Table of Contents 1. Country Profile and Bulgarian Economic Overview 2. Fibank and the Bulgarian Banking System 3. Fibank at a Glance 4. Key Figures and Loan Portfolio 5. Company Profile 1. Country Profile and Bulgarian Economic Overview • Country Profile • Bulgarian Economic Overview Country Profile • Full name: Republic of Bulgaria • Memberships: European Union (since 2007), NATO (since 2004) AUSTRIA • Population: 7.3 M HUNGARY • CapitalSWITZ.: Sofia • Area: 110,994 sq km (42,855 sq miles)SLOVENIA Official language: Bulgarian FRANCE • CROATIA • Traditional religion: Orthodox Christianity ROMANIA • Monetary unit: Bulgarian Lev (plural: Levs, code: BGN) COMMONWEALTH OF • A currency board arrangement was established in 1997BOSNIA- through the Bulgarian INDEPENDENT STATES National Bank Act. HERZEGOVINA • Fixed Exchange rate: EUR 1 = BGN 1.95583 (BGN 1 SERBIA EUR 0.51) MONACO• Main tax rates: BULGARIA • corporate tax rate of 10%; MONT. KOS. BLACK Sofia • personal income tax rate ofITALY10%; SEA • Value Added Tax Act (VAT) rate of 20%; MACE- ANDORRA • Main exports: Ferrous and non-ferrous metals, petrol DONIA products, foods and drinks, textiles, machines and equipment ALB. • Payment Systems: RINGS, TARGET2 Madrid BNB, BISERA, BISERA7EUR, BORICA, SEPA, ESROT, CENTRAL DEPOSITARY GREECE TURKEY Balearic Lisbon SPAIN Islands 3 PORTUGAL Algiers Tunis MALTA Gibraltar (U.K.) Valletta Nicosia SYRIA Crete CYPRUS Mediterranean Sea Beirut Rabat Damascus LEBANON IRAQ TUNISIA ISRAEL MOROCCO Tripoli Tel Aviv-Yafo Amman JORDAN Cairo ALGERIA SAUDI ARABIA LIBYA EGYPT Red Sea Bulgarian Economic Overview Macroeconomic Indicators 2010 2011 2012 2013 2014 EUR M 36,052 38,504 39,667 39,940 42,010 GDP growth, % 0.4 1.8 0.8 0.9 1.7 EUR M (533.1) 33.2 (458.0) 848.2 359.2 Current account % of GDP (1.5) 0.1 (1.1) 2.1 0.9 EUR M 1 151 1 330 1 142 1 275 1 306 FDI % of GDP 3.1 3.3 2.8 3.1 3.1 Budget deficit/ % of GDP (3.2) (2.0) (0.4) (1.8) (3.7) surplus Growth of Real GDP, Consumption and Investments Bulgaria Current Ratings Date Outlook Rating 22 July 2011 Stable Baa2 12 Dec 2014 Stable BB+ 10 Jan 2014 Stable BBB- 4 Source: Bulgarian National Bank, National Statistical Institute, Ministry of Finance Bulgarian Economic Overview Main Economic Indicators – Bulgaria and Euro area GDP (growth, %) HICP inflation ( period average, %) Unemployment rate ( %) . Growth this year is forecast to rise to 1.7% for EU; . Positive impact on growth are: – low oil price – depreciation of the euro – ECB has announced quantitative easing – European Commission has presented its Investment Plan for Europe; 5 Source: Spring Forecast 2015 by Ministry of Finance 2. Fibank and the Bulgarian Banking System • The Banking System Structure • Current Status of the Bank System • Fibank and Bulgarian Banking System • Fibank: Market Share and Market Position Banking System Structure The Bulgarian banking sector comprises of 28 banks, allocated in three groups based on BNB classification: The five largest banks The other The Foreign bank based on total assets Bulgarian banks branches in Bulgaria Group I: Group II: Group III: • UniCredit Bulbanк • Raiffeisenbank, Bulgaria • Alpha Bank, Bulgaria branch • DSK Bank (OTP Group) • Societe Generale Expressbank • Citi Bank Europe - Bulgaria branch • First investment bank • Central Cooperative Bank • BNP Paribas S.A., Sofia branch • United Bulgarian Bank (NBG Group) • Piraeus Bank Bulgaria • ING Bank N.V., Sofia branch • Eurobank EFG, Bulgaria • Cibank • T.C. Ziraat bank, Sofia branch • Allianz Bank, Bulgaria • Isbank Gmbh-Sofia branch • Bulgarian Development Bank • Investbank • Procredit Bank • Municipal Bank • International Asset Bank • Bulgarian-American Credit Bank • D Commerce Bank • TBI Bank • Tokuda Bank • Commercial Bank Victoria • Texim Bank 7 Source: Bulgarian National Bank and National Statistical Institute, December 2014 Current Status of the Bank System Banking Sector as at 31 December 2014 у/oy 2010 2011 2012 2013 2014 At the end of December the banking system remained Bank system assets, BGN M 73,726 76,811 82,416 85,747 85,135 stable registering growth and good financial results. Growth of assets in the bank system,% 4.0 4.2 7.3 4.0 -0.7 During the last quarter of 2014 the liquidity Bank system profit, BGN M 616.6 586 566.8 584.9 746.3 position, profitability and balance sheet capital were Profit growth, %, y/oy (20.96) (4.9) (3.3) 3.2 27.6 further strengthened; Bank system deposits, BGN M 46,928 52,808 57,256 62,230 63,710 For Q4 2014: Growth of deposits, % 8.4 12.5 8.4 8.7 2.4 Bank system loans, BGN M 53,073 55,208 56,847 57,376 54,158 . increase in bank assets reached 4.2%; Growth of loans, % 2.9 4.0 3.0 0.9 -5.6 . growth in deposits is 6.2%; Capital adequacy, % 17.48 17.53 16.7 16.85 21.95 . increase in corporate lending reached 0.8%; Liquidity, % 24.37 25.57 26.0 27.1 30.12 . Growth in loans to non-banks is 2.3%. Loans and Deposits % of GDP 100 80 60 40 20 0 2010 2011 2012 2013 2014 Loans Deposits 8 Source: Bulgarian National Bank and National Statistical Institute, December 2014 Fibank and the Bulgarian Banking System Fibank and the Banking Sector as at 31 December 2014 in BGN M December 2013 December 2014 Growth Banking system 85,747 85,135 (0.7%) Assets Fibank 7,446 8,646 16.1% Deposits (other than Banking system 62,230 63,710 2.4% from credit institution) Fibank 6,398 7,410 15.8% Deposit of individuals Banking system 39,248 41,003 4.5% and households Fibank 4,984 5,545 11.3% Banking system 57,376 54,158 (5.6%) Loans to non-banks Fibank 5,096 6,250 22.6% Banking system 9,115 8,986 (1.4%) Consumer loans Fibank 530 640 20.8% Banking system 9,389 9,304 (0.9%) Mortgage loans Fibank 356 636 78.5% Banking system 38,306 34,319 (-10.4) Corporate loans Fibank 4,210 4,974 18.1% in '000 December 2013 December 2014 Growth Banking system 585 746 27.6% Profit Fibank 25.9 30.5 17.7% 9 1 Source: Bulgarian National Bank and National Statistical Institute, December 2013 and December 2014 ; Unconsolidated – unaudited data Fibank: Market Share and Market Position Market share As at December 2014 Market position 13.5% Deposits from individual and households 2nd 11.7% Lending to businesses and individuals 2nd Fibank is the third largest bank in 10.2% Assets 3rd terms of assets; 11.6% Deposits other than from credit institutions 3rd 11.5% Loans to non-banks 3rd Fibank is the only bank with Bulgarian capital in the Top 5. 6.8% Mortgage loans 5th 7.1% Consumer lending 7th 5.4%/6.5% Trade finance, Sent/Received 8.8%/11.4% Payments, Sent/Received Top 10 Banks Total assets Deposits NFI Loans NFI 14 844 UniCredit 10 779 UniCredit 10 465 UniCredit 12 728 8 700 9 316 9 978 DSK (OTP Group) 8 017 DSK (OTP … 7 035 DSK (OTP Group) 8 882 6 999 7 029 8 646 Fibank 7 410 Fibank 6 250 Fibank 7 446 6 398 5 096 6 570 UBB (NBG Group) 5 114 UBB (NBG … 4 838 UBB (NBG Group) 6 715 5 207 4 920 6 146 Eurobank 5 077 4 256 Raiffeisenbank 5 698 4 520 Eurobank 4 224 5 981 Raiffeisenbank 4 235 3 930 Eurobank 5 960 4 175 Raiffeisenbank 4 664 4 572 CCB 3 717 3 205 SG Expressbank 3 665 3 285 SG … 2 882 3 584 As at CCB 4 181 SG Expressbank 2 639 Piraeus 2 487 3 746 2 491 December'14 3 663 Piraeus 2 262 1 738 Alpha Bank 3 655 1 820 CCB 1 684 As at December'13 3 250 Allianz Bank 1 797 1 476 Piraeus 3 356 1 596 CIBANK 1 371 10 Source: Bulgarian National Bank and National Statistical Institute, December 2013 and December 2014; Unconsolidated - unaudited data 6 3. Fibank at a Glance Fibank at a Glance 2003-2005: Fibank entered into10 Subordinated term debt agreements Shareholders’ structure for the total amount of EUR 28 M included in the Tier 2 capital; In August 2005, the Bank issued its first perpetual subordinated bonds with par value of €27 M included in the Tier 2 capital. The arranger of the instrument was Dresdner Bank; 2006: Fibank issued a perpetual debt for the total amount of €21 M included in the Tier 2 capital; In October 2006 Fibank issued 1 M ordinary shares with nominal value of BGN 10 each - total BGN 10 M. All of the newly issued shares have been fully paid up. Each of the founding shareholders acquired new shares pro rata from the capital increase; In December 2006 reserves and retained earnings were converted into 8 M ordinary shares distributed pro rata to existing shareholders; In March 2007 Fibank decided on 10 for 1 stock split, where 10 M shares with nominal value of BGN 10 each were replaced by 100 M shares with nominal value BGN 1 each; In May 2007 Fibank issued 10 M new ordinary shares through an IPO. FFBH offered 6.5 M shares of its stake in Fibank‟s share capital. The issue was oversubscribed nearly 6 times; 2011: Fibank issued a new €20 M perpetual debt instrument which was included in the additional Tier I capital of the Bank, meeting all requirements of Basel 3; *Capital (BGN M) 2012: A second tranche of €20 M perpetual debt instrument was issued 800 727.0 which was included in the additional Tier I capital of the Bank, meeting all 692.5 requirements of Basel 3; 600 505.3 433.2 470.0 2012: Fibank issued a new hybrid instrument (bond issue) under private 400 subscription with a nominal value of €20 M constituting the first tranche of a bond issue with a total amount of up to €60 M.