Banco Comercial Portugues

Earnings Release • Jul 30, 2021

TO GROW NOW

1H21 BANCO BPI CONSOLIDATED RESULTS

30th JULY 2021

"DISCLAIMER"

• The purpose of this presentation is purely informative and should not be considered as a service or offer of any financial product, service or advice, nor should it be interpreted as, an offer to sell or exchange or acquire, or an invitation for offers to buy securities issued by Banco BPI ("BPI") or any of the companies mentioned herein. The information contained herein is subject to, and must be read in conjunction with, all other publicly available information. Any person at any time acquiring securities must do so only on the basis of such person's own judgment as to the merits or the suitability of the securities for its purpose and only on such information as is contained in such public information set out in the relevant documentation filed by the issuer, having taken all such professional or other advice as it considers necessary or appropriate in the circumstances and not in reliance on the information contained in this presentation.
• BPI cautions that this presentation might contain forward-looking statements concerning the development of its business and economic performance. While these statements are based on BPI's current projections, judgments and future expectations concerning the development of the Bank's business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from BPI's expectations. Such factors include, but are not limited to the market general situation, macroeconomic factors, regulatory, political or government guidelines and trends, movements in domestic and international securities markets, currency exchange rates and interest rates, changes in the financial position, creditworthiness or solvency of BPI customers, debtors or counterparts.
• Statements as to historical performance or financial accretion are not intended to mean that future performance or future earnings for any period will necessarily match or exceed those of any prior year. Nothing in this presentation should be construed as a profit forecast. In addition, it should be noted that although this presentation has been prepared based on accounting registers kept by BPI and by the rest of the Group companies it may contain certain adjustments and reclassifications in order to harmonize the accounting principles and criteria followed by such companies with those followed by BPI.
• In particular, regarding the data provided by third parties, BPI does not guarantee that these contents are exact, accurate, comprehensive or complete, nor it is obliged to keep them updated, nor to correct them in the case that any deficiency, error or omission were to be detected. Moreover, in reproducing these contents by any means, BPI may introduce any changes it deems suitable, may omit partially or completely any of the elements of this document, and in case of any deviation between such a version and this one, BPI assumes no liability for any discrepancy.
• In relation to Alternative Performance Measures (APMs) as defined in the guidelines on Alternative Performance Measures issued by the European Securities and Markets Authority on 5 October 2015 (ESMA/2015/1415), this report uses certain APMs, which have not been audited, for a better understanding of the company's financial performance. These measures are considered additional disclosures and in no case replace the financial information prepared under the International Financial Reporting Standards (IFRS). Moreover, the way the Group defines and calculates these measures may differ to the way similar measures are calculated by other companies. Accordingly, they may not be comparable. Please refer to the Glossary section for a list of the APMs used along with the relevant reconciliation between certain indicators.
• This document has not been submitted to the Comissão do Mercado of Valores Mobiliários (CMVM) (Autoridade Portuguesa do Mercado of Capitais) for review or for approval. Its content is regulated by the Portuguese law applicable at the date hereto, and it is not addressed to any person or any legal entity located in any other jurisdiction. For this reason it may not necessarily comply with the prevailing norms or legal requisites as required in other jurisdictions.
• Notwithstanding any legal requirements, or any limitations imposed by BPI which may be applicable, permission is hereby expressly refused for any type of use or exploitation of the content of this presentation, and for any use of the signs, trademarks and logotypes contained herein. This prohibition extends to any kind of reproduction, distribution, transmission to third parties, public communication or conversion by any other mean, for commercial purposes, without the previous express consent of BPI and/or other respective proprietary title holders. Any failure to observe this restriction may constitute a legal offence which may be sanctioned by the prevailing laws in such cases.

Permanent support to Families, Businesses, and Society

Consolidated net income: 185 M.€ (vs 43 M.€ in 1H20)

Net income from the activity in Portugal: 84 M.€ (vs 6 M.€ in 1H20)

Strong commercial dynamism,

in a very adverse environment; loans grew by 5.9% YoY and total Customer resources 8.4% YoY;

Gross income increased by 11.5% YoY,

net interest income up 3.2%, showing notable resilience, and net fees and commissions rose 11.0%;

Digital transformation on track and improved Customer experience:

740 thousand digital clients, of which 495 thousand with BPI app (+65 thousand YoY).

Strong economic and financial position:

NPE of 1.5%, with 156% coverage; CET1 ratio of 14.3% and total capital ratio of 17.4%; investment grade ratings by the three main international agencies;

More social commitment, support to innovation and sustainable development

30 M.€ in 2021 in support to Society, with "la Caixa" Foundation; 4 M.€ for BPI "la Caixa" awards; 1 M.€ for the Decentralised Social Initiative; BPI, "la Caixa" Foundation and FCT commit 2.5 M.€ to the development of Portugal's inland regions through the "Promove Programme";

TodosJuntos Initiative raises 2.5 M.€ for food aid, with the support of BPI, 9 other banks and more than 30 companies.

BPI RESULTS IN 1ST HALF 2021

Net profit	 Consolidated net profit of 185 M.€ in 1st half 2021 (vs. 43 M.€ in 1H20) Activity in Portugal contributes with 84 M.€ (vs. 6 M.€ in 1H20) 
Customer loans and resources increase	Total Customer resources increase 3.0 Bn.€ YoY (+8.4%); Deposits increase 10.5% YoY  Loan portfolio increases 1.5 Bn.€ YoY (+5.9%)
High asset quality	Non-performing exposures ratio (NPE EBA) decreases to 1.5% in June 2021   NPE coverage by impairments and collaterals increases to 156% Cost of credit risk of 0.04% in 1H21 1st half 2021 (non annualised) 
Strong capitalisation	 Capital ratios (phasing-in): CET1 of 14.3%, T1 of 15.8% and total capital of 17.4%  Leverage ratio (phasing-in): of 7.2%
Investment grade rating	 Senior debt: Moody's upgraded the rating to Baa2 in July; BBB+ and BBB ratings by Fitch and S&P.  Deposits: rated Baa1 by Moody's and BBB+ by Fitch

CONSOLIDATED NET PROFIT OF 185 M.€ IN 1ST HALF 2021

€ In M	Jun 20	Jun 21
Activity in Portugal
profit Recurrent net	6	89
1) Non-recurrent impacts		-5
profit in Portugal Net	6	84
and contribution BFA BCI	36	101
profit Consolidated net	43	185

Recurrent net profit in Portugal (M.€)

Of which	 YoY
Commercial Banking Gross Income (2) 	+22 M.€
 Reduction in loan impairments	+73 M.€
Gains / (losses) on financial assets and  liabilities and other operating income and expenses	+14 M.€
Costs reduction 	+1 M.€
 Income tax and other	-28 M.€

Activity in Portugal
	Jun 20	Jun 21
Recurrent ROTE (last 12 months)	5 4%	5 9%

1) Early retirements and voluntary terminations

5

2) Net interest income, fees and commissions, dividends and share of profits of associates (equity accounted).

BFA AND BCI CONTRIBUTION

BFA: distribution of dividends and reserves

In Q2 21, BFA's shareholders approved the 2020 ordinary dividend and a distribution of free reserves, with payment to shareholders in 3 instalments (1)

• 119 M.€ (2) attributed to BPI:
  • 40 M.€ of 2020 ordinary dividend
  • 79 M.€ of distribution of free reserves of which,
    • 50 M.€ accounted for in income statement
    • 29 M.€ booked directly to reserves
  • The 119 M.€ will be recognised in Common Equity T1 (CET1) when received in Portugal

BFA and BCI contribution to consolidated net profit

In M €	20 Jun	21 Jun
contribution BFA	33	92
Of which ,
ordinary dividend 2020		40
distribution of free reserves taken income to statement		50
contribution BCI	3	9
Total	36	101

At 30 Jun.21, the 48.1% stake in BFA was valued at 264 M.€

1) The distribution of reserves will be paid to shareholders in 3 instalments: 40% in Sep.21, 30% in Jun.22 and 30% in Jun.23. 2) Net of tax and financial effect.

6

LOAN PORTFOLIO GROWS 5.9% YoY

Loans to Customers by segments

Jun 20	Jun 21	YoY	YtD
13 311	14 222	6.8%	3.5%
11 638	12 454	7.0%	3.7%
1 673	1 768	5.7%	1.8%
9 788	10 216	4.4%	1.4%
1 877	2 021	7.7%	7.6%
24 977	26 459	5.9%	3.0%
24 517	25 962	5.9%	3.0%

Market share
of total loan portfolio	10.8% +0.2 p.p. YoY
	(May 2021)

SUPPORT TO FAMILIES AND BUSINESSES

Moratoria Covid19 support lines 2)

ENDED MORATORIA

Good performance of loans after resuming payment obligations

MORTGAGE LENDING ORIGINATION INCREASES 35% YoY

BPI, A BANK FOR FAMILIES

With proposals and solutions for every moment of your life

My home

0-0 Auto	Projetos	------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Tecnologia	Lazer	021 H Energias Renovave is
			.	.

Enjoying Life Sleeping Peacefully

Looking to the Future

inTouch SUCCESS OF NEW OMNICHANNEL SERVICE

New model of omnichannel customer relationship, through a remote personal account manager (launched on 31 Jan. 20)

An innovative service that addresses the different needs of the various types of Clients

BPI, A BANK FOR COMPANIES

The partner for Companies and Small Businesses at the critical stages of their lives

BPI, A BANK FOR TOURISM

BPI continues to support companies in the tourism industry and to reward the most outstanding companies and projects

PARTNERSHIPS IN THE SEGMENT

- Official sponsor of Bolsa de Viagens powered by BTL

• Founding partner of NEST‒ Centro de Inovação do Turismo

BPI/Rota EN2 Line: finance protocol

BPI, A BANK FOR AGRICULTURE

BPI continues to support companies in the agriculture sector and to reward the most outstanding companies and projects

Under the Rural Development Programme ("PDR")

April 2021

LEADERSHIP IN AGRICULTURAL SECTOR

• #1 by lending amount (IFAP)
• #1 by no. of advances on subsidies (CAP)

NATIONAL AGRICULTURE AWARDS

9th edition

• Partnership with Cofina and sponsorship of the Ministry of Economy
• Distinction of 10 success stories in the national agricultural sector
• Debate with participation of Maria Céu Antunes, Minister of Agriculture, and Isabel Jonet, Chairman of the Food Bank Against Hunger

PARTNERSHIPS IN THE SEGMENT

BPI sponsors the main national agricultural fairs, for closer proximity with the sector's professionals.

• Ovibeja (since 2012)
• FNA - National Agricultural Fair (since 2014)
• Agroglobal
• Colóquio do Milho

TOTAL CUSTOMER RESOURCES INCREASE 8.4% YoY

Deposits +10.5% YoY and Assets under management +8.4% YoY

Customer resources					Market shares
In M €	Jun 20	Jun 21	YoY	YtD
I Customer deposits	24 933	27 543	10 5%	5 9%	Deposits
II Assets under management	9 288	10 068	8 4%	4 4%	Mutual funds
funds Mutual	4 817	5 813	20 7%	9 5%
Capitalisation insurance	4 471	256 4	8% -4	8% -1
Public offerings III	438 1	052 1	-26 8%	-21 3%
Total	35 658	38 664	8 4%	5% 4

	May 21	YoY 
Deposits	10 8%	+0 3 p.p.
Mutual funds	10 8%	-0 5 p.p.
Capitalisation insurance	17 5%	+1 3 p.p.
Retirement savings plans	11 4%	+0 2 p.p.

BPI APP INCREASINGLY RELEVANT

More Clients, more sales and greater proximity

Greater proximity to the Clients and increase in Digital Sales

1) Digitally initiated contracting of Term Deposits and Savings, Mutual Funds and Retirement Saving Plans, Personal loans, Prestige Products, Credit and Prepaid Cards and Cash Advance on Credit Cards 2) Transactions made through Net, Mobile or ATM;

16

3) BASEF (May 2021), and CSI Banks 2nd Wave 2020 – CSI Digital Channels Index (main banks);

4) Inmark 2021

INNOVATION IN THE DIGITAL CHANNELS

Enhanced Experience of Individual Clients

Simplification of Day-to-Day routines

• Increased support to Clients' financial management (My Finance service)
• Financial Diary with a simpler, more intuitive and integrated vision
• Improved payment experience and increase in Credit Card ceiling
• Simplification of contracting, cancellation and replacement of Debit Cards through the Digital Channels
• New mobile responsive public website bancobpi.pt
• Improvement of digital documentation
• Easier and faster access to MB WAY Payments
• Online Account opening with Digital Mobile Key

My Home

Mortgage Loan Simulator in Digital Channels

Enjoying Life and Sleeping Peacefully

• Life Insurance linked to Mortgage and Personal Loans
• Simulator to define insured capital sum when taking out "BPI Family Life" insurance"
• Multi-Risk/Home Insurance Claims Reporting

Looking to the Future

Launch of BPI Broker on BPI Net

INNOVATION IN THE DIGITAL CHANNELS

Strong investment in the transformation of Corporate and Small business clients' experience

	New digital solutions for Companies
 New APP BPI Empresas: Improved design and simpler browsing  Biometric authentication  New functionalities 	 Extension of BPI Drive solution to new commercial partners  Instant Loans for companies, 100% digital: Simulation and contracting on  BPI Net Empresas Automated decision  Funds made available on the spot 	Simplification of Customer contact  with the Commercial Networks  Support to application to Moratoria  Improved support to subscription of financial products

GROSS INCOME INCREASES 11.5%

Commercial banking gross income increases 6.5%

Gross income in the activity in Portugal
Jun 20	Jun 21		Resilience of net interest income, +3.2%
			Growth in loan volume
220	227	3.2%	ALCO management
10	12	24.5%	Intermediation margin narrowed
117	130	11.0%	Net fee and commission income increases 11.0%
347	370	6.5%	Fees and commissions on loans; accounts and related services
( 33)	( 20)		Fees and commissions from mutual funds and capitalisation insurance
			Insurance intermediation
			Fees and commissions on payment means
	314	350	% 11.5%

19

OPERATING EXPENSES DECREASE

CORE COST-TO-INCOME IMPROVES TO 56.2%

Core cost-to-income

(Recurring operating expenses as % of commercial banking gross income)

REGULATORY COSTS OF 41.6 M.€ IN 2021

22

COST OF CREDIT RISK FALLS TO ZERO %

BPI MAINTAINS LOW RISK PROFILE AND INCREASES COVERAGE

	Jun.21
NPL ratio (EBA criteria)	1.8%
Non-Performing Loans (NPL)	558 M.€
NPL coverage by impairments and collaterals	157%
Foreclosed properties (net book value)	5 M.€
Corporate restructuring and recovery funds (book value)

107% PENSION COVERAGE

Employee pension liabilities

M €	Dec 20	Jun 21
Total liability past service	907 1	785 1
of the funds Net pension assets	(1) 1 873	1 903
Level of of pension liabilities coverage	98%	107%
Pension fund return (YtD annualised) , non	2 7%	3 2%
Discount rate	01% 1	33% 1

Actuarial deviations (M €)	1H 21
from investment portfolio Income	47
Change the discount in rate	103
Other	-1
Actuarial deviations	150

BPI MAINTAINS HIGH CAPITALISATION

26 1) Includes combined capital buffer requirement RWA – Risk Weighted Assets ; LRE – Leverage Ratio Exposure.

BALANCED FUNDING AND COMFORTABLE LIQUIDITY

1) 12-month average, in accordance with the EBA guidelines. Average value (previous 12 months) of the calculation components: Liquidity reserves (9 745 M.€); Total net outflows (3 407 M.€).

2) High Quality Liquid Assets (HQLA) of 10.4 Bn.€ and other assets eligible as collateral with ECB of 1.1 Bn.€

27

SUSTAINABILITY AND INNOVATION

• AgroGrIN Tech, a start-up that submitted the best national project, "born from scientific and technological knowledge".
• The award ceremony featured a real-life testimonial from Feedzai, one of the 4 Portuguese unicorns

28

BPI'S QUALITY, INNOVATION AND DEDICATION TO ITS CLIENTS CONTINUE TO BE DISTINGUISHED

SOCIAL COMMITMENT 30 M.€ TO SUPPORT SOCIETY IN 2021

"la Caixa" Foundation initiative with the collaboration of BPI

• Humaniza Programme
• Incorpora Programme
• Proinfância Programme
• Seniors Always with Company Programme
• Promove Programme
• BPI "la Caixa" Foundation Awards
• Volunteer Evaluators of the BPI "la Caixa" Foundation Awards
• CooperantesCaixa Voluntary service
• Decentralised Social Initiative
• Partis & Art for Change
• Social Science Research
• Social Equity Initiative-Nova SBE
• Global Platform for Syrian Students

Culture and Science

• Creactivity and Itinerant Exhibitions, Participative and School Concerts
• Support to Creation Programme
• Serralves Foundation
• Casa da Música
• Museu Nacional de Arte Antiga
• Porto University Museum of Natural History and Science
• Coimbra University Science Museum / Cabinet of Curiosities
• Casa da Arquitetura
• Casa de São Roque
• Elvas Contemporary Art Museum
• Caramulo Museum
• Teatro Nacional D. Maria II
• Teatro Nacional S. João
• Espaço do Tempo
• Orquestra XXI
• Orquestra Sem Fronteiras
• Matosinhos Jazz Orchestra

Research and Health

• Health Research
• CaixaImpulse

Education and scholarships

• Post-graduation scholarships
• PhD and post-doctoral fellowships for outstanding researchers
• Young Entrepreneur Programme

SUPPORT TO SOCIETY

Joint Action BPI "la Caixa" Foundation

#TODOSJUNTOS

• BPI, 9 other banks and more than 30 companies joined forces in a solidarity initiative to support the most vulnerable families.
• 2.5 M.€ for the purchase of basic foodstuffs and 20% of the total amount for medicines.
• Aid distributed by the Food Emergency 2.5 M.€ Network.

5 BPI "la Caixa" Foundation Awards

improve the quality of life of people with social vulnerability.

• Capacitar
• Solidary
• Seniors
• Childhood
• Rural

raised

Decentralised Social Initiative

Support to local social projects through BPI's Commercial Networks.

1st Half 2021 Results

• 85 projects
• 611 th€
• 20 511 direct beneficiaries

Winners of 3rd Edition of Promove Programme

• BPI, "la Caixa" Foundation and the Foundation for Science and Technology allocate more than 2.5 M.€ for the development of Portugal's inland regions
• The 3rd edition of the Promove Programme will support 10 pilot projects, 6 innovative ideas and 3 mobilising research and development projects, focusing on the transformation and development of inland regions.

SUPPORT TO SOCIETY

Joint Action BPI "la Caixa" Foundation

Portugal Social Balance 2020

The "la Caixa" Foundation, BPI, and Nova SBE launched the report "Portugal, Social Balance 2020" - A portrait of the country and the effects of the pandemic.

Access to healthcare - citizens' choices 2020

The "la Caixa" Foundation, BPI and Nova SBE launched the Report "Access to healthcare - Citizens' choices 2020". The report aims to draw a portrait of access to healthcare by the Portuguese population.

Window of Hope

BPI, la Caixa Foundation, the Calouste Gulbenkian Foundation and SIC Esperança have launched the largest platform for stories about the third sector.

Volunteering

Launch and implementation of various initiatives, from financial literacy and entrepreneurship in schools, to capacity building of institutions, and care for the elderly living alone.

1st Half 2021 Results

• +700 enrolled
• • 100 initiatives carried out
• +3 300 people impacted

Support to Mozambique – Beira Central Hospital

The Neonatology Unit of the Beira Central Hospital in Mozambique was inaugurated in May. In 2020, BPI contributed 100 th.€ towards the acquisition and installation of equipment for this unit, which had been heavily affected by the destruction wrought by Cyclone Idai in 2019.

The sum was applied by Health4Moz, a Portuguese NGDO that works in the promotion of child and family health in Mozambique.

PORTUGAL NOW

BPI and students from the Loures Arts Conservatory launch Hymn of support to the National Team

Loures Arts Conservatory is a social solidarity institution supported by BPI and "la Caixa" Foundation since 2020, with the objective of promoting social inclusion, through art, of children and young people in vulnerable situations.

As the "Official Teams Bank", BPI challenged 30 students and teachers from the Loures Arts Conservatory ("CAL") to create an anthem in support of the Portuguese national football team.

The song "Portugal NOW" was part of BPI's communication campaign for the European Football Championship. The young artists had the support of Fred Ferreira, a musician of the Orelha Negra band.

HIGHLIGHTS OF 1ST HALF 2021 RESULTS

Strong commercial dynamism, despite the adverse economic environment

High capitalisation, low risk profile and comfortable liquidity position

Gross income growth and efficiency improvement

Reinforcement of social commitment under joint intervention with "la Caixa" Foundation

Digital transformation and innovation on track

BPI will continue to be a partner for families and companies and to support the recovery of the Portuguese economy

BPI RESULTS

in 1st half of 2021

Commercial activity in Portugal	Loan portfolio +1.5 BN.€ +5.9%  YoY	Customer resources +3.0 Bn.€ +8.4%  YoY	Gross +11.5% income +3.2% Net Interest Income +11.0% Fee & commission income  YoY	Digital Banking Regular users 740 th. BPI app users + 65 th. YoY 
Risk and capitalisation	NPE ratio (EBA) 1.5%	NPE coverage 156% (by impairments and collaterals)	Cost of Risk 0.04% (as % of loans and guarantees; non- annualised)	14.3% CET1 15.8% T1 17.4% Total (Phasing-in)
Profit and profitability	Net profit in Portugal 84 M.€	Recurring ROTE in Portugal 5.9% (last 12 months)	Cost-to-income in Portugal 56.2% (last 12 months)	Consolidated net profit 185 M.€

CONSOLIDATED RESULTS

ANNEXES

01 BPI Ratings versus peers

Income Statements and Balance sheet in accordance with IAS / IFRS and consolidated indicators

03

Reconciliation between BPI reported figures and BPI Segment contribution to CaixaBank Group

04

02

Alternative Performance Measures

As of 28th July 2021

MOODY'S UPGRADES BPI RATING

	(Long Term Debt/ Issuer Credit Rating)	(Long Term Debt/ Issuer rating)	(Issuer Default Rating)	(Long-Term Debt/ Issuer Rating)
e d	…AA, AA+ e AAA	…Aa2, Aa1, e Aaa	…AA, AA+ e AAA	…AA, AA (high), AAA
	AA-	Aa3 Mortgage bonds	AA	Mortgage bonds AA (low)
	A+	A1	A+	A (high)
	A	A2	A	Bank 1 A
a r G	A	A3	A	A (low)
	BBB	Baa1 Deposits	Deposits Bank 1 BBB+ Senior debt	BBB (high)
	Bank 1 BBB	Baa2	BBB	Bank 3 BBB
	BBB	Bank 3 Bank 1 Baa3	BBB	Bank 2 BBB (low)
	BB+	Bank 2 Ba1	Bank 3 BB+	BB (high)
	Bank 2 BB	Ba2	Bank 2 BB	BB
	BB	Ba3	BB	BB (low)
e d	B+	B1	B+	Bank 5 B (high)
a r	B	B2	B	Bank 4 B
g	B	Bank 4 B3	Bank 4 B	B (low)
	CCC+	Caa1	CCC+	CCC (high)
	CCC	Bank 5 Caa2	CCC	CCC
	S&P (20 out.20) reaffirmed BPI and its long term senior debt rating of with Stable outlook.	Moody's (13 Jul.21) has upgraded BPI senior debt BBB,	Fitch and its long term ratings from Baa3 to Baa2, with a stable outlook, and reaffirmed the LT deposit rating of Baa1, improving the outlook on the deposit's rating to positive.	(19 out.20) reaffirmed BPI's LT senior debt and LT deposits ratings of BBB+ and BPI rating of BBB, with Negative outlook.

Non-Investment

Investment

INCOME STATEMENT OF THE ACTIVITY IN PORTUGAL

12/14/2 Departments of the distribute
	Pacable Caracticulate Ages
	Daily Product Sales by Country

38

€ In M	Jun 20	Reclassif	Jun 20	Jun 21	% Jun21
		(1)	adjusted		/Jun20 ajust
Net interest income	220 0		220 0	227 1	3 2%
Dividend income	2 1		2 1	1 7	-16 2%
accounted Equity income	9 7		9 7	10 7	35 1%
fee and Net commission income	118 1	-0 8	117 4	130 2	11 0%
Gains/(losses) financial and liabilities and other assets on	-12 4		-12 4	12 1	-
Other and operating income expenses	-23 9	3 2	-20 8	-31 7	-52 5%
Gross income	311 8	2 4	314 2	350 2	11 5%
staff Recurrent expenses	-122 4	-0 8	-123 2	9 -115	9% -5
Other administrative expenses	-70 7	-1 6	-72 3	-71 9	-0 4%
Depreciation and amortisation	-22 8		-22 8	-29 0	27 1%
Recurring operating expenses	-215 9	-2 4	-218 2	-216 8	-0 6%
Non-recurrent costs				-6 6	-
Operating expenses	-215 9	-2 4	-218 2	-223 5	2 4%
operating income Net	95 9		95 9	126 7	32 1%
Impairment losses and other provisions	-84 0		-84 0	-10 2	-87 9%
and losses other Gains in assets	0 7		0 7	0 3	-54 2%
Net income before income tax	12 7		12 7	116 8	-
Income tax	2 -6		2 -6	-32 5	-
income Net	6 5		6 5	84 4	-

1) For analysis purposes, in order to ensure comparability of information, 1st half 2020 figures were adjusted by reclassifications made at the end of 2020 and detailed in the respective Annual Report.

BALANCE SHEET OF THE ACTIVITY IN PORTUGAL

1) Includes short-term public debt of 0.15 Bn.€ (Portugal, Treasury Bills) and medium and long-term of 4.9 Bn.€ (Portugal 50%; Spain 27%, Italy 15% and USA 8%), with an average residual maturity of 3.3 years.

CONSOLIDATED INCOME STATEMENTS

40

€ In M	jun 20	Reclassif (1)	20 Jun adjusted	21 Jun
Net interest income	220 0		220 0	227 1
Dividend income	42 3		42 3	99 7
accounted Equity income	3 11		3 11	20 7
fee and Net commission income	118 1	-0 8	117 4	130 2
Gains/(losses) financial and liabilities and other assets on	9 -17		9 -17	14 1
Other and operating income expenses	-27 1	3 2	-24 0	-39 5
Gross income	346 6	2 4	349 0	452 3
Staff expenses	-122 4	-0 8	-123 2	-122 6
Of which: staff Recurrent expenses Non-recurrent costs	-122 4	-0 8	-123 2	9 -115 -6 6
Other administrative expenses	-70 7	6 -1	-72 3	9 -71
and Depreciation amortisation	-22 8		-22 8	-29 0
Operating expenses	-215 9	-2 4	-218 2	-223 5
operating income Net	130 8		130 8	228 8
losses and other Impairment provisions	-84 0		-84 0	-10 2
Gains and losses other in assets	0 7		0 7	0 3
income before income Net tax	47 5		47 5	219 0
Income tax	0 -5		0 -5	-33 9
income Net	42 6		42 6	185 1
EARNINGS SHARE PER			Jun 20	Jun 21
share (€) Earnings per			0 02	0 12
weighted of shares (in millions) Average nr.			1 456 9	1 456 9

CONSOLIDATED BALANCE SHEET

In M.€	Dec 20	Jun 21
ASSETS
Cash and cash balances central banks and other demand deposits at	535 2 4	083 0 5
Financial held for trading fair value through profit or loss and fair assets , at at value through other comprehensive income	2 258 5	2 068 8
Financial amortised assets at cost	30 004 0	31 220 4
Loans Customers to	25 207 8	25 961 9
and Investments in joint associates ventures	238 2	253 9
Tangible assets	152 9	194 4
Intangible assets	87 0	89 6
Tax assets	271 0	239 7
and disposal groups classified as held for sale Non-current assets	9 7	6 3
Other assets	231 0	433 1
Total assets	37 785.6	39 589.3
LIABILITIES
for Financial liabilities held trading	141 3	120 0
Financial liabilities amortised at cost	33 695 7	35 341 2
- Central Banks and Credit Deposits Institutions	5 504 3	5 763 3
Deposits - Customers	26 008 6	27 660 6
Debt issued securities	804 9 1	502 6 1
Memorandum items: subordinated liabilities	304 3	304 3
Other financial liabilities	378 0	414 7
Provisions	48 7	49 3
Tax liabilities	23 2	22 6
Other liabilities	620 3	514 6
Total Liabilities	34 529.3	36 047.6
Shareholders' attributable the shareholders of equity to BPI	3 256 3	3 541 7
controlling Non interests	0 0	0 0
Total Shareholders' equity	3 256.3	3 541.7
Total liabilities and Shareholders' equity	37 785.6	39 589.3

CONSOLIDATED INDICATORS

Profitability, Efficiency and Liquidity Indicators (Bank of Portugal Instruction no. 16/2004 with the amendments of Instruction 6/2018)	Jun 20	Jun 21
Gross income / ATA	2.1%	2.3%
Net income before income tax and income attributable to non-controlling interests / ATA	0.3%	1.1%
Net income before income tax and income attributable to non-controlling interests / average shareholders' equity (including non-controlling interests)	2.8%	12.8%
Staff expenses / Gross income 1)	35.3%	25.6%
Operating expenses / Gross income 1)	62.5%	47.9%
Loans (net) to deposits ratio	99%	94%
NPE ratio and forborne (according to the EBA criteria)	Jun 20	Jun 21
Non-performing exposures - NPE (M.€)	696	570
NPE ratio	2.0%	1.5%
NPE coverage by impairments	69%	91%
NPE coverage by impairments and collaterals	134%	156%
Ratio of forborne not included in NPE 2)	0.5%	0.5%
"Crédito duvidoso" (non-performing loans) (according to Bank of Spain criteria)	Jun 20	Jun 21
"Crédito duvidoso" (M.€) 3)	738	587
"Crédito duvidoso" ratio	2.8%	2.1%
"Crédito duvidoso" coverage by impairments	65%	88%
"Crédito duvidoso" coverage by impairments and collaterals	125%	147%

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2) Forborne according to EBA criteria and considering the scope of prudential supervision. On jun.21, the forborne was 460 M.€ (forborne ratio of 1.1%), of which 218 M.€ was performing loans (0.5% of the gross credit exposure) and 242 M.€ was included in NPE (0.6% of the gross credit exposure).

¹⁾ Excluding early-retirement costs.

RECONCILIATION BETWEEN BPI REPORTED FIGURES AND BPI SEGMENT CONTRIBUTION TO CAIXABANK GROUP

Profit & loss account

Jun 21 (M.€)	reported As by BPI	Adjustments 1 )	contribution BPI CABK Group to	BPI segment	Equity investments and other segment
Net interest income	227	( 5)	222	223	( 1)
Dividends	100		100	2	98
Equity accounted income	21	( 1)	20	10	10
fees Net and commissions	130		130	130
Trading income	14	1	15	13	2
Other operating income & expenses	( 40)		( 40)	( 32)	( 8)
income Gross	452	( 4)	448	347	101
Recurrent operating expenses	( 217)	( 6)	( 223)	( 223)
Extraordinary operating expenses	( 7)	6	( 1)	( 1)
Pre-impairment income	229	( 6)	223	122	101
[Pre-impairment income without extraordinary expenses]	236	( 11)	225	123	102
losses on financial Impairment assets	( 10)	18	8	8
Other impairments and provisions		( 6)	( 6)	( 6)
Gains/losses on disposals others &
income Pre-tax	219	7	226	125	101
Income tax	( 34)	2	( 32)	( 31)	( 1)
Profit for the period	185	9	194	94	100
Minority interests & other
income Net	185	9	194	94	100

Loan portfolio & customer resources

June 2021 (M.€)	reported by As BPI	Adjustments	BPI contribution to (BPI segment) CABK Group
Loans and advances to customers, net	25 962	( 30)	25 932
funds Total customer	38 664	(4 292)	34 372

Profit & loss account

The difference between the earnings released by BPI and the earnings attributable to CaixaBank Group is largely a result of consolidation adjustments and the net change in the fair value adjustments generated from the business combination.

Additionally, BPI contribution to CaixaBank Group results is broken down into BPI segment and Investments segment contributions, the latter including the contributions from BFA and BCI.

Loan portfolio & customer funds

The difference between BPI reported figures and those reported by CaixaBank for the BPI segment can largely be explained by:

• In loans and advances to customers, net, by the associated fair value adjustments generated by the business combination at 30 June 2021 and consolidation adjustments (elimination of intragroup balances: BPI credit to CaixaBank Payments);
• In total customer funds, by the liabilities under insurance contracts and their fair value adjustments at 30 June 2021, as generated by the business combination, which have been reported in the banking and insurance business segment of CaixaBank following the sale of BPI Vida to VidaCaixa de Seguros y Reaseguros.

1) Consolidation, standardisation and net fair value adjustments in the business combination.

Reconciliation of the profit & loss account structure

• The European Securities and Markets Authority (ESMA) published on 5th October 2015 a set of guidelines relating to the disclosure of Alternative Performance Measures by entities (ESMA/2015/1415). These guidelines are mandatory to issuers with effect from 3rd July 2016.
• In addition to the financial information prepared in accordance with the International Financial Reporting Standards (IFRS), BPI uses a set of indicators for the analysis of performance and financial position, which are classified as Alternative Performance Measures, in accordance with the abovementioned ESMA guidelines. The information relating to those indicators has already been the object of disclosure, as required by ESMA guidelines.
• In the current presentation, the information previously disclosed is inserted by way of cross-reference and a summarized list of the Alternative Performance Measures is presented next.

The following table shows, for the consolidated profit & loss account, the reconciliation of the structure used in this document (Results' Presentation) with the structure adopted in the financial statements and respective notes of the Report and Accounts.

	Adopted acronyms and designations	Units, conventional sings and abbreviations
YtD	Year-to-date change		€, Euros, EUR		euros
YoY	Year-on-year change		th.€, th.euros		thousand euros
QoQ	quarter-on-quarter change		M.€, M.euros		million euros
ECB	European Central Bank		Bn.€, Bi.€		billion euros
BoP	Bank of Portugal				change
CMVM	Securities Market Commission		n.a.		not available
APM	Alternative Performance Measures		0, –		null or irrelevant
MMI	Interbank Money Market		vs.		versus
T1	Tier 1		b.p.		basis points
CET1	Common Equity Tier 1		p.p.		percentage points
RWA	Risk weighted assets		E		Estimate
TLTRO	Targeted longer-term refinancing operations		F		Forecast
LCR	Liquidity coverage ratio
NSFR	Net stable funding ratio

Reconciliation of the consolidated profit & loss account structure

Structure used in the Results' Presentation	21 Jun	21 Jun	Structure presented in the financial and respective statements notes
Net interest income	227.1	227.1	Net interest income
Dividend income	99.7	99.7	Dividend income
accounted Equity income	20.7	20.7	Share of the profit or (-) loss of subsidiaries, and accounted for the method investments in joint ventures associates using equity
fee and Net commission income	130.2	142.1	and Fee commission income
		-11.8	Fee and commission expenses
Gains/(losses) on financial and liabilities and other assets	14.1	0.0	Gains or (-) losses on derecognition of financial and liabilities measured fair value through profit or loss, assets not at net
		3.4	Gains or (-) losses on financial and liabilities held for trading, assets net
		4.4	Gains or (-) losses on non-trading financial mandatorily fair value through profit or loss, assets at net
		-1.1	Gains or (-) losses from hedge accounting, net
		7.4	Exchange differences [gain or (-) loss], net
Other and operating income expenses	-39.5	19.6	Other operating income
		-59.1	Other operating expenses
income Gross	452.3	452.3	GROSS INCOME
Staff expenses	-122.6	-122.6	Staff expenses
Other administrative expenses	-71.9	-71.9	Other administrative expenses
Depreciation and amortisation	-29.0	-29.0	Depreciation
Operating expenses	-223.5	-223.5	Administrative expenses and depreciation
Net operating income	228.8	228.8
Impairment losses and other provisions	-10.2	-1.1	Provisions or (-) reversal of provisions
		-9.1	or (-) reversal of on financial measured fair value through profit or loss Impairment impairment assets not at
Gains and losses other in assets	0.3		or (-) reversal of of subsidiaries, and Impairment impairment investments in joint ventures associates
			or (-) reversal of on non-financial Impairment impairment assets
		0.0	or (-) losses on derecognition of non financial Gains assets, net
		0.3	Profit or (-) loss from and disposal groups classified as held for sale qualifying as discontinued non-current assets not operations
Net income before income tax	219.0	219.0	PROFIT OR (-) LOSS BEFORE TAX FROM CONTINUING OPERATIONS
Income tax	-33.9	-33.9	Tax expense or income related profit or loss from continuing operations to
income from continuing operations Net	185.1	185.1	PROFIT OR (-) LOSS FROM CONTINUING OPERATIONS AFTER TAX
from discontinued Net income operations			Profit or (-) loss after from discontinued tax operations
attributable non-controlling Income to interests			Profit or (-) loss for the period attributable non-controlling to interests
income Net	185.1	185.1	(-) PROFIT OR LOSS FOR THE PERIOD ATTRIBUTABLE TO OWNERS OF THE PARENT

EARNINGS, EFFICIENCY AND PROFITABILITY INDICATORS The following earnings, efficiency and profitability indicators are defined by reference to the above structure of the profit and loss account used in this document.
Gross income	Net interest income + Dividend income + Net fee and commission income + Equity accounted income + Gains/(losses) on financial assets and liabilities and other + Other operating income and expenses
Commercial banking gross income	Net interest income + Dividend income + Net fee and commission income + Equity accounted income excluding the contribution of stakes in African banks
Operating expenses	Staff expenses + Other administrative expenses + Depreciation and amortisation
Net operating income	Gross income – Operating expenses
Net income before income tax	Net operating income – Impairment losses and other provisions + Gains and losses in other assets
Cost-to-income ratio (efficiency 1) ratio)	Operating expenses / Gross income
Core cost-to-income ratio (core efficiency ratio)1)	Operating expenses, excluding costs with early-retirements and voluntary terminations and (only in 2016) gains with the revision of the Collective Labour Agreement (ACT) – Income from services rendered to CaixaBank Group (recorded under Other operating income and expenses) / Commercial banking gross income
Return on Equity (ROE)1)	Net income for the period, less the interest cost of AT1 capital instruments recorded directly in shareholders' equity / Average value in the period of shareholders' equity attributable to BPI shareholders, excluding AT1 capital instruments
Return on Tangible Equity (ROTE)	1) Net income for the period, less the interest cost of AT1 capital instruments recorded directly in shareholders' equity / Average value in the period of shareholders' equity attributable to BPI shareholders (excl. AT1 capital instruments) after deduction of intangible net assets and goodwill of equity holdings
Return on Assets (ROA)1)	(Net income attributable to BPI shareholders + Income attributable to non-controlling interests - preference shares dividends paid) / Average value in the period of net total assets
Unitary intermediation margin	Loan portfolio average interest rate, excluding loans to employees – Deposits average interest rate
BALANCE SHEET AND FUNDING INDICATORS
On-balance sheet Customer resources2)	Deposits + Capitalisation insurance of fully consolidated subsidiaries + Participating units in consolidated mutual funds  Deposits = Demand deposits and other + Term and savings deposits + Interest payable + Retail bonds (Fixed rate bonds placed with Customers)  Capitalisation insurance of fully consolidated subsidiaries (BPI Vida e Pensões sold on Dec.17)
Assets under management3)	Mutual funds + Capitalisation insurance + Pension plans  Mutual funds = Unit trust funds + Real estate investment funds + Retirement-savings and equity-savings plans (PPR and PPA) + Hedge funds + Assets from the funds under BPI Suisse management + Third-party unit trust funds placed with Customers.  Capitalisation insurance4) = Third-party capitalisation insurance placed with Customers  Pension plans4) = Pension plans under BPI management (includes BPI pension plans)
Subscriptions in public offerings	Customers subscriptions in third parties' public offerings

(1) Ratio referring to the last 12 months, except when indicated otherwise. The ratio can be computed for the cumulative period since the beginning of the year, in annualised terms.

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(2) The amount of on-balance sheet Customer resources is not deducted from the applications of off-balance sheets products (mutual funds and pension plans) in on-balance sheet products. (3) Amounts deducted from participating units in the Group banks' portfolios and from off-balance sheet products investments (mutual funds and pension plans) in other off-balance sheet products.

(4) Following the sale of BPI Vida e Pensões in Dec.17, the capitalisation insurance placed with BPI's Customers are recorded off balance sheet, as "third-party capitalisation insurance placed with customers" and pension funds management is excluded from BPI's consolidation perimeter.

BALANCE SHEET AND FUNDING INDICATORS (continuation)
Total Customer resources	On-balance sheet Customer resources + Assets under management + Subscriptions in public offerings
Gross loans to customers	Gross loans and advances to Customers (financial assets at amortised cost), excluding other assets (guarantee accounts and others) and reverse repos + Gross debt securities issued by Customers (financial assets at amortised cost) Note: gross loans = performing loans + loans in arrears + receivable interests
Net loans to Customers	Gross loans to Customers – Impairments for loans to Customers
Loan-to-deposit ratio (CaixaBank criteria)	(Net loans to Customers - Funding obtained from the EIB, which is used to provide credit) / Deposits and retail bonds
ASSET QUALITY INDICATORS
Impairments and provisions for loans and guarantees (income statement)	Impairment or reversal of impairment on financial assets not measured at fair value through profit or loss relative to loans and advances to Customers and to debt securities issued by Customers (financial assets at amortised cost), before deduction of recoveries of loans previously written off from assets, interest and others + Provisions or reversal of provisions for commitments and guarantees
Cost of credit risk	Impairments and provisions for loans and guarantees - Recoveries of loans previously written off from assets, interest and other
	Cost of credit risk as % of loan portfolio1) (Impairments and provisions for loans and guarantees - Recoveries of loans previously written off from assets, interest and other) / Average value in the period of the gross loans and guarantees portfolio.
Performing loans portfolio	Gross Customer loans - (Overdue loans and interest + Receivable interests and other)
NPE Ratio	Ratio of non-performing exposures (NPE) in accordance with the EBA criteria (prudential perimeter)
Coverage of NPE	[Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments] / Non-performing exposures (NPE)
Coverage of NPE by impairments and associated collaterals	[Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments + Collaterals associated to NPE] / Non-performing exposures (NPE)
Non-performing loans ratio ("credito dudoso", Bank of Spain criteria)	Non performing loans ("credito dudoso", Bank of Spain criteria) / (Gross Customer loans + guarantees)
Non-performing loans coverage ratio	[Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments] / Non performing loans ("credito dudoso", Bank of Spain criteria)
Coverage of non-performing loans by impairments and associated collaterals	[Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments + Collateral associated to credit] / Non performing loans ("credito dudoso", Bank of Spain criteria)
Impairments cover of foreclosed properties	Impairments for real estate received in settlement of defaulting loans / Gross value of real estate received in settlement of defaulting loans

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BANCO BPI, S.A. Registered office: Rua Tenente Valadim, 284, Porto Share capital: € 1 293 063 324.98 Registered at Commercial Registry of Porto under registration number PTIRNMJ 501 214 534 and tax identification number 501 214 534