) - - (1,944)

- Allocated to shareholders' equity - - - - - inancial

C5. Transfers to other portfolios - - - - - F C6. Other changes (8,256) (1,056) (32) - (9,344) D. Net closing balance 295,239 42,213 61,956 - 399,408

Section 5 - Financial assets held to maturity - Item 50 onsolidated C 5.1 Financial assets held to maturity: breakdown by type the Type of 2010 2009

transaction/ Fair value Fair value to

Amounts Book Book value Level 1 Level 2 Level 3 value Level 1 Level 2 Level 3 1. Debt securities otes - Structured 5,627 5,670 - - 5,551 5,651 - - N - Other ------2. Loans ------Total 5,627 5,670 - - 5,551 5,651 - -

Notes to the Consolidated Financial Statements - Part B • 85 FINANCIAL YEAR 2010

5.2 Financial assets held to maturity: breakdown by borrower/issuer

Type of transaction/Amounts 2010 2009

B 1. Debt securities a) Governments and central banks - -

art b) Other government authorities - - c) Banks 5,627 5,551

- P d) Other issuers - - 2. Loans a) Governments and central banks - - b) Other government authorities - - c) Banks - - d) Other entities - - Total 5,627 5,551 tatements Fair value 5,670 5,651 S

5.3 Financial assets held to maturity covered by specific hedges

Not applicable inancial

F 5.4 Financial assets held to maturity: annual changes

Debt securities Loans Total A. Opening balance 5,551 - 5,551 B. Increases - - - B1. Purchases - - - B2. Write-backs - - - onsolidated B3. Transfers from other portfolios - - - C B4. Other changes 117 - 117 C. Decreases - - - the C1. Sales - - - C2. Repayments - - - to

C3. Write-downs - - - C4. Transfers to other portfolios - - -

otes C5. Other changes (41) - (41)

N D. Net closing balance 5,627 - 5,627

86 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

Section 6 - Loans to banks - Item 60

6.1 Loans to banks: breakdown by type

Type of transaction/Amounts 2010 2009 B A. Loans to central banks

1. Term deposits - - art 2. Reserve requirements 10,590 7,674

3. Repurchase agreements - - - P 4. Other - - B. Loans to banks - - 1. Current accounts and demand deposits 65,938 266,415 2. Term deposits 50,029 6,843 3. Other loans: 3.1 Repurchase agreements 26,707 21,563 3.2 Finance leases - - tatements S 3.3 Other 41,448 34,540 4. Debt securities 4.1 Structured securities 30,310 70,173 4.2 Other debt securities 35,002 34,667 Total (book value) 260,024 441,875 Total (fair value) 258,987 442,407 inancial F

6.2 Loans to banks covered by specific hedges

This item is not applicable to the Banca Intermobiliare Group.

6.3 Finance leases

This item is not applicable to the Banca Intermobiliare Group. onsolidated C the

to

otes N

Notes to the Consolidated Financial Statements - Part B • 87 FINANCIAL YEAR 2010

Section 7 - Loans to clients - Item 70

7.1 Loans to clients: breakdown by type

B 2010 2009 Type of transaction/Amounts Performing Non-performing Performing Non-performing 1. Current accounts 882,916 144,355 802,246 184,409 art 2. Repurchase agreements 7,020 - 13,376 - 3. Mortgages 430,825 26,264 300,632 137,180 - P 4. Credit cards, personal loans and loans secured by one-fifth of salary - - - - 5. Finance leases - - - - 6. Factoring - - - - 7. Other transactions 351,186 7,190 280,220 4,864 8. Debt securities

tatements 8.1 Structured securities - - - -

S 8.2 Other debt securities 5,494 - 10,249 - Total (book value) 1,677,441 177,809 1,406,723 326,453 Total (fair value) 1,677,476 177,809 1,406,960 326,453

As at 31 December 2010, “Net non-performing assets” totalled EUR 178 million, a decrease compared to EUR 326 million as at 31 December 2009. The status of these positions and the validity and force of the above collateral were inancial reviewed and substantiated by outside legal opinions and analyses conducted by the Bank’s management. For further F information on non-performing assets, see the comments in the Consolidated Report on Operations under “Loans and other credit facilities to customers,” and Part E - Information on risks and related hedging policies in the “Credit risk” section. onsolidated C the to otes N

88 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

7.2 Loans to clients: breakdown by borrower/issuer

Type of transaction/ 2010 2009 Amounts Performing Non-performing Performing Non-performing

1. Debt securities issued by: B a) Governments - - - -

b) Other government authorities - - - - art c) Other issuers - Non-financial companies 2,920 - 2,884 - - P - Financial companies 2,574 - 7,365 - - Insurance companies - - - - - Other - - - - 2. Loans to: a) Governments - - - - b) Other government authorities - - - - c) Other entities tatements S - Non-financial companies 825,322 156,977 631,810 270,694 - Financial companies 265,413 2,095 247,240 33,880 - Insurance companies - - - - - Other 581,212 18,737 517,424 21,879 Total 1,677,441 177,809 1,406,723 326,453 inancial

7.3 Loans to clients covered by specific hedges F

This item is not applicable to the Banca Intermobiliare Group.

7.4 Finance leases

This item is not applicable to the Banca Intermobiliare Group.

Section 10 - Equity investments - Item 100 onsolidated C

10.1 Joint investments in subsidiaries (accounted using the equity the

method) and investments in companies subject to significant influence: information on equity investments to

Company name Head office Form of Investment share % votes available control (a) (b)

% otes

Investor company shareholding N A. Companies 1. Bim Vita S.p.A. Turin 8 Banca Intermobiliare S.p.A. 50% 50%

(a) Form of control: 8 Associate company (b) Actual votes that can be exercised at shareholders’ meeting

Notes to the Consolidated Financial Statements - Part B • 89 FINANCIAL YEAR 2010

10.2 Joint investments in subsidiaries and investments in companies subject to significant influence: accounting information B Company name Total assets Total Profit Shareholders' Consolidated Fair revenues (Loss) Equity book value value art A. Companies accounted for using the equity method

- P A.1 Subject to joint control ------A.2 Subject to significant influence 1. Bim Vita S.p.A. 282,165 138,034 54 11,900 5,950 n.a. B Companies consolidated proportionally ------

10.3 Equity investments: annual changes

tatements 2010 2009

S A. Opening balance 5,996 41,945 B. Increases B.1 Purchases - - B.2 Write-backs - 506 B.3 Revaluations - - inancial B.4 Other changes - - F C. Decreases C.1 Sales - - C.2 Write-downs - C.4 Other changes (46) (36,455) D. Net closing balance 5,950 5,996 E. Total revaluations - - F. Total adjustments - - onsolidated

C The change in 2010 was due entirely to the affiliate Bim Vita S.p.A. The decrease in 2009, which was recorded under item C4, was due to the transfer of the equity investment in Ipi S.p.A. to “Non-current assets held for sale and later disposed of during the period.” the

to 10.4 Commitments related to joint investments in subsidiaries

This item is not applicable to the Banca Intermobiliare Group. otes N 10.5 Commitments related to investments in companies subject to significant influence

This item is not applicable to the Banca Intermobiliare Group.

90 • Notes to the Consolidated Financial Statements - Part B

FINANCIAL YEAR 2010

Section 12 - Tangible fixed assets - Item 120

12.1 Tangible fixed assets: breakdown of assets carried at cost

Assets/Value 2010 2009 B A) Assets for operating use

1.1 Owned assets art a) Land 56,602 45,604 b) Buildings 33,507 41,426 - P c) Furniture 2,431 2,501 d) Electronic systems 1,615 1,793 e) Other 1,650 1,203 f) Leasehold improvements 3,587 3,837 1.2 Held under finance leases a) Land 34,270 34,270 b) Buildings 28,564 29,278 tatements S c) Furniture - - d) Electronic systems - - e) Other - - Total A 162,226 159,912 B. Assets held for investment purposes 2.1 Owned assets inancial a) Land - - F b) Buildings - - 2.2 Held under finance leases a) Land - - b) Buildings - - Total B - - Total (A + B) 162,226 159,912 onsolidated C The figure at 31 December 2009 was restated based on information provided in Part A - Section 5 “Other aspects” to reflect the consolidation of assets held by the subsidiary Immobiliare D S.r.l., which were previously recorded under the

“Non-current assets and disposal groups held for sale” in accordance with IFRS 5. The amount of the reclassification was EUR 34,050,000, which is equal to the value stated in the recent real estate appraisal carried out by the to subsidiary Immobiliare D S.r.l. At 31 December 2010, the Group’s real estate appraisals were updated resulting in appraised values higher than book values. The fair values of real properties compared to previous appraisals showed that they held their market value, and there was a significant increase for certain properties. otes N

12.2 Tangible fixed assets: breakdown of assets designated at fair value or revalued

This item is not applicable to the Banca Intermobiliare Group.

Notes to the Consolidated Financial Statements - Part B • 91 FINANCIAL YEAR 2010

12.3 Tangible assets for operating use: annual changes

Land Buildings Furniture Electronic Other Leasehold Total systems improvements A. Opening balance 79,874 78,682 9,385 4,742 8,928 16,057 197,668 B A.1 Net total of write-downs - (7,978) (6,884) (3,681) (6,993) (12,220) (37,756) A.2 Net opening balance 79,874 70,704 2,501 1,061 1,935 3,837 159,912 art B. Increases: B.1 Purchases - 9 391 176 314 460 1,350 - P B.2 Capitalised improvement costs ------B.3 Write-backs ------B.4 Increases in fair value allocated to: a) shareholders’ equity ------b) income statement ------B.5 Positive exchange differences 627 2,673 48 27 22 - 3,397

tatements B.6 Transferred from property held

S for investment purposes ------B.7 Other changes 10,371 161 87 1,251 121 171 12,162 C. Decreases: C.1 Sales - - (74) (259) (148) - (481) C.2 Depreciation - (1,408) (520) (599) (578) (881) (3,986) C.3 Write-downs for impairment inancial allocated to F a) shareholders’ equity ------b) income statement ------C.4 Decreases in fair value allocated to: a) shareholders’ equity ------b) income statement ------C.5 Negative exchange differences ------C.6 Transfers to: onsolidated a) tangible assets held for investment

C purposes ------b) assets held for sale ------C.7 Other changes - (10,068) (2) (42) (16) - (10,128) the

D. Net closing balance 90,872 62,071 2,431 1,615 1,650 3,587 162,226 to D.1 Net total of write-downs - (3,613) (6,674) (7,404) (2,308) (10,420) (52,351)

D.2 Gross closing balance 90,872 65,684 9,105 9,019 3,958 14,007 214,577 E. Valuation at cost ------otes

N Total accumulated depreciation is recorded on lines A.1 and D.1 - Net total of write-downs. No amount is stated for sub-item E “Valuation at cost” since, as per Bank of Italy instructions, this item must be completed only for tangible assets designated in the financial statements at fair value.

92 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

12.4 Tangible assets held for investment purposes: annual changes

This item is not applicable to the Banca Intermobiliare Group.

12.5 Commitments to purchase tangible fixed assets B

As at 31 December 2010, there were no commitments to purchase tangible assets of any significant amount. art

Section 13 - Intangible fixed assets - Item 130 - P

13.1 Intangible fixed assets: breakdown by type of asset

Attività/Valori 2010 2009 Defined life Undefined life Defined life Undefined life

A.1 Goodwill - tatements

A.1.1 Pertaining to the group x 64,653 x 64,653 S A.1.2 Minority interests x 641 x 641 A.2 Other intangible assets A.2.1 Assets carried at cost a) Intangible fixed assets generated internally - - - -

b) Other assets 23,164 - 25,852 - inancial

A.2.2 Assets designated at fair value: F a) Intangible fixed assets generated internally - - - - b) Other assets - - - - Total 23,164 65,294 25,852 65,294

Goodwill recorded in the financial statements at 31 December 2010 totalled EUR 65,294,000, of which EUR 49,446,000 related to the subsidiary Symphonia Sgr and EUR 15,848,000 to the subsidiary Ipibi. onsolidated At 31 December 2010, the determination of the recoverable value of CGUs for equity investments recorded in C the financial statements at a book value higher than reported shareholders’ equity showed recoverable values that fully justified the surplus values recognised as goodwill. Thus, it was not necessary to apply any impairment to the the goodwill. to Paragraph 13.3 “Other information” in this section provides the methodologies used for impairment tests including the information required by IAS 36. otes N

Notes to the Consolidated Financial Statements - Part B • 93 FINANCIAL YEAR 2010

13.2 Intangible fixed assets: annual changes

Goodwill Other intangible assets Other intangible assets: Total generated internally other def undef def undef B A. Opening balance 65,294 - - 36,673 - 101,967 A.1 Net total of write-downs - - - (10,821) - (10,821) art A.2 Net opening balance 65,294 - - 25,852 - 91,146 B. Increases

- P B.1 Purchases - - - 1,468 - 1,468 B.2 Increases in internal intangible fixed assets x - - - - - B.3 Write-backs x - - - - - B.4 Increases in fair value - - allocated to shareholders’ equity x ------allocated to income statement x - - - - - tatements B.5 Positive exchange differences - - - 90 - 90 S B.6 Other changes - - - 20 - 20 C. Decreases - C.1 Sales ------C.2 Write-downs - Amortisation - - - (4,252) - (4,252) inancial - Writedowns - F + Shareholders' Equity ------+ Income statement ------C.3 Decreases in fair value - allocated to shareholders’ equity ------allocated to income statement ------C.4. Transfers to non-current assets held for sale ------onsolidated C.5 Negative exchange differences ------

C C.6 Other changes - - - (14) - (14) D. Net closing balance 65,294 - - 23,164 - 88,458 the D.1 Net total of write-downs - - - (15,073) - (15,073)

E. Gross closing balance 65,294 - - 38,251 - 103,545 to

E. Valuation at cost ------otes N

94 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

13.3 Additional information Procedures used for impairment tests

Impairment tests are performed at least annually, in accordance with IAS 36, with reference to the verification of potential losses in goodwill value recorded in the consolidated financial statements and resulting from acquisitions of B equity investments or business units.

The commonly used valuation process is the following: art • Identification of cash generating units (CGUs) and allocation of related goodwill;

• Determination of the book value of the CGU; - P • Determination of the recoverable value using the reference valuation method known as discounted cash flow (DCF). For financial companies, DCF is commonly applied to the so-called dividend discount model (DDM), which calls for discounting cash flows that are generated and that can potentially be distributed taking into account the absorption of capital from operations and the available excess capital. The model is applied on the basis of operating and financial figures reported in year-end final results or in the budget and/or business plans approved by the boards of directors of the companies concerned;

• Performance of sensitivity analysis to verify the sensitivity of the valuation - determined using the impairment test tatements

- to changes in the key assumptions and parameters. In particular, an analysis that measures the degree of change S in assumptions and parameters beyond which the impairment test cannot substantiate the goodwill allocated to the CGU is performed; • Any other consideration concerning the existence of external indicators of impairment in absence of asset write- downs; • Directors’ approval of the impairment procedure prior to the approval of the financial reports. inancial

At 31 December 2010, the valuations of equity investments recorded in the financial statements at a book value F higher than reported shareholders’ equity showed recoverable values that fully justified the surplus values recognised as goodwill. Thus, it was not necessary to apply any impairment to the goodwill. onsolidated C the

to

otes N

Notes to the Consolidated Financial Statements - Part B • 95 FINANCIAL YEAR 2010

Description of the impairment test on goodwill recorded for Symphonia

For the purposes of the impairment test, the entity resulting from the merger on 1 January 2010 of Bim Alternative Investments Sgr into Symphonia Sgr was identified as the only Cash Generating Unit to which the goodwill

B resulting from the acquisition of Symphonia Sgr and Bim Alternative Sgr was allocated. The decision to consider the post-merger company as the only cash generating unit is substantiated by the decision-

art making process (a single management team that makes strategic and operating decisions), by the internal reporting procedure and by the changes in the characteristics of the business which reflects an increasing convergence between traditional products and hedge products. - P

The value of the Cash Generating Unit (EUR 128.1 million) corresponds to the contribution of Symphonia Sgr and Bim Alternative Investments Sgr to consolidated net assets, and to the value of the goodwill, totalling EUR 49,400. In order to determine the recoverable value of the Cash Generating Unit, value in use was applied. The value in use of Symphonia Sgr was determined by applying the dividend discount method (DDM), which calls for the capitalisation of cash flows generated for the group that may potentially be distributed (including the terminal value

tatements of the company calculated on the basis of the standard capacity to generate income), to which excess capital must

S be added as necessary.

The model was applied on the basis of the following operating and financial figures: - Final results for 2010; - The 2011 budget for Symphonia Sgr approved by its board of directors. The use of this document is substantiated by the fact that it represents the formal instrument used by directors to plan and manage the company’s operations. inancial The Financial year 2010 ended with a profit of EUR 6.2 million compared to EUR 10.8 million in 2009; this F reduction was mainly due to lower performance fees that had made a positive contribution in the previous year. At 31 December 2010, AUM (net of Group duplications) were up 4% to EUR 4,256 million. Budget figures were adjusted to take into account the lack of income generated by excess capital, which is assessed separately, and 50% of income generated from the merger with Banca Ipibi, which was already allocated to the latter as income synergies.

Income synergies generated from Banca Intermobiliare due to the presence of Symphonia Sgr in the group were also allocated to the assessed Cash Generating Unit. onsolidated These synergies largely included: C - Trading fees for trading operations carried out by Symphonia Sgr through Banca Intermobiliare; - Fees for custodial bank services carried out by Banca Intermobiliare on behalf of the GPM lines of Symphonia Sgr; the

- The spread generated by the return on current accounts on which the cash from GPM lines is deposited. These synergies, which can be measured by management control systems, are significant for the overall valuation, to

and are unequivocally attributable to the fact that Symphonia Sgr is a part of the Banca Intermobiliare Group. These synergies do not represent, among other things, a cost for Symphonia Sgr since they are costs incurred by investment funds and GPMs. otes

N The cash flows used for the purposes of DDM projections totalled EUR 6,200 for 2010 (corresponding to the net profit of Symphonia) and projected cash flows for 2011 were EUR 8,100. Excess capital of EUR 27.2 million was added to the value determined from the discounting of cash flows. This calculation took into consideration both the minimum current regulatory capital and the regulatory capital required for the company’s future growth. della crescita futura della società.

96 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

The following parameters were used to apply the model: i) a cost of equity of 8.9% (8.5% for the previous year) determined on the basis of: • Risk free rate: a figure of 4.6% (4% the previous year) was used, which is equal to the average return on the ten- year BTP [multi-year treasury bond] for the last month of the year;

• Risk premium of 4.5% (unchanged from the previous year) based on the implicit value in current market prices B and the average amount for past years; • Beta of 0.96 (1 in the previous year) based on the volatility of competitors/comparables: over the two-year period art 2009-2010 Betas between 0.87 and 1 were observed; ii) a g of 1% (prudential indicator of limited economic growth and inflation). - P

Using this model, the value of the CGU was determined at EUR 225.5 million, which is substantially higher than its book value and thus no external indicators of impairment were found.

In addition, a sensitivity analysis was performed on: - the two main operating variables: assets and return on assets; - the two main DDM parameters: Beta and growth rate, g. tatements

Sensitivity analysis S (Millions of €)

Assets -10% +10% Value of CGU 208.8 242.2

Gross return -10 bp +10 bp inancial

Value of CGU 210.1 240.8 F Beta +0.25 -0.25 Value of CGU 201.6 257.3 Growth rate, g -0.5% +0.5% Value of CGU 214.1 238.4 Synergies -25% +25% Value of CGU 204.6 246.3 onsolidated For each variable, the degree of change necessary in order for the impairment test to fail to support the goodwill was C assessed. The outcome of these sensitivity analyses would indicate the need for impairment in the following cases: - assets down by 58%; the

- return down by 63 basis points; - Beta of 1.8, bringing Ke to 17%; to - g equal to -7.1%. otes N

Notes to the Consolidated Financial Statements - Part B • 97 FINANCIAL YEAR 2010

Description of the impairment test on goodwill recorded for Banca Ipibi

For the purposes of the impairment test, the value of goodwill resulting from the Banca IPIBI acquisition was allocated to the company overall, which was identified as the single Cash Generating Unit. B The book value of the CGU (EUR 48 million) corresponds to Ipibi’s contribution to consolidated net assets and to the value of goodwill (EUR 15,848). art In order to determine the recoverable value of the Cash Generating Unit, value in use was applied. The value in use of Banca IPIBI was determined by applying the dividend discount model (DDM), which calls for the capitalisation

- P of cash flows that are generated for the group and that can potentially be distributed taking into account the absorption of capital from operations and the available excess capital.

The model was applied on the basis of the following operating and financial figures: - Final results for 2010; - the 2011 budget for Banca Ipibi.

tatements The year 2010 ended with net interest and other banking income of EUR 8 million, an increase of 35.7%, with a

S net loss of EUR 2.3 million (compared to EUR 2.7 million in 2009). It should be noted that profits were negatively affected by the one-time costs related to the expansion of the financial advisor network and to the write-down of financial assets. The annual budget approved by the board of directors of Banca Ipibi on 15 December 2010 was used for the model. It updates the projections in the three-year plan of 2010-2013 (approved by the board of directors in December 2009) that was used for the impairment test for the previous financial year. During this financial year, Banca Ipibi inancial will update estimates for the other years covered by the plan taking into account sales performance at the beginning F of the year. Thus, the DDM model was applied using only the figures from the updated plans, i.e. the operating and financial figures from the 2011 budget, while for future years, to be conservative, no growth in assets was projected, except for the application of the perpetual growth rate (+1%).

The present value of expected income synergies from the inclusion of Banca Ipibi in the Banca Intermobiliare Group, and the bank’s cost associated with exercising Ipibi warrants were added to the valuation made using the DDM. onsolidated The DDM model is based on the assumption that operating results, generally speaking, correspond to cash flow. In C the case of Banca IPIBI, the accrual of charges for new financial advisors does not correspond to actual cash flows. As a result, for the purposes of implementing the DDM model, we adjusted the operating figures based on the true the manifestation of cash. A three-year period (2011-2013) was used for the projection of cash flows as part of the Bank’s valuation, also in to order to incorporate the last financial year (2012) in which deposit-related costs are incurred, to arrive at a standard year (2013). Distributable cash flows were calculated assuming the maintenance of a Core Tier 1 ratio of 8%. RWA were estimated taking into account changes in credit, counterparty, market and operational risk. otes With regard to the results used as a reference for the calculation of the Terminal Value, for the standard year, an N annual cost for deposits of approximately EUR 2 million was conservatively incorporated (this element explains the reason why the cash flow used in the Terminal Value is lower than that for a standard year). Excess capital available at 31 December 2010 amounting to approximately EUR 4.4 million (determined as the excess over the minimum level of regulatory capital of 8%), was added to the amount determined from the discounting of cash flows of EUR 39.7 million resulting in an equity value of EUR 44.2 million.

98 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

The following parameters were used to apply the model: i) a cost of equity of 8.9% (8.5% for the previous year) determined on the basis of: • Risk free rate: a figure of 4.6% (4% the previous year) was used, which is equal to the average return on the ten- year BTP [multi-year treasury bond] for the last month of the year;

• Risk premium of 4.5% (unchanged from the previous year) based on the implicit value in current market prices B and the average amount for previous years; • Beta of 0.96 (1 in the previous year) based on the volatility of competitors/comparables: over the two-year period art 2009-2010 Betas between 0.87 and 1 were observed; ii) a g of 1% (conservative indicator of contained levels of economic growth and inflation). - P

Income synergies generated for the Banca Intermobiliare Group due to the acquisition of Banca Ipibi were also allocated to the assessed Cash Generating Unit. These synergies involved the placement of Symphonia and Bim Vita products, the bond issuing and the trading activity of the parent company Banca Intermobiliare. In order to determine the value created by synergies, a standardised figure based on asset levels reached at the end of 2011, which will be productive in future years, was identified. In keeping with the DDM model, synergies were capitalised at a Ke of 8.92% and a g of 1%. tatements S

With reference to the impact of Ipibi warrants on the model, in keeping with the operating and financing figures used in the DDM, the maximum charge for the bank’s exercise of the warrants was estimated. Banca IPIBI has an incentive plan in place that calls for the allocation of 2.35 million warrants to the network for every billion euros in net inflow. The warrants entitle the holder to purchase Banca Ipibi shares in the ratio of one

share for every individual warrant at a price equal to shareholders’ equity plus goodwill calculated at 3% of assets inancial

(shares are made available by Banca Intermobiliare). Purchasers of the shares will have the right to sell such shares F to Banca Intermobiliare and/or Veneto Banca at any time for an amount which again is calculated as shareholders’ equity plus goodwill calculated at 3% of assets.

To summarise, on the basis of the DDM of EUR 44.2 million, the contribution of synergies and the cost related to the incentive plan were totalled, resulting in an overall valuation of EUR 61.8 million which is greater than the book value of the Cash Generating Unit; therefore, no external indicators of impairment were found. onsolidated C the

to

otes N

Notes to the Consolidated Financial Statements - Part B • 99 FINANCIAL YEAR 2010

In addition, a sensitivity analysis was performed on: - the two main operating variables: assets and return on assets; - the two main DDM parameters: Beta and growth rate, g. B Sensitivity analysis € art (Millions of ):

Assets -10% +10% - P Value of CGU 50.2 73.5 Gross return -10 bp +10 bp Value of CGU 55.0 68.7 Beta +0.25 -0.25 Value of CGU 53.8 72.6 Growth rate, g -0.5% +0.5%

tatements Value of CGU 58.3 65.8

S Synergies -25% +25% Value of CGU 57.5 66.2

For each variable, the degree of change needed for the impairment test to fail to support the goodwill was assessed. The outcome of this sensitivity analysis indicates the need for impairment in the following cases: inancial - assets down by about 12% in terminal value; F - return down by 20 basis points in terminal value; - Beta of 0.47, bringing Ke to 11.0%; - g equal to -1.4%; - synergies lower than 78%.

Other aspects The useful life of intangible fixed assets other than goodwill is defined; all intangible fixed assets are held for operating purposes and amortisation is performed on a straight-line basis on the remaining useful life. At 31 onsolidated December 2010, there were no commitments to purchase intangible assets of any significant amount. C the to otes N

100 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

Section 14 - Tax assets and liabilities - Item 140 of Assets and Item 80 of Liabilities

14.1 Deferred tax assets: breakdown B

Prepaid taxes are recorded for deductible temporary differences. The types of temporary differences that led to the recording of “deferred tax assets” are as follows: art

2010 2009 - P Banking Group Other Banking Group Other 1. Loans 25,411 - 27,167 - 2. Other financial instruments 5,459 - 5,215 - 3. Goodwill 57 - 77 - 4. Long-term charges - 147 - - 5. Tangible fixed assets - 64 - - tatements 6. Provisions for risks and charges 4,674 - 4,660 - S 7. Entertainment expenses 37 - 98 - 8. Personnel costs 542 - 724 - 9. Tax losses 1,294 - 914 19 10. Unused tax credits to be deducted - - - - 11. Other 866 - 37 128 inancial Deferred tax assets 38,340 211 38,892 147 F

14.2 Deferred tax liabilities: breakdown

The following table indicates the types of temporary differences that led to the recording of “deferred tax liabilities.”

2010 2009 Banking Group Other Banking Group Other onsolidated 1. Gains to be divided into instalments - - - - C 2. Goodwill 211 - 123 - 3. Tangible fixed assets 5,286 9,731 5,571 9,847 the 4. Financial Instruments 1,349 - 2,932 -

5. Personnel costs 195 - 203 - to

6. Other 6,454 - 7,258 - Deferred tax liabilities 13,495 9,731 16,087 9,847 otes N

Notes to the Consolidated Financial Statements - Part B • 101 FINANCIAL YEAR 2010

14.3 Changes in prepaid taxes (with balancing entry in income statement)

2010 2009

B 1. Opening balance 36,808 32,502 2. Increases

art 2.1 Prepaid taxes recognised during the year a) for previous years 7 9,116 b) due to a change in accounting criteria - - - P c) write-backs - - d) other 2,335 - 2.2 New taxes or increases in tax rates - - 2.3 Other increases - - 3. Decreases 3.1 Prepaid taxes eliminated during the year tatements a) transfers (4,072) (4,800) S b) writedowns due to the inability to recover principal - - c) change in accounting criteria - - d) other - - 3.2 Reduction in tax rates - - 3.3 Other decreases (4) (10) inancial 4. Ending balance 35,074 36,808 F

14.4 Changes in deferred taxes (with balancing entry in income statement)

2010 2009 1. Opening balance 17,528 24,556 2. Increases - onsolidated 2.1 Deferred taxes recognised during the year - -

C a) for previous years 237 - b) due to a change in accounting criteria - - the NOTA INTEGRATIVA CONSOLIDATA - PARTE B

c) other - 335 2.2 New taxes or increases in tax rates - - to 2.3 Other increases 49 - 3. Decreases - - 3.1 Deferred taxes eliminated during the year - - otes a) transfers (387) (1,273) N b) due to a change in accounting criteria - - c) other - - 3.2 Reduction in tax rates - - 3.3 Other decreases (1,066) (6,090) 4. Ending balance 16,361 17,528

102 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

14.5 Changes in prepaid taxes (with balancing entry in shareholders’ equity)

2010 2009 B 1. Opening balance 2,231 - 2. Increases 2.1 Prepaid taxes recognised during the year art a) for previous years - - b) due to a change in accounting criteria - - - P c) other 603 2,231 2.2 New taxes or increases in tax rates - - 2.3 Other increases 857 - 3. Decreases 3.1 Prepaid taxes eliminated during the year

a) transfers (214) - tatements

b) writedowns due to the inability to recover principal - - S c) due to a change in accounting criteria - - d) other - - 3.2 Reduction in tax rates - - 3.3 Other decreases - - 4. Ending balance 3,477 2,231 inancial F

14.6 Changes in deferred taxes (with balancing entry in shareholders’ equity)

2010 2009 1. Opening balance 8,406 208 2. Increases 2.1 Deferred taxes recognised during the year onsolidated

a) for previous years - - C b) due to a change in accounting criteria - - c) other 302 2,335 the

2.2 New taxes or increases in tax rates - -

2.3 Other increases - 5,863 to

3. Decreases 3.1 Deferred taxes eliminated during the year a) transfers (1,845) - otes b) due to a change in accounting criteria - - N c) other - - 3.2 Reduction in tax rates - - 3.3 Other decreases - - 4. Ending balance 6,863 8,406

Notes to the Consolidated Financial Statements - Part B • 103 FINANCIAL YEAR 2010

14.7 Additional information

The following is information on assets and liabilities for current taxes.

B 2010 2009 A. Gross current tax assets A1. Advance IRES payments 6,595 59 art A2. Advance IRAP payments 4,591 2,474 A3. Other credits and withholdings 3,593 2,870 - P B. Offset against current tax liabilities (1,038) - C. Net current tax assets 13,741 5,403

2010 2009 A. Gross current tax liabilities A1. IRES tax payables 3,806 4,278 tatements A2. IRAP tax payables 4,012 4,601

S A3. Other current income tax payables 22 240 B. Offset against current tax assets (1,038) - C. Net current tax liabilities 6,802 9,119

Option to use the national tax consolidation regime

inancial For the three-year period 2010-2012, the Group decided once again to use the group taxation regime pursuant to

F Article 117 of the TUIR [Income Tax Consolidation Act]. The consolidation area (which, pursuant to the TUIR, may include companies that are subsidiaries on 1 January of the year in which the option is renewed or exercised) includes Cofito S.p.A., as the holding company, Symphonia SGR S.p.A., Bim Fiduciaria S.p.A., Bim Immobiliare S.r.l. and Immobiliare D S.r.l. (equity investment purchased by Banca Intermobiliare on 28 December 2009 to recover loans) as consolidated companies. Banca Ipibi was not included in Cofito’s consolidation area since the percentage held by the latter as a result of the “gearing down”, due to the presence of Bim in the related equity investment chain, was 36%. onsolidated C the to otes N

104 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

Section 15 - Non-current assets and disposal groups held for sale and related liabilities - Item 150 of Assets and Item 90 of Liabilities B On 29 December 2009, following notice given to the supervisory authorities, the Parent Company Banca Intermobiliare, by means of a public document, acquired 100% of the shares in Immobiliare D S.r.l. as part of a transaction aimed at recovering a credit exposure which was secured by real estate properties held by art the acquired equity investment. Starting with the annual financial statements as at 31 December 2009, this equity investment was recorded under assets held for sale as dictated by IFRS 5. - P At the annual financial closing date of 31 December 2010 - since 12 months had elapsed within which the disposal of the equity investment could have been completed and since, at that time, the prerequisites were no longer met to consider the disposal to be highly likely, even though all actions aimed at completing such a disposal had been completed - Banca Intermobiliare chose to reclassify the equity investment in Immobiliare D S.r.l. from the item “Non-current assets and disposal groups held for sale” to “Equity investments” and thus it is consolidated on a line-by-line basis. tatements S Section 16 - Other assets - Item 160

16.1 Other Assets: breakdown

Items/Amounts 2010 2009 inancial - Due from inland revenue and other tax authorities 14,776 21,589 F - Current account cheques drawn on third parties 2,484 3,091 - Receivables for bond coupons and securities 749 282 - Security deposits 81 103 - Work in process items 5,445 1,516 - Accrued income not related to Group items 45 26 - Prepaid expenses not related to Group items 7,759 3,487 - Other

Trade receivables 3,413 4,247 onsolidated

Other loans and receivables 8,839 10,959 C TOTAL 43,591 45,300 the

to

PASSIVO otes N

Notes to the Consolidated Financial Statements - Part B • 105 FINANCIAL YEAR 2010

LIABILITIES

Section 1 - Due to banks - Item 10 B 1.1 Due to banks: breakdown by type

art Transaction type/Group components 2010 2009 1. Due to central banks 85,001 93,398

- P 2. Due to banks 2.1 Current accounts and demand deposits 67,113 83,990 2.2 Term deposits 30,000 67,459 2.3 Loans 2.3.1 Repurchase agreements - - 2.3.2 Other 263,665 247,004 2.4 Payables for commitments to repurchase Group equity instruments - - tatements 2.5 Other payables 8,215 1,483 S Total 453,994 493,334 Fair value 453,994 493,334

Item 2.3.2 consists of a loan made by leading banks over previous years for a term of 5 years; the loan was repaid in February 2011. inancial 1.2 Detail of Item 10 “Due to banks”: subordinated debt F This item is not applicable to the Banca Intermobiliare Group.

1.3 Detail of Item 10 “Due to banks”: structured debt This item is not applicable to the Banca Intermobiliare Group.

1.4 Payables to banks covered by specific hedges

onsolidated This item is not applicable to the Banca Intermobiliare Group. C 1.5 Payables related to finance leases the

This item is not applicable to the Banca Intermobiliare Group. to otes N

106 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

Section 2 - Due to clients: Item 20

2.1 Due to clients: breakdown by type B

Transaction type/Group components 2010 2009 art 1. Current accounts and demand deposits 1,520,562 1,815,112 2. Term deposits 497 1,131 - P 3. Loans 3.1 Repurchase agreements 58,526 132,412 3.2 Other 160,203 13,840 4. Payables for commitments to repurchase Group equity instruments - - 5. Other payables 10,819 16,551 Total 1,750,607 1,979,046

Fair value 1,750,607 1,979,046 tatements S

2.2 Detail of Item 20 “Due to clients”: subordinated debt This item is not applicable to the Banca Intermobiliare Group.

2.3 Detail of Item 20 “Due to clients”: structured debt inancial

This item is not applicable to the Banca Intermobiliare Group. F

2.4 Payables to clients covered by specific hedges This item is not applicable to the Banca Intermobiliare Group

2.5 Payables related to finance leases

2010 2009 Payables related to finance leases 10,707 14,116 onsolidated C

Payables related to finance leases were for a real estate lease transaction carried out by the subsidiary Bim Immobiliare the

S.r.l. to

otes N

Notes to the Consolidated Financial Statements - Part B • 107 FINANCIAL YEAR 2010

Section 3 - Outstanding securities - Item 30

3.1 Outstanding securities: breakdown by type B Type of 2010 2009 securities/ Fair Value Fair Value art Amounts Book Book value value Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 - P A. Securities 1. Bonds 1.1 Structured bonds 77,277 - - 77,160 55,761 - - 56,088 1.2 Other bonds 333,805 131,571 - 235,355 302,505 132,775 - 173,135 2. Other securities

tatements 2.1 Structured

S securities ------2.2 Other securities 4,365 - 4,365 - 7,315 - 7,315 - Total 415,447 131,571 4,365 312,515 365,581 132,775 7,315 229,223

3.2 Detail of Item 30 “Outstanding securities”: subordinated securities inancial

F The only subordinated bond recorded in the financial statements is for the issue of the Bim“ Convertible 1.5% 2005- 2015” bond, the only bond listed on the Milan Stock Market.

3.3 Detail of Item 30 “Outstanding securities”: securities covered by specific hedges

This item is not applicable to the Banca Intermobiliare Group. onsolidated C the to otes N

108 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

Section 4 - Financial liabilities held for trading - Item 40

4.1 Financial liabilities held for trading: breakdown by type B Transaction type/ 2010 2009 Group components art NV FV FV* NV FV FV* Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 - P A. Non-derivative liabilities 1. Due to banks 105 412 - - 412 42 187 - 2 190 2. Due to clients 951 6,817 - 1,591 8,408 2,524 7,100 - - 7,100 3. Debt securities 3.1 Bonds

3.1.1 Structured bonds - - - - x - - - - x tatements

3.1.2 Other bonds - - - - x - - - - x S 3.2 Other securities 3.2.1 Structured securities - - - - x - - - - x 3.2.2 Other securities - - - - x - - - - x Total A 1,056 7,229 - 1,591 8,820 2,566 7,287 - 2 7,290 inancial B. Derivatives F 1. Financial derivatives 1.1 Held for trading x 24,871 112,108 2,204 x x 226 76,724 320 x 1.2 Connected with fair value option x - - - x x - - - x 1.3 Other x - - - x x - - - x 2. Credit derivatives 2.1 Held for trading x - 1,526 - x x - 1,364 - X

2.2 Connected with onsolidated fair value option x - - - x x - - - X C 2.3 Other x - - - x x - - - X Total B x 24,871 113,634 2,204 x x 226 78,088 320 X the

Total (A+B) x 32,100 113,634 3,795 x x 7,513 78,088 322 X

* Fair value adjusted for change in credit rating to

4.2 Detail of Item 40 “Financial liabilities held for trading”: Subordinated liabilities otes N This item is not applicable to the Banca Intermobiliare Group.

4.3 Detail of Item 40 “Financial liabilities held for trading”: Structured debt

This item is not applicable to the Banca Intermobiliare Group.

Notes to the Consolidated Financial Statements - Part B • 109 FINANCIAL YEAR 2010

4.4 Non-derivative financial liabilities (excluding “technical exposure”) held for trading: annual changes

B Non-derivative financial liabilities held for trading only refer to technical exposure.

art Section 6 - Hedging derivatives - Item 60

- P 6.1 Hedging derivatives: breakdown by type of hedge and level

Fair Value NV Fair Value NV 2010 2010 2009 2009 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 A) Financial derivatives 1) Fair value ------

tatements 2) Cash flows 148 - - 10,927 94 - - 14,054

S 3) Foreign investments ------B Credit derivatives 1) Fair value ------2) Cash flows ------Total 148 - - 10,927 94 - - 14,054 inancial F 6.2 Hedging derivatives: breakdown by hedged portfolio and type of hedge

As at 31 December 2009, hedging derivatives totalled EUR 148,000; they were mainly used to hedge, by means of interest rate swaps, the cash flows related to an equity investment that Bim Immobiliare carried out.

onsolidated Section 8 - Tax liabilities - Item 80 C

See Section 14 under assets, “Tax assets and tax liabilities.” the to Section 9 - Liabilities associated with assets held for sale - Item 90

otes See Section 15 under assets, “Non-current assets and disposal groups held for sale and related liabilities.” N

110 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

Section 10 - Other liabilities - Item 100

10.1 Other liabilities: breakdown B Items/Amounts 2010 2009 - Amounts to be paid to tax authorities 11,481 13,538 art - Payables to social security agencies 1,811 2,040 - Third party amounts used for security deposits 46 57 - Other staff payables 7,088 8,459 - P - Work in process items 7,913 3,724 - Deferred credits not related to Group items 333 331 - Payables resulting from deterioration in credit commitments 596 1,652 - Other trade payables 16,851 9,980

broker payables 12,306 9,937 tatements

Other payables 3,504 4,207 S Total 61,929 53,925

Section 11 - Employees’ severance fund -

Item 110 inancial F 11.1 Employees’ severance fund: annual changes

2010 2009 A. Opening balance 4,569 4,707 B. Increases B.1 Provision for the year 2,414 2,360 B.2 Other changes 251 674

C. Decreases onsolidated

C.1 Payments (2,187) (2,836) C C.2 Other changes (403) (336) the

D. Net closing balance 4,644 4,569 Total 4,644 4,569 to

otes N

Notes to the Consolidated Financial Statements - Part B • 111 FINANCIAL YEAR 2010

11.2 Additional information

The following table indicates the actuarial assumptions for the calculation of the discounted value of the employees’ severance fund as required by IAS 19. B ASSUMPTIONS 31.12.2010 Economic assumptions art Annual discounting rate 4.5% Annual inflation rate 2.0% - P Annual salary increase rate 3.0% Demographic assumptions Death (publication of General State Accountancy) RGS 48 Mortality Tables Invalidity INPS Tables broken down by age and sex Retirement age 100% upon achieving AGO requirements Turnover and advances of employees' severance fund tatements Incidence of advances 2.0%

S Turnover frequency Table 5.4

Section 12 - Provisions for risks and charges - Item 120 inancial

F 12.1 Provisions for risks and charges: breakdown

Items/Amounts 2010 2009 1. Company pension provisions - - 2. Other provisions for risks and charges 2.1 Legal disputes 13,693 13,865 2.2 Personnel-related charges 488 710 2.3 Other - 3,017 onsolidated Total 14,181 17,592 C the to otes N

112 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

12.2 Provisions for risks and charges: annual changes

Items/Components Total Pension provisions Other provisions

A. Opening balance - 17,592 B B. Increases

B.1 Provision for the year - 2,914 art B.2 Changes due to the passage of time - 465 B.3 Changes due to changes in discount rate - - - P B.4 Other changes - - C. Decreases C.1 Utilisation during the year - (2,707) C.2 Changes due to changes in discount rate - - C.3 Other changes - (4,083) D. Net closing balance - 14,181 tatements S 12.3 Company defined-benefit pension provisions This item is not applicable to the Banca Intermobiliare Group.

12.4 Provision for risks and charges - other provisions inancial

The “Provision for risks and charges - other provisions” covers the risks of lawsuits or claims made against the Group, F and was determined by separately assessing each existing case. It mainly addresses contingent liabilities and risks related to disputes of various sorts related, among other things, to the disloyalty of former advisors or complaints, and any related reimbursements made to customers. onsolidated C the

to

otes N

Notes to the Consolidated Financial Statements - Part B • 113 FINANCIAL YEAR 2010

Section 15 - Group equity - Items 140, 160, 170, 180, 190, 200 and 220

15.1 “Capital” and “Treasury shares”: breakdown B

Items/Amounts 2010 2009

art Share capital Ordinary shares 156,209 156,038

- P Preference shares - - Treasury shares (34,416) (33,802)

15.2 Capital - Number of Parent Company shares: annual changes

Items/Types Ordinary shares Other shares tatements A. Share balance at the beginning of the year

S - Fully paid 156,037,608 - - Not fully paid - - A.1 Treasury shares (-) (6,970,101) - A.2 Outstanding shares: Opening balance 149,067,507 - B. Increases inancial B.1 New issues

F - paid: - business combination transactions - - - conversion of bonds - - - exercise of warrants - - - other 171,855 - - free of charge: - to employees - - - to directors - - onsolidated - other - - C B.2 Sale of treasury shares 207,628 - B.3 Other changes - - the

C. Decreases

to C.1 Elimination - -

C.2 Purchase of treasury shares (405,473) - C.3 Company sale transactions - - otes C.4 Other changes - - N D. Outstanding shares: Net closing balance 149,041,517 - D.1 Treasury shares (+) 7,167,946 - D.2 Share balance at the end of the year - Fully paid 156,209,463 - - Not fully paid - -

114 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

15.3 Capital: Additional information At 31 December 2010 the Bank’s share capital totalled EUR 156,209,000 consisting of 156,209,463 ordinary shares with a nominal value of EUR 1 each. In accordance with the Articles of Association, each ordinary share grants the holder the right to one vote at the shareholders’ meeting. Share capital was fully paid-in. B

Trading of treasury shares

The Parent Company has the exclusive right to trade treasury shares in accordance with resolutions made by the art shareholder meeting of 23 April 2010 and pursuant to Articles 2357 and 2357-ter of the Civil Code. The board of

directors may grant authorisation to purchase and hold treasury shares, using the shares as payment in extraordinary - P transactions or to fulfil obligations related to distribution programmes, to share options or shares provided to directors, employees and consultants, and to programmes for the free allocation of shares to shareholders.

Purchases and sales during the financial year At 31 December 2010, the Group held 7,167,946 Banca Intermobiliare shares compared to 6,970,101 shares held at the end of the previous year.

In accordance with the provisions of resolutions to authorise the purchase and sale of treasury shares, the Bank tatements

carried out the following transactions during the year: S - Market purchases of 405,473 shares for a total of EUR 1.6 million, allocated to the trading portfolio; - Market sales of 207,628 shares totalling EUR 800,000.

15.4 Retained earnings: Additional information

The legal reserve, which was established by law, must be equal to at least one fifth of share capital; in the past it was inancial

funded by allocations equal to 5% of annual net profits. F The statutory or undivided profit reserve is formed in accordance with the Articles of Association by allocating the portion of profit remaining after the distribution of profits on shares. Lastly, other reserves are funded as a result of allocations of shares and stock options and as a balancing entry for the elimination of operating components resulting from the trading of treasury shares. onsolidated C the

to

otes N

Notes to the Consolidated Financial Statements - Part B • 115 FINANCIAL YEAR 2010

Information required by Article 2427, paragraph 7-bis, of the Civil Code

Items Amount Possible use Available Summary portion of uses over last three years To cover losses For other uses

B Share capital 156,209 Equity instruments 30,023 art Issue premiums - a-b - (138) Reserves

- P Statutory reserve: legal reserve 31,128 b 31,128 Undivided profit reserve 56,910 a-b-c 56,910 (67,657) (32,044) Reserve for purchase of treasury shares 83,776 a-b-c 83,776 (23,225) Reserve for treasury shares 34,415 (1,921) Transition to IAS - reserves generated by IAS 39: fair value designation of financial instruments held tatements for trading 464 a-b-c 464 (276)

S - reserves generated by IAS 39: other 4,942 a-b-c 4,942 (54) - reserves generated by other valuations in accordance with IAS/IFRS 2,113 a-b-c 2,113 Other reserves - reserve formed as a balancing entry to the recording of shares and stock options in the inancial income statement 12,155 a-b 12,155

F - balancing entry of reversal of profits/losses generated by treasury share trading (2,656) a-b (2,656) - negative consolidation reserves 316 a-b 316 Valuation reserves Valuation reserve for assets available for sale (4,550) 1 (59,752) Valuation reserves for tangible fixed assets 14,033 1 (135) Foreign exchange reserves 5,917 1 Cash flow valuation reserves (92) onsolidated Treasury shares (34,416) (52,211) C Minority interests 9,188 Profit for the year 10,253 the Total 410,128 189,148 to

Possible use: Additional information: a = capital increase 1 - Reserve is not available pursuant to Art. 6 of Italian Legislative Decree 38/2005 (b) b = to cover losses c = for distribution to shareholders otes N 15.5 Additional information Not applicable.

116 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010

Section 16 - Minorities - Item 210

16.1 Minorities: breakdown B Items/Amounts 2010 2009 1. Share capital 5,782 5,782 art 2. Issue premiums - - 3. Reserves 5,217 6,565 4. (Treasury shares) - - - P 5. Valuation reserves (587) (163) 6. Equity instruments - - 7. Profit (loss) for the year (1,224) (1,404) Total 9,188 10,780

The minority interests are related to Bim Insurance Brokers S.p.A. and Banca Ipibi S.p.A. in which the Parent tatements Company Banca Intermobiliare holds a 51% and 67% stake, respectively. S

Additional information

1. Guarantees and commitments

Transactions 2010 2009 inancial 1) Financial guarantees issued F a) Banks 2,531 1,894 b) Clients 66,052 74,159 2) Trade guarantees issued - - a) Banks - - b) Clients 10,607 69 3) Irrevocable commitments to disburse funds - -

a) Banks - - onsolidated

i) usage certain 931 391 C ii) usage uncertain - 2,380

b) Clients - - the

i) usage certain 18,654 39,195 to

ii) usage uncertain 98,453 170,751 4) Underlying obligations for credit derivatives: sales of protection 31,245 58,000 5) Assets used to secure third party obligations 242,804 -

6) Other commitments 49,680 9,040 otes N Total 520,957 355,880

Notes to the Consolidated Financial Statements - Part B • 117 FINANCIAL YEAR 2010

2. Assets used to secure own liabilities and commitments

Portfolios 2010 2009 1. Financial assets held for trading 10,292 146,138

B 2. Financial assets designated at fair value - - 3. Financial assets available for sale 36,731 153,349

art 4. Financial assets held to maturity 2,653 5,533 5. Loans to banks 3,703 79,828 6. Loans to clients 2,287 9,829 - P 7. Tangible fixed assets - - Total 55,666 394,677

3. Information on operating leases This item is not applicable to the Banca Intermobiliare Group. tatements 4. Breakdown of investments to cover unit-linked S and index-linked policies This item is not applicable to the Banca Intermobiliare Group.

5. Asset management and trading on behalf of others

inancial Type of service 2010

F 1. Order execution on behalf of clients a) Purchases 1. settled 28,407,194 2. unsettled - b) Sales 1. settled 26,618,194 2. unsettled - 2. Asset management portfolios onsolidated a) individual 2,473,927 C b) collective 1,795,373 3. Custody and administration of securities the a) Third-party securities on deposit: connected with the performance of custodial bank services to (excluding portfolio management) 1. securities issued by companies included in consolidation 28,505 2. other securities - otes

N b) Third-party securities on deposit (excluding portfolio management): other 1. securities issued by companies included in consolidation 398,126 2. other securities 15,496,528 c) Third-party securities deposited with others 15,715,792 c) Owned securities deposited with others 734,691 4. Other transactions -

118 • Notes to the Consolidated Financial Statements - Part B FINANCIAL YEAR 2010 Part C - INFORMATION ON THE CONSOLIDATED INCOME STATEMENT

Section 1 - Interest - Items 10 and 20

1.1 Interest income and similar items: breakdown

Items/Types Debt securities Loans Other Total Total transactions 2010 2009 1. Financial assets held for trading 10,703 - - 10,703 11,419

2. Financial assets designated at fair value - - - - - ts - Part C n 3. Financial assets available for sale 8,167 - - 8,167 9,686 4. Financial assets held to maturity 188 - - 188 262 5. Loans to banks 2,482 1,704 315 4,501 8,514 6. Loans to customers 317 36,564 335 37,216 46,115

7. Hedging derivatives x x - - - tateme S 8. Other assets x x 2 2 - Total 21,857 38,268 652 60,777 75,996 ial

The component deemed to be a non-recoverable portion of interest income on non-performing assets was adjusted and included under Item 130 “Write-downs due to impairment.” nc a n

1.2 Interest income and similar items: hedging transaction differentials

This item is not applicable to the Banca Intermobiliare Group.

1.3 Interest income and similar items: additional information solidated Fi

1.3.1 Interest income on financial assets in foreign currency n

Items/Amounts 2010 2009 Interest income on financial assets in foreign currency 778 655

1.3.2 Interest income on finance leasing transactions

This item is not applicable to the Banca Intermobiliare Group. Notes to the Co

Notes to the Consolidated Financial Statements - Part C • 119 FINANCIAL YEAR 2010

1.4 Interest expense and similar items: breakdown

Items/Types Payables Securities Other Total Total transactions 2010 2009 1. Due to central banks 24 x - 24 495 2. Due to banks 5,411 - 981 6,392 6,916 3. Due to clients 10,217 x - 10,217 22,801 4. Outstanding securities - 13,183 - 13,183 15,175 5. Financial liabilities held for trading - 27 2,316 2,343 2,351 6. Financial liabilities designated at fair value - - - - - ts - Part C 7. Other liabilities and provisions x x 2 2 18 n 8. Hedging derivatives x x - - 124 Total 15,652 13,210 3,299 32,161 47,880

tateme 1.5 Interest expense and similar items: hedging transaction

S differentials

This item is not applicable to the Banca Intermobiliare Group. ial

nc 1.6 Interest expense and similar items: additional information a n 1.6.1 Interest expense on liabilities in foreign currency

Items 2010 2009 Interest expense on financial liabilities in foreign currency 3,427 1,227

1.6.2 Interest expense on liabilities for finance leasing transactions solidated Fi

n Items 2010 2009 Interest expense on liabilities for finance leasing transactions 225 424 Notes to the Co

120 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010

Section 2 - Commissions and fees - Items 40 and 50

2.1 Fee and commission income: breakdown

Type of services/Amounts 2010 2009 a) guarantees issued 448 498 b) credit derivatives - - c) management, brokering, and consulting services: 1. trading of financial instruments 30,299 32,677

2. trading of foreign currencies 286 420 ts - Part C

3. portfolio management n 3.1. individual 23,754 24,310 3.2. collective 25,118 27,119 4. custody and administration of securities 1,134 1,550 5. custodian bank 1,201 1,191 tateme

6. placement of securities 4,933 2,687 S 7. order receipt and transmission 6,757 5,390

8. advisory services ial 8.1. relating to investments 2,293 948 nc

8.2. relating to financial structure 289 375 a

9. distribution of third-party services n 9.1. asset management portfolios 9.1.1. individual 2,106 1,338 9.1.2. collective 5,705 2,624 9.2. insurance products 7,127 5,117 9.3. other products 188 131 d) collection and payment services 513 536 e) securitisation servicing - - solidated Fi f) servicing for factoring transactions - - n g) tax collection services - - h) management of multilateral exchange systems - - i) current account maintenance and management 964 728 j) other services 714 387 Total 113,829 108,026 Notes to the Co

Notes to the Consolidated Financial Statements - Part C • 121 FINANCIAL YEAR 2010

2.2 Fee and commission expenses: breakdown

Services/Amounts 2010 2009 a) guarantees received - - b) credit derivatives - - c) management and brokering services - - 1. trading of financial instruments 5,087 5,546 2. trading of foreign currencies - - 3. portfolio management:

C 3.1 own portfolios - 8 3.2 delegated by third parties 18,227 16,492 4. custody and administration of securities 2,343 1,920

ARTE 5. placement of financial instruments 72 14 6. off-site proposals for financial instruments, products and services 12,786 8,358

- P d) collection and payment services 221 163 e) other services 1,335 824 Total 40,071 33,325

Section 3 - Dividends and similar income - Item 70 SOLIDATA N

O 3.1 Dividends and similar income: breakdown C

A Items/Income 2010 2009 V Dividends Income on UCI Dividends Income on UCI units units A. Financial assets held for trading 382 - 190 - RATI B) financial assets available for sale 2,547 - 1,090 - G C. Financial assets designated at fair value - - - - TE D. Equity investments - - N I

Total 2,929 - 1,280 - OTA N

122 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010

Section 4 - Gains and losses on assets held for trading - Item 80

4.1 Gains and losses on assets held for trading: breakdown

2010 Transactions/Income components Capital Trading Capital Trading Net profit gains profits losses losses (loss) 1. Financial assets held for trading 1.1 Debt securities 1,216 4,388 (2,123) (3,857) (376)

1.2 Equity securities 781 15,783 (1,253) (5,794) 9,517 ts - Part C 1.3 UCI units 180 57 (1) - 236 n 1.4 Loans - - - - - 1.5 Other - 3,344 - (2,534) 810 2. Financial liabilities held for trading

2.1 Debt securities - - - - - tateme

2.1 Payables - - - - - S 2.2 Other 78 427 (967) (1,010) (1,472)

3. Other financial assets and liabilities: ial exchange differences x x x x (579) nc 4. Derivatives a

4.1 Financial derivatives: n - On debt securities and interest rates 312 6,196 (1,032) (1,739) 3,737 - On equity securities and stock indices 4,176 6,935 (1,416) (15,968) (6,273) - On currencies and gold x x x x 12,022 - Other - - - (3) (3) 4.2 Credit derivatives - - (1,515) - (1,515) Total x x x x 16,104 solidated Fi n Notes to the Co

Notes to the Consolidated Financial Statements - Part C • 123 FINANCIAL YEAR 2010

2009 Transactions/Income components Capital Trading Capital Trading Net gains profits losses losses profit (loss) 1. Financial assets held for trading 1.1 Debt securities 3,839 13,604 (2,087) (624) 14,730 1.2 Equity securities 1,729 4,741 (324) (6,741) (595) 1.3 UCI units 921 1 - - 922 1.4 Loans - - - - - 1.5 Other - 710 - (327) 383 2. Financial liabilities held for trading -

C 2.1 Debt securities - 2 - (4) (2) 2.1 Payables - - - - - 2.2 Other 143 563 (1,609) (472) (1,375) 3. Other financial assets and liabilities: ARTE exchange differences x x x x 347 4. Derivatives

- P 4.1 Financial derivatives: - On debt securities and interest rates 4,620 405 (18) (136) 4,871 - On equity securities and stock indices 1,567 14,627 (2,037) (19,612) (5,455) - On currencies and gold x x x x 5,898 - Other - 4 - (18) (14) 4.2 Credit derivatives 905 - (2,695) - (1,790) Total x x x x 17,918 SOLIDATA N O

C Section 5 - Gains and losses on hedging A

V operations - Item 90 5.1 Gains and losses on hedging operations: breakdown

RATI G Income components/Amounts Total 2010 Total 2009

TE A. Income on: N

I A.1. Fair value hedging derivatives - 4,088

A.2 Hedged financial assets (fair value) - - A.2 Hedged financial liabilities (fair value) - - OTA A.4 Financial derivatives to hedge cash flows - - N A.5 Assets and liabilities in foreign currency - - Total income on hedging operations (A) - 4,088 B. Costs related to: B.1. Fair value hedging derivatives - - B.2 Hedged financial assets (fair value) - (3,535) B.3 Hedged financial liabilities (fair value) - - B.4 Financial derivatives to hedge cash flows - - B.5 Assets and liabilities in foreign currency - - Total costs on hedging operations (B) - (3,535) C. Net profit (loss) on hedging operations (A - B) - 553

124 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010

Section 6 - Profit (loss) on disposal or repurchase - Item 100

6.1 Profit (loss) on disposal or repurchase: breakdown

Items/Income components Total 2010 Total 2009 Profits Losses Net profit Profits Losses Net profit (loss) (loss) Financial assets 1. Loans to banks 94 - 94 - - - 2. Loans to clients ------3. Financial assets available for sale ts - Part C n 3.1 Debt securities 1,972 (567) 1,405 7,248 (166) 7,082 3.2 Equity securities 6,460 (459) 6,001 23,968 - 23,968 3.3 UCI units 163 (196) (33) - (713) (713) 3.4 Loans ------

4. Financial assets held to maturity ------tateme S Total assets 8,689 (1,222) 7,467 31,216 (879) 30,337 Financial liabilities 1. Due to banks ------ial

2. Due to clients ------nc

3. Outstanding securities 427 (796) (369) 198 (538) (340) a n Total liabilities 427 (796) (369) 198 (538) (340)

The profit from the sale of loans and receivables to banks related to the repayment of debt securities recorded in the loans and receivables portfolio.

Section 8 - Net write-downs/write-backs for impairment - Item 130 solidated Fi

8.1 Net write-downs/write-backs for impairment of loans: n breakdown

Transactions/Income Write-downs (1) Write-backs (2) Total Total components 2010 2009 Specific Specific Portfolio (3)=(1)-(2) (3)=(1)-(2) Portfolio Write-offs Other ABAB A. Loans to banks - Loans ------Notes to the Co - Debt securities ------B. Loans to clients - Loans (1,214) (13,744) (228) 2,133 8,592 - 67 (4,394) (18,221) - Debt securities ------C. Total (1,214) (13,744) (228) 2,133 8,592 - 67 (4,394) (18,221) Legend: A = From interest B = Other write-backs

Notes to the Consolidated Financial Statements - Part C • 125 FINANCIAL YEAR 2010

8.2 Net write-downs for impairment of financial assets available for sale: breakdown

Transactions/Income Write-downs (1) Write-backs (2) Total Total components 2010 2009 (3)=(1)-(2) (3)=(1)-(2) Specific Specific Write-offs Other From interest Other

A. Debt securities ------B. Equity securities - (1,935) x x (1,935) (10,848) ts - Part C

n C. UCI units - - x - - - D. Loans to banks ------E. Loans to clients ------F. Total - (1,935) - - (1,935) (10,848)

Specific write-downs on equity securities were calculated on the basis of the impairment policy described in Part A “Accounting policies.” tateme Specifically, out of a total write-down of EUR 1,935,000, EUR 1,049,000 in write-downs was made in relation to two listed securities held by the S Parent Company. These securities were already subject to impairment in previous years as equity securities held by the subsidiary Banca Ipibi (EUR 885,000). ial nc 8.3 Net write-downs for impairment of financial assets held a to maturity: breakdown n

This item is not applicable to the Banca Intermobiliare Group.

8.4 Net write-downs for impairment of other financial transactions: breakdown

Transactions/Income Write-downs (1) Write-backs (2) Total Total

solidated Fi components 2010 2009 n Specific Specific Portfolio (3)= (3)= (1)-(2) (1)-(2) Portfolio Write-offs Other ABAB A. Guarantees provided - -- - 6 - 161 167 - B. Credit derivatives ------C. Commitments to disburse funds ------D. Other transactions - (216) - - - - - (216) - E. Total - (216) - - 6 - 161 (49) - Notes to the Co Legend: A = From interest B = Other write-backs

126 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010

Section 11 - Administrative expenses - Item 180

11.1 Personnel costs: breakdown

Type of cost/Amounts 2010 2009 1) Employed staff a) salaries and wages 39,221 39,078 b) social security costs 9,912 9,993 c) severance pay 23 23 d) pension expenses 196 201 ts - Part C n e) provision to employees' severance fund 2,414 2,362 f) provision to pension fund and similar obligations: - - - defined contribution - - - defined benefit - - g) contributions to supplementary external retirement benefit funds: - - tateme S - defined contribution 1,413 1,335 - defined benefit - - ial h) costs related to share-based payments 543 689

i) other employee benefits 1,873 1,123 nc

2) Other working staff 2,244 2,095 a n 3) Directors and statutory auditors 1,877 2,403 4) Retired staff - - Total 59,716 59,302

11.2 Average number of employees by category

31.12.09 Redundancy New hires Category 31.12.10 Average solidated Fi

changes n Employed staff a) executives 43 (3) - 1 41 42 b) managers 292 (15) 10 22 309 301 c) remaining employed staff 320 (26) 53 (23) 324 322 Total employed staff 655 (44) 63 - 674 665 Other staff 6 (4) 2 - 4 5

11.3 Company defined-benefit pension provisions: total costs Notes to the Co Not applicable.

11.4 Other employee benefits Not applicable.

Notes to the Consolidated Financial Statements - Part C • 127 FINANCIAL YEAR 2010

11.5 Other administrative expenses: breakdown

Type of expense/Sectors 2010 2009 - property rentals 3,740 3,576 - furniture and property maintenance expenses 1,640 974 - other property expenses 427 316 - postal and telephone expenses 2,004 1,703 - electricity, heating and water 804 569 - equipment and software leases 3,512 2,692

C - electronic calculations 4,159 4,001 - regular assistance and software rental 2,391 2,642 - advertising and entertainment 1,503 1,214

ARTE - legal and notary services 2,324 2,169 - miscellaneous advisory and other services 6,368 7,561

- P - subscriptions 430 329 - transportation 1,298 1,703 - credit information and searches 13 - - insurance 1,787 916 - surveillance and security 145 34 - cleaning expenses 695 547 SOLIDATA

N - charitable and other donations 95 79

O - printing and stationery 629 672

C - association and union dues 419 454 A - general expenses 604 432 V - other expenses 1,154 829 - indirect and other taxes 1,601 1,737

RATI Total 37,742 35,149 G

TE Section 12 - Net allocations to provisions for risks N I

and charges - Item 190

12.1 Net allocations to provisions for risks and charges: breakdown OTA N Type of cost/Amounts 2010 2009 Net allocations to provisions for risks and charges for: - legal disputes (3,197) (15,874) - personnel-related charges (40) - - other charges - 3,965 Total (3,237) (11,909)

128 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010

Section 13 - Net write-downs/write-backs on tangible fixed assets - Item 200

13.1 Net write-downs/write-backs on tangible fixed assets: breakdown

2010 2009 Assets/Income Depreciation (a) Net write- Write-backs Net profit Depreciation (a)Net write-downs Write-backs Net profit components downs for (c) (a+b+c) for impairment (c) (a+b+c) impairment (b) (b)

A. Tangible fixed ts - Part C assets n A.1 Owned - For operating use 3,067 - - 3,067 3,561 - - 3,561 - For investment ------

A.2 Held under tateme

finance leases S - For operating use 919 - - 919 714 - - 714

- For investment ------ial Total 3,986 - - 3,986 4,275 - - 4,275 nc a n

Section 14 - Net write-downs/write-backs on intangible fixed assets - Item 210

14.1 Net write-downs/write-backs on intangible fixed assets: breakdown solidated Fi n 2010 2009 Attività/Componenti Amortisation Net write- Write- Net profit Amortisation Net write- Write- Net profit reddituali (a) downs for backs (c) (a+b+c) (a) downs for backs (c) (loss) impairment (b) impairment (b) (a+b-c) A. Intangible fixed assets A.1 Owned - Generated internally by the company ------Other 4,252 - - 4,252 4,308 - - 4,308 A.2 Held under finance leases ------Notes to the Co Total 4,252 - - 4,252 4,308 - - 4,308

Notes to the Consolidated Financial Statements - Part C • 129 FINANCIAL YEAR 2010

Section 15 - Other operating income and expenses - Item 220

15.1 Other operating expenses: breakdown

Income components/Amounts 2010 2009 - Contingent liabilities not related to Group items 927 2,149 - Charges for thefts and robberies 14 - - Other miscellaneous expenses 879 508 Total 1,820 2,657 ts - Part C

n 15.2 Other operating income: breakdown

Income components/Amounts 2010 2009 - Contingent assets not related to Group items 1,004 1,113 - Property rental income 1,856 2,095 tateme - Reimbursements for stamp and substitute tax 301 - S - Recovery of legal and notary expenses 16 28 - Recovery of postal expenses 196 411 ial - Other income 844 495 nc - Insurance payouts 730 2,250 a Total 4,947 6,392 n solidated Fi n Notes to the Co

130 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010

Section 16 - Profit (loss) on equity investments: breakdown - Item 240

16.1 Profit (loss) on equity investments: breakdown

Income components/Sectors 2010 2009 1) Jointly-controlled companies A. Income 1. Revaluations - - 2. Profit on disposal - - ts - Part C

3. Write-backs - - n 4. Other income - - B. Expenses - 1. Write-downs - - 2. Write-downs for impairment - - tateme

3. Loss on disposal - - S 4. Other expenses - - Net profit (loss) - - ial 2) Companies subject to significant influence A. Income nc a

1. Revaluations - - n 2. Profit on disposal - - 3. Write-backs - - 4. Other income 27 345 B. Expenses 1. Write-downs - - 2. Write-downs for impairment - - 3. Loss on disposal - - solidated Fi 4. Other expenses - - n Net profit (loss) 27 345 Total 27 345 Notes to the Co

Notes to the Consolidated Financial Statements - Part C • 131 FINANCIAL YEAR 2010

Section 19 - Profit (loss) on disposal of investments - Item 270

19.1 Profit (loss) on disposal of investments: breakdown

Income components/Sectors 2010 2009 A. Properties - Profit on disposal 9 - - Loss on disposal (2) - C ts - Part C B) Other assets n - Profit on disposal 990 - - Loss on disposal (1) (3) ARTE Net profit (loss) 996 (3)

- P The EUR 990,000 of profits on disposal are related to the disposal of the controlling interest in Parioli tateme

S Sviluppo S.r.l., which had been acquired as part of a loan recovery transaction.

ial Section 20 - Income taxes for the year on ordinary activities - Item 290 nc SOLIDATA a N n 20.1 Income taxes for the year on ordinary activities: breakdown O

C Income components/Sectors 2010 2009 A

V 1. Current tax payable (-) (7,829) (5,799) 2. Changes in current tax payable for previous years (+/-) 54 (11) 3. Reduction in current taxes payable for the year (+) 21 3

RATI 4. Change in prepaid taxes (+/-) (1,734) 6,075 G 5. Change in deferred taxes (+/-) 1,173 4,613 solidated Fi TE

n 6. Accrued income tax for the year (-) (-1+/-2+3+/-4+/-5) (8,315) 4,880 N I

OTA N Notes to the Co

132 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010

20.2 Reconciliation between theoretical and actual reported tax burden

Income components/Sectors 2010 2009 Theoretical tax burden (11,115) (8,243) Tax exempt revenues: Dividends 2,681 316 Profit on disposal of equity investments ("Pex" regime) 1,117 1,753 Other tax exempt income 252 320 Loss under tax transparency regime (93) (83) ts - Part C Valuation of available-for-sale securities - 1,503 n Non-deductible costs Allocated shares and stock options - (172) Other non-deductible costs (1,513) (1,488) Valuation of available-for-sale securities (271) (997) Pro-rata IRES and IRAP interest expense (394) (629) tateme S Other Prepaid taxes for previous periods (57) (22) ial Prepaid taxes for available-for-sale valuation 52 94

Utilisation of past losses 223 227 nc a Intragroup adjustments 805 805 n Actual tax burden (8,315) (6,616)

Section 21 - Profit (loss) on disposal groups held for sale net of taxes - Item 310

21.1 Profit (loss) on disposal groups held for sale net of taxes:

breakdown solidated Fi n

Income components/Sectors 2010 2009 1. Income - - 2. Expenses - - 3. Net valuations of asset group and related liabilities - - 4. Capital gains (losses) - 1,592 5. Taxes and fees - (438) Profit (Loss) - 1,154

The comparison data at 31 December 2009 was due to the gain on the disposal of 36,249,974 ordinary shares of the equity investment in Ipi S.p.A. on 16 June 2009 through participation in a tender offer presented by Ipi Domani S.p.A. (a subsidiary of Mi.Mo.Se S.p.A.) at a unit price of Notes to the Co EUR 1.9.

Notes to the Consolidated Financial Statements - Part C • 133 FINANCIAL YEAR 2010

21.2 Detail of income tax on disposal groups of assets and liabilities held for sale

2010 2009 1. Current taxes (-) - (438) 2. Change in prepaid taxes (+/-) - - 3. Change in deferred taxes (-/+) - - 4. Income taxes for the year (-1+/-2+/-3) - 438 C Section 22 - Minority interests - Item 330

ARTE 2010 2009 Minority interests 1,224 1,404 - P

Section 23 - Other information

There is no additional information other than that provided in the sections above. SOLIDATA

N Section 24 - Earnings per share O C

A 24.1 Average number of diluted ordinary shares V 2010 2009 Attributable profit Weighted average euro Attributable Weighted average euro

RATI (thousands of €) of ordinary shares profit of ordinary shares

G (thousands of €)

TE Earnings per share

N Basic EPS 9,029 149,057 0.061 7,168 149,444 0.048 I Diluted EPS 9,029 168,847 0.053 7,168 169,234 0.042 OTA

N 24.2 Additional information Basic earnings per share is calculated as the ratio of the net profit (or loss) for the year attributable to ordinary shareholders in relation to the average number of outstanding ordinary shares. Diluted earnings per share is calculated as the ratio of the net profit (or loss) for the year attributable to ordinary shareholders in relation to the average number of outstanding ordinary shares taking into account the diluting effects of converting the bond into shares.

134 • Notes to the Consolidated Financial Statements - Part C FINANCIAL YEAR 2010 Part D - C ONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME BREAKDOWN OF CONSOLIDATED COMPREHENSIVE INCOME

Items Gross amount Income tax Net amount D 10. Profit (loss) for the year x x 9,029 Other income components 20. Financial assets available for sale: a) changes in fair value (5,840) 2,791 (3,049) b) transfer to income statement

- write-downs for impairment 1,050 - 1,050 ts - Part

- capital gains (losses) (5,119) - (5,119) n c) other changes - - - 30. Tangible fixed assets (135) - (135) 40. Intangible fixed assets - - - 50. Foreign investment hedges: tateme

a) changes in fair value - - - S b) transfer to income statement - - - c) other changes - - - ial 60. Cash flow hedges:

a) changes in fair value (92) - (92) nc b) transfer to income statement - - - a n c) other changes - - - 70. Exchange differences: a) changes in value 5,350 - 5,350 b) transfer to income statement - - - c) other changes - - - 80. Non-current assets held for sale: a) changes in fair value - - -

b) transfer to income statement - - - solidated Fi

c) other changes - - - n 90. Actuarial gains (losses) on defined benefit plans - - - 100. Valuation reserves from investments accounted using the equity method: - - - a) changes in fair value (271) - (271) b) transfer to income statement - write-downs for impairment - - - - capital gains (losses) - - - c) other changes - - - 110. Total other income components (5,057) 2,791 (2,266)

120. Comprehensive income (Item 10 + 110) 3,972 2,791 6,763 Notes to the Co 130. Minority interests in consolidated comprehensive income (1,929) 281 (1,648) 140. Parent Company's consolidated comprehensive income 5,901 2,510 8,411

Notes to the Consolidated Financial Statements - Part D • 135 FINANCIAL YEAR 2010 Part E - INFORMATION ON RISKS AND RELATED HEDGING POLICIES

In the following part E “Information on risks and relative hedging policies”, some tables provide information for the entire Banking Group given that the consolidated financial statements do not include insurance companies other than

E Bim Vita, which was consolidated using the equity method. In addition, the other companies which are not part of the Banking Group (Bim Immobiliare S.r.l., Immobiliare D S.r.l. e Bim Insurance Brokers S.p.A.) have balances for certain items on the financial statements - relating to credit, market and liquidity risks - that are close to zero or insignificant.

I nternal control system

ts - Part The internal control system of the Banca Intermobiliare Group is structured with different levels of control, including: n - Operational controls, which aim to ensure the appropriate fulfilment of operations; these therefore refer to controls of a hierarchical nature which are conducted by the productive organization itself and are generally incorporated into the procedures or implemented as back-office activities. - Risk Management controls - these activities aim to define methodologies for measuring risk, for verifying compliance with the limits assigned to the various operational departments and for monitoring the consistency of the operations tateme

S of individual production areas with risk/return objectives. Risk management controls are entrusted to non-productive departments. - Compliance - these controls aim to monitor risks associated with the failure to comply with external and internal ial regulations. nc - Internal Audit - these activities aim to identify anomalous trends or violations of procedures or of internal and a external regulations as well as assessing the overall functionality of the internal control system. These activities are n carried out by non-operational and independent departments. Level II control functions - such as Risk Management and Compliance - were, at 31/12/2010, under the responsibility of the Risk and Compliance Department, which reports directly to the CEO; level III control functions - Internal Audit and Investment Services Audit - are part of the Audit Department, which reports to the Board of Directors. Below is a summary of the tasks implemented by each department:

R isk Management This department ensures the integrated measurement and control of risks by monitoring and analyzing the overall risk solidated Fi

n exposure of the bank and of the Group companies, in accordance with the provisions of the Supervisory Authority and international best practices. In particular, the department supports the Bank and the Group in identifying, managing and controlling assumed risks and represents the organizational structure which has been delegated responsibility for determining the overall internal capital for ICAAP purposes. The responsibilities of the Risk Management Department are the following: • ICAAP Process; • Market Risk; • Credit and Counterparty Risk; • Operating Risk; • Other risks;

Notes to the Co • The pricing of financial instruments which are held companion the proprietary account and on behalf of third parties; • Monitoring of client operations in relation to listed derivatives and OTC instruments.

C ompliance & Anti-Money Laundering The “compliance department” is entrusted with verifying that the sectors which fall within its area of competence - as assigned by the Board of Directors - contain mechanisms able to ensure compliance with those regulations that affect

136 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

client relations activities. This department is an integral part of the internal control system and serves as an instrument to ensure an appropriate and prudent management of the Group with oversight over legal and image-related risks that could potentially affect its stability and compromise the trust relationship with clients. This Department typically implements its activities by: E - identifying risks of non-compliance; - defining procedures for monitoring and control; - auditing operations; - providing advisory to the corporate bodies; - training and giving awareness to the personnel. The offices of the Company Anti-Money Laundering Manager (CAM) for the parent company are centralized within the Compliance Department. This Department is also responsible for operations that are suspected of market abuse. ts - Part n

A uditing Department The Auditing Department represents the focal point of level III Controls and is subdivided into two sub-departments - Internal Audit and Investment Services Audit - on the basis of professional specializations and types of process. tateme

I nternal Audit S The goal of the activities of this department is to determine whether the risk management process as well as the control

and governance system - as structured by company management - are adequate and functional for ensuring that: ial - risks are identified and managed in an appropriate manner; - there is sufficient interaction between the various governance divisions; nc a - financial, managerial and operational reporting is accurate, precise and timely; n - company operations are conducted in compliance with internal and external regulations; - company assets are managed in an efficient manner and adequately protected; - company programs, projects and objectives are realized; - the control process is subject to continuous qualitative improvements; - critical legislative or regulatory issues are promptly recognized and managed. The Internal Audit Department implements the following activities in compliance with the annual auditing/controls plan:

- targeted activities; solidated Fi

- recurrent activities; n - advisory support; - relations with internal governance bodies: Internal Control Committee, Board of Statutory Auditors, 231 Supervisory Body. This department monitors the activities implemented by the other control departments of the Bank and of subsidiaries; these activities are implemented by means of informational flows and with direct audits on companies of the Group or on individual processes of the latter, in accordance with the annual auditing plan. The Internal Control System - ICS - and the risk situation are periodically reported to the Internal Control Committee, which plays an active role by using the control departments of the Bank to define policies for the internal control system; this is undertaken in order for the primary risks related to the issuer and its subsidiaries to be correctly identified as well as adequately measured, managed and monitored, thereby also determining criteria for the compatibility of these Notes to the Co risks with an appropriate and correct management of the company. The Group, as of October 2008, was also equipped with a Supervisory Body pursuant to Legislative Decree no. 231/01; the latter is entrusted with the task of monitoring the adequacy and effective implementation/functioning of the Model, in addition to compliance with the latter and with the Code of Ethics by the corporate bodies, the employees and the collaborators of the companies of the Banca Intermobiliare Group.

Notes to the Consolidated Financial Statements - Part E • 137 FINANCIAL YEAR 2010

SECTION 1 - RISKS RELATING TO THE BANKING GROUP

1.1 - CREDIT RISK

E QUALITATIVE INFORMATION

1 General information The credit activity of the Banca Intermobiliare Group primarily targets private clients with which the Group maintains or intends to maintain relations for the supply of investment and/or asset management services. In accordance with the mission of the Group, credit activity plays a complementary role to the primary activity of ts - Part investment in financial instruments as well as management and structuring of client assets and fostering of long-term n client loyalty. With reference to policies on risk-taking, one of the guiding principles in the management and formulation of strategic choices is the effective and detailed oversight of the quality of the exposures. Each policy, therefore, aims to maintain an elevated quality for loans while keeping in mind the business objectives. tateme

S 2 Credit risk management policies

2.1 Organizational factors ial In accordance with the definition used in literature and within the system, credit risk refers to the possibility that nc an unexpected change in the creditworthiness of the debtor could cause a corresponding unexpected change in the a market value of its exposure with reference to the Banca Intermobiliare Group. n The organizational structure of the bank ensures an adequate process for monitoring and managing credit risk, following the logic which separates business and control departments. The Board of Directors is exclusively entrusted with functions and powers relative to the determination of policies that affect the general management of the company’s business operations. With reference to internal controls, the Board of Directors approves strategic guidelines as well as risk management policies in addition to the organizational structure of the bank. The system of delegation required by the internal policy approved by the Board of Directors is significant; this system assigns specific powers to certain company bodies and departments in relation to deliberations on credit lines. solidated Fi

n The management of the credit process occurs in two distinct phases: - the initial valuation phase; - during the course of the relationship with the counterparty. In order to increase the creditworthiness of the portfolio of loans, the Banca Intermobiliare Group deemed it opportune to concentrate all the phases related to the assumption and control of risk within the General Management Department of the bank, thereby obtaining - through the specialization of resources and the separation of duties at all decision levels - a high degree of homogeneity when granting credit lines and strong monitoring of the individual positions. The process for loan disbursement is regulated by a coded internal procedure which defines the roles of the company bodies and departments that are involved. With reference to and in compliance with the system of delegation

Notes to the Co required by the Board of Directors, specific responsibilities have been assigned for assessing and assuming risk. In particular, the branch offices of the bank have very limited deliberative autonomy in assuming credit risk and, in any case, the procedure for individual proposals is always implemented by the General Management. On the other hand, the branches are delegated the responsibility for regional business development, in addition to client relations management. Credit activities are centralized within the Financial Services Division, which includes:

138 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

- the Credit Analysis Department, which is entrusted with preliminary investigative activities as well as the assessment of creditworthiness of requesting clients; - the Credit Department, which is entrusted with all activities associated with erogating and managing decisions in relation to credit lines; - the Monitoring and Reporting Department, which is responsible for monitoring the quality of individual credit E lines as well as verifying, over time, any collateral used to secure the credit lines. It also oversees credit collection activities for anomalous and impaired positions. The Risk Management Department has been delegated the responsibility for implementing controls with reference to the market, the counterparties and the operational risks of the Group.

2.2 Management, measurement and control systems ts - Part

Systems for the management, measurement and control of credit risk are developed within an organizational n environment that involves the entire process cycle from the initial investigative phase to the periodical review and monitoring phases. During the initial investigative phase, the bank internally and externally investigates the client which will potentially receive credit and reaches a final decision by considering the overall information on the economic party; this tateme

information is the result of direct knowledge of the client and of the economic environment in which he operates. S The initial investigative activities relating to the operational process which will lead to disbursement and the periodic review are implemented in order to grant a suitable credit to each individual case, in accordance with both the ial autonomous repayment capacity of the party and the technical format of the credit line, plus any collateral guarantees.

Credit risk is managed with the aid of procedures and tools which allow a timely identification of positions that nc present particular anomalies. On the basis of evidence which suggests doubtful credit, the latter is classified a as monitored or restructured, impaired or bad debt. Credit controls are based on a series of activities which are n implemented with different periodic frequencies (daily, weekly, monthly, quarterly and annual), all of which are dedicated to the recording (automatic and manual) of indices which could report potential impairment in the quality of the authorised credit line: anomalous trends of the relationships, loss of value of accessory guarantees, negative returns from the System (risk headquarters, Cai, Cerved, etc.).

Anomalous trends of the relationships: - daily auditing activities in relation to overdrafts (overdrafts procedure of Cedacri), which are automatically solidated Fi

managed on the basis of the grid of powers of authorisation delegated by the Board of Directors to the various n departments within the company; - monthly control activities on unpaid outstanding loans; - quarterly reporting of positions reporting persistent overdrafts.

Loss of value of accessory guarantees: - weekly audit of the suitability of secured guarantees through the Simox application; - annual audit of the suitability of mortgage guarantees with the Ribes application, which audits the values of the surveys present in the database of the Bank;

Negative returns for the system: Notes to the Co - verification of the anomalies that are automatically detected with reference to return feeds from Bank of Italy; - verification of the client reports from Cai.

The Risk Management Department conducts trend analysis of asset requirements on a quarterly basis, by calculating credit and concentration risks and by verifying that these requirements are coherent with the ones reported in the

Notes to the Consolidated Financial Statements - Part E • 139 FINANCIAL YEAR 2010

preceding analysis periods. The department subsequently applies stress tests to the results and, on the basis of these results, implements an analysis of the capacity of the assets of the Group to absorb potential losses as well as on correct actions which could be implemented in order to reduce and preserve the assets.

E 2.3 Credit risk mitigation techniques In the development of the operational process which leads to the allocation of a credit line, the assessment of creditworthiness is, first of all, based on the effective capacity of the debtor to meet its obligations and his capacity to generate adequate financial flows (defined by the Supervisory Body as the “debt fulfilment” capacity of the debtor). In connection with the granting of credit lines, Banca Intermobiliare acquires suitable collateral guarantees on properties and pledges on financial instruments as well as personal guarantees (independent guarantee agreement).

ts - Part A prudential haircut is applied to the value of the secured guarantees; this deviation varies in relation to the type of n securities being pledged. Given the revolving nature of the acquired pledges, the suitability of the secured guarantees is monitored on a weekly basis by means of the Simox procedure which allows a comparison between the current value of the guarantees and their historical values. The haircuts required by internal regulations are applied to the acquisition of mortgage guarantees; these are primarily differentiated on the basis of the type of property and the purposes for which the loan is requested. The tateme

S value of the expert survey is updated on an annual basis through the Ribes procedure. The guarantees received from the bank are drafted with contractual methods based on consistent sector standards and with the most recent legal developments. ial To mitigate credit risk, margining contracts are stipulated; their aim is to guarantee Bank exposure with clients in nc relation to OTC (Over The Counter) financial instruments. The monitoring of these positions is implemented by a the Risk Management Department. n ISDA contracts (International Swaps and Derivatives Association contracts, considered the market benchmark contract) are utilized to hedge against counterparty risk; these contracts allow the bank to benefit from a regulatory framework which guarantees against the potential netting/unwinding of positions with insolvent counterparties.

2.4 Impaired financial assets In Banca Intermobiliare, doubtful loans are managed by the Financial Services Division - for positions classified as persistent overdrafts, monitored, restructured and impaired - and by the Legal & Compliance Division with reference to other bad debts. solidated Fi

n The Monitoring & Reporting department: - proposes the revocation of credit lines for new positions in default; - supplies assistance and advisory services for the stipulation of payback and restructuring agreements in support of clients; - implements actions which aim to recover loans in default and to acquire additional guarantees; - estimates forecasted losses in an analytical manner for each individual client relationship.

The Legal Department: - followes the resolution by the competent body to re-classify a loan as a bad debt, manages the closure of accounts in the name of the client and implements the Bad Debt Procedure;

Notes to the Co - collaborates with the external law firm for credit collection and to analytically estimate expected losses for each client account; - proposes the potential re-classification to loss in case of a negative outcome of the credit collection and/or if the legal actions themselves are not economically feasible.

140 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

QUANTITATIVE INFORMATION

A. CREDIT QUALITY

A.1 Impaired and performing credit exposures: amounts, value E adjustments, trends, economic and geographical distribution.

A.1.1 Distribution of financial assets by portfolio and credit quality (book values)

Banking group Other companies Portfolio/quality Bad debts Watchlist Restructured Outstanding Other assets Impaired Other Total ts - Part loans exposures exposures n 1. Financial assets held for trading - - - - 392,268 - - 392,268 2. Financial assets available for sale - - - - 295,239 - - 295,239 3. Financial assets held until maturity - - - - 5,627 - - 5,627 4. Receivables due from banks - - - - 258,840 - 1,184 260,024

5. Receivables due from clients 130,544 25,920 2,784 18,561 1,676,997 - 444 1,855,250 tateme S 6. Financial assets valued at fair value ------7. Financial assets for disposal ------ial 8. Hedging derivatives ------

2010 Total 130,544 25,920 2,784 18,561 2,628,971 - 1,628 2,808,408 nc

2009 Total 138,461 106,760 1,541 79,691 2,642,873 - 818 2,970,144 a n

With reference to Ifrs principle 7§37, the following table shows the maturity of expired financial assets, entirely ascribable to the portfolio of the loans due from clients.

Portfolio/quality Expired exposures Total Up to From three to six From six months Over a year three months to up to a year

months solidated Fi

5. Due from clients 495 10,395 7,654 17 18,561 n

It should also be noted that, during the year, no credit exposure was subject to renegotiation as part of collective agreements. Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 141 FINANCIAL YEAR 2010

A.1.2 Distribution of credit exposures by portfolio of belonging and credit quality (gross and net values)

Portafogli/qualità Impaired assets Performing loans Total Gross Specific Net Gross Portfolio Net (Net exposure)

E exposure adjustments exposure exposure adjustments exposure A. Banking Group 1. Financial assets held for trading - - - x x 392,268 392,268 2. Financial assets available for sale - - - 295,239 - 295,239 295,239 3. Financial assets held until maturity - - - 5,627 - 5,627 5,627 4. Receivables due from banks - - - 258,840 - 258,840 258,840 ts - Part 5. Receivables due from clients 233,767 (55,958) 177,809 1,690,613 (13,616) 1,676,997 1,854,806 n 6. Financial assets valued at fair value - - - x x - - 7. Financial assets for disposal ------8. Hedging derivatives - - - x x - - Total (A) 233,767 (55,958) 177,809 2,250,319 (13,616) 2,628,971 2,806,780

tateme B. Other companies included within the scope

S of consolidation 1. Financial assets held for trading - - - x x - -

ial 2. Financial assets available for sale ------3. Financial assets held until maturity ------nc 4. Receivables due from banks - - - 1,184 - 1,184 1,184 a

n 5. Receivables due from clients - - - 444 - 444 444 6. Financial assets valued at fair value - - - x x - - 7. Financial assets for disposal ------8. Hedging derivatives - - - x x - - Total (B) - - - 1,628 - 1,628 1,628 Total 2010 233,767 (55,958) 177,809 2,251,947 (13,616) 2,630,599 2,808,408 Total 2009 394,186 (67,734) 326,452 2,272,133 (12,349) 2,643,691 2,970,143

solidated Fi A.1.3 Banking group - cash and off-balance sheet credit exposures with banks: gross and net values n

Type of exposure/value Gross exposure Specific value Portfolio value Net Exposure adjustments adjustments A. CASH EXPOSURES a) Bad debts - - x - b) Watchlist loans - - x - c) Restructured exposures - - x - d) Expired exposures - - x - e) Other assets 675,237 x - 675,237

Notes to the Co TOTAL A 675,237 - - 675,237 B. OFF-BALANCE SHEET EXPOSURES a) Impaired - - x - b) Other 77,467 x - 77,467 TOTAL B 77,467 - - 77,467 TOTAL A+B 752,704 - - 752,704

142 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

A.1.4 Banking group - cash credit exposures with banks: trends of gross impaired exposures

Not applicable.

A.1.5 Banking group - cash credit exposures with banks: trends of overall value adjustments E Not applicable.

A.1.6 Banking group - cash and off-balance sheet credit exposures with clients: gross and net values

Type of exposures/values Gross exposure Specific value Portfolio value Net Exposure adjustments adjustments ts - Part

A. CASH EXPOSURES n a) Bad debts 184,821 (54,277) x 130,544 b) Watchlist loans 26,947 (1,027) x 25,920 c) Restructured exposures 3,198 (414) x 2,784 d) Expired exposures 18,801 (240) x 18,561 e) Other assets 1,829,052 x (13,616) 1,815,436 tateme S TOTAL A 2,062,819 (55,958) (13,616) 1,993,245 B. OFF-BALANCE SHEET EXPOSURES ial a) Impaired 637 (6) x 631 b) Other 250,814 x (573) 250,241 nc a TOTAL B 251,451 (6) (573) 250,872 n TOTAL A+B 2,314,270 (55,964) (14,189) 2,244,117

A.1.7 Banking group - cash credit exposures with clients: trends of gross impaired exposures

Description/Categories Bad debts Watchlist loans Restructured Expired exposures exposures A. Gross initial exposure 203,490 108,319 1,989 80,379 - including: transferred but not cancelled exposures - - - -

B. Increases solidated Fi n B.1 Inflows from performing credit exposures 601 9,417 - 8,521 B.2 Transfers from other categories of impaired exposures 959 870 1,703 - B.3 Other increases 2,319 176 318 3,469 C. Decreases C.1 Outflows from performing credit exposures - (71,459) - (54,670) C.2 Cancellations (15,978) - - - C.3 Collections (6,570) (19,913) - (11,907) C.4 Capital gains from sales - - - - C.5 Transfers to other categories of impaired exposures - (463) (812) (6,991) C.6 Other decreases - - - - Notes to the Co D. Final gross exposure 184,821 26,947 3,198 18,801 - including: transferred but not cancelled exposures - - - -

Notes to the Consolidated Financial Statements - Part E • 143 FINANCIAL YEAR 2010

A.1.8 Banking group - cash credit exposures with clients: trends of overall value adjustments

Description/Categories Bad debts Watchlist loans Restructured Expired exposures exposures

E A. Overall initial adjustments 65,028 1,560 448 695 - including: transferred but not cancelled exposures - - - - B. Increases B.1. Value adjustments 11,768 455 - 1 B.2 Transfers from other categories of impaired exposures 842 96 51 - B.3 Other increases 20 - 9 146 ts - Part C. Decreases n C.1. Write-backs for valuation (7,643) (30) (78) (6) C.2. Write-backs for collection (892) (910) - (542) C.3. Cancellations (14,847) - - - C.5 Transfers to other categories of impaired exposures - (144) (16) (54) tateme C.6 Other decreases - - - - S D. Overall final adjustments 54,277 1,027 414 240 - including: transferred but not cancelled exposures - - - - ial nc a n solidated Fi n Notes to the Co

144 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

A.2 Classification of exposures on the basis of external and internal ratings

Banca Intermobiliare, for the purposes of determining the Internal Capital for credit risk, uses the standardized methodology (line-by-line method) which is required for determining the supervisory requirements associated with E credit risk. The standardized methodology provides the subdivision of exposures into various classes (portfolios) on the basis of the nature of the counterparty, the technical characteristics of the relationship or the methods of implementation of the latter; in addition, diversified weighting coefficients are applied to each portfolio. With reference to this aspect, the bank uses the creditworthiness assessments issued by the specialized rating agency, Moody’s, in order to determine weighting factors for exposures included in the following portfolios:

• Exposures with reference to central administrations and central banks: Rating characteristics - unsolicited; ts - Part

• Exposures with reference to international organizations: Rating characteristics - unsolicited; n • Exposures with reference to multilateral development banks: Rating characteristics - unsolicited; • Exposures with reference to companies and other parties: Rating characteristics - unsolicited; • Exposures with reference to undertakings for collective investments: Rating characteristics - solicited; • Positions with reference to securitizations that have a short-term rating; tateme

• Positions with reference to securitizations that do not have a short-term rating. S As for other exposures not included within the regulatory classes listed above, reference is made to the various weighting factors which are provided by the regulations themselves for the standardized methodology. ial

A.2.1 Banking group - cash and off-balance sheet credit exposures subdivided by external rating classes nc a n

Exposures External rating classes Not rated Total AAA/AA- A+/A- BBB+/BBB- BB+/BB- B+/B- Less than B- A. Cash exposures 318,611 150,143 111,311 3,457 - - 2,084,960 2,668,482 B. Derivatives B.1 Financial derivatives 786 - - - - - 111,494 112,280 B.2 Credit derivatives 34 - - - - - 740 774 C. Issued guarantees ------78,864 78,864 solidated Fi

D. Commitments to issue 20,000 - 1,000 - - - 16,643 37,643 n funds Total 339,431 150,143 112,311 3,457 - - 2,292,701 2,898,043

The Banca Intermobiliare Group applies the assessments of the rating agency Moody’s to all portfolios subject to financial reporting.

A.2.2 Distribution of cash and off-balance sheet credit exposures subdivided by internal rating classes

Not applicable. Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 145 FINANCIAL YEAR 2010

A.3 Distribution of guaranteed credit exposures by type of guarantee

A.3.1 Banking group - guaranteed credit exposures with banks E

Not applicable.

A.3.2 Banking group - guaranteed credit exposures with clients ts - Part n Personal guarantees (2) Total

Collateral (1) Derivati su crediti Crediti di firma 2010 (1)+(2) Altri derivati

Banks Banks tateme Securities S properties C L N Real estate Value of net exposure Value Other parties Other parties central banks central banks Other collateral Governments and Governments and Other public entities public Other Other public entities public Other ial 1. Guaranteed cash credit nc exposures: a 1.1Fully guaranteed 1,483,440 844,032 316,035 70,311 ------9,904 240,810 1,481,092 n - of which impaired 168,680 148,892 14,116 3,830 ------1,800 168,638 1.2. Partially guaranteed 94,490 633 30,882 25,761 ------7,279 64,555 - of which impaired 5,786 633 1,138 3,053 ------4,824 2. Guaranteed “off-balance sheet” credit exposures: 2.1. Fully guaranteed 79,987 36,709 16,940 3,609 ------6 629 22,095 79,988 - of which impaired 631 2 ------629 - 631 2.2. Partially guaranteed 48,974 - 4,604 506 ------5,110 solidated Fi

n - of which impaired ------Notes to the Co

146 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

B. DISTRIBUTION AND CONCENTRATION OF CREDIT EXPOSURES

B.1 Banking group - Sectorial distribution of cash and off-balance sheet credit exposures with clients (book values) E

Non-financial Governments Other public entities Financial companies Insurance companies Other parties companies

Exposures/ ts - Part Net exposure Net exposure Net exposure Net exposure Net exposure Net exposure counterparties n

Specific value adjustments Specific value adjustments Specific value adjustments Specific value adjustments Specific value adjustments Specific value adjustments Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments tateme

A. Cash exposures S A.1 Bad debts ------2,070 (5,794) - --- 124,230 (32,299) - 4,244 (16,184) - A.2 Watchlist loans ------25 (33) - --- 16,284 (471) - 9,611 (523) - ial A.3 Restructured exposures ------2,580 (409) - 204 (5) -

A.4 Expired exposures ------13,882 (190) - 4,679 (50) - nc a A.5 Other exposures 70,310 - - 1,057 - - 308,240 - (349) --- 930,881 - (8,302) 505,392 - (4,963) n TOTAL (A) 70,310 - - 1,057 - - 310,335 (5,827) (349) - - - 1,087,857 (33,369) (8,302) 524,130 (16,762) (4,963) B. Off-balance sheet exposures - B.1 Bad debts ------B.2 Watchlist loans ------629 (6) - - -- B.3 Other impaired assets ------2 - - - -- B.4 Other exposures ------45,049 - (10) - - - 144,752 - (373) 60,440 - (190) TOTAL (B) ------45,049 - (10) --- 145,383 (6) (373) 60,440 - (190) solidated Fi

TOTAL (A+B) 2010 70,310 - - - - - 355,384 (5,827) (359) --- 1,233,240 (33,375) (8,675) 584,570 (16,762) (5,153) n TOTAL (A+B) 2009 125,116 - - - - - 342,199 (5,513) (100) 8,580 - - 1,102,641 (39,052) (8,044) 571,028 (24,073) (4,945) Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 147 FINANCIAL YEAR 2010

B.2 B anking group - Geographical distribution of cash and off-balance sheet credit exposures with clients (book values)

E Exposures/geographical ITALY OTHER AMERICAS ASIA REST areas EUROPEAN OF WORLD COUNTRIES adjustments adjustments adjustments adjustments adjustments Overall value Overall value Overall value Overall value Overall value Net exposure Net exposure Net exposure Net exposure Net exposure

ts - Part

n A. Cash exposures A.1 Bad debts 130,168 (49,057) 316 (4,979) 60 (241) - - - - A.2 Watchlist loans 25,920 (1,027) ------A.3 Restructured exposures 2,784 (414) ------A.4 Expired exposures 18,560 (240) ------tateme A.5 Other exposures 1,706,345 (13,545) 89,806 (36) 18,495 (23) 1,202 (10) 34 - S TOTAL 1,883,777 (64,283) 90,122 (5,015) 18,555 (264) 1,202 (10) 34 - B. Off-balance sheet ial exposures B.1 Bad debts ------nc

a B.2 Watchlist loans 629 (6) ------n B.3 Other impaired assets 2 ------B.4 Other exposures 222,371 (565) 24,072 (8) 3,796 - 2 - - - TOTAL 223,002 (571) 24,072 (8) 3,796 - 2 - - - TOTAL 2010 2,106,779 (64,854) 114,194 (5,023) 22,351 (264) 1,204 (10) 34 - TOTAL 2009 1,919,896 (69,737) 178,527 (4,323) 51,288 (96) 1,025 (9) 73 (7,559) solidated Fi n Notes to the Co

148 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

B.3 B anking group - Geographical distribution of cash and off-balance sheet credit exposures with banks (book values)

Exposures/geographical areas ITALY OTHER EUROPEAN AMERICAS ASIA REST OF WORLD

COUNTRIES E adjustments adjustments adjustments adjustments adjustments Overall value Overall value Overall value Overall value Net exposure Net exposure Net exposure Net exposure Net exposure Overall value

A. Cash exposures ts - Part

A.1 Bad debts ------n A.2 Watchlist loans ------A.3 Restructured exposures ------A.4 Expired exposures ------

A.5 Other exposures 509,415 - 148,357 - 17,413 - - - 52 - tateme

TOTAL 509,415 - 148,357 - 17,413 - - - 52 - S B. Off-balance sheet exposures

B.1 Bad debts ------ial B.2 Watchlist loans ------nc

B.3 Other impaired assets ------a

B.4 Other exposures 6,103 - 70,320 - 1,044 - - - - - n TOTAL 6,103 - 70,320 - 1,044 - - - - - TOTAL 2010 515,518 - 218,677 - 18,457 - - - 52 - TOTAL 2009 342,575 - 88,946 - 10,332 - - - - -

B.4 Significant exposures (in accordance with supervisory regulations) solidated Fi n Following the 6th update of Memorandum 263 “New provisions of prudential supervision for banks” dated 27 December 2010, the regulations pertaining to significant exposures were broadly revised by Directive 2009/111/ EC which amends directives 2006/48 and 2006/49. The previous EC regulation was characterized by a “minimum harmonization” approach which gave member states and national supervisory authorities broad margins of choice in both incorporating and correctly applying harmonized rules. The revision which was recently applied aims to create a high level of consistency between regulations and the supervisory practices at the EU level. This objective is attained by significantly reducing the level of discretion allowed for individual member states. In particular, the criteria for calculating and weighting risk positions are modified as a result of the elimination of

numerous pre-existing national areas of discretion. Notes to the Co The primary implication relates to the definition of significant exposure, which is defined as exposure totalling 10% or more of the regulatory capital and without the application of the required weighting factors. Previous regulations, on the other hand, identified significant exposures as the risk position - or the weighted exposure according to the required rules - totalling 10% or more of the regulatory capital. As a result, the amount and number of significant exposures at 31 December 2010 increased significantly with respect to the value at 31 December 2009; however, this exclusively occurred as a result of a different regulatory framework.

Notes to the Consolidated Financial Statements - Part E • 149 FINANCIAL YEAR 2010

The information on significant exposures, as required by the notice of Bank of Italy, Protocol no. 0187292/11 dated 02.03.2011, is provided below with specifications of both book values as well as weighted values; in addition, a comparative value for 31.12.2009 is reported along with the new methodology. The consolidated significant exposures which were published in the annual report at 31.12.2009 (in accordance with the abovementioned regulations) E totalled six in number, for an overall total amount of 401,944 thousand Euro.

Total significant exposures in€ /thousand

2010 2009 nominal weighted nominal weighted ts - Part a) Total 1,046,930 515,182 1,057,699 536,095 n b) Number 15 15 14 14

Total significant exposures in€ /thousand by sector

2010 2009 tateme

S number nominal weighted number nominal weighted Impaired 1 116,326 116,326 2 195,898 195,898 ial Companies of the Group 3 203,623 91,269 1 53,358 42,603 nc Institutions 2 153,064 77 2 219,363 6,261 a

n Banks 1 67,097 24,777 2 153,352 29,756 Clients 8 506,820 282,733 7 435,728 261,577 Total 15 1,046,930 515,182 14 1,057,699 536,095

C. ASSET SECURITIZATION AND TRANSFER OPERATIONS

C.1 Securitization operations solidated Fi

n Not applicable. Notes to the Co

150 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

C.2 Transfer operations

C.2.1 banking group - Financial assets which were transferred but not cancelled

Category/Portfolio Financial assets held Financial Financial assets Financial assets held Loans to Banks Loans to clients Total E for trading assets available for sale until maturity valued at fair value A B C A B C A B C A B C A B C A B C 2010 2009 A. Cash assets 1.Debt securities 7,306 - - - - - 31,822 - - 2,653 - - 2,986 - - 2,287 - - 47,054 218,641

2.Capital securities ------xxx xxx xxx - - ts - Part n 3.C.I.U. ------xxx xxx xxx - - 4.Loans ------B.Derivative instruments ---xxx xxx xxx xxx xxx - - TOTAL 2010 7,306 - - - - - 31,822 - - 2,653 - - 2,986 - - 2,287 - - 47,054 n/a tateme

Of which impaired ------S TOTAL 2009 67,707 - - - - - 125,091 - - 39 - - 21,290 - - 4,514 - - n/a 218,641 Of which impaired ------ial

Legend: A = transferred financial assets that were fully recognised (book value) nc

B = transferred financial assets that were partially recognised (book value) a C = transferred financial assets that were partially recognised (full value) n

Financial assets which were transferred and not cancelled include securities used for repurchase agreements or securities lending.

C.2.2 banking group - Financial liabilities related to financial assets which were transferred but not cancelled

Liability/Asset portfolio Financial assets Financial assets Financial assets Financial Loans to Loans to Total 2010 held for trading valued at fair available for assets held to Banks clients solidated Fi n value sale maturity

1. Payables due to clients a) in connection with fully booked assets 22,824 - 25,720 2,669 4,988 2,325 58,526 b) in connection with partially booked assets ------2. Payables due to banks a) in connection with fully booked assets ------b) in connection with partially booked assets ------3. Outstanding securities

a) in connection with fully booked assets ------Notes to the Co b) in connection with partially booked assets ------TOTAL 2010 22,824 - 25,720 2,669 4,988 2,325 58,526 TOTAL 2009 76,959 - 125,257 40 21,103 4,597 227,956

Notes to the Consolidated Financial Statements - Part E • 151 FINANCIAL YEAR 2010

C.3 Banking group - covered bond transactions Not applicable.

E D. BANKING GROUP - MODELS FOR MEASURING CREDIT RISK Refer to the qualitative information on credit risk (2.2 Management, measurement and control system).

1.2 - BANKING GROUP - MARKET RISK General factors ts - Part The governance model of the Group is based on the centralized management of market risk. n The parent company Banca Intermobiliare: • defines the guidelines for an integrated management of risks at Group level; • is responsible for the market risk management policy. The governance model which regulates the process for managing and controlling Group risk is, in addition, based on

tateme the following principles:

S • separation between risk management and risk control processes; • development of risk management and control processes in accordance with the hierarchical structure of the Group

ial and the Bank through a process of delegation. The Board of Directors defines the general strategic direction and plays a managerial role in addition to creating nc policies and verifying the compliance of the risk governance structure at Group level; in particular, it defines market a

n risk propensity by identifying clear areas of responsibility and by establishing specific operational limits. The Chief Executive Officer implements the risk governance, management and control process by ensuring that the latter complies with the strategic guidelines defined by the Board of Directors. The Risk Committee - in relation to all the risks to which the bank is exposed - assesses and approves methodologies and procedures as appropriate, as well as methods for reporting to senior management, in accordance with the strategic guidelines of the Board of Directors. The committee also defines market risk management and control policies in accordance with the risk-return objectives set by the Board of Directors. The Risk Management department proposes the methodologies and processes that must be adopted at Group level

solidated Fi by formalizing the risk policies that must be presented for approval to the Board of Directors following validation by n the Risk Committee.

In particular, the Risk Management department - in relation to the management of market risk - is responsible for: • Ensuring consistency of internal regulations with the strategies expressed by the Board of Directors in relation to the assumption of risk; • Defining the market risk management model with the collaboration of the Financial Markets Division; • Proposing the structure of operating limits and supervisory thresholds at Bank and Group levels on the basis of the operations within the Financial Markets Division and market trends; • Monitoring daily operational limits (as resolved by the Board of Directors) as well as supervisory thresholds, in compliance with the frequency established by the Risk Committee; Notes to the Co • Verifying proposals for corrective action in relation to the management of cases where risk limits and supervisory thresholds are exceeded; • Identifying - in conjunction with the Financial Markets Division - the market risk contained in new financial products to be included within the portfolio; • Drafting reports to be sent to governance bodies and operational departments involved in the management of market risk, including evidence of any potential anomalies.

152 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

Pricing process The Risk Management department provides the determination of the fair value of all financial instruments, both securities and derivatives, in addition to their classification into three hierarchical fair value levels, as defined in the consolidated explanatory notes - Part A, “Accounting Policies” (to which reference is made); in particular, the fair value proposed by the various procedures for all financial instruments which are traded on an active market must be E validated while, in case of securities that are not traded on active markets, the fair value is determined by means of different valuation models, in accordance with the hierarchy established by the accounting principles. The pricing control implemented by risk management is not only carried out for the purposes of measuring the “fair value” of individual assets but it is also part of a broader policy of monitoring the risk/return ratio of these financial instruments. ts - Part

The fair value valuation criteria for financial instruments are illustrated below. n The Risk Management Department is entrusted with the task of verifying whether the security is traded on an active market or not; in order to classify a market as “active”, the following characteristics must apply: • Frequency of trades: the financial instrument must be traded at least once every five working days between each valuation date. tateme

• Significance of volumes: the degree of significance of the traded volumes is calculated by combining the S following elements: - Status of the issue: issue amount, presence of other issues of the issuer; ial - Issue amount held in the portfolio;

- Average volume of trades (if derivable on the basis of information from the counterparties); nc - Rating of the issue; a n - Rating of the issuer; - Rating of the country. A financial instrument is only considered traded on an active market if one of the following conditions exists: - It is traded on a regulated market with multilateral trading systems and systematic internalizers; - There are trading proposals from at least two contributors on the Bloomberg; the Bid/Ask spread must be less than 3% in case of investment grade bonds and 5% for junk bonds (unless the CBBT of Bloomberg is utilized). Instruments for which an active market has been recognized are valued using the following method: • Shares listed within a regulated market or MTF that is managed by Borsa Italiana: the reference price on the last solidated Fi

working day is taken into account; n • Shares listed within regulated markets other than Borsa Italiana S.p.A: the official price provided by the Cedacri provider is taken into account (TELEKURS price). • Bonds and Government Securities listed within a regulated market or MTF that is managed by Borsa Italiana or by MTS (Italian government bonds automated market): the official price of the last working day is taken into account; • Bonds listed on other MTF’s: the official price of the last working day is taken into account; • Bonds which are typically traded in regulated markets or MTF’s: the fair value will be determined by analyzing the contribution of info providers (typically Bloomberg); • Units of harmonized and non-harmonized CIU’s - index linked insurance policies - speculative funds subject

to Italian law - real estate funds: the fair value is considered as the value of the unit or the policy on the date of Notes to the Co closing of the financial statements - or on the most recent previous date -, published on the newspaper “Sole 24 Ore “ (or the last unit value made available by the management company). • Derivatives (futures and options) listed on Borsa Italiana S.p.A. or other regulated markets: the closing price is calculated on the basis of the criteria provided by the current regulations of the Markets Organized and Managed by Borsa Italiana S.p.A. or other trading markets, respectively.

Notes to the Consolidated Financial Statements - Part E • 153 FINANCIAL YEAR 2010

Where the Risk Management Department is not in a position to use Level 1 of the fair value, the various components of the financial instrument will be analyzed: if the variables are observable on the market, the instrument will be included within Level 2 of the hierarchy of fair value, otherwise estimates will be used and consequently Level 3 of fair value will be used. E The input parameters of the pricing models used by the Risk Management Department are considered observable if listed or if they can be derived from listed instruments. If this is not the case, the fair value valuation will always be based on the same models but the variables will be internally estimated by maintaining a highly prudent profile.

• Non-listed shares - The price is determined by the Research Department of the Investment Division using the market multiples

ts - Part method (estimate with EV/Ebitda and with EV/Sales) or with the Discounted Cash Flow method. The Risk n Management Department will proceed with the validation of the fair value obtained from the Research Department and the Level 3 classification. • Bonds - The fair value is determined on the basis of the valuation models made available by the Sophis program which implements pricing, position keeping and risk management activities. tateme

S • Derivative financial instruments - The fair value of all derivative financial instruments is determined on the basis of the valuation models made available by the Sophis program which implements pricing, position keeping and risk management activities. ial

nc The following table reports the primary valuation models which are made available by the Sophis program and a which are used for the valuations made by the Risk Management Department. n

SOPHIS IMPLIED MODELS Instruments Models Plain vanilla options Black & Scholes / Cliquet model/ COX model Cap & Floor Black & Scholes Option with pay-off not continuous Interpolated COX model Exotic options Trinomial model / Black & Scholes solidated Fi Digital options Trinomial model / Black & Scholes n Cliquet options Black & Scholes Barrier options (European) Trinomial model / Black & Scholes / Fourier model Barrier options (American) Trinomial model / Fourier model American/Bermudan exercise Trinomial model Quanto options COX model / Black & Scholes Compo options COX model / Black & Scholes Callable Equity Swaps Binomial model Convertible bonds Binomial model Asian options Monte Carlo / Black & Scholes / Cliquet model

Notes to the Co Look-back options Monte Carlo Cliquet bonds Monte Carlo Two-underlying options Monte Carlo

Illustrated below is a brief description of the primary variables which are used in the application of the models specified above:

154 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

• Rate curve: the choice of the rate curve varies on the basis of the expiration date of the financial instrument, in particular: - For maturities in less than two months, the “monetary market” curve is used; - For maturities between 3 months and 1 year and 2 months the curve for futures on deposits is used; - For maturities greater than one year and two months, the swap curve is used. E • Spot prices: directly supplied by the provider Bloomberg. • Dividends and related “potential payment dates”: dividends which were previously paid or announced are supplied by the provider Bloomberg, while analyses will be implemented for potential payment dates on the basis of historical distributability data with projections correlated to annual profitability. • Volatility: in the presence of listed options, the implicit volatility will be inserted for the underlying assets,

otherwise volatility will be directly defined by the Sophis program through an analysis of historical prices. ts - Part • Spot exchange: directly supplied by the provider Bloomberg. n

Trading book and banking book In relation to the integrated management of risk capital of Banca Intermobiliare, specific relevance is assigned to the presence of market risks to which the Trading book and the Banking book are exposed. tateme S The management and quantification of market risks is based on a daily analysis of the sensitivity and vulnerability of the trading books to adverse market trends in relation to the following risk factors: ial • Exchange rates

• Interest rates nc • Volatility a n • Stocks and indices • Credit spreads • Dividend derivatives • Correlation instruments

In particular, the analysis is structured on three levels which differ in terms of purposes and methodology: 1. Monitoring of operational limits deliberated by the Board of Directors 2. Value at Risk solidated Fi

3. Stress testing and scenario analysis n

For each type of trading activity, the operating limits for assumption of risk - both quantitative and qualitative - are defined and compliance with these limits is constantly monitored by the Risk Management department. In particular, the limits defined by the Board of Directors are based on: • Value at Risk limits • Portfolio duration, exposure to rate risk, creditworthiness of the issuer, exposure to credit risk and maximum exposure in relation to the trading bond portfolio • Maximum exposure, delta position, vega position, correlation for the operations on stocks and on financial derivatives

• Concentration limits Notes to the Co

Value at Risk The calculation of Value at Risk, for managerial purposes, is implemented at the end of each day; the adopted approach is that of historical simulation with a 99% confidence interval and a time period of 10 days. This type of approach was chosen for three primary reasons:

Notes to the Consolidated Financial Statements - Part E • 155 FINANCIAL YEAR 2010

1. no a priori assumptions are made with reference to the distribution of returns; 2. the correlation between risk factors is implicitly incorporated within the need for an ad hoc estimate; 3. the approach is appropriate for all types of linear and non-linear financial instruments. The historical simulation of VaR consists of a full revaluation methodology of all financial contracts on the basis of E historical scenarios of risk variables and assumes that the future distribution of returns of risk factors will be equal to the historical distribution of the latter.

Trading book - Value at Risk 99% 10 days (effect on net interest and other banking income) The specific data at 31 December 2010 was equal to €/thousand 2,884. In particular, the distribution of the VaR ts - Part amongst the various compartments is represented in the following table: n

(Values expressed in €/thousand) Overall VaR for trading book 2,884 VaR trading book - stocks/funds 2,500 tateme VaR trading book - bonds 940 S VaR trading book - exchanges 500

ial The average VaR in 2010 was equal to €/thousand 3,158. nc

a Banking book - Value at Risk 99% 10 days n (effects on shareholders’ equity) The specific data as of 31 December 2010 was equal to €/thousand 8,741. In particular, the distribution of the VaR amongst the various compartments is represented in the following table:

(Values expressed in €/thousand) Overall VaR for banking book 8,741 VaR banking book - stocks/funds 6,964

solidated Fi VaR banking book - bonds 3,043 n The average VaR in 2010 was equal to €/thousand 8,762.

The Var, defined for the purposes of obtaining a reasonable estimate of potential losses under normal market conditions, is not proposed and does not cover the analysis of extreme events. The use of stress testing and scenario analysis give the possibility to study, on the other hand, the impact of extreme conditions on the portfolio as well as the effect of violations of the assumptions of the model, thereby incorporating residual risks and providing information which is complementary to the VaR. The proprietary portfolio is periodically “stressed” in order to assess its “robustness” under extreme and decidedly adverse market conditions. Notes to the Co If the portfolio maintains its economic value in a satisfactory manner even after particularly adverse events (price crashes, increase of volatility, change in interest rates, etc..) then it is possible to define it as “robust”. Similarly, scenario analysis allows the subjective definition of a series of potential market conditions (favourable and adverse) in order to analyze the sensitivity of the economic value of the portfolio with reference to each of the scenarios.

156 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

1.2.1 INTEREST RATE RISK AND PRICE RISK - REGULATORY TRADING BOOK

QUALITATIVE INFORMATION

A. General information E

Interest rate risk The strategies underlying the investment policies of the trading portfolio exposed to interest rate risk are essentially the following: - medium/long-term position aimed at assuming directional risk (interest rate and credit risk) on high-quality

government securities; ts - Part

- medium/long-term position aimed at assuming directional risk (interest rate and credit risk) on corporate n securities issued by companies with ratings of at least BBB- or on bonds issued by Italian banks or by “high quality” countries; - arbitrage activities with the assumption of relative and non-directional risk through the hedging of interest rate or credit risk on any category of bond securities; tateme

- trading operations on high-quality government securities; S - trading operations on corporate securities issued by companies with ratings of less than BBB- and/or low quality government securities; ial With reference to the strategies summarized above, listed derivative instruments (futures on European and US government securities) are essentially used for partial hedging against interest rate risk and against potential nc exchange rate risk for assets that are not in Euro. a n

Price risk The strategies underlying the investment policies of the trading portfolio, which is exposed to price risk, are essentially the following: - Arbitrage operations on securities subject to tender offers, mergers (M&A), share capital increases implemented within the domestic market or in foreign markets; - Positions assumed through the acquisition/sale of Italian and foreign stock securities as well as of convertible bonds and the relative derivative instruments; solidated Fi n - Positions involving options on securities and stock indices; - Dividend transactions; - Volatile trading transactions.

Transactions involving financial instruments that are not part of the Euro area are generally covered by the risk of exchange rate fluctuations.

B. Management processes and measurement methods for interest rate risk

and price risk Notes to the Co

Interest rate risk As specified in the introduction to Section 2 related to “Market risks”, the management and quantification of interest rate risk is structured in three levels (operating limits deliberated by the Board of Directors, Value at Risk, Stress testing and scenario analysis) to which the Sensitivity Analysis is added.

Notes to the Consolidated Financial Statements - Part E • 157 FINANCIAL YEAR 2010

Price risk With reference to the first levels of analysis and monitoring of price risk (operating limits deliberated by the Board of Directors, Value at Risk, and Stress testing), the same considerations made in the introductory paragraph to Section 2, “Market risks” are applicable. E Sensitivity Analysis As a supplement to the Var, other risk indicators are calculated, particularly with regard to the strategies set for volatility trading (vega and delta position, volatility stress test) in order to make the identification and monitoring of risks more accurate and complete.

QUANTITATIVE INFORMATION ts - Part n 1. Regulatory trading book: Distribution by residual duration (re-pricing date) of financial assets and liabilities in cash and financial derivatives. This table has not been provided given that an interest rate sensitivity analysis is supplied on the basis of internal models or other methodologies, such as those illustrated in point 3. tateme

S 2. Regulatory trading book: Distribution of exposure in capital securities and stock indices within the primary countries of the listing market. ial This table has not been provided given that an interest rate sensitivity analysis is supplied on the basis of internal

nc models or other methodologies, such as those illustrated in point 3 a n 3. Regulatory trading book: internal models and other methodologies for sensitivity analysis

Interest rate risk The interest rate risk of the trading portfolio is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; it allows the measurement of the values of positions within proprietary portfolios following a “shock” to the interest rate curve. Parallel movements of 100 and 200 bp in the interest rate curve are taken into account. The effects on the earnings margin and the economic result were solidated Fi exclusively quantified for positions classified as HFT and whose mark to market changes are directly included in the n income statement.

Sensitivity analysis: trading book (Values expressed in €/thousand)

Risk Scenario Effects on earnings margin/ economic result Interest Rate Euro std + 100 bp -1,297 Interest Rate Euro std - 100 bp 1,433 Interest Rate Euro std + 200 bp -2,384 Notes to the Co Interest Rate Euro std - 200 bp 3,071

Price and volatility risk The price risk of the trading book is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; it allows the measurement of the values of stock positions within proprietary portfolios following changes in prices and volatility. The effects on the earnings margin and the economic result

158 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010 were exclusively quantified for positions classified as HFT and whose mark to market changes are directly portfolioed to the income statement.

Trading book (Values expressed in €/thousand) E

Risk Scenario Effects on earnings margin/ economic result Equity Equity -5% -226 Equity Equity +5% 226

Equity Equity -10% -453 ts - Part Equity Equity +10% 453 n Equity Equity -20% -906 Equity Equity +20% 906 Equity Equity -40% -1,813

Equity Equity +40% 1,813 tateme S

(Values expressed in €/thousand.) ial Risk Scenario Effects on earnings margin/ economic result nc a

Volatility Volatility +5% 61 n Volatility Volatility -5% -60 Volatility Volatility +10% 123 Volatility Volatility -10% -120

1.2.2 INTEREST RATE AND PRICE RISK - BANKING BOOK

QUALITATIVE INFORMATION solidated Fi

A. General information, management procedures and measurement methods for n interest rate risk and price risk

Interest rate risk The interest rate risk related to the banking book primarily derives from the activities implemented by the bank during the process of transforming maturities. In particular, the correlation between deposits and loans of clients as well as the net financial position in credit institutions is monitored. Loans granted to clients (for the purposes of developing trading activities in financial markets) are disbursed at variable rates and primarily have short term or on demand maturities. The adopted management choices are based on the measurement of the interest rate risk for the purposes of Notes to the Co minimizing the volatility of the interest margin or minimizing the volatility of the overall economic value when the structure of the interest rates is modified.

Price risk The price risk of the Banking book is represented by equity and hedge fund positions which are held for primarily strategic purposes.

Notes to the Consolidated Financial Statements - Part E • 159 FINANCIAL YEAR 2010

These are primarily positions of a directional nature and can be operationally classified under the finance division (investments in alternative funds, securities within the AFS portfolio); despite not having the pre-requisites required to be considered as part of the trading portfolio, they are managed by the division which implements trading activities and are monitored in terms of Value at risk and strategic shareholdings. E B. Fair value hedges Not applicable.

C. Cash flow hedges The hedging method used for interest rate risk is the cash flow hedge. The Banca Intermobiliare Group has

ts - Part implemented a single type of hedging activity in order to hedge against exposure to interest rate risk related to loans n disbursed with a variable rate. The hedge was implemented by utilizing Interest rate swap (IRS) derivative contracts in order to comply with the requirements of international accounting principles. The Risk Management Department is responsible for verifying the efficacy of the interest rate hedging for the purposes of hedge accounting. tateme S QUANTITATIVE INFORMATION ial 1. Trading book: Distribution by residual duration (re-pricing date)

nc of financial assets and liabilities. a n This table has not been provided given that an interest rate sensitivity analysis is supplied on the basis of internal models or other methodologies, such as those illustrated in point 2.

2. Banking book: internal models and other methodologies for sensitivity analysis

Interest rate risk The interest rate risk of the banking book is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; this allows the measurement of the values of positions within proprietary solidated Fi portfolios following a “shock” to the interest rate curve. Parallel movements of 100 and 200 bp in the interest rate n curve are taken into account. The effects on shareholders’ equity are valued for positions classified as AFS which affect assets unless significant or lasting impairment.

Sensitivity analysis: banking book (only debt securities of the AFS portfolio)

(Values expressed in €/thousand)

Risk Scenario Effects on earnings margin/ economic result Interest Rate Euro std + 100 bp -3,601 Notes to the Co Interest Rate Euro std - 100 bp 3,482 Interest Rate Euro std + 200 bp -7,015 Interest Rate Euro std - 200 bp 7,782

160 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

Sensitivity analysis: banking book (overall) (Values expressed in percentage points)

Risk index due to shift (+/-) + 200 bp -200 bp

Economic value at risk / Tier 1 4.83% 4.83% E Economic value at risk / Regulatory Capital 3.27% 3.27%

The sensitivity of the Bim Group presents a profile of exposure to interest rate risk due to an increase in interest rates. The economic value at risk is, in any case, fully compatible with both Tier 1 as well as with the Regulatory Capital and is significantly lower than the warning threshold defined by Basil II (20% with reference to the

Regulatory Capital for a shift in the interest rate curve of 200 bp). ts - Part n Price risk The price risk of the banking book is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; this allows the measurement of the values of positions within proprietary portfolios following changes in prices. The effects on shareholders’ equity are valued for positions classified as AFS

which affect assets unless significant or lasting impairment. tateme S BANKING BOOK

(Values expressed in €/thousand.) ial

Risk Scenario Effects on earnings margin/ nc economic result a n Equity Equity -5% -1,368 Equity Equity +5% 1,368 Equity Equity -10% -2,736 Equity Equity +10% 2,736 Equity Equity -20% -5,472 Equity Equity +20% 5,472 Equity Equity -40% -10,944

Equity Equity +40% 10,944 solidated Fi n

1.2.3 EXCHANGE RATE RISK

INFORMATION OF QUALITATIVE NATURE

A. General information, management processes and measurement methods for exchange rate risk The strategies underlying the investment policies of the trading book which is exposed to exchange rate risk are essentially the following: - Trading on foreign currencies in the short term through the use of spot contracts; - Trading on foreign currencies through purchase/sale of options and trading of forward contracts. Notes to the Co

Management processes and measurement methods for exchange rate risk 1. Operating limits deliberated by the Board of Directors 2. Value at risk 3. Sensitivity Analysis

Notes to the Consolidated Financial Statements - Part E • 161 FINANCIAL YEAR 2010

Operating limits deliberated by the Board of Directors Different operating limits have been deliberated for the two types of implemented activities: - With reference to short-term trading positions, a maximum asset limit in Euros as well as a stop loss is set; - With reference to medium to long-term trading positions, a vega limit was added in addition to the two previous E parameters.

Sensitivity Analysis With reference to a position on exchange rates, the quantification and monitoring of risk is implemented by analyzing the overall position in terms of maximum exposure as well as in terms of delta and vega positions (implicit volatility). Stress testing is then periodically implemented in terms of volatility and spot prices of the exchange rates. ts - Part n B. Exchange rate risk hedges Not applicable.

INFORMATION OF QUANTITATIVE NATURE tateme

S 1. Distribution of assets, liabilities and derivatives by currency of denomination

Items Currencies ial Canadian Other

nc USD Pounds Yen Dollars Swiss Francs currencies a A. Financial assets n A.1 Debt securities 30 - - - 1 - A.2 Equity securities 4,643 855 - - 1,368 5 A.3 Loans to banks 6,303 1,166 222 75 1,427 4,540 A.4 Loans to clients 17,886 1,145 2,580 13,370 18,467 3,011 A.5 Other financial assets -- - - 6 - B. Other assets -- - - - 800 C. Financial liabilities C.1 Payables due to banks (3) - (4,974) (412) (8,272) (41)

solidated Fi C.2 Payables due to clients (18,314) (1,728) (90) (383) (2,302) (3,427) n C.3 Debt securities (6,003) - - - (1,147) (6,609) C.4 Other financial liabilities ------D. Other liabilities ------E. Financial derivatives - Options + Long positions 1,927,451 14,064 18,838 2,836 76,633 310,346 + Short positions (1,927,287) (14,064) (18,838) (2,836) (76,633) (310,346) - Other + Long positions 338,573 1,463 18,154 2,290 49,945 22,293 + Short positions (324,242) (2,395) (15,683) (14,758) (48,079) (15,057)

Notes to the Co Total assets 2,294,886 18,693 39,794 18,571 147,847 340,995 Total liabilities (2,275,849) (18,187) (39,585) (18,389) (136,433) (335,480) Unbalance (+/-) 19,037 506 209 182 11,414 5,515

2. Internal models and other methodologies for sensitivity analysis The exchange rate risk of the trading portfolio is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; this allows the measurement of the values of positions within

162 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010 proprietary portfolios following a change in exchange rates and volatility of +/- 1%. The effects on the earnings margin and the economic result were exclusively quantified for positions classified as HFT and whose mark to market changes are directly booked to the income statement.

Sensitivity analysis: banking book E (Values expressed in €/thousand.) Risk Scenario Effects on earnings margin/ economic result Forex +1% exchange rates versus EURO 0 Forex -1% exchange rates versus EURO 0

Forex +1% forex volatility 0 ts - Part

Forex -1% forex volatility 0 n

1.2.4 DERIVATIVE INSTRUMENTS

A. FINANCIAL DERIVATIVES tateme S A.1 Regulatory trading book: average and period-ending notional values

Underlying assets/types of derivatives 2010 2009 ial

Over Central Over Central nc

the counter Counterparties the counter Counterparties a 1. Debt securities and interest rates n a) Options - - - - b) Swaps 408,637 - 424,776 - c) Forwards - 1,401 13 107 d) Futures - 3,137 - - e) Other - - - - 2. Equity securities and stock indices a) Options 173,919 109,037 72,804 16,729 solidated Fi b) Swaps - - - - n c) Forwards 8,240 5,248 - 376 d) Futures - - 6,450 - e) Other 7,477 - 402 - 3. Currencies and gold a) Options 9,242,694 - 5,694,311 - b) Swaps 36,217 - 4,234 - c) Forwards 528,970 - 250,958 - d) Futures - - - - e) Other - - - - Notes to the Co 4. Goods 7,034 - 629,175 - 5. Other underlying assets - - - - Total 10,413,188 118,823 7,083,123 17,212 Average values* n/a n/a n/a n/a

* Average values not available

Notes to the Consolidated Financial Statements - Part E • 163 FINANCIAL YEAR 2010

A.2 Banking book: average and period-ending notional values

A.2.1 For hedging

E As at 31.12.2010 , the Banca Intermobiliare Group had hedging derivatives relative to the banking portfolio which totalled a book value of €/thousand 148 and were composed of Interest rate swaps (IRS) in order to hedge against interest rate risk by means of cash flow hedges. In the previous year, only the negative fair value of an OTC forward, totalling €/thousand 94, was booked in the financial statements; this instrument was created in order to cover exchange rate risk on the Lse equity security which was booked under “Financial Assets available for sale”. ts - Part n Underlying assets/types of derivatives 2010 2009 Over Central Over Central the counter Counterparties the counter Counterparties 1. Debt securities and interest rates a) Options - - - - tateme

S b) Swaps 10,927 - - - c) Forwards - - - -

ial d) Futures - - - - e) Other - - - - nc

a 2. Equity securities and stock indices n a) Options - - - - b) Swaps - - - - c) Forwards - - 14,054 - d) Futures - - - - e) Other - - - - 3. Currencies and gold a) Options - - - - b) Swaps - - - - solidated Fi

n c) Forwards - - - - d) Futures - - - - e) Other - - - - 4. Goods - - - - 5. Other underlying assets - - - - Total 10,927 - 14,054 - Average values* n/a n/a n/a n/a

*Average values not available Notes to the Co

164 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

A.2.2 Other derivatives

Underlying assets/types of derivatives 2010 2009 Over Central Over Central the counter Counterparties the counter Counterparties E 1. Debt securities and interest rates a) Options - - - - b) Swaps - - - - c) Forwards - - - 2 d) Futures - - - - ts - Part

e) Other - - - - n 2. Equity securities and stock indices - - - a) Options - - - - b) Swaps - - - - c) Forwards - 10 - 3 tateme

d) Futures - - - - S e) Other - - - - 3. Currencies and gold - - - - ial a) Options - - - - nc b) Swaps - - - - a

c) Forwards - - - - n d) Futures - - - - e) Other - - - - 4. Goods - - - - 5. Other underlying assets - - - - Total - 10 - 5 Average values* n/a n/a n/a n/a solidated Fi *Average values not available n Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 165 FINANCIAL YEAR 2010

A.3 Financial derivatives: gross positive fair value - breakdown by product

Portfolios/types of derivatives Positive fair value 2010 2009 E Over Central Over Central the counter Counterparties the counter Counterparties A. Regulatory trading book a) Options 102,276 25,854 64,440 1,973 b) Interest rate swaps 2,388 - 6,738 - c) Cross currency swaps 1,745 - 12 - ts - Part

n d) Equity swaps - - - - e) Forwards 5,016 83 2,585 4 f) Futures - 11 572 - g) Other 1,218 - - - B. Banking book - for hedging tateme

S a) Options - - - - b) Interest rate swaps - - - -

ial c) Cross currency swaps - - - - d) Equity swaps - - - - nc e) Forwards - - - - a

n f) Futures - - - - g) Other - - - - C. Banking book - other derivatives a) Options - - - - b) Interest rate swaps - - - - c) Cross currency swaps - - - - d) Equity swaps - - - - e) Forwards - - - - solidated Fi

n f) Futures - - - - g) Other - - - - Total 112,643 25,948 74,347 1,977 Notes to the Co

166 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

A.4 Financial derivatives: gross negative fair value - breakdown by product

Portfolios/types of derivatives Negative fair value 2010 2009 E Over Central Over Central the counter Counterparties the counter Counterparties A. Regulatory trading book a) Options 105,015 24,792 65,256 226 b) Interest rate swaps 4,540 - 8,930 - c) Cross currency swaps 639 - 5 - ts - Part

d) Equity swaps - - - - n e) Forwards 4,101 65 2,896 4 f) Futures - 7 15 - g) Other 7 - 12 - B. Banking book - for hedging tateme

a) Options - - - - S b) Interest rate swaps 148 - - -

c) Cross currency swaps - - - - ial d) Equity swaps - - - - nc e) Forwards - - - - a

f) Futures - - - - n g) Other - - - - C. Banking book - other derivatives a) Options - - - - b) Interest rate swaps - - - - c) Cross currency swaps - - - - d) Equity swaps - - - - e) Forwards - - - - solidated Fi

f) Futures - - - - n g) Other - - - - Total 114,450 24,864 77,140 230 Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 167 FINANCIAL YEAR 2010

A.5 OTC financial derivatives: regulatory trading book - positive and negative gross notional & fair values by counterparty - contracts not falling under clearing agreements Contracts not falling under Governments Other Banks Financial Insurance Non-financial Other clearing agreements and central public companies companies companies parties

E banks entities 1. Debt securities and interest rates - notional value - - 300,380 68,179 - 27,405 - - positive fair value - - 955 862 - 461 - - negative fair value - - 3,574 816 - 111 - - future exposure - - 1,255 71 - 113 -

ts - Part 2. Equity securities and stock indices n - notional value - - 19,583 15,159 - 714 154,180 - positive fair value - - - 1,215 - 2 6 - negative fair value - - 1,993 7 - 1 635 - future exposure - - 180 425 - 43 11 3. Currencies and gold tateme

S - notional value - - 5,212,784 624,422 - 50,160 95,858 - positive fair value - - 42,360 11,950 - 573 1,833 - negative fair value - - 70,412 8,483 - 562 1,084 ial - future exposure - - 23,765 3,414 - 502 880 nc 4. Other valuables a - notional value - - 5,357 - - - 180 n - positive fair value - - 312 - - - 51 - negative fair value - - 367 - - - - - future exposure - - 18 - - - 2

A.6 OTC financial derivatives: regulatory trading book - positive and negative gross notional & fair values by counterparty - contracts falling under clearing agreements Contracts falling under clearing Governments Other Banks Financial Insurance Non-financial Other agreements and central public companies companies companies parties solidated Fi banks entities n 1. Debt securities and interest rates - notional value - - - - - 12,673 - - positive fair value - - - - - 110 - - negative fair value - - - - - 40 - 2. Equity securities and stock indices - notional value ------positive fair value ------negative fair value ------3. Currencies and gold - notional value - - - - - 3,824,656 - Notes to the Co - positive fair value - - - - - 51,948 - - negative fair value - - - - - 26,217 - 4. Other valuables - notional value - - - - - 1,497 - - positive fair value - - - - - 5 - - negative fair value ------

168 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

A.7 OTC financial derivatives: banking book - positive and negative gross notional & fair values by counterparty - contracts not falling under clearing agreements

Contracts not falling under Governments Other Banks Financial Insurance Non-financial Other

clearing agreements and central public companies companies companies parties E banks entities 1. Debt securities and interest rates - notional value - - 4,117 6,810 - - - - positive fair value ------negative fair value - - 22 126 - - - - future exposure - - - 29 - - - 2. Equity securities and stock indices ts - Part n - notional value ------positive fair value ------negative fair value ------future exposure ------3. Currencies and gold tateme

- notional value ------S - positive fair value ------negative fair value ------ial - future exposure ------

4. Other valuables nc

- notional value ------a n - positive fair value ------negative fair value ------future exposure ------

A.8 OTC financial derivatives: banking book - positive and negative gross notional & fair values by counterparty - contracts falling under clearing agreements

Not applicable. solidated Fi n Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 169 FINANCIAL YEAR 2010

A.9 Residual life of OTC financial derivatives: notional values

Underlying assets / Residual duration Up to one year Greater than Greater than Total one year and up five years to five years

E A. Regulatory trading book A.1 Financial derivatives on debt securities and interest rates 186,526 187,900 34,212 408,638 A.2 Financial derivatives on equity securities and stock indices 31,781 157,005 850 189,636 A.3 Financial derivatives on exchange rates and gold 9,690,391 117,490 - 9,807,881 A.4 Financial derivatives on other valuables 7,033 - - 7,033 B. Banking book - - - - ts - Part B.1 Financial derivatives on debt securities and interest rates - 10,927 - 10,927 n B.2 Financial derivatives on equity securities and stock indices - - - - B.3 Financial derivatives on exchange rates and gold - - - - B.4 Financial derivatives on other valuables - - - - 2010 Total 9,915,731 473,322 35,062 10,424,115 tateme 2009 Total 6,612,641 364,714 109,206 7,086,561 S A.10 OTC financial derivatives: counterparty risk/financial risk I- nternal Models ial The Banca Intermobiliare Group does not use internal models of the EPE type for the purposes of measuring

nc counterparty and financial risk; instead, the Group uses a method based on current values. a

n B. CREDIT DERIVATIVES

B.1 Credit derivatives: average and period-ending notional values

Transaction categories Regulatory trading book Banking book On a single party On multiple parties On a single party On multiple parties (basket) (basket) 1. Protection buyers a) Credit default products 73,945 7,500 - - solidated Fi

n b) Credit spread products - - - - c) Total rate of return swaps - - - - d) Other - - - - 2010 Total 73,945 7,500 - - Average values* n/d n/d n/d n/d 2009 Total 69,700 5,000 - - 2. Protective sales a) Credit default products 26,245 5,000 - - b) Credit spread products - - - - c) Total rate of return swaps - - - - Notes to the Co d) Other - - - - 2010 Total 26,245 5,000 - - Average values* n/d n/d n/d n/d 2009 Total 53,000 5,000 - - * Average values not available.

170 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

B.2 OTC Credit derivatives: gross positive fair value - breakdown by product

Books/types of derivatives Positive fair value 2010 2009 1. Regulatory trading book E a) Credit default products 813 657 b) Credit spread products - - c) Total rate of return swaps - - d) Other - - 2. Banking book - for hedging ts - Part a) Credit default products - - n b) Credit spread products - - c) Total rate of return swaps - - d) Other - - Total 813 657 tateme S ial B.3 OTC Credit derivatives: gross negative fair value - breakdown by product nc

Books/types of derivatives Negative fair value a n 2010 2009 1. Regulatory trading book a) Credit default products 1,526 1,364 b) Credit spread products - - c) Total rate of return swaps - - d) Other - - 2. Banking book - for hedging a) Credit default products - - solidated Fi n b) Credit spread products - - c) Total rate of return swaps - - d) Other - - Total 1,526 1,364 Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 171 FINANCIAL YEAR 2010

B.4 OTC credit derivatives: (positive and negative) gross fair values by counterparty - contracts not falling under clearing agreements

Contracts not falling under Governments Other Banks Financial Insurance Non-financial Other

E clearing agreements and central public companies companies companies parties banks entities Regulatory trading book 1. Protection buyers - notional value - - 51,500 7,700 - 2,245 - - positive fair value - - 209 - - 492 -

ts - Part - negative fair value - - 780 38 - - - n - future exposure - - 4,400 770 - 225 - 2. Protective sales - notional value - - 30,245 1,000 - - - - positive fair value - - - 73 - - -

tateme - negative fair value - - 708 - - - -

S - future exposure - - 2,025 100 - - - Banking book ial 1. Protection buyers - notional value ------nc

a - positive fair value ------n - negative fair value ------future exposure ------2. Protective sales - notional value ------positive fair value ------negative fair value ------future exposure ------solidated Fi n Notes to the Co

172 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

B.5 OTC credit derivatives: (positive and negative) gross fair values by counterparty - contracts falling under clearing agreements

Contracts falling under Governments Other Banks Financial Insurance Non-financial Other clearing agreements and central public companies companies companies parties E banks entities Regulatory trading book 1. Protection buyers - notional value - - - - - 20,000 - - positive fair value - - - - - 39 -

- negative fair value ------ts - Part

2. Protective sales n - notional value ------positive fair value ------negative fair value ------Banking book tateme

1. Protection buyers S - notional value ------

- positive fair value ------ial - negative fair value ------nc

2. Protective sales a

- notional value ------n - positive fair value ------negative fair value ------

B.6 Residual life of credit derivatives: notional values

Underlying assets / Residual duration Up to one year Greater than Greater than Total one year and five years

up to five solidated Fi

years n A. Regulatory trading book A.1 Derivatives on loans with qualified reference obligation 40,000 15,000 - 55,000 A.2 Derivatives on loans with non-qualified reference obligation - 57,690 - 57,690 B. Banking book - -- - B.1 Derivatives on loans with qualified reference obligation - -- - B.4 Derivatives on loans with non-qualified reference obligation - -- - 2010 Total 40,000 72,690 - 112,690 2009 Total 32,000 95,700 5,000 132,700 Notes to the Co B.7 Credit derivatives: counterparty risk/financial risk - Internal Models

The Banca Intermobiliare Group does not utilize internal models of the EPE type for the purposes of measuring counterparty and financial risk; instead, the Group uses a method based on current values.

Notes to the Consolidated Financial Statements - Part E • 173 FINANCIAL YEAR 2010

C. FINANCIAL AND CREDIT DERIVATIVES

C.1 OTC financial and credit derivatives: net fair values and future exposure for counterparties

E Governments Other Banks Financial Insurance Non-financial Other and central public companies companies companies parties banks entities 1) Bilateral agreement: financial derivatives - positive fair value ------negative fair value ------ts - Part

n - future exposure ------net counterparty risk ------2) Bilateral agreement: credit derivatives - positive fair value ------tateme - negative fair value ------S - future exposure ------net counterparty risk ------ial 3) "Cross product" agreements nc - positive fair value - -- - - 25,844 - a - negative fair value ------n - future exposure - -- - - 17,433 - - net counterparty risk ------solidated Fi n Notes to the Co

174 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

1.3 - BANKING GROUP - LIQUIDITY RISK

INFORMATION OF QUALITATIVE NATURE

A . General information, management processes and measurement methods for liquidity risk E Liquidity risk typically appears in the form of default with reference to an entity’s payment obligations, and may assume various forms depending on where this risk is generated. With reference to definitions that are shared at an international level, a distinction must be made between funding liquidity risk and market liquidity risk. Funding liquidity risk refers to the risk that the bank is not capable of effectively meeting its cash outflow obligations - both expected and unexpected, as well as current and future - as well as its collateral requirements without jeopardizing daily operations or the financial situation of the bank itself. ts - Part Market liquidity risk refers to the risk that the bank is not capable of liquidating a financial asset without generating n capital losses due to a low level of liquidity in the market of reference or to disorder in the latter.

The organizational and managerial framework is based on and provides: i) a Liquidity policy: by means of this policy, the net financial position of the bank is defined through specific models tateme

which measure short-term and medium to long-term liquidity (maturity ladder); the use of “scenario techniques” S is used by hypothesizing the occurrence of events which may modify certain items within the various brackets that constitute the maturity ladder; ial ii) a Contingency policy: defines the objectives, processes and intervention strategies which are applied in case of

situations of stress or crisis, thereby clarifying the organization model of reference and the pre-alarm indicators - nc and their relative trigger points - which identify the manifestation of these events. The Contingency Funding Plan a n is approved by the Board of Directors; it was prepared by defining the operating states of reference (for normal operations, stress conditions, crisis) and the operating instruments of reference (pre-alarm indicators, monitoring procedures, procedures for declaring states of stress and crisis, roles and responsibilities of affected organizational units).

In particular and with reference to stress testing scenarios, the latter are based on both events of systemic nature (Market Stress Scenarios) and specific nature (Bank Specific Stress Scenarios) in relation to the Group, while taking into account the macroeconomic scenario of reference, commercial policies and potential changes in behaviours of solidated Fi

customers. n

The Banca Intermobiliare Group has increased, during the course of the year, the total amount of assets assigned to the Collateralized Interbank Market which is becoming increasingly important in terms of volumes and number of adhering institutions. With reference to “overnight” loans, no stress phases were noted; however, the balance of securities assigned to overdraft was increased in order to guarantee a good level of liquidity even in less favourable circumstances. In the last quarter, an issue plan was initiated; this plan was primarily linked to the Eonia rate in order to compensate for the imminent redemption of the syndicated loan totalling circa €/million 245. Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 175 FINANCIAL YEAR 2010

QUALITATIVE INFORMATION

1 Temporal distribution by contractual residual duration of financial assets and liabilities

E Currency of denomination: Euro

Items/temporal brackets On demand From From From From From From From Greater Indefinite greater greater greater greater greater greater than greater than five duration than 1 than 7 than 15 than 1 than 3 6 month to 1 than 1 year years day to 7 days to 15 days to 1 month to 3 month to 6 year to 5 years days days month months months

ts - Part Cash assets n A.1 Government securities - 10 - - 2,504 12,512 4,735 49,119 1,887 A.2 Debt securities 115 - 1,492 12,482 44,850 44,993 63,334 280,997 103,843 A.3 Quotas of CIU’s 84 ------65,990 A.4 Loans ------Banks 135,999 6,973 2,988 57,651 35,419 7,431 2,004 - 9,727 10,590 tateme

S - Clients 1,056,803 - - 17,765 13,658 11,435 46,364 305,208 430,840 Cash liabilities

ial B.1 Deposits and bank accounts nc - Banks (102,010) - - (549) ------a - Clients (1,521,510) - - (497) (729) (697) (3,605) (5,676) - n B.2 Debt securities --- - - (19,835) (52,390) (304,629) (32,009) - B.3 Other liabilities (7,491) (36,169) (55,078) (117,451) (326,527) (9,800) (2,050) (81) (2,255) - “Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 35,616 24,241 48,253 246,779 126,631 85,349 643 183 - - Short positions - (42,287) (11,624) (52,716) (232,450) (125,201) (85,553) (25,787) (3,236) - solidated Fi C.2 Financial derivatives n without capital exchanges - Long positions 3,605 ------Short positions (6,471) ------C.3 Deposits and receivable loans - Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds ------Long positions 200 - - - - 20,000 4,311 33,923 22,787 -

Notes to the Co - Short positions (52,910) - - - - (20,000) - (9,000) -- C.5 Issued financial guarantees 457 132 - 2,978 2,621 2,188 11,607 36,810 9,260-

176 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

Currency of denomination: Usd

Items/temporal brackets On demand From From From From From From greater From Greater Indefinite greater greater greater greater greater than 6 greater than five duration than 1 than 7 than 15 than 1 than 3 month to 1 than 1 year years E day to 7 days to 15 days to 1 month to 3 month to 6 year to 5 years days days month months months Cash assets A.1 Government securities ------17 - A.2 Debt securities ------A.3 Quotas of CIU’s 76 ------

A.4 Loans ------ts - Part

- Banks 6,303 ------n - Clients 16,068 - - 1,370 - 278 - - 238 - Cash liabilities B.1 Deposits and bank accounts

- Banks (3) ------tateme

- Clients (16,792) ------S B.2 Debt securities ------(5,990) --

B.3 Other liabilities ------ial “Off-balance sheet” operations nc a C.1 Financial derivatives with n capital exchanges - Long positions - 138,651 134,900 124,573 767,963 516,107 516,950 8,258 -- - Short positions - (133,166) (135,554) (119,465) (771,446) (516,327) (516,950) - -- C.2 Financial derivatives without capital exchanges - Long positions 1,852 ------Short positions (2,314) ------C.3 Deposits and receivable loans solidated Fi

- Long positions ------n - Short positions ------C.4 Irrevocable commitments to issue funds - Long positions ------Short positions ------(2,245) -- C.5 Issued financial guarantees ------Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 177 FINANCIAL YEAR 2010

Currency of denomination: Gbp

Items/temporal brackets On demand From From From From From From greater From Greater Indefinite greater greater greater greater greater than 6 greater than five duration than 1 than 7 than 15 than 1 than 3 month to 1 than 1 year years E day to 7 days to 15 days to 1 month to 3 month to 6 year to 5 years days days month months months Cash assets A.1 Government securities ------A.2 Debt securities ------A.3 Quotas of CIU’s ------

ts - Part A.4 Loans -

n - Banks 1,166 ------Clients 1,150 ------Cash liabilities - B.1 Deposits and bank accounts -

tateme - Banks ------S - Clients (1,728) ------B.2 Debt securities ------

ial B.3 Other liabilities ------“Off-balance sheet” nc operations a C.1 Financial derivatives with n capital exchanges - Long positions - 44 - 290 12,465 116 - - -- - Short positions - (145) - (292) (13,294) (116) - - -- C.2 Financial derivatives without capital exchanges - Long positions 16 ------Short positions (7) ------C.3 Deposits and receivable solidated Fi loans - n - Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds - - - Long positions ------Short positions ------C.5 Issued financial guarantees ------Notes to the Co

178 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

Currency of denomination: Yen

Items/temporal brackets On demand From From From From From From greater From Greater Indefinite greater greater greater greater greater than 6 greater than five duration than 1 than 7 than 15 than 1 than 3 month to 1 than 1 year years E day to 7 days to 15 days to 1 month to 3 month to 6 year to 5 years days days month months months Cash assets A.1 Government securities ------A.2 Debt securities ------A.3 Quotas of CIU’s ------

A.4 Loans ------ts - Part

- Banks 230 ------n - Clients 1,211 - - 43 547 486 - - 315 - Cash liabilities B.1 Deposits and bank accounts

- Banks (50) - - - (4,924) - - - - - tateme

- Clients (90) ------S B.2 Debt securities ------

B.3 Other liabilities ------ial “Off-balance sheet” operations nc C.1 Financial derivatives with a capital exchanges n - Long positions - 49 2,577 3,091 16,086 14,265 1,117 - - - - Short positions - - (2,577) (4,561) (11,710) (14,749) (1,117) - - - C.2 Financial derivatives without capital exchanges - Long positions ------Short positions ------C.3 Deposits and receivable loans solidated Fi

- Long positions ------n - Short positions ------C.4 Irrevocable commitments to issue funds - Long positions ------Short positions ------C.5 Issued financial guarantees ------Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 179 FINANCIAL YEAR 2010

Currency of denomination: Cad

Items/temporal brackets On demand From From From From From From greater From Greater Indefinite greater greater greater greater greater than 6 greater than five duration than 1 than 7 than 15 than 1 than 3 month to 1 than 1 year years E day to 7 days to 15 days to 1 month to 3 month to 6 year to 5 years days days month months months Cash assets A.1 Government securities ------A.2 Debt securities ------A.3 Quotas of CIU’s ------

ts - Part A.4 Loans ------

n - Banks 76 ------Clients 3,433 - - - - - 9,972 - -- Cash liabilities B.1 Deposits and bank accounts

tateme - Banks (412) ------

S - Clients (384) ------B.2 Debt securities ------

ial B.3 Other liabilities ------“Off-balance sheet” nc operations a C.1 Financial derivatives with n capital exchanges - Long positions - 638 21 - 1,651 2,815 - - -- - Short positions - (8) (2,536) - (12,235) (2,815) - - -- C.2 Financial derivatives without capital exchanges - Long positions ------Short positions ------C.3 Deposits and receivable loans solidated Fi

n - Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds - Long positions - 638 ------Short positions - (638) ------C.5 Issued financial guarantees ------Notes to the Co

180 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

Currency of denomination: Chf

Items/temporal brackets On demand From From From From From From greater From Greater Indefinite greater greater greater greater greater than 6 greater than five duration than 1 than 7 than 15 than 1 than 3 month to 1 than 1 year years E day to 7 days to 15 days to 1 month to 3 month to 6 year to 5 years days days month months months Cash assets A.1 Government securities ------A.2 Debt securities ------A.3 Quotas of CIU’s ------

A.4 Loans ------ts - Part

- Banks 734 320 ------372 - n - Clients 6,715 - - - 1,285 7,849 1,988 - 773 - Cash liabilities B.1 Deposits and bank accounts

- Banks (8,272) ------tateme

- Clients (1,181) ------S B.2 Debt securities ------(1,143) --

B.3 Other liabilities ------ial “Off-balance sheet” operations nc C.1 Financial derivatives with a capital exchanges n - Long positions - 15,938 7 8,782 66,459 18,502 9,902 6,680 -- - Short positions - (15,989) (4,743) (8,783) (66,487) (18,502) (9,902) - -- C.2 Financial derivatives without capital exchanges - Long positions ------Short positions ------C.3 Deposits and receivable loans solidated Fi

- Long positions ------n - Short positions ------C.4 Irrevocable commitments to issue funds - Long positions ------1,449 - -- - Short positions ------C.5 Issued financial guarantees ------Notes to the Co

Notes to the Consolidated Financial Statements - Part E • 181 FINANCIAL YEAR 2010

Currency of denomination: Other

Items/temporal brackets On demand From From From From From From greater From Greater Indefinite greater greater greater greater greater than 6 greater than five duration than 1 than 7 than 15 than 1 than 3 month to 1 than 1 year years E day to 7 days to 15 days to 1 month to 3 month to 6 year to 5 years days days month months months Cash assets A.1 Government securities ------A.2 Debt securities ------A.3 Quotas of CIU’s ------ts - Part A.4 Loans ------n - Banks 4,532 ------Clients 487 ------2,525 Cash liabilities B.1 Deposits and bank accounts tateme

S - Banks (41) ------Clients (3,051) ------B.2 Debt securities ------(6,516) - ial B.3 Other liabilities ------nc “Off-balance sheet” a operations n C.1 Financial derivatives with capital exchanges - Long positions - 108 29,404 21,401 48,717 18,576 411 11,489 - - Short positions - (401) (34,203) (20,645) (48,717) (18,576) (151) (175) - C.2 Financial derivatives without capital exchanges ------Long positions 2,558 ------Short positions (2,063) ------solidated Fi C.3 Deposits and receivable n loans ------Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds ------Long positions ------Short positions ------C.5 Issued financial guarantees ------Notes to the Co

182 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010

1.4 - BANKING GROUP - OPERATIONAL RISKS

QUALITATIVE INORMATION

A. General information, management processes and measurement methods E for operational risk

Operational risk is defined as the risk of sustaining losses that derive from the inadequacy or dysfunctionality of procedures, human resources and internal systems or by exogenous events. This typology also includes losses caused by fraud, human error, interruptions in operations, unavailability of systems, contractual default or natural

catastrophes. It also includes legal risk. ts - Part

This definition, however, excludes strategic risk (losses sustained as a result of incorrect strategic assessments on the n part of management) and image risk (losses of market share, given that the image of the Group is associated with negative events). Three calculation methods for the capital requirement are provided; these are characterized by increasing levels of complexity in the measurement of exposure to risk and by stricter organizational oversight methods in terms of corporate governance mechanisms and processes for identifying, managing and controlling risk: BIA -Basic Indicator tateme S Approach, TSA -Traditional Standardised Approach), AMA - Advanced Measurement Approaches. With reference to the measurement of the prudential requirement, the Group uses - for regulatory purposes - the Basic Indicator Approach, BIA, which provides the application of a single regulatory coefficient (15%) to the indicator of company ial

operational volumes which is identified within the earnings margin. nc

For managerial purposes and in order to attain greater awareness in relation to the exposure to operational risk, the a parent company is currently implementing a recording and valuation process which aims to adopt TSA over time. n With reference to the management and implementation of the ORM process, the specific Operational Risk Management (ORM) department is active within the Risk Management department of the parent company. The ORM process can be primarily divided into three macrophases: Identification: Identification of operational loss events which could arise in relation to assets, businesses and responsibility centers. For this purpose, the Operational Risk Management department uses a specific organizational model which is based on an orderly and homogeneous segmentation of all company processes and within the corresponding centers of responsibility, in accordance to the business line map required by regulations pertaining to solidated Fi capital requirements. n Measurement: the analysis, by means of estimates and losses supplied by operational organizational structures, of negative economic effects which the Group may sustain. Management and mitigation: Identification of the areas in which risk exposure is particularly significant and the consequent definition - with the support of any affected operational organizational structures - of mitigation actions which can be implemented with greater priority and which must be presented to senior management for approval. The Business Continuity Plan is active within the Group. Its objective is to prepare organizational oversight systems and technological infrastructures which aim to reduce - within limits considered acceptable - any damages deriving from sensational events, thereby guaranteeing that the re-activation of critical processes and the coordination of activities until the restoration of full operations occurs in accordance with the established time periods and

modalities. Notes to the Co During the course of 2010, the Group Loss Data Collection activities continued and the 1999 Risk Self Assessment (SRA) was completed.

Notes to the Consolidated Financial Statements - Part E • 183 FINANCIAL YEAR 2010

INFORMATION OF QUANTITATIVE NATURE

The Operational Risk Management department implements the analysis of the loss data collection. This activity involves the search and registration of the so-called gross effective losses and provides the census of losses which are E equal to or greater than 500 Euro. These losses are classified by event type, risk factor and loss type. The primary sources for operational losses include the following types of events: “execution, delivery and management of processes” and “internal fraud”. As of 2009, a web based tool is fully operational and allows detailed statistical calculations to be implemented on historical data in addition to generating very detailed reports for upper management. ts - Part n SECTION 2 - RISKS OF INSURANCE COMPANIES

The Banca Intermobiliare Group retains a 50% shareholding in the insurance company Bim Vita S.p.A. - the other half being held by the Fondiaria-Sai Group - and consolidates its equal shareholding using the equity method. tateme S SECTION 3 - RISKS OF OTHER COMPANIES ial

nc See details at the beginning of part E, “Information on risks and relative hedging policies”. a n solidated Fi n Notes to the Co

184 • Notes to the Consolidated Financial Statements - Part E FINANCIAL YEAR 2010 Part F - INFORMATION ON CONSOLIDATED EQUITY

SECTION 1 - CONSOLIDATED EQUITY

A. QUALITATIVE INFORMATION

Equity management concerns the set of policies and decisions needed to define the size of equity and the optimal combination of various alternative equity instruments in order to ensure that the equity and the ratios of the Banca Intermobiliare Group are consistent with the risk profile adopted and comply with supervisory requirements.

The Group is subject to the capital adequacy requirements established by the Basel Committee in accordance to the ts - Part F rules defined by Bank of Italy. Based on these rules, the ratio of equity to weighted risk assets must be at least 8% at n the consolidated level. Compliance with these requirements is audited semi-annually by Bank of Italy. Compliance with capital adequacy is achieved using various methods such as pay out policies, the establishment of strategic finance transactions (capital increases, convertible bonds, subordinated bonds, etc.) and the management of lending policy as a function of counterparty risk. tateme

Throughout the year and on a quarterly basis, the bank’s and the Group’s compliance with adequacy ratios is S monitored. Additional analysis and precautionary checks of the Group’s capital adequacy are performed whenever extraordinary ial transactions are carried out. nc

In accordance with the guidelines provided by the Bank of Italy (Circular No. 263 of 27 December 2006 “New a Prudential Supervisory Provisions for Banks”), and with reference to the capital adequacy process (ICCAP), the n Banca Intermobiliare Group performed an independent assessment of its capital adequacy with the publication of the ICAAP Report for the consolidated financial statements as at 31 December 2009, which was approved by the Board of Directors on 23 April 2010. Reference should be made to the description in the introduction of Part E of the notes to the consolidated financial statements for 2009. solidated Fi n Notes to the Co

Notes to the Consolidated Financial Statements - Part F • 185 FINANCIAL YEAR 2010

B. QUANTITATIVE INFORMATION

B.1 Consolidated equity: breakdown by company type

Equity items Banking Insurance Other Consolidation eliminations Total Group companies companies and adjustments Share capital 212,208 - 278 (50,494) 161,992 Issue premiums 30 -- (30) - Reserves 242,026 - 4,015 (17,260) 228,779 Equity instruments 30,023 -- - 30,023 ts - Part F (Treasury shares) (34,416) -- - (34,416) n Valuation reserves: - Financial assets available for sale (5,705) -- 571 (5,134) - Tangible fixed assets ------Intangible fixed assets - -- - - tateme - Foreign investment hedges - -- - - S - Cash flow hedges - - (152) 60 (92) - Exchange differences - -- 5,915 5,915 ial - Non-current assets held for sale - -- - -

nc - Actuarial gains (losses) on defined benefit pension plans - -- - - a - Portion of valuation reserves related to investee n companies accounted for using the equity method - -- (3) (3) - Special revaluation laws 4,028 - 16,273 (6,268) 14,033 Group and minority interest in profit (loss) for the year (+/-) 15,982 - 533 (7,486) 9,029 Total 464,176 - 20,947 (74,993) 410,128

B.2 Valuation reserve for financial assets available for sale: breakdown

solidated Fi Assets/Amounts Banking Group Insurance Other companies Consolidation Total n companies eliminations and adjustments Positive Negative Positive Negative Positive Negative Positive Negative Positive Negative reserve reserve reserve reserve reserve reserve reserve reserve reserve reserve 1. Debt securities 165 (4,111) ------165 (4,111) 2. Equity securities 1,603 (2,346) - - - - 571 - 2,174 (2,346) 3. UCI units 1,258 (2,274) ------1,258 (2,274) 4. Loans ------Total 3,026 (8,731) - - - - 571 - 3,597 (8,731) Notes to the Co

186 • Notes to the Consolidated Financial Statements - Part F FINANCIAL YEAR 2010

B.3 Valuation reserve for financial assets available for sale: annual changes

Debt securities Equity securities UCI units Loans 1. Opening balance 965 2,934 (1,898) - 2. Increases - - - 2.1 Increases in fair value 1,523 1,041 1,683 - 2.2 Transfer of negative reserves to income statement - - - for impairment - 1,935 - - for a sale - - 32 - 2.3 Other changes 2,350 1,703 - - ts - Part F

3. Decreases n 3.1 Decreases in fair value (4,930) (3,449) (411) - 3.2 Write-downs for impairment (2,618) (421) - - 3.3 Transfer of positive reserves to income statement: for sale (1,236) (3,915) - - 3.4 Other changes - - (422) - tateme

4. Net closing balance (3,946) (172) (1,016) - S ial S Ection 2 - BANK EQUITY AND ADEQUACY RATIOS nc a

2.1 SCOPE OF APPLICATION OF THE REGULATIONS n

Supervisory capital was calculated on the basis of new provisions (Circular 263 of December 2006 updated in December 2010, and Circular 155/91 of February 2008) issued by Bank of Italy following new prudential regulations for banks and banking groups introduced by the New Basel Accord on Capital (Basel 2). The risks contributing to the calculation of ratios (credit and counterparty risk, market risk, operational risk and other requirements) were calculated taking into account the new provisions of Basel 2, and in accordance with the 12th update of Circular 155/91 of February 2008 which references Circular 263 of December 2006. solidated Fi

2.2 BANK SUPERVISORY CAPITAL n

A. QUALITATIVE INFORMATION

Supervisory capital is calculated as the sum of positive and, and with certain limitations (based on their capital quality), negative components. The positive components must be fully available to the Group in order to use them in the calculation of capital absorption levels. Supervisory capital is made up of tier I and tier II capital adjusted for certain deductions. In particular, equity interests (equity investments and shares in the trading portfolio) other items issued by such entities (innovative equity instruments, hybrid capital instruments and subordinated assets)and prudential filters, more thoroughly described below, are deducted. Fifty percent of equity interests and other items is Notes to the Co deducted from tier I capital, and 50% from tier II capital. The new provisions are aimed at harmonising criteria for determining supervisory capital and ratios with international accounting standards. In particular, they call for the prudential filters indicated by the Basel Committee for governing the criteria that are to be followed by domestic supervisory bodies in order to harmonise regulations with new financial statement criteria. Prudential filters, which are aimed at safeguarding the quality of supervisory capital and reducing its potential

Notes to the Consolidated Financial Statements - Part F • 187 FINANCIAL YEAR 2010

volatility, brought about by the application of new principles, consist of certain adjustments to accounting figures before their use for supervisory purposes. In particular, the new provisions specify that: - for financial assets held for trading, both unrealised gains and losses are entirely relevant; - for financial assets available for sale, unrealised gains and losses must be offset: if the balance is negative, it reduces tier I capital, and if positive, 50% is contributed to tier II capital. In addition, any unrealised profits and losses on loans classified as assets available for sale are eliminated; - for equity investments held in insurance companies, a 50% deduction must be made from tier I capital and a 50% deduction from tier II capital for stakes in companies acquired after 20 July 2006, while stakes acquired prior to 20 July 2006 are fully deducted from tier I and tier II capital. F In addition, following Bank of Italy Order of 18 May 2010 concerning new supervisory provisions with reference to capital for supervisory purposes and prudential filters, the Banca Intermobiliare Group took advantage of the option to fully neutralise capital gains and losses solely for securities issued by central governments of EU member countries ARTE included in the portfolio of “financial assets available for sale” instead of the asymmetric approach. Based on supervisory instructions, the equity of a credit group must be at least 8% of total weighted assets (total

- P capital ratio) with reference to the credit risk profile assessed on the basis of the borrower’s category, term, country risk and guarantees. Banks are also required to meet capital requirements connected with brokerage activities. These market risks are calculated on the entire trading portfolio broken down by various types of risk: position risk on debt and equity securities, settlement risk and concentration risk. With respect to the entire set of financial statements, it is also necessary to determine exchange risk and position risk on commodities. Internal models may be used to determine the capital requirement for market risks; the Banca SOLIDATA Intermobiliare Group uses the standard method. N O

C 1. Tier I capital

A Tier 1 capital includes paid in capital, issue premiums, profit reserves (including the reserve for the first application

V of IAS/IFRS which differs from those recognised among the valuation reserves), and minority interests, but net of treasury shares held in the portfolio, intangible assets and any losses reported in the current and previous years. It also includes any innovative or non-innovative capital instruments to be computed within the limits set by the RATI regulations. G The Banca Intermobiliare Group has no innovative or non-innovative capital instruments. Equity interests (equity TE investments and shares) and other items issued by such entities(innovative capital instruments, hybrid capital N

I instruments and subordinated assets), as well as 50% of investments in insurance companies acquired after 20 July

2006, are subtracted from tier I capital before elements to be deducted. The Banca Intermobiliare Group has registered shares in variable principal investment companies, 50% of which is OTA deducted from tier I capital and 50% from tier II capital. N

2. Tier II capital Tier II capital includes valuation reserves taking into account prudential filters, hybrid capital instruments and subordinated liabilities net of other negative elements. Subordinated liabilities may only be computed up to a limit of 50% of tier I capital before elements to be deducted. The tier II capital of the Banca Intermobiliare Group includes a subordinated bond in the form of a convertible bond issued in an amount initially equal to EUR 148,422,555. This amount was subject to supervisory amortisation starting in July 2010 for the amount of EUR 29,684,511, and a repurchase for the amount of EUR 1,408,500. The bond, which was fully included in tier II capital, now totals EUR 118,738,044. Since the repurchase amount was lower than the amount of supervisory amortisation, a further reduction of EUR 1,408,500 was not taken. Equity interests (equity investments and shares) and other items issued by such entities(innovative capital instruments, hybrid capital instruments and subordinated assets), as well as 50% of investments in insurance

188 • Notes to the Consolidated Financial Statements - Part F FINANCIAL YEAR 2010 companies acquired after 20 July 2006 are subtracted from tier II capital before elements to be deducted. The Banca Intermobiliare Group has registered shares in variable principal investment companies, 50% of which is deducted from tier I capital and from tier II capital.

3. Tier III capital The capital elements forming a part of tier III capital may be used only to cover capital requirements on market risk up to a limit of 71.4 percent of such requirements. At the end of 2009, the Banca Intermobiliare Group no longer had instruments that were includable in tier III capital for supervisory purposes since the subordinated bond was fully includable in tier II capital following the 1/5 supervisory amortisation. ts - Part F

B. QUANTITATIVE INFORMATION n

31.12.2010 31.12.2009 A. Tier I capital prior to application of prudential filters 276,248 264,248 B. Prudential filters of tier I capital: tateme

B.1 Positive IAS/IFRS prudential filters (+) - - S B.2 Negative IAS/IFRS prudential filters (-) 3,078 - C. Tier I capital inclusive of the elements to be deducted (A+B) 273,170 264,248 ial D. Deduction from Tier I capital 1,828 - E. Total tier I capital (C-D) 271,342 264,248 nc a

F. Tier II capital prior to application of prudential filters 138,761 149,274 n G. Prudential filters of tier II capital: G.1 Positive IAS/IFRS prudential filters (+) - - G.2 Negative IAS/IFRS prudential filters (-) 37 1,208 H. Tier II Capital inclusive of the elements to be deducted (F+G) 138,725 148,066 I. Deduction from Tier II capital 1,828 - L. Total tier II capital (H-I) 136,897 148,066 M. Deductions from tier I and II capital 5,950 5,996 solidated Fi N. Supervisory capital (E + L - M) 402,289 406,318 n O. Tier III capital - 11,578 P. Supervisory capital including tier III (N + O) 402,289 417,896

2.3 CAPITAL ADEQUACY

A. QUALITATIVE INFORMATION All minimum requirements for supervisory purposes were calculated in accordance with Circular 263, which, for such requirements, entered into force in March 2008. Notes to the Co These requirements include credit and counterparty risk, now joined under a single item; market risk; the new requirement for “operational risk,” meaning “the risk of incurring losses resulting from the inadequacy or failure of procedures, human resources and internal systems, or from exogenous events”; lastly, other requirements. Credit and counterparty risk was calculated using standardised methods, while operational risk was calculated using the base method.

Notes to the Consolidated Financial Statements - Part F • 189 FINANCIAL YEAR 2010

With regard to credit risk mitigation, the Banca Intermobiliare Group decided that, starting 31 December 2010, it would adopt the integral method rather than the simplified method. This methodology makes it possible to take more directly into account the effect of a reduction in credit risk brought about by a financial guarantee. The reduction in the capital requirement for credit and counterparty risk from the level at 31 December 2009 was due to the selection of this method. As indicated in the table on the breakdown of capital for supervisory purposes and risks, at 31 December 2010 the Group had a ratio of tier I capital to weighted risk assets of 11.29%, and a ratio of supervisory capital, including tier III capital, to weighted risk assets of 16.69%, which is higher than the minimum requirement of 8%. When making assumptions about the future development of the Group’s operations, there is constant monitoring of compliance with minimum mandatory capital requirements needed to support quantitative and qualitative growth in loans and,

ts - Part F more generally, risk assets. This is done by connecting this growth with the related income growth and verifying its n resulting ability to generate internal cash flow.

B. quantitative INFORMATION tateme

S Categories/Amounts Unweighted risks Required weighted amounts 31.12.2010 31.12.2009 31.12.2010 31.12.2009 A. RISK ASSETS ial A.1 Credit and counterparty risk

nc 1. Standardised methodology 3,315,250 3,562,438 1,970,388 2,165,225 a 2. Internal ratings method n 2.1 Basic - - - - 2.1 Advanced - - - - 3. Securitisations - - - - B. SUPERVISORY CAPITAL REQUIREMENTS B.1 Credit and counterparty risk 157,631 173,218 B.2 Market risk 1. Standard methodology 13,351 16,213 2. Internal models - - 3. Concentration risk - - solidated Fi

n B.3 Operational risk 1. Basic method 19,259 26,435 2. Standardised method - - 3. Advanced method - - B.4 Other minimum requirements - - B.5 Other calculation elements - - B.6 Total minimum requirements 189,301 214,204 C. RISK ASSETS AND CAPITAL RATIOS C.1 Weighted risk assets 2,366,257 2,677,548 C.2 Tier I capital/Weighted risk assets (Tier 1 capital ratio) 11.47% 9.87% C.3 Capital for supervisory purposes including Tier 3/Weighted risk

Notes to the Co assets (Total capital ratio) 17,00% 15,61%

190 • Notes to the Consolidated Financial Statements - Part F FINANCIAL YEAR 2010

S Ection 3 - INSURANCE EQUITY AND ADEQUACY RATIOS

Not applicable. d G n S Ection 4 - CAPITAL ADEQUACY OF FINANCIAL CONGLOMERATE

Not applicable. ts - Part F a

Part G - BUSINESS COMBINATIONS REGARDING n COMPANIES OR COMPANY DIVISIONS

During the year there were no business combinations regarding companies or company divisions. tateme S ial nc a n solidated Fi n Notes to the Co

Notes to the Consolidated Financial Statements - Part F and G • 191 FINANCIAL YEAR 2010 Part H - RELATED PARTY TRANSACTIONS

Notion of related party for the Banca Intermobiliare Group Based on the guidelines of IAS 24, the Banca Intermobiliare Group has identified individuals and legal entities H that are related parties taking into consideration the organisational structure and governance rules of the Parent Company and Group companies. Based on the Group’s specific characteristics, related parties were essentially deemed to be the same individuals and legal entities classified as such for the Parent Company, with the exception of subsidiaries, which are eliminated during consolidation, specifically: - the Parent Company’s holding company (Cofito S.p.A. and Veneto Banca) - affiliates: Bim itaV S.p.A. ts - Part - other related parties were included: n 1. management with strategic responsibilities and control bodies (directors, statutory auditors and executives responsible for managing the Parent Company and Group companies); 2. close family members of directors, statutory auditors and executives with strategic responsibilities in the Parent Company and Group companies as well as subsidiaries and associates of such entities. tateme

S Types of intra-group transactions Transactions between the Parent Company and other Group companies Banca Intermobiliare provides banking and investment services (opening current accounts, deposits and securities ial accounts, providing loans, and trading securities) to all companies in the banking group and to its holding company nc Cofito S.p.A. a Banca Intermobiliare, where the Group’s commercial network, consisting of 29 private banking branches, is based, is n also charged, on a non-exclusive basis, with promoting and/or marketing the financial services/products offered by: - Symphonia SGR S.p.A.; Symphonia Sicav and Symphonia Multisicav; - Bim Fiduciaria S.p.A. - Bim Vita S.p.A. - Bim Insurance Brokers S.p.A. - Immobiliare D S.r.l. The Parent Company, Banca Intermobiliare, was given a mandate to directly (through its commercial department) select entities interested in performing the marketing of individual and collective management products and services solidated Fi

n offered by Symphonia SGR, Symphonia Sicav and Symphonia Multisicav and to execute, as necessary, special marketing agreements for such products and services. Banca Intermobiliare also provides fully equipped workstations, and through its subsidiary Bim Immobiliare S.r.l., leases space to other Group companies. It also performs internal control functions on behalf of Symphonia SGR S.p.A., Symphonia Sicav and Symphonia Multisicav. Bim Fiduciaria provides outsourced accounting services for Symphonia Sgr S.p.A., Bim Immobiliare S.r.l. and Cofito S.p.A.

As part of the reorganisation of the Group’s management services, it should be noted that there are advisory agreements between the managed savings company and group banks covering the respective areas under their operational responsibility.

Notes to the Co The above transactions are carried out under market conditions. The income statement and balance sheet totals resulting from these transactions are eliminated based on accounting principles for consolidation. It should again be noted that Banca Intermobiliare: - together with its holding company, Cofito S.p.A. and the subsidiaries Symphonia SGR S.p.A., Bim Fiduciaria S.p.A., Bim Immobiliare S.r.l. and Immobiliare D S.p.A. renewed the option to participate in group taxation

192 • Notes to the Consolidated Financial Statements - Part H FINANCIAL YEAR 2010

(Article 117, paragraph 1 of the Consolidated Income Tax Act) for the three-year period from 2010-2012, indicating Cofito S.p.A. as the parent/holding company; - renewed the so-called “tax transparency” option (Article 115 of the Consolidated Income Tax Act) in relation to Bim Vita S.p.A. in which it holds a 50% interest.

All relationships connected with the exercise of the above options are set forth in specific agreements between the H parties involved.

Group governance in the performance of transactions with related parties Banca Intermobiliare and other Group companies carry out transactions that fall under banking and financial intermediation operations with other related parties, and specifically with directors and other individuals with

administrative, management and control duties, their close family members and with companies owned or ts - Part administered by them. n To be specific, the procedure specified in Article 136 of the Consolidated Banking Act is applied; it requires the prior unanimous resolution of the Board of Directors, the favourable vote of all members of the Board of Statutory Auditors and the abstention of the party concerned. Since, in all cases, the conditions applied do not differ from those applied to clients or market participants, the Group’s interest in completing the transactions is solely tied to taking advantage of economic opportunities. tateme S

The following table indicates existing relationships with related parties as at 31 December 2010. Relationships involving entities consolidated using the integral method are not indicated. ial nc

Quantitative operating information for 2010 and balance sheet figures as at 31 December 2010 a n

Related parties Assets Liabilities Expenses Income Guarantees Guarantees received given Parent company 30,519 49,756 3,173 1,757 - - Affiliates - 1,284 29 - - - Other related parties 2,660 9,972 467 405 - 3,330

Total 33,179 61,012 3,669 2,161 - 3,330 solidated Fi n

Quantitative operating information for 2009 and balance sheet figures as at 31 December 2009

Related parties Assets Liabilities Expenses Income Guarantees Guarantees received given Parent company 1,776 34,288 1,340 - - - Affiliates 101 - - 266 - - Other related parties 1,901 26,463 261 1,410 2,041 13,901 Total 3,778 60,751 1,601 1,676 2,041 13,901 Notes to the Co

Notes to the Consolidated Financial Statements - Part H • 193 FINANCIAL YEAR 2010

Compensation paid to directors, statutory auditors and executives with strategic responsibilities: quantitative information

The following table indicates the amount of compensation paid to directors, statutory auditors and executives with

H strategic responsibilities of the Parent Company and Group companies. Amounts are indicated in thousands of euros. The compensation paid to directors and statutory auditors is established by special shareholder resolutions. See Section H of the separate financial statements for the detailed table required by Consob Regulation No. 11971.

Directors Statutory auditors Executives with strategic responsibilities ts - Part

n Remuneration 1,551 242 1,249 Bonuses and incentives x x 439

Management and coordination activities tateme S Banca Intermobiliare is subject to the “management and coordination” of Veneto Banca following the merger of Cofito (the controlling shareholder of Banca Intermobiliare) stipulated on 18 February 2010 and recorded on the ial Treviso and Turin Company Registers on 25 February 2011. The information required pursuant to Article 2497-bis of

nc the Civil Code was provided in the separate financial statements for Banca Intermobiliare in Part H of the notes to

a financial statements, which should be referenced for further information. n Banca Intermobiliare and Veneto Banca Holding carry out transactions falling within the scope of banking and financial intermediation operations. Specifically, these transactions regard the area of mutual current accounts, lending and borrowing and securities trading. In addition, Veneto Banca markets the individual and collective management products and services offered by Symphonia SGR, Symphonia Sicav and Symphonia Multisicav. Furthermore, Banca Intermobiliare holds debt securities issued by Veneto Banca in its portfolio of securities held for trading. solidated Fi n Notes to the Co

194 • Notes to the Consolidated Financial Statements - Part H FINANCIAL YEAR 2010 Part I - SHARE-BASED PAYMENT AGREEMENTS

QUALITATIVE INFORMATION

1. Description of share-based payment agreements I

As at 31 December 2010, there were no longer any stock option plans of the Parent Company, but only stock granting plans which offer all employees the option to purchase Bim shares at nominal value with a three-year non- transfer restriction. The Banca Intermobiliare Group had previously provided staff incentives in the form of compensation plans based on the allocation of ordinary shares of Banca Intermobiliare in the form of stock options (free allocation of options ts - Part incorporating the right to purchase Bim shares at a specific price and within a pre-established time frame). n

QUANTITATIVE INFORMATION

1. Annual changes tateme S The table indicates stock option allocation figures using the format dictated by Appendix 3C of the Consob Issuers Regulation. This format also includes the information required by Bank of Italy in Circular No. 262/2005. ial nc

Items/Number 2010 2009 a n of options and exercise Number of Average prices Average Number of Average prices Average prices options maturity options maturity

A. Opening balance - - - 809,486 6.26 2009 B. Increases B.1 New issues 171,855 3.36 x 264,470 3.36 x B.2 Other changes - - x - - x C. Decreases solidated Fi C.1 Eliminations - - x - - x n C.2 Options exercised (171,855) 2.36 x (264,470) 2.36 x C.3 Options expired - - x (809,486) (6.26) x C.4 Other changes - - x - - x D. Net closing balance ------E. Exercisable options at the end of the year - - x - - x

2. Additional information

Expenses charged to the income statement in relation to share-based payment agreements for the 2010 financial Notes to the Co statements of Banca Intermobiliare totalled EUR 542,000 and were related to stock granting.

Notes to the Consolidated Financial Statements - Part I • 195 FINANCIAL YEAR 2010 Part L - operating SEGMENT

This section describes the consolidated results for the period reported by the operating segments into which the Group’s business is divided. Segments were identified in accordance with IFRS 8, which was used starting with the Half-Yearly Consolidated Financial Statements as at 30 June 2009 to replace the previous provisions on L segment reporting in IAS 14. Based on this new principle, the Banca Intermobiliare Group has identified the following operating segments: Client, Finance and Corporate Centre.

The Client Segment covers all typical transactions of private banking such as securities brokerage, management and consulting in the area of investment services and distribution of managed savings products (in the form of ts - Part individual and collective asset management portfolios), and ancillary activities such as lending and corporate n advisory services. The Client Segment includes the following companies/businesses: • the operations of the Parent Company, Banca Intermobiliare, limited to the provision of private banking services to clients, securities and derivatives brokerage, lending to clients and distribution of managed products;

tateme • the operations of Bim Suisse and Banca Ipibi, limited to the provision of services to clients;

S • the operations of the Group’s managed savings company, Symphonia SGR; • the operations of Bim Fiduciaria;

ial • the operations of Bim Insurance Broker. • the operations of Bim Insurance Broker. nc a The Finance Segment covers: n • trading and brokerage operations for OTC instruments and exchange rates carried out on the proprietary portfolio (with reference to all securities held in portfolios held for trading, HTM, AFS and L&R), the management of the treasury’s interbank operations and the management of rate and liquidity risk carried out by the Parent Company, Banca Intermobiliare; • the trading and treasury operations of Bim Suisse; • the treasury operations of Symphonia SGR, Bim Fiduciaria, Bim Insurance Broker and Banca Ipibi.

solidated Fi The Corporate Centre consists of the Parent Company’s General Management and the corporate bodies, in n addition to activities in support of the Group’s governance bodies (e.g., the Legal, Internal Audit and Risk Management Departments). Starting this year, in accordance with a new assignment of responsibilities in this area, operations involving the management of strategic equity investments (a part of the AFS securities portfolio) are no longer included, and are instead covered by the Finance Segment. The Corporate Centre retains responsibility for the imputed interest associated with the notional treasury unit. Lastly, this segment includes the operations of Bim Immobiliare and the real estate assets of Bim Suisse, Symphonia SGR and Immobiliare D S.r.l.

Breakdown by business segment: consolidated operating figures At a consolidated level, the contribution of the Group’s various segments to operating results in 2010 differed as Notes to the Co noted below. To summarise: • The Client Segment reported 47% growth y/y in interest margin due to the combined impact of growth in client loans and rates and the new method for calculating the transfer rate for in-house bond issues (which assigns a positive margin to the distribution channel). Net commissions were down slightly from the previous year (-5.5%), in view of the reduction in performance commissions and the concurrent increase in management fees. Overall, the earning margin rose by 6.6% (about EUR 6.5 million). Operating expenses

196 • Notes to the Consolidated Financial Statements - Part L FINANCIAL YEAR 2010

for the segment were in line with the previous year. In 2010, loan adjustments were about EUR -4.2 million compared to EUR -18 million, leading to earnings before tax of EUR 33 million compared to EUR 11 million in the previous year.

• In 2010, the Finance Segment reported profits in line with 2009. The reduction in net interest was more than offset by growth in net profit on instruments held for trading. The earnings margin rose by 4% y/y, the L division’s costs were up by 8% y/y, and operating profit rose by EUR 1 million (+3.7%). Value adjustments on securities in the AFS portfolio were down by EUR -2 million leading to a slight reduction (-4%) in earnings before tax. • The new method for calculating the transfer rate for in-house bond issues (which assigns a positive margin to the distribution channel) had a negative impact on the Corporate Centre’s notional treasury operations.

Because of the variation of the responsibility perimeter for the AFS portfolio, unlike 2009, in 2010 no results ts - Part

were reported in this segment. The growth in operating costs in the staff areas had an impact on the Corporate n Centre’s contribution to operating profit and profits before non-recurring items.

Consolidated operating figures by segment (Thousands of €)

Consolidated Client Segment Finance Segment Corporate Center Total tateme S 2010 2009 2010 2009 2010 2009 2010 2009

Net interest 37 ,777 25 ,639 7 ,642 12 ,126 -16 ,292 -9 ,477 29 ,127 28 ,287 ial Net commissions 70 ,566 74 ,709 -468 -179 9 -456 70 ,106 74 ,074

Fee and commission income 113 ,757 111 ,969 - 0,00 756 447 114 ,513 112 ,416 nc

Fee and commission expenses -43 ,191 -37 ,260 -468 -179 -747 -903 -44 ,407 -38 ,342 a

Dividends and similar income - - 2 ,929 190 - 1 ,090 2 ,929 1 ,280 n Net profit on instruments held for trading -633 718 15 ,542 12 ,640 - - 14 ,909 13 ,358 Net profit on hedging instruments - - -18 563 18 -10 - 553 Profit (loss) on disposal or repurchase -370 -340 7 ,468 6 ,369 - 7 ,416 7 ,098 13 ,445 Intermediation margin 107 ,340 100 ,726 33 ,095 31 ,708 -16 ,265 -1 ,437 124 ,169 130 ,997 Gross operating expenses -72 ,999 -72 ,317 -5 ,042 -4 ,654 -23 ,320 -21 ,055 -101 ,361 -98 ,026 solidated Fi

Other operating income/ n charges 847 850 - - 2 ,280 2 ,889 3 ,127 3 ,739 Net operating expenses -72 ,153 -71 ,467 -5 ,042 -4 ,654 -21 ,039 -18 ,166 -98 ,234 -94 ,287 Operating income 35 ,187 29 ,259 28 ,053 27 ,054 -37 ,305 -19 ,603 25 ,935 36 ,710 Net value adjustments on loans -4 ,225 -18 ,221 - - -1 - -4 ,226 -18 ,221 Net allocations to provisions for risks and charges - - - - -3 ,237 -11 ,909 -3 ,237 -11 ,909 Profit of equity investments accounted for using equity method - - - - 27 345 27 345 Profit before

non-recurring items 30 ,962 11 ,038 28 ,053 27 ,054 -40 ,515 -31 ,167 18 ,499 6 ,925 Notes to the Co Profit (loss) on disposal and value adjustments of financial instruments - - -2 ,152 -51 - 5 ,755 -2 ,152 5 ,704 Value adjustments for impairment of equity investment - - - - 996 - 996 - Earnings before tax 30 ,962 11 ,038 25 ,901 27 ,003 -39 ,519 -25 ,412 17 ,344 12 ,629

Notes to the Consolidated Financial Statements - Part L • 197 FINANCIAL YEAR 2010

Breakdown by business segment: consolidated balance sheet figures In 2010 the Client Segment reported loan growth of about EUR 130 million (+7.4%) and a reduction in deposits of about EUR 330 million.

The Finance Segment reported a net negative financial position of EUR 160 million, which was down by EUR 108 L million compared to 2009, and a reduction in financial assets (net of liabilities) of about EUR 110 million. The Corporate Centre was in line with the previous year except for the change in responsibility for AFS securities as described above.

Consolidated balance sheet figures by segment (Thousands of €)

Consolidated For third parties For Group Corporate Center Total ts - Part 2010 2009 2010 2009 2010 2009 2010 2009 n Cash on hand 188 1 ,265 3 ,320 3 ,523 2 - 3 ,511 4 ,788 Loans to clients 1 ,849 ,561 1 ,722 ,812 5 ,494 10 ,249 196 115 1 ,855 ,250 1 ,733 ,176 Loans to banks - - 259 ,129 441 ,320 896 532 260 ,024 441 ,853 Financial assets held for trading - - 414 ,296 532 ,325 - - 414 ,296 532 ,325

tateme Financial assets available-for-sale - - 399 ,408 329 ,561 - 43 ,550 399 ,408 373 ,110

S Financial assets held to maturity - - 5 ,627 5 ,551 - - 5 ,627 5 ,551 Equity Investments - - - - 5 ,950 5 ,996 5 ,950 5 ,996

ial Investments - - - - 250 ,685 216 ,945 250 ,685 216 ,945 Other assets - - - - 95 ,883 123 ,877 95 ,883 123 ,877 nc BALANCE SHEET ASSETS 1 ,849 ,749 1 ,724 ,077 1 ,087 ,273 1 ,322 ,529 353 ,611 391 ,015 3 ,290 ,633 3 ,437 ,621 a

n Due to banks - - 419 ,400 493 ,093 34 ,594 - 453 ,994 493 ,093 Due to clients 1 ,576 ,839 1 ,962 ,771 163 ,062 2 ,435 10 ,707 13 ,840 1 ,750 ,607 1 ,979 ,046 Outstanding securities 415 ,447 365 ,581 - - - - 415 ,447 365 ,581 Financial liabilities held for trading 635 384 148 ,894 85 ,539 - - 149 ,529 85 ,923 Liabilities associated with disposal groups held for sale - - - - - 602 - 602 Hedging derivatives - - - - 148 94 148 94 Provisions and other liabilities - - - - 110 ,780 110 ,779 110 ,780 110 ,779 solidated Fi Shareholders’ equity - - - - 410 ,129 402 ,504 410 ,129 402 ,504 n BALANCE SHEET LIABILITIES AND SHAREHOLDERS’ EQUITY 1 ,992 ,921 2 ,328 ,736 731 ,356 581 ,067 566 ,357 527 ,818 3 ,290 ,633 3 ,437 ,621 Notes to the Co

198 • Notes to the Consolidated Financial Statements - Part L FINANCIAL YEAR 2010

CONSOLIDATED FINANCIAL STATEMENTS AS OF 31 DECEMBER 2010 CERTIFICATION OF THE CONSOLIDATED FINANCIAL STATEMENTS, IN ACCORDANCE WITH ARTICLE 81 - TER OF CONSOB REGULATION NO. 11971 OF 14 MAY 1999 AS AMENDED AND SUPPLEMENTED

FINANCIAL YEAR 2010

FINANCIAL YEAR 2010

Certification of the consolidated financial statements, in accordance with Article 81-ter of the Consob regulations no. 11971 of 14 May 1999 as amended and supplemented

TS N

1. The undersigned parties, Pietro D’Aguì, acting in the capacity of Chief Executive Officer, and Mauro Valesani, acting in the capacity of the Executive in charge of company accounting documents of Banca Intermobiliare di Investimenti e Gestioni S.p.A., hereby certify, taking into account the provisions of Article 154 bis, paragraphs 3 and 4, of Legislative Decree no. 58 of 24 February 1998: STATEME ∞ The adequacy – in relation to company characteristics – and ∞ the effective application

IAL of administrative and accounting procedures for the preparation of the consolidated financial statements during the course of the financial year 2010. NC A

N 2. It is also hereby certified that the consolidated financial statements, at 31 December 2010: I ∞ are consistent with the accounting books and entries;

F ∞ are drafted in accordance with IAS/IFRS accounting principles issued by IASB, in accordance with Legislative Decree no. 38 of 28 February 2008, as well as in compliance with Memorandum no. 262 of 22 December 2005, and its subsequent amendments, issued by Bank of Italy, and Consob provisions for listed issuers; ∞ provide a truthful and accurate representation of the economic and financial situation of the issuer as well as of the group of consolidated companies.

SOLIDATED 3. The report on operations includes a reliable analysis of operational trends and results as well as

N on the situation of the issuer and of the consolidated companies in addition to a description of O the primary risks and uncertainties to which they are exposed.

C

THE

F

O Turin, 14 March 2011

N Chief Executive Officer Executive in charge of company accounting documents ATIO

C I F

ERTI

C

Pietro D’Aguì Mauro Valesani

204

200 • Certification of the Consolidated Financial Statements FINANCIAL YEAR 2010

CONSOLIDATED FINANCIAL STATEMENTS AS OF 31 DECEMBER 2010

STATUTORY AUDITORS’ REPORT ON THE CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS BANCA INTERMOBILIARE DI INVESTIMENTI E GESTIONI S.P.A.

REPORT OF THE BOARD OF STATUTORY AUDITORS ON THE FINANCIAL STATEMENTS OF THE YEAR ENDED 31 DECEMBER 2010, IN ACCORDANCE WITH ARTICLE 153 OF LEGISLATIVE DECREE 58/98

*** ***

To the shareholder meeting of the company “BIM - BANCA INTERMOBILIARE DI INVESTIMENTI E GESTIONI S.P.A.”. The draft financial statements for the year closed on 31 December 2010, which include the Explanatory Notes as well as the Director’s Report on Operations were approved by the Board of Directors and made available by the Board of Statutory Auditors on 14 March 2011. This report was drafted in compliance with the provisions of Legislative Decree no. 58/98 as well as the supervisory provisions of Bank of Italy. As a result of the merger by incorporation of the company Cofito Spa (controlling shareholder of Banca Intermobiliare), stipulated on 18 February 2011 and registered in the Company Registry of Companies of Treviso and Turin on 25 February 2011, Veneto Banca S.c.p.a. acquired legal control over the Issuer, Banca Intermobiliare. Following the aforementioned acquisition, in accordance with Articles 102 and 106, paragraph one, of the Consolidated Law on Finance, the required legal conditions were met for the promotion of a mandatory takeover bid from Veneto Banca S.c.p.a. in relation to the residual outstanding BIM shares. The acquisition of control over BIM from Veneto Banca has resulted in the requirement – on the basis of the assumption that management and coordination STATUTORY AUDITORS’ REPORT activities of the subsidiary have to be carried on by the parent company – to implement the decision-making and control processes within the parent company Veneto Banca with reference to the subsidiary. This will allow BIM to complete the process of updating and improving procedures, process which was, moreover, one of the primary efforts, recognized by the Board of Statutory Auditors, implemented by the entire organization structure of BIM during the course of the recently closed year. This objective must refer to the areas which were targeted for critical intervention by the supervisory authorities in relation to noted deficiencies in the internal organization and controls; it may be achieved by inserting new managerial resources within the Committees that monitor certain operational departments of the bank. Particular focus must continue to be applied to the loans division which is still characterized by a series of critical elements associated with the objective complexity of certain credit positions, particularly the “significant exposures” associated to parties operating in the real estate

202 • Statutory Auditors’ Report sector. Given the above, constant attention must always be given to the need for rigorous preventive evaluation processes as well as credit and risk monitoring activities related to the changing value over time of guarantees linked to the total amount of loans, particularly in the real estate sector. Finally, the Board of Statutory Auditors acknowledges the declared intention of the institution to rapidly proceed to appoint a General Manager: this will increase the efficiency of decision-making and control processes.

SUPERVISORY ACTIVITIES 1. Supervisory activities were implemented in compliance with statutory norms (Article 2403 of the Italian Civil Code) and with Articles 149 et sequitur of Legislative Decree no. 58/98, having taken into account the code of ethics of the Board of Statutory Auditors in companies which use venture capital markets - issued by the Italian accounting professional board – while also taking into consideration the recommendations of Consob and Bank of Italy. 2. The Board of Statutory Auditors has participated in the meetings of the Board of Directors (total of 13) as well as the meetings of the Internal Control Committee (totalling 9) and has ensured that all resolutions which were approved and implemented were in compliance with the law and the social statute. 3. During the course of the year 2010, the current Board of Statutory Auditors – appointed on 25.06.2010 – held numerous meetings, of which 10 were minuted, while the Board of Statutory Auditors which held office until the aforementioned date of 25.06.2010 minuted four meetings, which were attended by the managers of the main company departments. Activities

focused on continual meetings with Internal Audit managers in order to STATUTORY AUDITORS’ REPORT verify the adequacy of internal control processes; the audits did not reveal deficiencies or irregularities in the processes or methods of application. 4. The managers of organizational areas and internal control departments have constantly and personally made periodical reports on implemented activities for the control body. 5. The Board of Statutory Auditors has monitored the adequacy of the administrative/accounting system as well as the reliability of the latter to correctly report operational facts through the information gathered from the managers of the respective departments as well as through meetings with the managers of the auditing company (independent auditors) and by analysing the results of the latter’s work and the auditing company documents. 6. The Board of Statutory Auditors has obtained all required information

Statutory Auditors’ Report • 203 on the operations implemented by the bank and on the most significant operations and has exchanged mutual assessments and information with the company entrusted with company auditing; the independent auditors (auditing company) did not report any irregularities or illegal actions to the Board of Statutory Auditors. 7. The Board of Statutory Auditors also met with the managers of the primary internal divisions of the bank in order to implement its supervisory activities and has received continual and adequate informational reports on a periodic basis. 8. The Board of Statutory Auditors has monitored the development of risk management activities in order to guarantee effective oversight – in terms of measurement, control and management - of the primary risks to which the bank is exposed; it has received updates in relation to the completion of the Internal Capital Adequacy Assessment Process (ICAAP). 9. The Board of Statutory Auditors has monitored the activities which were implemented and programmed by the compliance department in relation to the identification and evaluation of non-compliance risks and to controls on operations implemented with reference to the organizational structure, processes and procedures, including those of an operational and commercial nature. 10. The Board of Statutory Auditors has periodically monitored the activities implemented by the Compliance Department in order to verify compliance with anti-money laundering regulations. The Board of Statutory Auditors acknowledges the periodical reports drafted by the legal department and reviewed by the Compliance Department in relation to the outcomes of

STATUTORY AUDITORS’ REPORT client complaints; no significantly critical positions emerged. 11. The Board of Statutory Auditors has continued to recommend, in its relations with compliance activities, incisive actions to verify the adoption and compliance – both formal and substantive – of the norms pursuant to Legislative Decree no. 231/2007 (Anti-Money Laundering and Anti- Terrorism Regulations) as well as those regarding MiFID (Markets in Financial Instruments Directive). 12. During the course of the supervisory activities described above, no significant facts which would require a mention in this report emerged. On the basis of acquired information and implemented controls, the Board of Statutory Auditors has noted that the operations implemented by the bank, in particular those of major economic and financial significance, were implemented in compliance with the law and the social statute and were not explicitly

204 • Statutory Auditors’ Report imprudent, risky or capable of jeopardizing the integrity of company assets. 13. The Board of Statutory Auditors has verified that, within the Group, suitable procedures exist and are fully complied, guaranteeing that intragroup operations, as well as ordinary operations with related parties (IAS 24), have been completed under normal market conditions and in accordance with company interests; these operations are appropriately reported in the Report on Operations and in the Explanatory Notes. For this purpose, it should be noted that, on 01/12/2010, the company adopted specific regulations with reference to operations with related parties. 14. With specific reference to the strengthening of the Financial Services Division, Loans Department, the year 2010 was characterized by a re- structuring of the division for the loans, monitoring & reporting and analysis departments as well as by the introduction of the electronic management of certain operations and the improvement of information flows to control and administrative bodies, following the implementation of the standards used in the Veneto Banca group. The Board of Statutory Auditors also noted that processes are underway to align the procedures in use in Bim with those implemented within the Veneto Banca group; these procedures should become fully operational within the current year when the migration to the SEC IT system of the parent company should be completed. 15. The administrative body and the control bodies have specifically and constantly focused on settling any credit position which arose in previous years with respect to parties operating in the real estate sector; some of these positions are being closed but have not yet been settled. 16. With reference to relations with control bodies of subsidiaries of the bank, the gathering of information has continued through questionnaires which STATUTORY AUDITORS’ REPORT are collected on a half-yearly basis from the relative bodies of the subsidiaries; periodical meetings have also been initiated in order to assess and monitor specific problems which arose within the companies. - With reference to supervisory activities over the financial statements, it should be noted that the analytical controls and the auditing of the substance of their contents were assigned – in compliance with Article 165 of Legislative Decree no. 58/98 – to the independent auditors Deloitte & Touche Spa. Given that the Board of Statutory Auditors was not delegated control over the content of the financial statements, a general monitoring system was implemented with reference to the latter, in order to ensure their compliance with the law

Statutory Auditors’ Report • 205 in relation to form and structure; the Board of Statutory Auditors approves the adopted structure. It should be noted that the company Deloitte & Touche Spa - entrusted with company auditing – has expressed a positive assessment of the financial statements in question and no irregularities or informational references were noted. The Board of Statutory Auditors hereby certifies, within its competence and in light of the information received from the independent auditors and the administrative body, that the financial statements at 31.12.2010 are in compliance with the law. During the course of the year 2010, the Board of Statutory Auditors did not receive any report pursuant to Article 2408 of the Italian Civil Code.

Explanatory Notes and Report on Operations The explanatory notes list the principles for the preparation of the financial statements and adequately illustrate the criteria which were applied in valuating accounting items that reflect the provisions of the new IAS/IFRS accounting principles. They supply the information which is necessary in order to give a full insight on the various financial statements with detailed analyses, particularly on: - Accounting policies/classification criteria/booking criteria/valuation criteria for the various financial statement items; - Information on the Balance Sheet; - Information on the Income Statement; - Segment information; - Information on risks and on the relative hedging policies;

STATUTORY AUDITORS’ REPORT - Information on assets; - Business combination operations in relation to companies or company branches; - Operations with related parties. The Board of Statutory Auditors hereby notes that, as a result of the impairment test, procedures adopted by the directors and illustrated within the explanatory notes of the financial statements of the year, no lasting value decreases were noted for goodwill and, as a result, no adjustment to the related item was applied. The director’s report describes the most important facts of the company and includes analysis of operational trends, the organizational structure and resources. This document also illustrates significant events which occurred after the closing of the year as well as strategies and an operational forecast.

206 • Statutory Auditors’ Report The report of the administrative body stated that the financial statements in question have been drafted in light of a going concern, even in compliance with the specifications supplied in the document that was jointly issued by Bank of Italy, Consob and Isvap. The Board of Statutory Auditors has verified compliance with legal norms related to the preparation of the Report on Operations and, with reference to this point, has no specific observations.

Conclusion Given the above, the Board of Statutory Auditors hereby expresses its favourable opinion in relation to the approval of the financial statements for the year closed on 31 December 2010 as well as for the proposal of allocation of the net income of the year.

Treviso, 29.03.2011.

The Board of Statutory Auditors Mr. Paolo De Poi Mr. Paolo Andolfato Mr. Roberto D’Imperio STATUTORY AUDITORS’ REPORT

Statutory Auditors’ Report • 207

FINANCIAL YEAR 2010

CONSOLIDATED FINANCIAL STATEMENTS AS OF 31 DECEMBER 2010

INDEPENDENT AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS INDEPENDENT AUDITORS’ REPORT

210 • Independent Auditors’ Report INDEPENDENT AUDITORS’ REPORT

Independent Auditors’ Report • 211

FINANCIAL YEAR 2010

CBilaONSOLIDATEDncio consolidato FINANCIAL STATEMEAL 31 dicNemTSb re 2010 AT 31 DECEMBER 2010 RELAZIONE DELLA SOCIETÀ ADINN REEXVESISIO TON ETHE AL BILANCIO CONSOLIDATEDSOLIDATO FINANCIAL STATEMENTS FINANCIAL YEAR 2010 Annex 1 - Independent auditors’ fees related to the Consolidated financial statements

DISCLOSURE OF FEES PAID FOR AUDITING SERVICES AND FOR SERVICES OTHER THAN THE AUDITING OF THE CONSOLIDATED FINANCIAL STATEMENTS

1. Information disclosure obligation

Article 2427, paragraph 16 bis, and Article 149 duodecies of the CONSOB Issuers Regulations no. 11971 have introduced specific requirements in relation to the disclosure of auditing fees.

2. Quantitative information

Type of services Entity supplying the service Recipient Fees (€/thousand) Audit Deloitte & Touche S.p.A Parent company 110 ees related

f Audit Deloitte & Touche S.p.A Subsidiaries 153 Other services - Signing of tax returns Deloitte & Touche S.p.A Parent company 10 - Signing of tax returns Deloitte & Touche S.p.A Subsidiaries 7 - Agreed auditing procedures Deloitte & Touche S.p.A Parent company 2 ditors’ - Auditing of annual reports of managed CIU’s (1) Deloitte & Touche S.p.A Subsidiaries 227 u Total 509

t a (1) These fees are charged to the mutual funds and not the asset management companies (AMC’s) n de n e p de In 1 - x e Ann

214 • Annex 1 - Independent auditors’ fees related GROUP

BFINANCIALANCA YEAR 2010 INTERMOBILIARE DI INVESTIMENTI E GESTIONI S.p.A.

SEPARATE FINANCIAL STATEMENTS AT 31 DECEMBER 2010 29th FINANCIAL YEAR

Registered Office: Via Gramsci, 7 10121 Turin

Share capital e 156,209,463 fully paid-up

Bank Code no. 3043.7 Banks Register no. 5319

Turin company register no. 02751170016

Chamber of commerce for industry agriculture and handicrafts of Turin, listed under Economic Administrative Index no. REA 600548 Tax Code/ VAT number 02751170016

Subscribing to the National Compensation Fund and to the Deposit Protection Fund

A MEMBER OF THE VENETO BANCA BANKIKG GROUP

(Registered with the Register of Banking Groups on 8/06/1992 code no. 5035.1) and subject to Management and Coordination Activities of Veneto Banca S.c.p.a. 216 ∙ FINANCIAL YEAR 2010

SEPARATE FINANCIAL STATEMENTS 31 DECEMBER 2010

SEPARATE MANAGEMENT REPORT FINANCIAL YEAR 2010

parent bank’s main date

PARENT BANK’S Summary Date

31.12.2010 31.12.2009 Change Change amount % RECLASSIFIED ECONOMIC VALUES ( stated in EUR ‘000) Net interest income 27,319 25,919 1,400 5.4% Net operating income 98,282 93,334 4,948 5.3% Operating profit (loss) 26,662 23,805 2,857 12.0% Profit before non-recurring components 20,197 (5,000) 25,197 n.a. Profit (loss) before tax 20,143 704 19,439 n.a. Group profit (loss) for the year 13,872 (607) 14,479 n.a. ASSETS AND OPERATING VALUES (stated in millions of euro) Total client assets 11,637 11,754 (117) -1.0% Invested assets 1,865 2,159 (294) -13.6% Invested assets (assets under management) 9,772 9,596 176 1.8% Performing loans to clients 1,593 1,302 291 22.4% Total assets 3,119 3,157 (38) -1.2% Group equity 354 346 8 2.3% Regulatory capital 433 455 (22) -4.8% RISK ASSETS AND EQUITY RATIOS Risk-weighted assets (in millions of euro) 1,657 1,888 (231) Tier 1 capital ratio 19,38% 16,48% 2,90% Total capital ratio 26,15% 24,12% 2,03% OPERATING STRUCTURE (stated in units)

SEPARATE MANAGEMENT REPORT Number of employees and collaborators (total) 550 556 (6) -1.1% - of which Banca Intermobiliare employees 492 492 - 0.0% - of which Banca Intermobiliare private bankers 189 186 3 1.6% Number of Banca Intermobiliare branches 29 29 - -

218 • Separate management report FINANCIAL YEAR 2010

31.12.2010 31.12.2009 Change % points INCOME RATIO Net interest income/Net operating income 27.8% 27.8% - Net fee and commission income/Net operating income 35.4% 37.3% -1.9% Cost/income ratio (excluding other operating charges/income) 73.9% 75.6% -1.7% Cost/income ratio (including other operating charges/income) 72.9% 74.5% -1.6% R.O.E. 4.0% -0.2% 4.1% CREDIT QUALITY RATIO Net impaired assets / Performing loans 11.2% 25.3% -14.1% - of which net non-performing loans/Performing loans 8.2% 10.6% -2.4% Net impaired assets / Loans to clients 9.3% 18.8% -9.4% - of which net non-performing loans/Loans to clients 6.9% 7.8% -0.9% Percentage of non-performing loans hedging 29.4% 32.0% -2.6%

31.12.2010 31.12.2009 Change Change amount % EMPLOYEE INFORMATION (in €/’000) Net operating income / Number of employees 179 168 11 6.5% Personnel costs/ Average number of employees 81 79 2 2.5% Total assets/ Number of employees 5,672 5,678 (6) -0.1%

31.12.2010 31.12.2009 Change Change amount % INFORMATION ON BANCA INTERMOBILIARE EQUITY Number of outstanding ordinary shares 149,041,517 149,067,507 (25,990) 0.0% Unit equity on outstanding shares in EUR 2.37 2.32 0.05 2.2% Official price per ordinary share during the year Average 4.04 3.02 1.02 33.8% SEPARATE MANAGEMENT REPORT minimum 3.15 2.12 1.03 48.6% maximum 4.32 4.16 0.16 3.8% Basic EPS (basic EDP) - EUR 0.09 (0.01) 0.10 NA Diluted EPS (basic EDP) - EUR 0.08 (0.01) 0.09 NA

Pre paration of reclassified aggregates In order to allow a clearer reading of economic and equity results in relation to the tables indicated in Banca d’Italia memorandum 262/05, the reclassified accounts have been prepared in tables which introduce some new items and combinations and for which analytical information has been provided in accordance with Consob requirements laid down in its Communication no. 6064293 of 28 July 2006. In relation to the financial statements published at 31.12.2009, the balance of interest receivable has been reclassified to display, after the closing balances, the net spread between interest receivable and payable related to derivative contracts.

Separate management report • 219 FINANCIAL YEAR 2010

Reclassified separate financial statements

RECLASSIFIED INCOME STATEMENT (in €/‘000)

Period Period Change Change 2010 2009 amount % Interest income and similar items 58,970 72,612 (13,642) 18.8% Interest expense and similar items (31,651) (46,693) 15,042 -32.2% Net interest income 27,319 25,919 1,400 5.4% Fee and commission income 61,098 54,622 6,476 11.9% Fee and commission expenses (21,819) (19,799) (2,020) -10.2% Net fees and commissions 39,279 34,823 4,456 348.1% Dividends 9,745 1,280 8,465 661.3% Net profit (loss) on trading instruments 14,913 17,314 (2,401) -13.9% Net profit (loss) on hedging instruments - 553 (553) -100.0% Net profit (loss) on sale of other instruments 7,026 13,445 (6,419) -47.7% Net operating income 98,282 93,334 4,948 5.3% Personnel costs (41,718) (41,410) (308) 0.7% Other administrative overheads (27,514) (25,553) (1,961) 7.7% Operating amortisation and depreciation (3,407) (3,591) 184 -5.1% Other operating charges/income 1,019 1,025 (6) -0.6% Operating costs (71,620) (69,529) (2,091) 3.0% Operating profit (loss) 26,662 23,805 2,857 12.0% Net value adjustments on loans (4,218) (18,106) 13,888 -76.7% Net provisions to reserve for risks and charges (2,545) (10,640) 8,095 -76.1% Net value adjustments on investments 298 (59) 357 NA Profit (loss) before non-recurring components 20,197 (5,000) 25,197 NA

SEPARATE MANAGEMENT REPORT Profit (loss) from disposal and value (1,050) 5,704 (6,754) -118.4% adjustments on financial instruments Profit (loss) from investment disposal 996 - 996 NA Profit (loss) before tax 20,143 704 19,439 -3.6% Income taxation (6,271) (2,465) (6,975) 283.0% Profit (Loss) of current operations after tax 13,872 (1,761) 12,464 NA Profit (Loss) of discontinued operations after tax - 1,154 (1,154) -100.0% Profit (Loss) for the year 13,872 (607) 11,310 NA

In order to achieve a clearer management representation of results (in relation to the income statement reported in the Financial Statements Section), the costs relating to the variable component of private bankers’ remuneration under the item “Personnel costs” have been reclassified under the item “Commission expense” for €/thousand 3,001 (€/thousand 3,637 at 31/12/2009) and additional charges for securities lending from the item “Interest payable” to the item “Net profit (loss) of trading activities” for €/thousand 512 (€/thousand 171 at 31.12.2009).

220 • Separate management report FINANCIAL YEAR 2010

RECLASSIFIED BALANCE SHEET (in €/‘000)

ASSETS 31.12.2010 31.12.2009 Change Change amount % Cash 3,320 3,523 (203) -5.8% Loans: - Loans to clients for performing loans 1,593,459 1,302,124 291,335 22.4% - Loans to clients others 310,068 462,487 (152,419) -33.0% - Loans to banks 234,799 288,020 (53,221) -18.5% Financial assets: - Trading 398,177 516,194 (118,017) -22.9% - Available for sale 348,002 348,088 (86) - - Held to maturity 5,627 5,551 76 1.4% Fixed assets: - Investments 148,591 148,186 405 0.3% - Intangible and tangible 9,126 9,641 (515) -5.3% Other assets 68,221 73,407 (5,186) -7.1% Total assets 3,119,390 3,157,221 (37,831) -1.2%

LIABILITIES 31.12.2010 31.12.2009 Change Change amount % Loans payables: - Due to banks 560,571 529,031 31,540 6.0% - Due to clients 1,572,899 1,760,835 (187,936) -10.7% Outstanding securities 421,566 367,642 53,924 14.7%

Financial liabilities: SEPARATE MANAGEMENT REPORT - Trading 149,349 86,000 63,349 73.7% Specific provisions 15,464 18,827 (3,363) -17.9% Other liability items 45,675 49,014 (3,339) -6.8% Equity 353,866 345,872 7,994 2.3% Total liabilities 3,119,390 3,157,221 (37,831) -1.2%

Separate management report • 221 FINANCIAL YEAR 2010

Operating figures and balance sheet data

Assets under administration and custody

The Group’s total assets under administration and custody at 31.12.2010 amounted to € 11,637m, after duplications, slightly down on the previous year. Assets under management were € 9.8m while deposits and other securities amounted to € 1.9m.

Breakdown of clients assets under administration and custody at 31.12.2010 (in millions of euros) 31.12.2010 31.12.2009 Change Change amount % Deposits and other securities 1,865 2,159 (294) -13.6% Invested assets 9,772 9,596 176 1.8% CLIENTS ASSETS UNDER ADMINISTRATION AND CUSTODY 11,637 11,754 (117) -1.0%

Details of assets under administration and custody at 31.12.2010 (in millions of euros)

31.12.2010 31.12.2009 Change Change amount % DEPOSITS AND OTHER SECURITIES Due to clients 1,413 1,761 (348) -19.8% Securities issued 452 398 54 13.6% total deposits and other securities 1,865 2,159 (294) -13.6% INVESTED ASSETS Assets under management 9,772 9,596 177 1.8% total invested assets 9,772 9,596 177 1.8%

SEPARATE MANAGEMENT REPORT ASSETS UNDER ADMINISTRATION AND CUSTODY 11,637 11,754 (117) -1.0%

Deposits and other securities With the evolution of money market rates, clients have progressively reduced the exposure on current accounts and REPOs, favouring different loans for their cash and in particular choosing managed asset instruments. Therefore, deposits and other securities decreased by € 294m during the year, amounting to € 1,865m.

Invested assets Invested assets totally made up of assets under administration were € 9,772m, an increase of 1.8% both for new capital contribution and for the value recovery of security prices.

222 • Separate management report FINANCIAL YEAR 2010

Loans and other loans to clients

The amount of loans to clients at 31.12.2010 was € 1,904m, an increase of 7.9%, mainly due to an increase in performing loans of approximately € 291m during the year, of which around € 143m related to new disbursements and around € 148m related to previously impaired positions returning to performing loans during the period.

Details of loans to clients (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Performing loans to clients 1,593,459 1,302,124 291,335 22.4% Other loans to clients 310,068 462,487 (152,419) -33.0% Total loans to clients 1,903,527 1,764,611 138,916 7.9%

Performing loans to clients (in /‘000)

31.12.2010 31.12.2009 Change Change amount % Overdraft 930,663 828,435 102,228 12.3% Mortgage loans 458,956 333,838 125,118 37.5% Short-term borrowings 203,840 139,851 63,989 45.8% Total performing loans 1,593,459 1,302,124 291,335 22.4%

Performing loans to clients amounted to € 1,593m: the main types of disbursement are represented by overdraft for € 931m, equal to 64% of the total loans, by mortgage loans for € 459m, equal to 29% and by borrowings for € 204m, for the remaining 13%. The increase in performing loans is due to both new disbursements of credit carried out by clients, and to the return of some significant performing positions, mainly in the real estate segment.M ost of this activity happened in the first half of year 2010.

Other loans to clients SEPARATE MANAGEMENT REPORT (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Income and deposits to clearing houses 119,751 123,127 (3,376) -2.7% Securities lending with counterparties 7,020 2,660 4,360 163.9% Net impaired assets 177,793 326,440 (148,647) -45.5% Debt securities 5,494 10,249 (4,755) -46.4% Other positions 10 11 (1) -9.1% Total other loans to clients 310,068 462,487 (152,419) -33.0%

Separate management report • 223 FINANCIAL YEAR 2010

Other loans to clients amounted to € 310m, a decrease of 33% over 31.12.2009. This item includes income deposited with clearing houses and non-banking brokers with reference to derivative transactions on Italian and foreign markets, transactions of securities lending realized with institutional counterparties, net impaired activities and other minor positions. Net impaired assets went from € 326m to the current € 178m of which non-performing positions were € 130m, watchlist positions equalled € 26m, restructured positions were € 3m and expired exposures amounted to € 19m.

Net impaired assets (in €/‘000)

31.12.2010 31.12.2009 Change Change Net exposure Net exposure amount % Non-performing loans 130,544 138,461 (7,917) -5.7% Watchlist loans 25,920 106,760 (80,840) -75.7% Restructured exposures 2,784 1,541 1,243 80.7% Expired exposures 18,545 79,678 (61,133) -76.7% Net impaired assets 177,793 326,440 (148,647) -45.5%

Gross and net exposure of impaired assets (in €/‘000)

Gross Value Net Exposure Adjustments exposure Non-performing loans 184,821 (54,277) 130,544 Watchlist loans 26,947 (1,027) 25,920 Restructured exposures 3,198 (414) 2,784 Expired exposures 18,785 (240) 18,545 Impaired activities 233,751 (55,958) 177,793

SEPARATE MANAGEMENT REPORT Banca Intermobiliare registered a sharp decrease in impaired assets equal to approximately € 148m, mainly related to the return of overdraft positions (€ 61.1m) and to the significant drop in watchlist loans positions (€ 80.8m) due to the end of temporary difficulty of some debtors. Over 31.12.2009, non-performing net positions decreased by 5.7% mainly due to the collection of previous interests accrued on the main credit exposure towards the Coppola Group companies and towards Partecipazioni Immobiliari. Such exposure, assisted by investment and real estate guarantees, at 31 December 2010, amounted to approximately € 141m gross and around € 116m after valuation reserves. With reference to the watchlist loans net exposures and expired net exposures, during the first quarter the partial repayment of two relevant positions to clients operating in the real estate segment was carried out, as already mentioned in the financial statements at 31.12.2009 and in the subsequent interim financial statements of 2010. Both positions are presently classified as performing. In the first case, the watchlist loans position at 31.12.2009 for € 82m decreased after the client’s payment of € 23m, as partial repayment of capital and of some expired instalments. On this position, the residual exposure on the performing return date was € 59m. In relation to the second case, classified at 31.12.2009 among expired positions for € 59m, it is a position relating

224 • Separate management report FINANCIAL YEAR 2010 to companies that during the year were subject to corporate changes: the transition to a new majority shareholder allowed the position to return to normal conditions.

For further information related to cash and off-balance-sheet exposures of loans to clients as well as their movement see Part E “Information on Risks and relating hedging policies” Section 1.1 “Credit risk” of the Notes to the Separate Financial Statements.

O ther financial figures

Net financial position (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Loans Current accounts and free deposits 62,423 123,434 (61,011) -49.4% Loans and time deposits 44,947 9,227 35,720 387.1% Income for on demand derivatives operations 41,428 34,541 6,887 19.9% Debt securities 65,312 104,839 (39,527) -37.7% Securities lending and repos 10,099 8,305 1,794 21.6% Total due from banks 224,209 280,346 (56,137) -20.0% Loans payable Current accounts and other on demand deposits (119,282) (95,493) (23,789) 24.9% Loans and other forward debts (349,012) (80,940) (268,072) 331.2% Other payables (7,277) (259,441) 252,164 -97.2% Total due to banks (475,571) (435,874) (39,697) 9.1% Due from (to) Bank of Italy (74,410) (85,483) 11,073 -13.0% TOTAL NET FINANCIAL POSITION (325,772) (241,011) (84,761) 35.2%

The net financial position towards banks at 31.12.2010 was a debt of€ 326m compared with a debt position for € 241m at 31.12.2009. The significant increase in the net financial position is caused by the lower availability of deposits SEPARATE MANAGEMENT REPORT and other securities that occurred during the first quarter of this financial year. Operations with credit institutions were determined by very short term requirements for provision/use, typically in current accounts and overnight and short deposits as well as by the requirement caused by financial instrument transactions. Loans and other forward debts towards banks were mainly composed of a loan of € 245m taken out through syndicated lending in 2006 with 18 international banks that expired in February 2011 and is regularly repaid. The other payables are made up for € 92m of time deposits and for € 12m of other loans. Other types of loans consist of current accounts and on demand forward deposits for € 67m opened within major credit institutions. Banca Intermobiliare subscribes to the Collateralised Interbank Market and can participate in ECB auctions. Such exposures are subject to continuous monitoring by rate and cash risk management strategies, described in the market information section, “Information on risks” of the directors’ consolidated management report and in Part E, “Market risks” Section of the Notes to the Consolidated Financial Statements

Separate management report • 225 FINANCIAL YEAR 2010

F inancial Instruments

Financial instruments breakdown (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Portfolio of securities High frequency trading (Htf) 258,861 439,257 (180,396) -41.1% Trading liabilities (8,819) (7,290) (1,529) 21.0% Available-for-sale activities (Afs) 348,002 348,088 (86) 0.0% Held-to-maturity activities (Htm) 5,627 5,551 76 1.4% Debt securities (L&R) 70,806 115,088 (44,282) -38.5% Total portfolio of securities 674,477 900,694 (226,217) -25.1% Derivatives portfolio High frequency trading (Htf) 139,316 76,937 62,379 81.1% Trading liabilities (140,530) (78,710) (61,820) 78.5% Total derivatives portfolio (1,214) (1,773) 559 -31.5% TOTAL FINANCIAL INSTRUMENTS 673,263 898,921 (225,658) -25.1%

A t 31.12.2010 the securities portfolio recorded a decrease of 25.1% against a drop of € 180m of the trading securities portfolio and of €44m of the Loans & Receivables portfolio. The derivatives portfolio, compared with the situation at 31.12.2009, registered a significant increase in volumes (approximately +80%) related to a growing interest by clients in these markets: the derivatives portfolio is also made up of brokered positions on behalf of clients and balanced by the bank on the market; the net exposure between long term and short term position remained in line with the values at 31.12.2009. Financial markets throughout 2010 were influenced by a strong speculative movement in the first part of the year towards government bonds issued by Portugal, Ireland, Greece and Spain and, at the end of the financial year, towards corporate bonds more involved in the recent crisis in Middle-Eastern countries. In such a context, Banca Intermobiliare did not have proprietary investments in these segments and therefore was not exposed at 31.12.2010 to debt securities issued by the governments of the aforementioned Countries. Below, investments in financial instruments per type of

SEPARATE MANAGEMENT REPORT portfolio are listed.

226 • Separate management report FINANCIAL YEAR 2010

Financial assets held for trading (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Trading securities - Debt securities 242,430 425,345 (182,915) -43.0% - Share capital securities 16,431 10,810 5,621 52.0% - O.I.C.R. quotas - 3,102 (3,102) NA Total portfolio of securities 258,861 439,257 (180,396) -41.1% Trading derivative instruments - Security, index and currency derivatives 139,316 76,937 62,379 81.1% TOTAL TRADING FINANCIAL ASSETS 398,177 516,194 (118,017) -22.9%

The trading portfolio registered an overall decrease of 22.9% due to a significant drop in the securities invested component while the derivative component dramatically increased. At 31 December 2010, the portfolio of trading securities mainly consisted of debt securities. The derivatives held for trading portfolio mainly consisted of derivatives on brokered exchange rates between clients and institutional counterparties. At 31.12.2010, trading volumes were up compared to the previous year’s figures, due to a greater interest of clients in this type of transaction.

Financial liabilities held for trading (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Cash liabilities - debt securities - 2 (2) -100.0% - share capital securities 8,819 7,288 1,531 21.0% Trading derivative instruments - Security, index and currency derivatives 140,530 78,710 61,820 78.5% TOTAL FINANCIAL LIABILITIES HELD FOR TRADING 149,349 86,000 63,349 73.7% SEPARATE MANAGEMENT REPORT

Cash liabilities held for trading consisted of €/thousand 8,819 of technical overdraft on share capital securities. Derivative instruments, entered among financial liabilities for €/thousand 140,530, mostly consist of cross currency swaps balanced with similar derivative contracts on currencies, entered among financial activities held for trading for €/thousand 139,316.

Separate management report • 227 FINANCIAL YEAR 2010

F inancial assets available-for-sale (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Financial assets available-for-sale - Share capital securities 41,892 35,610 6,282 17.6% - Debt securities 244,154 252,550 (8,396) -3.3% - O.I.C.R. quotas 61,956 59,928 2,028 3.4% TOTAL FINANCIAL ASSETS AVAILABLE-FOR-SALE 348,002 348,088 (86) -

The portfolio of available-for-sale securities at 31 December 2010 is mainly in line with 31 December 2009. The most significant financial instruments of the portfolio are made up of debt securities for€ /thousand 244,154 while share capital securities and O.I.C.R quotas amount to a total of €/thousand 103,848. The portfolio breakdown at 31.12.2010 is represented by debt securities allocated to the Treasury portfolio mainly consisting of corporate and bank bonds, issued by Italian and European banks and with medium/long-term maturity, by O.I.C.R. quotas and share capital securities held for non-trading purposes. During the financial year, the portfolio of available-for-sale financial assets was subject to an impairment test according to the method outlined in part A of the Notes to financial statements - Accounting policies - showing an impairment situation for 2 securities only, with an economic impact equal to €/thousand 1,050.

F inancial assets held to maturity The securities portfolio of held-to-maturity financial assets equalled €/thousand 5,627 relating to a single bond investment listed on the Italian stock exchange market maturing in August 2011.

L oans & Receivables (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Loans & Receivables - Debt securities towards banks 65,312 104,840 (39,528) -37.7% SEPARATE MANAGEMENT REPORT - Debt securities towards clients 5,494 10,249 (4,755) -46.4% TOTAL LOANS & RECEIVABLES 70,806 115,089 (44,283) -38.5%

The Loans & Receivables securities portfolio consists of debt securities, mainly towards banks, unlisted on active markets, acquired as private placements and for non-trading purposes.

Outstanding securities Outstanding securities, issued by Banca Intermobiliare, mainly consist of bond issues amounting to €/thousand 417,201 and €/thousand 4,365 of banker’s drafts. The total debt for bond issues, after buy-backs, amounted to €/thousand 447,858 after adding debt for €/thousand 30,023 in relation to equity component spin-off of the convertible bond (recorded among equity as capital instruments) and the embedded derivatives evaluation for €/thousand 635 (recorded among trading financial liabilities). Bond issues refer to unlisted securities except for convertible bond issues dealt on the Milan Stock Exchange and amounting to € 164m (of which € 30m is entered to equity).

228 • Separate management report FINANCIAL YEAR 2010

Subsidiary and associated companies Investments (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Exclusive subsidiaries - Bim Suisse S.A. 24,714 24,714 - - - Banca Ipibi S.p.A. 39,319 39,212 107 0.3% - Symphonia SGR S.p.A 76,124 71,874 4,250 0.06 - Bim Alternative Investments SGR S.p.A. (i) - 4,250 (4,250) NA - Bim Fiduciaria S.p.A 465 465 - - - Bim Immobiliare S.r.l. 2,469 2,171 298 13.7% - Bim Insurance Brokers S.p.A. 61 61 - - - Immobiliare D S.r.l. (ii) - - - - Total exclusive subsidiaries 143,152 142,747 405 0.3% Companies subject to significant influence - Bim Vita S.p.A 5,439 5,439 - - TOTAL INVESTMENTS 148,591 148,186 405 0.3% i) The decrease in the above mentioned subsidiary relates to the merger through acquisition of the Bim Alternative Investments Sgr subsidiary into Symphonia Sgr that occurred on 1.1.2010. ii) Immobiliare D S.r.l.’s book value, investment coming from a credit collection transaction, which is explained in the following section of the report, amounts to 100 euros.

NON CURRENT ASSETS HELD for sale At 31.12.2009, Banca Intermobiliare entered groups of assets available for sale in the financial statements according to the IFRS 5 accounting policy amounting to €/thousand 30,041 and liabilities associated with groups of assets available for sale amounting to €/thousand 602 relating to the total share capital of Immobiliare D S.r.l.. For credit collection purposes, on 29 December 2009 Banca Intermobiliare took over the full share capital of

Immobiliare D S.r.l. from Gruppo Zunino, which owns the building in Piazza Sant’Erasmo in Milan, held for SEPARATE MANAGEMENT REPORT mortgage security for a credit exposure of € 33.7m to such group. In order to continue classifying the investment in accordance with the IFRS 5 accounting policy, it is subject to the following conditions: i) the asset must be available for immediate sale in its present condition and the sale shall be highly likely; ii) The Board of Directors shall commit itself to a programme of asset disposal, actions to locate a buyer shall start and the programme shall be completed; iii) The conclusion of the sale shall be carried out within a year from the classification date, with the exception of the possibility to extend such a period if the delay is caused by events or circumstances outside the acquiring company’s control and the latter remains committed to the disposal programme.

At 31.12.2010, considering that the aforementioned investment sale could not be estimated, the investment was reclassified from “groups of assets held for disposal” and “liabilities associated to groups of assets held for disposal” to “investment” with the subsequent line-by-line consolidation of the control investment on the consolidated financial statements.

Separate management report • 229 FINANCIAL YEAR 2010

Capital accounts

Changes in equity (in €/’000) 31.12.2010 31.12.2009 Change Change amount % Share capital 156,209 156,038 171 0.1% Treasury shares (-) (34,416) (33,802) (614) 1.8% Capital instruments 30,023 30,023 - - Share premium - 140 (140) -100.0% Reserves 191,500 191,580 (80) - Valuation reserves (3,322) 2,500 (5,822) -232.9% Profit (Loss) for the year 13,872 (607) 14,479 NA TOTAL EQUITY 353,866 345,872 7,994 2.3%

The equity at 31.12.2010 amounted to € 354m (+2.3% y-o-y). The main changes in equity over 31.12.2009 refer to the minimum value of the valuation reserve of the portfolio of available-for-sale financial assets, which decreased by €/thousand 5,822 in relation to fair value fluctuations.

Summary of changes in equity (in €/’000)

Equity at 31.12.2009 345,872 Share capital Stock granting issues to employees 17 Valuation reserves - fair value measurements on AFS securities (5,822) Other reserves Purchase and sale of treasury shares (614)

SEPARATE MANAGEMENT REPORT Profit from trading of own issued securities (156) Measurement of employee benefits according to IFRS 2 542 Profit (loss) for the year 13,872 Equity at 31.12.2010 353,866

Details of changes in individual equity for 2010 are reported in the specific table under the F“ inancial statements” Section. For details relating to treasury shares, see Section 14 of Part B of the Notes to the Separate Financial Statements.

Regulatory capital At 31.12.2010, Banca Intermobiliare’s individual regulatory capital, calculated according to P&L figures determined by the application of IAS/IFFR international accounting policies, amounted to € 432m, decreasing by € 23m over the 2009 figure. Capital ratios amounted to 26.15% referring to Total capital ratio and to 19.38% relating to Tier 1 ratio, improving over the previous financial year.

230 • Separate management report FINANCIAL YEAR 2010

2010 2009 Individual regulatory capital (millions of euros) 432 455 Total capital ratio 26.15% 24.12% Tier 1 ratio 19.38% 16.48%

For further quantitative and qualitative information on regulatory and capital ratios, please see the Notes to the consolidated financial statements Part F “Information on consolidated equity”, Section 2.

Financial results

Net interest income (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Interest receivable - financial assets held for trading 10,537 11,540 (1,003) -8.7% - available-for-sale financial assets 6,251 9,556 (3,305) -34.6% - financial assets held to maturity 188 262 (74) -28.2% - on due from banks 3,834 5,926 (2,092) -35.3% - on loans to clients 38,157 45,328 (7,171) -15.8% - other 3 - 3 NA Total interest receivable 58,970 72,612 (13,642) -18.8% Interest payable - on payables due to banks and other financing bodies (6,867) (7,527) 660 -8.8% - on payables due to clients (9,906) (21,622) 11,716 -54.2% - outstanding securities (13,245) (15,175) 1,930 -12.7% - trading financial liabilities (1,630) (2,351) 721 -30.7%

- other (3) (18) 15 -83.3% SEPARATE MANAGEMENT REPORT Total interest payable (31,651) (46,693) 15,042 -32.2% NET INTEREST INCOME 27,319 25,919 1,400 5.4%

At 31.12.2010, the net interest income increased by 5.4%, to €/thousand 27,319, compared to €/thousand 25,919 for the previous financial year, due to the combined effect of the financial figure trends and the market rate condition trends. During the last quarter, market conditions resulted in a slight recovery on income with reference to deposits and other securities, which had been totally counterbalanced in the recent past.

Separate management report • 231 FINANCIAL YEAR 2010

Net operating income (in €/‘000) 31.12.2010 31.12.2009 Change Change Amount % NET INTEREST INCOME 27,319 25,919 1,400 5.4% Net fees and commissions 39,279 34,823 4,456 12.8% Dividends 9,745 1,280 8,465 661.3% Net profit (loss) on trading instruments 14,913 17,314 (2,401) -13.9% Net profit (loss) on hedging instruments - 553 (553) -100.0% Net profit (loss) on other instrument disposal 7,026 13,445 (6,419) NA NET OPERATING INCOME 98,282 93,334 4,948 5.3%

The net operating income increased by 5.3%, from €/thousand 93,334 referred to 31.12.2009 to the current €/ thousand 98,282. The excellent result is mainly due to the contribution of the positive differential of net fees and commissions and dividends, which more than balanced trading activity profit and loss shrinkage, and also to disposal profits and payment of securities listed in the available-for-sale financial assets portfolio.D ividend contribution equalled €/thousand 9,745, an increase on the previous financial year, mainly due toS ymphonia Sgr’s dividend and to investments in available-for-sale securities.

Net fees and commissions (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Fees and commissions income - trading, management, order collection 31,487 30,735 752 2.4% - distribution of third-party services 25,709 20,121 5,588 27.8% - financial advisory 1,024 589 435 73.9% - other fees and commissions 2,877 3,178 (301) -9.5% Total fee and commission income 61,097 54,623 6,474 11.9%

SEPARATE MANAGEMENT REPORT Fee and commission expenses - return to commercial network (17,728) (16,331) (1,397) 8.6% - trading and administration (3,336) (922) (2,414) 261.6% - other services (754) (2,546) 1,792 -70.4% Total fee and commission expenses (21,818) (19,800) (2,018) 10.2% TOTAL NET FEES AND COMMISSIONS 39,279 34,823 4,456 12,8%

Fee and commission income at 31.12.2010 amounted to €/thousand 39,279 of which 51.5% was generated by the assets under administration and custody segment, 42.1% by distribution of third-party services and products and 6.4% by other transactions. The fees and commissions income result mainly benefited from the strong growth of the distribution of third-party services and other fees and commissions while those generated from assets under management and custody slightly decreased over the previous financial year.

232 • Separate management report FINANCIAL YEAR 2010

Fee and commission expenses amounted to €/thousand 21,818, increasing by 10.2% over 31.12.2009, mainly against remunerations to the network in relation to the high performance of the group’s asset management company.

Result of trading activity for proprietary account (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Dividends and similar income - Financial assets held for trading 382 190 192 101.1% - Available-for-sale financial assets 2,547 1,090 1,457 133.7% - Investments 6,816 - 6,816 - Total dividends 9,745 1,280 8,465 661.3% Net profit (loss) on trading instruments - Trading financial assets/liabilities 7,578 14,931 (7,353) -49.2% - Other financial assets/liabilities: exchange rate differences (633) (1,375) 742 -54.0% - Derivatives 7,968 3,758 4,210 112.0% Total net profit (loss) on trading instruments 14,913 17,314 (2,401) -13.9% TOTAL TRADING ACTIVITIES FOR PROPRIETARY ACCOUNT 24,658 18,594 6,064 32.6%

The total result of proprietary account increased by 32.6% over the previous financial year, amounting to €/thousand 24,658. Dividends contribution amounted to €/thousand 9,745, while the trading profit (loss), of €/thousand 14,913, decreased of 13.9%: a slower trading activity was balanced by the extremely positive result of the brokered derivatives portfolio.

Net profit (loss) on disposal of other financial instruments (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Net profit (loss) on disposal of other financial instruments SEPARATE MANAGEMENT REPORT - financial assets 7,395 13,785 (6,390) -46.4% - financial liabilities (369) (340) (29) 8.5% TOTAL NET PROFIT (LOSS) FROM DISPOSAL OF OTHER FINANCIAL INSTRUMENTS 7,026 13,445 (6,419) -47.7%

Finally, the net operating income benefitted from the positive result for €/thousand 7,026, mainly thanks to the disposal of available-for-sale securities. In particular, sold equity securities generated profits for €/thousand 6,460, while bond securities generated about €/thousand 1,750. The significant decrease in results over 2009 is due to the disposal of equity investment in theL se (London Stock Exchange) security which positively contributed for €/thousand 6.712. During the financial year the definitive disposal of the equity investment in Borsa Italiana S.p.A. (subsequently exchanged with Lse shares) was perfected, with a positive impact on this financial year equal to €/thousand 1,829.

Separate management report • 233 FINANCIAL YEAR 2010

Operating profit (loss) (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % NET OPERATING INCOME 98,282 93,334 4,948 5.3% Operating costs (71,620) (69,529) (2,091) 3.0% OPERATING PROFIT (LOSS) 26,662 23,805 2,857 12.0%

The operating profit (loss) amounted to €/thousand 26,662, increasing over the previous financial year. The expense/income ratio (including other operating income/charges) amounted to 72.8% (74.5% y-o-y).

Operating costs (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % Administrative overheads - personnel costs (41,718) (40,446) (1,272) 3.1% - other administrative overheads (27,514) (26,517) (997) 3.8% Operating amortisation and depreciation (3,407) (3,591) 184 -5.1% Other operating income/charges 1,019 1,025 (6) -0.6% OPERATING COSTS (71,620) (69,529) (2,091) 3.0%

Personnel costs amounted to €/thousand 41,718 at 31.12.2010, consisting of salaries and related charges of employees and compensation of directors and Statutory Auditors. The variable part of the compensation of employees belonging to the commercial network has been reclassified among fees and commissions expenses, in order to give a better management representation. Compared to the charge registered in the previous financial year, the annual increase was limited to 3.1%.

Other administrative overheads amounted to €/thousand 27,514, increasing over the previous period. The increase of 3.8% is mainly due to a higher charge for insurance policies to manage real estate and lease of

SEPARATE MANAGEMENT REPORT machines and software. With reference to expenses for external advisory services, apart from a slight increase in legal costs, expenses for organisation and information advisory services sharply decreased.

Operating amortisation and depreciation, equal to €/thousand 3,407 at 31.12.2010, decreased by 5.1% over the previous financial year.D uring the year no significant investments in tangible and intangible were registered and no impairment situations occurred.

Other operating income/charges amounted to €/thousand 1,019, in line with 31.12.2009 data .

Current result In order to make the reclassified profit and loss account more clearly readable, the current result is shown asresult “ before non-recurring components” which is the operating profit (loss) less value adjustments on loans, net provisions for liabilities and charges and subsidiaries’ result valued using the equity method.

234 • Separate management report FINANCIAL YEAR 2010

Profit (loss) before non-recurring components (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % OPERATING PROFIT (LOSS) 26,662 23,805 2,857 12.0% Net value adjustments on loans (4,218) (18,106) 13,888 76.7% Net provisions to reserve for risks and charges (2,545) (10,640) 8,095 76.1% Net value adjustments on investments 298 (59) 357 NA RESULT BEFORE NON-RECURRING COMPONENTS 20,197 (5,000) 25,197 NA

The result before non-recurring components amounted to €/thousand 20,197, strongly increasing compared to the negative figure of €/thousand 5,000 registered at 31.12.2009, due to fewer value adjustments on loans and to fewer provisions for liabilities and charges introduced in the period: the total amount was equal to €/thousand 6,763, against €/thousand 28,746 in 2009. During the 2009 financial year, the economic and financial crisis made clients’ credit standing worse, with subsequent increases in value adjustments on loans and provisions for liabilities and charges.

Net value adjustments on loans at 31.12.2010 amounted to €/thousand 4,218. In particular, total provisions for €/thousand 15,177 were allocated on impaired positions in order to have position updates analytically valued both in terms of collection of guarantees and by quantifying the charge related to the resolution time for doubtful loans. Write-backs amounted to €/thousand 10,792, carried out against the repayment of some exposures, among which Gruppo Coppola and Partecipazioni Immobiliari, due to the time-value effect.

Net provisions for liabilities and charges amounted to €/thousand 2,545 against a balance of €/thousand 10,640 related to 31.12.2009. Provisions mainly relate to legal cases liabilities, clients’ complaints and other liabilities. At the same time, write-backs were made because of the judicial and extra judicial resolution of some legal cases and complaints. Net charges included in the financial statements are also influenced by the time-value effect.

Net value adjustments on investments, fully related to the value recovery of Bim Immobiliare, amounted to the profit for the year registered in 2010.

SEPARATE MANAGEMENT REPORT Profit (loss) before tax (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % RESULT BEFORE NON-RECURRING COMPONENTS 20,197 (5,000) 25,197 NA Profit (Loss) from other financial investments disposal (1,050) 5,704 (6,754) -118.4% Profit (loss) from investments disposal 996 - 996 NA PROFIT (LOSS) BEFORE TAX 20,143 704 19,439 NA

Profit (loss) before tax amounted to €/thousand 20,143 against the previous financial year result of €/thousand 704 which was influenced by positive results related to theM anagement & Capital transaction.

Separate management report • 235 FINANCIAL YEAR 2010

The result of other financial investments disposal consisted of value adjustments carried out for impaired available- for-sale financial assets.A t 31.12.2010 the results of impairment tests showed an impairment loss equal to €/ thousand 1,050, due to the negative adjustment to fair value of two listed securities held by Banca Intermobiliare already subject to impairment in the previous financial years

The result of investments disposal was related to the disposal of 100% of shares of Parioli Sviluppo S.r.l., company acquired during the year by the parent bank as part of a credit collection transaction and promptly sold within the end of the year.

At 31.12.2010 impairment tests were carried out to assess the possibility of collecting amounts entered as goodwill against company acquisition transactions occurred during the previous financial years, without revealing impairment situations. For further information see qualitative information in the Notes to the consolidated financial statements in Part A - Accounting policies and in Part B - Section 13 “Intangible Assets”

Profit (Loss) of current operations after tax (in €/‘000) 31.12.2010 31.12.2009 Change Change amount % PROFIT (LOSS) BEFORE TAX 20,143 704 19,439 NA Income taxation (6,271) (2,465) (3,806) 154.4% Profit (Loss) of current operations after tax 13,872 (1,761) 15,633 NA

Against the current and deferred fiscal charge, calculated as always on the evolution of the reference tax regulations, the profit for the current operations after tax for the year amounts to€ /thousand 13,872, against a loss of €/ thousand 1,761 of the previous financial year.

Profit (Loss) for the year (in €/‘000)

SEPARATE MANAGEMENT REPORT 31.12.2010 31.12.2009 Change Change amount % Profit (Loss) of current operations after tax 13,872 (1,761) 15,633 NA Profit (Loss) of the assets held for disposal after tax - 1,154 (1,154) -100.0% Profit (Loss) for the year 13,872 (607) 14,479 NA

As already described above, at 31.12.2010 Immobiliare D investment was reclassified, after acquisition as part of a credit collection transaction from Gruppo Zunino, from “groups of assets held for disposal” and “liabilities associated to groups of assets held for disposal” to “investment”, considering that the terms of sale of the aforementioned investment cannot be estimated yet. The comparative figure related to profits for assets held for disposal relates to the disposal ofIPI S.p.A investment.

236 • Separate management report FINANCIAL YEAR 2010

Other aspects

For the following topics, see the Report on the Banca Intermobiliare Group consolidated management: - results of investments - information on the market - development and organisation activities - management and auditing activities - other aspects

For the following topics, see related sections in the Notes to the separate financial statements: - part E - Information on risks and related hedging policies - part H - Inter-group transactions and transactions with related parties - part I - Payment agreement based on own equity instruments - part L - Operating segment

R eport on corporate governance and ownership arrangements The annual report on Corporate Governance and ownership arrangements (2011 edition), approved by the Banca Intermobiliare’s Board of Directors under art. 123 bis, paragraphs 1 and 2, Legislative Decree 58/1998, is published in the issuer’s web site (Corporate Governance section), under paragraph 3 of the same article.

Tax audit on Banca Intermobiliare Parent Bank On 31 March 2010 a tax audit of Banca Intermobiliare began in relation to direct taxes, regional tax on production and VAT regarding previous financial years. At the approval date of these draft financial statements, the tax audit report had not yet been communicated. The main items identified by the company through the management of daily reports were analysed by the company’s management and its external advisors, who do not foresee any implications for the company. events AFTER THE FINANCIAL STATEMENTS REPORTING DATE SEPARATE MANAGEMENT REPORT

C hange of Parent Company Veneto Banca S.c.p.a., through a merger by incorporation of Cofito (majority shareholder of Banca Intermobiliare) on 18 February 2011, registered on the Treviso and Turin Company Registers on 25 February 2011, acquired legal control of the Issuer, Banca Intermobiliare. Following the aforementioned acquisition by Veneto Banca S.c.p.a., the legal requirements for a compulsory takeo- ver bid were met, pursuant to articles 102 and 106, paragraph 1 of the Italian Consolidated Law on Finance (TUF), in relation to outstanding residual BIM shares. The Bidder shall give each offer participant a cash price amounting to 4.25 Euros for each share surrendered to participate in the Offer. Veneto Banca intends to keep BIM shares listed on the Italian Telematic Stock Exchange therefore the company will reinstate the outstanding shares if, as a result of the above offer, it should exceed an equity interest of 90% in BIM share capital.

Separate management report • 237 FINANCIAL YEAR 2010

Business outlook

The expected economic and financial results of BancaI ntermobiliare are clearly influenced by the financial market trends: the first months of 2011 confirm the positive trend seen in the second half of the previous financial year, with particular reference to a regained client interest in riskier assets and trading and operating activities. Market conditions are favourable and seem to lead to a moderate increase in operating volumes. During the period, Banca Intermobiliare shall continue to develop its distribution network as well as important innovation projects for the range of products and services.

Project for allocating profit of the year

Dear Shareholders, We would like to submit to your attention the financial statements of 1st January-31stD ecember 2010 comprising the Balance Sheet, the Income Statement, the Statement of comprehensive income, the Statement of changes in equity, the Cash Flow Statement, the Notes to the Financial Statements and the Director’s Report. We recommend that you allocate the profit for the financial year at 31.12.2010 equal to €13,872,000.77 as follows:

- Reserve for undivided profits € 13,758,251.37 - Legal Reserve under art. 2430 of the Civil Code € 113,749.40

Turin 14 March 2011

For the Board of Directors Chairman

Prof. Roberto Ruozi SEPARATE MANAGEMENT REPORT

238 • Separate management report FINANCIAL YEAR 2010

SEPARATE FINANCIAL STATEMENTS AT 31 DECEMBER 2010

PARENT BANK’S FINANCIAL STATEMENTS FINANCIAL YEAR 2010

BALANCE SHEET (in euros)

Assets 31.12.2010 31.12.2009 10. Cash and cash equivalents 3,320,311 3,522,922 20. Financial assets held for trading 398,177,486 516,193,520 40. Financial assets available-for-sale 348,001,626 348,087,546 50. Financial assets held to maturity 5,626,660 5,550,908 60. Loans to banks 234,798,894 288,019,732 70. Loans to clients 1,903,527,463 1,764,610,631 100. Investments 148,591,044 148,186,115 110. Tangible assets 7,276,394 7,431,596 120. Intangible assets 1,850,094 2,208,850

of which: - goodwill - - 130. Tax assets a) current 5,036,887 2,532,329 b) prepaid 34,763,624 36,969,371 150. Other Assets 28,419,141 33,907,244 Total assets 3,119,389,624 3,157,220,764 PARENT BANK’S FINANCIAL STATEMENTS

240 • Parent bank’s financial statements FINANCIAL YEAR 2010

BALANCE SHEET (in euros)

Liabilities and equity items 31.12.2010 31.12.2009 10. Due to banks 560,570,594 529,030,545 20. Due to clients 1,572,898,545 1,760,834,552 30. Outstanding securities 421,565,558 367,641,952 40. Trading financial liabilities 149,349,136 85,999,556 80. Tax liabilities a) current 2,882,226 3,279,880 b) deferred 1,426,161 3,185,936 100. Other Liabilities 41,367,131 42,549,477 110. Staff severance provision 3,747,599 3,625,919 120. Provisions for liabilities and charges a) pensions and similar obligations - - b) other provisions 11,716,292 15,200,585 130. Valuation reserves (3,321,989) 2,500,111 150. Capital instruments 30,022,914 30,022,914 160. Reserves 191,499,912 191,580,722 170. Share premium - 139,779 180. Share capital 156,209,463 156,037,608 190. Treasury shares (-) (34,415,919) (33,801,567) 200. Profit (Loss) for the year (+/-) 13,872,001 (607,205) Total liabilities and equity 3,119,389,624 3,157,220,764 PARENT BANK’S FINANCIAL STATEMENTS

Parent bank’s financial statements • 241 FINANCIAL YEAR 2010

INCOME STATEMENT (in euros) Items 31.12.2010 31.12.2009 10. Interest income and similar items 58,969,531 72,612,374 20. Interest expense and similar items (32,163,268) (46,864,098) 30. Net interest income 26,806,263 25,748,276 40. Fee and commission income 61,097,700 54,622,429 50. Fee and commission expenses (18,818,437) (16,161,834) 60. Net fees and commissions 42,279,263 38,460,595 70. Dividends and similar income 9,744,508 1,280,117 80. Net result from trading activity 15,425,399 17,484,595 90. Net result from hedging activity - 553,108 100. Profit (loss) from disposal or repurchase of: a) loans 93,832 - b) available-for-sale financial assets 7,302,157 30,336,909 c) financial assets held to maturity - - d) financial liabilities (369,756) (339,854) 120. Net operating income 101,281,666 113,523,746 130. Net value adjustments /write-backs for impairment of: a) loans (4,385,435) (18,105,632) b) available-for-sale financial assets (1,050,145) (10,847,755) c) financial assets held to maturity - - d) other financial transactions 167,888 - 140. Net financial profit (loss) 96,013,974 84,570,359 150. Administrative overheads a) personnel costs (44,718,887) (45,047,061) b) other administrative overheads (27,514,093) (25,552,937) PARENT BANK’S FINANCIAL STATEMENTS 160. Net provisions for liabilities and charges (2,544,999) (10,639,624) 170. Net value adjustments /write-backs on tangible assets (2,123,116) (2,307,544) 180. Net value adjustments /write-backs on intangible assets (1,283,653) (1,282,766) 190. Other operating income/charges 1,019,618 1,021,933 200. Operating costs (77,165,130) (83,807,999) 210. Profit (Loss) of Investments 298,132 (58,844) 240. Profit (Loss) from investments disposal 995,871 - 250. Profit (Loss) of current operations before tax 20,142,847 703,516 260. Current operations income tax (6,270,846) (2,465,073) 270. Profit (Loss) of current operations after tax 13,872,001 (1,761,557) 280. Profit (Loss) of discontinued operations after tax - 1,154,352 290. Profit (Loss) for the year 13,872,001 (607,205)

242 • Parent bank’s financial statements FINANCIAL YEAR 2010

SE PArate STATEMENT OF COMPREHENSIVE INCOME AT 31.12.2010 (in €/‘000)

Items 2010 2009 10. Profit (Loss) for the year 13,872 (607) Other income components after tax 20. Available-for-sale financial assets (5,822) 12,588 110. Total other income components after tax (5,822) 12,588 120. Total profitability (Item 10+110) 8,050 11,981 PARENT BANK’S FINANCIAL STATEMENTS

Parent bank’s financial statements • 243 FINANCIAL YEAR 2010

SEPARATE STATEMENT OF CHANGES IN EQUITY FROM 31.12.2009 TO 31.12.2010 (in €/‘000)

Changes during the financial year Allocation previous financial Operations on equity year profit

Opening balance at 31.12.2009 Change in opening balance Opening balance at 01.01.2010 Reserves Dividends and other allocations Changes In Reserves Issue of new shares shares of treasury Purchase Extra dividend Change in capital instruments shares Derivatives of treasury Stock options year the for income comprehensive Total 31.12.2010 at Equity

Share capital:

a) ordinary shares 156,038 - 156,038 - - - 172 ------156,209 b) other shares ------Share premium 140 - 140 - - (140) ------Reserves: a) of profit 177,993 - 177,993 (607) - 140 - (157) - - - - - 177,369 b) other 13,588 - 13,588 ------543 - 14,131 Valuation reserves 2,500 - 2,500 ------(5,822) (3,322) Capital instruments 30,023 - 30,023 ------30,023 Treasury shares (33,802) - (33,802) - - - - (614) - - - - - (34,416) Profit (Loss) for the year (607) - (607) 607 ------13,872 13,872 Total equity 345,872 - 345,872 - - - 172 (771) - - - 543 8,050 353,866 PARENT BANK’S FINANCIAL STATEMENTS

244 • Parent bank’s financial statements FINANCIAL YEAR 2010

FROM 31.12.2008 TO 31.12.2009 (in €/‘000)

Changes during the financial year Allocation previous financial Operations on equity year profit

Opening balance at 31.12.2008 Change in opening balance Opening balance at 1.1.2009 Reserves Dividends and other allocations Changes In ReservesIn reserves Issue of new shares shares of treasury Purchase Extra dividend Change in capital instruments shares Derivatives of treasury Stock options year the for income comprehensive otal 31.12.2009 at Equity

Share capital: a) ordinary shares 155,773 - 155,773 - - - 265 ------156,038 b) other shares ------Share premium 140 - 140 ------140 Reserves: a) of profit 123,350 116,237 239,587 (62,283) - 1,374 - (685) - - - - - 177,993 b) other 129,200 (116,237) 12,963 ------625 - 13,588 Valuation reserves (10,088) - (10,088) ------12,588 2,500 Capital instruments 30,023 - 30,023 ------30,023 Treasury shares (30,227) - (30,227) - - - - (3,575) - - - - - (33,802) Profit (Loss) for the year (62,283) - (62,283) 62,283 ------(607) (607) Total equity 335,888 - 335,888 - - 1,374 265 (4,260) - - - 625 11,981 345,872 PARENT BANK’S FINANCIAL STATEMENTS

Parent bank’s financial statements • 245 FINANCIAL YEAR 2010

SE PARAte CASH FLOW STATEMENT (in €/‘000)

A. OPERATING ACTIVITIES 31.12.2010 31.12.2009 1. Management 12,313 36,794 - interest received (+) 49,271 89,711 - interest paid (-) (27,078) (63,963) - dividends and similar income (+) 2,929 1,280 - net fees and commissions (+/-) 42,280 38,460 - personnel costs (with the exception of provision for severance pay and shares) (-) (42,516) (41,543) - other costs (-) (31,377) (37,705) - other revenue (+) 18,804 49,400 - costs/revenue related to groups of assets held for disposal net of tax effect (+/-) - 1,154 2. Cash generated/absorbed by financial assets: 38,170 110,923 - financial assets held for trading 126,935 284,293 - available-for-sale financial assets (4,717) (104,667) - loans to clients (141,448) (172,394) - loans to banks: on demand 1,012 114,142 - loans to banks: other loans 53,675 (23,464) - other assets 2,713 13,013 3. Cash generated/absorbed by financial liabilities: (55,163) (180,611) - due to banks: on demand 57,643 36,632 - due to banks: other payables (26,887) 6,655 - due to clients (188,225) 74,474 - outstanding securities 49,912 335 - trading financial liabilities 63,349 (273,245) - other liabilities (10,955) (25,462) Net cash generated/used by operations (4,680) (32,894) PARENT BANK’S FINANCIAL STATEMENTS

246 • Parent bank’s financial statements FINANCIAL YEAR 2010

B. INVESTING ACTIVITIES 31.12.2010 31.12.2009 1. Cash generated by: 7,812 37,609 - disposal of investments 996 37,609 - dividends received on investments 6,816 - 2. Cash absorbed by: 2,892 553 - purchase of financial assets held to maturity - 29 - purchase of tangible assets 1,976 205 - purchase of intangible assets 925 319 Net cash generated/absorbed by investment activities 4,920 37,056

C. FUNDING ACTIVITIES - issue/purchase of treasury shares (614) (3,574) - issue/purchase of capital instruments 171 264 Net cash generated/absorbed by funding activities (443) (3,310) NET CASH GENERATED/ABSORBED DURING THE FINANCIAL YEAR (203) 852

RECONCILIATION

Amounts Amounts Items 31.12.2010 31.12.2009 Opening cash and cash equivalents 3,523 2,671 Net total cash generated/absorbed during the financial year (203) 852 Closing cash and cash equivalents 3,320 3,523 PARENT BANK’S FINANCIAL STATEMENTS

Parent bank’s financial statements • 247 FINANCIAL YEAR 2010 PARENT BANK’S FINANCIAL STATEMENTS

248 • Parent bank’s financial statements FINANCIAL YEAR 2010

SEPARATE FINANCIAL STATEMENTS AT 31 DECEMBER 2010

NOTES TO THE FINANCIAL STATEMENTS FINANCIAL YEAR 2010 Part A - ACCOUNTING POLICIES A.1 - GENERAL

Section 1 - Declaration of compliance with International Accounting Standards

The separate financial statements of Banca Intermobiliare were prepared by applying the International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) as approved by the European Commission on the basis of the procedure specified by EC Regulation No. 1606 of 19 July 2002 and as dictated by Italian Legislative Decree 38/05, as amended. In addition, the separate financial statements were prepared in accordance with the first update of 18 November 2009 of Circular No. 262 of 22 December 2005 issued by Bank of Italy which specifies the reporting formats and related methods for completing them, as well as the content of the notes to the financial statements. In addition, reference was made to documents prepared by the Italian Accounting Profession (O.I.C. - Organismo Italiano di Contabilità) and by the Italian Banking Association (ABI - Associazione Bancaria Italiana) in order to provide better guidance for the interpretation and application of the new accounting standards. The document was also prepared in accordance with Consob regulations.

Section 2 - General principles of preparation

The financial statements are made up of the balance sheet, the income statement, the statement of comprehensive income, the statement of changes in equity, the cash flow statement and the notes to financial statements and are accompanied by the directors’ report on operations. The financial statements were prepared using euros as the currency of account in accordance with the provisions of Article 5 of Italian Legislative Decree No. 38 of 28 February 2005. Unless otherwise indicated, amounts are expressed in thousands of euros. No exceptions were made to the application of IAS and IFRS. In addition to the amounts related to the reporting period, the financial statements and the notes to the financial statements include corresponding figures as at 31 December 2009 for comparison purposes. The report on operations and the notes to the financial statements provide the information required by International Accounting Standards, laws, Bank of Italy and Consob.

Section 3 - Events after the financial statement reporting date t Change in parent company Through an agreement for the merger by incorporation of Cofito (the controlling shareholder of Banca Intermobiliare) stipulated on 18 February 2011 and recorded in the Company Registers of Treviso and Turin on 25 February 2011, Veneto Banca S.c.p.a. acquired legal control of the Issuer Banca Intermobiliare.

NOTES TO THE FINANCIAL STATEMENTS - PART A Pursuant to Articles 102 and 106, paragraph 1 of the Consolidated Law on Finance (TUF), following this acquisition, the legal prerequisites were met for Veneto Banca S.c.p.a. to launch a mandatory takeover bid for the remaining outstanding BIM shares. The Offeror will pay to each Offer participant a cash amount equal to EUR 4.25 for each share surrendered to participate in the Offer. Veneto Banca intends to maintain the BIM shares listed on the Italian Telematic Stock Exchange and thus it will reinstate outstanding shares if, as a result of the above offer, it should exceed an equity interest of 90% in BIM share capital.

Going concern With reference to the assumption of the company being a going concern, in the report on operating performance and changes in the balance sheet and financial situation, directors did not indicate any situations that would cast a doubt

250 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010 on the ability of the company and its subsidiaries to continue normal operations. The balance sheet and the financial structure are suitable for ensuring operating continuity in the near future. Based on this reasonable expectation, the financial statements at 31 December 2010 were prepared with the expectation that the company is a going concern. .

Section 4 - Other aspects

Reclassification of equity investment in Immobiliare D S.r.l. Following the inability to meet the requirements dictated by IFRS 5, the comparative value in the financial statements at 31 December 2009 in the equity components of the subsidiary Immobiliare D S.r.l. was reclassified from the item “Non-current assets/liabilities and disposal groups held for sale” to the financial statement item “Equity investments.” The reclassification of these financial statement items had no impact on the income statement or shareholders’ equity. In the preparation of these financial statements, Banca Intermobiliare restated the balance sheet values at 31 December 2009 for the following financial statement items:

(Whole €) 31.12.2009 Reclassification 31.12.2009 Amount reclassified Assets 100. Equity Investments 148,186,015 100 148,186,115 140. Non-current assets and disposal groups held for sale 100 (100) -

Other reclassifications in the income statement With reference to the financial statements published at 31 December 2009, EUR 17,099,000 out of the balance of interest income were reclassified in order to report at closed balances the net difference between interest income and expense for derivative contracts. In addition, as a result of certain regulatory clarifications by Bank of Italy, EUR 964,000 out of certain charges for employee benefits (insurance policies and meal vouchers) were reclassified from “Other administrative expenses” to “Personnel costs.”

(Whole €) 2009 Reclassification 2009 Amount

reclassified NOTES TO THE FINANCIAL STATEMENTS - PART A Income statement 10. Interest income and similar items 89,710,898 (17,098,524) 72,612,374 20. Interest expense and similar charges (63,962,622) 17,098,524 (46,864,098) 150. Administrative expenses: a) personnel costs (44,083,251) (963,810) (45,047,061) b) other administrative expenses (26,516,747) 963,810 (25,552,937)

Notes to the Financial Statements - Part A • 251 FINANCIAL YEAR 2010

A.2 - INFORMATION ON THE MAIN ITEMS

Below is a description of the accounting principles used to prepare the IAS/IFRS separate financial statements at 31 December 2010; these standards did not change from the previous year. The presentation of the accounting principles applied is based on the classification, recording, valuation and removal of the various asset and liability items. Where relevant, a description of the related operating impact is provided for each of the above stages.

Section 1 - Financial assets held for trading

Classification criteria Only debt and equity securities and the positive value of derivative contracts held for trading are included in this category.

Recognition criteria When first identified, these financial assets, net of any transaction costs, are recorded in the balance sheet at fair value, usually corresponding to the amount paid to acquire them. They are recorded on the financial statements starting from the settlement date.

Criteria for valuation and recording of operating components Subsequently, financial assets held for trading are valued at fair value with an offset for changes posted to the income statement. To determine the fair value of financial instruments listed on an active market, market prices are used. In the absence of an active market, there are internal valuation models that take into account all risk factors related to the financial instruments. In particular, valuations are based on whether or not there are contributing factors from trading platforms, on volumes traded, on spreads applied or on other factors. Alternatively, there are valuation methods that are provided by key information sources and internal valuation methods based on the valuation of listed instruments with similar characteristics, of discounted cash flows or of values taken from recent transactions. Financial instruments for which it is not possible to determine fair value in a reliable manner were maintained at cost. Derivative financial instruments are reported in financial statements under assets if fair value is positive or under liabilities, if fair value is negative.

NOTA INTEGRATIVA INDIVIDUALE - PARTE A Derecognition criteria Financial assets are derecognised from the balance sheet only if their transfer resulted in the substantial transfer of all of their associated risks and benefits.

Section 2 - Financial assets available for sale

Classification criteria These are financial assets that cannot be classified as loans, receivables or financial assets held for trading or held until maturity. In particular, Banca Intermobiliare also includes in this item equities not qualified as controlled, linked or jointly controlled equity investments.

252 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010

Recognition criteria When first identified, these financial assets are recorded at fair value, usually corresponding to the amount paid to acquire them, in addition to any transaction costs that are directly attributable to such assets.

Criteria for valuation and recording of operating components Subsequently, the financial instruments classified in this category must be valued at fair value, with a balancing entry in equity reserve, until the financial asset is disposed of or impairment is recognised. At the time of disposal or any impairment, the equity reserve is reversed back to the income statement. If the reasons for impairment no longer apply, it is necessary to record a write-back, the impact of which is recorded in the income statement in the case of debt securities, or directly in the equity in the case of equity securities. The fair value of financial assets available for sale is determined on the basis of market prices, comparable transactions, and on valuation models based on multiples or discounted cash flow. Equity securities for which it is not possible to determine fair value in a reliable manner are maintained at cost.

Derecognition criteria Financial assets are derecognised from the balance sheet only if their transfer resulted in the substantial transfer of all of their associated risks and benefits.

Section 3 - Financial assets held to maturity

Classification criteria This category includes all investments held other than equity investments, with fixed payments, or payments that can be determined on a fixed maturity date and that the company intends, and is in a position to hold until maturity.

Recognition criteria Financial assets are recorded on their settlement date. On the date when first recorded, financial assets held to maturity are reported in the balance sheet at their fair value, which usually corresponds to the amount paid to acquire them.

Valuation criteria Subsequently, assets held to maturity are measured at amortised cost using the effective interest criterion.

Derecognition criteria Financial assets are derecognised from the balance sheet only at maturity, or on rare exceptions prior to their natural maturity, but in accordance with the provisions of IAS 39 in terms of exemption from the “tainting rule.” NOTES TO THE FINANCIAL STATEMENTS - PART A

Section 4 - Loans and receivables

Classification criteria This category includes direct loans to customers or banks that entail fixed or determined payments. These financial assets are not listed in an active market and from the outset are not classified under financial assets available for sale or under assets designated at fair value. This item includes trade payables, repo transactions, securities lending and current accounts at credit institutions.

Notes to the Financial Statements - Part A • 253 FINANCIAL YEAR 2010

Recognition criteria Receivables and loans are initially recorded at fair value, which usually corresponds to the amount disbursed including any directly attributable costs and income, net of disbursements.

Valuation criteria After initial recognition, loans are assessed at their amortised cost using the effective interest rate method. For loans made by Banca Intermobiliare, the absence of costs that are directly allocable to financial statement entries makes the impact of recording such entries using the amortised cost method negligible. The book value of receivables and loans is periodically subjected to impairment tests. Specific valuations are completed for all non-performing assets, as detailed in current Bank of Italy rules that are consistent with IAS regulations, and for all significant individual positions. The adjustment for exposure is equal to the difference between the book value at which the asset was recorded, and the present value of future cash flows discounted by applying the actual interest rate of the exposure. The projected cash flows take into account expected recovery periods, the estimated execution value of collateral and the legal costs to recover the loan. Performing loans and non-performing assets, for which a specific valuation has been carried out that did not identify any impairment, are measured collectively. The calculation model used by Banca Intermobiliare is an approximation of the approach introduced with the provisions of Basel II concerning the monitoring of the lending sector since there are significant similarities in the measurement of the risks inherent in loans under IAS/IFRS and the Basel rules. More specifically, similar loans were grouped by product type, with the parameters PD (probability of default) and LGD (loss given default) associated with each of these. In order to determine collective write-downs for loans, the Group utilised sector-based parameters. Specifically, Bank of Italy’s “decay rates” were used, with appropriate adjustments, where necessary, to take into account specific situations, as PD, while Basel percentages were used for LGD. Write-downs are recorded in the income statement, as are their related write-backs.

Derecognition criteria Loans are derecognised from the balance sheet if the transfer resulted in the substantial transfer of all loan-related risks and benefits, when contractual rights to receive the related cash flows have expired and in the event of impairment.

Section 5 - Financial assets designated at fair value Banca Intermobiliare has not required the adoption of the so-called “fair value option,” i.e., it has not taken advantage of the ability to designate at fair value any financial asset other than those for which IAS 39 requires the

NOTES TO THE FINANCIAL STATEMENTS - PART A application of the fair value criterion based on the specific functional use, with the recording of the result of the valuation in the income statement.

Section 6 - Hedging transactions

Risk hedge transactions are carried out to neutralise potential losses on a given element or group of elements attributable to a given risk in the event that the specific risk should actually arise. In 2010, Banca Immobiliare did not complete any transactions requiring hedge accounting.

254 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010

Section 7 - Equity investments Classification criteria Subsidiaries are considered to be those companies in which the Parent Company holds more than half of the voting rights, whether directly or indirectly, or in which the Parent Company has the power to appoint the majority of the directors or determine the financial and operating policies of the subsidiary, even if it has less than half of the voting rights. Associates, or companies subject to significant influence, are considered to be those companies in which the Parent Company holds at least 20% of voting rights or in which it has the power to participate in determining financial and management policies of the company owned.

Recognition criteria The initial recognition of the asset is on its settlement date. On initial recognition, equity interests are entered at cost including costs or income directly attributable to the transaction.

Valuation criteria Equity investments were maintained at cost adjusted for any impairment. If there is a loss in value of an equity investment, the recoverable value of the investment is assessed, taking into account the present value of future cash flows that may generate from the investment, including its final exit value. If the recoverable value is lower than the book amount, the difference between the two is recognised in the income statement. If the reasons for a loss of value should no longer exist as a result of an event occurring after recognition of the reduction in value, a write-back is performed and entered in the income statement.

Derecognition criteria Equity investments are derecognised from the balance sheet when contractual rights to cash flows deriving from the assets expire or when essentially all related risks and benefits are transferred along with a transferred equity investment.

Section 8 - Tangible fixed assets Classification criteria Tangible fixed assets include land, property, technical equipment, furniture, furnishings and equipment of any kind which is used in the Bank’s business, or to provide services or to be leased to third parties, and which is expected to be used for more than one financial period. This item also includes assets used under finance leases even though legal ownership of such assets remains with the lessor.

Recognition criteria NOTES TO THE FINANCIAL STATEMENTS - PART A Tangible assets are initially recorded at cost, which, in addition to the purchase price, includes any other ancillary charges directly attributable to the purchase and implementation of the asset. Extraordinary maintenance costs leading to an increase in future economic benefits are recorded as an increase in the asset value, whereas other ordinary maintenance costs are recorded in the income statement.

Criteria for valuation and recording of operating components Tangible assets and related improvement costs are assessed at cost less any depreciation or impairment. Depreciation is calculated on the basis of the useful life of the fixed assets on a straight-line basis. It should also be noted that under the new regulations, leasehold improvements fall under the scope of IAS 16 with reference to tangible assets when such costs are incremental in nature and have “materiality” characteristics, generate

Notes to the Financial Statements - Part A • 255 FINANCIAL YEAR 2010

future benefits and can be separated from the asset over which the company exercises control. The useful life of depreciable tangible assets is periodically tested. If there are adjustments to initial estimates, the related depreciation charges are also changed. On each financial statement reporting date, an assessment is performed to determine whether there are indications that the asset has been subject to a permanent loss in value. If it has, it is necessary to determine the asset’s recoverable value, i.e., the greater of the net sales price and usage value. If the assumptions that led to the recording of a permanent loss in value no longer apply, a write-back must be recorded in the income statement. Below are the depreciation rates that were used to prepare these financial statements bearing in mind that depreciation is calculated starting from the date the asset is put in operation.

Type of tangible asset Depreciation rate Buildings: - Property used for production purposes 2.2% Furniture: - Furniture 12% - Furnishings 12% Other: - Electronic office equipment 20% - Specific equipment 25% - Machinery and devices 15% - Armoured counters 20% - Vehicles 25% - Leasehold improvements 12.5%

Derecognition criteria Tangible assets are derecognised on the date of their disposal and when future economic benefits are no longer expected.

Section 9 - Intangible fixed assets

Classification criteria Intangible fixed assets consist of non-monetary assets that are identifiable, lack physical substance, are held to be used in the company’s operations and generate future economic benefits for the company. Examples of intangible assets are goodwill and software to be used over several years. Goodwill is the positive difference between purchase cost and the fair value of assets and liabilities acquired to reflect any potential surplus value of equity investments acquired. NOTES TO THE FINANCIAL STATEMENTS - PART A Criteria for recognition and recording of income components Intangible assets are recognised at cost, adjusted in terms of accessory charges only if it is likely that future economic benefits attributable to the asset will be realised and if the cost of the asset can be reliably determined. Otherwise, the cost of intangible assets is recognised in the income statement in the period in which it occurred. The cost of intangible assets is amortised on a straight line basis throughout its related useful life. If the useful life cannot be defined, no amortisation is carried out, and instead a periodic verification is performed to determine if the book value of assets is adequate. At the end of each financial period, if there is evidence of impairment, the recoverable value of the asset is estimated. The amount of the impairment, which is recorded in the income statement, is equal to the difference between the book value of the asset and the recoverable value. Goodwill may be recorded when the positive difference between the cost paid and the fair value of the net asset

256 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010 acquired is due to the future income-generating capacity of such asset. Since this is an asset with an indefinite useful life, it is not amortised. On an annual basis (or each time there is evidence of impairment) an impairment test is performed on the adequacy of the goodwill value. Any reduction in value is determined on the basis of the difference between the book value of goodwill and its recovery value, if lower. This recovery value is equal to the greater of the fair value, net of any sales costs, and the related value in use. The resulting adjustments are recorded in the income statement.

Write-off criteria

An intangible asset is derecognised from the balance sheet at the time of its disposal or when no future economic benefit can be expected.

Section 10 - Non-current assets held for sale

This item includes non-current assets/liabilities and groups of assets/liabilities that may be sold in the near future in their current condition and whose sale is considered highly likely. In particular, such assets/liabilities are measured at the lower of their book value and fair value net of sales costs. As operating elements that have been shut down, these assets, and the related charges and income (net of taxes) are reported in the balance sheet and income statement in separate items.

Section 11 - Current and deferred taxes

Banca Intermobiliare recognises the impact of current taxes by applying tax regulations and tax rates in effect at the time the financial statements are prepared. Deferred taxes are calculated on the basis of tax provisions and rates, which, based on the provisions and rates in effect on the date the financial statements are prepared, will be applicable in future periods in which the temporary differences will be relevant for tax purposes. Income taxes are recorded in the income statement and consist of the balance between current and deferred taxes. Deferred tax assets and liabilities related to transactions affecting the income statement are recognised as an offset in the income statement. However, deferred tax assets and liabilities related to transactions affecting shareholders’ equity are recognised as an offset in shareholders’ equity with reference to specific reserves. The provision for income tax is determined on the basis of a prudent forecast of the current, the prepaid and the deferred tax burden. In particular, prepaid and deferred taxes are calculated on the basis of temporary differences between the attributed value of an asset or liability according to statutory criteria and the corresponding values assumed for tax purposes. Deferred tax assets are generated by deductible temporary differences or by income components, which, for the NOTES TO THE FINANCIAL STATEMENTS - PART A applicable period, are not recognised for tax purposes, therefore resulting in higher taxable income, and at the same time generating lower taxes in future periods. Deferred tax assets are only recognised when it is likely that there will be taxable income in the period when such temporary differences will be deductible. Deferred tax liabilities are generated by taxable temporary differences or by income components, which, for the applicable period, are not recognised for tax purposes, therefore resulting in lower taxable income, and at the same time generating higher taxes in future periods. Assets and liabilities recorded for deferred taxes are regularly assessed to take into account any changes in tax regulations and tax rates.

Notes to the Financial Statements - Part A • 257 FINANCIAL YEAR 2010

Section 12 - Provisions for risks and charges

Classification criteria Provisions for risks and charges include allocations made to cover current liabilities resulting from past events for which probable future disbursements of cash were determined. In addition, it must be possible to determine these disbursements using a reliable estimate.

Recognition and valuation criteria The amount recognised is equal to the best estimate of the liability that Banca Intermobiliare will incur, taking into account the future time when such liabilities will generate any significant actual cash disbursement. The amounts allocated by Banca Intermobiliare are related to client claims and disputes for which a resolution is not anticipated during the year. The funds allocated are reviewed on each reporting date and adjusted to reflect the best current estimate. The allocation was discounted using current market rates and recognised in the income statement.

Derecognition criteria The funds allocated are written off when the previously estimated liability is eliminated.

Section 13 - Payables and outstanding securities

Classification criteria This item includes payables to banks, payables to customers, issued and outstanding securities and financial statement entries incorporating the various forms of interbank and customer deposits. Outstanding securities consisting of bonds issued by the Bank, are reported in the financial statements net of any portion repurchased. Payables to customers also include payables to leasing companies in connection with finance lease transactions.

Recognition and valuation criteria When first recorded in the financial statements, payables and outstanding securities are measured at their fair value, plus any transaction costs, which represents the amount collected. Payables with a short-term maturity are maintained at nominal value. Long-term payables and issued bonds with transaction costs are measured at amortised cost using the effective interest rate method. Purchases and sales of securities issued by the Bank constitute redemptions and new issues of its own securities. The value of new issues is equal to the new placement price with no impact from the transaction on the income statement. Derivative components embedded in bonds issued by the Bank were separated. NOTES TO THE FINANCIAL STATEMENTS - PART A For convertible bonds, the derivative was separated and reported under “Equity instruments,” and subsequently measured at cost. For structured bonds with underlying assets other than own shares, embedded derivatives were classified under liabilities held for trading and subsequently designated at their fair value if the prerequisites of IAS 39 were met.

Derecognition criteria These liabilities are derecognised from the balance sheet only when they expire or are redeemed. The difference between the book value of the liability and the amount paid as a repurchase is recorded in the income statement. The replacement of own shares on the market after their repurchase is considered a new issue with recognition at the new placement price.

258 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010

Section 14 - Financial liabilities held for trading

Classification criteria This item includes the negative value of trading derivative contracts, the negative value of embedded derivative contracts separated from bonds issued by the Parent Company and liabilities resulting from technical exposures generated from trading activity.

Recognition and valuation criteria Financial liabilities held for trading are measured using the same criteria applied to financial assets held for trading and thus reference should be made to comments made above.

Derecognition criteria Financial liabilities are written off only if their transfer resulted in the substantial transfer of all of their associated risks and benefits.

Section 15 - Financial liabilities designated at fair value

See the comments in Section 5 “Financial assets designated at fair value” in this section.

Section 16 - Foreign currency transactions

Recognition criteria Transactions in foreign currency are recorded, at the time of their initial recognition, in the accounting currency, applying the foreign currency exchange rate valid on the transaction date.

Criteria for valuation and recording of income components Monetary elements in foreign currency are converted using the rate at the end of the period. Non-monetary elements, which are measured at historical cost in foreign currency, are converted using the exchange rate in effect on the date of the transaction. Non-monetary elements designated at fair value in a foreign currency are converted using the exchange rates on the date on which fair value was determined. Exchange differences deriving from monetary element settlements or from conversions to rates different from the original rates applied or from conversions of the previous financial statements are recorded in the income statement NOTES TO THE FINANCIAL STATEMENTS - PART A in the period in which they arise. When profit or loss relating to a non-monetary element is recorded under shareholders’ equity, any exchange difference relating to that element is also recorded under shareholders’ equity. Otherwise, when a profit or loss is recorded in the profit and loss account, any related exchange difference is also recorded in the income statement.

Section 17 - Other information

Treasury shares Any treasury share held is recorded as a reduction in shareholders’ equity. If they are sold on the market, the

Notes to the Financial Statements - Part A • 259 FINANCIAL YEAR 2010

difference between the purchase and sale price is recorded under the components of shareholders’ equity.

Share-based payments Payments based on equity instruments issued to employees and other parties that provide services to Group companies are settled with shares of Group companies. These transactions are measured in accordance with IFRS 2 and the interpretations of IFRIC 11 which require the identification of the cost at the time the goods or services are consumed, resulting in an increase in shareholders’ equity in an amount equal to the fair value of the compensation on the allocation date (in the event of equity-settled share-based transactions) or the recording of a liability at the current value on the reporting date (in the event of cash-settled share-based transactions)..

Recognition of costs and revenues Revenues are recorded in the income statement in the periods in which the related costs are reported. Income from fees and commission and from other services is recorded in the financial statements in the periods in which the services were rendered. Other income is recorded in the financial statements according to the accrual principle.

Employees’ severance fund Following the pension reform implemented under Law No. 296 of 27 December 2006, it is essential, for accounting purposes, to distinguish between the amount of the employees’ severance fund accrued up to 31 December 2006 and the amount accrued starting 1 January 2007 (the effective date of the reform). The employees’ severance fund accrued starting 1 January 2007 is treated as a defined contribution plan (the company’s obligation to employees is fulfilled with its payment of contributions to supplemental pension funds). Based on the above, the company: • records the obligation for amounts accrued to 31 December 2006, according to the rules for defined benefit plans, using actuarial procedures. Actuarial gains and losses continue to be recorded at the end of the period in the income statement (without using the corridor approach); • records the obligation for amounts accruing from 1 January 2007 and owed to supplemental pension funds on the basis of contributions due each period (in this case, it is not necessary to report actuarial assumptions or discount the obligation since it matures in less than 12 months); • records the obligation for amounts accruing from 1 January 2007 that remain in the company and are added to the amounts accrued to 31 December 2006.

Valuation reserves Valuation reserves are determined as a function of valuation rules indicated for the assets and liabilities concerned, e.g., assets available for sale and stock options. These reserves also include the impact from the first application of IAS. NOTES TO THE FINANCIAL STATEMENTS - PART A NOTES TO THE FINANCIAL STATEMENTS - PART A This item includes valuation reserves for financial assets available for sale and for tangible and intangible assets revalued at the time of the first application of IAS/IFRS.

Use of estimates and assumptions in the preparation of financial statements In the preparation of financial statements, Banca Intermobiliare, through its management and/or outside contractors, used estimates and assumptions to calculate balance sheet and income statement entries that entailed the processing and interpretation of available information, and thus, assessments that may be more or less subjective in nature. The main analyses that require subjective assessments are the following: • The assessment of the recoverable value of loans, also by means of assessing collateral or other financial assets (e.g., the measurement of fair value of unlisted financial instruments) and thus the related losses due to impairment;

260 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010

• The assessment of the sustainability of the value of goodwill and intangible assets; • Quantifying provisions for staff and provisions for risks and charges; • The recoverability of deferred tax assets; • The allocation of acquisition costs within the scope of IFRS 3.

Impairment of financial instruments On each reporting date, the financial assets not classified as “Financial assets held for trading” are subject to impairment tests in order to determine if their book value is fully recoverable.

With specific reference to financial assets available for sale, a decrease in fair value below the acquisition cost of the financial instrument is to be considered objective evidence of impairment if the reduction in value is significant or long-lasting. In this situation, any accumulated losses during the period or negative shareholders’ equity reserves must be recorded in the income statement. If in future periods the preconditions for write-backs can be met, the write-backs for equity securities and undertakings for collective investment (UCIs) are recorded under shareholders’ equity reserves, while those related to debt securities are recorded in the income statement. In order to recognise any evidence of impairment, Banca Intermobiliare takes into consideration all qualitative information about the issuer that could lead to loss events, highlighted by IAS 39, §59-60, and quantitative information concerning the decrease in fair value of the financial instrument compared to acquisition cost. With reference to the latter, the Banca Intermobiliare Group has established an internal policy aimed at identifying cases in which a decrease in fair value must be considered significant or long-lasting. On the one hand, the criteria used call for the direct allocation of adjustments to the income statement for losses greater than 60% of the total value, or losses that last for a period of over 48 months. On the other hand, they call for the use of control filters and other qualitative and fundamental analyses, as required for securities which show no signs of impairment, but still reflect a loss in value of over 30% of book value.

A.3 - INFORMATION ON FAIR VALUE

A.3.1 Transfers between portfolios

A.3.1.1 Reclassified financial assets: book value, fair value and impact on comprehensive income Banca Intermobiliare has taken advantage of the option provided by the amendment to IAS 39 to reclassify, no later than 31 October 2008, part of its financial assets (excluding derivatives) from “Financial assets held for trading” (Hft) to “Financial assets held to maturity” (Htm) and “Financial assets available for sale” (Afs). Below is the information required by the first update to Bank of Italy Circular 262 and the information required by IAS 39 and

IFRS 7. NOTES TO THE FINANCIAL STATEMENTS - PART A

Nota Integrativa Individuale - Parte A • 261 FINANCIAL YEAR 2010

Income components Income components reported Type Source Target Book value Fair value with no transfer during the financial period of financial portfolio portfolio at 31.12.2010 at 31.12.10 (before taxes) (before taxes) instrument Valuation Other Valuation Other Debt securities Hft L&R 40,576 40,550 (119) 622 x 1,154 Hft Afs 49,741 49,623 205 1,407 205 1,766 Hft Htm 5,627 5,670 19 55 x 131 UCI units Hft Afs 47,252 47,252 345 244 345 244 Equity securities Hft Afs 564 564 (48) 864 (48) 864 143,760 143,659 402 3,192 502 4,159

A.3.1.2 Reclassified financial assets: impact on comprehensive income before transfer In 2010 no reclassifications were performed in accordance with the amendment to IAS 39 and IFRS 7.

A.3.1.3 Transfer of financial assets held for trading Not applicable, see paragraph A.3.1.2.

A.3.1.4 Effective interest rate and projected cash flows from reclassified assets Not applicable, see paragraph A.3.1.2.

A.3.2 Fair value hierarchy Fair value is defined as the price for which an asset can be exchanged or a liability settled between knowledgeable and willing parties in a transaction between unrelated parties. Following the revision to IFRS 7, § 27, in order to ensure more complete information on the degree of discretion in the valuation of financial instruments reported in the financial statements, a ranking of the methods used to determine fair value was developed. Three pricing methodologies were defined and ranked on a hierarchical scale: 1) Prices in active markets: official, or operational, prices (in the case of contributors) available in active markets take priority for the determination of fair value. 2) Pricing models with market parameters: in the absence of an active market, the instrument must be valued by loading pricing models with input data available directly and indirectly on the market (rates, credit spreads, etc.). 3) Pricing models with estimated parameters: the final level is based on the determination of fair value using estimates and assumptions for data not available from the market. NOTES TO THE FINANCIAL STATEMENTS - PART A

262 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010

A.3.2.1 Accounting portfolios: breakdown by fair value levels

(Thousands of €) - 31 December 2010 Financial assets/liabilities designated at fair value Level 1 Level 2 Level 3 Total 1. Financial assets held for trading 204,460 132,345 61,372 398,178 2. Financial assets designated at fair value - - - - 3. Financial assets available for sale 259,544 5,654 82,804 348,002

4. Hedging derivatives - - - - Total 464,004 137,999 144,176 746,180 1. Financial liabilities held for trading 32,099 113,307 3,943 149,349 2. Financial liabilities designated at fair value - - - - 3. Hedging derivatives - - - - Total 32,099 113,307 3,943 149,349

(Thousands of €) - 31 December 2009 Financial assets/liabilities designated at fair value Level 1 Level 2 Level 3 Total 1. Financial assets held for trading 331,510 99,644 85,040 516,194 2. Financial assets designated at fair value - - - - 3. Financial assets available for sale 250,011 22,524 75,553 348,088 4. Hedging derivatives - - - - Total 581,521 122,168 160,593 864,282 1. Financial liabilities held for trading 8,382 77,193 425 86,000 2. Financial liabilities designated at fair value - - - - 3. Hedging derivatives - - - - Total 8,382 77,193 425 86,000 NOTES TO THE FINANCIAL STATEMENTS - PART A

Notes to the Financial Statements - Part A • 263 FINANCIAL YEAR 2010

A.3.2.2 Annual changes in financial assets designated at fair value (level 3)

FINANCIAL ASSETS Held for Designated at Available Hedging (Thousands of €) trading fair value for sale 1. Opening balance 85,040 - 75,553 - 2. Increases 53,876 - 29,597 - 2.1 Purchases 28,427 - 25,418 - 2.2 Profits allocated to: 2.2.1 Income statement 268 - - - - Of which: Capital gains 268 - - - 2.2.2 Shareholders' equity x x 1,407 x 2.3 Transfers from other levels 25,148 - - - 2.4 Other increases 33 - 2,772 - 3. Decreases (77,544) - (22,346) - 3.1 Sales (1,550) - (17,001) - 3.2 Repayments (72,472) - (3,010) - 3.3 Losses allocated to: 3.3.1 Income statement (83) - - - - Of which: Capital losses (83) - - - 3.3.2 Shareholders' equity x x (2,335) x 3.4 Transfers to other levels (3,238) - - - 3.5 Other decreases (201) - - - 4. Net closing balance 61,372 - 82,804 - NOTES TO THE FINANCIAL STATEMENTS - PART A

264 • Notes to the Financial Statements - Part A FINANCIAL YEAR 2010

A.3.2.3 Annual changes in financial liabilities designated at fair value (level 3)

FINANCIAL LIABILITIES Held for Designated Hedging (Thousands of €) trading at fair value 1. Opening balance 425 - - 2. Increases 3,535 - -

2.1 Issues 1,590 - - 2.2 Losses allocated to: - - - 2.2.1 Income statement 1,280 - - - Of which: Capital losses 1,280 - - 2.2.2 Shareholders' equity x x x 2.3 Transfers from other levels 665 - - 2.4 Other increases - - - 3. Decreases (17) - - 3.1 Repayments (17) - - 3.2 Repurchases - - - 3.3 Profits allocated to: - - - 3.3.1 Income statement - - - - Of which: Capital gains - - - 3.3.2 Shareholders' equity x x x 3.4 Transfers to other levels - - - 3.5 Other decreases - - - 4. Net closing balance 3,943 - -

A.3.3 Information on “day one profit/loss” At the time of the initial recognition of financial instruments traded in non-active markets, no differences were found between the transaction price and its fair value using the valuation techniques described in Part E of the notes to the consolidated financial statements. NOTES TO THE FINANCIAL STATEMENTS - PART A

Notes to the Financial Statements - Part A • 265 FINANCIAL YEAR 2010 Part B - INFORMATION ON THE BALANCE SHEET

ASSETS

Section 1 - Cash and cash equivalents - Item 10 1.1 Cash and cash equivalents: breakdown

2010 2009 a) Cash 3,320 3,523 b) Demand deposits at central banks - Total 3,320 3,523

Section 2 - Financial assets held for trading - Item 20

2.1 Financial assets held for trading: breakdown by type

Items/Amounts 2010 2009 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 A. Non-derivative assets 1. Debt securities 1.1 Structured securities 3,446 4,500 8,319 4,696 6,945 6,679 1.2 Other debt securities 160,212 14,501 51,454 314,007 16,496 76,522 2. Equity securities 15,036 - 1,396 9,180 - 1,629 3. UCI units - - - 3,102 - - 4. Loans 4.1 Repurchase agreements ------4.2 Other ------Total A 178,694 19,001 61,169 330,985 23,441 84,830 B. Derivatives 1. Financial derivatives: NOTA INTEGRATIVA INDIVIDUALE - PARTE B 1.1 Held for trading 25,766 112,531 203 525 75,546 210 NOTES TO THE FINANCIAL STATEMENTS - PART B NOTES TO THE FINANCIAL STATEMENTS - PART B 1.2 Connected with fair value option ------1.3 Other ------2. Credit derivatives 2.1 Held for trading - 813 - - 657 - 2.2 Connected with fair value option ------2.3 Other ------Total B 25,766 113,344 203 525 76,203 210 Total (A+B) 204,460 132,345 61,372 331,510 99,644 85,040

266 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

2.2 Financial assets held for trading: breakdown by borrower/issuer

Items/Amounts 2010 2009 A. NON-DERIVATIVE ASSETS 1. Debt securities a) Governments and central banks 10,899 35,292

b) Other government authorities 65 47 c) Banks 198,703 254,220 d) Other issuers 32,765 135,786 2. Equity securities a) Banks 707 1 b) Other issuers - Insurance Companies 2,220 1,322 - Financial companies 198 2 - Non-financial companies 13,307 9,484 - Other - - 3. UCI units - 3,102 4. Loans a) Governments and central banks - - b) Other government authorities - - c) Banks - - d) Other entities - - Total A 258,864 439,256 B. DERIVATIVES a) Banks - Fair value 44,050 20,038 b) Clients - Fair value 95,263 56,900 Total B 139,313 76,938 Total (A+B) 398,177 516,194 NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 267 FINANCIAL YEAR 2010

2.3 Non-derivative financial assets held for trading: annual changes

Debt Equity UCI Loans Total

securities securities units A. Opening balance 425,345 10,809 3,102 - 439,256 B. Increases B1. Purchases 1,554,457 165,687 3,903 - 1,724,047 B2. Increases in fair value 1,216 781 - - 1,997 B3. Other changes 7,897 25,382 57 - 33,336 C. Decreases C1. Sales (1,467,033) (169,297) (7,062) - (1,643,392) C2. Repayments (260,000) (1,484) - - (261,484) C3. Decreases in fair value (2,123) (1,216) - - (3,339) C4. Transfers to other portfolios - - - - - C5. Other changes (17,327) (14,230) - - (31,557) D. Net closing balance 242,432 16,432 - - 258,864

Section 4 - Financial assets available for sale - Item 40

4.1 Financial assets available for sale: breakdown by type

Items/Amounts 2010 2009 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 1. Debt securities 1.1 Structured securities 20,427 - 41,875 15,240 813 40,839 1.2 Other debt securities 150,974 5,654 25,223 165,710 21,711 8,238 2. Equity securities 2.1 Designated at fair value 35,577 - 3,494 17,333 - 18,209 NOTA INTEGRATIVA INDIVIDUALE - PARTE B 2.2. At cost - - 2,822 - - 67 NOTES TO THE FINANCIAL STATEMENTS - PART B NOTES TO THE FINANCIAL STATEMENTS - PART B 3. UCI units 52,566 - 9,390 51,728 8,200 4. Loans ------Total 259,544 5,654 82,804 250,011 22,524 75,553

268 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

4.2 Financial assets available for sale: breakdown by borrower/issuer

Items/Amounts 2010 2009 1. Debt securities a) Governments and central banks 61,967 98,017 b) Other government authorities 992 987

c) Banks 146,886 108,813 d) Other issuers 34,308 44,734 2. Equity securities a) Banks 169 16,741 b) Other issuers: - Insurance Companies 1,442 31 - Financial companies 5,862 12,288 - Non-financial companies 34,419 6,549 - Other - - 3. UCI units 61,956 59,928 4. Loans a) Governments and central banks - - b) Other government authorities - - c) Banks - - d) Other issuers - - Total 348,002 348,088

4.3 Financial assets available for sale covered by specific hedges As at 31 December 2010 no financial asset available for sale was covered by a specific hedge. NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 269 FINANCIAL YEAR 2010

4.4 Financial assets available for sale: annual changes

Debt securities Equity UCI units Loans Total securities A. Opening balance 252,551 35,609 59,928 - 348,088 B. Increases B1. Purchases 127,180 66,971 1,462 - 195,613 B2. Increases in fair value 1,523 1,041 1,683 - 4,247 B3. Write-backs - Allocated to the income statement ------Allocated to shareholders' equity - - - - - B4. Transfers from other portfolios - - - - - B5. Other changes 8,362 5,999 - - 14,361 C. Decreases C1. Sales (62,753) (62,162) (674) - (125,589) C2. Repayments (71,031) - - - (71,031) C3. Decreases in fair value (4,074) (3,449) (411) - (7,934) C4. Write-downs due to impairment - Allocated to the income statement - (1,059) - - (1,059) - Allocated to shareholders' equity - - - - - C5. Transfers to other portfolios - - - - - C6. Other changes (7,605) (1,057) (32) - (8,694) D. Net closing balance 244,153 41,893 61,956 - 348,002 NOTA INTEGRATIVA INDIVIDUALE - PARTE B NOTES TO THE FINANCIAL STATEMENTS - PART B

270 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

Section 5 - Financial assets held to maturity - Item 50

5.1 Financial assets held to maturity: breakdown by type

2010 2009 Type Fair value Fair value of transaction/ Book Book Amounts value Level 1 Level 2 Level 3 value Level 1 Level 2 Level 3 1. Debt securities - Structured 5,627 5,670 - - 5,551 5,610 - - - Other ------2. Loans ------Total 5,627 5,670 - - 5,551 5,610 - -

5.2 Financial assets held to maturity: breakdown by borrower/issuer

Type of transaction/Amounts 2010 2009 1. Debt securities a) Governments and central banks - - b) Other government authorities - - c) Banks 5,627 5,551 d) Other issuers - - 2. Loans a) Governments and central banks - - b) Other government authorities - - c) Banks - - d) Other entities - - Total 5,627 5,551

5.3 Financial assets held to maturity covered by specific hedges

NOTES TO THE FINANCIAL STATEMENTS - PART B As at 31 December 2010 no financial asset held to maturity was covered by a specific hedge.

Notes to the Financial Statements - Part B • 271 FINANCIAL YEAR 2010

5.4 Financial assets held to maturity: annual changes

Debt securities Loans Total A. Opening balance 5,551 - 5,551 B. Increases B1. Purchases - - - B2. Write-backs - - - B3. Transfers from other portfolios - - - B4. Other changes 117 - 117 C. Decreases C1. Sales - - - C2. Repayments - - - C3. Write-downs - - - C4. Transfers to other portfolios - - - C5. Other changes (41) - (41) D. Net closing balance 5,627 - 5,627

Section 6 - Loans to banks - Item 60

6.1 Loans to banks: breakdown by type

Type of transaction/Amounts 2010 2009 A. Loans to central banks 1. Term deposits - - 2. Reserve requirements 10,590 7,674 3. Repurchase agreements - - 4. Other - - B. Loans to banks 1. Current accounts and demand deposits 62,399 123,434 2. Term deposits 44,951 9,227 3. Other loans:

3.1 Repurchase agreements 10,099 8,305 NOTA INTEGRATIVA INDIVIDUALE - PARTE B

NOTES TO THE FINANCIAL STATEMENTS - PART B 3.2 Finance leases - - 3.3 Other 41,448 34,540 4. Debt securities 4.1 Structured securities 30,310 70,173 4.2 Other debt securities 35,002 34,667 Total (book value) 234,799 288,020 Total (fair value) 233,786 288,552

272 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

6.2 Loans to banks covered by specific hedges Not applicable.

6.3 Finance leases

Not applicable.

Section 7 - Loans to clients - Item 70

7.1 Loans to clients: breakdown by type

Type of transaction/Amounts 2010 2009 Performing Non-performing Performing Non-performing 1. Current accounts 930,665 144,340 828,435 184,396 2. Repurchase agreements 7,020 - 2,660 - 3. Mortgages 458,957 26,264 334,151 137,180 4. Credit cards, personal loans and loans secured by one-fifth of salary - - - - 5. Finance leases - - - - 6. Factoring - - - - 7. Other transactions 323,597 7,190 262,676 4,864 8. Debt securities - - 8.1 Structured securities - - - - 8.2 Other debt securities 5,494 - 10,249 - Total (book value) 1,725,733 177,794 1,438,171 326,440 Total (fair value) 1,725,768 177,794 1,438,406 326,440 NOTA INTEGRATIVA INDIVIDUALE - PARTE B NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 273 FINANCIAL YEAR 2010

7.2 Loans to clients: breakdown by borrower/issuer

Type of transaction/Amounts 2010 2009 Performing Non-performing Performing Non-performing 1. Debt securities issued by: a) Governments - - - - b) Other government authorities - - - - c) Other issuers - - - Non-financial companies 2,920 - 2,884 - - Financial companies 2,574 - 7,365 - - Insurance companies - - - - - Other - - - - 2. Loans to: a) Governments - - - - b) Other government authorities - - - - c) Other entities - - - Non-financial companies 901,485 156,977 705,755 270,694 - Financial companies 256,847 2,095 219,665 33,880 - Insurance companies - - - - - Other 561,907 18,722 502,502 21,866 Total 1,725,733 177,794 1,438,171 326,440

7.3 Loans to clients covered by specific hedges Not applicable.

7.4 Finance leases Not applicable. NOTES TO THE FINANCIAL STATEMENTS - PART B

274 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

Section 10 - Equity investments - Item 100

10.1 Investments in subsidiaries, joint investments in subsidiaries and investments in companies subject to significant influence: information on equity investments

Company name Head office Amount of equity % votes

investment % available A. Investments in 100% owned subsidiaries Symphonia SGR S.p.A. Milan 100% 100% Banca Ipibi S.p.A. Milan 67.283% 67.283% Bim Intermobiliare di Investimenti e Gestioni (Suisse) S.A. Lugano 100% 100% Bim Immobiliare S.r.l. Turin 100% 100% Bim Fiduciaria S.p.A. Turin 100% 100% Bim Insurance Brokers S.p.A. Turin 51% 51% Immobiliare D S.r.l. Turin 100% 100% B. Joint investments in subsidiaries C. Companies subject to significant influence Bim Vita S.p.A. Turin 50% 50% NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 275 FINANCIAL YEAR 2010

10.2 Investments in subsidiaries, joint investments in subsidiaries and investments in companies subject to significant influence: accounting information

Company name Total Total Profit Shareholders' Book Fair assets revenues (Loss) Equity value value A. Investments in 100% owned subsidiaries Symphonia SGR S.p.A. 79,427 49,834 6,189 52,694 76,124 x Banca Ipibi S.p.A. 222,807 22,606 (2,292) 13,997 39,319 x Bim Intermobiliare di Investimenti e Gestioni (Suisse) S.A. 99,497 6,774 82 34,030 24,714 x Bim Fiduciaria S.p.A. 1,161 730 47 924 465 x Bim Immobiliare S.r.l. 84,305 3,519 298 20,357 2,469 x Bim Insurance Brokers S.p.A. 1,045 1,118 158 396 61 x Immobiliare D S.r.l. 34,303 246 (624) (331) - x B. Joint investments in subsidiaries C. Companies subject to significant influence Bim Vita S.p.A. 282,165 138,034 54 11,900 5,439 n.a. Total 804,710 222,861 3,912 133,967 148,591 -

The amounts reported for Bim Suisse are figures from the consolidated financial statements that were restated in ac- cordance with IAS/IFRS and converted to euros on the reporting date. The figures for the equity investment in Bim Vita, which is subject to significant influence, are reported at 100%. As per Bank of Italy instructions, the revenue column corresponds to the total of positive income components and the shareholders’ equity column indicates the total amount of net profit for the period.

10.3 Equity investments: annual changes

2010 2009 A. Opening balance 148,186 184,700 B. Increases B.1 Purchases - B.2 Write-backs 298 - B.3 Revaluations - - B.4 Other changes 107 -

NOTES TO THE FINANCIAL STATEMENTS - PART B C. Decreases C.1 Sales - - C.2 Write-downs - (59) C.3 Other changes (36,455) D. Net closing balance 148,591 148,186 E. Total revaluations - - F. Total adjustments (11,527) (11,884)

The write-backs are for the revaluation of the equity investment in Bim Immobiliare S.r.l., which is equal to net profit for the year..

276 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

10.4 Commitments related to investments in subsidiaries Not applicable.

10.5 Commitments related to joint investments in subsidiaries Not applicable.

10.6 Commitments related to investments in companies subject to significant influence Not applicable.

Section 11 - Tangible fixed assets - Item 110

11.1 Tangible fixed assets: breakdown of assets carried at cost

Assets/Amounts 2010 2009 A. Assets for operating use 1.1 Owned assets a) Land - - b) Buildings - - c) Furniture 1,284 1,349 d) Electronic systems 1,342 839 e) Other 494 749 f) Leasehold improvements 4,156 4,495 1.2 Held under finance leases a) Land - - b) Buildings - - c) Furniture - - d) Electronic systems - - e) Other - - Total A 7,276 7,432 B. Assets held for investment purposes 2.1 Owned assets a) Land - - NOTES TO THE FINANCIAL STATEMENTS - PART B b) Buildings - - 2.2 Held under finance leases a) Land - - b) Buildings - - Total B - - Total (A + B) 7,276 7,432

There were no permanent losses in value or reversals affecting tangible fixed assets.

Notes to the Financial Statements - Part B • 277 FINANCIAL YEAR 2010

11.2 Tangible fixed assets: breakdown of assets designated at fair value or revalued Not applicable.

11.3 Tangible assets for operating use: annual changes

Land Buildings Furniture Electronic Other Leasehold Total

systems improvements A. Gross opening balance - - 5,674 3,706 5,573 16,057 31,010 A.1 Net total of write-downs - - (4,325) (2,867) (4,824) (11,562) (23,578) A.2 Net opening balance - - 1,349 839 749 4,495 7,432 B. Increases: B.1 Purchases - - 209 - 32 460 701 B.2 Capitalised improvement costs ------B.3 Write-backs ------B.4 Increases in fair value allocated to - - - - a) shareholders’ equity ------b) income statement ------B.5 Positive exchange differences ------B.6 Transferred from property held for investment purposes ------B.7 Other changes - - 32 1,115 77 171 1,395 C. Decreases: C.1 Sales - - (6) (123) - - (129) C.2 Depreciation - - (300) (489) (364) (970) (2,123) C.3 Write-downs for impairment allocated to - - - - a) shareholders’ equity ------b) income statement ------C.4 Decreases in fair value allocated to: - - - - a) shareholders’ equity ------b) income statement ------C.5 Negative exchange differences ------C.6 Transfers to: - - - -

NOTES TO THE FINANCIAL STATEMENTS - PART B NOTES TO THE FINANCIAL STATEMENTS - PART B a) tangible assets held for investment purposes ------b) assets held for sale ------C.7 Other changes ------D. Net closing balance - - 1,284 1,342 494 4,156 7,276 D.1 Net total of write-downs - - (4,045) (6,721) (122) (10,420) (21,308) D.2 Gross closing balance - - 5,329 8,063 616 14,576 28,584 E. Valuation at cost - - 1,284 1,342 494 4,156 7,276

278 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

11.4 Tangible assets held for investment purposes: annual changes Not applicable.

11.5 Commitments to purchase tangible fixed assets

As at 31 December 2010, there were no commitments to purchase tangible assets of any significant amount.

Section 12 - Intangible fixed assets - Item 120

12.1 Intangible fixed assets: annual changes

Assets/Amounts 2010 2009 Defined life Undefined life Defined life Undefined life A.1 Goodwill x - x - A.2 Other intangible assets - - - - A.2.1 Assets carried at cost a) Intangible fixed assets generated internally - - - - b) Other assets 1,850 - 2,209 - A.2.2 Assets designated at fair value: a) Intangible fixed assets generated internally - - - - b) Other assets - - - - Total 1,850 - 2,209 - NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 279 FINANCIAL YEAR 2010

12.2 Intangible fixed assets: annual changes

Goodwill Other intangible assets: Other intangible Total generated internally assets: other

DEF UNDEF DEF UNDEF A. Gross opening balance -- - 7,765 - 7,765 A.1 Net total of write-downs -- - (5,556) - (5,556) A.2 Net opening balance -- - 2,209 - 2,209 B. Increases - B.1 Purchases - - 925 - 925 B.2 Increases in internal intangible fixed assets x - - - - - B.3 Write-backs x - - - - - B.4 Increases in fair value - allocated to shareholders’ equity x ------allocated to income statement x - - - - - B.5 Positive exchange differences ------B.6 Other changes ------C. Decreases C.1 Sales ------C.2 Write-downs - Amortisation x - - (1,284) - (1,284) - Writedowns + Shareholders' Equity x - - - - - + Income statement ------C.3 Decreases in fair value - allocated to shareholders’ equity x ------allocated to income statement x - - - - - C.4. Transfers to non-current assets held for sale ------C.5 Negative exchange differences ------C.6 Other changes ------D. Net closing balance -- - 1,850 - 1,850 D.1 Net total of write-downs -- - (6,840) - (6,840) E. Gross closing balance -- - 8,690 - 8,690 NOTES TO THE FINANCIAL STATEMENTS - PART B NOTES TO THE FINANCIAL STATEMENTS - PART B E. Valuation at cost -- - 1,850 - 1,850

12.3 Additional information

The useful life of intangible fixed assets that are not generated internally is defined. All intangible fixed assets are held for operating purposes. Amortisation is carried out on a straight-line basis according to the related useful life, which does not exceed 5 years for software. At 31 December 2010, there were no commitments to purchase intangible assets of any significant amount.

280 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

Section 13 - Tax assets and liabilities - Item 130 of Assets and Item 80 of Liabilities

13.1 Deferred tax assets: breakdown

2010 2009 Deferred tax assets 34,764 36,969

1. Loans (including securitised assets) 25,411 27,167 2. Other financial instruments 4,882 4,924 3. Goodwill 57 77 4. Long-term charges - - 5. Tangible fixed assets - - 6. Provisions for risks and charges 4,052 4,180 7. Entertainment expenses 35 90 8. Personnel costs 322 498 9. Tax losses - - 10. Unused tax credits to be deducted - - 11. Other 5 33

13.2 Deferred tax liabilities: breakdown

2010 2009 Gross deferred tax liabilities (1,426) (3,186) 1. Gains to be divided into instalments - - 2. Goodwill - - 3. Tangible fixed assets (155) (265) 4. Financial instruments (1,142) (2,775) 5. Personnel costs (129) (146) 6. Other - - NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 281 FINANCIAL YEAR 2010

13.3 Changes in prepaid taxes (with balancing entry in income statement)

2010 2009 1. Opening balance 34,738 31,647 2. Increases - - 2.1 Prepaid taxes recognised during the year - - a) for previous years - - b) due to a change in accounting criteria - - c) write-backs - - d) other 990 7,774 2.2 New taxes or increases in tax rates - - 2.3 Other increases - - 3. Decreases - - 3.1 Prepaid taxes eliminated during the year - - a) transfers (3,585) (4,683) b) writedowns due to the inability to recover principal - - c) change in accounting criteria - - d) other 3.2 Reduction in tax rates - - 3.3 Other decreases - - 4. Closing balance 32,143 34,738 NOTA INTEGRATIVA INDIVIDUALE - PARTE B NOTES TO THE FINANCIAL STATEMENTS - PART B

282 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

13.4 Changes in deferred taxes (with balancing entry in income statement)

2010 2009 1. Opening balance 644 754 2. Increases - 2.1 Deferred taxes recognised during the year - a) for previous years - 141 b) due to a change in accounting criteria - - c) other - - 2.2 New taxes or increases in tax rates - - 2.3 Other increases - - 3. Decreases - 3.1 Deferred taxes eliminated during the year - a) transfers (214) (251) b) due to a change in accounting criteria - - c) other - - 3.2 Reduction in tax rates - - 3.3 Other decreases - - 4. Closing balance 430 644

13.5 Changes in prepaid taxes (with balancing entry in shareholders’ equity)

2010 2009 1. Opening balance 2,230 - 2. Increases 2.1 Prepaid taxes recognised during the year a) for previous years 604 2,230 b) due to a change in accounting criteria - c) other - 2.2 New taxes or increases in tax rates - NOTES TO THE FINANCIAL STATEMENTS - PART B 2.3 Other increases - 3. Decreases 3.1 Prepaid taxes eliminated during the year a) transfers (213) - b) writedowns due to the inability to recover principal - c) due to a change in accounting criteria - d) other 3.2 Reduction in tax rates - 3.3 Other decreases - 4. Closing balance 2,621 2,230

Notes to the Financial Statements - Part B • 283 FINANCIAL YEAR 2010

13.6 Changes in deferred taxes (with balancing entry in shareholders’ equity)

2010 2009 1. Opening balance 2,541 206 2. Increases - 2.1 Deferred taxes recognised during the year - a) for previous years - 2,335 b) due to a change in accounting criteria - - c) other 301 - 2.2 New taxes or increases in tax rates - - 2.3 Other increases - - 3. Decreases - 3.1 Deferred taxes eliminated during the year - a) transfers (1,846) - b) due to a change in accounting criteria - - c) other - - 3.2 Reduction in tax rates - - 3.3 Other decreases - - 4. Closing balance 996 2,541

13.7 Additional information

2010 2009 A. Gross current tax assets 6,075 2,532 A1. Advance IRES payments 2,650 - A2. Advance IRAP payments 3,313 1,647 A3. Other credits and withholdings 112 885 B. Offset against current tax liabilities (1,038) - C. Net current tax assets 5,037 2,532

2010 2009 NOTES TO THE FINANCIAL STATEMENTS - PART B A. Gross current tax liabilities 3,920 3,280 A1. IRES tax payables 1,038 - A2. IRAP tax payables 2,882 3,280 A3. Other current income tax payables - - B. Offset against current tax assets (1,038) - C. Net current tax liabilities 2,882 3,280

284 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

Section 14 - Non-current assets and disposal groups held for sale and related liabilities- Item 140 of Assets and Item 90 of Liabilities

On 29 December 2009, following notice given to the supervisory authorities, the Parent Company Banca Intermobiliare, by means of a public document, acquired 100% of the shares in Immobiliare D S.r.l. as part of a transaction aimed at recovering a credit exposure which was secured by real estate properties held by the acquired equity investment. Starting with the annual financial statements as at 31 December 2009, this equity investment was recorded under assets held for sale as dictated by IFRS 5. At the annual financial closing date of 31 December 2010 - since 12 months had elapsed within which the disposal of the equity investment could have been completed and since, at that time, the prerequisites were no longer met to consider the disposal highly likely, even though all actions aimed at completing such a disposal had been completed - Banca Intermobiliare chose to reclassify the equity investment in Immobiliare D S.r.l. from the item “Non-current assets and disposal groups held for sale” to “Equity investments.”

Section 15 - Other assets - Item 150 15.1 Other Assets: breakdown

Items/Amounts 2010 2009 - Due from inland revenue and other tax authorities 9,408 13,201 - Current account cheques drawn on third parties 2,484 3,090 - Receivables for bond coupons and securities 749 282 - Security deposits 56 78 - Work in process items 2,504 1,206 - Accrued income not related to Bank items 45 26 - Prepaid expenses not related to Bank items 834 365 - Other Trade receivables 1,301 444 Intercompany receivables 9,250 10,635 Other loans and receivables 1,789 4,579 TOTAL 28,420 33,906 NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 285 FINANCIAL YEAR 2010

LIABILITIES

Section 1 - Due to banks - Item 10

1.1 Due to banks: breakdown by type

Type of transaction/Amounts 2010 2009 1. Due to central banks 85,001 93,157 2. Due to banks 2.1 Current accounts and demand deposits 119,255 95,493 2.2 Term deposits 103,968 80,940 2.3 Loans 2.3.1 Repurchase agreements - - 2.3.2 Other 245,067 257,956 2.4 Payables for commitments to repurchase Bank equity instruments - - 2.5 Other payables 7,280 1,485 Total 560,571 529,031 Fair value 560,571 529,031

1.2 Detail of Item 10 “Due to banks”: subordinated debt Not applicable.

1.3 Detail of Item 10 “Due to banks”: structured debt Not applicable.

1.4 Payables to banks covered by specific hedges Not attainable.

1.5 Payables related to finance leases Not attainable. NOTES TO THE FINANCIAL STATEMENTS - PART B

286 •Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

Section 2 - Due to clients: Item 20

2.1 Due to clients: breakdown by type

Type of transaction/Amounts 2010 2009 1. Current accounts and demand deposits 1,368,104 1,632,825 2. Term deposits 497 1,131

3. Loans 3.1 Repurchase agreements 44,031 124,444 3.2 Other 160,203 - 4. Payables for commitments to repurchase Bank equity instruments - - 5. Other payables 64 2,435 Total 1,572,899 1,760,835 Fair value 1,572,899 1,760,835

2.2 Detail of Item 20 “Due to clients”: subordinated debt Not attainable.

2.3 Detail of Item 20 “Due to clients”: structured debt Not attainable.

2.4 Payables to clients covered by specific hedges Not attainable.

2.5 Payables related to finance leases Not attainable. NOTES TO THE FINANCIAL STATEMENTS - PART B

Notes to the Financial Statements - Part B • 287 FINANCIAL YEAR 2010

Section 3 - Outstanding securities - Item 30

3.1 Outstanding securities: breakdown by type

Type of securities/ 2010 2009 Amounts Fair value Fair value Book Book value value Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 A. Securities 1. Bonds 1.1 Structured bonds 77,277 - - 77,160 55,761 - - 56,088 1.2 Other bonds 339,924 131,571 - 241,474 304,566 132,775 - 175,211 2. Other securities 2.1 Structured securities ------2.2 Other securities 4,365 - 4,365 - 7,315 - 7,315 - Total 421,566 131,571 4,365 318,634 367,642 132,775 7,315 231,299

3.2 detail of Item 30 “Outstanding securities”: subordinated securities

(Book value)

Items/Amounts 2010 2009 Convertible bond, 1.5%, 2005-2015 134,181 132,495

3.3 outstanding securities covered by specific hedges Not attainable. NOTES TO THE FINANCIAL STATEMENTS - PART B NOTES TO THE FINANCIAL STATEMENTS - PART B

288 • Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

Section 4 - Financial liabilities held for trading - Item 40

4.1 Financial liabilities held for trading: breakdown by type

Type of transaction/Amounts 2010 2009 Fair value Fair value Nom. Fair Nom. Fair value Level 1 Level 2 Level 3 value value Level 1 Level 2 Level 3 value

A. Non-derivative liabilities 1. Due to banks 105 412 - - 412 42 187 - 2 190 2. Due to clients 951 6,817 - 1,591 8,408 2,524 7,100 - - 7,100 3. Debt securities 3.1 Bonds 3.1.1 Structured bonds - - - - x - - - - x 3.1.2 Other bonds - - - - x - - - - x 3.2 Other securities 3.2.1 Structured securities - - - - x - - - - x 3.2.2 Other securities - - - - x - - - - x Total A 1,056 7,229 - 1,591 8,820 2,566 7,287 - 2 7,290 B. Derivatives 1. Financial derivatives 1.1 Held for trading x 24,870 111,781 2,352 x x 1,095 75,828 423 x 1.2 Connected with fair value option x - - - x x - - - x 1.3 Other x - - - x x - - - x 2. Credit derivatives 2.1 Held for trading x - 1,526 - x x - 1,365 - x 2.2 Connected with fair value option x - - - x x - - - x 2.3 Other x - - - x x - - - x Total B x 24,870 113,307 2,352 x x 1,095 77,193 423 x Total (A+B) x 32,099 113,307 3,943 x x 8,382 77,193 425 x

* Fair value adjusted for change in credit rating NOTES TO THE FINANCIAL STATEMENTS - PART B

4.2 Detail of Item 40 “Financial liabilities held for trading”: subordinated liabilities Not attainable.

4.3 Detail of Item 40 “Financial liabilities held for trading”: structured debt Not attainable.

Notes to the Financial Statements - Part B • 289 FINANCIAL YEAR 2010

4.4 Non-derivative financial liabilities (excluding “technical exposure”) held for trading: annual changes

Not attainable.

Section 8 - Tax liabilities - Item 80

See Section 13 under assets, “Tax assets and tax liabilities”.

Section 10 - Other liabilities - Item 100

10.1 Other liabilities: breakdown

Items/Amounts 2010 2009 - Amounts to be paid to tax authorities 6,067 8,160 - Payables to social security agencies 1,513 1,438 - Other staff payables 6,130 7,357 - Work in process items 3,719 3,690 - Deferred credits not related to Bank items 331 331 - Payables resulting from deterioration in credit commitments 596 1,652 - Other trade payables 8,813 10,149 payables to subsidiaries 504 251 broker payables 11,729 9,219 other payables 1,965 300 Total 41,367 42,547

Section 11 - Employees’ severance fund- Item 110

11.1 Employees’ severance fund: annual changes

NOTES TO THE FINANCIAL STATEMENTS - PART B 2010 2009 A. Opening balance 3,626 3,770 B. Increases B.1 Provision for the year 1,923 1,932 B.2 Other changes 235 668 C. Decreases C.1 Payments (2,023) (2,744) C.2 Other changes (13) - D. Net closing balance 3,748 3,626 Total 3,748 3,626

290 • Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

11.2 Additional information

The following table indicates the actuarial assumptions for the calculation of the discounted value of the employees’ severance fund as required by IAS 19.

ASSUMPTIONS 31.12.2010 Economic assumptions Annual discounting rate 4.5% Annual inflation rate 2.0% Annual salary increase rate 3.0% Demographic assumptions Death (publication of General State Accountancy) RGS 48 Mortality Tables Invalidity INPS Tables broken down by age and sex Retirement age 100% upon achieving AGO requirements Turnover and advances of employees' severance fund Incidence of advances 2.0% Turnover frequency Table 5.4

Section 12 - Provisions for risks and charges - Item 120

12.1 Provisions for risks and charges: breakdownt

Items/Amounts 2010 2009 1. Company pension provisions - - 2. Other provisions for risks and charges 2.1 Legal disputes 11,651 12,159 2.2 Personnel-related charges 65 25 2.3 Other securities - 3,017 Total 11,716 15,201

12.2 Provisions for risks and charges: annual changes

Pension provisions Other provisions Total A. Opening balance - 15,201 15,201 B. Increases NOTES TO THE FINANCIAL STATEMENTS - PART B B.1 Provision for the year - 2,164 2,164 B.2 Changes due to the passage of time - 465 465 B.3 Changes due to changes in discount rate - - - B.4 Other changes - - - C. Decreases C.1 Utilisation during the year - (2,052) (2,052) C.2 Changes due to changes in discount rate - - - C.3 Other changes - (4,062) (4,062) D. Net closing balance - 11,716 11,716

Notes to the Financial Statements - Part B • 291 FINANCIAL YEAR 2010

12.3 Company defined-benefit pension provisions Not attainable

12.4 Provision for risks and charges - other provisions The “Provision for risks and charges” covers the risks of lawsuits brought against Banca Intermobiliare, and was determined by separately assessing each existing case. It mainly addresses contingent liabilities and risks related to disputes of various sorts related, among other things, to the disloyalty of former advisors or complaints, and any related reimbursements made to customers. The increase during the year was due to recent negative developments in pending disputes, for which the company decided to set aside a conservative provision.

Items/Amounts 2010 2009 Disputes 11,256 11,502 Claims 460 682 Other - 3,017 11,716 15,201

Section 14 - Company equity - Items 130, 150, 160, 170, 180, 190 and 200

14.1 “Capital” and “Treasury shares”: breakdown

Items/Amounts 31.12.2010 31.12.2009 Share capital Ordinary shares 156,209 156,038 Preference shares - - Treasury shares (number) (34,416) (33,802) NOTES TO THE FINANCIAL STATEMENTS - PART B

292 • Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

14.2 Capital - Number of shares: annual changes

Items/Types Ordinary shares Other A. Share balance at the beginning of the year - Fully paid 156,037,608 - - Not fully paid - - A.1 Treasury shares (-) (6,970,101) - A.2 Outstanding shares: Opening balance 149,067,507 - B. Increases B.1 New issues - - - paid: - business combination transactions - - - conversion of bonds - - - exercise of warrants - - - other 171,855 - - free of charge: - to employees - - - to directors - - - other - - B.2 Sale of treasury shares 207,628 - B.3 Other changes - - C. Decreases C.1 Elimination - - C.2 Purchase of treasury shares (405,473) - C.3 Company sale transactions - - C.4 Other changes - - D. Outstanding shares: Net closing balance 149,041,517 - D.1 Treasury shares (+) 7,167,946 - D.2 Share balance at the end of the year - Fully paid 156,209,463 - - Not fully paid - -

14.3 Capital: additional information

At 31 December 2010, the Bank’s share capital totalled EUR 156,209,000 consisting of 156,209,463 ordinary shares NOTES TO THE FINANCIAL STATEMENTS - PART B with a nominal value of EUR 1 each. In accordance with the Articles of Association, each ordinary share grants the holder the right to one vote at the shareholders’ meeting. At the reporting date, share capital was fully paid-in.

14.4 Retained earnings: additional information The legal reserve, established by law, must be equal to at least one fifth of share capital; in the past it was funded by allocations equal to 5% of annual net profits. The statutory or undivided profit reserve is created in accordance with the Articles of Association by allocating the portion of profit remaining after the distribution of profits on shares. Lastly, other reserves are funded as a result of allocations of shares and stock options and as a balancing entry for the elimination of operating components resulting from the trading of treasury shares.

Notes to the Financial Statements - Part B • 293 FINANCIAL YEAR 2010

Information required by Article 2427, paragraph 7-bis, of the Civil Code Amount Possible use Available Summary of uses Items portion over last three years To cover For other losses uses Share capital 156,209 Equity instruments 30,023 Issue premiums - a-b - (138) Reserves Statutory reserve: legal reserve 31,128 b 31,128 Undivided profit reserve 33,543 a-b-c 33,543 (62,890) (25,228) Reserve for purchase of treasury shares 83,776 a-b-c 83,776 (23,225) Reserve for treasury shares 34,416 (1,921) Transition to IAS - reserves generated by IAS 39: fair value designation of financial instruments held for trading 1,636 a-b-c 1,636 (275) - reserves generated by IAS 39: other 340 a-b-c 340 - reserves generated by other valuations in accordance with IAS/IFRS (2,837) a-b-c (2,837) Other reserves - reserve formed as a balancing entry to the recording of shares and stock options in the income statement 12,154 a-b 12,154 - balancing entry of reversal of profits/losses generated by treasury share trading (2,656) a-b (2,656) Valuation reserves Valuation reserve for assets available for sale (3,322) 1 (58,867) Valuation reserves for tangible fixed assets Treasury shares (34,416) (52,211) Profit for the year 13,872 Total 353,866 157,084

Possible use: Additional information: a = capital increasee 1 - Reserve is not available pursuant to Art. 6 of Italian Legislative Decree 38/2005 (b) b = to cover losses c = for distribution to shareholders

NOTES TO THE FINANCIAL STATEMENTS - PART B 14.5 Equity instruments: breakdown and annual changes

Breakdown 2010 2009 Equity portion of convertible bond 2005-2015 30,023 30,023

294 • Notes to the Financial Statements - Part B FINANCIAL YEAR 2010

2010 2009 A. Opening balance 30,023 30,023 B. Increases B1. Issuance of convertible bond - - B2. Other changes - - C. Decreases C1. Redemption of convertible bond - - C2. Other changes - - D. Net closing balance 30,023 30,023

14.6 Additional information

Not applicable.

Additional information

1. Guarantees and commitments

Transactions 2010 2009 1) Financial guarantees issued a) Banks 1,858 1,613 b) Clients 66,052 74,159 2) Trade guarantees issued - a) Banks - - b) Clients - - 3) Irrevocable commitments to disburse funds - a) Banks - i) usage certain 931 384 ii) usage uncertain - 2,380 b) Clients - i) usage certain 12,894 35,197 ii) usage uncertain 98,453 170,751 4) Commitments underlying credit derivatives: sales of protection 31,245 58,000

5) Assets used to secure third party obligations 242,804 - NOTES TO THE FINANCIAL STATEMENTS - PART B 6) Other commitments 49,680 9,040 Total 503,917 351,524

The amount indicated in item 5) refers to the risk assumed for the default of other participants in the New Collateralised Interbank Market as required by the Bank of Italy starting in financial year 2010.

Notes to the Financial Statements - Part B • 295 FINANCIAL YEAR 2010

2. Assets used to secure own liabilities and commitments

Portfolios 2010 2009 1. Financial assets held for trading 10,292 146,138 2. Financial assets designated at fair value - - 3. Financial assets available for sale 36,731 153,349 4. Financial assets held to maturity 2,653 5,533 5. Loans to banks 2,986 79,828 6. Loans to clients 2,287 9,336 7. Tangible fixed assets - - Total 54,949 394,184

3. Information on operating leases Not applicable.

4. Asset management and trading on behalf of others

Type of service 2010 1. Order execution on behalf of customers a) Purchases 1. settled 24,933,238 2. unsettled - b) Sales 1. settled 26,162,011 2. unsettled - 2. Portfolio management a) individual - b) collective - 3. Custody and administration of securities a) Third-party securities on deposit: connected with the performance of custodial bank services (excluding portfolio management) 1. Securities issued by the bank preparing the financial statements -

NOTES TO THE FINANCIAL STATEMENTS - PART B NOTES TO THE FINANCIAL STATEMENTS - PART B 2. Other securities - b) Third-party securities on deposit (excluding portfolio management): other 1. Securities issued by bank preparing the financial statements 396,113 2. Other securities 14,787,927 c) Third-party securities deposited with others 15,184,040 cd) Owned securities deposited with others 680,941 4. Other transactions -

296 • Notes to the Financial Statements - Part B FINANCIAL YEAR 2010 Part C - INFORMATION ON THE INCOME STATEMENT

Section 1 - Interest - Items 10 and 20

1.1 interest income and similar items: breakdown

Items/Types Debt securities Loans Other Total 2010 Total 2009 transactions 1. Financial assets held for trading 10,537 - - 10,537 11,540 2. Financial assets available for sale 6,251 - - 6,251 9,556 3. Financial assets held to maturity 188 - - 188 262 4. Loans to banks 2,482 1,039 313 3,834 5,926 5. Loans to customers 317 37,506 335 38,158 45,328 6. Financial assets designated at fair value - - - - - 7. Hedging derivatives - - - - - 8. Other assets - - 2 2 - Total 19,775 38,545 650 58,970 72,612

The component deemed to be the non-recoverable portion of interest income on non-performing assets was adjusted and included under Item 130 “Write-downs due to impairment.”

1.2 interest income and similar items: hedging transaction differentials Not applicable.

1.3 interest income and similar items: additional information

1.3.1 Interest income on financial assets in foreign currency

2010 2009 Interest income on financial assets in foreign currency 450 405 NOTES TO THE FINANCIAL STATEMENTS - PART C

1.3.2 Interest income on finance leasing transactions Not applicable.

Notes to the Financial Statements - Part C • 297 FINANCIAL YEAR 2010

1.4 Interest expense and similar items: breakdown

Items/Types Payables Securities Other Total Totale transactions 2009 1. Due to central banks 24 x - 24 495 2. Due to banks 5,862 - 981 6,843 7,203 3. Due to clients 9,906 x - 9,906 21,622 4. Outstanding securities x 13,245 - 13,245 15,175 5. Financial liabilities held for trading - 27 2,116 2,143 2,351 6. Financial liabilities designated at fair value - - - - - 7. Other liabilities and provisions x x 3 3 18 8. Hedging derivatives x x - - - Total 15,768 13,272 3,100 32,164 46,864

1.5 Interest expense and similar items: hedging transaction differentials Not applicable.

1.6 Interest expense and similar items: additional information

1.6.1 Interest expense on liabilities in foreign currency

2010 2009 Interest expense on financial liabilities in foreign currency 3,055 899

1.6.2 Interest expense on liabilities for finance leasing transactions Not applicable. NOTES TO THE FINANCIAL STATEMENTS - PART C NOTES TO THE FINANCIAL STATEMENTS - PART C

298 • Notes to the Financial Statements - Part C FINANCIAL YEAR 2010

Section 2 - Commissions and fees - Items 40 and 50

2.1 Fee and commission income: breakdown

Type of services/Amounts 2010 2009 a) guarantees issued 436 447 b) credit derivatives - - c) management, brokering, and consulting services: 1. trading of financial instruments 27,826 28,249 2. trading of foreign currencies - - 3. portfolio management 3.1. individual - - 3.2. collective - - 4. custody and administration of securities 160 154 5. custodian bank 1,201 1,191 6. placement of securities 596 754 7. order receipt and transmission 3,661 2,332 8. advisory services 8.1. relating to investments 1,024 589 8.2. relating to financial structure 289 375 9. distribution of third-party services 9.1. portfolio management 9.1.1. individual 11,881 10,899 9.1.2. collective 13,193 8,943 9.2. insurance products 198 271 9.3. other products 41 8 d) collection and payment services 396 379 e) securitisation servicing - - f) servicing for factoring transactions - - g) tax collection services - - h) management of multilateral exchange systems - - i) current account maintenance and management - - j) other services 196 32 NOTES TO THE FINANCIAL STATEMENTS - PART C Total 61,098 54,623

Notes to the Financial Statements - Part C • 299 FINANCIAL YEAR 2010

2.2 Fee and commission income: product and service distribution channels

Channels/Amounts 2010 2009 a) at branches 1. portfolio management - - 2. placement of securities 596 754 3. third-party services and products 25,313 20,121 b) offered off-site 1. portfolio management - - 2. placement of securities - - 3. third-party services and products - - c) other distribution channels: 1. portfolio management - - 2. placement of securities - - 3. third-party services and products - -

2.3 Fee and commission expenses: breakdown

Services/Amounts 2010 2009 a) guarantees received - - b) credit derivatives - - c) management and brokering services - - 1. trading of financial instruments 4,330 4,348 2. trading of foreign currencies - - 3. portfolio management: 3.1 own portfolios - - 3.2 delegated by third parties 11,452 9,269 4. custody and administration of securities 2,281 1,787 5. placement of financial instruments 72 14 6. off-site proposals for financial instruments, products and services - - NOTES TO THE FINANCIAL STATEMENTS - PART C NOTES TO THE FINANCIAL STATEMENTS - PART C d) collection and payment services 199 134 e) other services 484 610 Total 18,818 16,162

300 • Notes to the Financial Statements - Part C FINANCIAL YEAR 2010

Section 3 - Dividends and similar income - Item 70

3.1 Dividends and similar income: breakdown

Items/Income 2010 2009 Dividends Income Dividends Income on UCI units on UCI units A. Financial assets held for trading 382 - 190 - B. financial assets available for sale 2,280 267 1,090 - C. Financial assets designated at fair value - - - - D. Equity investments 6,816 x - x Total 9,478 267 1,280 -

Section 4 - Gains and losses on assets held for trading - Item 80

4.1 Gains and losses on assets held for trading: breakdown

2010 Transactions/Income Capital Trading Capital Trading Net profit components gains profits losses losses (loss) 1. Financial assets held for trading 1.1 Debt securities 1,216 4,388 (2,123) (3,857) (376) 1.2 Equity securities 781 15,782 (1,216) (5,724) 9,623 1.3 UCI units - 57 - - 57 1.4 Loans - - - - - 1.5 Other - 2,784 - (2,526) 258 2. Financial liabilities held for trading 2.1 Debt securities - - - - - 2.2 Payables - - - - - 2.3 Other 78 427 (967) (1,010) (1,472) 3. Financial assets and financial liabilities: exchange differences x x x x (633) NOTES TO THE FINANCIAL STATEMENTS - PART C 4. Derivatives 4.1 Financial derivatives: - On debt securities and interest rates 312 6,196 (1,032) (1,739) 3,737 - On equity securities and stock indices 4,176 6,935 (1,416) (15,968) (6,273) - On currencies and gold x x x x 12,022 - Other - - - (3) (3) 4.2 Credit derivatives - - (1,515) - (1,515) Total x x x x 15,425

Notes to the Financial Statements - Part C • 301 FINANCIAL YEAR 2010

2009 Transactions/Income Capital Trading Capital Trading Net profit components gains profits losses losses (loss) 1. Financial assets held for trading 1.1 Debt securities 3,839 13,593 (2,079) (630) 14,723 1.2 Equity securities 1,638 4,740 (324) (6,676) (622) 1.3 UCI units 602 1 - - 603 1.4 Loans - - - - - 1.5 Other - 710 - (310) 400 2. Financial liabilities held for trading 2.1 Debt securities - 2 - (4) (2) 2.2 Payables - - - - - 2.3 Other 143 563 (1,609) (472) (1,375) 3. Financial assets and financial liabilities: exchange differences x x x x 304 4. Derivatives 4.1 Financial derivatives: - On debt securities and interest rates 4,676 405 (18) (136) 4,927 - On equity securities and stock indices 1,567 14,627 (2,036) (19,612) (5,454) - On currencies and gold x x x x 5,787 - Other - 4 - (20) (16) 4.2 Credit derivatives 905 - (2,695) - (1,790) Total x x x x 17,485

Section 5 - Gains and losses on hedging operations - Item 90

5.1 net profit on hedging operations breakdown

Income components/Amounts 2010 2009 A. Income on: A.1. Fair value hedging derivatives - 4,088 A.2 Hedged financial assets (fair value) - - A.2 Hedged financial liabilities (fair value) - - A.4 Financial derivatives to hedge cash flows - - NOTES TO THE FINANCIAL STATEMENTS - PART C NOTES TO THE FINANCIAL STATEMENTS - PART C A.5 Assets and liabilities in foreign currency - - Total income on hedging operations (A) - 4,088 B. Costs related to: B.1. Fair value hedging derivatives - - B.2 Hedged financial assets (fair value) - (3,535) B.3 Hedged financial liabilities (fair value) - - B.4 Financial derivatives to hedge cash flows - - B.5 Assets and liabilities in foreign currency - - Total costs on hedging operations (B) - (3,535) C. Net profit (loss) on hedging operations (A - B) - 553

302 • Notes to the Financial Statements - Part C FINANCIAL YEAR 2010

Section 6 - Profit (loss) on disposal or repurchase - Item 100

6.1 Profit (loss) on disposal or repurchase: breakdown

Items/Income components 2010 2009 Profits Losses Net profit Profits Losses Net profit (loss) (loss) Financial assets 1. Loans to banks 94 - 94 - - - 2. Loans to clients ------3. Financial assets available for sale 3.1 Debt securities 1,750 (417) 1,333 7,248 (166) 7,082 3.2 Equity securities 6,460 (459) 6,001 23,968 - 23,968 3.3 UCI units 163 (196) (33) - (713) (713) 3.4 Loans ------4. Financial assets held to maturity ------Total assets 8,467 (1,072) 7,395 31,216 (879) 30,337 Financial liabilities 1. Due to banks ------2. Due to clients ------3. Outstanding securities 427 (796) (369) 198 (538) (340) Total liabilities 427 (796) (369) 198 (538) (340)

Section 8 - Net write-downs/write-backs for impairment - Item 130

8.1 Net write-downs/write-backs for impairment of loans: breakdown

Write-downs Write-backs Total Total Transactions/Income 2010 2009 Specific Portfolio Specific Portfolio components Write-offs Other From From other From Other

interest write-backs interest write-backs NOTES TO THE FINANCIAL STATEMENTS - PART C A. Loans to banks - Loans ------Debt securities ------B. Loans to clients - Loans (1,205) (13,744) (228) 2,133 8,592 - 67 (4,385) (18,106) - Debt securities ------C. Total (1,205) (13,744) (228) 2,133 8,592 - 67 (4,385) (18,106)

Notes to the Financial Statements - Part C • 303 FINANCIAL YEAR 2010

8.2 Net write-downs for impairment of financial assets available for sale: breakdown

Operazioni/ Specific write-downs Specific write-backs Total Total Componenti 2010 2009 reddituali Write-offs Other From From other interest write-backs A. Debt securities ------B. Equity securities - (1,050) x x (1,050) (10,847) C. UCI units - - x - - - D. Loans to banks ------E. Loans to clients ------F. Total - (1,050) - - (1,050) (10,847)

8.3 Net write-downs for impairment of financial assets held to maturity: breakdown Not applicable.

8.4 Net write-downs for impairment of other financial transactions: breakdown

Write-downs Write-backs Total Total Transactions/ 2010 2009 Income Specific Portfolio Specific Portfolio components Write-offs Other From Other From Other interest write-backs interest write-backs A. Guarantees provided - -- - 6 - 161 167 - B. Credit derivatives ------C. Commitments to disburse funds ------

NOTES TO THE FINANCIAL STATEMENTS - PART C NOTES TO THE FINANCIAL STATEMENTS - PART C D. Other transactions ------E. Total - -- - 6 - 161 167 -

304 • Notes to the Financial Statements - Part C FINANCIAL YEAR 2010

Section 9 - Administrative expenses - Item 150

9.1 Personnel costs: breakdown

Type of cost/Amounts 2010 2009 1) Employed staff a) salaries and wages 29,595 29,773 b) social security costs 7,743 7,933 c) severance pay 17 10 d) pension expenses 186 185 e) provision to employees' severance fund 1,923 1,932 f) provision to pension fund and similar obligations: - defined contribution - - - defined benefit - - g) contributions to supplementary external retirement benefit funds: - defined contribution 924 956 - defined benefit - - h) costs related to share-based payments 543 625 i) other employee benefits 1,414 964 2) Other working staff 1,488 1,389 3) Directors and statutory auditors 1,101 1,402 4) Retired staff - - 5) Cost recoveries for employees seconded at other companies (215) (122) 6) Cost recoveries for employees of third parties seconded at the company - - Total 44,719 45,047

9.2 Average number of employees by category

31.12.2009 Redundancy New hires Category 31.12.2010 Average

changes Employees staff a) executives 28 (3) - - 25 27 b) managers 234 (18) 8 19 243 239 c) remaining staff 230 (19) 32 (19) 224 227 NOTES TO THE FINANCIAL STATEMENTS - PART C Total employed staff 492 (40) 40 - 492 492 Other staff 3 (3) 2 - 2 3

9.3 Company defined benefit pension provisions: total costs Not applicable.

9.4 Other employee benefits The charge for other employee benefits largely concerns contributions for medical care and meals and premiums for insurance policies entered into for employees.

Notes to the Financial Statements - Part C • 305 FINANCIAL YEAR 2010

9.5 Other administrative expenses: breakdown

Type of cost/Amounts 2010 2009 - property rentals 4,302 4,243 - furniture and property maintenance expenses 946 974 - other property expenses 303 316 - postal and telephone expenses 1,239 1,257 - electricity, heating and water 581 569 - equipment and software leases 3,279 2,692 - electronic calculations 2,239 2,567 - regular assistance and software rental 1,488 1,213 - advertising and entertainment 1,303 893 - legal and notary services 1,953 1,381 - miscellaneous advisory and other services 4,836 4,999 - subscriptions 411 329 - transportation 1,052 977 - insurance 1,341 860 - surveillance and security 34 34 - cleaning expenses 533 547 - charitable and other donations 84 79 - printing and stationery 286 337 - association and union dues 262 260 - general expenses 297 281 - other expenses 320 244 - indirect and other taxes 425 501 Total 27,514 25,553

Section 10 - Net allocations to provisions for risks and charges - Item 160

NOTES TO THE FINANCIAL STATEMENTS - PART C NOTES TO THE FINANCIAL STATEMENTS - PART C 10.1 Net allocations to provisions for risks and charges: breakdown

Type of cost/Amounts 2010 2009 Net allocations to provisions for risks and charges for: - legal disputes (2,505) (14,605) - personnel-related charges (40) - - other charges - 3,965 Total (2,545) (10,640)

306 • Notes to the Financial Statements - Part C FINANCIAL YEAR 2010

Section 11 - Net write-downs/write-backs on tangible fixed assets - Item 170

11.1 Net write-downs/write-backs on tangible fixed assets: breakdown

2010 2009 Assets/Income Depreciation Net write-downs Write-backs Net profit Depreciation Net write-downs Write-backs Net profit components (a) for impairment (c) (a+b+c) (a) for impairment (c) (a+b+c) (b) (b) A. Tangible fixed assets A.1 Owned - For operating use 2,123 - - 2,123 2,308 - - 2,308 - For investment ------A.2 Held under finance leases - For operating use ------For investment ------Total 2,123 - - 2,123 2,308 - - 2,308

No permanent losses in value or write-backs were reported.

Section 12 - Net write-downs/write-backs on intangible fixed assets - Item 180

12.1 Net write-downs/write-backs on intangible fixed assets: breakdown

2010 2009 Assets/Income Amortisation Net write- Write-backs Net profit Amortisation Net write-downs Write-backs Net profit components (a) downs for (c) (loss) (a) for impairment (c) (a+b+c) impairment (b) (a+b-c) (b) A. Intangible fixed assets NOTES TO THE FINANCIAL STATEMENTS - PART C A.1 Owned - Generated internally by the company ------Other 1,284 - - 1,284 1,283 - - 1,283 A.2 Held under finance leases ------Total 1,284 - - 1,284 1,283 - - 1,283

Notes to the Financial Statements - Part C • 307 FINANCIAL YEAR 2010

Section 13 - Other operating income and expenses - Item 190

13.1 Other operating expenses: breakdown

Type of cost/Amounts 2010 2009 - Contingent liabilities not related to bank items 518 1,925 - Charges for thefts and robberies 14 - - Other miscellaneous expenses 509 319 Total 1,041 2,244

13.2 Other operating income: breakdown

Type of cost/Amounts 2010 2009 - Contingent assets not related to bank items 546 309 - Property rental income 137 115 - Recovery for services rendered to group companies 462 357 - Recovery of legal and notary expenses - 28 - Other income 186 207 - Insurance payouts 730 2,250 Total 2,061 3,266

Section 14 - Profit (loss) on equity investments - Item 210

14.1 Profit (loss) on equity investments: breakdown

Income components/Amounts 2010 2009 A. Income 1. Revaluations - - 2. Profit on disposal - - 3. Write-backs 298 - 4. Other income - - NOTES TO THE FINANCIAL STATEMENTS - PART C NOTES TO THE FINANCIAL STATEMENTS - PART C B. Expenses 1. Write-downs - (59) 2. Write-downs for impairment - - 3. Loss on disposal - - 4. Other expenses - - Net profit (loss) 298 (59)

308 • Notes to the Financial Statements - Part C FINANCIAL YEAR 2010

Section 17 - Profit (loss) on disposal of investments - Item 240

17.1 Profit (loss) on disposal of investments: breakdown

Income components/Amounts 2010 2009 A. Properties - Profit on disposal 9 - - Loss on disposal (2) - B) Other assets - Profit on disposal 990 - - Loss on disposal (1) - Net profit (loss) 996 -

The EUR 990,000 of profits on disposal are related to the disposal of the controlling interest in Parioli Sviluppo S.r.l., which had been acquired as part of a loan recovery transaction.

Section 18 - Income taxes for the year on ordinary activities - Item 260

18.1 Income taxes for the year on ordinary activities: breakdown

Income components/Amounts 2010 2009 1. Current tax payable (-) (3,920) (5,664) 2. Changes in current tax payable for previous years (+/-) 30 - 3. Reduction in current taxes payable for the year (+) - - 4. Change in prepaid taxes (+/-) (2,595) 3,090 5. Change in deferred taxes (+/-) 214 110 6. Accrued income tax for the year (-) (-1+/-2+3+/-4+/-5) (6,271) (2,464)

Component/Amounts 2010 2009 IRES (3,341) 941 IRAP (2,930) (3,405) NOTES TO THE FINANCIAL STATEMENTS - PART C Total tax for the year (6,271) (2,464)

Notes to the Financial Statements - Part C • 309 FINANCIAL YEAR 2010

18.2 Reconciliation between theoretical and actual reported tax burden

Income components/Amounts 2010 2009 Theoretical IRES tax burden (5,539) (193) Tax exempt revenues: dividends 2,446 285 profit on disposal of equity investments ("Pex" regime) 1,117 1,753 loss/gain under tax transparency regime (93) (83) valuation of available-for-sale securities - 1,503 Non-deductible costs valuation of available-for-sale securities (271) - allocated shares and stock options - (172) other non-deductible costs (667) (630) held-for-trading portfolio - (997) pro rata share of interest expense per Art. 96 of the Income Tax Consolidation Act (334) (525) Actual tax burden (3,341) 941

Component/Amounts 2010 2009 Theoretical IRAP tax burden (2,805) (3,064) Tax exempt revenues: 50% of dividends 235 31 Non-deductible costs non-deductible costs - (175) pro rata share of interest expense per Art. 6 of Italian Leg. Dec. 446/97 (61) (103) 10% of administrative expenses (139) (128) 10% of amortisation and depreciation (16) (17) prepaid taxes for previous periods (92) (12) other (102) (30) prepaid taxes for available-for-sale valuation 50 93 Actual tax burden (2,930) (3,405) NOTES TO THE FINANCIAL STATEMENTS - PART C

310 • Notes to the Financial Statements - Part C FINANCIAL YEAR 2010

Section 19 - Profit (loss) on disposal groups held for sale net of taxes - Item 280

19.1 profit (loss) on disposal groups held for sale net of taxes: breakdown

Income components/Amounts 2010 2009 1. Income - - 2. Expenses - - 3. Net valuations of asset group and related liabilities - - 4. Capital gains (losses) - 1,592 5. Taxes and fees - (438) Profit (Loss) - 1,154

19.2 detail of income tax on disposal groups of assets and liabilities held for sale

2010 2009 1. Current taxes (-) - (438) 2. Change in prepaid taxes (+/-) - - 3. Change in deferred taxes (-/+) - - 4. Income taxes for the year (-1+/-2+/-3) - (438)

Section 20 - Other information

There is no additional information to report other than that provided in the sections above.

Section 21 - Earnings per share

21.1 Average number of diluted ordinary shares NOTES TO THE FINANCIAL STATEMENTS - PART C 2010 2009 Attributable Weighted euro Attributable Weighted euro profit average of profit average of (thousands of €) ordinary shares (thousands of €) ordinary shares Earning Per Share EPS base 13.872 149.056.828 0,093 (607) 149.444.207 (0,004) EPS diluito 13.872 168.846.502 0,082 (607) 169.233.881 (0,004)

Notes to the Financial Statements - Part C • 311 FINANCIAL YEAR 2010

21.2 Additional information Basic earnings per share is calculated as the ratio of the net profit (or loss) for the year attributable to ordinary shareholders in relation to the average number of outstanding ordinary shares. Diluted earnings per share is calculated as the ratio of the net profit (or loss) for the year attributable to ordinary shareholders in relation to the average number of outstanding ordinary shares taking into account the diluting effects of converting the bond into shares.

Part D - STATEMENT OF COMPREHENSIVE INCOME

BREAKDOWN OF COMPREHENSIVE INCOME

Items Gross amount Income tax Net amount 10. Profit (loss) for the year x x 13,872 Other income components 20. Financial assets available for sale: a) changes in fair value (3,687) 1,934 (1,753) b) transfer to income statement - write-downs for impairment 1,050 - 1,050 - capital gains (losses) (5,119) - (5,119) c) other changes - - - 110. Total other income components (7,756) 1,934 (5,822) 120. Comprehensive income (Item 10 + 110) 6,116 1,934 8,050 NOTES TO THE FINANCIAL STATEMENTS - PART F NOTES TO THE FINANCIAL STATEMENTS - PART C and D FINANCIAL YEAR 2010 Part E - INFORMATION ON RISKS AND RELATIVE HEDGING POLICIES

In the following part of the Explanatory Notes, information of quantitative nature will be provided in relation to the risks of the parent company Banca Intermobiliare. For information of qualitative nature in relation to the modalities of risk management, refer to the description provided in the consolidated Explanatory Notes - Part E.

SECTION 1 - CREDIT RISK

INFORMATION OF QUANTITATIVE NATURE

A. QUALITY OF THE CREDIT

A.1 Impaired and performing credit exposures: Amounts, value adjustments, movements, economic and territorial distribution.

A.1.1 Distribution of financial assets by portfolio of belonging and credit quality (book values)

Portafolios/quality Bad debts Watchlist Restructured Outstanding Other Total loans exposures exposures assets 1. Financial assets held for trading - - - - 381,745 381,745 2. Financial assets available for sale - - - - 244,153 244,153 3. Financial assets held until maturity - - - - 5,627 5,627 4. Receivables due from banks - - - - 234,799 234,799 5. Receivables due from clients 130,544 25,920 2,784 18,545 1,725,734 1,903,527 6. Financial assets valuated at fair value ------7. Financial assets being disposed ------8. Hedging derivatives ------2010 Total 130,544 25,920 2,784 18,545 2,592,058 2,769,851 2009 Total 138,461 106,760 1,541 79,678 2,486,575 2,813,015

With reference to Ifrs principle 7§37, the maturities of expired financial assets - which are entirely ascribable to the loan portfolio due from clientele - are illustrated below. NOTES TO THE FINANCIAL STATEMENTS - PART E

Portafolios/quality Expired exposures Up to three From three From more Over a year Total months to six months than six months to up to a year 5. Due from clients 495 10,395 7,649 6 18,545

It should also be noted that, during the year, no credit exposure was subject to re-negotiation as part of collective agreements.

Notes to the Financial Statements - Part E • 313 FINANCIAL YEAR 2010

A.1.2 Distribution of credit exposures by portfolio of belonging and credit quality (gross and net values)

Portafolios/quality Impaired assets Performing loans Gross exposure Specific Net exposure Gross exposure Portfolio Net exposure Total adjustments adjustments

1. Financial assets held for trading - - - x x 381,745 381,745 2. Financial assets available for sale - - - 244,153 - 244,153 244,153 3. Financial assets held until maturity - - - 5,627 - 5,627 5,627 4. Receivables due from banks - - - 234,799 - 234,799 234,799 5. Receivables due from clients 233,751 (55,958) 177,793 1,739,349 (13,615) 1,725,734 1,903,527 6. Financial assets valuated at fair value - - - x x - - 7. Financial assets being disposed ------8. Hedging derivatives - - - x x - - Total 2010 233,751 (55,958) 177,793 2,223,928 (13,615) 2,592,058 2,769,851 Total 2009 394,173 (67,733) 326,440 2,498,924 (12,349) 2,486,575 2,813,015

A.1.3 Cash and off-balance sheet credit exposures with banks: gross and net valuest

Type of exposures/values Gross exposure Specific value Portfolio value Net Exposure adjustments adjustments A. CASH EXPOSURES a) Bad debts - - x - b) Watchlist loans - - x - c) Restructured exposures - - x - d) Expired exposures - - x - e) Other assets 588,847 x - 588,847 TOTAL A 588,847 - - 588,847 B. OFF-BALANCE SHEET EXPOSURES a) Impaired - - x - b) Other 76,794 x - 76,794 NOTES TO THE FINANCIAL STATEMENTS - PART E TOTAL B 76,794 - - 76,794 TOTAL A+B 665,641 - - 665,641

A.1.4 Cash credit exposures with banks: movements of gross impaired exposures Not applicable.

A.1.5 Cash credit exposures with banks: movements of overall value adjustments Not applicable.

314 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

A.1.6 Cash and off-balance sheet credit exposures with clients: gross and net values

Type of exposures/values Gross Specific value Portfolio value Net Exposure exposure adjustments adjustments A. CASH EXPOSURES a) Bad debts 184,821 (54,277) x 130,544 b) Watchlist loans 26,947 (1,027) x 25,920 c) Restructured exposures 3,198 (414) x 2,784 d) Expired exposures 18,785 (240) x 18,545 e) Other assets 1,877,511 x (13,615) 1,863,896 TOTAL A 2,111,262 (55,958) (13,615) 2,0446,589 B. OFF-BALANCE SHEET EXPOSURES a) Impaired 637 (6) x 631 b) Other 234,447 x (573) 233,874 TOTAL B 235,084 (6) (573) 234,505

A.1.7 Cash credit exposures with clients: movements of gross impaired exposures

Description/Categories Bad debts Watchlist Restructured Expired loans exposures exposures A. Gross initial exposure 203,490 108,319 1,989 80,374 - including: transferred but not cancelled exposures - - - - B. Increases 3,879 10,463 2,021 11,979 B.1 Inflows from performing credit exposures 601 9,417 - 8,510 B.2 Transfers from other categories of impaired exposures 959 870 1,703 - B.3 Other increases 2,319 176 318 3,469 C. Decreases (22,548) (91,836) (812) (73,568) C.1 Outflows from performing credit exposures - (71,459) - (54,670) C.2 Cancellations (15,978) - - - C.3 Collections (6,570) (19,913) - (11,907) C.4 Capital gains from sales - - - - C.5 Transfers to other categories of impaired exposures - (463) (812) (6,991) C.6 Other decreases - - - - D. Final gross exposure 184,821 26,947 3,198 18,785 - including: transferred but not cancelled exposures - - - - NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 315 FINANCIAL YEAR 2010

A.1.8 Cash credit exposures with clients: movements of overall value adjustments

Description/Categories Bad debts Watchlist Restructured Expired loans exposures exposures A. Overall initial adjustments 65,028 1,560 448 695 - including: transferred but not cancelled exposures - - - - B. Increases 12,630 551 60 148 B.1. Value adjustments 11,768 455 - 1 B.2 Transfers from other categories of impaired exposures 842 96 51 - B.3 Other increases 20 - 9 146 C. Decreases (23,381) (1,084) (94) (603) C.1. Write-backs for valuation (7,643) (30) (78) (6) C.2. Write-backs for collection (892) (910) - (542) C.3. Cancellations (14,847) - - - C.4. Transfers to other categories of impaired exposures - (144) (16) (54) C.5. Other decreases - - - - D. Overall final adjustments 54,277 1,027 414 240 - including: transferred but not cancelled exposures - - - -

A.2 Classification of exposures on the basis of external and internal ratings

A.2.1 Distribution of cash and off-balance sheet credit exposures subdivided by external rating classes (book values)

External rating classes Without Exposures Total ratings AAA/AA- BB+/BB- B+/B- Inferiore a B- A. Cash exposures 191,220 118,203 69,124 3,457 - - 2,248,532 2,630,536 B. Derivatives B.1 Financial derivatives 786 - - -- - 111,494 112,280 B.2 Credit derivatives 34 - - -- - 740 774 C. Issued guarantees ------67,911 67,911 D. Commitments to issue funds 20,000 - 1,000 -- - 10,883 31,883 Total 212,040 118,203 70,124 3,457 - - 2,439,560 2,843,384 NOTES TO THE FINANCIAL STATEMENTS - PART E

The Banca Intermobiliare Group applies the evaluations of the rating agency Moody’s to all portfolios subject to reporting.

A.2.2 Distribution of cash and off-balance sheet credit exposures subdivided by internal rating classes (book values)

Not applicable.

316 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

A.3 Distribution of guaranteed credit exposures by type of guarantee A.3.1 Guaranteed credit exposures with banks

Not applicable.

A.3.2 Guaranteed credit exposures with clients

Personal guarantees (2) Total Collateral (1) Derivatives on loans 2010 Credit commitments Other derivatives (1)+(2) C L N Banks Banks entities entities Securities properties Real esttate Other public Other public Other parties Other parties central banks central banks Value of net exposure Value Other collateral

Governments and Governments and 1. Guaranteed cash credit exposures: 1,577,930 844,665 346,917 96,072 - - - 9,904 248,089 - - - - 1,545,647 1.1Totally guaranteed 1,483,440 844,032 316,035 70,311 - - - 9,904 240,810 - - - - 1,481,092 - of which impaired 168,680 148,892 14,116 3,830 - - - - 1,800 - - - - 168,638 1.2. Partially guaranteed 94,490 633 30,882 25,761 - - - - 7,279 - - - - 64,555 - of which impaired 5,786 633 1,138 3,053 ------4,824 2. Guaranteed “off- balance sheet” credit exposures: 128,961 36,709 21,544 4,115 - - 6 629 22,095 - - - - 85,098 2.1. Totally guaranteed 79,987 36,709 16,940 3,609 - - 6 629 22,095 - - - - 79,988 - of which impaired 631 2 - - - - - 629 - - - - - 631 2.2. Partially guaranteed 48,974 - 4,604 506 ------5,110 - of which impaired ------NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 317 FINANCIAL YEAR 2010

B. DISTRIBUTION AND CONCENTRATION OF CREDIT EXPOSURES

B.1 Sectorial distribution of cash and off-balance sheet credit exposures with clients (book values)

Governments Other public Financial Insurance Non-financial Other entities companies companies companies parties Net exposure Net exposure Net exposure Net exposure Net exposure Net exposure

Exposures/ counterparties Specific value adjustments Specific value adjustments Specific value adjustments Specific value adjustments Specific value adjustments Specific value adjustments

Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments Portfolio value adjustments A. Cash exposures A.1 Bad debts ------2,070 (5,794) - - - - 124,230 (32,299) - 4,244 (16,184) - A.2 Watchlist loans ------25 (33) - - - - 16,284 (471) - 9,611 (523) - A.3 Restructured exposures ------2,580 (409) - 204 (5) - A.4 Expired exposures ------13,882 (190) - 4,663 (50) - A.5 Other exposures 70,033 - - 1,057 - - 299,674 - (349) - - - 930,870 - (8,302) 562,262 - (4,964) TOTAL (A) 70,033 - - 1,057 - - 301,769 (5,827) (349) - - - 1,087,846 (33,369) (8,302) 580,984 (16,762) (4,964) B. Off-balance sheet exposures B.1 Bad debts ------B.2 Watchlist loans ------629 (6) - - - - B.3 Other impaired assets ------2----- B.4 Other exposures ------45,049 - (10) - - - 144,752 - (373) 44,073 - (190) TOTAL (B) ------45,049 - (10) - - - 145,383 (6) (373) 44,073 - (190) TOTAL (A+B) 2010 70,033 - - 1,057 - - 346,818 (5,827) (359) - - - 1,233,229 (33,375) (8,675) 625,057 (16,762) (5,154) TOTAL (A+B) 2009 125,116 - - 1,109 - - 379,830 (5,513) (100) 8,850 - - 1,089,269 (39,054) (8,108) 541,484 (24,072) (4,881) NOTES TO THE FINANCIAL STATEMENTS - PART E

318 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

B.2 Territorial distribution of cash and off-balance sheet credit exposures with clients (book values)

Exposures/geographical ITALY OTHER EUROPEAN AMERICAS ASIA REST OF areas COUNTRIES WORLD adjustments adjustments adjustments adjustments adjustments Overall value Overall value Overall value Overall value Overall value Net exposure Net exposure Net exposure Net exposure Net exposure

A. Cash exposures A.1 Bad debts 130,168 (49,057) 316 (4,979) 60 (241) - - - - A.2 Watchlist loans 25,920 (1,027) ------A.3 Restructured exposures 2,784 (414) ------A.4 Expired exposures 18,545 (240) ------A.5 Other exposures 1,772,039 (13,544) 87,310 (36) 3,312 (23) 1,202 (11) 33 - TOTAL 1,949,456 (64,282) 87,626 (5,015) 3,372 (264) 1,202 (11) 33 - B. Off-balance sheet exposures B.1 Bad debts ------B.2 Watchlist loans 629 (6) ------B.3 Other impaired assets 2 ------B.4 Other exposures 220,482 (565) 13,391 (8) - - 2 - - - TOTAL 221,113 (571) 13,391 (8) - - 2 - - - TOTAL 2010 2,170,569 (64,853) 101,017 (5,023) 3,372 (264) 1,204 (11) 33 - TOTAL 2009 1,946,371 (69,740) 158,881 (4,323) 39,041 (96) 1,024 (10) 71 (7,559) NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 319 FINANCIAL YEAR 2010

B.3 Territorial distribution of cash and off-balance sheet credit exposures with banks (book values)

Exposures/geographical areas ITALY OTHER EUROPEAN AMERICAS ASIA REST OF WORLD COUNTRIES adjustments adjustments adjustments adjustments adjustments Overall value Overall value Overall value Overall value Overall value Net exposure Net exposure Net exposure Net exposure Net exposure

A. Cash exposures A.1 Bad debts ------A.2 Watchlist loans ------A.3 Restructured exposures ------A.4 Expired exposures ------A.5 Other exposures 431,494 - 144,531 - 12,770 - - - 52 - TOTAL 431,494 - 144,531 - 12,770 - - - 52 - B. Off-balance sheet exposures B.1 Bad debts ------B.2 Watchlist loans ------B.3 Other impaired assets ------B.4 Other exposures 5,430 - 70,320 - 1,044 - - - - - TOTAL 5,430 - 70,320 - 1,044 - - - - - TOTAL 2010 436,924 - 214,851 - 13,814 - - - 52 - TOTAL 2009 482,579 - 158,569 - 23,700 - - - - -

B.4 Significant exposures

Following the 6th update of Memorandum 263 “New provisions of prudential supervision for banks” dated 27 December 2010, the regulations pertaining to significant exposures were broadly revised byDIRECTIVE 2009/111/ EC which amends directives 2006/48 and 2006/49. The previous EC regulation was characterized by an approach of “minimum harmonization” which allowed member states and national supervisory authorities broad margins for choice in both incorporating and correctly applying harmonized rules. The revision which was recently applied aims to create a high level of consistency between regulations and the NOTES TO THE FINANCIAL STATEMENTS - PART E supervisory practices at the EU level. This objective is attained by significantly reducing the level of discretion allowed to individual member states. In particular, the criteria for calculating and weighting risk positions are modified as a result of the elimination of numerous pre-existing national areas of discretion. The primary implication refers to the definition of significant exposure, which is defined as exposure totaling 10% or more of the regulatory capital and without the application of the required weighting factors. Previous regulations, on the other hand, identified significant exposures as the risk position - or the weighted exposure according to the required rules - totaling 10% or more of the regulatory capital. As a result, the amount and number of significant exposures as of 31 December 2010 increased significantly with respect to the value of 31 December 2009; however, this exclusively occurred as a result of a different regulatory framework.

320 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

The information on significant exposures, as required by the note of Bank of Italy, Prot. no. 0187292/11 dated 02.03.2011, is provided below with specifications of both book values as well as weighted values; in addition, a comparative value for 31.12.2009 is reported along with the new methodology. The consolidated significant exposures which were published in the annual report of 31.12.2009 (in accordance with the abovementioned regulations) totaled four in number, for an overall total amount of 314.134 thousand Euro.

Amounts of significant exposures in €/thousand

2010 2009 nominal weighted nominal weighted a) Amount 1,156,482 474,592 1,207,984 531,079 b) Number 13 13 13 13

Amounts of significant exposures in €/thousand

2010 2009 number nominal weighted number nominal weighted Impaired 1 116,326 116,326 1 113,977 113,977 Companies of the Group 2 366,523 91,269 2 346,344 43,151 Institutions 2 150,915 77 2 217,831 6,261 Banks 1 57,869 24,549 1 57,183 24,192 Clients 7 464,849 242,371 7 472,649 343,498 Total 13 1,156,482 474,592 13 1,207,984 531,079 NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 321 FINANCIAL YEAR 2010

C. ASSET SECURITIZATION AND TRANSFER OPERATIONS C.1 Securitization operations

Not applicable.

C.2 Transfer operations

C.2.1 Financial assets which were transferred but not cancelled

Financial Financial assets Financial assets assets Financial assets Categories/Portfolio held until Loans to Banks Loans to clients Total held for trading valuated at available for sale maturity fair value A B C A B C A B C A B C A B C A B C 2010 2009 A. Cash assets 1.Debt securities 7,306 - - - - - 31,822 2,653 2,986 2,287 47,054 218,641 2.Capital securities ------xxx xxx xxx - - 3.C.I.U. ------xxx xxx xxx - - 4.Loans ------B.Derivative - instruments ---xxx xxx xxx xxx xxx - - TOTAL 2010 7,306 - - - - - 31,822 - - 2,653 - - 2,986 - - 2,287 - 47,054 n/a Of which impaired ------TOTAL 2009 67,707 - - - - - 125,091 - - 39 - - 21,290 - - 4,514 - - n/a 218,641 Of which impaired ------

A = transferred financial assets that were fully booked (book value) B = transferred financial assets that were partially booked (book value) C = transferred financial assets that were partially booked (full value)

C.2.2 Financial liabilities relative to financial assets which were transferred but not cancelled The only financial liabilities related to financial assets which were transferred and not cancelled refer to operations of repurchase agreements.

Liability/Asset portfolio Financial assets Financial Financial Financial Loans Loans Total held for trading assets assets assets to Banks to clients valuated available held until at fair value for sale maturity

1. Payables due to clients NOTES TO THE FINANCIAL STATEMENTS - PART E a) in connection with fully booked assets 10,334 - 25,720 2,669 2,983 2,325 44,031 b) in connection with partially booked assets ------2. Payables due to banks a) in connection with fully booked assets ------b) in connection with partially booked assets ------TOTAL 2010 10,334 - 25,720 2,669 2,983 2,325 44,031 TOTAL 2009 68,991 - 125,257 40 21,103 4,597 219,988

322 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

C.3 Covered bond operations Not applicable.

D. MODELS FOR MEASURING CREDIT RISK

Refer to the information of qualitative nature on credit risk (2.2 Management, measurement and control system).

SECTION 2 - MARKET RISK

INFORMATION OF QUALITATIVE NATURE

For information of qualitative nature in relation to the measurement of market risks, refer to the description provided in the notes to the consolidated financial statement - Part E.

2.1 Interest rate and price risk - regulatory trading book

INFORMATION OF QUANTITATIVE NATURE

1. Regulatory trading book: Distribution by residual duration (re-pricing date) of financial assets and liabilities in cash and financial derivatives

This table has not been drafted given that an interest rate sensitivity analysis is supplied on the basis of internal models or other methodologies, such as those illustrated in point 3.

2. Regulatory trading book: Distribution of exposure in capital securities and stock indices within the primary countries of the listing market

This table has not been drafted given that an interest rate sensitivity analysis is supplied on the basis of internal models or other methodologies, such as those illustrated in point 3.

3. Regulatory trading book: internal models and other methodologies for sensitivity analysis

Interest rate risk The interest rate risk of the trading book is monitored in terms of Value at risk and scenario analysis. In particular, NOTES TO THE FINANCIAL STATEMENTS - PART E a sensitivity analysis is implemented; it allows the measurement of the values of positions within proprietary books following a “shock” to the interest rate curve. Parallel movements of 100 and 200 bp in the interest rate curve are taken into account. The effects on the earnings margin and the economic result were exclusively quantified for positions classified as HFT and whose mark to market changes are directly booked to the income statement.

Notes to the Financial Statements - Part E • 323 FINANCIAL YEAR 2010

Sensitivity analysis: trading book (Values expressed in €/thousand) Risk Scenario Effects on earnings margin/economic result Interest Rate Euro std + 100 bp -1,297 Interest Rate Euro std - 100 bp 1,433 Interest Rate Euro std + 200 bp -2,384 Interest Rate Euro std - 200 bp 3,071

Price and volatility risk The price risk of the trading book is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; it allows the measurement of the values of stock positions within proprietary books following changes in prices and volatility. The effects on the earnings margin and the economic result were exclusively quantified for positions classified as HFT and whose mark to market changes are directly booked to the income statement.

TRADING BOOK (Values expressed in €/thousand) Risk Scenario Effects on earnings margin/economic result Equity Equity -5% -226 Equity Equity +5% 226 Equity Equity -10% -453 Equity Equity +10% 453 Equity Equity -20% -906 Equity Equity +20% 906 Equity Equity -40% -1,813 Equity Equity +40% 1,813

(Values expressed in €/thousand) Risk Scenario Effects on earnings margin/economic result Volatility Volatility +5% 61 Volatility Volatility -5% -60

NOTES TO THE FINANCIAL STATEMENTS - PART E Volatility Volatility +10% 123 Volatility Volatility -10% -120

324 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

2.2 INTEREST RATE AND PRICE RISK - BANKING BOOK

INFORMATION OF QUANTITATIVE NATURE

1. Trading book: Distribution by residual duration (re-pricing date) of financial assets and liabilities. This table has not been drafted given that an interest rate sensitivity analysis is supplied on the basis of internal models or other methodologies, such as those illustrated in point 2.

2. Banking book: internal models and other methodologies for sensitivity analysis

Interest rate risk The interest rate risk of the banking book is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; this allows the measurement of the values of positions within proprietary books following a “shock” to the interest rate curve. Parallel movements of 100 and 200 bp in the interest rate curve are taken into account. The effects on shareholders’ equity are valuated for positions classified as AFS which affect assets unless significant or lasting impairment.

Sensitivity analysis: banking book (only debt securities of the AFS portfolio) (Values expressed in €/thousand) Risk Scenario Effects on earnings margin/economic result Interest Rate Euro std + 100 bp -3,601 Interest Rate Euro std - 100 bp 3,482 Interest Rate Euro std + 200 bp -7,015 Interest Rate Euro std - 200 bp 7,782

Sensitivity analysis: banking book (overall) (Values expressed in percentage points)

Risk index due to shift (+/-) + 200 bp -200 bp Economic value at risk / Tier 1 4.83% 4.83% Economic value at risk / Regulatory Capital 3.27% 3.27%

The sensitivity of Banca Intermobiliare presents a profile of exposure to interest rate risk due to an increase in interest NOTES TO THE FINANCIAL STATEMENTS - PART E rates. The economic value at risk is, in any case, fully compatible with both Tier 1 as well as with the Regulatory Capital and is significantly lower than the warning threshold defined by Basil II (20% with respect to the Regulatory Capital for a shift in interest rate curve of 200 bp).

Price risk The price risk of the banking book is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; this allows the measurement of the values of positions within proprietary books following changes in prices. The effects on shareholders’ equity are valuated for positions classified as AFS and which affect assets unless significant or lasting impairment that is considered significant or lasting.

Notes to the Financial Statements - Part E • 325 FINANCIAL YEAR 2010

BANKING BOOK (Values expressed in €/thousand)

Risk Scenario Effects on earnings margin/economic result Equity Equity -5% -1,368 Equity Equity +5% 1,368 Equity Equity -10% -2,736 Equity Equity +10% 2,736 Equity Equity -20% -5,472 Equity Equity +20% 5,472 Equity Equity -40% -10,944 Equity Equity +40% 10,944 NOTES TO THE FINANCIAL STATEMENTS - PART E

326 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

2.3 EXCHANGE RATE RISK

INFORMATION OF QUALITATIVE NATURE

For information of qualitative nature in relation to the measurement of exchange rate risk, refer to the description provided in the consolidated Explanatory Notes - Part E.

INFORMATION OF QUANTITATIVE NATURE

1. Distribution of assets, liabilities and derivatives by currency of denomination

Items Currencies USD Pounds Yen Canadian Swiss Francs Other Dollars currencies A. Financial assets A.1 Debt securities 30 - - - - - A.2 Equity securities 4,567 855 - - 1,096 5 A.3 Loans to banks 3,775 994 215 10,013 462 3,489 A.4 Loans to clients 17,832 1,145 2,580 3,374 16,454 3,011 A.5 Other financial assets ------B. Other assets - - - - - 800 C. Financial liabilities C.1 Payables due to banks (908) (4) (4,935) (412) (11,587) (41) C.2 Payables due to clients (14,781) (1,568) (75) (381) (1,982) (2,576) C.3 Debt securities (6,003) - - - (5,147) (6,609) C.4 Other financial liabilities ------D. Other liabilities (10,612) - (1,283) - - ( 240) E. Financial derivatives - Options + Long positions 1,927,451 14,064 18,838 2,836 76,633 310,346 + Short positions (1,927,287) (14,064) (18,838) (2,836) (76,633) (310,346) - Other + Long positions 338,573 1,463 18,115 2,290 49,618 22,293 + Short positions (324,235) (2,388) (15,683) (14,750) (47,752) (15,042)

Total assets 2,292,228 18,521 39,748 18,513 144,263 339,944 NOTES TO THE FINANCIAL STATEMENTS - PART E Total liabilities (2,283,826) (18,024) (40,814) (18,379) (143,101) (334,854) Unbalance (+/-) 8,402 497 (1,066) 134 1,162 5,090

2. Internal models and other methodologies for sensitivity analysis The exchange rate risk of the trading book is monitored in terms of Value at risk and scenario analysis. In particular, a sensitivity analysis is implemented; this allows the measurement of the values of positions within proprietary books following a change in exchange rates and volatility of +/- 1%. The effects on the earnings margin and the economic result were exclusively quantified for positions classified as HFT and whose mark to market changes are directly booked to the income statement.

Notes to the Financial Statements - Part E • 327 FINANCIAL YEAR 2010

Sensitivity analysis: trading book (Values expressed in €/thousand

Risk Scenario Effects on earnings margin/economic result Forex +1% exchange rates versus EURO 0 Forex -1% exchange rates versus EURO 0 Forex +1% forex volatility 0 Forex -1% forex volatility 0

2.4 DERIVATIVE INSTRUMENTS

A. Financial Derivatives

A.1 Regulatory trading book: average and period-ending notional values

2010 2009 Underlying assets/types Over Central Over Central of derivatives the counter Counterparties the counter Counterparties 1. Debt securities and interest rates a) Options - - - - b) Swaps 419,564 - 424,776 - c) Forwards - 1,401 - 107 d) Futures - 3,137 - - e) Other - - - - 2. Equity securities and stock indices - - a) Options 173,919 109,037 72,804 16,729 b) Swaps - - - - c) Forwards 8,240 5,248 - 376 d) Futures - - 6,450 - e) Other 7,477 - 402 - 3. Currencies and gold - - a) Options 9,242,694 - 5,694,311 - NOTES TO THE FINANCIAL STATEMENTS - PART E b) Swaps 36,217 - 4,234 - c) Forwards 517,443 - 250,932 - d) Futures - - - - e) Other - - - - 4. Goods 7,034 - 629,175 - 5. Other underlying assets - - - - Total 10,412,588 118,823 7,083,084 17,212 Average values* n/d n/d n/d n/d

* Average values not available

328 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

A.2 Banking book: average and period-ending notional values

A.2.1 For hedging

As at 31.12.2010 , the parent company did not have hedging derivatives relative to the banking book.

A.2.2 Other derivatives

2010 2009

Underlying assets/types Over Central Over Central of derivatives the counter Counterparties the counter Counterparties 1. Debt securities and interest rates a) Options - - - - b) Swaps - - - - c) Forwards - - - - d) Futures - - - - e) Other - - - - 2. Equity securities and stock indices - - - - a) Options - - - - b) Swaps - - - - c) Forwards - 10 - - d) Futures - - - - e) Other - - - - 3. Currencies and gold - - - - a) Options - - - - b) Swaps - - - - c) Forwards - - - - d) Futures - - - - e) Other - - - - 4. Goods - - - - 5. Other underlying assets - - - - Total - 10 - - Average values* n/d n/d n/d n/d

* Average values not available NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 329 FINANCIAL YEAR 2010

A.3 Financial derivatives: gross positive fair value - breakdown by product

Positive fair value 2010 2009 Books/types Over Central Over Central of derivatives the counter Counterparties the counter Counterparties A. Regulatory trading book a) Options 102,276 25,854 64,440 1,973 b) Interest rate swaps 2,388 - 3,956 - c) Cross currency swaps 1,745 - 12 - d) Equity swaps - - - - e) Forwards 4,689 83 2,559 - f) Futures - 11 572 - g) Other 1,218 - - - B. Banking book - for hedging a) Options - - - - b) Interest rate swaps - - - - c) Cross currency swaps - - - - d) Equity swaps - - - - e) Forwards - - - - f) Futures - - - - g) Other - - - - C. Banking book - other derivatives a) Options - - - - b) Interest rate swaps - - - - c) Cross currency swaps - - - - d) Equity swaps - - - - e) Forwards - - - - f) Futures - - - - g) Other - - - - Total 112,316 25,948 74,321 1,977 NOTES TO THE FINANCIAL STATEMENTS - PART E

330 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

A.4 Financial derivatives: gross negative fair value - breakdown by product

Negative fair value 2010 2009 Books/types Over Central Over Central of derivatives the counter Counterparties the counter Counterparties A. Regulatory trading book a) Options 105,015 24,792 65,256 226 b) Interest rate swaps 4,688 - 8,930 - c) Cross currency swaps 639 - 5 - d) Equity swaps - - - - e) Forwards 3,774 65 2,896 4 f) Futures - 7 15 - g) Other 7 - 12 - B. Banking book - for hedging a) Options - - - - b) Interest rate swaps - - - - c) Cross currency swaps - - - - d) Equity swaps - - - - e) Forwards - - - - f) Futures - - - - g) Other - - - - C. Banking book - other derivatives a) Options - - - - b) Interest rate swaps - - - - c) Cross currency swaps - - - - d) Equity swaps - - - - e) Forwards - - - - f) Futures - - - - g) Other - - - - Total 114,123 24,864 77,114 230 NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 331 FINANCIAL YEAR 2010

A.5 OTC financial derivatives: regulatory trading book - positive and negative gross notional & fair values by counterparty - contracts not falling under clearing agreements

Contracts not falling under Governments Other Banks Financial Insurance Non- Other clearing agreements and central public companies companies financial parties banks entities companies 1. Debt securities and interest rates - notional value - - 304,497 74,989 - 27,405 - - positive fair value - - 955 862 - 461 - - negative fair value - - 3,596 942 - 111 - - future exposure - - 1,255 100 - 113 - 2. Equity securities and stock indices - notional value - - 19,583 15,159 - 714 154,180 - positive fair value - - - 1,215 - 2 6 - negative fair value - - 1,993 7 - 1 635 - future exposure - - 180 425 - 43 11 3. Currencies and gold - notional value - - 5,212,784 624,422 - 50,160 84,331 - positive fair value - - 42,360 11,950 - 573 1,506 - negative fair value - - 70,412 8,483 - 562 757 - future exposure - - 23,765 3,414 - 502 880 4. Other valuables - notional value - - 5,357 - - - 180 - positive fair value - - 312 - - - 51 - negative fair value - - 367 - - - - - future exposure - - 18 - - - 2 NOTES TO THE FINANCIAL STATEMENTS - PART E

332 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

A.6 OTC financial derivatives: regulatory trading book - positive and negative gross notional & fair values by counterparty - contracts falling under clearing agreements

Contracts falling under clearing Governments Other Banks Financial Insurance Non- Other agreements and central public companies companies financial parties banks entities companies 1. Debt securities and interest rates - notional value - --- - 12,673 - - positive fair value - --- - 110 - - negative fair value - --- - 40 - 2. Equity securities and stock indices - notional value ------positive fair value ------negative fair value ------3. Currencies and gold - - notional value - --- - 3,824,656 - - positive fair value - --- - 51,948 - - negative fair value - --- - 26,217 - 4. Other valuables - notional value - --- - 1,497 - - positive fair value - --- - 5 - - negative fair value ------NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 333 FINANCIAL YEAR 2010

A.7 otc financial derivatives: banking book - positive and negative gross notional & fair values by counterparty - contracts not falling under clearing agreements Not applicable.

A.8 otc financial derivatives: banking book - positive and negative gross notional & fair values by counterparty - contracts falling under clearing agreements

Not applicable. NOTES TO THE FINANCIAL STATEMENTS - PART E

334 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

A.9 Residual life of OTC financial derivatives: notional values

Underlying assets / Residual duration Up to one year Beyond one Beyond five Total year and up years to five years A. Regulatory trading book A.1 Financial derivatives on debt securities and interest rates 186,526 198,827 34,212 419,565 A.2 Financial derivatives on equity securities and stock indices 31,781 157,005 850 189,636 A.3 Financial derivatives on exchange rates and gold 9,678,864 117,490 - 9,796,354 A.4 Financial derivatives on other valuables 7,033 - - 7,033 B. Banking book B.1 Financial derivatives on debt securities and interest rates - - - - B.2 Financial derivatives on equity securities and stock indices - - - - B.3 Financial derivatives on exchange rates and gold - - - - B.4 Financial derivatives on other valuables - - - - Total 2010 9,904,204 473,322 35,062 10,412,588 Total 2009 6,609,165 364,714 109,206 7,083,086

A.10 OTC financial derivatives: counterparty risk/financial risk - Internal Models

Banca Intermobiliare does not use internal models of the EPE type for the purposes of measuring counterparty and financial risk; instead, the bank uses a method based on current values.

B. Credit Derivatives B.1 Credit derivatives: average and period-ending notional values

Categories of operations Regulatory trading book Banking book On a single On multiple On a single On multiple party parties (basket) party parties (basket) 1. Protection buyers a) Credit default products 73,945 7,500 - - b) Credit spread products - - - - c) Total rate of return swaps - - - - d) Other - - - - 2010 Total 73,945 7,500 - - Average values* n/d n/d n/d n/d

2009 Total 69,700 5,000 - - NOTES TO THE FINANCIAL STATEMENTS - PART E 2. Protective sales a) Credit default products 26,245 5,000 - - b) Credit spread products - - - - c) Total rate of return swaps - - - - d) Other - - - - 2010 Total 26,245 5,000 Average values* n/d n/d n/d n/d 2009 Total 53,000 5,000 - - * Average values not available Credit derivatives refer to Credit Default Swaps with underlying bond securities.

Notes to the Financial Statements - Part E • 335 FINANCIAL YEAR 2010

B.2 OTC Credit derivatives: gross positive fair value - breakdown by product

Positive fair value Books/types of derivatives 2010 2009 1. Regulatory trading book a) Credit default products 813 657 b) Credit spread products - - c) Total rate of return swaps - - d) Other - - 2. Banking book - for hedging a) Credit default products - - b) Credit spread products - - c) Total rate of return swaps - - d) Other - - Total 813 657

B.3 OTC Credit derivatives: gross negative fair value - breakdown by product

Negative fair value Books/types of derivatives 2010 2009 1. Regulatory trading book a) Credit default products 1,526 1,364 b) Credit spread products - - c) Total rate of return swaps - - d) Other - - 2. Banking book - for hedging a) Credit default products - - b) Credit spread products - - c) Total rate of return swaps - - d) Other - - Total 1,526 1,364 NOTES TO THE FINANCIAL STATEMENTS - PART E

336 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

B.4 OTC credit derivatives: (positive and negative) gross fair values by counterparty - contracts not falling under clearing agreements

Contracts not falling under Governments Other Banks Financial Insurance Non- Other clearing agreements and central public companies companies financial parties banks entities companies Regulatory trading book 1. Protection buyers - notional value - - 51,500 7,700 - 2,245 - - positive fair value - - 209 - - 492 - - negative fair value - - 780 38 - - - - future exposure - - 4,400 770 - 225 - 2. Protective sales - notional value - - 30,245 1,000 - - - - positive fair value - - - 73 - - - - negative fair value - - 708 - - - - - future exposure - - 2,025 100 - - - Banking portfolio 1. Protection buyers - notional value ------positive fair value ------negative fair value ------2. Protective sales - notional value ------positive fair value ------negative fair value ------NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 337 FINANCIAL YEAR 2010

B.5 OTC credit derivatives: (positive and negative) gross fair values by counterparty - contracts falling under clearing agreements

Contracts falling under clearing Governments Other Banks Financial Insurance Non- Other agreements and central public companies companies financial parties banks entities companies Regulatory trading book 1. Protection buyers - notional value - -- - 20,000 - - positive fair value - -- - 39 - - negative fair value ------2. Protective sales - notional value ------positive fair value ------negative fair value ------Banking portfolio 1. Protection buyers - notional value ------positive fair value ------negativefair value ------2. Protective sales - notional value ------positive fair value ------negative fair value ------

B.6 Residual life of credit derivatives: notional values

Underlying assets / Residual duration Up to one year Beyond one Beyond five Total year and up years to five years A. Regulatory trading book A.1 Derivatives on loans with qualified reference obligation 40,000 15,000 - 55,000 A.2 Derivatives on loans with non-qualified reference obligation - 57,690 - 57,690

NOTES TO THE FINANCIAL STATEMENTS - PART E B. Banking book B.1 Derivatives on loans with qualified reference obligation - - - - B.4 Derivatives on loans with non-qualified reference obligation - - - - 2010 Total 40,000 72,690 - 112,690 2009 Total 32,000 95,700 5,000 132,700

338 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

B.7 credit derivatives: counterparty risk/financial risk - Internal Models

Banca Intermobiliare does not utilize internal models of the EPE type for the purposes of measuring counterparty and financial risk; instead, the bank uses a method based on current values.

C. Financial And Credit Derivatives

C.1 OTC financial and credit derivatives: net fair values and future exposures for counterparties

Governments Other Banks Financial Insurance Non- Other and central public companies companies financial parties banks entities companies 1) Bilateral agreement: financial derivatives - positive fair value ------negative fair value ------future exposure ------net counterparty risk ------2) Bilateral agreement: credit derivatives - positive fair value ------negative fair value ------future exposure ------net counterparty risk ------3) "Cross product" agreements - positive fair value - -- - - 25,844 - - negative fair value ------future exposure - -- - - 17,433 - - net counterparty risk ------NOTES TO THE FINANCIAL STATEMENTS - PART E

Notes to the Financial Statements - Part E • 339 FINANCIAL YEAR 2010

SECTION 3 - LIQUIDITY RISK

INFORMATION OF QUANTITATIVE NATURE

1. Temporal distribution by contractual residual duration of financial assets and liabilities

Currency of denomination: Euro

Items/temporal brackets On demand From From From From From From From Beyond Indefinite beyond 1 beyond 7 beyond 15 beyond 1 beyond 3 beyond 6 beyond 1 five years duration day to 7 days to 15 days to 1 month to 3 month to 6 month to 1 year to 5 days days month months months year years Cash assets A.1 Government securitites - 10 - - 2,504 12,237 4,735 49,119 1,887 - A.2 Debt securities 115 - 1,492 12,482 44,850 44,993 29,063 260,205 97,740 - A.3 Quotas of CIU’s ------60,684 - A.4 Loans - Banks 49,563 - - 55,659 25,000 - - - 9,727 10,590 - Clients 1,056,246 - - 9,055 13,185 11,435 40,272 305,208 430,840 - Cash liabilities B.1 Deposits and bank accounts - Banks (143,229) - (3,000) (5,500) (40,000) (13,605) - - - - - Clients (1,349,709) - - (497) ------B.2 Debt securities - - - - - (19,835) (52,390) (306,747) (32,009) - B.3 Other liabilities (7,491) (36,169) (55,078) (115,862) (319,313) (5,377) (45) - (2,255) - “Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 35,579 24,241 47,415 242,240 126,631 85,100 643 183 - - Short positions - (42,248) (11,624) (51,878) (227,911) (125,201) (85,304) (25,787) (3,236) - C.2 Financial derivatives without capital exchanges - Long positions 3,605 ------NOTA INTEGRATIVA INDIVIDUALE - PARTE E - Short positions (6,471) ------

NOTES TO THE FINANCIAL STATEMENTS - PART E C.3 Deposits and receivable loans - Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds - Long positions 200 - - - - 20,000 - 33,923 22,787 - - Short positions (52,910) - - - - (20,000) - (9,000) - - C.5 Issued financial guarantees 457 132 - 2,978 2,621 2,188 11,607 36,810 9,260 -

340 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

Currency of denomination: Usd

Items/temporal brackets On demand From From From From From From From Beyond Indefinite beyond 1 beyond 7 beyond 15 beyond 1 beyond 3 beyond 6 beyond 1 five years duration day to 7 days to 15 days to 1 month to 3 month to 6 month to 1 year to 5 days days month months months year years Cash assets A.1 Government securitites ------17 - A.2 Debt securities ------A.3 Quotas of CIU’s ------A.4 Loans - Banks 3,775 ------Clients 16,067 - - 1,370 - 225 - - 238 - Cash liabilities B.1 Deposits and bank accounts - Banks (908) ------Clients (13,258) ------B.2 Debt securities ------(5,990) - - B.3 Other liabilities ------“Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 138,651 134,900 124,573 767,754 516,107 516,704 8,258 - - - Short positions - (133,159) (135,554) (119,465) (771,237) (516,327) (516,704) - - - C.2 Financial derivatives without capital exchanges - Long positions 1,852 ------Short positions (2,314) ------C.3 Deposits and receivable loans ------Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds - Long positions ------

- Short positions ------(2,245) - - NOTES TO THE FINANCIAL STATEMENTS - PART E C.5 Issued financial guarantees ------

Notes to the Financial Statements - Part E • 341 FINANCIAL YEAR 2010

Currency of denomination: Gbp

Items/temporal On demand From From From From From From From Beyond Indefinite brackets beyond 1 beyond 7 beyond 15 beyond 1 beyond 3 beyond 6 beyond 1 five years duration day to 7 days to 15 days to 1 month to 3 month to 6 month to 1 year to 5 days days month months months year years Cash assets A.1 Government securitites ------A.2 Debt securities ------A.3 Quotas of CIU’s ------A.4 Loans - Banks 994 ------Clients 1,150 ------Cash liabilities B.1 Deposits and bank accounts - Banks (4) ------Clients (1,568) ------B.2 Debt securities ------B.3 Other liabilities ------“Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 44 - 290 12,465 116 - - - - - Short positions - (138) - (292) (13,294) (116) - - - - C.2 Financial derivatives without capital exchanges - Long positions 16 ------Short positions (7) ------C.3 Deposits and receivable loans ------Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds ------Long positions ------

NOTES TO THE FINANCIAL STATEMENTS - PART E - Short positions ------C.5 Issued financial guarantees ------

342 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

Currency of denomination: Yen

Items/temporal On demand From From From From From From From Beyond Indefinite brackets beyond 1 beyond 7 beyond 15 beyond 1 beyond 3 beyond 6 beyond 1 five years duration day to 7 days to 15 days to 1 month to 3 month to 6 month to 1 year to 5 days days month months months year years Cash assets A.1 Government securitites ------A.2 Debt securities ------A.3 Quotas of CIU’s ------A.4 Loans - Banks 215 ------Clients 1,211 - - 43 547 486 - - 315 - Cash liabilities B.1 Deposits and bank accounts - Banks (11) - - - (4,924) ------Clients (75) ------B.2 Debt securities ------B.3 Other liabilities ------“Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 10 2,577 2,898 16,086 14,265 1,117 - - - - Short positions - - (2,577) (4,368) (11,710) (14,749) (1,117) - - - C.2 Financial derivatives without capital exchanges ------Long positions ------Short positions ------C.3 Deposits and receivable loans ------Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds ------Long positions ------

- Short positions ------NOTES TO THE FINANCIAL STATEMENTS - PART E C.5 Issued financial guarantees ------

Notes to the Financial Statements - Part E • 343 FINANCIAL YEAR 2010

Currency of denomination: Cad

Items/temporal On demand From From From From From From From Beyond Indefinite brackets beyond 1 beyond 7 beyond 15 beyond 1 beyond 3 beyond 6 beyond 1 five years duration day to 7 days to 15 days to 1 month to 3 month to 6 month to 1 year to 5 days days month months months year years Cash assets A.1 Government securitites ------A.2 Debt securities ------A.3 Quotas of CIU’s ------A.4 Loans - Banks 67 - - - 9,946 ------Clients 3,409 ------Cash liabilities B.1 Deposits and bank accounts - Banks (412) ------Clients (381) ------B.2 Debt securities ------B.3 Other liabilities ------“Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 638 21 - 1,651 2,815 - - - - - Short positions - - (2,536) - (12,235) (2,815) - - - - C.2 Financial derivatives without capital exchanges ------Long positions ------Short positions ------C.3 Deposits and receivable loans ------Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds - Long positions - 638 ------

NOTES TO THE FINANCIAL STATEMENTS - PART E NOTES TO THE FINANCIAL STATEMENTS - PART E - Short positions - (638) ------C.5 Issued financial guarantees ------

344 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010

Currency of denomination: Chf

Items/temporal On demand From From From From From From From Beyond Indefinite brackets beyond 1 beyond 7 beyond 15 beyond 1 beyond 3 beyond 6 beyond 1 five years duration day to 7 days to 15 days to 1 month to 3 month to 6 month to 1 year to 5 days days month months months year years Cash assets A.1 Government securitites ------A.2 Debt securities ------A.3 Quotas of CIU’s ------A.4 Loans - Banks 90 ------372 - - Clients 6,691 - - - 1,285 7,849 - - 773 - Cash liabilities B.1 Deposits and bank accounts - Banks (391) - - - (11,196) ------Clients (862) ------B.2 Debt securities ------(5,143) - - B.3 Other liabilities ------“Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 15,938 - 8,768 66,459 18,502 9,902 6,680 - - - Short positions - (15,989) (4,736) (8,769) (66,487) (18,502) (9,902) - - - C.2 Financial derivatives without capital exchanges ------Long positions ------Short positions ------C.3 Deposits and receivable loans ------Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds ------Long positions ------

- Short positions ------NOTES TO THE FINANCIAL STATEMENTS - PART E C.5 Issued financial guarantees ------

Notes to the Financial Statements - Part E • 345 FINANCIAL YEAR 2010

Currency of denomination: Other

Items/tempora On demand From From From From From From From Beyond Indefinite brackets beyond 1 beyond 7 beyond 15 beyond 1 beyond 3 beyond 6 beyond 1 five years duration day to 7 days to 15 days to 1 month to 3 month to 6 month to 1 year to 5 days days month months months year years Cash assets A.1 Government securitites ------A.2 Debt securities ------A.3 Quotas of CIU’s ------A.4 Loans - Banks 3,489 ------Clients 486 ------2,525 - Cash liabilities B.1 Deposits and bank accounts - Banks (41) ------Clients (2,250) ------B.2 Debt securities ------(6,516) - - B.3 Other liabilities ------“Off-balance sheet” operations C.1 Financial derivatives with capital exchanges - Long positions - 108 29,404 20,483 44,402 18,576 411 11,489 - - - Short positions - (386) (34,203) (19,727) (44,402) (18,576) (151) (175) - - C.2 Financial derivatives without capital exchanges - Long positions 2,558 ------Short positions (2,063) ------C.3 Deposits and receivable loans - Long positions ------Short positions ------C.4 Irrevocable commitments to issue funds

NOTA INTEGRATIVA INDIVIDUALE - PARTE E - Long positions ------

NOTES TO THE FINANCIAL STATEMENTS - PART E NOTES TO THE FINANCIAL STATEMENTS - PART E - Short positions ------C.5 Issued financial guarantees ------

SECTION 4 - OPERATIONAL RISKS

For information relative to modalities for identifying and monitoring operational risks, refer to the description provided in the consolidated Explanatory Notes - Part E.

346 • Notes to the Financial Statements - Part E FINANCIAL YEAR 2010 Part F - INFORMATION ON EQUITY

SECTION 1 - COMPANY EQUITY

A. QUALITATIVE INFORMATION See Part F “Information on consolidated equity,” Section 1 “Qualitative information” in the notes to the consolidated financial statements”.

B . QUANTITATIVE INFORMATION B.1 Company equity: breakdown

Items/Amounts 2010 2009 1. Share capital 156,209 156,038 2. Issue premiums - 140 3. Reserves - profit reserves a) legal reserve 31,128 31,128 b) statutory reserve - - c) treasury shares 115,535 - d) other 30,706 31,313 - other 14,131 129,140 4. Equity instruments 30,023 30,023 5. (Treasury shares) (34,416) (33,802) 6. Valuation reserves: - Financial assets available for sale (3,322) 2,500 - Tangible fixed assets - - - Intangible fixed assets - - - Foreign investment hedges - - - Cash flow hedges - - - Exchange differences - - - Non-current assets held for sale - - - Actuarial gains (losses) on defined benefit pension plans - - - Portion of valuation reserves related to investee companies accounted NOTES TO THE FINANCIAL STATEMENTS - PART F for using the equity method - - - Special revaluation laws - - 7. Profit (loss) for the year 13,872 (607) Total 353,866 345,873

Notes to the Financial Statements - Part F • 347 FINANCIAL YEAR 2010

B.2 Valuation reserve for financial assets available for sale: breakdown

2010 2009

Assets/Amounts Positive reserve Negative reserve Positive reserve Negative reserve

1. Debt securities 165 (1,728) 2,498 (1,498) 2. Equity securities 1,603 (2,347) 3,866 (468) 3. UCI units 1,258 (2,273) 813 (2,711) 4. Loans - - - - Total 3,026 (6,348) 7,177 (4,677)

B.3 Valuation reserve for financial assets available for sale: annual changes

Debt securities Equity securities UCI units Loans 1. Opening balance 1,000 3,398 (1,898) - 2. Increases 2.1 Increases in fair value 1,523 1,041 1,683 - 2.2 Transfer of negative reserves to income statement for impairment - 1,050 - - for a sale - - 32 - 2.3 Other changes 1,721 1,226 133 - 3. Decreases 3.1 Decreases in fair value (4,074) (3,449) (411) - 3.2 Write-downs for impairment - 3.3 Transfer of positive reserves to income statement: for a sale (1,236) (3,915) - - 3.4 Other changes (497) (95) (554) - 4. Net closing balance (1,563) (744) (1,015) - NOTA INTEGRATIVA INDIVIDUALE - PARTE F NOTES TO THE FINANCIAL STATEMENTS - PART F NOTES TO THE FINANCIAL STATEMENTS - PART F

348 • Notes to the Financial Statements - Part F FINANCIAL YEAR 2010

SECTION 2 - EQUITY AND ADEQUACY RATIOS

2.1 sUPERVISORY CAPITAL

A. qualitative INFORMATION

See Part F of the notes to the consolidated financial statements for qualitative information on equity and corresponding management policies. In the case of individual supervisory capital, unlike the corresponding consolidated figure, the entire subordinated bond, which corresponds to the convertible bond issued by Banca Intermobiliare, can be included in tier II capital. Thus, there are no capital elements falling under tier III capital.

B. quantitative INFORMATION

31.12.2010 31.12.2009 A. Tier I capital prior to application of prudential filters 325,315 311,140 B. Prudential filters of tier I capital: - - B.1 Positive IAS/IFRS prudential filters (+) - - B.2 Negative IAS/IFRS prudential filters (-) 2,861 - C. Tier I capital inclusive of the elements to be deducted (A+B) 322,454 311,140 D. Deduction from Tier I capital 1,205 31 E. Total tier I capital (C-D) 321,249 311,110 F. Tier II capital prior to application of prudential filters 117,403 150,923 G. Prudential filters of tier II capital: - - G.1 Positive IAS/IFRS prudential filters (+) - - G.2 Negative IAS/IFRS prudential filters (-) 37 1,250 H. Tier II Capital inclusive of the elements to be deducted (F+G) 117,366 149,673 I. Deduction from Tier II capital 1,205 31 L. Total tier II capital (H-I) 116,161 149,642 M. Deductions from tier I and II capital 5,438 5,438 N. Supervisory capital (E + L - M) 431,972 455,314 O. Tier III capital - - P. Supervisory capital including tier III (N + O) 431,972 455,314 NOTES TO THE FINANCIAL STATEMENTS - PART F

2.2 CAPITAL ADEQUACY

A. QUALITATIVE INFORMATION

All minimum requirements for supervisory purposes were calculated in accordance with Circular 263, which, for such requirements, entered into force in March 2008. These requirements include credit and counterparty risk, now joined under a single item; market risk; the new requirement for “operational risk,” meaning “the risk of incurring losses resulting from the inadequacy or failure of procedures, human resources and internal systems, or from exogenous events”; lastly, other requirements.

Notes to the Financial Statements - Part F • 349 NOTES TO THE FINANCIAL STATEMENTS - PART BF 350 •Notesto the FinancialStatements -PartF (Total capitalratio) 3/Weighted risk assets C.3 CapitalforsupervisorypurposesincludingTier 1capitalratio) Icapital/Weighted riskassets(Tier C.2 Tier C.1 Weighted riskassets C. RISKASSETSANDCAPITAL RATIOS B.6 Total minimumrequirements B.5 Othercalculationelements B.4 Otherminimumrequirements 3. Advancedmethod 2. Standardised method 1. Basicmethod B.3 Operationalrisk 3. Concentrationrisk 2. Internal models 2. Internal 1. Standard methodology B.2 Marketrisk B.1 Credit andcounterpartyrisk B. SUPERVISORY CAPITAL REQUIREMENTS 3. Securitisations 2.1 Advanced A.1 Cr A. RISKASSETS 26.06%, which are higher than the minimum requirement of 8%.. had a ratio of tier I capital to weighted risk assets of 19.38%,As andindicated a ratio in of the supervisory table on thecapital breakdown to weighted of capital risk forassets supervisory of purposes and risks, as at 31 December 2010 the Bank Intermobiliare is the parent company of a banking group. Individual capital requirements for credit, counterparty, market and operational risk are reduced by 25% since Banca credit and counterparty risk from the level at 31 December 2009the was effect due to of the a reductionselection inof creditthis method. risk brought about by a financialintegral guarantee. method rather The reductionthan the simplifiedin the capital method. requirement This methodology for With makes regard it possibleto credit to risk take mitigation, more directly Banca into Intermobiliare account decidedbase method. that starting 31 December 2010 it would adopt the Credit and counterparty risk was calculated using standardised methods, while operational risk was calculated using the 2.1 Basic ratingsmethod 2. Internal 1. Standardised methodology Categories/Amounts B . FINANCIAL YEAR2010 quantitative edit andcounterpartyrisk

INFORMATION 11.003.220 11.0031.12.2009 31.12.2010 31.12.2009 31.12.2010 ,9,7 ,2,2 ,6,3 2,042,579 1,865,539 3,227,023 2,991,576 negtdrss Required/weighted Unweighted risks ------,5,3 1,887,596 1,657,437 3,9 151,008 132,595 4,4 163,406 149,243 61%24.12% 16.48% 26.15% 19.38% 50922,382 15,059 24215,555 12,492 amounts ------

NOTA INTEGRATIVA INDIVIDUALE - PARTE F FINANCIAL YEAR 2010 Part G - BUSINESS COMBINATIONS REGARDING COMPANIES OR COMPANY DIVISIONS

During the year there were no business combinations regarding companies or company divisions.

Part H - RELATED PARTY TRANSACTIONS

Notion of related party for Banca Intermobiliare See Part H of the notes to the consolidated financial statements for qualitative information on the notion of related parties for Banca Intermobiliare.

Information on compensation paid to directors, statutory auditors and executives with strategic responsibility Thousands of €)

Last and Position Time Expiration of position Remuneration Non-cash Bonus Other Share-based first name in position for position benefits and compen- pmts. at company other sation preparing fin. incentives statmts a) Directors

Ruozi Roberto Chairman BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 120 30 Ruozi Roberto Director BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 6 2 Trinca Flavio Vice-Chairman BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 70 - D'Agui' Pietro CEO BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 320 - D'Agui' Pietro CEO BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 98 Terzoli Luigi Director BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 20 - Malvestio Massimo Director BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 20 - Ceccato Angelo Director BIM S.p.A. 01/01/10-31/12/10 Approval of 2012 fin. stat. 20 30 Consoli Vincenzo Director BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 20 - Cordero Di Director BIM S.p.A. Montezemolo Matteo 23/4/10-31/12/10 Approval of 2012 fin. stat. 20 - Santonocito Giuseppe Director BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 20 25 Santonocito Giuseppe Director BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 6 8 Antiga Franco Director BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 20 - Cortese Mauro Director BIM S.p.A. 23/4/10-31/12/10 Approval of 2012 fin. stat. 20 30 Bruna in Segre Franca Chairman BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 98 - Scanferlin Mario Vice-Chairman BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 52 - Giovannone

Director BIM S.p.A. NOTES TO THE FINANCIAL STATEMENTS - PART G and H Gianclaudio 01/01/10-23/4/10 Approval of 2009 fin. stat. 52 - Segre Massimo Director BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 8 - Cerri Pietro Angelo Director BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 8 11 Dezzani Flavio Director BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 8 10 Girard Franco Director BIM S.p.A. 01/01/10-23/4/10 Approval of 2009 fin. stat. 6 2 TOTAL COMPENSATION PAID TO DIRECTORS 1,012 - - 148 -

Notes to the Financial Statements - Part G and H • 351 FINANCIAL YEAR 2010

Last and first name Position Time in position Expiration of Remuneration Non-cash Bonus Other Share-based position for position benefits and other compen- pmts. at company incentives sation preparing fin. statmts b) Statutory Auditors De Poi Paolo Chairman BIM S.p.A. 25/6/10-31/12/10 Approval of 2012 30 fin. stat. D'Imperio Roberto Regular auditor of BIM 25/6/10-31/12/10 Approval of 2012 20 S.p.A. fin. stat. Andolfato Paolo Regular auditor of BIM 25/6/10-31/12/10 Approval of 2012 20 S.p.A. fin. stat. Bertarelli Stefano Deputy auditor of BIM 25/6/10-31/12/10 Approval of 2012 - S.p.A. fin. stat. Pezzetta Marco Deputy auditor of BIM 25/6/10-31/12/10 Approval of 2012 - S.p.A. fin. stat. Rocca Paolo Riccardo Chairman and regular auditor of Bim 1/1/10-25/6/10 Early resignation 19 Macchiorlatti Vignat Luigi Regular auditor of Bim 1/1/10-23/4/10 Early resignation 8 Malvestio Massimo Regular auditor of Bim 1/1/10-6/4/10 Early resignation 6 Manacorda Fabrizio Deputy auditor of Bim 1/1/10-6/4/10 Early resignation - Manacorda Fabrizio Regular auditor of Bim 6/4/10-25/6/10 Early resignation 6 Mazzoccato Martino Deputy auditor of Bim 1/1/10-23/4/10 Early resignation - Mazzoccato Martino Regular auditor of Bim 23/4/10-25/6/10 Early resignation 4 TOTAL COMPENSATION PAID TO STATUTORY AUDITORS 113 - - - - C) EXECUTIVES WITH STRATEGIC RESPONSIBILITY 1,146 - 412 - - TOTAL COMPENSATION PAID TO EXECUTIVES WITH STRATEGIC RESPONSIBILITY 2,271 - 412 - -

Since Article 78 of Issuer’s Regulation No. 11971, which was not repealed with the introduction of IAS/IFRS and still remains in effect for listed Italian companies, the recording of remuneration and changes of various sorts required by IAS 24 is additional to information already required by Consob with reference to remuneration paid to directors and statutory auditors, which must continue to be provided by name using the table specified in Appendix 3C of the aforementioned regulation. All compensation indicated in the table includes any ancillary charges payable by the company (provision to employees’ severance fund and social security contributions). “Other compensation” includes remuneration received by directors and statutory auditors for positions held in other NOTES TO THE FINANCIAL STATEMENTS - PART H

NOTES TO THE FINANCIAL STATEMENTS - PART F Group companies.

352 • Notes to the Financial Statements - Part H FINANCIAL YEAR 2010

Equity investments of directors, statutory auditors and executives with strategic responsibility The table below indicates equity investments in Banca Intermobiliare S.p.A. held directly or indirectly by directors, statutory auditors and executives with strategic responsibility as dictated by Article 79 of Issuers Regulation No. 11971.

Last and first name Company No. of shares No. of shares No. of shares No. of shares owned held at end of purchased sold held at end of previous year current year Cofito S.p.A. (1) BIM 82,080,000 15,000 -15,000 82,080,000 Franca Bruna Segre (2) BIM 182,300 - , 182,300 Massimo Segre (2) (3) BIM 24,000 - - 24,000 Executives with strategic responsibilities (2) BIM 20,590 2,455 - 23,045

(1) Held through Cofito S.p.A., the holding company of Banca Intermobiliare (2) Direct holding of full ownership (3) Held through companies subject to significant influence by executives with strategic responsibility

Related-party transactions: quantitative information

Related Party Assets Liabilities Expenses Income Guarantees Guarantees given received Holding company Cofito S.p.A 1,612 (42,127) (1,318) 30 - - Veneto Banca Holding 25,000 (4,935) (1,838) 1,697 Group companies (fully consolidated) Symphonia SGR S.p.A. 9,178 (23,322) (522) 25,658 - - Bim Fiduciaria S.p.A. 29 (464) (10) 46 - 60 Bim Immobiliare S.r.l. 42,563 (11) (2,128) 1,076 - - Bim Suisse S.A. 10,030 (28,298) (152) 180 - - Bim Insurance Brokers S.p.A. 3 (389) (4) 29 - - Banca Ipibi S.p.A. 46,616 (95,699) (2,492) 1,893 - - Immobiliare D S.r.l. 34,353 - - 548 - - Companies subject to significant influence Bim Vita S.p.A. 71 - - 192 - - Other related parties 319 (6,905) (464) 248 - 2,160

The assets of “related party” companies do not include the book value of the investee companies in the Parent NOTES TO THE FINANCIAL STATEMENTS - PART H Company’s financial statements. Assets and liabilities with other related parties are largely related to loans and to payables for cash deposits. Guarantees given and received, income and expenses are related to these same types of transactions. Client operations are focused on brokerage services in financial markets; loans are provided with the aim of facilitating these operations. Information required by Article 2497 of the Civil Code Banca Intermobiliare is subject to the “management and coordination” of Veneto Banca following the merger of Cofito (the controlling shareholder of Banca Intermobiliare), booked on 18 February 2010 and recorded in the Company Registers of Treviso and Turin on 25 February 2011. The required information, pursuant to Article 2497- bis of the Civil Code, was provided by furnishing the balance sheet and income statement taken from the latest approved financial statements of Veneto Banca Holding.

Notes to the Financial Statements - Part H • 353 FINANCIAL YEAR 2010

BALANCE SHEET (E)

Assets 31.12.2009 31.12.2008 20. Financial assets held for trading 278,751,387 354,238,453 30. Financial assets designated at fair value 2,513,837 - 40. Financial assets available for sale 493,689,221 450,838,801 60. Loans to banks 2,681,822,551 3,801,023,887 70. Loans to clients 3,760,274,493 2,019,849,093 80. Hedging derivatives 99,880,559 70,245,273 100. Equity Investments 2,854,845,444 2,759,306,091 110. Tangible fixed assets 33,914,493 35,744,329 120. Intangible fixed assets 657,718 952,111 Of which: - goodwill 130. Tax assets 37,246,007 36,479,183 a) current 20,742,587 9,901,938 b) prepaid 16,503,420 26,577,245 150. Other assets 151,719,560 130,802,743 Total assets 10,395,315,270 9.659.479.964

Liabilities and shareholders’ equity 31.12.2009 31.12.2008 10. Due to banks 3,906,941,226 2,472,441,171 20. Due to clients 21,000,399 70,242,190 30. Outstanding securities 3,508,696,482 4,264,622,234 40. Financial liabilities held for trading 231,025,669 316,542,139 50. Financial liabilities designated at fair value 20,235,465 100,141,043 60. Hedging derivatives 2,198,813 298,030 80. Tax liabilities 7,608,728 2,780,328 a) current 6,472,743 - b) deferred 1,135,985 2,780,328 100. Other liabilities 165,821,741 188,266,741 110. Employees’ severance fund 5,788,888 5,925,772 120. Provisions for risks and charges: 5,684,362 4,976,616 NOTES TO THE FINANCIAL STATEMENTS - PART H b) other provisions 5,684,362 4,976,616 130. Valuation reserves 11,052,117 4,241,006 150. Equity instruments 40,571 40,570 160. Reserves 289,663,463 313,835,882 170. Issue premiums 1,857,970,651 1,656,685,619 180. Share capital 254,371,317 236,610,873 200. Profit (loss) for the year 107,215,378 21,829,750 Total liabilities and shareholders’ equity 10,395,315,270 9.659.479.964

354 • Notes to the Financial Statements - Part H FINANCIAL YEAR 2010

INCOME STATEMENT (E)

Items 31.12.2009 31.12.2008 10. Interest income and similar items 176,602,059 190,280,315 20. Interest expense and similar charges (198,453,486) (245,479,450) 30. Interest margin (21,851,427) (55,199,135) 40. Fee and commission income 10,951,803 6,858,221 50. Fee and commission expenses (7,842,477) (5,845,848) 60. Net commissions 3,109,326 1,012,373 70. Dividends and similar income 80,491,767 67,099,953 80. Gains and losses on assets held for trading (12,192,464) (18,639,823) 90 Net profit on hedging operations 1,032,085 (3,526) 100. Profit (loss) on disposal or repurchase of: 25,972,195 2,676,143 a) loans (60,975) 15 b) financial assets available for sale 8,423,399 1,545,838 d) financial liabilities 17,609,771 1,130,290 110. Net profit on financial assets and liabilities designated at fair value (5,040,014) (129,182) 120. Intermediation margin 71,521,468 (3,183,197) 130. Net write-downs/write-backs for impairment of: (646,627) (7,576,559) b) financial assets available for sale (646,627) (7,576,559) 140. Net financial profit 70,874,841 (10,759,756) 150. Administrative expenses: (77,130,817) (65,367,420) a) personnel costs (53,181,467) (44,499,309) b) other administrative expenses (23,949,350) (20,868,111) 160. Net allocations to provisions for risks and charges (2,000,000) (87,288) 170. Net write-downs/write-backs of tangible fixed assets (3,410,861) (3,468,748) 180. Net write-downs/write-backs of intangible fixed assets (421,016) (891,549) 190. Other operating income/charges 37,794,365 40,079,861 200. Operating expenses (45,168,329) (29,735,144) 210. Profit (loss) on equity investments 76,112,011 52,584,360 240. Profit (loss) on disposal of investments - 17,067

250. Profit (Loss) on ordinary activities before taxes 101,818,523 12,106,527 NOTES TO THE FINANCIAL STATEMENTS - PART H 260. Income taxes for the year on ordinary activities 5,396,855 9,723,223 270. Profit (Loss) on ordinary activities after taxes 107,215,378 21,829,750 290. Profit (loss) for the year 107,215,378 21,829,750

Notes to the Financial Statements - Part H • 355 FINANCIAL YEAR 2010 Part I - SHARE-BASED PAYMENT AGREEMENTS

QUALITATIVE INFORMATION

1. Description of share-based payment agreements

As at 31 December 2010, there were no longer any stock option plans of Banca Intermobiliare, but only stock granting plans which offer all employees the option to purchase Bim shares at nominal value with a three-year non- transfer restriction. Banca Intermobiliare had previously provided staff incentives in the form of compensation plans based on the allocation of ordinary shares of Banca Intermobiliare in the form of stock options (free allocation of options incorporating the right to purchase Bim shares at a specific price and within a pre-established time frame).

QUANTITATIVE INFORMATION

1. Annual changes

The table indicates stock option allocation figures using the format dictated by Appendix 3C of the Consob Issuers Regulation. This format also includes the information required by the Bank of Italy in Circular No. 262/2005.

Items/Number of 2010 2009 options and exercise prices Number of Average Average Number of Average Average options exercise prices maturity options exercise prices maturity A. Opening balance - - - 809,486 6.26 2009 B. Increases B.1 New issues 171,855 3.36 x 264,470 3.36 x B.2 Other changes - - x - - x C. Decreases C.1 Eliminations - - x - - x C.2 Options exercised (171,855) 2.36 x (264,470) 2.36 x C.3 Options expired - - x (809,486) (6.26) x C.4 Other changes - - x - - x D. Net closing balance ------NOTES TO THE FINANCIAL STATEMENTS - PART I NOTES TO THE FINANCIAL STATEMENTS - PART F E. Exercisable options at the end of the year - - x - - x

2. Additional information

Expenses charged to the income statement in relation to share-based payment agreements for the 2010 financial statements of Banca Intermobiliare totalled EUR 542,000 and were related to stock granting.

356 • Notes to the Financial Statements - Part I FINANCIAL YEAR 2010 Part L - OPERATING SEGMENT

This section describes the results of Banca Intermobiliare reported by the operating segments into which the bank’s business is divided. Segments were identified in accordance with IFRS 8, which was used starting with the Half-Yearly Consolidated Financial Statements as at 30 June 2009 to replace the previous provisions on segment reporting in IAS 14. In short, the new principle specifies that the information presented must be structured in accordance with the reporting system used by management to analyse operating performance. Based on this new principle, Banca Intermobiliare has identified the following operating segments:Client, Finance and Corporate Centre. The Client Segment covers all typical transactions of private banking such as securities brokerage, asset management (in the form of individual and collective asset management portfolios) and ancillary activities such as lending and financial advisory services. The Finance Segment incorporates all trading operations carried out on the bank’s portfolio, the management of the treasury’s interbank operations and the management of rate and liquidity risk carried out by the Parent Company. The Corporate Centre consists of the General Management of Banca Intermobiliare and the corporate bodies, in addition to activities that support the operations of governance bodies and not the two specific businesses. This area also retains responsibility for the management of strategic equity investments and for the imputed interest associated with the notional treasury unit.

Breakdown by business segment: Operating figures for Banca Intermobiliare

At the Parent Company level, in 2010 the contribution of the bank’s various segments to operating results of the Client Segment differed as noted below. To summarise: • The Client Segment reported 56% growth y/y in interest margin due to the combined impact of growth in client loans and rates and the new method for calculating the transfer rate for in-house bond issues (which assigns a positive margin to the distribution channel). Net commissions were in line with 2009 as the combined result of a reduction in performance commissions and an increase in management fees. Overall, the earning margin rose by 19% (about EUR 11.5 million). Operating expenses for the segment were in line with the previous year. In 2010, loan adjustments were about EUR 4.2 million compared to EUR 18 million, leading to earnings before tax of EUR 21.9 million compared to EUR -3.8 million in the previous year. • In 2010, the Finance Segment reported profits in line with 2009. The reduction in net interest was more than offset by growth in net profit on instruments held for trading. The earning margin rose by 3.5% y/y, and the

division’s costs were up by 8%. NOTES TO THE FINANCIAL STATEMENTS - PART L • The Corporate Centre reported a negative earnings margin due to the new method for calculating the transfer rate for in-house bond issues (which assigns a positive margin to the distribution channel and penalises the notional treasury’s margin at the Corporate Centre) and because of the variation in the responsibility perimeter for the AFS portfolio (in 2010 this was under the exclusive responsibility of the Finance Segment). Operating costs were up by 12%. In 2010 there were small net allocations to the provision for risks and charges: EUR 2.5 million compared to EUR 10 million in the previous year.

Notes to the Financial Statements - Part L • 357 FINANCIAL YEAR 2010

OPERATING FIGURES BY BUSINESS SEGMENT (Thousands of€) BANCA INTERMOBILIARE Client Segment Finance Segment Corporate Centre Total 2010 2009 2010 2009 2010 2009 2010 2009

Net interest 34,063 21,811 7,642 12,126 -14,388 -8,017 27,318 25,920 Net commissions 39,087 38,468 -468 -179 9 -456 38,628 37,833 Fee and commission income 61,026 58,565 0 0 756 447 -23,154 59,012 Fee and commission expenses -21,939 -20,096 -468 -179 -747 -903 38,628 -21,178 Dividends and similar income 0 0 2,929 190 6,816 1,090 9,745 1,280 Net profit on instruments held for trading -633 718 14,863 12,206 0 0 14,230 12,924 Net profit on hedging instruments 0 0 0 553 0 0 0 553 Profit (loss) on disposal or repurchase -370 -340 7,396 6,369 0 7,416 7,026 13,445 Intermediation margin 72,148 60,657 32,361 31,265 -7,563 33 96,946 91,955 Gross operating expenses -46,039 -46,368 -5,042 -4,654 -20,223 -18,152 -71,304 -69,174 Other operating income/ charges 0 0 0 0 1,020 1,022 1,020 1,022 Net operating expenses -46,039 -46,368 -5,042 -4,654 -19,204 -17,130 -70,284 -68,152 Operating income 26,109 14,290 27,319 26,610 -26,767 -17,097 26,662 23,803 Net write-downs on loans -4,218 -18,106 0 0 0 0 -4,218 -18,106 Net allocations to provisions for risks and charges 0 0 0 0 -2,545 -10,640 -2,545 -10,640 Profit of equity investments accounted for using equity method 0 0 0 0 298 0 298 0 Profit before non-recurring items 21,891 -3,816 27,319 26,610 -29,014 -27,737 20,197 -4,942 Profit (loss) on disposal and value adjustments of financial instruments 0 0 -1,050 -51 0 5,755 -1,050 5,704 Value adjustments for impairment of equity investments 0 0 0 0 996 -59 996 -59 Earnings before tax 21,891 -3,816 26,269 26,560 -28,018 -22,040 20,143 704 NOTA INTEGRATIVA INDIVIDUALE - PARTE L

NOTES TO THE FINANCIAL STATEMENTS - PART L NOTES TO THE FINANCIAL STATEMENTS - PART F Breakdown by business segment: Balance sheet figures for Banca Intermobiliare

In 2010 the Client Segment reported loan growth of over EUR 140 million (+8%) and a reduction in deposits of about EUR 350 million. The Finance Segment reported a net negative financial position of EUR 325 million, which was down by EUR 85 million compared to 2009, and a reduction in financial assets (net of liabilities) of about EUR 140 million. The Corporate Centre was in line with the previous year except for the change in responsibility for AFS securities as described above.

358 • Notes to the Financial Statements - Part L FINANCIAL YEAR 2010

BALANCE SHEET FIGURES BY BUSINESS SEGMENT (Thousands of €)

Banca Intermobiliare FOR THIRD PARTIES FOR BANK CORPORATE CENTRE Total 2010 2009 2010 2009 2010 2009 2010 2009

Cash on hand - - 3,320 3,523 - - 3,320 3,523 Loans to clients 1,898,034 1,754,362 5,494 10,249 - - 1,903,527 1,764,611 Loans to banks - - 234,799 288,020 - - 234,799 288,020 Financial assets held for trading - - 398,177 516,194 - - 398,177 516,194 Available-for-sale assets - - 348,002 304,538 - 43,550 348,002 348,088 Financial assets held to maturity - - 5,627 5,551 - - 5,627 5,551 Equity Investments - - - - 148,591 148,186 148,591 148,186 Investments - - - - 9,126 9,640 9,126 9,640 Other assets - - - - 68,220 73,409 68,220 73,409 BALANCE SHEET ASSETS 1,898,034 1,754,362 995,419 1,128,074 225,937 274,785 3,119,390 3,157,221 Due to banks - - 560,571 529,031 - - 560,571 529,031 Due to clients 1,409,837 1,758,400 163,062 2,435 0,00 - 1,572,899 1,760,835 Outstanding securities 421,566 367,642 - - - - 421,566 367,642 Financial liabilities held for trading 635 384 148,714 85,615 - - 149,349 86,000 Liabilities associated with disposal groups held for sale Hedging derivatives ------Provisions and other liabilities - - - - 61,139 67,842 61,139 67,842 Shareholders' Equity - - - - 353,866 345,872 353,866 345,872 BALANCE SHEET LIABILITIES AND SHAREHOLDERS' EQUITY 1,832,037 2,126,426 872,347 617,081 415,006 413,714 3,119,390 3,157,221 NOTES TO THE FINANCIAL STATEMENTS - PART L

Notes to the Financial Statements - Part L • 359

FINANCIAL YEAR 2010

SEPARATE FINANCIAL STATEMENTS AT 31 DECEMBER 2010 CERTIFICATION OF THE SEPARATE FINANCIAL STATEMENTS, PURSUANT TO ARTICLE 81 - TER OF CONSOB REGULATION NO. 11971 OF 14 MAY 1999 AS AMENDED AND SUPPLEMENTED

FINANCIAL YEAR 2010 FINANCIAL YEAR 2010

Certification of the separate financial statements, in accordance with Article 81 -ter of the Consob reg ulations no. 11971 of 14 May 1999 as amended and supplemented

1. The undersigned parties, Pietro D’Aguì, acting in the capacity of Chief Executive Officer, and Mauro Valesani, acting in the capacity of the Executive in charge of company accounting documents of Banca Intermobiliare di Investimenti e Gestioni S.p.A., hereby certify, taking into account the provisions of Article 154 bis, paragraphs 3 and 4, of Legislative Decree no. 58 of 24 February 1998: • the adequacy – in relation to company characteristics – and • the effective application of administrative and accounting procedures for the preparation of the separate financial statements during the course of the financial year 2010.

2. It is also hereby certified that the separate financial statements, at 31 De cember 2010: • are consistent with the accounting books and entries; • are drafted in accordance with IAS/IFRS accounting principles issued by IASB, in accordance with Legislative Decree no. 38 of 28 February 2008, as well as in compliance with Memorandum no. 262 of 22 December 2005, and its subsequent amendments, issued by Bank of Italy and Consob provisions for listed issuers; • provide a truthful and accurate representation of the economic and financial situation of the issuer.

3. The report on operations includ es a reliable analysis of operational trends and results as well as on the situation of the issuer in addition to a description of the primary risks and uncertainties to which they are exposed.

Turin, 14 March 2011

Chief Executive Officer Executive in c harge of company accounting documents

Pietro D’Aguì Mauro Valesani

CERTIFICATION OF THE SEPARATE FINANCIAL STATEMENTS

350 362 • Certifications of the Separate Financial Statements

FINANCIAL YEAR 2010

SEPARATE FINANCIAL STATEMENTS AS OF 31 DECEMBER 2010

INDEPENDENT AUDITORS’ REPORT ON THE SEPARATE FINANCIAL STATEMENTS INDEPENDENT AUDITORS’ REPORT 364 •Independent Auditor’s Report Independent Auditor’s Report•365

INDEPENDENT AUDITORS’ REPORT

FINANCIAL YEAR 2010

SEPARATE FINANCIAL STATEMENTS AT 31 DECEMBER 2010

ANNEXES TO THE SEPARATE FINANCIAL STATEMENTS FINANCIAL YEAR 2010 Annex 2 - Independent auditors’ fees related to the separate financial statements

DISCLOSURE OF FEES PAID FOR AUDITING SERVICES AND FOR SERVICES OTHER THAN THE AUDITING OF THE SEPARATE FINANCIAL STATEMENTS

1. Information disclosure obligation

Article 2427, paragraph 16 bis, and Article 149 duodecies of the CONSOB Issuers Regulations no. 11971 have introduced specific requirements in relation to the disclosure of auditing fees.

2. Quantitative information

Type of services Entity supplying Recipient Fees (€/thousand) the service Audit Deloitte & Touche S.p.A Banca Intermobiliare 110 Other services - Signing of tax returns Deloitte & Touche S.p.A Banca Intermobiliare 10 - Agreed auditing procedures Deloitte & Touche S.p.A Banca Intermobiliare 2 Total 122 ANNEX 2 TO THE SEPARATE FINANCIAL STATEMENTS

368 • Annex 2 GROUP Direzione Generale - Via Gramsci, 7 - 10121 Torino Tel. 011/0828.1 - Fax 011/08.28.800