Aareal Bank AG

Investor Presentation • Jun 3, 2024

Conference Call

Q1 2024 results

May 15, 2024

Jochen Klösges (CEO) Marc Hess (CFO)

Agenda

▪ Financial Performance

• Business Development
• Funding, Liquidity & Capital
• Outlook
• Appendix

Financial Performance - Highlights

Successful start to 2024 with strong profit increase

Group operating profit of € 103 mn in Q1/24 (Q1/23: € 62 mn)
Bank (SPF + BDS)			Aareon
e c n e sili e r g n ati r e p o g n o r t S ✓	Operating profit (EBT) of € 92 mn fully in line with full year target of € 250-300 mn	s s e	Profitability significantly increased, adj. EBITDA of € 40 mn (Q1/23: € 18 mn), EBT of € 11 mn (Q1/23: € -34 mn)
	Strong earnings, Total LLPs of € 86 mn including management overlay of € 56 mn	n di a e r et k		Strong growth in recurring revenue (+45%), Recurring revenue 83% of total revenues (Q1/23: 75%)
	NPLs substantially reduced by € >500 mn without further P&L impact	r a m al t pi a C ✓	Meaningful investments in efficiency and M&A (incl. payment transaction JV with the Bank) paying off
	Capital and liquidity positions remain solid		Rule-of-40 confirmed, capital market readiness achieved

Financial Performance - Group Profit & Loss

Strong profit increase

Profit & loss (€ mn)	Q1 '23	Q1 '24	∆ Q1 '24/'23
Net interest income (NII)	222	254	+14%
Net commission income (NCI)	72	86	+19%
Admin expenses	199	147	-26%
Other op. income / expenses1)	2	-4
Pre provision profit	97	189	+95%
Loan loss provision incl. FVPL	35	86	+146%
Operating profit (EBT)	62	103	+66%
Profit after tax	42	73	+74%
RoE after tax	6.4%	8.7%

• NII on a high level, having peaked in Q4/23 as expected
• Strong increase in NCI driven by Aareon
• Substantial management overlay reflected in LLP
• Admin expenses down by 26% after significant investments in 2023 and reduced bank levies
  • ➢ CIR bank2): 32%
• Pre provision profit of € 189 mn (Q1/23: 97 mn)
  • Thereof bank's3) pre provision profit of € 178 mn (Q1/23: € 131 mn) demonstrates strong operating resilience

1) Includes Net derecognition gain or loss, net gain or loss from financial instruments (fvpl), net gain or loss from hedge accounting, net gain or loss from investments accounted for using the equity method, net other operating income/expenses

2) Segment SPF & BDS, excl. bank levy / deposit guaranty scheme

3 3) Segment SPF & BDS

Financial Performance - NII / NCI

1) LTM = Last Twelve Months

On a high level, having peaked in Q4/23 as expected

• Bank (SPF & BDS)
  • NII increased by 18% to € 268 mn (Q1/23: € 228 mn) supported by an increased loan portfolio with good margins and a market leading deposit franchise in a normalised interest rate environment
• Aareon
  • M&A investments and externalisation of third-party

Strong increase driven by Aareon

• Aareon
  • NCI increased to € 90 mn (Q1/23: € 67 mn) supported by fees of € 10 mn from payment transaction JV, established with the bank
  • Recurring revenue1) now represents 83% of total revenues (Q1/23: 75%)
• Bank (SPF & BDS)
  • Slightly negative NCI (€ -2 mn) resulting from above mentioned fees paid to JV, established with Aareon

Financial Performance - Admin expenses / LLP

Q1 Q2 Q3 Q4

^{32 83}

159%

2023 2024

Down by 26% after significant investments in 2023 and reduced bank levies

Bank1)

• Stable at € 83 mn considering bank levies reduced by € 23 mn (Q1/23: € 106 mn incl. € 25 mn bank levies)
• CIR Bank2): 32% (Q1/23: 35%)

Aareon

▪ Down to € 66 mn incl. € 10 mn of new acquisitions in 2023 (Q1/23: € 96 mn incl. € 34 mn investments into efficiency and M&A)

LLP driven by management overlay

• Total LLP of € 86 mn (Q1/23: € 35 mn) includes € 3 mn FVPL (Q1/23: € 3 mn)
  • Thereof € 56 mn management overlay (Q1/23: € 21 mn)
    • − Stage 1/2: € 29 mn
    • − Stage 3: € 27 mn
• Loss allowance (B/S): total management overlay amounts to € 81 mn, up from € 25 mn as of 12/23
• Conservative approach with management overlay recognizing continued uncertainties

1) Segment SPF & BDS

2) Excl. bank levy/deposit guarantee scheme

128

0

100

Agenda

• Financial Performance
• Business Development
• Funding, Liquidity & Capital
• Outlook

▪ Appendix

Segment SPF

Selective new business generation in a challenging market environment with low transaction volume

1) Newly acquired business only

2) Governed by "Green Finance Framework"

7

Segment SPF Well diversified portfolio

1) Performing CREF-portfolio only (exposure)

Segment SPF

Business generation with strict low-risk focus leading to improvements in asset quality metrics

LTV1) by property type

%	12 '20	12 '21	12 '22	12 '23	03 '24
Hotel	62	60	56	54	53
Logistics	56	55	52	55	55
Office	58	58	57	62	62
Retail	61	59	56	58	57

YoD1) by property type

%	12 '20	12 '21	12 '22	12 '23	03 '24
Hotel	3.0	5.0	9.0	10.6	11.4
Logistics	9.2	8.7	9.0	9.3	9.4
Office	8.1	7.6	6.9	7.5	7.3
Retail	8.8	9.1	9.8	11.3	11.4

12%

Segment SPF

NPLs significantly reduced by € >0.5 bn in Q1 without further P&L impact

1) NPE ratio according to EBA Risk Dashboard definition

Segment SPF US office markets still very challenging

• No newly acquired business in Q1, slight increase in performing portfolio driven by some restructured loans
• ~50% of the US office portfolio located in New York, rest largely spread throughout major US cities
• Portfolio concentrating on high quality class A properties in A markets
• Loans are being monitored closely on a regular basis incl. early interaction with borrowers

1) Performing CREF-portfolio only (exposure)

Segment BDS Strong deposit franchise

• Deposit volume above target level of € ~13 bn
• Structurally improving deposit mix by ongoing shift from sight into term deposits
• Segment NII increased vs Q1/23 mainly due normalised interest rate environment
• Segment Commission income (CI) is growing, however, segment NCI reflecting fees (€ 10 mn) paid to already mentioned JV established with Aareon

Segment Aareon

Strong start into the year in terms of revenue and adjusted EBITDA

Note: Numbers not adding up refer to rounding 1) Last Twelve Months

• Sales revenue increased by € 25 mn (+31%)
  • Strong growth in recurring revenue with € +29 mn (+45%)
  • Recurring revenue (LTM¹ ) represents 83% of total revenues (Q1/23: 75%)
• Adj. EBITDA increased by € 22 mn to € 40 mn (+115%) incl. contribution from payment transaction JV with bank
• Adj. EBITDA margin increased to 37% (Q1/23: 22%), operating cash flow further improved
• Major activities:
  • JV with integrated payments specialist First Financial Software GmbH established. Further strengthened by realising synergies and up- and cross-selling
  • Pay portfolio expanded: strategic partnerships with payments solutions providers in the UK and the Netherlands; new product in Spain (TucoBan)
  • Acquisition of Blue-Mountain B.V. (business intelligence solutions provider) in the Netherlands
  • In May Aareon announced a strategic investment in Stonal (France), one of the leading data management platform for real estate owners and investors in Europe

Agenda

• 2023 Financial Performance
• Business Development
• Funding, Liquidity & Capital
• Outlook

▪ Appendix

Well diversified funding mix – reduced capital market activities due to strong deposit franchise

• Solid liquidity ratios
  • NSFR: 117%
  • LCR: 192%1)
• Deposits from housing industry at avg. of € 13.9 bn
• Retail term deposits by cooperating with Raisin further increased to € 3.0 bn (12/23: € 2.6 bn)
  • ~95% with a contractual maturity ≥ 2 years
  • Based on the success in the German market expanded into Austria and the Netherlands in Q1 2024, further countries to come in 2024
• One Benchmark Pfandbrief (€ 0.5 bn) issued in Q1/2024
• Further two Benchmark Pfandbriefe planned for 2024
• One senior non-preferred benchmark planned in 2024 as add. instrument to support credit ratings (e.g. Moody's via LGF)
• No senior preferred capital market funding needs from 2023 until the end of 2025 due to further diversified and optimised funding mix

Strong deposit franchise reduces dependence on capital markets

Deposit base consistently increased

• Total deposit base with three strong pillars significantly increased over time
• Granular and sticky Housing Industry (BDS) deposit structure from ~4,000 clients managing more than 9 mn units
• Retail clients as additional source for term deposit introduced in 2022 anticipating expected decrease of Institutional clients deposits caused by reform of the German deposit protection

1) Average on annual / YtD-basis

2) Initial contractual maturity, min. 9 month

Liquidity & Funding Strong Mortgage Cover Pool and Aaa Rating for Pfandbriefe

As at 31.03.2024

Pfandbriefe funding cornerstone of wholesale issuance

• Cover pool of € 16.6 bn incl. € 0.7 bn substitute assets diversified over 19 countries
• High quality assets: first-class mortgage loans (mortgage-lending-value 55.9%)
• Mortgage-lending-value with high discount from market-value
• Avg. LTV of the mortgage cover pool 34.5%
• Moody´s has calculated a 'Aaa' supporting overcollateralisation ratio of 15.5% on a PV basis
• Over-collateralisation on a PV basis as of 31.03.2024: 23.9%
• High diversification within property types and countries

Capital Solid capital ratios1) further increased

• B4 (phase-in) capital ratios are based on RWA calculation taking the higher-of from Advanced Internal Rating Based Approach (A-IRBA) and B4 Revised Credit Risk Standard Approach (CRSA@50% output floor)
• B4 CET1 (phase-in) ratio in Q1/24 further increased to 19.7% (12/23: 19.4%) due to higher CET1
  • CET1 increase mainly results from retained profits
  • RWA effects from REF portfolio development mainly compensated by increased RWAs from OpRisk
• B4 CET1 (fully phased) ratio at 13.6% (12/23: 13.4%)
• T1-Leverage ratio at 6.6% (12/23: 6.6%)

1) Calculation of quotas assuming a successful application for profit inclusion at the ECB as of Q1 24

2) Based on draft version of the European implementation of Basel IV by the European Commission dated 27 October 2021 (CRR III)

Agenda

• Financial Performance
• Business Development
• Funding, Liquidity & Capital
• Outlook

▪ Appendix

Outlook 2024 Confirmed

1) Subject to FX development

Key takeaways

Successful start to the year in a still challenging environment

Strong earnings power offsets still high loss allowance – proof of operating resilience RoE after tax 8.7%

NPLs reduced by € 500 mn in the first quarter of 2024, as announced; NPE ratio <3%

Foundation built for a strong, sustainable performance of Aareal Bank Group

Appendix Business Development

Segment SPF: CREF portfolio by country

€ 31.8 bn well diversified

1) Performing CREF-portfolio only (exposure)

23

Segment SPF: CREF portfolio by property types

€ 31.8 bn well diversified

Segment SPF

Office markets: European office portfolio has significantly lower LTV than US portfolio with only 3% exceeding LTV of 60%

General structural differences between Europe and US

• Interest rate environment
• Lower vacancy rates in European markets
• Ownership structures in Europe leading to longer investment horizons: willing to downpay debt via new equity injections to preserve their equity positions
• Europe with tighter interest rate hedges
• CRE in Europe generally not financed by different layers of debt leading to lower total LTVs and very limited market for junior and mezz tranches
• Longer commuting time and larger homes in the US, European cities offer more larger mix of attractive areas to live and work

All figures as at 31.12.2023 Note: others incl. countries with a portfolio below € 100 mn 1) Performing CREF-portfolio only (exposure)

Segment SPF

After considerable decline in 2023 market values, additional stress scenarios showing satifactory headroom

• ~50% of the US office portfolio located in New York, rest largely spread throughout major US cities
• Portfolio concentrating on high quality class A properties in A markets
• Loans are being monitored closely on a regular basis 0 - 50%: 72% incl. early interaction with borrowers

Performing portfolio as at end of Q1 stressed with additional 20% market value decline

• Average LTV up to 88% from 71% (see above)
• (Layered) LTV above 100%: 3% (€ ~80 mn)
• (Layered) LTV 80%-100%: 10% (€ ~310 mn)

1) Performing CREF-portfolio only (exposure)

Appendix Funding, Liquidity & Capital

Funding & Liquidity Comfortable liquidity position

1) Other assets includes € 0.1 bn private client portfolio and WIB's € 0.2 bn public sector loans

Treasury portfolio of € 7.5 bn ensures comfortable liquidity buffer

• Strong liquidity profile due to high-rated SSAs and Covered Bond focus
• Asset-swap purchases ensure low interest-rate risk exposure
• Well-balanced maturity profile

As of 31.03.2023 – all numbers refer to nominal amounts 1) Composite Rating

Diversified funding sources and distribution channels

MREL ratios well above regulatory requirements

Senior Preferred have significant protection from subordinated liabilities and own funds

• Ample buffer to MREL requirements
• Senior Preferred remains the predominant senior product, though Senior Non-Preferred remains a key element of the funding strategy
• The rundown remains manageable with a number of long-term liabilities providing significant levels of subordination

• 8% TLOF is the bank's binding MREL requirement, to be met with 100% subordinated liabilities

• 1) 8% TLOF with 100% subordinated debt (i.e. Own Funds and SNP). MREL requirements are only updated once a year

• 2) MREL-eligible Senior Non-Preferred Debt >1Y acc. to contractual maturities
• 31 3) Considering regulatory adjustments
• 4) CET1 assumed to be constant over time
• 5) Senior Preferred, excluding structured unsecured issuances
• 6) Based on nominal amounts

Funding & Liquidity Rating profile

Financial Ratings
Fitch Ratings		Moody's
Issuer default rating (Stable)	BBB	Issuer rating (Negative)	Baa1
Short-term issuer rating	F2	Short-term issuer rating	P-2
Deposit rating	BBB+	Senior preferred	Baa1
Senior preferred	BBB+	Senior non preferred	Baa3
Senior non preferred	BBB	Bank deposit rating	Baa1
Viability rating	BBB	BCA	Ba1
Subordinated debt	BB+	Mortgage Pfandbriefe	Aaa
Additional Tier 1	BB

	ESG-Ratings
MSCI		AA
ISS-ESG		prime (C)
Sustainalytics		Low (20-10)
CDP		Awareness Level B

Financial Ratings

▪ Ratings reflect strong credit profile based on solid capital and liquidity position

ESG-Ratings

Aareal's ESG performance has been rewarded by the rating agencies:

• MSCI: Aareal is in the best 34% of 62 diversified financials
• ISS ESG: Prime Status confirms ESG performance above sector-specific Prime threshold
• Sustainalytics: "Low" risk classification", Rank 244 of 1070 in Sector Banks, 21 of 108 in Thrifts and Mortgages
• MOODY's ESG Solutions: Above sector average results in Environment, Social and Governance

Note: ESG-Ratings and Benchmarks as of 29/04/2024

Funding & Liquidity Aareal Bank`s outstanding Benchmark Transactions

Pfandbriefe, Senior Unsecured and AT1
Product	Ratings1)	Currency	Volume	Maturity 	Coupon	ISIN
Pfandbriefe	Aaa	USD	750,000,000	02/14/25	0.625%	XS2297684842
Pfandbriefe	Aaa	GBP	500,000,000	04/29/25	SONIA + 100bps	XS2337339977
Pfandbriefe	Aaa	EUR	750,000,000	02/01/24	0.125%	DE000AAR0249
Pfandbriefe	Aaa	EUR	500,000,000	07/30/24	0.375%	DE000AAR0207
Pfandbriefe	Aaa	EUR	500,000,000	07/15/25	0.375%	DE000AAR0215
Pfandbriefe	Aaa	EUR	750,000,000	02/13/26	3,125%	DE000AAR0389
Pfandbriefe	Aaa	EUR	500,000,000	05/18/26	3,875%	DE000AAR0397
Pfandbriefe	Aaa	EUR	500,000,000	08/03/26	0.010%	DE000AAR0272
Pfandbriefe	Aaa	EUR	500,000,000	02/01/27	2.250%	DE000AAR0348
Pfandbriefe	Aaa	EUR	500,000,000	07/08/27	0.010%	DE000AAR0256
Pfandbriefe	Aaa	EUR	750,000,000	10/11/27	3.000%	DE000AAR0371
Pfandbriefe	Aaa	EUR	500,000,000	02/01/28	0.010%	DE000AAR0280
Pfandbriefe2)	Aaa	EUR	500,000,000	05/10/28	2.875%	DE000AAR0405
Pfandbriefe	Aaa	EUR	500,000,000	09/15/28	0.010%	DE000AAR0306
Pfandbriefe	Aaa	EUR	750,000,000	02/01/29	1.375%	DE000AAR0330
Pfandbriefe	Aaa	EUR	750,000,000	09/14/29	2.375%	DE000AAR0363
Pfandbriefe	Aaa	EUR	750,000,000	02/01/30	0.125%	DE000AAR0314
Senior Preferred	A- / A3	EUR	500,000,000	04/10/24	0.375%	DE000A2E4CQ2
Senior Preferred green	A- / A3	EUR	500,000,000	07/25/25	4.500%	DE000AAR0355
Senior Preferred	A- / A3	EUR	500,000,000	09/02/26	0.050%	DE000AAR0298
Senior Preferred	A- / A3	EUR	500,000,000	04/07/27	0.050%	DE000AAR0264
Senior Preferred	A- / A3	EUR	750,000,000	11/23/27	0.250%	DE000A289LU4
Senior Preferred green	A- / A3	EUR	500,000,000	04/18/28	0.750%	DE000AAR0322
Additional Tier 1	BB	EUR	300,000,000	PERP_NC_5-1	10.897%	DE000A1TNDK2

1) Pfandbriefe are rated by Moody´s, AT1 by Fitch Ratings and Senior Unsecured by Fitch Ratings and Moody´s

2) Issued in 2024

Liquidity ratios significantly above regulatory requirements

• Substantial buffer in regulatory liquidity ratios (LCR / NSFR) despite strong growth in portfolio and difficult economic and capital markets environment
• On average long-term funds have longer maturities than CRE finance portfolio (~4 years vs ~3 years)
• HQLA: comfortably above € 6 bn

Capital SREP (CET 1) requirements

ESG is fundamental to our business and therefore part of our corporate strategy Supporting our clients on the "Road to Paris"

We are fostering the transition…

• Deep integration of ESG into business, credit, investment, risk and funding strategies
• Comprehensive Green Finance and Green Funding frameworks in place
• Continuously leveraging our Green product portfolio
• Consistently positive ESG-rating results rewarding Aareal's ESG performance
• We are aware of our responsibility for the environment and strive to make a positive contribution to a green future
• Our aim is to integrate ESG considerations into all business decisions
• We are committed to transparency, integrity and continuous improvement and to working together with our clients for a sustainable world

ESG in our daily business

Sustainability at the core of our decisions since Q2 2021

ESG in our lending business ESG in our funding activity

Aareal Bank "Green Finance Framework – Lending" put into place

• Aareal Bank's Green Finance Framework Lending confirmed through a Second Party Opinion (SPO) by Sustainalytics
• Ambition to extend ESG assessment in our day-to-day lending activities
• Explicit customer demand for Aareal Bank's green lending approach identified internationally and interest is high for the new product
• Green lending within a regularly updated framework provided

Aareal Bank "Green Finance Framework – Liabilities" forms basis for Green Bonds

• In addition to the lending framework, Aareal Bank has implemented an accompanying and regularly updated liability-side / use-of-proceeds framework - confirmed through SPO by Sustainalytics - that allows issuance of green financing instruments
• "Green Finance Framework Liabilities" is intended to not only reflect our sustainable lending activities but also our strategic approach towards sustainability
• Bond issuances under this framework invite open discussion and engagement with investors on the progress we have made and, on the path, forward

Continue to enlarge climate transparency in the portfolio

• Portfolio transparency and data accumulation significantly improved for both existing and new lending and to be continued
• Aareal Bank involved in international initiatives to calculate financed emissions (PCAF)

Aareal's 'credible and impactful' Green Finance Framework

Aareal Green Finance Framework (GFF) in place
Green Property Financing: Requirements to qualify as green property (as set out below under "Eligibility criteria") ▪ Meets EU Taxonomy criteria and / or ▪ Certified with an above-average ratings and / or ▪ Classified as nearly zero-energy building (nZEB) / thresholds as defined in Aareal GFF		+	Green Loan Rider: Customer of a Green Loan agrees to Maintaining "Aareal Green Finance Framework" requirements during the term of the loan			Green Loan: Combination of Green property1) ▪ and ▪ Agreement
Eligibility category Eligibility criteria (alternatives)
Green Buildings	1. EU taxonomy compliant: Buildings meet the EU Taxonomy criteria according to the EU Commission Delegated Regulation, Chapter 7.7 "Acquisition and ownership of existing buildings"	▪ ▪ ▪ ▪ ▪ ▪ ▪	2. Green building certification: BREEAM: "Very Good" and above LEED: "Gold" and above DGNB: "Gold" and above Green Star: "5 Stars" and above NABERS: "4.5 Stars" and above HQE: "Excellent" and above Energy Star. "80" or above			3. Energy efficiency: Classified as a nearly zero-energy building (nZEB) and / or property falls below the maximum energy reference values 75 kWh/m² p.a. Residential 140 kWh/m² p.a. Office, Hotel, Retail 65 kWh/m² p.a. Logistics
Energy efficiency upgrades	1. EU taxonomy compliant: Modernisation measures meet the EU Taxonomy criteria acc. EU Commission Delegated Regulation3)			2. Upgrade to Green Building: Completion of the measure brings the property up to the green building standard defined above.		at least 30%.	3. Energy efficiency improvement: Completion of the measure results in an energy efficiency improvement of

1) All buildings within a financing have to qualify as green buildings according to Aareal GFF

2) Partnership for Carbon Accounting Financials

3) Chapter 7.2 "Renovation of existing buildings"

30% of CREF portfolio classified as Green Property Financings

€ 9.5 bn1) (30%) of total CREF portfolio fulfilling Aareal's Green Finance Framework and are classified as "Green Property Financings", thereof

• € 6.0 bn included in green asset pool for underlying of Green bond issues
• € 3.5 bn green property financings not (yet) included

• Portfolio data as at 31.03.2024 ESG Data as at 31.03.2024
• 2) Valid certificate is documented

41

On the "Road to Paris" we are supporting our clients and enhancing our own ambition

Short-term ambition 2024 Mid-term ambition Expansion of Green Financing: + € 1.5 bn additional Green Loans1) Clients + € 0.5 bn green long-term funding in 2024 Successes in 2023 Green Loan volume € 4.8 bn (as per 31.12.2023) € ~6-7 bn total Green Loan volume1) by 2026 Continuously leverage our Green Asset Pool for long-term funding Internal Green Funding volume € 1.0 bn green bonds + € 0.4 bn green CPs (as per 31.12.2023) Publish PCAF report on financed emissions in `24 / Provide further transparency for CREF portfolio Deep ESG integration in business, credit, investment, risk and refinancing strategies and decision making process ESG continues to be part of our Management Board's variable remuneration + additionally, workforce's variable remuneration is partly linked to ESG since 2023 Limiting our own Greenhouse Gas emissions Carbon-neutrality through compensation of our business operations worldwide Further develop ESG products

ESG@Aareal target setting

1) Assuming current Green Finance Framework (vintage 2023)

Consistently positive rating results

Rewarding Aareal's ESG performance

Note: Results and Benchmarks as of 29/04/2024

Appendix ADI of Aareal Bank

Interest payments and ADI of Aareal Bank AG

Available Distributable Items (as of end of the relevant year)

€ mn	31.12. 2020	31.12. 2021	31.12. 2022	31.12. 2023
Net Retained Profit ▪ Net income ▪ Profit carried forward from previous year ▪ Net income attribution to revenue reserves	90 90 - -	96 30 66 -	61 61 - -	391 391 61 -
+ Other revenue reserves after net income attribution	840	840	936	936
Total dividend potential before amount blocked1) =	930	936	997	1.388
./. Dividend amount blocked under section 268 (8) of the German Commercial Code ./. Dividend amount blocked under section 253 (6) of the German Commercial Code	320 43	386 36	466 24	487 6
= Available Distributable Items1)	566	515	507	895
+ Increase by aggregated amount of interest expenses relating to Distributions on Tier 1 Instruments1)	21	20	21	29
= Amount referred to in the relevant paragraphs of the terms and conditions of the respective Notes as being available to cover Interest Payments on the Notes and Distributions on other Tier 1 Instruments1)	588	535	529	924

Appendix Group Results

Aareal Bank Group Results Q1 2024

	01.01.- 31.03.2024	01.01.- 31.03.2023	Change
	€ mn	€ mn
Profit and loss account
Net interest income	254	222	14%
Loss allowance	8 3	3 2	159%
Net commission income	8 6	7 2	19%
Net derecognition gain or loss	3	0
Net gain or loss from financial instruments (fvpl)	-18	-6	200%
Net gain or loss on hedge accounting	8	4	100%
Net gain or loss from investments accounted for using the equity method	-	-
Administrative expenses	147	199	-26%
Net other operating income / expenses	0	1
Operating Profit	103	6 2	66%
Income taxes	3 0	2 0	50%
Consolidated net income	7 3	4 2	74%
Consolidated net income attributable to non-controlling interests	2	-9
Consolidated net income attributable to shareholders of Aareal Bank AG	7 1	5 1	39%
Earnings per share (EpS)
Consolidated net income attributable to shareholders of Aareal Bank AG1)	7 1	5 1	39%
of which: allocated to ordinary shareholders	6 3	4 7	34%
of which: allocated to AT1 investors	8	4	100%
Earnings per ordinary share (in €)2)	1.05	0.78	35%
Earnings per ordinary AT1 unit (in €)3)	0.08	0.04	100%

1) The allocation of earnings is based on the assumption that net interest payable on the AT1 bond is recognised on an accrual basis.

2) Earnings per ordinary share are determined by dividing the earnings allocated to ordinary shareholders of Aareal Bank AG by the weighted average of ordinary shares outstanding during the financial year (59,857,221 shares). Basic earnings per ordinary share correspond to diluted earnings per ordinary share.

3) Earnings per AT1 unit (based on 100,000,000 AT1 units with a notional amount of 3 € each) are determined by dividing the earnings allocated to AT1 investors by the weighted average of AT1 units outstanding during the financial year. Earnings per AT1 unit (basic) correspond to (diluted) earnings per AT1 unit.

46

Aareal Bank Group

Results Q1 2024 by segments

	Bank1) (SPF & BDS)		Aareon		Consolidation/ Reconciliation		Aareal Bank Group
	01.01.- 31.03. 2024	01.01.- 31.03. 2023	01.01.- 31.03. 2024	01.01.- 31.03. 2023	01.01.- 31.03. 2024	01.01.- 31.03. 2023	01.01.- 31.03. 2024	01.01.- 31.03. 2023
€ mn
Net interest income	268	228	-14	-6	0	0	254	222
Loss allowance	8 3	3 2	0	0			8 3	3 2
Net commission income1)	-2	8	9 0	6 7	-2	-3	8 6	7 2
Net derecognition gain or loss	3	0					3	0
Net gain or loss from financial instruments (fvpl)	-18	-6		0			-18	-6
Net gain or loss on hedge accounting	8	4					8	4
Net gain or loss from investments accounted for using the equity method
1) Administrative expenses	8 3	106	6 6	9 6	-2	-3	147	199
Net other operating income / expenses	-1	0	1	1	0	0	0	1
Operating profit	9 2	9 6	1 1	-34	0	0	103	6 2
Income taxes	2 4	2 4	6	-4			3 0	2 0
Consolidated net income	6 8	7 2	5	-30	0	0	7 3	4 2
Allocation of results
Cons. net income attributable to non-controlling interests	0	0	2	-9			2	-9
Cons. net income attributable to shareholders of Aareal Bank AG	6 8	7 2	3	-21	0	0	7 1	5 1

1) Excl. consolidation between SPF and BDS business

Aareal Bank Group

Results Q1 2024 by segments

	Structured Property Financing		Banking & Digital Solutions		A a Aareon r e		Consolidation/ Reconciliation		Aareal Bank Group
	01.01.- 31.03. 2024	01.01.- 31.03. 2023	01.01.- 31.03. 2024	01.01.- 31.03. 2023	01.01.- 31.03. 2024	01.01.- 31.03. 2023	01.01.- 31.03. 2024	01.01.- 31.03. 2023	01.01.- 31.03. 2024	01.01.- 31.03. 2023
€ mn
Net interest income	203	176	6 5	5 2	-14	-6	0	0	254	222
Loss allowance	8 3	3 2	0	0	0	0			8 3	3 2
Net commission income	-1	0	-1	8	9 0	6 7	-2	-3	8 6	7 2
Net derecognition gain or loss	3	0							3	0
Net gain or loss from financial instruments (fvpl)	-17	-6	-1	0		0			-18	-6
Net gain or loss on hedge accounting	8	4							8	4
Net gain or loss from investments
accounted for using the equity method
Administrative expenses	5 9	7 4	2 4	3 2	6 6	9 6	-2	-3	147	199
Net other operating income / expenses	0	0	-1	0	1	1	0	0	0	1
Operating profit	5 4	6 8	3 8	2 8	1 1	-34	0	0	103	6 2
Income taxes	1 2	1 5	1 2	9	6	-4			3 0	2 0
Consolidated net income	4 2	5 3	2 6	1 9	5	-30	0	0	7 3	4 2
Allocation of results
Cons. net income attributable to non-controlling interests	0	0	0	0	2	-9			2	-9
Cons. net income attributable to shareholders of Aareal Bank AG	4 2	5 3	2 6	1 9	3	-21	0	0	7 1	5 1

Aareal Bank Group

Results – quarter by quarter

	Structured Property Financing					Banking & Digital Solutions					Aareon						Consolidation / Reconciliation					Aareal Bank Group
	Q1 '24	Q4	Q3 2023	Q2	Q1	Q1 '24	Q4	Q3 2023	Q2	Q1	Q1 '24	Q4	Q3 2023	Q2	Q1	Q1 '24	Q4	Q3 2023	Q2	Q1	Q1 '24	Q4	Q3	Q2 2023	Q1
€ mn
Net interest income	203	212	199	189	176	65	68	59	59	52	-14	-12	-10	- 8	- 6	0	0	0	0	0	254	268	248	240	222
Loss allow ance	83	179	102	128	32	0	0	0	0	0	0	0	0	0	0						83	179	102	128	32
Net commission income	- 1	0	5	1	0	- 1	9	8	8	8	90	77	70	70	67	- 2	- 4	- 7	- 2	- 3	86	82	76	77	72
Net derecognition gain or loss	3	5	6	12	0																3	5	6	12	0
Net gain / loss from fin. instruments (fvpl)	-17	-13	-17	-35	- 6	- 1	0	0	0	0		0	0	0	0						-18	-13	-17	-35	- 6
Net gain or loss on hedge accounting	8	3	- 2	- 4	4																8	3	- 2	- 4	4
Net gain / loss from investments acc. for using the equity method		1						2														1	2
Administrative expenses	59	58	53	46	74	24	35	23	20	32	66	70	75	79	96	- 2	- 4	- 7	- 2	- 3	147	159	144	143	199
Net other operating income / expenses	0	-11	0	7	0	- 1	- 1	0	- 1	0	1	- 2	1	0	1	0	0	0	0	0	0	-14	1	6	1
Operating profit	54	-40	36	- 4	68	38	41	46	46	28	11	- 7	-14	-17	-34	0	0	0	0	0	103	- 6	68	25	62
Income taxes	12	16	3	10	15	12	12	15	14	9	6	22	4	-15	- 4						30	50	22	9	20
Consolidated net income	42	-56	33	-14	53	26	29	31	32	19	5	-29	-18	- 2	-30	0	0	0	0	0	73	-56	46	16	42
Cons. net income attributable to non controlling interests	0	- 1	0	0	0	0	0	0	0	0	2	- 9	- 4	0	- 9						2	-10	- 4	0	- 9
Cons. net income attributable to ARL shareholders	42	-55	33	-14	53	26	29	31	32	19	3	-20	-14	- 2	-21	0	0	0	0	0	71	-46	50	16	51

Appendix Definitions and contacts

Definitions

= New Business	New business = Newly acquired business + renewals
= Common Equity Tier 1 ratio	CET 1 Risk weighted assets
= CIR	Admin expenses (excl. bank levy, et al.) Net income
= Net income	Net interest income + Net commission income + Net derecognition gain or loss + Net gain or loss from financial instruments (fvpl) + Net gain or loss on hedge accounting + Net gain or loss from investments accounted for using the equity method + Net other operating income / expense
= Net stable funding ratio	Available stable funding Required stable funding
= Liquidity coverage ratio	Total stock of high quality liquid assets Net cash outflows under stress
= Earnings per share	operating profit ./. income taxes ./. income/loss attributable to non controlling interests ./. AT1 coupon Number of ordinary shares
= Yield on Debt	NOI x 100 (Net operating income, 12-months forward looking) (without developments) Outstanding incl. prior/pari-passu loans
= CREF-portfolio	Commercial real estate finance portfolio excl. private client business and WIB's public sector loans
= REF-portfolio	Real estate finance portfolio incl. private client business and WIB's public sector loans
= Exposure (performing)	Maximum [actual commitment (performing) or Outstanding (performing)]

Contacts

Jürgen Junginger

Head of Investor Relations Managing Director Phone: +49 611 348 2636 juergen.junginger@aareal-bank.com

Sebastian Götzken

Director Investor Relations Phone: +49 611 348 3337 sebastian.goetzken@aareal-bank.com

Carsten Schäfer

Director Investor Relations Phone: +49 611 348 3616 carsten.schaefer@aareal-bank.com

Ralf Löwe

Head of Treasury Managing Director Phone: +49 611 348 3001 ralf.loewe@aareal-bank.com

Christopher Linnert

Head of Funding Director Treasury Phone: +49 611 348 3889 christopher.linnert@aareal-bank.com

Sandro Wieandt

Assistant Vice President Treasury Phone: +49 611 348 3883 sandro.wieandt@aareal-bank.com

Disclaimer

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This presentation may contain forward-looking statements. Forward looking statements are statements that are not historical facts; they include statements about Aareal Bank AG's beliefs and expectations and the assumptions underlying them; and they are subject to known and unknown risks and uncertainties, most of them being difficult to predict and generally beyond Aareal Bank AG's control. This could lead to material differences between the actual future results, performance and/or events and those expressed or implied by such statements.

Aareal Bank AG assumes no obligation to update any forward-looking statement or any other information contained herein.

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