Banca Ifis

Investor Presentation • Feb 10, 2022

2021 Preliminary results

10 February 2022

Index

1. 2021 and 4Q 21 results

2. Appendices

• 2.1 Segment results
• 2.2 Consolidated financial data
• 2.3 Focus on DTA regulatory implications
• 2.4 Focus on PPA

2021 and 4Q 21 results

Key deliveries in 2021

• Net income of €101mln, above our guidance of €90-100mn. "Core net income" excluding PPA and real estate capital gains is up +10% vs. 2019 and ca. 6 times vs. 2020 1
• Net revenues of €603mln at record high (+29% YoY, €468mln in 2020) 2
• Net revenues in Commercial and Corporate Banking at €283mln (+16% vs. 2019 and +27% vs. 2020) 3
• NPL cash collection of €345mln at record high (+33% YoY, €259mln in 2020) 4
• NPL purchases of €3.7bn in terms of GBV at record high (€2.7bn in 2020) 5
• CET 1 of 15.4% supporting the growth strategy and the dividend policy of the Bank. The transfer of La Scogliera to Canton Vaud* (CH) is completed. Negative capital effect of consolidation of La Scogliera is "eliminated" as per commitment taken in 2019 by the controlling shareholder 6
• €0.95 dividend per share (vs. €0.47 of 2021) to be paid in May 2022 7
• Moody's assigned Banca Ifis an issue rating of Baa3 (investment grade) with stable outlook 8

Net revenues

• 4Q21 net revenues of €153mln, with strong performance by both NPL (€73mln) and Commercial Banking (€70mln)
• 4Q21 net revenues excluding PPA of €150mln (-1% QoQ and +29% YoY) confirming the Bank's ability to replace PPA with core revenues
• 3Q21 G&S includes €10mln benefit from TLTRO (0.5% due to the achievement of lending thresholds related to "special reference period" of March 2020 - March 2021)

Net revenues (including PPA) breakdown €mln

Npl Commercial & Corporate Banking G&S + Non core

Net revenues excluding PPA €mln

NPL collection at record high

• Npl cash collection at €94mln in 4Q21 and €345mln in 2021, both at record high
• In 2021, Banca Ifis acquired €3.7bn NPLs (GBV) confirming its market leadership in small ticket unsecured NPLs, with a market share of 46% (34% in 2020)
• 2021 review of the potential long-term impact of Covid-19, led to provisions of €18mln (€9mln in 2Q21, €8mln in 3Q21 and €1mln in 4Q21)
• Ifis Npl Servicing team is rated "1-" by Fitch
• In 4Q21, Banca Ifis executed sales of €0.6bn NPL portfolios (GBV) that were already worked out and not strategic for Banca Ifis. The disposal generated a capital gain

Npl cash collection - €mln

Asset quality – 4Q21

7

Asset quality (€ mln)

Consolidated ratios	2Q21	3Q21	4Q21
Gross Npe*	6.4%	6.5%	6.4%
Net Npe*	3.2%	3.4%	3.9%

Commercial & Corporate Banking	Gross	Coverage %	Net
Bad loans	116	74%	30
UTPs	161	44%	91
Past dues	120	5%	113
Total Npes	396	41%	234

Non Core & G&S**	Gross	Coverage %	Net
Bad loans	20	35%	13
UTPs	51	42%	29
Past dues	9	26%	6
Total Npes	80	39%	49

• Asset quality ratios in 4Q21:
  • o Gross Npe Ratio*: 6.4% (6.5% in 3Q21)
  • o Net Npe Ratio*: 3.9% (3.4% in 3Q21)
• Gross and Net Npe in Commercial & Corporate Banking came in at €396mln (376mln in 3Q21) and €234mln (€178mln in 3Q21), respectively
• Past due increases by €64mln QoQ due to the application of the new definition of default for loans vs. NHS, which do not represent a significant asset quality risk
• In 4Q21 loan loss provisions at €15mln, including additional €1mln extra Covid-19 provisions in our NPL portfolio and €7mln for specific older positions
• Npl Business not included in this analysis. Npe ratios calculated excluding Npl Segment and Italian Government Bonds at amortized costs included in customer loans

*Includes commercial loans in Commercial Banking, Non Core and G&S. It excludes Npl business and €1.6bn Government bonds at amortized costs in G&S.

Gross Npes in Commercial and Corporate Banking include ~€85mln factoring past due mainly loans to the NHS (€64mln) which do not represent a significant asset quality risk

** 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

Capital ratios evolution

• CET1 at 15.44% (+3.76% vs. 3Q21)
• +4.56% due to regulatory deconsolidation of La Scogliera (following the transfer to Canton Vaud concluded with the completion of the last administrative act on 28 Jan 22, and with effectiveness as of 27 Dec 21)
• +0.43% due to 2021 net income (net of proposed dividends)
• -1.16% due to growth of RWA (of which ca. 1/3 "peak" end of year factoring exposure growth)
  • -0.22% due to purchase of treasury shares supporting Long Term Incentive Programme
  • Total Capital increased by +4.29% vs. 3Q 21 of which +5.42% due to regulatory deconsolidation of La Scogliera

Quarterly and annual results

(€ mln)	3Q21	4Q21	FY 20	FY21
Net interest income	129.6	125.4	381.7	488.0
Net commission income	22.0	20.4	74.9	83.3
Trading and other revenues	5.0	7.5	11.2	31.3
Net revenues	156.6	153.3	1 467.8	602.5
Loan loss provisions (LLP)	(19.8)	(14.7)	(91.4) 2	(77.2)
Net revenues – LLP	136.8	138.6	376.4	525.4
Personnel expenses	(36.0)	(38.1)	(123.4)	(141.8)
Other administrative expenses	(50.2)	(70.2)	3 (190.8)	(231.8)
Other net income/expenses	(3.2)	0.3	6.2	(1.9)
Operating costs	(89.4)	(107.9)	(308.0)	(375.5)
Goodwill impairment	-	-	(0.7)	-
Gains (Losses) on disposal of investments	-	-	4 24.2	-
Pre tax profit	47.4	30.7	91.9	149.9
Taxes	(15.0)	(9.9)	(22.7)	(47.6)
Net income - attributable to the Parent company	31.9	20.4	68.8	100.6
Customer loans		9,751 10,332	9,135	10,332
- of which Npl Business	1,376	1,524	1,406	1,524
Total assets		12,769 12,978	12,026	12,978
Total funding		10,535 10,787	9,908	10,787
- of which customer deposits	5,730	5,684	5,472	5,684
- of which TLTRO	2,036	2,034	1,995	2,034
Shareholders Equity	1,606	1,624	1,550	1,624

Net revenues benefit from the progressive improvement in in judicial and extrajudicial NPL recovery and in Commercial and Corporate Banking activity 1

3Q21 net revenues include €10mln benefit from TLTRO (0.5% due to the achievement of lending thresholds), related to "special reference period" of March 2020 - March 2021

• €1mln provisions for concluded review of Covid-19 longterm impact on our NPL portfolio and €7mln for certain older positions 2
• €11.5mln one-off legal and advisory costs for the transfer of La Scogliera to Canton Vaud (CH) and +€5mln Npl recovery costs due to seasonality 3

9

Capital gain due to the disposal of real estate in Milan 4

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. For this reason too, apart from the specific operations, the effects of an analysis performed also in response to the Covid-19 pandemic, have been classified amongst value adjustments

4Q21 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	67	22	11	15	47	11	125
Net commission income	2	14	2	3	19	(0)	20
Trading & other revenues	5	(0)	0	4	4	(1)	8
Net revenues	73	36	12	22	70	10	153
-Of which PPA	0	0	0	0	0	3	4
Loan loss provisions	1 (1)	2 (8)	(2)	(3)	(13)	(1)	(15)
Operating costs	(46)	(27)	(6)	(9)	(42)	3 (21)	(108)
Net income	18	1	3	7	11	(8)	21
Net income attributable to non-controlling interests							0.4
Net income attributable to the Parent company							20
Net income (%)	87%	5%	14%	32%	52%	(39)%	100%
Customer Loans	1,524	2,940	1,390	2,197	6,527	4 2,281	10,332
RWA1	2,339	2,501	1,266	1,448	5,215	1,084	8,638
2 Allocated capital	361	386	195	224	805	167	1,333

• €1mln provisions due to ongoing review of Covid-19 long-term impact on our NPL portfolio 1
• Includes €7mln additional for some high vintage positions 2
• €11.5mln one-off legal and advisory costs for the transfer of La Scogliera to Canton Vaud (CH) 3
• Breakdown of customer loans in Non Core & G&S 4
  • o G&S: includes €1.6bn of Italian Government bonds at amortized costs
  • o Non Core: includes €0.1bn of performing loans mainly ex Interbanca, €0.1bn retail mortgages and €0.04bn of Npl (former Interbanca + Banca Ifis)

Appendices 2

2.1 Segment results

Commercial & Corporate Banking loans*

		Loans to customer in 4Q21, €bln	Highlights
Factoring	Factoring to Corporate and SMEs	2.4	 Strong sector and borrower diversification; exposures to debtors (usually medium and large corporates) with high ratings
	Factoring to public administration	0.5	 Limited asset quality risk: uncertainties on payment timeframe to be managed appropriately
Lending	Guaranteed lending	0.7	 Loans to SMEs 80% guaranteed by MCC/State
	Lending to pharmacies	0.9	 Medium-/long-term lending to pharmacies (Credifarma and Farbanca)
Leasing and rental	Leasing to SMEs	1.4	 Strong sector and borrower diversification, with remarketing agreements. €1.2bn financial leasing and €0.2bn operating leasing
Structured Finance	Structured finance to SMEs	0.7	 Private Equity-sponsored lending to ~55 noncyclical corporations. Tactical investments in PE funds (€60mln) and special situations (UTP) (€35mln)
	Total customer loans of Commercial and Corporate Banking	6.5

Factoring*

Turnover - €bn

Data in €mln	1Q20	2Q20	3Q20	4Q20	1Q21	2Q21	3Q21	4Q21
Net revenues	36	33	34	40	34	35	40	36
Net revenues / average customer loans	4.9%	4.6%	4.8%	5.7%	5.2%	5.4%	6.0%	5.3%	1
Loan loss provisions	(5)	(1)	(2)	(23)	2 4	(10)	(4)	(8)

• Factoring net loans +19% QoQ due to seasonality
• Factoring loans of €2.9bn included €0.5bn exposure to the Public Administration
• Net revenues / average customer loans at 5.3% due to more prudent assumptions in pharma and tax credit to reflect long timeframe of collection 1
• In 1Q21, loan loss provisions include a one-off write back due to the update of credit model 2

*Starting from January 2021, Credifarma has been reclassified from Factoring into Corporate Banking and Lending. All 2020 information provided consider this re-allocation.

Leasing

New business - €mln

63 44 3Q21 4Q21 Technology 1,381 1,390
32
59 19
28
150
	94

Data in €mln	1Q20	2Q20	3Q20	4Q20	1Q21	2Q21	3Q21	4Q21
Net revenues	12	13	12	13	14	15	15	12
Net revenues / average customer loans	3.3%	3.7%	3.3%	3.6%	3.9%	4.3%	4.1%	3.6%
Loan loss provisions	(4)	(4)	(7)	0	(4)	(1)	(1)	(2)

• ¹¹⁰ New leasing +6% YoY and +59% QoQ due to seasonality
  • In 4Q21, customer loans came in at €1,390mln (in line QoQ)
  • Net revenues / average customer loans at 3.6% mainly due to one-offs
  • Asset quality risk is mitigated by strong sector and borrower diversification and by the remarketing agreements for repossessed assets
  • Banca Ifis is carefully monitoring the loans that terminated moratoria on 31 Dec 2021(~€129mln, mainly car leasing)

Npl Business*: portfolio evolution

Npl portfolio evolution

Key numbers*

• 2.1mln tickets, #1.5mln borrowers
• Extensive portfolio diversification by location, type and age of borrower

Npls acquired in 4Q: €3.4bn GBV

• In 4Q21, Banca Ifis purchased €3.4bn NPL (GBV) driven by the purchase of €2.8bn (GBV, ca. 300k unsecured small tickets) from Cerberus
• In 2021, Banca Ifis was market leader in small ticket unsecured NPLs with a market share of 46% (34% in 2020)

Npls disposed and others in 4Q

• In 4Q21: disposals of NPL portfolios that were already worked out and not strategic for Banca Ifis. The disposal generated a capital gain

Npl Business*: ERC

ERC: €3.0bn

2.5

ERC breakdown

Data in €mln	GBV	NBV	ERC
Waiting for workout - At cost	3.4	0.1	0.3
Extrajudicial positions	10.8	0.4	0.7
Judicial positions	7.6	0.9	2.0
Total	21.8	1.5	3.0

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 4Q21), court injunctions ["precetto"] issued and order of assignments (GBV of €1.5bn in 4Q21) have already been expensed in P&L
• €1.7bn cash recovery (including proceeds from disposals) was generated in the years 2014 – 4Q2021

Npl Business*: GBV and cash recovery

Judicial recovery

Judicial recovery (€ mln)	GBV	%	To be processed
Frozen**	2,010	26%
Court injunctions ["precetto"] and foreclosures	771	10%
Order of assignments	757	10%
Secured and Corporate	4,080	54%
Total	7,618	100%

Non judicial recovery – Voluntary plans

GBV, data in €mln
352	371	380	403	413	407	398	378	409	434	461	483
1Q19	2Q19	3Q19	4Q19	1Q20	2Q20	3Q20	4Q20	1Q21	2Q21	3Q21	4Q21

Non-judicial payment plans

jan-19 feb-19 mar-19 apr-19 may-19 jun-19 jul-19 aug-19 sep-19 oct 19 nov-19 dec-19 jan-20 feb-20 mar-20 apr-20 may-20 jun-20 jul-20 aug-20 sep-20 oct-20 nov-20 dec-20 jan-21 feb-21 mar-21 apr-21 may-21 jun-21 jul-21 aug-21 sep-21 oct-21 nov-21 dec-21Actual cash repayments Model cash repayments 609 612 638 640 672 677 676 702 ^{736 744 757} 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 ODA GBV, data in €mln Actual vs. model cash repayments Judicial + non judicial recovery, data in €mln Extrajudicial collections model update to reflect higher cash in

Judicial recovery – Order of Assignments

561

Npl Business*: cash recovery and P&L contribution

Cash collection

• NPL cash collection at record high at €94mln. Portfolio proved to be resilient to Covid-19 crisis 1

P&L Contribution

• 4Q 21 P&L contribution benefits from increasing productivity in servicing 2

Data in € mln (escluding disposals)	1Q19	2Q19	3Q19	4Q19	1Q20	2Q20	3Q20	4Q20	1Q21	2Q21	3Q21	4Q21	2018 YE	2019 YE	2020 YE	2021 YE
Cash collection	57	67	59	76	65	52	66	76	81	89	82	1	94 181	258	259	345
Contribution to P&L**	66	60	44	78	50	34	48	50	64	70	66	2	74 238	248	182	273
Cash collection / contribution to P&L	87%	112%	132%	97%	132%	153%	137%	152%	127%	128%	124%	127%	76%	104%	143%	127%

*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*: stock by recovery phase

Cluster	GBV 4Q21 €mln	% total	Average Description time frame**	Accounting valuation	Cash proceeds
Waiting for workout - Positions at cost	3,409	Recently acquired, under analysis to select the 16% best recovery strategy, to be assigned either to extrajudicial or to judicial recovery	6 months	Acquisition cost
Extrajudicial positions	10,804	49%
-Ongoing attempt at recovery	10,321	Managed by internal and external call centres and recovery networks. The purpose is the 47% transformation into voluntary payment plans (or into judicial recovery if conditions arises)	NA	Statistical model (collective valuation)	No
- Non-judicial payment plans	483	Sustainable cash yields agreed with debtors 2% through call centres and collection agents	5 years	Increase in value (P&L), with valuation based on agreed plan, net of historical delinquency rate, discounted at the IRR used for acquisition	Yes
Judicial positions	7,618	35%
- Frozen***	2,010	Judicial process has started; but the court 9% injunction ["precetto"] has not been issued	6-12 months	Acquisition cost	No
- Court injunctions ["precetto"] issued and foreclosures ("pignoramento")	771	4% actions continue to get the order of assignment	Court injunction ["precetto"] already issued; legal 8-12 months	#1 increase in value at court injunction ["precetto"] and #2 increase in value at foreclosure ["Pignoramento"]. Part of the legal costs are expensed in P&L	No
- Order of assignments	757	Enforcement order already issued. The cash 3% repayment plan is decided by the court and starts afterwards	2-4 months	#3 increase in value. The remaining legal costs are expensed in P&L	Yes
- Secured and Corporate	4,080	19%Ongoing execution of real estate collaterals	4 years	Analytical valuation (expected time frame and amount to be recovered)	Yes
Total	21,831	100%

*Source: management accounting data

** Data before Covid-19.

***Other Judicial positions

GBV - €mln 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 Waiting for workout - Positions at cost 2,864 1,598 1,783 1,794 1,440 1,709 1,885 2,140 1,147 107 203 3,409 Extrajudicial positions 9,745 9,862 9,574 10,378 10,619 10,257 10,579 10,273 10,987 11,280 11,657 10,804 - Ongoing attempt at recovery 9,393 9,491 9,194 9,975 10,206 9,850 10,182 9,896 10,578 10,846 11,196 10,321 - Non-judicial payment plans 352 371 380 403 413 407 398 378 409 434 461 483 Judicial positions 4,015 4,913 5,226 5,669 5,720 6,278 6,428 7,374 7,546 7,896 7,183 7,618 - Freezed** 1,822 1,931 2,192 2,521 2,533 2,627 2,518 3,299 3,243 3,644 2,883 2,010 - Court injunctions ["precetto"] issued and foreclosures ⁴⁶⁴487 511 543 571 595 642 713 686 700 727 771 - Order of assignments 561 609 612 639 640 672 677 676 702 736 744 757 - Secured and Corporate 1,167 1,886 1,911 1,965 1,975 2,384 2,590 2,686 2,915 2,816 2,830 4,080 Total 16,624 16,373 16,583 17,841 17,779 18,244 18,893 19,787 19,680 19,282 19,043 21,831 NBV - €mln 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 Waiting for workout - Positions at cost 174 148 160 109 65 96 104 170 112 15 31 136 Extrajudicial positions 306 313 308 356 364 355 353 339 368 393 413 425 - Ongoing attempt at recovery 162 164 154 190 193 184 185 174 188 198 200 202 - Non-judicial payment plans 144 149 154 166 171 171 169 165 180 195 213 223 Judicial positions 643 711 720 813 840 854 867 894 916 961 930 917 - Freezed** 205 207 215 274 298 304 292 296 300 330 295 271 - Court injunctions ["precetto"] issued and foreclosures 118 118 118 128 120 132 148 160 162 161 166 172 - Order of assignments 227 244 245 259 270 265 264 280 292 305 306 310 - Secured and Corporate 94 142 142 152 152 153 162 158 162 165 163 164 Total 1,123 1,172 1,188 1,278 1,269 1,305 1,324 1,404 1,396 1,369 1,375 1,478 Npl Business*: GBV and NBV evolution *** 1 2

1 The decrease in GBV of waiting for workout/positions at costs is due the beginning of the workout of a few large portfolios acquired in 2020

Acquisition of €3.4bn GVB in 4Q21 2

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

^*Source: management accounting data **Other Judicial positions

Npl Business*: P&L and cash evolution

P&L - €mln	1Q19	2Q19	3Q19	4Q19	1Q20	2Q20	3Q20	4Q20	1Q21	2Q21	3Q21	4Q21
Waiting for workout - Positions at cost
Extrajudicial positions	19	19	19	20	17	10	11	7	22	29	30	38
- Ongoing attempt at recovery	(3)	(2)	(1)	4	(4)	(3)	(5)	(5)	(2)	6	(2)	6
- Non-judicial payment plans	22	21	20	17	21	13	15	12	24	23	32	33
Judicial positions	46	42	26	58	33	24	37	43	42	41	36	35
- Freezed**	0	0	0	0	0	0	0	0	0	0	0	0
- Court injunctions and foreclosures + Order of assignments	37	28	18	40	26	24	32	43	36	34	30	32
- Secured and Corporate	9	14	7	18	6	0	6	0	5	7	5	3
Total	66	60	44	78	50	34	48	50	64	70	66	74

Cash - €mln	1Q19	2Q19	3Q19	4Q19	1Q20	2Q20	3Q20	4Q20	1Q21	2Q21	3Q21	4Q21
Waiting for workout - Positions at cost
Extrajudicial positions	27	32	27	38	30	23	33	37	42	47	43	51
- Ongoing attempt at recovery	4	6	4	10	4	3	4	6	6	9	5	6
- Non-judicial payment plans	23	26	23	28	26	20	29	31	36	39	38	46
Judicial positions	30	35	32	38	35	29	33	40	39	42	39	42
- Freezed**	0	0	0	0	0	0	0	0	0	0	0	0
- Court injunctions and foreclosures + Order of assignments	24	25	25	27	29	23	26	29	30	30	31	32
- Secured and Corporate	6	11	7	11	7	5	7	11	9	12	7	11
Total	57	67	59	76	65	52	66	76	81	89	82	94

Npl Business*: portfolio diversification

Consumer 38% Banking 60% Other

Breakdown of GBV by type Breakdown of GBV by borrower age

Breakdown of GBV by ticket size Breakdown of GBV by region

2.2 Consolidated financial data

Customer loans*

*Starting from January 2021, Credifarma has been reclassified from Factoring into Corporate Banking and Lending. All 2020 information provided consider this re-allocation.

• 4Q21 customer loans at €10,332 (+6% vs 3Q21)
• Factoring increase (+19% QoQ) is driven by seasonality and economic recovery
• Npl increase (+11% QoQ) is driven by the purchase of NPLs
• G&S includes €1.6bn of Italian government bonds and €0.3bn of financial bonds held to maturity

Funding

Funding (€mln)

	2Q21	3Q21	4Q21
LCR	>1,700%	>1,500%	>900%
NSFR	>100%	>100%	>100%

• Customer deposits -0.8% QoQ
• Securitizations include €1,058mln of the factoring securitization and €390mln coming from restructuring of the Farbanca securitization
• Banca Ifis has €2.0bn TLTRO expiring in September 2024 out of a maximum capacity of ca. €2.9bn
• Average cost of funding at 0.84% in 4Q21 vs 0.84% in 3Q21, vs 0.96% in 2Q21, vs 1.02% in 1Q21 and 1.01% in 4Q20
• Moody's assigned Banca Ifis an issue rating of Baa3 (investment grade) with stable outlook

Proprietary portfolio*

Strategy

• Long term «fundamental» positioning strongly focused on investment grade bond area coupled with opportunistic trading approach
• Efficient management of excess cash (ECB deposits) / Low Duration level
• Use of enhancing and hedging strategies coupled with both risk and expected credit loss control
• Low cumulative RWA level and relevant ECB / funding eligibility
• Stable and cross-year recurrent sources of revenues in a low risk investment framework

2021 (4Q21) results

• In 2021 (4Q21), the proprietary portfolio reported a net revenues of €30.3mln (€6.5mln) of which ~ €18.7mln (€5.8mln) as interest rate margin and €11.6mln (€0.7mln) as trading and other income (+€15.4mln increase vs. 2020)
• Dividend flow related to proprietary equity portfolio weighs for ~ €7.1mln booked in trading and other income

Banca Ifis adopted the mechanism offsetting unrealized gains/losses measured through the FVOCI method on government assets

of in €mln end of Type - Data asset at as		Bonds				Total
quarter	Government	Financial	Corporate	Equity	Securitization
Held collect/amortized to cost	1664	188	82		151	2085
(FVOCI) Held collect and sell to	470	20	25	90		605
Total (HTC and HTC&S)	2134	208	107	90	151	2690
for Held trading/Funds/Securitization						4
Total portfolio market value at	2134	208	107	90	151	2694
of total Percentage	79 2% ,	7 7% ,	4 0% ,	3 3% ,	5 6% ,	100 0% ,
Held collect/amortized Duration to cost	2 2 ,	3 6 ,	3 9 ,	NA	2	2 4 ,
(FVOCI) Held collect and sell Duration to	2 7 ,	3 1 ,	4 3 ,	NA	-	2 8 ,
(HTC HTC&S) duration and - YEARS Average	2 3 ,	3 5 ,	4	NA	2	2 5 ,

Consolidated operating costs

Operating costs (€mln)

Personnel expenses (€mln)

Banca Ifis employees

4Q21 operating costs ~+€18.5mln vs. 3Q21:

• +€2.1mln QoQ in personnel expenses, mainly due to bonus accruals to personnel
• +€16.4mln QoQ in other operating costs, mainly due to:
  • o €11.5mln one-off legal and advisory costs for the transfer of La Scogliera to Canton Vaud (CH)
  • o €4.8mln NPL recovery costs due to seasonality

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

Seasonality in Npl and PPA and effect of Covid-19

Net interest income in Npls

4Q21 pre tax reversal PPA at €4mln Variability due to reversal of PPA depending on the prepayment / disposal of ex-Interbanca's loans

Capital gains from Npl disposal

4Q21 gains at €4mln

2.3 Focus on DTA

Focus on DTA regulatory implications

Convertible DTAs	• DTAs related to write downs of loans convertible into tax credits (under Law 214/2011) • Their recovery is certain regardless of the presence of future taxable income and is defined by fiscal law (range ca. 5%-12% per annum, with full release by 2026) • No time and amount limit in the utilization of converted DTAs • Capital requirements: 100% weight on RWA	Data in €/mln 205.4
DTAs due to tax losses (non - convertible)	• DTAs on losses carried forward (non-convertible) and DTAs on ACE (Allowance for Corporate Equity) deductions can be recovered in subsequent years only if there is positive taxable income • No time limit to the use of fiscal losses against taxable income of subsequent years • Capital requirements: 100% deduction from CET1	25.3
Other non-convertible DTAs	• DTAs generated due to negative valuation reserves and provisions for risks and mln charges (~€39.4 as of 31 Dec 2021) • Capital requirements: deduction from CET1 or weighted in RWA depending on certain thresholds*. For Banca Ifis they would be weighted at 250% but they are partially offset by DTL (~€23.9mln as of 31 Dec 2021)	15.5

*Includes prudentially €5.3mln of DTAs related to Ifis Rental and Ifis Real Estate not included in the Banking Group as not a regulated entity

** As stated by CRR (article 48), these kind of DTAs are subjected to a double threshold mechanism: if their amount is less than 10% of the CET1 Capital, they are weighted at 250%; if their amount added to the total investments in financial sector subjects is less than 17.65% they are weighted. If the amount of DTAs is greater than or the first or the second threshold, the amount in excess is deducted from CET1 Capital. 31

2.4 Focus on PPA

Focus on ex-Interbanca PPA

• In 2016, following the acquisition of former Interbanca, Banca Ifis valued the performing and non performing loans of Interbanca by applying a market discount and a liquidity discount to reflect purchase price
• The purchase price allocation (PPA) is written back with the progressive maturity/the disposal of Interbanca's loans
  • As at 31 Dec 21, the residual amount of pre-tax PPA was €33mln

Net customer loans and PPA - €mln

Net customer loans PPA

PPA reversal in P&L- €mln

1Q20	2Q20	3Q20	4Q20	1Q21	2Q21	3Q21	4Q21	Outstanding 4Q 21
9	11	8	30*	12	4	5	4	33
FY 20: €57mln. o/w: -€2mln Corp. Banking & Lending -€56mln Non Core & G&S			FY 21: €25mln. o/w: -€3mln Corp. Banking & Lending -€22mln Non Core & G&S				4Q 21 Outstanding, o/w: -€1mln Corp. Banking & Lending -€33mln Non Core & G&S

*In 4Q 20, the write back of PPA was mainly driven by loans and Npl disposals and prepayments

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 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 evolution 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
• Mariacristina Taormina, 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.