MARCH 31, 2006 - QUARTERLY REPORT

MANAGEMENT BODIES OF THE BANK

Members of the Board of Directors

DINO PIERO MARIO GIARDA CHAIRMAN

DIVO GRONCHI CHIEF EXECUTIVE OFFICER

ENRICO PEROTTI SENIOR DEPUTY CHAIRMAN

VITTORIO CODA DEPUTY CHAIRMAN

GUIDO CASTELLOTTI DIRECTOR PIERANTONIO CIAMPICALI DIRECTOR COSTANTINO COCCOLI DIRECTOR MARIA LUISA DI BATTISTA DIRECTOR BRUNO GIOVANNI GIUFFRÈ DIRECTOR ANDREA GUIDI DIRECTOR AUGUSTO MACHIRELLI DIRECTOR PIETRO MANZONETTO DIRECTOR ROBERTO NICOLA ALBINO MARTONE DIRECTOR MARIO MINOJA DIRECTOR GIORGIO OLMO DIRECTOR ROBERTO SCHMID DIRECTOR

Members of the Board of Statutory Auditors

GIANANDREA GOISIS CHAIRMAN

LUIGI CORSI STATUTORY AUDITOR GABRIELE CAMILLO ERBA STATUTORY AUDITOR GIORDANO MASSA STATUTORY AUDITOR PIETRO MAZZOLA STATUTORY AUDITOR

GIANPAOLO FORNASARI ALTERNATE AUDITOR MASSIMO MUSTARELLI ALTERNATE AUDITOR

General Management

FRANCO BARONIO GENERAL MANAGER

3 BANCA POPOLARE ITALIANA Soc. Coop.

70,86% put 2,65% + 0,81%

Reti Bancarie S.p.A.

100,00% Banca Popolare di Crema 94,47% 51,00% Bipielle ICT S.p.A. S.p.A. Banca Caripe S.p.A. put 44,00%

100,00% Banca Popolare di Lodi 0,04% Banca Popolare di 99,43% 52,32% Banca Popolare di Capital Company L.L.C. Cremona S.p.A. Mantova S.p.A.

100,00% Banca Popolare di Lodi 20,93% Cassa di Risparmio di 46,28% 61,25% Banca Valori S.p.A. Capital Company L.L.C. II put Lucca S.p.A. 12,39% 100,00%

100,00% Banca Popolare di Lodi 100,00% Cassa di Risparmi di Nazionale Fiduciaria Capital Company L.L.C. III Livorno S.p.A. S.p.A.

100,00% 70,12% Bipielle 100,00% Critefi SIM S.p.A. Riscossioni S.p.A. Castimm S.r.l.

60,00% 100,00% 34,00% Bipielle International Tiepolo Finance S.r.l. Assipromos S.r.l. Holding S.A.

4,00% 20,00% 30,00% Unione 86,00% Fiduciaria S.p.A. Bipielle Bank Bipielle Società di Gestione 70,00% (Suisse) S.A. del Credito S.p.A.

5,31% 60,00% 72,00% Bipielle International 10,28% UK Ltd Arca SGR S.p.A. Tiepolo Finance II S.r.l. 100,00% 5,12% Area Life International Assurance Ltd 4,85%

5,00% 2,50% Cassa di Risparmio di Centrosim S.p.A. 100,00% 5,00% Pisa S.p.A.

5,00% 19,99% C.R. Bolzano S.p.A.

40,00% Cartesio Alternative Investments S.G.R. S.p.A

95,00% Bipitalia Broker S.r.l.

LEGENDA Parent Bank and subholding companies Fully consolidated companies Companies carried at equity Companies valued at cost Gruppo Banca Popolare Italiana as at 31 march 2006

87,45% put 4,49% 7,32% Bipielle Investimenti S.p.A. Gruppo Partecipazioni italiane S.p.A. 82,67%

100,00% 99,61% Bipitalia Ducato S.p.A. Efibanca S.p.A.

28,35% 50,00% Efibanca Palladio Bipitalia Gestioni SGR 96,96% Ali S.p.A. S.p.A. Finanziaria SGR S.p.A.

80,00% 29,57% 21,21% Gruppo Palladio Comital Saiag S.p.A. put Finanziaria Bipielle Alternative SGR 20,00% 21,21% S.p.A. 38,71% 5,00% Deroma S.p.A. Glass Italy BV Bipielle Fondi Immobiliari 100,00% SGR S.p.A. 20,00% 100,00% Acque Minerali Riunite Fidia Farmaceutici S.p.A. S.p.A. Italfortune International 90,00% Advisor S.p.A. 20,00% IGLI S.p.A. Banca Bipielle Network 98,86% S.p.A. 51,00% AB Capital S.p.A.

100,00% 21,51% Bipielle Previdenza Assicurativa S.r.l. Tortella S.p.A.

1,00% 99,00% 100,00% Bipielle Real Estate Royle West Ltd S.p.A.

100,00% Bipielle Immobili 99,74% Bipielle Leasing S.p.A. Strumentali S.p.A.

100,00% Basileus S.p.A. 50,00% Finoa S.r.l.

100,00% 100,00% Lido dei Coralli S.r.l. Perseo Immobiliare S.r.l.

100,00% Aviva Previdenza S.p.A. 100,00% 100,00% Antares Immobiliare S.r.l. Nadir Immobiliare S.r.l.

80,96% Eurovita Assicurazioni 100,00% 100,00% S.p.A. B.S.R. G.T.I. S.r.l. Azimuth Immobiliare S.r.l.

Andromeda Immobiliare 100,00% 100,00% Antilia Immobiliare S.r.l. S.r.l. 50,00% Buon Viaggio S.p.A. 20,00% 75,00% Bussentina Soc. coop. Framo Soc. coop.

Solidarietà & Finanza SIM 20,00% 100,00% 30,00% S.p.A. Sirio immobiliare S.r.l. Portone Soc. coop.

100,00% Carfid S.r.l. 100,00% Lisbona Immobiliare S.r.l.

50,00%

100,00% 50,00% Pegaso Immobiliare S.r.l. Hotel Project Lisboa Lda

GROUP FINANCIAL HIGHLIGHTS % chng % chng Amounts in Euro/000 31/03/2006 31/12/2005 31/03/2005 31/12/2005 31/03/2005 Consolidated balance sheet Total assets 46,266,571 47,322,515 -2.23% Total loans 31,189,658 32,425,959 -3.81% of which: - customer loans 27,397,690 27,968,762 -2.04% Financial assets 5,955,447 5,964,761 -0.16% Shareholdings 482,635 487,644 -1.03% Total payables 39,002,685 39,428,822 -1.08% of which: - due to customers and securities in issue 34,587,590 34,637,203 -0.14% Indirect deposits 38,359,351 36,869,892 4.04% of which: - managed 22,857,181 21,092,304 8.37% Net interbank position 515,374 (334,422) n/a Group shareholders' equity and minority 3,293,274 3,247,975 1.39% interests (including profit/loss) of which: - Group shareholders' equity (including 2,854,804 2,786,311 2.46% Group profit/loss) Consolidated income statement Net interest 182,364 216,296 -15.69% Net commissions 102,217 101,515 0.69% Net income from trading activities 42,726 52,124 -18.03% Net operating income 382,891 406,545 -5.82% Operating expenses (274,240) (315,309) -13.02% Income from operating activities 109,155 90,846 20.15% Net adjustments to loans (37,313) (34,203) 9.09% Net income 51,700 30,198 71.20% Operating structure Number of employees 8,504 8,598 8,654 Number of financial advisors 989 1,045 Number of branches 979 979 976 Ratios ROE 7.38% -21.07% 6.95% ROA 0.45% -1.57% 0.41% Net interest income/Total income including 28.52% 23.71% 27.37% financial and insurance operations Administrative expenses/Total income 61.43% 79.52% 60.50% including financial and insurance operations Gross financial assets/Total assets 12.87% 12.60% Net NPL / Customer loans 3.21% 1.08% Net adjustments for impairment of loans / Net 0.14% 2.69% loans

6 SCENARIO IN THE FIRST QUARTER OF 2006 The global economic picture at the start of 2006 is showing signs of increased growth, spearheaded by the major emerging markets, whose impressive flow of supply is helping to mitigate the inflationary pressures caused by raw materials subject to constant price fluctuation. Confirmation that the US economy is going in the right direction comes from the figure for Gross Domestic Product which, in the first quarter of 2006, grew at a rate of 4.8%. This figure represents the expected bounce-back from the modest +1.7% recorded in the final period of 2005. Japan also hit the headlines in the quarter, with the decision of the Bank of Japan to end five years of monetary policy in which official interest rates were held at zero as a way of providing a significant quantitative boost to the economy. In the Eurozone, the various economic indicators are pointing towards improvement: growth forecasts (closer to 2% in the quarter), surveys among traders and unemployment. Based on these circumstances, at the start of March, the European Central Bank increased the key interest rate again to 2.50%. Growth has come later in Italy where inflationary tensions (2.2% in March) remain in line with the European average. The primary challenge in the short term is the management of public accounts, estimated to have a deficit of 4.1% in the current year, showing no improvement on 2005. As regards the financial industry, the system of mutual funds ended the quarter with strong deposits (+€4.4 billion) while deposits are starting to pick up for all banks after a seasonal lull at the start of the year. Lending remains buoyant in the households’ component but moderate for companies.

EVENTS DURING THE QUARTER In the first quarter of 2006, the foundations were laid for overcoming the difficulties that the Gruppo BPI experienced in 2005. A summary of the main events that occurred up to March 31, 2006 is given below.

Corporate Governance actions and management change On January 28, 2006, during the Shareholders' Meeting called for the replacement of the outgoing Board of Directors, the number of members of the Board of Directors was determined to be 16 and the following were elected as Directors: Guido Duccio Castellotti, Pier Antonio Ciampicali, Costantino Coccoli, Vittorio Coda, Maria Luisa Di Battista, Dino Piero Giarda, Bruno Giuffrè, Divo Gronchi, Andrea Guidi, Augusto Machirelli, Pietro Manzonetto, Roberto Nicola Martone, Mario Minoja, Giorgio Olmo, Enrico Perotti and Roberto Schmid. Furthermore, the Shareholders also added to the Board of Statutory Auditors by electing the following as Statutory Auditors: Gabriele Camillo Erba, Luigi Corsi and Giordano Massa; and the following as Alternate Auditors: Gianpaolo Fornasari and Massimo Mustarelli. The Shareholders' Meeting also re-approved the Financial Statements for the year ended December 31, 2004, amending the approval resolution previously made by the Board on April 30, 2005. This was necessary following the comments made by CONSOB and led to negative adjustments totalling €195 million in the income statement, thus making the Parent Bank's loss for the year €23.3 million. In its meeting on January 30, 2006, the Board of Directors appointed a Chairman, Dino Piero Giarda, lecturer at Milan Catholic University, former Treasury Under Secretary from 1995 to 2001 and current Chairman of the sub-holding Bipielle Investimenti, and appointed Divo Gronchi as Chief Executive Officer. After the initial - more urgent - appointments, which were decided in 2005, the Parent Bank's management structure was progressively redesigned over the subsequent months with the recruitment of other managers from outside. Other appointments included the Deputy General Manager Giuseppe Malerbi, with powers in the Credit and Finance area, and the Deputy General Manager Apicella Guerra, with powers in the Operation area (organisation and IT). The Board of Directors' appointment of the General Manager, Franco Baronio, former Deputy Chairman of the consultancy firm Bain & Company, with significant experience in banking consultancy, completed the picture. The respective responsibilities were assigned: the Chief Executive Officer is responsible for strategy and control and the General Manager is responsible for the "operating machine" and all other duties. Finally, on March 9, 2006, the Board of Directors appointed Enrico Perotti and Vittorio Coda as Senior Deputy Chairman and Deputy Chairman respectively of the Parent Bank's Board of Directors.

The sale of Bipielle Leasing On February 23, 2006, the contract was signed to sell the shareholding held in Bipielle Leasing, equal to 99.74% of the capital, to Banca Italease. The sale is expected to be made at a price of €51 million, almost 1.5 times the shareholders' equity in December 2005, thereby generating a gain of around €24.5 million. The sale of the investment, which was authorised by the Supervisory Authority on April 28, 2006, should take place

7 within the first half of 2006. For the Gruppo Banca Popolare Italiana, the sale of Bipielle Leasing is, on the one hand, part of the process of streamlining the investments held by the Gruppo Banca Popolare Italiana and focussing on those with greater strategic importance, and, on the other hand, is a key part of commercial consolidation, thanks to the agreement with the Banca Italease Group, whose level of efficiency and technical expertise make it one of the leading companies in Italy in the leasing sector. At the same time, Banca Italease signed a three-year operational agreement with Banca Popolare Italiana and Reti Bancarie S.p.A, starting from the date on which the acquisition is completed, involving the introduction (via the respective distribution networks) of finance leasing opportunities to the Banca Italease Group on an exclusive basis nationwide. Banca Popolare Italiana, Bipielle Investimenti and Banca Italease received financial advice from Mediobanca S.p.A. and Rothschild respectively and legal advice from the Clifford Chance Law Firm and the Pavesi Gitti Verzoni Law Firm respectively.

The agreement with Fondazione Cassa di Risparmio di Lucca On March 9, 2006, the Parent Bank's Board of Directors approved, within its powers, the resolutions taken by the Boards of Directors of Casse di Risparmio di Lucca, Pisa and Livorno in relation to the merger by absorption of Cassa di Risparmio di Pisa and Cassa di Risparmi di Livorno into Cassa di Risparmio di Lucca. The initiative is part of the business and strategic plan drawn up by Banca Popolare Italiana and by Fondazione Cassa di Risparmio di Lucca, with the aim of creating a regional banking group that is able to compete on its territory with the main active competitors. The merger operation, which was authorised by the Supervisory Authorities on April 24, 2006, follows the sale by the Parent Bank to Cassa di Risparmio di Lucca of the 26 branches that belonged to BPI's regional network (sale which took place on January 2, 2006). The sale of these branches generated for the Parent Bank a gain of €20.7 million, net of taxes, which was totalled eliminated at consolidated level. This new "Polo Toscano" will take the name Cassa di Risparmio di Lucca Pisa Livorno S.p.A. The agreement between the parties includes a commitment by Fondazione Cassa di Risparmio di Lucca to invest €135 million in the project, which - together with the €190 million investment already made - makes a grand total of €325 million. The proposed plan is subject to the usual authorisations being obtained and, as well as having a business and strategic impact, it has a strong income potential because of the synergies that will arise from greater visibility and better positioning of the distribution network, in addition to the investments that will be made in the region. Fondazione Cassa di Risparmio di Pisa extended the exercising of the €109 million put option until June 2008. As regards the technical aspects of the merger, which must take place by June 30, 2006, because the current shareholding structure of the companies participating in the merger involves the total control of Cassa di Risparmio di Pisa and Cassa di Risparmi di Livorno by Cassa di Risparmio di Lucca, Art. 2505 of the Civil Code, regarding the simplified merger procedure, is applicable. The merger is therefore to be carried out without any exchange of shares or changes in the share capital of the absorbing company.

Enforcement of the pledge given by Magiste International S.A. and Garlsson on RCS Mediagroup shares On March 23, 2006, the Board of Directors of Banca Popolare Italiana decided to enforce the pledge given by Magiste International S.A. and Garlsson on all of the 103,548,754 RCS Mediagroup shares. To this end, it authorised the Chief Executive Officer to sell the above shares pursuant to Art. 4, lett. a) of Legislative Decree. no. 170/2004 and also granted him every power to execute the sale including the power to identify procedures for guaranteeing the transparency and reasonableness thereof. The Board of Directors also resolved that Banca Popolare Italiana can itself buy the aforementioned RCS shares, where necessary to ensure that the terms of realisation and valuation are commercially reasonable, as specified in Art. 8 of Legislative Decree no. 170/2004.

Capital strengthening approved by Board of Directors On March 27, 2006, the Board of Directors of Banca Popolare Italiana decided to submit for the approval of the Extraordinary Shareholders' Meeting the proposal to grant the Board of Directors the right, pursuant to Art. 2443 of the Civil Code, to increase the share capital within one year of the date of the resolution by a maximum amount - including premium - of €800 million. The purpose of the capital increase is to allow, through capital strengthening, for the achievement of the growth targets and business development objectives set out in the Group's 2006-2009 Business Plan, as described below. As specified below, the Extraordinary Shareholders' Meeting of April 29, 2006 approved the operation.

8 EVENTS AFTER MARCH 31, 2006 AND BUSINESS OUTLOOK Shortening of the corporate chain On April 3, 2006, the Board of Directors of Banca Popolare Italiana decided to shorten the corporate structure and identified the merger of Reti Bancarie S.p.A. and Bipielle Investimenti S.p.A. into Banca Popolare Italiana Soc. Coop. as being its preferred method. It also decided that the share exchange ratio would be determined by the Board of Directors which would resolve on the proposed merger and call extraordinary meetings, possibly by July 2006. The Board of Directors also decided, with regard to determining the share exchange ratio, to appoint Mediobanca as advisor to Banca Popolare Italiana and Credit Suisse as advisor to Bipielle Investimenti and Reti Bancarie. The planned merger is justified from an economic, strategic and corporate point of view by the series of measures that the Group's Business Plan, as described below, must implement. The planned merger enables the shareholders of the companies to be merged (a) to become direct shareholders in the Parent Bank, enjoying the benefits arising from the simplification of the corporate chain; (b) to participate in the increased profitability generated by the implementation of the Business Plan, particularly in terms of better integration between product companies and distribution networks; (c) to possess a more liquid share than that which they currently possess (which is that of a subsidiary managed and coordinated by the absorbing company), potentially benefiting from a higher value. From this perspective, without prejudice to the foregoing, the implementation of the Business Plan through the planned merger described above seems likely to also have effects in terms of: • promoting the development of the Group's core business; • promoting integration between the activities currently performed by Reti Bancarie and by its subsidiaries with the activities performed by the product companies currently controlled by Bipielle Investimenti S.p.A.; • increasing competition on the market thanks to the benefits arising from more efficient coordination of commercial policies and better customer service, achieving operational synergies through initiatives aimed at maximising efficiency and centralising services, units and structures.

The 2006-2009 Business Plan and the international roadshow In its meeting of April 3, 2006, the Board of Directors of Banca Popolare Italiana approved the 2006-2009 Business Plan. On the following day, the Plan was presented to the financial community. The 2006-2009 Business Plan, prepared with the help of Bain & Co. and Mediobanca, aims to fully achieve the hitherto unreached potential of the Gruppo Banca Popolare Italiana by focussing on the bank's core business. The Group's strategy focuses on profitability, asset quality, strength and creation of value. These objectives are pursued through four key actions on which the Business Plan is founded: 1) company reorganisation and industrial refocusing; 2) development of the core business - the "Banca delle Piazze" (Bank in the Square); 3) development and commercial integration of the product companies; 4) optimisation of funding cost.

Company reorganisation and industrial refocusing will be pursued along three lines of action: 1) shortening of the corporate structure. As previously stated, on April 3, 2006, the Board of Directors of Banca Popolare Italiana identified the merger of Reti Bancarie S.p.A. and Bipielle Investimenti S.p.A. into Banca Popolare Italiana as being its preferred method and it also decided that the share exchange ratio would be determined by the Board of Directors, which would resolve on the proposed merger and call extraordinary meetings, possibly by July 2006; 2) streamlining of the proprietary financial portfolio by selling off the main assets that do not conform to the new risk policy, closing numerous derivatives positions and decreasing investments in equities. The target for 2009 is to reduce the portfolio of financial assets held for trading from €4.2 billion to €3.0 billion, of which 80% will be bonds and the remainder equities. 3) selling-off of non-strategic assets totalling €1.5 billion, of which: non-strategic shareholdings worth around €1 billion which will be progressively sold off; non-commercial properties worth around €300 million which can be sold off over the timeframe of the Business Plan; assignment of non-performing loans worth around €200 million (gross value €950 million).

9 At the centre of the development of the core business is the "Banca delle Piazze" project. To recover profitability in the core business, the Business Plan contains a series of initiatives aimed at developing the new "Banca delle Piazze" concept, which will seek to promote the Gruppo BPI in terms of its key values of regional presence, competitive cost position and appropriate size so that it can effectively control the markets in which it is present.

The "Banca delle Piazze" project is based on three key elements:

i) New network model: the strengthening of commercial presence will be achieved by expanding the sales force (450 sales personnel) and by setting up different organisational modules according to the size of the subsidiaries and by recruiting specialist professionals reporting to the district manager. The development of the current distribution network will involve over the three-year period transferring and moving 50-60 branches away from underdeveloped and unattractive areas to attractive regional areas and simultaneously supporting high potential areas on the basis of the focussed regional development and concentration model. ii) Value proposition - A review of the product range is another key element in the process aimed at improving the competitiveness of the network. Extremely competitive products will be introduced which have been analysed and designed to meet the needs of households and small and medium-sized companies, which represent the Group's target. A prime example is the 30-year dynamic mortgage, currently one of the best value mortgages on the market offering a loan repayable over 30 years at an extremely competitive rate: 3-month EURIBOR + 0.95%. Mortgage options will include a rate cap (mechanism which keeps any rate increases below a given ceiling) and full insurance cover (Building, Death, Loss of Employment). In addition, there are no early repayment penalties. iii) Local marketing - The local focus will also be reflected in the marketing and communication policies of the Business Plan. The aim is to achieve the maximum degree of identification of the Gruppo BPI in the areas in which is it present, using the current brands.

Development and commercial integration of the product companies of the Gruppo Banca Popolare Italiana is another key feature of the Business Plan. The two main product companies, Bipitalia Ducato, the consumer credit leader, and Efibanca, the Group's merchant bank, are vitally important from an economic and strategic perspective. We will seek to develop Bipitalia Ducato's activities by focussing on product innovation and process innovation in the areas offering greatest potential, such as Revolving Cards and Fifth of Salary Loans. The distribution strategy will be boosted by developing synergies with the Group's network banks, by developing the extracaptive commercial networks for targeted credit, fifth of salary loans and subprime loans and by identifying agency networks that are potential acquisition targets. Efibanca offers a strong competitive benefit to the Group in terms of strengthening the value proposition. Efibanca's growth will based on risk control, on greater integration with the Group's commercial banks and on the relaunch of advisory and private equity activities.

The final one of the Plan's key actions is the reduction and optimisation of the funding cost, necessary for rebalancing net interest income to achieve the targets set by the plan. The lines of action to be followed will be: to obtain new funding from customers, principally focussing on sight deposits, through high return products and to reduce exposure to institutional investors. The forecasts about the balance sheet and income statement aggregates connected to the implementation of the Business Plan will bring the Gruppo Banca Popolare Italiana up to adequate levels of financial strength and profitability, backed up by a clear and efficient industrial and commercial structure. The trends in the balance sheet aggregates under the Business Plan firstly indicate an average increase in direct deposits of 4.5% and an increase in lending of 9.9%. Indirect deposits should rise by 6.9% boosted by the expected 7.0% increase in managed assets. The expected effects of these policies, together with a significant increase in low capital absorption activities and with constant attention placed on costs and efficiency, should produce a consolidated ROE of around 13% in 2009, in the event of the total withdrawal of the shareholders of Bipielle Investimenti and Reti Bancarie, and of around 11% in the event of no withdrawal, including taking into account the investments aimed at supporting internal rationalisation and process functionality.

10 Immediately after the Business Plan was presented to analysts, an international roadshow was held from 5 to 12 April with stops in London, New York and Boston. Generally speaking, there was a very high level of interest in the Gruppo Banca Popolare Italiana. Investors in particular were favourable to the plan, which most considered to be ambitious but also reasonable and credible, with a clear strategy and precise objectives that were deemed achievable. The Chief Executive Officer, the General Manager and Investor Relations met more than 60 investors, and the opinion was very positive. The Group is seen from the outside as a story of reorganisation and turnaround and a fascinating industrial and management challenge, with excellent income-generating potential. The change of management and the appointment of a new Chairman and a re-elected Board of Directors are considered the ideal foundations for the relaunch of the Bank and for its credibility.

Capital increase approved by the Extraordinary Meeting The Shareholders' Meeting of Banca Popolare Italiana, meeting in ordinary session to approve the Financial Statements for the year ended December 31, 2005, decided, in extraordinary session, to: • cancel the decisions corresponding to items 3 and 4 on the agenda of the Extraordinary Meeting of June 2, 2005; • cancel, for the part not yet implemented, the decision corresponding to item 4 on the agenda of the Extraordinary Meeting of March 3, 2003. The Shareholders also decided to grant the Board of Directors, pursuant to Art. 2443 of the Civil Code, the right to increase the share capital, on one or more occasions, within one year of the respective resolution, by a maximum amount of €800 million, by giving the persons entitled an option on newly-issued shares, according to the terms and conditions that the Directors will establish from time to time, including the issue price (including any premium).

Business outlook The first quarter of 2006 witnessed significant signs of recovery in overall profitability, as described below. In particular, the banks recorded a downward trend in ordinary management components, still feeling the effects of the decline in business that characterised 2005. Conversely, the product companies improved their growth rates. Cost control efficiency, which is expected to continue during the second part of the year, together with the recovery of profitability that is expected to be achieved thanks in part to the projected increase in rates, should bring 2006 income to the levels estimated in the Business Plan. The Group company Bipielle SGC, which manages problem loans, is currently involved in a project for the sale without recourse of the non-performing loans pertaining to the Group's companies and banks for a total gross amount of around €1 billion, comprising around 23,000 positions. To date, the Group has received irrevocable offers to buy these loans from a number of counterparties. The majority of these offers constitute a significant gain and therefore steps are being taken to formally close the sale. During 2006, the Group company Bipielle Riscossione will transfer the business division responsible for collecting taxes to the Italian Revenue Office, as provided for in Art. 3 of Law no. 248 of December 2, 2005. As from October 21, 2006, the current system of concession in relation to the national tax collection service will be withdrawn as the duties relating to national tax collection will be assigned to the Italian Revenue Office, which will exercise these via the company Riscossioni Spa, set up alongside the INPS. The Board of Directors of the Parent Bank has already agreed to proceed with the negotiations. Finally, procedures have started to sell the shareholding in Bipielle.Net and Area Life.

11 STRUCTURE OF THE GRUPPO BANCA POPOLARE ITALIANA Distribution network As at March 31, 2006, the network of branches of the Gruppo Banca Popolare Italiana remains unchanged at 979 (977 in Italy and 2 abroad) according to the breakdown given in the table below.

31.03.2006 31.12.2005 delta 31.03.2005 Banca Popolare Italiana 559 586 - 27 585 Banca Popolare di Mantova 8 8 - 7 Cassa di Risparmi di Livorno 53 53 - 53 Cassa di Risparmio di Lucca 123 97 26 97 Cassa di Risparmio di Pisa 54 53 1 53 Banca Popolare di Crema 44 44 - 44 Banca Popolare di Cremona 74 76 - 2 76 Banca Valori 1 1 - 1 Banca CARIPE 52 50 2 49 Reti Bancarie 1 1 - 1 Efibanca 7 7 - 7 Banca Bipielle.Net 1 1 - 1 Bipielle Bank (Suisse) 1 1 - 1 London Branch 1 1 - 1 Total 979 979 - 976

In detail, the changes over the quarter by bank were as follows: • For the Parent Bank Banca Popolare Italiana, the reduction of 27 branches is due to the fact that the 26 branches (24 in Tuscany and 2 in Umbria) that make up the Area Toscana business division were sold to Cassa di Risparmio di Lucca, plus the Cefalà Diana (PA) and Erbusco (CO) branches were closed and the branch at the new Fiera di Milano was opened. • Symmetrically, the increase for Cassa di Risparmio di Lucca is due to the 26 branches bought from the Parent Bank. • For Banca Caripe, the increase of two relates to the opening of a treasury office at the local health unit in Chieti (CH) and one in Collecorvino (PE); • For Cassa di Risparmio di Pisa, the opening of the treasury office in Casciana Terme (PI); • For Banca Popolare di Cremona, the reduction of two branches comes from the closure of a treasury office in Celle Dati (CR) and one in Cingia de Botti (CR).

Human resources At Group level, the total number of employees at the end of March 2006 is 8,504, down by 94 on the figure for December 31, 2005. There are 989 financial advisors (Bipielle.Net) compared with 1,045 in December 2005.

12 OPERATING AGGREGATES

CONSOLIDATED FUNDS UNDER ADMINISTRATION

March 31, 2006 Dec 31, 2005 Items values % comp. values % change Due to customers: breakdown 1. Current accounts and demand deposits 12,000,855 80.76% 12,520,293 - 0.04 2. Savings accounts and time deposits 438,244 2.95% 126,153 2.47 3. Third-party funds under administration 5,921 0.04% 4,384 0.35 4. Loans 146,883 0.99% 143,740 0.02 4.1 finance leases 4,930 0.03% 4.2 other 141,953 0.96% 143,740 - 0.01 5. Commitments to buy back own capital instruments 6. Liabilities from assets sold but not eliminated from the balance sheet 2,235,045 15.04% 1,496,807 0.49 6.1 repurchase agreements 1,833,082 12.34% 1,226,364 0.49 6.2 other 401,963 2.70% 270,443 0.49 7. Other payables 33,743 0.23% 64,692 - 0.48 Total 14,860,691 14,356,069 0.04 Securities in issue 19,726,899 20,281,134 - 0.03 Total due to customers and securities in issue 34,587,590 34,637,203 - 0.14% Discretionary accounts 9,541,955 45.88% 9,206,135 3.65% Mutual funds 8,849,791 42.55% 9,242,826 -4.25% Insurance products 2,405,805 11.57% 2,643,343 -8.99% Total assets under management 20,797,551 100.00% 21,092,304 -1.40% Third-party securities under custody and administration of ordinary customers 15,459,048 15,777,588 -2.02% Total indirect customer deposits 36,256,599 36,869,892 -1.66% Total funds under administration of banks and institutional investors 26,311,129 27,002,021 -2.56% Grand total funds under administration 97,155,318 98,509,116 -1.37%

The grand total of customer funds under administration is €97,155 million, an increase of 1.37% on December 2005. Altogether, direct customer deposits total €34,588 million, substantially unchanged from the level recorded in December 2005 (-0.14%). In particular, Amounts due to customers total €14,861 million (+3.5%) while Securities in issue total €19,727 million (-2.73%). Of the components of Amounts due to customers, the largest component is Current accounts and demand deposits (more than €12,001 million), which despite falling by 4.2% on the figure for December 2005, accounts for around 81% of the total. As regards indirect deposits, the volumes show a 1.66% decrease approximately on the figures posted at the end of 2005. This is mainly due both to the decrease of assets under management (€20,798 million) and the administered component (€15,459 million). Of the various forms of asset management, discretionary accounts in particular increased by 3.65% and units in mutual funds decreased by around 4.25%. The figures also show a 2.56% decrease in the funds under administration of banks and institutional investors, which ended the quarter at €26,311 million. As regards deposits (current accounts, savings accounts and certificates of deposit), the following tables gives a breakdown by sector and geographical location of customers.

13 Deposits by Sector % comp. 03/2006 % comp. 12/2005 Government Bodies 2.88% 2.66% Households 62.12% 61.76% Financial Companies 9.10% 10.47% Non-Financial Companies 20.24% 19.25% Not-for-Profit Organisations 1.95% 2.05% Other 3.70% 3.82% Total 100.00% 100.00% Source: Matrice dei Conti

Households remain the main contributor to deposits with the percentage increasing from 61.8% to 62.1% of the total. Conversely, there is a reduction in the percentage attributable to non-banking financial counterparties (insurance, leasing companies, etc.) down from 10.5% to 9.1%.

Deposits by Region (branch location) % comp. 03/2006 % comp. 12/2005 Lombardy 34.25% 33.43% Tuscany 26.12% 27.25% Liguria 9.70% 9.63% Sicily 8.54% 8.32% Abruzzo 6.74% 6.64% Lazio 5.95% 5.75% Emilia Romagna 4.12% 4.43% Molise 1.49% 1.56% Piedmont 1.04% 0.85% Campania 0.61% 0.60% Trentino Alto Adige 0.58% 0.57% Veneto 0.48% 0.52% Basilicata 0.16% 0.16% Calabria 0.10% 0.10% Umbria 0.06% 0.08% Marches 0.03% 0.08% Sardinia 0.03% 0.03% Friuli Venezia Giulia 0.00% 0.01% Total 100.00% 100.00% Source: Matrice dei Conti

The regional breakdown of deposits for the whole of the Group sees no change in the significant weight of Lombardy and Tuscany but with rises also in the contributions of Liguria, Sicily and Abruzzo.

14 CONSOLIDATED LOANS

Customer loans 31/03/2006 % comp. 31/12/2005 % chng Current accounts 7,349,197 26.8% 7,686,780 -4.4% Repurchase agreements 69,330 0.3% 30,274 129.0% Mortgages 9,372,798 34.2% 9,233,325 1.5% Credit cards, personal loans and "fifth of salary" loans 1,890,057 6.9% 1,700,135 11.2% Other transactions 3,528,053 12.9% 4,913,924 -28.2% Debt securities: 16,443 0.1% 170 9572.4% Structured Other 16,443 0.1% 170 9572.4% Impaired assets 1,697,515 6.2% 1,040,557 63.1% Assets sold but not eliminated 3,474,297 12.7% 3,363,597 3.3% Total (Book value) 27,397,690 100% 27,968,762 -2.0%

In March 2006, total customer loans were €27,398 million, down by 2% on the figure of €27,969 million recorded at the end of last year. Current accounts (which represent around 27% of the total) account for €7,349.2 million, a decrease of 4.4% on December 2005, while mortgages increased by 1.5% to €9,372.8 million. Within the impaired assets component (up by around 63% to €1,697.5 million), net non-performing loans account for €736.6 million, a significant increase that can be attributed to the inclusion of the Magiste Group, written down only for the part not covered by guarantees. For this reason, the ratio of non-performing loans to loans has risen from 1.08% in December 2005 to 3.21%. The following tables show the breakdown of customer loans of the Group's banking companies in terms of the sectors and economic activity of customers, and their regional location.

Loans by Sector % comp. 03/2006 % comp. 12/2005 Government Bodies 2.32% 2.26% Households 15.96% 16.21% Financial Companies 13.20% 11.94% Non-Financial Companies 59.43% 60.23% Not-for-Profit Organisations 0.42% 0.41% Other 8.66% 8.94% Total 100.00% 100.00% Source: Matrice dei Conti

This breakdown by macro sector of economy activity of customers sees a slight reduction, compared with December 2005, in the weight of the Households component (from 16.2% to 16%) and an increase in the weight of financial companies (from 12% to 13.2%). Far outweighing the others are non-financial companies which account for just under 60% of the total.

15

Loans by Region (branch location) % comp. 03/06 % comp. 12/05 Lombardy 35.24% 36.43% Tuscany 24.37% 23.80% Lazio 21.23% 21.92% Abruzzo 5.05% 3.94% Emilia Romagna 4.45% 4.38% Liguria 3.89% 3.77% Sicily 2.61% 2.53% Veneto 1.04% 1.09% Trentino Alto Adige 0.79% 0.82% Piedmont 0.62% 0.59% Molise 0.23% 0.26% Campania 0.15% 0.14% Umbria 0.13% 0.13% Marches 0.11% 0.10% Basilicata 0.04% 0.04% Calabria 0.03% 0.03% Sardinia 0.03% 0.02% Friuli Venezia Giulia 0.01% 0.01% TOTAL 100.00% 100.00% Source: Matrice dei Conti The most important regions in terms of customer loans remain Lombardy, Tuscany and Lazio, which account for more than 80% of the total. There has been a significant development in Abruzzo, which has now reached 5%.

16 BREAKDOWN OF LOANS BY ECONOMIC ACTIVITY % comp. 2006/03 % comp. 2005/12 - Other market services 34.01% 33.60% - Commerce, salvage and repair services 12.43% 11.95% - Building and public works 11.95% 12.32% - Agriculture, forestry and fishing products 5.00% 4.94% - Hotels, bars and restaurants 4.37% 4.23% - Foodstuffs 3.86% 3.71% - Textiles 3.42% 3.39% - Energy products 2.62% 2.83% - Agricultural and industrial machinery 2.46% 2.63% - Metal products 2.40% 2.26% - Non-metallic minerals-based products and minerals 2.20% 2.24% - Sea and air transportation services 1.94% 2.16% - Paper, paper products 1.79% 1.82% - Transport-related services 1.75% 1.62% - Other industrial products 1.50% 1.63% - Minerals and ferrous and non-ferrous metals 1.44% 1.61% - Means of transport 1.35% 1.44% - Chemical products 1.33% 1.25% - Electrical materials and supplies 1.28% 1.28% - Rubber and plastic products 1.20% 1.26% - Domestic transport services 1.12% 1.17% - Office and EDP machines 0.35% 0.35% - Communications services 0.23% 0.34% TOTAL 100.00% 100.00% Source: Matrice dei Conti Here too there are no particularly significant changes. "Other market services" remains out front (34%, slight increase) together with commerce services (12.4%). Buildings and public works are slightly down (from 12.3% to 11.9%) bearing evidence of the progressive slowdown in loans disbursed to the property sector, which still continued to show interesting developments throughout 2005.

SHAREHOLDERS' EQUITY AND SHARE PERFORMANCE Group Shareholders' Equity as at March 31, 2006, including profit for the quarter, is €2,854.8 million, a 2.5% increase on the figure of €2,786.3 million recorded as at December 31, 2005. As expected, particularly after the presentation of the Business Plan, market interest in BPI has increased, especially from institutional investors. The following table shows the main shareholders of the Parent Bank as at May 10, 2006, as recorded by Consob (entities with more than a 2% shareholding):

% HELD Insight Investment Management Ltd 2.362 Gandhara Advisors Europe LLP 2.250 Amber Capital LP 2.058 Generali Assicurazioni spa 2.040 Total more than 2% shareholding 8.710 Source: Consob

As regards share performance, the Banca Popolare Italiana share price followed a growth trend recording an average price of €8.626, with a low of €7.449 at the start of the year and a high of €9.368 (February 27, 2006).

17 RATING AGENCY ASSESSMENTS The issues of the Gruppo Banca Popolare Italiana are rated by two agencies, FitchRatings and Moody’s. In 2005, both agencies placed the rating of the Gruppo BPI under negative credit watch. On February 6, 2006, Moody's completed the annual rating review process, which it had started on May 13, 2005, and reduced Banca Popolare Italiana's rating by 1 notch. FitchRatings withdrew the negative credit watch on December 21, 2005 but then reinstated it on March 16, 2006 following worsening expectations over the Gruppo BPI's 2005 annual results. On March 30, 2006, the agency FitchRating ended the credit watch by lowering the ratings of the Gruppo Banca Popolare Italiana by one notch. As at March 31, 2006, the ratings assigned to the debt of the Gruppo Banca Popolare Italiana are as follows:

FITCH RATINGS OUTLOOK Long Term Rating BBB Short Term Rating F3 Stable Individual C MOODY'S OUTLOOK Issuer Rating Baa2 Bank Deposits Baa2 Senior Unsecured Debt Baa2 Stable Subordinated Debt Ba1 Bank Financial Strength D Short Term Debt P-2

18 INCOME TRENDS The results for the first quarter of 2006 show that the Group has exited quickly from the period of difficulty and slowdown in operations that characterised the second half of last year, which had impacted heavily on income performance in 2005. In particular, the loss of the cost components and extraordinary adjustments that were a prominent feature in 2005 meant that in the first quarter of 2006 it was possible to return to broadly positive results, comparable with trends in the first quarter of 2005, which had not yet been affected by the extraordinary operations. The trend to March 2006 is also substantially in line with the income forecasts made for the period in the aforementioned 2006-2009 Business Plan, further testimony to the effective process of reorganisation currently being undertaken. absolute Reclassified income statement 31/03/2006 31/03/2005 % changes changes Net interest 182,364 216,296 (32,932) -15.69% Dividends and similar income 36 944 (908) -96.19% Profit (loss) from investments carried at equity 1,255 3,281 (2,026) -61.75% Net commissions 102,217 101,515 702 0.69% Net income from trading and hedging activities 42,726 52,124 (9,398) -18.03% Net income from assets and liabilities designated at fair value 2,741 - 2,741 n/a Other operating income (expenses) 51,552 32,385 19,167 59.18% Net operating income 382,891 406,545 (23,654) -5.82% Net adjustments to loans (37,313) (34,203) (3,110) 9.09% Net adjustments to other assets 203 - 203 n/a Personnel expenses (121,182) (122,239) 1,057 -0.86% Administrative expenses (98,957) (102,155) 3,198 -3.13% Provisions for risks and charges (1,025) (40,678) 39,653 -97.48% Net adjustments to intangible and tangible assets (15,966) (16,034) 68 -0.42% Operating expenses (274,240) (315,309) 41,069 -13.02% Net income (expenses) from insurance operations 504 (390) 894 -229.23% Income from operating activities 109,155 90,846 (46,414) 20.15% Profit (loss) from held-to-maturity financial assets and from other 28,279 257 28,022 n/a investments Income from continuing operations before tax 137,434 91,103 18,392 50.86% Income taxes on continuing operations (60,774) (39,356) (21,418) 54.42% Profit (loss) from discontinued operations after tax 3,481 - 3,481 n/a Period profit (loss) of minority interests (28,441) (21,549) (6,892) 31.98% Net income 51,700 30,198 21,502 71.20%

Net interest Net interest income as at March 31, 2006 is €182.4 million, down by 15.7% on the figure of €216.3 million recorded as at the same date last year. The fall in net interest income is principally due to increased funding costs, which are affected by the significant issues of subordinated and senior notes in the second half of 2005. Compared with March 31, 2005, interest expense increased by 13.43% while interest income fell by 1.2%, partly caused by the return of financial loans.

Net commissions Net commissions (€102.2 million) have shown a positive trend over the twelve months albeit limited to 0.7%. In detail, the trend is principally due to the reduction in commission expense (down by 10% to around €32.1 million) following the decrease in commissions paid for the placement of financial instruments. Commission income fell by 2.12% which is a much smaller fall than the year-on-year decrease of 10.5% for the year ended December 31, 2005, thus giving evidence of the recovery in the Group's commercial activities.

19 Income from trading and hedging activities Net income from trading activities was €37 million for the period ended March 31, 2006, down by 11.7% on the figure for March 2005. Net income from hedging activities is €5.7 million as at March 31, 2006 (-44%). Overall, the aggregate is down by 18% to €42.7 million, partly as a result of the policy of reducing the risk profile.

Other operating expenses and income This item has a positive balance of €51.5 million, recording a 59% increase on March 2005. The increase is due, in particular, to income generated from the additional returns on securitisations and to the sale of accessory products by Bipitalia Ducato. As a result of these trends, net operating income is €382.9 million, recording a fall of 5.8% on March 2005.

Net adjustments to loans Net adjustments to loans total €37.3 million, an increase of 9% on the figure for March 2005. In terms of the ratio to net loans, this has decreased from 2.7% in December 2005 to its current figure of 0.14%.

Operating expenses Personnel expenses were down 0.9% to €121.2 million. Even greater is the reduction in other administrative expenses, which fell from €102.2 million to €98.9 million (-3.13%), as a result of the effectiveness of the operational efficiency processes undertaken by the Group.

Provisions for risks and charges As at March 2006, this item has a value of 1.0 million, much lower than the figure of €40.7 million in March 2005. Recall that the figure for the first quarter of 2005 was due to non-recurring items such as provisions related to the Parmalat revocatory action (€30 million) and provisions for lawsuits of the former Banca Eurosistemi (€10 million).

Net adjustments to tangible and intangible assets Net adjustments to tangible and intangible assets amount to €15.9 million, substantially in line with the March 2005 figure. Overall, operating expenses fell by 13% compared with March 2005 to stand at €274.2 million. This produces an Income from operating activities of €109.2 million, compared with €90.8 million in the first quarter of 2005 (+20.1%).

Profit from disposal of held-to-maturity assets and other investments This item consists principally of the profit from the sale by Cassa di Risparmio di Lucca of the shareholding held in Banca Italease (€27.3 million). The balance of the above items produces an Income from continuing operations before tax of €137.4 million, equal to an increase of approximately 551%.

Profit from discontinued operations after tax The balance of €3.5 million corresponds to the net income of the subsidiaries Bipielle Leasing and Bipielle Riscossioni, currently being sold off. As at March 2005, these companies were not classified under this item but contributed line by line to the consolidated income.

After the assignment of Profit attributable to minority interests (€28.4 million) we finally reach a Net income for the quarter of €51.7 million, compared with €30.2 million in the same period of 2005 (+71.2%).

20 CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEET

Assets 31/03/2006 31/12/2005 10 Cash on hand and deposits with central bank and post offices 183,139 237,423 20 Financial assets held for trading 4,243,741 4,068,043 30 Financial assets at fair value 538,184 716,378 40 Available-for-sale financial assets 1,090,060 1,095,710 50 Held-to-maturity financial assets 83,462 84,630 60 Due from banks 3,791,968 4,457,197 70 Customer loans 27,397,690 27,968,762 80 Hedge derivatives 147,586 185,988 90 Adjustments to the value of financial assets under macro hedging 100 Shareholdings 482,635 487,644 110 Reinsurers' share of technical reserves 120 Property, plant and equipment 918,664 932,065 130 Intangible assets 2,061,136 2,057,370 of which: - Goodwill 2,016,282 2,010,018 140 Tax assets 1,300,759 1,305,546 a) current 244,055 243,161 b) prepaid 1,056,704 1,062,385 150 Non-current assets and discontinued operations 1,288,825 1,401,931 160 Other assets 2,738,722 2,323,828 Total assets 46,266,571 47,322,515

Liabilities and shareholders' equity 31/03/2006 31/12/2005 10 Due to banks 3,276,594 4,791,619 20 Due to customers 14,860,691 14,356,069 30 Securities in issue 19,726,899 20,281,134 40 Financial liabilities held for trading 582,097 713,354 50 Financial liabilities at fair value 323,151 316,281 60 Hedge derivatives 233,253 195,621 70 Adjustments to the value of financial liabilities under macro hedging 80 Tax liabilities 342,403 299,481 a) current 204,218 159,518 b) deferred 138,185 139,963 90 Liabilities associated with discontinued operations 522,219 613,509 100 Other liabilities 2,398,146 1,752,879 110 Employee severance payment fund 166,680 164,778 120 Provisions for contingencies and charges 461,393 504,596 a) pension fund 140,912 139,885 b) other provisions 320,481 364,711 130 Technical reserves 79,771 85,219 140 Valuation reserves 59,326 50,705 150 Redeemable shares 160 Capital instruments 3,048 3,048 170 Reserves (605,427) (375,825) 180 Issue premiums 1,974,091 2,487,324 190 Share capital 1,456,198 1,456,498 200 Own shares (-) (84,132) (91,546) 210 Minority interests (+/-) 438,470 461,664 220 Profit (loss) for the year 51,700 (743,893) Total liabilities and shareholders' equity 46,266,571 47,322,515

22 CONSOLIDATED INCOME STATEMENT

Items 31/03/2006 31/03/2005

10 Interest income and similar revenue 424,467 429,727

20 Interest expense and similar charges (242,103) (213,431)

30 Net interest income 182,364 216,296

40 Commission income 134,337 137,253

50 Commission expense (32,120) (35,738)

60 Net commissions 102,217 101,515

70 Dividends and similar income 36 944

80 Net income from trading activities 37,014 41,923

90 Net income from hedging activities 5,712 10,201

100 Profit (loss) from the sale or repurchase of:

a) loans

b) available-for-sale financial assets 28,279

c) held-to-maturity financial assets

d) financial liabilities

110 Net income from financial assets and liabilities designated at fair value 2,741

120 Total income 358,363 370,879

130 Net adjustments for impairment of:

a) loans (37,313) (34,203)

b) available-for-sale financial assets

c) held-to-maturity financial assets

d) other financial transactions 203

140 Net income from financial operations 321,253 336,676

150 Net premiums 1,300 1,812

160 Balance of other income/expenses from insurance operations (796) (2,202)

170 Net income from financial and insurance operations 321,757 336,286

180 Administrative expenses: (220,139) (224,394)

a) personnel expenses (121,182) (122,239)

b) other administrative expenses (98,957) (102,155)

190 Net provisions for contingencies and charges (1,025) (40,678)

200 Net adjustments to property, plant and equipment (10,403) (10,062)

210 Net adjustments to intangible assets (5,563) (5,972)

220 Other operating income/expenses 51,552 32,385

230 Operating costs (185,578) (248,721)

240 Gains (losses) from investments 1,255 3,281 Net income from the fair value measurement of property, plant and 250 equipment and intangible assets 260 Net adjustments to goodwill

270 Profit (loss) from sale of investments 257

280 Profit (loss) from continuing operations before tax 137,434 91,103

290 Income taxes on continuing operations (60,774) (39,356)

300 Profit (loss) from continuing operations after tax 76,660 51,747

310 Profit (loss) from discontinued operations after tax 3,481

320 Profit (loss) for the year 80,141 51,747

330 Period profit (loss) of minority interests (28,441) (21,549)

340 Period profit (loss) of parent bank 51,700 30,198

23 STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY As at March 31, 2006 Allocation of Shareholders' Change in Shareholders' period income Change in Equity - opening Equity - Dividends and reserves 31/12/2005 balance 01/01/2006 Reserves other distrib.

Share capital a) ordinary shares 1,456,498 1,456,498 b) other

Issue premiums 2,487,324 2,487,324 (512,493)

Reserves a) of profits (577,291) (577,291) (134,432) 1,909 b) other 201,466 201,466 (96,968) (678)

Capital instruments 3,048 3,048

Valuation reserves: a) available-for-sale 32,440 32,440 8,621 financial assets b) cash flow hedge c) other 18,265 18,265

Own shares (91,546) (91,546)

Period income (743,893) (743,893) 743,893

Total Parent Bank 2,786,311 2,786,311 9,852 Minority interests 461,664 461,664 (44,014) (7,672) Total 3,247,975 3,247,975 (44,014) 2,180

As at December 31, 2005 Allocation of Shareholders' Change in Shareholders' period income Change in Equity restated - opening Equity restated - Dividends and reserves 31/12/2004 (*) balance 01/01/2005 Reserves other distrib.

Share capital a) ordinary shares 885,127 885,127 b) other

Issue premiums 1,532,100 1,532,100

Reserves a) of profits (278,134) (196,633) (474,767) (14,521) (86,288) (1,715) b) other 165,950 165,950 33,045

Capital instruments 3,048 3,048

Valuation reserves: a) available-for-sale 2,653 2,653 29,787 financial assets b) cash flow hedge c) other 18,265 18,265

Own shares (80,653) (80,653)

Period income (14,521) (14,521) 14,521

Total Parent Bank 2,228,134 (190,932) 2,037,202 (86,288) 61,117 Minority interests 1,040,965 (562,421) 478,544 (60,894) Total 3,269,099 (753,353) 2,515,746 (86,288) 223 (*) Resulting from the application of IAS standards (excluding IAS 32 and 39)

24 STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY As at March 31, 2006 Shareholders' equity transactions performed in the period Shareholders' Extraordinary Change in Issue of new Purchase/Sale Deriv. on Own Profit as at Equity - distribution of capital Stock Options shares of own shares Shares 31/03/2006 31/03/2006 dividends structure

(300) 1,456,198

(740) 1,974,091

(709,814) 567 104,387

3,048

41,061

18,265

7,414 (84,132)

51,700 51,700

7,414 (1,040) 567 51,700 2,854,804 51 28,441 438,470 7,414 (1,040) 618 80,141 3,293,274

As at December 31, 2005 Shareholders' equity transactions performed in the period Shareholders' Extraordinary Change in Issue of new Purchase/Sale Deriv. on Own Profit as at Equity - distribution of capital Stock Options shares of own shares Shares 31/12/2005 31/12/2005 dividends structure

571,371 1,456,498

955,224 2,487,324

(577,291) 2,471 201,466

3,048

32,440

18,265

(10,893) (91,546)

(743,893) (743,893)

1,526,595 (10,893) 2,471 (743,893) 2,786,311 44,014 461,664 1,526,595 (10,893) - (699,879) 3,247,975 Al 31 dicembre 2004

25 CONSOLIDATED CASH FLOW STATEMENT Direct method

31.03.2006 31.12.2005 A. OPERATING ACTIVITIES 1. Operating activities 105,801 625,360 interest income collected 424,467 1,777,679 interest expense paid 242,103 1,016,846 dividends and similar income 36 62,026 net commissions 102,217 299,372 personnel expenses 121,182 543,918 net premiums collected 1,300 6,254 other insurance income/expenses 796 -5,421 other costs 56,393 456,693 other revenues 55,548 310,120 taxes 60,774 -165,208 costs/revenues relating to discontinued operations, net of taxes 3,481 16,737 2. Cash generated/absorbed by financial assets 910,336 -4,951,104 financial assets held for trading financial assets at fair value 2,496 1,401,867 available-for-sale financial assets 5,853 -1,287,563 customer loans 533,759 -3,231,788 due from banks 665,229 -955,875 other assets -297,001 -877,745 3. Cash generated/absorbed by financial liabilities -602,550 2,394,517 due to banks -1,515,025 -391,124 due to customers 504,622 -246,860 securities in issue -516,603 3,546,027 financial liabilities held for trading -131,257 712,170 financial liabilities at fair value 6,870 41,659 other liabilities 1,048,843 -1,267,355 Net cash generated/absorbed by operating activities 413,587 -1,931,227 B. INVESTING ACTIVITIES 1. Cash generated by: 47,577 744,993 sales of shareholdings 5,009 688,521 dividends collected on shareholdings sales/redemptions of held-to-maturity financial assets 39,570 56,472 sales of property, plant and equipment 2,998 sales of intangible assets sales of subsidiaries and business branches 2. Cash absorbed by: -9,329 -249,017 purchases of shareholdings purchases of held-to-maturity financial assets purchases of property, plant and equipment 38,664 purchases of intangible assets 9,329 210,353 purchases of subsidiaries and business divisions Net cash generated/absorbed by investing activities 38,248 495,976 C. FINANCING ACTIVITIES issue/purchases of own shares 6,374 1,515,702 issue/purchases of capital instruments dividends and other distributions -512,493 -86,288 Net cash generated/absorbed by financing activities -506,119 1,429,414 NET CASH GENERATED/ABSORBED IN THE PERIOD -54,284 -5,837

Reconciliation

31.03.2006 31.12.2005 Balance sheet items Amount amount Cash on hand and deposits with central bank and post offices at the start of the year 237,423 243,260 Total net cash generated/absorbed in the year -54,284 -5,837 Cash on hand and deposits with central bank and post offices: effect of exchange rate

changes Cash on hand and deposits with central bank and post offices at the end of the year 183,139 237,423

26 NOTES AND COMMENTS

STATEMENT OF CONFORMITY WITH INTERNATIONAL ACCOUNTING STANDARDS The consolidated financial statements of the Gruppo Banca Popolare Italiana have been prepared in accordance with International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS) issued by the International Accounting Standards Board (IASB) and the relative interpretations of the International Financial Reporting Interpretations Committee (IFRIC), as endorsed by the European Commission, as specified in Regulation (EC) no. 1606 of 19 July 2002, which requires all companies in the European Union that are listed on regulated markets to prepare consolidated financial statements in accordance with IAS/IFRS as from 2005. The consolidated report to March 31, 2006 has been prepared on the basis of international accounting standards in accordance with Consob resolution no. 14990 of April 14, 2005, which stipulates that the content of the report must be aligned with the provisions of the Regulations for Issuers or with the provisions of IAS 34 on interim financial reporting. In preparing the interim report, the IAS/IFRS standards in force on March 31, 2006 have been applied (including SIC and IFRIC interpretations), as endorsed by the European Commission. One development compared with those used for the year ended December 31, 2005 is the approval (Regulation EC no. 108/2006) of IFRS 7 (Financial instruments: disclosures). It is specified that the quarterly report is not audited.

GENERAL BASIS OF PREPARATION The quarterly report is prepared on a going concern basis, according to the accrual basis of accounting, in observance of the principle of relevance and materiality of information, consistent with the application of substance over form and with a view to promoting consistency with future presentations. Each material class of similar items is presented separately in the report. Items of a dissimilar nature or function are presented separately unless they are immaterial. Offsetting of assets with liabilities or income with expenses is prohibited unless it is explicitly permitted or required by a standard or by an interpretation. In accordance with Art. 5 of Legislative Decree no. 38 of February 28, 2005 and IAS 1/46, the financial statements are prepared with the euro used as the currency of account. The amounts shown in the financial statements and in the report on operations, where not specified otherwise, are stated in thousands of euro. The financial statements and tables contained in the report on operations not only show the amounts for the period in question but also the corresponding comparative data as at December 31, 2005 for the balance sheet and as at March 31, 2005 for the income statement. It is added that the income statement figures at March 31, 2005, used for the comparison, are the result of a re-statement according to the IAS/IFRS accounting standards, of the quarterly report to March 31, 2005, re- approved on March 29, 2006, prior to examination of the 2005 financial statements. This was necessary due to the changes made to the 2004 consolidated financial statements, approved by the Board of Directors on December 27 2005, and to the 2004 individual financial statements, approved by the Shareholders’ Meeting of January 28, 2006.

27 SCOPE AND METHODS OF CONSOLIDATION Shareholdings in wholly and jointly owned companies (the latter consolidated proportionally)

Type of Shareholding relationship Availability of Put % Company names Head office relation- votes % held ship (1) Shareholding company % held A. Companies A.1 Fully consolidated A.1.1 Banca Popolare di Lodi Capital Company LLC New York 1 Banca Popolare Italiana 100.00 100.00 A.1.2 Banca Popolare di Lodi Capital Company LLC II New York 1 Banca Popolare Italiana 100.00 100.00 A.1.3 Banca Popolare di Lodi Capital Company LLC III New York 1 Banca Popolare Italiana 100.00 100.00 A.1.4 Bipielle I.C.T. S.p.A. Lodi 1 Banca Popolare Italiana 100.00 100.00 A.1.5 Bipielle Investimenti S.p.A. Lodi 1 Banca Popolare Italiana 91.94 87.45 A.1.6 Reti Bancarie S.p.A. Lucca 1 Banca Popolare Italiana 73.51 70.86 0.81 A.1.7 Bipielle Riscossioni S.p.A. Lodi 1 Banca Popolare Italiana 70.12 70.12 A.1.8 Banca Popolare di Crema S.p.A. Crema 1 Reti Bancarie 94.47 94.47 A.1.9 Banca Popolare di Cremona S.p.A. Cremona 1 Reti Bancarie 99.43 99.43 1 Banca Popolare Italiana 0.04 0.04 A.1.10 Banca Popolare di Mantova S.p.A. Mantova 1 Reti Bancarie 52.32 52.32 A.1.11 Banca Valori S.p.A. Brescia 1 Reti Bancarie 61.25 61.25 A.1.12 Bipielle Società di Gestione del Credito S.p.A. Lodi 1 Reti Bancarie 70.00 70.00 1 Cassa di Risparmio di Lucca 30.00 30.00 A.1.13 Bipielle International Holding S.A. Lugano 1 Reti Bancarie 100.00 100.00 A.1.14 Cassa di Risparmio di Lucca S.p.A. Lucca 1 Reti Bancarie 46.28 46.28 1 Banca Popolare Italiana 20.93 20.93 12.39 A.1.15 Cassa di Risparmi di Livorno S.p.A. Livorno 1 Cassa di Risparmio di Lucca 100.00 100.00 A.1.16 Cassa di Risparmio di Pisa S.p.A. Pisa 1 Cassa di Risparmio di Lucca 100.00 100.00 A.1.17 Banca Caripe S.p.A. Pescara 1 Reti Bancarie 51.00 51.00 44.00 A.1.18 Bipielle Bank (Suisse) S.A. Lugano 1 Bipielle International Holding 86.00 86.00 A.1.19 Bipielle International UK Ltd. London 1 Bipielle International Holding 72.00 72.00 A.1.20 Banca Bipielle Network S.p.A. Lodi 1 Bipielle Investimenti 98.86 98.86 A.1.21 Bipitalia Alternative SGR S.p.A. Lodi 1 Bipielle Investimenti 20.00 20.00 1 Bipitalia Gestioni SGR 80.00 80.00 A.1.22 Bipitalia Ducato S.p.A. Lucca 1 Bipielle Investimenti 100.00 100.00 A.1.23 Bipielle Leasing S.p.A. Pisa 1 Bipielle Investimenti 99.74 99.74 A.1.24 Bipitalia Gestioni SGR S.p.A. Lodi 1 Bipielle Investimenti 96.96 96.96 A.1.25 Bipielle Real Estate S.p.A. Lodi 1 Bipielle Investimenti 100.00 100.00 A.1.26 Bipielle Fondi Immobiliari SGR S.p.A. Lodi 1 Bipielle Investimenti 100.00 100.00 A.1.27 Efibanca S.p.A. Rome 1 Bipielle Investimenti 99.61 99.61 A.1.28 Italfortune International Advisors S.A. Luxembourg 1 Bipielle Investimenti 90.00 90.00 A.1.29 Bipielle Immobili Strumentali S.p.A. Lodi 1 Bipielle Real Estate 100.00 100.00 A.1.30 Tiepolo Finance S.r.l. Conegliano 1 Banca Popolare Italiana 60.00 60.00 A.1.31 Tiepolo Finance 2 S.r.l. Milan 1 Bipielle Gestione del Credito 60.00 60.00 A.1.32 Nazionale Fiduciaria S.p.A. Brescia 1 Banca Valori 100.00 100.00 A.1.33 Critefi SIM S.p.A. Brescia 1 Nazionale Fiduciaria 100.00 100.00 A.1.34 AB Capital S.p.A. Pescara 1 Efibanca 51.00 51.00 A.1.35 Gruppo Acque Minerali Riunite S.p.A. Rome 1 Efibanca 100.00 100.00 A.1.36 Glass Italy B.V. Amsterdam (NL) 1 Efibanca 5.00 5.00 A.1.37 Gruppo Partecipazioni Italiane S.p.A. Milan 1 Glass Italy 82.67 82.67 1 Banca Popolare Italiana 7.32 7.32 A.1.38 Area Life International Assurance Ltd Dublin 1 Bipielle International Holding 100.00 100.00 A.1.39 Bipielle Previdenza Assicurativa S.r.l. Lodi 1 Banca Bipielle Network 100.00 100.00 A.1.40 Basileus S.p.A. Lodi 1 Bipielle Real Estate 100.00 100.00 A.1.41 Lido dei Coralli S.r.l. S. Teresa Gallura (SS) 1 Basileus 100.00 100.00 A.1.42 Nadir Immobiliare S.r.l. Lodi 1 Basileus 100.00 100.00 A.1.43 Sirio Immobiliare S.r.l. Lodi 1 Basileus 100.00 100.00 (1) Type of relationship: 1 = majority of voting rights in ordinary meeting 2 - dominant influence in ordinary meeting 3 = agreements with other shareholders 4 = other forms of control 5 = individual management pursuant to Art. 26, subsection 1, of Legislative Decree no. 87/92 6 = individual management pursuant to Art. 26, subsection 2, of Legislative Decree no. 87/92 7 = joint control

28 Scope of consolidation The consolidated quarterly report includes the quarterly financial statements of Banca Popolare Italiana and those of all companies controlled directly or indirectly by the latter. The scope of consolidation is determined in accordance with the provisions contained in IAS 27. This also includes all the companies considered to be associates based on IAS 28 and 31. In defining the scope of consolidation, reference is no longer made to the exclusions previously established by Italian accounting standards or the instructions contained in Legislative Decree no. 87 of January 27, 1992 or the instructions contained in Banca d'Italia measure no. 100 of July 15, 1992 as subsequently amended. Investments held for sale are treated in accordance with IFRS 5 which governs the treatment of non-current assets held for sale, both for the preparation of the 2005 annual accounts and for the figures relating to previous periods presented for comparative purposes. To determine the change in the scope of consolidation arising from the standards described above, a relevance factor was applied based on the simultaneous existence of exclusion thresholds equal to the lesser of 1% of the Parent Bank's book value and €10 million as an individual threshold and 5 times these limits as total thresholds. Companies in liquidation or not operating are also excluded. For consolidation purposes, shares received in pledge are not considered as they are not held in order to exercise control over or influence the company's management policies. Compared with the situation as at December 31, 2005, there are no changes in the scope of consolidation.

Consolidation methods Full consolidation The quarterly financial statements of the Parent Bank and of its subsidiaries are consolidated item by item by adding together the corresponding values in the assets, liabilities, shareholders' equity, income and expenses. So that the consolidated financial statements present group accounting data as if the group were an individual company, the book value of the shareholdings in each subsidiary and the corresponding part of the shareholders' equity of each subsidiary are eliminated. Any positive differences emerging from this elimination, determined on the basis of equity ratios, are recognised, after possible allocation to the assets or liabilities of the subsidiary, as goodwill under the item "Intangible Assets". Negative differences are charged to the income statement. The item "goodwill" is not subject to amortisation but, where the conditions apply, is subject to specific adjustments (impairment test). The shares in the net period profit of the subsidiaries and the stakes in the share capital and reserves that do not belong to the group are identified and allocated to third parties on the basis of equity ratios. These stakes in the profit and in the shareholders' equity are presented separately from those pertaining to the Parent Bank's shareholders. Intra-group transactions and balances and the respective income and expenses are fully eliminated.

Consolidation according to the equity method Under the equity method, the shareholding is initially stated at cost and the book value is increased or decreased in recognition of the participant's share in the associate's profits or losses which are realised after the acquisition date. This share is recognised in a specific item of the consolidated income statement. The differences between the value of the shareholding and the shareholders' equity of the affiliated company are included in the book value of the affiliated company.

ACCOUNTING POLICIES The accounting policies adopted in preparing the quarterly report, with regard to the classification, recognition, measurement and derecognition of the various asset and liability items, and the recognition of revenues and costs, remained unchanged with those adopted for the 2005 annual report to which reference should be made.

OTHER ASPECTS Again in 2006, as has happened in previous years, the Gruppo Banca Popolare Italiana will exercise the right granted under Art. 82, para. 2, of Consob Resolution no. 11971 of May 14, 1999 and subsequent amendments, to provide shareholders and the market with a report relating not to the second quarter alone but with a semi-annual report relating to the six-month period ending June 30, 2006 within 75 days of that date.

29 INFORMATION ON THE CONSOLIDATED BALANCE SHEET ASSETS

Financial assets held for trading Financial assets/liabilities held for trading: breakdown by category

31/03/2006 31/12/2005

A. Cash assets Debt securities 1,690,236 1,365,439 Equities and units in OICR 965,245 1,115,793 Assets sold but not eliminated 1,032,263 1,053,752 Total A 3,687,744 3,534,984 B. Derivative instruments (net value) Financial derivatives -22,539 -164,824 Credit derivatives -3,561 -15,471 Total B -26,100 -180,295 Total A+B 3,661,644 3,354,689

The item "Assets sold but not eliminated" includes underlying securities in repurchase agreements without the option of forward repurchase for the seller.

Available-for-sale financial assets Available-for-sale financial assets: breakdown by category

31/03/2006 31/12/2005 Listed Unlisted Listed Unlisted Debt securities: 13,778 286,734 13,778 293,671 Structured securities Other debt securities 13,778 286,734 13,778 293,671 Equities: 302,386 487,162 296,159 492,102 measured at Fair Value 302,386 296,159 18,604 measured at cost 487,162 473,498 Total 316,164 773,896 309,937 785,773

This item includes shareholdings totalling €787.5 million not held for trading and not qualifiable as interests in subsidiaries, associates and joint ventures. In particular, it includes shareholdings of less than 20%, controlling interests held in companies not yet operational as at March 31, 2006 and companies in liquidation.

30 A list of the shareholdings included in this item is given below. AVAILABLE-FOR-SALE FINANCIAL ASSETS

SHAREHOLDINGS BOOK VALUE % stake Abruzzo Sviluppo S.p.A. - Pescara 4 1.7983 Agenzia Sviluppo Simeto - Paternò (PA) 3 3.0000 Agrifactoring S.p.A. - Rome 0 2.5000 Agriturpesca S.r.l. - Trapani 5 4.7170 Air Alps Aviation Alpenlandisches Flugunternehme 500 2.6596 Alfa Iota 2002 S.r.l. - Milan 12 35.0000 Alibo S.c.a.r.l. - Bologna 41 8.0000 Alpi Eagles S.p.A. 3,000 8.8861 Andromeda Immobiliare S.r.l. - Lodi 9 100.0000 Angiolucci International S.A. - Luxembourg 650 39.3900 Antares Immobiliare S.r.l. - Lodi 9 100.0000 Antilia Immobiliare S.r.l. - Lodi 9 100.0000 Archimede 1 S.p.A. - Venice 8,492 15.0000 Area Giochi Holding S.p.A. - Verona 2,058 2.0000 Argini Polcevera S.c.a.r.l. - Genoa 3 6.6700 Asteimmbili.it S.p.A. - Milan 40 2.2346 Azimuth Immobiliare S.r.l. - Bologna 16 100.0000 Banca della Nuova Terra S.p.A. - Milan 11,272 15.0000 Banca d’Italia - Rome 58,706 1.2253 Banca Popolare Provinciale Lecchese S.p.A. - Lecco 60 0.4041 Bakery Equity Luxembourg S.A. - Luxembourg 47,807 9.9500 Biasi S.p.A - Verona 2,597 10.5970 Bipitalia Residential S.r.l. - Milan 1 4.0000 Bic Liguria S.p.A. (in liquidation) - Genoa 21 0.3986 Binda S.p.A. (in liquidation) - Olgiate Olona 0 1.1487 Black & Blue GMBH - Munich 1 24.8200 Braidense Seconda S.r.l. - Rome 68 100.0000 B.S.R. Gestioni Turistiche Immobiliari S.r.l. - Santa Teresa di Gallura (SS) 17 100.0000 Bussentina S.c.a.r.l. - Rome 0 20.0000 Buy2build S.p.A. - Rome 10 2.0000 Cafindustria dell'Emilia Centrale S.p.A. - Bologna 1 0.4818 C.A.R.S. - Imola 1 3.4388 CA.RI.CE.SE 5 0.0704 Carfid S.r.l. - Rome 92 100.0000 Cattolica Assicurazioni S.p.A. - Verona 14 0.0013 Centrale dei Bilanci S.r.l. - Turin 2,636 5.8333 Centro Agro-Alimentare Valle Pescara Scarl - Cepagatti (PE) 281 1.5755 Centro Tessile Cotoniero S.p.A. - Busto Arsizio 21 0.6743 Centro Factoring S.p.A. - Florence 600 1.8711 Centro Pensioni Complementari Regionali S.p.A. - Bolzano 103 0.0605 Centrofidi Terziario S. Cons. P.A. - Lucca 1,200 8.5714 Centro Servizi Promozione Imprenditoriale Bic S.r.l. - Livorno 2 1.0397 CE.VAL.CO S.p.A. - Campiglia Marittima 11 0.9474 CFN Class Financial Network S.p.A. - Milan 9 0.3001 Cim Italia S.p.A. - Bergamo 288 9.6795 Cinecittà Studio S.p.A. - Rome 2,500 7.5000 Cithef Scarl - Pozzuoli 1 9.0000 Co.Im.A. S.r.l. - Acireale (CT) 220 33.3300 Colombera S.p.A. - Iseo (BS) 158 3.0650

31 SHAREHOLDINGS BOOK VALUE % stake Compagnia dei Salari S.r.l. - Rome 13 19.4460 Consorzio Per lo Sviluppo Industriale dell'Area Chieti - Pescara 0 0.0933 Consorzio Bancario SIR (in liquidation) - Rome 0 0.1320 Consulservice S.r.l. - Cavallino 1 0.7447 Cooperativa Artigiana di Garanzia Imolese - Imola 5 5.1179 Cooperativa Artigiana di Garanzia Bolognese Federfidi - Bologna 5 0.8808 Costruttori Romani Riuniti Grandi Opere S.p.A. - Rome 26 0.5000 CPL Concordia Scarl - Concordia sulla Secchia 932 8.9020 Cremona Fiere S.p.A. - Cremona 52 5.0000 C.R.I.F. S.p.A. - Bologna 15 0.5949 De Fonseca S.p.A. - Turin 6,000 15.0000 Deltadator S.p.A. - Gardolo (TN) 6,330 16.9000 Dorogest S.p.A. - Ravenna 2 15.0000 Ecofor Service S.p.A. - Pontedera 19 0.3462 Edison S.p.A. - Milan 8,491 0.2440 Earchimede S.p.A. - Brescia 25,000 11.9200 E-Geos S.p.A. - Matera 2 2.0000 E-Mid S.p.A. - Milan 196 3.2500 Ente per lo sviluppo zona industriale - Pisa 0 19.7300 Eurobic Abruzzo S.c.a r.l. - Chieti 1 0.0940 Eurocasse Sim S.p.A. in liquidation – Milan 0 20.9808 Euromobiliare Asset Management S.p.A. - Milan 1 0.0080 Euros S.p.A. Cefor & Istinform Consulting - Rome 104 5.1900 Eurovita Assicurazioni S.p.A. - Rome 1,580 2.1615 Evam S.p.A.- Massa 3 0.1057 Evoluzione 94 S.p.A. - Milan 1,646 13.9868 Farma.Cer. S.p.A. - Cernusco sul Naviglio 232 10.0000 Faster Holding S.p.A. - Milan 2,908 15.0000 Federazione Campana delle BCC - Salerno 27 0.9271 Ferfina S.p.A. - Rome 8,597 15.0000 Fidia S.p.A. - Florence 1,732 8.0000 Fidi Toscana - Florence 2,309 3.5762 Filse S.p.A. - Genoa 1,304 5.5462 Finanziaria ICCRI BBL in liquidation - Milan 1,309 50.0000 Finba Bakery Holding GMBH - Frankfurt 30,058 4.6000 Finba Bakery Netherlands B.V. - Amsterdam 15,188 4.6000 Fingruppo Holding S.p.A. - Brescia 1,328 0.1925 Finligure S.p.A. in liquidation - Genoa 0 0.8360 Fiera di Forlì S.p.A. - Forlì 5 0.0722 Fioroni Sistema S.p.A - Perugina 0 1.7780 Fira - Finanziaria Regionale Abbruzzese S.p.A. - Pescara 506 9.8000 Fira Servizi S.r.l. 150 15.0000 Firenze Mostre S.p.A. - Florence 98 4.4444 Fival S.c.a r.l. - Pescara 4 6.5300 Flashmallit S.p.A. in liquidation - Rome 0 15.5960 Fondazione Teatro A. Ponchielli S.p.A. - Cremona 60 10.0000 Framo S.c.a.r.l. - Bologna 8 75.0000 Generale de Santè S.A. - Paris 87,415 7.9990 Geofor S.p.A. 44 0.3462 Geofor Patrimonio S.p.A. 41 0.3462 GE.S.T. - Campobasso 1 0.4350

32 SHAREHOLDINGS BOOK VALUE % stake Ghenos Consultant S.r.l. - Salerno 14 1.3750 H.D.C. S.p.A. - Milan 0 15.1350 Hopa S.p.A. - Brescia 181,834 7.4006 Hotel Project Lisboa Lda - Lisbon 18 50.0000 I.A.M. Piaggio S.p.A. in extraordinary administration - Genoa 0 1.4460 ILI Autostrade S.p.A. - Genoa 87 7.0000 Industria Adriatica Confezioni S.p.A. in temporary receivership - Chieti 211 9.0000 I.C.C.R.E.A. Holding - Rome 47 0.0093 Immobiliare Barberini S.r.l. - Rome 1,657 7.6160 Imolascalo - Imola 52 1.2675 Interbrennero S.p.A. - Trento 13 0.2563 Industria e Università S.r.l. - Varese 53 0.5882 Internazionale Marmi e Macchine Carrara S.p.A. - Carrara 206 1.3475 Interporto Toscano A. Vespucci S.p.A. - Livorno Guasticce 319 2.6359 Interporto Val Pescara S.p.A. - San Giovanni Teatino (CH) 44 4.2500 Iniziative Urbane S.p.A. - Trento 516 5.5550 I.R.F.I.S. - Palermo 70 0.1921 Istituto Centrale delle Banche Popolari Italiane S.p.A. - Milan 18,053 10.6422 Istituto Europeo di Oncologia S.r.l. - Milan 1,873 2.3548 Isveimer S.p.A. in liquidation - Naples 0 0.0617 Kinlab S.p.A. - San Giovanni Teatino (CH) 0 20.2300 Kiwi.com Serv. De Consultoria S.A. 60 0.1460 Ligurcapital S.p.A. - Genoa 227 3.8636 Lisbona Immobiliare S.r.l. - Lodi 30 100.0000 Lucca polo Fiere & Tecnologia S.p.A. - Lucca 178 3.0000 LU.CEN.SE. S.p.A. - Lucca 44 12.5000 Mandelli S.p.A. in extraordinary administration - Piacenza 0 4.5030 Marina Chiavari - Servizi Portuali e Turistici S.r.l. - Chiavari 0 0.0100 Meliorbanca S.p.A. 60,536 12.2243 Moby S.p.A. - Milan 6,940 3.4702 Navicelli di Pisa - Pisa 47 6.7747 Nuovo Mondo S.c.a.r.l. in liquidation - Genoa 1 10.0000 Oglio Po Terre d'Acqua S.consortile a r.l. - Calvatone 1 2.0920 Ospedaletto Servizi Soc. coop.r.l. - Pisa 1 3.8462 P.B. S.r.l. - Milan 7 5.7395 Pegaso Immobiliare S.r.l. - Lodi 10 100.0000 Pensplan Invest SGR - Bolzano 439 4.4444 Perseo Immobiliare S.r.l. - Lodi 10 100.0000 Piaggio & C. S.p.A. - Pontedera (PI) 574 0.1501 Plastisud S.r.l. - Sulmona (AQ) 187 20.5400 Porta di Roma - Rome 10,329 2.9850 Porto Industriale di Livorno S.p.A. - Livorno 559 12.1457 Portone S.c.a.r.l. in liquidazione - Rome 8 30.0000 Promozione e Sviluppo Val di Cecina - Rosignano Marittimo 1 5.5305 Qualiter S.c.a r.l. - Pescara 24 30.0000 Quantoro S.r.l. - Mosciano Sant'Angelo (TE) 0 23.3300 Reindustria S.c.r.l. - Cremona 10 10.0000 Royle West Limited - Dublin 10 1.0000 SAGA - Società Abruzzese Gestione Aeroporto S.p.A. - Pescara 424 10.7283 S.A.T. Società Autostrada Tirrenica - Rome 92 0.3483 Società Interbancaria per l'Automazione - S.I.A. S.p.A. - Milan 32 0.1331

33 SHAREHOLDINGS BOOK VALUE % stake Seim S.r.l. in liquidation - Rome 0 10.0000 Servizi Assicurativi S.r.l. in liquidation - Mantova 0 100.0000 Simest S.p.A. - Rome 560 0.2650 Sintonia Finance S.r.l. - Milan 1 5.0000 Si Holding S.p.A. Gruppo Cartasì - Rome 339 1.5816 Siteba S.p.A. – Milan 22 0.9224 SI.TE.L - Livorno 1 1.3557 Società Cooperativa per Case Popolari in Cremona a r.l. - Cremona 0 22.0300 Società Cooperativa Luzzatti Luigi - Rome 0 0.0000 Società Aereoporto Toscano Galileo Galilei S.p.A. - Pisa 538 7.5513 Società di Area Terre di Faenza S.c. a r.l. - Riolo Terme 6 5.8511 Società di Gestione per il Realizzo S.p.A. - Rome 192 1.2589 Società di Sviluppo Vigo di Fassa S.p.A. - Vigo di Fassa 0 13.4715 Solidarietà e Finanza Sim S.p.A. - Milan 413 20.0000 Spal Automotive S.r.l. - Correggio 5,630 12.0000 S.S.B. – Società per i Servizi Bancari S.p.A. - Milan 31 0.5736 Polis Fondi SGR S.p.A. - Milan 287 9.8000 S.T.A.I. - Imola 3 2.5126 Sviluppo Genova S.p.A. - Genoa 230 5.0000 Sviluppo Turistico Lago d'Iseo S.p.A. - Iseo (BS) 8 0.2430 Swift - Society for Worldwide Interbank Financial Telecommunication - Brussels 74 0.0686 Tirrena Professional Factor 0 69.5000 Tirreno Brennero S.r.l. - Rome 7 1.3642 Tre Pi S.p.A. in composition with creditors - Rome 0 20.0000 TV Files S.p.A. - Rome 0 1.2130 UBS AG - Zurich 2 0.0000 Unipol Assicurazioni S.p.A. - Bologna 145,944 2.3074 Visa Europe Limited 0 0.0267 Zucchetti. Com S.r.l. - Lodi 128 15.0000 Total available-for-sale financial assets- shareholdings 787,566

Held-to-maturity financial assets Held-to-maturity financial assets: breakdown by category

31/03/2006 31/12/2005 Book value Book value Debt securities: 83,462 84,630 Structured Other debt securities 83,462 84,630 Total 83,462 84,630

34 Due from banks Due from banks: breakdown by category

31/03/2006 31/12/2005 Due from central banks 287,597 229,587 Mandatory reserve 287,597 229,587 Due from banks 3,504,371 4,227,610 Current accounts and demand deposits 888,440 1,077,686 Savings accounts 1,989,385 1,994,530 Other loans 550,863 725,361 Debt securities 38,613 22,520 Impaired assets 632 Assets sold but not eliminated 36,438 407,513 Total (book value) 3,791,968 4,457,197

Customer loans Customer loans: breakdown by category

31/03/2006 31/12/2005 Current accounts 7,349,197 7,686,780 Repurchase agreements 69,330 30,274 Mortgages 9,372,798 9,233,325 Credit cards, personal loans and "fifth of salary" loans 1,890,057 1,700,135 Other transactions 3,528,053 4,913,924 Debt securities 16,443 170 Impaired assets 1,697,515 1,040,557 Assets sold but not eliminated 3,474,297 3,363,597 Total (Book value) 27,397,690 27,968,762

Assets sold but not eliminated essentially consist of home and commercial mortgage loans which were securitised in the years 2004 and 2005. The following tables shown the situation of amounts due from customers as at March 31, 2006 compared with the corresponding figures as at December 31, 2005. Cash and off-balance-sheet exposures to customers: gross and net values

31/03/2006

Gross exposure Specific adjustments Portfolio adjustments Net exposure

CASH EXPOSURE Non-performing loans 1,698,424 -765,621 -54,537 878,266 Problem loans 564,653 -173,156 -13,925 377,572 Restructured exposures 139,774 -29,293 110,481 Expired exposures 433,628 -1,235 -76,351 356,042 Country risk 141,197 -19,194 122,003 Other assets 25,813,354 -260,028 25,553,326 TOTAL 28,791,030 -969,305 -424,035 27,397,690

Coverage of non-performing loans, before the write-offs made as part of the transfers to Bipielle SGC, is 60% compared with 78% as at December 31, 2005. The reduction in coverage is attributable to the inclusion under non-performing loans in 2006 of the Magiste Group, written down only for the part not covered by guarantees.

35 31/12/2005

Gross exposure Specific adjustments Portfolio adjustments Net exposure

CASH EXPOSURE Non-performing loans 928,046 - 580,631 - 46,486 300,929 Problem loans 571,574 - 181,388 - 13,288 376,898 Restructured exposures 143,319 - 29,079 114,240 Expired exposures 472,693 - 6,548 - 83,770 382,375 Country risk 141,313 - 19,193 122,120 Other assets 27,216,433 - 544,233 26,672,200 TOTAL 29,473,378 -797,646 -706,970 27,968,762

Shareholdings Shareholdings in jointly owned companies (valued according to the equity method) and in companies subject to significant influence: information on shareholding relationships

Availability Consolidated Names Head office Type of relationship Shareholding company % stake % put of votes % book value - Arca SGR S.p.A. Milan significant influence Banca Popolare Italiana 10.28 10.28 15,178 Banca Popolare di Crema 5.12 5.12 Banca Popolare di Cremona 5.31 5.31 - Bipitalia Broker S.r.l. Milan significant influence Banca Popolare Italiana 95.00 95.00 1,217 - Cartesio Alternative Investments SGR S.p.A. Milan significant influence Banca Popolare Italiana 40.00 40.00 1,197 - Centrosim S.p.A. Milan significant influence Banca Popolare Italiana 5.00 5.00 5,604 Banca Popolare di Crema 4.85 4.85 Banca Popolare di Cremona 2.50 2.50 Cassa di Risparmio di Lucca 5.00 5.00 Cassa di Risparmio di Pisa 5.00 5.00 - Unione Fiduciaria S.p.A. Milan significant influence Banca Popolare Italiana 4.00 4.00 4,583 Banca Popolare di Crema 20.00 20.00 - Cassa di Risparmio di Bolzano S.p.A. Bolzano significant influence Reti Bancarie 19.99 19.99 202,333 - Assipromos S.r.l. Livorno significant influence Cassa di Risparmi di Livorno 34.00 34.00 16 - Castimm S.r.l. Livorno significant influence Cassa di Risparmi di Livorno 100.00 100.00 1,215 - Finoa S.r.l. Milan significant influence Bipielle Investimenti 50.00 50.00 81,857 - Buon Viaggio S.p.A. Milan significant influence Bipielle Investimenti 50.00 50.00 690 - Royle West Ltd Dublin significant influence Bipielle Investimenti 99.00 99.00 Bipielle Previdenza 1.00 1.00 Assicurativa - Ali S.p.A. Rome significant influence Efibanca 28.35 28.35 4,488 Volpiano - Comital Saiag S.p.A. significant influence Efibanca 28.50 29.57 23,930 (TO) - Deroma S.p.A. Malo (VC) significant influence Efibanca 38.71 38.71 12,203 - Efibanca Palladio Finanziaria SGR S.p.A. Milan significant influence Efibanca 50.00 50.00 5,430 Abano - Fidia Farmaceutici S.p.A. Terme significant influence Efibanca 20.00 20.00 16,972 (PD) - Gruppo Palladio Finanziaria Vicenza significant influence Efibanca 21.21 21.21 21.21 80,739 - IGLI S.p.A. Milan significant influence Efibanca 20.00 20.00 24,024 Ortona - Tortella S.p.A. significant influence AB Capital 21.51 21.51 959 (CH) 482,635

36 LIABILITIES

Due to customers Due to customers: breakdown by category

31/03/2006 31/12/2005 Current accounts and demand deposits 12,000,855 12,520,293 Savings accounts and time deposits 438,244 126,153 Third-party funds under administration 5,921 4,384 Loans 146,883 143,740 Liabilities from assets sold but not eliminated from the balance sheet 2,235,045 1,496,807 Other payables 33,743 64,692 Total 14,860,691 14,356,069

Securities in issue Securities in issue: breakdown by category

31/03/2006 31/12/2005 Book value Book value Listed securities 2,079,858 Bonds 2,079,858 structured other 2,079,858 Unlisted securities 19,726,899 18,201,276 Bonds 15,971,990 13,237,279 structured 1,107,203 1,184,125 other 14,864,787 12,053,154 Other securities 3,754,909 4,963,997 structured 32,739 35,013 other 3,722,170 4,928,984 Total 19,726,899 20,281,134

37 INFORMATION ON THE CONSOLIDATED INCOME STATEMENT

Interest Interest income and similar revenue: breakdown

Performing financial assets Impaired Total Total Debt financial Other Loans 31/03/2006 31/03/2005 securities assets Financial assets held for trading 37,316 189 37,505 31,265 Financial assets at fair value 546 546 Available-for-sale financial assets 1,320 1,320 Held-to-maturity financial assets 19 19 Due from banks 1,601 23,113 191 24,905 14,200 Customer loans 4,619 307,910 2,742 24,962 340,233 356,045 Hedge derivatives 10,896 10,896 25,477 Financial assets sold but not eliminated 1,644 6,782 8,426 2,218 Other assets 617 617 522 Total 45,402 332,667 2,950 43,448 424,467 429,727

Interest expense and similar charges: breakdown

Total Total Payables Securities Other liabilities 31/03/2006 31/03/2005 Due to banks 28,361 28,361 29,791 Due to customers and financial entities 45,732 60 45,792 41,867 Securities in issue 165,078 1,393 166,471 141,765 Financial liabilities held for trading 1,437 1,437 Other liabilities and provisions 42 42 8 Total 74,093 165,078 2,932 242,103 213,431

38 Commissions Commission income: breakdown

31/03/2006 31/03/2005

a) guarantees given 4,660 4,311 b) credit derivatives 45 c) management, brokerage and consulting services: 71,989 67,129 1. trading of financial instruments 3,325 2,846 2. foreign currency trading 1,687 1,598 3. discretionary accounts 35,948 32,704 3.1. individual 15,946 12,182 3.2. collective 20,002 20,522 4. custody and administration of securities 2,471 3,052 5. custodian bank 2,339 2,261 6. securities placement 11,561 9,389 7. acceptance of instructions 7,962 6,491 8. consulting activities 782 770 9. distribution of third-party services 5,914 8,018 9.1. Individual discretionary accounts 510 466 9.2. insurance products 2,527 4,395 9.3. other products 2,877 3,157 d) collection and payment services 17,018 19,095 e) servicing for securitisation transactions 1,121 1,701 g) tax collection services 3,532 h) other services 39,549 41,440 Total 134,337 137,253

Commission expense: breakdown

31/03/2006 31/03/2005

a) guarantees received 89 263 b) credit derivatives 388 c) management, brokerage and consulting services: 22,990 26,602 1. trading of financial instruments 1,534 1,778 2. foreign currency trading 50 9 4. custody and administration of securities 520 1,029 5. placing of financial instruments 8,168 14,750 6. Non-branch offer of securities, products and services 12,718 9,036 d) collection and payment services 3,706 3,431 e) other services 5,335 5,054 Total 32,120 35,738

39 Net income from trading activities Net income from trading activities: breakdown

31/03/2006

Capital gains Trading profits Capital losses Trading Net income

(A) (B) (C) losses (D) (A+B)-(C+D)

Financial assets held for trading 22,695 56,141 (5,295) (31,633) 41,908 Debt securities 2,933 36,484 (1,764) (29,739) 7,914 Equities 16,411 19,334 (3,328) (1,654) 30,763 Units in OICR 1,688 19 (102) 1,605 Loans Other 1,663 304 (101) (240) 1,626 Financial liabilities held for trading (97) (97) Debt securities Payables Other (97) (97) Other financial assets and liabilities: exchange differences X X X X 3,645 Derivative instruments 136,733 236,986 (60,080) (323,637) (9,998) Financial derivatives: 130,778 228,752 (48,175) (323,637) (12,282) - Debt securities and interest rates 101,495 133,768 (14,555) (207,174) 13,534 - Equities and equity indices 22,054 91,053 (27,650) (111,650) (26,193) - Currencies and gold X X X X 1,556 - Other 7,229 3,931 (5,970) (4,813) 377 Credit derivatives 5,955 8,234 (11,905) 2,284 TOTAL 159,331 293,127 (65,375) (355,270) 37,014

40 Administrative expenses Personnel expenses: breakdown 31/03/2006 31/03/2005 Employees 118,553 119,553 Wages and salaries 84,636 83,988 Social security contributions 22,159 22,623 Employee severance payment 687 Provision to the employee severance payment fund 4,751 5,794 Provision to the pension fund: 1,241 2,783 Payments to external supplementary pension funds 1,090 Costs arising from payment agreements based on own capital instruments 618 880 Other employee benefits 3,371 3,485 Other personnel 1,439 1,521 Directors 1,190 1,165 Total 121,182 122,239

Other administrative expenses

31/03/2006 31/03/2005 Indirect taxes 14,910 14,661 Rents payable 27,276 27,928 Maintenance costs and overheads 9,431 11,222 Cleaning of premises 1,481 1,628 Electricity, heating and water 3,173 2,858 Printing and stationery 1,120 1,411 Postal and telephone 8,770 8,792 Security 1,168 810 Transport 2,778 2,706 Insurance premiums 2,404 2,515 Advertising, publicity and publications 4,631 2,881 Entertainment expenses 435 577 Memberships 810 871 Contributions to organisations and associations 1,249 335 Costs of professional services 7,876 10,159 Costs of IT services and outsourcing 2,800 2,183 Auditors' fees 487 475 Other expenses 8,158 10,143 Total 98,957 102,155

Other operating expenses and income Other operating expenses and income: breakdown 31/03/2006 31/03/2005 Rents receivable 1,543 1,890 Charges payable by third parties 19,882 20,895 Other income 45,671 23,880 Other miscellaneous expenses (15,544) (14,280) Total 51,552 32,385

The item "other income" includes costs recovered from customers on overdrawn current accounts and deposits totalling €18.3 million.

41 SEGMENT REPORTING

This section shows the consolidated results divided according to business segment in accordance with IAS 14. In particular, the Gruppo BPI has chosen the following means of presenting its results:

• Primary reporting: consolidated results broken down by business segment • Secondary reporting: results broken down by geographical area

1. PRIMARY SEGMENT REPORTING

Procedure for determining segment results Business segments are categorised by classifying the various group companies according to the primary activity performed by each. The results of each segment are therefore obtained by adding together the individual financial statements of the legal entities allocated to each segment. This choice will remain as long as the following principles can be observed: • completeness and reliability of the internal management systems (with particular regard to the sales network management committee, finance area management committee and cost allocation) • reconciliation between operational and accounting data • historical record of at least 12 months (for comparison with the previous year) On this matter, it is pointed out that the Gruppo BPI has, for almost one year now, been developing an internal project aimed at increasing the degree of completeness and reliability of its information and management system. Once fully operational, the new system will identify more analytical segment data and therefore closer to the Group's business reality. This aspect, which is particularly significant with regard to the current "Retail Banks" segment, will also enable this to be broken down according to the customer segmentations that will be adopted under the new organisational and commercial structure currently being defined.

Breakdown of business segments The segments identified are as follows: • Retail Banking • Asset Management • Investment Bank • Product Companies • Real Estate • Other Activities.

42 A breakdown is given below of the group's legal entities whose results count towards the result of each segment:

Retail banking Asset management Investment Bank Product Companies Real Estate Other Activities Banca Popolare Italiana Bipitalia Gestioni SGR Efibanca S.p.A. Bipitalia Ducato S.p.A. Bipielle Real Estate S.p.A. Bipielle Investimenti Reti Bancarie S.p.A. S.p.A. AB Capital S.p.A. Banca Bipielle Network Bipielle Immobili S.p.A. C.R. di Lucca S.p.A. Bipitalia Alternative S.p.A. Strumentali S.p.A. Bipielle ICT S.p.A. C.R. di Pisa S.p.A. S.G.R. S.p.A. Bipielle Leasing S.p.A. Basileus S.p.A. Bipielle int. holding SA C.R. di Livorno S.p.A. Bipielle Fondi Immobiliari Bipielle Riscossioni S.p.A. Nadir S.r.l. Banca Pop. di Lodi Banca Pop. di Crema SGR S.p.A. Area Life International Sirio S.r.l. Capital Company L.L.C. S.p.A. Nazionale Fiduciaria Assurance Ltd Lido dei Coralli S.r.l. Banca Pop. di Lodi Banca Pop. di Cremona S.p.A. Critefi Sim S.p.A. Capital Company II L.L.C. S.p.A. Italfortune Internationa Bipielle Previdenza Banca Popolare di Lodi Banca Caripe S.p.A, Advisor S.A. Assicurativa S.p.A. Capital Company III L.L.C. Banca Pop. di Mantova Bipielle Int. UK S.A Bipielle Consumer ABS Gruppo Partecipazioni S.p.A. 2004 italiane S.p.A. Banca Valori S.p.A. Bipielle Consumer ABS Glass Italy B.V. Bipielle Società di 2005 Gruppo Acque Minerali Gestione del Credito Riunite S.p.A. S.p.A. Bipielle Bank (Suisse) S.A. Tiepolo Finance S.r.l. Tiepolo Finance 2 S.r.l. Bipitalia Residential RMBS 2004 Bipitalia Residential RMBS 2005 Bipitalia Residential CMBS 2005

In order to ensure that segment results are correctly interpreted, the results attributable to "extraordinary" events occurring during 2005, i.e. those not directly relating to the typical ordinary operations of the segment within which these results were originated, are illustrated separately. The nature and scale of these operations are described in greater detail within the paragraph relating to the Retail Banking segment.

43 Segment results for the period ended March 31, 2006: income statement A breakdown is given below of the income statement results for the first quarter of 2006.

Retail Product Other Asset Mng Invest. Bank Real Estate Interc. Consol. Banking comps. Activities Net interest income 143,572 324 17,647 26,397 -6,576 616 384 182,364

Net commissions 82,700 10,350 10,983 4,115 -10 -2 -5,919 102,217

Net income from trading activities 27,615 261 5,120 4,018 37,014

Other costs/revenues 33,009 96 1,222 2,744 -303 36,768

Total income 286,896 11,031 34,972 37,274 -6,586 614 -5,838 358,363

Writedowns -25,061 -1,820 -10,432 203 -37,110

Net income from financial operations 261,835 11,031 33,152 26,842 -6,383 614 -5,838 321,253 Net income from financial and insurance 261,835 11,031 33,152 27,346 -6,383 614 -5,838 321,757 operations Operating costs and investment income -174,726 -3,555 -10,177 -9,053 10,152 -738 3,774 -184,323 Profit (loss) from continuing operations 87,109 7,476 22,975 18,293 3,769 -124 -2,064 137,434 before tax

Segment results for the period ended March 31, 2006: balance sheet A breakdown is given below of the balance sheet figures for the first quarter of 2006.

Retail Product Other Balance Sheet Asset Mng Invest. Bank Real Estate Interc. Consol. Banking comps. Activities Due from banks 5,557,841 33,995 233,357 299,452 104,566 7,489 -2,444,732 3,791,968

Customer loans 23,179,345 24,616 4,287,861 2,744,788 16,955 -2,855,875 27,397,690

Shareholdings 2,989,519 1,033 248,553 1,850,459 -4,515,929 482,635

Other assets 9,744,315 114,785 746,200 1,634,335 1,033,523 1,810,879 489,759 14,594,278

Total assets 41,380,020 174,429 5,515,971 4,678,575 1,138,089 3,685,782 10,306,295 46,266,571

Due to banks 2,620,788 24,400 1,549,726 2,096,000 612,739 167,755 3,794,814 3,276,594

Due to customers 14,776,290 2,829 10,631 250,839 26 -179,924 14,860,691

Securities in issue 16,969,307 2,841,358 792,594 600,000 1,476,360 19,726,899

Shareholders' eqty 1) 3,054,234 68,484 705,585 354,654 362,660 1,903,672 -3,646,185 2,803,104

Other liabilities 3,959,401 78,716 408,671 1,184,488 162,690 1,014,329 -1,209,012 5,599,283

Total liabilities 41,380,020 174,429 5,515,971 4,678,575 1,138,089 3,685,089 -10,306,295 46,266,571

1) This figure does not include minority interests and income for the period.

44

2. SECONDARY SEGMENT REPORTING As a basis for secondary segment reporting, the Gruppo BPI has chosen to break down its results by Geographical Area. The Gruppo BPI is present over almost all of the domestic market with a particular concentration in centre north areas. The identified segments are therefore: Italy, Abroad. The legal entities Banca Pop. di Lodi Capital Company L.L.C, Banca Pop. di Lodi Capital Company II L.L.C, Banca Pop. di Lodi Capital Company III L.L.C, Italfortune International Advisor S.A., Bipielle Bank (Suisse) S.A., Bipielle international holding S.A., Bipielle International U.K. S.A. and Area Life International Assurance Ltd contribute to the result of the "Abroad" segment. The remaining legal entities belong to the "Italy" segment.

Thousands of EURO Italy Abroad Total Group

Net interest income 181,968 396 182,364

Total income 351,567 6,796 358,363

Net income from financial operations 314,457 6,796 321,253

Net income from financial and insurance operations 314,457 7,300 321,757

Operating costs -179,311 -5,012 -184,323

Profit (loss) from continuing operations before tax 135,146 2,288 137,434

45

APPENDICES

Quarterly changes in the Consolidated Income Statement

fourth third second first quarter first quarter Income Statement quarter quarter quarter 2006 2005 2005 2005 2005 10. Interest income and similar revenue 424,467 343,291 540,098 464,563 429,727 20. Interest expense and similar charges -242,103 -235,160 -291,205 -277,050 -213,431 30. Net interest income 182,364 108,131 248,893 187,513 216,296 40. Commission income 134,337 138,592 152,371 152,651 137,253 50. Commission expense -32,120 -33,177 -41,368 -171,212 -35,738 60. Net commissions 102,217 105,415 111,003 -18,561 101,515 70. Dividends and similar income 36 759 3,057 57,266 944 80. Net income from trading activities 37,014 -93,408 -5,841 9,639 41,923 90. Net income from hedging activities 5,712 2,665 18,438 16,052 10,201 100. Profit (loss) from the sale or repurchase of: 28,279 14,778 34,123 -963 a) loans 930 14 -944 b) available-for-sale financial assets 28,279 20,478 27,460 c) held-to-maturity financial assets -6,630 6,649 -19 d) financial liabilities 110. Net income from financial assets and liabilities at fair value 2,741 -4,924 6,068 91,909 120. Total income 358,363 133,416 415,741 342,855 370,879 130. Net adjustments for impairment of: -37,110 -552,056 -70,094 -325,641 -34,203 a) loans -37,313 -329,557 -70,800 -318,438 -34,203 b) available-for-sale financial assets -226,230 2,074 -2,061 c) held-to-maturity financial assets 6,510 -1,368 -5,142 d) other financial transactions 203 -2,779 140. Net income from financial operations 321,253 -418,640 345,647 17,214 336,676 150. Net premiums 1,300 -24,312 12,400 16,354 1,812 160. Balance of other income/expenses from insurance operations -796 25,389 -5,013 -12,753 -2,202 170. Net income from financial and insurance operations 321,757 -417,563 353,034 20,815 336,286 180. Administrative expenses: -220,139 -294,271 -240,937 -244,602 -224,394 a) personnel expenses -121,182 -165,540 -122,229 -133,910 -122,239 b) other administrative expenses -98,957 -128,731 -118,708 -110,692 -102,155 190. Net provisions for contingencies and charges -1,025 -31,884 -16,358 -172,486 -40,678 200. Net adjustments to property, plant and equipment -10,403 -30,032 -9,231 -10,289 -10,062 210. Net adjustments to intangible assets -5,563 -6,325 -9,105 -3,626 -5,972 220. Other operating income/expenses 51,552 94,818 1,161 94,724 32,385 230. Operating costs -185,578 -267,694 -274,470 -336,279 -248,721 240. Gains (losses) from investments 1,255 -27,345 12,737 5,306 3,281 260. Net adjustments to goodwill -31,635 -10,400 270. Profit (loss) from sale of investments 824 -257 257 280. Profit (loss) from continuing operations before tax 137,434 -743,413 91,301 -320,815 91,103 290. Income taxes on continuing operations -60,774 141,177 -47,913 111,300 -39,356 300. Profit (loss) from continuing operations after tax 76,660 -602,236 43,388 -209,515 51,747 310. Profit (loss) from discontinued operations after tax 3,481 16,737 320. Profit (loss) for the year 80,141 -585,499 43,388 -209,515 51,747 330. Period profit (loss) of minority interests -28,441 -5,412 -14,781 -2,272 -21,549 340. Period profit (loss) of parent bank 51,700 -590,911 28,607 -211,787 30,198

49

Contents

MANAGEMENT BODIES 3

GRUPPO BANCA POPOLARE ITALIANA 4

GRUPPO BANCA POPOLARE ITALIANA FINANCIAL HIGHLIGHTS 6

EVENTS AFTER MARCH 31, 2006 AND BUSINESS OUTLOOK 9

CONSOLIDATED FUNDS UNDER ADMINISTRATION 13

CONSOLIDATED LOANS 15

INCOME TRENDS 19

CONSOLIDATED FINANCIAL STATEMENTS 21

NOTES AND COMMENTS 27

INFORMATION ON THE CONSOLIDATED BALANCE SHEET 30

INFORMATION ON THE CONSOLIDATED INCOME STATEMENT 38

SEGMENT REPORTING 42

APPENDICES 47

50