Banca Ifis

Earnings Release • Nov 9, 2023

9M23 results

9 November 2023

Index

• 1. Appendices
  2. 2.1 Segment results
  3. 2.2 Consolidated financial data
  4. 2.3 Company overview

3Q23 results summary

Net income in 3Q23 of €34mln (vs. €45mln in 2Q23 and €33mln in 3Q22). 9M23 net income at €125mln (+18% YoY) 1

• Loan loss provisions at €15mln, including €6mln on a structured finance position. Total management overlays stable at €65mln 2
• Windfall tax to be allocated to non-distributable reserves (no consideration due) 3
• CET1 at 15.5% (calculated including YTD net income, net of interim/foreseeable dividend) in support of the growth strategy and the solidity of the Bank 4
• €1.2 interim dividend per share to be paid on 22 Nov. 2023 (total €63mln)*.The ex-dividend date is on 20 Nov.23 and the record date on 21 Nov.23 5

*Payout ratio at 50.5%; full-year payout (in line with the new dividend policy approved by the Board of Directors on 3 August 2023) will be computed on the basis of full year results.

Net revenues

Quarterly Revenues

First 9 months Revenues

Stable • Net revenues at €164mln (-5% QoQ due to typical August seasonality and substantially stable YoY)

• 3Q23 net revenues breakdown:
  • o Commercial banking revenues at €84mln (€87mln in 2Q23 and €83mln in 3Q22). Excluding capital gains on direct and indirect PE investments, revenues would be stable QoQ and up +7% YoY*
  • o Npl revenues** prove resilient at €66mln (€67mln in 2Q23 and €66mln in 3Q22) despite inflation and rates scenario
  • o Non Core & G&S at €14mln confirming a recurrent and stable contribution to revenues (€19mln in 2Q23 and €16mln in 3Q22)

* Capital gains on direct and indirect PE investments: €1mln in 3Q23, €3mln in 2Q23 and €5mln in 3Q22

** Includes interest income, cost of funding and certain minor items (i.e. net commission income and the gains on sales of receivables)

Commercial activity reflects market and 3Q typical seasonality

Factoring turnover (€bn) +2% Market -4% Market -14% 3.2 3.4 3.3 3Q22 2Q23 3Q23

• After strong resiliency in previous months, the market is showing some signs of slowdown due to lower invoices and credit demand
• Banca Ifis's growth above market while maintaining underwriting and pricing discipline

• Equipment ad technology: since late August, we saw first evidence of delays in SMEs capex decisions. Banca Ifis reported a growth above the market. The renewal of tax incentives (Sabatini law) may provide some acceleration for leasing in 4Q23
• Automotive: Banca Ifis's strategy (i) premium/luxury segments (not volumes) (ii) price/margin discipline. 3Q23 automotive leasing average spread at 3.92% on top of base rate*, +0.3% up YoY

Npl portfolio performance resilient and well-positioned*

49 45 48 52 52 52 3Q22 2Q23 3Q23 Judicial Extrajudicial 101 44 43 47 ²³26 ²³ 3Q22 2Q23 3Q23 Judicial Extrajudicial 67 69 98 100 70

Revenues from judicial and extrajudicial recovery** (€mln)

• Until 3Q23, modest impact from higher interest rates or inflation on debtors. The bank keeps monitoring new voluntary plans in the light of macroeconomic uncertainty; expected to show macroimpact in coming quarters
• The Bank has continued the sale of tails of NPL portfolios for modest profits (sold GBV of €0.7bn in 3Q23 and €0.7bn in 2Q23)
• Revalea integration costs will be booked upfront in 4Q23

*Source: management accounting data and risk management data

Quarterly cash collection (€mln)

** It includes only interest income, excludes cost of funding and some minor items (i.e. net commission income and the gains on sales of receivables)

Inflation impact countered by efficiency, enabling continued investments in transformation and positioning

Asset quality confirmed and overlay fully expresses Bank's prudence

Loan loss provisions*

• 3Q23 LLP at €15mln includes €6mln provisions on a structured finance position (classified as UTP, under restructuring)

• Asset quality protected by stable overlays at €65mln (>1.2% of EAD)

• Gross and Net Npe Ratio of 4.6% and 2.5% excluding loans in past due vs. Italian public health system

• The application of the New DoD led to the reclassification mainly into past due a total of ca. €101mln loans vs. the Italian public health system (historically, a late payer with limited asset quality risk)

*Figures include "Net provisions for unfunded commitments and guarantees and Profit (loss) from sale of loans measured at amortised cost (excluding Npl Segment)"

No signs of macro credit risks materializing in Banca Ifis's commercial business

Payment days in factoring

1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23

Stage 2 Stage 1

Ratings migration in credit book** Probability of default**

Source: management accounting

*Data refers to €5.4bn customer loans as at 3Q23. Excludes loans at FV, securities, loans vs. banks and others

** Data refer only to customer loans to rated corporate (ca. €4.4bn)

Funding plan to reimburse TLTRO (expiring in Sept 2024) ahead of schedule

€2bn TLTRO (expiring in Sep 2024)

€0.4bn senior bond (expiring in June 24)

Completed management actions Ongoing management actions

• ✓€0.4bn re-marketing of senior leasing securitization notes
• ✓€0.4bn ramp-up of the securitization of an unsecured NPL portfolio created in 2021*
• ✓€0.3bn senior bond issue in September 2023

• ✓€0.7bn proprietary portfolio maturing by Sept. 2024 and not to be reinvested

• ➢ Senior bond issues, subject to market conditions

• ➢ Further increase of retail funding through different channels and maturities
• ➢ > €1bn potential repos with institutional counterparties (using sovereign bonds currently posted at ECB against TLTRO)

Available cash** projected > €1bn post TLTRO repayment (available cash at €1.7bn on 30 Sept 2023, above our target level, due to the issue of a senior bond ahead of plan for prudential reasons)

CET1 actual of 15.53% as at 30 Sep 23, calculated including 9M net income and interim dividend (net of full year foreseeable dividend not paid out yet**)

Key items of CET1 evolution in 3Q23:

• +0.44% due to 9M 2023 net income of €125mln net of either €63mln interim dividend and €12mln foreseeable dividend**
• +0.17% due to RWA decrease mainly attributable to the credit risk component (- €148mln) partially offset by market and CVA risk (€+35mln)

• -0.09% mainly due to increase in OCI negative reserve and in intangible assets

*At group level capital requirements are: CET1 8.65%, Total Capital 12.9% (including 0.75% of P2G)

** The new dividend policy implies €75mln dividends in the first 9M23. Although only €63mln will be paid in Nov 2023, the difference of €12mln is deducted from CET1

Banca Ifis: growing the core business, attractive dividends

2019 2020 2021 2022 2023E

*Dividend based on 2023 guidance presented on 3 August 2023, with €890mln market cap as at 7 Nov 2023

Executing the Business Plan:

• Marginal reliance on extraordinary revenues (PPA) or non recurring items
• Capex and opex to ensure operational excellence and make the Bank future-proof
• 2023 guidance of €160mln (2024 target to be achieved 1Y in advance)

New dividend policy:

Actual net income - PPA

• Potential total dividends of €110mln (>€2 per share), of which €63mln (€1.2 per share) interim dividend to be paid on 22 Nov. 2023
• 2023 dividend yield at 12.3%*

Outlook

Macroeconomic scenario in Italy

• ✓ Macroeconomic slowdown, with high interest rates and gradually reducing inflation
• ✓Corporates more cautious on capex and loan demand
• ✓Significantly increased cost of funding across all channels
• ✓No sign of widespread asset quality deterioration, but first anecdotal issues appearing

Banca Ifis

• ✓Focus on running the core business well; maintain investments
• ✓Continued emphasis on short term lending with attractive risk / return ratios (keep the balance sheet short)
• ✓Completed funding requirements ahead of plan to repay TLTRO by Sep. 24
• ✓€65mln management overlay against possible shocks

✓CET1 increasing (ready for Revalea integration)

Quarterly results

> Banca 19	EMARKET SDIR CERTIFIED
---------------	------------------------------

Reclassified Consolidated Income Statement - (€ mln)	2Q23	3Q23	9M22	9M23	1 Includes €8mln dividends and €3mln capital gains
Net interest income	135.2	134.8	392.5	409.5
Net commission income	27.0	24.0	65.2	74.3	on PE investments due to the disposals of some
Trading and other revenues	1 10.5	5.0	31.0	28.6	equity stakes
Total Revenues	172.7	163.9	488.7	512.4
Loan loss provisions	(6.4)	2 (14.5)	(48.9)	(30.9)
Total Revenues - LLP	166.3	149.3	439.8	481.5	Includes €6mln provision on a structured finance 2
Personnel expenses	(40.7)	(40.0)	(111.2)	(120.5)	position
Other administrative expenses	(65.4)	3 (53.1)	(171.5)	(172.4)
Other net income/expenses	1.5	0.4	4.2	4.3	-€7mln QoQ in costs directly linked to Npl recovery
Operating costs	(104.7)	(92.7)	(278.5)	(288.5)	3
Net provisions for risks and charges	4 5.8	5 (6.2)	(4.5)	(6.7)	due to seasonality
Value adjustments of goodwill	-	-	(0.8)	-
Gains (Losses) on disposal of investments	-	-	0.3	-	Released of FITD&SRF provisions booked in 1Q23 4
Pre tax profit	67.5	50.4	156.3	186.2
Taxes	(21.8)	(16.3)	(50.2)	(60.1)	5 Includes €6mln FITD&SRF provisions
Net income - attributable to the Parent company	45.1	33.7	105.5	124.7
Customer loans	10,114	9,908	9,664	9,908
- of which Npl Business	1,476	1,439	1,487	1,439
Total assets	13,352	13,920	12,433	13,920
Total funding	11,142	11,727	10,208	11,727
- of which customer deposits	5,461	5,281	5,240	5,281
- of which TLTRO and LTRO	2,051	2,071	2,019	2,071
Shareholders Equity	1,675	1,705	1,611	1,705

In the above statements, net impairment losses/reversals on receivables of the Npl Segment were reclassified to interest receivable and similar income to the extent to which they represent the operations of this business and are an integral part of the return on the investment. In addition:

• Operating costs exclude "Net allocations to provisions for risks and charges"

• Loan loss provisions include: "Net provisions for unfunded commitments and guarantees"; "Profit (loss) from sale of loans measured at amortised cost (excluding Npl Segment)"

2.1 Segment results

3Q23 Results: P&L break-down by business unit

			Commercial & Corporate banking
Data in € mln	Npl	Factoring	Leasing	Corp. Banking & Lending	Tot. Commercial & Corporate banking	Non core & G&S	Consolidated
Net interest income	62	27	13	19	60	13	135
Net commission income	1	17	3	5	24	(1)	24
Trading & other revenues	3	(0)	0	1	1	2	5
Net revenues	66	44	16	24	84	14	164
-Of which PPA	0	0	0	0	0	3	3
Loan loss provisions	0	(4)	(1)	(8)	(14)	(0)	(15)
Operating costs	(45)	(22)	(8)	(9)	(39)	(9)	(93)
Net allocations to provisions for risks and charges	0	(0)	0	(0)	(0)	1 (6)	(6)
Net income	14	12	5	5	21	(1)	34
Net income attributable to non controlling interests							(0)
Net income attributable to the							34
Parent company
Net income (%)	41%	35%	13%	14%	62%	(3%)	100%
Customer Loans	1,439	2,359	1,494	2,367	6,221	2,248 2	9,908
RWA1	1,697	2,275	1,309	1,742	5,327	1,778	8,802
2 Allocated capital	264	353	203	271	827	276	1,367

€6mln FITD&SRF provisions 1

• Breakdown of customer loans in Non Core & G&S 2
  • o G&S: includes €1.7bn of Government bonds at amortized costs
  • o Non Core: includes €0.1bn of performing loans mainly ex Interbanca, €0.1bn retail mortgages and €0.03bn of Npl (former Interbanca + Banca Ifis)

Factoring

Turnover - €bn

Data in €mln	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23	3Q23
Net revenues	40	39	44	48	43	44	44
Net revenues / avg. customer loans	5.7%	5.7%	6.8%	7.4%	6.6%	7.0%	7.1%	2
Loan loss provisions*	(9)	(1)	(4)	(0)	(3)	1	(4)

• Loan loss provisions include:
• "Net provisions for unfunded commitments and guarantees";
• "Profit (loss) from sale of loans measured at amortised cost (excluding Npl Segment)"
• 3Q23 factoring turnover +2% YoY above market (- 4% YoY) while maintaining price and underwriting discipline
• Net revenues / average customer loans at 7.1%, reflecting Banca Ifis discipline on margins 2

Leasing

New business - €mln

	127	150	149	221	155	164	1 142
				38
		24	22	101	28	29	24
	24 42	53	54		50	56	54
	61	73	73	82	77	79	64
	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23	3Q23
		Autolease		Equipment		Technology
Net customer loans - €mln	1,378	1,390	1,396	1,472	1,475	1,499	1,494
Data in €mln		1Q22	2Q22 3Q22	4Q22	1Q23	2Q23	3Q23
Net revenues		15	14	14	17	15	15 16
Net revenues /

4.5% 4.0% 3.9% 4.6% 4.2% 4.1% 4.2%

2

3

• New leasing -4% YoY reflecting two different trends:
  • o Equipment ad technology: Banca Ifis's growth was above market. The renewal of tax incentives (Sabatini law) may provide some acceleration for leasing in 4Q23
  • o Automotive: Banca Ifis's strategy (i) premium/luxury segments (not volumes) (ii) price/margin discipline
• Net revenues / average customer loans at 4.2% in 3Q23 2
• Asset quality risk is mitigated by strong sector and borrower diversification and by the remarketing agreements for repossessed assets 3

Loan loss provisions include:

avg customer

loans

Loan loss

• "Net provisions for unfunded commitments and guarantees";

• "Profit (loss) from sale of loans measured at amortised cost (excluding Npl Segment)"

provisions* (1) 1 (2) (1) (1) (1) (1)

Npl Business*: portfolio evolution

Npl portfolio evolution

Key numbers*

• 2.0mln tickets, #1.4mln borrowers
• Extensive portfolio diversification by location, type and age of borrower

Npls acquired in 3Q23: €0bn GBV

• Acquisition of Revalea from Mediobanca. As at 30 September 23, Revalea had a portfolio of unsecured small ticket NPLs of €6.5bn in terms of GBV (NBV of €232mln)
• Banca Ifis achieved the NPL purchase targets of the 2022-24 Business Plan 1Y in advance, allowing for rigorous selectivity going forward
• Revalea transaction completed on 31 Oct 2023

Npls disposals and others in 3Q23: €0.8bn GBV

• The disposals generated a capital gain of €2.9mln. "Others" includes cash collection on the existing portfolio

Npl Business*: ERC

ERC: €2.7bn

2.5

ERC breakdown

Data in €bn	GBV	NBV	ERC
Waiting for workout - At cost	0.3	0.0	0.1
Extrajudicial positions	13.6	0.5	0.8
Judicial positions	7.3	0.9	1.9
Total	21.2	1.4	2.7

ERC assumptions

• ERC based on proprietary statistical models built using internal historical data series and homogeneous clusters of borrowers
  • o Type of borrower, location, age, amount due, employment status
  • o Time frame of recovery
  • o Probability of decay
• ERC represents Banca Ifis's expectation in terms of gross cash recovery. Internal and external costs of positions in nonjudicial payment plans (GBV of €0.5bn in 3Q23), court injunctions ["precetto"] issued and order of assignments (GBV of €2.0bn in 3Q23) have already been expensed in P&L
• €2.4bn cash recovery (including proceeds from disposals) was generated in the years 2014 –3Q2023

Npl Business*: GBV and cash recovery

Judicial recovery

Judicial recovery (€ mln)	GBV	%	To be processed
Frozen	1,572	21%
Court injunctions ["precetto"] and foreclosures	1,119	15%
Order of assignments	862	12%
Secured and Corporate	3,776	52%
Total	7,328	100%

Non judicial recovery – Voluntary plans

Judicial recovery – Order of Assignments

Actual vs. model cash repayments

Judicial + non judicial recovery, data in €mln

jan-21

feb-21

mar-21

apr-21

may-21

jun-21

jul-21

aug-21

sep-21

oct-21

nov-21

dec-21

jan-22

feb-22

mar-22

apr-22

may-22

jun-22

jul-22

aug-22

sep-22

oct-22

nov-22

dec-22

jan-23

feb-23

mar-23

apr-23

may-23

jun-23

jul-23

aug-23

sep-23

In 2Q22 cash collections in secured and corporate were impacted by longer auction timeframes due to court shutdown in 2020-21

Cash collection 1

• Npl cash collection at €100mln despite persistent high inflation
• As planned in the 3Y Business Plan, the Bank is expecting a slight increase of settlements ("saldi e stralci") to reduce timeframe of collections

Data in € mln (excluding disposals)	1Q21	2Q21	3Q21	4Q21	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23	3Q23	2021 YE	2022 YE
Cash collection	81	89	82	94	91	91	101	100	97	98	1 100	345	384
Contribution to P&L**	64	70	66	74	73	71	67	84	73	69	70	273	295
Cash collection / contribution to P&L	127%	128%	124%	127%	125%	128%	152%	120%	134%	141%	142%	127%	130%

*Source: management accounting data

** It includes only interest income, excludes cost of funding and some minor items (i.e. net commission income and the gains on sales of receivables)

Npl Business*: GBV and NBV evolution

GBV - €mln	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23	3Q23
Waiting for workout - Positions at cost	3,850	4,193	1,571	1,284	1,096	1,149	286
Extrajudicial positions	11,155	11,379	13,386	14,302	14,196	13,510	13,558
- Ongoing attempt at recovery	10,670	10,896	12,914	13,831	13,720	13,035	13,041
- Non-judicial payment plans	485	483	471	471	476	475	517
Judicial positions	7,245	7,323	7,498	7,478	7,539	7,338	7,328
- Freezed**	1,662	1,715	1,725	1,627	1,708	1,609	1,572
- Court injunctions ["precetto"] issued and foreclosures	818	858	913	978	1,018	1,073	1,119
- Order of assignments	763	786	798	822	838	837	862
- Secured and Corporate	4,002	3,963	4,062	4,051	3,975	3,819	3,776
Total	22,250	22,895	22,455	23,065	22,831	21,996	21,173
NBV - €mln	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23	*** 3Q23
Waiting for workout - Positions at cost	148	159	77	114	86	92	27
Extrajudicial positions	436	438	464	470	468	460	484
- Ongoing attempt at recovery	208	208	237	238	230	222	223
- Non-judicial payment plans	228	230	227	232	238	239
Judicial positions	898	908	929	921	929	913	262 922
- Freezed**	240	235	229	208	211	194	186
- Court injunctions ["precetto"] issued and foreclosures	181	187	200	207	209	216	231
- Order of assignments	320	333	335	346	355	355	359
- Secured and Corporate	157	154	164	160	154	149	146

*Source: management accounting data

**Other Judicial positions

***Does not include customer loans (invoices to be issued) related to Ifis Npl Servicing third parties servicing activities

Npl Business*: P&L and cash evolution

P&L - €mln	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23	3Q23
Waiting for workout - Positions at cost
Extrajudicial positions	29	25	23	22	27	26	23
- Ongoing attempt at recovery	(1)	0	4	1	(1)	0	0
- Non-judicial payment plans	30	24	18	21	28	26	23
Judicial positions	44	47	44	62	46	43	47
- Freezed**	-	-	-	-	-	-	-
- Court injunctions and foreclosures + Order of assignments	41	40	36	54	40	37	38
- Secured and Corporate	2	7	8	8	6	6	9
Total	73	71	67	84	73	69	70

Cash - €mln	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23	3Q23
Waiting for workout - Positions at cost
Extrajudicial positions	49	49	52	51	50	52	52
- Ongoing attempt at recovery	5	6	11	8	6	7	8
- Non-judicial payment plans	44	44	41	43	44	45	44
Judicial positions	42	42	49	49	48	45	48
- Freezed**	-	-	-	-	-	-	-
- Court injunctions and foreclosures + Order of assignments	33	32	35	37	36	34	37
- Secured and Corporate	9	10	14	13	12	11	11
Total	91	91	101	100	97	98	100

*Source: management accounting data **Other Judicial positions

Npl Business*: portfolio diversification

*Source: management accounting data and risk management data (i.e. data refer only to property portfolio)

Breakdown of GBV by type Breakdown of GBV by borrower age

2.2 Consolidated financial data

Customer loans

• 3Q23 customer loans at €9,908mln (-2% QoQ) driven by factoring seasonality (-8% QoQ)
• o Loan demand slightly decreased in the market as corporate are more cautious due to high interest rates
• o Banca Ifis maintained discipline in pricing and underwriting

29

Asset quality – 3Q23

Asset quality (€ mln)

Consolidated ratios	1Q23	2Q23	3Q23
Gross Npe*	6.1%	5.9%	6.1%
Net Npe*	4.1%	3.9%	3.9%

Commercial & Corporate Banking	Gross	Coverage %	Net
Bad loans	101	74%	26
UTPs	159	42%	92
Past dues	125	5%	118
Total Npes	385	39%	236

Non Core & G&S**	Gross	Coverage %	Net
Bad loans	13	52%	6
UTPs	24	35%	16
Past dues	8	36%	5
Total Npes	44	40%	26

• Asset quality ratios in 3Q23

• o Gross Npe Ratio*: 6.1% (5.9% in 2Q23); 4.6% excluding loans in past due vs. Italian public health system
• o Net Npe Ratio*: 3.9% (3.9% in 2Q23); 2.5% excluding loans in past due vs. Italian public health system
• Gross and Net Npe in Commercial & Corporate Banking came in at €385mln (€371mln in 2Q23) and €236mln (€232mln in 2Q23), respectively
• The New Definition of Default led to the reclassification mainly into past due of €101mln loans vs. the Italian public health system

*Includes commercial loans in Commercial Banking, Non Core and G&S. It excludes Npl business and €1.7bn Government bonds at amortized costs in G&S.

** Npes in Non Core & G&S that arose from the acquisition of former Interbanca, in accordance with IFRS 9 are qualified as POCI ("purchased or originated credit-impaired") and are booked net of provisions

Funding

Funding (€mln)

11,112	11,142	11,727
1,060	1,028	1,166
2,035	2,051	2,071
1,477	1,455	1,757
1,449	1,147	1,452
5,091	5,461	5,281
1Q23	2Q23	3Q23
Customer deposits	Bonds Securitization	TLTRO & LTRO Other

	1Q23	2Q23	3Q23
LCR	>800%	>1,000%	>1,200%
NSFR	>100%	>100%	>100%

• Securitizations: €957mln of factoring; €401mln of Banca Credifarma securitizations and €400mln remarketing Senior Notes of auto lease securitization
• New bond issue of €300mln in Sept 2023 with 5Y maturity
• "Other" includes €899mln banking repo with underlying proprietary portfolio
• Average cost of funding at 3.12% in 3Q23 (2.76% in 2Q23)
• Banca Ifis has €2bn TLTRO expiring in Sept. 2024
• MREL at 12.15% of TREA. The requirement of ca. €1.2bn is entirely covered by equity

Interest income and cost of funding evolution

• Positive seasonality in factoring in 2Q and 4Q
• Increase in cost of funding due to increase in alternative investment opportunities (i.e government bonds, term deposits of other banks). Vast majority of assets and liabilities have already repriced
• Proved ability to pass cost of funding increase to clients
• Prudent funding policy impacting profitability
• * Interest income excludes NPL Business, Non Core and Treasury ** Cost of funding peak in 2Q22 is driven by the «Additional Special Period» (TLTRO)

Proprietary portfolio: resilient contribution to P&L

• Long term «fundamental» positioning strongly focused on investment grade bond area/high dividend equity stock coupled with opportunistic trading approach
• Low duration level
• Use of enhancing and hedging strategies coupled with both risk and expected credit loss control
• Strategical use (at around 76% of total assets* in 3Q23) of HTC to reduce proprietary portfolio volatility
• Low RWA density and relevant ECB / funding eligibility

9M23 proprietary portfolio revenues at around €69.5mln, +€29.5mln (+74%) vs. 9M22

• 9M23: €58.2mln interest income + €11.3mln trading/other income (of which €10.6mln dividends)
• 3Q23 portfolio revenues at around €23.4mln

Type of - Data in €mln end of asset at as	Bonds
(*) quarter	Government	Financial	Corporate	Equity	Total
Held collect/amortized to cost	1667	643	97		2408
(FVOCI) Held collect and sell to	464	138	51	102	755
(HTC HTC&S) Total and	2131	781	149	102	3163
Held for trading/Funds		1			3
Total portfolio	2131	782	149	102	3166
of total Percentage	3% 67 ,	24 7% ,	7% 4 ,	3 2% ,	100 0% ,
Held collect/amortized Modified Duration to cost	2 0 ,	2 9 ,	2 3 ,	NA	2 3 ,
(FVOCI) Modified Held collect and sell Duration to	2 5 ,	2 7 ,	2 2 ,	NA	2 5 ,
Modified FVTPL Duration		10 2 ,			10 2 ,
Modified duration - YEARS Average	2 1 ,	2 9 ,	2 3 ,	NA	2 3 ,

(*) Evaluation HTC: amortized cost 33

Evaluation HTCS & HFT/Funds: market value

€0.8bn bond portfolio expiring by Dec. 24

• €0.7bn by Sept. 24, consistent with TLTRO repayment (€0.1bn by Dec 23)
• €0.1bn between Sept 24 and Dec. 24

Reclassified consolidated operating costs*

Banca Ifis employees

Operating costs (€mln)

Personnel expenses (€mln)

*Figures exclude "Net allocations to provisions for risks and charges"

3Q23 operating costs

• HR costs stable QoQ. Cost of personnel expected to increase in coming quarters due to the renewal of the labour contract at national level
• -€11mln QoQ in other operating costs:
  • o -€7mln on NPL legal and recovery costs due to seasonality (court shut down in August)
  • o -€4mln due to FITD&SRF seasonality

Other adm. expenses and other income / expenses (€mln)

2.3 Company overview

Banca Ifis: a long-term track record of sustainable growth Banca Ifis: a long-term track record of sustainable growth

1. Own funds; 2. Increase in the capital levels driven by the acquisition of the former GE Capital Interbanca Group on 30 November 2016, with a gain on bargain purchase of €623.6mln recognized in the income statement and as such included in the Group's post-transaction capital position at 31 December 2016; 3. Average payout ratio within the time period; 4. Excluding gain from the rebalancing of the government bond portfolio from the profit of 2015; 5. Progressive payout ratio, upon exceeding the threshold of earnings necessary to satisfy the Bank's capital requirements. Subject to Bank of Italy's approval. Distribution of 50% of the consolidated net income up to €100mln. Distribution of 100% of the consolidated net income > €100mln; 6. Net-Zero Banking Alliance

Stable shareholders and governance

• La Scogliera provides, as main shareholder, continuity and stability to Banca Ifis
  • o Long term value creation with a strategy focused on creating continuous adequate earnings, self funding superior growth and delivering attractive and steady dividends
  • o Forefront in business and digital innovation
  • o Prudent attitude towards risks but able seize industrial opportunities when they arise (i.e. acquisition of Interbanca, acquisition of Revalea)
• La Scogliera does not have any other material assets and liabilities other than Banca Ifis

Free float: 49.5%*

*Includes private banking, long only funds, hedge funds (limited presence), retails, index linked funds

A Family Bank challenger, but with 40 years track record

Commercial and Corporate Banking NPL

• ► Specialised player for SMEs, with a broad range of credit products (factoring, lending, leasing, and rental)
• ► Market leader in profitable businesses (e.g., SME factoring, Tech Rental, Pharmacies)
• ► "Light" commercial network (without cash services) rooted in the most industrialized areas of the country

• ► Customer interaction based on a high-performance service model and a reputation for efficiency

• ► Investor and servicer specialized in small ticket NPEs, with a distinctive vertically integrated business model

• ► Execution track record with originators, investors, and other servicers, supported by pricing capabilities and proprietary debtors' database
• ► Proven collection strategy with distinctive skip tracing¹ capabilities and internal "legal factory" team

9M23 Results: P&L break-down by business unit

		Commercial & Corporate banking
Data in € mln	Npl	Factoring	Leasing	Corp. Banking & Lending	Tot. Commercial & Corporate banking	Non core & G&S	Consolidated
Net revenues	202	130	46	82	259	51	512
% of total	39%	25%	9%	16%	51%	10%	100%
Loan loss provisions	0	(6)	(3)	(25)	(34)	3	(31)
Operating costs + risks and charges	(137)	(69)	(24)	(27)	(121)	(38)	(295)
Net income	44	37	13	20	71	11	126
Net income attributable to non controlling interests							(1)
Net income attributable to the Parent company							125
Net income (%)	35%	30%	10%	16%	56%	9%	100%
Customer Loans	1,439	2,359	1,494	2,367	6,221	2,248	9,908
RWA1	1,697	2,275	1,309	1,742	5,327	1,778	8,802
2 Allocated capital	264	353	203	271	827	276	1,367

Consistent "core net income" growth, driven by our capabilities, with a low risk profile

Banca Ifis' risk profile

• Structurally protected liquidity position (maturities)
• Marginal contribution of extraordinary revenues
• Diversification
• Fragmentation of exposures and prudent credit policies
• Progressive cost/income reduction through resource reskilling

*Updated 2023 guidance well above 2023 Business Plan target of €137mln ** 2022 actual net income well above 2022 target of €118mln

Banca Ifis's superior risk-return trade-off (1/3)

* Loans mainly related to financial bonds portfolio 5Y (€0.4bn) and residual retail mortgages (€0.1bn).

Banca Ifis's superior risk-return trade-off (2/3)

Factoring	€ bn 2.4	Average Duration in Y 0.21*	Average ticket size €350k*
Leasing	1.3	2.7	€50k auto €70k equipment
Rental	0.2	2.0	€6k
Medium term lending	0.7	3.0	€250k
Loans to pharmacies	0.8	7.5	€400k
Structured finance	0.7	4.0	€12mln
NPLs	1.4	4.0	€12k
Government bonds	1.7	2.5	Government bonds classified as HTC
Other	0.7	-	€0.4bn financial bonds portfolio 5Y €0.1bn retail mortgages

*Excluding factoring to PA, taxed incentives ("superbonus 110%") and VAT credit

Customer loans: >70% of Banca Ifis's customer loan book has a duration shorter than 3Y

Banca Ifis's superior risk-return trade-off (3/3)*

Very limited corporate deposits Customer deposit breakdown

Rendimax deposits: 84% protected by FITD

*Source: management accounting data

** Other deposits include mainly repo vs. financial institutions (€72mln in 3Q23), B.Credifarma retail deposits (€220mln in 3Q23) and ex Aigis deposits (€45mln in 3Q23)

Disclaimer

• This Presentation may contain written and oral "forward-looking statements", which includes all statements that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward-looking statements rely on a number of assumptions, expectations, projections and provisional data concerning future events and are subject to a number of uncertainties and other factors, many of which are outside the control of Banca Ifis (the "Company"). There are a variety of factors that may cause actual results and performance to be materially different from the explicit or implicit contents of any forward-looking statements and thus such forward-looking statements are not a reliable indicator of future performance. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. The information and opinions contained in this Presentation are provided as at the date hereof and are subject to change without notice. Neither this Presentation nor any part of it nor the fact of its distribution may form the basis of, or be relied on or in connection with, any contract or investment decision.
• The information, statements and opinions contained in this Presentation are for information purposes only and do not constitute a public offer under any applicable legislation or an offer to sell or solicitation of an offer to purchase or subscribe for securities or financial instruments or any advice or recommendation with respect to such securities or other financial instruments. None of the securities referred to herein have been, or will be, registered under the U.S. Securities Act of 1933, as amended, or the securities laws of any state or other jurisdiction of the United States or in Australia, Canada or Japan or any other jurisdiction where such an offer or solicitation would be unlawful (the "Other Countries"), and there will be no public offer of any such securities in the United States. This Presentation does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States or the Other Countries.
• Data regarding macroeconomic scenario, Market, PPA, asset quality ratios, cost income ratios, liquidity ratios, cost of funding, proprietary portfolio, segment reporting, business unit breakdown, commercial and corporate loan breakdown are management accounting. Data regarding Npl portfolio and ERC, Npl cash recovery and Npl P&L contribution, Npl GBV and NBV evolution and breakdown, Npl P&L and cash evolution and breakdown are management accounting.
• Massimo Luigi Zanaboni, Manager charged with preparing the financial reports of Banca Ifis S.p.A., pursuant to the provisions of Art. 154 bis, paragraph 2 of Italian Legislative Decree no.58 dated 24 February 1998, declares that the accounting information included into this document corresponds to the related books and accounting records.
• Neither the Company nor any member of Banca Ifis nor any of its or their respective representatives directors or employees accept any liability whatsoever in connection with this Presentation or any of its contents or in relation to any loss arising from its use or from any reliance placed upon it.