FCA Bank Group CONSOLIDATED HALF YEAR REPORT JUNE 30, 2020

FCA Bank Group

CONSOLIDATED HALF YEAR REPORT JUNE 30, 2020

CONSOLIDATED HALF YEAR REPORT

AS AT JUNE 30, 2020

FCA Bank S.p.A.

Registered office: Corso G. Agnelli, 200 - 10135 Turin www.fcabankgroup.com - Paid-up Share Capital: Euro 700,000,000, Turin Companies Register n. 08349560014, - Tax and VAT Code 08349560014 - Entered in the Bank Register n. 5764 - Holding of FCA Bank Banking Group - Entered in the Banking Group Register - Cod. ABI 3445 - Entered in Single Register of Insurance Intermediaries (RUI) N. D00016456, Member of the National Interbank Deposit Fund.

CONTENTS

BOARD OF DIRECTORS, BOARD OF STATUTORY AUDITORS AND EXTERNAL AUDITORS ...... 16 PROFILE OF THE FCA BANK GROUP...... 17 GROUP STRUCTURE ...... 19 GEOGRAPHICAL FOOTPRINT ...... 20 RESULTS OF OPERATIONS ...... 21 THE BUSINESS LINES ...... 22 INTERIM REPORT ON OPERATIONS ...... 34 SIGNIFICANT EVENTS ...... 35 COMMERCIAL POLICIES ...... 52 FINANCIAL STRATEGY ...... 55 COST OF RISK AND CREDIT QUALITY ...... 62 RESULTS OF OPERATIONS ...... 71 EQUITY AND CAPITAL RATIO ...... 78 ORGANIZATION AND HUMAN RESOURCES ...... 82 INFORMATION TECHNOLOGY ...... 89 INTERNAL CONTROL SYSTEMS ...... 92 HALF-YEARLY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ...... 104 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ...... 113 ACCOUNTING POLICIES ...... 113 RELATED-PARTY TRANSACTIONS ...... 144 SEGMENT REPORTING AS AT JUNE 30, 2020 ...... 146 ...... 148

RESILIENT DURING THE CRISIS

Giacomo Carelli Chief Executive Officer and General Manager The six months just ended will be hard to forget. For all the fears that the pandemic injected into the European economic and social fabric, our Bank has been able to lay the groundwork for a solid restart. We went through a complex period, full of unknowns, but we never stopped planning and building our future. It was precisely the crisis that hit Italy continue to operate and produce ideas, working and innovating for a better and more sustainable future. Thanks to the professionalism and valuable contribution of all our colleagues, we have been able to reorganize rapidly our operational processes, ensuring business continuity through remote work, thanks to the technologies available within the Company, making it possible eventually to return to the office in full compliance with all the procedures on health and safety.

We managed the emergency and faced with passion and dedication the reopening of the activities after the lockdown. During the emergency, we supported those who, like the Red Cross and ANPAS, operated with courage and altruism on the frontlines of the outbreak at the service of the community, as well as different volunteer and medical assistance associations in other European countries. We made available to volunteers more than 500 vehicles and 5 high-biocontainment ambulances, to deliver medicines, food and other necessities and to foster the movement of health operators and patients.

On the other hand, in the banking area, we ensured business continuity both in Italy and in the other markets in which we operate.

requests of this type received over the past 20 years. We adopted similar measures also for the dealer networks of our manufacturing partners, extending by several months the payments coming due in the lockdown period, for a total

To accelerate the restart, we came up with original solutions, such as the loans with the first instalment payable in 2021 or the new forms of rental subscription or pay per use. All this to make vehicle purchases or rentals more accessible, giving breathing room to the sector and addressing the slack in demand created by the pandemic.

In keeping with its traditional role of mobility pioneer, Leasys launched in the market increasingly flexible solutions, both in financial and utilization terms, such as the Be Free rental product - with a deferred first payment and the possibility to terminate the contract without penalties after the 18th month and FlexRent, a service as flexible as a short-term rental and as affordable as a long-term one. Lastly, to support tourism, a sector in which

we believe a lot that has been hit really hard by the fall in demand, Leasys entered into a

We invested much energy also in sustainability, announcing an international partnership contributing to reduce CO2 in the atmosphere. In June we installed several EV charging stations in the Leasys Mobility Store at Torino Caselle airport, the first to be totally electrified in Italy out of the 300 distributed extensively in the main Italian cities, airports, ports and train stations. By the end of 2020, the number of Leasys Mobility Stores will increase in Italy, to 500, and in Europe, for a combined total of 1,700 new EV charging

Moreover, in mid-May Leasys acquired all the shares outstanding of AIXIA, an important mobility and rental company operating throughout France, which will pave the way for the development of a Mobility Stores strategy also in that country.

Other initiatives are in the offing to grasp all the opportunities that will materialize. We will place great emphasis on the energy transition, the sustainability of our offerings, digitalization and quality and transparency of the service provided to customers. FCA Bank and Leasys will continue to reflect the desire of innovation and change that characterizes this moment in history, hopefully contributing to improve the surrounding world.

Monetary policy in times of crisis

Franco Casiraghi Deputy General Manager & Chief Financial Officer Since March, the whole system of daily life has been monopolized by the global event that we are still experiencing, the spread of Covid-19. There are so many variables at stake and the nature of possible interactions so vast that the economic consequences are very difficult to predict: job loss with falling consumer confidence and consequent decline in consumption, global interactions in terms of distribution of international trade and in the value chain. Difficult to predict what will happen in the short and medium term. In the long run a new balance will be found. It is difficult to estimate its contours.

In a scenario of extreme economic uncertainty, to be noted a rapid reaction from the ECB (European Central Bank). Italy, the first European country to intervene, entered lockdown on March 11th. The ECB acted immediately the following day, on March 12th.

With monetary policy timing out to be de facto the first line of defence against the ill- effects of the virus, the focus in Eurozone has been the fast answer of ECB. Using the tools built after the crisis that started in 2008, the ECB intervention was not long in coming: on March 12th, the Frankfurt Institute announced a first series of measures to support liquidity, including more favourable conditions for TLTRO-III, while the night of purchase program to be added to the existing Asset Purchase Program (APP). The further spread of the virus and the consequent measures to distance the population with the relative impacts on the real economy, subsequently led, on June 4th, the ECB to further enhance the PEPP, i 1,350 billion).

The European Central Bank has therefore deployed its monetary policy arsenal, putting in place instruments that it did not have at the first place to manage the crisis started in 2008, to ensure the financial stability and liquidity necessary to face this new challenge.

Although not at the same speed, national governments have also taken action using new massive public debt to launch fiscal stimulus packages to support employment, businesses and sectors most affected. The European Union, on the other hand, intervened by suspending the budgetary constraints envisaged by the Stability Pact and by working on a series of common measures which, hopefully, despite many uncertainties, will not be long in coming.

In this context, FCA Bank was able to benefit from the resources made available by the ECB, getting financing at advantageous conditions through the monetary policy program TLTRO-III, also supported by the "ABACO" program made available by the Bank of Italy for the management of collateralized credit portfolios.

It should be remembered that in January, before the crisis, taking advantage of a

Medium Term Note" program, pricing a new fixed rate issue with a 0.250% coupon expiring in February 2023. This issue represented the best result in the history of the FCA Bank Group on the Eurobond market and raised orders for over 3 billion from more than 200 investors, confirming the trust of the financial community in FCA Bank Group.

In addition to relying on the greater availability of financing by the banking shareholder Crédit Agricole Consumer Finance - a consequence of the renewed joint venture agreements defined on the occasion of the latest extension until 2024 - the FCA Bank Group has also continued on the path of diversification of the funding sources: both billion euros), and through new issues of commercial paper based on the ECP issuance program, a money market instrument that allows the management of limited and temporary liquidity needs.

The combination of these operations has allowed, as regards liquidity, to face smoothly the current difficulty. Liquidity has not been the subject of concern.

BOARD OF DIRECTORS, BOARD OF STATUTORY AUDITORS AND EXTERNAL AUDITORS

Board of Directors Board of Statutory Auditors

Chairman Chairman Stéphane Priami1 Francesco Pisciotta

Managing Director and General Manager Statutory auditors Giacomo Carelli Giovanni Ossola Vittorio Sansonetti Directors 2 Richard Bouligny Alternate Statutory Auditors Paola De Vincentiis* Valter Cantino Andrea Faina Davide Chiesa Andrea Giorio* Olivier Guilhamon Davide Mele Richard Keith Palmer Valérie Wanquet

External Auditors

EY S.p.A.

* independent directors 1appointed on January 31, 2020 2appointed on June 26, 2020

PROFILE OF THE FCA BANK GROUP

Fiat Chrysler Automobiles (FCA) designs, engineers, manufactures and sells vehicles and related parts, services and production systems worldwide. The group operates over 100 manufacturing facilities and over 40 R&D centers; and it sells through dealers and distributors in more than 130 countries.

barth, Alfa Romeo, Chrysler, Dodge, Fiat, Fiat Professional, Jeep®, Lancia, Ram, Maserati. The g (automotive parts and service), Comau (production systems) and Teksid (iron and castings).

In addition, retail and dealer financing, leasing and rental services in support of the g arrangements with third-party financial institutions.

FCA is listed on the New York Stock Exchange under the symbo

In 2006, Crédit Agricole Consumer Finance and Fiat Auto set up an equally-owned joint venture called Fiat Group Automobiles Financial Services, which was eventually renamed FGA Capital in 2009. This partnership was subsequently extended to Jaguar Land Rover, Chrysler, Dodge and Jeep. With managed outs June 30, 2020, Crédit Agricole Consumer Finance is a leading player in the consumer credit market. It offers its customers and partners financing solutions that are flexible, responsible and tailored to their needs. With a presence in 17 countries in Europe, as well as in China and Morocco, Crédit Agricole Consumer Finance uses its know-how and expertise to ensure that the customer loyalty policies of its partners, be them vehicle manufacturers, distributors, dealers, banks or institutional organizations become a commercial success Customer satisfaction being at the heart of its strategy, Crédit Agricole Consumer Finance provides them with the means of making informed choices about their projects. The company innovates and invests in digital technologies to offer customers and partners the best solutions, thus developing a new lending experience with them.

GROUP STRUCTURE

Banking Group Other companies

100% FCA Capital France S.A. (FR) (4) Leasys S.p.A. (IT) 100% 99,99% FCA Leasing France SNC (FR) (5) Leasys S.p.A. (Belgian Branch)

Leasys S.p.A. (German Branch)

Leasys S.p.A. (Spanish Branch)

Leasys France S.A.S. (FR)

Leasys Nederland B.V. (NL) 100% Leasys Polska Sp.Zo.o. (PL) (7)

100% FCA Automotive Services UK Ltd (UK) Leasys UK Ltd (UK)

100% FCA Dealer Services UK Ltd (UK) Leasys Rent S.p.A. (IT)

Aixia Developpement S.A.S. (FR) (9) 100% Aixia Systemes S.A.S. (FR) 100% 100% FCA Capital Nederland B.V. (NL) Aixia Location S.A.S. (FR) 100% Rent All S.A.S. (FR) 99,99% FCA Capital Hellas S.A. (GR) (2)

FCA Insurance Hellas S.A. (GR) (3) 99,99% Clickar S.r.l. (IT)

50% FCA Bank GmbH (AT) (1) FCA Dealer Services Portugal S.A. (PT) 100%

100% FCA Leasing GmbH (AT) FCA Capital RE DAC (IE) 100%

FCA Bank GmbH (Hellenic Branch)

Note: 100% FCA Capital Suisse S.A. (CH) (1) FCA Bank GmbH (AT) - Fidis S.p.A. holds 25% while the remaining 25% is held by CA Consumer Finance S.A. 100% FCA Bank Deutschland GmbH (DE) (2) FCA Capital Hellas S.A. (GR) - 1 share is held by individual.

50% Ferrari Financial Services GmbH (DE) (6) (3) FCA Insurance Hellas S.A. (GR) - 1 share is held by individual.

Ferrari Financial Services GmbH (UK Branch) (4) FCA Capital France S.A. (FR) - 5 shares are held by individuals.

(5) FCA Leasing France SNC (FR) - Remaining shareholding interest is held by Leasys France S.A.S.. 100% FCA Capital Danmark A/S (DK) (6) Ferrari Financial Services GmbH (DE) - FCA Bank holds 50% + 1 share; remaining shareholding FCA Capital Danmark A/S (Finland Branch) interest is held by Ferrari Financial Services S.p.A..

FCA Capital Norge AS (NO) 100% (7) The company is still part of the Banking Group. (8) FCA Capital Sverige AB (SE) 100% An agreement to carry out the cross-border merger of FCA Group Bank Polska with and into FCA Bank S.p.A. was signed on December 19, 2019; the merger took effect on January 1, 2020.

(9) th 100% FCA Capital España EFC S.A. (ES) Effective 15 May 2020, Leasys S.p.A. holds 100% of share capital of Aixia Developpement S.A.S;. effective 17th July 2020 Aixia Developpement S.A.S. changed its name to Leasys Rent France S.A.S.. 100% FCA Dealer Services España S.A. (ES)

FCA Dealer Services España S.A. (Morocco Branch)

100% FCA Capital Portugal IFIC S.A. (PT)

FCA Bank S.p.A. (Belgian Branch)

FCA Bank S.p.A. (Irish Branch) Legal entity

(8) Branch

GEOGRAPHICAL FOOTPRINT

FCA Capital Danmark A/S (Finland Branch)

Ferrari Financial Services GmbH (UK Branch) FCA Capital Norge AS (NO)

FCA Automotive Services UK Ltd (UK)

FCA Dealer Services UK Ltd (UK) FCA Capital Sverige AB (SE)

Leasys UK Ltd (UK) FCA Capital Danmark A/S (DK) FCA Bank S.p.A. S.A. Oddzial w Polsce (Polska Branch) FCA Bank S.p.A. (Irish Branch) FCA Capital Nederland B.V. (NL) Leasys Polska Sp.Zo.o. (PL) FCA Capital RE DAC (IE) Leasys Nederland B.V. (NL)

FCA Bank S.p.A. (Belgian Branch)

Leasys S.p.A. (Belgian Branch)

FCA Capital France S.A. (FR) FCA Bank Deutschland GmbH (DE)

FCA Leasing France SNC (FR) Ferrari Financial Services GmbH (DE)

Leasys France S.A.S. (FR) Leasys S.p.A. (German Branch) FCA Capital Suisse S.A. (CH) Aixia Developpement S.A.S. (FR) * FCA Bank GmbH (AT)

FCA Leasing GmbH (AT) FCA Capital Portugal IFIC S.A. (PT)

FCA Dealer Services Portugal S.A. (PT) FCA Bank S.p.A. (IT)

Leasys S.p.A. (IT) FCA Capital España EFC S.A. (ES) Leasys Rent S.p.A. (IT) FCA Dealer Services España S.A. (ES) FCA Capital Hellas S.A. (GR) Clickar S.r.l. (IT) Leasys S.p.A. (Spanish Branch) FCA Insurance Hellas S.A. (GR)

FCA Bank GmbH (Hellenic Branch)

FCA Dealer Services España S.A. (Morocco Branch)

Legend:

Legal entity

Branch

* Aixia Developpement S.A.S. holds all the shares in the following companies:: • Aixia Systemes S.A.S. • Aixia Location S.A.S. • Rent All S.A.S.

RESULTS OF OPERATIONS

THE BUSINESS LINES

BANKING WHOLESALE FINANCING

The Wholesale Financing business line continued to be a strategic asset for FCA Bank in its role as captive bank of FCA, Ferrari, Maserati, JLR, Hymer and other significant manufacturers, especially in the first half of 2020 with the sudden Covid-19 emergency. In the face of this unexpected crisis, FCA Bank extended (for 60 days, on average) the payments coming due between March and June, providing dealers with liquidity relief, on . In preparing these actions, FCA Bank put in place risk mitigation mechanisms designed to identify possible counterparties that did not meet promptly the extended payments, thus avoiding, with a limited number of exceptions, the grant further extensions on already extended payments, to ensure adequate and sustainable cash inflows.

between April and June. Of the extended payments, 98% was met on the new date.

In terms of business performance, total loans and leases at the end of June 2020 amounted 0% from the comparable year-end figure. The decline was due mainly to attentive invoice management by manufacturers, to balance actual selling needs in relation to the pick-up of activities after the lockdown. The direct consequence was a negative growth of financed stock and the inevitable entory (over 180 days), which is expected to be worked off in the second half, in view of the many sales actions prepared in every European market. Despite the critical backdrop, the line of business still delivered positive results in terms of the comparable year-ago figure and, in any case, slightly better than expected. generates volumes that account for 35% of total loans and leases. These and the volumes generated in France and Germany represent slightly less than 70% of the outstanding portfolio.

BANKING RETAIL FINANCING

Retail Financing New Originations ( /mln)

11,588 11,659

10,495 10,660

6,253

3,769

31.12.2017

31.12.2018

31.12.2016 31.12.2019

30.06.2019 30.06.2020

New originations in 2020 by market Retail Financing ( /mln)

Italy 1,363 Germany 1,033 United Kingdom 374 France 265 Spain & Morocco 181 Belgium 124 Switzerland 122 Austria 89 Denmark & Sweden 70 The Netherlands 56 Poland 39 Portugal 31 Greece 22

Against this difficult context, the FCA Bank Group continues to expand its range of products for its customers, adding insurance products to its financial solutions to cater to end- e commercial activity and also in 2020 the search for an increasingly profitable integration between the various business lines was confirmed. To support sales FCA Bank has continued to improve a series of instruments aimed at increasing not only customer satisfaction, but also its loyalty. With particular reference to the insurance offer, FCA Bank has confirmed its willingness to collaborate with the leading companies in the market, in order to build a complete range of products, ranging from insurance coverage in case of events that personally involve the customer to those dedicated to the vehicle and its use. The financial and insurance offer converge in a single relationship with the customer, which simplifies and helps the management and payment of the vehicle and services connected to it.

MOBILITY - RENTAL

Regarding the Rental sector, the FCA Bank Group operates in 8 European countries (Italy, Germany, France, Spain, United Kingdom, Netherlands, Belgium and Poland) through the Leasys Group.

The Leasys Group confirms its ambition to act as a 360-degree mobility pioneer in Europe and, in May, it achieved another significant milestone with the acquisition of the AIXIA Group in France, in an effort to firm up its presence in that country and to expand its range of innovative products.

The number of Leasys Mobility Stores keeps growing. In Italy, in June, the Company installed its first EV charging stations, planning to install 1,200 EV charging stations throughout the country by the end of 2020. FCA Bank and Leasys confirmed their role as key players in the Italian revolution of electric and sustainable mobility, with plans involving significant investments in infrastructure, fleet and service.

Leasys CarCloud, the first mobility subscription service in Italy that allows customers to choose at any time the vehicle that best fits their needs throughout Italy, reached a total of 6,000 subscribers.

Thus, the FCA Bank Group has proved once again its ability to meet the different rental and mobility requirements of all sorts of customers, from large to small and medium companies, to self-employed professionals and individuals. Sales of off lease cars continue under the Clickar trademark, through the largest online platform in Italy devoted to sector operators and private individuals.

End of Period Rental Portfolio ( /bln)

3.6 3.5 3.3

2.8

2.2

1.7

31.12.2017

31.12.2018

31.12.2016 31.12.2019

30.06.2019 30.06.2020

INSURANCE AND SERVICES

Insurance Gross Written Premiums ( /mln)

532.9 523.7 524.7 496.8

280.9

169.9

31.12.2017

31.12.2018

31.12.2016 31.12.2019

30.06.2019 30.06.2020

Gross Written Premiums per Insurance 2020 ( /mln)

Other CPI Insurances 12% 14%

GAP 15%

Extended Warranty 5%

Motor Insurance 54%

Insurance contracts and intermediated services (thousand of unit)

912.6 905.9 882.3

666.7

483.3

267.3

31.12.2017

31.12.2018

31.12.2019

31.12.2016

30.06.2019 30.06.2020

FCA Bank provides a wide range of credit- and vehicle-protection insurance products and services in connection with financing contracts. Below, a list of the main insurance services provided in the various European markets is provided:  Credit Protection Insurance, which releases customers from the obligation to repay, in whole or in part, their debt in the presence of specific sudden and/or unexpected events;  GAP (Guaranteed Asset Protection) Insurance, which protects the value of the vehicle purchased, in case of theft or total loss, with the payment of the vehicle for the full value for a given number of years after purchase or a substantial payment, which may vary depending on the laws applicable in the country;  Glass/vehicle etching, an important anti-theft measure;  Third-party liability insurance, which may or may not be financed;  Theft and fire policy which, when it is financed throughout the term of the contract, covers theft, fire, robbery, natural events, socio-political events, vandalism and shattered glass;  Kasko & Collision. Kasko insurance covers damages in case of collision with another vehicle, fixed and mobile object collision, vehicle overturning and roadway departure. Collision insurance kicks in only in case of collision with another identified vehicle;

 Warranty with a range of solutions that cover customer expenses in case of vehicle breakdown.

All the financing and insurance solutions described are adapted to local standards, to meet customer requirements in the various European markets in which FCA Bank operates.

In the first half of 2020 the bank sold about 2 policies per financing contract.

DEVELOPMENTS IN THE AUTOMOTIVE MARKET AND BRANDS In the first half of 2020, the car market in Europe (European Union + EFTA) was strongly affected by the Covid-19 pandemic. Total car and commercial vehicles sold amounted to 5.2 million (down 40% compared to the first half of 2019), reflecting a decline in all the markets.

FCA registered 333 thousand vehicles, achieving 6.4% market share. Attention is called to the launch of the hybrid versions of the 500, Panda and Ypsilon, which represent the start of the process to electrify the Fiat and Lancia brands.

Against this backdrop, FCA Bank and Leasys supported the launches with the be-hybrid financing and long-term rental, which allow customers to adopt a tree to help the environment. This originated the FCA Bank forest, where thousands of trees planted on behalf of hybrid-car customers will contribute to the reduction of CO2, for a more informed and sustainable mobility.

Jaguar and Land Rover sold 25,000 vehicles in the first half of 2020. In particular, sales of the new Defender by Land Rover began in February.

Maserati delivered approximately 1.2 thousand vehicles.

ced.

6 million in volumes financed.

INTERIM REPORT ON OPERATIONS

SIGNIFICANT EVENTS

Covid-19 The Covid-19 pandemic is greatly undermining the world economy. In January and February, it was mainly China that bore the brunt of the virus, which eventually spread to the rest of the world through the trade routes. Between February and countries affected by the pandemic adopted containment measures based on social distancing, the lockdown of many businesses and the restriction of Europe was hit in the second half of February, first in Italy and then in the rest of the Continent. The significant uncertainty of future prospects had strong repercussions on financial markets, with tensions rippling through short-term interest rates, even though the money market is awash in liquidity. Governments stepped in to address the potential closing of businesses and the increase in unemployment, adopting immediate support measures, with a substantial impact on their budget, which included the postponement of tax payments, the provision of bank credit guarantees, subsidies to households and the expansion of welfare programs. The European Central bank went along by expanding its asset purchase programs and by loosening the conditions to access long-term refinancing. The measures adopted suggest a GDP recovery in the second half of 2020, with a jump in economic growth in 2021. However, there is uncertainty regarding a return of economic activities to pre-crisis levels. In this report a description is provided of the various customer support measures implemented by the FCA Bank Group and the impacts of Covid-19.

Italian Antitrust Authority AGCM On May 15, 2017, the Italian Anti-Trust Authority (Autorità Garante della Concorrenza e del Mercato - AGCM) announced the launch of an inquiry into nine car financing operators, or

101 of the Treaty on the Functioning of the European Union Anti-competitive agreements) in the automotive financing industry. FCA Bank S.p.A was one of the nine operators covered by the inquiry, which was intended to investigate alleged exchanges of information. AGCM communicated that the procedure, which was scheduled to end on July 31, 2018, was extended until December 31, 2018. The Decision was served to the company on January 9, 2019 indicating that the AGCM found the company, together with the other captives, had been exchanging commercially sensitive information via direct contacts, as well as through the local industry associations

Assofin and Assilea, with a view according to the AGCM to coordinating their commercial strategies with respect to car loans and leasing offerings, in breach of the TFEU. The AGCM imposed a total sanction of euro 678 million to the involved parties, and specifically fined the Company euro 178.9 million. decision are inaccurate. To that end, the Company thinks that the reasons to challenge that decision are pertinent and should be pursued. As such, the Company has against the decision and has requested a stay of payment of the fine. On April 4, 2019, the TAR of the Lazio Region, accepted the request for a suspension of the enforceability of the fine with order no. 3348 and set the hearing on the merits for February 26, 2020. The hearing did not take place on 26 February 2020 and was instead postponed until 21 October 2020.

FCA - PSA On October 31, 2019, FCA published a press release announcing that the Supervisory Board of Peugeot S.A. and the Board of Directors of FCA have each unanimously agreed to work towards a full combination of their respective businesses by way of a 50/50 merger. The merge is expected to be completed in the first quarter of 2021, subject to fulfilment of the closing conditions.

Leasys Acquisition of the AIXIA Group On 15 May 2020 Leasys completed its acquisition of the Aixia Group, a company engaged in short-term rental in France. This acquisition is part of a greater geographic growth strategy designed for Leasys to become a European leader in mobility services.

Merger of FCA-Group Bank Polska An agreement to carry out the cross-border merger of FCA Group Bank Polska with and into FCA Bank S.p.A. was signed on December 19, 2019 and recorded in the Turin Companies Register on December 24, 2019. In keeping with the agreement, the merger took effect for legal, tax and accounting purposes on January 1, 2020. As of this date FCA Bank S.p.A. operates in Poland through a branch, named . The merger turned out to be the best tool to face effectively the competition resulting from the expansion and globalization processes under way in the banking and financial system, on one side, and to look for additional qualitative growth opportunities that would allow the bank to fulfil the existing potential, on the other.

SECOND HALF OUTLOOK

In the first half of 2020, business activities were impacted by Covid-19, with total new production down 37%. Financial results, however, were still remarkable, with group net -earlier amount. The FCA Group will continue to cooperate with its manufacturing partners, supporting them in the launch of the new product slated for the second half of 2020 and in the consolidation of recently unveiled products. Given the current economic conditions, a return to a pre- highly desirable, albeit uncertain. the deterioration of the conditions in which it operates. In addition, the group is prepared to take all the opportunities that should materialize. The FCA Bank Group is the position to support the commercial activities of the automotive partners of Fiat Chrysler Automobiles, Jaguar Land Rover, Maserati, Ferrari, Aston Martin, Morgan Motor Company and Erwin Hymer Group, as well as of the other brands with which it cooperates, promoting financial, insurance, rental and mobility solutions that cater to the different requirements of the dealer network and end customers.

LEASYS A 360-DEGREE MOBILITY OPERATOR ALSO IN FRANCE Alberto Grippo Chief Executive Officer Leasys

establish a presence in 8 European markets. The objective is for the Company to have a

This expansion plan involves new mobility elements - such as short-term rental, started in 2018 with Leasys Rent in Italy as well as such trail-blazing mobility programs as car subscription and car sharing.

Regarding car subscription, CarCloud has already received over 6,000 subscription applications since inception at the end of 2019, a clear confirmation of the soundness of a strategy based on the validity of a new integrated and flexible mobility model.

As to car sharing, bearing in mind that Leasys has been the first rental operator to launch a private-to private car-sharing platform with Ugo, the recent launch of I-Link started a new chapter, as a vehicle can be shared by the members of a community created and -Link is the first personal car sharing program.

In this respect, in keeping with our ambition to be mobility pioneers, now more than ever we can stake our claim as the only true 360-degree mobility operator. This thanks also to the dedication and passion of its human capital (total headcount by year-end in the countries in which Leasys operates will be about 730, with an increase of 80 employees compared to December 31, 2019).

And this is not all. New, radical initiatives will complete this picture, starting with the launch of Leasys Rent France. Following Aixi -term car rental operator, Leasys continues to expand and to internationalize its model and, with it, the concept of Leasys Mobility Store, a retail outlet where customers can receive advice and design their own mobility solutions, from one hour to a lifetime.

Thus, Leasys now makes available its short-and medium-term rental services, as well as its Ugo car-sharing platform, and will soon provide car subscription mobility services, such as CarCloud, also in France. This will allow the Company to consolidate, at the international level, its integrated mobility offering through the development of the Leasys Mobility Store network in that country, in keeping with the model of the recently-opened flagship store in Torino Caselle.

improving the current rank in the top 10), in the wake of the success achieved in Italy, where the Company is market leader.

The solidification of the Le internationalization strategy, leads management to expect a significant increase in total

83% deriving from long-term rental, 9% from short-term rental and 8% from subscriptions and medium- 2020).

Leasys Rent France is only the first important step in the process to internationalize our integrated mobility model. Others will follow, with the ambition of making Leasys, one of the leading long-term rental operators in Europe, the standard against which all the other mobility operators are measured.

Welcome to Lotus and Groupe Pilote

Rolando Business Development

FCA Bank has built strong new partnerships over the last years with strategic players throughout Europe, a performance confirmed by two recent new pan-european deals signed: with Groupe Pilote, leader in camper van and caravan industry, and with Lotus, OEM leader in sports car industry. These new partnerships see us diversify and strengthen our presence in Europe.

The deal with Pilote, a major european player in the leisure vehicule industry, sees the existing cooperation in France through Viaxel, a subsidiary of the CACF Group, extended through FCA Bank to Germany, Sweden, Finland, the UK and Italy in 2020. The cooperation involves several brands, including Pilote, Bavaria, Le Voyageur, Mooveo and Frankia.

This deal represents an opportunity to further penetrate the leisure vehicles financing market across Europe. The leisure market has been strongly growing over the last 5 years. In Europe, the industry recorded the second best result in its history, with more than 210,000 new units sold in 2019 alone (up by 4% year-on-year).

In parallel to these new developments, FCA Bank continues its diversification and expansion with the British automotive company, Lotus. As a consequence FCA Bank become the exclusive retail finance provider for the UK and nine other European markets. The FCA Bank offer will provide customers with an attractive range of innovative finance products thanks to a multi-year pan-european partnership. The initiative replaces five existing suppliers with a single consolidated solution. It creates a one-stop shop across the region that will improve process efficiency and will increase sales. The agreement covers wholesale funding for retailers, delivering support and confidence to the Lotus sales network as well.

Lotus and Pilote are two new milestones, which exemplify and consolidate our ability in providing finance and mobility solutions to strategic and premium partners across Europe.

PRODUCT INNOVATION AND DIGITAL DISTRIBUTION: THE FUTURE FOR FCA BANK Giulio Viale FCA Bank Italia

In the past few years FCA Bank has increasingly shifted its focus to product and distribution channel innovation to achieve greater proximity to customers.

In a context where time is a valuable commodity, FCA Bank has adopted all the latest technologies available in the market, to make the experience associated with the purchase of its products simple and unique for its end customers as well as easier and faster for the dealers.

an insurance service, a personal loan or a banking product, the bank had made it its primary mission to constantly suggest new approaches to its offering.

In the first half of the year, a significant challenge was the launch of the Carta Club by FCA Bank, to the amazement of the captive market. This is a closed-circuit loyalty card - personalized with the design of an FCA brand and distributed through the dealer network and an innovative way to make monthly loan and lease payments - which doubles at no cost as a VISA Credit Card with a few clicks. The mechanism is simple, as all a customer has to do is to apply for it when the loan or lease contract is signed, to receive it directly home shortly thereafter. The Card qualifies the holder automatically for membership in the FCA Bank Club, which is the point of access to the privileges offered by the bank - such as the ability to purchase products sold under the FCA and Mopar brands, to access offers on other products of prestigious brands as well as to download discount vouchers dedicated to other FCA Bank products.

Purchases can be made thanks to the points accrued and accumulated with the monthly

products, which can take place directly from the MY FCA Bank Customer Area, also through an APP, are very easy.

The results achieved after a little more than a month from launch, with over 15,000 Carta Club applications and 10,000 cards issued, substantia between the mobility and banking sectors.

It is about the possibility to apply for a Personal Loan, or for an FCA Bank loan to purchase a used car, through a totally digital process, starting from the financial solution that best contract. The process is both convenient and immediate. Customers will be able to benefit from leading-edge technologies in the main three steps of the process: documentation upload with a character recognition system, video identification and electronic signing of contract. This

to support vehicle sales, also when such sales take place from a remote location and not

Another activity invo of an online platform for the sale of insurance policies related to both the vehicle that the customer bought, financed or rented and to cover the risks of daily life (e.g. health and accident, pet protection, domestic risks). FCA Bank chose Yolo as partner for its e- commerce platform. The platform is designed to be integrated with the different touchpoints of the FCA Group and will be integrated initially into the FCA Bank Customer Area as well as into the Leasys Rent and Mopar portals.

The distinctive process started by FCA Bank in the last few years is indicative of the rewards obtained with a strategy constantly devoted to the search of innovation. Such a strategy can be pursued only thanks to the constant involvement and participation of all the FCA Bank people that are engaged every day in the reinvention of financing and mobility, in terms of product and distribution channel development.

THE NEW NORMAL: ABILITY TO ADAPT AND ECO-SUSTAINABILITY Juan Manuel Pino Sales & Marketing

The past few months witnessed a significant change in our habits and pace of life. Priorities changed and so did family and work contexts, originating new needs, the most important of which is the search for flexibility.

The ability of a product or a service to adapt to sudden changes in context has become the most important market trend. From insurance to loans, to services on demand to - consumption experience.

In the main European countries FCA Bank rode this wave by offering its customers the option to start driving their new car now and to start paying for it in 2021 and, moreover, in Italy, in micro-

With Leasys, instead, we made existing mobility solutions, such as Be Free, more flexible, by postponing the first rental payments and allowing penalty-free contract terminations after only 18 months. In addition, we launched new products in line with customer needs, such as FlexRent in Italy, flexible like a short-term rental and affordable like a long-term rental. Customers can choose the length that best fits their needs (from one week to 3 months) and can renew it online by up to 6 months.

On the other hand, the quest for eco-sustainable solutions is increasingly clear. In the automotive sector this means electrified mobility. The first quarter of this year, characterized by a significant fall in sales due to the lockdown for the Covid-19 emergency, saw the growth in Europe acc of electric vehicles, which accounted for as much as 7.5% of new car registrations, clear and its implementation began with the launch of the Panda, 500 and Yipsilon models. The second half will witness the completion of the 2020 models with the addition of the new Jeep Renegade and Compass 4xe plug-in hybrid as well as the much-waited, totally electric, New Fiat 500.

FCA Bank and Leasys did not just sit back and watch. FCA Bank launched Be-Hybrid, a new product that allows customers who finance the purchase of a new hybrid FCA Group project launched in cooperation with Treedom. This is how the FCA Bank forest came into being. Thanks to the environment-friendly choice of buyers of hybrid cars, in support of a more informed and sustained mobility, such forest will make it possible to reduce CO2 emissions.

Still in connection with hybrid vehicles, Leasys launched 4ME, a flexible rental solution that - only the desired services online.

Lastly, a few words about the infrastructure. In June, Leasys inaugurated its first totally electrified Mobility Store in Torino Caselle airport, installing several EV fast charging stations. The objective is to electrify all the Mobility Stores in Italy by the end of 2020, with 1,200 charging stations.

In a constantly evolving world, where everything can change really fast, the ability to adapt is paramount and FCA Bank and Leasys have proved that they can respond promptly to ments.

THE AGE OF ELETRIC MOBILITY Andrea Pertica CEO Leasys Rent

Year 2020 marked the start of the age of electric mobility. True to their pioneering nature, FCA Bank and Leasys will contribute to disseminate the culture of the new mobility through a far-reaching EV charging infrastructure throughout Italy.

The first 22-kw charging stations have been installed in the Leasys Mobility Stores, with 8 of 1,200 EV charging stations by year-end, in all the main Italian cities, airports, ports and train stations.

Electrification of the over 300 Leasys Mobility Stores is the first step toward an increasingly sustainable mobility. Moreover, in the next few months the conventionally- fuelled rental fleet will transition to electric and hybrid vehicles, thanks also to the availability of the new FCA vehicles such as the electric Nuova Fiat 500 and the hybrid plug-in Jeep Renegade and Compass 4xe. The goal is to have by the end of 2021 a fleet with 60% of the vehicles either electric or hybrid, thus obtaining not only a substantial reduction of CO2 emissions but also greater freedom of movement for our users, as they will be able to access the restricted-traffic areas of large cities.

With this additional investment, the new Leasys Mobility Stores will be the place where the Living Mobility concept will increasingly come to life, in the shape of the integrated mobility

-term rentals, to car sharing, to great car bargain buys, assistance, financial and insurance services.

INFORMATION TECHNOLOGY Luca Pollano ICT, Digital & Data Governance

process firmed up, FCA Bank continued to pursue its strategy to develop new technological platforms, to utilize services and products in a manner increasingly intended to improve the associated experience and usability.

Activities continued in relation to the implementation of the new retail financing platform CRFS in Italy, which is expected to be released into production in March 2021, in pursuance of the strategy to upgrade operational and accounting systems based on the cluster approach.

To support the development of banking products, the Company completed the implementation of the new exclusive credit card, which is promoted as a loyalty tool that can double, depending on the customer, as a veritable means of payment.

The first half of 2020 witnessed the completion on a European scale of the new Customer Portal platform, including the development of the relevant App for Mobile/Smartphone, with the integration of important self-service functionalities, to allow customers to manage office.

As a support to an increasingly better User Experience, an integrated Full Remote Financing platform is being developed within the scope of the Digital Onboarding process already available in all the European markets. This platform will allow customers to manage from a remote location the signing of personal loan and car financing contracts, thanks to the implementation of microservices related to the upload and recognition of documents through neural networks (such as ID cards, driving licences) as well as Liveness Check and Face Matching functionalities, so as to handle a robust and certified recognition of te location.

In the first half of 2020, the RPA (Robotic Process Automation) project continued to automate manual processes, with the activation of 52 robots that covered processes at HQ and in the Business Unit Italy, thereby confirming the effectiveness of this type of automation.

To provide customers with an increasingly better and effective Customer Care service, in March 2020 an important initiative to develop a pan-European CRM platform was approved, also to standardize the internal processes in all the markets, by adopting the platform that is leader worldwide.

Regarding the foreign markets, also in this case the strategy to upgrade management and accounting systems continued, on the basis of the cluster approach, with special reference to the project to rebuild the information systems related to retail financing in Spain and Portugal, also based on the CRFS platform. The front-end systems were released in January 2020, while the back-end systems will be released in the second half of 2021.

As to digital initiatives, the first half of 2020 saw the continuation of the release in the various markets of the pan-European pre-scoring platform - which allows customers to perform an autonomous pre-assessment of their creditworthiness before going to the dealer as well as the start of the analysis to implement the new Finance Calculator for both retail and rental processes.

development of new solutions that are changing the IT layer intended to support in the best possible way its decision-making process (New Definition of Default, CFO Data Base, New Corporate Backbone), in keeping with new ECB rules and regulations (TLTRO-III Covid - 19). In additions, we are working to create a cheaper and more efficient centralized Treasury system.

In Leasys and Leasys Rent different platforms were implemented to create new commercial offerings (CAR CLOUD, DREAM GARAGE) as well as to centralize in a single platform of the UMOVE APP all the Long, Medium and Short Term Rental products, to provide potential and existing customers with a completer and more captivating customer experience and to have the Company transition to the digital age. Specifically, the ICT team worked to implement the new car sharing solution through the LEASYS GO! APP, which will go live with the new Electric 500.

RAPIDITY OF RESPONSE AND AGILITY IN AN EXTRAORDINARY SIX-MONTH PERIOD Andrea Barcio Human Resources

The strength shown by FCA Bank over the years not only for its significant business achievements but also for the professionalism of its Human Capital has allowed the group to manage in a balanced manner a one-of-a-kind six-month period.

Year 2020 kicked off a great deal of projects, confirming the nature of a constantly evolving Company, always seeking innovative solutions to support mobility, with the help of cutting-edge technologies that emphasize customer experience.

The pandemics suddenly posed new challenges to the Company, not only in business terms but also in terms of its ability to organize activities and time in a different way.

Despite the complexity of the context and the clear limited range of action, the FCA Bank Group never stopped supporting the Brands, the dealers and the customers, also in the worst days of the emergency. In the meantime, it prioritized the safety of its employees, ensuring that all could continue to work from a remote location with Company tools and llow the team to work rapidly and effectively also under these highly unusual circumstances.

Thanks to the professionalism and the tireless effort of Health Safety & Environment, information was provided constantly to all employees and precautionary measures were

To minimize contagion risk, most employees continued to work from home also after the lockdown phase.

Both emergency-related and ordinary activities to ensure business continuity were managed responsibly and with a sense of belonging. Considering that before the remarkable. Moreover, thanks to the sense of responsibility and the availability of the employees involved, projects continued to develop on schedule.

All the teams learned quickly in the field how to work with new communication, activity and objective monitoring procedures, proving their agility in working as virtual teams.

FCA Bank will continue to operate in a remote work mode not only to face the emergency phase but also to combine even more effectively the new demands for flexibility and productivity from the business and the surrounding world to be more competitive.

Once again the rapid reaction, the combination of skills, the leadership style and the energy events while pursuing business objectives.

RISK MANAGEMENT IN RESPONSE TO COVID Emanuela Demarchi Risk and Permanent Control

In the first half of 2020 we were forced to adopt emergency measures to work in full safety, ensuring business continuity, reducing the effects of the lockdown and preserving financial stability.

The highly critical moment, which hit us strongly not only from an operating and financial point of view, gave us the chance to test in actual reality the various stress scenarios prepared by Risk Management: Business Continuity Plan, Contingency Funding Plan, unprecedented event. FCA Bank was called upon, in very short order, to:

 test its ability to meet minimum capital and liquidity requirements also in the event that this extraordinary circumstance continues (ICAAP and ILAAP);

 rethink the monitoring tools that saw credit risk indicators used in combination with business continuity and human resources indicators and adapted to the different phases of the pandemic (lockdown, phase 2) and to the different counterparties (regulators, shareholders, internal committees, staff);

 adapt its information systems and customer care structures to the local legislative and non-legislative moratoriums that characterized the early months of the Covid- 19 outbreak and that saw the FCA Bank Group agree to postpone monthly

average 60-day extension for dealer invoices coming due and payable (Dealer Financing) in the March-June period. Overall, the support action involved financing

 prepare the restart with containment and distancing measures in the offices, with plans to support dealers and manufacturers, to boost production and sales, with rules for the provision of credit to the customer categories that suffered the most.

in line with budget, despite the Covid-19 emergency, witnessing the good credit quality and the traditional effectiveness of the FCA Bank Group in the entire underwriting monitoring - collection process.

While on the one hand the cost of risk showed a slight increase due to the lockdown of the court system and the sale of loans, on the other such increase was offset by a decrease in volumes, particularly those related to Dealer Financing (with a decline in loans in the amount of December 31, 2019). Lastly, in June the Company changed the parameters of the Forward Looking model, so a to incorporate in the estimated cost of risk the impact of Covid-19 in the scenarios considered.

In this great uncertainty looming over the future, prevention, ability to respond and a proactive approach to risk are paramount, putting into sharp relief the central role of Risk Management.

COMMERCIAL POLICIES

GROWTH IN 2020

In the first half of 2020 FCA Bank firmed up the cooperation with the new commercial partners. For Aston Martin and Morgan in particular, the first half of 2020 posted good results, with 10 million.

In the motorcycle sector, the excellent cooperation with Harley Davidson continues, with

In the period under review, cooperation arrangements were entered into with Lotus and Group Pilote, bringing to 19 the number of brands working with FCA Bank. Regarding the geographic scope, FCA Bank confirms and consolidates its presence in 17 European countries and in Morocco.

The first half of 2020, which was strongly affected by Covid-19, the automotive markets of the countries in which FCA Bank cooperates saw 5.2 million new car registrations. Against this background, financing provided for the benefit of the brands of the FCA

For the Jaguar and Land Rover brands, total financing amounted to 844 million.

Commercial penetration for the brands of the FCA Group (registrations of new FCA Group vehicles financed/total new FCA Group car registrations) was 44.6% in the first half of 2020. Penetration stood at 60.4% for the JLR brands (up 11.1 on the first half of 2019) and at 39.0% for Maserati. As such, total penetration related to all brands stood at by 45.7%.

Total penetration

48.1% 47.8%

47.1% 46.7%

45.7%

43.3%

31.12.2017

31.12.2018

31.12.2016 31.12.2019

30.06.2019 30.06.2020

FINANCIAL STRATEGY

The Treasury function manages the g the risk management policies set by the Board of Directors.

The g  maintain a stable and diversified funding source structure;

 manage liquidity risk;

 minimize the exposure to interest rate, currency and counterparty risks, within the scope of low and pre-set limits. In the first half of 2020, Treasury raised the resources necessary to fund the g marked by the falling volumes determined by Covid-19, at a competitive cost, thereby protecting the b

The most important activities carried out in the first half included:  a bond issue denominated in euros by FCA Bank S.p.A. (through its Irish branch) in Ja the best in the history of the FCA Bank Group in the Eurobond market in terms of yield);  the placement of Euro Commercial Paper issued by FCA Bank S.p.A. (through its Irish 234 million;  the extension of the revolving period of A-Best Fourteen S.r.l. securitization of retail credit portfolio in Italy used as collateral in TLTRO-III until December 2020;

 the progressive expansion of the A.BA.CO. program by the Bank of Italy, used as collateral in monetary policy operations and the simultaneous amortization of the Fast 3 S.r.l. securitization program, which is collateralized by a dealer financing portfolio;  retail deposits, taking total deposits at June 30,

THE STRUCTURE OF FUNDING SOURCES AND LIABILITIES The table below shows the structure of funding sources at June 30, 2020:

% on total % on total external Item liabilities and funding net equity sourcing Crédit Agricole Group 17% 14% Third Parties 17% 14% Securitisation 17% 14% Time Deposit 6% 5% MTN 35% 29% Central Bank 7% 6% Commercial papers 1% 1% Equity 12% Non-financial liabilities 5% Total 100% 100%

External funding sources (€/bln)

0.2 0.3 0.1 1.3 1.2 1.2 0.3 1.8 - 1.8 9.0 8.7 9.0 1.8 8.6 8.9 7.5 5.7 5.4 5.7 4.1 1.2 4.4 0.9 1.1 3.5 1.6 0.5 0.2 6.4 6.0 6.5 4.2 3.8 4.8 4.1 2.8 2.4 2.5 3.1 3.0

31.12.2016 31.12.2017 31.12.2018 31.12.2019 30.06.2019 30.06.2020

Crédit Agricole Group Third Parties Time Deposit Securitisation MTN Central Bank CPs

The chart shows how the strategy to diversify the funding sources firmed up over the years. In particular, the banking license obtained in 2015 made it possible to resort to the European Central Bank and to benefit from the further diversification resulting from the

All these actions enabled FCA Bank to continue to secure the liquidity necessary to fund the business and to strengthen its liability profile.

FINANCIAL RISK MANAGEMENT Interest-rate risk management policies, which are intended to protect net interest margin from the impact of changes in interest rates, provide for the maturities (interest reset dates) of liabilities to match the maturities of the asset portfolio. It is worthy of note that the g risk management policies allow the use of interest rate derivatives only for hedging purposes.

Maturity matching is achieved also through more liquid derivative instruments, such as interest rate swaps and forward rate agreements (the g

The strategy pursued during the first half of the year involved constant and full hedging of the risk in question, thereby offsetting the effect of interest rate and market volatility.

In terms of currency risk, the g currency positions. As such, non-euro portfolios are usually funded in the matching currencies; where this is not possible, risk is hedged through foreign exchange swaps (it is worthy of note that group risk management policies allow the use of foreign exchange transactions solely for hedging purposes). Counterparty risk exposure is minimized, according to the criteria set out by group risk management policies, by depositing excess liquidity with the central bank and performing day-to-day transactions with primary banks. Use of very-short-term investment instruments is limited to short-term deposits and repurchase agreements with European government securities as underlying. Regarding transactions in interest rate derivatives (carried out solely under ISDA standard agreements), counterparty risk is managed solely through the clearing mechanisms under EMIR.

 the Euro Medium Term Note (EMTN) program, with FCA Bank S.p.A. as issuer (through its Irish branch). At June 30, 2020 the program had an aggregate

outstanding. The notes and the pro long-

 stand-alone bonds denominated in Swiss francs issued by FCA Capital Suisse S.A. and guaranteed by FCA Bank S.p.A. At June 30, 2020 there were three bonds outstanding for a total amount of 400 million Swiss francs. These bonds -

 the Euro Commercial Paper program with FCA Bank S.p.A. as issuer (through its Irish branch). At June 30, 2020 the program had an aggregate maximum

FCA Bank programs and issuances

Settlement Amount Issuer Instrument ISIN Market Maturity Date Date (Mln) FCA Bank S.p.A. - Irish Public XS1383510259 EUR 23-Mar-16 23-Sep-20 500 Branch FCA Bank S.p.A. - Irish Public XS1435295925 EUR 21-Jun-16 21-Jan-21 500 Branch FCA Bank S.p.A. - Irish Public XS1497682036 GBP 29-Sep-16 29-Sep-21 400 Branch FCA Bank S.p.A. - Irish Public XS1598835822 EUR 13-Apr-17 15-Nov-21 800 Branch FCA Bank S.p.A. - Irish Public XS1697916358 EUR 12-Oct-17 12-Oct-20 800 Branch FCA Bank S.p.A. - Irish Public XS1753030490 EUR 17-Jan-18 17-Jun-21 850 Branch FCA Bank S.p.A. - Irish Public XS1881804006 EUR 21-Sep-18 21-Feb-22 600 Branch FCA Bank S.p.A. - Irish Public XS1954697923 EUR 21-Feb-19 21-Jun-22 650 Branch FCA Bank S.p.A. - Irish Private XS1983383545 EUR 16-Apr-19 16-Apr-21 200 Branch FCA Bank S.p.A. - Irish Public XS2001270995 EUR 24-May-19 24-Nov-22 800 Branch FCA Bank S.p.A. - Irish Private XS2016113420 EUR 20-Jun-19 20-Jul-21 200 Branch FCA Bank S.p.A. - Irish Public XS2051914963 EUR 13-Sep-19 13-Sep-24 850 Branch FCA Bank S.p.A. - Irish Private XS2072086049 EUR 24-Oct-19 24-Oct-22 200 Branch FCA Bank S.p.A. - Irish Private XS2109806369 EUR 29-Jan-20 28-Feb-23 850 Branch FCA Bank S.p.A. - Irish Private XS2028909898 EUR 12-Jul-19 10-Jul-20 100 Branch FCA Bank S.p.A. - Irish Private XS2184865504 EUR 3-Jun-20 3-Sep-20 9 Branch FCA Bank S.p.A. - Irish Private XS2184865090 EUR 3-Jun-20 3-Dec-20 10 Branch FCA Bank S.p.A. - Irish Private XS2189260370 EUR 8-Jun-20 8-Mar-21 10 Branch FCA Bank S.p.A. - Irish Private XS2189802874 EUR 10-Jun-20 10-Sep-20 130 Branch FCA Bank S.p.A. - Irish Private XS2193655946 EUR 17-Jun-20 17-Dec-20 75 Branch

FCA Capital Suisse SA Public CH0326371413 CHF 29-Jun-16 29-Nov-21 100 FCA Capital Suisse SA Public CH0370943620 CHF 25-Jul-17 24-Jul-20 175

FCA Capital Suisse SA Public CH0498400586 CHF 23-Oct-19 23-Oct-23 125

RATING On 2 April 2020, following a similar action on

On 7 April 2020, following the spread of Covid- -term rating outlook from stable to negative, leaving unchanged (stable) the rating on deposits.

The ratings assigned to FCA Bank at June 30, 2020 are as follows:

Long-term Short-term Long-term Company Outlook rating rating deposit rating

Baa1 Negative P-2 Baa1

Fitch BBB+ Negative F1 -

Standard & BBB Negative A2 - Poor's

TLTRO-III third series of targeted longer-term refinancing operations (TLTRO-III), which was made even more attractive in March and April 2020, represents an opportunity for banks and an effective tool in transmitting competitive interest rates from the financial sector to the private sector. TLTRO-III allows banks to obtain financing, for up to three years, at the interest rate on the deposit facility with the European Central Bank. In the first half of 2020, FCA Bank obtained financing under the TLTRO-III program for a total amount -

COST OF RISK AND CREDIT QUALITY

Cost of Risk

 core captive activities: support to the dealer network, loans and leases and mobility offerings for end customers;  conservative credit policies: from the acceptance phase based on ratings, scores, decision engines;  monitoring of credit performance, with prompt detection of performance deterioration situations through early warning indicators;  effective credit collection actions.

This makes it possible to maintain a low level of non-performing loans and customers/contracts showing a risk increase.

Also in the first half of 2020 cost of risk performed well, settling at 0.30%, which was in line with budget, despite the Covid-19 emergency and the ensuing lockdown period. The paragraph below will describe the impacts of Covid-19.

Non performing loans

1.58%

1.43%

1.24% 1.26% 1.25%

1.21%

31.12.2017

31.12.2018

31.12.2016 31.12.2019

30.06.2019 30.06.2020

The level of NPL is confirmed at low levels 1.25%.

Following the Covid-19 emergency, FCA Bank provided support to its customers in keeping with guidance from local regulators and EBA guidelines. Below, details are provided of the most significant measures in both the Retail and Wholesale Financing lines of business.

Retail Financing

 In light of the over 170,000 relief requests received from customers in March, April and May, the bank granted, on average, a three-month moratorium. This involved monthly instalments in postponed after the maturity date of the loan or spread over the remaining life of the

loan (depending on the practices or regulations prevailing in the European countries of reference). The moratoriums involved a cost and concerned mainly customers who were current on their payments, thus preserving the value of the loans, without any forbearance classification;

 the actions were conducted in accordance with any local legislative or non-legislative moratorium, which prevailed over the b

 actions were taken to strengthen the customer care and collection departments, as they were affected the most by the relief requests; these actions were helped by the temporary suspension of credit acceptance activities, which made it possible to redeploy resources where they were needed the most;

 in the meantime specific monitoring tools were established to review the situation of the contracts involved in the moratorium; this monitoring activity will take on a growing importance, especially starting from the third quarter of 2020, when it will be necessary to verify the resumption of payments under these contracts.

The cost of risk of the Retail Financing line of business was -53 basis points of the average outstanding, reflecting a deterioration compared to the first half of 2019 (-31 basis points), of which - the update of the forward looking model to calculate loan and lease loss provisions. In fact, the Company updated the parameters of the forward looking model so that the estimates of the cost of risk could reflect the impacts of Covid-19 on the medium- and long-term scenarios.

The Group Compliance and Risk Management Functions activated a dedicated monitoring system and periodic meetings with the group companies, to ensure that local moratoriums were applied in keeping with local rules and regulations. In additions, guidance and specific support were provided to all the jurisdictions on matters closely related to the Covid-19 emergency. Lastly, starting from July, credit guidelines were issued to strengthen responsible credit measures in credit provision.

Wholesale Financing

 The actions taken to support corporate customers (mainly the dealer network), which were adversely impacted by the long lockdown, involved an average 60-day extension on the invoices due in March- on involved). The moratoriums involved a cost and concerned mainly customers who were current on their payments, thus preserving the value of the loans, without any forbearance classification;

 the actions were conducted in accordance with any local legislative or non- legislative moratorium, which prevailed over the b

 further actions were taken by the automotive manufacturers at the end of the lockdown, with the gradual reopening of dealers, with the objective of reducing unsold vehicle inventories. The good performance in June bears witness to the effectiveness of these actions.

The cost of risk of the Wholesale Financing line of business is positive (gain) and settled at +34 basis points of the average outstanding, reflecting an improvement on the comparable year-earlier figure (-13 basis points). This improvement was mainly due to the substantial drop in total outstanding (- the good repayment performance by dealers. In addition, as with the Retail Financing line of business, the forward looking scenarios were updated (given the short-term nature of the product, scenarios are short term as well, with their focus on the second half), which st of risk.

Lastly, specific monitoring tools were put in place to check the regularity of payments, with emphasis on the extended invoices.

In the credit acceptance phase, scorecards are one of the main decision-making drivers used by the FCA Bank Group

Scorecards are statistical models that identify the probability of risk associated with the customer/application and the ensuing classification in the rejection or acceptance area through the application and an approved cut-off value. The use of statistical models ensure an objective, transparent, structured and consistent assessment of all the information related to the customer and the financing required. scorecards and the application of the rules governing credit approval (such as control over external negative events, status of internal risks, etc.). In the cases where the input of a credit analyst is required, the final credit decision can be confirmed or revised, where necessary. Currently, the FCA Bank Group uses 32 scorecards based on country, type of customer and, where possible, type of product.

In September 2019, the Board of Directors approved the insourcing of the activities to develop scoring models. These activities have been the responsibility of the central credit function since January 2020, with the objective of creating a competence centre for the development of all the scorecards used in the credit process (acceptance, anti-frauds and collection). Consequently, starting from this year - based on the organizational model adopted by FCA Bank, designed to improve the level of the service provided by the Parent Company to the group companies the central credit function is responsible, on behalf of all the market, for executing, not just supervising, the statistical development of the scorecards used in the credit process, while maintaining responsibility for:  monitoring the scorecards and recommending corrective actions in the presence of a deteriorated predictive capacity;  the preparation of group procedures and handbooks in relation to scores.

From a quantitative point of view, during the first half of 2020 the Retail business line saw the approval of a new scorecard for private customers in Greece while a new scorecard is being approved for private and business customers in Austria. The Rental business line, for its part, witnessed the approval and implementation of a new scorecard for companies in Italy while a new scorecard is being approved, still in Italy, for private and self-employed customers.

In addition, in the first half of 2020 scorecards were monitored with the new tool developed by FCA Bank to ensure an automated and consequently faster process, making it possible to implement even more rapidly any corrective action necessary.

The evaluation of corporate customers is based on a comprehensive combined use of two systems, developed in cooperation with the pertinent technical staff of the two shareholders.

The second, which is called power and probability of default. It is noted that the operational mechanisms for the use of systems to rate corporate counterparties and the development of scorecards, as well as the setting of the cut-off for retail counterparties, are matters that fall within the purview of the Board of Directors, which sets the specific guidelines to be applied by management in day-to-day operations.

Credit quality

(Item 40b FINANCIAL ASSETS MEASURED AT AMORTIZED COST LOANS AND RECEIVABLES TO CUSTOMERS) )

30/06/2020 31/12/2019

Allowance Allowanc DESCRIPTION Gross Gross Exposure for loan and Net exposure e for loan Net exposure Exposure lease and lease

Bad exposures 124,611 (89,288) 35,322 (84,544) 125,027 40,483

Unlikely to pay 71,673 (30,343) 41,330 (35,417) 102,832 67,415 Non Performing 77,891 (28,298) 49,593 (26,854) Past due 71,534 44,680 Non-performing (146, 815 274,175 (147,929) 126,246 loans 299,393 ) 152,578 (123,990 Performing loans 21,693,396 (120,472) 21,572,923 23,876,501 ) 23.752,511 (270,80 Total 21,967,570 (268,401) 21,699,169 23,905,089 24,175,894 5)

WEIGHT AND LOAN LOSS COVERAGE RATIO

30/06/2020 31/12/2019

DESCRIPTION Gross Net Gross Net Coverage Coverage exposure exposure exposure exposure ratio ratio weight weight weight weight

Bad exposures 0.57% 0.16% 71.65% 0.52% 0.17% 67.62%

Unlikely to pay 0.33% 0.19% 42.34% 0.43% 0.28% 34.44% Non Performing 0.35% 0.23% 36.33% 0.30% 0.19% 37.54% Past due Non-performing 1.25% 0.58% 53.95% 1.24% 0.64% 49.03% loans Performing loans 98.75% 99.42% 0.56% 98.76% 99.36% 0.52% Total 100.00% 100.00% 1.22% 100.00% 100.00% 1.12%

RESIDUAL VALUES

Residual value is the value of the vehicle when the related loan or lease contract expires. The bank is exposed to residual value risks in connection with loan and lease contracts with customers that can return the vehicle at the end of such contracts. Trends in the used vehicle market may entail a risk for the holder of the residual value. This risk is basically borne by the dealers throughout Europe, with the exception of the UK market, where the risk is managed, regularly monitored, mitigated with specific procedures and covered through specific provisions by the bank. FCA Bank has long adopted group guidelines and processes to manage and monitor residual risk on an ongoing basis.

euro/mln 2018 2019 30/06/2020

Consumer loans and leases: - Residual Risk borne by FCA Bank Group 912 1,102 1,037 of which UK market 700 687 568

Provisions for residual value 32

Regarding long-term rentals, residual risk on rented vehicles is generally borne by the rental car company, save for specific arrangements with third parties. In this case, residual risk is represented by the difference between the market value of the vehicle at the end of the contract and the carrying amount of the vehicle. Leasys and its subsidiaries, which are not part of the banking group, and FCA Capital Danmark A/S are the group companies operating in the long-term rental business.

euro/mln 2018 2019 30/06/2020

Long-Term Rental: - Residual Risk borne by FCA Bank Group 1,230 1,497 1,563

Provisions for residual value 24

Regarding the specific context created by Covid-19, in the period under review the Company reinforced residual risk management, monitoring closely used market prices and the seniority of the vehicles on sale. The model to calculate Residual Value is updated every quarter, so as to determine more accurately the amount of provisions. To date, there are no criticalities on residual values.

RESULTS OF OPERATIONS

30/06/2020 30/06/2019

Net banking income and rental margin 487 510 Net operating expenses (133) (145) Cost of risk (40) (33) Operating income 314 332 Other income / (expense) (13) (18) Profit before tax 301 314 Net income 225 238 OUTSTANDING End of period 25,578 27,676 Average 26,262 26,122 Ratio Net banking income and Rental margin (on Average Outstanding) 3.7% 3.9% Cost/Income ratio 27.4% 28.4% Cost of risk (on Average Outstanding) 0.30% 0.26% CET1 15.34%* 13.22% Total Capital ratio (TCR) 17.10%* 14.79% Leverage ratio 10.68% * 10.74%

(*) Estimated Figure

30/06/2020 31/12/2019 Cash and cash balances 620 585 Financial assets designated at fair value with effects on comprehensive income 10 10 Financial assets valued at amortized costs: 23,984 25,903 a) Loans and receivables with banks 2,285 1,997 b) Loans and receivables with customers 21,699 23,905 Hedging derivatives 35 37 Changes in fair value of portfolio hedge items 73 48 Insurance reserves attributable to reinsures 14 13 Property, plant and equipment 3,319 3,197 Intangible assets 272 263 Tax assets 358 300 Other assets 1,292 1,350 Total assets 29,974 31,705 Total liabilities 26,599 28,534 Net equity 3,375 3,171

In the first half of 2020, owing to the substantial contraction of the activities of the manufacturing partners and their dealers caused by Covid-19, financed volumes decreased with respect to the previous period, with negative effects for the results of the FCA Bank Group.

At June 30, 2020, the total outstanding portfolio amounted t -7.1% compared to the amount as of December 31, 2019) while net pr (-5.5% compared to the first half of 2019). The decline of the outstanding portfolio was more significant for the Wholesale Financing line of business (-20.4% compared to the amount as of December 31, 2019) also due to the effects of the new marketing strategies of the manufacturing partners, designed to improve t

The Retail Financing line of business showed a lower drop of the outstanding portfolio (- 3.8% compared to the amount as of December 31, 2019), despite the effects of the Covid- 19 crisis, due to the excellent cooperation with our commercial partners. On the other hand, the Rental business saw an increase of the total outstanding, compared to the amount as of December 31, process involving the rental and mobility services.

Net banking income and rental margin for the period ended June 30, 2020 decreased with respect to the comparable year-earlier amount, setting at 3.7% of the average outstanding portfolio, mainly due to the decline in volumes of insurance products and narrower margins in Wholesale Financing.

Despite the hardship of the Covid-19 emergency, the group was able to implement successful actions in the period under review to curb operating costs, which decreased to 27.4% of net banking income and rental margin.

Cost of risk was affected by the Covid-19 emergency and by the moratoriums granted in the various European jurisdictions.

Cost of risk was higher than the comparable year-earlier metric, as it accounted for 0.30% of the average outstanding portfolio, as it discounts worsening macroeconomic scenarios.

Operating Income and Net profit ( /mln)

666.0 633.0

534.1

467.1 432.0

382.5 388.4

331.5 311.6 313.9

238.5

225.3

31.12.2017

31.12.2018

31.12.2019 31.12.2016

30.06.2019 30.06.2020

Operating Income Net Profit

-tax profit in 2019, despite the difficult conditions created by the Covid-19 emergency.

the Bank of Italy.

Net profit for the -5.5%) with the results obtained in the same period of 2019.

EQUITY AND CAPITAL RATIO

Own Funds and ratios 30/06/2020 (*) 31/12/2019 (Euro/000)

Common Equity Tier 1 - CET1 2,993,186 3,001,472

Additional Tier 1 - AT1 5,599 5,584

Tier 1 - T1 2,998,785 3,007,056

Tier 2 - T2 337,468 337,046

Total Capital 3,336,253 3,344,102

Risk-weighted assets (RWA) 19,508,513 21,142,442

REGULATORY RATIOS 0 CET 1 15.34% 14.20%

Total Capital ratio (TCR) 17.10% 15.82%

LCR 228% 282%

NSFR 116% 106%

OTHER RATIOS Leverage Ratio 10.68% 10.62%

RONE (Net Profit/Average Normative Equity) 24.31% 23.25%

(*) Estimated figures

At June 30, 2020, the Total Capital Ratio was 17.10%, reflecting an improvement over the comparable metric at the end of 2019. CET 1 was 15.34%, while RONE (Return on Normative Equity) calculated considering the average Normative Equity and a 9.5% capital requirement for RWA, stood at 24.31%.

FCA Bank S.p.A., FCA Bank GmbH e FCA Capital Portugal IFIC S.A. are considered, for prudential purposes, within the prudential scope of consolidation of " Crédit Agricole s.a ", and consequently "significant" banking entities.

RECONCILIATION BETWEEN RECLASSIFIED AND REPORTED FINANCIAL STATEMENT FIGURES

Reconciliation between reported income statement and reclassified income statement

30/06/2020 30/06/2019

10. Interest income and similar revenue 441 466

20. Interest expenses and similar charges (116) (117)

40. Fee and commission income 53 73

50. Fee and commision expenses (10) (18)

80. Net income financial assets and liabilities held for trading 1 1

90. Fair value adjustments in hedge accounting (4) (2)

160. Net premium earned 1 0

170. Net other operating income/ charges from insurance activities (0) 1

200. Net provision for risks and charges (5) (3)

210. Depreciation/Impairment on tangilble assets (*) (243) (203)

230. Other operating income/charges 369 311 Net Banking Income (**) 487 510

40. Fee and commission income 9 0

190. Administrative costs (123) (130)

200. Net provision for risks and charges (1) (0)

220. Amortisation/Impairment on intangilble assets (8) (7)

210. Depreciation/Impairment on tangilble assets (8) (6)

230. Other operating income/charges (3) (1) Net operating expenses (133) (145)

50. Fee and commision expenses (5) (6)

130. Impairment/reinstatement of value of loans a) financial assets at amortized cost (28) (23)

230. Other operating income/charges (7) (4) Cost of risk (40) (33)

200. Net provision for risks and charges 1 (6)

190. Administrative costs (13) (11)

230. Other operating income/charges (1) (1) Other income/expenses (13) (18)

300. Tax expense related to profit or loss from continuing operations (75) (75) Income taxes (75) (75)

Net profit 225 238

(*)The item includes the depreciation related to the Rental business. (**) Of which insurance

Reconciliation between outstanding and loans and receivables with customers

30/06/2020

Outstanding 25,578

90. Property, plant and equipment (*) (3,165)

130. Other assets (**) (744)

10b. Deposits from customers 6

80. Other liabilities 151

40b. Loans and receivables with customers not included in the outstanding 142 40b. Loans and receivables with customers 21,968

Allowance for loans Management data 307

90. Property, plant and equipment (*) -

130. Other assets (**) (39)

10b. Deposits from customers -

80. Other liabilities -

40b. Loans and receivables with customers not included in the outstanding - Allowance for loans with customers Item 40 b) 268

(*)The item includes assets related to the rental business

(**)The item includes the consignment for euro 118 million and receivables from customers relating to the rental business for euro 626 million

RECONCILIATION BETWEEN PARENT COMPANY AND CONSOLIDATED EQUITY

Of which, profit Equity for the year Equity and profit for the period of FCA Bank S.p.A. 1,998,632 116,653

Equity and profit of subsidiaries less non-controlling interests 2,328,251 137,962

Consolidation adjustments: (999,924) (32,740)

Elimination of carrying amount of consolidated companies (1,015,137) -

Intercompany dividends - (30,381)

Other consolidation adjustments 12,545 (4,006)

3,316,959 221,875

58,363 3,433 Equity and profit attributable to non-controlling interests Consolidated equity and net profit 3,375,321 225,308

ORGANIZATION AND HUMAN RESOURCES

As at June 30, 2020, the FCA Bank Group had a total headcount of 2,348, an increase of 68 employees over the end of the previous year.

This increase was due mainly to the acquisition of the Aixia Group in France.

Breakdown of the gro

An analysis of the data shows that the two Italian companies account for 52.86% of total employees. At the end of June 2020 female employees represented 49.2% of the workforce, the average age of the group was 45.44 (44.71 for men and 46.33 for women), while average company seniority was 23.71 (20.19 years for men and 26.62 years for women). At the same date 6.1% of the workforce (144 employees, of whom 136 women) worked part-time.

Company seniority by gender

Average age by gender

Hierarchical level

23.1% of all employees had upper management responsibilities.

HUMAN RESOURCE MANAGEMENT

Regarding the management of human resources, attention is called to the following activities carried out during the period under review.

Organizational development

During the first half of 2020, activities continued to strengthen the central monitoring of several human resource management processes and governance mechanisms. Attention was paid in particular to:

 the review of FCA Bank S.p.A. -level organizational structure, with the merger of the European Markets and Business Development departments;

 the start of the activities for the cross-border merger of FCA Capital Portugal with and into FCA Bank S.p.A.;

 acquisition of the AIXIA Group in France.

From the point of view of Industrial Relations, the period under review saw the continuing application of the company-specific collective labour agreement (CCSL - Contratto Collettivo Specifico di Lavoro) for the 2019 2022 period, which confirmed the

participation of employees in a profit sharing scheme in accordance with an efficiency- based metric measured on an annual basis.

Covid-19

To address the effects of the Covid-19 emergency, the FCA Bank Group acted fast to protect the health of its employees and to ensure that business would continue to be run smoothly.

At group level, Health Safety & Environment and Human Resources implemented at once specific measures to protect the health of employees, with the systematic monitoring of all the cases of employees affected by the virus or that had been in contact with persons that tested positive until the conclusion of each single case.

Starting in March, to limit the number of employees at the office, especially in the critical phase of the outbreak, all the group companies implemented increasingly a remote work system, which covered 100% of all employee in Italy by the end of the month. The Human Resources department, for its part, sent specific memos to employees on the specific health and safety measures at work applicable in the case of remote work. The rest of the EMEA countries implemented remote work systems in keeping with the lockdown plans imposed from time to time by the different governments.

The return to work phase, also planned on the basis of the reopening plans defined by the different governments, included the safety measures adopted by the group companies, as illustrated below:

 sanification of all work environments with specific products before the reopening;

 inspection and, where necessary, rearrangement of the layout to ensure social distancing, with the affixation of bills in every office and common area with dos

 publication of the precautions to be adopted by the single individuals (company int

 online training session with specific information on the measures implemented and obligation to view it before returning to the office;

 provision of personal protective equipment (PPE) that all the employees in attendance are required to use, in accordance with local rules and regulations; in Italy; mask, kit in every office to allow employees to clean their own workstations and desks (gloves, liquids and paper wipers) as well as temperature checks by security before entering the office.

Training

Also in the first half of 2020, group personnel training expenses were allocated adequately, while still paying attention to costs. Following the Covid-19 emergency, starting from March, training sessions were held only online.

Performance Leadership Management

Through the PLM process, the FCA Bank Group guarantees the engagement of individual behaviors in view of the annual and long-term objectives of the company and the Shareholders. The idea is to establish a transparent and bilateral communication process with all they are working to achieve effectively the agreed-upon objectives and, lastly, to provide them adequate support for their improvement and growth. objectives and results achieved, to make employees responsible by involving them directly in their development.

In 2020, the CEO & General Managers and all the Material Risk Takers took part in the PLM, together with the rest of the staff, to engage each employee in reaching the strategic objectives.

Innovaction

Following completion in 2019 of the Strategic Thinking Path program, which was started in 2017, FCA Bank launched an additional corporate initiative called InnovAction, to develop feasible and innovative business solutions that might enable it to be competitive in the market, meeting, and where possible anticipating, customer needs. With man specific projects with which to work. Participants are a heterogeneous and international group, made up of 50 colleagues coming from a variety of markets and with different corporate seniorities. The 8 teams identified worked on a single project, with support from an internal tutor in terms of expertise, know-how and leadership.

The program consists of three main phases, a kick-off workshop held in June, involving a one-day-and-a-half gathering where participants and tutors, with help from external facilitators and innovation experts, worked on the creation of the teams and the sharing of methods and tools to be used for the development of projects; six months of project

work, during which participants worked from a remote location; and a final day to be held in early 2020, where the teams will present their projects to the Leadership Team.

To overcome the geographical distance and the functional and hierarchical differences within the organization, virtual and team coaching sessions were held to enhance agile working and virtual remote collaboration capabilities.

After the one held in February, all workshops have been postponed until the end of the Covid-19 emergency.

Progetto Cross Path

- - launched in 2016 - ended in the first half; consistently with the objectives of the program, the participants were assigned to the expected arrival positions.

The first half of 2020 witnessed the candidate selection phase for the second edition of the Cross-Path career program, which has been temporarily discontinued due to the Covid-19 emergency.

The key features of the program are:

 people involved: international mind-set, dynamic and open to the change that is typical in our business;

 Credit, Finance e Sales & Marketing);

 International exposure: international assignments in the markets in which the group operates;

 training: during the program the people receive training not only on compliance and risk but also on knowledge of company activities and skill development. During the process, special attention is paid to management training;

 management team, who follows them for the entire work period and guides them on their growth path;

 Work on projects: on themes of strategic importance for the company.

Health and safety at work

All the group companies follow strictly the laws on safety at work. Specifically, in the current phase characterized by the Covid-19 outbreak, a large number of measures was -

 risk assessment;  identification and preparation of prevention and protection measures;  definition of an action plan in connection with a program intended to improve safety levels over time;  implementation of the actions planned in connection with the program;  definition of worker information and training plans;  residual risk management.

FCA Bank S.p.A. (in its capacity as Employer) with the cooperation of the Head of Prevention and Protection Service and the Competent Physicians, after consultation with Worker Representatives on Safety, prepares and updates the risk assessment document (to which the risk from Covid-19 was added in the first half of 2020), which contains:

 the report on the assessment of all risks for health and safety at work, specifying the criteria adopted or such assessment;  a description of the prevention and protection measures adopted following the assessment;  the program of measures deemed appropriate to ensure the improvement of security levels over time.

The assessment and the relevant document are updated whenever there are such significant changes in the corporate organization as to affect the exposure of workers to risk and following the two-year assessment of work-related stress risk.

In the period under review, the group witnessed 3 injuries (1 man and 2 women), all on the way to work in Italy and in the markets where the group operates.

In the work activities performed within the group (VDT workers), there are no individual protection devices (IPD) and no collective protection devices (CPD).

None of the injuries reported had relevant consequences for the life and health of employees.

INFORMATION TECHNOLOGY

In line with the digitalization process implemented by the group, the Information and Communication Technology department continued to pursue its actions to upgrade the information systems to achieve dematerialization in the Consumer Financing sale process.

In addition, in the first half of 2020 the following projects were managed:

 New Corporate Backbone, the new pan-European tool that allows Credit Dossiers to be managed through a workflow containing the approval process and automatic calculation with the new delegated powers;  New Definition of Default, which implies a new calculation of this corporate indicator;  TLTRO Covid-19 returns, which implies the adaptation of the TLTRO-III return to the new specific rules and regulations, and development of the returns required by the ECB following the pandemics.

In parallel, at the start of 2020, the Company invested in projects designed to enhance its profitability:  Support to the activities of the Treasury department, with the start of the ABACO (Attivi Bancari Collateralizzati Collateralized Banking Assets) project, to handle

collateral;  The Leasing securitization process was completed, to allow leasing contracts to be securitized in keeping with the law, with just the securitization of the credit arising from the asset component and the exclusion of all the other components;  The new Financial Calculator 3.0 project was started, thus creating a new company tool designed to allow the public to calculate immediately and more effectively the cost of a Long Term Rental and to model the product starting from a specific monthly payment. The new tool available on all digital front-ends will be linked to the corporate back-ends in real time;  The Pre-Scoring Project entered production at the start of 2020 in Italy as well; its combination with the Financial Calculator 3.0, it will allow the Company to start its journey toward e-Commerce;  The functionalities of the Customer Area improved, for a better User Experience, by activating the integration of a single digital identity (Single Sign On) with Conto Deposito.

Moreover, FCA Bank began the process to redefine all the central Treasury systems to

began in relation to the CFO Database project, to create a database containing accounting data with a high level of detail in relation to all the legal entities and subsidiaries of FCA Bank and Leasys, which will make it possible to automate the feeding of the Consolidated Financial Statements and Supervision software application and to upload the data of the planning model.

The Company redefined also the new BI Roadmap, which will witness the replacement of its Data Warehouse system with a more innovative Data Lake system, capable of hosting new communication tools developed now and in the near future. The new tool will be able to host new objects and will make it possible to perform detailed analyses to design and develop the new Customer Centricity model.

To that end, the Company reconsidered the Customer Care tool, selecting in a constantly changing market a better solution, with the resulting variation in Company requirements. Thus, starting from the end of 2020, the Markets of FCA Bank and Leasys will see the implementation of the new Salesforce system, starting from the countries that do not have an integrated Customer Care tool yet.

Moreover, the Markets worked closely with the central activities for the pan-European Pre- Scoring, Customer Portal and Residual Value projects. The Residual Value project was completed in January 2020 and will constitute a common platform to calculate the residual value of corporate assets by basing the recalculation on a single provider.

In the Foreign Markets, the cluster-based approach to upgrade management and accounting systems continued, as did the Rollouts started in 2015 to create the IT platforms to cover the Retail Financing and Long Term Rental lines of business. In 2020 releases are planned in Denmark, Portugal, Poland, France, Spain.

In 2020 the process began to adapt the systems of Leasys Rent, the short-term rental company acquired by Leasys to meet new market needs, to stay ahead of the competition and to address the preferences of Web customers, with the creation of new and innovative products such as Car Cloud and Dream Garage, which are based on the subscription model.

The new Leasys APP (UMOVE) was implemented, introducing all the Leasys and Leasys Rent products in a single platform to potential and existing customers. Work continues to be performed in relation to Leasys GO! Car Sharing, a new platform owned by Leasys where the shared fleet management system will be implemented, with such platform to be inaugurated with the commercial launch of the new electric 500.

Also the RPA (Robotic Process Automation) project, for the automation of repetitive and low-value-added processes have been completed within FCA bank and are being completed in Leasys. In 2019, the RPA project activated progressively 40 robots, to cover HQ, BU Italy and Leasys processes, thus confirming the strategic automation plan for the

repetitive activities of m personnel expenses and the reallocation of Business resources to higher-value-added activities. In 2020, the additional 50 robots of the last stage of the RPA project will be released.

Developments were managed in connection with the creation of the applications for the online auction sales of used cars for private individuals and brokers, in support of Clickar, a new company.

ICT also released for JLR the new pan-European Customer Portal and Pre-Scoring System,

INTERNAL CONTROL SYSTEMS

To ensure sound and prudent management, the FCA Bank Group combines business profitability with informed risk-taking, adopting a fair conduct in operational activities. As such, the group has established an internal control system designed to detect, measure and constantly monitor the risks associated with its activity, involving directors and statutory auditors, control committees and functions, the Supervisory Board, the independent audit firm, senior management and the staff as a whole. Responsibility for the

Compliance & Supervisory Relations. These functions which are independent of one another in organizational terms operate across the Company and the group and liaise with the corresponding functions of the subsidiaries. In particular, Compliance & Supervisory Relations and Risk & Permanent Control report to the CEO and General Manager while Internal Audit reports to the Board of Directors. From an operational point of view there are three types of control in place:

 First-level controls, which are carried out by the operational departments or are incorporated into the IT procedures to ensure the proper performance of day-to- day operations and the single transactions;  Second-level controls, which are designed to contribute to the definition of risk measurement methods and to check the consistency of operational activities with risk objectives. Such controls are performed by non-operational departments, particularly Risk & Permanent Control and Compliance & Supervisory Relations;  Third-level controls, which are performed by Internal Audit to identify unusual patterns, procedure and regulation breaches as well as to evaluate the functioning of the overall internal control system.

The Control functions

INTERNAL AUDIT The Internal Audit department reports directly to the Board of Directors and is responsible for third-level controls, reviewing, based on the annual audit plan approved by the Board of Directors, the adequacy of the system of internal control and providing the Board of Directors and management with a professional and impartial opinion on the effectiveness of internal controls. The head of Internal Audit is responsible for preparing the audit plan, on the basis of a periodic risk assessment, and coordinates the audit missions. He reports on the findings and progress of the audit plan from time to time to the Board of Directors, the Risk & Audit Committee, the Internal Control Committee and the Board of Statutory Auditors. Internal Audit is responsible for the internal review, at least once a year, of the ICAAP - to ensure that it functions properly and is compliant with the applicable rules and the periodic examination of the process to evaluate individual risks. The internal audit process calls for each Company to map its own risks on an annual basis, by using a common methodology issued by the Parent Company. For those subsidiaries that do not have an internal audit function locally, risk mapping is performed by the Parent Company. Monitoring of the i system of quarterly reports on:  the progress of the audit plan and explanation of any deviations;

 all the audits carried out during the quarter under review;

 the status of implementation of the recommendations issued.

The Board of Directors is apprised regularly of the audit findings, the action plans undertaken, the progress of the plan and the level of implementation of the recommendations to the individual companies.

In the first half of 2020, the Internal Audit function, subject to the express approval of the Board of Directors, adapted its audit plan taking due account of the Covid19 emergency and its impacts on the bank's operations.

RISK AND PERMANENT CONTROL

Risk & Permanent Control at the Parent Company level includes staff dedicated to permanent controls that are not involved in business activities. Second-level controls performed by Risk & Permanent Control concern all the risks considered peculiar in the

-to-day business operations, which are illustrated in the map included in the ICAAP/ILAAP Report.

The group has been upgrading its Risk Appetite Frame implemented in 2015, so as to put into sharp focus the risk profile that the bank is willing to bear to pursue its strategic objectives.

The RAF upgrade is approved and constantly monitored by the Board of Directors. The process to define the Risk Appetite Framework as a standard of reference to determine risk propensity, which sets in advance the risk/return targets that the group intends to achieve, fosters also the broader dissemination of a risk culture across the group.

the relevant risk measures considered significant by the group.

Moreover, this function coordinates the consolidated ICAAP.

Risk & Permanent Control (R&PC) is represented in every group company by a local contact.

The results of the second-level controls performed by Risk and Permanent Control are reported quarterly to the Internal Control Committee and described in the six-monthly and annual Internal Control Report.

COMPLIANCE AND SUPERVISORY RELATIONS The objective of the Compliance & Supervisory Relations function is to oversee Compliance and Anti-Money-Laundering risk and managing relations with the Supervision Authorities.

The head of the function is in charge of anti-money laundering, Whistleblowing, Antitrust Compliance Manager and responsible for the reports of suspicious transactions. This manager also chairs the supervisory body of both the Company and its subsidiary Leasys S.p.A..

The Compliance & Supervisory CEO and General Manager.

The main Compliance & Supervisory Relations responsibilities concern directly the Company and, in terms of coordination and supervision, Leasys and the foreign markets.

More specifically, to evaluate the adequacy of internal procedures in preventing noncompliance with laws, rules and self-regulation provisions, the Compliance function:

 identifies, in cooperation with the departments concerned, particularly Legal Affair, the rules applicable to the Company and the group, and evaluates their impact on activities, processes and procedures;  proposes procedural and organizational changes to ensure adequate control over noncompliance risk;

 prepares reports for officers and governance bodies and other internal control functions;  assesses the effectiveness of procedural and organizational adjustments suggested to prevent non-compliance risk;  coordinates the activities of the supervisory body, ensuring that the compliance program under Legislative Decree 231/01 is constantly upgraded;  participates in the identification of training requirements and in personnel training activities to disseminate a corporate culture driven by the principles of honesty, integrity and compliance with the rules;  manages ethical issues and reports of illegal or fraudulent activities within the group.

The function is involved in the ex-ante assessment of compliance with the applicable regulations of all innovative projects, including new products and services.

Regarding anti-money-laundering and antiterrorism, the function assesses that the breach of external (laws and regulations) and internal rules on anti-money-laundering and terrorist financing.

Board committees

RISK & AUDIT COMMITTEE Pursuant to the supervisory provisions on corporate governance, the Risk & Audit Committee (RAC) provides support to the Board of Directors on risks and the internal control system as well as the proper use of accounting standards for the preparation of the separate and consolidated financial statements. With reference to risk management and control, the Committee supports the Board of Directors in:  defining and approving risk management strategies and policies; in connection with the Risk Appetite Framework (RAF), the Committee evaluates and makes recommendations for the Board of Directors to define and approve the risk

 verifying the proper implementation of risk management strategies, policies and RAF;  defining the policies and processes to evaluate corporate activities;  the preliminary review of the audit plan, the activity plans of second-level control functions and the periodic reports of the control functions to the Board of Directors;  assessing the adequacy of corporate risk control functions, the internal control procedures and the reports necessary to ensure that the Board of Directors is properly and exhaustively informed.

The Committee consists of two independent Directors, one of whom rotates as chairman, and a non-executive Director; another non-executive Director is permanently invited. An exponent of the Board of Statutory Auditors and the head of Internal Audit, acting as secretary, participate in the committee's work. The managers of the second level control functions and the company management on specific topics can be called to participate.

NOMINATION COMMITTEE Pursuant to the supervisory provisions on corporate governance, the Nomination Committee supports the Board of Directors in the process for the nomination and co- -assessment and in the CEO & General Manager succession process.

In accordance with the Articles of Association, the Committee makes recommendations and provides opinions to the Board of Directors, which in turn makes available to it the resources necessary to perform its tasks with the help of external consultants, within the

The Committee was established on March 23, 2016, pursuant to a resolution of the Board of Directors, is made up since June 30, 2017 of 3 non-executive directors, including 2 independent members.

The Committee is chaired by an independent director or, in his absence, by the other independent director.

Meetings of the Committee can be attended, depending on the topics covered, without voting rights, by the Chairman of the Board of Statutory Auditors or by a Statutory Auditor, the CEO & General Manager, the heads of the control functions or other key management functions, and other single directors.

REMUNERATION COMMITTEE Pursuant to the supervisory provisions on corporate governance, the Remuneration Committee acts in a consultative and advisory capacity for the Board of Directors on remuneration and incentive practices and policies of the FCA Bank Group.

Specifically, the Committee submits to the Board of Directors, after consultation with the CEO & General Manager, proposals on incentives, the document on remuneration policies and a report on their application (ex-post disclosure) for the annual approval by the shareholders at the general meeting.

The Committee provides regularly to the Board of Directors and the shareholders adequate information on the activity performed.

The Board of Directors makes available to it the resources necessary to perform its tasks with the help of external consultants, within the limits set by the budget and through the

The Committee, established on March 23, 2016, pursuant to a resolution of the Board of Directors, is made up, temporarily, since June 30, 2017 of 3 non-executive directors, including 2 independent members.

The Committee is chaired by an independent director or, in his absence, by the other independent director.

Meetings of the Committee can be attended, without voting rights, by the Chairman of the Board of Statutory Auditors (or by a Statutory Auditor designated by him), the CEO & General Manager, the heads of the control functions and the members of the Board of Directors.

Other committees involved in the Internal Control System To strengthen the Internal Control System, the group established, in addition to the above functions, the following committees.

INTERNAL CONTROL COMMITTEE The mission of the Internal Control Committee system for the purpose of:

 reviewing the findings of audit activities;  providing a progress report on action plans;  submitting the Audit Plan and related progress reports;  analyzing any problems and issues arising from the internal control system.

Moreover, it acts as the anti-fraud committee with the objective to monitor fraud events, the effectiveness of the fraud prevention systems in place and the adequacy of the control systems related to fraud detection.

The ICC meets on a quarterly basis, and is attended, periodically, also by representatives from the internal control functions of both shareholders.

Such meetings are a time where reports are made to senior management on the results of second and third- level activities on progress with action plans implemented as a result of findings and recommendations, including findings and recommendations made after inspections by local supervision authorities.

The involvement of the CEO and General Manager guarantees the high degree of effectiveness of the internal control system, given that he has a full and integrated overview of the findings of the audits performed, which permits implementation of the necessary corrective or remedial actions in case of flaws or anomalies.

GROUP INTERNAL RISK COMMITTEE

-setting and monitoring to revents and manages risks effectively.

The activity carried out is more analytical than that of the other control committees, as it explores in great detail, among others, the RAF and the Risk Strategy that every head of the group companies develops and submits to the GIRC every year, pursuant to the group Risk Management policy approved by the Board of Directors.

In addition, the GIRC is convened whenever the market or the Company faces a liquidity crisis and - in its restricted form, which is referred to as NPA committee evaluates and approves proposals of new products and activities coming from the markets.

Meetings of the GIRC - which are chaired by the Managing Director and General Manager are open to senior managers and, when called upon, to the Heads of the group companies.

Attendance is also open to the heads of the three internal control functions, as observers without voting rights; in particular, Risk & Permanent Control provides an opinion on risk levels in the various areas and any hedging and mitigation thereof.

In addition, in case of approval of new products and activities, Compliance & Supervisory Relations may exercise veto rights in relation to aspects falling within its purview.

Participation of the control functions in this committee fosters critical interaction with the business units; accordingly such participation is both necessary and appropriate, so as to prevent the creation of an excessive distance between the control functions and the operational context, without prejudice to the indispensable professional autonomy of the control functions.

The absence of voting rights for the control functions within the GIRC is further evidence, among others, to the separation between operational and control functions.

SUPERVISORY BOARD

With reference to the prevention of administrative liability pursuant to Legislative Decree 231/01, the Supervisory Board has been established for the Parent Company and the Italian subsidiary Leasys S.p.A., to oversee the proper application of the Compliance Program and the Code of Conduct.

The Supervisory Board:

 Meets at least once a quarter and reports periodically to the CEO and General Manager, the Board of Directors and the Board of Statutory Auditors;  Performs periodic reviews on the ability of the Compliance Program to prevent the

Risk &Permanent Control functions as well as the other functions as necessary from time to time. s made up of the Head of Compliance and Supervisory Relations, the Head of Internal Audit and an external legal and penal expert who acts as Chair.

OTHER INFORMATION

PRINCIPAL RISKS AND UNCERTAINTIES The specific risks that can give rise to obligations for the Company are evaluated when the relevant provisions are made and are reported in the notes to the financial statements, together with significant contingent liabilities. In this section, reference is made to risk and uncertainty factors related essentially to the economic, regulatory and market context

first of all by the various factors that make up the macroeconomic picture in which it operates, including increases and decreases in gross domestic product, consumer and business confidence levels, trends in interest, exchange and unemployment rates.

The g is historically cyclical. Bearing in mind that it is hard to predict the breadth and length of the different economic cycles, every macroeconomic event (such as a significant drop in the main end markets, the solvency of counterparties, the volatility of financial markets and interest rates) can impact the g

Special emphasis is placed at this particular time to the extraordinary circumstances determined by Covid-19, with the continuing uncertainty on its impact on the general pandemic.

The FCA Bank Group complies with the laws in the countries in which it operates. Most of the legal proceedings are involved in reflect disputes on payment delinquencies by customers and dealers in the course of our ordinary business activities. Our policy on provisions for loan and lease losses, and the close monitoring under way, allows us to evaluate promptly the possible effects on our accounts.

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DIRECTION AND COORDINATION ACTIVITIES

FCA Bank S.p.A. is not subject to direction and coordination of other companies or entities. Companies under the control (direct or indirect) of FCA Bank S.p.A. have identified it as the entity that performs direction and coordination activities, pursuant to Article 2497-bis of the Italian Civil Code. This activity involves setting the general strategic and operating guidelines for the group, which then are translated into the implementation of general policies for the management of human and financial resources, and marketing/communication. Furthermore, coordination of the group includes centralized treasury management and internal audit services. This allows the subsidiaries, which retain full management and operational autonomy, to achieve economies of scale by availing themselves of professional and specialized services with increasing levels of quality and to concentrate their resources on the management of their core business.

GOING CONCERN ASSUMPTION With respect to the going concern assumption, the Directors did not see in the financial condition, operating results and cash flows any indication that the Company might not qualify as a going concern. Accordingly, they are reasonably certain that the FCA Bank Group will continue to be operational in the foreseeable future and, as such, the Consolidated Financial Report as of and for the six months ended June 30, 2020 has been prepared based on a going concern assumption. The accounting policies adopted are consistent with the going concern assumption, with the accrual basis of accounting as well as with the relevance and materiality principles of the accounting information and the prevalence of economic substance over legal form. These policies were unchanged compared to previous years.

DIVIDEND AND RESERVE DISTRIBUTIONS No dividends were distributed in the first half of 2020, in line with the recommendations of the General Board of the European Systemic Risk Board (ESRB) which, on June 8, 2020, supplemented the March 27, 2020 on dividend distributions, by publishing a new recommendation on restraints on dividend payments until January 1, 2021.

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Consolidated income statement details and reconciliation with reclassified income statement Reclassified Income 30/06/2020 Statements Items 10 INTEREST INCOME AND SIMILAR REVENUES 441 NBI 80 NET INCOME FINANCIAL ASSETS AND LIABILTIES HELD FOR TRADING 1 NBI 40 FEES AND COMMISSIONS INCOME 62 FEES AND COMMISSIONS INCOME 53 NBI FEES AND COMMISSIONS INCOME 9 NOE FINANCIAL REVENUES 504 of which insurance 114

100 PROFITS (LOSSES) ON DISPOSAL OR REPURCHASE OF FINANCIAL ASSETS AT AMORTIZED COST 0 NBI 160 NET PREMIUM EARNED 1 NBI 170 NET OTHER OPERATING INCOME/ CHARGES FROM INSURANCE ACTIVITIES (0) NBI TOTAL FINANCIAL REVENUES 504

20 INTEREST EXPENSES AND SIMILAR CHARGES (116) NBI 90 FAIR VALUE ADJUSTMENTS IN HEDGE ACCOUNTING (4) NBI 50 FEES AND COMMISSIONS EXPENSES (15) Fees and commission expenses (10) NBI Insurance credit costs (5) COR TOTAL FINANCIAL COSTS (134)

130 IMPAIRMENT LOSSES ON LOANS (28) COR 0 180 NET PROFIT FROM FINANCIAL AND INSURANCE ACTIVITIES 342

190 ADMINISTRATIVE COSTS (136) NOE Administrative costs (123) NOE Administrative costs (13) OTH 200 NET PROVISIONS FOR RISKS AND CHARGES (5) Net provisions for risks and charges (5) NBI Net provisions for risks and charges (1) NOE Net provisions for risks and charges 0 OTH 210 DEPRECIATION /IMPAIRMENT ON TANGIBLE ASSETS (251) Depreciation of rental assets (rental business) (243) NBI Depreciation of tangible assets (8) NOE 220 AMORTISATION/ IMPAIRMENT ON INTANGIBLE ASSETS (8) NOE 230 OTHER OPERATING INCOME / CHARGES 358 Rental income/charges (rental business) 369 NBI Expenses recoveries and credit collection expenses (3) NOE Impairment of rental receivables (rental business) (7) COR Other (1) OTH 240 OPERATING COSTS (42)

290 TOTAL PROFIT OR LOSS BEFORE TAX FROM CONTINUING OPERATIONS 300 300 TAX EXPENSE RELATED TO PROFIT OR LOSS FROM CONTINUING OPERATIONS (75) TAX 330 NET PROFIT OR LOSS 225 340 MINORITY PROFIT (LOSS) OF THE PERIOD 350 PROFIT (LOSS) OF THE PERIOD 225

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Reclassified Income Statements Items 30/06/2020

Net Banking Income 487 NBI Net Operating Expenses (133) NOE Cost of risk (40) COR Other income / (expenses) (13) OTH Profit before tax 300

Tax expenses (75) TAX Net profit 225

Turin, 24 July 2020

Chief Executive Officer and General Manager Giacomo Carelli

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HALF-YEARLY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statement of Financial Position

Consolidated Income Statement

Consolidated Statement of Comprehensive Income

Consolidated Statement of Changes in Equity

Consolidated Statement of Cash Flows

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION

30/06/2020 31/12/2019

10. Cash and cash balances 619,727 585,272 Financial assets measured at fair value through other comprehensive 30. 9,869 9,807 income (FVOCI) 40. Financial assets measured at amortized cost 23,983,859 25,903,033

a) Loans and advances to banks 2,284,690 1,997,944

b) Loans and advances to customers 21,699,169 23,905,089 50. Hedging derivatives 34,644 36,930 60. Changes in fair value of portfolio hedge items (+/-) 72,778 48,145

70. Equity Investments 59 44 80. Insurance reserves attributable to reinsurers 13,949 13,159 90. Property, plant and equipment 3,318,676 3,196,737 100. Intangible assets 271,529 262,573

of which: -

- goodwill 196,873 183,183 110. Tax assets 357,739 299,861

a) current 148,457 98,829

b) deferred 209,281 201,032

120. Non-current assets and disposal groups classified as held for sale - 130. Other assets 1,291,508 1,350,171

Total assets 29,974,339 31,705,732

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30/06/2020 31/12/2019

10. Financial liabilities at amortised cost 25,044,303 26,933,628 a) Deposits from banks 9,982,897 10,278,046

b) Deposits from customers 1,946,424 1,798,752

c) Debt securities in issue 13,114,982 14,856,829 20. Financial liabilities held for trading 2,388 3,407 40. Hedging derivatives 98,458 91,533 60. Tax liabilities 295,267 238,205

a) current 97,912 55,162

b) deferred 197,355 183,043 80. Other liabilities 915,178 1,014,431 90. Provisions for employee severance pay 11,356 11,726 100. Provisions for risks and charges 214,561 225,504

a) committments and guarantees given - -

b) post-retirement benefit obligations 48,314 49,954 c) other provisions for risks and charges 166,247 175,550 110. Insurance reserves 17,505 16,127 120. Revaluation reserves (47,733) (26,989) 150. Reserves 2,250,071 1,970,072 155 Interim dividends - (180,000) 160. Share premium 192,746 192,746 170. Share capital 700,000 700,000 190. Minorities (+/-) 58,363 54,931 200. Net Profit (Loss) for the period (+/-) 221,875 460,413

Total liabilities and shareholders' equity 29,974,339 31,705,732

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CONSOLIDATED INCOME STATEMENT

30/06/2020 30/06/2019 10. Interest income and similar revenues 440,656 466,231 of which: interest income calculated using the effective interest 426,145 465,321 method 20. Interest expenses and similar charges (115,578) (117,220) 30. Net interest margin 325,078 349,011 40. Fees and commissions income 62,449 73,208 50. Fees and commissions expenses (15,070) (23,816) 60. Net fees and commissions 47,379 49,392 80. Net gains (losses) on trading 816 987 90. Net gains (losses) on hedge accounting (3,675) (2,246) 100. Profits (losses) on disposal or repurchase of: 232 - a) Financial asstets valued at amortized cost 232 - 120. Operating income 369,830 397,144 130. Net impairment/reinstatement for credit risk: (27,668) (22,965)

a) Financial asstets valued at amortized cost (27,668) (22,965) 150. Net profit from financial activities 342,162 374,179 160. Net premium earned 989 304 170. Net other operating income/charges from insurance activities (482) 871 180. Net profit from financial and insurance activities 342,669 375,354

190. Administrative costs: (136,045) (140,533) a) payroll costs (82,187) (87,157) b) other administrative costs (53,858) (53,376) 200. Net provisions for risks and charges (5,365) (9,177) a) commitments and financial guarantees given - - b) other net provisions (5,365) (9,177) 210. Depreciation/Impairment on tangilble assets (251,344) (209,792)

220. Amortisation/Impairment on intangilble assets (7,818) (6,968)

230. Other operating income/charges 358,405 304,675 240. Operating costs (42,166) (61,794) 290. Total profit or loss before tax from continuing operations 300,503 313,560

300. Tax expenses related to profit or loss from continuing operations (75,195) (75,097)

310. Total profit or loss after tax continuing 225,308 238,463

330. Net profit or loss 225,308 238,463 340. Minority profit (loss) of the period (3,433) (2,201) 350. profit (loss) of the period 221,875 236,262

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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(migliaia di euro)

30/06/2020 30/06/2019 10. Profit (loss) of the period 225,308 238,463 Other comprehensive income after tax not reclassified to profit or loss - 0 70 Defined-benefit plans - Other comprehensive income after tax reclassified to profit or loss (21,158) (7,859) 110 Exchange rate differences (17,644) 770 120 Cash flow hedging (3,514) (8,629) 170 Total other comprehensive income after tax (21,158) (7,859)

180 Other comprehensive income (Item 10+170) 204,150 230,604 190 Total comprehensive income (loss) attributable to non - controlling interests 3,433 2,201 Total comprehensive income (loss) attributable to the Shareholders of the 200 200,717 228,403 Parent

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AS OF 30/06/2020 AND 30/06/2019

Non- controlling Allocation on profit Changes during the period Equity Closing Changes interests as Balance as from previus year attributable balance in at at to Parent as at opening Equity transactions 01/01/2020 Changes Consolidated Company's 30/06/2020 31/12/2019 balance Dividends New Special Changes in Change in shareholders in Share Derivatives Stock comprehensive Reserves and other share dividends equity equity Equity as at as at reserves buyback on shares options income allocations issues paid instruments investments 30/06/2020 30/06/2020 Share capital: a) common 703,389 703,389 703,389 700,000 3,389 shares b) other - - - shares Share premium 195,623 195,623 195,623 192,746 2,877 reserve

Reserves: - - a) retained 2,012,126 2,012,126 287,075 2,299,201 2,250,486 48,715 earnings b) other - - - - - Valutation (27,041) (27,041) (21,158) (48,199) (48,148) (51) reserve Equity - - - instruments Interim (180,000) (180,000) 180,000 - - - dividends Treasury - - - - - shares Profit (loss) 467,075 467,075 (287,075) (180,000) 225,308 225,308 221,875 3,433 of the period

Equity 3,171,172 3,171,172 ------204,150 3,375,322 Equity attributable to parent 3,116,241 3,116,241 - 200,717 3,316,959 Company's shareholders Non- controlling 54,931 54,931 3,433 58,363 interests

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Equity Allocation on profit Changes during the period Non- Closing Changes attributable Balance as from previus year Equity transactions controlling balance as in to Parent at Changes Consolidated interests as at opening Dividends New Special Changes in Change in Company's 01/01/2019 in Share Derivatives Stock comprehensive at 31/12/2018 balance Reserves and other share dividends equity equity shareholders reserves buyback on shares options income Equity as at allocations issues paid instruments investments as at 30/06/2019 30/06/2019 30/06/2019 Share capital: a) common 703,389 703,389 - 703,389 700,000 3,389 shares b) other - - - - - shares Share premium 195,623 - 195,623 - 195,623 192,746 2,877 reserve

Reserves: a) retained 1,625,784 1,625,784 388,364 - 2,014,148 1,971,975 42,173 earnings b) other - - - - Valutation (35,651) (35,651) (7,859) (43,510) (43,467) (43) reserve Equity - - - - instruments Interim ------dividends Treasury - - - - shares Profit (loss) for the 388,364 388,364 (388,364) 238,463 238,463 236,262 2,201 period

Equity 2,877,508 - 2,877,508 ------230,604 3,108,113 Equity attributable to parent 2,829,111 2,829,111 228,403 3,057,516 Company's shareholders Non- controlling 48,397 48,397 2,201 50,597 interests

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CONSOLIDATED STATEMENT OF CASH FLOWS (DIRECT METHOD)

30/06/2020 30/06/2019 A. OPERATING ACTIVITIES 1. Business operations 483,348 597,624 - interest income (+) 437,007 564,553 - interest expenses (-) (137,264) (151,706) - fees and commissions income (expense) (+/-) 47,379 49,392 - personnel expenses (-) (77,059) (80,939) - net earned premiums (+) 989 304 - Other insurance income/expenses (+/-) (482) 871 - other expenses (-) (51,493) (46,618) - other revenues (+) 339,710 324,424 - taxes (-) (75,439) (62,657) 2. Cash flows from increase/decrease of financial assets 1,816,523 (856,613) - financial assets at fair value with impact on other (62) (252) comprehensive income - financial assets at amortized cost 1,881,266 (469,769) - other assets (64,681) (386,592) 3. Cash flows from increase/decrease of financial liabilities (1,949,302) 1,148,302

- fiancial liabilities at amortized cost (1,867,639) 845.950 - financial liabilities held for trading (1,019) (1,516) - other liabilities (80,644) 303,868 Cash flows generated by/(used for) operating activities 350,569 889,313 B. INVESTING ACTIVITIES - 1. Cash flows generated by - - - sales of property, plant and equipment - - 2. Cash flows used for (316,114) (484,409) - purchases of property,plant and equipment (313,045) (480,131) - purchases of intangible assets (3,069) (4,279) Cash generated by / (used for) investing activities (316,114) (484,409) C. FINANCING ACTIVITIES - dividend distributions and other - - Cash generated by / (used for) financing activities - -

CASH GENERATED /(USED) DURING THE PERIOD 34,455 404,904

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30/06/2020 30/06/2019 Cash and cash equivalents - opening balances 585,272 362,536 Cash generated (used) during the period 34,455 404,904 Cash and cash equivalents - closing balances 619,727 767,440

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

ACCOUNTING POLICIES

GENERAL INFORMATION

Section 1 Statement of compliance with International Financial Reporting Standards

The consolidated half-year financial report as at June 30, 2020 has been prepared in compliance with IAS 34 requirements, which regulate interim financial reporting. The consolidated half-year financial report do not disclose all the information required for the preparation of the annual consolidated financial statements. For this reason it is necessary to read the consolidated half-year financial report together with the consolidated financial statements as at 31 December 2019.

The accounting standards adopted in preparation of this consolidated half-year financial report are conform to those used for the preparation of the consolidated financial statements as at 31 December 2019, except for the international financial reporting standards endorsed by the European Union with effect applicable as of 1 January 2020. The group has not early adopted any accounting standards, amendments or IFRS and IFIC interpretations endorsed but not mandatorily applicable.

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Section 2 Basis of preparation

The consolidated half-year financial report have been prepared in accordance with the IAS/IFRSs in force at June 30, 2020 (including the interpretation documents known as SIC and IFRIC), as endorsed by the European Commission.

Unit of account

Save as otherwise indicated, the amounts indicated in the financial statement schedules are in thousands of euros.

Schemes of the consolidated half-year financial statements

The consolidated half-yearly financial statements, prepared in a condensed form as allowed by IAS 34, consist of the Consolidated Statement of financial position, the Consolidated Income statement, the Consolidated Statement of Comprehensive income, the Consolidated Statement of changes in equity, the Consolidated Cash flow statement and are accompanied by an interim report on group operations by the Board of Directors.

Going concern

The consolidated half-yearly financial statements have been prepared on a going concern basis, in accordance with the accrual basis of accounting and pursuant to accounting standards consistent with those adopted in previous years.

Risks and uncertainties related to the use of estimates

The preparation of the half-yearly consolidated financial report requires management to make estimates and assumptions with effects on the amount of revenues, costs, assets and liabilities and on the disclosure of contingent assets and liabilities as of the reporting date. If in the future these estimates and assumptions, which are based on in the period in which the circumstances change. For a more in-depth discussion of the most important measurement processes for the group, reference is made to the section on Risk and uncertainties related to the use of estimates for the consolidated financial statements as of December 31, 2019.

Moreover, it is noted that certain measurement processes, particularly the more complex ones, are carried out in full only when the annual financial statements are prepared, when all the information necessary is available, except for the cases where there are impairment indicators requiring immediate recognition of any impairment loss.

The bank tested for impairment the goodwill arising from past acquisitions of Cash Generating Units (CGUs), to determine the recoverability of their amounts at June 30, 2020, considering the unpredictable impacts of the Covid- 19 outbreak on the global economic picture. The method used was unchanged. The Value in Use of the CGUs was determined by discounting to present value the cash flows expected to be generated by the CGUs over the next five-year period. Future cash flows have been estimated on the basis of an updated version of the strategic plan used to carry out the impairment test for 2019. The cash flows of the last year of the forecast period are projected into perpetuity (by applying the perpetual annuity

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equal to the medium-term rate of inflation in the euro area and constant over time).

No impairment was found at June 30, 2020, as the recoverable amounts of the CGUs were higher than their carrying amounts. The assumptions underlying the calculations of the recoverable amounts of the CGUs are based on past experience and profit forecasts approved by the Board of Directors and are consistent with external sources of information. Specifically:

 the 10.05% discount rate was calculated as cost of capital, based on a risk-free rate of -0.47%, a risk premium of 8.38% for the Company and a beta of 1.26;

 the estimated growth rate is 1.3%.

In addition sensitivity analyses were carried out, simulating a change in the significant parameters of the impairment test, including an increase of up to 1% in th a possible deterioration of market conditions. The analysis revealed that the recoverable amounts of the CGUs was greater than their carrying amounts.

Similarly, the actuarial calculation necessary to determine Provisions for post-employment benefits are typically performed when the annual accounts are prepared.

Income tax is recognised on the basis of the best estimate of the expected effective income tax rate for the year.

With the introduction of IFRS 9 in the Dealer Financing and Retail businesses and with a simplified approach in the rental business line, the bank currently makes provisions for losses in view of expected credit losses in a forward- looking perspective, as well as in a historical perspective. Expected credit losses (ECL) are measured as follows:

ECL= PDxLGDx EAD

 probability of default. Likelihood of a default by a counterparty or of a contract in a pre-established time horizon;  Loss given default. Loss that the bank would incur determined by the likelihood of a default by a counterparty or of a contract in a pre-established time horizon;  Exposure at default. Exposure at the time of default.

In order to include a forward looking impact on ECL, two satellite models have been developed, one for retail and one for wholesale financing.

the two macroeconomic scenarios, baseline and adverse.

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In order to develop the two scenarios, following a significant analysis, some macroeconomic variables (ex. GDP, euribor), have been used both for retail and wholesale financing models. Furthermore, for retail model, also some considered (ex. Registrations, Market share). The weight to be assigned to each scenario is approved by the Provisioning Committee together with the forward looking models.

Regarding the closing figures at June 30, 2020, the weight of the base scenario is 90% (adverse scenario is 10%) for the Retail Financing product and 50% (adverse scenario 50%) for the Wholesale Financing product.

The table below shows the main prospective macroeconomic indicators used by the forward looking model, by product:

Retail Financing Base Scenario Adverse Scenario 2020 2021 2022 2020 2021 2022

-8.5% 5.5% 1.5% -11.7% 0.0% 0.0%

Yearly change of Brent crude oil price -93.7% 52.4% 8.3% -93.7% 0.0% 0.0% Yearly change of 3-month Euribor (with a 1-year observation time lag) 0.01% -0.07% -0.06% 0.02% -0.04% -0.04%

Wholesale Financing Base Scenario Adverse Scenario 1 quarter 1 quarter 1 quarter 1 quarter 2020 2021 2020 2021

a 1-quarter observation time lag) -0.3% 2.4% -0.3% 1.2%

10.0% 11.2% 10.0% 11.4%

The frequency of the forward looking update is at least on half year basis.

The portfolio is divided in 3 buckets, with the classification of credits in stages depending on the level and change over time of the credit risk. Changes in stages can be due both to a deteriorated credit risk or to an improved credit risk.

Other information

The half-yearly consolidated financial report is subject to a limited audit by EY S.p.A.

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Section 3 Scope and methods of consolidation The half-yearly consolidated financial report as of June 30, 2020 include the accounts of the Parent Company, FCA Bank S.p.A., and its direct and indirect Italian and foreign subsidiaries, as required by IFRS 10. They reflect also the entities, including structured entities, in relation to which the Parent Company has exposure or rights to variable returns and the ability to affect those returns through power over them. To determine the existence of control, the group considers the following factors:  ives, the activities that give rise to its returns and how such activities are governed;  the power over the investee and whether the group has contractual arrangements, which attribute it the ability to govern the relevant activities; to this end, attention is paid only to substantive rights, which provide practical governance capabilities;  the exposure to the investee to determine whether the group has arrangements with the investee whose returns

If the relevant activities are governed through voting rights, control may be evidenced by considering potential or majority of the voting rights, to appoint the majority of the members of the board of directors or otherwise the power to govern the financial and operating policies of the entity. Subsidiaries may include any structured entities, where voting rights are not paramount to determine the existence of control, including special purpose vehicles (SPVs). Structured entities are considered subsidiaries where:  the group has the power, through contractual arrangements, to govern the relevant activities;  the group is exposed to the variable returns deriving from their activities.

The group does not have investments in joint ventures.

The table below shows the companies included in the scope of consolidation.

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1. Investments in controlled subsidiaries

COUNTRY OF TYPE OF PARENT COMPANY SHARIN NAME REGISTERED OFFICE INCORPORATI RELATIONSH (***) G % ON (*) IP (**) FCA Bank S.p.A. Turin - Italy Leasys S.p.A. Turin - Italy Rome - Italy 1 100.00 Clickar S.r.l. Turin - Italy Rome - Italy 1 Leasys S.p.A. 100.00 FCA Capital France SA Trappes - France 1 100.00 Leasys France SAS Trappes - France 1 Leasys S.p.A. 100.00 FCA Leasing France SNC Trappes - France 1 FCA Capital France SA 99.99 Aixia Developpement S.A.S. Limonest - France 1 Leasys S.p.A. 100.00 Aixia Developpement Aixia Systemes S.A.S. Limonest - France 1 S.A.S. 100.00 Aixia Developpement Aixia Location S.A.S. Limonest - France 1 S.A.S. 100.00 Aixia Developpement Rent All S.A.S. Limonest - France 1 S.A.S. 100.00 FCA Bank Deutschland GmbH Heilbronn - Germany 1 100.00 FCA Automotive Services UK Ltd Slough - UK 1 100.00 FCA Dealer Services UK Ltd Slough - UK 1 100.00 Leasys UK Ltd Slough - UK 1 Leasys S.p.A. 100.00 Leasys Rent S.p.A. Bolzano - Italy Fiumicino - Italy 1 Leasys S.p.A. 100.00 Alcala de Henares - Spain 1 100.00 Alcala de Henares - SA Spain 1 100.00 FCA Capital Portugal IFIC SA Lisbon - Portugal 1 100.00 FCA Dealer Services Portugal SA Lisbon - Portugal 1 100.00 Schlieren - FCA Capital Suisse SA Switzereland 1 100.00 Leasys Polska Sp.Zo.o. Warsaw - Poland 1 Leasys S.p.A. 100.00 Lijnden - the FCA Capital Netherlands BV Netherlands 1 100.00 Lijnden - the Leasys Nederland B.V. Netherlands 1 Leasys S.p.A. 100.00 FCA Capital Danmark A/S Glostrup - Denmark 1 100.00 FCA Bank GmbH Vienna - Austria 2 50.00 Ferrari Financial Services GmbH Pullach - Germany 1 50.0001 FCA Leasing GmbH Vienna - Austria 1 100.00 FCA Capital Hellas SA Athens - Greece 1 99.99 FCA Insurance Hellas SA Athens - Greece 1 FCA Capital Hellas SA 99.99 FCA Capital Re DAC Dublin - Ireland 1 100.00 FCA Capital Danmark FCA Capital Sverige AB Kista - Sweden 1 A/S 100.00 FCA Capital Danmark FCA Capital Norge AS Barum - Norway 1 A/S 100.00

(*) If different from Registered Office (**) Relation Type: 1 = majority of voting rights at ordinary meetings 2 = dominant influence at ordinary meeting (***) If different from FCA Bank S.p.A.

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The structured entities related to securitization transactions, whose details are provided below, are fully consolidated:

NAME COUNTRY Nixes Six PLc London - UK Nixes Seven B.V. Amsterdam - The Netherlands Fast 3 S.r.l. Milan - Italy Erasmus Finance DAC Dublin - Ireland A-BEST TEN S.r.l. IN LIQUIDAZIONE Conegliano (TV) - Italy A-BEST ELEVEN UG Frankfurt am Main - Germany A-BEST TWELVE S.r.l. Conegliano (TV) - Italy A-BEST THIRTEEN FT Madrid - Spain A-BEST FOURTEEN S.r.l. Conegliano (TV) - Italy A-BEST FIFTEEN S.r.l. Conegliano (TV) - Italy A-BEST SIXTEEN UG Frankfurt am Main - Germany A-BEST SEVENTEEN S.r.l. Conegliano (TV) - Italy

2. Investments in subsidiaries with significant non-controlling interests

Non-controlling interests, availability of non- - controlling interests

Availability of non- Non-controlling Dividends distributed to Name controlling interests' interests (%) non-controlling interests voting rights (%) FCA BANK GMBH (Austria) 50% 50% - FERRARI FINANCIAL SERVICES GMBH 49.99% 49.99% - (Germany)

Pursuant to IFRS 10, FCA Bank GmbH (Austria), a 50%-held subsidiary and Ferrari Financial Services GmbH a 50.0001%-held subsidiary are included in the consolidation area.

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Investments in subsidiaries with significant non-controlling interests.

The table below provides financial and operating highlights of FCA Bank GmbH and of Ferrari Financial Services GmbH before intercompany eliminations required by IFRS 12:

(amounts in thousands of euros)

FCA BANK GMBH (AUSTRIA) 30/06/2020 31/12/2019

Total assets 206,574 246,994 Finacial assets 202,601 244,956 Financial liabilities 140,005 195,241 Equity 53,701 51,753 Net interest income 3,137 8,644 Net fees and commissions income 295 407 Banking income 3,432 9,052 Net result from investment activities 3,820 8,882 Net result from investment and insurance activities 3,820 8,882 Operating costs (1,029) (2,260) Profit (loss) before taxes from continuing operations 2,792 6,622 Net profit (loss) of the period 1,951 5,242

(amounts in thousands of euros)

FERRARI FINANCIAL SERVICES GMBH (GERMANY) 30/06/2020 31/12/2019

Total assets 684,860 681,310 Finacial assets 671,863 671,580 Financial liabilities 609,529 607,940 Equity 62,965 58,140 Net interest income 12,413 21,300 Net fees and commissions income (156) 329 Banking income 12,139 21,332 Net result from investment activities 11,288 20,069 Net result from investment and insurance activities 11,288 20,069 Operating costs (4,450) (8,973) Profit (loss) before taxes from continuing operations 6,838 11,096 Net profit (loss) of the period 4,916 8,086

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Consolidation methods

In preparing the half-yearly consolidated financial report, the financial statements of the parent company and its subsidiaries, prepared according to IAS/IFRSs, are consolidated on a line-by-line basis by adding together like items of assets, liabilities, equity, income and expenses. each such subsidiary are eliminated. Any difference arising during this process after the allocation to the assets and liabilities of the subsidiary is recognized as goodwill on first time consolidation and, subsequently, among other reserves. The share of net profit pertaining to non-controlling interests is indicated separately, in order to determine the

Assets, liabilities, costs and revenues arising from intercompany transactions are eliminated. The financial statements of the Parent Company and those of the subsidiaries used for the half-yearly consolidated financial report all refer to the same date. For foreign subsidiaries which prepare their accounts in currencies other than the euro, assets and liabilities are translated at the exchange rate on the balance sheet date, while revenues and costs are translated at the average exchange rate for the period. Exchange differences arising from the conversion of costs and revenues at the average exchange rate and the conversion of assets and liabilities at the reporting date are reported in profit or loss in the period. Exchange differences arising from the equity of consolidated subsidiaries are recognized in other comprehensive

The exchange rates used to translate the financial statements at June 30, 2020 are as follows:

Average Average 30/06/2020 30/06/2020 31/12/2019 31/12/2019 Polish Zloty (PLN) 4.456 4.412 4.257 4.300 Danish Crown(DKK) 7.453 7.465 7.472 7.466 Swiss Franc (CHF) 1.065 1.064 1.085 1.112 GB Pound (GBP) 0.912 0.875 0.851 0.878 Norwegian Krone (NOK) 10.912 10.732 9.864 9.851 Moroccan Dirham (MAD) 10.878 10.759 10.740 10.764 Svedish Krona (SEK) 10.495 10.660 10.447 10.589

Subsequent events

Effective 17th July 2020 Aixia Developpement S.A.S. changed its name to Leasys Rent France S.A.S..

No events occurred after the balance sheet date which should results in adjustments of the half-yearly consolidated financial report as of June 30, 2020.

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INTERNATIONAL FINANCIAL REPORTING STANDARDS ENDORSED BY THE EUROPEAN UNION, WITH EFFECT APPLICABLE AS OF JANUARY 1, 2020 EC DATE OF DATE OF DESCRIPTION ENDORSEMENT PUBBLICATION APPLICATION OF STANDARD/AMENDMENT REGULATION 551/2020 April 22, 2020 January 1, 2020 Amendment to IFRS 3 The IASB, in the updated version of IFRS 3 - Business combinations, changed the definition of company. The new definition shows that the purpose of the company is to provide products and services to customers, while the previous definition focused on the purpose of producing outcome in the form of dividends, lower costs or other benefits economic for investors or others. Distinguishing between a business and a group of assets is important because an acquirer recognises goodwill only when acquiring a business. Companies apply to business combinations the new definition starting from the operations having date of stipulation later than January 1, 2020. These changes didn't have any impact on the bank's condensed consolidated half-year financial statements.

34/2020 January 16, 2020 January 1, 2020 Amendment to IFRS 9, IAS 39 e IFRS 7: interest rate benchmark reform The IASB has issued amendments to IFRS 9, IAS 39 and IFRS 7 that modifies IFRS 9 and IAS 39 hedge accounting policies. A hedging relationship is affected if the reform generates uncertainties on the timing and / or on the extent of the cash flows based on the reference parameters of the hedged item or the hedging instrument. These changes didn't have any impact on the bank's condensed consolidated half-year financial statements.

2104/2019 December 10, 2019 January 1, 2020 Amendment to IAS 1 and IAS 8. The IASB clarified in IAS 1

with that used in the Conceptual Framework and in the IFRS. Information is material if omitting or misstating it could reasonably affect the decisions that the primary users of financial statements make on the basis of those financial statements. These changes didn't have any impact on the bank's condensed consolidated half-year financial statements.

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EC DATE OF DATE OF DESCRIPTION ENDORSEMENT PUBBLICATION APPLICATION OF STANDARD/AMENDMENT REGULATION 2075/2019 December 6, 2019 January 1, 2020 Amendments to References to the Conceptual Framework in IFRS Standards The IASB issued on on 29 March 2018 a revised version of its Conceptual Framework for Financial Reporting that underpins IFRSs. This instrument helps to ensure that the Standards are conceptually consistent and that similar transactions are treated the same way, providing useful information for investors and others. The Conceptual Framework also assists companies in developing accounting policies when no IFRS Standard applies to a particular transaction; and it helps stakeholders more broadly to understand the Standards better. The revised Conceptual Framework includes: a new chapter on measurement; guidance on reporting financial performance; improved definitions and guidance - in particular the definition of a liability; and clarifications in important areas, such as the roles of stewardship, prudence and measurement uncertainty in financial reporting. These changes didn't have any impact on the bank's condensed consolidated half-year financial statements.

On May 28, - Leases, to make it easier for lessors to account for Covid-19-related rent concessions, such as temporary rent reductions or rent holidays. The amendment exempts lessees from having to consider whether rent concessions as a direct consequence of the Covid-19 pandemic are lease modifications and allows lessees to account for such rent concessions as if they were not lease modifications. The amendment applies as of June 1, 2020 but lessees can apply the amendment in any financial statements interim or annual not yet authorized for issue. This amendment did not have any impact on the bank.

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ACCOUNTING STANDARDS, AMENDMENTS AND INTERPRETATIONS NOT YET ENDORSED BY THE EUROPEAN UNION

STANDARD/ DATE OF DATE OF DESCRIPTION AMENDMENT PUBBLICATION APPLICATION OF STANDARD/AMENDMENT IFRS 17 - Insurance contracts May 18, 2017 January 1, 2021 IFRS 17 - Insurance contracts On May 18, 2017, the IASB issued IFRS 17 - Insurance Contracts which applies to annual reporting periods beginning on or after January 1, 2021. The new standard, which deals with accounting for insurance contracts (previously known as IFRS 4), intends to improve the understanding of investors, among others,

financial position. The IASB published a final version after a long consultation phase. IFRS 17 is a complex standard which will include certain key differences from the current accounting treatment regarding the measurement of liabilities and the recognition of profits. IFRS 17 applies to all insurance contracts. The accounting model of reference, the General Model, is based on the present value of expected cash flows, the identification of a risk adjustment and a contractual service margin

which cannot be negative and represents the present value of unearned profit, to be released to profit or loss in each period with the passage of time.

Amendments to IAS 1 January 23, 2020 January 1, 2022 Amendments to IAS 1 Presentation of Financial Presentation of Financial Statements: Classification of Liabilities as Current or Statements: Classification of Non-current Liabilities as Current or Non- On January 23, 2020, the IASB issued the amendments current to IAS 1 Presentation of Financial Statements to clarify how to classify debt and other liabilities as current or non-current. The amendments aim to promote consistency in applying the requirements by helping companies determine whether, in the statement of financial position, debt and other liabilities with an uncertain settlement date should be classified as current (due or potentially due to be settled within one year) or non-current. The amendments include clarifying the classification requirements for debt a company might settle by converting it into equity. The amendments clarify, not change, existing requirements, and so are not expected to affect

they could result in companies reclassifying some liabilities from current to non-current, and vice versa. These amendmentsthe will be applied starting from January 1, 2022. Early application of the amendments is permitted.

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MAIN ITEMS IN THE FINANCIAL STATEMENTS

This section shows the accounting policies adopted to prepare the half-yearly consolidated financial report as of June 30, 2020. Such description is provided with reference to the recognition, classification, measurement and derecognition of the different assets and liabilities.

1. Financial assets measured at fair value through other comprehensive income (FVOCI)

This category includes the financial assets that meet both the following conditions:  the financial asset is held under a business model whose objective is achieved both through the collection of expected contractual cash flows and through sale (Hold to Collect and Sell business model), and  the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments

This caption also includes equity instruments, not held for trading, for which the option was exercised upon initial recognition of their designation at fair value through other comprehensive income. In particular, this caption includes:  debt securities that can be attributed to a Hold to Collect and Sell business model and that have passed the SPPI test;  equity interests, that do not qualify as investments in subsidiaries, associates or joint ventures and are not held for trading, for which the option has been exercised of their designation at fair value through other comprehensive income;  loans that are attributable to a Hold to Collect and Sell business model and have passed the SPPI Test, including the portions of syndicated loans subscribed that are originally intended to be sold and are part of a Hold to Collect and Sell business model.

According to the general rules established by IFRS 9 on the reclassification of financial assets (except for equity instruments, for which no reclassification is permitted), reclassifications to other categories of financial assets are not permitted unless the entity changes its business model for those financial assets. In such cases, which are expected to be highly infrequent, the financial assets may be reclassified from those measured at fair value through other comprehensive income to one of the other two categories established by IFRS 9 (Financial assets measured at amortized cost or Financial assets measured at fair value through profit or loss). The transfer value is the fair value at the time of the reclassification and the effects of the reclassification apply prospectively from the reclassification date. In the event of reclassification from this category to the amortized cost category, the cumulative gain (loss) recognized in the valuation reserve is allocated as an adjustment to the fair value of the financial asset at the reclassification date. In the event of reclassification to the fair value through profit or loss category, the cumulative ncome (loss).

Initial recognition of financial assets occurs at settlement date for debt securities and equity instruments and at disbursement date for loans. On initial recognition, assets are recorded at fair value, including transaction costs and revenues directly attributable to the instrument.

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After initial recognition, the Assets classified at fair value through other comprehensive income, other than equity instruments, are measured at fair value, with the recognition in profit or loss of the impact resulting from the application of the amortized cost, the impairment effects and any exchange rate effect, whereas the other gains and al asset is derecognized. Upon the total or partial sale, the cumulative gain or loss in the valuation reserve is transferred, in whole or part, to the income statement.

Equity instruments, for which the choice has been made to classify them in this category, are measured at fair value and the amounts recognized in Other comprehensive income cannot be subsequently transferred to profit or loss, not even if they are sold. The only component related to these equities that is recognized through profit or loss is their dividends. Fair value is determined on the basis of the criteria already described for Financial assets designated at fair value through profit or loss.

For the equities included in this category, which are not quoted on an active market, the cost approach is used as the estimate of fair value only on a residual basis and in a small number of circumstances, i.e., when all the measurement methods referred to above cannot be applied, or when there are a wide range of possible measurements of fair value, in which cost represents the most significant estimate.

Financial assets measured at fair value through other comprehensive income both in the form of debt securities and loans are subject to the verification of the significant increase in credit risk (impairment) required by IFRS 9, in the same way as Assets measured at amortized cost, with the consequent recognition through profit or loss of a value adjustment to cover the expected losses. More specifically, for instruments classified as stage 1 (i.e., financial assets at origination, when not impaired, and instruments for which there has not been a significant increase in credit risk since the initial recognition date), a 12-month expected loss is recognized on the initial recognition date and at each subsequent reporting date. For instruments classified as stage 2 (performing for which there has been a significant increase in credit risk since the initial recognition date) and as stage 3 (credit-impaired exposures), a lifetime expected loss for the financial instrument is recognized. Equity instruments are not subject to the impairment process.

Financial assets are derecognized solely if the sale leads to the substantial transfer of all the risks and rewards connected to the assets. Conversely, if a significant part of the risks and rewards relative to the sold financial assets is maintained, they continue to be recorded in financial statements, even though their title has been transferred. When it is not possible to ascertain the substantial transfer of risks and rewards, the financial assets are derecognized where no control over the assets has been maintained. If this is not the case, when control, even partial, is maintained, lvement, measured by the exposure to changes in value of assets disposed and to variations in the relevant cash flows. Lastly, financial assets sold are derecognized if the entity retains the contractual rights to receive the cash flows of the asset, but signs a simultaneous obligation to pay such cash flows, and only such cash flows, without significant delay to third parties.

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2. Financial assets measured at amortized cost

This category includes the financial assets (in particular loans and debt securities) that meet both the following conditions:  the financial asset is held under a business model whose objective is achieved through the collection of expected contractual cash flows (Hold to Collect business model), and  the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments

More specifically, the following are recognized in this caption:  loans to banks in their various forms that meet the requirements referred to in the paragraph above;  loans to customers in their various forms that meet the requirements referred to in the paragraph above;  debt securities that meet the requirements referred to in the paragraph above.

This category also includes the operating loans and receivables connected to the provision of financial activities and services as defined by the Consolidated Law on Banking and the Consolidated Law on Finance (e.g. for the distribution of financial products and servicing activities). According to the general rules established by IFRS 9 on the reclassification of financial assets, reclassifications to other categories of financial assets are not permitted unless the entity changes its business model for those financial assets. In such cases, which are expected to be highly infrequent, the financial assets may be reclassified from the amortized cost category to one of the other two categories established by IFRS 9 (Financial assets measured at fair value through other comprehensive income or Financial assets measured at fair value through profit or loss). The transfer value is the fair value at the time of the reclassification and the effects of the reclassification apply prospectively from the reclassification date. Gains and losses resulting from the difference between the amortized cost of a financial asset and its fair value are recognized through profit or loss in the event of reclassification to Financial assets measured at fair value through profit or loss measured at fair value through other comprehensive income.

Initial recognition of the financial asset occurs at settlement date for debt securities and at disbursement date for loans. On initial recognition, assets are recorded at fair value, including transaction costs and revenues directly attributable to the instrument. In particular, for loans, the disbursement date is usually the same as the date of signing of the contract. Should this not be the case, a commitment to disburse funds is made along the subscription of the contract, which will cease to exist upon disbursement of the loan. The loan is recognized based on its fair value, equal to the amount disbursed or subscription price, inclusive of the costs/revenues directly attributable to the single loan and determinable from inception, even when settled at a later date. Costs that, even with the aforementioned characteristics, are reimbursed by the borrower or are classifiable as normal internal administrative costs are excluded.

After the initial recognition, these financial assets are measured at amortized cost, using the effective interest method. The assets are recognized in the balance sheet at an amount equal to their initial carrying amount less principal repayments, plus or minus the cumulative amortization (calculated using the effective interest rate method referred to above) of the difference between this initial amount and the amount at maturity (typically attributable to costs/income directly attributable to the individual asset) and adjusted by any provision for losses. The effective interest rate is the rate that exactly discounts estimated future cash payments of the asset, as principal and interest,

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to the amount disbursed inclusive of the costs/revenues attributable to that financial asset. This measurement method uses a financial approach and allows distribution of the economic effect of the costs/income directly attributable to a financial asset over its expected lifetime. The amortized cost method is not used for assets, measured at historical cost, whose short duration makes the effect of discounting negligible, or for assets without a definite maturity or revocable loans. The measurement criteria are closely linked to the inclusion of these instruments in one of the three stages of credit risk established by IFRS 9, the last of which (stage 3) consists of non-performing financial assets and the remaining (stages 1 and 2) of performing financial assets. With regard to the accounting representation of the above measurement effects, the value adjustments for this type of asset are recognized in profit or loss:  on initial recognition, for an amount equal to the 12-month expected credit loss;  on subsequent measurement of the asset, when the credit risk has not increased significantly since initial recognition, in relation to changes in the amount of adjustments for the 12-month expected credit losses;  on subsequent measurement of the asset, when the credit risk has increased significantly since initial recognition, in relation to the recognition of adjustments for expected credit losses over the contractually agreed remaining lifetime of the asset;  on subsequent measurement of the asset, where after a significant increase in credit risk has occurred since initial recognition ignment of the cumulative value adjustments to take account of the change from a lifetime expected credit loss to a 12-month expected credit loss for the instrument. If, in addition to a significant increase in credit risk, there is also objective evidence of impairment, the amount of the loss is measured as the difference between the carrying amount of the asset - the other relationships with the same counterparty and the present value of the estimated future cash flows, discounted using the original effective interest rate. The amount of the loss, to be recognized through profit or loss, is established based on individual measurement or determined according to uniform categories and, then, individually allocated to each position, and, takes account of forward-looking information and possible alternative recovery scenarios. Non-performing assets include financial assets classified as bad, unlikely-to-pay or past due by over ninety days according to the rules issued by the Bank of Italy, in line with the IAS/IFRS and EU Supervisory Regulations. The expected cash flows take into account the expected recovery times and the estimated realizable value of any guarantees. The original effective rate of each asset remains unchanged over time even if the relationship has been restructured with a variation of the contractual interest rate and even if the relationship, in practice, no longer bears contractual interest. If the reasons for impairment are no longer applicable following an event subsequent to the registration of impairment, recoveries are recorded in the income statement. The size of the recovery must not lead the carrying value of the financial asset to exceed the amortized cost had no impairment losses been recognized in previous periods. Recoveries on impairment with time value effects are recognized in net interest income. In some cases, during the lifetime of these financial assets, and of loans in particular, the original contractual conditions may be subsequently modified by the parties to the contract. When the contractual clauses are subject to change during the lifetime of an instrument, it is necessary to verify whether the original asset should continue to be recognized in the balance sheet or whether, instead, the original instrument needs to be derecognized and a new financial instrument needs to be recognized. In general, changes to a financial asset lead to its derecognition and the recognition of a new asset when they are

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3. Hedging transaction

Hedging transactions are intended to offset potential losses/gains on a specific item or group of items, attributable to a specific risk, through the gains/losses generated on another instrument or group of instruments in the event that the specific risk in question materializes. The FCA Bank Group hedges its exposure to the interest rate risk associated with receivables arising from instalment loans and bonds issued at fixed interest rates with derivatives designated as fair value hedges. Derivatives entered into to hedge the variable interest rate risk associated with the debt of the companies engaged in long-term rental are designated as cash flow hedges. Only derivatives entered into with a counterparty not belonging to the group may be treated as hedging instruments.

Hedging derivatives are stated at fair value. Specifically:  in the case of cash flow hedges, derivatives are recognized at their fair value. Any change in the fair value of the effective part of the hedge is recognized through OCI, value of the ineffective part of the hedge is recognized through profit or loss in item 90.  in the case of fair value hedges, any change in the fair value of the hedging instrument is recognized through profit

the risk hedged with the derivative instrument, is recognized through profit and loss as an offsetting entry of the change in the carrying amount of the hedged item.

The fair value of derivative instruments is calculated on the basis of interest and exchange rates quoted in the market, f the future cash flows generated by the individual contracts.

A derivative contract is designated for hedging activities if there is a formal document of the relationship between the hedged instrument and the hedging instrument and whether the hedge is effective since inception and, prospectively, throughout its life.

A hedge is effective (in a range between 80% and 125%) when the changes in the fair value (or cash flows) of the hedging financial instrument almost entirely offset the changes in hedged item with regard to the risk being hedged.

Effectiveness is assessed at every year-end or interim reporting date by using:  prospective tests, to demonstrate an expectation of effectiveness in order to qualify for hedge accounting;  retrospective tests, to ensure that the hedging relationship has been highly effective throughout the reporting period, measuring the extent to which the achieved hedge deviates from a perfect hedge.

If the tests fail to demonstrate hedge effectiveness, hedge accounting, as indicated above, is discontinued and the derivative contract is reclassified to held-for-trading financial assets or financial liabilities and is therefore measured in a manner consistent with its classification. In case of macro hedging, IAS 39 permits the establishment of a fair value hedge for the interest rate risk exposure of a designated amount of financial assets or liabilities so that a group of derivative contracts can be used to offset the changes in fair value of the hedged items as interest rates vary.

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Macro hedges cannot be applied to a net position being the difference between financial assets and liabilities. Macro hedging is considered highly effective if, like fair value hedges, at inception and in subsequent periods the changes in fair value of the hedged amount are offset by the changes in fair value of the hedging derivatives in the range of 80% to 125%.

4. Investments

Investments in joint ventures (IFRS 11) as well as in companies subject to significant influence (IAS 28) are recognized with the equity method. Under the equity method, the investment in an associate or a joint venture is initially recognized at cost. If there is any evidence that the value of an investment has been impaired, the recoverable value of the investment is estimated, taking account the present value of the future cash flows that it will generate, including its disposal value. If the recovery value is lower than book value, the difference is recorded in the income statement. In subsequent periods, if the reasons for the impairment cease to exist, the original value may be restored through the income statement

5. Property, plant and equipment

This item includes furniture, fixtures, technical and other equipment and assets related to the leasing business. The item also includes the rights of use acquired with leasing pursuant to IFRS 16. These tangible assets are used to provide goods and services, to be leased to third parties, or for administrative purposes and are expected to be utilized for more than one period. This item consists of:  assets for use in production  assets held for investment purposes.

Assets held for use in production are utilized to provide goods and services as well as for administrative purposes and are expected to be used for more than one period. Typically, this category includes also assets held to be leased under leasing arrangements. This item includes also assets provided by the group in its capacity as lessor operating lease agreements. Assets leased out include vehicles provided under operating lease agreements by the g -term car rental companies. Trade receivables to be collected in connection with recovery procedures in relation to operating leases

Tangible assets comprise also leasehold improvements, whenever such expenses are value accretive in relation to identifiable and separable assets. In this case, classification takes place in the specific sub-items of reference in relation to the asset. Asset held for investment purposes refer to investment property as per IAS 40, i.e. properties held (owned or under a finance lease) in order to receive rental income and/or an appreciation of the invested capital. Tangible assets are initially recognized at cost, inclusive of purchase price and all the incidental charges incurred directly to purchase and to put the asset in service. Costs incurred after purchase are only capitalized if they lead to

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an increase in the future economic benefits deriving from the asset to which they relate. All other costs are recorded in the income statement as incurred. Subsequently, tangible assets are recognized at cost, less accumulated depreciation and impairment losses. Depreciation is calculated on a straight line basis considering the remaining useful life and value of the asset. At every reporting date, if there is any evidence that an asset might be impaired, the book value of the asset is compared with its realizable value equal to the greater of fair value, net of any selling costs, and the value in use of the asset, defined as the net present value of future cash flows generated by the asset. Any impairment losses

If the reasons that gave rise to the impairment no longer apply, then the loss is reversed for the amount that would restore the asset to the value that it would have had in the absence of any impairment, less accumulated depreciation.

Initial direct costs incurred in the negotiation and execution of an operating agreement are added to the leased assets in equal instalments, based on the length of the agreement. Tangible assets are derecognized upon disposal or when they are retired from production and no further economic benefits are expected from them. Any difference between the selling price or realizable value and the carrying

6. Intangible assets

Intangible assets are non-monetary long-term assets, identifiable even though they are intangible, controlled by the group and which are likely to generate future economic benefits. Intangible assets include mainly goodwill, software, trademarks and patents. Goodwill arising in a business combination is initially measured at cost (being the excess of the aggregate of the consideration transferred and the amount recognized for non-controlling interests) and any previous interest held over the fair value of net identifiable assets acquired and liabilities assumed. In the case of software generated internally the costs incurred to develop the project are recognized as intangible assets provided that the following conditions are met: technical feasibility, intention to complete, future usefulness, availability of sufficient technical and financial resources and the ability to measure reliably the costs of the project. Intangible assets are recognized if they are identifiable and originated from legal or contractual rights. Intangible assets purchased separately and/or generated internally are initially recognized a cost and, except for goodwill, are amortized on a straight line basis over their remaining useful life. Subsequently, they are measured at cost net of accumulated amortization and any accumulated impairment losses. The useful life of intangible assets is either definite or indefinite.

Definite-life intangibles are amortized over their remaining useful life and are tested for impairment every time there is objective evidence of a possible loss of value. The amortization period of a definite-life intangible asset is reviewed at least once every year, at year end. Changes in the useful life in which the future economic benefits related to the asset will materialize result in changes in the amortization period and are considered as changes in estimates. The amortization of definite-life intangible asset is recognized in the income statement in the cost category consistent with the function of the intangible asset. Any adjustments are recognized in the income statement, item 220. " Amortisation/Impairment on intangible assets". Indefinite-life intangible assets, including goodwill, are not amortized but are tested every year for impairment both individually and at the level of cash generating units. Every year (or whenever there is evidence of impairment)

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goodwill is tested for impairment. To this end, the cash generating unit to which goodwill is to be attributed is identified. The amount of any impairment is calculated as the difference between the carrying amount of goodwill and its recoverable value, if lower. Recoverable value is equal to the greater of the fair value of the cash generating unit, less any selling costs, and the relevant value in use. Any adjustments are recognized in the income statement, i

Intangible assets are derecognized upon disposal or when and no further economic benefits are expected from them. Any difference between the selling price or realizable value and the carrying amount is recognized through

7. Current and deferred taxation

bility side. In accordance with the balance sheet method, current and deferred taxes are accounted for as follows:  current tax assets, that is payments in excess of taxes due under applicable national tax laws;  current tax liabilities, or taxes payable under applicable national tax laws;  deferred tax assets, that is income taxes recoverable in future years and related to:  deductible timing differences;  unused tax loss carry-forwards; and  unused tax credits carried forward;  deferred tax liabilities, that is income tax amounts payable in future years due to the excess of income over taxable income due to timing differences. Current and deferred tax assets and liabilities are calculated by applying national tax laws in force and are accounted for as an expense (income) in accordance with the same accrual basis of accounting applicable to the costs and revenues that generated them. Generally, deferred tax assets and liabilities arise in the cases where the deductibility of a cost or the taxability of a revenue is deferred with respect to their recognition. Deferred tax assets and liabilities are recognized on the basis of the tax rates that, at the balance sheet date, are expected to be applicable in the year in which the asset will be realized or the liability extinguished, on the basis of the tax legislation in force, and are periodically revised to take account of any change in legislation. Deferred tax assets are recognized, to the extent that they can be recovered against future income. In accordance with IAS 12, the probability that there is sufficient taxable income in future should be verified from time to time. If the analysis reveals that there is no sufficient future income, the deferred tax assets are reduced accordingly. Curre with the exception of those taxes related to items recognized, in the current or in another year, directly through equity, such as those related to gains or losses on available-for-sale financial assets and those related to changes in the fair value of cash flow hedges, whose changes in value are recognized, on an after-tax basis, directly in the

Current tax assets are shown in the balance sheet net of current tax liabilities whenever the following conditions are met:  existence of an enforceable right to offset the amounts recognized;

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 the parties intend to settle the assets and liabilities in a single payment on a net basis or to realize he asset and simultaneously extinguish the liability. Deferred tax assets are reported in the Statement of financial position net of deferred tax liabilities whenever the following conditions are met:  existence of a right to offset the underlying current tax assets with current tax liabilities; and  both deferred tax assets and liabilities relate to income taxes applied by the same tax jurisdiction on the same taxable entity or on different taxable entities that intend to settle the current tax assets and liabilities on net basis (typically in the presence of a tax consolidation agreement).

8. Provisions for risks and charges

Post-employment benefits and similar obligations Post-employment benefits are established in accordance with labor agreements and are qualified as defined-benefit plans. Obligations associated with employee defined-benefit plans and the relevant pension costs associated to current employment are recognized based on actuarial estimates by applying he projected unit credit method. Actuarial gains/losses resulting from the valuation of the liabilities of the defined-benefit plan are recognized through Other -measurements are not reclassified to profit or loss

The discount rate used to calculate the present value of the obligations associated with post-employment benefits changes depending on the country/currency in which the liability is denominated and is set on the basis of yields, at the balance sheet date, of bonds issued by prime corporates with an average maturity consistent with that of the liability. Net interest is calculated by applying the discount rate to the net defined benefit liability or

Other provisions Other provisions for risks and charges relate to costs and charges of a specified nature and existence certain or probable but whose amount or date of payment is uncertain on the balance sheet date. Provisions for risks and charges are made solely whenever: a) there is a current (legal or constructive) obligation as a result of a past event; b) fulfilment of this obligation is likely to be onerous; c) the amount of the liability can be reliably estimated. When the time value of money is significant, the amount of a provision is calculated as the present value of the expenses that will supposedly be incurred to extinguish the obligation. This item includes also long-term benefits to employees whose expenses are determined with the same actuarial criteria as those of the defined-benefit plans. Actuarial gains or losses are all recognized as incurred through profit or loss.

9. Financial liabilities at amortised cost

The items Deposits from banks, Deposits from customers and Debt securities in issue include the financial instruments (other than financial liabilities held for trading and recognized at their fair value) issued to raise funds

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from external sources. In particular, debt securities in issue reflect bonds issued by group companies and securities issued by the SPEs in relation to receivable securitization transactions.

These financial liabilities are recognized on the date of settlement at fair value, which is normally the amount collected or the issue price, less any transaction costs directly attributable to the financial liability. Subsequently, these instruments are recognized at their amortized cost, on the basis of the effective interest method. The only exception is short-term liabilities, as the time value of money is negligible, which continue to be recognized on the basis of the amount collected.

Financial liabilities are derecognized when they reach maturity or are extinguished. Derecognition takes place also in the presence of a buyback of previously issued securities. The difference between the carrying amount of the

10. Financial liabilities held for trading

Financial liabilities held for trading include mainly derivative contracts that are not designated as hedging instruments. These financial liabilities are recognized initially at their fair value initially and subsequently until they are extinguished, with the exception of derivative contracts to be settled with the delivery of an unlisted equity instrument whose fair value cannot be determined reliably and that, as such, are recognized at cost.

11. Insurance assets and liabilities

IFRS 4 defines insurance contracts as contracts under which one party (the insurer) accepts significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder (or a party designated by the policyholder) if a specified uncertain future event (the insured event) adversely affects the policyholder. The g -life insurance policies sold by insurance companies to customers of consumer credit companies to protect the payment of the debt. The items described below reflect, as prescribed by paragraph 2 of IFRS 4, the operating and financial effects deriving from the reinsurance contracts issued and held. In essence the accounting treatment of such products calls for the recognition:  the premiums, which include the premiums written for the year following the issue of contracts, net of cancellations; (ii) changes in technical provisions, reflecting the variation in future obligations toward policyholders arising from insurance contracts; (iii) commissions for the year due to intermediaries; (iv) cost of claims, redemptions and expirations for the period;  in individually for every contract with the prospective method, on the basis of demographic/financial assumptions currently used by the industry;  in

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12. Other information

Employee Severance Fund The FCA Bank Group has established different defined-benefit and defined-contribution pension plans, in line with the conditions and practices in the countries in which it carries out its activities. -  - rued to employees as of 1 January 2007 (effective date of Legislative Decree no. 252 on the reform of supplementary pension funds), both in case the employee exercised the option to allocate the sums attributable to him/her to supplementary pension funds and in case the employee

personnel expenses is determine on the basis of the contributions due without applying actuarial calculation methods;  ned- unit method, for the severance amounts accrued until 31 December 2006. These amounts are recognized on the basis of their actuarial value as determined by using the projected credit unit method. To discount these amounts to present value, the discount rate was determined on the basis of yields of bonds issued by prime corporates taking into account the average remaining duration of the liability, as weighted by the percentage of any payment and advance payment, for each payment date, in relation to the total amount to be paid and paid in advance until the full amount of the liability is extinguished. Costs related to the employee severance fund are recognized in the income statement, item no. 190.a) -benefit plan (i) service costs related to companies with less than 50 employees; (ii) interest cost accrued for the year, for the defined-contribution part; (iii) the severance amounts accrued in the year and credited to either the pension funds

On the s nce of the fund exiting at December 31, 2006, minus any payment made until June 30, 2020 the reporting date relating to the severance amounts payable to pension Actuarial gains and losses, reflecting the difference between the carrying amount of the liability and the present value of the obligation at year-end, are recognized through equity in the Valuation reserve, in accordance with IAS 19 Revised.

Revenue recognition that the economic benefits associated with the transaction will flow to the Company and the amount can be reliably quantified. In particular, for all financial instruments measured at amortized cost, such as loans and receivables to customers and banks, and interest-bearing financial assets classified as AFS, interest income is recorded using the effect Commissions receivable upon execution of a significant act or upon the rendering of a service are recognized as revenue when the significant act has been completed or when the services are provided. On the other hand, commissions related to origination fees received by the entity relating to the creation or acquisition of a financial asset are deferred and recognized as an adjustment to the effective rate of interest. Revenues from services are recognized when the services are rendered.

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Dividends are recognized in the year in which their distribution is approved.

Cost recognition Costs are recognized as they are incurred. Costs attributable directly to financial instruments measured at amortized cost and determinable since inception, regardless of when the relevant outlays take place, flow to the income statement via application of the effective interest rate. Impairment losses are recognized as incurred.

Finance leases Lease transactions are accounted for in accordance with IAS 17. In particular, recognition of a lease agreement as a lease transaction is based on the substance that the agreement on the use of one or more specific assets and whether the agreement transfers the right to use such asset. A lease is a finance lease if it transfers all the risks and benefits incidental to ownership of the leased asset; if it does not, then a lease is an operating lease. For finance lease agreements where the FCA Bank Group acts as lessor, the assets provided under finance lease arrangements are reported as a receivable in the statement of financial position for a carrying amount equal to the net investment in the leased asset. All the interest payments are recognized as interest income (finance component in lease payments) in the income statement while the part of the lease payment relating to the return of principal reduce the value of the receivable.

Foreign currency transactions Foreign currency transactions are entered, upon initial recognition, in the reference currency by applying to the foreign currency amount the exchange rate prevailing on the transaction date. At every interim and year-end reporting date, items originated in a foreign currency are reported as follows:  cash and monetary items are converted at the exchange rate prevailing at the reporting date;  non-monetary items, recognized at historical cost, are converted at the exchange rate prevailing on the date of the transaction;  non-monetary items, recognized at fair value, are converted at the exchange rate prevailing at the reporting date.

Exchange rate differences arising from the settlement of monetary items and the conversion of monetary items at the income statement as incurred. When a gain or a loss related to a non-monetary item is recognized through OCI, the exchange rate difference related to such item is also recognized through OCI. By converse, when a gain or a loss is recognized through profit or loss, the exchange rate difference related to such item is also recognized through profit or loss.

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Use of estimates Financial reporting requires use of estimates and assumptions which might determine significant effects on the amounts reported in the Statement of financial position and in the income statement, as well as the disclosure of contingent assets and liabilities. The preparation of these estimates implies the use of the information available and subjective assessments, based on historical experience, used to make reasonable assumptions to record the transactions. By their nature the estimates and assumptions used may vary from one year to the next and, as such, so may the carrying amounts in the following years, significantly as well, as a result of changes in the subjective assessments made. The main cases where subjective assessments are required include:  quantification of losses on loans and receivables, investments and, in general, on financial assets;  evaluation of the recoverability of goodwill and other intangible assets;  quantification of employee provisions and provisions for risks and charges;  estimates and assumptions on the recoverability of deferred tax assets.

The estimates and assumptions used are periodically and regularly updated by the group. Variations in actual circumstances could require that those estimates and assumptions are subsequently adjusted. The impacts of any changes in estimates and assumptions are recognized directly in profit or loss in the period in which the estimates are revised, if the revision impacts only that period, or also in future periods, if the revision impacts both the current and future periods. Following are the key considerations and assumptions made by management in applying IFRS and that could have a significant impact on the amounts recognized in the consolidated financial statements or where there is significant risk of a material adjustment to the carrying amounts of assets and liabilities during a subsequent financial period.

 Recoverability of deferred tax assets The FCA Bank Group had deferred tax assets on deductible temporary differences and theoretical tax benefits arising from tax loss carryforwards. The group has recorded this amount because it believes that it is likely to be recovered. In determining this amount, management has taken into consideration figures from budgets and forecasts consistent with those used for impairment testing and discussed in the preceding paragraph on the recoverable amount of non-current assets. Moreover, the contra accounts that have been recognized (i.e. deferred tax assets not recognized to the extent that it is not probable that taxable profit will be available against which the unused tax losses or unused tax credits can be utilized) are considered to be sufficient to protect against the risk of a further deterioration of the assumptions in these forecasts, taking account of the fact that the net deferred assets so recognized relate to temporary differences and tax losses which, to a significant extent, may be recovered over a very long period, and are therefore consistent with a situation in which the time needed to exit from the crisis and for an economic recovery to occur extends beyond the horizon implicit in the abovementioned estimates.

 Pension plans and other post-employment benefits Employee benefit liabilities with the related assets, costs and net interest expense are measured on an actuarial basis, which requires the use of estimates and assumptions to determine the net liabilities or net assets. The actuarial method takes into consideration parameters of a financial nature such as the discount rate and the expected long term rate of return on plan assets, the growth rate of salaries as well as the likelihood of potential future events by using demographic assumptions such as mortality rates, dismissal or retirement rates.

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In particular, the discount rates selected are based on yields curves of high quality corporate bonds in the relevant market. The expected returns on plan assets are determined considering various inputs from a range of advisors concerning long-term capital market returns, inflation, current bond yields and other variables, adjusted for any specific aspects of the asset investment strategy. Salary growth rates reflect the g -term actual expectation in the reference market and inflation trends. Changes in any of these assumptions may have an effect on future contributions to the plans.

 Contingent liabilities The group makes provisions for pending disputes and legal proceedings when it is considered probable that there will be an outflow of funds and when the amount of the losses arising therefrom can be reasonably estimated. If an outflow of funds becomes possible but the amount cannot be estimated, the matter is disclosed in the notes. The group is the subject of legal and tax proceedings covering a range of matters which are pending in various jurisdictions. Due to the uncertainty inherent in such matters, it is difficult to predict the outflow of funds which will result from such disputes. Moreover, the cases and claims against the group often derive from complex and difficult legal issues which are subject to a different degree of uncertainty, including the facts and circumstances of each particular case, the jurisdiction and the different laws involved. In the normal course of business the group monitors the stage of pending legal procedures and consults with legal counsel and experts on legal and tax matters. It is therefore possible that the provisions for the g developments of the proceedings under way.

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INFORMATION ON TRANSFER BETWEEN PORTFOLIOS OF FINANCIAL ASSETS

During the period no inter-portfolio transfers were made.

INFORMATION ON FAIR VALUE

The disclosure on the change in fair value required by IFRS 13 applies to financial instruments and non-financial assets and liabilities that are measured at fair value, on a recurring or non-recurring basis. This standard calls for fair value to be determined in accordance with a three-level hierarchy based on the significance of the inputs used in such measurement. The three levels are as follows:  Level 1 (L1): quoted prices (without adjustments) in an active market as defined by IFRS 13 for the assets and liabilities to be measured;  Level 2 (L2): inputs other than quoted market prices included within Level 1 that are observable either directly (prices) or indirectly (derived from prices) in the market;  Level 3 (L3): inputs that are not based on observable market data.

The methods adopted by the Company to determine fair value are illustrated below. Financial instruments, classified (L1), whose fair value is represented by the market value (instruments listed on an active market) refer to:  Austrian government bonds purchased by the Austrian subsidiary, quoted in regulated markets (caption: inancial assets designated at fair value with effects on comprehensive income );  bonds issued by FCA Bank S.p.A and the subsidiaries in Ireland and Switzerland under the Euro Medium Term Notes programme and listed in regulated markets (Caption: ies valued at amortized cost c) D );  bonds issued in connection with securitization transactions, placed with the public or with private investors, by different group entities (Caption: Financial liabilities valued at amortized cost c) Debt certificates including ).

For listed bonds issued in connection with securitization transactions, reference to prices quoted by Bloomberg. Financial assets and liabilities classified as (L2), whose fair value is determined by using inputs other than quoted market prices that are observable either directly (prices) or indirectly (derived from prices) in the market, refer to:  OTC trading derivatives to hedge securitization transactions;  OTC derivatives entered into to hedge gr

Receivable portfolio (Caption 40: Financial assets valued at amortized cost Loans and receivables with customers issued bonds, not quoted, are classified in L3. Derivatives are measured by discounting their cash flows at the rates plotted on the yield curves provided by Bloomberg. Receivables and payables are measured in the same way. In accordance with IFRS 13, to determine fair value, the FCA Bank Group considers default risk, which includes changes in the creditworthiness of the entity and its counterparties.

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In particular:  a CVA (Credit Value Adjustment) is a negative amount that takes into account scenarios in which the counterparty fails before the company and the company has a positive exposure to the counterparty. Under these scenarios, the company incurs a loss equal to the replacement value of the derivative;  a DVA (Debt Value Adjustment) is a positive amount that takes into account scenarios in which the company fails before the counterparty and the company has a negative exposure to the counterparty. Under these scenarios, the company obtains a gain for an amount equal to the replacement cost of the derivative.

The valuation of the Debt securities in issue is taken from the prices published on Bloomberg. For listed and unlisted securities, reference is made to listed prices, taking equivalent transactions as reference. For listed bonds issued in connection with private securitization transactions, reference is provided by prime banks active in the market taking as reference equivalent transactions, or made to the nominal value of the bonds or the fair value attributed by the banking counterparty that subscribed to them. The group uses measurement methods (mark to model) in line with those generally accepted and used by the market. Valuation models are based on the discount of future cash flows and the estimation of volatility; they are reviewed both when they are developed and from time to time, to ensure that they are fully consistent with the objectives of the valuation.

These methods use inputs based on prices prevailing in recent transactions on the instrument being measured and/or prices/quotations of instruments with similar characteristics in terms of risk profile.

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A.4.5 FAIR VALUE HIERARCHY

A.4.5.1 Assets and liabilities measured at fair value on a recurring basis: breakdown by fair value levels 30/06/2020 31/12/2019 Assets and liabilities valued at fair value L1 L2 L3 L1 L2 L3 1. Financial assets valued at fair value with impact on - - - income statement of which - - -

a) Financial assets held for trading ------

b) Financial assets designated at fair value ------c) Other financial assets compulsorily assessed at fair - - - value - - - 2. Financial assets valued at fair value with impact on 9,807 - - overall profitability 9,869 -

3. Hedging derivatives 34,644 - 36,930 - - -

4. Property, plan and equipment ------

5. Intangible assets ------

Total 34,644 9,807 36,930 0 9,869 -

1. Financial liabilities held for trading 2,388 - 3,407 - - -

2. Financial liabilities designated at fair value - - -

3. Hedging derivatives 98,458 91,533 - - Total - 100,846 - 0 94,940 0

L1 = Level 1 L2 = Level 2 L3 = Level 3

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A.4.5.4 Assets and liabilities not measured at fair value or measured at fair value on a non-recurring basis: breakdown by fair value levels

Assets / Liabilities not 30/06/2020 31/12/2019 measured at fair value or measured at fair value on BV L1 L2 L3 BV L1 L2 L3 a non-recurring basis 1. Financial assets valued at amortized cost 23,983,859 - 2,284,857 21,771,947 25,903,033 - 1,997,960 23,953,234 2. Property, plant and equipment held for ------investment 3. Non-current assets and disposal groups classified as - - - - held for sale

Total 23,983,859 - 2,284,857 21,771,947 25,903,033 - 1,997,960 23,953,234 1. Financial liabilities measured at amortized cost 25,044,303 8,568,752 16,893,922 26,933,628 9,439,872 18,318,466 2. Liabilities associated with assets classified as held for ------sale

Total 25,044,303 8,568,752 - 1 6,893,922 26,933,628 9,439,872 - 18,318,466

BV = Book Value L1 = Level 1 L2 = Level 2 L3 = Level 3

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BUSINESS COMBINATIONS

Business combinations completed in the period

On May 15, 2020 Leasys acquired full ownership of Aixia Developpement S.A.S., a company engaged in short-term -time consolidation, a goodwill on a provisional basis, pending completion of the PPA process. On the acquisition date Aixia Developpement S.A.S. had the following wholly-owned subsidiaries: Aixia Systemes SAS, Aixia Location SAS and Rent All SAS. This acquisition is part of a broader geographic growth strategy, which aims to thrust Leasys into a leadership position in European mobility services.

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RELATED-PARTY TRANSACTIONS

Information on related-party transactions

Typically, related- ny transactions are carried out only after the mutual benefits of the parties involved are considered. In preparing the consolidated half year report, balances arising from intercompany transactions are eliminated.

The table below shows assets, liabilities, costs and revenues at June 30, 2020 by type of related party.

Transactions with related parties: balance sheet

AMOUNTS AT 30/06/2020

OTHER RELATED SHAREHOLDERS TOTAL PARTIES

Financial assets at fv with effects on P&L - - -

- Financial assets held for trading - - -

Financial assets valued at amortized cost 5,374 84,741 90,115

- Loans and receivables with banks 4,931 5,541 10,472

- Loans and receivables with Customers 443 79,200 79,643

Hedging derivatives - 16,949 16,949

Other assets 310,186 54,362 364,548 Total Assets 315,559 156,052 471,611

Financial liabilities valued at amortized cost 2,938,771 1,255,815 4,194,586

- Deposits from banks 2,938,771 1,164,082 4,102,853

- Deposits from customers - 91,733 91,733

Financial liabilities held for trading - 2,038 2,038

Hedging derivatives - 12,335 12,335

Other liabilities 57,211 129,389 186,600 Total Liabilities 2,995,982 1,399,577 4,395,559

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Transactions with related parties: income statement

AMOUNTS AT 30/06/2020

OTHER RELATED SHAREHOLDERS TOTAL PARTIES

Interest and similar income 45,722 31,153 76,876

Interest and similar expense (12,040) (14,365) (26,405)

Fee and commission income 1,648 13,965 15,613

Fee and commission expense (1,052) (8,673) (9,725)

Administrative expenses (1,942) (4,961) (7,082)

Other operating income/expenses 18,258 39,704 57,962

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SEGMENT REPORTING AS AT JUNE 30, 2020

Assets and performance by segment

Asset and performance figures by segment are shown in accordance with IFRS 8 Operating Segments, with the

The FCA Bank Group operates through three operating segments: Retail, Dealer Financing and Rental. Segment assets (accurate amounts) consist solely of receivables due from customers. At the end of the first half of 2020, the Retail segment had total assets of euro 16.2 billion, a slight decrease of 4% compared to December 31, 2019, while the Wholesale decreased by 20% on the comparable amount at December 31, 2019, settling at euro 5.7 billion. Rental assets, for their part, increased by 4% on December 31, 2019, reaching euro 3.6 billion. As required by IFRS 8, it is noted that the g management report is prepared which breaks down performance by foreign geographical area.

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WHOLESALE RETAIL RENTAL OTHER TOTAL FINANCING 30/06/2020 30/06/2020 30/06/2020 30/06/2020 30/06/2020 Net banking income and rental margin 327 75 85 487 Net operating expenses (86) (8) (40) (133) Cost of risk (44) 11 (7) (40) Other net operating income (14) (2) 3 (13) Profit before tax 183 76 41 - 300 Unallocated taxes - - - (75) (75) Net profit 183 76 41 (75) 225

Data as at 30/06/2020 Assets - - - - - End of period segment assets 16,252 5,687 3,640 - 25,578 Average segment assets 16,463 6,527 3,272 - 26,262 Unallocated assets - - - - -

WHOLESALE SEGMENT RETAIL RENTAL OTHER TOTAL FINANCING 30/06/2019 30/06/2019 30/06/2019 30/06/2019 30/06/2019 Net banking income and rental margin 326 103 81 510 Net operating expenses (89) (19) (37) (145) Cost of risk (25) (4) (4) (33) Other net operating income (17) (2) 1 (18) Profit before tax 195 77 41 - 314 Unallocated taxes - - - (75) (75) Net profit 195 77 41 (75) 238

Data as at 31/12/2019 Assets End of period segment assets 16,889 7,142 3,508 - 27,539 Average segment assets 16,247 7,162 2,939 - 26,348 Unallocated assets - - - - -

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INDE

AS AT JUNE 30, 2020

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