CORPORATE SOCIAL RESPONSIBILITY

2013 CORPORATE SOCIAL RESPONSIBILITY CHAIRMAN’S MESSAGE 3 METHODOLOGICAL NOTE 5

THE IDENTITY OF THE GROUP 7 • The Carige Group at a glance 8 • History and its link with the territory 9 • Mission and core values 10 • 2014-2018 Business Plan 12 • The Group structure 13 • Geographical footprint and distribution network 15 CUSTOMERS COMMUNITY SHAREHOLDERS • Corporate Governance 18 • The internal control and risk management system 24 • 2013 Awards and prizes 28

ECONOMIC REPORT 29

• Financial Highlights 29 PAGE 36 PAGE 48 PAGE 57 • Value Added 31

SOCIAL REPORTING 34 EMPLOYEES SUPPLIERS ENVIRONMENT • Social Responsibility in Banca Carige 34 • Dialogue with stakeholders 34

ANNEXES • Tables and indicators 80 PAGE 61 PAGE 74 PAGE 76 • GRI-G3 Indicators 95 CHAIRMAN’S MESSAGE

In 2013 the Banca Carige Group embarked on a path Report. Today, more than ever before, Banca Carige of profound renewal which led to a real turning point considers this document not only as an obligation to in both the Group’s governance and management its stakeholders but also as a due response to their structure. Similarly to other players in the banking right for clear, transparent and complete information industry, the Bank has suffered the impact of the on the Group’s operations and key corporate economic crisis that has been particularly harsh on events. The Corporate Social Responsibility Report families and SMEs, i.e. the Bank’s traditional clients, is intended as a rigorous, thoughtful report on the and led to major changes, including regulatory Group’s choices and activities, whose impact on the reforms, in the financial markets. community and regions of operation is described and assessed. These issues, which became of the utmost urgency particularly in the second half of the year, led the It is precisely by assessing the interests of the new management to take important decisions Bank’s main stakeholders that we gain a broader to safeguard the assets and restore the financial understanding of the overall context, which confirms balance of the Group. the effectiveness of the path undertaken and strategies implemented by both the Management Strict and rigorous, yet unavoidable measures were and the Board of Directors. Within the framework of thus taken which, on the one hand, had a severe this document, capital strengthening (including via a impact on the operating income and, on the other, rights issue), which is the main pillar of the Group’s are the pre-requisites for re-launching a growth strategic plan, takes on a broader significance. process for the Bank. We can therefore affirm we have closed 2013 with a pledge of responsibility for The value it acquires in guaranteeing the Bank’s focusing on the future while aiming at preserving financial strength takes centre stage for our the business and safeguarding all those who work in customers, whom we have a fundamental -and for- this organisation. commitment to serve; for our employees and the safeguarding of their jobs; for our suppliers, who can Such a change of perspective, which allows us to rely on a stable relationship with us and for our local look to the years to come in a different light, is the communities, which benefit from the long-lasting background for this Corporate Social Responsibility presence of our credit institution in their areas. (1.1)

3 2014 opens with the presentation of the new 2014- This commitment does not intimidate us but is key asset of the Bank and the one reason why it 2018 Business Plan that marks the beginning of a rather welcomed as an opportunity which we are was founded and operates. I am thinking of our new phase of re-launch for the Group’s business. getting ready to seize via an in-depth review of the shareholders, customers, collaborators, suppliers The Plan reaffirms – as is worth highlighting in this Group’s structure, organisation and functions. Our and the community in general. We appeal to them message – that the values which inspired both the aim is to revise the Group’s governance and internal to share and face the challenge together. In the origin and the development of our Bank still hold control systems, boost the sales-force potential and future, their support will be ever more crucial for us true: support the areas of the Bank’s footprint via increase the Group’s productivity. The distribution to achieve the mission we have set before us, in the lending activities focused on the needs of families of our locally operating network will therefore be aim to enhance and enrich the human, social and and SMEs. re-organised and the head office structure will economic capital available so as to secure a peaceful be simplified, to align internal processes to the future to all of us and the society we live in. Our mission has roots plunging deep into our history, industry’s best practice. which is anything but antiquated and obsolete. Being a local bank nowadays requires the capability The development of our Business Plan focuses to respond to the fast-pace evolution that has particularly on human resources, as a key enabler changed both the face of our society as well as our for the success of the project. We intend to enhance household and business priorities. Therefore, one our workforce, especially our younger employees, of the priority objectives of the Business Plan is the by relieving their day-to-day operations from the (Cesare Castelbarco Albani) development of business models focusing on the most routine-based and bureaucratic activities. new needs of our customers. Innovation, multi- A streamlined structure will result in a natural channel services, service accessibility, efficient and turnover of personnel, with resources exiting upon effective response are the watchwords for boosting attainment of retirement eligibility requirements, customer loyalty and developing customer relations. opening the way to the recruitment of young The focus on service quality is, in fact, the distinctive employees. characteristic of Carige’s way of banking, which has been rewarded, year after year, by high customer The rationale inspiring our actions is to consider loyalty rates. today’s challenges as an incentive for us to attach renewed importance to a tradition that has so far To face the challenges raised by an increasingly proven to be rewarding for both the Bank and the competitive system, this mission needs to be pursued areas in which it operates: looking back to the past by safeguarding and enhancing revenues from the to build our future. Our history is the repository Bank’s core business, which is a prime condition of the strong values, reflective of our identity, for maintaining the high standards required by the which have allowed us to grow for 500 years. The globalized markets in which we operate. cornerstone of our mission will continue to be the individual, not as an abstract idea but in the concrete terms of all men and women who represent the

4 METHODOLOGICAL NOTE

This Report refers to the Carige Group management The most important issues in this document are: and adapted by Italian Banking Association (ABI) period from 1st January 2013 to 31st December 2013, concerning the determination and distribution of coherently with the Consolidated Balance Sheet (1); • customer-based relationship in relation to the Group’s value added. this is the 13th issue of the document and, compared the new strategic lines, with a view to a retail to the past, it shows some new features that will be positioning of the Group; As explained in the specific Chapter “Balances outlined below. With a view to its disclosure, this • product responsibility, transparency and adjustment of the prior period in accordance with document is published on Banca Carige’s website. customer satisfaction; IAS 8 (accounting policies, changes in accounting (3.1- 3.2- 3.3) • response to the economic and social needs of the estimates and errors)” in the Consolidated Balance territory, with a focus on supporting households Sheet – available in the “Investor relations” section The Reporting Process (3.5) and businesses affected by the economic crisis; on the website www.gruppocarige.it – some • personnel management and training policies. The Corporate Social Responsibility Unit, which comparative data related to the previous financial year and to the Balance Sheet as at 1st January reports directly to the Communication Direction, This document takes into consideration the banking co-ordinated data gathering and processing in 2012 have been restated in comparison with Group; any deviation will be, from time to time, those originally published; these amendments cooperation with various corporate structures. noted separately. This process aimed at identifying the strategic and are specifically referred to in some tables of this operational lines, together with the most significant The applied methodology document. (3.8-3.9-3.10-3.11) information related to social, environmental and The document structure economic performances. This document has been drawn up using as a reference the following standard templates related This document is structured as follows: Contents and Reporting (3.5–3.6–3.7-4.15) to social reporting: The identity of the Group. It describes the Group The main topics discussed in this document are those • GRI-G3 standard, appropriately adapted to the features, specifically referring to its strong presence considered the most significant by the Company. banking industry in accordance with Italian in the local socio- economic environment, as well as The choice of these topics has been effected taking Banking Association (ABI) guidelines; its coherence with the new strategic lines, in addition into account internal and external drivers, among • “Principles and drafting standards for social to the Corporate Governance aspects. which the Group’s mission and strategy, which were reporting” in accordance with Gruppo di Studio newly defined, as well as the expectations expressed per il Bilancio Sociale - GBS (Study Group for by the stakeholders. establishing the Social Reporting Standards)

(1) The document clearly details when the information have been updated after 31st December 2013

5 The Economic Report. It presents and analyses the most significant economic and financial results in the period, in addition to the determination and distribution of the value added generated by the Group.

The Social Report. Through a series of qualitative and quantitative indicators, it analyses the exchange relationships with each relevant stakeholder category. Improvement targets The following document reports on a period characterised by the launch of significant processes of change and review of structures, systems and strategic lines within the Group. As concerns Corporate Social Responsibility and its reporting, a process has been started, with the aim of ensuring a gradual compliance with the latest international standards. (3.12) With regard to the communications related to the sustainability commitment of the Group, a more and more exhaustive informative report will be available on the dedicated section of the website www. gruppocarige.it, which is currently subjected to a thorough review and implementation in terms of contents, user-friendliness and easiness of access. Further clarifications and information can be requested to: Banca Carige SpA e-mail [email protected] (3.4)

6 THE IDENTITY OF THE GROUP

• The Carige Group at a glance (2.6) • History and its link with the territory • Mission and core values FONDAZIONE CASSA DI RISPARMIO DI GENOVA E IMPERIA • 2014-2018 Business Plan 18.999% (1) • The Group structure BANCA • Geographical footprint and distribution network OTHER SHAREHOLDERS CARIGE • Corporate governance 71.012% (1) SpA • The internal control and risk management system BPCE IOM SA • 2013 Awards and prizes 9.989% (1)

With over five centuries of history, the Banca Carige The Group offers a wide range of products and services, both traditional and innovative, to meet the needs Group is currently one of Italy’s leading banking of its customers. groups, with an identity firmly rooted in a culture of proximity and time-honoured values, which is at the Banca Carige SpA - Cassa di Risparmio di Genova e Imperia (2.1) with headquarters in Genoa (2.4) is the same time strongly committed to responding flexibly parent company of the Carige Group, which operates in 13 Italian regions and in France with a branch in Nice; to the demands of a changing market and society. the public limited company was founded on 31st October 1991 and, in its banking activities, it is subject to the supervision of the Bank of Italy and to Italian laws and regulations. It has always been focused on providing top quality services in terms of reliability and flexibility and on (2.2) developing distribution channels to benefit households, SMEs, artisans, retailers and local government bodies, The banking activity mainly Life and non-life Financial activity: Trust services by using state-of-the-art technology. consists of: insurance leasing lending/funding, asset services factoring The Group has a significant presence in Italy, particularly management, securities consumer credit in the Liguria region, where it was founded and where and foreign exchange it hosts the historical headquarters of Genoa, and in Tuscany, Lombardy and Sicily, also thanks to the presence of its subsidiaries.

(1) Figures as at 10/06/2014 7 THE CARIGE GROUP AT A GLANCE (1) (2.8)

th 8 OVER Italian banking group for MILLION total assets and number 1.1 of branches BANKING CUSTOMERS th Approximately 93% 10 satisfied or very satisfied(*) POSITION for market BILLION DISTRIBUTION 47.9 capitalisation NETWORK: DIRECT AND INDIRECT FUNDING 678 traditional branches of which 795 ATMs 392 insurance agencies 38.7BILLION RETAIL 5,851 GROUP EMPLOYEES of which 27.6 5,385 BILLION BANK EMPLOYEES

LOANS TO CUSTOMERS

3,349 291,133 1,019 MILLION HRS SHARE CAPITAL of training supplied MILLION AND RESERVES NET INTEREST 5,889 AND OTHER BANKING SUPPLIERS INCOME 32% of them located in Liguria

(1) Figures as at 31/12/2013.

(*) Source: ABI Observatory / GFK Eurisko “Retail Customer Satisfaction”, May 2013 8 HISTORY AND ITS LINK WITH THE TERRITORY

The origins Banca Carige stems from the merger (in Genova e Imperia transferred its banking business 1929) of the ancient Monte di Pietà di Genova (1483) to the newly established Banca Carige S.p.A., Capital increases of over EUR 2 bn, together with and Cassa di Risparmio di Genova (1846). As a driving thus redefining the company purpose of Cassa di huge profit provisions to reserves, enabled to force of the economy in Liguria, Cassa di Risparmio Risparmio which became Fondazione Cassa di fund both an internal growth process, by opening di Genova backs and supports the major urban and Risparmio di Genova e Imperia. new branches, and an external one through the infrastructure interventions that have redesigned acquisition of banking and insurance companies as the look of the town as well as of its harbour. 1992-1994 well as branch networks. Between the 19th and 20th century, the banking Towards a universal bank A multipurpose group institution’s stable soundness and financial balance was set up anticipating the universal bank model, 1997-2010 allowed to support local banks experiencing which was introduced in Italy with the Legislative The Group’s growth After the liberalization of the financial difficulties. Against a background of Decree no. 385 dated 1st September 1993 and branch opening in 1989, the Bank launched an general vulnerability of the financial structures transposed by the Group in 1994, through the expansion plan primarily aimed at intensifying its and the growing industrial sector of united Italy merger by acquisition of the companies operating in presence in the traditional markets. Following this – for which Liguria later became a driving force of the medium and long term and in the para-banking measure, the expansion plan has been moving development – Cassa di Risparmio di Genova hence sector. towards new areas. In a first phase, the expansion plays a vital role in protecting investments and took place in Northern Italy, especially in those savings at local level. Often upon request of local 1995 regions neighbouring Liguria, while in the 2000’s bodies, the institution gradually expanded its action Listing on the stock exchange On 17th January 1995, it consolidated its presence on a national basis, in Greater Genoa, the Tigullio area and in Western following a public offering and underwriting, which through an external growth program. Liguria. involved over 16,000 new shareholders, Carige was listed on the Milan Stock Exchange and was rated 2013 by the major international rating agencies shortly The reorganisation The new bank, Banca Carige 1967 st A new name In 1967, the Bank took on the name of afterwards. Italia, became fully operational on 1 January 2013. Cassa di Risparmio di Genova e Imperia, thus Its listing in the Stock Exchange enabled the Banca Carige Italia is 100% owned by the parent reaffirming, even in the name, its consolidated Foundation to start a privatization process of the company Banca Carige, which transferred to the oversight in Western Liguria. Bank, thus reducing its own shareholding from the subsidiary all its branches (353) operating outside initial 100% to 46.63%, at the end of 2013, through Liguria. 1991 subsequent increases in Carige’s share capital and A public limited company Cassa di Risparmio di the conversion of a part of its ordinary shares into savings shares.

9 MISSION AND CORE VALUES

• Fostering the enhancement of human resources through professional growth paths and participation in the company’s objectives, also in relation to the respect for the rule of law, paying attention to the needs and the legitimate expectations of the internal and external stakeholders, in order to improve the feeling of belonging and the degree of satisfaction.

• Correctly and transparently pursuing efficiency, effectiveness and cost-benefit objectives of the operational management systems to increase the company’s profitability and competitiveness, attaining innovation standards through a constant updating.

• Pursuing the Company’s objectives, recognizing the central role of internal and external customers’ needs and shareholders’ expectations.

• Ensuring that all actions, operations, transactions and behaviours of the corporate bodies, staff and partners with respect to their responsibility and the activities performed in the exercise of their functions are based on the utmost levels of honesty, impartiality, confidentiality and transparency.

The Code of Ethics

The Code of Ethics represents the expression of the values and the principles of conduct acknowledged, accepted and shared by the Bank. In the first months of 2014, as foreseen by the provisions of the Supervisory Body, the Group’s banks have performed a review of their Code of Ethics, in step with the most advanced Corporate Governance standards. The Code of Ethics is aimed at ensuring that all the banking activities are performed in compliance with the law and carried on with honesty, integrity, correctness and good faith. Any behaviour contrary to the principles and the rules established in the Code constitutes a violation of the obligations assumed by those who – in any capacity – co-operate with the Bank and are therefore directly subject to sanctions, imposed by either the competent bodies or the Corporate Functions.

10 Honesty and impartiality Confidentiality Transparency and completeness of the information

• The primary interest of the Bank is pursuing • Banca Carige ensures the confidentiality of the • In the drafting of communications, reports, company goals, respecting the regulatory information in its possession and refrains from prospectuses and notices to Public Authorities, framework in force. Under no circumstances, seeking reserved data, unless it is expressly to the markets, to customers, to suppliers and a conduct in breach of and/or in contrast with authorized by the interested parties and, in any to its own employees and partners, the Bank the aforementioned regulations or internal case, always respecting the existing regulatory shall adhere to principles of transparency, policies will be excused. As far as their role framework, assuring that its own employees completeness and truthfulness, in order to and responsibilities arising from internal and and associate workers use the confidential assure full compliance with current laws and external regulations are concerned, all the information acquired with regard to their regulations. Company Representatives (managers, statutory relationship with the Bank solely for those auditors, executives), as well as the employees purposes connected with the performance of • In relation with third parties, shareholders and and collaborators of Banca Carige, shall respect their duties. customers, all the Company Representatives existing laws, the Code of Ethics and all the (managers, statutory auditors, executives), as internal procedures and rules. Their conduct, well as employees and partners of Banca Carige also in relations with third parties (customers, shall ensure – as much as possible – that third suppliers, external associates, partners, parties, shareholders and customers receive the competitors, media, market, etc.), has to comply requested information. Such information, or the with principles of independence, fairness, reasons why they cannot be provided, must be integrity, discretion and honesty, without drafted in plain, intelligible language. pursuing any personal interest. • Any form of collusion, corruption, favour, pressure and/or incentive exerted directly and/or through third parties in order to obtain personal and/or professional advantages for oneself and/or for others will not be allowed or tolerated. When defining the company strategies and taking any decision or action, all forms of discrimination should be avoided, in particular, based on race, nationality, gender, age, health, political and trade union opinions, religious beliefs.

11 2014-2018 BUSINESS PLAN

On March 27, 2014, the Business Plan of the Group Strategy Action plan and key initiatives was approved for the 2014-2018 period. The project aims at strengthening the capital position, mitigating • Re-confirm Carige’s historical vocation • Strengthen capital position the risk profile and recovering the operational as a locally rooted Retail Bank focused management’s profitability through a further on Northern Italy for households and • Mitigate financial risks and improve improvement of the cost base and an evolution of Small-Medium businesses liquidity position customer service model. To this end, the Group, with the new Plan, defined a • Reduce the Bank’s profile risk • Upgrade credit management model strategy focused on the simplification of the different sectors of the company. This measure will allow the • Pursue the «Efficient Distributor» • Renovate organisational model to Group to highlight its main point of strengths: model, partly exiting the role of Product- increase sales effectiveness • A major footprint in Italy’s richest areas; maker • Wide customer base with high level of loyalty • Improve operational efficiency, simplify and satisfaction; • Renovate the operating model organisational structure and strengthen • Pro-actively responsive branch network; Management Team • Gradually growing in the “digital arena”.

12 THE GROUP STRUCTURE

The main companies of the Group (2.2- 2.3) aimed at implementing a long-term preferential through the subsidiary Creditis Servizi Finanziari distribution relationship with Arca SGR S.p.A. The SpA, as well as in the trust services through its Banca Carige Banking Group, enrolled in the Register transaction was completed on 30th December 2013. subsidiary Centro Fiduciario CF S.p.A. of Banking Groups, is composed of the Parent Company Banca Carige and of the banking, financial and instrumental companies under its control.

The banking activity is carried out by the Banks of the Group - Banca Carige, Banca Carige Italia, Cassa di Risparmio di Savona, Cassa di Risparmio di Carrara, Banca del Monte di Lucca and Banca Cesare Ponti Banking Trust services Insurance Financial – each one with a deep territorial rooting in Liguria (Banca Carige and Cassa di Risparmio di Savona), Tuscany (Cassa di Risparmio di Carrara and Banca del Monte di lucca) and Lombardy (Banca Cesare Ponti).

The Group operates in the insurance and pension funding business through Carige Vita Nuova (life insurance) and Carige Assicurazioni (non-life insurance).

Up to the end of 2013, the Group performed its financial activity through Carige AM SGR, an asset management company. The agreement for disposal of Carige Asset Management SGR to Arca SGR S.p.A. was signed on 2nd August 2013 (2.9-3.8). The transaction included the signing of an agreement The Group is active in the consumer credit business,

13 Acting as Parent Company, Banca Carige manages and coordinates its subsidiaries. For this purpose, Banca Carige handles many functions, among which internal audit, compliance, anti-money laundering, risk management, accounting, business planning, control, finance.

Since 1st January 2013, 353 branches of Banca Carige located outside Liguria have been transferred to Banca Carige Italia, 100% owned by the Parent Company. The brand strongly reflects the mission of the Group: a deep connection with the Parent Company and proximity to both the territories and the entrepreneurial mindsets in an overall context which combines modern, reliable and concrete solutions.

Cassa di Risparmio di Savona, the oldest savings bank in Liguria, became part of the Group in 2000. It is currently the leading bank in the province of Savona and an important point of reference for the whole economy of the territory, strongly focused on both individual and business customers. Among its 60,000 account holders, Cassa di Risparmio di Savona maintains business relationships with the major local companies, as well as with local authorities, providing treasury and cash services. Its strengths are its connection with the territory and a wide distribution of branches (46 out of 50 based in Savona). Since 1991, the Bank crossed the regional borders and opened some branches in Piedmont.

Founded in 1489 as public pawnbroking institution (Monte di Pietà), Banca del Monte di Lucca has ever since been the cornerstone of the financial history of the town. Since 1517, the bank’s headquarters have been hosted in the central “Casa dell’Opera del Duomo”, a magnificent medieval building within the Cathedral. It has been part of the Group since 2000; with its 22 branches based in the provinces of Livorno, Lucca, Pisa and Pistoia, the Bank offers its customers professionalism and quality for every banking service, respecting at the same time its traditions.

Founded in 1843 as a charity, Cassa di Risparmio di Carrara became a credit institution in 1895. From then on, the taking of deposits is used to support the local economy, in particular the marble industry. After its initial presence in the Province of Massa Carrara, the Bank widened its network opening new branches in the province of La Spezia and later in Lucca, and today it has a branch in the city center of Pisa as well. In 1992, the Bank became a public limited company, separating the banking business (Cassa di Risparmio di Carrara) from the social activity (Fondazione Cassa di Risparmio di Carrara). In 2004, Cassa di Risparmio di Carrara joined the Group, becoming its most important player in Northern Tuscany in terms of presence.

The logo of Banca Cesare Ponti - small but historical credit institution based in Milan - includes both its founder’s name and its foundation year, (May 1871). Established with the main purpose of operating in the currency exchange business, the institute became a bank in 1906. Part of the Group since December 2004, Banca Cesare Ponti has maintained its distinctive name and logo, although now combined with the Group’s brand . Nowadays, it represents the Group’s flagship for private banking services.

14 GEOGRAPHICAL FOOTPRINT AND limitations and at a lower cost, Banca Carige Moreover, the Group has a network of 392 insurance provides on-line services (+7.3% contracts in 2013), agencies (272 of which authorized to promote and DISTRIBUTION NETWORK (2.5-2.7) mobile banking services (3,270,000 visits in 2013) sell banking products) situated throughout the and self-service channels (including ATMs and country. “Bancacontinua” branches) Multichannel is the keyword for Carige’s distribution Branches network model. As a matter of fact, Carige has been committed for a very long time to implementing and Corporate integrating all the communications channels with banking Private banking a view to contacting customers. The “traditional relationship relationship channels” (branches, private and corporate managers managers coordination units, affluent and small business 678 relationship managers) is based on a specialised customer service model which enables a gradual 147 137 transition from a comprehensive relationship Affluent Small business management handled by a single business unit to banking CUSTOMERS relationship a customized management performed by specific relationship 345 299 managers relationship managers. managers At the end of 2013, the traditional branches were 678, with almost 70% located in Northern Italy. The service of personal financial advice, dedicated to 3,270,000 795 high-profile customers, boasts a total of 137 private Mobile Banking ATMs banking and 345 affluent banking relationship (smartphone/tablet) managers. 405,555 19 Concerning the corporate world, 147 corporate 272 banking relationship managers (7 large corporate and 140 mid-corporate) and 299 small-business Self-service relationship managers complete the team. On-line services “Bancacontinua” (# contracts) branches To satisfy the information requirement of its customers and meet the demands for managing Insurance agencies banking relationships without space and time Figures as at 31/12/2013

15 NUMBER OF BRANCHES AND MARKET SHARE BY REGION GEOGRAPHIC DISTRIBUTION, KEY INDICATORS

16 Banca Carige’s presence in low-populated or economically disadvantaged areas (FS13) Banca Carige Group: breakdown by municipality

The presence of a bank branch may have a Development potential analysis significant role in terms of service for the community especially in areas of low population density and in Municipalities of which: with of which: Low Low Low Low Low with branches a sole branch located in potential potential potential financial total economically disadvantaged regions. Banca Carige is of the Carige municipalities Consumers Corporate Services potential potential present in 47 municipalities where it operates as the Group with a (*) (*) (*) (*) (*) sole bank. A branch of the Carige Group is operating population in 20 municipalities with a population density of density <50 less than 50 inhabitants/Km² (13 in Liguria and 3 in inhabitants per Tuscany). To identify economically disadvantaged km2 areas, reference can be made to regional analysis Liguria 113 25 13 24 28 3 models (1) in order to assess the economic Piedmont 41 2 1 2 8 attractiveness of the various areas compared with a benchmark value. In particular, the economic Valle d’Aosta 1 potential of a municipality can be assessed against Lombardy 51 1 15 a set of indicators relating to socio-demographic Veneto 34 2 4 criteria of the residents (age, education, income, job), the production structure (number of companies, Emilia Romagna 20 1 1 company size, revenue, number of employees), Tuscany 46 2 3 2 2 7 1 services and financial wealth (deposits, funds, loans) Umbria 2 to establish a rank ordering of the municipalities. Marche 2 Considering the municipalities with an extremely low potential indicator where a branch of the Latium 19 6 1 2 3 14 2 Group is in operation (within the first quintile of the Apulia 8 4 6 valuation range), 27 economically disadvantaged Sicily 46 11 1 25 16 25 46 24 municipalities with at least one operating branch of the Group have been identified; 24 municipalities Sardinia 8 7 are located in Sicily. TOTAL 391 47 20 25 47 87 87 27 (1) analysis based on the geomarketing model developed by (*) the low potential in each segment refers to the lowest 20% of the valuation range Master Information Srl in 2013 Source: data processing by Master Information 2013

17 CORPORATE GOVERNANCE

The Corporate Governance (4.1-4.7) Banca Carige Governance Structure (1)

The corporate governance of Banca Carige is Board of Directors intended as a set of tools, rules and mechanisms Cesare Castelbarco Albani (Chairman) designed to ensure the best decision-making Alessandro Repetto (Deputy Chairman) process in the interests of the different stakeholders. Piero Luigi Montani (CEO) It considers the provisions and principles which Jérôme Gaston Raymond Bonnet Luca Bonsignore Executive Committee apply to listed issuers, as established by both Remo Angelo Checconi Cesare Castelbarco Albani the Italian Consolidated Law on Finance and the Evelina Christillin Alessandro Repetto Italian Securities Authority (Consob) regulations. It Lorenzo Cuocolo Piero Luigi Montani also takes into account the rules laid down in the Philippe Marie Michel Garsuault Remo Angelo Checconi Consolidated Law on Banking and in the Supervisory Guido Pescione Giuseppe Zampini Provisions issued by the Bank of Italy, as well as in the Lorenzo Roffinella Corporate Governance Code for Listed Companies Elena Vasco approved by Borsa Italiana S.p.A. Lucia Venuti The management and control system adopted by Philippe Wattecamps Banca Carige is a conventional one and it consists of Giuseppe Zampini Shareholders’ Meeting, Board of Directors and Board of Statutory Auditors. A further in-depth analysis of the corporate governance procedures and the detailed profiles Appointments Committee Remuneration Committee Risk and Control Committee and backgrounds of the Directors are available in the Cesare Castelbarco Albani - Chairman Lorenzo Cuocolo - Chairman Lorenzo Cuocolo – Chairman Report on Corporate Governance and Ownership Remo Angelo Checconi Luca Bonsignore Luca Bonsignore Structure, approved by the Board of Directors on Evelina Christillin Evelina Christillin Philippe Marie Michel Garsuault Philippe Marie Michel Garsuault Lorenzo Roffinella 27th March 2014 and published on the company Philippe Marie Michel Garsuault Elena Vasco Lorenzo Roffinella Lucia Venuti website (www.gruppocarige.it, section “Governance – Company Documents). The key figures of the Board of Statutory Auditors Supervisory Body pursuant to Auditing firm Corporate Bodies, with specific reference to the Stefano Lunardi (Chairman) Italian Leg. Decree 231/01 Reconta Ernst & Young S.p.A. changes introduced during 2013 and the first months Maddalena Costa (Statutory Auditor) Adalberto Alberici (Chairman) of 2014, are briefly described below. Vittorio Rocchetti (Staturory Auditor) Massimo Boggio Francesco Isoppi (Alternate Auditor) Sofia Maranini

(1) As at 15/5/2014

18 Shareholders’ Meeting (4.1-4.7) representative of the Bank vis-à-vis third parties • subsequent presentation of a report for and has no specific management powers (4.2). the Board, drawing up the plan of possible The Shareholders’ Meeting represents all the The current Board of Directors was appointed on interventions to be realized by the Bank, as shareholders and its resolutions, passed in 30/09/2013 and will remain in office until the date proposed by the Chairman of the Board of compliance with the law and the Articles of of the Shareholders’ Meeting called to approve the Directors, after consultation with the Top Association, shall be binding on all shareholders, financial statements as at 31 December 2015. Management and the Appointments Committee. including those who are absent or in disagreement. The Ordinary Meeting resolves those matters On 29th October 2013 Piero Luigi Montani was The final report, noted by the Board during the established by the law, but also the authorizations co-opted by the Board of Directors to replace aforementioned meeting, certifies that the overall for the execution of Director’s transactions with outgoing Director Mr Luigi Gastaldi (resigning opinion expressed by the Members of the Board on related companies. on the same date), with term of office until the the size, composition and operation of the Board of Moreover, the Meeting has the power to take following Shareholders’ Meeting, and later serve Directors and of its Committees is to be considered resolutions on the appointment and the revocation as CEO as of 5th November 2013. The Ordinary positive. of the Board of Directors, the Chairman and the Shareholders’ Meeting of 30th April 2014 confirmed Therefore, the Board of Directors has adopted Deputy Chairman. the appointment of Piero Luigi Montani as Director. positive conclusions on the operation of the Board On 6th May 2014, the Board of Directors confirmed and its Committees, as well as on their size and The Board of Directors for Mr Montani the powers he had been granted composition, without prejudice to some areas of upon prior appointment to the position of Managing improvement and the possible intervention plan, The Board of Directors is comprised of a minimum of Director. During the meeting of 18th March 2014, the which the Board of Directors could usefully take into eleven and a maximum of eighteen members. The Board of Directors carried out the assessment of the account during its mandate (4.10). members of the Board of Directors are elected on size, composition and operation of the Board itself the basis of the lists submitted by the shareholders and its Committees, taking also into consideration in accordance with the provisions laid down in details such as professional features, experience, the Articles of Association (www.gruppocarige. even in managerial positions, and gender of its it, section Governance – Company Documents – members, as well as seniority in office. Articles of Association). The self-assessment process, supported by a leading The Board exercises all the powers of ordinary consulting firm, has been performed through: and extraordinary administration, except for those • individual interviews with each Director expressly reserved by the law to the Shareholders’ and with the Chairman of the Board of the Meeting. Statutory Auditors, on the basis of a structured The Directors remain in office for three financial questionnaire; years and may be re-elected. The Board of Directors • analysis of the results and prior discussion with usually meets once a month. the Chairman of the Board of Directors and the The Chairman of the Board of Directors is the legal Appointments Committee;

19 Structure of the Board of Directors (2013) (4.3) Name Office In office since In office until Executive Non- Gender Age range Independence* Attendance in meetings executive (following renewal on 30/9/2013)

27/4/2007 Shareholders’ Meeting for the approval  Cesare Castelbarco Albani Chairman of the financial statements as at M >50 100% (Chairman since 30/9/2013) 31/12/2015

27/4/2012 Shareholders’ Meeting for the approval  Alessandro Repetto Deputy of the financial statements as at M >50 100% Chairman (Deputy Chairman since 31/12/2015 30/9/2013) 29/10/2013 Shareholders’ Meeting for the approval Piero Luigi Montani CEO of the financial statements as at  M >50 100% (CEO since 5/11/2013) 31/12/2015 Jérôme Gaston Raymond Shareholders’ Meeting for the approval Director 30/9/2013 of the financial statements as at  M 30-50  89% Bonnet 31/12/2015

Shareholders’ Meeting for the approval Luca Bonsignore Director 31/3/2003 of the financial statements as at  M 30-50 78% 31/12/2015

Shareholders’ Meeting for the approval Remo Angelo Checconi Director 31/3/2003 of the financial statements as at  M >50 100% 31/12/2015

Shareholders’ Meeting for the approval Evelina Christillin Director 30/9/2013 of the financial statements as at  F >50  67% 31/12/2015

Shareholders’ Meeting for the approval Lorenzo Cuocolo Director 30/9/2013 of the financial statements as at  M 30-50  100% 31/12/2015

Shareholders’ Meeting for the approval Philippe Marie Michel Garsuault Director 17/10/2011 of the financial statements as at  M >50  33% 31/12/2015

Shareholders’ Meeting for the approval Guido Pescione Director 29/4/2009 of the financial statements as at  M >50  100% 31/12/2015

Shareholders’ Meeting for the approval Lorenzo Roffinella Director 3/12/2012 of the financial statements as at  M >50  100% 31/12/2015

Shareholders’ Meeting for the approval Elena Vasco Director 30/9/2013 of the financial statements as at  F 30-50  89% 31/12/2015

Shareholders’ Meeting for the approval >50 Lucia Venuti Director 30/9/2013 of the financial statements as at  F  100% 31/12/2015

Shareholders’ Meeting for the approval Philippe Wattecamps Director 27/4/2012 of the financial statements as at  M >50  78% 31/12/2015

Shareholders’ Meeting for the approval Giuseppe Zampini Director 30/9/2013 of the financial statements as at  M >50 89% 31/12/2015

Number of meetings held during 2013: 27 (9 held during the current mandate)

(*) independence: pursuant to the Corporate Governance Code for Listed Companies 20 The Executive Committee Committees Functions No. of members No. of meetings Pursuant to the Articles of Association, the Executive (no. of following renewal Committee is appointed by the Board of Directors independent on 30 Sept 2013 which determines the number of members, the term members) in office and the powers. The Executive Committee (average presence) is composed of the Chairman, Deputy Chairman and Chief Executive Officer, as members by rights, as well as a number of other members selected by the Consulting and proposal-making Board of Directors. role towards the Board of Directors, Appointment Committee 5 (3) 4 (65%) The Executive Committee meets generally on a in relation to appointment and weekly basis. In 2013, there were 44 meetings with designation of corporate members an average duration of 90 minutes and a high participation.

The Board Committees Consulting and proposal-making The Board of Directors, in line with the provisions Remuneration Committee role concerning the remuneration 5 (4) 3 (67%) of the Corporate Governance Code, has set up policies the Control and Risk Committee (Internal Audit Committee), the Remuneration Committee and the Appointments Committee. These Committees play an advisory and proactive Consulting and proposal-making role and their structure is in accordance with the Control and Risk role, providing in particular guidelines of the aforesaid Corporate Governance Committee (Internal Audit assistance to the Board in assessing 5 (4) 7 (77%) Code. Committee) the adequacy of the internal control and risk management system

21 The Control and Risk Committee is designed to It has both decision-making powers relating to carige.it support, with suitable preliminary activities, the credit facilities and support functions to corporate valuations and decisions of the Board of Directors bodies in the risk management, in terms of defining The Board of Statutory Auditors with regard to the internal control and risk the credit policy and the assumption and monitoring management system. Furthermore, the Control and of the credit risk. The ordinary Shareholders’ Meeting appoints three Risk Committee is assigned the same competences Standing Auditors and two Alternate Auditors on the as the Independent Directors, pursuant to the Supervisory Body pursuant to Italian Legislative basis of the lists presented by the shareholders in Consob Related Party Transactions Regulation, the Decree 231/2001 (4.6; S02) accordance with the procedures provided for in the Bank of Italy Supervisory Provisions for transactions Articles of Association. with Associated Individuals and the Supervisory The Board of Directors, pursuant to the provisions The Board of Statutory Auditors in office during 2013 Regulations issued by the Bank of Italy concerning of Italian Legislative Decree 231/2001 on was appointed on 29th April 2011. Subsequently, on “Equity investments for banks and banking groups”. administrative responsibility of companies and legal 30th April 2014, the Shareholders’ Meeting renewed It is composed of a minimum of 3 up to a maximum entities, established a Supervisory Body in charge the same Board for three financial years. of 6 members selected by the Board of Directors of supervising the operation and observance of The Board of Statutory Auditors is assigned all the among its non-executive members (most of which the Bank’s organisational and management model, powers deemed necessary in order to perform are independent ones) according to the highest as well as of its updating, revising and refinement, the duties entrusted by law and by the Corporate standards of expertise (at least one member must entrusted with independent powers of initiative and Governance Code for Listed Companies and to have an adequate experience in accounting and control for that purpose. ascertain, in particular, the effectiveness of all finance or risk management, to be assessed by Moreover, the Board of Directors has recently structures and functions involved in the control the Board of Directors upon appointment) and resolved to approve a review of the composition system and their adequate coordination. availability to fulfil their task. of the Supervisory Body in order to strengthen its During 2013, the Board of Statutory Auditors held 87 The Chairman of the Control and Risk Committee autonomy and independence, envisaging solely the meetings with an attendance of 97%. reports to the Board of Directors at least every six presence of external members meeting adequate months, upon the approval of the annual and half- and certified independence requirements (banking, Corporate Documents and Regulations (4.8; 4.12) yearly financial report, on the activities undertaken finance, insurance or criminal law experts). and on the adequacy of the internal control and risk Furthermore, any possible report related to practices The Board of Directors of Banca Carige adopted management system. which do not comply with the code of conduct organisational models as well as operational and established in the Code of Ethics of the Bank must control mechanisms consistent with the nature and Moreover, during the meeting of 20 February 2014, be provided to the Supervisory Body. These reports extent of risks arising from the Group activity. the Board of Directors resolved to set up a Credit can be directly forwarded to the Supervisory Body, Committee, with effect from 3rd March 2014. This in writing and not anonymously, addressing them The “Governance and Control of the Committee is chaired by the Deputy Chairman of the to the General Secretariat of the Bank; third parties administrative and accounting processes of the Board of Directors and it is composed of members can submit these reports directly to the Supervisory Banca Carige Group” covers the whole range of of the management . Body by emailing at organismodivigilanza231@ operations performed by the Group and defines

22 the responsibilities assigned to each organisational Policy, as far as they are concerned, thus being able public disclosures of the transactions executed by unit involved in generating financial information, to to accurately identify the deliberative procedures relevant persons on shares or financial instruments provide reasonable assurance of achieving corporate applicable to the transactions with associated connected with Banca Carige’s shares, providing objectives, represented by: individuals, in accordance with the guidelines guidance to the market as regards the way the • effectiveness and efficiency of operations; provided by the Parent Company and considering aforementioned subjects perceive the Company’s • reliability of financial information (reporting); the same group of “associated individuals” for the prospects. • compliance with laws and regulations Banca Carige Group as a whole. (compliance) Banca Carige adopts a “Code of conduct pertaining The Board of Directors has also approved the to the provision of investment services and The “Group’s Rules” represent an internal “Internal policies on controls over the risk assets personal transactions executed by relevant regulatory framework with regard to coordination and conflicts of interest involving associated persons”, to be applied by the banks of the Group and monitoring instruments and mechanisms of the individuals”. and, until 30th December 2013, to Carige Asset Group as a whole. In addition, in order to determine and adequately Management SGR S.p.A. manage situations in which a Director has an This code identifies, amongst other things, the The Code of Ethics, intended for Directors, interest, on his own account or on behalf of a third procedures suitable to ensure fulfilment of fair Executives, employees and business partners, party, the Board of Directors has defined the current dealing and transparency requirements when howsoever named, states the reference values “Regulation on the obligations of corporate providing investment services, as well as to maintain which guide Banca Carige’s activities and, therefore, representatives of the Carige Group”, transposing the confidentiality of the information received in it sets forth the rules of conduct aimed at consciously from time to time the regulatory change, pursuant that context. steering the standards of behaviour consistently to Art. 136 of Italian Consolidated Law on Banking. with those values. The Regulation provides a specific procedure for the approval of transactions involving a company The “Company Policy Regarding Transactions representative (Director, Statutory Auditor or with Related Parties and Associated Individuals” General Manager) of a bank of the Carige Group, defines procedures aimed at ensuring transparency which entail an obligation of any kind of the same as well as substantive and procedural fairness of representative towards the bank he belongs to (4.6). such transactions, in accordance with the provisions of Consob, as well as procedures for preserving The Board of Directors of the Bank has approved the integrity of the decision-making process in the a “Code of conduct pertaining to privileged transactions with associated individuals which are information” which defines the procedures for adopted by the banks of the Group. both the internal management and the external The subsidiary banks, to which the supervisory disclosure of confidential and privileged information, banking rules are directly applied, have in turn as well as a “Code of conduct pertaining to internal transposed and put into effect the aforementioned dealing transactions”, which, inter alia, regulates

23 THE INTERNAL CONTROL AND RISK MANAGEMENT SYSTEM (4.11)

Control level Function Units involved The Parent Company Banca Carige, in line with the law and supervisory regulations and in accordance with the guidelines from the Corporate Governance These checks are performed by operating Code for listed companies, has adopted an Internal units or may be integrated within the Control System (ICS) aimed at detecting, measuring Line controls support procedures to ascertain the Operating units or systems and continuously assessing the risks typically related (level 1) activities carried out by them in the integrated within the to its corporate activity. The system is designed processes they are responsible for, as support procedures to ensure a sound and prudential management compared to what the Internal Rules set which combines the Company’s profitability with a forth on the same matter. consistent risk assumption and a business focused on criteria of transparency and fairness. The Banca Carige’s Internal Control System is periodically revised and adjusted to the trends of • Manager responsible for preparing the company’s the business activity and the reference framework, These control activities aim at defining financial reports and it is based on a set of rules, procedures and models of risk measurement, verifying • Risk management dept. organisational structures aimed at ensuring that the Risk management controls compliance with the operational limits • Rating systems validation corporate strategies and the operational equilibrium (level 2) assigned to the different business units • Compliance dept. are respected. and monitoring the achievement of the • Anti-money laundering risk/yield objectives allocated to them. In order to implement the control activities dept. prescribed by the Supervisory Provisions and/or the Internal Rules, Banca Carige has defined a three- level control system for its banking Group, which Its aim is to assess the adequacy and includes: line controls, risk-management controls effectiveness of the first and second level and internal audit controls controls with the purpose of identifying Internal audit controls possible anomalous trends, breach of Internal Audit Dept (level 3) rules and procedures as well as evaluating the overall functioning of the Internal Control System.

24 Compliance Dept rules. branches, of the customers with a high-risk The Compliance operates on the basis of an Activity profile in terms of money laundering; The Compliance area is committed to monitoring Plan approved by the Board of Directors at the • the effective detection, by the branches, of the the risk of non-compliance with regulations. This beginning of each year and covers the work carried potentially suspicious transactions. risk is defined as the risk of incurring administrative out through a series of reports submitted to the Regarding the reporting of suspicious transactions, sanctions, significant financial losses or reputational Board of Directors. the Anti-Money Laundering Dept. collects from damage as a result of the infringement of legislative the branches and the corporate IT systems all provisions or regulations or for failure to comply Anti-Money Laundering Dept information relating to transactions reported as with self-regulatory codes. suspicious by the branch network, performing a In particular, the Compliance has the following tasks: The Anti-Money Laundering Dept. has been proper inquiry to support the decision of the Anti- established within the Compliance area, under the Money Laundering Manager under Art. 42 of Italian • accurately identifying all possible non- supervisory legislation concerning organisation, Legislative Decree 231/07 on reporting or not these compliance risks the Bank is subject to during procedures and internal controls aimed at transactions to the FIU (Financial Intelligence Unit). its activity; preventing the use of the financial institutions for • verifying the measures implemented by the money laundering and terrorism financing. Internal Audit Dept Bank; Due to its regulatory and operational independence • assessing whether these measures are sufficient and importance, the activity of this corporate The Internal Audit is handled by the Internal Controls to reduce the non-compliance risk; function is approved by the Board of Directors. and has the task of verifying the adequacy and • proposing organisational or procedural changes; effectiveness of the first and second level controls. • reporting to the Top Management on the actual The control activities of the Anti-Money Laundering This unit operates as Internal Audit Function within level of compliance and on possible actions Dept. are designed to ensure: the Group, based upon an Audit Model founded deemed necessary to eliminate non-complying • the reliability of the information system feeding on a methodological approach which is focused situations. the Single Computer Database of the Company; on identifying and representing the risk level • the management of the customer due diligence associated with the corporate activities that leads The Compliance Dept. shall ensure, inter alia, the measures, particularly those relating to to the qualitative identification of the residual risks prevention and management of any conflict of “enhanced” due diligence; borne by the Company, as well as to a consequent interest, i.e. cases in which the customer’s interest • the identification of the infringements to be assessment of adequacy of the Internal Control does conflict with the Bank’s or another customer’s reported to MEF (Ministry of Economy and Systems. interest. Finance); This Audit Model is applied to all the corporate Moreover, they have to verify that the corporate • the monthly transmission to FIU (Financial processes and to all the Group’s entities and it is incentive schemes are consistent with the rules and Intelligence Unit) of the aggregated data applied to both the process and network Auditing. do not encourage misconduct. registered in the Single Computer Database of It is developed during the so-called “Auditing Finally, this area actively contributes to the creation the Company; Life-cycle”, also with the support of dedicated IT of a corporate culture focused on compliance with • adequate monitoring and management, by the applications which enable to manage all its typical

25 phases: of Ethics and the Organisational Model establish the Liability Committee, the ICAAP Committee and the • Activity planning; respect of internal rules drawn on the basis of the Top Management. • Verifications; applicable provisions of law, particularly with regard • Risk and control assessment; to waste management activities. Moreover, within the insurance subsidiaries, a • Detailed or summarized reporting; As regards the monitoring of the Model adequacy, series of different strategic functions have been • Follow-up of issues; on a quarterly basis, the Managers overseeing the established (Internal Audit, Risk Management and • Human Resources management. “sensitive” sectors as per the Italian Legislative Compliance), which are centralised at Carige Vita Decree 231/2001, are submitted a form featuring Nuova S.p.A. The Parent Company has steering and supervision the offences most affecting the company area, for The Parent Company undertakes to carry out functions on all risks, especially through an possible considerations and intervention on the periodic inspections against the Group’s subsidiaries, integrated management of Pillar 1 and Pillar 2 risks, identified issues(FS9). included – also through the Insurance Parent under the Bank of Italy supervisory instructions Company Carige Vita Nuova – the insurance (Circ. No. 263 of 27 December 2006 and following The strategy of the Group in respect of Banking companies and their subsidiaries, in order to ascertain amendments). Companies led over time to the centralization of the compliance with the guidelines established by a number of activities at the Parent Company, the Parent Company and the effectiveness of the In terms of corruption risk monitoring (SO2), a set in particular, the activities of internal control, internal controls system of these subsidiaries. In of instruments for prevention and risk management compliance, anti-money laundering, risk this respect, Banca Carige defines – as part of an has been implemented. The Group’s Code of Ethics management, accounting, finance, strategic overall plan – the methodological approach to the and the Organisational and Management Model planning and control. internal audit of the banking and insurance Group represent the main instruments enabling to mitigate The same strategy has been adopted by Creditis and carries out, through the Internal Control Dept., the corruption risk. In particular, the organisational Servizi Finanziari S.p.A. as well as Carige Asset a periodic internal audit on its subsidiaries, to assess and functional set-up envisages the allocation of Management SGR S.p.A. (sold on 30th December the transposition of the control guidelines as defined competences between the units that decide on 2013). However, in view of its specificities, Creditis by the Parent Company (management audit). spending and those responsible for incurring the Servizi Finanziari S.p.A. has introduced internal Further details on the Group’s Internal Control expense. compliance and anti-money laundering procedures, System are available in the “Corporate Governance Therefore, every expense must be justified in while Carige Asset Management SGR S.p.A. had Report for the 2013 financial year” available on the advance before the authorizing Body. already adopted internal compliance, anti-money website www.gruppocarige.it (Section Governance Moreover, the power delegation system sets laundering and risk management policies. – Company Documents). different levels of approval for spending by different parties, while the corporate regulations identify the persons empowered to liaise with the Public As noted above, the different risk categories are Authorities. monitored by the 2nd level controls, which results As concerns environmental crimes (Italian Legislative are periodically notified to the Board of Directors, Decree 152/2006 “Environmental Code”), the Code the Risk and Control Committee and the Board of Statutory Auditors as well as to the Asset and

26 Co-ordination among subjects involved in the CORPORATE BODIES AND INTERNAL CONTROL SYSTEM: INFORMATION FLOWS Internal Control System and Risk Management

In accordance with the Corporate Governance Code and the Supervisory Rules, Banca Carige takes particular care to set up complete, timely and accurate communication and information exchange among the Company Bodies which are responsible Board of Audit for strategic supervision, management and control, Statutory Firm in relation to each area of competence, and also Executive Auditors Board of Comm. within each Body. In this regard, specific corporate rules governing the Directors identification of the persons who must provide - on Control a regular basis - information flows to the Company & Risk Bodies, establish that those responsible for internal Comm. Corporate Control control functions within the Bank’s organisational Functions structure do report directly to the Board of Directors, the Control and Risk Committee and the Board of Statutory Auditors. Compliance Internal Audit

CEO Anti-Money Risk Executive Laundering in charge

Supervisory Body

27 2013 AWARDS AND PRIZES (2.10)

GRAND PRIX EUROPEAN FUNDS TROPHY PARIS Carige Sgr A.M. was recognized as “Best Asset Management Company” in the “similar product range category”. The awards were announced and presented by Fund Class, an independent fund rating agency located in Paris.

IL SOLE 24 ORE, IN COLLABORATION WITH CFS RATING: Carige Sgr A.M. was awarded the ‘High-Yield Award’ (Premio Alto Rendimento) as best 3-year Italian Fund Manager in the small-sized companies category and Italy’s best Geographical Equity Fund in the “CFS International Equity Ratings” category.

Carige SGR A.M. was awarded the “Premio Tripla A” (Triple A Award), one of the most coveted awards in the asset management area, presented during the 15th edition of “Milano Finanza Global Awards 2013”.

In 2013, Banca Carige attended the 4th edition of “Giornate Giuseppe Siri”, event organized by UCID (Unione Cristiana Imprenditori – Christian Union of Entrepreneurs ) and SIBC (Impresa sociale per il bene comune – Social Enterprise for the Common Good), where companies propose new paths of corporate responsibility, at the presence of the Cardinal Archbishop of Genoa Angelo Bagnasco.

“IoPonti” allows customers and advisors to communicate in web conference through a system that ensures higher security standards. Furthermore, the system enables its users to view, examine and share on the customer’s device economic and financial documents, as well as market analysis, securities position, etc. The IoPonti app of remote advisory for Banca Cesare Ponti’s customers was awarded by AIFIn, Associazione Italiana Financial Innovation – Italian Association Financial Innovation for its highly innovative content as the first real-time remote advisory service launched in Italy in the private banking sector.

28 ECONOMIC REPORT

• Financial Highlights criteria for exposure classification and assessment operating costs, net of non-recurring items. • Value Added in line with guidance received from the Bank of Italy during its inspection. This resulted in the balance- The 2013 financial year ended with a consolidated sheet recognition of loan loss provisions for an loss of approximately EUR 1,761.7 mln. FINANCIAL HIGHLIGHTS amount of EUR 1,063.4 mln. In the fourth quarter, approximately EUR 2 bn worth of securities in the The table below shows the most significant The Economic Report is the section of the Corporate AFS (Available For Sale) portfolio were divested aggregates and summary financial indicators Social Responsibility intended to provide the and re-invested in shorter-maturity securities to regarding the Group’s performance. income statement data, reclassified in order to improve the liquidity profile. highlight both the Value Added creation process (the difference between the wealth generated and Impairment losses were recognised in the insurance total consumptions) and its allocation among all business for a total amount of EUR 185.0 mln, largely those who have, in several respects, an “exchange” attributable to depreciation of real estate properties, relationship with the Group: customers, communities, provisions for claims reserves and write-downs on shareholders, employees and suppliers. loans. Conversely, a positive contribution came from non- The running of operations in 2013 took place against recurring items including the capital gain arising a background of deterioration of the overall macro- from the disposal of the Group’s Asset Management economic and financial environment, in which the company (EUR 92.9 mln) and the re-valuation of Group focused on aligning the assets’ book value the stakes in the Bank of Italy for an amount of to the current market values, thereby lowering its approximately EUR 300.0 mln. risk profile. This effort has led to the recognition of The difficulties of the macro-economic and financial material non-recurring value adjustments to profit context were reflected on the slowdown in funding/ and loss. The most significant non-recurring item lending volumes with retail customers (-4.6% in for the period, totalling EUR 1,673.0 mln, consisted gross loans, from EUR 25.3 bn to EUR 24.2 bn and in the impairment of goodwill recognised upon past -3.1% in direct funding, from EUR 20.8 bn to EUR acquisition of banks and branch networks, which 20.1 bn) and core business performance (-15.9% translated in a 94% reduction in goodwill value. The in NII and -7% in net fees and commissions). A loan book was entirely reviewed on the basis of strict strict spending control enabled a 2.0% reduction in

29 Financial highlights 2013 2012(1) Change % BALANCE SHEET Total assets 42,156,275 48,441,120 -13.0 Funding 33,216,527 37,031,911 -10.3 -Direct deposits (a) 25,055,285 28,545,184 -12.2 *Deposits from customers 14,817,367 16,729,803 -11.4 *Securities issued 9,217,979 11,022,540 -16.4 *Liabilities at fair value(2) 1,019,939 792,841 28.6 -Deposits from banks 8,161,242 8,486,727 -3.8 Indirect funding (b) 22,824,716 22,596,938 1.0 -Assets under management 10,510,623 10,020,757 4.9 -Assets under custody 12,314,093 12,576,181 -2.1 Overall funding from customers (a+b) 47,880,001 51,142,122 -6.4 Investments 39,802,272 43,630,826 -8.8 -Loans to customers (3) 27,621,157 31,272,746 -11.7 -Loans to banks (3) 1,119,213 1,957,909 -42.8 -Securities portfolio 11,061,902 10,400,171 6.4 Share Capital and reserves 3,349,038 2,762,654 21.2 INCOME STATEMENT Net interest and other banking income 1,019,165 1,230,973 -17.2 Net income from banking and insurance -228,263 445,866 … Profit (loss) before tax from continuing operations -2,595,130 -224,928 … Profit for the period -1,761,657 23,429 … KPIs Operating costs/Net interest and other banking income (Cost income ratio) 77.7% 54.8% Banking income Profit (loss) before tax from continuing operations/Share Capital and reserves -77.5% -8.1% ROE (Return on Equity) -52.6% 0.8% ROE (Return on Equity) (4) -50.7% 0.7% ROAE (Return on Average Equity) (5) -57.6% 1.0% ROAE (Return On Average equity) (4) (5) -50.9% 0.7% BANK CAPITAL ADEQUACY Total weighted assets 21,551,600 24,234,063 -11.1 Core tier1 / Total weighted assets 5.1% 6,7% Tier 1 / Total weighted assets 5.8% 7.4% Regulatory capital including Tier 3 / total weighted assets 9.2% 10.5%

Figures in thousands of Euro

(1) Some data in the 2012 balance sheet a P&L were restated due to the retrospective application of the new IAS 8. (2) Carige Vita Nuova’s liabilities at fair value relating to products whose investment risk is borne by policyholders are not included in this table. (3) Amounts before value adjustments and net of debt securities classified as L&R. (4) After the AFS reserve (item 140 under Liabilities in the balance sheet). (5) Net profit against the average equity (Return on Average equity). 30

a reallocation of resources among some of them VALUE ADDED (EC1) occurred, drawing from the corporate assets. ECONOMIC VALUE 2013 2012 The determination and distribution of Value In particular, operational difficulties did not erode Added among the stakeholders represent the link the remuneration amount for suppliers, personnel between economic and financial data and the social A. TOTAL ECONOMIC and communities (mainly for local taxes and duties), - 20,607 505,632 reporting. In 2013, the Banca Carige Group closed VALUE GENERATED while risk capital shareholders did not receive the financial year with a negative result mainly dividends this year as well. attributable to the impairment of goodwill, the loss B. TOTAL ECONOMIC of Carige Assicurazioni and the substantial loan loss Overall, the Economic Value Distributed amounted 704,635 1,041,849 provisions. to EUR 704.6 mln, against which a use of EUR 725.2 VALUE DISTRIBUTED mln was recorded. The statement, consistent with the update proposed by the Italian Banking Association (ABI) starting C. TOTAL ECONOMIC - 725,242 - 536,217 from 2010, firstly shows the total economic value VALUE RETAINED generated by the company’s ordinary business, followed by the distribution in terms of economic Figures in thousands of euros value distributed and retained. The economic value distributed is allocated among the main stakeholders (Suppliers, Employees, Third Parties, Shareholders, Public Bodies and Institutions, (1) Theoretically, the economic value generated is the sum Community and Environment). The economic value of the economic value distributed and the economic value retained concerns value adjustments, deferred tax retained. In the statement proposed by the Italian Banking assets and liabilities, provisions and net profit. Association (ABI), the algebraic sum of these 3 values is equal to zero. This means that, if all the 3 values are positive, against an Therefore, in 2013, the economic value generated economic value generated reported in the statement with the sign (+), the other 2 economic values (distributed and retained) by the Group was –EUR 20.6 mln, essentially due to are written with the sign (-). As for the Carige Group, a negative major impairment losses on loans and the negative (-) economic value generated was registered in 2013. Due to result of the insurance business. (1) this and to a positive economic value distributed (indicated by a minus sign in the statement), the economic value retained is Economic value distributed necessarily negative (with a sign “+” in the statement) for an amount exceeding the economic value distributed. This means The negative trend of the Economic Value Generated that, for the period under consideration, the Group is not able had inevitable consequences on the distribution of to retain wealth, but, on the contrary, it is forced to use this resources to stakeholders. Since wealth creation wealth to face the need to remunerate stakeholders. This use, was not enough to remunerate all stakeholders, in this case, is higher than the amount distributed, because of the negative outcome of the ordinary business.

31 Variazione Change % 20132012 20132012 absoluteassoluta %% VOCIINCOME DI BILANCIO STATEMENT Interest and similar income 1,205,428 1,422,387 - 216,959 - 15.3 Interest and similar expense(-) - 569,354 - 666,423 97,069 - 14.6 Fee and commission income 328,456 359,416 - 30,960 - 8.6 Fee and commission expense(-) - 56,428 - 56,226 - 202 0.4 Dividend and similar income 4,840 6,461 - 1,621 - 25.1 Net profit (loss) from trading - 287,903 3,559 - 291,462 … Net profit (loss) from hedging - 11,108 - 284 - 10,824 … Gains (losses) on disposal/repurchase of: 365,859 157,266 208,593 … a) loans - 1,644 262 - 1,906 … b) financial assets available for sale 342,875 155,540 187,335 … c) financial assets held to maturity 21,261 - 21,261 … d) financial liabilities 3,367 1,464 1,903 … Net profit (loss) from financial assets and liabilities designated at fair value 39,375 4,817 34,558 … Net impairment losses/reversals on: - 1,107,361 - 603,284 - 504,077 83.6 a) loans - 1,063,420 - 447,435 - 615,985 … b) financial assets available for sale - 16,570 - 155,863 139,293 - 89.4 c) financial assets held to maturity - - - … d) other financial transactions - 27,371 14 - 27,385 … Net insurance premiums 1,061,314 1,032,007 29,307 2.8 Other net insurance income/expense - 1,201,381 - 1,213,830 12,449 - 1.0 Other operating expenses (income) 115,046 59,716 55,330 92.7 Gains (losses) on investment in associates and companies subject to joint control (relating to “gains 92,889 - 92,889 … (losses) from disposal”) Profit (loss) from disposal of investments - 279 50 - 329 … Profit (loss) after tax from non-current assets held for sale - - - … A. TOTAL ECONOMIC VALUE GENERATED - 20,607 505,632 - 526,239 …

32 Change 2013 2012 absolute % INCOME STATEMENT Other administrative expenses (net of indirect taxes and donations) (-) - 205,383 - 201,153 - 4,230 2.1 ECONOMIC VALUE DISTRIBUTED TO SUPPLIERS - 205,383 - 201,153 - 4,230 2.1 Personnel expenses (-) - 400,146 - 402,938 2,792 - 0.7 ECONOMIC VALUE DISTRIBUTED TO EMPLOYEES AND PARTNERS - 400,146 - 402,938 2,792 - 0.7 Profit (loss) for the period attributable to non-controlling interests (-) 15,051 - 1,083 16,134 … ECONOMIC VALUE ATTRIBUTABLE TO NON-CONTROLLING INTERESTS 15,051 - 1,083 16,134 … Profit attributable to shareholders - - - … ECONOMIC VALUE DISTRIBUTED TO SHAREHOLDERS - - - … Other administrative expenses (indirect taxes and duties) (-) - 72,411 - 62,446 - 9,965 16.0 Taxes on income (loss) for the period (Current tax, adjustment to current tax of prior years, reduction of - 41,418 - 373,482 332,064 - 88.9 current tax for the year) ECONOMIC VALUE DISTRIBUTED TO PUBLIC BODIES AND INSTITUTIONS - 113,829 - 435,928 322,099 - 73.9 Other administrative expenses (donations) (-) - 328 - 747 419 - 56.1 ECONOMIC VALUE DISTRIBUTED TO COMMUNITY AND ENVIRONMENT - 328 - 747 419 - 56.1 B. TOTAL ECONOMIC VALUE DISTRIBUTED - 704,635 - 1,041,849 337,214 - 32.4 Net provisions for risks and charges - 29,159 - 4,498 - 24,661 … Net adjustments to/ recoveries on property plant and equipment - 163,509 - 27,529 - 135,980 … Net adjustments to/ recoveries on intangible assets - 36,167 - 34,431 - 1,736 5.0 Gains (Losses) on investments in associates and joint ventures (for the valuation component 5,586 3,182 2,404 75.5 “impairment/revaluation”, “net impairment losses/reversals”, “other expenses (income)”) Net profit (loss) from property plant and equipment and intangible assets designated at fair value - - - … Impairment of goodwill (-) - 1,673,006 - - 1,673,006 … Income taxes for the period (relating to deferred tax assets and liabilities) 859,840 622,922 236,918 38.0 Profit allocated to reserves 1,761,657 - 23,429 1,785,086 … C. TOTAL ECONOMIC VALUE RETAINED 725,242 536,217 189,025 35.3 Figures in thousands of Euro

33 SOCIAL REPORTING

• Social responsibility in Banca Carige responsibility, implementing policies and actions Initiatives aimed at listening to customers, carried out • Dialogue with stakeholders able to drive its daily organisational behaviours, on a regular basis, revealed the importance attached through well-established procedures, targeted to relationships: the best comments were expressed investments and an efficient control system. on the bank’s employees, outlining a shared and SOCIAL RESPONSIBILITY IN BANCA This section aims at analysing the relationships with widespread value system (see section on Customers). CARIGE the main categories of stakeholders and with the community as a whole. The concept of Corporate Social Responsibility adopted by Banca Carige consists of the voluntary decision to contribute to the wellbeing of DIALOGUE WITH STAKEHOLDERS communities and the environmental protection, (4.14; 4.16) combining expectations and sensitivity in any corporate activity and when interacting with its By constantly applying its core values, the Group is stakeholders. able to build long-term and trustful relationships The Code of Ethics identifies the main stakeholders with every stakeholder. To develop relationships towards which the Group is committed to acting based on principles of fairness and professionalism, in a socially responsible way. This means that the it is essential to understand and meet the legitimate Bank undertakes to meet timely and accurately needs of the stakeholders. This continuous process the legal obligations arising from the regulations includes communication, in-depth analysis, governing its activity, while focusing on the needs discussion and sharing realized in accordance with and expectations of the community with a view the procedure provided for in statutory or regulatory to creating a corporate climate of consensus and frameworks (shareholders’ meetings, interaction collaboration in order to promote the achievement and meetings with the financial community, and maintenance of income and competitive debates with Unions) and through internal practices The ongoing project “Distillare, vivere, comunicare i advantages. (customer satisfaction surveys, market researches, valori di Carige” (Instil, live and share Carige’s values) Carige’s mission and core values are the inspiration institutional and internal communication supports). was launched in 2008. It involved all employees and for a strategy of proactive, engaging and cooperative resulted in a deep listening, reflection and sharing of relationships with stakeholders. Therefore, Banca the corporate values (see section on Employees). Carige is committed to acting with attention and

34 Customers Community

Households, Businesses, Public Bodies Local communities, institutions, Communication: associations, schools and university, Italian www. gruppocarige.it, reports, advertising Banking Association (ABI) campaigns, social networks, press, institutional and commercial videos; Listening through social channels and periodical corporate publications networks, workshops and industry meetings, Assistance and advisory services: customer participation in debates/conferences, service and customer care, contact center, periodical corporate publications client complaints Customer satisfaction: surveys and Attendance in working tables and technical customer satisfaction monitoring committees, press releases and conferences, Financial education: conferences, Website, market research activities www.gruppocarige.it/gruppo/html/ita/ education Educational programme for schools

Employees and Co-workers Shareholders and Investors

Internal communication: house organ, Direct interaction with the financial community, corporate intranet, web TV, magazines road show, press releases, conference calls, Particular initiatives: employees’ Club presentations, specific website section Listening: surveys and opinions on specific Shareholders: meetings free phone number, topics via intranet direct interaction with the Bank’s General Industrial relations: daily interaction, Trade Secretariat, specific website section Union meetings, working tables, negotiations Communication: financial statements, Surveys on skills and training periodical reports, letters to shareholders

35 SOCIAL REPORTING – CUSTOMERS

• Policies and core values investments by borrowing and lending money to corporate website. • 2013 key figures and from families and companies. Quality of the service provided and customer • Customer segmentation Hence, the 2014-2018 Business Plan reiterates the satisfaction are constantly monitored, also via the • Fair proposals customer-oriented approach, especially focused reporting of the unit devoted to handle customer Quality on households and SMEs. This is the driver guiding complaints. In selecting customers to have a Communication and transparency Banca Carige’s activities, around which highly commercial relationship with, the personnel must Consumers’ health and safety qualified and innovative offers will be designed reject all forms of internal or external influence • Products and services with social purposes to meet the traditional or evolving needs of the that may affect the decisions in a non-compliant Access to credit and support to households customers. way with the corporate interest or the principles of Access to credit and support to businesses fairness and transparency set forth in the Code of • Contact and listening channels Ethics. Customer satisfaction Compliance with the Code of Ethics Complaints In view of strengthening the trustful relationship POLICIES AND CORE VALUES with customers and promoting the Bank’s brand, any relationship with customers shall be built on All activities of the Banca Carige Group are aimed loyalty, transparency and confidentiality, ensuring at constantly improving quality and achieving courtesy and professionalism. customers’ full satisfaction. Within the limits of their responsibilities, all The aim is to establish a lasting and mutually trustful employees are expected to stay informed and up- relationship with each customer through a sales to-date in order to offer customers a satisfactory approach based on transparency, reliability and service and therefore encourage their informed accountability. choices. In this perspective, employees which Therefore, the Group interacts with its customers in interact with customers shall provide them with a structured way, responding with its products and clear, complete and comprehensible information, services to a growing number of needs and boosting so far as possible. Contractual terms and the innovation of products and services. characteristics of the products offered by the Bank Banca Carige is aware that its activity serves a are properly publicised according to the existing social interest, based on transforming savings into legal framework and are generally available on the

36 2013 key figures CUSTOMER SEGMENTATION (FS6) 2 million Group customers in 2013 Over 1,100,000 Bank customers Individual customers breakdown by age Customer breakdown by legal status of which 85% current account holders 45% customers of Ligurian branches around 90% individuals 0-25 years Cooperatives Public bodies around 10% businesses 5% Partnerships 3.4% over 75 years 0.2% Over 67% have been customers for more than 10 14.7% 2.1% 9.7% 26-35 years years Corporations 2.9% around 93% of customers satisfied or very satisfied

56-75 years 32% Individuals 38.6% 91.4% 36-55 years

Customer geographic distribution Customer breakdown by seniority

Other regions 6.9% Up to 1 year Sicily 4.2% 9.8% 11.9% From 1 to 5 Latium 6.3% years

45.2% Liguria Tuscany 11.9% 13.9% From 5 to 10 years Over 10 67.3% years Emilia Romagna 1.9% 6.7% Veneto 8.7% 5.1% Piedmont Lombardy

37 Fair proposal (FS15) the competitors’ conduct. In this respect, the Bank use of advanced technologies and the increasing participates in workshops and events organised by expertise of human resources. All this resulted in Banca Carige’s sales policy is designed on responsible industry associations. achieving ISO 9001:2008 certification for “Planning criteria, leading to the development of: and provisioning of treasury and cash services”. • a wide range of products and services consistent with the principle of serving the needs and The certificate guarantees that about 800 services interests of its customers, based on transparent handled by the banks of the Group are managed via a and fair conditions; system reviewed regularly by the Certification Body, • a series of initiatives aimed at supporting local to ensure the validity of the certificate obtained. communities and the economy of the areas where the Group operates. Communication and transparency Quality (FS15) Communicating with customers is a key factor The Banca Carige Group has implemented a specific to establish a trustful relationship based on process for the development of new products and transparency and clarity. services and the improvement of those existing, with In this respect, the Banca Carige Group, in line the aim of delivering top-quality products which with the Code of Ethics and the existing laws, is comply with the industry regulations and are price constantly committed to assuring transparency of competitive, being supported by a proper technology products and services offered to the clients, during structure to allow a multichannel distribution. their whole life-cycle. (PR3). The policy relating to the design of products and • Promoting initiatives are examined by the services is aimed at meeting needs and expectations relevant departments to ensure compliance of the Bank’s customers and it involves several with the regulations over commercial practices, corporate units in their area of expertise: with specific regard to privacy, transparency and • both “product factories” and “business consumer protection. In drafting the advertising segments” in relation to technical issues and messages, even through external advisors, relations with target customers; the Code of Marketing Communication Self- • Legal and Compliance departments for issues Regulation is applied. (PR6) related to primary and supervisory legislation, as well as internal regulations. • At the pre-contractual stage, specific measures The focus on quality is an integral part of the to identify the potential customer’s financial In order to constantly monitor the quality of the corporate culture aimed at providing high-quality needs are implemented in order to provide a offer, Carige promotes systematic customer services thanks to a customer-oriented approach, tailored and sustainable solution. satisfaction surveys and a constant monitoring of the constant improving of the organisation, the

38 • For the purposes of enabling customers to • The Group provides clear and comprehensive In 2013: make informed choices, the Banca Carige Group information about the modalities for the • no case of non-compliance with regulations discloses information on the bank transparency submission of a complaint and for contacting and voluntary codes concerning products and as established by the legislation in force, to all independent bodies to solve disputes (e.g. services information and labeling of products branches and in the corporate website. Banking and Financial Arbitrator). and services was recorded (PR4) • no case of non-compliance with regulations • In drafting contracts, priority shall be given PattiChiari Consortium or voluntary codes concerning marketing to an easy-to-read style, highlighting the communications, including advertising, most burdensome terms and conditions for Since 2008, Carige has been adhering to the initiative promotion and sponsoring was recorded (PR7) customers. In 2013, the Bank of Italy issued a “Commitments to Quality”, a project promoted • no case of non-compliance with regulations or new measure on the statement of the Annual by the PattiChiari Consortium, launched in 2003 voluntary codes on products and services safety Percentage Rate of Charge (APRC) for credit for improving relations with retail customers. The was recorded (PR2) lines, which the Group banks have transposed initiative is aimed at supporting this customer • an administrative sanction in the amount of EUR into the information sheets and in the contracts. segment to better understand banking products, 2,428 was imposed for a delayed subrogation of providing a basis for consumers to make informed a mortgage (PR9) • The Bank conveys timely and complete choices, being aware of related implications and information on current business relations and comparing easily different solutions. No case of anti-competitive behaviour, antitrust any possible changes in the terms and conditions In the near future, the Consortium will deal with and monopoly practices (S07) or sanctions for non- or any amendments to existing contracts. existing activities until their completion and, in compliance with laws or regulations (S08) were Customers may obtain at any time the updated particular, with the litigation related to the publication registered. version of the contract reporting the economic of a list of low-risk and low-yield bonds, no longer conditions applied. published. At the same time, the management of self-regulatory initiatives (Commitments to Quality) • Pursuant to the Markets in Financial Instruments will be transferred to the Italian Banking Association, Directive (’MiFID’), the Bank ensures the highest while the financial education programmes will be level of protection on investment decisions, handled by a dedicated structure (Fondazione per verifying adequacy and consistency with the l’educazione finanziaria e il risparmio - Financial investment profile and degree of experience of Education and Savings Foundation), established in the investor. 2014.

• Potential conflicts of interest arising from a Group relationship and/or business relations with external entities are clearly outlined. Compliance

39 Health and safety of consumers Furthermore, Carige provides its borrowers with an Physical Safety Assessment of the security of products and services insurance policy covering, inter alia, the protection (PR1) of heirs in case of premature death of the debtor. The policy of the Group provided for the adoption by all the banks of the Occupational Health and Safety Particular attention has been paid to improve Privacy Management System as per BS OHSAS 18001:07 security relating to the use of payment cards and standard, specifically aiming at minimising the risks online services. Payment cards are equipped with The Group has paid particular attention to the to which employees, customers and other third state-of-the-art microchip technology. Transactions issue of privacy, as from the entry into force of the parties (suppliers, visitors, etc.) having access to the are constantly monitored in order to detect any regulations on personal data protection, currently company premises might be exposed. abnormal behaviour. Banca Carige offers free contained in the Legislative Decree no. 196/2003 SMS alert services, a dedicated toll-free number “Personal Data Protection Code”, including data available 24/7 in Italy and specific phone numbers security against the risk of destruction, loss, for those calling from abroad, to be used in the event unauthorised or unpermitted access. of loss and theft, for which an appropriate insurance In this perspective, the banks of the Group drew up cover is however provided. Different security levels technical and organisational measures involving all are implemented to protect customers when using employees and third parties who could have access internet banking and mobile services at the various to personal data handled by the Group. The roles of stages (operating ceiling, passwords, etc.). the subjects who may process, in several respects, the personal data held by the Group banks under ATM and POS terminals installed at the customer’s the Code will be formalised in a manner appropriate premises are equipped with state-of-the-art to each case. In particular, all staff is responsible technologies in order to ensure the safety of users. for the data processing and receives training and instructions as to the conduct in this context. Consumer safety is enhanced by the availability of insurance products which protect customers, Business Continuity offering a guarantee covering the sum due under a mortgage loan, through: In June 2013, the Board of Directors approved the • a term life insurance that, in the event of death, “Business Continuity Policy” while the “Business ensures the payment of a sum equal to the Continuity Plan” was updated. The primary objective residual outstanding debt under the terms of the Business Continuity Policy is to outline provided for in the contract; guidelines, principles and requirements to be • a non-life insurance, consisting of a series of implemented within the Group in order to guarantee guarantees related to possible events that may the continuity of the functions and critical business hinder the payment of the outstanding debt services in the period immediately following a (disability, unemployment, etc.) disaster.

40 PRODUCTS AND SERVICES WITH A SOCIAL PURPOSE (FS7)

Access to credit and support to households The Banca Carige Group is committed to providing concrete support to the households that, due to the economic crisis in recent years, have lesser access to credit or find it difficult to pay their financial obligations. The Banca Carige Group has joined several initiatives developed over the last few years at both national and local level.

EUR 1.6 million granted Memorandum of Understanding signed between the Italian Banking Association (ABI) and the Ministry of Youth in order to help THE YOUNG COUPLES FUND since December 2011 young couples or households with underage children to obtain loans for purchasing their first home.

This fund was established on the initiative of the Ministry of Economy and Finance and made operative in 2010 with the purpose of 309 applications increasing the financial sustainability of the mortgage loans granted to families. It provides for a suspension of mortgage instalments accepted for a total THE SOLIDARITY FUND for up to 18 months upon the occurrence of unfavorable events that reduce the repayment capacity of mortgage holders. The Fund, of EUR 240 mln suspended in July 2012 owing to depletion of financial resources, was re-activated in April 2013 on a wider scope of application and since November 2010 on terms more favourable to the customer. Around EUR 700,000 Established thanks to a contribution by FI.L.S.E. SpA (Finanziaria Ligure per lo Sviluppo Economico – Ligurian Financial Company for worth of loans LOANS ON TRUST the Economic Development) for the benefit of Ligurian residents facing temporary distress and serious economic difficulties. used at the end of 2013

Out of the allocated total UNEMPLOYMENT BENEFITS In 2013 the agreement with FI.L.S.E. SpA was renewed for granting overdraft facilities to workers living in Liguria made redundant or amount, EUR 114,000 worth AND THE REDUNDANCY receiving an unemployment benefit or certified as “exposed to asbestos”. FUND of facilities were used at the end of 2013

THE ABI-CEI AGREEMENT (BETWEEN THE ITALIAN This agreement, extended in 2013 to Banca Carige Italia as well, grants micro-credit facilities to households in difficulties due to EUR 74,000 of the relevant BANKING ASSOCIATION the economic crisis, as foreseen in the Framework Agreement signed between the Italian Banking Association (ABI) and the Italian budget were used by the AND THE ITALIAN BISHOPS’ Bishops’ Conference (CEI). CEI offers a 50% guarantee provided by the Fund specially set up, which is managed by Banca Prossima. end of 2013 CONFERENCE)

Banca Carige supports households in difficulty facing usury risk, also on the basis of an agreement signed with the Anti-Usury 95 eligible applications for ANTI-USURY FUND Foundation “S. Maria del Soccorso”, a non-profit organization founded in 1996 at the initiative of the former Archbishop of Genoa, over EUR 800,000 during Cardinal Dionigi Tettamanzi. 2013

41 The Household Plan

The “Household Plan” is an agreement between ABI (Italian Banking Association) and various consumer associations aiming at enhancing the financial sustainability of mortgage loans granted to families. This agreement provided for the suspension of instalments, for up to 12 5,600 applications months, relating to mortgages granted for the purchase, construction and restructuring of the accepted over the main house in case of particular events such as job loss, temporary layoff, death of a salary years, for a total of EUR earner within the family or loss of self-sufficiency which could reduce the borrower’s ability to 319 mln repay the debt.

As of November 2010, the Banca Carige Group has resolved upon an extension of the terms under the Household Plan:

• increase from € 150,000 to € 250,000 of the maximum amount granted for mortgage loans subject to suspension request; • a major scope extension: mortgage loans granted to natural persons, artisans, retailers, From January to March professionals (with VAT number), regardless of the purpose and the asset charged by way of 2013, 820 applications guarantee (i.e. not only the main house); accepted for a total of • abolition of the maximum taxable income for applicants (currently not exceeding € 40,000 EUR 75 mln yearly); • possibility to apply for subjects who experienced, or could experience, events triggering a temporary situation of financial difficulty, even not included in those aforementioned.

42 Various initiatives addressed to specific targets

Due to the ongoing economic crisis, the Pledge Loans have also acquired a social function. An increasing number PLEDGE LOANS of individual customers, usually ranged in low-middle classes, turn to the four branches of the Group which EUR 15 mln loan worth by the end of 2013 facilitate access to immediate loans against pledge of valuables (gold, precious stones, silver).

“CONTO BASE” Basic Account fosters the financial inclusion of low-income segments of society. Since 2012 Banca Carige – reflecting the “Salva Italia – Save Italy” Decree – has been selling its “Carige Basic Account”, as defined in its contents by the agreement signed among banks, Italian Banking Association (ABI), Ministry of Economy and CONTO BASE” BASIC Finance (MEF), Poste Italiane (the Italian postal service), payment institutions and E-Money. 650 bank accounts by the end of 2013 ACCOUNT The Basic Account is designed for a simple management of credit entries (salary or pension) and payment transactions. In order to support the socially disadvantaged classes, the Basic Account charges no fees or stamp duty.

Carige offers special current account conditions to pensioners, who may freely benefit from insurance and At the end of 2013, more than 1,900 current FINANCIAL PRODUCTS FOR assistance services “Linea Seniores” provided by Carige Assicurazioni to cover theft, mugging and robbery risks, accounts and 70 savings deposits associated PENSIONERS as well as legal liability and accident. with the offering

“Stile Facoltà” current account which includes no maintenance fees for three years from its opening date. 3,000 accounts opened in 2013

Financing for training secured by the Fund for Study guaranteed by the Italian Government. EUR 75,000 granted in 2013 FINANCIAL PRODUCTS FOR YOUNGER GENERATIONS AND STUDENTS Banca Carige Group joins various initiatives planned by “Diamogli Futuro” - “Let’s give ‘em a Future”, (Memorandum of Understanding signed between the Italian Banking Association (ABI) and the Ministry of Youth) on job, home and training issues.

The proposal for immigrants is geared to facilitating money transfers to their country of origin and it includes the longstanding remittance service to Ecuador, provided in cooperation with Banco Bolivariano, and the new service for transferring money to Peru and Morocco, on favourable terms and in a short timeframe. FINANCIAL PRODUCTS FOR IMMIGRANTS The Group offers to its foreign customers a whole range of services, from the current accounts – which can be opened in the name of non-residents as well – to personal loans and mortgages.

43 Initiatives to support victims of natural disasters Flood in Sardinia

• As a sign of solidarity with the communities of Emilia Romagna, which were affected by the severe A real help for families and businesses earthquake in 2012, the Banca Carige Group joined the agreement between Italian Banking Association (ABI) and Cassa Depositi e Prestiti to grant subsidized loans in favour of damaged people for payment of taxes, Banca Carige Italia allocates a total amount of EUR 10 mln health and social security contributions as well as premiums for compulsory insurances. In January 2013 to support families and businesses hit by recent floods the Carige Group and Cassa Depositi e Prestiti signed an agreement providing for loans at favourable terms in Sardinia. to the earthquake victims in order to finance repair, renovation and reconstruction interventions on either The loans will be provided on particularly favourable residential or commercial buildings, within the available ceiling of EUR 6 bn. The Group granted EUR 718,000, terms; the Group has also decided not to apply any spread over 13 transactions referring to 5 applicants. administrative fees or instalment collection charges on such loans. • The subsidiary bank Cassa di Risparmio di Carrara granted loans on favourable terms to individual customers The loan eligibility procedures are swift: it will be sufficient and industrial, commercial, craft, agricultural, service and tourism/hotel companies who suffered damage to submit a self-certification of damage incurred, via a during the earthquake in Tuscany (June and July 2013). The bank also approved some forms of suspension form available at the branches of Banca Carige Italia in of instalment payments for individual customers; damaged businesses have been allowed to suspend the Sardinia. repayment of the principal on both mortgages and equipment and property leasing. Commission-free donations can be made at • With regard to the flood events and the disasters which hit the provinces of Brescia, Cremona and Mantova Caritas Diocesiana di Tempio Ampurias in July 2013, the Group allocated a total amount of EUR 40 mln; low-interest loans were also provided to Iban: IT43 D034Alluvione 3185 0800 0000 0284 780 Banca Carige Italia SpA, branch of Tempio Pausania help individuals and companies who suffered major damage during the exceptional rainfall in Sardinia on 18th in Sardegna November 2013. As a result, the former amount was increased by a further EUR 10 mln.

• In view of supporting the populations affected by the unexpected surge of bad weather that hit Tuscany on 20th, 21st and 24th October 2013, and in accordance with the Order no. 134 issued on 26th November 2013 by the Head of the Civil Protection Department, customers holding loan contracts with the Group’s consumer credit company (Creditis) had the possibility to request a 8-month suspension of their repayments. The same facilitation was granted to borrowers living or having their registered office in the damaged municipalities. In this case, although the Order established a 8-month suspension, the Group decided for a 12-month facilitation, without prejudice to the possibility for all clients to renounce the suspension before expiry of its term, upon request. Un aiuto concreto per famiglie e imprese Banca Carige Italia mette a disposizione 10 milioni di euro per sostenere famiglie e imprese colpite dall’alluvione in Sardegna. Finanziamenti a tasso agevolato a zero spese di istruttoria e riscossione.

Per accedere al finanziamento porta l’autocertificazione dei danni subiti in una filiale sarda di Banca Carige Italia.

Se vuoi dare il tuo contributo 44 puoi fare una donazione alla Caritas Diocesiana di Tempio Ampurias Codice Iban: IT43 D034 3185 0800 0000 0284 780 Banca Carige Italia SpA, Filiale di Tempio Pausania

Messaggio pubblicitario con finalità promozionale www.gruppocarige.it Access to credit and support to businesses

SUSPENSION OF On 1st July 2013, ABI and the main business associations signed the “Agreement for Credit to SMEs 2013”. This agreement, covering the period EUR 830,000 INSTALMENTS AND up to 30th June 2014, is designed to ensure that appropriate financial resources are made available to SMEs in need of liquidity but with a sound used at end- EXTENSION OF LOAN development potential, paving the way for them to overcome today’s adverse economic cycle. 2013 out of the REPAYMENTS FOR The banks participating in this agreement undertook to grant loans to businesses incorporated as limited liability companies engaging in a BUSINESSES process of capital strengthening. allocated total amount

CREDIT FACILITIES EUR 836,000 FOR INNOVATION- used at end- In 2013, Carige and FI.L.S.E. S.p.A. signed two agreements in order to ensure credit facilities for Ligurian SMEs making innovation-related and RELATED INVESTMENTS store-refurbishment investments. 2013 out of the AND STORE allocated total REFURBISHMENT amount

CREDIT FACILITIES EUR 2.3 million TO ADDRESS NEEDS used at end- FOR LIQUIDITY In the framework of the agreement signed between FI.L.S.E. S.p.A. and Rete Fidi Liguria, the assistance from the Guarantee Fund was extended RELATED TO THE up to the end of 2013 to support micro- and small businesses in overcoming an extraordinary lack of liquidity arising from the economic crisis. 2013 out of the ECONOMIC CRISIS allocated total amount

During 2013, Banca Carige SpA signed new agreements with: AGREEMENTS WITH Cogart Cna, Confartigianato Fidi Piemonte e Nord Ovest, Unionfidi Piemonte and Italia Com-Fidi CREDIT GUARANTEE Banca Carige Italia SpA concluded cooperation agreements with: CONSORTIA TO Artigianfidi Padova, Confida scrl, Fidimpresa Veneto, Soc. Coop.p.a. Fiditurismo Jesolo, Unionfidi Verona Soc. Coop., ACT Soc. Coop., Fidi PROMOTE CREDIT Toscana - S.p.A., Unionfidi Lazio S.p.A., Interconfidi Med, Società Finanziaria Regione Sardegna - S.p.A., Unionfidi Piemonte, Italia Com-Fidi, ACCESS FOR Creditagri Italia. BUSINESSES

45 CONTACT AND LISTENING Group and the quality of the service provided. • image (trust, customer-oriented approach, innovation). CHANNELS Metrics Key Findings The Banca Carige Group has based its service model The banks of the Group have taken part in a research on a multi-channel scheme, which is constantly study conducted by the Italian Banking Association, The survey revealed, for all the banks of the Group, evolving in terms of available channels and ABI, in cooperation with Gfk Eurisko on “Customer a general improvement in the global satisfaction functionalities. Satisfaction in Retail banking”. (overall), especially with an increase in the highest This model allows customers to access bank satisfaction rates (7 and 8 on a scale from 3 to 8) for services in the most effective and comfortable way Respondents Banca Carige and Banca Carige Italia. and timing, meeting theirs needs while maintaining This result is even more relevant when considering a constant standard of the service offered through In May 2013, a phone survey was conducted on a the extremely complex economic context. different channels. sample of more than 1,400 customers aged from 18 In line with tradition, the employees obtained the Within this model, the Contact Center is not only one to 74 (480 in Banca Carige, 720 in Banca Carige Italia best rating and the most significant improvements of the possibilities made available to customers to and 80 in each other subsidiary bank). were achieved in areas like environment and develop their business activities, but it is also and welcoming atmosphere, in the cost/efficiency ratio especially a vehicle for development and customer Topics under consideration and image. retention. The Overall Satisfaction Index (overall) for every The Contact Center, whilst covering assistance Different aspects of the bank/customer interaction: Bank of the Group is significantly higher than the activities and commercial development of the average result attributed by the ABI/Gfk Eurisko customer base, has become an instrument for taking • branch (organisation and efficiency, survey to the banking sector as a whole. care and listening to clients, as well as a reference environment and atmosphere); point for collecting and managing customer’s claims • operational staff (skills and efficiency, politeness Retention Rate and complaints. and understanding of the client’s needs); • contact person (helpfulness, professional In order to establish when customers’ trust becomes Customer satisfaction (PR5) attitude, efficiency); actual loyalty, the retention rate (i.e. the ability to • information (punctuality, correctness, maintain the existing customer base, calculated The analysis of the dynamics driving the relationship transparency); as the ratio between the total clients at the end between the client and the bank plays a strategic role • quality of the service provided; of the year, already in the bank earlier in the year, for the Banca Carige Group, which promotes yearly • investment management (information, support, and the total clients at the beginning of the year) is specific surveys aimed at monitoring the ‘climate’ profitability); systematically monitored. In 2013, the percentage of the relationship and at measuring, through a • products and services (quality and broadness of of account holders of the Group raised up to 93.7% fine-tuned assessing model, the satisfaction level range); (93.5% in 2012). perceived by customers about the Banks of the • cost/efficiency ratio;

46 The benchmarking analysis for the sector, to which Complaints by type Banca Carige has been participating for many Insurance years (ABI/SDA Bocconi Customer retention and products Other commercial performances of the banks), shows 3.6% that customers’ loyalty rates are generally higher Debit/credit 2.3% cards 8.2% than the average results attained by the reference Current accounts sample. 32.3% and saving deposits Collection Handling of Complaints 20.6% and payment Managing complaints through a rigorous evaluation services and a prompt and detailed analysis of the claim received allows the identification of suggestions for 4.9% improvement of the organisational procedures, the Investment 28.2% services Loans and commercial offer and interpersonal aspects. mortgages The complaint handling in Banca Carige has been managed by a dedicated dept. since April 1993, by adhering to the Agreement for the establishment of Complaints by reason the Complaint Bureau and the Banking Ombudsman Other signed in ABI. Employees 5.1% 5.3% Organisational issues In 2013, 1,152 complaints about products and services 4.5% offered by the commercial network of the Group Execution of were received, as detailed in the table below, along 31.7% transactions with the reasons for the complaint. In 2013, For Terms and conditions 13% most complaints (89%), whose processing time is set up at 30 days, the average time of reply was 24 Communication and days. Furthermore, in 2013, no complaint related to information 7.9% privacy violation was filed.(PR8) 12.2% Application of terms and Compound interest 6.1% conditions 3.8% 4.4% Reports to the Central Credit Register 2.4% 3.6% Fraud and loss Equipment Creditworthness or similar malfunctioning

47 SOCIAL REPORTING – COMMUNITY

• Policies and reference values The Banca Carige Group plays an important role Distribution of interventions • Socially valuable initiatives in the development of the social, economic and • Promotion of the territory environmental context where it operates, also • Culture promoting healthier lifestyles and encouraging the Other

• Publishing initiatives broadest access to any type of sports. 3.5% 15.8% Sport • Initiatives in collaboration with institutions and Furthermore, often in cooperation with other Institutions and organisations representatives of the business community and the categories • Sport academic world, the Group takes part in dialogues 22.4% • Financial education and cooperation with and discussions on current topics regarding 10.6% Community schools the economic and financial world through the • Cooperation with trade associations organisation of meetings, events and round tables. • Treasury and cash services 10.7% Territory

Culture 21.5% SOCIALLY VALUABLE INITIATIVES 5.6% Non-profit entities POLICIES AND REFERENCE 4.8% 5.1% Religious entities VALUES During 2013, the contributions (sponsorships, Conventions donations and other initiatives) in favour of local The Banca Carige Group has always been committed communities reached almost EUR 6 mln (EC8). locally to contributing to the citizens’ individual The Group’s interventions have been aimed at and social life by promoting initiatives aimed at strengthening the image of a bank focused on sustainability, which may foster a balanced growth the needs of the territory, following a logic of and a better distribution of welfare and contribute multilocalism, local peculiarities and flexibility. to the spreading of cohesion and solidarity. Art, music, literature and publishing constitute the identity of a community, reflecting culture and traditions. For this reason, the Group dedicates part of its socially responsible initiatives to the promotion of cultural events in different fields, fostering the involvement of a wide and diversified audience.

48 Promotion of the territory • Teatro Civico di La Spezia • Teatro Cavour di Imperia In 2013 Banca Carige’s partnership with the ‘Fiera • Teatro delle Muse di Ancona di Genova’ Trade Fair, which provides for the Bank’s constant presence at several events, culminated In 2013 Banca Carige confirmed its support to in the Bank’s traditional main sponsorship of “La tastiera Italiana”, a project by pianist Andrea Genoa International Boat Show, one of the main Bacchetti in collaboration with music historian Mario international exhibitions of the industry. Marcarini, produced by Sony Music Entertainment Italy, to bring ancient unpublished manuscripts The Cassa di Risparmio di Savona has participated of Italian composers back to life. After a thorough as the main sponsor in Expo Savona 2013, the major selection process, the compositions chosen are terrirorial marketing showcase of the province, recorded on CD and published. which sees more than one hundred thousand visitors every year. During this year, the specialists focused their work on the analysis of several musical manuscripts by Culture Johann Adolph Hasse, a composer of German origin but Venetian by adoption. Banca Carige Italia has sponsored the 2013 edition Among the initiatives aimed at supporting the of the Uto Ughi per Roma music festival, which has musical culture, Banca Carige has also organised been held since 1999 with the aim of drawing young and supported some concerts in Genoa and Brescia, people to classical music. which were played by pianist Bacchetti during the year. Among the other initiatives, the festival includes free concerts in churches and theaters in Rome, a charity In April 2014, the Genoese pianist won the gala in favour of Save the Children, an intensive International Classical Music Award in Warsaw, which course for young musicians and an open rehearsal is one of the most prestigious European awards in for students. the classical music elite, as recognition of the best baroque music CD (“Domenico Scarlatti”) published For some years now the Banca Carige Group has in the international recording scene; this CD is been sponsoring the theatrical season of important included in the editorial line “La Tastiera Italiana”. theatres, including: • Teatro Stabile di Genova • Teatro della Tosse di Genova

49 The initiatives for culture promotion included in 2013 the organisation of the 29th edition of the National Literary Prize for women authors “Rapallo Carige”. It is the only prize in Italy dedicated entirely to female literature and

it has now become a reference point in the national literary scene. Premio Letterario Won in 2013 by Emanuela Abbadessa with her book “Capo Scirocco”, “Rapallo Carige” has represented over the Nazionale per la donna scrittrice years an important showcase for many female authors. Writers like Susanna Tamaro, Rosetta Loi, Margaret 2 013 Mazzantini, Edith Bruck, Laura Mancinelli, Francesca Duranti, Giuliana Berlinguer, and many others, have won the first award since as from 1985.

......

Cassa di Risparmio di Carrara supports the Fondazione Città del Libro di Pontremoli, which promotes the prizes ‘Bancarella’,’Bancarellino’, ‘Bancarella Sport’ and ‘Bancarella della Cucina’. Moreover, Cassa di Risparmio di Carrara has also confirmed its support to the Symphony Orchestra of Massa Carrara.

......

Banca del Monte di Lucca, among the other initiatives, offered its support to the 59th Puccini Festival in Torre del Lago.

50 Publishing initiatives

In collaboration with the Foundation, Banca Carige dedicated the 2013 gift book (the traditional book which the Bank offers as Christmas gift to its shareholders and selected clients) to “Genova e il Jazz” (Genoa and the Jazz). Edited by Egidio Colombo, Guido Festinese, Giorgio Lombardi and Adriano Mazzoletti, the book covers the events and initiatives relating to jazz that have been taking place in Genoa since the 1920s, from the first pioneers up to the present multitude of initiatives and specific associations, among which the “Museo del jazz” (Jazz Museum) dedicated to G.B. Gianni Dagnino, historic president of the Cassa di Risparmio di Genova e Imperia......

Cassa di Risparmio di Carrara, in cooperation with the homonymous Foundation, has published the book “Domenico Zaccagna (1851-1940). Il marmo: l’imprenditoria, l’arte, la scienza” (Marble: entrepreneurship, art, science). Edited by Luisa Passeggia, the book is dedicated to the great geologist and engineer from Carrara who worked for more than 50 years in the Italian National Geological Service. He participated in railway projects, the construction of artificial lakes which substantially contributed to the development of the Italian hydroelectric industry, as well as in several architectural projects, among which the present headquarters of Cassa di Risparmio di Carrara......

Banca del Monte di Lucca, together with the homonymous Foundation, has promoted “Versilia,100 anni di cinema” (Versilia: 100 years of cinema), gift-book edited by Glauco Borella and Vincenzo Placido. The book analyses the relationship between the Versilia area and the cinema, providing a bibliography on the subject, with the summaries of all movies shot in this territory from 1913 to date, and revisiting the various locations used during the filming from an historical, architectural and environmental point of view. Moreover, a second book was published, completing the previous one, providing a contribution to the rediscovery of the history of the films produced around Lucca in the 20th century......

In 2013, Banca Carige renewed its commitment to the publishing industry by promoting the culture and information magazine, “La Casana”, with the aim of enhancing the cultural and artistic heritage of the areas in which the Group has a footprint.

51 Initiatives in cooperation with institutions and Particularly appreciated was also “Vetrine d’artista”, organisations the exhibition of works by both the finest th20 century painters and emerging artists from Savona, Banca Carige edited two specialised journals promoted by the Cassa di Risparmio di Savona in “Economia e diritto del terziario” (Law and collaboration with the “Renzo Aiolfi” association, Economics in the Services Industry) and “Prospettive held at the Bank’s Head Office in Corso Italia. dell’economia” (Economic outlook) in collaboration with the University of Genoa. In September 2013, the 8th edition of the “Con- vivere” festival dedicated to Latin America, from For the enhancement of its artistic heritage, Carige Mexico to the Tierra del Fuego, was organised took part in the 12th edition of “Invito a Palazzo”, in collaboration with the Fondazione Cassa di an annual event promoted by the Italian Banking Risparmio di Carrara. During the festival, journalists, Association, ABI, which allows art lovers and tourists politicians, intellectuals, artists and musicians took to admire the masterpieces in the Bank’s art part in meetings, exhibitions and concerts with a collection, which are usually not accessible to the view to discovering Latin America. public. In 2013 Carige participated in the “Banca e Furthermore, in 2013 it was possible to visit the territorio” award, organised by AIFIn – the Italian historic headquarters of Banca del Monte di Lucca Association for Financial Innovation – with the and the seventeenth century palace of the Monte di aim of promoting the concept of corporate social Pietà of Palermo which today houses Banca Carige responsibility in the financial sector and dedicated Italia’s Area Head Office. to those banks which concretely contribute to the sustainable development of the society and their territory.

In 2013, Banca Carige confirmed its sponsorship for the ‘Automobile Club d’Italia’, ACI (the Italian motor club) by supporting the organisation of the Road Safety Tour, an educational project consisting in several initiatives throughout Liguria, which included public conferences, events, organisation of operational modules and dissemination of information material.

52 Sport In this regard, Banca Carige’s sponsoring programme includes the traditional support The Banca Carige Group has a traditional presence in the world of sport; in 2013 it continued to sponsor the top provided to ‘Stelle nello Sport’ (Sports Stars), an league football teams: event which brings together the supporters of different sports under the same passion. Based • A.S. Livorno Calcio on the successful idea to ask people in Liguria • U.C. Sampdoria to vote for their favourite athlete, involving the • Genoa C.F.C. 1893 regional media, “Stelle nello sport” has become an important driving force for spreading a culture Moreover, sport sponsorships cover important teams of waterpolo (Rari Nantes Savona) and basketball that involves, in particular young people, in a wide (Casale and Reyer Venezia), tennis (Tennis Park of Genoa) and minor football teams. The Banca Carige Group ranging educational project, focused on loyalty, also supports many associations and amateur sports clubs with a view to encouraging sports activities among commitment, respect for others and a healthy life. young people and supporting at the same time small sports clubs, located where the Group has a footprint.

sponsor sponsor dei dell’impegno successi

Da anni supportiamo Da anni supportiamo la il Savona 1907 FBC. Rari Nantes Savona. Una scelta per dare Una scelta per dare concretezza ai sogni e alle concretezza ai sogni e passioni di tanti perchè alle passioni di tanti crediamo che il successo perchè crediamo della città passi anche che il successo attraverso il successo della città passi della sua squadra. anche attraverso l’impegno della sua squadra. www.gruppocarige.it

www.gruppocarige.it

a sostegno del successo dal 1840 a sostegno dell’impegno dal 1840

53 Solidarity

In 2013 Banca Carige provided support to many initiatives side by side with non-profit organisations and religious institutions committed in assisting the different forms of social malaise in the areas in which the Group has a footprint...... “Ricaricaderby” initiative

Banca Carige offered EUR 10,000 for a virtual football match for charitable purposes, involving thousands of supporters of Genoa and Sampdoria (the two football teams of Genova) in a city derby among holders of customised prepaid cards featuring the colours of their teams: riCariGenoa and riCariSamp. Genoa supporters won the match and the proceeds were allocated to the “Gigi Ghirotti” Association.

...... Tempio Ampurias

Banca Carige Italia made a donation to the Caritas agency in the diocesis of Tempio Ampurias, Sardinia, to help the region recover after the flooding.

...... RICARIDERBy. IL DERBY più lungo di sempre. Mettiamoci all’Opera (Let’s take action) La passione per la tua squadra non nisce mai? Dal 15 settembre al 31 gennaio sottoscrivi presso una liale Carige, la carta prepagata della tua squadra del cuore e partecipa al Ricariderby*: Carige devolverà 10.000€ a una ONLUS selezionata dal club con i tifosi più fedeli. As the main sponsor, Carige contributed to the first edition of this solidarity event organised to raise funds against leukemia, organised on 24th October 2014 by MSC Crociere on board of their cruise ship “MSC Opera”, moored for the occasion in Genoa. This event saw the participation of about 1,000 people and, during the charity gala, more than EUR 300,000

were collected and allocated to AIL, a non-profit association, and to the financing of several research projects *Messaggio pubblicitario con finalità promozionale. Fogli informativi disponibili nelle filiali Carige e su www.gruppocarige.it. riCariGenoa e riCariSamp sono disponibili nelle filiali di Banca Carige. promoted by “Gaslini” hospital, “AREO” in Genoa and “MBBM” Foundation in Monza, in order to support the fight against leukemia, lymphoma and myeloma.

54 Financial education (FS 16) gradual approach to the social, professional and As from the beginning of the project, about 200 economic reality around them. This programme “Carige volunteers” were trained by a representative Carige and the economic and financial culture covers topics such as relationship with money and its of the Postal Police and, thereafter, they held lessons management, payment instruments and interaction in their children’s classes, involving almost 2,000 In 2013 Banca Carige once again renewed its with banks, entrepreneurship, management of students from different Italian regions. sponsorship of the annual forum on the Final the individual and family economic future through Considerations by the Governor of the Bank of savings and pension policies. This initiative was Italy, in collaboration with the “EffeBi – Finance & realized in cooperation with Pattichiari Consortium Banking” Association. Since its first edition in 1995, and Carige took part by providing professional this event has now become a regular appointment employees as tutors during the meetings, involving for those involved in the industry and the experts over 1,300 students from the schools of all Ligurian from the academic and financial world. provinces as well as in Como, Catania, Florence and The rich conference programme covered Padua. topical economic subjects of a general nature, in collaboration with the local professional bodies Volontari per la sicurezza in rete and trade associations. In front of an audience (Volunteers for Web Safety) of individual savers and businesses, the bank top management developed subjects of general With a view to running a training programme on the interest relating to the financial markets and the responsible use of new technologies and ensuring real economy. These events took place in Padua, an adequate awareness and information level in Como, Florence, Turin, Venice, Monza, Rapallo, the new generations, the cooperation between the Lucca, Bologna, Palermo and Genoa. With regard to Banca Carige Group and the Postal Police entered more specialised meetings, in 2013 the cooperation its third edition this year. This initiative promotes a between the Bank and the Tax Court Magistrates conscious and responsible behavior when accessing Association was strengthened, by promoting a series the Web, online communities, chat rooms, blogs, of events dedicated to independent professionals social networks as well as when producing and and held in Sanremo, Turin, Genoa and Milan. sharing (through online platforms) any digital content. Carige and the school This project, devoted to children and teens in primary and secondary schools, included an educational and L’impronta economica Teens (The Economic informative lesson on the opportunities offered by Footprint for Teens) is an educational programme the Web, but also on the potential pitfalls, in order for high schools, which aims at introducing students to assure a digital experience based on personal to economic and financial issues through their enrichment and entertainment

55 Cooperation with trade associations (4.13) Banking Association - Associazione Italiana Private At the end of 2013, about 800 treasury and cash Banking (AIPB), the Italian Corporate & Investment services were provided by the banks of the Group to Banca Carige is an active member of the following Banking Association - Associazione Italiana schools and universities, local entities, government- trade associations and consortia: Corporate & Investment Banking (AICIB) and the owned companies, healthcare and social assistance Association for the Planning and Management bodies. • Associazione Bancaria Italiana (ABI) – Italian Control System in Banks, Financial Institutions Treasury and cash services are important Banking Association; and Insurance Companies - Associazione per la instruments to strengthen the Bank’s footprint both • Associazione delle Casse di Risparmio Italiane Pianificazione e il Controllo di Gestione in Banca, in the traditional areas and in the new markets. (ACRI) – Italian Savings Banks Association; nelle Istituzioni Finanziarie e nelle Assicurazioni Contracts concluded between the Group and the • Associazione fra le Società Italiane per azioni (APB). Carige attends working groups (included the reference entities make provision for contributions (ASSoNIMe) – Association of the Italian Joint interbank group on corporate social responsibility), in their favour, therefore allowing them to invest Stock Companies; seminars and conferences organized by the Italian for the benefit of the territory and the community, • Associazione Italiana per il Factoring (ASSIFACT) Banking Association, ABI; in particular, it is a within the respective spheres of competence – Italian Factoring Association; member of ABILAB consortium (Research centre (health, education, local administration). • Associazione Italiana per il leasing (ASSILEA) – and development of technologies for banks) and In 2013, the Group earmarked EUR 2.2 mln in favour Italian Leasing Association; CBI (Customer to Business Interaction Consortium). of the entities to which it provides treasury and • Associazione Industriali (CONFINDUSTRIA) – The Bank also participates with its representatives in cash services, where 62% was allocated to support Italian Industrial Association; technical committees and working groups organized institutional activity or to sponsor initiatives of local • Associazione Italiana degli Istituti di credito su by ABI. bodies, 22% to entities operating in the health sector, Pegno – Italian Association of Collateral Loan Lastly, Banca Carige is a member of Impresa Sociale 7% to public education sector and the remaining 9% Institutions; – Strategie d’impresa per il bene comune S.r.l. (Social to other entities. About 76% out of the total was • Conciliatore Bancario Finanziario – Banking and Enterprise – Corporate Strategies for the Common destined to Liguria-based subjects. Financial Ombudsman; Good), a company whose corporate purpose is The Group cooperated, within ABI, with the Ministry • Consorzio Bancomat – Bancomat (ATM) to contribute to forming an entrepreneurial and of Education, University and Research, for the consortium (formerly COGEBAN Association); managerial awareness in order to gear business introduction of the “Ordinativo Informatico Locale • Fondo Interbancario per la tutela dei Depositi strategies towards a common good, enhancing (OIL)”, a computerised payment service specific (FITD) – Interbank Deposit Protection Fund; corporate competitiveness mechanisms. for schools, and for the provision of the electronic • Fondo Nazionale di Garanzia – National storage and archiving of digital documents within Guarantee Fund. TREASURY AND CASH SERVICES the cash service provided to schools. These interventions are aimed at saving resources, Furthermore, Carige is a member of other Treasury and cash services represent a strength of enhancing the efficiency and reducing operational associations and organisations pertaining to its the Banca Carige Group, under which a high degree risks for schools, in the framework of the statutory business activities (planning, finance, foreign trade, of professionalism and specialization has been project relating to e-government. marketing and others), including the Italian Private reached.

56 SOCIAL REPORTING - SHAREHOLDERS

• Policies and reference values The evolving context required the launch of a Below are listed the investors owing more than • Composition of the share capital capital strengthening process with a subsequent 2% of the share capital, updated according to the • Annual results capital increase, that will lead to a redefinition of the Shareholders’ Register and the last notices received • Investor Relations activity corporate structure. as at 10/06/2014. • Dialogue with shareholders • Rating COMPOSITION OF THE SHARE Shareholders Shareholders with ownership percentages higher POLICIES AND REFERENCE CAPITAL than 2% of the share capital Fondazione Cassa di VALUES As at 31/12/2013, the Parent Company’s share Risparmio di Genova capital, subscribed and fully paid up, amounted to e Imperia (*)

In its relationship with shareholders, the Banca EUR 2,177,218,841 and consisted of 2,174,664,623 18.999% Carige Group aims to create “sustainable value”, ordinary shares and 2,554,218 convertible savings which means pursuing long-term objectives that shares. meet criteria of stability and profitability so that the Group can hold true to its traditional mission of At the end of 2013, the shareholding structure of the 9.989% BPCE IOM SA 71.012% supporting the socio-economic development of the Group was composed of: Other local areas it operates in. shareholders Carige’s corporate structure has been traditionally • Fondazione Carige, whose institutional activity based on the historical capital shareholding is focused on supporting initiatives in art, by Fondazione Cassa di Risparmio di Genova e culture, scientific research, health welfare and Imperia, which has represented over the years an social security; important means of action in favour of the local • BPCE IOM SA, a subsidiary of the Group Banque social initiatives and the broad shareholder base, Populaire et Caisse d’Epargne, one of the most mainly concentrated in the typical areas where the important French banking groups; (*) of which 6.971% Mediobanca Spa (borrower) banks of the Group operate. Starting from the last • Broad-based shareholding, with approximately few months of 2013, the Bank’s main shareholder, 55,000 investors. Fondazione Carige, has progressively reduced its share in Carige.

57 Shareholder Shares Percentage ANNUAL RESULTS Fondazione Cassa di Risparmio Genova e Imperia 413,162,526 18.999% The 2013 financial year took place in a deteriorating Fondazione Cassa di Risparmio di Genova e Imperia (ownership) 261,559,595 12.028% macro-economic scenario, in which the Group focused on aligning certain assets’ book value Mediobanca S.p.A. (borrower) 151,602,931 6.971% (goodwill, credit portfolio, securities portfolio, insurance business); for additional information, BPCE IOM SA 217,225,639 9.989% please refer to the Investor Relations section on the Other shareholders 1,544,276,458 71.012% website www.gruppocarige.it.

Total 2,174,664,623 100.000% These actions triggered the accounting of major one- off adjustments in the income statement as well as Figures as at 10/06/2014 a loss of EUR 1,761.7 mln. For further information about the proposal on loss coverage, please refer to the 2013 Financial Report, available on the website. The Fondazione Cassa di Risparmio di Genova e Imperia Following the extensive process of adjusting balance- is a non-profit, private and autonomous body, which sheet assets to more prudential values conducted continues those social and philantropic activities originally during the year, the Group reinforced the main risk provided, for over five centuries, by Monte di Pietà areas. The launch of a capital increase will allow the (Public Pawnbroking Institution) and later by the Cassa di Group to execute the new 2014-2018 Business Plan, Risparmio. The assets of banking foundations are devoted thus embarking on a path for gradually returning to entirely to the pursuit of their statutory objectives and are sustainable growth. managed in a manner consistent with their status as non- profit bodies operating in accordance with principles of Capital strengthening transparency and morality. In execution of the power which had been granted BPCE International et Outre-mer (BPCE IOM) is the holding to the Board by the Extraordinary Shareholders’ company of the foreign subsidiaries of BPCE Group, to Meeting on 29th April 2013, the Board of Directors, whom ten banking subsidiaries along with five banking by decisions of 27th March 2014 and 12th June 2014, affiliates and two specialised financial companies refer to. has resolved to increase capital for a maximum amount of EUR 799,288,853.40, of which EUR 399,644,426.70 to be allocated to share capital and EUR 399,644,426.70 to the share premium reserve, through the issuance of up to 7,992,888,534 ordinary

58 shares having regular dividend entitlement and left unexercised (if any) at the end of the Public On line section dedicated to investors the same characteristics as shares outstanding on Offering, pursuant to art. 2441, para. 3 of the Italian In-depth information is available at the Investor Relations the date of their issuance, with no indication of Civil Code, for a maximum amount of EUR 800 mln. section of the website www.gruppocarige.it, where users par value, to be offered pre-emptively to holders can view: of ordinary and/or savings shares, proportionally • Financial reports to the number of ordinary and/or savings shares INVESTOR RELATIONS • Ratings held, with an allotment ratio of 93 newly-issued • Information on securitisations ordinary shares for every 25 ordinary and/or Since its listing on the Stock Exchange, the Bank has • Presentations to investors and analysts always been committed to providing investors and • Banca Carige’s share price trend savings shares owned, at a subscription price of EUR • Services dedicated to shareholders 0.10 per share, of which EUR 0.05 as share premium. markets with clear information in order to enable a • Information on corporate transactions and bond issues. The final deadline for subscription of the newly- careful evaluation of the strategies and the results issued shares is set on 31st December 2014, it being achieved. specified that, should the approved capital increase not be fully underwritten by that date, capital will be The Bank established an internal structure devoted deemed to be increased by an amount equal to the to the Investor Relations activity with the aim of RATING subscriptions received. maintaining contacts with institutional investors, rating agencies and financial analysts. Besides As from 1997, Banca Carige asked for and obtained The Offer shall be supported by an underwriting the timely disclosure information on the Bank’s ratings from the main international rating agencies: syndicate comprising Mediobanca – Banca di Credito activities, the Investor Relations team periodically Moody’s, Standard & Poor’s and IBCA (now Fitch Finanziario S.p.A., which will act as Global Coordinator organizes meetings with the financial community, Ratings). and Joint Bookrunner, Citigroup Global Markets Ltd., analysts and investors to present the provisional and Short term Long Term Credit Suisse Securities (Europe) Limited, Deutsche final results and the future strategies. Bank A.G.London Branch and Unicredit Bank AG (as Fitch B BB Co-Global Coordinators and Joint Bookrunners), Banco Santander SA, Commerzbank AG London Moody’s Not-Prime Caa1 Branch and Nomura International plc (as Joint Bookrunners), as well as Banca Akros S.p.A., Banca Standard&Poor’s C B- Aletti S.p.A. and Intermonte SIM S.p.A. (as Co-Lead Managers, collectively,the “Guarantors”). Under the Data as at June 2014 Offering underwriting agreement - to be entered into at a time prior to the launch of the Offering – the Guarantors shall commit to subscribing to Banca Carige’s newly issued ordinary shares in a number corresponding to the pre-emptive rights

59 DIALOGUE WITH SHAREHOLDERS breakdown of the number and the categories of In order to facilitate the understanding of technical shares. issues, like the Bank’s economic and financial performance, a “Letter to Shareholders” is issued Over the time, the Bank has undertaken the most Moreover, using specific applications available in this once a year and published in the Governance suitable measures to reduce constraints and section of the website: section – Shareholders’ Meetings. Moreover, under requirements that may hinder the shareholders’ • shareholders can ask questions on the subjects the same section - Company Documents, the participation in the Meeting and the exercise of on the agenda even before the Meeting and Annual Report on Corporate Governance and the their voting rights, finally through the transposition these questions will be answered at the latest Company’s Ownership Structure is also published, of legislation on the rights of shareholders in listed during the meeting; made available to the public together with the companies. • those entitled to exercise voting rights have the documentation for the Shareholders’ Meeting called The relationship with shareholders is facilitated possibility to notify, through their representative, to approve the financial statements, as provided for by the opportunity of communicating directly the proxies granted (also in electronic format) to in the Italian Consolidated Law on Finance and the with the Bank through the General Secretariat attend the Meeting. Corporate Governance Code for listed companies. and a toll-free number: 800 - 335577 and +39 010/5792762 - +39 010/5794259 (4.4) Procedures regarding the appointment of Corporate Bodies, based on the voting of slates for Carige ClubAzionisti – Mail: [email protected] the election of the Board of Directors and the Board Carige Shareholders Club of Statutory Auditors, shall ensure appropriate representation of the whole shareholding structure. CARIGE clubAZIONISTI In particular, the www.gruppocarige.it website Furthermore, the Bank appoints, for each Meeting, and its specific “Governance” section, has become Per saperne di più rivolgiti a person (Designated Representative)a uno dei nostrito consulenti.whom the preferred channel for public disclosure and Ti aspettiamo in filiale. Dedicato a chi shareholders, without incurring any charge, may transparency, which the Bank uses to provide entra in azione confer a proxy with voting instructions on all or prompt and easy access to all information and some issues on the agenda. documents required for an overall description of the The Club membership is restricted to individual The Full-Year Report is the major document Bank’s governance system as well as procedures customers holding at least 20,000 Banca Carige’s in the relationships between the bank and the for participation and voting rights in Shareholders’ shares. Through this initiative, the Bank offers to shareholder, along with the additional periodic meetings, as and related agendas. its shareholders more favourable conditions on financial disclosures that Carige – being a listed This section includes: current accounts, personal loans, mortgages and company – publishes under art. 154-ter of the Italian • all the documents to be submitted to the loans, securities custody services, safe deposit Consolidated Law on Finance. Meeting; boxes, insurance policies issued by the Group. These documents are available, in English as well, • the forms which Shareholders are entitled to Carige Shareholders Club also offers extra non- on the Group’s website (www.gruppocarige.it, use for proxy voting; banking benefits such as information and assistance Investor Relations section – Financial Statements). • information on the share capital, including the services.

Messaggio pubblicitario con finalità promozionale.

Per le restanti informazioni contrattuali si rinvia al foglio 60 informativo disponibile in tutte le filiali. 0 1 / 2 3 - A Z 0 1 - E s t e r n a

www.gruppocarige.it C o m u n i c a z e Un porto sicuro nella vostra città. SOCIAL REPORTING – EMPLOYEES

• Policies and reference values POLICIES AND REFERENCE shared value system; • Staff composition • protection of individuals, their safety, mental • Turnover VALUES and physichal health; • Training and enhancement • motivation of all individual employees involved • Equal opportunities and work-life balance In a complex era as the one we live in and in a in the company’s management, up-skilling • The remuneration system constantly evolving market, a necessary condition them through ongoing training and refresher • Supplementary welfare system to remain competitive is the capacity to recognise programs; • Health and safety and enhance the potential of employees through • recognition of equal opportunities for all • Industrial relations growth paths which include specific development members of staff. • Internal communication and retraining programmes. Carige believes that this creates the conditions Key figures for its employees to work in the safest and most STAFF COMPOSITION (LA1-LA13) efficient way, channelling their energy and personal 5,385 employees skills towards the achievement of the Company’s As at 31/12/2013, the Group’s staff is composed of 99% with an open-ended employment contract objectives. The Bank’s main priorities include the 5,851 employees, of which 5,385 are part of the 54% based in Liguria creation and the strenghtening of the corporate banking group. identity as well as the sense of belonging of the 48% of the workforce consists of women, and 54% 52% men and 48% women employees, through communication activities is based in Liguria. 104 hired in the last two years, of which favouring their involvement and engagement. 71% of the employees operates on the market, while 53 women and 51 men 29% works at the head office. 1.8% turnover rate In line with the Code of Ethics The average age of the employees is about 47 years, and the average length of service is 16 years. 291,133 total hours of provided training Well aware that the enhancement of human 54 average training hours per employee resources is indispensable for the very existence, development and success of its business, the Carige BS OHSAS 18001:2007 Health and Safety Group always acts on the basis of the following Management System extended to 100% of the principles: Group. • development of each employee’s personal, cultural and professional peculiarities, within a

61 The following figures, charts and tables refer to the banking Group

Age Geographical distribution of employees Geographical distribution of employees

< 30 years 2,930 30 - 50 Over 50 2,455

55% 52.2% Women 49.7% 4,118 46.3% Men 43.5% 1,473 Total 1,457 Women 1,334 40.3% Men 2,120 1,121 1,998 Total

910 465 445 347 111 236 4 6 10

North Centre South and islands Abroad

Liguria Rest of Italy and abroad 4.7% 4.0% 4.3%

Women Men Total

Average length of service Professional categories Education

Executives Women 1.4% Other 7.6% Man Total Managers 2,131 26.3% 32.3% Degree Professional areas 1,148 1,144 1,085 983 1,025 72.3%

666 562 523 555 478 470 Secondary schools 60.1%

0 - 10 years 11 - 20 years 21 - 30 years over 30 years

62 Recruitments and terminations by age Recruitments and terminations by title TURNOVER (LA2-EC7)

Recruitments Recruitments In selecting its employees, the Banca Carige Group Terminations Terminations shall adhere to the principles of fairness and good faith, implementing meritocratic criteria, 67 88 in accordance with the provisions of law and the collective labour agreement in force. 49 The recruitment is conducted through a selection process. Interviews are strictly focused on assessing whether the peculiarities of each candidate are in 28 34 line with the required professional profiles, taking into account equal opportunities, preventing any 16 form of discrimination. 10 1 2 4 The recruitment procedures are based on principles 1 2 < 30 years old From 30 to 50 Over 50 aimed at maximising the efficiency of the process. Executives Managers Professional Areas Depending on the required profiles, a first selection is conducted by either specialist companies or the Bank’s specialist departments and, afterwards, the final interview is carried out by company members. Recruitments and terminations by gender Recruitments and terminations by geographical areas Despite the challenging economic situation, the Recruitments 54 68 Group continued to hire people in 2013 too. During Terminations 88 the year, 52 new employees were recruited, against 45 99 terminations, mainly due to eligible retirements. Moreover, Banca Carige hosts students and graduates Recruitments experiencing training courses and apprenticeships 31 Terminations 38 within the various Bank’s structures. In 2013, 83 21 24 trainees from different Italian universities were 34 hosted, mainly attending Economics or Law at the 13 16 7 University of Genoa. No action has been undertaken 10 1 in relation with possible corruption (SO4). 1 2 Women Men North Centre South, islands and abroad

63 TRAINING AND SKILLS efficient way, channelling their energy and personal skills towards the achievement of the Company’s MANAGEMENT (LA10-LA11) objectives. The training offer is constantly updated, also consulting the Bank’s structures which are In 2013, 291,133 hours were dedicated to training responsible for the core activities. Delivery of training programs, with an average of 54 hours per employee. is prepared in collaboration with consultants and major universities, such as SDA Bocconi, European In 2013, a training session entitled “L’Etica nella House Ambrosetti, Scuola di Palo Alto (business and Consulenza Finanziaria alla Clientela” (Ethics management school), University of Genoa, McKinsey, in Financial Advice to Customers) involved ABI Formazione. 29 employees, among high-end financial The 2014 training programs favour technical and advisers (Affluent, Private and Coordinators of professional contents, by assessing skills and learning, both), Branch Managers, Unit Managers in the in order to better evaluate both the adequacy of the headquarters and others. At the moment, the topics proposed and the methodologies applied. Bank is planning further editions of this course. Special projects concern young talents (Gymnasium Planning activities and the provision of training Carige, Gestione Bancaria, Banking & Financial services obtained the UNI EN ISO 9001:2008 Diploma) and the “schools” (commercial, finance, certification for the EA37 sector. The respect of strict credit granting, managerial). These modular training procedures and processes grants a transparent and projects have a duration of about one year and they efficient training approach, aimed at developing alternate, wherever possible, classroom hours and human resources in line with the company’s on-the-job training. requirements of qualified personnel.

Carige constantly invests in its employees’ training programs, with the primary aim of creating, strengthening and/or further specialising their technical-professional knowledge and know- how through growth paths which involve both the Company and the employee, with the two-fold objective of improving performance and limiting any professional risks inherent in every business activity. Carige believes that this creates the conditions for its employees to work in the safest and most

64 Project Description Attended in 2013 by In 2014, Banca Carige launched the Financial, Commercial and Advanced Credit-granting schools, Training project for young, high-potential employees with the purpose of developing more structured with qualified culture and education. The aim is skills in the aforementioned sectors, alternating Gymnasium Carige to develop managerial skills, providing an overall 20 employees theoretical and practical classes, as satisfactorily picture of the corporate processes and gaining some implemented by the Credit-granting School in 2013. fundamental banking management competences. The Banca Carige Group has extended the compliance responsibility to all employees with The course is targeted to employees assigned to regard to their specific tasks. For this reason, the central headquarters and provides basic knowledge Bank is committed to spreading the internal culture Banking management on the financial system operation, the banking 23 employees on compliance, in order to strenghten an ethical and management and the evolving and competitive responsible behaviour of the whole staff. To this end, trends of the banking sector. It is focused on technical the Bank has organised specific training sessions and specialized skills rather than on business issues. on the laws and regulations currently in force in Italy, such as the Anti-Money Laundering Directive, Project for recently hired employees, deemed worthy Banking & Financial the Mifid Directive, and the Administrative Liability on the basis of their constant commitment and pursuant to Italian Legislative Decree 231/2001. Diploma contribution. Since its 15th edition, the participation 11 employees to this project has been reserved exclusively to the network staff. Training (hours) Training path dedicated to newly recruited corporate consultants, and made up by several class- and on- Training on the-job training phases, to be followed in modular the job 3.8% sequences, which combine the theoretical and Credit Granting School practical aspects of the context in which banks 22 employees and businesses deal on a daily basis. The purpose Remote 33.6% is to facilitate behaviours always more oriented training to excellence in performance, in a context of cooperation, integration and transparency. Training in class 62.6%

65 The Banca Carige Group gained access to financing for trading provided by bilateral Inter-professional Funds. Training by thematic areas The Group presents training plans following the notices issued by these Funds concerning the financing of professional training. The Funds evaluate the quality of the submitted plan and its consistency with the Commercial Other company’s goals. 2.0%1.2% The execution of the financed plan is then strictly monitored by the Fund, through the verification of accounting. In the last years, Banca Carige obtained the maximum contributions on the basis of the Bank size and the Operational/ 14.0% IT/ Language number of its employees. Insurance 35.4% Credit 15.8%

The regular performance and career development review (LA12) is a tool for personnel management Conduct/ 7.8% Managerial and enhancement aimed at improving the human resources management, contributing to both their 7.2% 16.7% development and growth. Regulations Finance and Mifid This system applies to all staff and enables to identify the needs of professional growth and development, integrating information and supporting policies for human resources development, also in relation to staff recruitment, training, job rotation and bonuses. Regulatory training The review process is based on a classification of necessary skills and behaviours in order to perform the Administrative Liability different company roles, both in the headquarters and in the branch network. In this review process, they (Legislative Decree 231) Transparency and usury have been combined in order to achieve organisational purposes and patterns of behaviour and knowledge, 0.3% 0.8% reflecting the theoretical path of professional growth, role and experience gained. Other 22.0% This review system allows to gather useful suggestions to precisely define specific competence profiles, 26.2% Patti Chiari ensuring consistency with the business development and the creation of both vertical development and horizontal mobility paths.

Anti-Money 29.3% Laundering 20.3% Safety

1.1% Privacy

66 EQUAL OPPORTUNITIES Moreover, the composition of the Board of Directors and the Board of Statutory Auditors is fully compliant with the provisions of the Italian Consolidated Law Banca Carige participated in the 11th edition of the The Bank is committed to ensuring equal on Finance in terms of equal gender representation Social Awards Sodalitas with the project ”Donne opportunities to all employees and to avoiding any in the administrative and control bodies within the Carige” (Carige Women). The project has been discrimination based on race, nationality, gender, listed companies. included in the “Libro d’oro della Responsabilità age, health, religious and political beliefs and Sociale d’Impresa” (Golden Book of Corporate different abilities, in line with the Code of Ethics. Social Responsibility). Gender Balance “Insieme e diversi – come dare valore alla pluralità” (Together and different – how to At the end of the financial year, the female value diversity) is the title of the first edition of employment rate was 48% of the total workforce, the project on equal opportunities organised in against a 44% registered in 2012 within the Italian January 2013 by the Carige’s Training Centre. banking system. The percentage of women in top “Pari opportunità: la valorizzazione delle positions is equal to 13% (among executives and competenze di genere” (Equal opportunities: the Deputy General Manager for Governance and promoting gender balance) is the title of the Control). second edition of the project, organised in October 2013 by the Carige’s Training Centre. It At the end of 2013, 96% of the 395 part-time consisted of two days of class training focused employees were female. on gender diversity and its value. The Group’s remuneration and incentive policies do In December, Banca Carige took part in the not provide for any different salaries in relation to “Tavolo Principale delle Pari Opportunità” gender, as they are based on principles of fairness (Main working table on Equal Opportunities) held and meritocracy. (LA14) in Rovigo, where the book “Violenza Domestica in Polesine. Quali possibilità di intervento: No events related to discriminatory practices on the uno studio esplorativo” (Domestic Violence in grounds of age or gender were recorded. (HR4) Polesine. Possible interventions: an exploratory study) was presented. This publication was edited by the non-profit association “Co.Me.te” and the Commission and Department for Equal Opportunities of the Province of Rovigo, with the financial support of Banca Carige Italia.

67 THE REMUNERATION SYSTEM The remuneration structure is based on both the The structuring of the incentive schemes, as per existing supervisory provisions (Bank of Italy and BSC model, fosters the development of a like-to-like The Bank is committed to applying principles CONSOB) in terms of remuneration and incentive corporate culture, aimed at achieving also quality of ethics and transparency to the retribution policies and practices, and the national and corporate targets, in the medium and long term. of both the top management and employees, collective labour agreements. including market operators and traders, in Within the Group incentive systems, other accordance with the regulations applicable The Group’s remuneration system for employees objectives have been introduced for the Sales from time to time and the provisions envisaged consists of the following components: Network and Private Bankers, with the purpose of by the Supervisory Authority. To this end, the facilitating the growth of a “compliance culture” Bank undertakes to adopt retribution policies • Fixed component of remuneration, determined by adopting a behaviour constantly in line with that may ensure a balanced salary structure by relevant labour agreements, including an internal and external regulations. These indicators in its various components, clearly determined, allowance for those employees assigned to currently concern investment services, anti-money consistent with a prudent management of corporate control functions; laundering and complaint handling. the Bank and the Group, taking into account • Variable component of remuneration, based their goals (even in the long term) as well as on incentive schemes for all employees, Company bonuses and other personal and family the current economic scenario. Furthermore, differentiated according to their activity and benefits are granted by means of corporate adequate retribution and incentive mechanisms providing for bonuses in the manners from time unilateral resolutions (such as accident insurance, allow the Bank to attract and retain those to time set forth by the company and in line with professional and non-professional indemnity subjects with high skills and professionalism. the existing regulations. insurance), individual agreements (company car) or complementary company agreements (medical The Ordinary Shareholders’ Meeting on 30th The Bonus is granted to employees subject to a full care, supplementary pension schemes). April 2014 approved the remuneration policies compliance with the access conditions associated currently in force, in accordance with risk with profitability, liquidity and financial stability For certain professional roles, multi-annual bonuses mitigation policies and the Bank’s long-term indicators, which take into consideration all the risks are envisaged upon non-competition and minimum objectives as well as its corporate culture, the over a long-term horizon. duration clauses, to be granted in relation to their overall corporate governance and the internal strategic role for the company. control system. The incentive schemes are based on the degree of achievement of the objectives set forth in a Balanced For further details, please refer to “Banca Carige Under the banking collective labour agreement, Score Card (BSC) system, concerning economic Group’s retribution policies” on the website there are no differences between the standard and financial profiles, internal-external customer www.gruppocarige.it – section Governance – wage of the newly hired employees and the local satisfaction, efficiency and productivity of the Meetings. (4.5) minimum wage of the most significant operating processes, along with human resources managing locations. (LA14-EC5) and development.

68 SUPPLEMENTARY WELFARE Social Activities SYSTEM The employees of the Parent Company and its The Social and Recreational Club for Employees subsidiaries Cassa di Risparmio di Savona SpA “Circolo dei Dipendenti della Banca Carige S.p.a.”, Both full-time and part-time employees, regardless and Cassa di Risparmio di Carrara SpA, in force based in Genoa, was established in 1955 as “Circolo of the duration of their contract, benefit from until the dates respectively of 30th November Dipendenti Banca Carige S.p.A. – Cassa di Risparmio supplementary forms of pension and health 1991, 12th July 1988 and 1st July 2008, are members di Genova e Imperia – Associazione Sportiva care, considered a significant component of the of pension funds, established as part of the Dilettantistica” (Employees’ Recreational Club - remuneration structure. (LA3) The following capital of each respective Bank, without legal Cassa di Risparmio di Genova e Imperia – Amateur benefits are provided: personality, operating under defined benefit Sports Association) as a free association of Banca schemes (the so-called FIP – Fondo Integrativo Carige and the other companies’ employees. The • Supplementary health care (LA8) Pensionistico – Supplementary Pension Fund), Club’s mission is to promote, in all fields, mutual • Insurance against the risk of death, injury, or which ensure a supplementary pension scheme understanding, respect and friendship between its permanent disability and have a significant insurance component, associates, by developing artistic, cultural, tourist, • Supplementary pension schemes (refer to the enforceable in case of permanent disability or entertainment and sports initiatives to encourage box) death during service. social growth through a healthy and fruitful use of • Banking facilities on charges and commissions, free time and to stimulate the spirit of aggregation The remaining employees of these banks, as mortgages and loans on favourable terms among associates, the sense of belonging and team well as those employed at the other Group’s • Access to the company canteens spirit, being principles that go beyond the work- subsidiaries, have the opportunity to join the • Meal vouchers related scope. Fondo Pensione Aperto Carige (Banca Carige Institutional activities of particular importance are: Open-ended Pension Fund), a supplementary Moreover, the Group’s employees can benefit from • Organisation of members meetings, conferences, pension scheme operating under defined paid time off for medical check-ups and family discussions, shows, exhibitions, etc. contribution schemes identified by the care in case of hospital admissions and surgical • Establishment and management of the social relevant trade union agreements. In this case, interventions. library; beneficiaries receive a considerable contribution • Supply of materials and equipments for the by the Bank and a part of it, at the choice of the various cultural and recreational activities; interested party, may be devoted to cover risks • Promotion of physical exercise and amateur of permanent disability or death, even if not sports activities; arising from accidents. (EC3) • Development of initiatives aimed at understanding the members’ aspirations, ensuring an adequate satisfaction to the demands.

69 The Club is also in charge of entering into agreements In the last two years, the Banca Carige Group The Banca Carige Group has adopted state-of-the- with companies, entities and/or associations in implemented a management system for health art techniques of prevention and deterrence of order to secure for its members the entitlement to and safety in the workplace in line with BS criminal acts, which are constantly updated. discounts and special conditions for the purchase of OHSAS 18001:07 standard which obtained a RINA goods and services. certification (an accredited and internationally Furthermore, the Group’s Banks cooperate actively recognised body), being therefore subject to in- with police forces and competent public bodies, also depth internal and external audits on a yearly basis. joining specific “Memorandum of Understanding” related to crime prevention, subscribed by the Italian By adopting this management system, the Carige Banking Association (ABI) with several Prefectures. Group intends to: Health and safety • Improve health and safety levels in the workplace; Pursuant to Article 35 of Legislative Decree 81/2008, • Increase its efficiency; all the Group’s Banks organise annual meetings with HEALTH AND SAFETY AT WORK • Minimize the risks to which employees or third the corporate representatives (Employer and his (LA8-LA9) parties (customers, suppliers, visitors) may be Delegates), the Prevention and Protection Service exposed. Manager, the Medical Officer and the Workers’ The Banca Carige Group has drafted and approved Safety Representatives in charge. a specific document on “safety policy” where the Bank is committed to improving employees’ health Other meetings take place between the Prevention and Protection Service and each relevant player, and safety in the workplace, as an integral part of The Carige’s health and safety policy is disclosed its activity, and to implementing the necessary in order to analyse and examine specific issues to all staff, suppliers and customers, and it is made such as the development of the risk assessment resources for such purposes. Health and safety of available to the public and whoever may request it. employees are essential and valuable aspects of the process and the progress of the mitigation plans, the corporate processes to successfully manage any necessary legislation updates against the evolving work activity. regulatory framework and the management Dedicated training sessions cover health and safety issues. The Security Officer periodically meets with In this respect, despite the absence of a dedicated issues in order to develop the level of awareness the Supervisory Body and the Board of Statutory regulatory framework, the Group has adopted and knowledge of risks and the preventive actions Auditors. (LA6) a management system for health and safety in to put in place. In 2013, 9,885 hours of training were the workplace which combines health and safety provided to 1,619 employees (pursuant to Legislative policies and objectives in defining and managing Decree 81/2008 on Health and Safety). work processes and systems.

70 INDUSTRIAL RELATIONS participation of 79% of the personnel. Legal cases Disputes stemming from employment relationship All the Group’s employees are covered by collective are rather limited. In this regard, at the end of 2013, agreements. Therefore, the safeguards provided in Minimum notice period(s) for significant operational only 16 individual cases were pending, together the collective agreement are automatically applied changes (LA5) with two lawsuits filed by ex-employees about to all employees since their recruitment. (LA4) 85% the application of the company’s pension fund of the total workforce joined one of the eight Trade Major reorganisations and/or restructuring “terminated” on 30th November 1991, set up within Unions represented within the Group. operations are carried out in compliance with the Collective National Labour Agreement, which the Parent Bank’s assets. In the existing regulatory framework, labour establishes that corporate Trade Unions shall be relations at corporate level are mainly regulated noticed in advance and in writing of the reasons INTERNAL COMMUNICATION by the National Collective Labour Agreement and for the planned reorganisation/restructuring, as Internal communication is a strategic aspect of by provisions of the law, which establish specific well as the economic, legal, social consequences for opportunities of discussing with trade unions. the organisational model, which allows a clear workers and the possible measures in their regard. and transparent dissemination of information, Also in 2013, relations with trade unions were In particular, changes in working conditions are a constructive dialogue with the staff and the characterized by a constructive climate, reflected in specifically negotiated before becoming operational. strenghtening of a stable relationship based on an open and dialectic dialogue on various issues, in mutual trust. respect of the different roles and opinions and in full This procedure has a maximum duration of 45 awareness of the fact that only the contribution of days (starting from the aforementioned written The Internal Communication activity makes use of a each subject can ensure viable solutions to respond notification), or 50 days whether the restructuring/ wide range of tools, briefly detailed below. to a constantly evolving reality. reorganisation should involve two or more Group’s companies. In 2013, 25 meetings were held, for 120 hours in total. In particular, during the year, the discussions with trade unions were focused on the disposal of Carige Asset Management SGR to Arca SGR S.p.A. and the related implications concerning Supplementary Pension Schemes for the Group employees. In 2013, no strike was organised as a result of company disputes. During the year, besides strike actions at national level, arising from political and economic issues, a general strike was organised by the whole banking system, which saw the

71 Carige’s Value “Distillare, vivere, comunicare i valori di Carige” (Instil, live and share Carige’s values) is a project launched at the end of 2008 and then extended in 2009 to include, by cascade, all staff. In its first phase, the project involved The company intranet, launched in June more than 200 colleagues among Directors, Executives and Managers who 2010, is the main communication channel deeply contributed to a prior instillation that, starting from autumn 2009, with employees and the access point to major delved into the programme through a series of meetings aimed at bringing procedures, supporting the working activity: the out the Group’s values, involving all of its employees. average monthly accesses to the various intranet sections total 19 million clicks. Within the intranet, there is a specific section By means of a cascade process, in September 2009, the Area Managers dedicated to the company values, which were and the Responsibles of central offices discussed about three Banca Carige Values’ trees, ‘Da sempre’ (always), ‘Insieme’ (together), and ‘In movimento’ defined in a two-year project that involved all The aim of this project was to share Group’s employees. (on the move), firstly addressing several questions, thinking about slogans and recurring words which characterise their job, and identifying priority and write the values of Carige, not to In 2013, this section recorded a monthly average actions for Banca Carige. In turn, these colleagues (Trainers) exchanged make a fine show, but to reflect them of 520 accesses for a total of 6,250 accesses views with branch managers or headquarters colleagues about similar always in our way of life and different thoughout the year. subjects and, then, the latters involved in this project the branch and office workstyle, to win the market challenge personnel. today as in the past.

Web TV The corporate web TV, launched in April 2009, consists of three thematic channels, devoted to training, news and market. The monthly programming features 5 videos on average and in 2013 counted 43,000 views.

Quindici (Fifteen) The monthly newsletter for the sales network was launched in 2009 for branch personnel with a commercial focus. It is available both on paper and electronic version, with a monthly average of 1,400 accesses.

72 CarigeNotizie Online library In 2013, employees had the possibility to express their view on the internal communication tools and The company’s in-house quarterly newsletter, their expectations for the future. 500 colleagues launched in 1993, talks to employees about staff, participated in this survey and the results were useful events, business strategies, casting an eye over the to find areas of improvement for the following year. outside world. It is available in electronic format on the corporate intranet (4,000 accesses for each The active participation of the staff is encouraged newsletter on average) and in paper, which is sent to thanks to the initiative “Invia il tuo Suggerimento” pensioners. Carige Notizie can also be read at home (Send your Suggestion) and 141 contributions were thanks to a closed Google group for the employees. Created in August 2012, it contains professional submitted in 2013. texts, ranging from market analysis to communication, from economy to self- improvement, from marketing and strategies to legislation and safety. In 2013 more than 150 new books became available (1,500 accesses per month on average).

New initiatives launched by Internal Communication unit in 2013 concerned:

• the preparation of the Communication Kit: a set of presentations to ease and enhance the relationships with new customers, along with manuals on professional writing; • the launch of the NIC Forum, where six thematic discussions have already started, recording an average of 3,000 accesses per month. Since last autumn, the employees have been enabled to highlight subjects of common interest; • the introduction of the “GoodNews” section: a new initiative underlining positive innovations about the Carige Group.

73 SOCIAL REPORTING– SUPPLIERS

• Responsible selection of suppliers the fact that a large part of the Group’s activity, and safety. For every supply, usually three potential • Management and qualification of suppliers market share and employees is to be found in providers are evaluated, in relation with price and • Classification of suppliers and their territorial Liguria and the Group’s headquarters are historically according to their technical skills. distribution based in Genoa, the pursuit of efficiency and best- The Parent Company’s Purchasing Department, suited solutions has driven the Group towards the when stipulating supply agreements, requires from 2013 Key figures development of supply relationships on a national all of its suppliers the full respect of the existing laws basis, i.e. in the areas where branches are located. and regulations on Labour, with a special focus on 5,889 suppliers, 32% of them are based in Liguria child labour; the protection of health, safety and In line with the Code of Ethics EUR 251.1 mln total volume of business with hygiene at work; the respect of the Consolidation suppliers When placing orders to suppliers, the Banca Carige Act on immigration and the status of foreigners Group prefers the companies that are committed (Legislative Decree 286/1998), as well as assistance, to complying with the existing laws and regulations insurance and accident prevention duties set forth in RESPONSIBILE SELECTION OF on environmental safety and protection, as well as the current legislation (particularly the Consolidated Law 81/2008). SUPPLIERS safety in the workplace and right to privacy. In line with the pursuing of speedy and lightweight In line with the principles of the Code of Ethics, MANAGEMENT AND solutions, the Group outsources activities such as business relationships between the Group and mail delivery and collection, processing of cheques, its suppliers are characterized by respect, trust, QUALIFICATION OF SUPPLIERS printing services, portfolio management, counting correctness and integrity, in the absolute conviction of valuables. that the pursuit of the Company’s mission is, amongst Managing the relationships with suppliers is primarily Moreover, the Group has relationships with leading other things, conditional upon the quality of services assigned to the Parent Company’s Purchasing national and international advisory companies for and products supplied. Therefore the procurement Department, an organisational unit responsible for organisational and commercial consultations, in policy is based on a systematic attention to both a substantial part of the Group’s purchases. This order to improve its internal and external efficiency, quality-price ratio and service level. unit, which manages more than half of all supplies relying on the best technical and professional skills The Banca Carige Group is also aware of the fact that at Group level, is composed of buyers with different available on the market. the purchase of goods and services necessary for its skills depending on the type of purchase. business supports aggregate demand and creates The suppliers are identified considering the price- wealth in the local economies it operates in. Despite quality ratio, professional requirements, fairness

74 CLASSIFICATION OF SUPPLIERS Geographical location of suppliers and purchases Suppliers and purchases per amount no. of Suppliers AND GEOGRAPHICAL 94.9% Turnover

no. of Suppliers 81.6% DISTRIBUTION Turnover 68.2% In 2013 the number of suppliers was 5,889 for a volume of business totalling Eur 251.1 million. 32% 50.9% of suppliers are located in Liguria.

19.9% 14.2% 10.8% 19.2% 17.9% 2.5% 1.2% 1.7% 12.0%

North Centre South and Islands Abroad 3.6% 0.7% 0.8%

Purchases by type of goods/services Up to 100,000 From 100,001 to500,000 From 500,001 to 1,000,000 Over 1,000,000

Movable and 17.0% immovable assets management Other 25.8%

Transport 2.8% 20.4% IT

Telephone, postal, 14.4% electricity, cleaning 3.2% 16.5% Legal and professional Advertising and similar

75 ENVIRONMENT

• Policies and reference values • Use of resources • Emissions • Sustainable mobility • Waste management • Use of resources • Awareness-raising activities o Paper o Electricity Fuels and Raw Materials POLICIES AND REFERENCE Environmental impacts o o Water VALUES • Emissions into the atmosphere • Water discharges Although the typical operating activities of a banking • Waste production institution do not produce any direct environmental • Reduction of paper use (paperless bank) impact, the Banca Carige Group is committed • Energy Efficiency (quantity and quality of energy) to implementing a careful policy of energy cost Mitigating actions • Recycling containment and waste management as well as • Awareness-raising activities for the employees creating a corporate culture aimed at encouraging “virtuous behaviours”, for the purpose of a constant strengthening of relationships with all of its stakeholders. This focus is reflected in the identification, monitoring and mitigation of the main direct and indirect business-related impacts on the environment. In this respect, the Group is implementing both monitoring tools and reporting. In these fields, the Group has gradually been adopting tools for impact monitoring, which will enable to report on them even more closely in the next edition of the Corporate Social Responsibility Report.

76 USE OF RESOURCES Architectural and structural system (insulation, doors and windows, etc.). Paper consumption and office equipment A lighting reduction plan for the non-working areas of the headquarters has been scheduled for The Banca Carige Group decided to decrease the 2014. It should enable to reduce costs maintaining use of paper documents and convert them into a sufficient level of brightness in order to ensure electronic files, in order to reduce costs and impacts maximum safety for users of common areas. on the environment. In 2013, the Group has launched The largest consumptions concern electricity used a project aimed at reducing paper printouts. As a for equipments and air-conditioning systems. result, the number of printed pages each month The information provided by the major electricity was reduced from over 700,000 at the end of 2012 suppliers shows that the same comes from to a little more than 300,000 at end 2013. To be renewable resources. More specifically, 70% of the noted that, in 2010, the average print production per total energy demand is supplied by GSE and it is month was about 1.3 million units. 100% renewable. Energy and natural resources consumption Heat energy consumption mostly derives from natural heating gas. The complete traceability of In order to monitor and reduce energy consumption, the origins of electricity is however difficult, since the Group has appointed an ‘Energy Manager’. the branches are mostly located in buildings, whose He undertakes actions aimed at reducing electric condo councils decide autonomously their supply power and fuel consumptions, such as the constant policies. monitoring of electricity consumption and heating, and in case of new operating units or renovation (restructuring and modernization), he ensures technical choices to guarantee an optimal use of energy. In this regard, the areas of intervention could be classified as: Electrical and lighting system (the use of low consumption bulbs, presence detector and twilight switch);

Engineering and mechanical system (high- efficiency heating system, heat pumps, condensing boiler, etc);

77 Water Consumption service requirements: in addition to traditional are collected and sent to the relevant body, in order e-learning activities (almost 100,000 hours in 2013) to obtain a discount proportional to the quantity Water is mainly used for hygienic-sanitary purposes, a remote meeting management system has been of the recycled material. Paper material collected and to a lesser degree for the air-conditioning implemented (live meetings): about 400 monthly during 2013 (in Genoa) were about 156,000 kg, cooling system. meetings involving 6 people on average. therefore a great discount will be granted to the Water is supplied through the public pipelines. Bank (for the same quantity, it amounted to EUR In this regard, also the contacts with external 40/45,000 in past years). subjects, partners, advisors, suppliers and EMISSIONS associations are managed focusing on optimizing The definition of “Special Waste” includes : timing and relocations, supporting the organisation With reference to the renewable energy, it is of video and conference call in specifically equipped • paper and cardboard possible to estimate a decrease of 15,230 tons in Co 2 meeting rooms. • toner emissions (5,641 TEP) for the whole 2013. • tapes and printer cartridges The Company is currently developing a new web- • CD, video cassettes and plastic waste. As for ozone-depleting substances, through a conference system among internal and external techno-economic assessment, the Group has users, from the workplace but also by means of the The Bank is responsible for the collection and been decreasing the use of equipment containing latest generation smartphones. disposal of this kind of waste as required by the Law; HCFC (e.g. refrigerant gas R-22), in line with the whose respect is ensured by a proper application of European Regulation 2037/2000. More specifically, Waste management internal regulations. appropriate solutions for every single system have been adopted, and, when necessary, the structures The headquarters’ waste is sorted, recycled and • Other types of waste have been substituted, carrying out retro-fit recovered, while the solid urban waste is managed by • Lead-acid batteries and batteries operations using authorized HFC gas, authorized by public collection services. Over the years, the Group • Out of service equipment the Law. relied on a supplier for the collection of paper waste • Fluorescent shoses in all its branches. For the headquarters, the choice • Waste material from construction The Group’s car fleet consists of 150 cars, 45 of for the head office supplier is normally different, and which belonging to the Group and 105 long-term most of the waste is accompanied by certificates to These kinds of waste are collected and disposed rental cars. Greenhouse gas emissions for vehicle deliver to the municipal offices responsible to check directly by suppliers in accordance with current categories (EURO 4 and EURO 5) range from 90 to the quantity of recycled material. regulations and terms of the agreement they signed. 200 g/km, depending on the car’s cylinder capacity per kilometer-ratio. Throughout 2013, certified packages amounted to 27,000 (excluding the Municipality of Genoa). Sustainable mobility Considering that every package weighted about 10 kg, the overall weight was about 270,000 kg. For some years, Banca Carige has been supporting a detailed staff-mobility policy connected to With regard to the city of Genoa, these certificates

78 AWARENESS-RAISING The effort resulted in the following cost savings: INITIATIVES • Electricity: - 1 million kW, accounting for 3% of branches’ total consumption For three years now, the Banca Carige Group has • Paper: EUR 20,000 € been promoting a number of awareness-raising • Landlines: EUR 700,000 initiatives on energy saving for its employees , with • Stationery: - EUR 213,000 the two-fold aim of fostering an ethical culture of • Petty expenses: EUR 35,000 environmental protection, reduced consumption and cost containment. The Group’s engagement The first branch in terms of consumption reduction in this area translates into multiple supporting was Sambuca di Sicilia. initiatives and media content production available on the company intranet In 2013, the following initiatives were developed:

• Carige took part in the 9th edition of the energy- saving day “Mi illumino di meno” (“I will use less light”), organised by Caterpillar, a programme on RAI Radio 2. The initiative was aimed at reducing power consumption through little, albeit significant, behavioral changes. • “Chi più risparmia vince!” (Save more, win more) is an initiative aimed at raising awareness on how some easy-to-apply “virtuous behaviours” by employees when using the Company’s resources could translate into cost savings. The branches of the Group were monitored for 6 months (from 1st June to 31st December 2013) on cost indicators including electricity, landlines, copy paper, stationery, petty expenses).

The Manager responsible for preparing the company’s financial reports of Banca CARIGE S.p.A., Mr. Luca Caviglia, declares, pursuant to paragraph 2 of Article 154 bis of the Consolidated Law on Finance, that the consolidated accounting information contained in the Banca Carige Group’s Corporate Social Responsibility Report for 2013 corresponds to the document results, books and accounting records. 79 DATA AND INDICATORS FINANCIAL HIGHLIGHTS

RECLASSIFIED BALANCE SHEET RECLASSIFIED INCOME STATEMENT

2013 2012 (1) Change Change 2013 2012 (1) ASSETS absolute % absolute % Cash and cash equivalents 339,280 376,709 - 37,429 - 11.0 Net interest income 636,074 755,964 - 119,890 - 15.9 Financial assets 10,935,917 10,198,864 737,053 7.2 Net fee and commission income 272,028 303,190 - 31,162 - 10.3 Loans to banks 1,218,989 2,165,106 - 946,117 - 43.7 Net interest and other banking income 1,019,165 1.230,973 - 211,808 - 17.2 Net adjustments: - 1,107,361 - 603,284 - 504,077 83.6 Loans to customers 25,476,359 30,142,748 - 4,666,389 - 15.5 - of which impairment on loans - 1,063,420 - 447,435 - 615,985 … Fixed assets(2) 1,631,540 3,580,958 - 1,949,418 - 54.4 Net income from banking activities - 88,196 627,689 - 715,885 … Other assets (3) 2,554,190 1,976,735 577,455 29.2 Net income from financial and insurance activities - 228,263 445,866 - 674,129 … Total assets 42,156,275 48,441,120 - 6,284,845 - 13.0 Administrative expenses - 678,268 - 667,284 - 10,984 1.6 Liabilities a) Personnel expenses - 400,146 - 402,938 2,792 - 0.7 Deposits from banks 8,161,242 8,486,727 - 325,485 - 3.8 b) other administrative expenses - 278,122 - 264,346 - 13,776 5.2 Deposits from customers 14,817,367 16,729,803 - 1,912,436 - 11.4 Operating expenses - 792,057 - 674,026 - 118,031 17.5 Securities issued 9,217,979 11,022,540 - 1,804,561 - 16.4 Gains (losses) on investments in associates and joint ventures 98,475 3,182 95,293 … Other financial liabilities(4) 1,769,381 2,843,224 - 1,073,843 - 37.8

Specific allowances 464,647 454,960 9,687 2.1 Impairment on goodwill - 1,673,006 - - 1,673,006 … Technical reserves 5,017,768 4,717,735 300,033 6.4 Gains (losses) from disposal of investments - 279 50 - 329 … Other liabilities 1,064,672 1,348,448 - 283,776 - 21.0 Profit (loss) before tax - 2,595,130 - 224,928 - 2,370,202 … Shareholders’ equity 3,349,038 2,762,654 586,384 21.2 Taxes on income from continuing operations 818,422 249,440 568,982 … Non-controlling interests (+/-) 55,838 51,600 4,238 8.2 Net profit (loss) for the year - 1,776,708 24,512 - 1,801,220 … Net profit (loss) (+/-) (1,761,657) 23,429 - 1,785,086 … Profit (loss) for the year attributable to non controlling interests - 15,051 1,083 - 16,134 … Total liabilities 42,156,275 48,441,120 - 6,284,845 - 13.0

Amounts in thousands of € Parent company’s net profit (loss) for the year - 1,761,657 23,429 - 1,785,086 …

(1) Some figures were recalculated after the publication in order to retrospective apply IAS 8. Amounts in thousands of € (2) Including hedging derivatives (item 80). (1) Some figures were recalculated after they were published following the retrospective application of IAS 8. (3) Consisting of: tax assets (item 140), non-current assets and asset groups held for salde and discontinued operations(item 150) and other assets (item 160). (4) ) Including hedging derivatives (item 60). 80 CUSTOMERS

Yearly Yearly variaton Breakdown by 2013 2012 2013 2012 variation Geographical (%) segment (FS6) (%) Breakdown of which: of which: of which: (FS6) total account total account total account Individuals 930,231 952,481 -2.3 holders holders holders Mass market 734,764 748,223 -1.8 Liguria 498,408 436,100 520,572 443,951 -4.3 -1.8 Affluent 169,762 178,035 -4.6 Piedmont 56,581 51,087 56,387 50,611 0.3 0.9 Private 25,705 26,223 -2.0 Val D’Aosta 2,609 2,367 2,596 2,348 0.5 0.8 Businesses 129,833 133,475 -2.7 Lombardy 96,247 86,280 96,787 86,172 -0.6 0.1 Large corporate 1,093 1,208 -9.5 Veneto 74,247 65,639 75,472 65,866 -1.6 -0.3 Corporate 7,892 8,606 -8.3 Emilia Romagna 21,020 18,680 20,917 18,363 0.5 1.7 Small business 47,244 47,652 -0.9 Tuscany 130,962 103,426 133,049 102,067 -1.6 1.3 Small Economic 73,604 76,009 -3.2 Umbria 3,605 2,825 3,597 2,771 0.2 1.9 Operators

Marche 6,112 5,351 6,036 5,232 1.3 2.3 Public bodies 36,993 35,630 3.8

Latium 69,739 54,714 70,601 54,789 -1.2 -0.1 Other 5,311 5,808 -8.6

Apulia 14,846 11,817 14,542 11,317 2.1 4.4 Total 1,102,368 1,127,394 -2.2

Sicily 108,426 80,855 107,467 78,825 0.9 2.6

Sardinia 19,429 17,332 19,198 17,079 1.2 1.5

Others 137 5 173 8 -20.8 -37.5

Total 1,102,368 936,478 1,127,394 939,399 -2.2 -0.3

81 CUSTOMERS

Yearly Yearly Breakdown by Breakdown by age 2013 2012 variation 2013 2012 variation legal status (FS6) (FS6) (%) (%) Natural persons 1,007,047 1,034,152 -2.6 0-25 50,016 50,323 -0.6 Corporations 31,506 31,827 -1.0 26-35 97,796 104,417 -6.3 of which: Joint-stock 3,182 3,299 -3.5 36-55 388,381 401,046 -3.2 Limited liability 28,315 28,517 -0.7 companies 56-75 322,513 328,781 -1.9 Others 9 11 -18.2 > 75 148,341 149,585 -0.8 Partnership companies 23,369 24,138 -3.2 Total 1,007,047 1,034,152 -2.6

Cooperative companies 2,281 2,280 0.0 Foreign companies 259 246 5.3 Yearly Breakdown by Public bodies 37,903 34,725 9.2 2013 2012 variation seniority (FS6) Others 3 26 -88.5 (%) Total 1,102,368 1,127,394 -2.2 Up to 1 year 76,443 79,036 -3.3 1-5 130,886 140,629 -6.9 5-10 153,490 186,643 -17.8 >10 years 741,549 721,086 2.8 Total 1,102,368 1,127,394 -2.2

82 CUSTOMERS

Cassa di Banca del Cassa di Commercial performance Yearly Customer satisfaction indicators: Carige 2013 2012 Carige Risparmio Monte di Risparmio indicators variation individual customers (PR5) Italia di Savona Lucca di Carrara Retention (total customers) 92.66 92.89 -0.23 score 7+8 (1) (%) 2013 Retention (account holders) 93.77 93.55 0.22 Atmosphere/kindness in branch 71 78 80 80 70 Acquisition (total customers) 5.32 5.47 -0.15 Acquisition (account holders) Operational staff 88 91 90 93 85 5.91 6.61 -0.70 Development (total customers) 97.98 98.35 -0.37 Service offered 79 85 84 81 81 Development (account holders) 99.69 100.16 -0.47

Products/Services 70 80 71 72 77 Cross selling 31 products (no.) 4.04 3.98 0.06 Percentage values Cost/Efficiency ratio 42 52 45 41 44

Imagine (trust) 76 81 84 80 80

Imagine (customer-oriented approach) 63 71 76 70 67

CSI-customer satisfaction index (overall) 78 82 79 79 79

Individual customers/customers (%) 85.3% 84.5% 81.5% 77.6% 83.7%

Statistically significant positive changes on the previous year 2012

Statistically significant negative changes on the previous year 2012

(1) Maximum customer satisfaction score (score 7+8), ranging from a minimum of 3 and a maximum of 8. Source: ABI Observatory /Gfk Eurisko “Retail Customer Satisfaction ”, May 2013.

83 CUSTOMERS

Complaints by type of service/product Complaints by reason (no.) 2013 2012 2013 2012 provided (no.) Execution of transactions 365 304 Investment services 57 47 Application of terms and conditions 140 140 Current accounts and savings deposits 372 369 Fraud and loss 51 42 Total deposits 429 416 Creditworthiness or similar 41 50 Credit granting 90 58 Equipment malfunctioning 28 18 Personal loans and consumer credit 16 23 Reports to the Central Credit Register 44 38 Mortgages 160 43 Compound interest 70 57 Other types of financing 59 34 Information and Communication to customer 91 95 Total lending to customers 325 158 Terms and conditions 150 44 Bills /Bank receipts (Riba) and other payment services 84 73 Organisational issues 52 21 Cheques 56 54 Employees 61 30 Transfers - Payrolls 95 63 Other 59 58 Debit/ Credit cards 94 80 Total 1,152 897 Foreign transactions 2 - Total services to customers 331 270 Insurance Products Pension Funds 26 21 Total Insurance Products Pension Funds 26 21 Website – General Aspects - Other 41 32 Total Website – General Aspects - Other 41 32 Total 1,152 897

84 COMMUNITY

2013 Field of intervention no. of amount initiatives Sport 225 1,644 Community 151 128 Territory 152 830 Non-profit entities 80 151 Religious entities 73 78 Conventions 68 79 Culture 306 675 Institutions and categories 319 1,962 Other 50 309 Total 1,424 5,857

Amounts in thousands of €

85 EMPLOYEES

Total workforce by 2013 2012 employment contract (LA1) Total Men Women Total Men Women Employees at the end of the year 5,385 2,807 2,578 5,432 2,841 2,591

Open-ended employment 5,356 2,790 2,566 5,410 2,827 2,583 contract

of which: Fixed-term contract 2 2 2 2 Apprenticeship contract 27 15 12 20 12 8

of which: full time 4,990 2,792 2,198 5,046 2,824 2,222

part time 395 15 380 386 17 369 Average collaborators in the year 43 21 22 54 22 32

86 EMPLOYEES

Total workforce by 2013 2012 2013 2012 geographical distribution Percentage (place of work) (LA1) Total Men Women Total Men Women Percentage of of employees employees receiving Northern Italy 4,118 2,120 1,998 4,151 2,138 2,013 Work evaluation (LA12) (1) receiving regular regular performance performance and Centre 910 445 465 922 459 463 and career development career development rewiews Southern Italy and Islands 347 236 111 348 238 110 rewiews Total Italy 5,375 2,801 2,574 5,421 2,835 2,586 Middle managers 100% 100% Abroad 10 6 4 11 6 5 Professional areas 100% 100% Total 5,385 2,807 2,578 5,432 2,841 2,591 (1) For executives, work evaluation is included in the incentive scheme Liguria 2,930 1,473 1,457 2,955 1,484 1,471 Rest of Italy and abroad 2,455 1,334 1,121 2,477 1,357 1,120 Total 5,385 2,807 2,578 5,432 2,841 2,591

Total workforce by 2013 2012 2013 2012 employment type (LA1) Total Men Women Total Men Women Career progress of which: of which: Total Total Executives 75 65 10 78 67 11 Women Women 86.7% 13.3% 85.9% 14.1% Among professional areas 26 19.2% 382 40.1% From professional areas to Managers 1,419 927 492 1,440 942 498 4 50.0% 110 45.5% managers 65.3% 34.7% 65.4% 34.6% Among managers 13 38.5% 153 30.1% Professional areas 3,891 1,815 2,076 3,914 1,832 2,082 From managers to executives - 7 - 46.6% 53.4% 46.8% 53.2% Total 43 652 Total 5,385 2,807 2,578 5,432 2,841 2,591

87 EMPLOYEES

Breakdown by indicator 2013 2012 2013 2012 New hires (LA2) of diversity (by gender) (1) Total Men Women Total Men Women (LA13) Total Men Women Total Men Women With open-ended employment contracts 52 31 21 52 20 32 Positions: Staff leasing - - - 2 - 2 Executives 1.4% 2.3% 0.4% 1.4% 2.3% 0.4% ------Apprenticeship Managers 26.3% 33.0% 19.1% 26.5% 33.2% 19.2% ------Internship Professional areas 72.3% 64.7% 80.5% 72.1% 64.5% 80.4% With Fixed term employment contracts ------Protected categories: 9.6% 7.1% 12.3 9.5% 6.9% 12.3% Education: Staff leasing ------Degree 32.3% 34.0% 30.5% 31.8% 33.7% 29.7% Internship High school diploma 60.1% 57.4% 63.1% 62.2% 57.7% 67.2% Total 52 31 21 54 20 34 Other 7.6% 8.6% 6.4% 6.0% 8.6% 3.1% 2013 2012 Terminations (LA2) Total Men Women Total Men Women

Age: Voluntary resignation 15 10 5 12 8 4 Contract expiration 2 2 - - - - Under 30 4.3% 4.0% 4.7% 5.2% 5.0% 5.4% Retirement 73 38 35 75 39 36 30 to 50 52.2% 49.7% 55.0% 53.6% 51.2% 56.3% Dismissal 3 2 1 4 4 - Over 50 43.5% 46.3% 40.3% 41.2% 43.8% 38.3% Other 6 2 4 8 4 4 Total 99 54 45 99 55 44 Average age (years) 47 48 46 46 46 46

(1) Percentages are calculated on total by gender.

88 EMPLOYEES

Rate of new 2013 2012 hires and Recruitments Turnover Recruitments Turnover turnover (LA2)

No. of Rate Rate No. of Rate of No. of No. of Rate of new of new of new terminations turnover(2) hires terminations turnover (2) hires hires(1) hires(1) Title:

Executives 1 0.02% 4 0.07% 3 0.06% 6 0.11% Managers 2 0.04% 28 0.52% 3 0.06% 28 0.52% Professional areas 49 0.91% 67 1.24% 46 0.85% 65 1.20% Gender:

Men 31 0.58% 54 1.00% 20 0.37% 55 1.01% Women 21 0.39% 45 0.84% 32 0.59% 44 0.81% Age:

< 30 34 0.63% 1 0.02% 31 0.57% 0 - From 30 to 50 16 0.30% 10 0.19% 17 0.31% 17 0.31% Over 50 2 0.04% 88 1.63% 4 0.07% 82 1.51% Region:

Liguria 29 0.54 58 1.08% 50 0.92 60 1.10% Rest of Italy and abroad 23 0.43 41 0.76% 2 0.04 39 0.72% Total 52 0.97% 99 1.84% 52 0.96% 99 1.82%

(1) new hires/employees ratio at the end of the year (2) terminations/employees ratio at the end of the year.

89 EMPLOYEES

2013 2012 Absenteeism and injuries Rest of Rest of (LA7) total Men Women Liguria Italy- total Men Women Liguria Italy- Abroad Abroad Injuries: 90 30 60 52 38 91 40 51 55 36

On the way to or from work 79 22 47 45 24 66 28 38 41 25 During work time 21 8 13 7 14 25 12 13 14 11 Injury rate TI (total number of accidents/ total number of working hours x 1.76 1.1 2.51 1.85 1.64 1.76 1.45 2.12 1.95 1.54 200,000

Severity index IG (total number of lost days/total 51.00 38.40 41.80 51.31 50.62 49.57 44.47 55.43 52.65 45.84 number of working hours) x 200,000

Absentee rate (days of absence/total working 12,557 11,339 13,883 13,378 11,565 11,068 9,776 12,490 12,136 9,780 days) x 200,000

90 EMPLOYEES

2013 2012

Combined Combined Parental leave (LA15) Total Men Women Total Men Women Liguria Others Total Liguria Others Total Liguria Others Total Liguria Others Total Entitlement to parental leave 94 31 27 58 23 13 36 129 35 31 66 32 31 63 Using parental leave 31 3 1 4 18 9 27 62 2 1 3 30 29 59 Return to work 31 3 1 4 18 9 27 62 2 1 3 30 29 59 Return to work after 12 months 31 3 1 4 18 9 27 62 2 1 3 30 29 59 Return to work rate 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

2013 2012 2013 2012 Average hours of training per Training (LA10) Nr of training Nr of training employee (LA10) Average yearly hrs/ Average yearly hrs/ hours hours employee employee Gender Gender Men 152,755 164,176 Men 54.42 57.77 Women 138,378 145,109 Women 53.63 56 Category Category Executives 2,663 2,301 Executives 35.50 30.28 Managers 80,539 87,658 Managers 56.76 60.87 Professional areas 207,931 219,326 Professional Areas 53.41 56 No. of training hours in the year 291,133 309,285 Average hours per employee 54 57 of which:

Classroom training 182.370 195.572 Remote training 97.783 105.890 Training on the job 10.980 7.823

91 EMPLOYEES 2013 2012 Training by subject No. Of participants No. Of participants No. of hours Executives Managers Prof Areas No. of hours Executives Managers Prof Areas Insurance 102,962 - 951 2,208 100,291 2 967 2,089

Regulations 48,607 19 1,954 6,625 46,720 65 2,498 6,649

Finance and Markets in Financial Instruments Directive 21,026 8 424 969 21,272 9 755 2,229

Conduct/managerial 22,767 46 278 562 37,584 72 946 861

Credit 45,883 25 744 1,249 25,007 11 534 782

Operational/IT/languages 40,783 45 862 2,437 41,949 17 751 2,533

Commercial 5,686 10 144 443 34,480 3 739 1,618

Other 3,419 14 116 134 1,982 20 59 101

Total 291,132 167 5,473 14,627 309,285 199 7,249 16,862 2013 2012 Training on regulations - areas No. of participants No. of participants No. of hours Executives Managers Prof Areas No. of hours Executives Managers Prof Areas Administrative liability of institutions (Leg 144 4 68 1,090 4 110 316 Decree.231/2001) (SO3)

Transparency and usury 392 17 81 1,636 108 301

“Pattichiari” Consortium 12,704 426 1,612 17,193 1 576 2,029

Safety (Leg. Decree 81/2008 – Leg. Decree 626/94) 9,885 12 447 1,160 9,819 55 530 657

Privacy 532 21 112 1,524 97 284

Anti - money laundering 14,237 2 740 2,521 13,197 981 2,818

Other regulatory issues 10,713 5 299 1,071 2,261 5 96 244

Total 48,607 19 1,954 6,625 46,720 65 2,498 6,649

92 EMPLOYEES

2013 2012 Workplace safety training programmes (LA8) Number Number Participants Participants of hours of hours

Emergency responders, of which: 5,471 1,220 4,440 740 Fire prevention 60 15 180 45 First aid 5,411 1,205 4,260 695 Newly hired employees 280 52 652 45

Safety experts (Workers’ Safety Representative, Security Officer, etc.) 2,712 340 3,816 477

Women’s gross 2013 2012 average salary VS men’s (LA14) Basic salary (1) Remuneration (2) Basic salary (1) Remuneration Executives 101% 92% 93% 90% Managers 102% 93% 94% 93% Professional Areas 99% 97% 98% 97% Total average 91% 86% 87% 85%

(1) Basic salary: gross annual salary comprising contract provisions and integrations. (2) Remuneration: gross annual salary (fixed compensation) + variable compensation, i.e. incentive system, company bonuses.

93 SUPPLIERS

2013 2013 Turnover by amount Geographical Area (EC6) no. suppliers turnover no. suppliers turnover Up to EUR 100,000 5,588 48,149,442 Northern Italy 4,014 204,856,686 From 100,001 to 500,000 210 44,924,061 Centre 1,171 35,727,013 From 500,001 to 1,000,000 43 30,215,852 Southern Italy and islands 635 6,164,026 Over 1,000,000 48 127,780,370 Total of national suppliers 5,820 246,747,725 Total 5,889 251,069,725 Abroad 69 4,322,000 Total 5,889 251,069,725

2013 Types of purchase no. suppliers turnover Immovable assets and movable assets’ 1,000 42,751,082 management IT 134 51,148,404 Telephone, post, energy, data 51 36,217,756 transmission, cleaning expenses Professional and legal expenses 1,774 41,314,005 Advertisement and similar 901 7,910,573 Transport 16 7,037,719 Other 2,013 64,690,186 Total 5,889 251,069,725

Amounts referring to expenses and investments.

94 INDICATORS GRI-G3 (3.12)

Indicators Description Coverage Section Page Indicators Description Coverage Section Page 1. STRATEGY AND ANALYSIS Nature of ownership structure and legal 2.6 total The Identity of The Group 7 form Statement from the most senior decision-maker of the organization about Chairman’s Markets served (including geographic 1.1 total 3 the relevance of sustainability to the Message 2.7 breakdown, sectors served and, types of total The Identity of The Group 15 organization and its strategy customers/beneficiaries)

Chairman’s 2.8 Scale of the organization total The Identity of The Group 8 (In various fields. A specific formal Message Significant changes during the reporting Description of key impacts, risks, and commitment related to social and The Identity of 1.2 2.9 period regarding size, structure, or total The Identity of The Group 13 opportunities environmental sustainability is not The Group ownership provided by the Group) Social Reporting 2.10 Awards received in the reporting period total The Identity of The Group 28 2. ORGANIZATIONAL PROFILE

The Identity of 2.1 Name of the organization total 7 The Group

7 The Identity of 2.2 Primary brands, products, and/or services total The Group 13 3.1 Reporting period total Methodological Note 5

Operational structure of the organization, 3.2 Date of most recent previous report total Methodological Note 5 The Identity of 2.3 considering main divisions, operational total 13 The Group 3.3 Reporting cycle total Methodological Note 5 and controlled companies, joint venture

The Identity of 2.4 Location of organization’s headquartes total 7 Contact point for questions regarding the The Group report or its contents 3.4 total Methodological Note 6 Number of countries where the organization operates, name of countries where the organization carries on the The Identity of 2.5 total 15 Process for defining report content, greater part of its operational activity, or The Group including: of particular relevance the sustainability • determining materiality issues covered in the report 3.5 • prioritizing topics within the report partial Methodological Note 5 • identifying stakeholders the organization expect to use the report

95 Indicators Description Coverage Section Page Indicators Description Coverage Section Page

Boundary of the Report (e.g. countries, Governance structure of the organization, 3.6 divisions, subsidiaries, leased facilities, joint total Methodological Note 5 including committees under the highest The Identity of The ventures, suppliers) 4.1 governance body responsible for total 18 Group specific tasks, such as setting strategy or State any specific limitations on the scope organizational oversight 3.7 total Methodological Note 5 or boundary of the report Indicate whether the Chair of the highest governance body is also an executive Basis for reporting on joint ventures, The Identity of The 4.2 officer (and, if so, their function within the total 19 subsidiaries,leased facilities, outsourced Group Methodological Note 5 organization’s management and the reasons operations, and other entities that 3.8 total for this arrangement) can significantly affect comparability The Identity of The Group 13 from period to period and/or between For organizations that have a unitary board organizations structure, state the number and gender of The Identity of The 4.3 members of the highest governance body total 20 Data measurement techniques and bases Group that are independent and/or non-executive of calculation , including assumptions and members 3.9 techniques underlying estimations applied total Methodological Note 5 to the compilation of the Indicators and Mechanisms for shareholders and employees Social Reporting - other information in the report 4.4 to provide recommendations or direction to total 60 the highest governance body Shareholders Explanation of the effect of any re- statements of information provided in Linkage between compensation for 3.10 total Methodological Note 5 earlier reports and reasons for such re- members of the highest governance Social Reporting - statements body, senior managers, and executives 4.5 partial 68 (including departure arrangements), and the Significant changes from previous periods Employees organization’s performance (including social 3.11 in the scope, boundary, or measurement total Methodological Note 5 and environmental performance) methods applied in the report Processes in place for the highest Methodological The Identity of The Table identifying the location of the 4.6 governance body to ensure conflicts of total 22 3.12 total 6 Group Standards Disclosures in the Report interest are avoided Indicators Process for determining the composition, 3.13 External assurance for the Report Not provided in 2013 qualifications, and expertise of the members of the highest governance body and its The Identity of The 4.7 committees, including any consideration of total 18 Group gender and other indicators of diversity

96 Indicators Description Coverage Section Page Indicators Description Coverage Section Page

Internally developed statements of List of stakeholder groups engaged by the mission or values, codes of conduct, 4.14 total Social Reporting 34 The Identity of The organization 4.8 and principles relevant to economic, partial 22 Group environmental, and social performance Methodological Note Basis for identification and selection of and the status of their implementation 4.15 total 5 stakeholders with whom to engage Procedures of the highest governance body for overseeing the organization’s Approaches to stakeholder engagement, identification and management of 4.16 including frequency of engagement by partial Social Reporting 34 economic, environmental, and social The Identity of The type and by stakeholder group 4.9 performance, including relevant risks partial Group and opportunities, and adherence or Key topics and concerns that have been compliance with internationally agreed raised through stakeholder engagement, standards, codes of conduct, and 4.17 and how the organization has responded partial Social Reporting principles to those key topics and concerns, including through its reporting Processes for evaluating the highest governance body’s own performance, The Identity of The 4.10 total 19 particularly with respect to economic, Group environmental, and social performance

Explanation of whether and how the The Identity of The 4.11 precautionary approach or principle is total 24 Group addressed by the organization

Externally developed economic, environmental, and social charters, The Identity of The 4.12 total 22 principles, or other initiatives to which the Group organization subscribes or endorses

Memberships in associations (such as industry associations) and/or national/ international advocacy organizations in which the organization: • Has positions in governance bodies; Social Reporting - 4.13 • Participates in projects or total 56 committees; Community • Provides substantive funding beyond routine membership dues; or • Views membership as strategic

97 Indicators Description Coverage Section Page Indicators Description Coverage Section Page

ECONOMIC PERFORMANCE INDICATORS LA LABOR PRACTICES AND DECENT WORK PERFORMANCE INDICATORS

Direct economic value generated and LA1 Total workforce by employment type total Social Reporting – 62 distributed, including revenues, operating employment contract, and region Employees costs, employee compensation, donations The Economic EC1 total 31 and other community investments, Report Tables 86 retained earnings, and payments to capital 87 providers and governments LA2 Total number and rate of employee total Social Reporting – 63 Coverage of the organization’s defined Social Reporting – turnover by age group, gender, and region Employees EC3 total 69 benefit plan obligations Employees Tables 88 Significant financial assistance received EC4 n/a 89 from government LA3 Benefits provided to full-time employees total Social Reporting – 69 Range of ratios of standard entry level that are not provided to temporary or Employees wage by gender compared to local Social Reporting – EC5 total 69 part-time employees by major operation minimum wage at significant locations of Employees operation LA4 Percentage of employees covered by total Social Reporting – 71 Social Reporting – Policy, practices, and proportion of collective bargaining agreements Employees Employees EC6 spending on locally-based suppliers at total 94 significant locations of operation Tables LA5 Minimum notice period(s) regarding total Social Reporting – 71 Procedures for local hiring and proportion operational changes, including whether it Employees of senior management hired from the Social Reporting – EC7 total 63 is specified in collective agreements local community at locations of significant Employees operation LA6 Percentage of total workforce represented total Social Reporting – 70 Development and impact of infrastructure in formal joint management–worker Employees investments and services provided health and safety committees that help primarily for public benefit through Social Reporting – monitor and advise on occupational health EC8 commercial, inkind, or pro bono total 48 Community and safety programs engagement LA7 Rates of injury, occupational diseases, lost total Social Reporting – 90 days, and absenteeism, and total number Employees of work-related fatalities, by region and by gender Tables

98 Indicators Description Coverage Section Page Indicators Description Coverage Section Page

LA8 Education, training, counseling, prevention, total Social Reporting – 69 HR HUMAN RIGHTS PERFORMANCE INDICATOR and risk-control programs in place to Employees 70 HR1 Percentage and total number of significant n/a assist workforce members, their families, investment agreements that include or community members regarding serious Tables 93 human rights that have undergone human diseases rights screening LA9 Health and safety topics covered in total Social Reportingt – 70 HR2 Percentage of significant suppliers, and n/a formalagreements with trade unions Employees contractors, and that have undergone human rights screening, and actions taken LA10 Average hours of training per year per total Social Reporting – 64 employee by gender, and by employee Employees HR4 Total number of incidents of discrimination Total Social Reporting– 67 category and corrective actions taken Employees Tables 91 SO SOCIETY PERFORMANCE INDICATORS LA11 Programs for skills management and total Social Reporting – 64 lifelong learning that support the Employees SO2 Percentage and total number of business total The Identity of The 22 continued employability of employees and units analyzed for risks related to Group 26 assist them in managing career endings corruption

LA12 Percentage of employees receiving regular total Social Reporting – 66 SO3 Percentage of employees trained in total Tables 92 performance and career development Employees organization’s anti-corruption policies and review procedures Tables 87 SO4 Actions taken in response to incidents of n/a 63 LA13 Composition of governance bodies and total The Identity of The 62 corruption breakdown of employees per category Group according to gender, age group, minority group membership, and other indicators Tables 88 SO7 Total number of legal actions for n/a Social Reporting - 39 of diversity anticompetitive behavior, anti-trust, and Customers monopoly practices and their outcomes LA14 Ratio of basic salary and remuneration of total Social Reporting – 67 women to men by employee category, by Employees 71 SO8 Monetary value of significant fines and n/a Social Reporting - 39 significant locations of operation total number of non-monetary sanctions Customers Tables 93 for noncompliance with laws and regulations LA15 Return to work and retention rates after total Social Reporting – 91 parental leave by gender Employees

Tables

99 Indicator Description Coverage Section Page

PRODUCT RESPONSIBILITY

PR1 Life cycle stages in which health and safety impacts of total Social Reporting - 40 products and services are assessed for improvement, Customers and percentage of significant products and services categories subject to such procedures

PR2 Total number of incidents of non-compliance with total Social Reporting - 39 regulations and voluntary codes concerning health Customers and safety impacts of products and services, by type of outcomes

PR3 Type of product and service information required by total Social Reporting - 38 procedures, and percentage of significant products and Customers services subject to such information requirements

PR4 Total number of incidents of non-compliance with total Social Reporting - 39 regulations and voluntary codes concerning product Customers and service information and labeling, by type of outcomes

PR5 Practices related to customer satisfaction, including total Social Reporting - 46 results of surveys measuring customer satisfaction Customers

Tables 83

PR6 Programs of adherence to laws, standards, and total Social Reporting - 39 voluntary codes related to marketing communications, Customers including advertising, promotion and sponsorship

PR7 Total number of incidents of non-compliance with total Social Reporting - 39 regulations and voluntary codes concerning marketing Customers communications, including advertising, promotion, and sponsorship by type of outcomes

PR8 Total number of substantiated complaints regarding total Social Reporting - 47 breaches of customer privacy and losses of customer Customers data

PR9 Monetary value of significant fines for non-compliance total Social Reporting - 39 with laws and regulations concerning the provision and Customers use of products and services

100 Indicator Description Coverage Section Page Indicator Description Coverage Section Page

FS —SPECIFIC INDICATORS FOR FINANCIAL SECTOR FS9 Coverage and frequency of audits to partial The Identity of The 26 FS1 Policies with specific environmental and n/a - - assess implementation of environmental Group social components applied to business and social policies and risk assessment lines procedures FS10 Percentage and number of companies n/a - FS2 Procedures for assessing and screening n/a - - held in the institution’s portfolio with environmental and social risks in business which the reporting organization has lines interacted on environmental or social FS4 Processes for improving staff competency n/a - issues to implement the environmental and FS11 Percentage of assets subject to positive n/a - social policies as applied to business lines and negative environmental or social FS5 Interactions with clients/investees/ n/a screening business partners regarding FS13 Access points in low-populated or total The Identity of The 17 environmental and social risks and economically disadvantaged areas by type Group opportunities

FS6 Percentage of the portfolio for business total Social Reporting - 37 FS14 Initiatives to improve access to financial n/a lines by specific region, size and by sector Customers services for disadvantaged people Tables 81

82 FS15 Policies for the fair design and sale of total Social Reporting - 38 FS7 Monetary value of products and services total Social Reporting - 41 financial products and services Customers designed to deliver a specific social benefit Customers for each business line broken down by FS16 Initiatives to enhancefinancial literacy by total Social Reporting 55 purpose type of beneficiary -Community FS8 Monetary value of products and n/a - services designed to deliver a specific environmental benefit for each business line broken down by purpose

101 Indicators Description Coverage Section Pag Indicators Description Coverage Section Page

ENVIRONMENT EN16 Total direct and indirect greenhouse gas n/a - - emissions by weight EN1 Materials used by weight or volume n/a - -

EN17 Other relevant indirect greenhouse gas n/a - - emissions by weight EN2 Percentage of materials used that are n/a - - recycled input materials EN18 Initiatives to reduce greenhouse gas n/a - - emissions and reductions achieved EN3 Direct energy consumption by primary n/a - - energy source EN19 Emissions of ozone-depleting substance n/a - - by weight EN4 Indirect energy consumption by primary n/a - - energy source EN22 Total weight of waste by type and disposal n/a - - method EN5 Energy saved due to conservation and n/a - - efficiency improvements EN26 Initiatives to mitigate environmental n/a - - impacts of products and services, and EN6 Initiatives to provide energy-efficient n/a - - extent of impact mitigation or renewable energy based products and services, and reductions in energy EN28 Monetary value of significant fines and n/a - - requirements as a result of these total number of non-monetary sanctions initiatives for non-compliance with environmental EN7 Initiatives to reduce indirect energy n/a - - laws and regulations consumption and reductions achieved

EN8 Total water withdrawal by source n/a - -

102