An introduction to the UBI Banca Group June 2015 Disclaimer This document has been prepared by solicitation, offer, invitation or Group, please refer to publicly available Unione di Banche Italiane Scpa (“UBI”) for recommendation to purchase, subscribe information, including Annual, Quarterly informational purposes only. or sell for any investment instruments, to and Interim Reports. 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This document does not constitute a For further information about the UBI Page 1 Agenda The UBI Banca Group Background UBI Banca and its Peers UBI Banca’s profile in a snapshot The Group Structure Presence in Italy The UBI Banca International Network Contacts Annexes Page 2 Background Unione di Banche Italiane Scpa (“UBI Banca”) was formed following the merger of the BPU Banca and Banca Lombarda e Piemontese Groups (1st April 2007) The history of UBI Banca is marked by a succession of mergers which have led banks with strong roots in local communities to become the significant reality that exists today and employs approximately 18,000 people. Birth of the “BPU Birth of the “Banca Birth of the “Società Banca Group” from Mutua Popolare Acquisition of per la Stagionatura e the integration of della Città e “Banca l’Assaggio delle Sete Acquisition of “Banca BPB-CV and BPCI 1st April 2007 Provincia di Carime” by ed Affini” Popolare di Ancona” 2003 Birth of Bergamo” , Merger of BPB and BPCI subsequently (BPA) by BPB-CV. Birth of “UBI Banca” subsequently “Credito Varesino” 2001 renamed “Banca the BPB-CV Group following the renamed “Banca (BPB-CV) Popolare 1996 merger of the Popolare di 1992 Commercio e BPU Banca Bergamo” (BPB) Industria” (BPCI) Group and the 1869 1888 Banca Lombarda e 2000 Piemontese Acquisition of “Banca Regionale Group Europea”* by Banca Lombarda. 1998 The Group takes the name of Merger of CAB and BSPB “Banca Lombarda e Piemontese 1963 with the creation of “Banca Group” 1888 BSPB acquires Lombarda” as parent 1883 Birth of the “Banca “Banca di Valle company and contribution of Birth of the San Paolo di Camonica” (BVC) branch network of CAB and “Credito Agrario Brescia” (BSPB) BSPB to “Banco di Brescia”0 Bresciano” (CAB) * Banca Regionale Europea was created in 1994 following the merger between “Cassa di Risparmio di Cuneo” and “Banca del Page 3 Monte di Lombardia” Background UBI Banca is a cooperative bank (“società cooperativa”). Its capital is represented by ordinary shares . Shareholders are divided between unregistered shareholders (who have a right to share in dividends, options, etc. but have no voting rights) and registered shareholders (who have both the right (i) to share in dividends, options, etc., and (ii) to vote at general meetings). To become a registered shareholder, one must own and hold at least 250 shares and apply to the management board. Each registered shareholder has only one vote. No one may hold shares amounting to more than 1% of the share capital (with the exception of collective investment companies). As at March 2015, voting shareholders number nearly 81,000*. A recent Law (March 2015) has established that cooperative banks with total assets above 8€ bln must transform into Joint Stock Companies. Bank of Italy has recently issued instructions (11 June) and the Popolari involved have 18 months to transform into Joint Stock Companies. UBI Banca, which totals €120 bln of total assets, is one of the Banks involved in this process. UBI Banca is listed on the Milan Stock Exchange and included in the FTSE/MIB index. UBI Banca’s governance model is based on a “dualistic” system. Under this dualistic governance system, the registered shareholders appoints a Supervisory Board (strategy and supervision); the Supervisory Board, in turn, appoints a Management Board (day-by-day management of the bank) 54.2 37.7 Market Capitalisation** as at 12th June 2015 # 3 (EUR bln) 6.7 Source: “Il Sole 24ore” – Italian Financial Newspaper – 5.5 Dated 13th June 2015 4.1 3.7 * Total shareholders (voting and non voting) number around 150,000 ** MPS quotations not reported as the Bank is under capital increase Page 4 UBI Banca and its Peers No. of branches as at 31st March 2015 Total assets as at 31st March 2015 (€ bln) 7,361 840 5,779 682 2,225 # 5 1,852 1,560 188 # 5 1,273 702 126 120 61 49 Customer loans as at 31st March 2015 (€ bln) Total direct funding as at 31st March 2015 (€ bln) 573 483 370 346 # 4 # 4 123 132 91 85 81 86 44 33 44 37 Page 5 Source: Press releases. UBI Banca’s profile in a snapshot: predominant retail business, solid capital base and low risk profile 1st Italian cooperative banking Group by market capitalization Strong EUR 84.6 bn customer lending and EUR 91.1 bn direct funding (loan/deposit ratio: 92.9%) competitive As at 31 December 2014, 81.5% of loans to customers were granted in Northern Italy, 10.2% in positioning Central Italy and 8.3% in Southern Italy, while 72.5% of customer deposits came from Northern Italy, 12.6% from Central Italy and 14.9% from Southern Italy Capital ratios as at 31 Mach 2015: Solid Capital CET 1 ratio phased in: 12.45% vs. 9.5% SREP requirement CET 1 ratio fully loaded under Basel 3 rules: 12.20% and Balance Sheet Position Leverage ratio under Basel 3 (tier one capital / (on- and off-balance-sheet assets)) is at 5.82% phased in, 5.73% fully loaded Sound Liquidity position: the Group already complies with the Net stable Funding Ratio and Liquidity Coverage Ratio as per Basel 3 requirements (also net of TLTRO) Good Asset Good asset quality compared to the Italian banking system Quality Annualised cost of credit of 90 bps of total loans Focus on traditional banking activities: Customer loans/total assets at 70.6% Low Risk Profile Funding mainly from own customer base (over 80%); limited recourse to institutional markets Financial assets/total assets: 19.4%. Italian Govies represent approx.18% of total assets Figures as at 31 March 2015 unless otherwise stated Page 6 * Data referred to banking perimeter only. The Group Structure UBI BANCA provides management, co-ordination, control and supply of centralized services to the network banks (single IT System, centralised risk management, centralised finance and treasury, commercial coordination, credit coordination, logistics, purchasing, on line banking, etc...) NETWORK BANKS MAIN PRODUCT COMPANIES 100.00% 351 branches ASSET MANAGEMENT UBI Pramerica 100.00% 288 branches (partnership with Prudential US) FACTORING UBI Factor 83.76% (1) Northern 196 branches Italy LEASING UBI Leasing 74.76% (2) 208+3* branches LIFE BANCASSURANCE Lombarda Vita (partnership with Cattolica) Aviva Vita Spa 84.13% (3) Aviva Assicurazioni Vita Spa 66 branches Central 99.54% 208 branches Italy 99.99% Southern 216 branches Italy ** 23 branches, ~ 750 financial advisors 100.00% Information updated as at 31 March 2015, unless otherwise stated * indicates branches outside Italy **Merger between IW Bank and UBI Private Investment completed on 25 May 2015 1) moreover, 16.24% of capital held by Fondazione Banca del Monte di Lombardia Page 7 2) further 24.90% of Banca Regionale Europea capital held by Fondazione Cassa di Risparmio di Cuneo and the rest by minority shareholders 3) moreover, 5.50% of capital held by Cattolica Assicurazioni and the rest by minority shareholders 8 Presence in Italy Introduction to the UBI Banca Group: Predominant Retail Business and Strong Northern Italian Franchise 1 9 Approx. 3.7 million clients, mainly retail 1 762 27 1,560 branches, of which 762 in Lombardy (which 169 38 43 generates over 20% of Italian GDP) Market share in terms of branches above 20% in 7 80 18 some of the richest Provinces such as Bergamo, 17 Brescia and Varese 106 6 Current 94 Market Shares* 78 Branches accounts Loans % & deposits 19 1 Bergamo 22.3 28.7 40.2 Brescia 22.5 27.1 35.0 84 Varese 23.7 27.8 21.0 Cuneo 23.4 18.4 16.0 National market share of 5.4% in terms of branches 1,560 branches in Italy + 6 branches abroad * Market shares calculated as at 30th June 2014 .