Hrvatska Poštanska Banka d.d.

Investor Presentation • Apr 12, 2016

REORGANIZATION, RECAPITALIZATION AND RESULTS OF HPB – THE LARGEST BANK INCROATIAN OWNERSHIP

Tomislav Vuić, President of the Management Board

Successful 2015

• • EU's approval of the recapitalization process (DG Competition – MEO)
• • Recapitalization through public offer, amounting to HRK 550 mln – 55% private investors ~ 25% of total ownership
• •Bank reorganization
• • Increase in market share, loans and retail deposits
• • Substantial improvement of cooperation with Croatian Post
• •Best financial result in HPB's corporate history
• • Best bank by return on equity in Croatia –9,4%

TO FOLLOW ADVICE OUTLINED IN THIS PRESENTATION DOES NOT NECESSARILY MEAN YOU WILL NOT MAKE ANY MISTAKES

Every company is ^a unique story as restructuring goals and executives' ambitions are frequently different.

Nevertheless, some rules I have learnt in the first two mergers out of 6transformations I took part in were present in each:

• • Decisions should be made and implemented quicklywith subsequent adjustments – post implementation
• • Delays andcompromises cost more in the future
• • All changes start fromthe top
• • Sometimes you canachieve what seems impossible

HPB – SUCCESSFUL, UNVERSAL BANK

(customer focus, excellence, taking responsibility, achievement-oriented culture, agility/speed, teamwork)

RETAIL SEGMENT

• 632.000 clients
• 53 business units
• 421.000 current accounts
• HRK 8,6 bn. in deposits
• 683.000 HPB cards
• Market share growth inloans and deposits

largest retail network in Croatia through 1.000 postal offices

CORPORATE SEGMENT

• 8 regional centersthroughout Croatia
• 9.471 business giro accounts
• HRK 6 bn. of Croatian sovereign debt financing
• Improving cooperation withstate units and public funds
• Significant growth incorporates that initiatecooperation with the Bank

FY 2015 RESULTS EXCEEDED STRATEGIC GUIDELINES PRESENTED TO EUROPEAN COMMISSION AND PRIVATE INVESTORS

2014 – PROS AND CONS OF TAKING OFFICE AS PRESIDENT OF THE MANAGEMENT BOARD

• •Insufficient capital adequacy
• • Recapitalization under approval of the European Commission (threat of bank recovery and even liquidation of the bank)
• •Possible outflows of deposits
• •Weak client structure with regard to age and income
• •High operating costs
• • Outdated organization and ignorance of current trends
• • No investment in knowledge, skills and HR development
• •Limited access to foreign financing

• • Bank is perceived as a government institution which is slow, focused on pensioners and public companies, linked to public scandals and losses

• •636.000 clients in total

• •1.000 offices of Croatian Post
• •Large depositor base
• •Focus on HRK in assets and liabilities
• •No CHF risk
• •Limited need for CAPEX
• • Public sympathy (to the extent possible) for a Croatian-owned bank
• • Trust of current clients and satisfaction with theirprimary bank
• • Turning most problems and disadvantages (low starting base) into opportunities

WHAT IS IMPORTANT FOR EVERY RESTRUCTURING

PRECONDITIONS

• •Motivation *
• •Knowledge
• •Courage

* Motivation and a real desire to make a difference is most important, whilst a moderate lack knowledge orcourage may be compensated for.

MAIN FOES

• •Demotivation (often in the beginning)
• • Ignorance (with regard to profession, trends, neglecting education and savings, narrow horizons)
• • Fear (of changes, for existential security, personal and family included)
• •Habits and sloth
• •Ego and insecurity

ALWAYS STRIKE A BALANCE!

Need for change due to unsustainable existing model

Retain the company healthy aspects of the company, motivated and enthusiasticemployees

Decrease in costs – always necessary (potential is limited, requires minimal knowledge but firm will, large layoffs and savings are not stimulating and motivating)

Growth and increase in revenue (theoretically the sky is the limit, more skills and a bit of creativity needed, can't be forecasted with certainty) + greater goal above profitability (Croatian interests and interests of its citizens)

Quick wins – simple solutions with quickly visible outcomes, in light of the environment and more so due to motivation of managers and employees

Structural solutions which bring prosperity to the company in the long run (in the short run they tend to increase burden and costs)

CHANGE IN CORPORATE CULTURE –MOST IMPORTANT GOAL OF HUMAN RESOURCES

2015 – BANK WITH HIGHEST RETURN ON EQUITY IN CROATIA

BANKING SECTOR & HPB – ACTION & REACTION

*2016: sector estimate & HPB's operating plan

MEDIA ABOUT HPB

4,42% 4,77%

2014 2015 2016E

(1,6%) (0,5%)

+3,4%

1. za Hrvatsku poštansku banku

+3,0%

ukupni depoziti

+1,0%

(0,0%)

4,79% 4,79%4,90%

SEKTOR

(4,2%)+1,4%2014 2015 2016E

ukupni krediti krediti stanovništvu

+7,3%

+1,5%

(0,7%)

4,37%

y-o-y stope

*procjena 2016. godine za sektor & operativni plan

+5,8%+8,1%3,71% 4,04%

(1,5%)(0,8%)2014 2015 2016EHPB SEKTOR tržišni udio depoziti stanovništva*

4,51% 4,56%

*+1,5% +2,0% +2,6% +0,5%

2014 2015 2016E

ONCE AGAIN - THE MOST IMPORTANT OF ALL

• • Client orientation (real benefit – fair price –availability)
• • Culture of defining, monitoring andachieving goals (excellent performancemanagement system)
• •Excellent IT (for a bank)
• • Clear and communicated strategy, openmindedness to new ideas and courage to implement and innovate
• • Unity and team spirit – betweenorganizational units and employees

SIZE AND STRENGTH DO NOT MATTER, BUT ABILITY TO ADAPT TO CHANGES DOES

APPENDIX

HPB AND FELLOW COLLEAGUES DURING THE RECAPITALIZATION PROCESS:David Tomašek, Domagoj Karadjole, Darko Blagović - DUUDI, Dubravka Kolarić, Krešimir Dragić – Ministry of Finance, Tomislav Vuić, Hrvoje Bujanović – PBZ , Marijana Liszt – Law Office Posavec, Rašica & Liszt, Goran Horvat - KPMG, Angelika Terek, Tomica Pustišek – TP Consultum

RESUME AND EXPERIENCE IN TRANSFORMATIONS AND MERGERS

• •2014 – today Hrvatska poštanska banka – CEO
• • 2003 – 2014 Erste & Steiermärkische Bank d.d., Croatia –deputy CEO
• • 2013 – 2014 Erste Card Ljubljana, Slovenia – Chairman of theSupervisory Board
• • 2009 – 2011 ESB Podgorica, Montenegro – Deputy Chairmanof the Supervisory Board
• • 2007 – 2010 Diners Club Russia – Supervisory Boardmember
• • 2006 – 2014 Erste Card Club d.o.o., Croatia – Chairman of the Supervisory Board
• • 2004 – 2006 Kvarner Wiener Städtische Osiguranje d.d., Croatia – SB Member
• •2002 – 2003 – Erste & Steiermärkische Bank, Croatia – CEO
• • 1997 – 2000 Trgovačka banka – Management Board Member (CEO in 2000)
• • 1995 – 1996 Law office Žuri^ći Partneri – partner

• • 1993 – 1995 Law office Ratko Žurić, Bojan Fras, Tomislav Vuić – attorney-at-law

• • Merger of Trgovačka banka d.d., Zagreb, Čakovečka banka d.d. Čakovec and Bjelovarska banka d.d. Bjelovar

• • Merger of Riječka banka d.d., Rijeka and Erste & Steiermarkische Banka d.d.
• • Acquisition and transformation of Diners Club Adriatic d.d. into Erste Card Club d.d.
• • Acquisition of American institution for micro financing'Opportunity International' and transformation into Erstebanka AD Podgorica
• • Acquisiton and transformation of Diners Club Slovenija into Erste Card Slovenija d.o.o.
• • Reorganization and recapitalization of Hrvatska poštanska banka d.d., Zagreb

RECAPITALIZATION, EU COMMISSION, PARTIAL PRIVATIZATION AND REGULAR ACTIVITIES - SIMULTANEOUSLY

BACKGROUND TO RECAPITALIZATION & RECAPITALIZATION IN 2015

• HNB performed on-site examination of HPB during Q2 2014
• Sep 2014 HNB issues a Resolution outlining insufficient NPL impairmentsand provisions, and imposes a CAR minimum of 14% on the Bank
• new Management Board takes office in Q4 2014 balance sheet cleansingand initiating rationalization measures
• 2014: HRK 635 million net loss due to recognized impairment losses andprovisions (HRK 935 million of total impairment losses)
• HPB enters 2015 with CAR equaling 6,7 percent (danger of rehabilitation or even liquidation of the bank)
• H1 2015 negotiation with European Commission (DG Competition) about recapitalitation – presentation and successful argumentation of MEO Business plan
• Jun 2015 DG COMP's conditional acquiescence on MEO plan & HPB enters into negotiations with investors road show and activities regarding issuance of shares
• Sep 2015 successful recapitalization through a public share offer HRK 550 mn. raised (55% by private investors^≈ 25% equity stake in HPB)
• capital adequacy after recapitalization exceeds 16 percent

ACHIEVED DURING 2015

• defining HPB's development strategy – on sound foundations
• improvements to previously neglected risk management
• strong focus on utilization of HPB's advantages in retail segment (market share growth & growth in number of clients)
• development of model of cooperation with HP Hrvatska pošta
• implementation of most modernm-banking solution in Croatia
• successful reorganization – number of organizational units was cut from ⁹⁴ to 71
• significant staff refreshment through arrival of executives and experts frominternational groups (Unicredit, Intesa SP, Erste & Steiermärkische, Societe-Generale...)
• Efficiency improvements
• Funding structure improvements
• Best financial results in HPB's corporate history:
• -NET PROFIT HRK 123 million (previously 2007: HRK 121 million)
• -OPERATING PROFIT HRK 322 million (previously 2014: HRK 300 million)

FIRST PRESENTATION TO WIDER NUMBER OF MANAGERS 2014 - motivation

HPB – Best bank in Croatia by quality of services and products, market growth and profitability

Is this possible? Is it possible to achieve this at the same time? Is he serious?Are we the best bank already? How can we do it?In which period?Why should we do it?

HRVATSKA POŠTANSKA BANKA

Tomislav Vui ćOctober 24 2014

FIRST PRESENTATION TO WIDER NUMBER OF MANAGERS 2014

HPB

Best bank in

Croatia

For whom?

Clients

Without them there is no bank, whilstwithout quality services and products there are no clients. Ever-demanding, ever-protected and ever-informed they expect cheap prices, understanding and availability.

Community

Our greatest contribution, banking excellence, encouraging employment, following regulation and best business practices.

Shareholders

Expect earnings which are paid-out, bank profitability – security and trust, especially in the long run.

Employees

Culture of achieving goals, high motivation, performance management system and constant learning. Learning from the best and benchmarking with them.

SAVINGS IN 2015 – VIGILANT PROCUREMENT, RENEGOTIATIONS WITH SUPPLIERS

Protection services

Cleaning services

*2016: sector estimate & HPB's operating plan

• • HRK 24 million of savings (annualized) achieved through cost management activities
• savings effective mostly from H1 2015, but significant improvements are already accomplished
• • 2016 and onwards should bring additional savingsthrough better job organization and efficient processes

C i h l l i d d i 2 0 1 5 t t t t o s g r o u p s w a r g e s c u s r e a z e u r n g ( i b d l ) 2 0 1 5 2 0 1 4 t t c o m p a r s o n e e e n a n a c a s w u
E i & i t t t q p m e n a s s e s m a n e n a n c e u	8, 5 % -
P l i t o s a s e r c e s v	1 7, 4 % -
T l i i t e e c o m m u n c a o n s	1 7, 9 % -

Currency transportation services -20,7%

Future of Public Companies - Dubrovnik, April 2016²⁰

-16,5%

-15,3%

CAPITALIZATION IN THE PAST

SLIGHT UPTRENDS IN INDICATORS DURING THE RESTRUCTURING YEAR – SUBSTANTIAL POTENTIAL FOR IMPROVEMENT

PRODUCT DEVELOPMENT IN SPITE OF COMPLEX RECAPITALIZATION & REORGANIZATION PROCESSES

DISCLAIMER

This presentation was prepared for the sole purpose of presenting HPB p.l.c. (later in the text: "HPB" or "the Bank") to the attendees of regional conference Future of Public Companies (later in the text: "the Conference"), which is to be held on Apr 15 2016 in Dubrovnik.

The presentation does not include all potential information and should be accompanied with the verbal presentation by the Bank's CEO Mr. TomislavVuić, and was thus prepared for the specific purpose of presenting HPB at the Conference. The presentation is not comprehensive, nor does it contain all necessary information which might be necessaryfor investors to decide whether to initiate ^a buy or sell transaction of HPB-R-A stock.

All the data and opinions that are part of this presentation are prepared by the Bank and have not been subject to audit or any other similar validationprocedure in full. It is assumed that future events could affect the presented data and the Bank is not obliged to update or adjust the data accordingly. Every investor considering the purchase of HPB shares is advised to follow its own judgment of HPB's financial position, including the inherent risks.

This presentation may include forward-looking information, including expectations and plans for the Bank's financial position and results for the yearending December 31 2016. This information represents financial data based on current assumptions and management's expectations about eventsthat could happen in the future. This information is of ^a subjective nature, and demands consideration, and is liable to risks and uncertainties whichcould cause actual results to differ materially from the forward-looking information presented in this document. No guarantee or representation, in goodfaith, is or is going to be given - by the Bank, its management or employees - for any obligation for or based on false representation.

The Bank (including related parties, management, employees or any other person involved), will bear no liability, to the extent permitted by the law, forany losses, damages or expenses that might be incurred as ^a result of the investors' or any third party's reliance on information contained in thispresentation or for any statements related to this presentation.