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NLB

Annual Report (ESEF) Apr 14, 2023

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INDEPENDENT AUDITOR'S REPORT

To the Shareholder: Q1 Nova Liubanska Banka.

Opinion

We have audited the separate and consolidated financial statements of Nova Liubanska Bank (the Bank) and the Group, which comprise the separate and consolidated statement of financial position as at 31 December 2022, and the separate and consolidated statement of profit or loss and other comprehensive income, and the separate and consolidated statement of changes in equity and the separate and consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Bank and the Group as at 31 December 2022, and their financial performance and their cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRS).

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) and Regulation (EU) No 537/2014. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Impairment of Loans

The Group has significant exposure to credit risk, and the assessment of impairment of loans requires significant judgment. We focused on the Group's methodology for calculating expected credit losses (ECL) and the assumptions used in the calculation.

Provisions

The Group has recognized provisions for various legal and regulatory matters. We evaluated the Group's assessment of the likelihood of outflows and the measurement of provisions.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.

For Further Information

For further information, refer to the PD.

Management

We understand that the Group has evaluated the portfolio as of 31 December 2022, with impairments related to loans amounting to EUR 93 million and for the Group EUR 324 million.

Building better working world

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Auditor's Report On OTHER LEGAL AND REGULATORY REQUIREMENTS

We were appointed as auditors of the Bank and Group at the general meeting held on the 5th of June 2021 for the period ended 31 December 2020.

Our opinion is based on the consolidated financial statements prepared in accordance with the applicable financial reporting framework.

We have obtained an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.

The Group's management is responsible for the going concern accounting conditions.

In our opinion, the consolidated financial statements have been prepared in accordance with the Delegated Regulation (EU) 2020/815 of 20/10/2019.

From the matters communicated with those charged with governance, we conclude that there are no significant deficiencies in internal control.

Our responsibility is to express an opinion on these financial statements based on our audit.

We have concluded that the consolidated financial statements are free from material misstatement.

Building better working world

Standard - Board

Code: Elhi; Standard & Board Accounting including 4th Independent

Maintain robust ethical standards, integrity, professional conduct, and quality management accordingly.

Summary

Wom Pollormed

Chin tne Econe

Coordinated financial statements requirements of the Delegated Regulation Guide and obtained understanding of the reasonable assurance engagement.

Conclusion

Forar bccn prepared, maintaining attendance.

The Delegated Regulation

Illul UCu*tt
Sanja Nikasing € Sion Pedvins*
Jnecu Certified auditor Era Vouns d 0 & ERNST & YOUNG

Revizilla; poslovno svetovanje d.0.0. Ljubijana

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