1H20 Results

An Excellent First Half, with Resilient

Profitability and Rock-Solid Capital

Position

Additional Value Creation from the Combination with UBI Banca

A Strong Bank for a Digital World

August 4, 2020

ISP Delivered an Excellent First Half…

€2.6bn Net income, the best H1 result since 2008 (+13.2% vs 1H19), €3.2bn

excluding provisions for future COVID-19 impacts

Q2 Net income at €1.4bn (best-ever Q2)

Operating income stable vs 1H19(1) thanks to resilient Net interest income and significant

growth in insurance revenues and financial market activities (naturally hedging the

impact of volatility on our fee-based business)

Strong recovery in Commissions in June (best month in H1) and significant acceleration

in AuM Net Inflows in Q2 (€2.2bn vs €0.5bn in Q1)

€12.5bn increase in household sight deposits in H1

(€19.7bn on a yearly basis), fuelling our Wealth Management engine

Strong decrease in Operating costs (-2.8% vs 1H19(1))

Operating margin up 2.8% vs 1H19(1)

Annualised cost of risk down to 46bps (vs 53bps in FY19) excluding

provisions for future COVID-19 impacts

Lowest-ever H1 and Q2 Gross NPL inflow(2), with €1.8bn NPL deleveraging in H1(2)

86% of the ~€3bn minimum Net income target for 2020 already achieved

  1. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition
  2. Excluding the impact from the adoption of the new Definition of Default applied since November 2019

1

… Is Fully Equipped for a Challenging Environment…

Common Equity ratio(1) up at 14.9%, well above regulatory requirements (~+630bps(2)); strong liquidity position, with LCR and NSFR well above 100% and more than €220bn in Liquid assets

€35.6bn NPL deleveraging delivered since the September 2015 peak(3)

and the lowest NPL stock and NPL ratios since 2008

Distinctive proactive credit management capabilities (Pulse, with ~380 dedicated people) coupled with strategic partnerships with leading NPL industrial players (Intrum, Prelios)

~€880m in provisions for future COVID-19 impacts booked in H1

A Wealth Management and Protection company with ~€1 trillion in Customer financial assets

High operating efficiency with Cost/Income ratio down to 48.5%

Successful evolution towards a "light" distribution model, with ~1,000 branches

rationalised since 2018 and significant room for further branch reduction

Strong digital proposition, with ~10m multichannel

clients and ~6m clients using ISP App

Successfully acted to mitigate COVID-19 impact on ISP People and Clients

and support the economy and society

(1) Pro-forma fully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution of 1H20 Net income of insurance companies)

(2) Calculated as the difference between the Fully Loaded CET1 Ratio vs requirements SREP + Combined Buffer

(3) Excluding the impact from the adoption of the new Definition of Default applied since November 2019

2

… and Ready to Succeed in the Future

Continue delivering best-in-class profitability, with minimum ~€3bn Net income in 2020 (assuming cost of risk of ~90bps) and minimum ~€3.5bn Net income in 2021 (assuming

cost of risk of ~70bps), without considering the combination with UBI Banca

Maintain a solid capital position (minimum Common Equity(1) ratio of 13%(2), even when taking into account the potential cash distribution from reserves in light of the 2019 Net income allocated to reserves, subject to ECB approval(2))

Deliver payout ratio of 75% in 2020 and 70% in 2021(3)

The combination with UBI Banca adds significant value by improving asset quality and

delivering synergies with no social costs and very low execution risk due to ISP's

proven track record in managing integrations in Italy

  1. Pro-formafully loaded Basel 3 (considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks and the expected absorption of DTA on losses carried forward). CET1 ratio fully phased in >12%
  2. After 1.1.21
  3. Without considering the combination with UBI Banca. The same payout ratios apply when considering the combination with UBI Banca, excluding from 2020 Net income the portion generated by the negative goodwill not allocated to integration costs and accelerated NPL deleveraging

3

The Italian Economy Is Resilient Thanks to Strong Fundamentals and Can Leverage on Government Interventions and EU Financial Support

Strong Italian household wealth at €10.7tn, of which €4.4tn in financial assets,

coupled with low household debt

Manufacturing companies have stronger financial structures than

pre-2008 crisis levels

Export-oriented companies highly diversified in terms of industry and size, with Italian export growth outperforming that of Germany by 1.5pp in 2019

Banking system by far stronger than pre-2008 crisis levels

Extensive support from Government packages worth €75bn so far (additional €25bn

forthcoming) with guarantees up to €750bn

EU financial support (Next Generation EU) will fund the national recovery and resilience plan providing Italy up to €85bn in grants and up to €121bn in loans(1)

Industrial production rebounded by as much as +42.1% m/m in May

(1) Grants as estimated by Z. Darvas (Bruegel), based on European Commission forecasts. Ceiling for loans calculated as 6.8% of Italy's GNI in 2018

4

Contents

ISP Is Successfully Managing a Challenging Environment

1H20: An Excellent First Half

Combination with UBI Banca

Final Remarks

5

In Recent Years, ISP Has More than Halved NPL Stock, while Strengthening Capital and Improving Efficiency…

NPL Stock

€ bn

Net NPL

x

Net NPL ratio, %

x

Gross NPL ratio, %

x

NPL coverage ratio, %

64.5

-54%

29.9

34.2

14.0

30.9.15

30.6.20(1)

17.2

7.1

10.0

3.5

47.0

53.1

ISP Fully Loaded CET1 Ratio

  • After €1.9bn deduction of accrued dividends, based on the 75% Business Plan payout ratio for 2020

14.9

+1.8pp

13.1

31.12.15

30.6.20(2)

€13.4bn in cash dividends paid

over the past 6 years

Cost/Income

%

50.8

-2.3pp

48.5

31.12.15

30.6.20

A very resilient business model, with 55% of H1 Gross income(3) from Wealth Management and Protection activities

  1. Including the ~€0.9bn gross impact from the adoption of the new Definition of Default applied since November 2019
  2. Pro-formafully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution

of 1H20 Net income of insurance companies)

(3) Excluding Corporate Centre

6

  • and Is Now Far Better Equipped than Peers to Tackle the
    Challenges Ahead

Best-in-class risk profile

Fully Loaded CET1/Total financial illiquid

assets(1), 30.6.20, %

61

+36pp

25

ISP(2)

Peer average(3)

Best-in-class leverage

ratio: 6.6%

Solid capital position

Buffer vs requirements SREP + Combined Buffer(4), 30.6.20, bps

~630

~+250bps

~380

ISP

Peer average(5)

Rock-solid capital base with

~€18bn excess capital(4)

High operating efficiency

Cost/Income, 30.6.20, %

61.1

-12.6pp

48.5

ISP

Peer average(6)

High strategic flexibility to

reduce costs

  1. Total illiquid assets include Net NPL, Level 2 assets and Level 3 assets
  2. 56% including the effect of Real Estate and Art, Culture and Historical Heritage portfolio revaluation
  3. Sample: Barclays, BBVA, BNP Paribas, Credit Suisse, Deutsche Bank, HSBC, Lloyds Banking Group, Nordea, Santander, Société Générale, Standard Chartered and UBS (30.6.20 data); Commerzbank, Crédit Agricole Group, ING Group and UniCredit (31.3.20 data); BBVA, Commerzbank, Crédit Agricole Group, ING Group, Santander and UniCredit (Level 2 and Level 3 assets 31.12.19 data)
  4. Calculated as the difference between the Fully Loaded CET1 Ratio vs requirements SREP + Combined Buffer; only top European banks that have communicated their SREP requirement
  5. Sample: BBVA, BNP Paribas, Deutsche Bank, Nordea, Santander and Société Générale (30.6.20 data); Commerzbank, Crédit Agricole Group, ING Group and UniCredit (31.3.20 data). Source: Investor Presentations, Press Releases, Conference Calls, Financial Statements
  6. Sample: Barclays, BBVA, BNP Paribas, Credit Suisse, Deutsche Bank, HSBC, Lloyds Banking Group, Nordea, Santander, Société Générale, Standard Chartered and UBS (30.6.20 data); Commerzbank, Crédit Agricole S.A., ING Group and UniCredit (31.3.20 data)

7

The Best H1 Net Income of the Past Eleven Years and the Best Q2 Ever

ISP delivered the highest H1 Net income since 2008 and the best-ever Q2

€ m

x

Q2 Net income, € m

Provisions for future COVID-19

impacts (~€880m pre-tax)

~3,160

2,179

2,266

+39%

2,004

1,588

1,690

1,707

1,738

1,402

1,274

2,566

720

422

1H09

1H10

1H11

1H12

1H13

1H14

1H15

1H16

1H17

1H18

1H19

1H20

513

1,002

741

470

116

217

940

901

837

927

1,216

1,415

86% of the ~€3bn minimum Net income target for 2020 already achieved

8

ISP Proactively Implemented a Complete Set of Responses to Mitigate the COVID-19 Impact

ISP proactive response to COVID-19 across key areas

1

2

3

Care for ISP

Continuous

Immediate

People and

support to the

business

Clients

real economy

reaction

and society

4

Ready to face the new environment leveraging ISP's competitive advantages

9

NOT EXHAUSTIVE

1 ISP Promptly Ensured Safe Working Conditions for Its

People and Clients

Main initiatives to ensure safe working conditions for ISP People and Clients

▪

Remote working for ~60,000 ISP People(1), with "digital coach" to sustain the

▪

switch to smart working and share best practices

Agreements with trade unions for extraordinary measures to support families

and childcare and to compensate for COVID-19 work absences in the variable

ISP People

performance bonus(2) calculation

▪

Digital learning enabled for all ISP People in Italy

▪

6 additional days of paid leave for ISP People who work in the branch

▪

network or are unable to work remotely

486 people hired(3) in 1H20, of which 167 joined ISP during the lockdown(4)

▪

"Ascolto e Supporto" project offering mental wellness support to all ISP People

▪

~100% of branches opened and fully operational (advisory by appointment

only)

ISP Clients

▪ Business continuity ensured by the online branch, Internet Banking, App and

ATM/Cash machines (98% active)

▪

Activated remote advisory service, with ~20,000 Relationship Managers

▪

Free extension of ISP health insurance policy coverage to include COVID-19

(1)

As of 30.6.20

(2) Premio Variabile di Risultato

(3)

Italian perimeter

(4)

From March to June 2nd 2020

10

NOT EXHAUSTIVE

2 ISP Actively Committed to Supporting Healthcare Priorities

and the Real Economy During the COVID-19 Emergency

Main initiatives to provide active support to healthcare priorities and the real economy

Voluntary donations

Lending support

to strengthen the National Health System through the Civil Protection Department throughout Italy, and in particular €100m in the most affected areas of Bergamo and Brescia. 16 hospitals and 2 COVID-19 Emergency Centres benefitted from

the donation with the creation of 36 new hospital wards and 500 hospital beds mainly in Intensive and Sub-Intensive Care Units

€10m to support families in financial and social difficulty due to the COVID-19 crisis, of which €5m donated to Ricominciamo Insieme project of the Diocese of Bergamo and €5m donated to the Diocese of Brescia

€6m in donations from the CEO (€1m) and top management's 2019 variable compensation, to strengthen healthcare initiatives, with additional voluntary donations from ISP People and Board of Directors

€3.5m donated through ForFunding - the ISP crowdfunding platform - to support Civil Protection Department initiatives related to the COVID-19 emergency

€1m allocated from the ISP Charity Fund to boost COVID-19 scientific research

€350k donated to Associazione Nazionale Alpini to accelerate the construction of a field hospital in Bergamo

€50bn in credit made available to support companies and professionals for protecting jobs and managing payments during the emergency

€10bn in new credit facilities to boost ~2,500 Italian industrial supplier value chains through the enhancement of the Sviluppo Filiere Program

Programma Rinascimento, including impact loans to micro-enterprises and start-ups, for the recovery and the re- €30m shaping of their business models for the post COVID-19, leveraging on growth and innovation projects boosting

economic growth and social and territorial cohesion, in partnership with the Bergamo Municipality

1st in Italy to launch the suspension of existing mortgage and loan installments for families and companies (before the regulation came into force), ~€47bn already approved(1)

st in Italy to sign the collaboration protocol with SACE, providing immediate support to large corporates and SMEs 1 under the Liquidity Decree: ~€7bn in loans already granted with a guarantee from SACE and ~€10bn in loans with a

State guarantee(1)

€125m (equal to 50%) of the ISP Fund for Impact will be used to reduce the socio-economic distress caused by COVID-19

(1) As of 24.7.20

11

3 Business Continuity Ensured Thanks to Strong Digital Capabilities

Strong value proposition on digital channels…

…enabled immediate

business reaction

1H20

Enhanced digital service

Flexible and secure remote work infrastructure

Multichannel clients

App users

(4.6/5.0 rating on iOS(1) and 4.1/5.0 on Android(1))

  • of digital operations
  • of digital sales(2)
  • of digital payments(3)

Market Hub(4) orders (average per day)

VPN (secure bank network) (average logins per day)

Internal communication/VC system

(average logins per day)

~9.8m, +1,000k vs 1H19

~6.0m, +1,250k vs 1H19

~55.1m, +25% vs 1H19

~878k, +211% vs 1H19

~7.4m, +130% vs 1H19

~70k, +40% vs 2019

~33k(5), x13 vs 2019

~35k(5), x4 vs 2019

  1. Ranked first among Italian corporates in the "Cyber Resilience amid a Global
    Pandemic" competition organised by AIPSA(6)
  1. As of June 2020
  2. Commercial offer sent to the client (website or App) by Relationship manager or online branch, signed electronically by the clients, or self service purchases
  3. Number of payments with digital wallet (e.g. Apple Pay, Samsung Pay, Google Pay)
  4. IMI C&IB platform for corporate client operations
  5. Data referring to June 2020

(6) Italian Association of Corporate Security Professionals

12

4 ISP Can Leverage Its Competitive Advantages in the New Environment

Key trends

Increased demand for health, wealth and business protection

Riskier environment

Client digitalisation

Digital way of working

Strengthened ESG importance

ISP's competitive advantages

  • Best-in-classEuropean player in Life insurance and in Wealth Management
  • Strong positioning in the protection business (#2 Italian player in health insurance and #3 in non-motorretail with RBM)
  • Distinctive proactive credit management capabilities (Pulse, with ~380 dedicated people)
  • Strategic partnerships with leading NPL industrial players (Intrum, Prelios)
  • Among top 4 in Europe for mobile App functionalities(1), with scale for additional investments
  • Already strong digital proposition with ~10m multichannel clients
  • Strategic partnership with Nexi in payment systems (9.9% stake in Nexi's capital)
  • Accelerated digitalisation with ~60,000 ISP People smart working
  • Strong track record in rapid and effective distribution model optimisation (e.g.,
    ~1,000 branches rationalised since 2018) and possible further branch reduction in light of:
    • Banca 5®-SisalPay strategic partnership
    • ISP high-quality digital channels, to continue serving the majority of clients who have changed their habits during COVID-19
  • The only Italian bank listed in the main Sustainability Indexes(2)
  • Ranked first among peers by MSCI, CDP, Sustainalytics, three of the top ESG international assessments

Awarded "Best Bank in Italy" in the Euromoney awards for Excellence 2020

  1. Source: The Forrester Banking Wave™: European Mobile Apps, Q2 2019
  2. Including: Dow Jones Sustainability Indexes, CDP Climate Change A List 2018, 2019 Corporate Knights ''Global 100 Most Sustainable Corporations in the World Index''

13

Italy's Strong Fundamentals Support the Resilience of the Italian

Economy

Italian YoY GDP growth

Strong fundamentals support the resilience of the Italian economy

%

▪ Wealth of Italian households at €10.7tn, of which €4.4tn in

Households

financial assets

6 - 7

▪ Low level of household debt

▪ Italian companies well positioned to cope with domestic

economic turmoil:

- Manufacturing companies have stronger financial

structures than pre-2008 crisis levels:

Corporates

▫ Profitability: Gross operating margin at 9.1%

0.3

▫ Capitalisation: Equity/Total liabilities at 41%

- Export-oriented companies have become powerhouses

over the past few years, with Italian export growth

outperforming that of Germany by 1.5pp in 2019

▪ The banking system is by far stronger than pre-2008 crisis

levels with:

- Higher capital

Banking system

- Huge NPL reduction

- Higher efficiency, with Cost/Income ratios better than the EU

average

- High diversification of revenues

▪ Stock of assets owned by Public Sector entities ~€1.0tn(2) :

Government

- ~€0.6tn of financial assets

(9) - (10.5)

- ~€0.3tn of Real Estate

2019

2020(1)

2021(1)

- ~€0.1tn of other non-financial assets

  • Extensive support from Government packages worth €75bn so far (additional €25bn forthcoming) with guarantees up to €750bn
  • EU financial support (Next Generation EU) will fund the national recovery and resilience plan providing Italy up to €85bn in grants and up to €121bn in loans(3)
  1. Source: ISP estimates
  2. Not including infrastructure, natural resources, cultural heritage
  3. Grants as estimated by Z. Darvas (Bruegel), based on European Commission forecasts. Ceiling for loans calculated as 6.8% of Italy's GNI in 2018

Source: Bank of Italy; ISTAT; "Analisi dei Settori Industriali" Intesa Sanpaolo - Prometeia October 2019

14

Contents

ISP Is Successfully Managing a Challenging Environment

1H20: An Excellent First Half

Combination with UBI Banca

Final Remarks

15

H1 Impacted by the COVID-19 Outbreak

Italian GDP YoY evolution(1)

Market volatility(2)

10-yearBTP-Bund spread(1)

%

YoY Italy

%

x

Market performance

Bps

QoQ Italy

FTSE MIB Index(3), %

x

Market performance

4

S&P500 Index(3), %

2

0.2

0.1

0.0

0

30.4

-0.2

-2

-4

-6

-5.4

+16.6pp

-8

-10

13.8

-12

-12.4

-14

-16

-18

1Q

2Q

3Q

4Q

1Q

2Q

31.12.19

30.6.20

2019

2020

10.7

(17.6)

Jun.Sept.Dec.Mar. Jun.Sept.Dec.Mar. Jun.

9.8

(4.0)

18

18

18

19

19

19

19

20

20

Countrywide lockdown from March 10th to June 3rd(4)

  1. Source: Bloomberg, ISTAT
  2. Chicago Board Options Exchange (CBOE) Volatility Index; end of the period; source: Bloomberg
  3. Market performance between 30.6.19 and 31.12.19 and between 31.12.19 and 30.6.20

(4) Lifting of all travel restrictions across the country

16

1H20: Highlights

    • Solid economic performancedespite three months of a countrywide lockdown:
      • €2,566m Net income(+13.2% vs 1H19), the best H1 result since 2008(86% of the ~€3bn minimum Net income target for 2020 already achieved)
      • Best-everQ2 Net incomeat €1,415m (+16.4% vs 2Q19(1))
      • ~€3,160m Net income excluding ~€880m in provisionsfor future COVID-19impacts
      • Operating income at €9,075m(stable vs 1H19(1)) and Operating margin at €4,672m(+2.8% vs 1H19(1))
      • Strong recovery in Commissions in June, the best month of H1, and acceleration in AuM Net inflows in Q2
        (€2.2bn vs €0.5bn in Q1)
      • Significant decrease in Operating costs (-2.8%vs 1H19(1)) with Cost/Income ratio at 48.5%and the lowest- ever Administrative costs (-6.3%vs 1H19(1))
      • Annualised cost of risk down to 46bps(vs 53bps in FY19) excluding provisions for future COVID-19 impacts
      • Robust NPL coverage at 53.1% coupled with the lowest-everH1 and Q2 Gross NPL inflow(2)
    • Best-in-classcapital position with balance sheet further strengthened:
      • €5.9bn NPL deleveraging since 30.6.19(2)(€1.8bn in H1(2))
      • The lowest NPL stock and NPL ratiossince 2008
      • Common Equity(3) ratio up at 14.9% (+40bps in Q2),well above regulatory requirements (~+630bps(4)) even under the EBA stress test adverse scenario
      • Best-in-classleverage ratio: 6.6%
      • Strong liquidity position: LCR and NSFR well above 100%; more than €220bn in Liquid assets(5)
  2. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition
  3. Excluding the impact from the adoption of the new Definition of Default applied since November 2019
  4. Pro-formafully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution of 1H20 Net income of insurance companies)
  5. Calculated as the difference between the Fully Loaded CET1 Ratio vs requirements SREP + Combined Buffer
  6. Stock of own-account eligible assets (including assets used as collateral and excluding eligible assets received as collateral) and cash and deposits with Central Banks

17

1H20: Strong Growth in Profitability and Balance Sheet Further Strengthened

Net income

€ m

x Cost/Income, %

Provisions for future COVID-19

impacts

NPL stock

€ bn

Net NPL

x Gross NPL ratio, % x Net NPL ratio, %

2,266

~3,160

+39%

2,566

34.8

29.9-14%

1H19

1H20

49.9(1)

48.5

16.014.0

30.6.1930.6.20(2)

8.47.1

4.13.5

ISP Fully Loaded CET1 Ratio

Excess capital

%

After €1.9bn deduction of accrued

Pro-forma Fully Loaded CET1 Ratio Buffer vs

dividends, based on the 75%

requirements SREP + Combined Buffer(4), 30.6.20, bps

Business Plan payout ratio for 2020

13.9

14.9

~630

~+100bps

~380

~+250bps

30.6.19

30.6.20(3)

ISP

Peer average(5)

  1. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition
  2. Including the impact from the adoption of the new Definition of Default applied since November 2019
  3. Pro-formafully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution of 1H20 Net income of insurance companies)
  4. Calculated as the difference between the Fully Loaded CET1 Ratio vs requirements SREP + Combined Buffer; only top European banks that have communicated their SREP requirement
  5. Sample: BBVA, BNP Paribas, Deutsche Bank, Nordea, Santander and Société Générale (30.6.20 data); Commerzbank, Crédit Agricole Group, ING Group and UniCredit (31.3.20 data). Source: Investor Presentations, Press

Releases, Conference Calls, Financial Statements

18

Our Excellent Performance Creates Benefits for All Stakeholders…

Shareholders

Employees

Net income, € bn

Personnel expenses, € bn

2.6

~3.0

Excess capacity of ~5,000 people being reskilled

86%

(with ~3,800 already redeployed to priority initiatives)

2.7

1H20

2020 minimum

1H20

target

Public Sector

Taxes(1), € bn

1.3

1H20

  1. Direct and indirect
  2. Deriving from Non-performing loans outflow

Households and Businesses

Medium/Long-term new lending, € bn

Of which €35.4bn in Italy

40.2

1H20

~4,300 Italian companies helped to return to

performing status(2) in H1

(more than 116,000 since 2014)

19

  • and Allows ISP to Be the Engine of Sustainable and Inclusive Growth…
  • €50bn in new lending dedicated to the Green Economy
  • €50bn in credit available to support companies and professionals during the COVID-19 emergency
  • More than €100m donated to provide COVID-19 relief
  • €125m (equal to 50%) of the ISP Fund for Impact will be used to reduce socio- economic distress caused by COVID-19

Link to video:https://group.intesasanpaolo.com/en/editorial-section/Intesa-Sanpaolo-The-driver-of-sustainable-and-inclusive-development

20

… Delivering Tangible Results for Society…

SELECTED HIGHLIGHTS

COVID-19 related initiatives

In 1H20 evaluated ~600 start-ups(more than 1,800 since 2018) in 2 acceleration programs (activities switched online due to COVID-19)with 37 coached start-ups(~270 since 2018), introducing them to selected investors and ecosystem players (~5,500 to date)

Supported families and business affected by earthquakes and natural disasters by forgiving mortgages or granting moratoria of

mortgages and subsidised loans (∼130 moratoria in 1H20 for ∼€700m of residual loans) and ∼€97m in subsidised loans granted in 1H20 (∼€431m since 2018)

Ecobonus - ISP ready to buy tax credits: support to families, condominiums and businesses with modular and flexible financial solutions to benefit from the rules introduced by the "Decreto Rilancio" on raising the deduction to 110% for expenses relating to energy efficiency and reduction measures of seismic risk

€5bn Circular Economy credit Plafond: €1,237m already

Donated €100m to strengthen the National Health System through the Civil Protection Department across Italy, and in particular

disbursed (€478m in 1H20)

in the most affected areas of Bergamo and Brescia. 16 hospitals and 2 COVID-19 Emergency Centres have benefitted from the

343 Circular Economy projects evaluated and 119 projects

donation with the creation of 36 new hospital wards and 500 hospital beds mainly in Intensive and Sub-Intensive Care Units

€10m to support families in financial and social difficulty due to the COVID-19 crisis, of which €5m donated to

already financed

Ricominciamo Insieme project of the Diocese of Bergamo and €5m donated to the Diocese of Brescia

Launched the first Sustainability Bond focused on the Circular

€6m in donations coming from the CEO (€1m) and top management's 2019 variable compensation, to strengthen

Economy (amount €750m)

healthcare initiatives, with additional voluntary donations coming from ISP People and Board

S-Loan - In July 2020, ISP launched an innovative solution for SMEs to

€3.5m donated through ForFunding - the ISP crowdfunding platform - to support Civil

finance projects aimed at encouraging companies to improve their

Protection Department initiatives related to the emergency

sustainability profile. The loans will have a reduced interest rate, subject to

€1m allocated from the ISP Charity Fund to boost COVID-19 scientific research

the annual monitoring of 2 ESG KPIs, which must be reported in the

€350k donated to ANA(1) to accelerate the construction of a field hospital in Bergamo

company's annual report. ISP allocated a €2bn plafond for S-Loans as

€50bn in credit made available to support companies and professionals for

part of the €50bn dedicated to the Green Economy

protecting jobs and managing payments during the emergency

Initiatives to reduce child poverty and support people in need well

1st in Italy to launch the suspension of existing mortgage and loan

ahead of Business Plan target, delivering since 2018:

installments for families and companies (before the regulation came into

▪

~10.8 million meals

force), ~€47bn already approved

▪

~537,000 dormitory beds

▪

1st in Italy to sign the collaboration protocol with SACE, providing immediate

~176,000 medicine prescriptions

▪

support to large corporates and SMEs under the Liquidity Decree: ~€7bn in

~114,000 articles of clothing

loans already granted with a guarantee from SACE and ~€10bn in loans with a

ISP's "Giovani e Lavoro" Program underway, in partnership with

State guarantee

Generation, aimed at training and introducing 5,000 young people to

Presented the project for the fourth location of the Gallerie d'Italia in

the Italian labour

market over three years:

Piazza San Carlo, Turin, reaching 6,000 sqm, dedicated to

▪

~4,980 young people, aged 18

-29, applied

to the Program in 1H20

▪

(~14,300 since 2019)

photography, digital world and contemporary art

~990 students interviewed and ~410 students trained/in training

ISP Fund for Impact launched in 4Q18

The Canova / Thorvaldsen exhibition at the Gallerie d'Italia in

through 18 courses

Milan, in partnership with St Petersburg State Hermitage Museum

▪

(

~€1.25bn

lending capacity)

1,300+ companies involved since the beginning of the Program

and Copenhagen's Thorvaldsens Museum, one of the most

"Per Merito", the first line of credit without collateral

visited exhibitions in Italy, continued during the lockdown phase,

~74,000 doctors and nurses participated in the Generation

dedicated to university students residing in Italy, studying

thanks to the launch of the virtual tour with over 8m views

COVID-19 training on PPE, NIV and emergency management

in Italy or abroad; €21m granted in 1H20 (€

60m since

During the lockdown a number of important national cultural

P-Techinitiative, in partnership with IBM, with the

beginning of 2019)

initiatives were produced in digital editions. COVID-19Visual

MAMMA@WORK: A

highly subsidised

loan to balance

objective of training young professionals in the field

motherhood and work in their children's early years of life. Launched

Project-Cortona On the Move, a permanent multimedia

of new digital jobs:

in July 2020, as part of the Fund for Impact

archive with 40 visual projects by 40 international

▪ Mentoring activities started with 10 ISP "mentors"

Two other new initiatives announced in January 2020 to support working

photographers (602,500 Instagram story views on

for 20 young professionals

mothers in India and people over 50 who have lost their jobs or have difficulty

Freeda and ISP profiles); Turin International

▪ Training module on "team work" (webinar)

accessing pension schemes

Book Fair (~5 million views); Turin Archives

provided to all professionals involved in the

Festival (207,000 views)

€30m Programma Rinascimento, including impact loans to micro-enterprises and start-ups,

project

for

the recovery and the re-shaping of their business models for the post COVID-19,leveraging

on

growth and innovation projects boosting economic growth and social and territorial cohesion, in

(1) Associazione Nazionale Alpini

partnership with the Bergamo Municipality

21

ISP Leads in the Main Sustainability Indexes and Rankings

Top ranking(1) for Sustainability

The only Italian

bank listed in the Dow Jones Sustainability Indexes, in the CDP Climate A List 2019 and the 2020 Corporate Knights ''Global 100 Most Sustainable Corporations in the

World Index''

2019 Sustainable Development

Award by ASSOSEF(2) for promotion of the Sustainable Development Goals

69

A

AAA

100

96

61

A

AAA

100

93

61

A-

(3)

AAA

94

(3)

90

59

A-

AA

94

90

58

A-

AA

91

87

58

A-

A

90

85

57

A-

A

88

82

56

A-

A

79

77

55

(3)

A

77

75

B

54

B

A

74

71

53

B

BBB

71

70

53

B

BBB

63

66

52

B

BBB

(3)

61

65

51

C

BBB

60

64

(3)

C

BBB

51

60

49

46

C

BBB

51

57

45

C

BBB

46

53

43

C

BBB

38

42

(D)

  1. ISP peer group
  2. Associazione Europea Sostenibilità e Servizi Finanziari
  3. Natixis

Sources: Bloomberg ESG Disclosure Score (Bloomberg as of 30.6.20), CDP Climate Change Score 2019 (https://www.cdp.net/en/companies/companies-scores); MSCI ESG Score 2019 (https://www.msci.com/esg-ratings);

Robeco SAM (Bloomberg as of 30.6.20); Sustainalytics score (Bloomberg as of 30.6.20)

22

H1: Growth in Profitability Achieved Thanks to Solid Operating Performance in a Challenging Environment

1H20 P&L € m

Non-motor P&C revenues up 85%(2)

Including

~€880m due to

€33m due to

provisions for

9,075

COVID-19

future COVID-

19 impacts

(3)

736

1,257

(2,736)

3,588

(1,136)

4,672

(531)

(1,801)

3,497

Including the €1.1bn Nexi capital gain (of which €0.3bn day-one profit)

3,859

988

Including €277m

~€3,160m

Levies and other

excluding

charges

provisions

concerning the

for future

banking industry(5)

COVID-19

(€394m pre-tax)

impacts

(874) (419) 2,566

Net interest income

Net fees and commissions

Profits on financial

assets and liabilities at fair value

Insurance income

Other operating income/expenses

Operating income

Personnel

Admin.

Depreciation

Operating margin

Loan loss provisions

Other charges/gains(3)

Gross income

Taxes

Other(4)

Net income

Δ% vs

(0.6)

(6.3)

15.1

17.4

n.m.

0.0

(2.5)

(6.3)

3.7

2.8

95.1

n.m.

7.1

(10.9)

18.0

13.2

1H19(1)

Impacted by three

Operating costs -2.8%

-0.4% excluding

months of countrywide

provisions for future

lockdown and volatility

COVID-19 impacts

Note: figures may not add up exactly due to rounding

  1. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition
  2. Excluding credit-linked products
  3. Net provisions and net impairment losses on other assets, Other income (expenses), Income (Loss) from discontinued operations
  4. Charges (net of tax) for integration and exit incentives, Effect of purchase price allocation (net of tax), Levies and other charges concerning the banking industry (net of tax), Impairment (net of tax) of goodwill and other intangible assets, Minority interests
  5. Including charges for the Resolution Fund: €254m pre-tax (€175m net of tax), our commitment for the year fully funded, and €86m pre-tax (€58m net of tax) for the additional contribution

to the National Resolution Fund

23

Q2: The Best-ever Q2 Net Income

2Q20 P&L € m

Impacted by two months of countrywide lockdown. Strong recovery in June, the best

Including

~€880m due to

Including the

€29m due to

provisions for

Including €86m

month of H1

367 12

263

1,744

1,750

4,136

COVID-19

€1.1bn Nexi

future COVID-

capital gain (of

19 impacts

which €0.3bn

day-one profit)

(1,380)

(583)

1,906

1,883

(267)

1,375

(1,398)

Levies and other charges concerning the banking industry(5) (€121m pre-tax)

(313) (155) 1,415

Net interest income

Net fees and commissions

Profits on financial assets and liabilities at fair value

Insurance income

Other operating income/expenses

Operating income

Personnel

Admin.

Depreciation

Operating margin

Loan loss provisions

Other charges/gains(3)

Gross income

Taxes

Other(4)

Net income

Δ% vs

(0.6)

(11.2)

(58.5)

20.7

n.m.

(11.5)

(2.7)

(6.7)

6.0

(19.8)

152.3

n.m.

4.0

(29.8)

4.7

16.4

2Q19(1)

Operating costs -2.9%

Δ% vs

0.2

(5.4)

(73.5)

(0.5)

n.m.

(16.3)

1.8

5.4

1.1

(31.1)

246.9

n.m.

(4.7)

(44.2)

(41.3)

22.9

1Q20(2)

Note: figures may not add up exactly due to rounding

  1. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition
  2. Data restated to take into account the effects of the RBM Assicurazione Salute acquisition
  3. Net provisions and net impairment losses on other assets (including in 2Q20 the write-back of ~€300m in provisions for future COVID-19 impacts booked in 1Q20), Other income (expenses), Income (Loss) from discontinued operations
  4. Charges (net of tax) for integration and exit incentives, Effect of purchase price allocation (net of tax), Levies and other charges concerning the banking industry (net of tax), Impairment (net of tax) of goodwill and other

intangible assets, Minority interests

(5) Including €86m pre-tax (€58m net of tax) for the additional contribution to the National Resolution Fund

24

Net Interest Income: Slight Increase vs Q1 Mainly Due to the Growth in Volumes

Quarterly comparison

Yearly comparison

Net interest income, 2Q20 vs 1Q20

Net interest income, 1H20 vs 1H19

€ m

€ m

+€75m excluding NPL

stock reduction impact

3,517

99

31

3,497

(125)

(25)

1,747

21

2

1,750

(15)

(5)

Commercial

component

Commercial

component

1Q20 Net interest income

Volumes

Spread

Hedging(1)

Financial components

2Q20 Net interest income

1H19 Net interest income

Volumes

Spread

Hedging(1)

Financial components

1H20 Net interest income

Resilient Net interest income, benefitting from increasing and

geographically diversified

lending volumes in H1

Note: figures may not add up exactly due to rounding

  1. ~€80m benefit from hedging on core deposits in 1H20, of which ~€38m in 2Q20

25

~€1 Trillion in Customer Financial Assets, with a €43bn Increase in

Q2 to Fuel Wealth Management Engine

Direct deposits

€ bnm

+€28.5bn

excluding Repos

423.2

425.5

433.6

437.8

30.6.19

31.12.19

31.3.20

30.6.20

+€19.7bn in household sight

deposits on a yearly basis (of

which +€12.5bn in H1, +€6.2bn in

Q2)

Assets under Management

€ bn

+€17.1bn

344.2 358.1 333.6 350.7

30.6.19 31.12.19 31.3.20 30.6.20

  • +€10.5bn of AuM Net inflow on a yearly basis (+€2.6bn in H1, of which +€2.2bn in Q2)
  • Decline vs 31.12.19 due to negative market performance

Assets under Administration

€ bn

+€21.1bn

171.1

176.4

151.7

172.8

30.6.19

31.12.19

31.3.20

30.6.20

Decline vs 31.12.19 due to negative

market performance

26

Continued Strong Reduction in Operating Costs while Investing for Growth

Operating costs

€ m

Administrative costs

Lowest-ever Administrative costs

1,212

1,136

-6.3%

Total Operating costs

1H19(1)

1H20

4,531

Personnel costs

4,403

-2.8%

2,807

2,736

-2.5%

f(x)

1H19(1)

1H20

Investing for growth (+6% on a yearly

Depreciation

basis for IT, Digital, Protection), while

rationalising real estate and others

1H19(1)

1H20

512

531

+3.7%

1H19(1)

1H20

    • ISP maintains high strategic flexibility in managing costs and remains a Cost/Income leader in Europe
    • 2,935 headcount reduction on a yearly basis, of which 189 in Q2
    • ~1,900 additional voluntary exits by June 2021 (of which ~1,400 already exited as of July 1st and ~200 by the end of 2020) already agreed with labour unions and fully provisioned
    • In addition, a further ~1,000 applications for voluntary exits already received and to be evaluated
    • Further possible branch reduction in light of the Banca 5®-SisalPay strategic partnership
  2. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition

27

One of the Best Cost/Income Ratios in Europe

Cost/Income(1)

%

79.9 80.5

77.1

73.1

68.0

Peer average:

61.5

62.2

~61.1%

54.4

55.6

56.5

56.9

57.3

51.1

52.1

45.1

46.8

48.5

Peer 1

Peer 2

ISP

Peer 3

Peer 4

Peer 5

Peer 6

Peer 7

Peer 8

Peer 9

Peer 10

Peer 11

Peer 12

Peer 13

Peer 14

Peer 15

Peer 16

  1. Sample: Barclays, BBVA, BNP Paribas, Credit Suisse, Deutsche Bank, HSBC, Lloyds Banking Group, Nordea, Santander, Société Générale, Standard Chartered and UBS (30.6.20 data); Commerzbank, Crédit Agricole S.A., ING Group and UniCredit (31.3.20 data)

28

Continuous Improvement in Asset Quality, with the Lowest NPL Stock since 2008, Together with the Lowest-ever H1 and Q2 Gross NPL Inflow

NPL stock

€ bn

Net NPL

x

Gross NPL ratio, %

x

Net NPL ratio, %

64.5

€1.8bn deleveraging in H1(1) and

€0.5bn deleveraging in Q2(2) excluding

the impact from the adoption of the

-54%

new Definition of Default

34.8

31.3

30.2

29.9

34.2

16.0

14.2

14.0

14.0

30.9.15

30.6.19

31.12.19(3)

31.3.20(4)

30.6.20(5)

Intrum deal

Prelios deal

17.2

8.4

7.6

7.1

7.1

10.0

4.1

3.6

3.5

3.5

19th quarter of continuous deleveraging at no cost

to shareholders

  1. Excluding the ~€0.3bn gross impact in H1 from the adoption of the new Definition of Default applied since November 2019
  2. Excluding the ~€0.2bn gross impact in Q2 from the adoption of the new Definition of Default applied since November 2019
  3. Including the ~€0.6bn gross impact from the adoption of the new Definition of Default applied since November 2019
  4. Including the ~€0.8bn gross impact from the adoption of the new Definition of Default applied since November 2019
  5. Including the ~€0.9bn gross impact from the adoption of the new Definition of Default applied since November 2019
  6. Inflow to NPL (Bad Loans, Unlikely to Pay and Past Due) from performing loans
  7. Inflow to NPL (Bad Loans, Unlikely to Pay and Past Due) from performing loans minus outflow from NPL into performing loans 29

Gross half-year NPL inflow(6) from performing loans

€ m

Net inflow(7) x Gross Q2 NPL Inflow

x Net Q2 NPL Inflow

from performing loans,

from performing loans,

€ m

€ m

1,949

-19%

1,587

1,308

1,145

1H19

1H20(1)

1,073

816(2)

701

643(2)

Lowest-ever H1(1) and Q2(2) Gross NPL Inflow

Loan Loss Provisions Down, Excluding Provisions for Future COVID-19 Impacts

Loan loss provisions

€ m

€ m

Provisions for future COVID-

19 impacts

1,801

882

923

-0.4%

919

1H19

1H20

Loan loss provisions down 0.4%, excluding

provisions for future COVID-19 impacts

Cost of risk(1)

bps

Provisions for future COVID-

19 impacts

89

53

-7bps

46

FY19

1H20

Annualised cost of risk at 46bps (vs 53bps

in FY19) excluding provisions for future

COVID-19 impacts

(1) Annualised

30

Solid and Increased Capital Base, Well Above Regulatory Requirements

ISP CET1 Ratios vs requirements SREP + Combined Buffer

Fully Loaded CET1 Ratio Buffer vs requirements SREP + Combined Buffer(2)

30.6.20, %

After €1.9bn deduction of accrued dividends, based on the 75% Business Plan payout ratio for 2020

14.6

14.9

~+6.3pp

8.6

30.6.20, bps

~630

~380

~+250bps

ISP 2020 Fully

ISP

ISP Fully

Loaded

Phased-in

Loaded(1) CET1

requirements

CET1 Ratio

Ratio

SREP +

Combined Buffer

ISP buffer vs

Peer average(3)

requirements

buffer vs

SREP +

requirements

Combined

SREP +

Buffer

Combined Buffer

~€18bn excess capital(2)

Note: figures may not add up exactly due to rounding

  1. Pro-formafully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution of 1H20 Net income of insurance companies)
  2. Calculated as the difference between the Fully Loaded CET1 Ratio vs requirements SREP + Combined Buffer; only top European banks that have communicated their SREP requirement
  3. Sample: BBVA, BNP Paribas, Deutsche Bank, Nordea, Santander and Société Générale (30.6.20 data); Commerzbank, Crédit Agricole Group, ING Group and UniCredit (31.3.20 data). Source: Investors' Presentations, Press Releases, Conference Calls, Financial Statements

31

Increased Capital Buffer vs Regulatory Requirements

ISP requirements SREP + Combined Buffer

%

9.4

8.6

-80bps

ISP 2019 Fully

ISP 2020 Fully

Loaded

Loaded

requirements SREP

requirements SREP

+ Combined Buffer

+ Combined Buffer(1)

ISP Fully Loaded CET1 Ratio Buffer vs requirements SREP + Combined Buffer(2)

bps

x CET1 Fully Loaded ratio, %

After €1.9bn deduction of accrued dividends, based on the 75% Business Plan payout ratio for 2020

~590

~630

~460

+170bps

31.12.19

31.3.20

30.6.20(3)

14.1

14.5

14.9

+40bps

  1. Taking into account the regulatory changes introduced by the ECB on 12.3.20, which require that the Pillar 2 requirement can be respected by partially using equity instruments other than CET1 and contextual revisions of the Countercyclical Capital Buffer by the competent national authorities in the various countries
  2. Calculated as the difference between the Fully Loaded CET1 Ratio vs requirements SREP + Combined Buffer
  3. Pro-formafully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution of 1H20 Net income of insurance companies)

32

Best-in-Class Excess Capital

Fully Loaded CET1 Ratio Buffer vs requirements SREP + Combined Buffer(1)(2)

bps

Best-in-class leverage ratio: 6.6%

Fully Loaded CET1 Ratio(2), %

~660

~630

~+250bps

~560

~440

Peer

~350

~350

~340

~310

average:

~280

~380bps

~260

~260

Peer 1

ISP

Peer 2

Peer 3

Peer 4

Peer 5

Peer 6

Peer 7

Peer 8

Peer 9

Peer 10

15.5

14.9(3)

15.8

13.4

13.2

14.0

12.4

12.3

13.2

11.2

11.5

ISP is a clear winner of the EBA stress test

  1. Calculated as the difference between the Fully Loaded CET1 ratio vs requirements SREP + Combined Buffer; the Countercyclical Capital Buffer is estimated; only top European banks that have communicated their SREP requirement
  2. Sample: BBVA, BNP Paribas, Deutsche Bank, Nordea, Santander and Société Générale (30.6.20 data); Commerzbank, Crédit Agricole Group, ING Group and UniCredit (31.3.20 data). Source: Investor Presentations, Press Releases, Conference Calls, Financial Statements
  3. Pro-formafully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution of 1H20 Net income of insurance companies)

33

Best-in-Class Risk Profile in Terms of Financial Illiquid Assets

Fully Loaded CET1(1)/Total financial illiquid assets(2)

%

61

~+36pp

56

50

44

37

28

28

26 25

Peer

19

average:

16

~25%

13

12

12

12

8

7

ISP(3)

Peer 1

Peer 2

Peer 3

Peer 4

Peer 5

Peer 6

Peer 7

Peer 8

Peer 9

Peer 10

Peer 11

Peer 12

Peer 13

Peer 14

Peer 15

Peer 16

More than €220bn in Liquid assets(4) with LCR and NSFR well above 100%

  1. Fully Loaded CET1. Sample: Barclays, BBVA, BNP Paribas, Credit Suisse, Deutsche Bank, HSBC, Lloyds Banking Group, Nordea, Santander, Société Générale, Standard Chartered and UBS (30.6.20 data); Commerzbank, Crédit Agricole Group, ING Group and UniCredit (31.3.20 data)
  2. Total illiquid assets include Net NPL, Level 2 assets and Level 3 assets. Sample: Barclays, BNP Paribas, Credit Suisse, Deutsche Bank, HSBC, Lloyds Banking Group, Nordea, Société Générale, Standard Chartered and UBS (30.6.20 data); BBVA and Santander (Net NPL 30.6.20 data and Level 2 and Level 3 assets 31.12.19 data); Commerzbank, Crédit Agricole Group, ING Group and UniCredit (Net NPL 31.3.20 data and Level 2 and Level 3 assets 31.12.19 data)
  3. 56% including the effect of Real Estate and Art, Culture and Historical Heritage portfolio revaluation
  4. Stock of own-account eligible assets (including assets used as collateral and excluding eligible assets received as collateral) and cash and deposits with Central Banks

34

Contents

ISP Is Successfully Managing a Challenging Environment

1H20: An Excellent First Half

Combination with UBI Banca

Final Remarks

35

The Results of the Public Exchange Offer on UBI Banca Shares Confirm the Complete Success of the Deal

    • 1,031,958,027 ordinary shares of UBI Banca have been exchanged, equal to ~90.20% of the
      UBI Banca shares subject to the Offer and ~90.18% of the UBI Banca's share capital
    • ISP currently holds a participation of ~91.01% in UBI Banca share capital
    • For UBI Banca shares tendered in acceptance of the Offer, ISP will pay the following Consideration:
      • Consideration in shares: a total of 1,754,328,645 newly-issuedISP ordinary shares, equivalent to ~9.1% of ISP share capital following the Capital Increase (on a fully diluted basis)
      • Cash Consideration: equal to an aggregated sum of ~€588m (€0.57 per share)
    • ISP has exceeded the threshold of 66.67% of UBI Banca's total share capital, allowing it to:
      • Hold control of the Extraordinary General Meeting of UBI Banca
      • Launch and complete the merger process to incorporate UBI Banca into ISP, which will enable reaching all the strategic targets of the combination and the full estimated value creation through the generation of pre-taxannual synergies of ~€700m, once fully completed
      • Expedite the transfer of branches to BPER Banca as soon as possible
      • Use the ~€2.8bn(1) negative goodwill to cover integration charges and to accelerate NPL reduction
  2. Based on ISP share price as of 31.7.20. Net of the impact from the agreement with BPER Banca to sell a portion of branches and related assets and liabilities to pre-emptively address Antitrust issues. The effective determination of the negative goodwill will result from the outcome of the Purchase Price Allocation procedure envisaged by accounting principle IFRS3

36

The Combined Entity Will Have About €1.1 Trillion in Customer Financial Assets

As is(1)

As is

2019YE - P&L (€ bn)

Operating income

18.2

3.6

Operating costs

(9.4)

(2.2)(3)

2019YE - Asset Quality (€ bn)

Loans to customers

395.2

84.8

Net NPL(4)

14.2

4.2

Gross NPL ratio

7.6%

7.8%

NPL Coverage

54.6%

39.0%

2019YE - Customer Financial Assets (€ bn)

Customer financial assets(5)

960.8

196.9

- of which direct deposits from banking business

425.5

95.4

- of which indirect customer deposits

534.5

101.5

- of which AuM(6)

358.1

73.1

Combined Entity after disposal of branches according to Antitrust agreement(2), pre-synergies and Asset Quality actions

~21

~(11)

453.4

17.3 57.2%

including

7.7% ~€1.8bn additional

52.4% provisions

1,092.8

490.8

601.2

406.0

Figures may not add up exactly due to rounding

  1. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition
  2. Preliminary estimates
  3. Excluding Levies and other charges concerning the banking industry
  4. Bad Loans, Unlikely to Pay and Past Due
  5. Excluding double counting between Direct customer deposits and Indirect customer deposits

(6) AuM values computed including Bancassurance

37

Creation of a National Champion, with a Strong Footprint in the Country's Wealthiest Regions…

<5%

5% - 10%

10% - 15%

15% - 20%

>20%

ISP before the combination with UBI Banca

ISP after the combination with UBI Banca

Market share of branches (%)

6%

25%

14%

16%

20%

16%

10%

12%

# of branches:

16%

13%

~3,540

20%

13%

Market share of branches (%)

6%

26%

21%

17%

22%

22%

12%

16%

20% 29%

24%

21%

+

Net of banking branch disposal

# of branches:

~4,610

13%

9%

21% 18%

14%

16%

18%

14%

14%

25%

23%

22%

17%

25%

12%

12%

Note: preliminary estimates

Source: Bank of Italy, March 2020

38

… Strong Market Share Across Products…

Market share, estimate, %

Loans(1)

# 1

~5

~20

~17

~(2)

ISP

UBI

BPER Banca

Combined

Banca

agreement(3)

Entity

# Ranking in Italy

Deposits(2)

# 1

~5

~22

~19

~(2)

ISP

UBI

BPER Banca

Combined

Banca

agreement(3)

Entity

Asset Management(4)

# 1

~22

~3

~24

~(1)

ISP

UBI

BPER Banca

Combined

Banca

agreement(3)

Entity

Life Insurance(5)

# 1

~4

~18

~15

~(1)

ISP

UBI

BPER Banca

Combined

Banca

agreement(3)

Entity

  1. June 2020 data for ISP, March 2020 data for UBI Banca
  2. Including bonds; June 2020 data for ISP, March 2020 data for UBI Banca
  3. Preliminary estimates
  4. Mutual funds; March 2020 data
  5. Based on FY19 premiums as reported by ANIA (the Italian National Association of Insurance Companies)

39

  • and a Comparable Size to the Top European Banking Groups in Terms of Market Cap, Volumes and Operating Income

Main European Banks

Main European Banks

Main European Banks

Ranking by Market Cap (31.7.20)

Ranking by Total Assets (2019)

Ranking by Operating income (1Q20)

Eurozone Ranking

#

HSBC

BNP Paribas

43

UBS

38

Intesa Sanpaolo + UBI(1)

34

Santander

30

Intesa Sanpaolo

30

Nordea

27

C. Agricole SA

23

ING

23

Credit Suisse

22

Lloyds Bkg Gr.

21

KBC

20

Barclays

19

S. Ens. Banken

18

BBVA

18

UniCredit

17

Svenska Handelsbanken

16

Deutsche Bank

16

€ bn

Eurozone Ranking

#

€ bn

Eurozone Ranking

#

77

HSBC

2,418

HSBC

#1

BNP Paribas

2,165

#1

Santander

C. Agricole Group

2,011

#2

BNP Paribas

#2

Santander

1,523

#3

UBS

#2

Soc. Générale

1,356

#4

Barclays

#3

Barclays

1,347

BBVA

#4

BPCE

1,338

#5

Deutsche Bank

#5

Deutsche Bank

1,298

#6

BPCE

#6

Lloyds Banking Group

985

(2)

Intesa Sanpaolo Pro-forma

Crédit Mutuel

931

#7

C. Agricole SA

(2)

913

Intesa Sanpaolo Pro-forma

#8

Soc. Générale

#7

ING

892

#8

Intesa Sanpaolo

UBS

866

Credit Suisse

UniCredit

856

#9

Lloyds Banking Group

#8

RBS

854

ING

#9

Intesa Sanpaolo

816

#10

UniCredit

Credit Suisse

726

Standard Chartered

#10

BBVA

699

Nordea

€ bn

12.9

11.8

#1

11.0

#2

7.5

7.1

6.5

#3

6.1

#4

5.6

#5

5.6

#6

5.3

#6

5.2

#7

4.9

#8

4.9

4.7

4.5

#9

4.4

#10

4.0

2.0

A national champion competing successfully at the European level

  1. Computed as sum of ISP Market Cap + UBI Banca Market Cap as of 31.7.20. Source: Bloomberg
  2. ISP + UBI Banca (net of the agreement with the Antitrust Authority to sell a portion of branches and related assets and liabilities)

40

The New Group Resulting from the Combination with UBI Banca Will be

Able to Offer an Attractive Value Proposition to All its Stakeholders…

European leader with a resilient and diversified business model

Significant synergy generation (~€700m annually pre-tax)with no social costs and low execution risk

Negative goodwill of ~€2.8bn(1) arising from the transaction fully covers integration costs (~€1.3bn pre-tax, ~€0.9bn net of tax) and additional Loan loss provisions to accelerate NPL deleveraging (~€1.8bn pre-tax, ~€1.2bn net of tax)

Accelerating NPL reduction, at no cost to shareholders: in 2021, expected ~€4bn UBI Banca gross NPL disposal

on highly provisioned positions

Payout ratio of 75% in 2020(2) and 70% in 2021

Maintain a solid capital position (minimum Common Equity(3) ratio of 13%(4), even taking into account the potential

cash distribution from reserves in light of the 2019 Net income allocated to reserves, subject to ECB approval(4))

Net income expected not lower than ~€5bn starting in 2022

Beyond 2021, rewarding shareholders while maintaining solid capital position

  1. Based on ISP share price as of 31.7.20. Net of the impact from the agreement with BPER Banca to sell a portion of branches and related assets and liabilities to pre-emptively address Antitrust issues. The effective determination of the negative goodwill will result from the outcome of the Purchase Price Allocation procedure envisaged by accounting principle IFRS3
  2. Excluding Net income generated by the negative goodwill not allocated to integration costs and accelerated NPL deleveraging
  3. Pro-formafully loaded Basel 3 (considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks and the expected absorption of DTA on losses carried forward). CET1 ratio fully phased in >12.0%
  4. After 1.1.21

41

  • with Particular Attention to the Territory and Communities,
    Customers and People of the UBI Banca Group

Territory and Communities

Customers

People

Creation of Consigli del Territorio: local oversight committees to coordinate initiatives, formed by bank

representatives and prominent community leaders

Creation of a center of excellence in Pavia for agriculture and livestock breeding coordinating all Group activities in this sector

UBI Banca brand enhancement in reference territories if customer surveys rank UBI Banca brand above ISP's

Stipulation of agreements to benefit local communities: real estate and artistic heritage, donations to the

territory, innovation and scientific research, welfare, social housing, healthcare...

Full involvement of UBI Banca's territorial Foundations in ISP's initiatives to support local communities, and

enhancement of their role in ISP's social and cultural actions

Creation of a leading Impact Bank, with a new unit based in Brescia, Bergamo and Cuneo (UBI Banca's

envisaged standalone initiatives in Sustainability and social support for the territory will be doubled)

Additional €10bn in lending per year in the three-year 2021-2023period, with no reduction in credit granted to mutual customers

Creation of 4 new regional Departments in Bergamo, Brescia, Cuneo and Bari, each with its own network of around 300-400branches with high lending capacity and managerial autonomy: credit faculty up to €50 million for each regional Department manager, with autonomy in spending and personnel resource management

Hiring of 2,500 young people (one young person for every two voluntary exits) with more than half in the

territories of Bergamo, Brescia, Pavia, Cuneo and southern Italy

Enhancement of UBI Banca personnel across various Divisions and Governance areas. For example: the Heads

of the new regional Departments (Bergamo, Brescia, Cuneo and Bari) and of the centre of excellence for

agriculture (Pavia) will be appointed from among UBI Banca People; the people of UBI Banca to remain in

their territories without any social impact

Talent development program will include ~300 people from UBI Banca (~100 more than UBI Banca standalone)

42

ISP Fully Respected the Timing to Complete the Exchange Offer and Has Already Planned the Next Steps for the Integration of UBI Banca

NOT EXHAUSTIVE

Delivered

17 February 2020

ISP's Notice pursuant to Art. 102

✓

25 June 2020

Approval of the Exchange Offer Document by CONSOB

✓

6 - 30 July

Exchange Offer period

✓

5 August

Settlement of the Exchange Offer

✓

By mid-October

Designation of a new Board of Directors for UBI Banca

2020

By December

Disposal of branches and related assets and liabilities

2020

to BPER Banca

By December

Additional Loan loss provisions to accelerate NPL deleveraging

2020

By December

Signing of the agreement with trade unions for the voluntary exits,

Next Steps

2020

with no social impact

By April

Merger of UBI Banca into ISP and completion of IT integration

2021

By December

Completion of integration of the two Groups and - where possible -

2021

integration of UBI Banca's Product Companies

By December

UBI Banca gross NPL disposal on highly provisioned positions

2021

New Business Plan by the end of 2021, as soon as the

macroeconomic scenario becomes clearer

43

Contents

ISP Is Successfully Managing a Challenging Environment

1H20: An Excellent First Half

Combination with UBI Banca

Final Remarks

44

ISP Is Fully Equipped to Succeed in this Challenging Environment

ISP is fully equipped for this challenging environment:

  • Best-in-classexcess capital, low leverage and strong liquidity
  • ~€880m in additional provisions already booked in 1H20 to tackle future COVID-19 impacts
  • Low NPL stock, with robust coverage at 53.1%
  • Well-diversifiedand resilient business model
  • High strategic flexibility in managing costs, with Cost/Income ratio at 48.5%

ISP has delivered an excellent H1:

  • Highest H1 Net income since 2008 (86% of the ~€3bn minimum Net income target for 2020 already achieved)
  • Best-everQ2 Net income
  • Growth in Operating margin, thanks to stable revenues and cost reduction
  • Lowest-everH1 and Q2 Gross NPL inflow
  • Continue delivering best-in-class profitability with:
    • Minimum ~€3bn Net income in 2020 assuming cost of risk of ~90bps, without considering the combination with UBI Banca
    • Minimum ~€3.5bn Net income in 2021 assuming cost of risk of ~70bps, without considering the combination with UBI Banca
  • Maintain a solid capital position (minimum Common Equity(1) ratio of 13%(2), even taking into account the potential cash distribution from reserves in light of the 2019 Net income allocated to reserves, subject to ECB approval(2))
  • Deliver payout ratio of 75% in 2020 and 70% in 2021(3)
  • On top of the cash dividend from 2020 Net income, ISP intends to get ECB approval for a cash distribution to shareholders from reserves in 2021 in light of the 2019 Net income allocated to reserves in 2020

The combination with UBI Banca adds significant value by improving asset quality and

delivering synergies with no social costs and very low execution risk due to ISP's proven track

record in managing integrations in Italy

  1. Pro-formafully loaded Basel 3 (considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks and the expected absorption of DTA on losses carried forward). CET1 ratio fully phased in >12%
  2. After 1.1.21
  3. Without considering the combination with UBI Banca. The same payout ratios apply when considering the combination with UBI Banca, excluding from 2020 Net income the portion generated by the

negative goodwill not allocated to integration costs and accelerated NPL deleveraging

45

1H20 Results

Detailed Information

MIL-BVA327-15051trim.13-90141/LR

Key P&L and Balance Sheet Figures

€ m

Operating income

Operating costs

Cost/Income ratio

Operating margin

Gross income (loss)

Net income

1H20

9,075

(4,403)

48.5%

4,672

3,859

2,566

Loans to Customers

Customer Financial Assets(1)

of which Direct Deposits from Banking Business

of which Direct Deposits from Insurance Business and Technical Reserves

of which Indirect Customer Deposits

  • Assets under Management
  • Assets under Administration

RWA

30.6.20

403,337

962,413

437,806

163,903

523,454

350,689

172,765

295,973

Note: figures may not add up exactly due to rounding

(1) Net of duplications between Direct Deposits and Indirect Customer Deposits

47

Contents

Detailed Consolidated P&L Results

Liquidity, Funding and Capital Base

Asset Quality

Divisional Results and Other Information

48

MIL-BVA327-15051trim.13-90141/LR

1H20 vs 1H19: €2.6bn Net Income, Best H1 Result since 2008

€ m

1H19

1H20

%

pro-forma(1)

Net interest income

3,517

3,497

(0.6)

Net fee and commission income

3,830

3,588

(6.3)

Income from insurance business

627

736

17.4

Profits on financial assets and liabilities at fair value

1,092

1,257

15.1

Other operating income (expenses)

9

(3)

n.m.

Operating income

9,075

9,075

0.0

Personnel expenses

(2,807)

(2,736)

(2.5)

Other administrative expenses

(1,212)

(1,136)

(6.3)

Adjustments to property, equipment and intangible assets

(512)

(531)

3.7

Operating costs

(4,531)

(4,403)

(2.8)

Operating margin

4,544

4,672

2.8

Net adjustments to loans

(923)

(1,801)(2)

95.1

Net provisions and net impairment losses on other assets

(67)

(157)

134.3

Other income (expenses)

7

(18)

n.m.

Income (Loss) from discontinued operations

41

1,163

n.m.

Gross income (loss)

3,602

3,859

7.1

Taxes on income

(981)

(874)

(10.9)

Charges (net of tax) for integration and exit incentives

(52)

(50)

(3.8)

Effect of purchase price allocation (net of tax)

(68)

(50)

(26.5)

Levies and other charges concerning the banking industry (net of tax)

(242)

(277)(3)

14.5

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

7

(42)

n.m.

Net income

2,266

2,566

13.2

(0.4)% excluding ~€880m in provisions for future

COVID-19 impacts

Note: figures may not add up exactly due to rounding

(1) Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition

(2) Including ~€880m in provisions for future COVID-19 impacts

(3) €394m pre-tax of which charges for the Resolution Fund: €254m pre-tax (€175m net of tax), our commitment for the year fully funded, and €86m pre-tax (€58m net of tax) for the additional contribution to the National

Resolution Fund

49

Q2 vs Q1: €1.4bn Net Income, Best Q2 Ever

€ m

1Q20

2Q20

Δ%

pro-forma(1)

Net interest income

1,747

1,750

0.2

Net fee and commission income

1,844

1,744

(5.4)

Income from insurance business

369

367

(0.5)

Profits on financial assets and liabilities at fair value

994

263

(73.5)

Other operating income (expenses)

(15)

12

n.m.

Operating income

4,939

4,136

(16.3)

Personnel expenses

(1,356)

(1,380)

1.8

Other administrative expenses

(553)

(583)

5.4

Adjustments to property, equipment and intangible assets

(264)

(267)

1.1

Operating costs

(2,173)

(2,230)

2.6

Operating margin

2,766

1,906

(31.1)

Net adjustments to loans

(403)

(1,398)(2)

246.9

Net provisions and net impairment losses on other assets

(419)

262(3)

n.m.

Other income (expenses)

3

(21)

n.m.

Income (Loss) from discontinued operations

29

1,134

n.m.

Gross income (loss)

1,976

1,883

(4.7)

Taxes on income

(561)

(313)

(44.2)

Charges (net of tax) for integration and exit incentives

(15)

(35)

133.3

Effect of purchase price allocation (net of tax)

(26)

(24)

(7.7)

Levies and other charges concerning the banking industry (net of tax)

(191)

(86)(4)

(55.0)

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

(32)

(10)

(68.8)

Net income

1,151

1,415

22.9

Note: figures may not add up exactly due to rounding

  1. Data restated to take into account the effects of the RBM Assicurazione Salute acquisition
  2. Including ~€880m in provisions for future COVID-19 impacts
  3. Including the write-back of ~€300m in provisions for future COVID-19 impacts booked in 1Q20
  4. €121m pre-tax of which €86m pre-tax (€58m net of tax) for the additional contribution to the National Resolution Fund

50

MIL-BVA327-15051trim.13-90141/LR

+28.0% excluding

~€880m in provisions for future COVID-19 impacts

Net Interest Income: Slight Quarterly Increase Despite All-Time Low Interest Rates

Quarterly Analysis

Yearly Analysis

€ m

Euribor 1M; % € m

Euribor 1M; %

%

2Q20 vs 2Q19 and 1Q20

%

1H20 vs 1H19

3,517

3,497

1,761

1,747

1,750

-0.37

-0.47

-0.46

-0.37

-0.47

2Q19

1Q20

2Q20

1H19

1H20

pro-forma

pro-forma

(0.6)

+0.2

(0.6)

  • Slight increase vs Q1 despite continued all-time low interest rates
  • 3.6% growth in average Direct deposits from banking business vs Q1 (+4.0% vs 2Q19)
  • 2.5% growth in average Performing loans to customers vs Q1 (+6.5% vs 2Q19)
  • Decrease due to decline in market rates, NPL stock reduction and lower contribution from core deposit hedging
  • 3.7% growth in average Direct deposits from banking business
  • 4.9% growth in average Performing loans to customers

51

Net Interest Income: Slight Increase vs Q1 Mainly Due to the Growth in Volumes

Quarterly Analysis

€ m

1,747

21

2

1,750

(15)

(5)

Commercial

component

1Q20

Volumes Spread

Hedging(1)

Financial

2Q20

components

Yearly Analysis

€ m

+€75m excluding NPL

stock reduction impact

3,517

99

31

3,497

(125)

(25)

Commercial

component

1H19

Volumes Spread

Hedging(1)

Financial

1H20

pro-forma

components

Note: figures may not add up exactly due to rounding

(1) ~€80m benefit from hedging on core deposits in 1H20, of which ~€38m in 2Q20

52

Net Fee and Commission Income: Impacted by the Lockdown and Market Volatility

Quarterly Analysis

Yearly Analysis

€ m

%

2Q20 vs 2Q19 and 1Q20 € m

%

1H20 vs 1H19

3,830 3,588

1,965 1,844 1,744

2Q19 1Q20 2Q20

pro-forma

(11.2) (5.4)

  • 2Q20 impacted by two months of countrywide lockdown
  • Strong recovery in June, the best month in H1

1H19 1H20

pro-forma

(6.3)

  • 1H20 impacted by three months of countrywide lockdown and market volatility
  • Commissions from Commercial banking activities down 8.1% (-€91m)
  • Commissions from Management, dealing and consultancy activities down 3.6% (-€83m)

53

Profits on Financial Assets and Liabilities at Fair Value: Best Half- Year Result Ever

Quarterly Analysis

Yearly Analysis

€ m

%

2Q20 vs 2Q19 and 1Q20 € m

%

1H20 vs 1H19

994

1,092

1,257

634

263

2Q19

1Q20

2Q20

1H19

1H20

pro-forma

pro-forma

(58.5)

(73.5)

+15.1

Contributions by Activity

2Q19

1Q20

2Q20

1H19

1H20

pro-forma

pro-forma

Customers

136

148

94

278

242

Capital markets

65

405

(85)

147

320

Trading and Treasury

427

480

242

644

722

Structured credit products

7

(38)

12

23

(26)

Note: figures may not add up exactly due to rounding

54

Operating Costs: Further Significant Yearly Reduction whileMIL-BVA327-15051trim.13-90141/LRInvesting for Growth

Quarterly Analysis

Yearly Analysis

  • 2Q20 vs 2Q19 and 1Q20

Operating Costs

Personnel Expenses

€ m

€ m

2,296 2,173 2,230

1,419 1,356 1,380

2Q19

1Q20

2Q20

2Q19

1Q20

2Q20

pro-formapro-forma

pro-formapro-forma

(2.9

2 6

x x)

+x.x

(2.7)

+1.8

Other Administrative Expenses

Adjustments

€ m

€ m

625

553

583

252

264

267

2Q19

1Q20

2Q20

2Q19

1Q20

2Q20

pro-formapro-forma

pro-formapro-forma

(6.7)

+5.4

+6.0

+1.1

  • 1H20 vs 1H19

Operating Costs

Personnel Expenses

€ m

4,531

4,403

€ m

2,807 2,736

1H19

1H20

1H19

1H20

pro-forma

pro-forma

(2.8)

(2.5)

Other Administrative Expenses

Adjustments

€ m

€ m

1,212

1,136

512

531

1H19

1H20

1H19

1H20

pro-forma

pro-forma

(6.3)

+3.7

  • 2.9% reduction in Operating costs vs 2Q19
  • Other administrative expenses down 6.7% vs 2Q19, and up vs 1Q20 mainly due to seasonal effects and COVID-19 related costs
  • 189 headcount reduction in Q2
  • Lowest-everOther administrative expenses (-6.3%)
  • Increase in Adjustments due to investments to trigger growth
  • Cost/Income ratio down to 48.5% (vs 51.8% in FY19 pro-forma)
  • 2,935 headcount reduction

55

Net Adjustments to Loans: Yearly Decline when Excluding Provisions for Future COVID-19 Impacts

Quarterly Analysis

€ m

% 2Q20 vs 2Q19 and 1Q20 € m

~€880m due to provisions for future COVID-19 impacts

1,398

554 403

Yearly Analysis

% 1H20 vs 1H19

~€880m due to provisions for

future COVID-19 impacts

1,801

923

2Q19

1Q20

2Q20

1H19

1H20

pro-forma

pro-forma

n.m. +246.9

  • Nineteenth consecutive quarterly reduction in gross NPL stock, at no cost to shareholders
  • Lowest-everQ2 gross NPL inflow(1)
  • €0.5bn(1) gross NPL deleveraging in Q2

+95.1

  • Down 0.4% when excluding provisions for future COVID-19 impacts
  • Annualised cost of credit down to 46bps (vs 53bps in FY19) when excluding provisions for future COVID-19 impacts
  • Lowest-everH1 NPL inflow(1)
  • €5.9bn(1) gross NPL deleveraging on a yearly basis
    (€35.6bn(1) since the peak of 30.9.15 of which €1.8bn(1) in 1H20)

(1) Excluding the impact from the adoption of the new Definition of Default (DoD) since November 2019

56

Contents

Detailed Consolidated P&L Results

Liquidity, Funding and Capital Base

Asset Quality

Divisional Results and Other Information

57

Strong Growth in Customer Financial Assets in Q2

  • 30.6.20 vs 30.6.19, 31.12.19 e 31.3.20

Customer Financial Assets(1)

Direct Deposits from Banking Business

€ bn

€ bn

939

961

920

962

423

426

434

438

30.6.19

31.12.19

31.3.20

30.6.20

30.6.19

31.12.19

31.3.20

30.6.20

+2.5

+0.2

+4.6

+3.5

+2.9

+1.0

Direct Deposits from Insurance Business and

Indirect Customer Deposits

Technical Reserves

€ bn

€ bn

Assets under adm. Assets under mgt.

515

534

485

523

158

166

157

164

171

176

152

173

358

344

334

351

30.6.19

31.12.19

31.3.20

30.6.20

30.6.19

31.12.19

31.3.20

30.6.20

+4.0

(1.2)

+4.7

+1.6

(2.1)

+7.9

◼ €17.1bn increase in AuM in Q2

Note: figures may not add up exactly due to rounding

58

(1) Net of duplications between Direct Deposits and Indirect Customer Deposits

MIL-BVA327-15051trim.13-90141/LR

Mutual Funds Mix

Mutual funds mix

%

100

100

100

100

Fixed income,

57%

46%

49%

48%

monetary and

other funds

+9pp

Equity,

54%

51%

52%

balanced

43%

and flexible

funds

31.12.13

31.12.19

31.3.20

30.6.20

59

MIL-BVA327-15051trim.13-90141/LR

Funding Mix

Breakdown of Direct Deposits from Banking Business

€ bn; 30.6.20

% Percentage of total

438

356

81

Wholesale RetailTotal

19

81

100

  • Current accounts and deposits
  • Repos and securities lending
  • Senior bonds
  • Covered bonds
  • Short-terminstitutional funding
  • Subordinated liabilities
  • Other deposits

Wholesale Retail

9327

3-

358(1)

12-

11(2)-

8

Placed with

3

Private Banking

clients

318(3)

Retail funding represents 81% of Direct deposits from banking business

Note: figures may not add up exactly due to rounding

  1. 38% placed with Private Banking clients
  2. Certificates of deposit + Commercial papers

(3) Including Certificates

60

Strong Funding Capability: Broad Access to International Markets

2020-2022 MLT Maturities

€ bn

Wholesale

Retail

ISP Main Wholesale Issues

2019

12

9

9

7

3

2

3

2

1

2H20

FY21

FY22

  • €1bn covered bonds, JPY13.2bn (~€105m) senior unsecured, €3.5bn senior unsecured, CHF250m senior unsecured, $2bn senior unsecured and €750m green bond placed. On average 94% demand from foreign investors; orderbooks average oversubscription ~2.4x
    • February: €1bn covered bonds backed by residential mortgages
    • March: second senior unsecured Tokyo Pro-Bond transaction for a total of JPY13.2bn (~€105m) split between 3y and 15y tranches
    • June: €2.25bn dual tranche 5/10y senior unsecured issue
    • September: inaugural CHF250m 5y senior unsecured issue and $2bn triple-tranche senior unsecured issue split between $750m 5y, $750m 10y and $500m 30y
    • November: €1.25bn 7y senior unsecured issue and €750m 5y senior unsecured green bond focused on the Circular Economy, under the ISP Sustainability Bond Framework

2020

  • GBP350m senior unsecured, €1.5bn AT1 and €1.25bn senior unsecured placed. On average 80% demand from foreign investors; orderbooks average oversubscription ~3.2x
    • January: GBP350m 10y senior unsecured issue, first GBP transaction by an Italian bank since 2010
    • February: €1.5bn dual-tranche 5/10y Additional Tier 1 issue, first ever dual-tranche AT1 in the Euro market
    • May: €1.25bn 5y senior unsecured issue, first Italian bank transaction since the COVID-19 outbreak

Note: figures may not add up exactly due to rounding

61

High Liquidity: More than €220bn in Liquid Assets with LCR and

NSFR Well Above Regulatory Requirements

Liquid assets(1)

Unencumbered eligible assets with Central

Banks(2) (net of haircuts)

  • bn

221

191 199

  • bn

110

127

96

30.6.19

31.3.20

30.6.20

30.6.19

31.3.20

30.6.20

  • Refinancing operations with the ECB: €70.9bn(3)
  • Loan to Deposit ratio(4) at 92%
  1. Stock of own-account eligible assets (including assets used as collateral and excluding eligible assets received as collateral) and cash & deposits with Central Banks
  2. Eligible assets freely available (excluding assets used as collateral and including eligible assets received as collateral) and cash & deposits with Central Banks
  3. Consisting entirely of TLTRO III, out of a maximum allowance of €90.2bn
  4. Loans to Customers/Direct Deposits from Banking Business

62

Solid and Increased Capital Base

Phased-in Common Equity Ratio

Phased-in Tier 1 Ratio

Phased-in Total Capital Ratio

%

%

%

16.1

16.5

18.5

19.2

13.6

14.2

14.6

15.3

17.6

30.6.19

31.3.20(1)

30.6.20(1)

30.6.19

31.3.20(1)

30.6.20(1)

30.6.19

31.3.20(1)

30.6.20(1)

◼ 14.9% pro-forma fully loaded Common Equity ratio(2) ◼ 6.6% leverage ratio

(1) Considering the impact from IFRS9 FTA phasing-in (~20bps in 1Q20) and after the deduction of accrued dividends, assumed equal to 75% of the Net income for the period, and coupons accrued on the Additional Tier 1 issues

(2) Pro-forma fully loaded Basel 3 (30.6.20 financial statements considering the total absorption of DTA related to IFRS9 FTA, goodwill realignment/adjustments to loans/non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of the operations of the two former Venetian banks, the expected absorption of DTA on losses carried forward and the expected distribution of

1H20 Net income of insurance companies)

63

Contents

Detailed Consolidated P&L Results

Liquidity, Funding and Capital Base

Asset Quality

Divisional Results and Other Information

64

MIL-BVA327-15051trim.13-90141/LR

Non-performing Loans: Sizeable Coverage

Cash coverage; %

Total NPL(1)

54.4% excluding DoD(2) impact

54.1

53.6

53.1

30.6.19 31.3.2030.6.20

Bad Loans

Unlikely to Pay

Past Due

65.9

64.4

63.6

33.4% excluding DoD(2) impact

37.2

38.7

40.2

25.1

15.9

17.0

30.6.19

31.3.20

30.6.20

30.6.19

31.3.20

30.6.20

30.6.19

31.3.20

30.6.20

  1. Bad Loans (Sofferenze), Unlikely to pay (Inadempienze probabili) and Past Due (Scaduti e sconfinanti)
  2. New Definition of Default applied since November 2019

65

Non-performing Loans: Lowest-ever H1 Inflows

Gross inflow of new NPL(1) from Performing Loans

€ bn

Impact from the

8.5acquisition of the two former Venetian banks

7.0

6.3

-81%

4.6

3.0

2.2

2.4

1.9

1.6

(2)

(3)

1H12

1H13

1H14

1H15

1H16

1H17

1H18

1H19

1H20

Net inflow of new NPL(1) from Performing Loans

€ bn

6.2

Impact from the

acquisition of the two

former Venetian banks

4.5

4.1

-81%

3.0

2.0

1.2

1.4

1.3

1.1

(2)

(3)

1H12

1H13

1H14

1H15

1H16

1H17

1H18

1H19

1H20

  1. Bad Loans (Sofferenze), Unlikely to pay (Inadempienze probabili) and Past Due (Scaduti e sconfinanti)
  2. 2012 figures recalculated to take into consideration the regulatory changes to Past Due classification criteria introduced by the Bank of Italy (90 days since 2012 vs 180 days up until 31.12.11)
  3. Excluding ~€0.3bn impact from the adoption of the new Definition of Default (DoD) since November 2019

66

MIL-BVA327-15051trim.13-90141/LR

Non-performing Loans: Lowest-ever Q2 Gross Inflow

€ m

Gross inflow of new NPL(1) from Performing Loans

1,073

771

816

-24%

2Q19

1Q20(2)

2Q20(3)

Bad LoansUnlikely to Pay

594

365

296

9

12

4

2Q19

1Q20

2Q20

2Q19

1Q20(4)

2Q20(5)

Note: figures may not add up exactly due to rounding

(1)

Bad Loans (Sofferenze), Unlikely to pay (Inadempienze probabili) and Past Due (Scaduti e sconfinanti)

(2)

Excluding €129m impact from the adoption of the new Definition of Default (DoD) since November 2019

(3)

Excluding €183m impact from the adoption of the new Definition of Default (DoD) since November 2019

(4)

Excluding €16m impact from the adoption of the new Definition of Default (DoD) since November 2019

(5)

Excluding €5m impact from the adoption of the new Definition of Default (DoD) since November 2019

(6)

Excluding €113m impact from the adoption of the new Definition of Default (DoD) since November 2019

(7)

Excluding €178m impact from the adoption of the new Definition of Default (DoD) since November 2019

67

Past Due

470 394 516

2Q19 1Q20(6) 2Q20(7)

MIL-BVA327-15051trim.13-90141/LR

Non-performing Loans: Strong Decrease in Net Inflow vs 2Q19

€ m

Net inflow of new NPL(1) from Performing Loans

701

643

-8%

502

2Q191Q20(2)2Q20(3)

Bad LoansUnlikely to Pay

322

173

197

2

3

(3)

2Q19

1Q20(4)

2Q20(5)

2Q19

1Q20

2Q20

Note: figures may not add up exactly due to rounding

(1)

Bad Loans (Sofferenze), Unlikely to pay (Inadempienze probabili) and Past Due (Scaduti e sconfinanti)

(2)

Excluding €129m impact from the adoption of the new Definition of Default (DoD) since November 2019

(3)

Excluding €183m impact from the adoption of the new Definition of Default (DoD) since November 2019

(4)

Excluding €16m impact from the adoption of the new Definition of Default (DoD) since November 2019

(5)

Excluding €5m impact from the adoption of the new Definition of Default (DoD) since November 2019

(6)

Excluding €113m impact from the adoption of the new Definition of Default (DoD) since November 2019

(7)

Excluding €178m impact from the adoption of the new Definition of Default (DoD) since November 2019

68

Past Due

377 332 443

2Q19 1Q20(6) 2Q20(7)

MIL-BVA327-15051trim.13-90141/LR

New Bad Loans: Strong Decrease in Gross Inflow

  • bn

Group's new Bad Loans(1) gross inflow

BdT

IMI C&IB

0.6

International

Subsidiary Banks

0.1

0.3

0.2

0.5

0.3

0.1

0.1

2Q19

1Q20

2Q20

BdT's new Bad Loans(1) gross inflow

IMI C&IB's new Bad Loans(1) gross inflow

2Q19

1Q20

2Q20

2Q19

1Q20

2Q20

Total

0.5

0.3

0.1

Total

0.1

-

-

Households

0.1

0.1

-

Banca IMI(2)

-

-

-

SMEs

0.4

0.2

0.1

Global Corporate

0.1

-

-

International

-

-

-

Financial Institutions

-

-

-

Note: figures may not add up exactly due to rounding

  1. Sofferenze
  2. Capital Markets and Investment Banking; merger by incorporation of Banca IMI into Intesa Sanpaolo from July 20th, 2020

69

MIL-BVA327-15051trim.13-90141/LR

New Unlikely to Pay: Decrease in Gross Inflow vs 2Q19

  • bn

Group's gross inflow of new Unlikely to Pay

0.9

BdT

IMI C&IB

0.1

0.7

0.1

0.7

International

0.1

Subsidiary Banks

0.8

0.1

0.7

0.6

2Q19

1Q20

2Q20

BdT's gross inflow of new Unlikely to Pay

IMI C&IB's gross inflow of new Unlikely to Pay

2Q19

1Q20

2Q20

2Q19

1Q20

1Q20

Total

0.8

0.7

0.6

Total

0.1

-

-

Households

0.2

0.3

0.3

Banca IMI(1)

-

-

-

SMEs

0.5

0.4

0.3

Global Corporate

0.1

-

-

International

-

-

-

Financial Institutions

-

-

-

Note: figures may not add up exactly due to rounding

(1) Capital Markets and Investment Banking; merger by incorporation of Banca IMI into Intesa Sanpaolo from July 20th, 2020

70

Non-performing Loans: Nineteenth Consecutive Quarterly Decline in Gross Stock

  • bn

Bad Loans

- of which forborne

Unlikely to pay

- of which forborne

Gross NPL

Net NPL

  • bn

30.6.19 31.3.20 30.6.2030.6.19 31.3.20 30.6.20

20.7

18.4

17.6

Bad Loans

7.1

6.6

6.4

2.7

2.4

2.3

- of which forborne

1.0

1.0

1.0

13.6

10.8

11.1

Unlikely to pay

8.6

6.6

6.6

6.0

4.2

4.3

- of which forborne

4.0

2.8

2.8

€0.3bn excluding DoD(1)

€0.3bn excluding DoD(1)

€0.2bn excluding DoD(1)

€0.2bn excluding DoD(1)

Past Due

0.5

1.0

1.2

Past Due

0.4

0.8

1.0

- of which forborne

-

0.1

0.1

- of which forborne

-

0.1

0.1

€29.4bn excluding DoD(1)

€28.9bn excluding DoD(1)

€13.3bn excluding DoD(1)

€13.2bn excluding DoD(1)

Total

34.8

30.2

29.9

Total

16.0

14.0

14.0

€35.6bn(1) NPL deleveraging since the peak of 30.9.15 (€5.9bn(1) since 30.6.19, of which

€1.8bn(1) in H1), leading to the lowest NPL stock and NPL ratios since 2008

Note: figures may not add up exactly due to rounding

(1) Excluding the impact from the adoption of the new Definition of Default (DoD) since November 2019

71

MIL-BVA327-15051trim.13-90141/LR

Loans to Customers: A Well-diversified Portfolio

Breakdown by business area

(data as at 30.6.20)

Repos, Capital markets and

Financial Institutions

Global Corporate &

Non-profit

11%

Structured Finance

1%

22%

SMEs 18%

12% International

Network

Consumer 6%

1%

Finance

6%

Other

RE & Construction

23%

Residential Mortgages

  • Low risk profile of residential mortgage portfolio
    • Instalment/available income ratio at 31%
    • Average Loan-to-Value equal to 57%
    • Original average maturity equal to ~23 years
    • Residual average life equal to ~19 years

Note: figures may not add up exactly due to rounding

72

Breakdown by economic business sector

30.6.20

Loans of the Italian banks and companies of the Group

Households

28.6%

Public Administration

1.8%

Financial companies

8.6%

Non-financial companies

33.3%

of which:

SERVICES

7.0%

DISTRIBUTION

5.7%

REAL ESTATE

3.2%

CONSTRUCTION

1.9%

UTILITIES

1.8%

METALS AND METAL PRODUCTS

1.7%

TRANSPORT

1.5%

AGRICULTURE

1.5%

FOOD AND DRINK

1.3%

MECHANICAL

1.1%

TRANSPORTATION MEANS

1.0%

FASHION

1.0%

INTERMEDIATE INDUSTRIAL PRODUCTS

0.9%

ELECTROTECHNICAL AND ELECTRONIC

0.7%

HOLDING AND OTHER

0.4%

BASE AND INTERMEDIATE CHEMICALS

0.3%

MATERIALS FOR CONSTRUCTION

0.3%

INFRASTRUCTURE

0.3%

ENERGY AND EXTRACTION

0.3%

NON-CLASSIFIED UNITS

0.2%

FURNITURE

0.2%

PUBLISHING AND PRINTING

0.2%

PHARMACEUTICAL

0.2%

OTHER CONSUMPTION GOODS

0.2%

MASS CONSUMPTION GOODS

0.1%

WHITE GOODS

0.1%

Rest of the world

12.4%

Loans of international banks and companies of the Group

11.8%

Non-performing loans

3.5%

TOTAL

100.0%

Contents

Detailed Consolidated P&L Results

Liquidity, Funding and Capital Base

Asset Quality

Divisional Results and Other Information

73

MIL-BVA327-15051trim.13-90141/LR

Divisional Financial Highlights

Data as at 30.6.20

Divisions

IMI

International

Corporate

Banca dei

Corporate &

Private

Asset

Insurance(4)

Total

Territori

Investment

Subsidiary

Banking(2)

Management(3)

Centre /

Banking

Banks(1)

Others(5)

Operating Income (€ m)

3,975

2,594

939

955

355

670

(413)

9,075

Operating Margin (€ m)

1,490

2,061

458

664

285

562

(848)

4,672

Net Income (€ m)

58

1,214

245

427

212

327

83

2,566

Cost/Income (%)

62.5

20.5

51.2

30.5

19.7

16.1

n.m.

48.5

RWA (€ bn)

83.0

105.0

32.6

9.5

1.4

0.0

64.6

296.0

Direct Deposits from Banking Business (€ bn)

213.3

85.1

44.1

38.7

0.0

0.0

56.6

437.8

Loans to Customers (€ bn)

201.7

141.6

34.8

9.1

0.2

0.0

15.8

403.3

Note: figures may not add up exactly due to rounding

  1. Excluding the Russian subsidiary Banca Intesa included in IMI C&IB
  2. Fideuram, Intesa Sanpaolo Private Banking, Intesa Sanpaolo Private Bank (Suisse) Morval, and Siref Fiduciaria
  3. Eurizon
  4. Fideuram Vita, Intesa Sanpaolo Assicura, Intesa Sanpaolo Life and Intesa Sanpaolo Vita
  5. Treasury Department, Central Structures and consolidation adjustments

74

MIL-BVA327-15051trim.13-90141/LR

Banca dei Territori: 1H20 vs 1H19

€ m

1H19

1H20

%

pro-forma(1)

Net interest income

2,063

2,060

(0.1)

Net fee and commission income

2,050

1,878

(8.4)

Income from insurance business

1

0

(100.0)

Profits on financial assets and liabilities at fair value

34

39

14.7

Other operating income (expenses)

(2)

(2)

0.0

Operating income

4,146

3,975

(4.1)

Personnel expenses

(1,556)

(1,483)

(4.7)

Other administrative expenses

(1,033)

(1,000)

(3.2)

Adjustments to property, equipment and intangible assets

(4)

(2)

(50.0)

Operating costs

(2,593)

(2,485)

(4.2)

Operating margin

1,553

1,490

(4.1)

Net adjustments to loans

(722)

(1,363)

88.8

Net provisions and net impairment losses on other assets

(22)

(31)

40.9

Other income (expenses)

0

0

n.m.

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

809

96

(88.1)

Taxes on income

(293)

(34)

(88.4)

Charges (net of tax) for integration and exit incentives

(10)

(4)

(60.0)

Effect of purchase price allocation (net of tax)

(1)

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

505

58

(88.5)

1H20 including €585m in provisions for future COVID-19 impacts

Note: figures may not add up exactly due to rounding

  1. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement, the merger of Mediocredito Italiano into ISP, the attribution of the ex Capital Light data and some Operating costs from the Corporate Centre to the pertaining Divisions and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing

75

MIL-BVA327-15051trim.13-90141/LR

Banca dei Territori: Q2 vs Q1

€ m

1Q20

2Q20

%

Net interest income

1,046

1,014

(3.1)

Net fee and commission income

990

887

(10.4)

Income from insurance business

(0)

(0)

76.2

Profits on financial assets and liabilities at fair value

18

21

16.5

Other operating income (expenses)

(0)

(1)

(203.2)

Operating income

2,054

1,921

(6.5)

Personnel expenses

(737)

(745)

1.1

Other administrative expenses

(498)

(502)

0.8

Adjustments to property, equipment and intangible assets

(1)

(1)

3.6

Operating costs

(1,236)

(1,248)

0.9

Operating margin

818

672

(17.8)

Net adjustments to loans

(366)

(997)

172.6

Net provisions and net impairment losses on other assets

(17)

(14)

(16.9)

Other income (expenses)

0

0

n.m.

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

434

(339)

n.m.

Taxes on income

(151)

118

n.m.

Charges (net of tax) for integration and exit incentives

(3)

(2)

(44.8)

Effect of purchase price allocation (net of tax)

0

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

280

(223)

n.m.

Q2 including €585m in provisions for future COVID-19 impacts

Note: figures may not add up exactly due to rounding

(1) Data restated for the attribution of the ex Capital Light data and some Operating costs from the Corporate Centre to the pertaining Divisions and to take into account the effects on Operating costs of the Prelios

agreement related to UTP servicing

76

MIL-BVA327-15051trim.13-90141/LR

IMI Corporate & Investment Banking: 1H20 vs 1H19

€ m

1H19

1H20

%

pro-forma(1)

Net interest income

913

1,031

12.9

Net fee and commission income

456

488

7.0

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

636

1,069

68.1

Other operating income (expenses)

2

6

200.0

Operating income

2,007

2,594

29.2

Personnel expenses

(203)

(203)

0.0

Other administrative expenses

(330)

(315)

(4.5)

Adjustments to property, equipment and intangible assets

(14)

(15)

7.1

Operating costs

(547)

(533)

(2.6)

Operating margin

1,460

2,061

41.2

Net adjustments to loans

(115)

(237)

106.1

Net provisions and net impairment losses on other assets

(11)

2

n.m.

Other income (expenses)

3

0

(100.0)

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

1,337

1,826

36.6

Taxes on income

(434)

(607)

39.9

Charges (net of tax) for integration and exit incentives

(2)

(5)

150.0

Effect of purchase price allocation (net of tax)

0

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

901

1,214

34.7

1H20 including €231m in provisions for future COVID-19 impacts

Note: figures may not add up exactly due to rounding

  1. Data restated for the merger of Mediocredito Italiano into ISP, the attribution of the ex Capital Light data and some Operating costs from the Corporate Centre to the pertaining Divisions and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing

77

MIL-BVA327-15051trim.13-90141/LR

Banca IMI(1): A Significant Contribution to Group Results

1H20 Results

Banca IMI Operating Income(2)

of which: Global Markets

€ m

RWA (€ bn)

€ m

1,303

36

1,512

1,025

236

6

1,303

209

Fixed

Credits

Equity

Brokerage Global

Income and

Markets

Commodity

Global

Investment

Total

+

Markets

Banking &

Banca IMI

of which: Investment Banking & Structured Finance

Structured Finance

€ m

209

23.9

3.9

27.8

◼ ~38% of Operating income is customer driven

149

3

47

10

◼ Cost/Income ratio at 15.3%

Investment

Equity

M&A

Debt

Structured

◼ H1 Net income at €791m

Capital

Advisory

Markets

Finance

Banking &

Markets

Struct.

Finance

Note: figures may not add up exactly due to rounding

  1. Merger by incorporation of Banca IMI into Intesa Sanpaolo from July 20th, 2020
  2. Banca IMI S.p.A. and its subsidiaries

78

MIL-BVA327-15051trim.13-90141/LR

IMI Corporate & Investment Banking: Q2 vs Q1

€ m

1Q202Q20%

Net interest income

497

533

7.2

Net fee and commission income

239

249

4.1

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

897

172

(80.9)

Other operating income (expenses)

(0)

7

n.m.

Operating income

1,633

960

(41.2)

Personnel expenses

(96)

(107)

11.1

Other administrative expenses

(161)

(154)

(4.8)

Adjustments to property, equipment and intangible assets

(8)

(7)

(6.2)

Operating costs

(265)

(268)

0.9

Operating margin

1,368

693

(49.4)

Net adjustments to loans

(4)

(232)

n.m.

Net provisions and net impairment losses on other assets

6

(5)

n.m.

Other income (expenses)

0

0

n.m.

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

1,370

456

(66.7)

Taxes on income

(458)

(149)

(67.4)

Charges (net of tax) for integration and exit incentives

(2)

(3)

69.1

Effect of purchase price allocation (net of tax)

0

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

911

303

(66.7)

Note: figures may not add up exactly due to rounding

79

Q2 including €231m in provisions for future COVID-19 impacts

MIL-BVA327-15051trim.13-90141/LR

International Subsidiary Banks: 1H20 vs 1H19

€ m

1H19

1H20

%

Net interest income

679

653

(3.8)

Net fee and commission income

264

239

(9.5)

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

59

63

6.8

Other operating income (expenses)

(16)

(16)

0.0

Operating income

986

939

(4.8)

Personnel expenses

(263)

(261)

(0.8)

Other administrative expenses

(164)

(166)

1.2

Adjustments to property, equipment and intangible assets

(52)

(54)

3.8

Operating costs

(479)

(481)

0.4

Operating margin

507

458

(9.7)

Net adjustments to loans

(27)

(125)

363.0

Net provisions and net impairment losses on other assets

(4)

0

n.m.

Other income (expenses)

4

6

50.0

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

480

339

(29.4)

Taxes on income

(96)

(76)

(20.8)

Charges (net of tax) for integration and exit incentives

(14)

(18)

28.6

Effect of purchase price allocation (net of tax)

0

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

370

245

(33.8)

Note: figures may not add up exactly due to rounding. Excluding the Russian subsidiary Banca Intesa included in IMI C&IB

80

1H20 including €60m in provisions for future COVID-19 impacts

MIL-BVA327-15051trim.13-90141/LR

International Subsidiary Banks: Q2 vs Q1

€ m

1Q20

2Q20

%

Net interest income

331

322

(2.8)

Net fee and commission income

123

116

(5.6)

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

19

44

128.8

Other operating income (expenses)

(5)

(11)

(111.7)

Operating income

468

471

0.6

Personnel expenses

(131)

(130)

(0.4)

Other administrative expenses

(81)

(85)

4.3

Adjustments to property, equipment and intangible assets

(27)

(27)

(1.2)

Operating costs

(239)

(242)

1.1

Operating margin

229

229

(0.0)

Net adjustments to loans

(22)

(103)

363.6

Net provisions and net impairment losses on other assets

(14)

14

n.m.

Other income (expenses)

5

0

(92.1)

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

198

141

(28.9)

Taxes on income

(46)

(30)

(35.0)

Charges (net of tax) for integration and exit incentives

(9)

(9)

8.9

Effect of purchase price allocation (net of tax)

0

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

(0)

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

143

102

(29.2)

Q2 including €60m in provisions for future COVID-19 impacts

Note: figures may not add up exactly due to rounding. Excluding the Russian subsidiary Banca Intesa included in IMI C&IB

81

MIL-BVA327-15051trim.13-90141/LR

Private Banking: 1H20 vs 1H19

€ m

1H19

1H20

%

Net interest income

89

102

14.6

Net fee and commission income

843

840

(0.4)

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

28

11

(60.7)

Other operating income (expenses)

2

2

0.0

Operating income

962

955

(0.7)

Personnel expenses

(168)

(165)

(1.8)

Other administrative expenses

(93)

(97)

4.3

Adjustments to property, equipment and intangible assets

(27)

(29)

7.4

Operating costs

(288)

(291)

1.0

Operating margin

674

664

(1.5)

Net adjustments to loans

(2)

(18)

800.0

Net provisions and net impairment losses on other assets

(23)

(22)

(4.3)

Other income (expenses)

9

6

(33.3)

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

658

630

(4.3)

Taxes on income

(184)

(195)

6.0

Charges (net of tax) for integration and exit incentives

(9)

(7)

(22.2)

Effect of purchase price allocation (net of tax)

(1)

(1)

0.0

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

464

427

(8.0)

1H20 including €6m in provisions for future COVID-19 impacts

Note: figures may not add up exactly due to rounding

82

Private Banking: Q2 vs Q1

€ m

1Q20

2Q20

%

Net interest income

48

54

11.9

Net fee and commission income

427

414

(3.1)

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

3

9

242.3

Other operating income (expenses)

0

1

600.0

Operating income

478

478

0.0

Personnel expenses

(78)

(87)

11.9

Other administrative expenses

(49)

(48)

(0.8)

Adjustments to property, equipment and intangible assets

(14)

(15)

1.7

Operating costs

(141)

(150)

6.5

Operating margin

336

327

(2.7)

Net adjustments to loans

(3)

(16)

477.8

Net provisions and net impairment losses on other assets

(6)

(16)

185.7

Other income (expenses)

6

0

(100.0)

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

334

296

(11.5)

Taxes on income

(103)

(92)

(11.1)

Charges (net of tax) for integration and exit incentives

(4)

(3)

(17.7)

Effect of purchase price allocation (net of tax)

(0)

(0)

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

(100.0)

Net income

227

200

(11.6)

Note: figures may not add up exactly due to rounding

MIL-BVA327-15051trim.13-90141/LR

Q2 including €6m in provisions for future COVID-19 impacts

83

MIL-BVA327-15051trim.13-90141/LR

Asset Management:

1H20 vs 1H19

€ m

1H19

1H20

%

Net interest income

0

0

n.m.

Net fee and commission income

342

343

0.3

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

4

(4)

n.m.

Other operating income (expenses)

18

16

(11.1)

Operating income

364

355

(2.5)

Personnel expenses

(36)

(35)

(2.8)

Other administrative expenses

(33)

(32)

(3.0)

Adjustments to property, equipment and intangible assets

(3)

(3)

0.0

Operating costs

(72)

(70)

(2.8)

Operating margin

292

285

(2.4)

Net adjustments to loans

0

0

n.m.

Net provisions and net impairment losses on other assets

0

0

n.m.

Other income (expenses)

0

0

n.m.

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

292

285

(2.4)

Taxes on income

(66)

(73)

10.6

Charges (net of tax) for integration and exit incentives

0

0

n.m.

Effect of purchase price allocation (net of tax)

0

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

0

0

n.m.

Net income

226

212

(6.2)

Note: figures may not add up exactly due to rounding

84

MIL-BVA327-15051trim.13-90141/LR

Asset Management:

Q2 vs Q1

€ m

1Q20

2Q20

%

Net interest income

(0)

(0)

(13.7)

Net fee and commission income

174

169

(3.1)

Income from insurance business

0

0

n.m.

Profits on financial assets and liabilities at fair value

(12)

8

n.m.

Other operating income (expenses)

6

10

80.5

Operating income

168

186

10.7

Personnel expenses

(16)

(19)

20.5

Other administrative expenses

(16)

(16)

1.7

Adjustments to property, equipment and intangible assets

(1)

(1)

(0.4)

Operating costs

(33)

(37)

10.6

Operating margin

135

150

10.8

Net adjustments to loans

0

0

n.m.

Net provisions and net impairment losses on other assets

(0)

0

n.m.

Other income (expenses)

0

0

n.m.

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

135

150

10.9

Taxes on income

(35)

(38)

9.9

Charges (net of tax) for integration and exit incentives

(0)

(0)

0.0

Effect of purchase price allocation (net of tax)

0

0

n.m.

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

(0)

(0)

(6.5)

Net income

100

111

11.3

Note: figures may not add up exactly due to rounding

85

MIL-BVA327-15051trim.13-90141/LR

Insurance:

1H20 vs 1H19

€ m

1H19

1H20

%

pro-forma(1)

Net interest income

0

0

n.m.

Net fee and commission income

0

1

n.m.

Income from insurance business

599

674

12.5

Profits on financial assets and liabilities at fair value

0

0

n.m.

Other operating income (expenses)

(5)

(5)

0.0

Operating income

594

670

12.8

Personnel expenses

(45)

(48)

6.7

Other administrative expenses

(53)

(53)

0.0

Adjustments to property, equipment and intangible assets

(5)

(7)

40.0

Operating costs

(103)

(108)

4.9

Operating margin

491

562

14.5

Net adjustments to loans

0

0

n.m.

Net provisions and net impairment losses on other assets

0

(9)

n.m.

Other income (expenses)

0

0

n.m.

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

491

553

12.6

Taxes on income

(129)

(156)

20.9

Charges (net of tax) for integration and exit incentives

0

(8)

n.m.

Effect of purchase price allocation (net of tax)

(8)

(9)

12.5

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

(30)

(53)

76.7

Net income

324

327

0.9

Note: figures may not add up exactly due to rounding

(1) Data restated to take into account the effects of the RBM Assicurazione Salute acquisition

86

MIL-BVA327-15051trim.13-90141/LR

Insurance:

Q2 vs Q1

€ m

1Q20

2Q20

%

pro-forma(1)

Net interest income

(0)

0

n.m.

Net fee and commission income

0

0

2.3

Income from insurance business

342

332

(3.1)

Profits on financial assets and liabilities at fair value

0

0

n.m.

Other operating income (expenses)

(2)

(2)

(6.8)

Operating income

340

330

(3.1)

Personnel expenses

(22)

(26)

20.0

Other administrative expenses

(23)

(30)

29.0

Adjustments to property, equipment and intangible assets

(4)

(4)

10.1

Operating costs

(48)

(60)

23.6

Operating margin

292

270

(7.6)

Net adjustments to loans

0

0

n.m.

Net provisions and net impairment losses on other assets

(6)

(2)

(62.4)

Other income (expenses)

0

0

n.m.

Income (Loss) from discontinued operations

0

0

n.m.

Gross income (loss)

286

268

(6.3)

Taxes on income

(83)

(73)

(11.7)

Charges (net of tax) for integration and exit incentives

(2)

(7)

354.7

Effect of purchase price allocation (net of tax)

(5)

(3)

(30.1)

Levies and other charges concerning the banking industry (net of tax)

0

0

n.m.

Impairment (net of tax) of goodwill and other intangible assets

0

0

n.m.

Minority interests

(37)

(17)

(53.8)

Net income

160

167

4.6

Note: figures may not add up exactly due to rounding

(1) Data restated to take into account the effects of the RBM Assicurazione Salute acquisition

87

MIL-BVA327-15051trim.13-90141/LR

Quarterly P&L

€ m

1Q19

2Q19

3Q19

4Q19

1Q20

2Q20

pro-forma(1)pro-forma(2)

Net interest income

1,756

1,761

1,741

1,747

Net fee and commission income

1,865

1,965

1,966

2,166

Income from insurance business

323

304

321

320

Profits on financial assets and liabilities at fair value

458

634

480

356

Other operating income (expenses)

(1)

10

5

(10)

Operating income

4,401

4,674

4,513

4,579

Personnel expenses

(1,388)

(1,419)

(1,422)

(1,519)

Other administrative expenses

(587)

(625)

(637)

(752)

Adjustments to property, equipment and intangible assets

(260)

(252)

(261)

(285)

Operating costs

(2,235)

(2,296)

(2,320)

(2,556)

Operating margin

2,166

2,378

2,193

2,023

Net adjustments to loans

(369)

(554)

(473)

(693)

Net provisions and net impairment losses on other assets

(30)

(37)

(19)

(168)

Other income (expenses)

6

1

(2)

50

Income (Loss) from discontinued operations

19

22

22

25

Gross income (loss)

1,792

1,810

1,721

1,237

Taxes on income

(535)

(446)

(532)

(312)

Charges (net of tax) for integration and exit incentives

(22)

(30)

(27)

(27)

Effect of purchase price allocation (net of tax)

(40)

(28)

(37)

(12)

Levies and other charges concerning the banking industry (net of tax)

(146)

(96)

(96)

(22)

Impairment (net of tax) of goodwill and other intangible assets

0

0

0

0

Minority interests

1

6

15

8

Net income

1,050

1,216

1,044

872

1,747 1,750

1,844 1,744

369 367

994 263

  1. 12

4,939 4,136

(1,356) (1,380)

  1. (583)
  1. (267)

(2,173) (2,230)

2,766 1,906

  1. (1,398)(3)
  1. 262(4)
  1. (21)
  1. 1,134

1,976 1,883

  1. (313)
  1. (35)
  1. (24)
  1. (86)

00

  1. (10)

1,151 1,415

Note: figures may not add up exactly due to rounding

  1. Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement and to take into account the effects on Operating costs of the Prelios agreement related to UTP servicing and the RBM Assicurazione Salute acquisition
  2. Data restated to take into account the effects of the RBM Assicurazione Salute acquisition
  3. Including ~€880m in provisions for future COVID-19 impacts
  4. Including the write-back of ~€300m in provisions for future COVID-19 impacts booked in 1Q20

88

Net Fee and Commission Income: Quarterly Development Breakdown

€ m

Net Fee and Commission Income

1Q19

2Q19

3Q19

4Q19

1Q20

2Q20

pro-forma

(1)

Guarantees given / received

55

56

58

60

50

49

Collection and payment services

119

128

123

137

114

103

Current accounts

308

306

304

304

293

295

Credit and debit cards

74

80

89

82

63

68

Commercial banking activities

556

570

574

583

520

515

Dealing and placement of securities

180

195

190

199

185

168

Currency dealing

3

2

3

2

3

3

Portfolio management

542

561

571

697

550

516

Distribution of insurance products

326

361

363

391

344

333

Other

62

65

69

68

62

50

Management, dealing and consultancy activities

1,113

1,184

1,196

1,357

1,144

1,070

Other net fee and commission income

196

211

196

226

180

159

Net fee and commission income

1,865

1,965

1,966

2,166

1,844

1,744

Note: figures may not add up exactly due to rounding

(1) Data restated for the full line-by-line deconsolidation of the acquiring activities due to the Nexi agreement

89

Market Leadership in Italy

1H20 Operating Income

Leader in Italy

Breakdown by business area(1)

IMI Corporate &

Investment Banking

27%

Banca

42% dei Territori

Insurance 7%

Private Banking

10%

4%10%

Asset Management International Subsidiary Banks

Ranking

Market share(2)

%

1

17.0

Loans

1

Deposits(3)

18.8

1 Asset Management(4)

22.0

1

Pension Funds(5)

23.2

Note: figures may not add up exactly due to rounding

(1) Excluding Corporate Centre

(2) Data as at 30.6.20

(3) Including bonds

(4) Mutual funds; data as at 31.3.20

(5) Data as at 31.3.20

90

International Subsidiary Banks: Key P&L Data by Country

Data as at 30.6.20

( % vs 1H19)

Operating Income

Operating Costs

€ m

€ m

(3.7)

(13.7)

+7.4

(5.7)

+1.2

(10.9)

(7.8)

(11.4)

(9.6)

(5.3)

+14.3

220

210

179

126

83

33

21

21

18

8

5

Slovakia

Croatia

Egypt

Serbia

Hungary

Slovenia

Bosnia

Romania

Albania

Ukraine

Moldova

Operating Margin

€ m

(19.9)

(6.2)

+1.2

(11.7)

+35.9

(25.0)

(11.5)

(23.8)

(32.2)

+9.8

(21.9)

118

110

102

77

30

11

11

8

6

1

(2)

Croatia

Slovakia

Egypt

Serbia

Hungary

Slovenia

Bosnia

Albania

Romania

Moldova

Ukraine

(1.1)

(4.3)

+17.0

(11.7)

+5.9

(1.1)

+2.7

(3.6)

+5.2

(0.7)

+15.5

110

92

76

53

49

22

14

10

10

10

4

Slovakia

Croatia

Egypt

Hungary

Serbia

Slovenia

Romania

Bosnia

Albania

Ukraine

Moldova

Gross Income

€ m

(6.2) (33.9) (23.9) (22.2) (41.0) (34.0) (63.6) (66.5) (82.5) (42.6) n.m.

99

82

74

58

20

8

5

4

4

1

(2)

Egypt

Croatia

Slovakia

Serbia

Hungary

Albania

Romania

Bosnia

Slovenia

Moldova

Ukraine

Note: excluding the Russian subsidiary Banca Intesa included in IMI C&IB

91

International Subsidiary Banks by Country: 8.6% of the Group's Total Loans

Data as at 30.6.20

Total

Total

CEE

Hungary Slovakia Slovenia Croatia Bosnia Serbia Albania Romania Moldova Ukraine

Egypt

Oper. Income (€ m)

83

220

33

210

21

126

18

21

5

8

744

179

923

% of Group total

0.9%

2.4%

0.4%

2.3%

0.2%

1.4%

0.2%

0.2%

0.1%

0.1%

8.2%

2.0%

10.2%

Net income (€ m)

(0)

24

0

54

2

41

5

3

1

(2)

128

72

200

% of Group total

n.m.

0.9%

0.0%

2.1%

0.1%

1.6%

0.2%

0.1%

0.0%

n.m.

5.0%

2.8%

7.8%

Customer Deposits (€ bn)

4.0

15.9

2.4

9.3

0.7

4.3

1.2

0.9

0.2

0.1

39.0

4.8

43.8

% of Group total

0.9%

3.6%

0.5%

2.1%

0.2%

1.0%

0.3%

0.2%

0.0%

0.0%

8.9%

1.1%

10.0%

Customer Loans (€ bn)

3.1

14.7

1.9

7.0

0.8

3.6

0.4

0.8

0.1

0.1

32.3

2.5

34.8

% of Group total

0.8%

3.6%

0.5%

1.7%

0.2%

0.9%

0.1%

0.2%

0.0%

0.0%

8.0%

0.6%

8.6%

Total Assets (€ bn)

5.9

18.5

2.8

12.1

1.1

5.9

1.4

1.3

0.2

0.2

49.6

5.9

55.5

% of Group total

0.7%

2.2%

0.3%

1.4%

0.1%

0.7%

0.2%

0.2%

0.0%

0.0%

5.8%

0.7%

6.5%

Book value (€ m)

662

1,556

297

1,707

158

889

179

185

36

61

5,730

534

6,264

- intangibles

32

117

6

22

2

44

4

3

2

2

234

8

242

Note: figures may not add up exactly due to rounding. Excluding the Russian subsidiary Banca Intesa included in IMI C&IB

92

International Subsidiary Banks by Country: Loan Breakdown and Coverage

Data as at 30.6.20

Total

Total

CEE

Hungary Slovakia Slovenia Croatia Bosnia Serbia

Albania Romania Moldova Ukraine

Egypt

Performing loans (€ bn)

3.0

14.5

1.8

6.8

0.8

3.5

0.4

0.8

0.1

0.1

31.8

2.4

34.2

of which:

Retail local currency

41%

61%

42%

33%

32%

22%

22%

11%

60%

24%

45%

55%

46%

Retail foreign currency

0%

0%

0%

19%

15%

29%

13%

19%

1%

2%

8%

0%

8%

Corporate local currency

25%

34%

58%

24%

11%

4%

14%

35%

18%

39%

29%

28%

28%

Corporate foreign currency

34%

5%

0%

24%

42%

45%

51%

35%

22%

35%

18%

16%

18%

Bad loans

(1)

(€ m)

15

97

2

41

4

18

5

12

0

0

194

0

194

(2)

46

91

22

154

9

21

6

14

1

0

364

47

411

Unlikely to pay (€ m)

Performing loans coverage

1.4%

0.7%

1.1%

1.6%

2.1%

1.6%

1.7%

2.1%

4.4%

1.7%

1.1%

1.5%

1.2%

Bad loans

(1)

coverage

69%

64%

89%

81%

73%

68%

55%

57%

50%

n.m.

71%

100%

72%

(2)

47%

46%

45%

43%

40%

61%

40%

39%

48%

n.m.

45%

45%

45%

Unlikely to pay coverage

Annualised cost of credit

(3)

(bps)

75

48

91

108

164

116

4

36

n.m.

251

76

20

72

Note: figures may not add up exactly due to rounding. Excluding the Russian subsidiary Banca Intesa included in IMI C&IB

  1. Sofferenze
  2. Including Past due
  3. Net adjustments to loans/Net customer loans

93

Common Equity Ratio as at 30.6.20: from Phased-into ProMIL-BVA327-forma-15051trim.13-90141/LRFully Loaded

~€ bn

~bps

Direct-deduction relevant items

DTA on losses carried forward(1)

1.3

46

IFRS9 transitional adjustment

(2.1)

(71)

Total

(0.8)

(24)

Cap relevant items(*)(2)

Total

0.0

14

(*) as a memo, constituents of deductions subject to cap:

- Other DTA(3)

1.5

- Investments in banking and financial companies

0.7

RWA from 100% weighted DTA(4)

(8.2)

41

Total estimated impact

31

Pro-

forma fully loaded Common Equity ratio

14.9%

Note: figures may not add up exactly due to rounding

  1. Considering the expected absorption of DTA on losses carried forward (€1.5bn as at 30.6.20)
  2. Following the application of the Danish Compromise, insurance investments are risk weighted instead of being deducted from capital. In the amount of insurance investments, the expected distribution of 1H20 Net income of insurance companies is considered, which for the sake of simplicity is left included in the benefit allocated to this caption
  3. Other DTA: mostly related to provisions for risks and charges, considering the total absorption of DTA related to IFSR9 FTA (€1.1bn as at 30.6.20) and DTA related to the non-taxable public cash contribution of €1,285m covering the integration and rationalisation charges relating to the acquisition of operations of the two former Venetian banks (€0.3bn as at 30.6.20). DTA related to goodwill realignment and adjustments to loans are excluded due to their treatment as credits to tax authorities
  4. Considering the total absorption of DTA convertible into tax credit related to goodwill realignment (€5.0bn as at 30.6.20) and adjustments to loans (€3.3bn as at 30.6.20)

94

Total Exposure(1) by Main Countries

€ m

DEBT SECURITIES

Banking Business

Insurance

LOANS

Total

AC

FVTOCI

FVTPL(2)

Total

Business(3)

EU Countries

29,088

50,123

10,157

89,368

64,355

153,723

386,431

Austria

135

118

29

282

4

286

1,102

Belgium

2,256

1,093

65

3,414

156

3,570

1,046

Bulgaria

0

0

0

0

89

89

26

Croatia

57

1,164

182

1,403

165

1,568

7,042

Cyprus

0

0

0

0

0

0

273

Czech Republic

106

0

0

106

0

106

576

Denmark

0

29

0

29

19

48

101

Estonia

0

0

0

0

0

0

1

Finland

0

97

26

123

36

159

307

France

2,333

4,764

647

7,744

2,440

10,184

7,861

Germany

1,135

2,792

512

4,439

976

5,415

7,149

Greece

36

0

7

43

0

43

776

Hungary

163

1,003

7

1,173

34

1,207

2,902

Ireland

1,019

1,133

388

2,540

60

2,600

338

Italy

18,095

21,178

7,762

47,035

55,239

102,274

304,522

Latvia

0

0

0

0

0

0

34

Lithuania

0

0

0

0

0

0

4

Luxembourg

124

429

144

697

0

697

5,833

Malta

0

0

0

0

0

0

26

The Netherlands

199

995

209

1,403

702

2,105

3,101

Poland

40

111

0

151

29

180

1,086

Portugal

117

493

0

610

7

617

163

Romania

56

302

1

359

251

610

928

Slovakia

0

1,062

119

1,181

0

1,181

12,852

Slovenia

1

194

125

320

0

320

1,827

Spain

2,853

12,579

-137

15,295

2,623

17,918

3,197

Sweden

0

188

52

240

18

258

231

United Kingdom

363

399

19

781

1,507

2,288

23,127

Albania

405

132

1

538

0

538

396

Egypt

0

1,804

3

1,807

55

1,862

2,826

Japan

0

1,946

661

2,607

89

2,696

1,002

Russia

0

105

9

114

46

160

5,336

Serbia

0

712

9

721

0

721

3,886

U.S.A.

898

8,969

209

10,076

2,722

12,798

7,764

Other Countries

1,121

3,942

515

5,578

2,988

8,566

23,102

Total

31,512

67,733

11,564

110,809

70,255

181,064

430,743

Note: management accounts. Figures may not add up exactly due to rounding

  1. Exposure to sovereign risks (central and local governments), banks and other customers. Book Value of Debt Securities and Net Loans as at 30.6.20
  2. Taking into account cash short positions
  3. Excluding securities in which money is collected through insurance policies where the total risk is retained by the insured

95

MIL-BVA327-15051trim.13-90141/LR

Exposure to Sovereign Risks(1) by Main Countries

€ m

DEBT SECURITIES

Banking Business

Insurance

Total

FVTOCI/AFS

LOANS

AC

FVTOCI

FVTPL(2)

Total

Business(3)

Reserve (4)

EU Countries

19,403

42,414

7,200

69,017

56,138

125,155

-350

11,774

Austria

0

34

29

63

2

65

0

0

Belgium

1,333

945

46

2,324

4

2,328

-34

0

Bulgaria

0

0

0

0

62

62

0

0

Croatia

0

1,164

182

1,346

154

1,500

2

1,225

Cyprus

0

0

0

0

0

0

0

0

Czech Republic

0

0

0

0

0

0

0

0

Denmark

0

21

0

21

0

21

0

0

Estonia

0

0

0

0

0

0

0

0

Finland

0

45

0

45

3

48

1

0

France

2,040

3,249

503

5,792

739

6,531

-90

4

Germany

516

1,890

364

2,770

353

3,123

-19

0

Greece

0

0

7

7

0

7

0

0

Hungary

1

1,000

7

1,008

34

1,042

1

114

Ireland

673

524

-1

1,196

57

1,253

-6

0

Italy

12,077

18,865

5,918

36,860

52,685

89,545

-19

10,005

Latvia

0

0

0

0

0

0

0

34

Lithuania

0

0

0

0

0

0

0

0

Luxembourg

0

0

0

0

0

0

-1

0

Malta

0

0

0

0

0

0

0

0

The Netherlands

52

383

106

541

77

618

-3

0

Banking Business Government bond

Poland

40

59

0

99

18

117

-1

0

duration: 6.5y

Portugal

85

477

-41

521

0

521

-12

0

Romania

56

302

1

359

251

610

-8

7

Adjusted duration due to hedging: 1y

Slovakia

0

1,034

119

1,153

0

1,153

-1

127

Slovenia

1

187

125

313

0

313

1

204

Spain

2,529

12,207

-192

14,544

1,599

16,143

-161

54

Sweden

0

19

53

72

0

72

0

0

United Kingdom

0

9

-26

-17

100

83

0

0

Albania

405

132

1

538

0

538

1

1

Egypt

0

1,804

3

1,807

55

1,862

-1

0

Japan

0

1,909

635

2,544

0

2,544

-1

0

Russia

0

105

9

114

0

114

-6

0

Serbia

0

712

9

721

0

721

4

100

U.S.A.

349

7,714

-126

7,937

10

7,947

-61

0

Other Countries

984

2,247

288

3,519

1,201

4,720

-99

5,826

Total

21,141

57,037

8,019

86,197

57,404

143,601

-513

17,701

Note: management accounts. Figures may not add up exactly due to rounding

  1. Exposure to central and local governments. Book Value of Debt Securities and Net Loans as at 30.6.20
  2. Taking into account cash short positions
  3. Excluding securities in which money is collected through insurance policies where the total risk is retained by the insured
  4. Net of tax and allocation to insurance products under separate management

96

MIL-BVA327-15051trim.13-90141/LR

Exposure to Banks by Main Countries(1)

€ m

DEBT SECURITIES

Banking Business

Insurance

LOANS

Total

AC

FVTOCI

FVTPL(2)

Total

Business(3)

EU Countries

2,074

4,624

1,050

7,748

3,593

11,341

27,753

Austria

125

48

0

173

0

173

209

Belgium

0

128

17

145

24

169

463

Bulgaria

0

0

0

0

0

0

2

Croatia

43

0

0

43

0

43

5

Cyprus

0

0

0

0

0

0

1

Czech Republic

0

0

0

0

0

0

1

Denmark

0

8

0

8

0

8

67

Estonia

0

0

0

0

0

0

0

Finland

0

21

26

47

0

47

95

France

175

960

86

1,221

965

2,186

6,139

Germany

17

611

134

762

48

810

3,631

Greece

0

0

0

0

0

0

759

Hungary

133

3

0

136

0

136

14

Ireland

0

38

0

38

0

38

21

Italy

1,283

1,329

583

3,195

1,481

4,676

6,069

Latvia

0

0

0

0

0

0

0

Lithuania

0

0

0

0

0

0

0

Luxembourg

0

325

138

463

0

463

569

Malta

0

0

0

0

0

0

0

The Netherlands

72

314

26

412

206

618

251

Poland

0

52

0

52

0

52

5

Portugal

0

16

0

16

0

16

2

Romania

0

0

0

0

0

0

76

Slovakia

0

28

0

28

0

28

0

Slovenia

0

7

0

7

0

7

3

Spain

131

339

20

490

359

849

811

Sweden

0

141

-1

140

18

158

12

United Kingdom

95

256

21

372

492

864

8,548

Albania

0

0

0

0

0

0

17

Egypt

0

0

0

0

0

0

217

Japan

0

32

25

57

59

116

69

Russia

0

0

0

0

0

0

83

Serbia

0

0

0

0

0

0

122

U.S.A.

242

750

308

1,300

1,312

2,612

814

Other Countries

31

1,304

146

1,481

668

2,149

4,135

Total

2,347

6,710

1,529

10,586

5,632

16,218

33,210

Note: management accounts. Figures may not add up exactly due to rounding

  1. Book Value of Debt Securities and Net Loans as at 30.6.20
  2. Taking into account cash short positions
  3. Excluding securities in which money is collected through insurance policies where the total risk is retained by the insured

97

MIL-BVA327-15051trim.13-90141/LR

Exposure to Other Customers by Main Countries(1)

€ m

DEBT SECURITIES

Banking Business

Insurance

Total

LOANS

Business(3)

AC

FVTOCI

FVTPL(2)

Total

EU Countries

7,611

3,085

1,907

12,603

4,624

17,227

346,904

Austria

10

36

0

46

2

48

893

Belgium

923

20

2

945

128

1,073

583

Bulgaria

0

0

0

0

27

27

24

Croatia

14

0

0

14

11

25

5,812

Cyprus

0

0

0

0

0

0

272

Czech Republic

106

0

0

106

0

106

575

Denmark

0

0

0

0

19

19

34

Estonia

0

0

0

0

0

0

1

Finland

0

31

0

31

33

64

212

France

118

555

58

731

736

1,467

1,718

Germany

602

291

14

907

575

1,482

3,518

Greece

36

0

0

36

0

36

17

Hungary

29

0

0

29

0

29

2,774

Ireland

346

571

389

1,306

3

1,309

317

Italy

4,735

984

1,261

6,980

1,073

8,053

288,448

Latvia

0

0

0

0

0

0

0

Lithuania

0

0

0

0

0

0

4

Luxembourg

124

104

6

234

0

234

5,264

Malta

0

0

0

0

0

0

26

The Netherlands

75

298

77

450

419

869

2,850

Poland

0

0

0

0

11

11

1,081

Portugal

32

0

41

73

7

80

161

Romania

0

0

0

0

0

0

845

Slovakia

0

0

0

0

0

0

12,725

Slovenia

0

0

0

0

0

0

1,620

Spain

193

33

35

261

665

926

2,332

Sweden

0

28

0

28

0

28

219

United Kingdom

268

134

24

426

915

1,341

14,579

Albania

0

0

0

0

0

0

378

Egypt

0

0

0

0

0

0

2,609

Japan

0

5

1

6

30

36

933

Russia

0

0

0

0

46

46

5,253

Serbia

0

0

0

0

0

0

3,664

U.S.A.

307

505

27

839

1,400

2,239

6,950

Other Countries

106

391

81

578

1,119

1,697

13,141

Total

8,024

3,986

2,016

14,026

7,219

21,245

379,832

Note: management accounts. Figures may not add up exactly due to rounding

  1. Book Value of Debt Securities and Net Loans as at 30.6.20
  2. Taking into account cash short positions
  3. Excluding securities in which money is collected through insurance policies where the total risk is retained by the insured

98

MIL-BVA327-15051trim.13-90141/LR

Disclaimer

"The manager responsible for preparing the company's financial reports, Fabrizio Dabbene, declares, pursuant to paragraph 2 of Article 154 bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corresponds to the document results, books and accounting records".

* * *

This presentation includes certain forward looking statements, projections, objectives and estimates reflecting the current views of the management of the Company with respect to future events. Forward looking statements, projections, objectives, estimates and forecasts are generally identifiable by the use of the words "may," "will," "should," "plan," "expect," "anticipate,"

"estimate," "believe," "intend," "project," "goal" or "target" or the negative of these words or other variations on these words or

comparable terminology. These forward-looking statements include, but are not limited to, all statements other than statements of historical facts, including, without limitation, those regarding the Company's future financial position and results of operations, strategy, plans, objectives, goals and targets and future developments in the markets where the Company participates or is seeking to participate.

Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements as

a prediction of actual results. The Group's ability to achieve its projected objectives or results is dependent on many factors which are outside management's control. Actual results may differ materially from (and be more negative than) those projected or implied in the forward-looking statements. Such forward-looking information involves risks and uncertainties that could significantly affect expected results and is based on certain key assumptions.

All forward-looking statements included herein are based on information available to the Company as of the date hereof. The Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law. All subsequent written and oral forward- looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements.

99

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Intesa Sanpaolo S.p.A. published this content on 04 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 August 2020 12:01:01 UTC