Hrvatska Poštanska Banka d.d.

Earnings Release • Oct 25, 2016

SUCCESS CONTINUES

FINANCIAL RESULTS Jan 01 – Sep 30 2016

Source: http://www.thebanker.com/World/Central-Eastern-Europe/Top-250-EU-banks-assets-down-profits-up

Press conference

Zagreb, October 25 2016

VISION

Largest Croatian-owned banking group that takes best possible care of the financial security and prosperity of its clients and community.

HPB Group respects its owners and ensures long-term sustainable return on invested capital.

TRENDS IN 2016

• net profit and operating profit exceed records set in 2015
• market share growth
• growth in total loans and deposits
• strong housing loans growth
• momentum set for growth and profitability
• 26 thousand of newly opened current accounts
• client base grows by 13 thousand during 2016
• HPB has 650 thousand of faithful clients

2016 SURPASSES RECORD BREAKING 2015 AND IS BETTER THAN PLANNED

NON-INTEREST INCOME GROWTH & CONSTANT COSTS

Operating profit (HRK million)

Impairments (HRK million) Net profit (HRK million)

• net interest: general market trend of decreasing interest rates. Income growth in retail operations due to strong volume addition, that annuled the effect of lower interest rates. Corporate decline due to dynamics of volume growth (effectuated in Q3 2016).
• net fees: opening of new retail current accounts (26 thousand in 2016) and corporate accounts (+1,2 thousand in 2016) created a basis for long-term sustainable revenue
• trading: soaring prices on capital markets & efficient management of FX position
• ostali income: sale of AFS securities and VISA Europe Ltd. ownership stake in 2016
• operating costs: positive impact of carried-out reorganization process has annuled regulation expenses & higher deposit insurance expense due to deposit growth in 2016.
• operating profit: increase resulted in further improvements in C/I indicator to 52,2%
• impairments and provisions: improved collection in 2016, combined with high NPL coverage - above 67 posto (in comparison with 1H 2016 sector average of 60%)
• net profit strong profitability continues new best 9m result, that surpasses the full year record set in 2015

LOAN & DEPOSIT GROWTH SIGNIFICANTLY ABOVE THE MARKET

Source for sector: www.hnb.hr (aggregate statistical reports for credit institutions)

POTENTIAL PARTIALLY UTILISED IN RETAIL SEGMENT

ITEM (IN HRK)	Dec 31 2015	Sep 30 2016	Δ YTD 2016	MARKET SHARE (est)
RETAIL LOANS	4.634.571.446	5.235.533.920 HRK 1,1 billion of new volume	+13,0%	4,5% +0,8 pp in 2016
HOUSING LOANS	961.008.397	1.433.853.499	+49,2%	2,7% +1,1 pp in 2016
OTHER LOANS	3.673.563.049	3.801.680.421	+3,5%	5,8% +0,2 pp in 2016

HPB GROWTH vs SECTOR DECLINE

Retail loans Housing loans

BENEFIT FOR CROATIAN ECONOMY BY PROVIDING FINANCING FOR COMMERCIAL PROJECTS THAT GENERATE VALUE

ITEM (IN HRK)	Dec 31 2015	Sep 30 2016	Δ YTD 2016	MARKET SHARE (est)
LOANS TO NON-FINANCIAL CORPORATE ENTITIES	7.679.392.796	8.182.144.255	+6,5%	5,6%
		HRK 2,5 billion of new volume		+0,3 pp in 2016
LOANS TO COMPANIES	4.185.847.569	4.575.208.867	+9,3%	5,1%
				+0,3 pp in 2016
LOANS TO OTHER LEGAL ENTITIES	3.493.545.227	3.606.935.388	+3,2%	6,5%
				+0,5 pp in 2016

vs

Loans to non-financial corporate entities Loans to companies

HPB SECTOR

OTHER INFORMATION ABOUT HPB

• 26 thousand of new current accounts & 1,2 thousand of new business accounts ytd 2016
• client base grows by 13 thousand clients in 2016

• HRK 3,6 billion of new loan volume in 2016

• SuperSmart HPB won the SoMo Tech prize for the best mobile application (Weekend media festival, Rovinj, September 2016)
• renowned magazine The Banker indicated HPB as one of the rising stars in the analysis 'Top 250 EU banks' (The Banker, September 2016)

DISCLAIMER:

This presentation was prepared for the sole purpose of presenting HPB p.l.c. (later in the text: "HPB" or "the Bank") to attendees of press conference held on October 25 2016, with regard to the publication of quarterly unconsolidated financial reports of HPB for Q3 2016.

The presentation does not include all potential information and should be accompanied with the verbal presentation by the Bank's management, and was thus prepared for specific purpose of presenting HPB at the conference. Presentation is not comprehensive, nor does it contain all necessary information which might be necessary for 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 validation procedure 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 financial position and results for the year ending December 31 2016. These information represent financial data based on current assumptions and management's expectations about events that could happen in the future. These information are of subjective nature, and demand consideration, and are liable to risks and uncertainties which could cause actual results to differ materially from the forward-looking information presented in this document. No guarantee or representation, in good faith, 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, agents or advisers or any other person involved), will bear no liability, to the extent permitted by the law, for any losses, damages or expenses that might be incurred as a result of the investors' or any third party's reliance on information contained in this presentation or for any statements related to this presentation.