EUROBANK ERGASIΑS SERVICES AND HOLDINGS S.A.

ANNUAL FINANCIAL REPORT

FOR THE YEAR ENDED

31 DECEMBER 2020

According to Article 4 of the Law 3556/2007

I. Statements of the members of the Board of Directors (according to the article 4, par. 2 of l. 3556/2007)
ΙΙ. Report of the Directors and Corporate Governance Statement
III Ιndependent Auditor's Report (on the Consolidated Financial Statements)
IV. Consolidated Financial Statements of the Company for the year ended 31 December 2020
V. Ιndependent Auditor's Report (on the Financial Statements of the Company)
VI. Financial Statements οf the Company for the year ended 31 December 2020
VII. Website Address for Information on consolidated non-listed companies of the Company

EUROBANK ERGASIAS SERVICES AND HOLDINGS S.A.

Statements of Members of the Board of Directors (according to the article 4 par. 2 of the Law 3556/2007)

We declare that to the best of our knowledge:

the annual financial statements for the year ended 31 December 2020, which have been prepared in accordance with the applicable accounting standards, present fairly the assets, liabilities, equity and annual results of Eurobank Ergasias Services and Holdings S.A. and the companies included in the consolidation, and
the annual report of the Board of Directors presents fairly the development, the performance and the position of the Eurobank Ergasias Services and Holdings S.A and of the companies included in the consolidation, including the description of the main risks and uncertainties they face.

Athens, 12 April 2021

Georgios P. Zanias I.D. No AI – 414343

CHAIRMAN OF THE BOARD OF DIRECTORS

Fokion C. Karavias I.D. No ΑΙ - 677962

OFFICER

Stavros E. Ioannou I.D. No AH - 105785

CHIEF EXECUTIVE

DEPUTY CHIEF EXECUTIVE OFFICER

The directors present their report together with the financial statements for the year ended 31 December 2020.

General information

On 20 March 2020, the demerger of Eurobank Ergasias S.A. (Demerged Entity) through the banking sector's hive down and its transfer to a new credit institution that has been established under the corporate name "Eurobank S.A." (the Bank) was completed. Following the above, the corporate name of the Demerged Entity has been amended to "Eurobank Ergasias Services and Holdings S.A." (the Company or Eurobank Holdings). The Company holds the 100% of the share capital of the Bank and has maintained activities that are mainly related to the strategic planning of the administration of non-performing loans and the provision ofservicesto the Group companies and third parties(see further information in the section "Corporate Transformation-Hive down").

Financial Results Review and Outlook¹

2020 was a challenging year with the spread of the Covid-19 pandemic worldwide, that posed further uncertainties in the short-term economic prospects of Greece and the other countries in which the Company and its subsidiaries (the Group) have a substantial presence. Despite the adversity, the Group completed successfully its Non Performing Exposure (NPE) reduction acceleration plan, enhanced its pre-provision profitability and supported its clients in the new conditions set since the start of 2020.

As at 31 December 2020 total assets increased by €2.9bn to €67.7bn (Dec. 2019: €64.8bn) with gross customer loans reaching €40.9bn (Dec. 2019: €44.5bn), following the derecognition of a mixed portfolio consisting primarily of NPEs of ca. €7.2bn gross book value (project "Cairo") and investment securities amounting to €8.4bn (Dec. 2019: €8.0bn). Out of the total loan portfolio, €32.8bn has been originated from Greek operations (Dec. 2019: €36.9bn) and €8.1bn from international operations (Dec. 2019: €7.6bn). Business (wholesale and small business) loans stood at €22.3bn (Dec. 2019: €25.5bn) and accounted for 55% of total Group loans, while loans to households reached €15.1bn (Dec. 2019: €17.8bn), of which 77% is the mortgage portfolio and the rest are consumer loans. Finally, the loan portfolio includes €3.5bn senior notes of the Pillar and Cairo securitizations (Dec. 2019: €1.1bn Pillar notes). Group deposits reached €47.3bn (Dec. 2019: €44.8bn) with deposits from Greek operations increasing by €1.8bn to €34.2bn (Dec. 2019: €32.4m), while international operations added €0.7bn totalling €13.1bn (Dec. 2019: €12.4m). As a result, the (net) loan–to–deposit (L/D) ratio further improved to 79.1% for the Group (Dec. 2019: 83.2%) and to 86.6% for Greek operations (Dec. 2019: 92.5%). Since March 2020, the European Central Bank (ECB) has introduced a series of measures such as reduction in rates and relaxed eligibility criteria for the participation in its targeted long term refinancing operations (TLTROs) in order to support the liquidity conditions of the banking system and to facilitate the provision of credit to households and firms. In this context, the Group increased the borrowing from ECB's TLTROs by €6.1bn amounting to €8.0bn as at 31 December 2020 (Dec. 2019: €1.9bn) (note 31 of the consolidated financial statements).

Within a challenging external environment, pre-provision Income (PPI) increased to €1,532m or €1,313m excluding the gain of €219m on disposal of Financial Planning Services S.A. (FPS) in June 2020 (2019: €943m), while core pre-provision income (Core PPI) increased by 4.2% year-on-year to €865m (2019: €830m). Net interest income (NII) receded by 2.0% to €1,349m (2019: €1,377m), carrying the negative effect from the decline in business loan spreads and lower income from NPEs, which are partially offset by the decreased funding cost of Eurosystem and market borrowing as well as reduced clients' deposits rates. Net interest margin (NIM) stood at 2.03% (2019: 2.24%) with the fourth quarter reaching 1.95%. Fees and commissions expanded by 8.6% to €384m (2019: €354m) due to the higher rental income from investment properties, and the increased feesfrom capital marketsrelated activities. Trading and other activitiesrecorded net income of €668m (2019: €113m income), including, a) €219m gain on disposal of FPS, b) €139m gain on the Greek Government Bonds (GGBs) swap transaction with the Public Debt Management Agency (PDMA), and c) €289m gains from investment bonds at FVOCI, net of hedging effect. Operating expenses decreased by 3.6% at a Group level to €869m (2019: €901m) and by 6.0% in Greece to €643m (2019: €684m), mainly due to lower staff costs. The cost to income (C/I) ratio for the Group reached 39.8% (2019: 48.9%), while the international operations C/I ratio stood at 47.6% (2019: 42.2%).

In June 2020, the Group proceeded with the closing of the "Cairo" (sale of 20% of mezzanine/ 50.1% of junior Cairo securitizations' notes) and "Europe" (sale of 80% of Eurobank FPS) transactions, which signalled the completion of the Group's accelerated NPE reduction plan announced in the fourth quarter of 2018. The derecognition of Cairo securitised loans in combination with other actions led to the decline of the Group's NPEs to €5.7bn at the end of 2020 (31 December 2019: €13.0bn) driving the NPE ratio to 14.0% (31 December 2019: 29.2%), while the NPE coverage ratio amounted to 61.9% (31 December 2019: 55.3%). During the year, the NPE formation was negative by €94m (fourth quarter: €34m positive) compared to €0.9bn negative in 2019. The loan provisions(charge) reached €2,081m or €572m excluding the impairment loss of €1,509m on Cairo transaction and corresponded to 1.52% of average net loans (2019: €624m or 1.70%).

¹ Definitions of the selected financial ratios and the source of the financial data are provided in the Appendix.

Furthermore, the Group recognised during the year other impairment losses, restructuring costs and provisions amounting to €348m (2019: €182m), of which a) €160m impairment against the goodwill related to the acquisition of Grivalia in 2019, b) €14m impairment and valuation losses on real estate properties, c) €9m impairment losses on investment bonds mainly attributable to purchase transactions d) €20m provisions for litigations and other operational risk events, e) €137m cost for Voluntary Exit Schemes (VES) and other related costs including the one launched by the Bank in September 2020 for eligible units in Greece offered to employees over a specific age limit and f) €9m other restructuring costs mainly related to the Bank's transformation plan. In addition, on 31 December 2020 the Group assessed an amount of €160m deferred tax asset (DTA) on loan losses as being non-recoverable and reversed it accordingly.

Profit or Loss

Overall, in 2020, the loss attributable to shareholders amounted to €1,213m (2019: €127m gain), asset out in the consolidated income statement on page 2. The adjusted net profit, excluding the loss of the Cairo transaction of €1,508m, the gain (after tax) on FPS disposal of €174m, the write-down of DTA by €160m, the goodwill impairment of €160m and the restructuring costs (after tax) of €103m amounted to €544m (2019: €257m) for the Group, of which €128m (2019: €168m) was related to International business.

Going forward, the Group, despite the adverse developments of the covid-19 pandemic, moves ahead with a new plan for the period 2021-2022, which includes the further reduction of its NPEs and strengthening of its profitability mainly through the following initiatives and actions:

a) Accelerating a new NPE securitization of ca. €3.3bn, which accounting also for the Covid-19 impact, is expected to further reduce the Group's NPE ratio to ca. 9% by the end 2021 and improving substantially the Texasratio to approximately 36% in 2021 from 63% in 2020,
b) Cost of risk decline following the material decrease of NPEs and the mitigation of "cliff effects" post the moratoria expiration,
c) Growth of fee and commission income in a number of fee business segments such as the network activities, bancassurance, credit cards and the rental income from the investment property portfolio,
d) Organic increase of Group's performing loans mainly through accelerating new lending of viable and cooperative clients both in Greece and abroad,
e) Improving the funding structure with increase of deposits, further access to the markets and utilization of Eurosystem financing facilities leading to reduced funding costs,
f) Initiatives for pursuing further operating efficiency and proceeding with further simplification and digitalisation in Greece and abroad,
g) Accelerating the introduction of the Environment, Social and Governance (ESG) criteria in all Group's activities and processes.

Capital adequacy

As at 31 December 2020, the Group's Total Regulatory Capital amounted to €6.6bn (31 Dec 2019: €8.0bn), including the aforementioned net losses of €1,334m related to the transformation plan, and accounted for 16.3% (total CAD) of Risk Weighted Assets (RWA) (Dec. 2019: 19.2%), compared to 2020 CAD Overall Capital Requirements (OCR) ratio of 14.05%² . Respectively, the Common Equity Tier 1 (CET1) stood at 13.9% of RWA (Dec. 2019: 16.7%) compared to 2020 CET1 OCR ratio of 9.24%² . At the same date, the fully loaded CET 1 ratio (based on the full implementation of the Basel III rules in 2025) would be 12.0% (Dec. 2019: 14.6%).

In response to the covid-19 outbreak, on 12 March 2020, the ECB announced a number of measures to ensure that its directly supervised institutions can continue to fulfil their role in funding the real economy. Specifically, banks are allowed, among others, to operate below the level of capital defined by the Pillar 2 Guidance and, without prejudice to the restrictions set out in CRD IV, the Combined Buffer Requirement until at least the end of 2022, as per the latest ECB's communication issued on 28 July 2020. Banks are also allowed to partially use capital instruments that do not qualify as CET1 capital, (i.e. Additional Tier 1 or Tier 2 instruments) to meet the Pillar 2 Requirements (P2R).

Furthermore, on 24 June 2020 the Regulation 2020/873 (CRR quick fix) introduced targeted amendments to the Capital Requirements Regulation (CRR) to encourage banksto continue lending during the covid-19 pandemic, including the extension by two years of the transitional arrangements for IFRS 9 and further relief measures, allowing banks to add back to their regulatory capital any increase in new provisions for expected losses that they recognize in 2020 and 2021 for their financial assets, which have not been defaulted. Accordingly, the relief applied for 2022 is 75%, for 2023 50% and for 2024 25% (note 4 of the consolidated financial statements).

Pursuant to the Regulation (EU) No 575/2013 (CRR), the deferred tax assets (DTAs) that rely on future profitability and exceed certain limits shall be deducted in the calculation of the CET1 capital. This deduction should be applied gradually by 2025. The

² The 'Overall capital requirement (OCR)' is the sum of the total SREP capital requirement (TSCR) and the combined capital buffer requirement.

enactment of the article 27A of Law 4172/2013, as in force, provided for the Greek credit institutions that the eligible DTAs are accounted on a) the losses from the Private Sector Involvement (PSI) and the Greek State Debt Buyback Program and b) on the sum of (i) the unamortized part of the crystallized loan losses from write-offs and disposals, (ii) the accounting debt write-offs and (iii) the remaining accumulated provisions and other losses in general due to credit risk recorded up to 30 June 2015 and can be converted into directly enforceable claims(tax credits) against the Greek State, provided that the Bank's after tax accounting result for the period is a loss. Thislegislative provision enabled the Greek credit institutions, including the Bank, not to deduct the eligible DTAs from CET1 capital but recognise them as a 100% weighted asset, with a positive effect on the capital position. As at 31 December 2020, the Bank's eligible DTAs for conversion to tax credits amounted to €3,691m (Dec.2019: €3,821m).

In addition, according to tax Law 4172/2013, as in force, an annual fee of 1.5% is imposed on the excess amount of DTAs guaranteed by the Greek State, stemming from the difference between the current tax rate for the eligible credit institutions (i.e. 29%) and the tax rate applicable on 30 June 2015 (i.e. 26%). For the year ended 31 December 2020, an amount of €6.4m (Dec.2019: €6,6m) has been recognized in "Other income/ (expenses)" (note 13 to the consolidated financial statements).

A potential change in the regulatory treatment of eligible DTAs as tax credits may have an adverse effect in the Group's capital position.

European Union (EU) – wide stress test

On 12 March 2020, the European Banking Authority (EBA) and the European Central Bank (ECB) decided to postpone the stress test exercisesto 2021 to mitigate the impact of Covid-19 on the EU banking sector and thus allow banksto focus on and ensure continuity of their core operations, including support for their customers. In January 2021, the EBA launched the 2021 EUwide stress test exercise which will provide valuable input for assessing the resilience of the European banking sector, notably its ability to absorb shocks under adverse macroeconomic conditions.

This exercise is coordinated by the EBA in cooperation with the ECB and national authorities, and is conducted according to the EBA's methodology, which was published in November 2020. It is carried out on the basis of year-end 2020 figures and assesses the resilience of EU banks under a common macroeconomic baseline scenario and a common adverse scenario, covering the period of 2021-2023. The baseline scenario for EU countries is based on the projections from the national central banks of December 2020, while the adverse scenario assumes the materialisation of the main financial stability risks that have been identified by the European Systemic Risk Board (ESRB) and which the EU banking sector is exposed to. The adverse scenario also reflects ongoing concerns about the possible evolution of the Covid-19 pandemic coupled with a potentialstrong drop in confidence and is designed to ensure an adequate level of severity across all EU countries. In parallel, the ECB also conducts its own stress test for the banks it directly supervises but that are not included in the EBA-led stress test sample. This exercise is consistent with the EBA's methodology and apply the same scenarios, while also including proportionality elements as suggested by the overall smaller size and lower complexity of these banks. Eurobank Holdings Group participates in the ECB-led stress test.

The results of both stress tests will be used to assess each bank's Pillar 2 capital recommendation ("Guidance") in the context of the Supervisory Review and Evaluation Process (SREP). The stress test process is currently in progress and the results for the EBA stress test are expected by the end of July 2021.

Corporate Transformation-Hive down

In November 2018, the Group announced its transformation plan aiming to enable the former to deal with the challenging non-performing loans (NPEs) reduction targets, achieve a significant balance sheet de-risking and focus on the core banking business. The aforementioned transformation plan included the merger with Grivalia, which was completed in April 2019, and the NPEs reduction Acceleration Plan comprising the steps described below:

a) In June 2019, the Group, through the special purpose financing vehicle (SPV) 'Pillar Finance Designated Activity Company', issued senior, mezzanine and junior notes of total value of ca. €2bn, via a securitization of NPEs, which were fully retained by the Group. In September 2019, the Group sold the 95% of the above-mentioned mezzanine and junior notes to Celidoria S.A.R.L. Upon the completion of the above sale, the Group ceased to control the SPV and derecognized the underlying loan portfolio in its entirety, on the basis that it transferred substantially all the risks and rewards of the underlying loan portfolio's ownership. In addition, the Group recognized the retained notes, i.e. 100% of the senior, 5% of the mezzanine and junior notes, on its balance sheet.
b) In June 2019, the Group, through the special purpose financing vehicles (SPVs) 'Cairo No. 1 Finance Designated Activity Company', 'Cairo No. 2 Finance Designated Activity Company' and 'Cairo No. 3 Finance Designated Activity Company', issued senior (Class A), mezzanine (Class B1 and B2) and junior (Class C1 and C2) notes of total value of ca. €7.5bn, via a securitization of a mixed portfolio consisting primarily of NPEs, which were fully retained by the Group. The control of the

SPVs resides with the majority holder of Class B1. Accordingly, the Group, being the sole holder of the issued notes, controlled the SPVs and continued recognizing the underlying loan portfolio on its balance sheet on the basis that it retained substantially all risks and rewards of its ownership.

c) On 20 March 2020, the demerger of Eurobank Ergasias S.A. through the hive down of the banking sector and the establishment of a new company-credit institution under the corporate name 'Eurobank S.A.' was completed (as detailed in Hive Down section below). At the aforementioned date, Eurobank S.A. assumed, inter alia, 100% of the senior, 5% of the mezzanine and junior notes of the Cairo securitization. The rest of the Cairo notes, i.e. 95% of the mezzanine and junior notes, remained with Eurobank Ergasias S.A.. The transaction had no accounting impact on the Group's consolidated financialstatements. On 23 March 2020, the distinctive title of Eurobank Ergasias was amended to Eurobank Holdings.
d) In December 2019, Eurobank Ergasias S.A. announced that it has entered into binding agreements with doValue S.p.A. for: (i) the sale of 80% of itssubsidiary Eurobank "FPS Loans and Credits Claim Management S.A." transferred to Eurobank S.A as part of the assetstransferred through the hive down process and (ii) the sale of 20% of the mezzanine (representing the 80% of Class B1) and 50.1% of the junior notes of the aforementioned Cairo securitization in exchange for a cash consideration of ca. €14m. In June 2020 the sale was completed.

Upon the sale of 20% of the mezzanine notes, which effectively represents the majority stake of the Class B1 notes, the Group ceased to control the SPVs and the related Cairo real estate companies, i.e. Cairo Estate I Single Member S.A, Cairo Estate II Single Member S.A, Cairo Estate III Single Member S.A. Furthermore, being the holder of 100% of the senior, 80% of the mezzanine and 49.9% of the junior notes, the Group, continued to recognize the underlying loan portfolio on its balance sheet on the basis that it continued to retain substantially all risks and rewards of ownership.

e) On 15 June 2020, Eurobank Holdings, following a decision of the Board of Directors (BoD), proceeded to the contribution of the retained Cairo notes, i.e. 75% of the mezzanine and 44.9% of the junior notes along with an amount of €1.5m in cash to its Cyprus-based subsidiary Mairanus Limited, renamed to 'Cairo Mezz Plc', in exchange for the newly-issued shares of the above mentioned subsidiary. Based on the valuation, according to the provisions of Article 17 of Law 4548/2018, the fair value of the shares received by Eurobank Holdings amounted to €57.5m consisting of the fair value of the contributed Cairo notes of €56m and the cash amount of €1.5m. The abovementioned BoD decision for the contribution of the Cairo notesretained by Eurobank Holdingsinitiated the distribution process and clearly demonstrated Management's commitment to the specific plan for the notes' disposal as the last step to the Group's Corporate Transformation Plan, and eventually the Cairo loan portfolio derecognition from its balance sheet. Accordingly, as at 30 June 2020, the Group proceeded with the re-measurement of the portfolio's expected credit losses in accordance with its accounting policy for the impairment of financial assets and classified as held for sale the underlying loan portfolio in accordance with the provisions of IFRS 5 'Non current assets held for sale and discontinued operations'. The impairment loss of €1,509m recognized in the second quarter of 2020, was based on the fair valuation of the notes retained by the Group as at 30 June 2020.
f) On 7 July 2020, the BoD of Eurobank Holdings proposed to the General Shareholders' Meeting the distribution of Cairo Mezz Plc shares to Eurobank Holding's shareholders through the decrease in kind of its share capital. On 28 July 2020, the General Shareholders' Meeting approved the decrease in kind of Eurobank Holdings' share capital via the decrease of the nominal value of each ordinary share and the distribution to its shareholders of the shares issued by Cairo Mezz Plc with a value corresponding to the value of the share capital decrease, at a ratio of 1 share of Cairo Mezz Plc for every 12 Eurobank Holdings' shares already held. The Ministry of Development & Investments by virtue of its decision 81660/31.07.2020 approved the amendment of article 5 of Eurobank Holdings' Articles of Association. The impact from the distribution of Cairo Mezz Plc shares to Eurobank Holding's shareholders was the reduction by an equal amount of €57.5m of Eurobank Holding's share capital along with the related costs directly attributable to the equity transaction of €0.4m.
g) On 21 September 2020, Eurobank Holdings notified the Athens Stock Exchange Corporate Actions Committee of the aforementioned corporate action and announced that the 23rd of September 2020 was the last trading day during which its shares traded with the right to participate in the distribution of shares issued by Cairo Mezz, while from 24 September 2020 onwards they were traded on the Athens Stock Exchange with the new nominal value and without the right to participate in the aforementioned distribution. In addition, the beneficiaries of the distribution of the shares issued by Cairo Mezz Plc were Eurobank Holding's shareholders registered in the records of the Dematerialised Securities System (DSS) on 25 September 2020 (record date). Accordingly, on 25 September 2020 the Group ceased to control Cairo Mezz Plc and derecognized the underlying loan portfolio, since following (a) the sale of 20% of the mezzanine notes and 50.1% of the junior notes to doValue S.p.A. (refer to point d above) and (b) the distribution of Cairo Mezz Plc shares to its shareholders, transferred substantially the risks and reward of portfolio's ownership and ceased to have control over the

securitized loans, which resides with the Class B1 noteholders. The derecognition of the underlying portfolio resulted in a derecognition gain of €9m which is presented in 'other income/(expenses)'.

Further information related to the ownership distribution of Cairo notes and the total equity impact for the Group following the completion of all steps involved, as described in points (b) to (g) above, is provided in note 44 to the consolidated financial statements.

Hive down

On 28 June 2019, the BoD of Eurobank Ergasias S.A. ("Demerged Entity") decided the initiation of the hive down process of the banking sector of the Demerged Entity and itstransfer to a new company-credit institution that would be established ("the Beneficiary"). On 31 July 2019, the BoD of Eurobank Ergasias S.A. approved the Draft Demerger Deed through the aforementioned hive down and establishment of a new company-credit institution, pursuant to Article 16 of Law 2515/1997 and Articles 57 (3) and 59-74 of Law 4601/2019, as currently in force. In particular, the demerger would involve the hive-down of the banking sector of Eurobank Ergasias S.A., to which the assets and the liabilities are included, as described on the transformation balance sheet of the hived-down sector as at 30 June 2019 ("Transformation Date"). In accordance with the Draft Demerger Deed, Eurobank Ergasias S.A. retained the 95% of the Pillar mezzanine and junior notes which in September 2019 were sold to a third party investor, as well as the participation in Pillar DAC and the related Pillar real estate entity.

On 31 January 2020, the Demerged Entity's Extraordinary General Shareholders' Meeting (EGM) resolved, among others: a) the approval of the aforementioned demerger of Eurobank Ergasias S.A. through the banking sector's hive down and the establishment of a new company-credit institution under the corporate name "Eurobank S.A.", b) the approval of the Draft Demerger Deed as well as the Articles of Association of the Beneficiary, as they were approved by the Demerged Entity's BoD and c) the adjustment of the Articles of Association of the Demerged Entity which would cease to be a credit institution by amending its object and corporate name, as was also approved by its BoD. On 20 March 2020, the demerger of Eurobank Ergasias S.A. through the banking sector's hive down and the establishment of a new company-credit institution ("Demerger") under the corporate name "Eurobank S.A" as well as the Articles of Association of the Beneficiary were approved by virtue of the decision of the Ministry of Development and Investments Number 31847/20.03.2020, which was registered on the same day in the General Commercial Registry. At the aforementioned date: a) the Demerged Entity becomes the shareholder of the Beneficiary by acquiring all the shares issued by the Beneficiary and more specifically 3,683,244,830 common registered shares, of a nominal value of €1.10 each and b) the Beneficiary substitutes the Demerged Entity, by way of universal succession, to all the transferred assets and liabilities, as set out in the transformation balance sheet of the hived down sector as at 30 June 2019 and formed up to 20 March 2020, day of the Demerger's completion. On 23 March 2020, the Articles of Association of the Demerged Entity were amended with the decision of the Ministry of Development and Investments, Number 32403/23.03.2020, which was registered on the same day in the General Commercial Registry. According to article 1 of the Articles of Association, the corporate name and the distinctive title of the Demerged Entity is amended to "Eurobank Ergasias Services and Holdings S.A." and "Eurobank Holdings" respectively. The date of change of the Company's corporate name and distinctive title in the Athens Exchange was set for 24 March 2020.

In accordance with the Demerger Deed, Eurobank Holdings maintained activities and assets that are not related to the main banking activities but are mainly related to the strategic planning of the administration of non-performing loans and the provision of services to the Group companies and third parties. Furthermore, Eurobank Holdings retained the 95% of Cairo mezzanine and junior notes, the preferred securities and the participations in certain subsidiaries including Be Business Exchanges S.A., Cairo DACs Pillar and Cairo real estate entities. In case of any assets or liabilities that would not be possible to be transferred, in the context of the above mentioned Draft Demerger Deed, the Demerged Entity undertakes the obligation to collect or liquidate the assets in accordance with the Beneficiary's instructions whereas the Beneficiary undertakes the obligation to indemnify the Demerged Entity for the settlement of the liabilities including any arising costs or losses. Accordingly, the Beneficiary, receives the remaining assets (including 100% of Cairo senior and 5% of mezzanine and junior notes that were recognized at fair value) and liabilities that constitute the banking sector, by issuing shares to the Demerged entity.

In addition, considering that the obligations of the Demerged Entity arising from the Tier 2 Subordinated Capital Instruments were not transferred to the Beneficiary, the latter pursuant to the terms of the Draft Demerger Deed has explicitly and irrevocably undertaken to fulfil the relevant obligations. In that context, on 20 March 2020, the Beneficiary issued a subordinated instrument of equivalent terms with those of TIER 2 mentioned above, which was fully subscribed by the Demerged Entity (note 44 to the consolidated financial statements).

Response to the impact of the covid-19 crisis

The coronavirus (covid-19) outbreak posed further uncertainties and risks for both the macroeconomic environment and the ability of numerous businesses to operate under the restrictive measures, including lockdowns, adopted to contain the virus expansion. The Group is committed in mitigating risk of business disruption due to Covid-19 imminent threat and through an

established governance framework, an action plan aligned with its strategic goals, as well as the necessary agility, plans and prepares for large-scale outbreaks of dangerous disease that can potentially affect its operations for months and threaten the workforce directly. In this context, the Group has immediately adapted its operational model to address Covid-19 pandemic in order to protect the health and safety of its employees and customers, to ensure the Business Continuity of critical banking operations, to invest further in digitalization promoting actively the utilization of advanced electronic transaction channels and to support its customers, business and households. The main actions/initiatives undertaken by the Group were the following:

1. Customer support measures

During the pandemic crisis, the Group has launched a series of initiatives, aiming to actively support its customers (Corporate, Small/Medium enterprises and Individuals).

a. Covid-19 relief measures ('moratoria')

The Covid-19 relief measures provided by the Group to the eligible borrowers are mainly in the form of:
- i. arrears capitalization, payment holidays (instalment for Mortgage/Consumer lending portfolios and capital repayment for the Small Business/Wholesale lending portfolios), deferred up to nine months along with the extension of the respective loans' maturity and
- ii. support measuresspecifically addressed to one of the most affected Greek industries hoteling, the main features being the principal payments' deferral up to 31 December 2021, the disbursement of new working capital facilities and the continuation of the financing of the already approved capital investments.

As at 31 December 2020, the approved amount of performing loans (including performing forborne) under moratoria (both active and expired)stands at €5bn for Greece consisting of €1.5bn in Wholesale lending and €3.5bn in Retail lending. For international operations the respective total approved amount stands at €2bn consisting of €1.5bn in Wholesale lending and €0.5bn in Retail lending. In Greece, gross carrying amount of approximately €1bn related to active moratoria expired within the first quarter of 2021 while the majority of the remaining active moratoria expires in second quarter of 2021. In international operations, the majority of active moratoria expired in the first quarter of 2021.

For the Retail lending portfolio in Greece eligible borrowers refer to professionals whose business activity falls into highly affected industry sectors, as determined by the government, and were not more than 90 days past due (dpd) at 31 December 2019, as well as individuals who are eligible to the state's subsidy programs due to the pandemic and were in performing status (less than 90 dpd) at 31 March 2020.

For Wholesale lending portfolio in Greece, the measures apply to borrowers with significant activity in the eligible sectors (as per government list for highly affected by the pandemic industry sectors) that were less than 90 dpd at 31 December 2019.

Similarly to the Greek lending portfolios, the relief measures, as those were enacted by the local regulations in the countries in which the Group operates, involve arrears capitalization and payment holidays.

Based on recent banking regulators' and accounting guidance (EBA, ECB, International Accounting Standards Board) Covid-19 relief measuresshould neither be treated asforbearance nor automatically trigger a significant increase in credit risk. Such measures are accounted for as modifications, granted for other than forbearance reasons. As the installments or capital owed are only deferred over a maximum period of up to 9 months or up to 31 December 2021 in case of hoteling, on an interest-bearing basis, no significant impact has arisen upon moratoria's' enactment.

b. Government support measures

In addition to the relief measures provided by the Group (as described above), the government in the countries where the Group operates has initiated various programs, in order to stimulate liquidity and economic activity and to alleviate the consequences of the covid-19 outbreak. Such measures involve the suspension of tax payments and social security contributions, financial compensations for employees from directly affected by the lockdown companies, as well as, government guarantees, co-financing and subsidized interest payments for new disbursements and subsidized installment payments on existing loans, secured with borrowers' primary residence collaterals.

The main programs to be extended to eligible borrowers in Greece include:

i. State participation (of 40% or 5%) on newly disbursed loans granted by the Bank that is zero-interest bearing, accompanied with a government-subsidy for the interest bearing part of the principal (60% or 95% respectively) for the first 2 years (i.e. the sub-program of "Business Financing - Entrepreneurship Fund II (TEPIX II),

ii. State aid in the form of a guarantee for the 80% of the principal and the accrued interest during a period of 90 consecutive days, and
iii. ''Gefyra I'' subsidy program applicable to the Retail lending portfolio for loans secured with prime residence collateral, involving 9-months installments' state subsidy on existing lending exposures. "Gefyra II" subsidy program, applicable to Small Business and Wholesale lending portfolios, will be extended to eligible borrowers within 2021.

As of 31 December 2020, the Bank has been allotted €0.6bn, of which €0.3bn has been utilized under program i) above and €1.4bn, of which €1.1bn utilized, under program ii) above. Additionally, the gross carrying amount of lending exposures under "Gefyra I" program amounts to €1.3bn as at 31 December 2020, mainly relating to Mortgage lending.

In addition, starting from December 2020, the Bank signed an agreement with the European Investment Bank (EIB) for the disbursement of new loansfinanced by EIB as a response to the Covid-19 Crisis. Moreover, on existing lending facilities in the Corporate lending portfolio, a three-month, which was extended subsequently to five-month, government interest subsidy program was initiated, which could be opted in combination with the other Covid-19 relief measures.

As at 31 December 2020, the gross carrying amount of loans under government support measures enacted as a response to Covid-19 pandemic in the countries that the Group operates amounts to €106m in Serbia, €13m in Bulgaria and €18m in Cyprus.

c. Operational capacity

Leveraging on its capabilities, the Group has been proactive and hands-on to addressing all issues at an early stage, and in particular, to adjust its strategy and to improve its operational capacity in order to effectively deal with the increasing credit and operational risk as a result of the pandemic. To this end, the Group has designed and implements a broad set of initiatives covering all major areas. In summary, the Group:

i. Deployed sufficient IT resources and completed additional IT projects in order to enable the uninterrupted access to the Group's IT systems and to ensure the continuous monitoring of the Group's portfolios, to accurately and timely identify and classify customers affected by the pandemic, and to fully comply with regular and ad-hoc regulatory requests,
ii. Developed new policies and guidelines on credit underwriting and credit risk management, taking into account industry-wide relief measures and solutions originated by the Group,
iii. Enhanced and expanded its credit risk monitoring and reporting capabilities to address the specific needs and risks associated with the Covid-19 pandemic. This included, among others, the development of new, comprehensive management reports,
iv. Proceeded with granular portfolio segmentation, enabling the grouping of borrowers with similar characteristics, who require similar treatment. To this extent, special processes and solutions were designed for each segment,
v. Defined a set of emergency relief measures that will apply to specific segments that have been affected by the Covid-19 pandemic crisis. These include moratoria to Households, Professionals and Corporates; Short and Medium/Long term solutions,
vi. Reorganized its operations and staff (Credit Underwriting Sectors and Branch Network) to effectively accommodate the customer applications for the various programs,
vii. Developed capacity plans, which are validated and monitored on a regular basis, for the identification and the early management of borrowers with financial difficulties.

d. Utilization of digital channels and provision of covid-19 focused products and services

The Group proceeded with the strengthening of existing digital channelsinfrastructure to continuously support increasing customer volumes with the relevant provision of new services to its customers:

i. Eurobank customers, through e-Banking and the open banking service Account Aggregation, can have on their computer screen, through a secure interface, the overall picture of the balances, as well as the movements, in deposit accounts and credit cards they maintain in any Greek systemic bank. Furthermore, the Bank started to inform customers' data via e-mail or e-banking without visiting a branch, send to the customer copies of its cash transactions via e-mail, issue of e-banking codes directly with a simple SMS, while implementing e-Statements and e-authorizations.
ii. The launch of the new Eurobank Mobile App service, Cards Control, through which credit card, debit and prepaid cardholders acquire a range of card control and transaction facilitation services.
iii. V-Banking capabilities for Corporate and Personal Banking customers,
iv. A new special telephone line was created to facilitate customers for remote access (Digital Onboarding),
v. Through Digital Sales and Presence, the social media channels and the website eurobank.gr were used as information and customer service centers, responding to a 70% increase in comments / requests. The Bank for the complete and timely information on the measures of Covid-19 created a special section on the website

eurobank.gr, with more than 700 updates for customer service, issues of transactions, alternative networks, security, tips and frequently asked questions.

2. Employees protection measures

In line with authorities' instructions and recommendations, the Group istaking all the required measuresto protect the health and safety of its employees and customers in the first priority. Towards this direction, the following actions have been taken:

a. Prohibition of large meetings and bans on business travel abroad and opting instead, where possible, for teleconferencing or videoconferencing. Conducting digital events with a large number of participants (both internals and externals).
b. Enhancement of remote work capabilities (teleworking) covering over 5,000 users and providing flexibility in decreasing / increasing staff physical presence in the Bank's premises, with all of the Bank's units being fully operational and seamless at all levels. Under the emergency measures, remote access was ensured for around 60% of workers on average, which amountsto up to 80% in some centralservices. Special care is given,since the beginning of the pandemic, to employees belonging to vulnerable groups, through their immediate removal from workplaces and enabling them in many cases to work remotely.
c. At the same time, the reserves model was adopted, both for precautionary reasonsto protect the employees' health, as well as to reduce overcrowding and interaction with customers in the workplace.
d. All buildings were preventively disinfected, staff were provided with all required protective supplies (e.g. masks, disinfectants, etc.) while continuous, intensified and thorough cleaning of workplaces(especially the branch network) was carried out.
e. In order to support all employees, a new Help Line was set up by a specialized team of doctors while the existing Helpline was strengthened, where experienced psychologists offer assistance in all matters that concern employees. Bank covers expenses on Molecular tests, for employees that have visited during their summer leave designated high risk Regions and need to be physically present at Bank premises.

3. Support the Public Health System

Eurobank in line with the national effort to cope with the pandemic crisis proceeded to the donation of healthcare equipment and material to support the Public Health System in the midst of the covid19 pandemic. In particular, Eurobank reached an agreement with the Ministry of Health and proceeded with the supply of hospital equipment and sanitary material at the suggestion of the competent bodies.

International Activities

The Group has a significant presence in four countries apart from Greece. In Cyprus it offers Corporate Banking, Private Banking, International Business Banking, and Shipping services through a network of 8 business centres. In Luxembourg it provides Private Banking and Corporate Banking services. Additionally, the subsidiary bank in Luxembourg operates a branch in London. In Bulgaria and Serbia, it operates in Retail and Corporate Banking, Wealth Management and Investment Banking through a network of 291 branches and business centres.

The Group's International Operations adjusted to the new conditions thus maintaining client base, safeguarding the health of the employees and continue offering high quality services to the clients and invest further in digitalization. Relief measures ('moratoria') were introduced during the pandemic crisis caused by the Covid-19 in the region. The Group's International Operations adopted the relief measures and all the relevant activities were successfully implemented.

Risk management

The Group acknowledges that taking risks is an integral part of its operations in order to achieve its strategic and business objectives. Therefore, the Group's Management has established adequate mechanisms to identify, assess and monitor these risks in a timely manner and evaluates their impact on meeting its corporate objectives.

Due to the fact that the economic, industry, regulatory and operating conditions will continue to change, risk management mechanisms are set in a manner that enables the Group to identify and deal with the risks associated with these changes. The Group's structure, internal processes and existing control mechanisms ensure both the independence principle and the exercise of sufficient supervision.

The Group's Management considers effective risk management as a top priority, as well as a major competitive advantage, for the organization. The Group's Management has allocated adequate means for updating its policies, methods and infrastructure, in order to ensure the Group's compliance with the requirements of the European Central Bank (ECB) and of the Single Resolution Board (SRB), with the guidelines of the European Banking Authority (EBA) and the Basel Committee Banking Supervision (BCBS) as well as with the best international banking practices. The Group implements a well-structured credit approval process, independent credit reviews and effective risk management policies for credit, market, liquidity and

operationalrisk, both in Greece and in each country of itsinternational operations. The risk management policiesimplemented by the Group are reviewed annually.

The Group Risk and Capital Strategy outlines the Group's overall direction regarding risk and capital management issues, risk management mission and objectives, risk definitions, risk management principles, risk appetite framework, risk governance framework, strategic objectives and key management initiatives for the improvement of the risk management framework in place.

The maximum risk that the Group is willing to undertake in order to pursue its strategic objectives is stipulated in an internal document, the Risk Appetite Framework (RAF), and is articulated by means of quantitative and qualitative statements, which also include specific tolerance levels, both in terms of each risk type and overall. The main objectives that determine the risk appetite are complying with the regulatory requirements, safeguarding the Group's ability to smoothly continue its activities, and balancing a strong capital adequacy with high returns on equity. The RAF is communicated within the Group, and shapes itsrisk undertaking and management culture, forming the foundation on which risk policies and risk thresholds are established both overall and per business activity.

The Board Risk Committee (BRC) is a committee of the Board of Directors (BoD) and its task is assisting the BoD to ensure that the Group has a well-defined risk and capital strategy in line with its business plan and an adequate and robust risk appetite framework. The BRC assesses the Group's risk profile, monitors compliance with the approved risk appetite and risk capacity thresholds, and ensures that the Group has developed a risk management framework with appropriate methodologies, modelling tools, data sources and sufficient and competentstaff to identify, assess, monitor and mitigate risks. Moreover, BRC is conferred with certain approval authorities for credit proposals, debt forgiveness and write-offs. The BRC consists of six (6) non-executive directors, meets at least on a monthly basis and reports to the BoD on a quarterly basis and on ad hoc instances if needed.

The Management Risk Committee (MRC) is a management committee established by the Chief Executive Officer (CEO) and operates as an advisory committee to the BRC. The main responsibility of the MRC is to oversee the risk management framework of the Group. Moreover, MRC is conferred with certain approval authorities for credit proposals, debt forgiveness and write-offs. As part of its responsibility, the MRC reports to the BRC on topics related to risk and their management. The MRC ensures that material risks are identified and promptly escalated to the BRC and that the necessary policies and procedures are in place to prudently manage risks and to comply with regulatory requirements. Additionally, the MRC determines appropriate management actions, which are discussed and presented to the Executive Board ('EXBO') for information and submitted to BRC for approval.

The Group's Risk Management General Division is headed by the Group Chief Risk Officer (GCRO), operates independently from the business units and isresponsible for monitoring credit, market, operational and liquidity risks. It consists of the Group Credit General Division (GCGD), the Group Credit Control Sector (GCCS), the Group Credit Risk Capital Adequacy Control Sector (GCRCACS), the Group Model Validation & Governance Sector, the Group Market & Counterparty Risk Sector (GMCRS), the Group Operational Risk Sector (GORS), the Group Strategy Planning and Operations Division, the Supervisory Relations & Resolution Planning Sector (with dual reporting line to the Group Chief Financial Officer) and Risk Analytics Division.

As part of its overall system of internal controls Eurobank Ergasias Services and Holdings SA has engaged in a Service Level Agreement (SLA) with Eurobank S.A. (the Banking subsidiary of the Group) in order to receive supporting and advisory services in all areas of risk management (credit, market, liquidity and operational risks) undertaken by the Group.

The most important types of risk that are addressed by the risk management functions of the Group are:

Credit Risk

The Group is exposed to credit risk, comprising the risk that a counterparty will be unable to fulfil its payment obligations in full, when due. The credit risk arises principally from the wholesale and retail lending activities of the Group, as well as from credit enhancements provided,such asfinancial guarantees and letters of credit and from other activities,such asinvestments in debt securities, trading, capital markets and settlement activities. Taking into account that credit risk is the primary risk the Group is exposed to, it is very closely managed and monitored by specialised risk units, reporting to the GCRO.

The credit review and approval processes are centralised both in Greece and in the International operations following the "four-eyes" principle and specific guidelines stipulated in the Credit Policy Manual and the Risk Appetite Framework. The segregation of duties ensures independence among executives responsible for the customer relationship, the approval process and the loan disbursement, as well asthe loan monitoring during itslifecycle. The credit approval processin Corporate Banking is centralised through the establishment of Credit Committees with escalating Credit Approval Levels, which assess and limit to the extent possible the corporate credit risk. Rating models are used in order to calculate the credit rating of

corporate customers, reflecting the underlying credit risk. The most significant ones are the MRA (Moody's Risk Analyst) applied for companies -mostly- with industrial and commercial activity and the slotting rating models, used for specialised lending portfolios(shipping, real estate and project finance) with ring fenced transactions. Credit risk assessment is performed by Group Credit General Division (GCGD), which assesses the credit requests submitted by the Business Units, a procedure including the evaluation of the operational and financial profile of the customer, the validation of the borrower's rating and the identification of potential risk factors for the Bank.

The credit review and approval processes for loans to Small Businesses (turnover up to €5m) are also centralised following specific guidelines and applying the 'four-eyes' principle. The assessment is primarily based on the analysis of the borrower's operational characteristics and financial position. The same applies for Individual Banking (consumer and mortgage loans), where the credit risk assessment is based on criteria related to the characteristics of the retail portfolio, such as the financial position of the borrower, the payment behaviour, the existence of real estate property and the type and quality of securities.

The ongoing monitoring of the portfolio quality and of any deviations that may arise, lead to an immediate adjustment of the credit policy and procedures, when deemed necessary. The quality of the Group's loan portfolios (business, consumer and mortgage in Greece and abroad) is monitored and assessed by the Group Credit Control Sector (GCCS) via field, desktop and thematic reviews in order to timely identify emerging risks, vulnerabilities, compliance to credit policies and consistency in underwriting. GCCS operates independently from all the business units of the Bank and reports directly to the GCRO.

The measurement, monitoring and reporting of the Group's exposure to counterparty risk, which is the risk of loss due to the customer'sfailure to meet its contractual obligationsin the context of treasury activities,such assecurities, derivatives, repos, reverse repos, interbank placings, etc. are performed by the Group Market and Counterparty Risk Sector (GMCRS). The Group sets limits on the level of counterparty risk that may be undertaken based mainly on the counterparty's credit rating, as provided by international rating agencies, and the product type (e.g. control limits on net open derivative positions by both amount and term, sovereign bonds exposure, asset backed securities). The utilization of the abovementioned limits, any excess of them, as well asthe aggregate exposure per Group's entity, counterparty and product type are monitored by GMCRS on a daily basis.

Market Risk

The Group has exposure to market risk, which is the risk of potential financial loss due to an adverse change in market variables. Changes in interest rates, foreign exchange rates, credit spreads, equity prices and other relevant factors, such as the implied volatilities of the above, can affect the Group's income or the fair value of its financial instruments. The market risksthe Group is exposed to are measured and monitored by GMCRS. GMCRS isresponsible for the measurement, monitoring and reporting of the exposure on market risks including the interest rate risk in the Banking Book (IRRBB) of the Group. The Sector reports to the GCRO.

Market risk in Greece and in International operations is measured and monitored using the Value at Risk (VaR) methodology and sensitivity analysis. VaR is a methodology used in measuring financial risk by estimating the potential negative change in the market value of a portfolio at a given confidence level and over a specified time horizon. The VaR that the Group measures is an estimate based upon a 99% confidence level and a holding period of 1 day and the methodology used for the calculation is Monte Carlo simulation (full re-pricing of each position is applied). Since VaR constitutes an integral part of the Group's market risk control regime, VaR limits have been established for all portfolios (trading and investment) measured at fair value and actual exposure is reviewed daily by management. However, the use of this approach does not prevent losses outside of these limits in the event of extraordinary market movements. For that reason the Group uses additional monitoring metrics such as: Stressed VaR, Expected Shortfall and Stress Tests.

Liquidity Risk

The Group is exposed on a daily basis to liquidity risk due to deposits withdrawals, maturity of medium or long term notes, maturity of secured or unsecured funding (interbank repos and money market takings), collateral revaluation as a result of market movements, loan draw-downs and forfeiture of guarantees. The Board Risk Committee sets liquidity limits to ensure that sufficient funds are available to meet such contingencies. The Group monitors on a continuous basis the level of liquidity risk using regulatory and internal metrics and methodologies (LCR, NSFR, buffer analysis, cash flow analysis, short-term and medium-term stress test etc.).

BRC role is to approve all strategic liquidity risk management decisions and monitor the quantitative and qualitative aspects of liquidity risk. Group Assets and Liabilities Committee (G-ALCO) hasthe mandate to form and implement the liquidity policies and guidelines in conformity with Group's risk appetite, and to review at least monthly the overall liquidity position of the Group. Group Treasury is responsible for the implementation of the Group's liquidity strategy, the daily management of the Group's liquidity and for the preparation and monitoring of the Group's liquidity budget, while GMCRS is responsible for measuring, monitoring and reporting the liquidity of the Group.

Operational Risk

Operational risk is embedded in every business activity undertaken by the Group. The primary aim of operational risk management is to ensure the integrity of the Group's operations and its reputation by mitigating its impact. To manage operational risk more efficiently, the Group operates an Operational Risk Management Framework, which definesits approach to identifying, assessing, monitoring and reporting operational risks.

Governance responsibility for operational risk management stems from the Board of Directors (BoD), through the Executive Board and Senior Management, and passes down to the Heads and staff of every business unit. The BoD establishes the mechanisms used by the Group to manage operational risk, by setting the tone and expectations at top management and delegating relevant responsibility. The Board Risk Committee and the Audit Committee monitor the operational risk level and profile, including the level of operational losses, their frequency and severity.

Eurobank applies the elements of the Three Lines Model for the management of operational risk.

a) Line 1 ‐ Own and manage risk and controls. The front line business and operations are accountable for this responsibility as they own the rewards and are the primary risk generators.
b) Line 2 ‐ Monitor risk and controls in support of Executive Management, providing oversight, challenge, advice and group‐ wide direction through, among others, the Risk and Compliance units.
c) Line 3 ‐ Internal Audit provides independent assurance to the Board and Executive Management concerning the effectiveness of risk and control management.

The Heads of each Business Unit have the primary responsibility for the day-to-day management of operational risk arising in their units and for the adherence to relevant controls. An Operational Risk Unit operates in every subsidiary of the Group, being responsible for applying the Group's operational risk strategy and framework.

Each Business Unit has appointed an Operational Risk Partner (OpRisk Partner) who isresponsible for coordinating the internal operational risk management efforts of the Business Unit while acting as a liaison to Group Operational Risk Sector and the local Operational Risk Unit.

Certain business units have established a dedicated Anti-Fraud Unit or Function, according to the fraud risk to which their operations are exposed. Their main objective is to continuously identify fraud risks and to undertake all appropriate actions in addressing and mitigating those risks in a timely manner.

Further information on the Group's financial risk management objectives and policies, including the policy for hedging each major type of transaction for which hedge accounting is used is set out in the notes 2, 5 and 22 to the consolidated financial statements for the year ended 31 December 2020.

Non Performing Exposures (NPEs) management

A strategic priority for the Group remains the active and effective management of NPEs with the aim to further reduce the NPEsstock in accordance with its operational targets agreed with the supervisory authorities, leveraging the externalstrategic partnership that it has entered into, as described below, and the important legislative changes that have taken or are expected to take place.

Following the completion of corporate transformation (Hive-down) on 20 March 2020 and in accordance with the "Europe" and "Cairo" transactions on 5 June 2020, the Group entered into a strategic partnership with doValue S.p.A. for the management of its NPEs, the majority of which are included in the securitized portfolio of entity ERB Recovery Designated Activity Company (DAC). In particular, the Group assigned the management of its remaining NPE portfolio, retail early arrears and any future assets in the aforementioned perimeter, to doValue Greece Loans and Credits claim Management S.A. ("doValue Greece") through a 14-year Service Level Agreement ("SLA"). The Group retainsthe business ownership and overall responsibility for the performance of the NPEs and manages the relationship with doValue Greece through a structured governance and a solid control framework. In this context, Eurobank established Remedial Servicing & Strategy Sector (RSS), a dedicated team that devises the NPE reduction plan, actively sets the strategic principles and Key Performance Indicators (KPIs) framework under which doValue Greece manages the portfolio, closely monitors the execution of the approved strategies and service level agreements and ensures compliance with regulatory requirements.

For the effective management of its loan portfolio in 2020, the Bank makes full use of all Greek State measures to support its clients to address the Covid-19 pandemic crisis. These measures include the subsidy for 9 consecutive months of loan instalment secured by a primary residence ("Gefyra" program), the provision of new working capital loans, covered by the Hellenic Development Bank (HBD) guarantee (participation in the new established "Business Guarantee Fund COVID - 19") and the interest rate subsidy (for 2 years) from the HDB of working capital loansin the framework of the action "Businessfinancing

TEPIX II". In addition, payment moratoria have been granted by the Greek Banks since end March 2020 in order to support borrowers that face financial difficulties due to the pandemic crisis and have applied for the moratoria up to 31 March 2021.

Troubled Assets Committee

The Troubled Assets Committee (TAC) is established according to the regulatory provisions and its main purpose is to act as an independent oversight body, closely monitoring the Bank's troubled assets portfolio and the execution of its NPE management strategy.

Remedial and Servicing Strategy (RSS)

The Remedial & Servicing Strategy Sector (RSS) is a newly established Sector, the Head of which reports to the General Manager of Group Strategy. The RSS has the mandate of the close monitoring of the overall performance of the NPE portfolio as well as the relationship of the Bank with doValue Greece.

In this context, RSS is a dedicated team that inter alia with the following responsibilities:

a) Develop and actively monitor the NPE targets and reduction plan
b) Set the strategic principles, priorities, policy framework and KPI's under which doValue Greece is servicing the portfolio
c) Closely monitor the execution of the approved strategies, as well as all contractual provisions under the relevant contractual agreements for the Eurobank portfolio assigned to doValue Greece including the securitized portfolio of ERB Recovery DAC
d) Monitoring of the performance of the senior notes of the securitizations and collaboration with Group Risk so asto ensure compliance to Significant Risk Transfer (SRT)
e) Budgeting and monitor of the Bank's expenses and revenues associated with the assigned portfolio
f) Cooperate closely with doValue Greece on a daily basis in achieving the Group's objectives
g) Maintain supervisory dialogue

Operational targets for Non-Performing Exposures (NPEs)

In March 2020, after considering the extraordinary circumstances due to the covid-19 pandemic, the SSM informed the European banks that the submission of their new 3-year NPE Management Strategy was postponed for March 2021. Specifically, in the context of the dialogue with SSM and its close monitoring on NPEs reduction progress, at the end of September 2020, Eurobank and the other Greek systemic banks submitted their updated NPE Management Strategy for the period 2020-2022 along with the NPE annual targets at group level, in a preliminary and draft form. Further, in March 2021, the Group submitted its 2021-2023 NPEs Strategy and plan, in accordance with the standard submission cycle. This envisaged the decrease of NPE ratio at ca. 9% at the end of 2021, 6.5% in 2022 and below 6% in 2023.

Pursuant to Law 4649/2019, on 25 February 2020, Eurobank submitted two applications for Cairo I and Cairo II securitisations and on 15 May 2020 a third one for the Cairo III securitization to the Ministry of Finance for opting-in to the Hellenic Asset Protection Scheme ("HERCULES"), which were all approved on 23 July 2020. With the closing of the Cairo transaction in early June 2020 and the subsequent derecognition of the underlying securitised loan portfolio of €7.2bn (consisting primarily of NPEs) in September 2020, the Group reduced significantly its NPE stock by €7.3bn reaching €5.7bn as at 31 December 2020 (31 December 2019: €13.0bn), driving the NPE ratio at 14.0% as at 31 December 2020 (31 December 2019: 29%).

In March and April 2020, EBA and the ECB announced guidelines aiming to mitigate the impact of the covid-19 pandemic on the EU banking sector stating, among others, that there is flexibility in the implementation of the EBA Guidelines on management of non-performing and forborne exposures. Additionally, EBA called for a close dialogue between supervisors and each bank on their non-performing exposure strategies.

Eurobank has been taking all appropriate actions to address liquidity difficulties of businesses and individuals caused by the limited or suspended operations of businesses resulting from the impact of Covid-19. In this context, Eurobank has defined a set of emergency relief measures that will apply to specific segments that are affected by Covid-19. These include moratoria to households (deferral of interest and principal payments) and to legal entities and professionals (deferral of principal payments) (note 5 to the consolidated financial statements).

Legal Framework

The protection scheme on primary residence was voted by the Greek Parliament in March 2019 (Law 4605/2019), aiming at reinforcing the banks' efforts to reduce NPEs through a more effective mechanism to work out troubled loans, a restriction of strategic defaulters and, ultimately, an improvement in payment discipline. The scheme expired in July 2020, instead of April 2020 as initially scheduled, and in October 2020, a new law (Law 4738/2020) was enacted introducing a comprehensive insolvency framework for individuals and companies in order to assist them to settle all their debts to the State, insurance funds, banks and servicers. The implementation of the new insolvency framework is expected within 2021.

In July 2020, a subsidy ('Gefyra') program (Law 4714/2020) was introduced by the Government in order to assist borrowers impacted by Covid-19. Applications were admitted until 31 October 2020 while the subsidy may start no later than 1 April 2021. The subsidy program will last for 9 months, followed by a probation period of 6 to 18 months (depending on the status of the borrower) with a clawback clause in case of overdue instalments. In the same context, on 31 March 2021 a new subsidy ('Gefyra II') program (Law 4790/2021) was introduced for eligible Small Business professionals and legal entities, as well as SMEs. Applications may be submitted until 9 May 2021, while the subsidy will cover part of the instalments for 8 months, followed by a probation period up to 18 months, depending on the loan status.

Macroeconomic Outlook and Risks

During 2020 and the first quarter of 2021, the outbreak of Covid-19 pandemic and the measures adopted to contain the virus expansion defined the economic environment in Greece and globally.

In the context of the Enhanced Surveillance (ES) scheme, the first nine consecutive quarterly reviews were successfully completed by February 2021. Greece received ca €3.4bn from the ES financial envelope in four disbursements, in May 2019 (€1.0 bn), in January 2020 (€0.8bn), in July 2020 (€0.8bn) and in February 2021 (€0.8bn). The conclusion of the 10th ES review is expected in May 2021.

Based on Hellenic Statistical Authority (ELSTAT) provisional data, the real GDP growth rate in 2020 registered a decrease of - 8.2% on an annual basis, from 1.9% in 2019, mainly as a result of the drop in the final consumption expenditure and exports of services. Based on Eurostat data, the Euro-area real GDP growth rate figures were at -6.6% and 1.3% for 2020 and 2019 respectively. According to the European Commission's (EC) winter economic forecasts (February 2021), the real GDP growth rate for 2021 and 2022 is expected at 3.5% and 5.0% respectively. Based on ELSTAT data, the unemployment rate stood at 15.8% in December 2020 on an annual basis (December 2019: 16.4%). The annual average unemployment rate for 2020 was at 16.3% from 17.3% in 2019. According to the EC's autumn economic forecasts (November 2020), the unemployment rate is expected at 17.5% and 16.7% for 2021 and 2022 respectively. Based on ELSTAT data, the 12-month average harmonized index of consumer prices-(HICP) in December 2020 was at -1.3% (12-month average for December 2019: -1.2%), whereas on an annual basis, according to the EC's autumn economic forecasts the HICP for 2021 and 2022 is expected at -0.1% and 0.6% respectively.

On the fiscal front, according to the EC's autumn economic forecasts, Greece's fiscal primary balance in European System of National and Regional Accounts (ESA2010) terms, is expected to register in 2020 and 2021 a deficit of 3.8% and 3.6% of GDP respectively, taking into account the public support measures as of 22 October 2020. According to the 2021 Budget forecasts, the primary balances for 2020 and 2021 are expected to register a deficit of 7.2% and 3.9% of GDP respectively, as a result of the fiscal support measures, while the gross public debt is expected at 208.9% and 199.6% of GDP for 2020 and 2021 respectively. The deviation from the ES primary surplus target of 3.5% of GDP for both 2020 and 2021 will not be considered a violation of Greece's commitments undertaken in the ES framework, as on 4 March 2020 Eurogroup decided that nonpermanent deviations from the agreed fiscal paths of the member-states, due to unusual effects outside the control of their governments (i.e. the effects of the Covid-19 pandemic), are acceptable. According to the 15 March 2021 Eurogroup, the deviation from the ES target will continue in 2022, on a preliminary basis. The aforementioned primary balance and public debt forecasts might change significantly as a result of the actualsize of the public sector'ssupport measures and the reduction in tax revenues due to the Government's relevant moratoria and the decline of economic activity.

In response to the Covid-19 outbreak, there has been an unprecedented monetary, fiscal and regulatory support to the economy and the banking system by both Greek Government and European authorities. According to the 2021 Budget, the Greek Government's planned total measures aiming to address the economic effects of the Covid-19 pandemic amount to €31.5bn of which €23.9bn correspond to 2020 and €7.6bn to 2021, including the cost of the ruling of the Council of State on pension cuts. According to the Ministry of Finance as of 29 March 2021, the support measures are expected to further increase to €14.5bn for 2021 and at €38.0bn for 2020 and 2021. These measures include, among others: (a) the reduction of the private sector's social security contributions by 3 percentage points and the abolishment of the Special Solidarity levy for the private sector (only for 2021); the reduction of advanced income tax payment for firms and freelancers, (b) the payment by the government of the social security contributions for employees under labour suspension, (c) the suspension of VAT payments for firms affected by the Covid-19 pandemic, the social security and the tax related debt instalments for firms and freelancers, (d) the temporary economic support to wage earners under labour suspension, to seasonal employees (tourism sector), and to certain scientific sectors, (e) the Easter and Christmas bonus state contribution for employees under labour suspension; the employment subsidy under "synergasia" program; the extension of the regular and long-term unemployment benefit, interest rates subsidies for firms that remained closed during the lock down period as well as mortgage loans subsidies to households and small businesses (Gefyra I and II). The public support for 2020 included also leverage provided by the banking system of €5.7bn on top of the €2.6bn of the Public Investment Budget for cash-collaterals and the co-financing of loans to small and medium size enterprises.

On top of the above, the liquidity support for the economy via the various EC, European Stability Mechanism (ESM) and European Investment Bank (EIB) initiatives amounts to €10.3bn and includes, among others, loan guarantees (€7.0bn) and SMEs loans (€1.3bn). According to the European Council on 21 July 2020 agreed a recovery package amounting to €750bn under the EC's Next Generation EU framework in order to support the recovery and resilience of the member states' economies, out of which ca. €31bn will be available for Greece, provisionally divided to €18.2bn in grants and €12.7bn in loans. According to the Greek Government, the submission of the National Growth Plan for Greece – a prerequisite for any disbursement from the NGEU fund – is expected by the end of April 2021. The respective amount for the Multiannual Financial Framework 2021-2027 (MFF) is at €1,100bn, of which ca. €40bn will be available for Greece. Furthermore, the ECB, on 24 March 2020 established a temporary Pandemic Emergency Purchase Programme (PEPP) with a financial envelope of €1,850bn, as of mid-February 2021, out of which ca €46bn will be available for the purchase of Greek public and private sector securities. The PEPP came on top of the ECB liquidity measures of 12 March 2020 (additional Long Term Financing operations, more favourable terms for the Targeted Long Term Operations, new Asset Purchase Programme of €120bn).

On 22 January 2021, Fitch affirmed its stable outlook for Greece with the respective rating remaining unchanged at BB, on the basis of the medium term public finance and real GDP growth prospects. On 9 November 2020, Moody's upgraded Greece from B1 to Ba3 on the basis of the continuation of the reform process and the growth prospects of the country, despite the expected negative impact of the Covid-19 crisis on economic activity, the fiscal and external sector developments. Standard & Poors, on 24 April 2020 revised its outlook for Greece from positive to stable due to the expected adverse effects of the Covid-19 pandemic. The sovereign's rating is still below the investment grade. However, the progress made from 2018 onwards and the inclusion of the Greek sovereign to the eligible titles for the ECB's Pandemic Emergency Purchase Programme, led to the improvement of the yield of the Greek 10-year bonds to 0.63% on 31 December 2020 compared to 1.46% on 31 December 2019 (31 December 2018: 4.40%).

In such an environment the Greek State managed to achieve continuous market access after the pandemic outbreak, from April to December 2020, with the issuance of four bonds of various maturities. On 27 January 2021, the PDMA issued a 10 year bond of €3.5bn at a yield of 0.807% and more recently, on 17 March 2021, the PDMA issued a 30-year bond of €2.5bn at a yield of 1.956%. Additionally, according to the ECB's decision notified to the Bank on 6 March 2020, it has been concluded that the reasons to impose sovereign limits on the Greek banks' (including Eurobank) exposure towards the Hellenic Republic have ceased to exist and therefore its previous decision on those limits has been repealed.

According to the Bank of Greece's data, the private sector domestic credit balance at the end of December 2020 stood at €141.2bn from €153.8bn at the end of December 2019 registering an annual decrease of -8.2%. A significant part of this deleveraging was due to the reduction of the stock of NPEs. On the other side of the ledger, private sector domestic deposits amounted to €163.0bn at the end of December 2020 from €143.1bn at the end of December 2019, registering an annual increase of 13.9%.The significant increase in deposits is mainly attributed to the Covid-19 containment measures that prevent consumption by householdstogether with the government measures aiming to support the private sector and the uncertainty created by the pandemic environment.

As of late February 2021, the improvement pace of the epidemiological situation in many countries of the Central, Eastern and South-eastern Europe (CESEE), which had started in the past two months, stalled making authorities more cautious in activating their reopening plans. Having been confronted with an exponential rise in new infections, hospitalizations and fatalities during October and November, authorities across the region reinstated stringent health and social distancing measures and restrictions on public and economic activities. The restrictions were initially imposed at the local level but were soon extended at the national level, while some countries even resorted to a national lockdown to avoid further aggravation.

Although the rollout of vaccinations across the region has spurred more optimism for the growth prospects of the broader CESEE region in 2021, full return to normal conditions may take more time to materialize. The resurgence of infections will most probably put a break on the pace of recovery-not limited to the services sector-under the assumption that restrictive measures will most probably remain in place in the first months of 2021. In addition, the logistics of the production, distribution and execution of vaccination program on such a massive scale may require additional investments and effort, leading potentially to further delays.

Bulgaria is among those European countries mostly affected from the pandemic resurgence since October 2020. As a result, authorities imposed restrictions on economic activity via a state of emergency which was extended until at least the end of April 2021. Factoring in the positive performance in fourth quarter, the economy contracted by 3.8% in 2020 compare to an expansion of 3.4% in 2019, outperforming the Euroarea average. According to the EC's winter economic forecasts (February 2021), the economy is expected to be heading towards a +2.7% rebound in 2021, before accelerating further by +4.9% in 2022. On the positive side, the country is capitalizing on itsstrong fiscal profile and healthy external metrics (i.e. the current account and the external debt) as well as the recent ERM II entry, which anchors investors' expectations, plus its's access to ECB-EU tools to contain the negative impact of the pandemic crisis. In that direction, the state budget for 2021 provides for a rise in

public sector wages, pensions and social payments, envisaging a higher fiscal deficit target of -3.9% of GDP in 2021 up from a realized -3% in 2020. Additionally, the latest EU Council decision foresees Bulgaria receiving €29bn from EU support (€16.7bn non-reimbursable funds from the MFF for the period 2021-2027 and €12.3bn from the NGEU). Finally, the country is headed for parliamentary elections in early April 2021.

In Cyprus, the rapid deterioration of the epidemiological situation in third quarter prompted local authorities to reintroduce social distancing measures, initially at a local level and subsequently at a national level until the end of January 2021 with some gradual relaxation thereafter. The economic impact has turned out so far less severe than initially anticipated despite the country's high sensitivity as a small, open and services-oriented economy with tourism being one of its core industries. The over-performance can be broadly attributed to the quick,sizeable and still ongoing financialsupport from the government and the extensive use of banks' loan moratoria which put Cyprusin the first place of the relevant EU ranking in 2020. Factoring in the positive performance of the third and fourth quarters, real GDP contracted by 5.1% year-on-year in 2020. According to the EC's winter economic forecasts (February 2021), the economy is headed to rebound by +3.2% in 2021 and +3.1% in 2022. In early January 2021, to mitigate the impact of the pandemic crisis, the Cyprus government announced additional support measures, the total amount ranges from €350 to €450m, on the top of implemented in the outgoing year financial support package in fiscal measures of €1bn and government guarantees and liquidity support measures of €3.3bn, some of them extending until 2024. Cyprus was also among the first to tap international markets in 2021, raising an amount of €1.5bn with a new 5 year bond at relatively low yields to address the increased gross borrowing needs of 2021. In addition, Cyprus has already received the first instalment of €250m in loans from the "Support to mitigate Unemployment Risks in an Emergency" (SURE) instrument out of a total €479m earmarked amount in order to address increased unemployment risks. In addition, Cyprus intends to become the first country to tap the ESM's Pandemic Crisis Support fund (up to 2% of 2019 GDP) to cover its increased healthcare expenditures. Finally, under the latest EU Council decision in July 2020 for the NGEU and the MFF, Cyprus could have access to more than €2.6bn or 11.7% of 2019 GDP in funds, among them around €1bn in grants.

Having expanded by more than 4% in 2018 and 2019, the economy of Serbia contracted by only 1.0% in 2020 making the country a top performer in EU and CESEE. According to the EC's autumn economic forecasts (November 2020), the economy is headed to rebound by +4.8% in 2021. The economy entered the Covid-19 crisis with significantly lower imbalances than a decade ago allowing the authorities to compile a support package of 11% of GDP (which was among the largest in emerging Europe) to contain the pandemic's negative economic impact. Furthermore, the country's lower than regional peers exposure to tourism industry, a sector adverse affected by the crisis and the relatively short duration of the moststringent containment measures back in spring 2020 underpins its over performance in 2020-2021. In addition, the Serbian government has applied for aid from the EU solidarity fund under the same conditions as an EU member state. In late February 2021, the Ministry of Finance issued a 12- year bond of €1bn in the international capital market for the first time at a yield of 1.92%. Finally, even though the 30-month non-financial advisory Policy Coordination Instrument ("PCI") that has been established by the IMF was successfully concluded in January 2021, it still provides a valuable policy anchor going forward.

A long-awaited EU-United Kingdom (UK) trade deal was finally agreed in late December 2020, coming into effect from 1 January 2021, after the post-Brexit transition period ended. Under the deal, no tariffs or quotas will be applied on bilateral EU-UK goods trade, provided that rules of origin are met. However, non-tariff barriers will be erected and important areas of economic relations remain to be resolved, including provisions relating to equivalence in financial services. The main risk for Greece from the UK's exit stems from the external balance of goods and services between the two countries. In this context, the UK branch of the subsidiary bank in Luxembourg, has in place the necessary regulatory permissions (both by SSM/CSSF, as a third country branch, and under PRA's Temporary Permissions Regime) and will maintain the targeted nature of its operations, focusing mostly on financing UK properties and attracting deposits (including from EU clients with a UK business nexus)."

Regarding the outlook for the next 12 months, the major macroeconomic risks and uncertainties in Greece mainly relate with the outbreak of Covid-19 pandemic and are as follows: (a) the evolution of the health crisis including the probability of the continuation of the pandemic, well after the end of the first half of 2021, and its negative effect on the domestic, regional and / or global economy, (b) the progress on the vaccination programs to contain effectively the virus expansion, (c) the actual size and duration of the fiscal measures aiming to address the effect of the pandemic on the real economy and their effect on the long-term sustainability of the country's public debt, (d) the pace of the economy's recovery in 2021 and 2022, (e) the absorption capacity of the NGEU and MFF funds and the attraction of new investments in the country, (f) the implementation of the reforms and privatizations' agenda in order to meet the ES targets and milestones, and (g) the geopolitical conditions in the near or in broader region.

capital and liquidity standing as well as the fulfilment, to the maximum possible degree, of its strategic and business goals for the quarters ahead, focusing primarily on the support of its clients to overcome the challenging juncture, the mitigation of "cliff effects" post the moratoria expiration, the protection of its asset base and the resilience of its pre-provision profitability.

On the other hand, the decisive implementation of the reforms agreed in the context of the ES, the efficient mobilization of EU funding via the NGEU and the MFF to support domestic investment and job creation, the attraction of foreign and domestic capital and the adoption of an extrovert economic development model will improve the confidence in the prospects of the Greek economy and the further stabilization of the domestic economic environment, which are necessary conditions for the return of the country to a strong and sustainable growth path.

Share Capital

As at 31 December 2020, the total share capital of Eurobank Ergasias Services and Holdings S.A. (Eurobank Holdings or Company) amounted to €816,015,607.44 divided into 3,709,161,852 common voting shares of nominal value of €0.22 each. All shares are registered, listed on the Athens Stock Exchange and incorporate all the rights and obligations set by the Greek legislation. As at 31 December 2020, the number of Eurobank Holdings shares held by the Group's subsidiaries in the ordinary course of their business was 2,433,987 (31 December 2019: 2,815,312) (note 37 to the consolidated financial statements).

As at 31 December 2020, the percentage of the ordinary voting shares of Eurobank Holdings held by the Hellenic Financial Stability Fund (HFSF) amounted to 1.40%. It is noted that, according to the Law 3864/2010 as in force, the HFSF has restricted voting rights³ .

On 7 July 2020, the Board of Directors of the Company proposed to the General Shareholders' Meeting the distribution of Mairanus Limited (renamed to Cairo Mezz Plc) shares to Company's shareholders through the decrease in kind of its share capital. Following the above, on 28 July 2020, the General Meeting of the Shareholders of the Company approved among others:

a) The decrease of the share capital in kind with the decrease in the nominal value of each ordinary share issued by the Company by € 0.0155 and distribution to the shareholders of the Company of shares issued by Cairo Mezz Plc (Issuer), with a value corresponding to the value of the share capital decrease, i.e. 309,096,821 common shares issued by Cairo Mezz Plc, each common registered share of nominal value €0.10, at a ratio of 1 share of Cairo Mezz Plc for every 12 shares of the Company already held..
b) The capitalization of taxed reserves amounting to €20,400,390.19 for the purpose of rounding the new nominal value of each ordinary share issued by the Company.

Regarding the a) and b) above, the Ministry of Development & Investments by virtue of its decision 81660/31.07.2020 approved the amendment of article 5 of the Company's Articles of Association. On 21 September 2020 the Athens Stock Exchange ("ATHEX") Corporate Actions Committee was notified of the Company's aforementioned corporate action. On 21 September 2020 the Athens Stock Exchange Listings and Market Operation Committee approved the admission to trading of the shares of Cairo Mezz Plc on the EN.A. PLUS segment of the Alternative Market ("EN.A. PLUS"), which started trading on 29.9.2020.

Share options

In addition, the aforementioned General Meeting of the shareholders of the Company:

a) approved the establishment of a five year shares award plan, starting from 2021, in the form of stock options rights by issuing new shares with a corresponding share capital increase, awarded to executives (of the Management) and personnel of the Company and its affiliated companies. The maximum number of rights that can be approved will be 55,637,000 rights, each of which will correspond to one new share, i.e. in case all option rights are exercised up to 55,637,000 new common registered shares of the Company in total will be allocated, corresponding to 1.5% of the current paid share capital. The exercise price of each new share is equal to the nominal value of the share.
b) authorized the Board of Directors of the Company to determine the remaining terms and conditions of the plan.

Dividends

Based on the 2020 accounts, pursuant to the Company Law 4548/2018, the distribution of dividends is not permitted. Furthermore, under the provisions of the Tripartite Relationship Agreement between Eurobank Holdings, Eurobank and the HFSF (signed 23.3.2020) and article 10 par.3 of Law 3864/2010 for the "establishment of a Hellenic Financial Stability Fund", for as long the HFSF participates in the share capital of Eurobank Holdings, the amount of dividends that may be distributed to shareholders of either Eurobank Holdings or Eurobank cannot exceed 35% of the profits as provided in article 161 par. 2 of Company Law 4548/2018.

³ Information regarding HFSF's rights as owner of Eurobank Holdings' ordinary shares, according to Law 3864/2010 and the Tripartite Relationship Framework Agreement (TRFA), is included in Corporate Governance Code and Statement.

Major Shareholders

Based on the relevant published regulatory announcement of Eurobank Holdings:

a) the percentage of Eurobank Holdings' voting rights held directly and indirectly by the company "Fairfax Financial Holdings Limited", on 7 November 2019, through its controlled subsidiaries, amounted to 31.71%, out of the total number of Eurobank Holdings' voting rights, excluding those held by the HFSF, corresponding to 1,159,833,335 voting rights of Eurobank Holdings' shares,
b) Companies, Inc", on 1 December 2020, amounted to 5.14% out of the total number of Eurobank Holdings' voting rights, excluding those held by the HFSF, corresponding to 187,812,291 voting rights of Eurobank Holdings' shares,
c) the percentage of Eurobank Holdings' voting rights held indirectly by the company "Helikon Investments Limited", on 27 January 2021, amounted to 5.08% out of the total number of Eurobank Holdings' voting rights, excluding those held by the HFSF, corresponding to 185,951,550 voting rights of Eurobank Holdings' shares.

Finally, reflecting the HFSF's status as a shareholder of Eurobank Holdings (it currently owns 1.4% of Eurobank Holdings' shares, which corresponds to 52,080,673 ordinary shares with voting rights out of total 3,709,161,852 ordinary shares with voting rights issued by Eurobank Holdings), and following the completion of the demerger of Eurobank Ergasias S.A., Eurobank Holdings, Eurobank and the HFSF are parties to a Tripartite Relationship Framework Agreement (TRFA) signed on 23 March 2020. The TRFA allows the HFSF to enforce against Eurobank all the rights which it had against the former Eurobank Ergasias S.A. under an earlier Relationship Framework Agreement (RFA) between it and Eurobank Ergasias S.A. Moreover, the provisions of article 7a par. 2, 3 and 6 of Law 3864/2010 (HFSF Law) are applicable on the above-mentioned ordinary shares of HFSF (restricted voting rights). According to the HFSF Law and the TRFA, the HFSF has the right to vote at the General Meetings of Eurobank Holdings only for decisions concerning (i) the amendments of the Articles of Association of Eurobank Holdings, including the increase or reduction of the capital or the corresponding authorisation to its Board, (ii) mergers, divisions, conversions, revivals, extension of term or dissolution of Eurobank Holdings, (iii) the transfer of assets (including the sale ofsubsidiaries) or (iv) any other issue requiring increased majority as provided for in the Greek law on Sociétés Anonymes.

Board of Directors

The Board of Directors (BoD) was elected by the Annual General Meeting (AGM) of the Shareholders held on 10 July 2018 for a three years term of office that will expire on 10 July 2021, prolonged until the end of the period the AGM for the year 2021 will take place.

Further to that:

a) Mr. Theodoros Kalantonis, submitted his resignation, effective as of 3 April 2020.
b) The BoD by its decision dated 8 April 2020, appointed Ms. Alice Gregoriadi and Ms. Irene Rouvitha Panou as its new independent non-executive members, in replacement of the resigned independent non-executive members Mr. Richard Boucher and Mr. Nikolaos Bertsos, their resignations being effective as of 8 April 2020, and their term of office will expire concurrently with the term of office of the other members of the BoD.
c) Mr. George Μyhal, submitted his resignation, effective as of 10 December 2020. The BoD by its decision the same date appointed Ms. Cinzia Basile as new independent Non-Executive Director, in replacement of the resigned independent non-executive member Mr. George Myhal for an equal term to the remaining term of the resigned member.
d) The BoD by its decision dated 10 December 2020 appointed Mr. Andreas Athanasopoulos as new executive Director in replacement of the resigned executive Director Mr. Theodoros Kalantonis for an equal term to the remaining term of the resigned member.
e) The BoD by its decision dated 28 January 2021, appointed Ms Efthymia Deli as the new representative of the HFSF and non-executive member of Eurobank Holdings BoD in replacement of the resigned Mr. Dimitrios Miskou, according to the provisions of Law 3864/2010 and the existing Relationship Framework Agreement with the HFSF (TRFA), for an equal term to the remaining term of the resigned member.

The BoD of Eurobank Holdings is set out in note 48 to the consolidated financial statements. Personal details of the Directors are available on the website of Eurobank Holdings (www.eurobankholdings.gr).

Sundry information required under Law 3556/2007 (article 4, par.7)

By derogation of the ordinary shares held by HFSF which carry special rights and restrictions under the legislation in force and the TRFA signed between Eurobank Holdings, the Bank and the HFSF on 23 March 2020 (note 46 to the consolidated financial statements), according to the Articles of Association:

a) there are no restrictions on the transfer of the Eurobank Holdings' shares
b) there are no shares with special controlling or voting rights
c) there are no restrictions on voting rights
d) the rules related to the appointment and replacement of directors as well as to the amendment of the Articles of Association are in accordance with the provisions of company law.

The Eurobank Holdings is not aware of any shareholders' agreements resulting in restrictions in the transfer of its shares or in the exercise of the shares' voting rights. There are no significant agreements that enter into force, are amended or expire if there is change in the control of the Eurobank Holdings following a public offer. There are no agreements between the Eurobank Holdings and the Directors or the staff for compensation in the event of departure as a result of a public offer.

Information required under Law 4548/2018 (article 97, par.1 (b))

For the purposes of approval for i) the amendment of the Service Level Agreement between the subsidiary Eurobank S.A. and Grivalia Management Company S.A. (Grivalia ManCo) which is a related party to Eurobank Holdings within the meaning of paragraph 2(a) of article 99 of Greek Law 4548/2018 and to Eurobank within the meaning of paragraph 2(b) of article 99 of Law 4548/2018 and ii) conclusion of a lease contract and the amendment of this lease between Eurobank S.A. and Grivalia, the BoD's approval was granted based on a fairness opinion report provided by a certified auditor in accordance with article 101 of Law 4548/2018, while all the necessary disclosure procedures were adhered to as provided for in articles 100 par. 3 and 101 par. 2 and 3 of Law 4548/2018. Furthermore, for the same issues, the Vice Chairman ofthe BoD Mr. George Chryssikos, also Vice Chairman and Chief Executive Officer of Grivalia holding 70% of its share capital, was not entitled to vote, according to the provisions of par. 3 of art. 97 of the Law 4548/2018, due to conflicts of interest.

Also, for the purposes of granting of a written consent, as per the provisions of the Service Level Agreement between Eurobank and Grivalia which is a related party to Eurobank within the meaning of paragraph 2(b) of article 99 of Law 4548/2018 and in accordance with the International Accounting Standard 24 for the transfer of Grivalia shares corresponding to 2% of its share capital by Mr. Georgios Chryssikos to another physical person, the Vice Chairman of the BoD Mr. George Chryssikos, was not entitled to vote, according to the provisions of par. 3 of art. 97 of the Law 4548/2018, due to conflicts of interest.

For the purposes of decisions related to a legal case (legal dispute between Hellenic Public Properties Company S.A. and a group of companies that is a debtor of Eurobank), the CEO and the independent non-executive director Ms. Alice Gregoriadi were not entitled to vote, according to the provisions of par. 3 of art. 97 of the Law 4548/2018, due to conflict of interest.

In the framework of the approval of the revision of the Separation Policy, which concerns Senior Executives of Eurobank at the level of CEO, Deputy CEO and General Manager, given that the Executive members of the BoD are related parties to Eurobank Holdings within the meaning of paragraph 2(a) of article 99 of Greek Law 4548/2018 and to Eurobank within the meaning of paragraph 2(b) of article 99 of Law 4548/2018 and in accordance with the International Accounting Standard 24, the BoD's approval was granted based on a fairness opinion report provided by a certified auditor in accordance with article 101 of Law 4548/2018, while all the necessary disclosure procedures were adhered to as provided for in articles 100 par. 3 and 101 par. 2 and 3 of Law 4548/2018. Furthermore, for the same issue the executive BoD members Messrs. Fokion Karavias, Stavros Ioannou, Theodoros Kalantonis and Konstantinos Vassiliou were not entitled to vote, according to the provisions of par. 3 of art. 97 of the Law 4548/2018, due to conflict of interest, since the relevant decision related to a financial transaction of the Bank with themselves.

Οn the occasion of the approval of the remuneration adjustment of the Chief Executive Officer, given that the Chief Executive Officer is a related party to Eurobank Holdings within the meaning of paragraph 2(a) of article 99 of Greek Law 4548/2018 and to Eurobank within the meaning of paragraph 2(b) of article 99 of Law 4548/2018 and in accordance with the International Accounting Standard 24, the BoD's approval was granted based on a fairness opinion report provided by a certified auditor in accordance with article 101 of Law 4548/2018, while all the necessary disclosure procedures were adhered to as provided for in articles 100 par. 3 and 101 par. 2 and 3 of Law 4548/2018. Furthermore, for the same issue the Chief Executive Officer Mr. Fokion Karavias was not entitled to vote, according to the provisions of par. 3 of art. 97 of the Law 4548/2018, due to conflict of interest, since the relevant decision related to adjustment to his remuneration.

For the purposes of approval for providing financial information to a shareholder considered to have significant influence over Eurobank Holdings, following a request by the said shareholder arising from its regulatory requirement, the BoD member Mr. Bradley Paul L. Martin, was not entitled to vote according to the provisions of par. 3 of art. 97 of the L. 4548/2018 due to conflicts of interest as the Vice President of Strategic Investments to this shareholder.

Finally, for the purposes of approval for granting a credit facility by Eurobank to the company Praktiker Hellas S.A., a wholly owned subsidiary of a shareholder considered to have significant influence over Eurobank Holdings, the BoD member Mr. Bradley Paul L. Martin was not entitled to vote, according to the provisions of par. 3 of art. 97 of the L. 4548/2018 due to conflict of interest as Vice President of Strategic Investments to this shareholder.

External Auditors

The Eurobank Holdings' Shareholders Annual General Meeting held on 28 July 2020 approved the appointment of KPMG, as statutory auditor for the financial statements (standalone and consolidated) for the year ending 31 December 2020.

During 2020 the Audit Committee reviewed the independence and effectiveness and the annual plan of KPMG and monitored on a quarterly basis the Group's use of the auditors for non-audit services and the balance of audit and non-audit fees paid to the auditors, according to the Bank's External Auditor's Independence Policy (note 47 of the consolidated financial statements).

Non financial information

Business model

Eurobank offers a wide range of financial services to the Group's retail and corporate clients. Eurobank has a strategic focus in Greece in fee-generating activities, such as asset management, private banking, equity brokerage, treasury sales, investment banking, leasing, factoring, real estate and trade finance. Eurobank is also among the leading providers of banking services and credit to SMEs, small businesses and professionals, large corporates and households. The Group has an international presence in six countries outside Greece (see further information in the section "International Activities").

Eurobank's diversified business model through businessline, geography and customer, helps enhance itsresilience to changes in the external environment. Its strategy aims at optimizing the financial performance, maintaining a strong capital base as well as contributing to the economy and society in a holistic manner.

In conducting its business activities, the Group considers the particular and diverse needs of its stakeholders and focuses on creating value for them. In this context, the Group a) makes appropriate use of available funds for supporting its customers and financing the economies in which operates, mainly in Greece and in Southeastern Europe, b) relies on the skills and expertise of its human resources for the implementation of its business strategy including the improvements of products and services to customers; for this purpose, it enhances staff engagement by strengthening the knowledge and experience of its employees through training and development programmes and providing a safe and productive work environment and c) invests in IT infrastructures and digital transformation for achieving in operating efficiency and improving customer experience.

Beyond core business activity, the Group responding to the needs of today's ever-changing environment, consistently designs actions relating to social and environmental issues, adopting responsible practices that promote transparency and business ethics. The Group links its business decisions to environmental sustainability, social responsibility and corporate governance (ESG). Driven by its sense of responsibility and commitment to giving back to society, it has made sustainability one of the foundations of its strategic planning, which is directly linked to UN Sustainable Development Goals (SDGs).

Eurobank also signed the UN Global Compact in 2008 actively supporting its 10 principles and in 2019, signed the Principles of Responsible Banking thatset the framework for the future development of a sustainable banking system with a strong positive mark on society and the environment. The Principles for Responsible Banking are supported by 220 banks around the world, and were shaped by the global banking industry through the UNEP FI (United Nations Environment Programme Finance Initiative). Moreover, Eurobank Asset Management MFMC, the Bank's subsidiary, is the first asset management company in Greece to sign the PRI (Principles for Responsible Investment) initiative in 2018, as part of the broader policy of the Eurobank Group to support sustainability and responsible entrepreneurship.

Having built a flexible, sustainability-oriented operational model, the Group adapted it immediately to address Covid-19 pandemic by strengthening of existing digital channels infrastructure to support its customers, business and households (see further information in the section "Response to the impact of the covid-19 crisis").

Materiality Analysis

Eurobank adopts and follows the Sustainability Reporting Guidelines of the Global Reporting Initiative (GRI Standards) international framework, for the development of its Sustainability Report. In this context and in order to respond to the expectations, concerns and needs of its stakeholders (customers, employees, suppliers, investment analysts and investors, business community organisations, government and regulatory authorities, the media, associations and non-governmental organisations and young entrepreneurs) in 2021 Eurobank has carried out the process of materiality analysis to update the most important issues related to sustainable development. In order to carry out the materiality analysis, Eurobank carried out a questionnaire survey of 18 sustainability issuesregarding the economy, society, the environment and corporate governance. For the preparation of the material issues were taken into account issues concerning the banking sector, the Greek economy as well as the social environment. Following a review of the findings, the material issues presented in the Materiality Matrix were identified.

a) Integration of new technologies Digital Banking Digital Transformation
b) Personal data protection
c) Financial growth Performance
d) Supporting and financing the Greek economy
e) Actions and initiatives to manage Covid-19 pandemic impact
f) Attracting and developing human resources and continuously improving the knowledge and skills of employees through modern training and development Programmes
g) Business Ethics and Regulatory Compliance
h) Improvement of products and services
i) Corporate Governance and Risk Management
j) Safe and productive work environment with the integration of new technologies
k) Responsible provision of information and customer service
l) Access to financial services for all (financial inclusion)
m) Environmental footprint and climate change
n) Investments, financing and products based on social and environmental criteria (ESG)

An integral part of Eurobank's approach to corporate responsibility is the fostering of strong relationships, cooperation and mutual benefit with all stakeholders affected directly or indirectly by its activities. In this context, Eurobank promotes twoway communication and develops an ongoing dialogue with stakeholders, so as to be able to offer tangible responses to the expectations, concerns and issues raised by all its stakeholders. In this context, materiality analysis, GRI indicators and the Eurobank's Corporate Social Responsibility actions are described in the Annual Report 2020-Business and Sustainability edition, which will be published on www.eurobankholdings.gr. The Annual Report 2020-Business and Sustainability edition is being prepared in line with the Sustainability Reporting Guidelines of the Global Reporting Initiative (GRI) international framework, while the 10 Principles of the United Nations Global Compact, the 7 fundamental Corporate Responsibility Principles of ISO 26000:2010 International Standard, and the AccountAbility (ΑΑ1000 AccountAbility Principles Standard 2008 have also been taken into account.

Employee Engagement

The Group's employees constitute its greatest asset as far as development and sustainability are concerned. It is among Group's priority that the recruitment process marks the beginning of a long-lasting and mutually beneficial partnership between the employee and the Group. As of 31 December 2020, the Group employed 11,501 employees of which 4,737 abroad. The average number of employees for the Group are below 45 years old, while 64% are women.

In order to ensure equal and fair opportunities to all employees, the Group implements a number of policies in Greece and abroad in the areas of Compensation & Benefits, Recruitment, People & Talent Development, Performance Management, Learning, Engagement & Communication, Kinship and Health & Safety. The Group respects human rights, equal opportunities and diversity vis à vis clients, suppliers and employees while the Group's objective is to recruit and retain its employees regardless of race, religion, age, gender, sexual orientation or disability. The Group strives to ensure that its workforce reflects the communities in which it operates and the international profile of the organization. The Group recognizes that diversity is a key component of a responsible businessstrategy in support of itsinternational operations. Related matters were addressed in the updated 2020 Code of Conduct & Ethics for the Group.

The Bank is constantly revising its compensation and benefits framework taking into consideration market trends and aiming to create a competitive offering that will attract, engage and retain its employees while at the same time comply to all regulatory and legal requirements. As a result, the basic principles of the compensation and benefitsframework, which ensure alignment between individual objectives and the Bank's business strategy, as well as the long-term value creation for the shareholders, are the following:

a) Safeguard that total reward is sufficient to retain and attract executives with high skill and expertise
b) Ensure internal equity between Business Units
c) Mitigate risk
d) Link compensation with long-term performance

Learning, Personal and Professional Development

Building and strengthening professional expertise with current skills and capabilities, as well as providing an umbrella of modern learning curriculums and methodologies constitutes a major priority for the digital transformation strategy of the Group. The leading Learning Management System SAP Success Factors offers new enhanced self-service capabilities to all employees to redefine and upgrade the knowledge and skills needed in the workplace (reskilling & upskilling). The rapid adaptation to the new conditions and the size of investment in learning for 2020 are reflected briefly in the following indicators:

a) 73.7% of overall learning initiatives for the Group are online. The respective percentage for Greece is 90.2%,
b) Average training days per employee: 3.79,
c) 261.286 training man-hours for the Group of which 102.498 in Greece,
d) 53.764 overall training participations for the Group, accounting for 82,2% of employees

Upgrading of digital skills, capitalizing on technology and learning certifications constitute the axes of the strategic learning framework in Eurobank. The adoption of the SAP Success Factors Human Resources Management System platform for all employees in Greece and Cyprus has provided the infrastructure for a flexible and "smart" working environment, prioritizing learning, contributing to an advanced learning experience as well as multifaceted and diverse learning offerings. Particularly in the area of digital learning new authoring tools were used in order to design new learning units that fully meet the current needs for digital content and online flexibility.

To fully meet employees' and Group's learning needs, the Group implements policies and procedures certified according to the ISO 9001 standard. At the same time and since 2015 the Bank holds, the ACCA Approved Employer (Professional Development Stream) distinction, documenting the high training standards of its employees. Aimed at empowering employees on more demanding roles and enhance leadership capabilities, the Bank designs and implements specialized programs, such as Development & Succession planning, Talent Development & Management, Career Development & Planning, Knowledge & Experience Sharing (mentoring & reverse mentoring).

Development and Performance Evaluation system "Axiopoio"

The Group's Performance Management process in Greece and Cyprus is based on a tailor-made employee development system named "Axiopoio" whose two main pillars streamline employee's performance with the Group's strategy and its culture. In 2020, the "Axiopoio" process was upgraded ("Axiopoio New Edition") and integrated into the SAP SuccessFactors HRMS platform. With the new edition, employees can configure, monitor and adjust their priorities, in collaboration with their Manager, as well as give and receive feedback continuously, inside and outside of their unit. "Axiopoio" focuses on the impact that the employees have on the results of the Group and on the cooperation within their team, through the priorities they set and the behaviors they display. With access from every "smart" device, performance appraisal becomes a modern tool that supports the dynamic way of working today. Alongside the implementation of the new edition of Axiopoio, the performance evaluation for the year 2019 was completed, under very difficult conditions due to the Covid-19 pandemic. Regardless of the difficulties faced, 98.7% of staff in Greece received timely feedback on the progress of their performance through digital evaluation meetings, discussing all important priorities for the current year.

Improving Employee Experience

Eurobank, through the investment in the SAP SuccessFactors upgrades the working environment and expands the possibilities of cooperation. As part of the project, which will continue in 2021, the basic technological infrastructure was enriched with modern applications related to the acquisition of "talent" (talent acquisition) and performance appraisal. The applications of the SAP SuccessFactors platform improve the daily communication in the Group, increase the degree of autonomy and mobility of the users while managers can monitor and manage their teams. In particular, with the functions that are available both from the office space and on all the "smart" devices, the users, among others:

a) Have access, wherever they are, to their personal profiles and contact details of their colleagues,
b) Register and manage with self-service process, license requests and change of personal data,
c) Have access to learning and training planning for themselves and their teams, can attend online courses and connect to online libraries that are available (Learning Management System),
d) Have access to a modern evaluation and continuous feedback application.

Strengthening Dialogue & Information

Employees are systematically kept informed on a series of issues of interest and/or corporate issues through a variety of means including print, interpersonal and online ways. In 2018, the Group in Greece launched its new Intranet Portal named "Connected" and social network Yammer, providing timely corporate and work-related information to all employees. Within 2020, a special Covid-19 section was created on its home page with useful material and announcements. In addition, information about the Medical Help Line and the Telephone Support Line was placed in a prominent place, so that the employees could have immediate access. For the dissemination of the strategy and the two-way communication between the Management of the Bank and the employees, the program "Breakfasts with the Management" was deployed through digital means with the participation of employees from all Units. In addition, the initiative "Executive Meetings" took place with an extended participation from members of the management team. At the same time, the top management conducted a number of "Virtual Visits" to regional markets throughout Greece, under the special circumstances of the pandemic crisis with the aim to strengthen the "open line" communication with the Network at a national level.

Support at work - HR4U

The call center "HR4U" supports the employees of the Bank and responds daily at each employee's request, taking all the necessary actions for their best service. In 2020, more than 41,000 requests were seen to HR4U. Topics cover a wide range of questions about benefits and programs, as well as urgent needs, such as blood or platelets for employees and / or their families. More than 6,600 requests were processed for issues related to the Covid-19 pandemic.

Recognizing and Rewarding Employees

In the greater scope of Recognition and Reward, the Bank has established the "Sto Epikentro" awards, comprised of the "Customer Centricity", "Collaboration" and "Innovation" categories which are in alignment with the Bank's culture, corporate values and strategy. In 2020, the winners of the aforementioned competition were announced and prizes were awarded to more than 170 distinguished employees. Within the same framework, the Bank recognizeslong-term commitment and awards employees with 15 and 25 years of service within the Group. Under the same umbrella of recognition and reward, for the last 19 years, Eurobank has recognized and rewarded over 2,400 students of secondary and higher education through the scheme "Awarding Excellence". Through this scheme, the Bank invests in the young generation and recognizes excellence in achievement for the children of all employeesthat have outperformed at upperschool and university. The scheme also applies to all bank employees that have undergone and topped in postgraduate degrees during their tenure in the organization. The Bank traditionally designs and implements initiatives that support employees and their families. In 2020, among others, the following initiatives were implemented: gift vouchers to more than 2,600 children of employees and an annual Christmas drawing contest for all of them. In addition, art workshops were organized on a digital platform with the support of professional artists and teachers, whereby 285 children from all over Greece participated. In the context of giving back to society, Eurobank has established and supports the "Team Up" initiative. This is an employee volunteerism program that has been active in the organization since 2018. Up to 2019, 726 employees joined the group while over the last 2 years the team accounts for 16 individual events and over 1,400 volunteer man-hours. In 2020, due to the pandemic conditions, only 2 initiaves took place. Specifically, at Easter, 230 candles were purchased in support of the Amymoni Institution. The Easter candles were offered to children aged 2.5-5.5 years who are hosted at the Model National Nursery in Kallithea. At Christmas, € 15,000 was offered to support 4 Social Bodies (Affection - Association of Friends of Children with Cancer, Amymoni, SOS Children's Villages and Athens Nursing Home).

Labour Unions

The Group respects employees' constitutional right to membership in Labour Unions. Six such Unions are currently active within the Bank, representing 88.5% of the staff, i.e. 6,152 employees. The most multitudinous of these Unions is recognized as the official representative Union in labour negotiations with the Bank's Management. All employees of the Bank are employed full-time and covered by collective labour agreements (industry-wide and enterprise-level), while labour relations are regulated by the current laws and the Bank's Statute of Internal Service. Furthermore, the Bank's Management cooperates with the labour unions and supports the scheduled working meetings in order to strengthen the dialogue and to monitor the developments in the working environment.

Corporate Social Responsibility

Since its formation, Eurobank has embraced social responsibility activities, which address the concerns of society and local communities. In this context, corporate social responsibility is based in the following pillars:

Supporting society /Supporting society against Covid-19 pandemia

In 2020 in line with the national effort, to cope with the pandemic crisis and actively support the Greek Public Health System in the battle against covid-19, Eurobank consulted with the Greek Ministry of Health and EKAPY, the National General Authority for Health Supplies, to offer healthcare equipment and material, under the instructions of the Authorities.

Eurobank recognised the invaluable work of the Hellenic Fire Service and helped tip the scales in their favour in their intense and constant fight against fire, natural disasters and other emergencies. Eurobank contributed to their heroic efforts by donating €546,000 in equipment, and sponsored premises renovation for the 6th Cohort of Hellenic Army Academy, at Vari. Following the large destructive fire of east Attika in July 2018, Eurobank implemented additional initiatives for supporting and assisting reconstruction of the affected areas. Also, Eurobank supports a significant number of non-governmental organizations and institutions supporting mainly children and vulnerable population groups. Additionally, the Eurobank actively promotes cultural and athletic events throughout the country.

Education and excellence

Education significantly shapes society and the economy both through establishing moral standards and providing the new generation with knowledge and setting competencies. In this context, Eurobank has been running since 2003, a programme entitled, "The Great Moment for Education", in which the top high school graduates from all over the country are awarded every year. By 2020, the 18th year of its operation Eurobank has awarded 19,453 top pupils throughout the country.

Access to financial services for all /Financial inclusion

Eurobank collaborates with Action Finance Initiative "AFI" within the framework of the programme EaSI for employment and social innovation, to provide micro-credit facilities (up to €12,500) to support the long-term unemployed, vulnerable social groups and business people with limited access to bank loans, giving them the opportunity to create their own job (selfemployment) or develop small businesses and create new jobs. Eurobank has offered financing to 364 businesses amounting €2.9m in total, in cooperation with AFI. The financing is used to meet working capital needs, capital for investments in fixed assets, as well as capital for investments in intangible fixed assets.

Digital literacy and inclusion

Eurobank launched "Eurobank Digital Academy for Business", a resource center on digital skills for Greek companies that treat technology as a key enabler and digital transformation as a growth strategy and a source of competitive edge. Since 2019, 9 events have been held with 280 participations. Eurobank has created a special service line for access to its digital channels dedicated to digitally illiterate elder groups.

Supporting entrepreneurship and innovation

Eurobank actively contributes to economic growth and recognizes the importance of entrepreneurship as a major lever for the expansion of the Greek economy. It focuses on supporting the extroversion of Greek businesses and encouraging new business initiatives. In this context, Eurobank has developed the operation of Exportgate, an international trade portal that promotes the business networking of Greek and Cypriot companies worldwide.

Eurobank, in strategic partnership with Banco Santander for Global Trade, has joined the "Trade Club Alliance", the First Global Digital Business Interconnection Network and within this framework, designs and implements actions contributing to the enhancement of extraversion through trade missions (Trade Corridors). In 2020, given the global pandemic crisis, cohosted the first interactive digital event TCA Virtual Connect. Since 2016, Eurobank, in partnership with Grant Thornton, established the Growth Awards to award business excellence as a growth leverage of the Greek economy. Up to now, the 4 Growth Awards ceremonies have awarded 26 of the most dynamic Greek enterprises. More than 2,000 guests attend the award ceremony every year, 4 internationally renowned speakers have been hosted, and around 80 enterprises apply every year. The Award Committee is consisted of 19 distinguished individuals from the Greek business and academic arena.

In the area of innovative youth entrepreneurship, the Bank, in collaboration with Corallia developed the "egg-enter•grow•go" ("egg") , a comprehensive business incubation and acceleration program. Since 2013 "egg" is continuously helping the Greek startup community to improve competitiveness in a challenging global market, under three main pillars extroversion, financing and business networking and it has been playing a crucial role in shaping the Greek startup scene, boosting innovative entrepreneurship through the egg Start-Up (incubator) and egg Scale-Up (accelerator) platforms. In particular, its business and social footprint is reflected in the following:

a) 1,000 people have been hosted by egg
b) 245 startups have been integrated in it
c) 130 startups formed a legal entity and 87of these had a combined turnover of €9.6 million
d) 33 companies have applied for patents
e) 58 businesses have travelled to the largest technology ecosystems worldwide
f) €12m have been invested in egg accelerator by Eurobank
g) €2.5m is Eurobank financing to 40 egg startups
h) €10.2m in equity funding have been received by 30 businesses
i) €75k have been distributed by Eurobank as cash prizes to the egg startups
j) €80k have been donated to NGOs by the egg startups

In this context, Corporate Social Responsibility actions are described in the Annual Report 2020-Business and Sustainability edition, which will be published on www. eurobankholdings.gr.

Protection of environment

The sustainable business growth is an essential part of the corporate culture of the Group. As a financial group, it is aware of the direct and indirect environmental impacts of its operations and therefore the Group seeks and sets specific objectives and targets for the optimal use of natural resources, the minimization of waste production, the protection of the environment, the mitigation and adaptation to climate change and the protection of biodiversity and ecosystems. Moreover, the Group encourages its customers, suppliers, employees, shareholders, stakeholder groups and the society at large, towards the adoption of sustainability best practices in accordance with International Organizations' Guidelines and Initiatives.

The Group is committed to minimize its environmental footprint and to promote green economy. In this context, the Group implements a Sustainability Policy, an Environmental Policy and an Energy Management Policy, towards the protection of the environment in all aspects of its operations. Furthermore, the Group within the framework of the implementation of the

Environmental Policy, has established a Green Procurement Policy, aiming to evaluate and select suppliers based on environmental criteria.

In the context of these policies, the Group implements certified management systems, in accordance with International Standards, such as a Quality Management System (ISO 9001), an Environmental Management System (ISO 14001, EMAS) and an Energy Management System (ISO 50001). The implementation of these management systems is supported by relevant elearning training programs. Additionally, for the integration of the Environmental and Social (E&S) issues into its business model, the Group implements an Environmental and Social Management System (ESMS) in accordance, among others, with the requirements and expectations of Group's institutional investors, shareholders and other stakeholders. The responsibility of the sustainable development and environmental issues is assigned to the Group Environmental and Sustainability Committee, chaired by a Deputy Chief Executive Officer.

The Group is actively involved in a series of International and European Initiatives for environmental protection, sustainable development and responsible entrepreneurship such asthe United Nations Environment Program Finance Initiative (UNEP FI), the EU Eco-Management and Audit Scheme (EMAS). The Group is also a member of the standing Energy Efficiency Financial Institutions Group (EFFIG) established by the European Commission to finance energy efficiency. Additionally, it participates at the Sustainable Development Committee of the Hellenic Bank Association, the Hellenic Network for Corporate Social Responsibility (CSR Hellas) and as an ambassador at the Sustainable Greece 2020 Initiative.

In September 2019, Eurobank as a Founding Signatory Bank affirmed its commitment to play an active role in the implementation of the United Nations Global Sustainable Development Goals (SDGs) and the Paris Agreement on Climate Change, signing the Responsible Banking Principles, that were developed by the global community through UNEP FI, and set the framework for the future development of a sustainable banking system with a strong positive mark on society and the environment. To this end, and with increasing progress and global interest in Environmental, Social and Governance (ESG) issues, in 2020 the Bank started a project with an external consultant on identifying the most positive and negative impacts of its operation, while setting goals, following the timetable, the requirements and the implementation framework of the Principles of Responsible Banking. The goal of this Project is to strengthen the existing Bank strategy for sustainability and climate change, based on itsstrategic goals, as well as the best practices of the sector. This project also includesthe evaluation of the current strategy regarding the degree of alignment with the United Nations Sustainable Development Goals (SDGs) and other principles/ initiatives (Task Force on Climate – related Financial Disclosures – TCFD, Responsible Finance and the upcoming EU's legislation, ESMS) as well as with applicable KPIs for the process measurement of setting performance and sustainability goals.

The integration of risks and sustainability factors relevant with the climate, in the strategy and investment decisions of the Bank, consist of, among others, commitment of both the clients and shareholders in sustainable financing, taking into account the outcome/ financial returns of «green» banking products and initiatives.

In 2020, the Bank, at the Bravo Sustainability Awards, was distinguished for the "Sustainable Development at Eurobank" initiative in the "Bravo Governance" pillar, which rewards the overall contribution for sustainable development, as well as the pillar "Bravo Environment" for the "Electrical and Electronic Equipment Management Program" initiative. Moreover, the Bank was evaluated in the context of its participation in the Sustainability Performance Directory, examining its holistic business approach in Sustainable Development issues, resulting in the Bank being included in the leading team of Sustainability Performance Directory 2020 companies: The Most Sustainable Companies in Greece, and specifically in the level of Top Sustainable Companies.

Additionally, Eurobank remains a constituent of the Financial Times Stock Exchange 4Good (FTSE4GOOD) Emerging Index. The Group is also actively involved in the development of green products and services such as the WWF VISA, the "Green" Home Loan, and the Renewable Energy Investment Loan as well as in issuing e-Statements to reduce its environmental footprint. The environmental performance, with respect to the improvement of the operational environmental footprint, is monitored through specific environmental indicators in order to identify any deviations and corrective actions, and is included in the Annual Corporate Responsibility Report and in the Environmental Report (EMAS). It is noted that this Environmental Report (EMAS) is verified by a certification body.

In this context, in 2020 total energy consumption decreased by 6.55% compared to 2019, while total greenhouse gas emissions in carbon equivalents (tCO2e) decreased by 9.72% in 2020, compared to 2019. Overall, during the period between 2014 (baseline) and 2020, the total greenhouse gas emissions in tCO2e were decreased by 67.86%. It should be noted that the fact that the targets set by the Bank for 2020 regarding reducing both total energy consumption and total greenhouse gas emissions, have already been achieved, is mainly due to the ISO 50001 certified Energy Management System implementation. For 2020, the Bank has also obtained "Guarantees of Origin" for the 93.89% of the electricity consumed, certifying the fact that it comesfrom Renewable Energy Sources(RES), while the same process will also be followed for 2021. Pertinent indicative

environmental management targets were for 2020 a 2% reduction in electricity compared to 2019, and a 30% reduction of greenhouse gas emissions for 2020 compared to the base year (2014), which were fully achieved.

The Bank calculatesthe energy intensity ratio which expressesthe energy consumed by the Bank for all its operational revenue and serves in monitoring its energy performance in relation to activities scale. The ratio, combined with absolute energy consumption, assists in adjusting the energy performance of the Bank to its activities. In 2020 the ratio was at 30.99 kWh/m€ (2019: 37.22 kWh/m€) reduced by 16.74% compared to 2019. The aim of the Bank is to reduce its energy needs compared to its activities in the coming years. The Bank has also certified 19 buildings with the third party green building certification methods of "Leadership in Energy and Environmental Design - LEED" (level: gold & platinum) and "Building Research Establishment Environmental Assessment Method – BREEAM" (scale: good, very good & excellent), thus demonstrating Eurobank's excellent working environment.

In 2020, in the context of implementation of general measures to contain the Covid-19 expansion, the Bank set special labor instructions adopting measures such as teleworking and physical presence restriction. These measures contributed to further electricity saving and especially in administration buildings where there is concentration of large number of employees, as well as large equipment facilities. The Bank pays particular attention to water conservation, implementing measures such as installing specialsystemsfor water flow control in watersupply facilities. In 2020, the water consumption amounted to 54.691 m3 (2019: 75.973 m3), which represents a reduction of 28% compared to 2019.

The Bank, in the context of reducing its waste from its operations, has initiated a completed action plan for the reduction of paper consumption and the full digitalization of its operations, as indicatively:

a) Use of tablets in the branches: The vast majority of the transactions, which are made in the branches, are now being processed without physical documents.
b) Replacement of printers: The replacement process of all printers of the Bank with state of the art machinery has begun, with lower consumption energy.
c) Reduction of physical statements: The Bank encourages all its customers to choose the electronic receiving of their statements through e-banking.

As a result of the above, in 2020 the paper supply amounted to 247 tons and represented a reduction of 27.97% compared to 2019, while the corresponding consumption per employee decreased by 20.58%. The paper supply reduction compared with the base year 2014 is approximately 57%. In addition, the increase in the use of the e-Statement service was significant in 2020 as well, as about 320,000 more e-Banking users chose to be informed only through electronic account statements, resulting in the discontinuation of around 940,000 more physicalstatements. Since the start of the e-Statementservice, about 1.25 million customers have discontinued postal delivery of around 3.2 million physical statements. The Bank's savings from the discontinuation of statement deliveries through the post are also substantial and amount to more than € 18 million since the service became available.

Furthermore, in May 2020, the Bank introduces, first in the Greek market, a new generation of cards made from ecological, biodegradable material, adopting international environmental protocols in banking, including the services and products provided. This product is exclusively promoted via Eurobank in the Greek market and proves the Bank's long standing commitment to promote environmental culture. Since May 2020, all new Eurobank debit cards for individuals and businesses, but also those debit cards that are renewed or reissued, are made of biodegradable material. At the same time, forms, envelopes and letterheads used to send the cards, bear the certification and seal of the international, non-profit organization FSC, thus ensuring that they come from responsibly managed forests, controlled sources, recycled materials or a combination thereof.

The Annual Reports of Business and Sustainability will be available at the website (www.eurobankholding.gr), and the Environmental Reports (EMAS) will be available at the website (www.eurobank.gr).

Actions against corruption and bribery incidents

The Group is committed to pursuing the fundamental values of integrity, transparency and accountability. It is also committed to safeguarding its reputation and client base.

The Group follows best business practices, having accepted and integrated in its culture the ten principles of the UN Global Compact. The 10th principle on Anti-Corruption states that "Businesses should work against corruption in all its forms, including extortion and bribery". The Group has adopted a zero tolerance approach against all types of fraud, including bribery. In accordance with the relevant legislation, the Group prohibits bribery in any form either direct or indirect (through a third party). The principle of zero tolerance applies to all staff and prohibits all forms of bribery, whether active or passive, direct or indirect and is also reflected in contractual documents adopted when entering into relationships with third parties, either natural or legal.

In this context, the Group has adopted the following policies and proceduresto govern the treatment of bribery and corruption cases encountered:

a) Code of Conduct and Ethics
b) Anti Bribery & Corruption Policy
c) Policy for Reporting Unethical Conduct
d) Client Entertainment and Gifts Policy
e) Management of Sponsorships and Donations

Recognizing that any involvement in cases of bribery not only constitutes a crime, but also reflects adversely on its reputation and client base, the Group takes the following measures aimed at limiting its exposure to bribery:

a) Setting out a clear approach to deal with the risk of bribery.
b) Establishing a robust system of internal controls that does not tolerate bribery and corruption.

Group Compliance is responsible for issuing policies and procedures to combat bribery and corruption cases. Each unit of the Bank is responsible for complying with the existing policies. The Market & Internal Conduct Division of Group Compliance carries out risk assessment exercises on anti-bribery and anti-corruption issues and performs specialized monitoring exercises for potential violations. The Forensic Audit Division of Internal Audit investigates all cases of suspected internal fraud / corruption.

Related party transactions

As at 31 December 2020, the Group's outstanding balances of the transactions and the relating net income / expense for 2020 with (a) the key management personnel (KMP) and the entities controlled or jointly controlled by KMP are: compensation €7.8m, receivables €5.0m, liabilities €25.1m, guarantees received €0.02m, guarantees issued €0.01m, net expense €14.1m, (b) the Fairfax group are: receivables €11.0m, liabilities €0.2m, net income €9.0m and (c) the associates and joint ventures are: receivables €94.3m, liabilities €133.9m, guarantees issued €2.0m net expense €47.1m.

At the same date, the Company's outstanding balances of the transactions and the relating net income / expense for 2020 with (a) the KMP and the entities controlled or jointly controlled by KMP are: compensation €1.8m and net expense €3.1m, (b) the Fairfax group are: net income €1.1m, (c) the associates and joint ventures are: net expense €2.1m, and (d) the subsidiaries are: receivables €957m, liabilities €0.4m and net income €20.8m.

In addition, as at 31 December 2020, the Bank'ssubgroup outstanding balances of the transactions and the relating net income / expense for the period 20 March – 31 December 2020 with (a) the key management personnel (KMP) and the entities controlled or jointly controlled by KMP are: compensation €5.9m, receivables €5.0m, liabilities €25.1m, guarantees received €0.02m, guarantees issued €0.01m, net expense €11.0m, (b) the Fairfax group are: receivables €11.0m, liabilities €0.2m, net income €6.6m, (c) the associates and joint ventures are: receivables €94.3m, liabilities €133.8m, guarantees issued €2.0m net expense €44.6m and (d) the Eurobank Holdings S.A.: receivables €0.4m, liabilities €968m, net expense €33m.

All transactions with related parties are entered into the normal course of business and are conducted on an arm's length basis. Further information is provided in the note 46 to the consolidated financial statements and note 23 to the financial statements of the Company.

Corporate Governance Statement

Eurobank's Corporate Governance Code and Practices are on the website (www.eurobankholdings.gr). The Corporate Governance Statement attached herewith, is an integral part of the Directors' Report.

12 April 2021

Georgios Zanias Fokion Karavias Chairman Chief Executive Officer

APPENDIX

Definition of Alternative Performance Measures (APMs) in accordance with European Securities and Markets Authority (ESMA) guidelines, which are included in the Report of Directors/Financial Statements:

a) Loans to Deposits ratio: Loans and advances to customers at amortised cost divided by due to customers at the end of the reported period,
b) Pre-Provision Income (PPI): Profit from operations before impairments, provisions and restructuring costs as disclosed in the financial statements for the reported period,
c) Core Pre-provision Income (Core PPI): The total of net interest income, net banking fee and commission income and income from non banking services minus the operating expenses of the reported period,
d) Net Interest Margin (NIM): The net interest income of the reported period, annualised and divided by the average balance of continued operations' total assets (the arithmetic average of total assets, excluding those related to discontinued operations', at the end of the reported period, at the end of interim quarters and at the end of the previous period),
e) Fees and commissions: The total of net banking fee and commission income and income from non banking services of the reported period,
f) Income from trading and other activities: The total of net trading income, gains less losses from investment securities and other income/ (expenses) of the reported period,
g) Cost to Income ratio: Total operating expenses divided by total operating income,
h) Adjusted net profit: Net profit/loss from continuing operations after deducting restructuring costs, goodwill impairment, gains/losses related to the transformation plan and income tax adjustments,
i) Non-performing exposures (NPEs): Non Performing Exposures (in compliance with EBA Guidelines) are the Group's material exposures which are more than 90 days past-due or for which the debtor is assessed as unlikely to pay its credit obligations in full without realization of collateral, regardless of the existence of any past due amount or the number of days past due. The NPEs, as reported herein, refer to the gross loans at amortised cost except for those that have been classified as held for sale,
j) NPEs ratio: NPEs divided by gross loans and advances to customers at amortised cost at the end of the reported period,
k) NPEs formation: Net increase/decrease of NPEs in the reported period excluding the impact of write offs, sales and other movements,
l) NPEs Coverage ratio: Impairment allowance for loans and advances to customers, including impairment allowance for credit related commitments (off balance sheet items), divided by NPEs at the end of the reported period,
m) Provisions (charge) to average net loans ratio (Cost of Risk): Impairment losses relating to loans and advances charged in the reported period, annualised and divided by the average balance of loans and advances to customers at amortised cost (the arithmetic average of loans and advances to customers at amortised cost, including those that have been classified as held for sale, at the end of the reported period, at the end of interim quarters and at the end of the previous period),
n) Return on tangible book value (RoTBV): Adjusted net profit divided by average tangible book value. Tangible book value is the total equity excluding preference shares, preferred securities and non controlling interests minus intangible assets.
o) Texas Ratio: Non-performing exposures (NPEs) divided by the sum of impairment allowance for loans and advances to customers and Common Equity Tier 1.

Definition of capital and other selected ratios in accordance with the regulatory framework, which are included in the Report of Directors/Financial Statements:

a) Total Capital Adequacy ratio: Total regulatory capital as defined by Regulation (EU) No 575/2013 as in force, based on the transitional rules for the reported period, divided by total Risk Weighted Assets (RWA). The RWA are the Group's assets and off-balance-sheet exposures, weighted according to risk factors based on Regulation (EU) No 575/2013, taking into account credit, market and operational risk,
b) Common Equity Tier 1 (CET1): Common Equity Tier I regulatory capital as defined by Regulation (EU) No 575/2013 as in force, based on the transitional rules for the reported period, divided by total RWA,
c) Fully loaded Common Equity Tier I (CET1): Common Equity Tier I regulatory capital as defined by Regulation No 575/2013 as in force, without the application of the relevant transitional rules, divided by total RWA.
d) Liquidity Coverage Ratio (LCR): The total amount of high quality liquid assets divided by its net liquidity outflows for a 30-day stress period.

The following table presents the components of the calculation of the above APMs, which are derived from the Company's consolidated financial statements for the year ended 31 December 2020 and Eurobank Ergasias S.A. consolidated financial statements for the year ended 31 December 2019:

Components of Alternative Performance Measures
	FY20	FY19
Net Interest Income ⁽¹⁾	1,349	1,377
Fees and commissions	384	354
Total Operating income ⁽²⁾	2,401	1,844
Total Operating income, excluding the gain on FPS disposal⁽²⁾	2,181	-
Total Operating expenses ⁽³⁾	(869)	(901)
Pre-provision income (PPI)	1,532	943
Pre-provision income (PPI), excluding the gain on FPS disposal	1,312	-
Core Pre-provision income (Core PPI)	865	830
Net profit/(loss) from continued operations	(1,213)	129
Loss on Cairo transaction	(1,508)	-
Gain on disposal of FPS (before tax)	219	-
Gain on disposal of FPS (after tax)	174	-
Restructuring costs, after tax	(103)	(66)
Goodwill impairment loss	(160)	(62)
Write-down of deferred tax assets (DTA)	(160)	-
Non performing exposures (NPEs)	5,724	12,950
Impairment losses relating to loans and advances	(2,081)	(624)
Impairment losses for loans, excluding the cairo transaction loss	(572)	-
Due to customers	47,290	44,841
Gross Loans and advances to customers at amortized cost	40,874	44,406
Impairment allowance for loans and advances to customers	(3,477)	(7,099)
Impairment allowance for credit related commitments	(66)	(64)
Due to customers (Greek operations)	34,189	32,444
Gross Loans and advances to customers at amortized cost (Greek operations)	32,829	36,857
Impairment allowance for loans and advances to customers (Greek operations)	(3,227)	(6,840)
Average balance of continued operations' total assets	66,550	61,603
Average balance of loans and advances to customers at amortised cost ⁽⁴⁾	37,539	36,692

(1) 4Q2020 NIM: Net interest income of the fourth quarter 2020 (€329m), annualised, divided by the average balance of continued operations' total assets (€67,591m).

(2) International Operations: Operating income: €474m (2019: €515m). Greek operations: Operating income: €1,707m, excluding the gain on FPS disposal of €219m (2019: €1,329m).

(3) International Operations: Operating expenses: €226m, (2019: €217m). Greek operations: Operating expenses: €643m, (2019: €684m).

(4) The average balance of loans and advances to customers measured at amortized cost, has been calculated as the arithmetic average of their balances at the end of the reporting period (31 December 2020: €37,397m), at the end of interim quarters (30 September 2020: €36,960m, 30 June 2020: €38,267m, including cairo senior notes of €2,341m and cairo loss of €1,509m and 31 March 2020: €37,763m), and at the end of the previous period (31 December 2019 €37,307m).

Source of financial Information

The Directors' Report includes financial data and measures as derived from the Company's consolidated financial statements for the year ended 31 December 2020 and Eurobank Ergasias S.A. consolidated financial statements for the year ended 31 December 2019, which have been prepared in accordance with International Financial Reporting Standards(IFRS). In addition, it includes information as derived from internal information systems, consistent with the Group's accounting policies, such as the selected financial information for the Group's two main reportable segments a) Greek Operations, which incorporate the business activities originated from the Company, the Bank and the Greek subsidiaries and b) International Operations, which incorporate the business activities originated from the banks and the local subsidiaries operating in Bulgaria, Serbia, Cyprus and Luxembourg (as described at the relevant section on page 8).

CORPORATE GOVERNANCE STATEMENT 2020

1. Demerger of Eurobank Ergasias S.A.

On 20 March 2020, the demerger of Eurobank Ergasias S.A. (Eurobank Ergasias or Demerged Entity) through the banking sector's hive down and its transfer to a new credit institution that has been established under the corporate name "Eurobank S.A." (Eurobank or Bank) was completed. Following the above, the corporate name of the Demerged Entity has been amended to "Eurobank Ergasias Services and Holdings S.A." (Company, Eurobank Holdings, Holdings or HoldCo). The Company holds the 100% of the share capital of the Bank and has maintained activities that are mainly related to the strategic planning of the administration of non-performing loans and the provision of services to the group companies and third parties while Eurobank substituted Eurobank Ergasias, by way of universal succession, to all the transferred assets and liabilities of the hived down banking sector.

As a result of the hive down, Eurobank and the subsidiaries contributed by the Demerged Entity, formed the new reporting entity Eurobank S.A. group (hereafter Eurobank group). The Company and its subsidiaries (the Group), consisting mainly of Eurobank group, are active in retail, corporate and private banking, asset management, treasury, capital markets and other services. The Group mainly operates in Greece and in Central and South-eastern Europe.

Given that the Group consists mainly of Eurobank group, the present Corporate Governance Statement outlines how the principles stipulated by the Code were applied to Eurobank Holdings and Eurobank during 2020.

2. Corporate Governance Code and Practices

In compliance with the Greek legislation as well as with the contractual obligations to the Hellenic Financial Stability Fund (HFSF) and based on the international best practices on corporate governance, Eurobank Holdings has adopted and implements a Corporate Governance Code (Code), which describes the main corporate governance principles and practices adopted by the Group. The Code and relevant corporate governance practices are available on the HoldCo's website (www.eurobankholdings.gr).

3. Board of Directors1

3.1 General

The HoldCo is headed by a Board of Directors which is collectively responsible for the long-term success of the HoldCo. The Board exercises its responsibilities effectively and in accordance with the Greek legislation, international best practices and the Bank's and HoldCo's contractual obligations to the HFSF under the Tripartite Relationship Framework Agreement (TRFA) signed between the HoldCo, the Bank and the HFSF.

The Board's role is to provide entrepreneurial leadership to the Group within a framework of prudent and effective controls which enables risk to be assessed and managed. The Board sets the Group's strategic goals, ensures that the necessary financial and human resources are in place for the Group to meet its objectives and reviews management performance. The Board sets the Group's values and standards and ensures that its obligations to its shareholders and others are understood and met. All Directors must act in what they consider to be the best interests of the Group, consistent with their statutory duties.

3.2 Composition of the Board

Eurobank Holdings

The members of the Board are elected by the HoldCo's General Meeting which also determines the exact number of the directors, within the limits of the Law and of the HoldCo's Articles of Association, their term of office and designates the independent non-executive directors. The current BoD was elected by the Annual General Meeting (AGM) of the Shareholders held on 10 July 2018 for a three years term of office that will expire on 10 July 2021, prolonged until the end of the period the AGM for the year 2021 will take place. Further to that:

‐ Mr. Theodoros Kalantonis, submitted his resignation, effective as of 3 April 2020.
‐ The BoD by its decision dated 8 April 2020, appointed Ms. Alice Gregoriadi and Ms. Irene Rouvitha Panou as their new independent non-executive members, in replacement of the resigned independent non-executive members Mr. Richard Boucher and Mr. Nikolaos Bertsos, their resignations being effective as of 8 April 2020, and their term of office will expire concurrently with the term of office of the other members of the BoD.
‐ Mr. George Μyhal, submitted his resignation, effective as of 10 December 2020. The BoD by its decision the same date appointed Ms. Cinzia Basile as new independent Non-Executive Director, in replacement of the resigned independent non-executive member Mr. George Myhal for an equal term to the remaining term of the resigned member.

¹ Information regarding the Board's composition is included in note 48 and note 47 of the consolidated accounts of HoldCo and Eurobank respectively and short biographical details of its members may be found at the HoldCo/Bank websites (www.eurobankholdings.gr & www.eurobank.gr)

‐ The BoD by its decision dated 10 December 2020 appointed Mr. Andreas Athanassopoulos as new executive Director in replacement of the resigned executive Director Mr. Theodoros Kalantonis for an equal term to the remaining term of the resigned member.
‐ The BoD by its decision dated 28 January 2021, appointed Ms Efthymia Deli as the new representative of the HFSF to Eurobank Holdings BoD in replacement of the resigned Mr. Dimitrios Miskou, according to the provisions of Law 3864/2010 and the TRFA.

Eurobank

In the article 18 of the final and transitional provisions of the articles of association of Eurobank S.A. it is provided, among others, the composition and term of office of its first Board of Directors. In particular, the period until the AGM of the shareholders takes place, which shall be convoked until September 10th, 2021 the latest, has been defined as the term of office of the first Board of Directors or earlier until the election of new Board of Directors by Extraordinary General Meeting of the Bank's shareholders.

Further to that:

‐ Mr. Theodoros Kalantonis, submitted his resignation, effective as of 3 April 2020.
‐ The BoD by its decision dated 8 April 2020, appointed Ms. Alice Gregoriadi and Ms. Irene Rouvitha Panou as their new independent non-executive members, in replacement of the resigned independent non-executive members Mr. Richard Boucher and Mr. Nikolaos Bertsos, their resignations being effective as of 8 April 2020, and their term of office will expire concurrently with the term of office of the other members of the BoD.
‐ Mr. George Μyhal, submitted his resignation, effective as of 10 December 2020. The BoD by its decision the same date appointed Ms. Cinzia Basile as new independent Non-Executive Director, in replacement of the resigned independent non-executive member Mr. George Myhal for an equal term to the remaining term of the resigned member.
‐ The BoD by its decision dated 10 December 2020 appointed Mr. Andreas Athanasopoulos as new executive Director in replacement of the resigned executive Director Mr. Theodoros Kalantonis for an equal term to the remaining term of the resigned member.
‐ The BoD by its decision dated 28 January 2021, appointed Ms Efthymia Deli as the new representative of the HFSF to Eurobank's BoD in replacement of the resigned Mr. Dimitrios Miskou, according to the provisions of Law 3864/2010 and the TRFA.

It is noted that, for efficiency reasons, Eurobank's BoD has the same composition as HoldCo's BoD.

Following the above, the current Board, as of the date of approval of the here-in Statement, consists of thirteen (13) Directors of whom, four (4) executives, three (3) non-executives, five (5) independent non-executives and one (1) representative of the HFSF, who has been appointed (as non-executive Director) in accordance with relevant legal requirements, as outlined below:

		Eurobank Holdings		Eurobank
		First appointment	End of Term	First appointment	End of Term
Georgios P. Zanias	Chairperson, Non-Executive Director	Mar. 2019	2021	Mar. 2020	2021
Georgios K. Chryssikos	Vice-Chairperson, Non-Executive Director	Jun. 2014	2021	Mar. 2020	2021
Fokion C. Karavias	Chief Executive Officer	Jun. 2014	2021	Mar. 2020	2021
Stavros E. Ioannou	Deputy Chief Executive Officer	Apr. 2015	2021	Mar. 2020	2021
Konstantinos V. Vassiliou	Deputy Chief Executive Officer	July 2018	2021	Mar. 2020	2021
Andreas D. Athanassopoulos	Deputy Chief Executive Officer	Dec. 2020	2021	Dec. 2020	2021
Bradley Paul L. Martin	Non-Executive Director	Jun. 2014	2021	Mar. 2020	2021
Rajeev K. L. Kakar	Non-Executive Independent Director	July 2018	2021	Mar. 2020	2021
Jawaid A. Mirza	Non-Executive Independent Director	Jun. 2016	2021	Mar. 2020	2021
Alice K. Gregoriadi	Non-Executive Independent Director	Apr. 2020	2021	Apr. 2020	2021
Irene C. Rouvitha-Panou	Non-Executive Independent Director	Apr. 2020	2021	Apr. 2020	2021
Cinzia V. Basile	Non-Executive Independent Director	Dec. 2020	2021	Dec. 2020	2021
Efthymia P. Deli	Non-Executive Director, HFSF Representative	Jan. 2021	2021	Jan. 2021	2021

There are no restrictions in the re-election and cessation of Directors in the HoldCo's and Eurobank's Articles of Association. In all cases of members whose membership has lapsed, the Board is entitled to continue the management and representation of the HoldCo and Eurobank, without being obliged to replace the lapsed members, provided that the number

of the remaining members exceeds half of the number of the members prior to the event that led to the lapse of their membership and, in any case, is not less than three (3).

According to the HoldCo's and Eurobank's Articles of Association, the Board may consist of three (3) to fifteen (15) members, while, under the TRFA, this range has been specifically set to be between seven (7) and fifteen (15) members (including the representative of the HFSF). In addition, according to the TRFA, (a) the number of the Board's members must always be odd, (b) the majority of the directors must be non-executive members with at least half of the non-executive members (rounded to the nearest integer) and in any case not less than three (3) (excluding the representative of the HFSF), being independent non-executive members in accordance with the provisions of Law 3016/2002 on corporate governance and the European Commission Recommendation 2005/162/EC and (c) the Board should include at least two (2) executive members. For any differentiations from TRFA's provisions the HFSF's prior consent should be received. Furthermore, according to the HFSF corporate governance review criteria developed as per the relevant provisions of Law 3864/2010, the target size of the Board should be up to thirteen (13) members.

3.3 HFSF and Tripartite Relationship Framework Agreement (TRFA)

The first economic adjustment programme for Greece required the establishment of the HFSF, funded by the Greek government out of the resources made available by the IMF and the EU, to ensure adequate capitalisation of the Greek banking system. The HFSF was established in July 2010 and its duration, originally set until 30 June 2017, was extended until 30 June 2020 and most recently until 31 December 2022, although this may be further extended by the Minister of Finance if the extension is necessary to enable the HFSF to achieve its objectives.

In the Company's case, the support provided to it by the HFSF was through the issuance of new ordinary shares covered entirely by the HFSF with the contribution of bonds issued by the EFSF and owned by the HFSF, as resolved by the Company's Extraordinary General meeting on 30 April 2013.

Reflecting the HFSF's status as a shareholder of Eurobank Holdings (it currently owns 1.4% of Eurobank Holdings' shares), and following the completion of the demerger, Eurobank Holdings, the Bank and the HFSF are parties to a Tripartite Relationship Framework Agreement (TRFA) signed on 23 March 2020. The TRFA allows the HFSF to enforce against the Bank all the rights which it had against the former Eurobank Ergasias S.A. under an earlier Relationship Framework Agreement (RFA) between it and Eurobank Ergasias S.A.. Accordingly, the TRFA, among other matters:

regulates the corporate governance of the Bank;
monitors the implementation of the Bank's non-performing loan management framework; and
monitors the Bank's performance in relation to non-performing loan resolution.

The TRFA also (i) deals with the material obligations of Eurobank Holdings and the Bank under the RFA, and the switch of the restricted voting rights that the HFSF currently has in Eurobank Holdings to full voting rights if those obligations are breached, (ii) requires the Bank's risk profile to be monitored against the approved Group Risk and Capital Strategy, (iii) requires the Bank to obtain the HFSF's prior written consent for its Group Risk and Capital Strategy and for its Group Strategy, Policy and Governance (relating to the management of the Bank's arrears and non-performing loans) and (iv) establishes the duties, rights and obligations of HFSF's Representative in the Board of each of Eurobank Holdings and the Bank (see further below). The TRFA and the L. 3864/200 (HFSF Law) do not preclude, reduce or impair the ability of the management of each of Eurobank Holdings and the Bank to continue to determine independently, among other matters, their respective commercial strategy and policy and to manage the Bank's day-to-day operations.

According to the HFSF Law and the TRFA, the HFSF has the following rights:

the right to vote at the General Meetings of Eurobank Holdings only for decisions concerning (i) the amendments of the Articles of Association of Eurobank Holdings, including the increase or reduction of the capital or the corresponding authorisation to its Board, (ii) mergers, divisions, conversions, revivals, extension of term or dissolution of Eurobank Holdings, (iii) the transfer of assets (including the sale of subsidiaries) or (iv) any other issue requiring increased majority as provided for in the Greek law on Sociétés Anonymes;
the right to appoint one director (the "HFSF representative") to the Board of each of Eurobank Holdings and the Bank, to appoint the HFSF representative to their respective Audit, Risk, Nomination and Remuneration Committees and also to appoint an observer in the Board and in the Audit, Risk, Nomination and Remuneration Committees with no voting rights of each of Eurobank Holdings and the Bank;
the right to preferential reimbursement, in priority to all other shareholders from the proceeds of the liquidation of Eurobank Holdings, if it is liquidated;
free access to the books and records of each of Eurobank Holdings and the Bank for the purposes of HFSF Law, with executives or consultants of its choice;
to review the annual self-assessment of the Board and the Committees of each of Eurobank Holdings and the Bank for the purpose of identifying weaknesses and improving working methods and effectiveness and the responsibility to perform, assisted by an independent consultant of international reputation, an evaluation of their respective corporate governance framework, Board and committees, as well as their respective members; and
the right to monitor the implementation of the Bank's non-performing loan management framework and of the Bank's performance on non-performing loans resolution.

The HFSF representative has a number of rights, including to:

to call a Board meeting, a meeting of any Board committee of each of Eurobank Holdings and the Bank he is a member of and a general meeting of shareholders of Eurobank Holdings and to include items on the agenda of any of those meetings;
to veto any resolution of the Board of each of Eurobank Holdings and the Bank (i) related to dividend distributions or the remuneration policy and proposed bonuses to Board members and General Managers or their deputies (ii) which may jeopardise depositors' interests or materially affect liquidity, solvency or, in general, the prudent and orderly operation of the Bank (such as business strategy and asset/liability management), (iii) concerning corporate actions resulting in any matter for which the HFSF would have full voting rights in a shareholder meeting which may materially impact HFSF's participation in the share capital of Eurobank Holdings, or (iv) any decision related to any other veto right each time provided by the HFSF Law;
to request the postponement of a Board meeting of each of Eurobank Holdings and the Bank or the discussion of any item in order to receive HFSF's Executive Board's instructions or in case the notification of the date of a relevant Board meeting, including the agenda and the relevant material, data or information and all supporting documents with respect to the items of the agenda, are not sent at least three business days prior to such Board meeting;
to request an adjournment of any Board meeting of each of Eurobank Holdings and the Bank or the discussion of any item by up to three business days, if it finds that the material, data or information and the supporting documents submitted to the HFSF pursuant to the items of the agenda of the forthcoming relevant Board meeting are not sufficient; and
to approve the Chief Financial Officer ("CFO") of each of Eurobank Holdings and the Bank. In exercising these rights, the HFSF representative should take into account the business autonomy of each of Eurobank Holdings and the Bank.

Finally, the HFSF Law as in force, has introduced certain minimum requirements with respect to the size, the structure and the members of the Board and the Board Committees of the companies whose corporate governance framework may be assessed by the HFSF according to the relevant provisions of HFSF In particular, Board members must (i) have a minimum of ten years of experience as senior executives in banking, auditing, risk management or management of risk-bearing assets, with three years of experience, with respect to the non-executive members, as board members of a credit institution, a financial sector enterprise or an international financial institution, (ii) not serve or have been entrusted during the last four years with prominent public functions, such as heads of state or of government, senior politicians, senior government, judicial or military officials or prominent positions as senior executives of state owned corporations or political party officials, and (iii) have declared any economic connections with the credit institution prior to their appointment. In addition, the Board must comprise at least: (i) three experts as independent non-executive directors, with sufficient knowledge and international experience of at least 15 years with financial institutions of which at least three years as members of an international banking group which is not active in the Greek market unrelated to any Greek credit institution during the past decade, which shall chair all board committees, and (ii) one member with at least five years of international experience and specialisation in risk or NPL management, who shall be responsible for NPL management at board level and shall chair any special board committee for NPL management. Furthermore, and based on the provisions of article 10, par. 6 of the HFSF Law, the HFSF with the assistance of an independent consultant has developed additional criteria as to the eligibility of individual Board members.

3.4 Division of responsibilities

There is a clear division of responsibilities at the head of the HoldCo and the Bank between the proper operation of the Board and the day-to-day management and control of the HoldCo's and the Bank's business. The roles of Chairperson and CEO are not exercised by the same person.

The Executive Directors have responsibility for the day-to-day management and control of the Group and the implementation of its strategy. The non-Executive Directors are responsible for the overall promotion and safeguarding of the HoldCo's and the Bank's interests, constructively challenge and help develop proposals on strategy and approve, revise and oversee the implementation of the remuneration policy at HoldCo, the Bank and Group level. The Independent non-Executive Directors have the duty, if they consider it necessary; to submit each one of them or jointly to the General Meeting their own reports other than those of the Board on a specific subject.

3.5 Operation of the Board

The Chairperson of HoldCo/Bank's Board chairs the Board and ensures its effectiveness on all aspects of its role. He is non-executive and does not serve as Chairperson of the Audit Committee. The CΕΟ is accountable for and manages strategy development and implementation in line with the vision of the Group. He is responsible for leading the organisation to the achievement of its objectives.

The Board meets regularly every quarter and on an ad hoc basis, whenever the law or the HoldCo's and the Bank's needs necessitate it, given at least two (2) business days' notice or at least five (5) business days' notice, if the meeting is held outside the HoldCo/Bank's registered office, as per Company Law 4548/2018 provisions. The invitation must also mention with clarity the agenda subjects, otherwise a decision is taken only when all members of the Board are present or represented and nobody objects to the convocation of the meeting and to the taking of decisions. In addition, according to the TRFA provisions the Board informs the HFSF's Representative and the Observer on the activities and the decisions of the Board and to that end it shall notify to them the agenda together with the relevant supporting material at least three (3)

business days prior to the Board meeting, otherwise, unless an emergency case unforeseeable by the HoldCo/Bank exists, the HFSF Representative is entitled to request a postponement of the Board meeting which shall be resumed the earliest after three (3) business days, provided that the aforementioned documents are provided to him/her on time. In case where an item on the agenda requires, as per TRFA provisions, the prior HFSF consent, the HoldCo/Bank should not submit it for approval to the Board before HFSF consent is granted, unless otherwise agreed between the HoldCo/Bank and HFSF. For urgent matters, the Board may approve matters subject to subsequent HFSF consent.

The Board is considered to be in quorum and meets validly when at least half plus one of its members are present or represented. The number of the present or represented members is not allowed to be less than three (3). For defining the quorum any resulting fraction is omitted. Decisions of the Board are taken by absolute majority of the Directors that are present or represented. In case of parity of votes, the vote of the Chairperson of the Board does not prevail.

During 2020 the attendance details for the Board were as follows:

Company	Meetings			Average ratio of Directors' attendance
	2020	2019	2020	2019
HoldCo	23	27	98%	97%
Bank (from 20.3.2020)	22	n/a	99%	n/a

Submissions to the Board are normally circulated together with the agenda. Decisions are taken following discussions which exhaust the agenda items to the satisfaction of all Directors present. Board meetings minutes are kept by the Secretary of the Board, are approved at subsequent Board meetings and signed by all Directors present. The TRFA provides for, on an individual basis, compulsory attendance of Board members of at least 85%. Each member may miss up to 15% of individual meetings if a valid excuse is provided. Finally, the drawing up and signing of minutes by all the members of the Board of Directors or their representatives is equal to a decision of the Board of Directors, even if no meeting has preceded.

3.6 Directorships of Board members

The number of directorships which may be held by the Board members at the same time comply with the provisions of Law 4261/2014 (art. 83), according to which the Directors shall not hold more than one (1) of the following combinations of directorships at the same time: a) one (1) executive directorship with two (2) non-executive directorships; and b) four (4) non-executive directorships. This restriction is not applied to directorships within the Group. Bank of Greece (BoG) as the competent authority may authorize Board members to hold one (1) additional non-executive directorship. Based on their declared information, all members are compliant with the provisions of Law 4261/2014.

3.7 Conflicts of interest

The Group, based on the "Conflicts of Interest Policy" has adopted a series of Policies, measures and procedures that must be followed in order to prevent and manage conflict of interest situations, as encountered in the context of the Group's activities.

To avoid situations of conflicting duties, each company within the Group, segregates the executive and supervisory responsibilities of the members of the Board of Directors, including the division of the responsibilities of the Chairperson of the Board of Directors with the executive responsibilities of the CEO. More specifically, by adopting appropriate procedures, effective segregation of duties is ensured, so as to avoid cases of incompatible roles, conflicts of interest between the members of the Board of Directors, Management and Executives, but also between the aforementioned and those of the Holdings/Bank and its transacting parties, as well as the unlawful use of inside information or assets.

The Board members:

must comply with the high standards and principles of professional ethics in the performance of their duties, apply the principles of the "Conflicts of Interest Policy" and refrain from any activity or conduct that is inconsistent with it.
according to article 97 par. 1 of Company Law 4548/2018, are prohibited from pursuing personal interests that run counter to the interests of the Holdings (or the Group) and must timely and adequately disclose to the other members of the Board of Directors any personal/own interests that may arise from the Holdings' transactions which fall within their line of responsibility, as well as any other potential, perceived or actual conflict of interests that may exist between Holdings or its affiliated undertakings (under article 32 of Greek Law 4308/2014) and themselves. Furthermore, they have to disclose to the other members of the Board, any conflicts of interest between Holdings and their associated parties under article 99 par. 2 of the Company Law 4548/2018. Adequate disclosure on behalf of the Board members, as per the above, is considered the one that includes a description of both the transaction and the own interests.
must ensure the privacy and the confidentiality of non-publicly available information and refrain from behaviors that would constitute market abuse and conflict of interest.

3.8 Remuneration

Eurobank Holdings has established a Board of Directors' Remuneration Policy in line with related requirements of the Law 4548/2018 (the Law) (latest version of the Policy approved by the AGM on 28.7.2020). It has been created to satisfy the pertinent terms of the Law (articles 109, 110, 111, 112 and 114) and describes key components and considerations of the remuneration framework for the members of the Board.

It also complies with relevant stipulations of the TRFA between Eurobank Holdings, Eurobank and the HFSF. Eurobank Holdings produces, for each financial year, a Remuneration Report concerning the remuneration and other financial benefits paid to each Executive and Non-Executive Directors of the Board during the reporting financial year, in line with the requirements of Article 112 of the Law.

It is noted that due to same composition of the Board of the Eurobank Holdings with the Board of its subsidiary Eurobank and since the Directors are paid solely by one of the two, that being the Bank, any reference to the remuneration and /or the benefits payable to the Directors of Eurobank Holdings, applies to the relevant remuneration they receive as Directors of the Bank.

The 2020 Board and key management remuneration disclosure is included in note 46 of the consolidated accounts of Eurobank Holdings and in compliance with the provisions of the Company Law 4548/2018 and in order to ensure adequate transparency to the market of the remuneration structures and the associated risks, is uploaded at website www.eurobankholdings.gr.

3.9 Main issues the Board dealt with during 2020

In discharging its responsibilities for 2020 the main issues Holdco/Bank's BoDs dealt with related to:

Eurobank Holdings Bank

a) Governance:

election of new Board members and approval of Board Committees' composition,
approval of the Terms of Reference of Board Committees,
appointment of new Secretary,
preparation and convocation of the Shareholders General Meetings,
annual evaluation of the Board and the Board Committees,
CEO's performance evaluation,
approval of the BoD Diversity Policy, the Conflict of Interest Policy and the Separation Policy,
approval of the Remuneration Policy for the Directors and further submission for approval by the Annual General Meeting,
approval of the Corporate Governance Code and Practices,
regular update on Board Committees' matters,
various remuneration issues.

b) Corporate and other actions:

actions for the completion of the hive down of the banking sector of Eurobank Ergasias with the establishment of a new company pursuant to the relevant legal provisions,
acquisition of Fixed Rate Tier 2 Subordinated Instruments due 2028
Service Level Agreement (SLA) and Reverse Service Level Agreement (RSLA) with the Bank,
initiation of the process concerning the return of capital to the shareholders in kind,
actions for the completion of the share capital reduction,
issuance of medium-term notes (EMTN).
c) Capital adequacy:
- approval of the 2020 Internal Capital & Liquidity Adequacy Assessment Process (ICAAP & ILAAP 2020),
a) Governance: election of new Board members,
- establishment of the Board Digital and Transformation Committee and approval of Board Committees' composition,
- approval of the Terms of Reference of the Board Committees,
- appointment of Secretary ,
- preparation and convocation of the Bank's Shareholders General Meeting,
- CEO's performance evaluation and approval of his financial and non-financial objectives
- approval of the Remuneration Policy, the Group Subsidiary Board Remuneration Policy and the Separation Policy,
- update on Senior Executives succession plan,
- regular update on Board Committees' matters,
- various remuneration issues.

b) Corporate and other actions:

approved the following:

actions for the substitution of Eurobank Ergasias by Eurobank, by way of universal succession, to all the transferred assets and liabilities,
issuance of Fixed Rate Tier 2 Subordinated Instruments due 2028,
Service Level Agreement (SLA) and Reverse Service Level Agreement (RSLA) with HoldCo,
final agreement of the sale of 80% of FPS shares to doValue,
provision of guarantees by the Hellenic Republic addressed to the European Investment Bank ("EIB") in favour of the Bank, related to the granting of loans from EIB.

c) Capital adequacy:

approval of the securitization of the Bank's receivables from portfolios of business and other loans.

d) Business monitoring:

approval of the 2019 annual financial statements and the 2020 interim financial statements,
approval of the Annual Budget 2021 and the 3- Years Business Plan for the period 2021-2023,
discussion of business developments and liquidity.
e) Risk Management and Internal Control:
- update on significant audit and compliance issues,
- approval of Group Risk and Capital Strategy and Risk Appetite Statements,
- approval of the 2019 consolidated Pillar 3 Report (capital and risk management disclosures),
- regular briefing on Audit Committee's matters,
- update on the 2019 Annual Activity Report of the Audit Committee,
- approval of new or revised policies as per the legal or regulatory framework and internal processes,
- approval of the 2020 Group Recovery Plan.
d) Business monitoring:
- approval of the interim consolidated financial statements for the period 20 March to 30 June 2020,
- approval of the Annual Budget 2021 and the 3- Years Business Plan for the period 2021-2023,
- approval of the Group's NPE Targets for the period 2020-2022 and the NPE management Strategy,
- update on significant subsidiaries activities and strategic priorities,
- review of business developments and liquidity.
e) Risk Management and Internal Control:
- briefing on the assessment on Internal Audit Group and Group Compliance annual regulatory reports,
- update on significant audit issues
- update on significant compliance issues
- approval of amendments relevant to the Group Risk and Capital Strategy and Risk Appetite Statements,
- update on the Group Chief Risk Officer's Annual Report for the year 2019,
- update on credit related issues through various reports
- regular briefing on Risk and Audit Committees matters,
- approval of policies as per the legal or regulatory framework and internal processes,
- update on issues relevant to the Group Recovery Plan.

3.10 Evaluation of the Board's structure, size, composition and performance

The Nomination Committees of HoldCo/Bank in discharging their responsibility for the annual assessment of the structure, size, composition and performance of the Board, proceeded with the Board's evaluation for 2020.

In accordance with the Board and Board Committees Evaluation Policy, 2020 Board evaluation covered the following areas:

Board's performance in setting and monitoring strategy (including the business plan),
Board's performance in overseeing, engaging with, evaluating, incentivizing and retaining key management personnel,
Board's performance in overseeing risk management and internal control,
adequacy of the Board's profile and composition,
adequacy of Board dynamics and functioning,
role and performance of the Board Chairperson,
adequacy of Board secretarial support,
effectiveness of Board Committees.

Overall the evaluation concluded that the BoDs continued to function effectively in 2020 as in 2019. In the context of the Board's evaluation, the Board noted as issues for further attention the need for more focus on deep dive discussions on: a) long term strategic planning, also in view of Eurobank's transformation plan that is presently underway, and b) relevant HR issues, such as the methodologies used for attracting talent, the assessment, promotion and rewarding processes, the succession planning, the leadership frameworks, the salary surveys and benchmarking etc.

3.11 Directors' Induction and Continuous Professional Development Process

The new Board members appointed during 2020 have received a full and formal Induction Program whose main objectives were to (a) communicate HoldCo/Bank's vision and culture, (b) communicate practical procedural duties, (c) reduce the time taken for them to become productive in their duties, d) assimilate them as welcomed members of the Board, e) become familiar with the HoldCo/Bank's organizational structure and f) give them an understanding of HoldCo/Bank's business and strategy and the markets in which it operates, a link with the HoldCo/Bank's people and an understanding of its main relationships. Also, the new Board members, upon their appointment received a Manual of Obligations towards Supervisory Authorities and the HoldCo/Bank, aiming to inform them on their main obligations under the local regulations and the Board's procedures, while meetings and presentations were arranged with the HoldCo/Bank's Key Executives, in order for the new Directors to acquire a real overview of the HoldCo/Bank.

Furthermore, given that the HoldCo/Bank acknowledges the need to provide resources for developing and refreshing the knowledge and skills of the Directors, during 2020 and in the framework of its Continuous Professional Development program, all the Board members a) received regular updates, including reports and presentations, from senior management regarding the operations and strategic targets of business units, b) were updated on a regular basis on risk, audit, compliance, financial, human resources, legal and regulatory issues, and d) received regular and ad-hoc research and economic bulletins prepared by Eurobank's Economic Analysis and Financial Markets Research Division.

4. Board Committees

The Boards of HoldCo/Bank are assisted in carrying out their duties by Board Committees to whom they delegate some of their responsibilities. In addition, the Boards approve their terms of reference, receive regular and ad hoc reports from them and assess their performance as per the provisions of the Board and Board Committees Evaluation Policy.

According to the TRFA, the HFSF appoints its Representative as well as its Observer (who has no voting rights in the Board's Committees) or replaces them with a written request addressed to the Chairperson of the Board and their appointment is completed immediately from the receipt by the HoldCo/BoD of the HSFS's written request and no further procedures are required. Pursuant to the TRFA, the HFSF Representative has the right to participate in, request the convocation of, and include items on the agendas of the Audit Committee, Board Risk Committee, Remuneration Committee and Nomination Committee. In addition, HFSF is entitled to the assistance by an independent consultant of international reputation and established experience and expertise, to perform its own evaluation of the Board Committees, in accordance with the article 10 of L. 3864/2010 as in force.

According to the TRFA provisions, the members of the Audit, Board Risk, Remuneration and Nomination Committees should be at least three (3) and should not exceed 40% (rounded to the nearest integer) of the total number of Board members, excluding the representative of the HFSF. The Committees' Chairpersons should be independent non-executive members and shall meet the requirements provided for in Law 3864/2010. The Committees' members should be non-executives with the majority of them, excluding the representative of the HFSF, independent non-executives, except for the Audit and Board Risk Committees where 75% and 1/3, respectively, of their members (excluding the representative of the HFSF and rounded to the nearest integer) should be independent non-executives. For any deviations from the TRFA provisions, the prior consent of HFSF should be received.

It is noted that since the demerger of Eurobank Ergasias S.A. on 20.3.2020, Eurobank Holdings' Board Risk, Remuneration and Strategic Planning Committees, for which there is nor a regulatory requirement neither a business need, they are kept in idle capacity until the BoD will finally conclude on whether to abolish them or not, following the incorporation into the Greek legal framework of the new Directive (EU) 2019/878 (known as CRD V) which is expected to regulate the governance issues of the financial holdings companies (like Eurobank Holdings).

4.1 Audit Committee²

The primary function of the Audit Committee (AC) is to assist the Board in discharging its oversight responsibilities primarily relating to:

the review of the adequacy of the Internal Control and Risk Management systems and the compliance with rules and regulations monitoring process,
the review of the financial reporting process and satisfaction as to the integrity of the HoldCO's Financial Statements,
the External Auditors' selection, performance and independence,
the effectiveness and performance of the Internal Audit and of the Compliance function.

According to article 44 of the Law 4449/2017, as recently amended by Law 4706/2020, the AC could be either a Board Committee, or a mixed Committee consisted of Board members and third parties, or an independent Committee consisted exclusively from third parties. The type of the Committee, the tenure, the number and the qualifications of its members are decided by the Shareholders' General Meeting.In case the AC is a Board Committee, its composition is decided by the Board. In all other cases (mixed or independent Committee), the members are decided by the Shareholders' General Meeting.

The HoldCo/Bank's Audit Committees are Committees consisted exclusively by Board members and their compositions have been approved by the General Meeting of the Shareholders (as per the legal framework prior to the provisions of the new Law 4706/2020), following the recommendation of the Nomination Committees to the Boards. The tenure of the Committee members coincides with the tenure of the HoldCo/Bank's Boards, with the option to renew their appointment, but in any case the service in the Committee should not be more that twelve (12) years in total. The Chairperson of the Committees is appointed by the members of the Committee, while the Committee's members may also appoint a Vice Chairperson. The current Audit Committees consist of five (5) non-executive Directors, three (3) of whom are independent, including the Chairperson. One (1) of the Audit Committee members is the HFSF Representative. The HFSF appointed an Observer in the Audit Committees, in line with the requirements of the TRFA.

² Information regarding the Committee's main duties and responsibilities as well as composition are included in the Code. Additionally, information regarding current composition and short biographical details of its members may be found at the HoldCo/Bank websites (www.eurobankholdings.gr & www.eurobank.gr).

All AC members have sufficient knowledge in the field of HoldCo/Bank's activities and the necessary skills and experience to carry out their duties. The Chairperson of the Audit Committees and one (1) more member are the appointed financial/audit/risk expert members.

The Audit Committee of the Bank meets at least four (8) times per year or more frequently while HoldCo's Audit Committee at least 4 times or more frequently, as circumstances require, report to the Board on a quarterly basis on its activities, submits the minutes of its meetings to the Board and submits annually an Activity Report of the Audit Committee to the Board. The Audit Committee's meeting is in quorum and meets validly when half of its members plus one are present or represented, provided that at least three (3), including the Chairperson or the Vice Chairperson, are present. Each member of the Committee may validly represent only one of the other Committee members. Representation in the Committee may not be entrusted to persons other than the members thereof. The Audit Committee resolutions are validly taken by an absolute majority of the members who are present and represented. In case of a tie of votes, the Chairperson and in case of his/her absence the Vice Chairperson has the casting vote. The Board is informed whenever a decision of the Audit Committee is not reached unanimously.

During 2020 the attendance details for the Audit Committee were as follows:

Company	Meetings		Average ratio of
				Directors' attendance
	2020	2019	2020	2019
HoldCo	9	12	98%	88%
Bank (from 20.3.2020)	6	n/a	97%	n/a

The Audit Committee appoints its Secretary, who reports to the Group Company Secretariat and cooperates with the Chairperson of the Committee. The Secretary is responsible to minute the proceedings and decisions of all Audit Committees' meetings, including the names of those present and in attendance and the action plans and follow ups for assignments, as well as for the issuance of extracts. Decisions, actions and follow ups are disseminated to the responsible parties, as required.

The Audit Committee's Terms of Reference (ToR) are reviewed every two (2) years and revised if necessary, unless significant changes necessitate earlier revision. The ToR are approved by the Board. The Committee's performance is evaluated annually according to the provisions of HoldCo/Bank Board and Board Committees Evaluation Policy. According to the Committee's 2020 self-evaluation it was determined that the Committee continuous to function effectively, including the areas of leadership, good planning and scheduling of the meetings as well as effective coordination with the Board Risk Committee.

For 2020 the Audit Committee has, amongst others:

Eurobank Holdings Bank

reviewed and discussed reports with information relating mainly to the Internal Audit and Compliance issues,
reviewed the annual Group Compliance Sector's report over AML (per BoG Decision 281/2009) for the year 2019. The report was submitted to the Board and the BoG in March 2020 in line with the regulatory framework. It is noted that later on, in June 2020, Eurobank AC has prepared its own assessment over the annual Group Compliance Sector's report over AML and the annual Group Compliance Sector's report of Eurobank, for further submission to the Board and the BoG, in line with the BoG Governors Act 2577/2006 and Decision 281/2009 requirements,
approved the scope of the independent triennial evaluation of the System of Internal Controls (SIC) per BoG Act 2577/2006,
reviewed and approved the Code of Conduct, the Conflict of Interest Policy, the Market Abuse Policy and the Insider Dealing Guideline,
discussed with Management, Internal Audit and External Auditors issues relating to the financial results,
reviewed and cleared the financial statements and other financial reports and trading updates prior to their release,
discussed with Management the implementation of corrective actions to recommendations made by
reviewed and discussed reports with information relating to the System of Internal Controls, including quarterly reports from Internal Audit Group, Compliance, Operational Risk Sector, Clients Relations Office, etc.,
ensured that an annual evaluation of the System of Internal Controls has been performed, by the Internal Audit Group for the year 2019. Results are documented in the latter's report of the System of Internal Controls. The Audit Committee has prepared its own assessment report on Internal Audit Group's evaluation. The reports were submitted to the Board in May and in June 2020 respectively, and subsequently to the BoG in line with the BoG Act 2577/2006 requirements,
focused particularly on the AML function and received regular updates on the AML issues
reviewed the annual Group Compliance Sector's report over compliance activities of the Bank for the year2019, and prepared its own assessment report thereon. The reports were submitted to the Board and the BoG in June 2020, in line with the BoG Governors Act 2577/2006. It is noted that the AC's assessment report covered also the annual Group Compliance Sector's report over AML which was reviewed by the Eurobank Ergasias AC before the demerger, and was submitted to the Eurobank Ergasias Board and the BoG in March 2020, in line with the Decision 281/2009 requirements,

Internal and External Auditors and Regulatory Authorities,

assessed the effectiveness of the External Auditors, their objectivity and independence, discussed results with Management and Internal Audit and communicated final results to the Board and to the External Auditors,
approved in line with the External Auditor's Independence Policy non-audit services provided in 2020,
approved the annual Plans of Internal Audit Group and of Group Compliance and monitored their progress,
received updates on the progress of the Annual Budget,
in accordance with the provisions of Law 2533/1997, the Audit Committee reviewed reports on substantial stock transactions performed by the HoldCo's Directors and General Managers which meet the criteria set in Law 2533/1997 and notified the Board.
reviewed and approved the Code of Conduct and Ethics, Policy for Reporting Unethical Conduct, Order Execution Policy and Market Abuse Policy,
discussed with Management, Internal Audit and External Auditors issues relating to the interim financial results,
reviewed and cleared the interim consolidated financial statements,
discussed with Management the implementation of corrective actions to recommendations made by Internal and External Auditors and Regulatory Authorities,
discussed with the Audit Committee Chairpersons of Eurobank Cyprus, Eurobank Private Bank Luxembourg and Eurobank Bulgaria the key audit issues of the International Subsidiaries,
assessed the effectiveness of the External Auditors, their objectivity and independence, discussed results with Management and Internal Audit and communicated final results to the Board and to the External Auditors,
assessed the performance of the Head of Internal Audit and the Head of Group Compliance Sector,
approved the remuneration of External Auditors and approved in line with the External Auditor's Independence Policy non-audit services provided in 2020,
approved the annual Plans of Internal Audit Group and of Group Compliance and monitored their progress,
monitored and approved as required, the changes to the memberships of the Audit Committees of the subsidiaries, as required, and reviewed their Activity Reports,
in accordance with the provisions of Law 2533/1997, the Audit Committee reviewed reports on substantial stock transactions performed by the Bank's Directors and General Managers which meet the criteria set in Law 2533/1997 and notified the Board,

4.2 Board Risk Committee3

As mentioned previously, since the demerger of Eurobank Ergasias S.A. on 20.3.2020, Eurobank Holdings' Board Risk Committee, for which there is nor a regulatory requirement neither a business need, it is kept in idle capacity until the BoD will finally conclude on whether to abolish it or not, following the incorporation into the Greek legal framework of the new Directive (EU) 2019/878 (known as CRD V) which is expected to regulate the governance issues of the financial holdings companies (like Eurobank Holdings).

As regards the Bank's Board Risk Committee's (BRC), its purpose is to assist the Board in the following risk-related issues:

to ensure that the Group has a well-defined risk strategy and risk appetite in line with its business plan, and that the risk appetite is articulated in a set of qualitative and quantitative statements and risk tolerance levels for all relevant risks,
to ensure that the Group has developed an appropriate risk management framework which is embedded in the decisionmaking process (e.g. products and services introduction, risk adjusted pricing, internal risk models, risk adjusted performance measures and capital allocation) throughout the Bank and its subsidiaries,
to define the Group risk management principles and ensure that the Bank has the appropriate methodologies, modelling tools, data sources and sufficient and competent staff to identify, assess, monitor and mitigate risks,
to review and assess, at least on a monthly basis, the Bank's and Group's risk profile and effectiveness of its risk management policies and advise the Board accordingly (this review is supported by the Management Risk Committee (MRC) regular reporting, including aspects of operational risk),
to ensure that appropriate stress tests are performed, at least on an annual basis, in relation to all major Group risks,
to review and approve the Bank's internal risk models development (framework, policies, etc.) as well as regularly monitor internal risk models results, including validation and back testing,

³ Information regarding current composition and short biographical details of its members may be found at the HoldCo/Bank websites (www.eurobankholdings.gr & www.eurobank.gr)

to review and approve the Bank's Internal Ratings Based (IRB) rating systems and estimation processes including IRB roll-out plan status and progress report, as well as monitor and report differences between the realized and expected default rates,
to maintain a sound and effective overall architecture for the implementation of the Internal Capital Adequacy Assessment Process (ICAAP) and the Internal Liquidity Adequacy Assessment Process (ILAAP), ensuring that the ICAAP and the ILAAP are integral parts of the Bank's overall management framework,
to provide its assessment of the capital adequacy and liquidity adequacy of the Group,
to assess in compliance with the approved risk appetite and risk tolerance levels, the appropriateness of risk limits, the adequacy of provisions and, in general, the capital adequacy in relation to the risks undertaken by the Group, through, amongst others, the annual report prepared by the Group Risk Management General Division and relevant extract of the report prepared by the Internal Audit Division,
to keep the Board and Audit Committee updated on relevant risk matters and recommend to the Board on an annual basis the future risk strategy and risk appetite,
to provide oversight of, review and approve the Bank's Interest Rate Risk in Banking Book (IRRBB) framework, strategy, policies and processes.

The BRC members are appointed by the BoD, following the recommendation of the Nomination Committee, in accordance with the legal and regulatory framework where applicable. The Chairperson, qualifies as independent member with a solid experience in commercial banking and preferably risk and/or Non-Performing Exposures management and is familiar with the Greek and international regulatory framework. The appointment of the Chairperson and the Vice-Chairperson shall go through the Nomination Committee's proposal process and approved by the Board. The tenure of the BRC members coincides with the tenure of the Bank's Board, with the option to renew their appointment, but in any case the service in the BRC should not be more that twelve (12) years in total. The current BRC consists of six (6) non-executive Directors, four (4) of whom are independent, including the Chairperson. One (1) of the BRC members is the HFSF Representative. The HFSF appointed an Observer in the BRC, in line with the requirements of the TRFA.

The BRC meets at least on a monthly basis and) the Chairperson updates the BoD members on the material matters covered by the Committee during the previous period (if any) at the quarterly meetings of the BoD. Quorum requires the majority of members (half plus one) to be present or represented, provided that no less than three (3) Committee members, including the Chairperson or the Vice Chairperson, are present. Each member of the Committee may validly represent only one of the other Committee members. Representation in the Committee may not be entrusted to persons other than the members thereof. In determining the number of members for the quorum, fractions, if any, will not be counted. The BRC resolutions require a majority vote of the members who are present or represented. In case of a tie, the Chairperson and in case of his/her absence the Vice Chairperson has the casting vote. In case of non-unanimous decisions, the views of the minority are also minuted. The Board is informed of the BRC's minutes. Apart from the BRC members, the Audit Committee's members may also attend BRC sessions when common issues are discussed (i.e. on operational risk matters, on IT security and cyber risks). The Chairperson of the BRC may also invite to the meetings other executives of the Group or external advisors or experts, as deemed appropriate. During 2020 and since the establishment of Eurobank in March 2020, the BRC held twelve (12) meetings with 98% attendance.

The BRC appoints its Secretary, who reports to the Group Company Secretariat and cooperates with the Chairperson of the Committee and the Group Chief Risk Officer ("GCRO"). The Secretary is responsible to minute the proceedings and resolutions of all BRC meetings, including the names of those present and in attendance and the action plans and follow ups for assignments, as well as for issuance of extracts. Decisions, actions and follow ups are disseminated to the Bank's responsible Units, as required.

BRC's Terms of Reference (ToR) were approved by the Board in March 2020, when Eurobank was established, and will be reviewed at least every two (2) years and revised if necessary, unless significant changes in the role, responsibilities, organization and/or regulatory requirements necessitate earlier revision. The Committee's performance is evaluated annually according to the provisions of the Board and Board Committees Evaluation Policy of the Bank. According to the Committee's self-evaluation, it was determined that it continues to function effectively, including the areas of leadership and effective coordination with the Audit Committee.

For 2020, the BRC has, amongst others:

monitored qualitative and quantitative aspects of credit, market, liquidity and operational risks,
updated the Board on the adequacy of the risk management policy and risk appetite framework,
recognized material risks, including the aforementioned risks,
monitored the progress of regulatory projects such as the New Definition of Default project, the Retail new origination application scorecards project, etc.
approved, among others, the following regulatory and other reports, including risk policies and frameworks
- SRB working priorities for the Bank in 2020 (Bail in playbook, etc.)
- Resolution Planning working priorities: Minimum Requirement for Own Funds and Eligible Liabilities (MREL) issuance plan, targets and Resolution planning priorities
- MREL Issuance plan & Targets
- Non-performing Exposures (NPE) Reduction Plan 2020-2023: Summary report, impairments and key risk metrics
- Internal Capital & Liquidity Adequacy Assessment processes (ICAAP/ILAAP) 2020:
  - Macroeconomic, liquidity and operational risk scenarios,
Capital Adequacy Statements, Liquidity Adequacy Statements
Group Risk and Capital Strategy and Risk Appetite Framework as well as Risk Appetite Statements
2020 Group Recovery Plan
Group CRO's Annual Risk report for 2019
Effect of Covid 19 sensitivity analysis on corporate loan portfolios, Covid 19 related bank's policies/ relief measures for Retail and Corporate borrowers, and Covid 19 post moratoria credit Strategy

4.3 Remuneration Committee4

As mentioned previously, since the demerger of Eurobank Ergasias S.A. on 20.3.2020, Eurobank Holdings' Remuneration Committee, for which there is nor a regulatory requirement neither a business need, it is kept in idle capacity until the BoD will finally conclude on whether to abolish it or not, following the incorporation into the Greek legal framework of the new Directive (EU) 2019/878 (known as CRD V) which is expected to regulate the governance issues of the financial holdings companies (like Eurobank Holdings).

As regards the Bank's remuneration Committee, the Board has delegated to it the responsibilities (a) to provide specialized and independent advice for matters relating to remuneration policy and its implementation at Bank and Group level and for the incentives created while managing risks, capital and liquidity, (b) to safeguard the proper exercise of its duties and responsibilities, the efficient alignment of the personnel's remuneration with the risks the Bank undertakes and manages and the required alignment between the Bank and the Group, and (c) to approve or propose for approval all exposures of Key Management Personnel⁵ and their relatives (spouses, children, siblings). The Non-Executive Directors have the responsibility to approve and periodically review Bank's remuneration policy and oversee its implementation both at Bank and Group level.

The implementation of the remuneration policy is in line with the provisions of Laws 3864/2010, 4261/2014 and Bank of Greece Governor's Act 2650/2012.

The RemCo members are appointed by the Board. The tenure of the RemCo members coincides with the tenure of the Bank's Board, with the option to renew their appointment, but in any case the service in RemCo should not be more than twelve (12) years in total. The current RemCo consists of five (5) non- executive Directors three (3) of whom are independent Directors, including the Chairperson. One (1) of the RemCo members is the HFSF Representative. The HFSF appointed an Observer in the RemCo, in line with the requirements of the TRFA.

RemCo meets at least twice a year and minutes are kept. RemCo is in quorum and meets validly when half of its members plus one (1) are present or represented (fractions, if any, are not counted), provided that no less than three (3) members, including the Chairperson or the Vice Chairperson are present. Each member of RemCo may validly represent only one of the other RemCo members. Representation in RemCo may not be entrusted to persons other than the members thereof. RemCo's resolutions are validly taken by an absolute majority of the members who are present or represented. In case of a tie, the Chairperson and in case of his/her absence the Vice Chairperson of RemCo shall have the casting vote. In case of non-unanimous decisions, the views of the minority should also be minuted. The Board shall be informed whenever a decision of the Committee is not reached unanimously. During 2020 and since the establishment of Eurobank in March 2020, RemCo held seven (7) meetings and the ratio of attendance was 100%.

RemCo appoints its Secretary, who reports to the Group Company Secretariat and cooperates with the Chairperson of RemCo and the Group Human Resources Deputy General Manager. The Secretary is responsible to minute the proceedings and resolutions of all RemCo's meetings, including the names of those present and in attendance and the action plans and follow ups for assignments, as well as for issuance of extracts. Decisions, actions and follow ups are disseminated to the Bank's responsible Units, as required.

RemCo's Terms of Reference (ToR) were approved by the Board in March 2020, when Eurobank was established, and will be reviewed at least once every two (2) years and revised if necessary, unless significant changes in the role, responsibilities, organization and/or regulatory requirements necessitate earlier revision. RemCo's performance is evaluated annually according to the provisions of the Board and Board Committees Evaluation Policy of the Bank. According to RemCo's self-evaluation, it was determined that RemCo continues to function effectively, including the area of leadership, while remuneration under the strict legal framework and the ability to retain talent are areas of focus for the RemCo in discharging its responsibilities.

For 2020 and since the establishment of Eurobank in March 2020, RemCo has amongst others:

reviewed and proposed to the Non-Executive Directors for approval the Remuneration Policy of the Bank
discussed the remuneration policy implementation at Group level,

⁴ Information regarding current composition and short biographical details of its members may be found at the HoldCo/Bank websites (www.eurobankholdings.gr & www.eurobank.gr)

⁵ Key Management Personnel includes: Bank's Executive and Non-Executive BoD members, Executive Board (ExBo) members, General Managers non-members of the ExBo and the Heads of Group Internal Audit, Group Compliance, Group Risk Management.

approved the Benefits Policy of the Bank and proposed to the Non-Executive Directors of the Bank for approval the Separation Policy,
proposed to the Board for approval the Board and Board Committees' Fees 2020 for Non-Executive Directors of the Bank,
proposed to the Non-Executive Directors for approval the Bank's total remuneration framework
approved the remuneration frameworks of the Bank's Subsidiaries in Greece
proposed to the BoD for approval the Group Subsidiary Board Remuneration Policy
proposed to the Non-Executive Directors of the Bank for approval the CEO's Performance Evaluation & CEO's Financial and Non-Financial objectives for 2020,
reviewed the implementation of the Board and Board Committees' attendance policy,
approved the Remuneration Disclosures,
Discussed the establishment of a stock options plan
Proposed to the Non-Executive Directors for approval the Voluntary Exit Scheme (VES) and received updates on its implementation

4.4 Nomination Committee6

Eurobank Holdings and the Bank's Boards have delegated to the Nomination Committees (NomCo) the responsibilities (a) to lead the process for Board and Board Committees appointments, including the identification, nomination and recommendation of candidates for appointment to the Board and (b) to consider matters related to the Board's adequacy, efficiency and effectiveness. NomCo, in carrying out its duties, is accountable to the Board.

NomCo members are appointed by the Board. The tenure of NomCo members coincides with the tenure of the Board, with the option to renew their appointment, but in any case the service in NomCo should not be more that twelve (12) years in total. The current NomCo consists of six (6) non-executive Directors, three (3) of whom are independent Directors, including the Chairperson. The BoD Chairman is also a member of NomCo, while one (1) of the NomCo members is the HFSF Representative. The HFSF appointed an Observer in the NomCo, in line with the requirements of the TRFA.

NomCo meets at least twice a year and minutes are kept. NomCo is in quorum and meets validly when half of its members plus one (1) are present or represented (fractions, if any, are not counted), provided that no less than three (3) members, including the Chairperson or the Vice Chairperson are present. Each member of NomCo may validly represent only one of the other NomCo members. Representation in the NomCo may not be entrusted to persons other than the members thereof. NomCo's resolutions are validly taken by an absolute majority of the members who are present or represented. In case of a tie, the Chairperson and in case of his/her absence the Vice Chairperson of NomCo shall have the casting vote. In case of non-unanimous decisions, the views of the minority should also be minuted. The Board shall be informed whenever a decision of the Committee is not reached unanimously.

During 2020 the attendance details for the Nomination Committee were as follows:

Company	Meetings		Average ratio of
				Directors' attendance
	2020	2019	2020	2019
HoldCo	9	88	98%	93%
Bank (from 20.3.2020)	8	n/a	100%	n/a

NomCo appoints its Secretary, who reports to the Group Company Secretariat and cooperates with the Chairperson of NomCo. The Secretary is responsible to minute the proceedings and resolutions of all NomCo's meetings, including the names of those present and in attendance and the action plans and follow ups for assignments, as well as for issuance of extracts. Decisions, actions and follow ups are disseminated to the responsible parties, as required.

NomCo's Terms of Reference (ToR) are reviewed at least once every two (2) years (last review performed inMarch 2020, to incorporate the necessary adjustments following the Demerger of Eurobank Ergasias) and revised if necessary, unless significant changes in the role, responsibilities, organization and/or regulatory requirements necessitate earlier revision. The ToR are approved by the Board while NomCo's performance is evaluated annually according to the provisions of the Board and Board Committees Evaluation Policy. According to NomCo's self-evaluation, it was determined that NomCo continues to function effectively.

For 2020, NomCo has amongst others:

Eurobank Holdings Bank

proposed to the BoD for approval the BoD and BoD Committees 2019 self-evaluation,

proposed to the Board for approval the appointment of new Board members,
approved the new Board members nomination process,

⁶ Information regarding current composition and short biographical details of its members may be found at the HoldCo/Bank websites (www.eurobankholdings.gr & www.eurobank.gr)

proposed to the Board for approval the appointment of new Board members,
reviewed and proposed to the Board for approval the Board Diversity Policy,
approved the new Board members nomination process,
approved the appointment of NomCo Secretary,
reviewed the independence of the Independent Non-Executive directors,
reviewed the attendance of Directors to the Board and its Committees.
approved the selection of candidates as members of the Board of Directors of various subsidiaries,
reviewed and proposed to the BoD for approval the establishment of the Board Digital and Transformation Committee,
reviewed and updated the Board on Senior Executives succession plan,
approved the appointment of General Managers,
approved the appointment of NomCo Secretary,
reviewed the independence of the Independent Non-Executive directors,
reviewed the attendance of Directors to the Board and its Committees.

Board of Directors Diversity Policy

The Board of Directors Diversity Policy ("Policy") sets out the approach to diversity on the Board and it is in accordance with international best practices and the applicable legal framework7.

As declared in the Policy, the Board's diversity is one of the factors which, according to the Board Nomination Policy, the Committee shall consider when examining composition and structure of the Board. A diverse Board includes and makes good use of variety in the skills, educational and professional background, geographical provenance (nationality), gender, age and other qualities of Directors.

NomCo members discuss and agree all measurable objectives for achieving diversity on the Board during the review process of the Board profile matrix according to the Board Nomination Policy and for proposing the (re)appointment/succession planning of individual Board members according to the Board and Board Committees Evaluation Policy, taking into consideration the balance of all diversity aspects mentioned in the Policy. At any given time the Board may seek to improve one or more aspects of its diversity and measure progress accordingly.

According to the Policy, NomCo's priority is to ensure that the Board continues to have strong leadership and the right mix of skills to deliver the business strategy. Within this context and in regard to the less represented gender in the Board, NomCo's aim is that the percentage of the female gender representation in HoldCo's Board shall be at least 20% calculated on the total Board size, with a minimum of two (2) female members, also considering industry trends and best practices. As of 31 December 2020, following the appointments of Ms. Alice Gregoriadi and Ms. Irene Rouvitha-Panou to the BoD of HoldCo/Bank in April 2020, along with the appointment of Ms. Cinzia Basile to the BoD of HoldCo/Bank in December 2020, the representation of the female gender in the HoldCo/Bank Board stood at 23%. The representation rate of the female gender in the HoldCo/Bank Board, increased to 31% on 28 January 2021, following the appointment of Ms. Efthymia Deli at the HoldCo/Bank BoD.

Assessment of the knowledge, skills and experience (KSE) of the Board collectively as well as the KSE and contribution of individual Board members

In accordance with the respective legal framework and the Board and Board Committees Evaluation Policy, the Board Chair conducted an assessment of the contribution of the Non-Executive Board Members for 2020 and presented the results to NomCo.

Specific focus areas were applied as follows:

contribution to overall Board profile skillset,
Board participation and quality of contributions to Board deliberations,
punctuality and attendance,
team spirit and demeanour,
independent thinking and constructive challenge.

The overall assessment demonstrated quite positive results across all focus areas and has confirmed that the assessed Non-Executive Board Members adequately meet expectations for effectively accomplishing their role as Directors of the HoldCo/Bank.

Furthermore, the HoldCo/Bank 2020 Target Board profile matrix has revealed that the desired KSEs are overall met for all the Board members. The Target Board profile matrix is the instrument to identify the specific characteristics the Board needs on the basis of its strategic objectives and risk management priorities, purposed to track the current profile of the Board against the desirable KSEs, through the assessment of the existing KSEs of all Board members (Executives and Non-Executives Directors).

Board Nomination Policy

7 The Board of Directors Diversity Policy may be found at the HoldCo/Bank's website The Board Nomination Policy sets out the guidelines and formal process for the identification, selection and nomination of candidates for the Board. The Policy ensures that such appointments are made: (a) in accordance with legal and regulatory requirements; (b) with due regard to the expectations of the major shareholders, (c) in line with the HoldCo's and Bank's contractual obligations with the HFSF and (d) on the basis of individual merit and ability, following a best practice process.

The Board supported by NomCo shall nominate candidates who meet the following nomination criteria:

Reputation along with honesty, integrity and trust

a) Reputation: Sufficiently good repute, high social esteem and adherence to the reputation, honesty, and integrity criteria of the applicable regulatory framework
b) Honesty, integrity and trust: Demonstration of the highest standards of ethics, honesty, integrity, fairness, and personal discipline, through personal history, professional track record or other public commitments
Knowledge, skills, experience (KSE) and other general suitability requirements
- a) Understanding of the HoldCo/Bank: Sufficient KSE for the development of a proper understanding of the business, culture, supervisory and regulatory context, product and geographic markets of operations, and stakeholders of the HoldCo and its subsidiaries
- b) Seniority: Several years of experience in a generally recognised position of leadership in the candidate's field of endeavour
- c) Independent mind-set and ability to challenge: Ability of forming and expressing an independent judgement on all matters that reach the Board and candour to challenge proposals and views on these matters by management and other candidates
- d) Collegiality, team skills and leadership: Ability to contribute constructively and productively to Board discussions and decision making along with ability of leading such discussions as chair or vice-chair of specific committees or the Board as a whole
- e) Additional criteria for the nomination of Executive Directors: Proven, through current and previous executive positions, knowledge, skills, experience and character to lead the HoldCo/Bank and its subsidiaries in the achievement of strategic objectives, along with willingness to enter into full time employment with the HoldCo/Bank.
Conflicts of interest and independence of mind

NomCo examines the personal, professional, financial, political and any other possible interests and affiliations of candidates, ensuring that the candidates do not have actual, potential or perceived conflicts of interest which cannot be prevented, adequately mitigated or managed under the written policies of the HoldCo/Bank, that would impair their ability to represent the interests of all shareholders of the HoldCo/Bank, fulfil their responsibilities as Directors and make sound, objective and independent decisions (act with independence of mind).

In particular, NomCo shall ensure that candidates are not linked to borrowers with an exposure above EUR 1 million or any exposures in arrears. NomCo shall also examine relevant direct and indirect monetary interests and non-monetary interests, including those arising from affiliations with and membership in other organisations.

Time commitment

NomCo ensures that all nominees are able to commit the time necessary to effectively discharge their responsibilities as Directors, including regularly attending and participating in meetings of the Board and its Committees.

Collective suitability

The Target Board Profile Matrix is updated in accordance with the strategic objectives and risk management priorities of the HoldCo/Bank, assisting in identifying the desirable KSE of the members to ensure collective suitability.

The Board Nomination Policy is approved by the Board and reviewed at least once every two (2) years by NomCo and revised if necessary, unless material changes, regulatory or other, necessitate earlier revision.

4.5 Strategic Planning Committee8

As mentioned previously, since the demerger of Eurobank Ergasias S.A. on 20.3.2020, Eurobank Holdings' Strategic Planning Committee, for which there is nor a regulatory requirement neither a business need, it is kept in idle capacity until the BoD will finally conclude on whether to abolish it or not, following the incorporation into the Greek legal framework of the new Directive (EU) 2019/878 (known as CRD V) which is expected to regulate the governance issues of the financial holdings companies (like Eurobank Holdings).

As regards the Bank, its Strategic Planning Committee (SPC) is established by the Board and its purpose is to:

a) assist the Board's Executive Officers in planning, developing and implementing the Group's Strategy and
b) recommend to the Board certain initiatives in relation to the Group's Strategy.

The key tasks and responsibilities of the SPC are:

⁸ Information regarding current composition and short biographical details of its members may be found at the HoldCo/Bank website.

to ensure that the Group develops a well-defined planned medium term strategy in line with the Board's guidance and its approved business plan,
to review, within the framework of which the Executive Board draws up the annual budget and the business plan, the key objectives and goals contained therein and review major business initiatives, before their submission for approval to the Board.
to review, analyze and deliberate issues concerning the Group's strategic choices (e.g. strategic partnerships, share capital increase, issuing convertibles and/or launching debt issuance programs, mergers, acquisitions or disposals, the formation of joint ventures, creation or dissolution of special purpose vehicles, dividend distribution and all other major investments or disinvestments by the Group etc.), ensuring these being in line with the approved Group's strategy. The SPC shall formulate relevant proposals to the Board, if:
- a) the issue under discussion exceeds € 40 million, while for lower amounts approval will be provided by the Executive Board;
- b) a decision of the Board is obligatory by Law or by the Bank's contractual commitments;
- c) it is deemed necessary by the SPC, taking into account the complexity and nature of the strategic choices under discussion.
to submit to the Board for approval proposals relating to the strategy and the budget of the Property Portfolio as described in the Service Level Agreement between Eurobank and Grivalia Management Company.
to submit to the Board for approval proposals for the acquisition and disposal of assets other than repossessed assets (as these are defined in the Service Level Agreement between Eurobank and Grivalia Management Company) with book value above € 10 million.
to submit to the Board for approval proposals for the disposal of repossessed assets (as these are defined in the Service Level Agreement between Eurobank and Grivalia Management Company) with gross book value above € 20 million.
to maintain and take all necessary actions on regulatory and internal capital required to cover all types of risks (incl. strategic and reputational risks, as well as other non-quantifiable risks) and to ensure that capital requirements are met at all times,
to review and evaluate all major Group's initiatives aiming at transforming the business and operating model,
to monitor on a regular basis the strategic and the key performance indicators of the Group, including the segmental view,
to review and, as needed, make proposals to the Board on all other issues of strategic importance to the Group.

The SPC members are appointed by the Board, on the recommendation of its Chairperson, following the proposal by the Nomination Committee.

The Committee is chaired by the Chairperson of the Board and in case of absence or impediment of the Chairperson by the Vice-Chairperson of the Board and is composed of the following members with voting rights:

The Chairperson of the Board
The Vice-Chairperson of the Board
The Chief Executive Officer (CEO)
The Deputy CEOs
The Group Chief Risk Officer
The Group Chief Financial Officer

The General Manager Group Strategy participates in the Committee as a permanent attendee with no voting rights.

The Committee may delegate specific responsibilities and authorities within the purview of its responsibilities and authorities to one (1) or more individual Committee members.

The SPC meets biweekly or ad hoc when necessary, keeps minutes of its meetings and reports to the Board on a quarterly basis and as required. During 2020 and since the establishment of Eurobank in March 2020, the SPC held thirty-seven (37) meetings and the ratio of attendance was 99%. The Committee is in quorum and meets validly when half of its members plus one, including the Chairperson or the Vice-Chairperson and the CEO, are present. Resolutions of the Committee are reached unanimously by the members who are present.

The SPC appoints its Secretary, who reports to the Group Company Secretariat and cooperates with the Chairperson of the Committee. The Secretary is responsible to minute the proceedings and resolutions of all SPC meetings, including the names of those present and in attendance and the action plans and follow up assignments, as well as for issuance of extracts. Decisions, actions and follow ups are disseminated to the Bank's responsible Units, as required. The minutes of the SPC are submitted to the Board on a quarterly basis.

The Terms of Reference (ToR) of the Committee were approved by the Board in March 2020, when Eurobank was established, and will be reviewed once every three (3) years and revised if necessary, unless significant changes in the role, responsibilities, organization and / or regulatory requirements necessitate earlier revision. The Committee evaluates its performance at least annually and establishes criteria for such evaluation. The results are submitted to the Nomination Committee, so that the latter makes proposals to the Board, as required.

4.6 Board Digital & Transformation Committee9

On 15 September 2020, following the recommendation of the Bank's NomCo, the Bank's Board established the Board Digital & Transformation Committee (BDTC). The BDTC is a consultative body that makes proposals to the BoD on the Group's digital, innovation, transformation and cybersecurity matters in order to contribute in achieving the vision and strategic goals of the Bank. The BDTC, in carrying out its duties, is accountable to the Board.

The BDTC members are appointed by the Board. The tenure of the BDTC members coincides with the tenure of the Bank's Board, with the option to renew their appointment, but in any case the service in BDTC should not be more than twelve (12) years in total. The current BDTC consists of six (6) Directors of whom two (2) executives, three (3) independent nonexecutives, one (1) non-executive who is also the representative of the HFSF. The HFSF appointed an Observer in the BDTC, in line with the requirements of the TRFA.

BDTC meets at least twice a year and as each time required, also considering that the annually held Strategy Away Day is a forum in which relevant digital and transformation strategic matters are also discussed, while minutes are kept for all meetings. BDTC is in quorum and meets validly when half of its members plus one (1) are present or represented (fractions, if any, are not counted), provided that no less than three (3) members, including the Chairperson or the Vice Chairperson and one non‐executive director are present. At all times, the Chairperson or the Vice Chairperson are present and the total number of non‐executive (incl. independent nonexecutive) directors should be the majority of the members present or represented. Each member may validly represent only one of the other BDTC members and representation may not be entrusted to persons other than the Committee members. BDTC's resolutions are validly taken by an absolute majority of the members who are present or represented. In case of a tie, the Chairperson and in case of his/her absence the Vice Chairperson of BDTC shall have the casting vote. In case of non-unanimous decisions, the views of the minority should also be minuted. The Board shall be informed whenever a decision of the BDTC is not reached unanimously. During 2020 and since the establishment of BDTC, BDTC held two (2) meetings and the ratio of attendance was 100%.

BDTC appoints its Secretary, who reports to the Group Company Secretariat and cooperates with the Chairperson of BDTC. The Secretary is responsible to minute the proceedings and resolutions of all BDTC's meetings, including the names of those present and in attendance and the action plans and follow ups for assignments, as well as for issuance of extracts. Decisions, actions and follow ups are disseminated to the Bank's responsible Units, as required.

The BDTC Terms of Reference (ToR) were approved by the BoD on 15 September 2020, when the BDTC was established, and will be reviewed at least once every two (2) years and revised if necessary, unless significant changes in the role, responsibilities, organization and/or regulatory requirements necessitate earlier revision. BDTC's performance will be evaluated for the first time in 2021.

For 2020 and since its establishment, BDTC has discussed mainly a) the current and desired state of the Bank on digital banking, information technology, cyber security and HR/culture thematic and b) the Strategic aspirations of IT & Digital and the key enablers and prerequisites to achieve them.

5. Management Committees

Given that there is nor a relevant regulatory requirement neither a business need, the CEO has not established committees at HoldCo level.

As regards the Bank, the CEO establishes committees to assist him, as required, in discharging his duties and responsibilities. The most important Committees established by the CEO are the Executive Board, the Management Risk Committee, the Group Asset and Liability Committee, the Central Credit Committees (I & II) and the Troubled Assets Committee.

Executive Board¹⁰

The Executive Board (ExBo) manages the implementation of Group's strategy, as developed by the SPC, in line with the Board's guidance. The functioning of ExBo is subject to the provisions of the TRFA. The ExBo is established by the CEO and its members are appointed by the CEO. The ExBo meets on a weekly basis or ad hoc when necessary. Other executives of the Group, depending on the subject to be discussed, may be invited to attend.

The ExBo is in quorum and meets validly when half of its members plus one are present or represented. In determining the number of members for the quorum, fractions, if any, shall not be counted. The ExBo resolutions require a majority vote. The ExBo appoints its Secretary, who reports to the Group Company Secretariat and cooperates with the Chairperson of the Committee. The Secretary is responsible to minute the proceedings and resolutions of all ExBo meetings, including the names of those present and in attendance and the action plans and follow ups for assignments, as well as for issuance of

⁹ Information regarding current composition and short biographical details of its members may be found at the Bank's website (www.eurobank.gr).

¹⁰ Information regarding current composition and short biographical details of its members may be found at the Bank's website (www.eurobank.gr).

extracts. Decisions, actions and follow ups are disseminated to the Bank's responsible Units, as required. The ExBo Terms of Reference (ToR) are approved by the CEO, and revised as appropriate.

The ExBo's key tasks and responsibilities are to:

manage the implementation of the Group's strategy as developed by the SPC, in line with the BoD's guidance
draw up the annual budget and the business plan. The SPC reviews the key objectives and the goals contained therein, as well as the major business initiatives, and submits them to the Board for approval,
approve issues concerning the Group's strategic choices (e.g. partnerships, share capital increase, issuing convertibles and/or launching debt issuance programs, mergers, acquisitions or disposals, the formation of joint ventures, creation or dissolution of special purpose vehicles, dividend distribution and all other investments or non-material disinvestments¹¹ by the Group etc.), ensuring these being in line with the approved Group's strategy, if the issue under discussion is less than or equal to €40 million. In case though:
- a) the issue under discussion exceeds € 40 million;
- b) a decision of the Board is obligatory by Law or by the Bank's contractual commitments;
- c) it is deemed necessary by the SPC, taking into account the complexity and nature of the strategic choices under discussion;

the issues concerning the Group's strategic choices are approved by the Board following a relevant proposal by the SPC (as per its Terms of Reference),

to perform its duties duties according to the Bank's policies, Service Level Agreements (SLAs) and Reverse Service Level Agreement (RSLAs) as approved by ExBo, BoD Committees and BoD. In particular, following the Amended & Restated SLA of August 2020 between Eurobank and Grivalia Management Company S.A., the Executive Board is responsible:
- o To approve any decision to acquire any single Asset to be classified as a Grivalia Asset with an acquisition price exceeding € 10 million, and up to € 40 million, following a recommendation by the Real Estate Committee (REC). For Assets exceeding € 40 million the decision is approved by the BoD following a recommendation by the SPC, which will have received a recommendation by the REC.
- o To approve any decision to divest any single Asset classified as a Grivalia Asset or included in the Eurobank Greek Portfolio with a book value exceeding € 10 million, and up to € 40 million, following a recommendation by the REC. For any Asset with a book value exceeding € 40 million, the decision is approved by the BoD following a recommendation by the SPC, which will have received a recommendation by the REC.
- o To approve any decision to divest a group of 10 Assets or more "Portfolio Sale" for which the total book value of the Assets exceeds € 5 million and up to € 40 million, following a recommendation by the Real Estate Committee. For a Portfolio Sale for which the total book value of Assets exceeds € 40 million, the decision is approved by the BoD following a recommendation by the SPC, which will have received a recommendation by the REC.
- o To approve any decision to lease an asset of the Grivalia Assets and Eurobank Greek Portfolio other of than the Eurobank REO Portfolio or Eurobank to lease from a third party, for rental contracts with a value exceeding € 300 thousand per month following a recommendation by the Real Estate Committee.
in case that the Real Estate Strategic Committee cannot reach an unanimous decision for a matter, as described by its ToR, such matter shall be referred to the ExBo or the SPC, as required.
monitor the performance of each business unit and country against budget and ensure corrective measures are in place wherever required,
decide on all major Group's initiatives aiming at transforming the business and operating model, enhancing the operating efficiency and cost rationalization, improving organizational and business structure,
ensure that adequate systems of internal controls are properly maintained,
review and approve Bank's Policies (other than Credit Policies that are approved by Management Risk Committee and/or Troubled Assets Committee and/or BRC) that are related to its responsibilities and/or are of critical importance to the Bank, including but not limited to those requiring BoD approval as per the TRFA,
review the performance of any Committee and /or individuals to whom it has delegated part of its responsibilities, as approved,
ensure adequacy of Resolution Planning governance, processes and systems
hire and retain external consulting firms in its sole judgment, and approve their compensation and terms of engagement in accordance with Bank's policies and procedures,
hire and retain investment banking advisors, in its sole judgment, and approve their compensation and terms of engagement, in accordance with Bank's policies and procedures, where applicable.

Management Risk Committee¹²

The Management Risk Committee (MRC) oversees the risk management framework of Eurobank. The MRC ensures that material risks are identified and promptly escalated to the BRC and that the necessary policies and procedures are in place

¹¹ As specified in the Divestment Policy

¹² Information regarding current composition and short biographical details of its members may be found at the Bank's website (www.eurobank.gr).

to prudently manage risk and to comply with regulatory requirements. The MRC members should have the ability to identify, assess and manage the Group's risks.

As part of its mandate, the MRC:

reviews the Bank's and its subsidiaries' risk profile vis-à-vis its declared risk appetite and examines any proposed modifications to the risk appetite,
reviews and approves the methodology, the parameters and the results of the Bank's stress testing programme,
determines appropriate management actions which are discussed and presented to the ExBo for information and submitted to the BRC for approval, and maintains at all times a pro-active approach to Risk Management, understands and evaluates risks, addresses escalated issues, provides oversight to the Group's risk management framework – including the implementation of risk policies – and informs the BRC of the Group's risk profile
assists the BRC in defining risk management principles and methodologies thereby ensuring that the Group's Risk Management Framework contains processes for identifying, measuring, monitoring, mitigating and reporting the current risk profile against its risk appetite, limits, and performance targets.

The MRC does not conflict with the GCRO or the Risk Management General Division's responsibilities for Risk governance as prescribed under the HFSF Relationship Framework Agreement or the Bank of Greece's Governor Act no. 2577/2006. The CEO serves as the Chairperson of the MRC and the GCRO as the Vice Chairman. They have responsibility to escalate material risks and issues to the BRC and to update ExBo on material risks and issues on a periodical basis.

The MRC is in quorum and meets validly when half of its members, including the Chairperson or the Vice-Chairperson, plus one are present or represented. Selected attendees can be invited to the MRC meetings, when the topics for discussion fall under their remit or they have the requisite expertise to constructively participate. The finalized minutes are distributed to the BRC, SPC and ExBo members, as prepared by the committee's secretary and approved by its Chairperson. Abstracts of resolutions reached and actions to be taken are provided to Management, SPC and/or ExBo members, as necessary.

Resolutions of the MRC are decided based on a simple majority and in case of a tie vote, the Chairman or the Vice-Chairman in the case of Chairman's absence, has the casting vote. The opinion of the minority is recorded in the meeting minutes whenever a decision of the MRC is not reached unanimously, and the BRC is informed accordingly.

Changes to the ToR of the MRC are reviewed by the MRC at least every two (2) years and revised if necessary, unless significant changes in the composition, role, responsibilities, organization and / or regulatory requirements necessitate earlier revision and are approved by the CEO. The ToR of MRC are also submitted to the BRC for information purposes.

Group Asset and Liability Committee (G-ALCO)13

G-ALCO's primary mandate is to i) review, approve, formulate, implement and monitor - as may be appropriate - the Group's a) liquidity and funding strategies and policies, b) interest rate guidelines and interest rate risk policies, c) Group's capital investments, as well as FX exposure and hedging strategy, and d) Group's business initiatives and/or investments that affect the Bank's market and liquidity risk profile, ii) approve at a first stage and recommend to the BRC for final approval the respective country limits (with special attention given for the approval / monitoring of the limits for countries where Eurobank has a local presence) and iii) approve or propose –as the case may be - changes to these policies that conform to the Bank's risk appetite and levels of exposure as determined by the BRC & Management while complying with the framework established by regulatory authorities and/or supervising bodies.

G-ALCO convenes once a month and/or whenever required. Other executives or managers of the Group, depending on the subject to be discussed, may be invited to attend as required.

Required quorum for G-ALCO meetings to be effective is six members. In order to have a quorum the presence of its Chairperson and a minimum of three (3) SPC members is required. Decisions on issues are taken by majority and communicated to the relevant / affected business areas, while meetings are minuted by the Committee's Secretary and distributed to G-ALCO members, the CEO, the Board's Chairman and the Single Supervisory Mechanism (SSM).

Central Credit Committees

Central Credit Committee I

The main objective of Central Credit Committee I (CCCI) is to ensure the objective credit underwriting of relevant exposures of Greek corporate performing and private banking clients, in accordance to the Risk Appetite Framework and the Credit Policy Manual of the Bank and in a way that balances credit risk and return on equity.

The CCCI is chaired by an independent to Business and Risk Professional, convenes at least once a week and all meetings are minuted. Decisions are taken unanimously. If unanimity is not achieved, the credit request is escalated by the

¹³ Information regarding current composition and short biographical details of its members may be found at the Bank's website (www.eurobank.gr).

Chairperson to the next (higher) approval level requiring a unanimous decision. In case of non-unanimity the final decision lies with the Management Risk Committee (MRC), by majority voting.

The main duty and responsibility of the CCCI is to assess and approve all credit requests for clients in the Greek related corporate performing and private banking portfolio of a total exposure above €50mio and unsecured exposure above €35mio. For total exposure exceeding €75mio and unsecured exposure exceeding €50mio, additional approval by the GCRO is required, while for total exposure exceeding €150mio and unsecured exposure exceeding €100mio, additional approval by the CEO is required. Furthermore, for exposures higher than 10% of the Bank's regulatory capital the additional approval of the Management Risk Committee (MRC) is required. Subsequently, the consent of Hellenic Financial Stability Fund (HFSF) is necessary, whereas final approval is granted by the Board Risk Committee (BRC).

Central Credit Committee II

The main objective of the Central Credit Committee II (CCCII) is the same as for the CCCI for lower levels of exposure.

The CCCII convenes at least once a week and all meetings are minuted. Decisions are taken unanimously. If unanimity is not achieved, the request is escalated by the Chairperson to the next approval level.

The main duty and responsibility of CCCII is to assess and approve all credit requests for clients in the Greek related corporate performing and private banking portfolio for total exposure from €20mio up to €50mio and unsecured exposure from €10mio up to €35mio and retail exposures for total limits above €3mio.

Troubled Assets Committee14

The Troubled Assets Committee (TAC) is established according to the provisions of the BoG Executive Committee Act No. 42/30.5.2014, as in force. The main purpose of the Troubled Assets Committee is to act as an independent oversight body, closely monitoring the Bank's troubled assets portfolio and the execution of its NPE Management Strategy. The Committee's composition and Terms of Reference (ToR) are approved by the CEO of the Bank.

The Committee meets at least once per month and/or whenever required if the majority of the members, including the Chairperson, are present. Decisions are taken by majority, are minuted and circulated as appropriate. The Chairman has a casting vote. TAC informs the Board or its competent Committees on the results of its activities, at least quarterly. TAC cooperates with Group Risk Management Division in order to develop and to be fully aligned with regard to the appropriate methodologies applied for the evaluation of the risks inherent in every type of modification and delinquency bucket, by portfolio. TAC's reports to the BoD or its competent Committees are also submitted to Group Risk Management General Division.

Main responsibilities of the Committee are, among others, the following:

processes centrally all the internal reports regarding troubled assets management under the provisions of BoG Acts 42/30.05.2014 and its amendments
approves the available forbearance, resolution and closure solutions by loan sub-portfolio, and monitors their performance through suitable KPIs
defines criteria to assess the sustainability of credit and collateral workout solutions (design and use of "decision trees")
determines the parameters and the range of responsibilities of the bodies and officers involved in the assessment of viability and sustainability of the proposed modifications and the subsequent monitoring of their implementation
designs, monitors and assesses pilot modification programs (in cooperation with other business units)
supervises and provides guidance and know-how to the respective troubled assets units of the Bank's subsidiaries abroad.

6. Key Control Functions

As part of its overall system of internal controls, HoldCo has established a number of dedicated control functions whose main responsibility is to act as independent control mechanisms thus reinforcing the control structure of the HoldCo. The most important functions and their key responsibilities are described below.

6.1 Internal Audit

Eurobank Holdings

Internal Audit ("IA") is an independent, objective assurance and consulting function designed to add value and improve the operations of Eurobank Holdings. IA has adequate organisation structure and appropriate resources to ensure that it can fulfil its roles and responsibilities.

¹⁴ Information regarding current composition and short biographical details of its members may be found at the Bank's website (www.eurobank.gr).

IA also maintains a quality assurance and improvement programme, which covers all aspects of the IA, to ensure the consistent application of the methodology in accordance with the IIA Standards.

In order to safeguard its independence, IA reports functionally to the Audit Committee and administratively to the CEO. The Board has delegated the responsibility for monitoring the activity of the IA to the Audit Committee of the HoldCo. IA is headed by the Chief Internal Auditor (CIA) who is appointed by the Audit Committee. The latter also assesses the CIA's performance.

The mission of IA is to enhance and protect organisational value by providing risk-based and objective assurance, advice and insight. The key assurance and consulting responsibilities of IA are to:

provide reasonable assurance, in the form of an independent opinion, as to the adequacy and effectiveness of the internal control framework of the HoldCo. IA has a periodic plan and budget approved by the Audit Committee. IA ensures establishment of risk based audit plan and priorities in consistency with the HoldCo's strategic plan and adherence to regulatory requirements,
assist Management on the prevention and detection of fraud or defalcation (unethical practices etc.),
assist Management in enhancing the system of internal control by making recommendations to address weaknesses and improve existing policies and procedures,
follow-up to ascertain that appropriate action is taken on reported audit findings within agreed deadlines,
participate in HoldCo's projects in an assurance or consulting capacity.

Eurobank

Internal Audit Group ("IAG") is an independent, objective assurance and consulting function designed to add value and improve the operations of Eurobank and its subsidiaries. IAG has adequate organisation structure and appropriate resources to ensure that it can fulfil its roles and responsibilities.

IAG comprises the "Internal Audit Sector", the "Forensic Audit Division", the "International Audit Division" and the "Business Monitoring and Organisational Support Division". IAG also has a Quality Assurance function (QAF), to assess the effectiveness of the Group's internal audit activities and conformance with IIA Standards. QAF operates as Centre of Excellence for Audit Standards & Methodology, acting as an advisor to IAG Management in topics related to quality improvement and methodology.

In order to safeguard its independence, IAG reports functionally to the Audit Committee and administratively to the CEO. The Board has delegated the responsibility for monitoring the activity of the IAG to the Audit Committee of the Bank. IAG is headed by the Group Chief Audit Executive (CAE) who is appointed by the Audit Committee. The latter also assesses the CAE's performance.

The key assurance and consulting responsibilities of IAG are to:

provide reasonable assurance, in the form of an independent opinion, as to the adequacy and effectiveness of the internal control framework of the Bank and its subsidiaries. In order to form an opinion, IAG establishes and carries out a programme of audit work (based on the risk assessment of the audit universe),
assist and advise Management on the prevention and detection of fraud or defalcation or unethical practices and undertake such special projects as required,
assist Management in enhancing the system of internal control by making recommendations to address weaknesses and improve existing policies and procedures,
follow-up to ascertain that appropriate action is taken on reported audit findings within agreed deadlines,
carry out any other specific duties required by the Regulatory Authorities and/or participate in bank wide projects undertaken by the Bank,
participate in Bank projects in an assurance or consulting capacity
assess the performance of the Group's internal audit functions, which have a direct reporting line to IAG.

6.2 Risk Management

Eurobank Holdings

As part of its overall system of internal controls HoldCo has engaged in a Service Level Agreement (SLA) with Eurobank in order to receive supporting and advisory services in all areas of risk management (credit, market, liquidity and operational risks) undertaken by the Group. The most important services provided through the above mentioned SLA are described below:

Provision of advice on:
- Identification, evaluation and monitoring of credit risk
- Ensuring policy and instructions (strategy and products) recommended by business owners and Servicers are aligned to applicable credit policy manual and regulatory guidelines
- Standardization of procedures and guidelines
- Update and maintenance of the risk strategic framework master document
- Participation in systemic bank consultation committees Review new remedial products and initiatives prior submission to TAG or approval
Coordination of NPE related regulatory reporting
Provision of input for SSM submission and 3-year business plan, monthly MIS actual data (including Greek and International subsidiaries)
Advising on identification, support/advise, recording and evaluation of liquidity risks and financial monitoring
Advising in the identification, assessment, recording and monitoring of operational risks (e.g. RCSA, events capture, outsourcing etc.)

Eurobank

The Group Risk Management General Division, which is headed by the Group Chief Risk Officer (GCRO), is independent from the business units and has full responsibility for monitoring credit, market, liquidity and operational risks undertaken by the Eurobank Group.

It comprises the Group Credit General Division, the Group Credit Control Sector, the Group Credit Risk Capital Adequacy Control Sector, the Group Market & Counterparty Risk Sector, the Group Operational Risk Sector, the Group Model Validation & Governance Sector, the Group Risk Management Strategy Planning & Operations, the Risk Analytics Division and the Supervisory Relations & Resolution Planning Sector15.

The GCRO serves as a pivotal point for the risk management functions of the Group and he is responsible for developing the Risk Appetite Framework and overseeing and coordinating the development and implementation of adequate risk measurement and management policies in relation to credit, market, liquidity, and operational risks.

The GCRO reviews the credit policies prepared by the responsible Risk Units before their submission for final approval to the BRC or to the BoD and oversees their implementation thereafter. The GCRO promptly reports any deviation from the credit policy or potential conflict with the approved risk strategy and risk appetite to the Board Risk Committee.

The GCRO is responsible to provide to the Board Risk Committee, on a monthly basis, adequate information so that the Committee can properly oversee and advise the BoD on the Bank's risk exposures / profile and future risk strategy. Additionally, the GCRO oversees compliance with approved Risk Appetite Limits, included in the Risk Appetite Framework (RAF) and reports compliance status as well as any deviations to the Board Risk Committee.

Eurobank has a well-established strategy and clear risk management objectives that has to deliver through core risk management processes and methodologies. At a strategic level, the risk management objectives are to:

Identify Eurobank's material risks (credit, market/liquidity, operational);
Ensure that business plan is consistent with Eurobank's risk appetite;
Optimize risk/return decisions by taking them as closely as possible to the business, while establishing strong and independent review;
Ensure that business growth plans are properly supported by effective risk infrastructure;
Manage risk profile to ensure that specific financial deliverables remain possible under a range of adverse business conditions;
Assist senior executives improve the control and co-ordination of risk taking across their businesses;
Embed risk management into the Bank's culture and existing processes and raise awareness of risk management throughout the Bank;
Provide the framework, procedures and guidance to enable all employees to manage risk in their own areas across the Business and back-office Units.
Advise and support Eurobank Holdings in risk management according to the agreed Service Level Agreement (SLA) between Eurobank Holdings and Eurobank.

6.3 Compliance

Eurobank Holdings

Eurobank Holdings Compliance is established with the approval of the Board of Directors and the Audit Committee. It is a permanent function and independent from Eurobank Holdings' business activities so that conflicts of interests are avoided. In order to safeguard its independence, it reports functionally to the Audit Committee and for administrative purposes to the CEO.

Its mission is to promote, within Eurobank Holdings, an organizational culture that encourages ethical conduct, and a commitment to compliance with laws and regulations as well as international governance standards.

The main objective of Eurobank Holdings Compliance is to ensure that Eurobank Holdings has established an adequate system of internal controls that allows it to operate in accordance with the ethical set of values contained in its corporate governance framework and in compliance with applicable laws, regulations and internal policies. More specifically, Eurobank Holdings Compliance is mandated to:

¹⁵ The Supervisory Relations & Resolution Planning Sector has a dual reporting line to both the GCRO & the Group Chief Financial Officer

advice the Board of Directors and Senior Management on Eurobank Holdings compliance with applicable laws, rules and standards and keeping them informed of developments in the area
issue, as necessary, policies and other documents such as internal codes of conduct, in order to provide guidance to staff on the appropriate implementation of applicable laws, rules and standards
assist the business to develop and implement regulatory compliant policies and procedures
review new high-risk activities and advise on potential compliance risks
ensure that staff is adequately trained about compliance issues. Provide guidance on the application of regulations in practice
support and challenge, if required, business line management regarding the completeness and accuracy of the compliance risk management activities
monitor whether staff effectively applies the internal processes and procedures aimed at achieving regulatory compliance
monitor staff adherence to internal policies and the "Code of Conduct and Ethics" and/or indications of fraudulent activity
monitor timely submission of reports and report any delays and fines to the AC
fulfil any statutory responsibilities and liaise with regulators and external bodies.

Eurobank

Group Compliance is established with the approval of the Board of Directors and the Audit Committee . It is a permanent function and independent from the Bank's business activities so that conflicts of interests are avoided. In order to safeguard its independence, it reports functionally to the Audit Committee of the Bank and for administrative purposes to the CEO.

Its mission is to promote, within the Bank and its subsidiaries, an organizational culture that encourages ethical conduct through integrity, and a commitment to compliance with laws and regulations as well as the application of international governance standards.

The main objective of Group Compliance is to ensure that the Group has established an adequate system of internal controls that allows it to operate in accordance with the ethical set of values contained in its "Code of Conduct and Ethics" and in compliance with applicable laws, regulations and internal policies, as well as international best practices. More specifically, Group Compliance is mandated to:

advice the Board of Directors and Senior Management on the Bank's compliance with applicable laws, rules and standards and keeping them informed of developments in the area
issue policies, procedures and other documents in order to provide guidance to staff on the appropriate implementation of applicable laws, rules and standards
assist the business to develop and implement regulatory compliant policies and procedures, exercising an enforcement/decision making authority as the most appropriate body and expert on these issues
review new high-risk activities and advise on potential compliance risks
ensure that staff is adequately trained and frequently updated about compliance issues by designing training programs and co-operating with HR for their implementation. Provide guidance on the application of regulations in practice
develop a robust compliance risk identification and assessment framework. Support and challenge, if required, business line management regarding the completeness and accuracy of the compliance risk management activities
monitor and test whether staff effectively applies the internal processes and procedures aimed at achieving regulatory compliance. Report on potential breaches and required improvements and follow up on implementation
review staff accounts in order to monitor staff adherence to internal policies and the "Code of Conduct and Ethics" or indications of fraudulent activity
monitor timely submission of reports to Competent Authorities and report any delays and fines for any alleged breaches of regulations to the AC
fulfil any statutory responsibilities and liaise with regulators and external bodies.
supervise, monitor, coordinate and evaluate the activities of the Compliance Officers of the Bank's local and international subsidiaries in order to ensure compliance with Group standards.

The scope of activities of Group Compliance covers the following regulatory topics:

Financial Crime including laws and regulations on Anti Money Laundering (AML) and Combatting the Financing of Terrorism (CFT) and legislation aimed at combatting Tax evasion such as FATCA and CRS. The scope includes the provision of timely and accurate responses to requests arising from regulatory and judicial authorities for the lifting of banking secrecy or freezing of assets and co-operation with them to facilitate their work. The Board appoints the Money Laundering Reporting Officer and his/her Deputy
Market Integrity related regulation regarding the provision of investment products and services to clients including laws and regulations on Market Manipulation and Insider Trading
Business and internal conduct rules including Conflict of interest regulatory provisions, internal codes of conduct, antibribery and anti-corruption legislation and Antitrust and Competition laws and regulations
Consumer protection laws and regulations (including dormant accounts legislation, BoG's Code of Conduct for loans, the Payment Services Directive and the Deposit Guarantee scheme)

Any other topic for which there is a law / regulation explicitly assigning a responsibility to the Compliance function.

7. Principles of Internal Controls

The Group has established a System of Internal Controls that is based on international good practices and COSO terminology and is designed to provide reasonable assurance regarding the achievement of objectives in the following categories:

efficient and effective operations,
reliability and completeness of financial and management information,
compliance with applicable laws and regulations.

The key principles underlying the Group's system of internal controls are described below:

Control Environment: The control environment is the foundation for all components of Internal Control System, providing discipline and structure and influencing the control consciousness of employees. Integrity and high ethical values stem from management's philosophy and operating style and appropriate recruitment and training policies ensure the competence of the Group's people. The Group's organisation structure is suitable for its size and complexity with clearly defined responsibilities and reporting lines and clearly specified delegation of authority.
Risk Management: the Group acknowledges that taking risks is an integral part of its business. It therefore sets mechanisms to identify those risks and assess their potential impact on the achievement of the Group's objectives. Because economic, industry, regulatory and operating conditions will continue to change, risk management mechanisms in place shall be set (and evolve) in a manner that enables to identify and deal with the specific and new risks associated with changes.
Control Activities: Internal control activities are documented in the policies and detailed procedures that are designed to ensure that operations are carried out safely and all transactions are recorded accurately in compliance with Management's directives and regulations. They occur throughout the organisation and business processes, at all levels and in all functions. One of the prime organisational measures to ensure control effectiveness in the Group is segregation of duties. Functions that shall be separated include those of approval (limits, limit excesses, specific transactions), dealing, administration (administrative input, settlement, confirmation checks, transaction approval check, documentation check, file keeping, custody) and controlling (reconciliation, limit monitoring, excess approval check, risk management, compliance checks, physical counts).
Information and Communication: Information must be identified, captured and communicated in a form and timeframe that enables people to carry out their responsibilities. The Group has set effective communication channels to ensure that information is communicated down, across and up within the organisation. Mechanisms are also in place to obtain appropriate external information as well as to communicate effectively with outside parties including regulators, shareholders and customers.
Monitoring: the Group has established mechanisms for the ongoing monitoring of activities as part of the normal course of operations. These include regular management and supervisory activities and other actions personnel take in performing their duties that assess the performance of internal control systems. There are also independent evaluations of the internal control system by the Internal Audit function, the scope and frequency of which depend primarily on an assessment of risks and the effectiveness of ongoing monitoring procedures. Internal control deficiencies are reported upstream, with serious matters reported to top management, the Audit Committee and the Board. Every three years the efficiency of the internal control system of HoldCo/Bank on a solo and consolidated basis is independently evaluated by a third auditing firm, other than the statutory auditor, as provided for in BoG Governor's Act 2577/2006. The evaluation report, following its assessment/acknowledgement by HoldCo/Bank competent bodies (Audit Committee and BoD) is further submitted to the BoG.

8. Shareholders' General Meeting

The Shareholders' General Meeting ("General Meeting") is the supreme body of the HoldCo/Bank, convened by the Board and entitled to resolve upon any matter concerning the HoldCo/Bank and is the only competent body to resolve on issues described in article 117 of Company Law 4548/2018 (such as amendments to the Articles of Association). All shareholders have the right to participate and vote at the General Meeting either in person or by their legal representatives according to the proposed legal procedure each time in force.

The General Meeting is in quorum and meets validly when the shareholders, present or represented, represent at least 20% (1/5) of the paid-in share capital that corresponds to the shares with voting rights ("share capital"). Resolutions are reached by absolute majority. Exceptionally, with regard to certain significant decisions such as most decisions related to share capital, mergers etc.(para 3, art. 130, Company Law 4548/2018), the General Meeting is in quorum and meets validly when the shareholders, present or represented, represent at least 50.00% (1/2) of the paid-in share capital. Resolutions on the aforementioned issues are reached by two-thirds (2/3) majority. If such quorum is not reached, the General Meeting is convened again in a repeat Meeting where lower quorum is required for all categories of resolutions.

The HFSF's Representative has the right to request the convocation of HoldCo's Shareholder's General Meeting. Such right was not exercised during 2020.

Based on the present 1.4% stake in HoldCo's share capital, the HFSF, under Law 3864/2010 as in force and the TRFA signed between the Bank, the HoldCo and the HFSF, exercises its voting rights in the General Meetings of HoldCo only for decisions concerning the amendment of the HoldCo's Articles of Association, including the increase or reduction of the capital or the corresponding authorization to the Board, the mergers, divisions, conversions, revivals, extension of term or dissolution of the HoldCo, the transfer of assets (including the sale of subsidiaries), or any other issue requiring increased majority as provided for in Company Law 4548/2018.

The Annual General Meeting is held every year before the 10th of September. An Extraordinary General Meeting may be convened by the Board when it is deemed appropriate or necessary or when required by law.

The minutes of the General Meeting are signed by the Chairperson and the Secretary of the General Meeting.

All persons appearing as shareholders of ordinary shares of the HoldCo in the registry of the Dematerialized Securities System (DSS) managed by Hellenic Central Securities Depository S.A. on the Record Date, namely at the start of the fifth day before the General Meeting, have the right to participate and vote in the General Meeting. The aforementioned record date is applicable for the Repeat Meeting as well. For each General Meeting, the Board arranges for the detailed invitation, including date, place, record date, issues on the agenda and related papers to be available to shareholders at least 20 full days before the meeting, including the proposed resolution or commenting by the Board on each issue. The detailed invitation also defines the procedure to be followed for voting by proxy, the minority shareholders rights and any available documentation relating to the General Meeting.

Standard minority rights, as described in Company Law 4548/2018, apply.

9. Other information required by Directive 2004/25/EU

Holders of securities with special control rights

The HFSF's participation interest in the HoldCo's share capital, through the ordinary shares it possesses, confers to HFSF the rights according to the legislation in force and the TRFA that has been signed between the HoldCo, the Bank and the HFSF.

Treasury Shares

The Shareholders' General Meeting can authorize the Board, under article 49 of Company Law 4548/2018, to implement a program of acquisition of treasury shares. However, according to paragraph 1 of Article 16C of Law 3864/2010, during the period of the participation of the HFSF in the share capital of the HoldCo, HoldCo is not permitted to purchase treasury shares without the approval of the HFSF (note 37 of the consolidated accounts).

For other information required by Directive 2004/25/EU regarding the: a) Major shareholdings, b) Authority to issue new shares, and c) Restrictions of voting rights, please refer to the relevant sections of the Directors' Report.

KPMG Certified Auditors S.A. 3 Stratigou Tombra Street Aghia Paraskevi 153 42 Athens, Greece Telephone +30 210 6062100 Fax +30 210 6062111

Independent Auditor's Report

To the Shareholders of Eurobank Ergasias Services and Holdings S.A.

Report on the Audit of the consolidated financial statements

Opinion

We have audited the accompanying consolidated financial statements of Eurobank Ergasias Services and Holdings S.A. (the "Company") which comprise the consolidated Balance Sheet as at 31 December 2020, the consolidated statements of Income and Other Comprehensive income, changes in Equity and Cash Flows for the year then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of Eurobank Ergasias Services and Holdings S.A. and its subsidiaries (the "Group") as at 31 December 2020 and its financial performance and its cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISA), which have been incorporated in Greek legislation. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the consolidated financial statements section of our report. We are independent of the Company and its consolidated subsidiaries in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants, as it has been incorporated into Greek legislation, and the ethical requirements that are relevant to the audit of the consolidated financial statements in Greece and we have fulfilled our ethical responsibilities in accordance with the requirements of the applicable legislation and the aforementioned Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

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

Impairment allowance on Loans and Advances to customers at amortised cost including off-balance sheet elements

Refer to Note 2.2.13 and 3.1 to the consolidated financial statements. Total impairment charge for loans and advances to customers for the year amounted to EUR 2 081 million (2019: 624 million). Total estimated credit losses as of 31 December 2020 amounted to EUR 3 477 million (2019: 7 099 million).

The key audit matter	How this matter was addressed in our audit
The estimation of expected credit losses ("ECL") on Loans and Advances to customers at amortised cost, is considered a key audit matter as it involves significant judgment and estimate with high level of complexity and subjectivity. The key areas where we identified greater levels of management judgement and estimates and therefore increased levels of audit focus in the Group's estimation of ECLs are:	Based on our audit methodology and risk assessment procedures our audit procedures included, among others: We assessed the design, implementation and operating effectiveness of the key controls over the application of the staging allocation criteria ("SICR"). With the involvement of our financial risk modelling specialists we assessed the design and implementation of internal controls over model validation.
— Significant Increase in Credit Risk ("SICR") – The identification of qualitative indicators for identifying a significant increase in credit risk is highly judgmental and can materially impact the ECL recognized for facilities with a tenor greater than 12 months as these determine whether a 12 month or lifetime provision is recorded taking also into account the current economic uncertainty as a result of COVID-19 and moratoria programs.	We assessed the design, implementation and operating effectiveness of internal controls over the ECL measurement of credit impaired loans assessed on an individual basis. We assessed the design, implementation and operating effectiveness of internal controls over governance and approval of ECL and management overlays. With the involvement of our financial risk modelling specialists: ⎯ We evaluated Group's IFRS 9 impairment methodologies applied;

The key audit matter

How this matter was addressed in our
audit

The estimation of expected credit
losses ("ECL") on Loans and
Advances to customers at amortised
cost, is considered a key audit matter
as it involves significant judgment and
estimate with high level of complexity
and subjectivity. The key areas where
we identified greater levels of
management judgement and estimates
and therefore increased levels of audit
focus in the Group's estimation of
ECLs are:

Based on our audit methodology and risk
assessment procedures our audit
procedures included, among others:
We assessed the design, implementation
and operating effectiveness of the key
controls over the application of the staging
allocation criteria ("SICR").
With the involvement of our financial risk
modelling specialists we assessed the
design and implementation of internal
controls over model validation.

—
Significant Increase in Credit Risk
("SICR") – The identification of
qualitative indicators for identifying
a significant increase in credit risk
is highly judgmental and can
materially impact the ECL
recognized for facilities with a
tenor greater than 12 months as
these determine whether a
12 month or lifetime provision is
recorded taking also into account
the current economic uncertainty
as a result of COVID-19 and
moratoria programs.

We assessed the design, implementation
and operating effectiveness of internal
controls over the ECL measurement of
credit impaired loans assessed on an
individual basis.
We assessed the design, implementation
and operating effectiveness of internal
controls over governance and approval of
ECL and management overlays.
With the involvement of our financial risk
modelling specialists:
⎯
We evaluated Group's IFRS 9
impairment methodologies applied;

Model estimations Inherently judgmental modelling is used to estimate ECL which involves determining Probabilities of Default ("PD"), Loss Given Default ("LGD"), and Exposures Default ("EAD"). The PD models are the key drivers of complexity in the ECL and impact the staging of assets and as a result are considered the most significant judgmental aspect of the Group's ECL modelling approach.
Individually assessed stage 3 exposures carrying value – The carrying value of Loans and Advances to customers, may be materially misstated if individual impairments are not appropriately identified and estimated. The identification of impaired assets and the estimation of impairment are highly judgmental. The estimation of future cash flows, valuation of collateral and probability weighting of scenarios are the assumptions with high estimation uncertainty.
Management overlays Adjustments to the model-driven ECL results are raised by management to address known impairment model limitations or emerging trends as well as risks not captured by models. These adjustments are inherently uncertain and significant management judgement is involved in estimating these amounts especially in relation to current economic uncertainty as a result of COVID-19.
Economic scenarios IFRS 9 requires the Group to measure ECLs on an unbiased forwardlooking basis reflecting a range of future economic conditions. Significant management judgement is applied in determining the economic scenarios used and the probability

⎯ We evaluated models development SICR inclusive, and we performed substantive procedures over model functionality, key ECL assumptions and risk parameters used in the models.

For lending exposures across all stages we reperformed the calculation of ECL, with the support of our financial risk modelling specialists where appropriate.

We performed substantive procedures in order to assess the reasonable and appropriateness of the macroeconomic variables' forecasts, scenarios, weights and models applied, including COVID-19 pandemic outbreak expected impact.

We performed substantive procedures over the staging allocation for lending exposures, COVID-19 pandemic outbreak impact inclusive.

We performed substantive procedures in order to assess the accuracy of critical data input used in the ECL models.

We performed substantive procedures in order to assess the reasonableness of significant assumptions used in the measurement of impairment of individually assessed credit impaired exposures, including valuation of collaterals where we have used the expertise of independent real estate valuators as well as assumptions used for estimating future discounted cash flows.

We assessed the ECL movement and the overall coverages per portfolio. We also evaluated the appropriateness management overlays, COVID-19 pandemic outbreak expected impact inclusive.

weightings applied to them especially when considering the current uncertain economic environment as a result of COVID-19.

The disclosures regarding the Group's application of IFRS 9 are key to explaining the key judgements and material inputs to the IFRS 9 ECL results.

We assessed the appropriateness and the completeness of relevant disclosures and whether these disclosers address the uncertainty that exists when determining the ECL and if are aligned to the regulatory expectations for COVID-19 pandemic outbreak related disclosures.

Recognition of deferred tax assets

Refer to Note 2.2.16 (ii) and 3.5 to the consolidated financial statements. Total deferred tax recognized as of 31 December 2020 amounted to EUR 4 505 million (2019: EUR 4 757 million).

The key audit matter	How the matter was addressed in our audit
The recognition and carrying value of deferred tax assets is considered a key audit matter as it is based on estimates of future profitability, which require significant management judgement and include the risk of management bias. The recognition of deferred tax assets considers the future profit forecasts of the Group. Judgements and especially	Our audit procedures included, among others: Based on our knowledge of the Group's operations and its industry and our understanding of the applicable tax laws and regulations to the Group we performed the following procedures with the assistance of our tax specialists. — We assessed the design and
challenging complex and subjective assumptions that are difficult to audit due to the forward-looking nature and inherent uncertainties associated with such assumptions include:	implementation of the controls relevant to the recognition and recoverability of deferred tax assets including approval of business plans and monitoring of actual results against budgeted.
— Revenue forecasts which are also impacted by delivery of the Group's Strategy.	— We evaluated the appropriateness of the assumptions used by Management in the approved business plan by comparing the revenue and growth
— Macroeconomic and model assumptions used in the recoverability assessments ( growth rates, macroeconomic scenarios) including also assumptions regarding the economic consequences of COVID -19.	projections to industry trends and ensuring consistency with Management's strategic plans. — We assessed the historical accuracy of Management's assumptions by comparing them to actual results reported.

	— We assessed the adjustments performed by management to convert accounting results to taxable results and we assessed their consistency with prior years while we assessed the appropriateness of the time horizon used for the amortization of certain components of the deferred tax asset. — We evaluated the adequacy and appropriateness of the disclosures included in the consolidated financial statements.
Use of IT systems relevant to the financial information
The key audit matter	How the matter was addressed in our audit
The Group's financial reporting processes are highly reliant on information produced by the Group's Information Technology (IT) systems, and / or automated processes and controls (i.e. calculations, reconciliations) implemented in these systems. The nature, complexity and the increased use of these information systems combined with the large volume of transactions being processed daily, increase the risk over the effective inter-connectivity of the IT systems and data and the risk around the degree of reliability of the financial reporting information. The banking environment is also subject to several internal and external threats relating to cyber security particularly due to the significant increase in the volume of transactions through internet. The above is a key audit matter as the Group's financial reporting systems rely heavily on complex information systems that process huge amount of transactions and are functioning based on the operating effectiveness of internal controls in place to assure the completeness and accuracy of financial information and security information of the Group that produce the financial information.	Our audit procedures included, among others: We assessed the information security resilience of the Group by evaluating the design of key IT processes and controls over financial reporting. More specifically, involving our IT specialists, we assessed the administration of access, changes and daily IT operations for key layers of underlying infrastructure (i.e. application, operating system and database) for the systems in scope of the audit, and tested the operating effectiveness of the processes and controls. In addition, to place reliance on the system generated information (i.e. data and reports) and any automated controls (i.e. calculations, reconciliations) implemented in these systems, we have relied on business process controls, and performed additional substantive procedures as part of our audit.

Hive down and derecognition of loans following transfer through securitization (Cairo transaction)

Refer to Note 44 to the consolidated financial statements.

The key audit matter	How the matter was addressed in our audit
The Group in order to expedite the NPE reduction acceleration plan and in line with its strategic plan proceed to the following actions:	Our audit procedures included, among others in order to evaluate the Group's process in establishing the hive down and its position on derecognition of transferred
In June 2019 proceed in the securitization of euro 7.5 billion of NPE loans (Cairo securitization).	loans: a) We examined the related legal documents for the hive down, the
In March 2020 Eurobank Ergasias Services and Holdings S.A. (former Eurobank Ergasias S.A) proceeded to the hive down of the banking sector	transformation balance sheet and the related accounting entries to ascertain whether this was done in accordance with IFRS.
that was transferred to a newly established financial institution named Eurobank S.A	b) We examined relevant asset transfer agreements and other related legal documents including the operational
In June 2020 the sale of the 80% of Eurobank FPS S.A to DoValue Greece Holding S.A. was completed and the Group recognized a gain before tax of euro 219 million. At the same time, the sale of part of mezzanine and junior	agreement of the related securitization vehicles as well as the relevant quantitative assessment performed by the Group to ascertain whether the criteria for derecognition according to IFRS are met.
notes took place. Finally, the Group proceeded in the distribution of the shares of the SPV that possessed the mezzanine and junior notes to its shareholders. Upon	c) We analysed the contractual terms, substantial assumptions and conditions to assess if the Group retained control over the transferred loans.
the completion of the above transaction the Group ceased to control the securitized loans and derecognized the loans (Cairo	d) We reviewed and assessed the accounting policy of the Group and the accounting assessment for the specific transactions.
transaction). The impairment loss that the Group recognized for Cairo portfolio amounted to euro 1,5 billion before tax.	We examined the adequacy of the disclosures about these transactions in the consolidated financial statements.
Due to the complexity and magnitude of the above transactions and the significance of their relating accounting effect we have considered above transactions as a key audit matter.

Other Information

Management is responsible for the other information. The other information comprises the information included in the Board of Directors' Report for which reference is made in the "Report on Other Legal and Regulatory Requirements" and the Declarations of the Members of the Board of Directors but does not include the consolidated financial statements and our Auditor's Report thereon.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards as adopted by the European Union, and for such internal control as Management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

The Audit Committee (article 44 of L. 4449/2017) of the Company is responsible for overseeing the Group's financial reporting process.

Auditor's Responsibilities for the Audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs which have been incorporated in Greek legislation will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with ISAs, which have been incorporated in Greek legislation, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.
Conclude on the appropriateness of Management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on these consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters.

We describe these matters in our auditors' report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. Board of Directors' Report

Taking into consideration that Management is responsible for the preparation of the Board of Directors' Report and the Corporate Governance Statement that is included in this report for listed entities, pursuant to the provisions of paragraph 5 of Article 2 of Law 4336/2015 (part B), we note that:

(a) The Board of Directors' Report includes a Corporate Governance Statement which provides the information set by Article 152 of L. 4548/2018.
(b) In our opinion, the Board of Directors' Report has been prepared in accordance with the applicable legal requirements of Articles 150 and 151 and 153 and 154 and of paragraph 1 (cases c and d) of article 152 of L. 4548/2018 and its contents correspond with the accompanying consolidated financial statements for the year ended 31 December 2020.
(c) Based on the knowledge acquired during our audit, relating to Eurobank Ergasias Services and Holdings S.A. and its environment, we have not identified any material misstatements in the Board of Directors' Report.

2. Additional Report to the Audit Committee

Our audit opinion on the consolidated financial statements is consistent with the Additional Report to the Audit Committee of the Company dated 12 April 2021, pursuant to the requirements of article 11 of the Regulation 537/2014 of the European Union (EU).

3. Provision of non Audit Services

We have not provided to the Company and its subsidiaries any prohibited non – audit services referred to in article 5 of regulation (EU) 537/2014.

The permissible non-audit services that we have provided to the Company and its subsidiaries during the year ended 31 December 2020 are disclosed in Note 47 of the accompanying consolidated financial statements.

4. Appointment of Auditors

We were appointed for the first time as Certified Auditors of the Company based on the decision of the Annual General Shareholders' Meeting dated 10 July 2018. From then onwards our appointment has been renewed uninterruptedly for a total period of 3 years based on the annual decisions of the General Shareholders' Meeting.

Athens, 15 April 2021 KPMG Certified Auditors S.A. AM SOEL 114

Harry Sirounis, Certified Auditor AM SOEL 19071

EUROBANK ERGASIAS SERVICES and HOLDINGS S.A.

C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S

FOR THE YEAR ENDED 31 DECEMBER 2020

8 Othonos Street, Athens 105 57, Greece www.eurobankholdings.gr, Tel.: (+30) 214 40 61000 General Commercial Registry No: 000223001000

Index to the Consolidated Financial Statements Page
Consolidated Balance Sheet 1
Consolidated Income Statement 2
Consolidated Statement of Comprehensive Income3
Consolidated Statement of Changes in Equity4
Consolidated Cash Flow Statement5

1.	General information 6
2.	Basis of preparation and principal accounting policies 6
2.1	Basis of preparation6
2.2	Principal accounting policies13
3.	Critical accounting estimates and judgments in applying accounting policies39
4.	Capital Management 48
5.	Financial risk management and fair value 50
	5.2.1 Credit Risk 53
	5.2.2 Market risk87
	5.2.3 Liquidity risk91
	5.2.4 Interest Rate Benchmark reform – IBOR reform 94
5.3	Fair value of financial assets and liabilities96
6.	Net interest income 100
7.	Net banking fee and commission income101
8.	Income from non banking services101
9.	Net trading income and gains less losses from investment securities 101
10.	Other income/ (expenses) 102
11.	Operating expenses102
12.	Other impairments, restructuring costs and provisions103
13.	Income tax 104
14.	Earnings per share 108
15.	Cash and balances with central banks108
16.	Cash and cash equivalents and other information on cash flow statement109
17.	Due from credit institutions109
18.	Securities held for trading110
19.	Derivative financial instruments and hedge accounting110
20.	Loans and advances to customers113
21.	Impairment allowance for loans and advances to customers117
22.	Investment securities119
23.	Group composition 122

24.	Investments in associates and joint ventures128
25.	Structured Entities131
26.	Property and equipment 134
27.	Investment property135
28.	Goodwill and other intangible assets 137
29.	Other assets138
30.	Disposal groups classified as held for sale and discontinued operations139
31.	Due to central banks140
32.	Due to credit institutions141
33.	Due to customers141
34.	Debt securities in issue 142
35.	Other liabilities 143
36.	Standard legal staff retirement indemnity obligations144

37.	Share capital, share premium and treasury shares 146
38.	Reserves and retained earnings147
39.	Preferred securities 148
40.	Transfers of financial assets148
41.	Leases 149
42.	Contingent liabilities and other commitments151
43.	Operating segment information 152
44.	Corporate Transformation-Hive down156
45.	Post balance sheet events 161
46.	Related parties161
47.	External Auditors163
48.	Board of Directors163

Consolidated Balance Sheet

		31 December
		2020	2019
	Note	€ million	€ million
ASSETS
Cash and balances with central banks	15	6,637	4,679
Due from credit institutions	17	3,336	3,007
Securities held for trading	18	87	110
Derivative financial instruments	19	2,552	2,262
Loans and advances to customers	20	37,424	37,365
Investment securities	22	8,365	7,951
Investments in associates and joint ventures	24	276	235
Property and equipment	26	778	746
Investment property	27	1,459	1,184
Goodwill and other intangible assets	28	254	378
Deferred tax assets	13	4,526	4,766
Other assets	29	1,995	2,003
Assets of disposal groups classified as held for sale	30	39	75
Total assets		67,728	64,761
LIABILITIES
Due to central banks	31	7,999	1,900
Due to credit institutions	32	1,502	5,022
Derivative financial instruments	19	2,939	2,726
Due to customers	33	47,290	44,841
Debt securities in issue	34	1,556	2,406
Other liabilities	35	1,197	1,191
Liabilities of disposal groups classified as held for sale	30	-	8
Total liabilities		62,483	58,094
EQUITY
Share capital	37	815	852
Share premium	37	8,055	8,054
Reserves and retained earnings	38	(3,625)	(2,241)
Preferred securities	39	-	2
Total equity		5,245	6,667
Total equity and liabilities		67,728	64,761

Consolidated Income Statement

		Year ended 31 December
		2020	2019
	Note	€ million	€ million

Interest income		1,955	2,116
Interest expense		(606)	(739)
Net interest income	6	1,349	1,377
Banking fee and commission income		426	413
Banking fee and commission expense		(128)	(119)
Net banking fee and commission income	7	298	294

Income from non banking services	8	86	60
Net trading income/(loss)	9	3	(20)
Gains less losses from investment securities	9	430	78
Other income/(expenses)	10	235	55
Operating income		2,401	1,844
Operating expenses	11	(869)	(901)
Profit from operations before impairments, provisions and restructuring costs		1,532	943
Impairment losses relating to loans and
advances to customers	21	(2,081)	(624)
Impairment losses on goodwill	28	(160)	(62)
Other impairment losses and provisions	12	(43)	(32)
Restructuring costs	12	(145)	(88)
Share of results of associates and joint ventures	24	21	23
Profit/(loss) before tax		(876)	160
Income tax	13	(337)	(31)
Net profit/(loss) from continuing operations		(1,213)	129

Net profit/(loss) from discontinued operations	30	-	(2)
Net profit/(loss) attributable to shareholders		(1,213)	127
		€	€
Earnings/(losses) per share
-Basic and diluted earnings/(losses) per share	14	(0.33)	0.04

Earnings/(losses) per share from continuing operations
-Basic and diluted earnings/(losses) per share	14	(0.33)	0.04

Consolidated Statement of Comprehensive Income

	Year ended 31 December
	2019 2020
	€ million		€ million
Net profit/(loss)		(1,213)		127
Other comprehensive income:
Items that are or may be reclassified subsequently to profit or loss:
Cash flow hedges
- changes in fair value, net of tax	(5)		12
- transfer to net profit, net of tax	(2)	(7)	(17)	(5)
Debt securities at FVOCI
- changes in fair value, net of tax (note 22)	216		705
- transfer to net profit, net of tax (notes 9 and 22)	(340)	(124)	(290)	415
Foreign currency translation
- foreign operations' translation differences	(0)	(0)	2	2
Associates and joint ventures
- changes in the share of other comprehensive
income, net of tax (note 24)	(19)	(19)	47	47
		(150)		459
Items that will not be reclassified to profit or loss:
- Actuarial gains/(losses) on post employment
benefit obligations, net of tax	(1)	(1)	(4)	(4)
Other comprehensive income		(151)		455
Total comprehensive income attributable to shareholders:
- from continuing operations		(1,364)		584
- from discontinued operations		-		(2)
		(1,364)		582

Consolidated Statement of Changes in Equity

	Share capital € million	Share premium € million	Reserves and retained earnings € million	Preferred securities € million	Non controlling interests € million	Total € million

Balance at 1 January 2019	655	8,055	(3,709)	42	0	5,043
Net profit/(loss)	-	-	127	-	(0)	127
Other comprehensive income	-	-	455	-	(0)	455
Total comprehensive income for the
year ended 31 December 2019	-	-	582	-	(0)	582
Merger with Grivalia Properties REIC
(note 23)	197	-	890	-	-	1,087
Purchase/sale of treasury shares	(0)	(1)	0	-	-	(1)
Preferred securities' redemption and
dividend paid, net of tax	-	-	(4)	(40)	-	(44)
	197	(1)	886	(40)	-	1,042

Balance at 31 December 2019	852	8,054	(2,241)	2	0	6,667

Balance at 1 January 2020	852	8,054	(2,241)	2	0	6,667
Net profit/(loss)	-	-	(1,213)	-	(0)	(1,213)
Other comprehensive income	-	-	(151)	-	(0)	(151)
Total comprehensive income for the
year ended 31 December 2020	-	-	(1,364)	-	(0)	(1,364)
Share capital decrease and capitalization
of taxed reserves (notes 37 and 44)	(37)	-	(21)	-	-	(58)
Purchase/sale of treasury
shares (note 37)	0	1	(1)	-	-	0
Preferred securities' redemption and dividend paid, net of tax	-	-	(0)	(2)	-	(2)
Changes in participating interests in
subsidiary undertakings	-	-	1	-	0	1
Other	-	-	1	-	-	1
	(37)	1	(20)	(2)	0	(58)

Balance at 31 December 2020	815	8,055	(3,625)	-	0	5,245
	Note 37	Note 37	Note 38	Note 39

Consolidated Cash Flow Statement

		Year ended 31 December
		2020	2019
	Note	€ million	€ million
Cash flows from continuing operating activities

Profit before income tax from continuing operations Adjustments for :		(876)	160
Impairment losses relating to loans and advances to customers	21	2,081	624
Impairment losses on goodwill	28	160	62
Other impairment losses, provisions and restructuring costs	12	188	120
Depreciation and amortisation	11	109	109
Other (income)/losses οn investment securities	16	(398)	(73)
Valuation of investment property	27	(3)	(61)
Other adjustments	16,24	(230)	(50)
		1,031	891
Changes in operating assets and liabilities
Net (increase)/decrease in cash and balances with central banks		(51)	19
Net (increase)/decrease in securities held for trading		23	(67)
Net (increase)/decrease in due from credit institutions		(107)	(768)
Net (increase)/decrease in loans and advances to customers		(1,982)	(1,223)
Net (increase)/decrease in derivative financial instruments		39	150
Net (increase)/decrease in other assets		(79)	(180)
Net increase/(decrease) in due to central banks and credit institutions		2,525	(1,710)
Net increase/(decrease) in due to customers		2,251	4,655
Net increase/(decrease) in other liabilities		(133)	(68)
		2,486	808
Income tax paid		(29)	(41)
Net cash from/(used in) continuing operating activities		3,488	1,658
Cash flows from continuing investing activities
Acquisition of fixed and intangible assets		(281)	(144)
Proceeds from sale of fixed and intangible assets		26	40
(Purchases)/sales and redemptions of investment securities		(387)	966
Acquisition of subsidiaries and Grivalia, net of cash acquired	23	(47)	450
Acquisition of holdings in associates and joint ventures and
participations in capital increases	24	(16)	(4)
Disposal of subsidiaries, net of cash disposed	23	211	10
Disposal of holdings in associates and joint ventures	24	23	-
Dividends from investment securities, associates and joint ventures		3	13
Net cash from/(used in) continuing investing activities		(468)	1,331

Cash flows from continuing financing activities
(Repayments)/proceeds from debt securities in issue	34	(850)	(303)
Repayment of lease liabilities		(38)	(39)
Redemption/ buy back of preferred securities	39	(2)	(42)
Preferred securities' dividend paid	39	(0)	(3)
(Purchase)/sale of treasury shares		0	(1)
Net cash from/(used in) continuing financing activities		(890)	(388)
Effect of exchange rate changes on cash and cash equivalents		0	1
Net increase in cash and cash equivalents from continuing operations		2,130	2,602

Cash and cash equivalents at beginning of year	16	4,551	1,949
Cash and cash equivalents at end of year	16	6,681	4,551

1. General information

On 20 March 2020, the demerger of "Eurobank Ergasias S.A." (Demerged Entity) through the banking sector's hive down and its transfer to a new credit institution that has been established under the corporate name "Eurobank S.A." (the Bank) was completed. Following the above, the corporate name of the Demerged Entity has been amended to "Eurobank Ergasias Services and Holdings S.A." (the Company or Eurobank Holdings) (note 44).

The Company and its subsidiaries (the Group), consisting mainly of Eurobank S.A. Group, are active in retail, corporate and private banking, asset management, treasury, capital markets and other services. The Group operates mainly in Greece and in Central and Southeastern Europe. The Company is incorporated in Greece and its shares are listed on the Athens Stock Exchange.

These consolidated financial statements, which include the Appendix, were approved by the Board of Directors on 12 April 2021. The Independent Auditor's Report of the Financial Statements is included in the section III of the Annual Financial Report.

2. Basis of preparation and principal accounting policies

The consolidated financialstatements of the Group have been prepared on a going concern basis and in accordance with the principal accounting policies set out below:

2.1 Basis of preparation

The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting Standards (IFRS) issued by the IASB, as endorsed by the European Union (EU), and in particular with those standards and interpretations, issued and effective or issued and early adopted as at the time of preparing these consolidated financial statements.

The consolidated financial statements are prepared under the historical cost basis except for the financial assets measured at fair value through other comprehensive income, financial assets and financial liabilities (including derivative instruments) measured at fair-value-through-profit-or-loss and investment property measured at fair value.

The accounting policies for the preparation of the consolidated financial statements have been consistently applied to the years 2020 and 2019, after taking into account the amendments in IFRSs as described in section 2.1.1 "New and amended standards and interpretations". In addition, where necessary, comparative figures have been adjusted to conform to changes in presentation in the current year.

The preparation of financialstatementsin accordance with IFRS requiresthe use of estimates and judgementsthat affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of current events and actions, actual results ultimately may differ from those estimates.

The Group's presentation currency is the Euro (€) being the functional currency of the parent company. Except as indicated, financial information presented in Euro has been rounded to the nearest million. Τhe figures presented in the notes may not sum precisely to the totals provided due to rounding.

Going concern considerations

The annual financialstatements have been prepared on a going concern basis, asthe Board ofthe Directors considered as appropriate, taking into consideration the following:

During 2020 and the first quarter of 2021, the outbreak of Covid-19 pandemic and the measures adopted to contain the virus expansion defined the economic environment in Greece and globally. The deterioration of the epidemiological situation in Greece as of the fourth quarter of 2020 and the consequent pressure on the health system led to the extension of restrictive measures, including countrywide lockdowns, which have posed further uncertainties and risks for both the macroeconomic environment and the ability of numerous businesses to operate. Based on Hellenic Statistical Authority (ELSTAT) provisional data, the real GDP growth rate in 2020 registered a decrease of -8.2% on an annual basis, from 1.9% increase in 2019, mainly as a result of the drop in the final consumption expenditure and exports of services. Based on Eurostat data, the Euro-area real GDP growth rate figures were at -6.6% and 1.3% for 2020 and 2019 respectively. According to the European Commission (EC) winter economic forecasts (February 2021) the real GDP growth rate for 2021 and 2022 is expected at 3.5% and 5% respectively. Based on ELSTAT data, the average unemployment rate stood at 16.3% in 2020 (2019: 17.3%). According to EC autumn economic forecasts (November 2020) the unemployment rate was expected at 17.5% and 16.7% for 2021 and 2022 respectively. On the fiscal front, according to the 2021 Budget forecasts, the primary balances for 2020 and 2021 are expected to register a deficit of 7.2% and 3.9% of GDP respectively, as

a result of the fiscal support measures, while the gross public debt is expected at 208.9% and 199.6% of GDP for 2020 and 2021 respectively. The deviation from the Enhanced Surveillance (ES) primary surplus target of 3.5% of GDP for both 2020 and 2021 will not be considered a violation of Greece's commitments undertaken in the ES framework, as on 4 March 2020 Eurogroup decided that non-permanent deviations from the agreed fiscal paths of the member-states, due to unusual effects outside the control of their governments (i.e. the effects of the pandemic), are acceptable. According to the 15 March 2021 Eurogroup, the deviation from the ES target will continue in 2022, on a preliminary basis. The aforementioned primary balance and public debt forecasts might change significantly as a result of the actual size of the public sector's support measures and the reduction in tax revenues due to the Government's relevant moratoria and the decline of economic activity.

In response to the Covid-19 outbreak, there has been an unprecedented monetary, fiscal and regulatory support to the economy and the banking system by both Greek Government and European authorities. According to the 2021 Budget, the Greek government's planned total measures aiming to address the economic effects of the Covid-19 pandemic amount to €31.5 billion of which €23.9 billion correspond to 2020 and €7.6 billion to 2021, including the cost of the ruling of the Council of State on pension cuts. According to the Ministry of Finance as of 29 March 2021, the support measures are expected to further increase to €14.5 billion for 2021 and at €38.0 billion for 2020 and 2021. These measures include, among others: (a) the reduction of the private sector's social security contributions by 3 percentage points and the abolishment of the Special Solidarity levy for the private sector (only for 2021); the reduction of advanced income tax payment for firms and freelancers, (b) the payment by the government of the social security contributions for employees under labour suspension, (c) the suspension of VAT payments for firms affected by the Covid-19 pandemic, the social security and the tax related debt instalments for firms and freelancers, (d) the temporary economic support to wage earners under labour suspension, to seasonal employees (tourism sector), and to certain scientific sectors, (e) the Easter and Christmas bonusstate contribution for employees under laboursuspension; the employmentsubsidy under "synergasia" programme; the extension of the regular and long-term unemployment benefit, interest rates subsidies for firms that remained closed during the lock down period as well as mortgage loans subsidies to households and small businesses (Gefyra I and II). The public support for 2020 included also leverage provided by the banking system of €5.7 billion on top of the €2.6 billion of the Public Investment Budget for cash-collaterals and the co-financing of loans to small and medium size enterprises.

On top of the above, the European Council on 21 July 2020 agreed a recovery package amounting to € 750 billion under the EC's Next Generation EU framework in order to support the recovery and resilience of the member states' economies, out of which ca. € 31 billion will be available for Greece, provisionally divided to € 18.2 billion in grants and € 12.7 billion in loans. The respective amount for the Multiannual Financial Framework 2021-2027 (MFF) is at € 1,100 billion, of which ca € 40 billion will be available for Greece. Furthermore the ECB, on 24 March 2020 established a temporary Pandemic Emergency Purchase Programme (PEPP), with a financial envelope of € 1,850 billion as of mid-February 2021, out of which ca € 46 billion will be available for the purchase of Greek public and private sector securities. The PEPP came on top of the ECB liquidity measures of 12 March 2020 (additional Long Term Financing operations, more favourable terms for the Targeted Long Term Operations, new Asset Purchase Programme of € 120 billion).

In such an environment the Greek State managed to achieve continuous market access after the pandemic outbreak from April to December 2020, with the issuance of four bonds of various maturities. On 27 January 2021, the Public Debt Management Agency (PDMA) issued a 10-year bond of €3.5bn at a yield of 0.807% and more recently, on 17 March 2021, issued a 30-year bond of €2.5bn at a yield of 1.956%. On 12 March 2020, the ECB announced a number of temporary capital and operational relief measures to ensure that its directly supervised banks can continue to fulfil their role in funding the real economy. Banks will be allowed to use capital and liquidity buffers and cover Pillar 2 requirements with other than CET 1 instruments until at least the end of 2022. On the same date, the EBA and the ECB decided to postpone the stress test exercises to 2021 to allow banks to focus on and ensure continuity of their core operations, including support for their customers. In addition, the EBA stated that there is flexibility in the implementation of the EBA Guidelines on management of non-performing and forborne exposures and called for a close dialogue between supervisors and banks, also on their non-performing exposure strategies, on a case by case basis (note 5). Furthermore, on 24 June 2020 the Regulation 2020/873 (CRR quick fix) introduced targeted amendments to the Capital Requirements Regulation (CRR) to encourage banks to continue lending during the Covid-19 pandemic (note 4).

Regarding the outlook for the next 12 months, the major macroeconomic risks and uncertainties in Greece mainly relate with the outbreak of Covid-19 pandemic and are as follows: (a) the evolution of the health crisis including the probability of the continuation of the pandemic, well after the end of the first half of 2021, and its negative effect on the domestic, regional and / or global economy, (b) the progress on the vaccination programmes to contain effectively the virus expansion, (c) the actual size and duration of the fiscal measures aiming to address the effect of the pandemic on the real economy and their effect on the long-term sustainability of the country's public debt, (d) the pace of the economy's recovery in 2021 and 2022, (e) the absorption capacity of the NGEU and

MFF funds and the attraction of new investments in the country, (f) the implementation of the reforms and privatizations' agenda in order to meet the ES targets and milestones, and (g) the geopolitical conditions in the near or in broader region.

Materialization of the above Covid-19 related and other risks would have potentially adverse effects on the fiscal planning of the Greek sovereign and on the liquidity, solvency and profitability of the Greek banking sector, as well as on the realization of their Non Performing Exposures (NPE's) reduction plans. The Group is continuously monitoring the developments on the Covid-19 front and hasincreased itslevel of readiness, so asto accommodate decisions, initiatives and policiesto protect its capital and liquidity standing as well asthe fulfilment, to the maximum possible degree, of itsstrategic and business goalsfor the quarters ahead, focusing primarily on the support of its clients to overcome the challenging juncture, the mitigation of "cliff effects" post the moratoria expiration (note 5), the protection of its asset base and the resilience of its pre-provision profitability. In addition, the Group, under the extraordinary circumstances of the Covid-19 pandemic, has proceeded with the successful implementation of its Business Continuity Plan to ensure that business is continued and critical operations are unimpededly performed. In line with authorities' instructions and recommendations, the Group has taken all the required measures to ensure the health and safety of its employees and customers (e.g. implementation of teleworking, restrictions to business trips, and medical supplies for protective equipment).

Within this challenging external environment, the Group proceeded with the closing of the "Cairo" (sale of 20% of mezzanine/ 50.1% of junior Cairo securitizations' notes) and "Europe" (sale of 80% of Eurobank FPS) transactions in early June 2020, which signalled the completion of its accelerated NPE reduction plan announced in the fourth quarter of 2018. As a result the Group NPEs, following the derecognition of the Cairo securitised loan portfolio of € 7.2 billion (consisting primarily of NPEs) (note 20), were reduced to € 5.7 billion (31 December 2019: € 13 billion) driving the NPE ratio to 14.0% (31 December 2019: 29.2%) and the NPE coverage ratio to 61.9% (31 December 2019: 55.3%). In accordance with the business update for the period 2021-2022, the Group aims to proceed with a new NPE securitization of circa € 3.3 billion. Taking also into account the impact of the Covid 19 pandemic, the NPE ratio is expected to decline further to circa 9% in 2021.

As at 31 December 2020 the Group's Total Adequacy Ratio (total CAD) and Common Equity Tier 1 (CET1) ratios, taking into account the effect of the loss of € 1,508 million on Cairo transaction, the gain (after tax) of € 174 million on FPS disposal and the decrease of the share capital in kind of € 57 million (note 37), stood at 16.3% (31 December 2019: 19.2%) and 13.9% (31 December 2019: 16.7%) respectively. In January 2021, the EBA launched the 2021 EU-wide stress test exercise which will provide valuable input for assessing the resilience of the European banking sector, notably its ability to absorb shocks under adverse macroeconomic conditions, covering the period of 2021-2023. In parallel, the ECB also conducts its own stress test for the banks it directly supervises but that are not included in the EBA-led stress test sample. Eurobank participates in the ECB-led stress test. The results of both exercises will be used to assess each bank's Pillar 2 capital needs in the context of the Supervisory Review and Evaluation Process (SREP). The stress test process is currently in progress and the results are expected by the end of July 2021 (note 4).

Net loss attributable to shareholders for the year ended 31 December 2020, including the loss on Cairo transaction and the gain of FPS disposal mentioned above as well as the € 103 million restructuring costs (after tax), referring mainly to the cost for the new VES launched by the Group in September (note 35), the € 160 million deferred tax assets write-down (note 13) and the € 160 million goodwill impairment (note 28), amounted to € 1,213 million (2019: € 127 million profit). The adjusted net profit for the year ended 31 December 2020 amounted to € 544 million (31 December 2019: € 257 million profit). During the same period, the Group has increased its deposits by € 2.4 billion to € 47.3 billion (2019: € 44.8 billion) and the funding from the targeted long term refinancing operations of the European Central Bank – TLTRO III programme to € 8 billion (2019: € 1.9 billion). The rise in high quality liquid assets of the Group led the respective Liquidity Coverage ratio (LCR) to 124% (31 December 2019: 97%).

Going concern assessment

The Board of Directors, acknowledging the risks of the Covid-19 outbreak to the economy and the banking system and taking into account the above factors relating to (a) the measures adopted by the Greek and European authorities to mitigate the negative economic impact, (b) the Group's pre-provision income generating capacity and the adequacy of its capital and liquidity position and (c) the completion of the Group's NPE reduction acceleration plan and the new plan for the period 2021-2022, has been satisfied that the financial statements of the Group can be prepared on a going concern basis.

2.1.1 New and amended standards and interpretations

New and amended standards adopted by the Group as of 1 January 2020

The following new standards, amendments to standards and Conceptual Framework as issued by the International Accounting Standards Board (IASB) and endorsed by the European Union (EU), apply as of 1 January 2020:

Amendments to the Conceptual Framework for Financial Reporting, including amendments to references to the Conceptual Framework in IFRS Standards

In March 2018, the IASB issued its revised "Conceptual Framework for Financial Reporting" (Conceptual Framework). The revised Conceptual Framework is not a standard nor overrides any requirements of individual standards. This replaces the previous version of the Conceptual Framework issued in 2010. Revisions performed by IASB introduced guidance on measurement, presentation and disclosure as well as on derecognition concepts. In addition, the revision includes updated definitions of an asset/liability and of recognition criteria, as well as clarifications on important areas.

Alongside the revised Conceptual Framework, the IASB has published an accompanying document "Amendments to References to the Conceptual Framework in IFRS Standards" which contains consequential amendments to affected standards so that they refer to the revised Framework.

The adoption of the amended Framework had no impact on the consolidated financial statements.

Interest Rate Benchmark Reform - Phase 1: Amendments to IFRS 9, IAS 39 and IFRS 7

In September 2019, the IASB issued amendments to IFRS 9 "Financial Instruments", IAS 39 "Financial Instruments: Recognition and Measurement" and IFRS 7 "Financial Instruments: Disclosures" to addressthe implicationsfor certain hedge accounting requirements related to the uncertainties arising from the market-wide reform of several interest rate benchmarks (referred to as "IBOR reform"). As a result of the IBOR reform, there may be uncertainties about: a) the interest rate benchmark designated as a hedged risk and/or b) the timing or amount of the benchmark rate-based cash flows of the hedged item or the hedging instrument, during the period before the replacement of an existing interest rate benchmark with an alternative risk-free interest rate ("RFR"). The amendments modify certain hedge accounting requirements under IAS 39 or IFRS 9 in order to provide temporary reliefs from the potential effect of the uncertainty, during the transition period, which apply to all hedging relationships that are directly affected by the IBOR reform. These reliefs are related mainly to the highly probable requirement for the cash flow hedges, the compliance with the identifiable nature of the hedged risk component and the application of prospective and retrospective effectiveness tests. The amendments to IFRS 7 require additional disclosures in relation to the hedging relationships to which the above reliefs are applied.

The IASB addresses the IBOR reform and its potential effects on financial reporting in two phases. The first phase, as described above, focuses on hedge accounting issues affecting financial reporting in the period before the interest rate benchmark reform, while the second phase, effective from 1 January 2021, focuses on issues that might affect financial reporting once the existing rates are replaced with alternative rates (refer below to section ''new standards, amendments to standards and interpretations not yet adopted by the Group").

The Group has adopted Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7 - Phase 1) from 1 January 2020, while the amendments have been applied retrospectively to hedging relationships that existed on that date or were designated thereafter and that are directly affected by the IBOR reform.

As described in note 2.2.3, the Group elected, as a policy choice permitted under IFRS 9, to continue to apply hedge accounting in accordance with IAS 39. Therefore, the amendments to IAS 39 and IFRS 7 are applicable to the Group.

Due to the adoption of the reliefs as of 1 January 2020, the Group assumes that hedging relationships are unaffected by the uncertainties caused by the IBOR reform and they continue to be accounted for as continuing hedges.

The reliefs cease to apply once certain conditions are met. In particular, the Group will cease to apply the amendments regarding the reliefsin hedge accounting at the earlier of (a) when the uncertainties arising from the IBOR reform are no longer present with respect to the timing and the amount of the benchmark rate-based cash flows of the hedged items or hedging instruments, and (b) when the hedging relationships to which the reliefs apply are discontinued. The Group has assumed that this uncertainty will not end until the Group's contracts that reference IBORs are amended in order to specify the replacement of the interest rate benchmark, the date of such replacement as well as the cash flows of the RFR including the relevant spread adjustment.

The Group has set up an IBOR transition program to implement the transition to alternative interest rates that focuses on key areas of impact on customers' contracts, systems and processes, financial reporting, valuation, capital and liquidity planning and communication (note 5.2.4).

Amendments to IFRS 3 Business Combinations

The IASB issued amendments to the definition of a business in IFRS 3 "Business Combinations" to help entities determine whether an acquired set of activities and assetsis a business or not. They clarify the minimum requirementsfor a business,remove the assessment of whether market participants are capable of replacing any missing inputs or processes and add guidance to help entities assess whether an acquired process is substantive. In addition, with the introduction of the amendments the definitions of a business and of outputs are narrowed, while an optional fair value concentration test is introduced.

The adoption of the amendments had no impact on the consolidated financial statements.

Amendments to IAS 1 and IAS 8: Definition of Material

The amendments to IAS 1 "Presentation of Financial Statements" and IAS 8 "Accounting Policies, Changes in Accounting Estimates and Errors" aim to align the definition of 'material' across the standards and to clarify certain aspects of the definition. According to the new definition, information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements. The amendments clarify that materiality depends on the nature or magnitude of information, or both, while an entity should assess whether information is material on its own or when combined with other information.

The definition of material in the Conceptual Framework was also amended in order to align with the revised definition in IAS 1 and IAS 8.

The adoption of the amendments had no impact on the consolidated financial statements.

Amendment to IFRS 16 - Covid-19-Related Rent Concessions

In May 2020, the IASB issued "Covid-19-Related Rent Concessions (Amendment to IFRS 16)" that provides practical relief to lessees in accounting for rent concessions occurring as a direct consequence of COVID-19, by introducing a practical expedient to IFRS 16 "Leases". The practical expedient permits lessees not to assess whether a COVID-19-related rent concession is a lease modification and requires lessees that apply the above exemption to account for COVID-19-related rent concessions as if they were not lease modifications.

The practical expedient applies only to rent concessions occurring as a direct consequence of COVID-19 and only if all of the following conditions are met:

a) The change in lease payments results in revised consideration for the lease that is substantially the same as, or less than, the consideration for the lease immediately preceding the change;

b) Any reduction in lease payments affects only payments originally due on or before 30 June 2021; and

c) There is no substantive change to other terms and conditions of the lease.

The amendment to IFRS16, as endorsed by the EU in October 2020, is effective for the annual reporting periods beginning on or after 1 June 2020 with earlier application permitted.

The Group has early adopted the practical expedient to all rent concessions that meet the above described conditions.

In March 2021, the IASB extended by one year the application period of the above practical expedient to IFRS 16. In particular, based on the amendment performed, the lessee may apply the practical expedient to Covid-19 related rent concessions for which any reduction in lease payments affects only payments originally due on or before 30 June 2022. The amendment is effective for annual reporting periods beginning on or after 1 April 2021 and is expected to be endorsed by the EU during the first semester of 2021.

Further information on rent concessions granted to the Group as a lessee up to 31 December 2020 is provided in note 41.

New standards, amendments to standards and interpretations not yet adopted by the Group

A number of new standards and amendments to existing standards are effective after 2020, as they have not yet been endorsed by the European Union (EU), or have not been early applied by the Group. Those that may be relevant to the Group are set out below:

IAS 1, Amendments, Classification of Liabilities as Current or Non-Current (effective 1 January 2023, not yet endorsed by EU)

The amendments affect only the presentation of liabilities in the balance sheet and provide clarifications over the definition of the right to defer the settlement of a liability, while they make clear that the classification of liabilities as current or non-current should be based on rights that are in existence at the end of the reporting period. In addition, it is clarified that the assessment for liabilities classification made at the end of the reporting period is not affected by the expectations about whether an entity will exercise its right to defer settlement of a liability. The Board also clarified that when classifying liabilities as current or non-current, an entity can ignore only those conversion options that are recognised as equity.

The adoption of the amendments is not expected to impact the consolidated financial statements.

IFRS 17, Insurance Contracts (effective 1 January 2023, not yet endorsed by EU)

IFRS 17, which supersedes IFRS 4 "Insurance Contracts" provides a comprehensive and consistent accounting model for insurance contracts. It applies to insurance contracts issued, all reinsurance contracts and to investment contracts with discretionary participating features provided that the entity also issues insurance contracts. Financial guarantee contracts are allowed to be within the scope of IFRS 17 if the entity has previously asserted that it regarded them as insurance contracts.

According to IFRS 17 general model, groups of insurance contracts which are managed together and are subject to similar risks, are measured based on building blocks of discounted, probability-weighted estimates of future cash flows, a risk adjustment and a contractual service margin ("CSM") representing the unearned profit of the contracts. Under the model, estimates are remeasured at each reporting period. A simplified measurement approach may be used if it is expected that doing so a reasonable approximation of the general model is produced, or if the contracts are of short duration.

Revenue is allocated to periods in proportion to the value of expected coverage and other services that the insurer provides during the period, claims are presented when incurred and any investment components i.e. amounts repaid to policyholders even if the insured event does not occur, are not included in revenue and claims. Insurance services results are presented separately from the insurance finance income or expense.

In June 2020, the IASB issued Amendments to IFRS 17 to assist entities in its implementation. The amendments included the deferral of the effective date, so that entities would be required to apply IFRS 17 for annual periods beginning on or after 1 January 2023.

IFRS 17 is not relevant to the Group's activities, other than through its associate Eurolife FFH Insurance Group Holdings S.A.

Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest Rate Benchmark Reform – Phase 2 (effective 1 January 2021)

In August 2020, the IASB issued "Interest Rate Benchmark Reform: Phase 2 Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16", which addresses issues that affect financial reporting once an existing rate is replaced with an alternative rate (RFR) and provides specific disclosure requirements. The Phase 2 Amendments provide key reliefs related to contractual modifications due to the reform and to the hedging relationships affected by the reform.

More specifically, the amendments introduce a practical expedient if a contractual change, or changes to cash flows, result "directly" from IBOR reform and occurs on an 'economically equivalent' basis. In these cases, changes will be accounted for by updating the effective interest rate, similar to changes to a floating interest rate. A similar practical expedient will apply under IFRS 16 Leases for lessees when accounting for lease modifications required by IBOR reform.

In addition, the Phase 2 amendments permit changes required by IBOR reform to be made to hedge designations and hedge documentations without the hedging relationship being discontinued. Permitted changes include redefining the hedged risk to reference an RFR as well as redefining the description of the hedging instruments and/or the hedged items to reflect RFR.

Based on the Phase 2 amendments, when performing a retrospective hedge effectiveness assessment under IAS 39, a company may elect to reset the cumulative fair value changes of the hedged item and hedging instrument to zero immediately after ceasing to apply the Phase 1 relief on a hedge-by-hedge basis. However, actual hedge ineffectiveness will continue to be measured and recognized in full in profit or loss. The Phase 2 amendments also clarify that changes to the method for assessing hedge ineffectiveness due to the modifications required by the IBOR reform, will not result to the discontinuation of the hedge accounting.

The amendments to IFRS 4 are designed to allow insurers who are still applying IAS 39 to obtain the same reliefs as those provided by the amendments made to IFRS 9.

Consequential amendments were made by the Phase 2 Amendments to IFRS 7, to enable users of financial statements to understand the effect of interest rate benchmark reform on an entity's financial instruments and risk management strategy.

The Group is currently assessing the impact of the adoption of the Phase 2 Amendments on the consolidated financial statements.

Annual improvement to IFRSs 2018-2020 cycle: IFRS1, IFRS9 and IFRS 16 (effective 1 January 2022, not yet endorsed by EU)

The improvements introduce changes to several standards. The amendments that are relevant to the Group's activities are set out below:

The amendments to IFRS 1 "First-time Adoption of International Financial Reporting Standards" provides additional relief to a subsidiary which becomes a first-time adopter later than its parent in respect of accounting for cumulative translation differences. As a result, the amendments allow entities that have measured their assets and liabilities at carrying amounts recorded in their parent's books to also measure any cumulative translation differences using the amounts reported by the parent. This amendment will also apply to associates and joint ventures that have taken the same IFRS 1 exemption.

The amendment to IFRS 9 "Financial Instruments" clarifies which feesshould be included in the 10% test for derecognition of financial liabilities, The fees to be included in the assessment are only those paid or received between the borrower (entity) and the lender, including fees paid or received by either the borrower or lender on the other's behalf. The amendment is applied prospectively to modifications and exchanges that occur on or after the date the entity first applies the amendment.

The amendment to IFRS 16 "Leases" removes the illustration of the reimbursement of leasehold improvements, in order to avoid any potential confusion about the treatment of lease incentives.

The adoption of the amendments is not expected to impact the consolidated financial statements.

IFRS 4, Amendment, Deferral of IFRS 9 (effective 1 January 2021)

In June 2020, the IASB issued Extension of the Temporary Exemption from Applying IFRS 9 (Amendments to IFRS 4) that extends the fixed expiry date of the temporary exemption from applying IFRS 9 in IFRS 4 to annual reporting periods beginning on or after 1 January 2023, in order to align the effective dates of IFRS 9 Financial Instruments with IFRS 17 Insurance Contracts.

The amendment is not relevant to the Group's activities, other than through its associate Eurolife FFH Insurance Group Holdings S.A.

IAS 37, Amendment, Onerous Contracts – Costs of Fulfilling a Contract (effective 1 January 2022, not yet endorsed by EU)

The amendment to IAS 37 'Provisions, Contingent Liabilities and Contingent Assets' clarifies that the direct costs of fulfilling a contract include both the incremental costs and an allocation of other costs directly related to fulfilling contracts' activities. General and administrative costs do not relate directly to a contract and are excluded unless they are explicitly chargeable to the counterparty under the contract.

The adoption of the amendment is not expected to impact the consolidated financial statements.

IFRS 3, Amendments, Reference to the Conceptual Framework (effective 1 January 2022, not yet endorsed by EU)

The amendments to IFRS 3 "Business Combinations" updated the reference to the current version of Conceptual Framework while added a requirement that, for obligations within the scope of IAS 37 "Provisions, Contingent Liabilities and Contingent Assets", an acquirer applies IAS 37 to determine whether at the acquisition date a present obligation exists as a result of past events. For a levy that would be within the scope of IFRIC 21 Levies, the acquirer applies IFRIC 21 to determine whether the obligating event that gives rise to a liability to pay the levy has occurred by the acquisition date.

In addition, the issued amendments added a new paragraph to IFRS 3 to clarify that contingent assets do not qualify for recognition in a business combination at the acquisition date.

The adoption of the amendments is not expected to impact the consolidated financial statements.

IAS 8, Amendments, Definition of Accounting Estimates (effective 1 January 2023, not yet endorsed by EU)

The amendments in IAS 8 "Accounting Policies, Changes in Accounting Estimates and Errors" introduced the definition of accounting estimates and include other amendments to IAS 8 which are intended to help entities distinguish changes in accounting estimates from changes in accounting policies.

The amendments clarify (a) how accounting policies and accounting estimates relate to each other by (i) explaining that accounting estimates are used in applying accounting policies and (ii) making the definition of accounting policies clearer and more concise, (b) that selecting an estimation technique, or valuation technique, used when an item in the financial statements cannot be measured with precision, constitutes making an accounting estimate, and (c) that, in applying IAS 2 Inventories, selecting the first-in, first-out (FIFO) cost formula or the weighted average cost formula for interchangeable inventories constitutes selecting an accounting policy.

The adoption of the amendments is not expected to impact the consolidated financial statements.

Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2: Disclosure of Accounting policies (effective 1 January 2023, not yet endorsed by EU)

IASB issued amendments to IAS 1 "Presentation of Financial Statements" to require entities to disclose their material accounting policies rather than their significant accounting policies.

According to IASB, accounting policy information is material if, when considered together with other information included in an entity's financial statements, it can reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements.

Furthermore, the amendments clarify how an entity can identify material accounting policy information, while provide examples of when accounting policy information is likely to be material. The amendment to IAS 1 also clarify that immaterial accounting policy information need not be disclosed. However, if it is disclosed, itshould not obscure material accounting policy information. To support this amendment the Board has also developed guidance and examples to explain and demonstrate the application of the 'four-step materiality process' described in IFRS Practice Statement 2 Making Materiality Judgements to accounting policy disclosures, in order to support the amendments to IAS 1.

The adoption of the amendments is not expected to impact the consolidated financial statements.

2.2 Principal accounting policies

2.2.1 Consolidation

(i) Subsidiaries

Subsidiaries are all entities controlled by the Group. The Group controls an entity when it is exposed, or has rights to, variable returns from its involvement with the entity, and has the ability to affect those returns through its power over the entity. The Group consolidates an entity only when all the above three elements of control are present.

Power is considered to exist when the Group's existing rights give it the current ability to direct the relevant activities of the entity, i.e. the activities that significantly affect the entity's returns, and the Group has the practical ability to exercise those rights. Power over the entity may arise from voting rights granted by equity instruments such as shares or, in other cases, may result from contractual arrangements.

Where voting rights are relevant, the Group is deemed to have control where it holds, directly or indirectly, more than half of the voting rights over an entity, unless there is evidence that another investor has the practical ability to unilaterally direct the relevant activities.

The Group may have power, even when it holds less than a majority of the voting rights of the entity, through a contractual arrangement with other vote holders, rights arising from other contractual arrangements, substantive potential voting rights, ownership of the largest block of voting rights in a situation where the remaining rights are widely dispersed ('de facto power'), or a combination of the above. In assessing whether the Group has de facto power, it considers all relevant facts and circumstances including the relative size of the Group's holding of voting rights and dispersions of holdings of other vote holders to determine whether the Group has the practical ability to direct the relevant activities.

The Group is exposed or has rights to variable returns from its involvement with an entity when these returns have the potential to vary as a result of the entity's performance.

In assessing whether the Group has the ability to use its power to affect the amount of returns from its involvement with an entity, the Group determines whether in exercising its decision-making rights, it is acting as an agent or as a principal. The Group acts as an agent when it is engaged to act on behalf and for the benefit of another party, and as a result does not control an entity. Therefore, in such cases, the Group does not consolidate the entity. In making the above assessment, the Group considers the scope of its decision-making authority over the entity, the rights held by other parties, the remuneration to which the Group is entitled from its involvement, and its exposure to variability of returns from other interests in that entity.

The Group has interests in certain entities which are structured so that voting rights are not the dominant factor in deciding who controlsthe entity, such as when any voting rightsrelate to administrative tasks only and the relevant activities are directed by means of contractual rights. In determining whether the Group has control over such structured entities, it considers the following factors:

The purpose and design of the entity;
Whether the Group has certain rights that give it the ability to direct the relevant activities of the entity unilaterally, as a result of existing contractual arrangements that give it the power to govern the entity and direct its activities;
In case another entity is granted decision making rights, the Group assesses whether this entity acts as an agent of the Group or another investor;
The existence of any special relationships with the entity; and
The extent of the Group's exposure to variability of returns from its involvement with the entity, including its exposure in the most subordinated securitized notes issued by the entity as well as subordinated loans or other credit enhancements that may be granted to the entity, and if the Group has the power to affect such variability.

Information about the Group's structured entities is set out in note 25.

The Group reassesses whether it controls an entity if facts and circumstancesindicate that there are changesto one or more elements of control. This includes circumstances in which the rights held by the Group and intended to be protective in nature become substantive upon a breach of a covenant or default on payments in a borrowing arrangement, and lead to the Group having power over the investee.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group and are no longer consolidated from the date that control ceases. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Changes in the Group's ownership interest in subsidiaries that do not result in a loss of control are recorded as equity transactions. Any difference between the consideration and the share of the new net assets acquired is recorded directly in equity. Gains or losses arising from disposals of ownership interests that do not result in a loss of control by the Group are also recorded directly in equity. For disposals of ownership interests that result in a loss of control, the Group derecognizes the assets and liabilities of the subsidiary and any related non-controlling interest and other components of equity, and recognizes gains and losses in the income statement. When the Group ceases to have control, any retained interest in the former subsidiary is re-measured to its fair value, with any changes in the carrying amount recognized in the income statement.

Intercompany transactions, balances and intragroup gains on transactions between Group entities are eliminated; intragroup losses are also eliminated unless the transaction provides evidence of impairment of the asset transferred.

(ii) Business combinations

The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. The consideration transferred for an acquisition is measured at the fair value of the assets given, equity instruments issued or exchanged and liabilities undertaken at the date of acquisition, including the fair value of assets or liabilities resulting from a contingent consideration arrangement. Acquisition related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date irrespective of the extent of any non-controlling interest. Any previously held interest in the acquiree isremeasured to fair value at the acquisition date with any gain or lossrecognized in the income statement. The Group recognizes on an acquisition-by-acquisition basis any non-controlling interest in the acquiree either at fair value or at the non-controlling interest's proportionate share of the acquiree's net assets.

The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets of the subsidiary acquired, is

recorded as goodwill. If this is less than the fair value of the net assets of the acquiree, the difference is recognized directly in the income statement.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which it occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted retrospectively during the measurement period to reflect the new information obtained about the facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date. The measurement period adjustments, as mentioned above, affect accordingly the amount of goodwill that was initially recognized, while the measurement period cannot exceed one year from the acquisition date.

Commitments to purchase non-controlling interests through derivative financial instruments with the non-controlling interests, as part of a business combination are accounted for as a financial liability, with no non-controlling interest recognized for reporting purposes. The financial liability is measured at fair value, using valuation techniques based on best estimates available to management. Any difference between the fair value of the financial liability upon initial recognition and the nominal non-controlling interest's share of net assets is recognized as part of goodwill. Subsequent revisions to the valuation of the derivatives are recognized in the income statement.

For acquisitions of subsidiaries not meeting the definition of a business, the Group allocates the consideration to the individual identifiable assets and liabilities based on their relative fair values at the date of acquisition. Such transactions or events do not give rise to goodwill.

Where necessary, accounting policies of subsidiaries have been changed to ensure consistency with the policies of the Group.

A listing of the Bank's subsidiaries is set out in note 23.

(iii) Business combinations involving entities under common control

Pursuant to IAS 8 'Accounting Policies, Changes in Accounting Estimates and Errors', since business combinations between entities under common control are excluded from the scope of IFRS 3 'Business Combinations', such transactions are accounted for in the Group's financial statements by using the pooling of interests method (also known as merger accounting), with reference to the most recent pronouncements of other standard-setting bodies that use a similar conceptual framework and comply with the IFRS general principles, as well as accepted industry practices.

Under the pooling of interests method, the Group incorporates the assets and liabilities of the acquiree at their pre-combination carrying amounts from the highest level of common control, without any fair value adjustments. Any difference between the cost of the transaction and the carrying amount of the net assets acquired is recorded in Group's equity.

The Group accounts for the cost of such business combinations at the fair value of the consideration given, being the amount of cash or shares issued or if that cannot be reliably measured, the consideration received.

Formation of a new Group entity to effect a business combination

Common control transactions that involve the formation of a new Group entity to effect a business combination by bringing together two or more previously uncombined businesses under the new Group entity are also accounted for by using the pooling of interests method.

Other common control transactions that involve the acquisition of a single existing Group entity or a single group of businesses by a new entity formed for this purpose are accounted for as capital reorganizations, on the basis that there is no business combination and no substantive economic change in the Group. Under a capital reorganization, the acquiring entity incorporates the assets and liabilities of the acquired entity at their carrying amounts, as presented in the books of that acquired entity, rather than those from the highest level of common control. Any difference between the cost of the transaction and the carrying amount of the net assets acquired is recognized in the equity of the new entity. Capital reorganization transactions do not have any impact on the Group's consolidated financial statements.

(iv) Associates

Investments in associates are accounted for using the equity method of accounting in the consolidated financial statements. These are undertakings over which the Group exercises significant influence but which are not controlled.

Equity accounting involves recognizing in the income statement the Group's share of the associate's profit or loss for the year. The Group's interest in the associate is carried on the balance sheet at an amount that reflects its share of the net assets of the associate and any goodwill identified on acquisition net of any accumulated impairment losses. If the Group's share of losses of an associate equals or exceeds its interest in the associate, the Group discontinues recognizing its share of further losses, unless it has incurred obligations or made payments on behalf of the associate. Where necessary the accounting policies used by the associates have been changed to ensure consistency with the policies of the Group.

When the Group obtains or ceases to have significant influence, any previously held or retained interest in the entity is remeasured to its fair value, with any change in the carrying amount recognized in the income statement, except in cases where an investment in associate becomes an investment in a joint venture where no remeasurement of the interest retained is performed and use of the equity method continues to apply.

(v) Joint arrangements

A joint arrangement is an arrangement under which the Group has joint control with one or more parties. Joint control is the contractually agreed sharing of control and exists only when decisions about relevant activities require the unanimous consent of the parties sharing control. Investments in joint arrangements are classified as either joint ventures whereby the parties who share control have rights to the net assets of the arrangement or joint operations where two or more parties have rights to the assets and obligations for the liabilities of the arrangement.

The Group evaluates the contractual terms of joint arrangements to determine whether a joint arrangement is a joint operation or a joint venture. All joint arrangements in which the Group has an interest are joint ventures.

As investments in associates, the Group's interest in joint ventures is accounted for by using the equity method of accounting. Therefore, the accounting policy described in note 2.2.1 (iv) applies also for joint ventures. Where necessary the accounting policies used by the joint ventures have been changed to ensure consistency with the policies of the Group.

When the Group ceases to have joint control over an entity, it discontinues the use of the equity method. Any retained interest in the entity is remeasured to its fair value, with any change in the carrying amount recognized in the income statement, except in cases where an investment in a joint venture becomes an investment in an associate, where no remeasurement of the interest retained is performed and use of the equity method continues to apply.

A listing of the Group's associates and joint ventures is set out in note 24.

2.2.2 Foreign currencies

(i) Translation of foreign subsidiaries

Assets and liabilities of foreign subsidiaries are translated into the Group's presentation currency at the exchange rates prevailing at each reporting date whereas income and expenses are translated at the average exchange rates for the period reported. Exchange differences arising from the translation of the net investment in a foreign subsidiary, including exchange differences of monetary items receivable or payable to the foreign subsidiary for which settlement is neither planned nor likely to occur that form part of the net investment in the foreign subsidiaries, are recognized in other comprehensive income.

Exchange differences from the Group's foreign subsidiaries are released to the income statement on the disposal of the foreign subsidiary while for monetary items that form part of the net investment in the foreign subsidiary, on repayment or when settlement is expected to occur.

(ii) Transactions in foreign currency

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions are recognized in the income statement.

Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at each reporting date and exchange differences are recognized in the income statement, except when deferred in equity as qualifying cash flow or net investment hedges.

exchange at the date the fair value is determined. The exchange differences relating to these items are treated as part of the change in fair value and are recognized in the income statement or recorded directly in equity depending on the classification of the nonmonetary item.

2.2.3 Derivative financial instruments and hedging

Derivative financial instruments, including foreign exchange contracts, forward currency agreements and interest rate options (both written and purchased), currency and interest rate swaps, and other derivative financial instruments, are initially recognized in the balance sheet at fair value on the date on which a derivative contract is entered into and subsequently are re-measured at their fair value. All derivatives are carried as assets when fair value is positive and as liabilities when fair value is negative.

Fair values of derivatives are determined based on quoted market prices, including recent market transactions, or by using other valuation techniques, as appropriate. The principles for the fair value measurement of financial instruments, including derivative financial instruments, are described in notes 3.2 and 5.3.

Embedded derivatives

Financial assets that contain embedded derivatives are recognised in the balance sheet in their entirety in the appropriate classification category, following instruments' assessment of their contractual cash flows and their business model as described in note 2.2.9.

On the other hand, derivatives embedded in financial liabilities, are treated asseparate derivatives when their risks and characteristics are not closely related to those of the host contract and the host contract is not carried at fair value through profit or loss. These embedded derivatives are measured at fair value with changes in fair value recognized in the income statement.

The use of derivative financial instruments is inherent in the Group's activities and aims principally at managing risk effectively.

Accordingly, the Group, as part of its risk management strategy, may enter into transactions with external counterparties to hedge partially or fully interest rate, foreign currency, equity and other exposures that are generated from its activities.

The objectives of hedging with derivative financial instruments include:

Reduction of interest rate exposure that is in excess of the Group's interest rate limits
Efficient management of interest rate risk and fair value exposure
Management of future variable cash flows
Reduction of foreign currency risk or inflation risk

Hedge accounting

The Group has elected, as a policy choice permitted under IFRS 9, to continue to apply hedge accounting in accordance with IAS 39, until the project of accounting of macro hedging activities is completed by the IASB.

For hedge accounting purposes, the Group forms a hedging relationship between a hedging instrument and a related item or group of items to be hedged. A hedging instrument is a designated derivative or a designated non-derivative financial asset or financial liability whose fair value or cash flows are expected to offset changes in the fair value or cash flows of a designated hedged item.

Specifically, the Group designates certain derivatives as: (a) hedges of the exposure to changes in fair value of recognized assets or liabilities or unrecognized firm commitments (fair value hedge), (b) hedges of the exposure to variability in cash flows of recognized assets or liabilities or highly probable forecasted transactions (cash flow hedge) or, (c) hedges of the exposure to variability in the value of a net investment in a foreign operation which is associated with the translation of the investment's net assets in the Group's functional currency.

In order to apply hedge accounting, specified criteria should be met. Accordingly, at the inception of the hedge accounting relationship, the Group documents the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions, together with the method that will be used to assess the effectiveness of the hedging relationship. The Group also documentsits assessment, both at inception of the hedge and on an ongoing basis, of whether the derivatives that are used in the hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items and whether the actual results of each hedge are within a range of 80-125%. If a relationship does not meet the abovementioned hedge effectiveness criteria, the Group discontinues hedge accounting prospectively. Similarly, if the

hedging derivative expires or is sold, terminated or exercised, or the hedge designation is revoked, then hedge accounting is discontinued prospectively. In addition, the Group uses other derivatives, not designated in a qualifying hedge relationship, to manage its exposure primarily to interest rate and foreign currency risks. Non qualifying hedges are derivatives entered into as economic hedges of assets and liabilities for which hedge accounting was not applied. The said derivative instruments are classified along with those held for trading purposes.

The method of recognizing the resulting fair value gain or loss depends on whether the derivatives are designated and qualify as hedging instruments, and if so, the nature of the item being hedged.

Furthermore, the Group may designate groups of items as hedged items, by aggregating recognized assets or liabilities or unrecognized but highly probable transactions of similar risk characteristics that share the exposure for which they are hedged. Although the overall risk exposures may be different for the individual items in the group, the specific risk being hedged will be inherent in each of the items in the group.

As described in note 2.1.1, the Group has applied IBOR reform amendments to IFRS 9, IAS 39 and IFRS 7, issued in September 2019, that provide temporary reliefs on hedging relationships due to the potential effect of the uncertainty on the amount and timing of cash flows indexed to IBOR and/or the interest benchmark designated as a hedged risk, during the period before the replacement of an existing interest rate benchmark with an alternative risk-free rate. Based on the reliefs, for the purpose of determining whether a forecast transaction is highly probable, or a hedging relationship is expected to be highly effective, the Group assumes that the benchmark interest rate does not change as a result of the IBOR reform. In addition, the Group, is not required to discontinue hedge accounting if the hedge falls outside the 80–125% range during the period of uncertainty arising from the reform. Furthermore, in case of hedges where the hedged item or hedged risk is a non-contractually specified benchmark portion of interest rate risk, following the IBOR reform reliefs, it is assumed that the designated risk portion only needs to be separately identifiable at the inception of the hedging relationship and not on a going basis.

(i) Fair value hedge

The Group applies fair value hedging to hedge exposures primarily to changes in the fair value attributable to interest rate risk and currency risk.

The itemsthat qualify for fair value hedge accounting include fixed rate debtsecurities classified as FVOCI and amortized cost financial assets, fixed rate term deposits or term loans measured at amortized cost, as well as fixed rate debt securities in issue.

The interest rate and currency risk with respect to the applicable benchmark rate may be hedged using interest rate swaps and cross currency swaps.

The Group uses the dollar-offset method in order to assess the effectiveness of fair value hedges. This is a quantitative method that involves the comparison of the change in the fair value of the hedging instrument with the change in the fair value of the hedged item attributable to the hedged risk. Even if a hedge is not expected to be highly effective in a particular period, hedge accounting is not precluded if effectiveness is expected to remain sufficiently high over the life of the hedge.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement, together with the changes in the fair value of the hedged assets or liabilities that are attributable to the hedged risk.

The Group discontinues hedge accounting in case the hedging instrument expires or is sold, terminated or exercised, the hedge no longer meets the qualifying criteria for hedge accounting, or designation is revoked. In such cases, any adjustment to the carrying amount of the hedged item, for which the effective interest method is applied, is amortized to profit or loss over the period to maturity. Hedge ineffectiveness may arise in case of potential differences in the critical terms between the hedged item and the hedging instrument such as maturity, interest rate reset frequency and discount curves.

(ii) Cash flow hedge

The Group applies cash flow hedging to hedge exposures to variability in cash flows primarily attributable to the interest rate risk and currency risk associated with a recognized asset or liability or a highly probable forecast transaction.

The items that qualify for cash flow hedging include recognized assets and liabilities such as variable rate deposits or loans measured at amortized cost, variable rate debt securities in issue and foreign currency variable rate loans. The interest rate risk with respect to the applicable benchmark rate may be hedged using interest rate swaps and cross currency swaps. The foreign currency risk may be hedged using currency forwards and currency swaps.

Furthermore, cash flow hedging is used for hedging highly probable forecast transactions such as the anticipated future rollover of short-term deposits or repos measured at amortized cost. Specifically, the forecast variable interest payments of a series of anticipated rollovers of these financial liabilities are aggregated and hedged as a group with respect to changes in the benchmark interest rates, eliminating cash flow variability. In addition, cash flow hedging applies to hedges of currency risk arising from probable forecasted sales of financial assets or settlement of financial liabilities in foreign currency.

If the hedged item is documented as a forecast transaction, the Group assesses and verifies that there is a high probability of the transaction occurring.

In order to assess the effectiveness of cash flow hedges of interest rate risk, the Group uses regression analysis which demonstrates that there is high historical and expected future correlation between the interest rate risk designated as being hedged and the interest rate risk of the hedging instrument. For assessing the effectiveness of cash flow hedges of currency risk, the Group uses the dollaroffset method.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in other comprehensive income whereas the ineffective portion is recognized in the income statement.

Amounts accumulated in equity are recycled to the income statement in the periods in which the hedged item will affect profit or loss (for example, when the forecast sale that is hedged takes place).

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, the cumulative gain or loss existing in equity at that time remains in equity until the forecast transaction affects the income statement.

When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement.

(iii) Net investment hedge

The Group applies net investment hedging to hedge exposures to variability in the value of a net investment in foreign operation associated with the translation of the investment's carrying amount into the Group's presentation currency.

The Group invests in foreign subsidiaries, associates or other foreign operations with functional currencies different from the Group's presentation and functional currency which upon consolidation, their carrying amount is translated from the functional currency to the Group's presentation currency and any exchange differences are deferred in OCI until the net investment is disposed of or liquidated, at which time they are recognized in the profit or loss.

The item that qualifies for net investment hedge accounting is the carrying amount of the net investment in a foreign operation, including monetary items that form part of the net investment.

The foreign currency exposure that arises from the fluctuation in spot exchange rates between the net investment's functional currency and the Group's presentation currency may be hedged using currency swaps, currency forward contracts and their economic equivalents, as well as cash instruments.

The effectiveness of net investment hedges is assessed with the Dollar-Offset Method as described above for fair value hedge.

Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any gain or loss on the hedging instrument relating to the effective portion of the hedge is recognized in equity; the gain or loss relating to the ineffective portion is recognized in the income statement. Gains and losses accumulated in equity are included in the income statement when the foreign operation is disposed of as part of the gain or loss on the disposal.

(iv) Derivatives not designated as hedging instruments for hedge accounting purposes

Changes in the fair value of derivative financial instruments that are not designated as hedging instruments or do not qualify for hedge accounting are recognized in the income statement.

The fair values of derivative instruments held for trading and hedging purposes are disclosed in note 19.

2.2.4 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is presented in the balance sheet when, and only when, the Group currently has a legally enforceable right to set off the recognized amounts and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

2.2.5 Income statement

(i) Interest income and expense

Interest income and expense is recognized in the income statement for all interest bearing financial instruments on an accrual basis, using the effective interest rate (EIR) method. The effective interest rate is the rate that exactly discounts estimated future cash payments or receiptsthrough the expected life of the financial instrument or, when appropriate, a shorter period to the gross carrying amount of the financial asset or to the amortized cost of a financial liability. When calculating the EIR for financial instruments other than purchased or originated credit-impaired, the Group estimates cash flows considering all contractual terms of the financial instrument but does not consider expected credit losses. For purchased or originated credit impaired (POCI) financial assets, the Group calculates the credit-adjusted EIR, which is the interest rate that upon the original recognition of the POCI financial asset discounts the estimated future cash flows (including expected credit losses) to the fair value of the POCI asset.

The amortized cost of a financial asset or liability is the amount at which it is measured upon initial recognition minus principal repayments, plus or minus cumulative amortization using the EIR (as described above) and for financial assets it is adjusted for the expected credit loss allowance. The gross carrying amount of a financial asset is its amortized cost before adjusting for ECL allowance.

The EIR calculation includes all fees and points paid or received that are an integral part of the effective interest rate, transaction costs, and all other premiums or discounts. Transaction costsinclude incremental coststhat are directly attributable to the acquisition or issue of a financial asset or liability.

The Group calculates interest income and expense by applying the EIR to the gross carrying amount of non-impaired financial assets (exposures in Stage 1 and 2) and to the amortized cost of financial liabilities respectively.

For financial assets that have become credit-impaired subsequent to initial recognition (exposures in Stage 3), the Group calculates interest income by applying the effective interest rate to the amortized cost of the financial asset (i.e. gross carrying amount adjusted for the expected credit loss allowance). If the asset is no longer credit-impaired, then the EIR is applied again to the gross carrying amount.

For financial assetsthat were credit-impaired on initial recognition (POCI) interest income is calculated by applying the credit-adjusted EIR (calculated as described above) to the POCI asset's amortized cost. For such assets even if the credit risk improves, interest income does not revert to gross basis calculation. For inflation-linked instruments the Group recognizes interest income and expense by adjusting the effective interest rate on each reporting period due to changes in expected future cash flows, incorporating changes in inflation expectations over the term of the instruments. The adjusted effective interest rate is applied in order to calculate the new gross carrying amount on each reporting period.

Interest income and expense is presented separately in the income statement for all interest bearing financial instruments within net interest income.

(ii) Fees and commissions

Fee and commission received or paid that are integral to the effective interest rate on a financial asset or financial liability are included in the effective interest rate.

imports-exports, remittances, bank charges and brokerage activities are recognised at the point in time when the transaction takes place. Other fee and commission expenses relate mainly to transaction and service fees, which are expensed as the services are received.

In the case of a contract with a customer that results in the recognition of a financial instrument in the Group's financial statements which may be partially in the scope of IFRS 9 and partially in the scope of IFRS 15, the Group first applies IFRS 9 to separate and measure the part of the contract that is in the scope of IFRS 9 and subsequently applies IFRS 15 to the residual part.

2.2.6 Property, equipment and Investment property

(i) Property and equipment

Property and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. Subsequent expenditure is recognized in the asset's carrying amount only when it is probable that future economic benefits will flow to the Group and the cost of the asset can be measured reliably. All other repair and maintenance costs are recognized in the income statement as incurred.

Depreciation is calculated using the straight-line method to write down the cost of property and equipment, to their residual values over their estimated useful life as follows:

Land: no depreciation;
Freehold buildings: 40-50 years;
Leasehold improvements: over the lease term or the useful life of the asset if shorter;
Computer hardware and related integral software: 4-10 years;
Other furniture and equipment: 4-20 years; and
Motor vehicles: 5-7 years.

(ii) Investment property

Property held for rental yields and/or capital appreciation that is not occupied by the Group's entities is classified as investment property.

Investment property is measured initially at its cost, including related transaction costs. Under fair value model of IAS 40 "Investment property" after initial recognition, investment property is carried at fair value as determined by independent certified valuers, with any change therein recognized in income statement. Investment property under construction is measured at fair value only if it can be measured reliably.

Subsequent expenditure is charged to the asset's carrying amount only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. Repairs and maintenance costs are recognized to the income statement during the financial period in which they are incurred.

Investment property is derecognised when disposed or when it is permanently withdrawn from use and there is no future economic benefit expected from its disposal. Any arising gain or loss (calculated as the difference between the net proceeds from disposal and the carrying amount of the asset) is recognized in income statement.

If an investment property becomes owner-occupied, it is reclassified as property and equipment and its fair value at the date of reclassification becomes its deemed cost. If an item of property and equipment becomes an investment property because its use has changed, any resulting decrease between the carrying amount and the fair value of this item at the date of transfer is recognized in income statement while any resulting increase, to the extent that the increase reverses previous impairment loss for that property, is recognized in income statement while any remaining part of the increase is recognized in other comprehensive income and increases the revaluation surplus within equity.

If a repossessed asset becomes investment property, any difference between the fair value of the property at the date of transfer and its previous carrying amount is recognized in income statement.

Reclassifications among own used, repossessed assets and investment properties may occur when there is a change in the use ofsuch properties. Additionally, an investment property may be reclassified to 'non-current assets held for sale' category to the extent that the criteria described in note 2.2.25 are met.

2.2.7 Intangible assets

(i) Goodwill

Goodwill represents the excess of the aggregate of the fair value of the consideration transferred, the amount of any non-controlling interest and the acquisition date fair value of any previously held equity interest in the acquiree over the fair value of the Group's share of net identifiable assets and contingent liabilities acquired. Goodwill arising on business combinations is included in 'intangible assets' and is measured at cost less accumulated impairment losses.

Goodwill arising on acquisitions of associates and jointly controlled entities is neither disclosed nor tested separately impairment, but instead is included in 'investments in associates' and 'investments in jointly controlled entities'.

(ii) Computer software

Costs associated with the maintenance of existing computer software programs are expensed as incurred. Development costs associated with the production of identifiable assets controlled by the Group are recognized as intangible assets when they are expected to generate economic benefits and can be measured reliably. Internally generated computer software assets are amortized using the straight-line method over 4 years, except for core systems whose useful life may extend up to 20 years.

(iii) Other intangible assets

Other intangible assets are assets that are separable or arise from contractual or other legal rights and are amortized over their estimated useful lives. These include intangible assets acquired in business combinations.

Intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment.

2.2.8 Impairment of non-financial assets

(i) Goodwill

Goodwill arising on business combinations is not amortized but tested for impairment annually or more frequently if there are any indications that impairment may have occurred. The Group's impairment test is performed each year end. The Group considers external information such as prevailing economic conditions, persistent slowdown in financial markets, volatility in markets and changes in levels of market and exchange risk, an unexpected decline in an asset's market value or market capitalization being below the book value of equity, together with a deterioration in internal performance indicators, in assessing whether there is any indication of impairment.

For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each Cash Generating Unit (CGU) or groups of CGUs that are expected to benefit from the synergies of the combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the Group at which goodwill is monitored for internal management purposes. The Group monitors goodwill either at the separate legal entity level or group of legal entities consistent with the internal monitoring of operating segments.

The Group impairment model compares the carrying value of a CGU or group of CGUs with itsrecoverable amount. The carrying value of a CGU is based on the assets and liabilities of each CGU. The recoverable amount is determined on the basis of the value-in-use which is the present value of the future cash flows expected to be derived from the CGU or group of CGUs. The estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU and the countries where the CGUs operate.

An impairment loss arises if the carrying amount of an asset or CGU exceeds its recoverable amount, and is recognized in the income statement. Impairment losses are not subsequently reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

(ii) Other non-financial assets

to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows, where applicable. Non-financial assets, other than goodwill, for which an impairment loss was recognized in prior reporting periods, are reviewed for possible reversal of such impairment at each reporting date.

Impairment losses arising from the Group's associates and joint ventures are determined in accordance with this accounting policy.

2.2.9 Financial assets

Financial assets - Classification and measurement

The Group classifies financial assets based on the business model for managing those assets and their contractual cash flow characteristics. Accordingly, financial assets are classified into one of the following measurement categories: amortized cost, fair value through other comprehensive income or fair value through profit or loss.

Purchases and sales of financial assets are recognized on trade date, which is the date the Group commits to purchase or sell the assets. Loans originated by the Group are recognized when cash is advanced to the borrowers.

Financial Assets measured at Amortized Cost ('AC')

The Group classifies and measures a financial asset at AC only if both of the following conditions are met and is not designated as at FVTPL:

(a) The financial asset is held within a business model whose objective is to collect contractual cash flows (hold-to-collect business model) and

(b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (SPPI).

These financial assets are recognized initially at fair value plus direct and incremental transaction costs, and are subsequently measured at amortized cost, using the effective interest rate (EIR) method (as described in note 2.2.5 above).

Interest income, realized gains and losses on derecognition, and changes in expected credit losses from assets classified at AC, are included in the income statement.

Financial Assets measured at Fair Value through Other Comprehensive Income ('FVOCI')

The Group classifies and measures a financial asset at FVOCI only if both of the following conditions are met and is not designated as at FVTPL:

(a) The financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets (hold-to-collect-and-sell business model) and

(b) The contractual terms of the financial asset give rise on specified dates to cash flows that are SPPI.

Financial assets that meet these criteria are debt instruments and are measured initially at fair value, plus direct and incremental transaction costs.

Subsequent to initial recognition, FVOCI debt instruments are re-measured at fair value through OCI, except for interest income, related foreign exchange gains or losses and expected credit losses, which are recognized in the income statement. Cumulative gains and losses previously recognized in OCI are transferred from OCI to the income statement when the debt instrument is derecognised.

Equity Instruments designated at FVOCI

The Group may make an irrevocable election to designate an equity instrument at FVOCI. This designation, if elected, is made at initial recognition and on an instrument by instrument basis. Gains and losses on these instruments, including when derecognized, are recorded in OCI and are not subsequently reclassified to the income statement. Dividends received are recorded in the income statement.

Financial Assets measured at Fair Value through Profit and Loss ("FVTPL")

The Group classifies and measures all other financial assets that are not classified at AC or FVOCI, at FVTPL. Accordingly, this measurement category includes debt instruments such as loans and debt securities that are held within the hold–to-collect (HTC) or hold-to-collect-and-sell models (HTCS), but fail the SPPI assessment, equities that are not designated at FVOCI and financial assets held for trading. Derivative financial instruments are measured at FVTPL, unless they are designated and effective hedging instruments, in which case hedge accounting requirements under IAS 39 continue to apply.

Furthermore, a financial asset that meets the above conditions to be classified at AC or FVOCI, may be irrevocably designated by the Group at FVTPL at initial recognition, if doing so eliminates, or significantly reduces an accounting mismatch that would otherwise arise.

Financial assets measured at FVTPL are initially recorded at fair value and any unrealized gains or losses arising due to changes in fair value are included in the income statement.

Business model and contractual characteristics assessment

The business model assessment determines how the Group manages a group of assets to generate cash flows. That is, whether the Group's objective is solely to collect contractual cash flows from the asset, to realize cash flows from the sale of assets, or both to collect contractual cash flows and cash flows from the sale of assets. In addition, the business model is determined after aggregating the financial assets into groups (business lines) which are managed similarly rather than at an individual instrument's level.

The business model is determined by the Group's key management personnel consistently with the operating model, considering how financial assets are managed in order to generate cash flows, the objectives and how performance of each portfolio is monitored and reported and any available information on past sales and on future sales' strategy, where applicable.

Accordingly, in making the above assessment, the Group will consider a number of factors including the risks associated with the performance of the business model and how those risks are evaluated and managed, the related personnel compensation, and the frequency, volume and reasons of past sales, as well as expectations about future sales activity.

Types of business models

The Group's business models fall into three categories, which are indicative of the key strategies used to generate returns.

The hold-to-collect (HTC) business model has the objective to hold the financial assets in order to collect contractual cash flows. Sales within this model are monitored and may be performed for reasons which are not inconsistent with this business model. More specifically, sales of financial assets due to credit deterioration, as well as, sales close to the maturity are considered consistent with the objective of hold-to-collect contractual cash flows regardless of value and frequency. Sales for other reasons may be consistent with the HTC model such as liquidity needs in any stress case scenario orsales made to manage high concentration level of credit risk. Such sales are monitored and assessed depending on frequency and value to conclude whether they are consistent with the HTC model. Debt instruments classified within this business model include bonds, due from banks and loans and advances to customers including securitized notes issued by special purpose vehicles established by the Group and recognized in its balance sheet, which are measured at amortized cost, subject to meeting the SPPI assessment criteria.

The hold-to-collect-and-sell business model (HTC&S) has the objective both to collect contractual cash flows and sell the assets. Activities such as liquidity management, interest yield and duration are consistent with this business model, while sales of assets are integral to achieving the objectives of this business model. Debt instruments classified within this business model include investment securities which are measured at FVOCI, subject to meeting the SPPI assessment criteria.

Other business models include financial assets which are managed and evaluated on a fair value basis as well as portfolios that are held for trading. This is a residual category for financial assets not meeting the criteria of the business models of HTC or HTC&S, while the collection of contractual cash flows may be incidental to achieving the business models' objective.

The Group's business models are reassessed at least annually or earlier, if there is a sales' assessment trigger or if there are any changes in the Bank's strategy and main activities, as evidenced by the Bank's business plan, budget and NPE strategy.

Cash flow characteristics assessment

For a financial instrument to be measured at AC or FVOCI, its contractual terms must give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding.

In assessing whether the contractual cash flows are SPPI, the Group will consider whether the contractual terms of the instrument are consistent with a basic lending arrangement i.e. interest includes only consideration for the time value of money, credit risk, other basic lending risks and a profit margin. On the initial recognition of a financial asset, an assessment is performed of whether the financial asset contains a contractual term that could change the amount or timing of contractual cash flows in a way that it would not be consistent with the above condition. Where the contractual terms introduce exposure to risk or volatility that are inconsistent with a basic lending arrangement, the related financial asset is considered to have failed the SPPI assessment and will be measured at FVTPL.

For the purpose of the SPPI assessment, the Group considers the existence of various features, including among others, contractually linked terms, prepayment terms, deferred interest-free payments, extension and equity conversion options and terms that introduce leverage including index linked payments. Moreover, for the securitized notes issued by special purpose vehicles and held by the Group, the cash flow characteristics of the underlying pool of financial assets as well as the credit risk inherent in each securitization's tranche compared to the credit risk of all of the underlying pool of financial assets, are considered.

In case ofspecial lending arrangementssuch as non-recourse loans, in its assessment of the SPPI criterion, the Group considers various factors such as the nature of the borrower and its business, the pricing of the loans, whether it participates in the economic performance of the underlying asset and the extent to which the collateral represents all or a substantial portion of the borrower's assets. Moreover, for special purpose entities, the Group takes into consideration the borrower's adequacy of loss absorbing capital by assessing jointly the criteria of equity sufficiency, Loan to Value ratio (LTV), the Average Debt Service Coverage ratio (ADSCR) as well as the existence of corporate and personal guarantees.

In certain cases when the time value of money element is modified in that the financial asset's interest rate is periodically reset but the reset frequency does not match the tenor of the interest rate or when a financial asset's interest rate is periodically reset to an average of particularshort-term and long-term interest rates, a quantitative assessment is performed (the "Benchmark Test") in order to determine whether the contractual cash flows are SPPI.

In particular, the Group assesses the contractual cash flows of the "real instrument", whose interest rate is reset with a frequency that does not match the tenor of the interest rate, and those of the "benchmark instrument", which are identical in all respects except that the tenor of the interest rate matches exactly the interest period. If the undiscounted cash flows of the former are significantly different from the benchmark cash flows due to the modified time value of money element, the financial asset does not meet the SPPI criterion. In its assessment, the Group considers both the effect of the modified time value of money element in each reporting period and cumulatively over the life of the instrument. This is done, as far as the lifetime of the instrument is concerned, by comparing the cumulative projected undiscounted cash flows of the real and the benchmark instrument, and for each quarterly reporting period, by comparing the projected undiscounted cash flows of the two instruments for that quarterly reporting period, based on predefined thresholds.

In addition, for the purposes of the SPPI assessment, if a contractual feature could have an effect that is de-minimis on the contractual cash flows of the financial asset, it does not affect its classification. Moreover, a contractual feature is considered as not genuine by the Group, if it affects the instrument's contractual cash flows only on the occurrence of an event that is extremely rare, highly abnormal and very unlikely to occur. In such a case, it does not affect the instrument's classification.

The Group performs the SPPI assessment for its lending exposures on a product basis for the retail and part of the wholesale portfolio where contracts are of standardized form, whereas for the remaining wholesale portfolio, securitized notes issued by special purpose vehicles established by the Group and debt securities the assessment is performed on an individual basis.

Derecognition of financial assets

The Group derecognizes a financial asset when its contractual cash flows expire, or the rights to receive those cash flows are transferred in an outright sale in which substantially all risks and rewards of ownership have been transferred. In addition, a financial asset is derecognized even if rights to receive cash flows are retained but at the same time the Group assumes an obligation to pay the received cash flows without a material delay (pass through agreement) or when substantially all the risks and rewards are neither transferred nor retained but the Group has transferred control of the asset. Control is transferred if, and only if, the transferee has the practical ability to sell the asset in its entirety to unrelated third party and is able to exercise that ability unilaterally and without imposing additional restrictions on the transfer.

The main transactions that are subject to the above de-recognition rules are securitization transactions, repurchase agreements and stock lending transactions. In the case of securitization transactions, in order to assess the application of the above mentioned derecognition principles, the Group considers the structure of each securitization transaction including its exposure to the more subordinated tranches of the notes issued and/or credit enhancements provided to the special purposes vehicles, as well as the securitization's contractual terms that may indicate that the Group retains control of the underlying assets. In the case of repurchase transactions and stock lending, the assets transferred are not derecognised since the terms of the transaction entail the retention of all their risks and rewards.

On derecognition of a financial asset, the difference between the carrying amount of the asset and the sum of (i) the consideration received (including any new asset obtained less any new liability assumed) and (ii) any cumulative gain or loss that had been recognized in OCI for financial assets at FVOCI, is recognized in income statement, except for cumulative gains or losses of FVOCI equity instruments which are not reclassified from OCI to income statement at the date of derecognition.

Modification of financial assets that may result in derecognition

In addition, derecognition of financial asset arises when its contractual cash flows are modified and the modification is considered substantial enough so that the original asset is derecognized and a new one is recognised. The Group records the modified asset as a 'new' financial asset at fair value and the difference with the carrying amount of the existing one is recorded in the income statement as derecognition gain or loss.

The Group may modify the contractual terms of a lending exposure either as a concession granted to a client facing or that is about to face financial difficulties or due to other commercial reasons such as changes in market conditions, competition or customer retention.

Modifications that may result in derecognition include:

change in borrower,
change in the currency that the lending exposure is denominated,
debt consolidation features where two or more consumer unsecured lending contracts are consolidated into a single new secured lending agreement,
the removal or addition of conversion features and/or profit sharing mechanisms and similar terms which are relevant to the SPPI assessment;

In addition, the Group may occasionally enter, in the context of loans' modifications, into debt-for-equity transactions. These are transactions where the terms of a lending exposure are renegotiated and as a result, the borrower issues equity instruments (voting or no voting) in order to extinguish part or all of its financial liability to the Group. Such transactions may include also exercise of conversion rights embedded into convertible or exchangeable bonds and enforcement of shares held as collateral.

In debt-for-equity transactions, the modified loan is derecognized while the equity instruments received in exchange are recognized at their fair value, with any resulting gain or loss recognized in the Group's income statement.

2.2.10 Reclassifications of financial assets

The Group reclassifies a financial asset only when it changes its business model for managing financial assets. Generally, a change in the business model is expected to be rare and occurs when the Group either begins or ceases to perform an activity that is significant to its operations; for example, when a business line is acquired, disposed of or terminated. In the rare event when there is a change to the existing business models, the updated assessment is approved by the Group's competent Committees and the amendment is reflected appropriately in the Group's budget and business plan.

Changes in intention related to particular financial assets (even in circumstances of significant changes in market conditions), the temporary disappearance of a particular market for financial assets or a transfer of financial assets between parts of the Group with different business models, are not considered by the Group changes in business model.

The reclassification is applied prospectively from the reclassification date, therefore previously recognized gains, losses (including impairment losses) or interest are not restated.

2.2.11 Financial liabilities

Financial liabilities - Classification and measurement

The Group classifies its financial liabilities in the following categories: financial liabilities measured at amortized cost and financial liabilities measured at fair-value-through-profit-or-loss.

Financial liabilities at fair-value-through-profit-or-loss comprise two sub categories: financial liabilities held for trading and financial liabilities designated at fair-value-through-profit-or-loss upon initial recognition.

Financial liabilities held for trading are those liabilities that the Group incurs principally for the purpose of repurchasing in the near term for short term profit.

The Group may, at initial recognition, irrevocably designate financial liabilities at fair-value-through-profit-or-loss when one of the following criteria is met:

the designation eliminates or significantly reduces an accounting mismatch which would otherwise arise from measuring assets or liabilities or recognising the gains and losses on them on different bases; or
a group of financial liabilities or financial assets and financial liabilities is managed and its performance is evaluated on a fair value basis in accordance with a documented risk management or investment strategy; or
the financial liability contains one or more embedded derivatives as components of a hybrid contract which significantly modify the cash flows that otherwise would be required by the contract.

Financial liabilities designated at FVTPL are initially recognized at fair value. Changes in fair value are recognized in the income statement, except for changes in fair value attributable to changes in the Group's own credit risk, which are recognised in OCI and are not subsequently reclassified to the income statement upon derecognition of the liabilities. However, if such treatment creates or enlarges an accounting mismatch in the income statement, all gains or losses of this financial liability, including the effects of changes in the credit risk, are recognized in the income statement.

Derecognition of financial liabilities

A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires. When an existing financial liability of the Group is replaced by another from the same counterparty on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as an extinguishment of the original liability and the recognition of a new liability and any difference arising is recognized in the income statement.

The Group considers the terms to be substantially different, if the discounted present value of the cash flows under the new terms, including any fees paid net of any fees received and discounted using the original effective interest rate, is at least 10% different from the discounted present value of the remaining cash flows of the original financial liability.

If an exchange of debt instruments or modification of terms is accounted for as an extinguishment, any costs or fees incurred are recognized as part of the gain orloss on the extinguishment. If the exchange or modification is not accounted for as an extinguishment, any costs or fees incurred adjust the carrying amount of the liability and are amortized over the remaining term of the modified liability.

Similarly, when the Group repurchases any debt instruments issued by the Group, it accounts for such transactions as an extinguishment of debt.

2.2.12 Fair value measurement of financial instruments

Fair value of financial instruments is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions in the principal or, in its absence, the most advantageous market to which the Group has access at that date. The fair value of a liability reflects its non-performance risk.

When available, the Group measures the fair value of an instrument using the quoted price in an active market for that instrument. A market is regarded as active if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. If there is no quoted price in an active market, then the Group uses other valuation

techniques that maximize the use of relevant observable inputs and minimize the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction.

The Group has elected to use mid-market pricing as a practical expedient for fair value measurements within a bid-ask spread.

The best evidence of the fair value of a financial instrument at initial recognition is normally the transaction price, i.e. the fair value of the consideration given orreceived unlessthe Group determinesthat the fair value at initial recognition differsfrom the transaction price. In this case, if the fair value is evidenced by a quoted price in an active market for an identical asset or liability (i.e. Level 1 input) or based on a valuation technique that uses only data from observable markets, a day one gain or loss is recognized in the income statement. On the other hand, if the fair value is evidenced by a valuation technique that uses unobservable inputs, the financial instrument is initially measured at fair value, adjusted to defer the difference between the fair value at initial recognition and the transaction price (day one gain or loss). Subsequently the deferred gain or loss is amortized on an appropriate basis over the life of the instrument or released earlier if a quoted price in an active market or observable market data become available or the financial instrument is closed out.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy based on the lowest level input that is significant to the fair value measurement as a whole (note 5.3).

For assets and liabilities that are measured at fair value on a recurring basis, the Group recognizes transfers into and out of the fair value hierarchy levels at the beginning of the quarter in which a financial instrument's transfer was effected.

2.2.13 Impairment of financial assets

The Group recognizes allowance for expected credit losses (ECL) that reflect changes in credit quality since initial recognition to financial assets that are measured at AC and FVOCI, including loans, securitized notes issued by special purpose vehicles established by the Group, lease receivables, debt securities, financial guarantee contracts, and loan commitments. No ECL are recognized on equity investments. ECL are a probability-weighted average estimate of credit losses that reflects the time value of money. Upon initial recognition of the financial instruments in scope of the impairment policy, the Group records a loss allowance equal to 12 month ECL, being the ECL that result from default events that are possible within the next twelve months. Subsequently, for those financial instruments that have experienced a significant increase in credit risk (SICR) since initial recognition, a loss allowance equal to lifetime ECL is recognized, arising from default events that are possible over the expected life of the instrument. If upon initial recognition, the financial asset meets the definition of purchased or originated credit impaired (POCI), the loss allowance is based on the change in the ECL over the life of the asset.

Loss allowances for trade receivables are always measured at an amount equal to lifetime ECL. For all other financial assets subject to impairment, the general three-stage approach applies.

Accordingly, ECL are recognized using a three-stage approach based on the extent of credit deterioration since origination:

Stage 1 When there is no significant increase in credit risk since initial recognition of a financial instrument, an amount equal to 12-months ECL is recorded. The 12 – month ECL represent a portion of lifetime losses, that result from default events that are possible within the next 12 months after the reporting date and is equal to the expected cash shortfalls over the life of the instrument or group of instruments, due to loss events probable within the next 12 months. Not credit-impaired financial assets that are either newly originated or purchased, as well as, assets recognized following a substantial modification accounted for as a derecognition, are classified initially in Stage 1.
Stage 2 When a financial instrument experiences a SICR subsequent to origination but is not considered to be in default, it is included in Stage 2. Lifetime ECL represent the expected credit losses that result from all possible default events over the expected life of the financial instrument.
Stage 3 Financial instruments that are considered to be in default are included in this stage. Similar to Stage 2, the allowance for credit losses captures the lifetime expected credit losses.
POCI Purchased or originated credit impaired (POCI) assets are financial assets that are credit impaired on initial recognition. They are not subject to stage allocation and are always measured on the basis of lifetime expected credit losses. Accordingly, ECL are only recognized to the extent that there is a subsequent change in the assets' lifetime expected credit losses. Any subsequent favorable change to their expected cash flows is recognized as impairment gain in the income statement even if the resulting expected cash flows exceed the estimated cash flows at initial recognition. Apart from purchased assets, POCI assets

may also include financial instruments that are considered new assets, following a substantial modification accounted for as a derecognition (see section 2.2.9).

Definition of default

To determine the risk of default, the Group applies a default definition for accounting purposes, which is consistent with the European Banking Authority (EBA) definition for non-performing exposure (refer to note 5.2.1.2). The accounting definition of default is consistent with the one used for internal credit risk management purposes.

A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that exposure have occurred:

The borrower faces a significant difficulty in meeting his financial obligations.
There has been a breach of contract, such as a default or past due event.
The Group, for economic or contractual reasons relating to the borrower's financial difficulty, has granted to the borrower a concession(s) that the Group would not otherwise consider.
There is a probability that the borrower will enter bankruptcy or other financial re-organization.
For POCI financial assets, a purchase or origination at a deep discount that reflects incurred credit losses is considered a detrimental event. The Group assesses the deep discount criterion following a principle -based approach with the aim to incorporate all reasonable and supportable information which reflects market conditionsthat exist at the time of the assessment.

For debt securities, the Group determines the risk of default using an internal credit rating scale. The Group considers debt securities as credit impaired if the internal rating of the issuer/counterparty corresponds to a rating equivalent to "C" (Moody's rating scale) or the external rating of the issuer/counterparty at the reporting date is equivalent to "C" (Moody's rating scale) and the internal rating is not available.

Significant increase in credit risk (SICR) and staging allocation

Determining whether a loss allowance should be based on 12-month expected credit losses or lifetime expected credit losses depends on whether there has been a significant increase in credit risk (SICR) of the financial assets, issued loan commitments and financial guarantee contracts, since initial recognition.

At each reporting date, the Group performs an assessment as to whether the risk of a default occurring over the remaining expected lifetime of the exposure has increased significantly from the expected risk of a default estimated at origination for that point in time.

The assessment for SICR is performed using both qualitative and quantitative criteria based on reasonable and supportable information that is available without undue cost or effort including forward looking information and macroeconomic scenarios as well as historical experience. Furthermore, regardless of the outcome of the SICR assessment based on the above indicators, the credit risk of a financial asset is deemed to have increased significantly when contractual payments are more than 30 days past due.

As a primary criterion for SICR assessment, the Group compares the residual lifetime probability of default (PD) at each reporting date to the residual lifetime PD for the same point in time which was expected at the origination.

The Group may also consider as a SICR indicator when the residual lifetime PD at each reporting date exceeds certain predetermined values. The criterion may be applied in order to capture cases where the relative PD comparison does not result to the identification of SICR although the absolute value of PD is at levels which are considered high based on the Group's risk appetite framework.

For a financial asset's risk, a threshold may be applied, normally reflected through the asset's forecasted PD, below which it is considered that no significant increase in credit risk compared to the asset's expected PD at origination date has taken place. In such a case the asset is classified at Stage 1 irrespectively of whether other criteria would trigger its classification at Stage 2. This criterion primarily applies to debt securities.

Internal credit risk rating (on a borrower basis) is also used as a basis for the identification of SICR with regards to lending exposures of the Wholesale portfolio. Specifically, the Group takes into consideration the changes of internal ratings by a certain number of notches. In addition, a watchlist status is also considered by the Group as a trigger for SICR identification. Internal credit risk ratings models include borrower specific information as well as, forward-looking information including macroeconomic variables.

Assessment of SICR for debt securities is performed on an individual basis based on the number of notches downgrade in the internal credit rating scale since the origination date.

Forbearance measures as monitored by the Group are considered as a SICR indicator and thus the exposures are allocated into Stage 2 upon forbearance, unless they are considered credit-impaired in which case they are classified as stage 3. Furthermore, regardless of the outcome of the SICR assessment based on the above indicators, the credit risk of a financial asset is deemed to have increased significantly when contractual payments are more than 30 days past due.

Furthermore, Management may apply temporary collective adjustments when determining whether credit risk has increased significantly since initial recognition on exposures that share the same credit risk characteristics to reflect macro-economic or other factors which are not adequately addressed by the current credit risk models. These factors may depend on information such as the type of the exposure, counterparty's specific information and the characteristics of the financial instrument, while their application requires the application of significant judgment.

Transfers from Stage 2 to Stage 1

A financial asset, which is classified to Stage 2 due to Significant Increase in Credit Risk (SICR), is reclassified to Stage 1, as long as it does not meet anymore any of the Stage 2 Criteria.

Where forbearance measures have been applied, the Group uses a probation period of two years, in order to fulfill the requirements for a transfer back to Stage 1. If at the end of that period the borrowers have made regular payments of a significant aggregate amount, there are no past due amounts over 30 days and the loans are neither credit impaired, nor any other SICR criteria are met, they exit forborne status and are classified as stage 1.

Transfers from Stage 3 to Stage 2

A financial asset is transferred from Stage 3 to Stage 2, when the criteria based on which the financial asset was characterized as credit impaired, are no longer valid.

Criteria for grouping of exposures based on shared credit risk characteristics

The assessment of loss allowance is performed either on an individual basis or on a collective basis for groups of similar items with homogeneous credit risk characteristics. The Group applies the same principles for assessing SICR since initial recognition when estimating ECL on a collective or on an individual basis.

The Group segments its lending exposures on the basis of shared credit risk characteristics for the purposes of both assessing significant increase in credit risk and measuring loan loss allowance on a collective basis. The different segments aim to capture differences in PDs and in the rates of recovery in the event of default.

The shared credit risk characteristics used for the segmentation of exposures include several elements such as: instrument type, portfolio type, asset class, product type, industry, originating entity, credit risk rating, remaining term to maturity, geographical location of the borrower, value of collateral to the financial asset, forbearance status and days in arrears.

The Group identifies individually significant exposures and performs the ECL measurement based on borrower specific information for both retail and wholesale portfolios. This measurement is performed at a borrower level, hence the criteria are defined at this level, while both qualitative and quantitative factors are taken into consideration including forward looking information.

For the remaining retail and wholesale exposures, ECL are measured on a collective basis. This incorporates borrower specific information, collective historical experience of losses and forward-looking information. For debt securities and securitized notes issued by special purpose entities established by the Group, the measurement of impairment losses is performed on an individual basis.

Measurement of Expected Credit Losses

The measurement of ECL is an unbiased probability-weighted average estimate of credit losses that reflects the time value of money, determined by evaluating a range of possible outcomes. A credit loss is the difference between the cash flows that are due to the Group in accordance with the contractual terms of the instrument and the cash flows that the Group expects to receive (i.e. cash shortfalls) discounted at the original effective interest rate (EIR) of the same instrument, or the credit-adjusted EIR in case of purchased or originated credit impaired assets (POCI). In measuring ECL, information about past events, current conditions and reasonable and supportable forecasts of future conditions are considered. For undrawn commitments, ECL are calculated as the present value of the difference between the contractual cash flows due if the commitment was drawn and the cash flows expected

to be received, while for financial guarantees ECL are measured as the expected payments to reimburse the holder less any amounts that the Group expects to receive.

The Group estimates expected cash shortfalls, which reflect the cash flows expected from all possible sources, including collateral, guarantees and other credit enhancements that are part of the contractual terms and are not recognized separately. In case of a collateralized financial instrument, the estimated expected cash flows related to the collateral reflect the amount and timing of cash flows that are expected from liquidation less the discounted costs of obtaining and selling the collateral, irrespective of whether liquidation is probable.

ECL are calculated over the maximum contractual period over which the Group is exposed to credit risk, which is determined based on the substantive terms of the instrument, or in case of revolving credit facilities, by taking into consideration factors such as the Group's expected credit risk management actions to mitigate credit risk and past practice.

Receivables from customers arising from the Group's activities other than lending, are presented under Other Assets and are typically short term. Therefore, considering that usually there is no significant financing component, the loss allowance forsuch financial assets is measured at an amount equal to the lifetime expected credit losses under the simplified approach.

ECL Key Inputs

The ECL calculations are based on the term structures of the probability of default (PD), the loss given default (LGD), the exposure at default (EAD) and other input parameters such as the credit conversion factor (CCF) and the prepayment rate. Generally, the Group derives these parameters from internally developed statistical models and observed point-in-time and historical data, leveraging the existing infrastructure development for the regulatory framework and risk management practices.

The PD, LGD and EAD used for accounting purposes may differ from those used for regulatory purposes. For the purposes of impairment measurement, PD is a point-in-time estimate whereas for regulatory purposes PD is a 'through-the-cycle' estimate. In addition, LGD and EAD for regulatory purposes are based on loss severity experienced during economic downturn conditions, while for impairment purposes, LGD and EAD reflect an unbiased and probability-weighted amount.

The PD represents the likelihood of default assessed on the prevailing economic conditions at the reporting date, adjusted to take into account estimates of future economic conditions that are likely to impact the risk of default, over a given time horizon.

The Group uses Point in Time (PiT) PDs in order to remove any bias towards historical data thus aiming to reflect management's view of the future as at the reporting date, incorporating relevant forward looking information including macroeconomic scenarios.

Two types of PD are used for calculating ECL:

12-month PD, which is the estimated probability of default occurring within the next 12 months (or over the remaining life of the financial asset if this is less than 12 months). It is used to calculate 12-month ECL for Stage 1 exposures.
Lifetime PD, which is the estimated probability of a default occurring over the remaining life of the financial asset. It is used to calculate lifetime ECL for Stage 2, Stage 3 and POCI exposures.

For debt securities, PDs are obtained by an international rating agency using risk methodologies that maximize the use of objective non-judgmental variables and market data. The Group assignsinternal credit ratings to each issuer/counterparty based on these PDs. In case of counterparties for which no information is available, the Group assigns PDs which are derived from internal models.

The Exposure at default (EAD) is an estimate of the exposure at a future default date, taking into account expected changes in the exposure after the reporting date, including repayments of principal and interest and expected drawdowns on committed facilities. The EAD includes both on and off balance sheet exposures. The on balance sheet exposure corresponds to the total amount that has been withdrawn and is due to be paid, which includes the outstanding principal, accrued interest and any past due amounts. The off balance sheet exposure represents the credit that is available to be withdrawn, in excess of the on balance sheet exposure.

Furthermore, the CCF factor is used to convert the amount of a credit facility and other off-balance sheet amounts to an EAD amount. It is a modelled assumption which represents a proportion of any undrawn exposure that is expected to be drawn prior to a default event occurring.

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In addition, the prepayment rate is an estimate of early prepayments on loan exposure in excess of the contractual repayment according to the repayment schedule and is expressed as a percentage applied to the EAD at each period, reducing the latter amount accordingly.

LGD represents the Group's expectation of the extent of loss on a defaulted exposure and it is the difference between the contractual cash flows due and those that the Group expects to receive including any amounts from collateral liquidation. LGD varies by type of counterparty, type and seniority of claim, availability of collateral or other credit support, and is usually expressed as a percentage of EAD. The Group distinguishes its loan portfolios into two broad categories i.e. secured and unsecured. The Group estimates the LGD component using cure rates that reflect cash recoveries, estimated proceeds from collateral liquidation, estimates for timing realization, realization costs, etc. Where the LGD's component values are dependent on macro – economic data, such types of dependencies are reflected by incorporating forward looking information, such asforecasted price indicesinto the respective models. The estimation of the aforementioned component values within LGD reflects available historical data which cover a reasonable period, i.e. a full economic cycle.

For debt securities, the LGD is typically based on historical data derived mainly from rating agencies' studies but may also be determined considering the existing and expected liabilities structure of the obligor and macroeconomic environment.

Furthermore, the seniority of the debt security, any potential collaterals by the obligor or any other type of coverage is taken into account for the calculation.

Forward-looking information

The measurement of expected credit losses for each stage and the assessment of significant increases in credit risk consider information about reasonable and supportable forecasts of future events and macroeconomic conditions. The estimation and application of forward-looking information requires significant judgment.

The Group uses, at a minimum, three macroeconomic scenarios (i.e. base, adverse and optimistic) to achieve the objective of measuring ECL in a way that reflects an unbiased and probability weighted outcome. The baseline scenario represents the most likely scenario and is aligned with the information used by the Group for strategic planning and budgeting purposes.

The scenarios are reflected in the risk parameters, and, namely 12-month PD, Lifetime PD and LGD, hence 3 sets of each of these parameters are used, in line with the scenarios developed.

The Group then proceeds to the calculation of weights for each scenario, which represent the probability of occurrence for each of these scenarios. These weights are applied on the 3 sets of calculations of the parameters in order to produce a single scenario weighted risk parameter value which is subsequently used in both SICR assessment and ECL measurement. ECL calculation incorporates forward-looking macroeconomic variables, including GDP growth rates, house price indices, unemployment rates, interest rates, etc. In order to capture material non – linearities in the ECL model, in the case of individually significant exposures, the Group considers the relevance of forward looking information to each specific group of borrowers primarily on the basis of the business sector they belong and other drivers of credit risk (if any). As such, different scenario weights are determined per groups of borrowers with the objective of achieving an unbiased ECL amount which incorporates all relevant and supportable information.

Modified Financial Assets

In cases where the contractual cash flows of a financial asset have been modified and the modification is considered substantial enough (for the triggers of derecognition, refer to Derecognition of Financial assets in section 2.2.9 above), the modification date is considered to be the date of initial recognition for impairment calculation purposes, including for the purposes of determining whether a significant increase in credit risk has occurred. Such a modified asset is typically classified as Stage 1 for ECL measurement purposes. However, in some circumstances following a modification that results in derecognition of the original financial asset, there may be evidence that the new financial asset is credit-impaired at initial recognition, and thus, the financial asset is recognized as an originated credit-impaired financial asset (POCI).

In cases where the contractual cash flows of a financial asset have been modified and the modification is not considered substantial enough, the Group recalculates the gross carrying amount of the financial asset and recognizes the difference as a modification gain or loss in the income statement and determines if the financial asset's credit risk has increased significantly since initial recognition by comparing the risk of a default occurring at initial recognition based on the original unmodified contractual terms and the risk of a default occurring at the reporting date, based on the modified contractual terms.

Presentation of impairment allowance

For financial assets measured at amortized cost, impairment allowance is recognized as a loss allowance reducing the gross carrying amount of the financial assets in the balance sheet. For debt instruments measured at FVOCI, impairment allowance is recognized in other comprehensive income and does not reduce the carrying amount of the debt instruments in the balance sheet. For off-balance sheet financial items arising from lending activities, impairment allowance is presented in Other Liabilities. The respective ECL for the above financial items is recognised within impairment losses.

Write-off of financial assets

Where the Group has no reasonable expectations of recovering a financial asset either in its entirety or a portion of it, the gross carrying amount of that instrument is reduced directly, partially or in full, against the impairment allowance. The amount written-off is considered as derecognized. Subsequent recoveries of amounts previously written off decrease the amount of the impairment losses in the income statement.

Financial assets that are written off could still be subject to enforcement activities in order to comply with the Group's procedures for recovery of amounts due.

2.2.14 Sale and repurchase agreements and securities lending

(i) Sale and repurchase agreements

Securities sold subject to repurchase agreements (repos) continue to be recorded in the Group's Balance Sheet as the Group retains substantially all risks and rewards of ownership, while the counterparty liability is included in amounts due to other banks or due to customers, as appropriate. Securities purchased under agreements to resell (reverse repos) are recorded as loans and advances to other banks or customers, as appropriate. The difference between the sale and repurchase price in case of repos and the purchase and resale price in case of reverse repos is recognized as interest and accrued over the period of the repo or reverse repo agreements using the effective interest method.

(ii) Securities lending

Securities lent to counterparties are retained in the financial statements. Securities borrowed are not recognized in the financial statements, unless these are sold to third parties, in which case the obligation to return them is recorded at fair value as a trading liability.

2.2.15 Leases

(i) Accounting for leases as lessee

When the Group becomes the lessee in a lease arrangement, it recognizes a lease liability and a corresponding right-of-use (RoU) asset at the commencement of the lease term when the Group acquires control of the physical use of the asset.

Lease liabilities are presented within Other liabilities and RoU assets within Property and equipment and investment property. Lease liabilities are measured based on the present value of the future lease payments over the lease term, discounted using an incremental borrowing rate. The interest expense on lease liabilities is presented within net interest income.

The lease liability is remeasured when there is a change in future lease payments arising from a change in an index or rate, a change in the Group's estimate of the amount expected to be payable under a residual value guarantee or if the Group changesits assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The RoU asset is initially recorded at an amount equal to the lease liability and is adjusted for rent prepayments, initial direct costs, or lease incentives received. Subsequently, the RoU asset is depreciated over the shorter of the lease term or the useful life of the underlying asset, with the depreciation presented within operating expenses.

When a lease contains extension or termination options that the Group considers reasonably certain to be exercised, the expected future lease payments or costs of early termination are included within the lease payments used to calculate the lease liability.

As described in note 2.1.1, with respect to the rent concessions that are a direct consequence of the COVID-19 pandemic, the Group has applied COVID-19-Related Rent Concessions - Amendment to IFRS 16, which provides a practical expedient allowing the Group not to assess whether eligible rent concessions are lease modifications.

(ii) Accounting for leases as lessor

At inception date of the lease, the Group, acting as a lessor, classifies each of its leases as either an operating lease or a finance lease based on certain criteria.

Finance leases

At commencement date, the Group derecognizes the carrying amount of the underlying assets held under finance lease, recognizes a receivable at an amount equal to the net investment in the lease and recognizes, in income statement, any profit or loss from the derecognition of the asset and the recognition of the net investment. The net investment in the lease is calculated as the present value of the future lease payments in the same way as for the lessee.

After commencement date, the Group recognizes finance income over the lease term, based on a pattern reflecting a constant periodic rate of return on the lessor's net investment in the lease. The Group also recognizes income from variable payments that are not included in the net investment in the lease. After lease commencement, the net investment in a lease is not remeasured unless the lease is modified or the lease term is revised.

Operating leases

The Group continues to recognize the underlying asset and does not recognize a net investment in the lease on the balance sheet or initial profit (if any) on the income statement.

The Group recognizes lease payments from the lessees as income on a straight-line basis or another systematic basis considered as appropriate. Also it recognizes costs, including depreciation, incurred in earning the lease income as an expense. The Group adds initial direct costs incurred in obtaining an operating lease to the carrying amount of the underlying asset and recognizes those costs as an expense over the lease term on the same basis as the lease income.

Subleases

The Group, acting as a lessee, may enter into arrangements to sublease a leased asset to a third party while the original lease contract is in effect. The Group acts as both the lessee and lessor of the same underlying asset. The sublease is a separate lease agreement, in which the intermediate lessor classifies the sublease as a finance lease or an operating lease as follows:

if the head lease is a short-term lease, the sublease is classified as an operating lease; or
otherwise, the sublease is classified by reference to the right-of-use asset arising from the head lease, rather than by reference to the underlying asset.

2.2.16 Income tax

Income tax consists of current and deferred tax.

(i) Current income tax

Income tax payable on profits, based on the applicable tax law in each jurisdiction, is recognized as an expense in the period in which profits arise.

(ii) Deferred tax

Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date. The principal temporary differences arise from impairment/valuation relating to loans, Private Sector Initiative (PSI+) tax related losses, losses from disposals and crystallized writeoffs of loans, depreciation of property and equipment, fair value adjustment of investment property, pension and other retirement benefit obligations, and revaluation of certain financial assets and liabilities, including derivative financial instruments.

that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Any such reduction is reversed to the extent that it becomes probable that sufficient taxable profit will be available. The Group recognises a previously unrecognised deferred tax asset to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred tax related to investment securities at FVOCI and cash flow hedges is recognized to other comprehensive income, and is subsequently recognized in the income statement together with the deferred gain or loss.

The deferred tax asset on income tax losses carried forward is recognized as an asset when it is probable that future taxable profits will be available against which these losses can be utilized.

(iii) Uncertain tax positions

The Group determines and assesses all material tax positions taken, including all, if any, significant uncertain positions, in all tax years that are still subject to assessment (or when the litigation is in progress) by relevant tax authorities. In evaluating tax positions in various states, local, and foreign jurisdictions, the Group examines all supporting evidence (Ministry of Finance circulars, individual rulings, case law, past administrative practices, ad hoc tax/legal opinions etc.) to the extent they are applicable to the facts and circumstances of the particular Group's case/ transaction.

In addition, judgments concerning the recognition of a provision against the possibility of losing some of the tax positions are highly dependent on advice received from internal/ external legal counselors. For uncertain tax positions with a high level of uncertainty, the Group recognizes, on a transaction by transaction basis, or together as a group, depending on which approach better predicts the resolution of the uncertainty using an expected value (probability-weighted average) approach: (a) a provision against tax receivable which has been booked for the amount of income tax already paid but further pursued in courts or (b) a liability for the amount which is expected to be paid to the tax authorities. The Group presents in its balance sheet all uncertain tax balances as current or deferred tax assets or liabilities.

The Group as a general rule has opted to obtain for the Group's Greek companies an 'Annual Tax Certificate', which is issued after a tax audit is performed by the same statutory auditor or audit firm that audits the annual financial statements. Further information in respect of the Annual Tax Certificate and the related tax legislation, as well as the unaudited tax years for the Group's companies is provided in note 13.

2.2.17 Employee benefits

(i) Short term benefits

Short term employee benefits are those expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related services and are expensed as these services are provided.

(ii) Pension obligations

The Group provides a number of defined contribution pension plans where annual contributions are invested and allocated to specific asset categories. Eligible employees are entitled to the overall performance of the investment. The Group's contributions are recognized as employee benefit expense in the year in which they are paid.

(iii) Standard legal staff retirement indemnity obligations (SLSRI) and termination benefits

The Group operates unfunded defined benefit plans in Greece, Bulgaria and Serbia, under broadly similar regulatory frameworks. In accordance with the local labor legislation, the Group provides for staff retirement indemnity obligation for employees which are entitled to a lump sum payment based on the number of years of service and the level of remuneration at the date of retirement, if they remain in the employment of the Group until normal retirement age. Provision has been made for the actuarial value of the lump sum payable on retirement (SLSRI) using the projected unit credit method. Under this method the cost of providing retirement indemnities is charged to the income statement so as to spread the cost over the period of service of the employees, in accordance with the actuarial valuations which are performed every year.

The SLSRI obligation is calculated as the present value of the estimated future cash outflows using interest rates of high quality corporate bonds. In countries where there is no deep market in such bonds, the yields on government bonds are used. The currency and term to maturity of the bonds used are consistent with the currency and estimated term of the retirement benefit obligations. Actuarial gains and lossesthat arise in calculating the Group's SLSRI obligations are recognized directly in other comprehensive income in the period in which they occur and are not reclassified to the income statement in subsequent periods.

Interest on the staff retirement indemnity obligations and service cost, consisting of current service cost, past service cost and gains or losses on settlement are recognized in the income statement. In calculating the SLSRI obligation, the Group also considers potential separations before normal retirement based on the terms of previous voluntary exit schemes.

Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or whenever an employee accepts voluntary redundancy in exchange for these benefits (including those in the context of the Voluntary Exit Schemes implemented by the Group). The Group recognizes termination benefits at the earlier of the following dates: (a) when the Group can no longer withdraw the offer of those benefits; and (b) when the Group recognizes costsfor a restructuring that involves the payment of termination benefits. In the case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer. Termination benefits falling due more than 12 months after the end of the reporting period are discounted to their present value.

(iv) Performance-based cash payments

The Group's Management awards high performing employees with bonuses in cash, from time to time, on a discretionary basis. Cash payments requiring only Management approval are recognized as employee benefit expenses on an accrual basis. Cash payments requiring General Meeting approval as distribution of profits to staff are recognized as employee benefit expense in the accounting period that they are approved by the Group's shareholders.

(v) Performance-based share-based payments

The Group's Management awards employees with bonuses in the form of shares and share options on a discretionary basis. Nonperformance related shares vest in the period granted. Share based payments that are contingent upon the achievement of a performance and service condition, vest only if both conditions are satisfied.

The fair value of the shares granted is recognized as an employee benefit expense with a corresponding increase in share capital (par value) and share premium.

The fair value of the options granted is recognized as an employee benefit expense with a corresponding increase in a nondistributable reserve over the vesting period. The proceeds received net of any directly attributable transaction costs are credited to share capital (par value) and share premium when the options are exercised, with a transfer of the non distributable reserve to share premium.

2.2.18 Repossessed properties

Land and buildings repossessed through an auction process to recover impaired loans are, except where otherwise stated, included in 'Other Assets'. Assets acquired from an auction process are held temporarily for liquidation and are valued at the lower of cost and net realizable value, which is the estimated selling price, in the ordinary course of business, less costs necessary to make the sale.

In cases where the Group makes use of repossessed properties as part of its operations, they may be reclassified to own occupied or investment properties, as appropriate.

Any gains or losses on liquidation are included in the income statement.

2.2.19 Related party transactions

Related parties of the Group include:

(a) an entity that has control over the Group and entities controlled, jointly controlled or significantly influenced by this entity, as well as members of its key management personnel and their close family members;

(b) an entity that has significant influence over the Group and entities controlled by this entity,

(c) members of key management personnel of the Group, their close family members and entities controlled or jointly controlled by the abovementioned persons;

(d) associates and joint ventures of the Group; and

(e) fellow subsidiaries.

Transactions of similar nature are disclosed on an aggregate basis. All banking transactions entered into with related parties are in the normal course of business and are conducted on an arm's length basis.

2.2.20 Provisions

Provisions are recognized when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and reliable estimates of the amount of the obligation can be made.

The amount recognized as a provision is the best estimate of the expenditure required to settle the present obligation at each reporting date, taking into account the risks and uncertainties surrounding the amount of such expenditure.

Provisions are reviewed at each reporting date and adjusted to reflect the current best estimate. If, subsequently, it is no longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provision isreversed.

2.2.21 Operating segment

An operating segment is a component of the Group that engages in business activities from which it may earn revenue and incur expenses within a particular economic environment. Operating segments are identified on the basis of internal reports, regarding operating results, of components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance. The chief operating decision maker has been identified as the Strategic Planning Committee that isresponsible forstrategic decision making. Segmentrevenue,segment expenses and segment performance include transfers between business segments. Such transfers are accounted for at competitive prices in line with charges to unaffiliated customers for similar services.

2.2.22 Share capital

Ordinary shares and preference shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction from the proceeds, net of tax.

Dividend distribution on shares is recognized as a deduction in the Group's equity when approved by the General Meeting of shareholders. Interim dividends are recognized as a deduction in the Group's equity when approved by the Board of Directors.

Where any Group entity purchases the Company's equity share capital (treasury shares), the consideration paid including any directly attributable incremental costs (net of income taxes), is deducted from shareholders' equity until the shares are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received is included in shareholders' equity.

2.2.23 Preferred securities

Preferred securities issued by the Group are classified as equity when there is no contractual obligation to deliver to the holder cash or another financial asset.

Incremental costs directly attributable to the issue of new preferred securities are shown in equity as a deduction from the proceeds, net of tax.

Dividend distribution on preferred securities is recognized as a deduction in the Group's equity on the date it is due.

Where preferred securities, issued by the Group, are repurchased, the consideration paid including any directly attributable incremental costs(net of income taxes), is deducted from shareholders' equity. Where such securities are subsequently called orsold, any consideration received is included in shareholders' equity.

2.2.24 Financial guarantees and commitments to extend credit

Financial guarantees

Financial guarantee contracts are contracts that require the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor failsto make payments when due, in accordance with the terms of a debt instrument. Such financial guarantees are granted to banks, financial institutions and other bodies on behalf of customers to secure loans, overdrafts and other banking facilities.

Financial guarantees are initially recognized at fair value, being the premium received. Subsequent to initial recognition, such guarantees are measured at the higher of the amount of the ECL allowance, and the amount initially recognised less any cumulative amortization of the fee earned, where appropriate.

Commitments to extend credit

Commitments represent off-balance sheet items where the Group commits, over the duration of the agreement, to provide a loan with pre-specified terms to the customer. Such contractual commitments represent commitments to extend credit and standby letters and they are part of the normal lending activities of the Group, for which an ECL allowance is recognised under IFRS 9.

ECL allowance for off-balance sheet exposures (financial guarantees and commitments) is included within Other Liabilities.

2.2.25 Non-current assets classified as held for sale and discontinued operations

Non-current assets are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. For a non- current asset to be classified as held for sale, it is available for immediate sale in its present condition, subject to terms that are usual and customary for sales of such assets, and the sale is considered to be highly probable. In such cases, management is committed to the sale and actively markets the property for sale at a price that is reasonable in relation to the current fair value. The sale is also expected to qualify for recognition as a completed sale within one year from the date of classification. Before their classification as held forsale, assets are remeasured in accordance with the respective accounting standard.

Assets held for sale are subsequently remeasured at the lower of their carrying amount and fair value less cost to sell. Any loss arising from the above measurement is recorded in profit or loss and can be reversed in the future. When the lossrelates to a disposal group, it is allocated to the assets within that disposal group.

The Group presents discontinued operationsin a separate line in the consolidated income statement if a Group entity or a component of a Group entity has been disposed of or is classified as held for sale and:

(a) Represents a separate major line of business or geographical area of operations;

(b) Is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations; or
(c) Is a subsidiary acquired exclusively with a view to resale.

Profit or loss from discontinued operations includes the profit or loss before tax from discontinued operations, the gain or loss on disposal before tax or measurement to fair value less costs to sell and discontinued operations tax expense. Intercompany transactions between continuing and discontinued operations are presented on a gross basis in the income statement. Upon classification of a Group entity as a discontinued operation, the Group restates prior periods in the consolidated income statement.

2.2.26 Cash and cash equivalents

Cash and cash equivalentsinclude cash in hand, unrestricted deposits with central banks, due from credit institutions and othershortterm highly liquid investments with original maturities of three months or less.

2.2.27 Government grants

Government grants are transfers of resources to the Group by a government entity such as government, government agencies and similar bodies whether local, national or international, in return for compliance with certain past of future conditions related to the Group's operating activities.

Government grants are recognized when there is reasonable assurance that the grant will be received and the Group will comply with the conditions attached to it. The grants are recognized in the income statement on a systematic basis to match the way that the Group recognizes the expenses for which the grants are intended to compensate. In case of subsequent changes in the Group's expectations of meeting the conditions attached to the government grants, the effect of such changes is recognised in income statement.

2.2.28 Fiduciary activities

The Group provides custody, trustee, corporate administration, investment management and advisory services to third parties. This involves the Group making allocation, purchase and sale decisions in relation to a wide range of financial instruments. The Group receives fee income for providing these services. Those assets that are held in a fiduciary capacity are not assets of the Group and are not recognized in the financial statements. In addition, the Group does not guarantee these investments and as a result it is not exposed to any credit risk in relation to them.

3. Critical accounting estimates and judgments in applying accounting policies

In the process of applying the Group's accounting policies, the Group's Management makes various judgments, estimates and assumptions that may affect the reported amounts of assets and liabilities, revenues and expenses recognized in the financial statements within the next financial year and the accompanying disclosures. Estimates and judgments are continually evaluated and are based on current conditions, historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are recognized prospectively. The most significant areas in which the Group makes judgments, estimates and assumptions in applying its accounting policies are set out below:

3.1 Impairment losses on loans and advances to customers

Expected Credit Loss (ECL) measurement

The ECL measurement requires Management to apply judgment, in particular, the estimation of the amount and timing of future cash flows and collateral values when determining impairment losses and the assessment of a significant increase in credit risk. These estimates are driven by a number of factors, changes in which can result in significant changes to the timing and amount of allowance for credit loss to be recognized.

The Group's ECL calculations are outputs of complex models with a number of underlying assumptionsregarding the choice of variable inputs and their interdependencies. In addition, temporary adjustments may be required to capture new developments and information available, which are not reflected yet in the ECL calculation through the risk models.

Due to the extraordinary circumstances of the Covid-19 pandemic and although the ECL calculation methodology remained the same compared to 31 December 2019, the Group revised the assumptions and estimates applied, as those specified in the sections below, in order to reflect appropriately, to the extent possible, the negative impact of the pandemic. Accordingly, Management applied the appropriate level of judgement regarding its expectations for the severity and the duration of the economy's negative outlook, in line with the International Accounting Standards Board (IASB), the European Central Bank (ECB) and other banking regulators'statements, which emphasize the need for overlays where the risk models do not capture the specific circumstances.

The elements of the ECL models that are considered significant accounting judgments and estimates include:

Determination of a significant increase of credit risk

IFRS 9 does not include a definition of what constitutes a significant increase in credit risk (SICR). An assessment of whether credit risk has increased significantly since initial recognition is performed at each reporting period by considering primarily the change in the risk of default occurring over the remaining life of the financial instrument. The Group assesses whether a SICR has occurred since initial recognition based on qualitative and quantitative reasonable and supportable forward-looking information that includes significant management judgment. More stringent criteria could significantly increase the number of instruments migrating to stage 2.

In the context of SICR assessment during the Covid-19 pandemic outbreak, the Group took into consideration the disruptive effect of overly pro-cyclical assumptions inherent in the IFRS 9 models that aggravate the ECL results, as well as the fact that the entire lending portfolios are not equally affected by the pandemic. Accordingly, the Group segregated its lending exposures into two subpopulations, depending on whether they were affected by Covid-19 or not, in performing both the SICR assessment and ECL measurement.

Retail lending

For retail lending exposures the primary criterion is the change in the residual cumulative lifetime Probability of Default (PD) above specified thresholds. These thresholds are set and vary per portfolio, modification status (modified/non-modified), product type as well as per origination PD level. In general, thresholds for lower origination PDs are higher than those assessed for higher origination PDs.

As at 31 December 2020 and 31 December 2019, the range of lifetime PD thresholds based on the above segmentation, that triggers allocation to stage 2 for Greece's retail exposures are set out below:

Retail exposures	Range of SICR thresholds
Mortgage	30%-50%
Home Equity	10%-80%
SBB	10%-65%
Consumer	60%-100%

In response to Covid-19 pandemic on the assessment of SICR in the Retail lending portfolio, the Group distinguished between the borrowers that are impacted by Covid-19 pandemic such as those that have applied for the moratoria measures or are eligible for state support measures, based on the official list published by the Greek Ministry of Finance, or operate in those sectors that were highly affected and those that are not affected by the pandemic. The borrowers' participating in the Gefyra I program that involves 9-months installment subsidy by the State were not considered as affected by the Covid-19 pandemic for the purpose of the SICR assessment (note 5.2.1.2 (e)). Following the above mentioned segregation, certain performing, non-forborne Retail lending exposures, out of the non Covid-19 affected population, that would have been transferred to stage 2 due to the impact of the post Covid-19 macroeconomic forward-looking information on the respective lifetime PDs, have been assessed not to have experienced significant difficulties, thus remained in stage 1.

Wholesale lending

For wholesale lending exposures, the origination PD curves and the residual lifetime PD curves at each reporting date are mapped to credit rating bands. Accordingly, SICR thresholds are based on the comparison of the origination and reporting date credit ratings, whereby rating downgrades represent changes in residual lifetime PD. Similar to retail exposures, the Group segments the wholesale lending exposures based on asset class, loan type and credit rating at origination. In addition, for securitized notes issued by special purpose entities established by the Group, the SICR assessment is performed by considering the performance of the underlying assets.

As at 31 December 2020 and 31 December 2019, the credit rating deterioration thresholds as per applicable borrower internal rating scale, that trigger allocation to stage 2 per rating bands for Greece's wholesale lending exposures are set out in the tables below:

Wholesale internal rating bands	SICR threshold range
1-2	Two to Three notches
3-4	Two notches or more
5-8	One notch or more

Due to the expected lag in the issuance of wholesale borrowers' 2020 financial statements, that will reflect the pandemic's impact to the borrower's operations, the Group supplemented its existing methodology for the identification of SICR (based on credit ratings' change described above) by performing an enhanced assessment on a borrower level in order to identify those that have possible long term funding needs or signs of financial distress. The latter was achieved by evaluating information regarding the remediation actions undertaken by the borrower and respective Covid-19 State and Group relief measures as well as by analyzing borrowers' recent performance, other financial risk elements and industry-specific financial outlook, especially for the Larger SMEs and Large Corporates. Through the above process, high and medium risk borrowersin stage 1 that are operating in highly affected by the Covid-19 pandemic industries of the economy or were granted moratoria relief measures were assessed in order to identify those that should be moved to stage 2.

The timely and accurate monitoring of the borrowers under payment moratoria is a prerequisite for the successful implementation of initiatives undertaken to address of Covid-19 pandemic, aiming at mitigating anticipated cliff effect upon their expiration within 2020 and 2021. In line with EBA Guidelines regarding the application of general payment moratoria, the Group continued assessing borrowers in terms of financial difficulty and unlikeliness to pay triggers. To that end, the Group proactively segmented lending portfolios, identifying borrowers and sectors requiring prioritization, such as hospitality and leisure, transportation, automotive and construction companies, in terms of monitoring and active management as well as when estimating the Covid-19 impact on the calculation of ECL, specifically for borrowers from the above mentioned most vulnerable industries in the countries where the Group operates, depending on the anticipated impact of the pandemic.

Furthermore, the regular back-stop SICR criteria in the Group's accounting policy for Retail and Corporate portfolios remain valid in the post Covid-19 era with no exceptions. Accordingly, irrespective of whether the population is considered affected or not following the application of the segregation described above, the backstop Stage 2 classification criteria for lending exposures over 30 days past due (dpd) and forborne classification were applied.

Based on recent banking regulators' and accounting guidance (European Banking Authority (EBA), ECB, IASB) Covid-19 relief measures should neither be treated as forbearance nor automatically trigger a significant increase in credit risk. Such measures are accounted for as modifications, granted for other than forbearance reasons. Further information regarding the Group's lending exposures subject to moratoria and government support measures are provided in note 5.2.1.2(e).

Management continuously monitors the pandemic consequences to all sectors of the economy, in contemplation with the expected remedy effect of the government actions, in order to assess whether there is a significant increase in credit risk.

Determination of scenarios, scenario weights and macroeconomic factors

To achieve the objective of measuring ECL, the Group evaluates a range of possible outcomes in line with the requirements of IFRS 9 through the application of a minimum three macroeconomic scenarios i.e. baseline, adverse and optimistic, in a way that reflects an unbiased and probability weighted outcome. Each of the scenarios is based on management's assumptions around future economic conditions in the form of macroeconomic, market and other factors. As at 31 December 2020 and 31 December 2019, the probability weights for the above mentioned scenarios applied by the Group in the ECL measurement calculations are 50% for the baseline scenario and 25% for the adverse and optimistic scenarios.

The key assumptions underlying in each macroeconomic scenario are provided below:

Baseline scenario

The baseline scenario assumes a double-dip recession in 2020 due to the second lockdown in November 2020 and an expected return to normal conditions by the end of the first half of 2021. This scenario assumes a U-shaped recovery in 2021 and 2022. In the medium term growth decelerates due to the slowdown of cyclical recovery. Structural reforms and the efficient use of the EU recovery funds could lead to an improvement in growth rates in Greece.

Optimistic scenario

Under this scenario, the second lockdown is terminated swiftly, thereby allowing a quicker recovery in 2021. The vaccination process will be completed locally and abroad on time and better absorption of EU funds is expected.

Adverse scenario

The adverse scenario assumes that the second lockdown that started in November 2020 continues or is sporadically re-enacted throughout the following months as a result of problems in the vaccination process domestically and abroad. This results to a slower resumption to positive economic growth in 2021. The prolonged lockdown results also to the destruction of productive capabilities. This scenario considers ineffective use of fiscal stimulus in 2021 and/or inadequate budget funding funds conditional on the continuation of the lockdown, while it expects also further delays in the flows from available EU funds and initiatives.

Forward-looking information

The Group ensures that impairment estimates and macroeconomic forecasts, as provided by Economic Analysis & Financial Markets Research Division, applicable for business and regulatory purposes are fully consistent. Accordingly, the IFRS 9 probability weighted scenario applied in the ECL calculation coincides with the one used for ICAAP, business planning and internal stress testing purposes. In addition, relevant experience gained from the stress tests imposed by the regulator, has been taken into account in the process of developing the macroeconomic scenarios, as well as, impairments for stress testing purposes have been forecasted in line with IFRS 9 ECL methodology.

In terms of macroeconomic assumptions, the Group assesses a number of indicators in projecting the risk parameters, namely Residential and Commercial Property Price Indices, unemployment, Gross Domestic Product (GDP), Greek Government Bond (GGB) spread over Euribor and inflation as well as Interest and FX rates.

As at 31 December 2020, in order to respond to the unprecedented circumstances of the Covid-19 crisis, the Group updated the key macroeconomic forecasts namely the real GDP growth rate, unemployment rate and property indices in all three macroeconomic scenarios, incorporating the estimated impact of the second lock down and the overall effect that Covid-19 is expected to have on the macroeconomic outlook based on the most recent available information. In particular, for 2020, the IFRS 9 probability-weighted

scenario incorporated a sharp contraction in the real GDP growth rate, a significant increase in the unemployment rate and a decrease in the residential and commercial property indices, while a partial rebound in economic performance is expected in 2021, boosted by the use of the domestic and EU funds. More specifically, for the period 2020-2021, the cumulative decline in the real GDP growth rate stands at 6% and the cumulative increase in residential and commercial property indices at 2.7% and 2.0%, respectively, while the unemployment rate is expected at 17.9% at the end of 2021. For comparison purposes, the 2020-2021 forecasts in the pre-Covid-19 environment provided for a cumulative increase in real GDP growth rate, residential and commercial property indices of 4.7%, 7.9% and 8.3%, respectively, while the expected unemployment rate stood at 15.1% at the end of 2021.

The arithmetic averages of the scenarios' probability-weighted annual forecasts for the next four year period following the reporting date, used in the ECL measurement of Greek lending portfolios for the year ended 31 December 2020 and 31 December 2019, are set in the following table:

	As at 31 December 2020	As at 31 December 2019
Key macroeconomic indicator	Average (2021-2024) annual forecast	Average (2020-2023) annual forecast

Gross Domestic Product growth	3.36%	2.47%
Unemployment rate	16.57%	14.70%
Residential property prices' index	3.13%	3.96%
Commercial property prices' index	4.08%	4.17%

Changes in the scenarios and weights, the corresponding set of macroeconomic variables and the assumptions made around those variables for the forecast horizon would have a significant effect on the ECL amount. The Group independently validates all models and underlying methodologies used in the ECL measurement through competent resources, who are independent of the model development process.

Development of ECL models, including the various formulas, choice of inputs and interdependencies

For the purposes of ECL measurement the Group performs the necessary model parameterization based on observed point-in-time data on a granularity of monthly intervals. The ECL calculations are based on input parameters, i.e. exposure at default (EAD), PDs, loss given default (LGD), credit conversion factors (CCFs) etc. incorporating management's view of the future. The Group also determines the links between macroeconomic scenarios and, economic inputs, such as unemployment levels and collateral values, and the effect on PDs, EADs and LGDs.

Furthermore, the PDs are unbiased rather than conservative and incorporate relevant forward looking information including macroeconomic scenarios. The forecasting risk parameters models incorporate a number of explanatory variables, such as GDP, unemployment etc. which are used as independent variables for optimum predictive capability. The models are based on logistic regressions and run under the different macroeconomic scenarios and relevant changes and shocks in the macro environment reflected accordingly in a non-linear manner.

Segmentation of financial assets when their ECL is assessed on a collective basis

The Group segments its exposures on the basis of shared credit risk characteristics upon initial recognition for the purposes of both assessing significant increase in credit risk and measuring loan loss allowance on a collective basis. The different segments aim to capture differences in PDs and in the rates of recovery in the event of default. On subsequent periods, the Group re-evaluates the grouping of its exposures at least on an annual basis, in order to ensure that the groups remain homogeneous in terms of their response to the identified shared credit risk characteristics. Re-segmentation reflects management's perception in respect to the change of credit risk associated with the particular exposures compared to initial recognition.

Modeling and Management overlays / adjustments

A number of sophisticated models have been developed or modified to calculate ECL, while temporary management adjustments may be required to capture new developments and information available, which are not yet reflected in the ECL calculation through the risk models. Internal counterparty rating changes, new or revised models and data may significantly affect ECL. The models are governed by the Group's validation framework, which aim to ensure independent verification, and are approved by the Board Risk Committee (BRC).

In response to the Covid-19 pandemic, the Group applied the segregation approach detailed above in section ''Determination of a significant increase of credit risk'') to supplement its SICR assessment, in line with the IASB, the European Central Bank (ECB) and other banking regulators' statements.

In addition, the developments of the Covid-19 pandemic, induce a high level of uncertainty regarding their potential impact on the asset quality, considering that the customer relief measures introduced by the government as well as Group's support programs may not fully eliminate the potential credit deterioration and therefore temporarily delay its manifestation. In view of such anticipated adverse effect, Management proceeded with the estimation of a post-model adjustment of € 390 million, which forms part of the impairment allowance, in order to provide for the cliff effects after the expiration of moratoria in 2020 and 2021 by consequently increasing the NPE provisions coverage. In estimating the adjustment, Management exercised judgement based on the knowledge of the Group's lending portfolios, their particular characteristics and behavioral/transactional aspects.

Sensitivity analysis on lending portfolios

Sensitivity analysis when performed on certain key parameters can provide meaningful information only for portfolios where the risk parameters have a significant impact on the overall credit risk of a lending portfolio, particularly where such sensitivities are also used for internal credit risk management purposes. Otherwise, a sensitivity on certain combinations of some risk parameters may not produce meaningful results, as in reality there are interdependencies between the various economic inputs, rendering any changes in the parameters, changes correlated in other factors.

The sensitivity analysis presented in the tables below was performed assuming a favorable and an adverse shift in scenario weighting as at 31 December 2020. The former assumes an increase in the weighting of the optimistic scenario at 75% and a decrease in the weighting of the baseline scenario at 25%, while the latter assumes an increase in the weighting of the adverse scenario at 75% and a decrease in the weighting of the baseline scenario at 25% compared to the scenario weighting applied by the Group in ECL measurement. Based on these scenario weighting variations, a re-estimation of all key macroeconomic indicators linked to these variations, namely GDP growth, unemployment rate and property indices, was performed. The respective sensitivity analysis as at 31 December 2019 was performed by assuming an equal positive and negative combined change in the key macroeconomic indicators.

The tables below present the estimated effect in the Group's ECL measurement (including off-balance sheet items) per stage, upon potential reasonable combined changes of forecasts in key macroeconomic indicators over the next 5 years (2021-2025 and 2020- 2024, respectively):

	As at 31 December 2020	As at 31 December 2019
Sensitivity scenario				Sensitivity scenario
			Combined change %		Combined change %
Key macroconomic indicators	Positive change	Adverse change		Key macroconomic indicators	Positive change	Adverse change
GDP growth	12%	-15%	change of annual forecasts	GDP growth	30%	-30%	change of annual forecasts
Unemployment Rate	-3%	4%	change of annual forecasts	Unemployment Rate	-6.5%	+6.5%	change of annual forecasts
Property indices			change of index adjusted real estate collateral market	Property indices			change of index adjusted real estate collateral market
(RRE/CRE)	3%	-3%	values	(RRE/CRE)	3%	-3%	values

	Positive change						Adverse change
	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Lifetime ECL credit-impaired	31 December 2020	31 December 2019	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Lifetime ECL credit-impaired	31 December 2020	31 December 2019
Ιmpact in € million	(9)	(25)	(39)	(73)	(95)	14	30	43	88	103
Ιmpact in % allowance	-4.39	-5.52	-1.35	-2.06	-1.33	6.72	6.80	1.50	2.48	1.44

The Group updates and reviews the reasonability and performs back-testing of the main assumptions used in its methodology assessment for SICR and ECL measurement, at least on an annual basis or earlier, based on facts and circumstances. In this context,

experienced and dedicated staff within the Group's Risk Management function monitors the risk parameters applied for the estimation of ECL. Furthermore, as part of the well-defined governance framework, any revisions to the methodology used are approved by the Group competent committees and ultimately the Board Risk Committee (BRC).

3.2 Fair value of financial instruments

The fair value of financial instruments is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal (or most advantageous) market at the measurement date under current market conditions (i.e. an exit price) regardless of whether that price is directly observable or estimated using another valuation technique.

The fair value of financial instruments that are not quoted in an active market are determined by using other valuation techniques that include the use of valuation models. In addition, for financial instruments that trade infrequently and have little price transparency, fair value is less objective and requires varying degrees of judgment depending on liquidity, concentration, uncertainty of market factors, pricing assumptions and other risks affecting the specific instrument. In these cases, the fair values are estimated from observable data in respect of similar financial instruments or using other valuation techniques.

The valuation models used include present value methods and other models based mainly on observable inputs and to a lesser extent to non-observable inputs, in order to maintain the reliability of the fair value measurement.

Valuation models are used mainly to value over-the-counter derivatives and securities measured at fair value.

Where valuation techniques are used to determine the fair values of financial instruments that are not quoted in an active market, they are validated and periodically reviewed by qualified personnel independent of the personnel that created them. All models are certified before they are used, and are calibrated to ensure that outputs reflect actual data and comparative market prices. The main assumptions and estimates, considered by management when applying a valuation model include:

the likelihood and expected timing of future cash flows;
the selection of the appropriate discount rate, which is based on an assessment of what a market participant would regard as an appropriate spread of the rate over the risk-free rate; and
judgment to determine what model to use in order to calculate fair value.

To the extent practicable, models use only observable data, however areassuch as credit risk (both own and counterparty), volatilities and correlations require the Management to make estimates to reflect uncertainties in fair values resulting from the lack of market data inputs. Inputs into valuations based on unobservable data are inherently uncertain because there is little or no current market data available. However, in most casesthere will be some historical data on which to base a fair value measurement and consequently even when unobservable inputs are used, fair values will use some market observable inputs.

The effect of covid-19 pandemic to the credit spreads and market yields that increased significantly in March 2020 was quickly reversed due to the swift and large response of the global central banks.

Information in respect of the fair valuation of the Group's financial assets and liabilities is provided in note 5.3.

3.3 Classification of financial instruments

The Group applies significant judgment in assessing the classification of its financial instruments and especially, in the below areas:

Business model assessment

Judgment is exercised in order to determine the appropriate level at which to assess the business model. In assessing the business model of financial instruments, these are aggregated into groups (business lines) based on their characteristics, and the way they are managed in order to achieve the Group's business objectives. In general, the assessment is performed at the business unit level for lending exposures including securitized notes issued by special purpose entities established by the Group and debt securities. However, further disaggregation may be performed by business strategy/ region, etc.

In assessing the business model for financial instruments, the Group performs a past sales evaluation of the financial instruments and assesses their expected evolution in the future. Judgment is exercised in determining the effect of sales to a "hold to collect" business model depending on their objective and their acceptable level and frequency.

Contractual cash flow characteristics test (SPPI test)

The Group performs the SPPI assessment of lending exposures including securitized notes issued by special purpose entities established by the Group and debt securities by considering all the features which might potentially lead to SPPI failure. Judgment is applied by the responsible Business Units when considering whether certain contractual featuressignificantly affect future cash flows. Accordingly, for non-recourse financial assets, the Group assesses jointly criteria such as the adequacy of equity, LTV (Loan-to-Value) and DSCR (Debt-Service-Coverage-Ratio) ratios as well as the existence of corporate and personal guarantees. For the securitized notes issued by special purpose vehicles and held by the Group, the cash flow characteristics of the notes and the underlying pool of financial assets as well as the credit risk inherent in each securitization's tranche compared to the credit risk of all of the underlying pool of financial assets, are assessed. Furthermore, in order to assess whether any variability in the cash flows is introduced by the modified time value of money element, the Group performs a quantitative assessment (as described in note 2.2.9). Moreover, the Group evaluates certain cases on whether the existence of performance-related terms exposes the Group to asset risk rather to the borrower's credit risk.

The Group has established a robust framework to perform the necessary assessments in accordance with Group's policies in order to ensure appropriate classification of financial instruments, including reviews by experienced staff for lending exposures and debt securities.

3.4 Assess control over investees

Management exercises judgment in order to assess if the Group has control over another entity including structured entities based on the control elements set out in note 2.2.1 (i).

(a) Subsidiaries

The Group holds more than half of the voting rights in all subsidiaries, except from Hellenic Post Credit S.A. Further information in respect of the control assessment for the said subsidiary is provided in note 23.

(b) Structured entities

As part of its funding activity and non-performing loans' management strategy, the Group sponsors certain securitization vehicles, the relevant activities of which have been predetermined as part of their initial design by the Group. The Group is exposed to variability of returns from these vehicles through the holding of debt securities issued by them or by providing credit enhancements in accordance with the respective contractual terms. In assessing whether it has control, the Group considers whether it manages the substantive decisions that could affect these vehicles' returns. Accordingly, the Group assesses on a case-by-case basis the structure of securitization transaction, including the respective contractual arrangements, in order to conclude if it controls these vehicles.

Furthermore, the Group is involved in the initial design of various mutual funds in order to provide customers with investment opportunities. The Group primarily acts as an agent in exercising its decision making authority as it is predefined by the applicable regulated framework. As a result, the Group has concluded that it does not control these funds.

Further information in respect of the structured entities the Group is involved, either consolidated or not, is provided in note 25.

3.5 Income tax

The Group is subject to income taxes in various jurisdictions and estimates are required in determining the liability for income taxes. The Group recognizes liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due or for anticipated tax disputes. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax in the period in which such determination is made. Further information in relation to the above is provided in note 13.

In addition, the Group recognizes deferred tax assets to the extent that it is probable that sufficient taxable profit will be available against which unused tax losses and deductible temporary differences can be utilized. Recognition therefore involves judgment regarding the future financial performance of the particular Group legal entity in which the deferred tax asset has been recognized. Particularly, in order to determine the amount of deferred tax assets that can be recognized, significant management judgments are required regarding the likely timing and level of future taxable profits. In making this evaluation, the Group has considered all available evidence, including management's projections of future taxable income and the tax legislation in each jurisdiction.

The most significant judgment exercised by Management relates to the recognition of deferred tax assets in respect of losses realized in Greece. In the event that, the Group assesses that it would not be able to recover any portion of the recognized deferred tax assets in the future, the unrecoverable portion would impact the deferred tax balances in the period in which such judgment is made.

As at 31 December 2020, the Group revisited its estimates regarding the level of future taxable profits against which the unused tax losses and the deductible temporary differences can be utilized and evaluated accordingly the recoverability of the recognized deferred tax assets based on its three- year Business Plan, which was approved by the Board of Directors in December 2020 for the period up to the end of 2023, and was also submitted to the Single Supervisory Mechanism (SSM). For the years beyond 2023, the forecast of operating results was based on the Management projections considering the growth opportunities of the Greek economy, the banking sector and the Group itself. Specifically, the Management's projections for the Group's future profitability adopted in the above mentioned Business Plan, have considered, among others, the impact of the continuing Covid-19 pandemic and the relevant mitigating measures taken by the national and European authorities on the economy and the banking system.

As at 31 December 2020, an amount of € 1 million (2019: € 2 million) has been recognized in respect to unused tax losses using the Group's best estimation and judgment as described above.

Further information in respect of the recognized deferred tax assets and the Group's assessment for their recoverability is provided in note 13.

3.6 Retirement benefit obligations

The present value of the retirement benefit obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions, such as the discount rate and future salary increases. Any changes in these assumptions will impact the carrying amount of pension obligations.

The Group determines the appropriate discount rate used to calculate the present value of the estimated retirement obligations, at the end of each year based on interest rates of high quality corporate bonds. In countries where there is no deep market in such bonds, the yields on government bonds are used. The currency and term to maturity of the bonds used are consistent with the currency and estimated average term to maturity of the retirement benefit obligations. The salary rate increase assumption is based on future inflation estimates reflecting also the Group's reward structure and expected market conditions.

Other assumptions for pension obligations, such as future inflation estimates, are based in part on current and expected market conditions.

For information in respect of the sensitivity analysis of the Group's retirement benefit obligations to reasonably possible, at the time of preparation of these financial statements, changes in the abovementioned key actuarial assumptions, refer to note 36.

3.7 Investment properties

Investment property is carried at fair value, as determined by external, independent, certified valuators on an annual basis, or more frequently if deemed appropriate upon assessment of any relevant circumstances.

The main factors underlying the determination of fair value are related with rental income from current leases and assumptions about rental income from future leases in the light of current market conditions, future vacancy rates and periods, discount rates or rates of return, the terminal values as well as the level of future maintenance and other operating costs.

Additionally, where the fair value is determined based on market prices of comparable transactions those prices are subject to appropriate adjustments, in order to reflect current economic conditions and management's best estimate regarding the future trend of properties market based on advice received from its independent external valuers.

Further information in respect of the fair valuation of the Group's investment properties and the existing uncertainties due to Covid-19 pandemic is provided in note 27.

3.8 Provisions and contingent liabilities

The Group recognizes provisions when it has a present legal or constructive obligation, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of its amount.

A provision is notrecognized and a contingent liability is disclosed when it is not probable that an outflow of resources will be required to settle the obligation, when the amount of the obligation cannot be measured reliably or in case that the obligation is considered possible and is subject to the occurrence or non -occurrence of one or more uncertain future events.

Considering the subjectivity and uncertainty inherent in the determination of the probability and amount of the abovementioned outflows, the Group takes into account a number of factors such as legal advice, the stage of the matter and historical evidence from similar cases. In the case of an offer made within the context of the Group's voluntary exitscheme, the number of employees expected to accept the abovementioned offer along with their age cluster is a significant factor affecting the measurement of the outflow for the termination benefits.

Further information in relation to the Group's provisions and contingent liabilities is provided in notes 35 and 42.

3.9 Leases

The Group, as a lessee, determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised.

The Group applies judgement in evaluating whether it is reasonably certain or not to exercise an option to renew or terminate the lease, by considering all relevant factors and economic aspects that create an economic incentive. The Group reassesses the lease term if there is a significant event or change in circumstances that is within its control that affects its ability to exercise or not to exercise the option to renew or to terminate, such as significant leasehold improvements or significant customization of the leased asset.

In measuring lease liabilities, the Group uses the lessees' incremental borrowing rate ('IBR') when it cannot readily determine the interest rate implicit in the lease. The IBR is the rate of interest that the Group would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment.

Therefore, estimation is required when no observable rates are available (such as for subsidiaries that do not enter into financing transactions) or when they need to be adjusted to reflect the terms and conditions of the lease. The Group estimates the IBR using observable inputs (such as government bond yields) as a starting point when available, and performs certain additional entity-specific adjustments, such as credit spread adjustments or adjustments to reflect the lease terms and conditions. For the Bank and Greek subsidiaries, the IBR is derived from the estimated covered bonds yield curve, which is constructed based on observable Greek Government Bond yields, while for international subsidiaries the IBR is determined on a country basis, taking into consideration specific local conditions.

3.10 Other accounting estimates and judgments

Information in respect of other estimates and judgments that are made by the Group is provided in notes 5.2.4, 20, 21, 28, 30 and 31.

4. Capital Management

The Group's capital adequacy position is presented in the following table:

	2020	2019
	€ million	€ million
Total equity	5,245	6,667
Add: Adjustment due to IFRS 9 transitional arrangements	849	897
Less: Preferred securities	-	(2)
Less: Goodwill	(1)	(161)
Less: Other regulatory adjustments	(489)	(484)
Common Equity Tier 1 Capital	5,604	6,917
Add: Preferred securities subject to phase-out	-	-
Total Tier 1 Capital	5,604	6,917
Tier 2 capital-subordinated debt	950	950
Add: Other regulatory adjustments	-	97
Total Regulatory Capital	6,554	7,964
Risk Weighted Assets	40,237	41,407
Ratios:	%	%
Common Equity Tier 1	13.9	16.7
Tier 1	13.9	16.7
Total Capital Adequacy Ratio	16.3	19.2

Notes: a) The Group has elected to apply the phase-in approach for mitigating the impact of IFRS 9 transition on the regulatory capital, according to the Regulation (EU) 2017/2395 (providing a 5-year transition period to recognize the impact of IFRS 9 adoption) and the Regulation 2020/873 (CRR quick fix), b) The Group's CET1 as at 31 December 2020, based on the full implementation of the Basel III rulesin 2025 (fully loaded CET1), referring mainly to the completion of the aforementioned IFRS 9 transitional arrangements, would be 12% (2019: 14.6%).

The Group has sought to maintain an actively managed capital base to cover risks inherent in the business. The adequacy of the Group's capital is monitored using, among other measures, the rules and ratios established by the Basel Committee on Banking Supervision (BIS rules/ratios) which have been incorporated in the European Union (EU) legislation through the Directive 2013/36/EU (known as CRD IV), along with the Regulation No 575/2013/EU (known as CRR). Directive 2013/36/EU was transposed into Greek legislation by Law 4261/2014. Supplementary to that, in the context of Internal Capital Adequacy Assessment Process (ICAAP), the Group considers a broader range of risk types and the Group's risk management capabilities. ICAAP aims ultimately to ensure that the Group has sufficient capital to cover all material risks that it is exposed to, over a three-year horizon.

Based on Council Regulation No 1024/2013, the European Central Bank (ECB) conducts annually a Supervisory Review and Evaluation Process (SREP) in order to define the prudential requirements of the institutions under its supervision. The key purpose of the SREP is to ensure that institutions have adequate arrangements, strategies, processes and mechanisms as well as capital and liquidity to ensure a sound management and coverage of their risks, to which they are or might be exposed, including those revealed by stress testing and risks the institution may pose to the financial system.

In response to the Covid-19 outbreak, on 12 March 2020, the ECB announced a number of measures to ensure that its directly supervised institutions can continue to fulfil their role in funding the real economy (note 2). Specifically, banks are allowed, among others, to operate below the level of capital defined by the Pillar 2 Guidance and, without prejudice to the restrictions set out in CRD IV, the Combined Buffer Requirement (i.e. Capital Conservation Buffer, Countercyclical Capital Buffer, Other Systemically Important Institutions Buffer) until at least the end of 2022, as per the latest ECB's communication issued on 28 July. Banks are also allowed to partially use capital instruments that do not qualify as CET1 capital (i.e. Additional Tier 1 or Tier 2 instruments) to meet the Pillar 2 Requirement (P2R).

Taking into account the aforementioned developments and the 2020 SREP decision, for 2021, the Group is required to meet a Common Equity Tier 1 ratio of at least 9.24% and a Total Capital Adequacy Ratio of at least 14.05% (Overall Capital Requirement or OCR), including the Combined Buffer Requirement. The capital relief measures mentioned above do not change the level of the Combined Buffer Requirement (stands at 3.05% and covered with CET1 capital), which sits on top of the Total SREP Capital Ratio

(11%) resulting in an OCR of 14.05% in terms of total capital. According to the FAQs published by the ECB (last updated 1 February 2021), the allowance provided to banks to operate below the combined buffer requirement results in the ECB taking a flexible approach to approving capital conservation plans that banks are legally required to submit if they breach the combined buffer requirement.

	31 December 2020
	CET1 Capital Requirements	Total Capital Requirements
Minimum regulatory requirement	4.50%	8.00%
Pillar 2 Requirement (P2R)	1.69%	3.00%
Total SREP Capital Requirement (TSCR)	6.19%	11.00%
Combined Buffer Requirement (CBR)
Capital conservation buffer (CCoB)	2.50%	2.50%
Countercyclical capital buffer (CCyB)	0.05%	0.05%
Other systemic institutions buffer (O-SII)	0.50%	0.50%
Overall Capital Requirement (OCR)	9.24%	14.05%

Furthermore, on 24 June 2020 the Regulation 2020/873 (CRR quick fix) was adopted by the Council of the European Union and the European Parliament. This Regulation introduced some changesin the CRR to maximize the ability of banksto continue lending during the Covid-19 pandemic. These changes include among others:

-Extension by two years of the transitional arrangements for IFRS 9 and further relief measures, allowing banks to add back to their regulatory capital any increase in new provisions for expected losses that they recognize in 2020 and 2021 for their financial assets, which have not been defaulted. Accordingly, the relief applied for 2022 is 75%, for 2023 50% and for 2024 25%.

-Earlier application of the revised supporting factors for loans to SMEs and certain infrastructure projects' companies, which allows for a more favorable prudential treatment of these exposures.

-A preferential treatment of exposures to public debt issued in the currency of another Member State and flexibility regarding the large exposures limit.

Further disclosures regarding capital adequacy in accordance with the Regulation 575/2013, including the regulatory developments and relief measures introduced with CRR quick fix, are available in the Consolidated Pillar 3 Report for the year ended 31 December 2020 on the Company's website.

EU – wide stress test

On 12 March 2020, the EBA and the ECB decided to postpone the stress test exercises to 2021 to mitigate the impact of Covid-19 on the EU banking sector and thus allow banks to focus on and ensure continuity of their core operations, including support for their customers.

In January 2021, the EBA launched the 2021 EU-wide stress test exercise which will provide valuable input for assessing the resilience of the European banking sector, notably its ability to absorb shocks under adverse macroeconomic conditions.

In parallel, the ECB also conducts its own stress test for the banks it directly supervises but that are not included in the EBA-led stress testsample. This exercise is consistent with the EBA's methodology and apply the same scenarios, while also including proportionality

elements as suggested by the overall smaller size and lower complexity of these banks. Eurobank Holdings Group participates in the ECB-led stress test.

5. Financial risk management and fair value

5.1 Use of financial instruments

By their nature the Group's activities are principally related to the use of financial instruments including derivatives. The Group accepts deposits from customers, at both fixed and floating rates, and for various periods and seeks to earn above average interest margins by investing these funds in high quality assets. The Group seeks to increase these margins by consolidating short-term funds and lending for longer periods at higher rates, while maintaining sufficient liquidity to meet all claims that might fall due.

The Group also seeks to raise its interest margins by obtaining above average margins, net of provisions, through lending to commercial and retail borrowers within a range of credit standing. Such exposures include both on-balance sheet loans and advances and off-balance sheet guarantees and other commitments such as letters of credit.

The Group also trades in financial instruments where it takes positions in traded and over the counter financial instruments, including derivatives, to take advantage of short-term market movements in the equity and bond markets and in currency and interest rates.

5.2 Financial risk factors

Due to its activities, the Group is exposed to several financial risks, such as credit risk, market risk (including currency, interest rate, spread, equity and volatility risk), liquidity and operational risks. The Group's overall risk management strategy seeks to minimize any potential adverse effects on its financial performance, financial position and cash flows.

Risk Management objectives and policies

The Group acknowledges that taking risks is an integral part of its operations in order to achieve its business objectives. Therefore, the Group's management sets adequate mechanisms to identify those risks at an early stage and assesses their potential impact on the achievement of these objectives.

Due to the fact that economic, industry, regulatory and operating conditions will continue to change, risk management mechanisms are set in a manner that enable the Group to identify and deal with the risks associated with those changes. The Bank's structure, internal processes and existing control mechanisms ensure both the independence principle and the exercise ofsufficientsupervision.

The Group's Management considers effective risk management as a top priority, as well as a major competitive advantage, for the organization. As such, the Group has allocated significant resources for upgrading its policies, methods and infrastructure, in order to ensure compliance with the requirements of the European Central Bank (ECB) and of the Single Resolution Board (SRB), the guidelines of the European Banking Authority (EBA) and the Basel Committee for Banking Supervision and the best international banking practices. The Group implements a well-structured credit approval process, independent credit reviews and effective risk management policies for credit, market, liquidity and operational risk, both in Greece and in each country of its international operations. The risk management policies implemented by the Group are reviewed annually.

The Group Risk and Capital Strategy, which has been formally documented, outlines the Group's overall direction regarding risk and capital management issues, the risk management mission and objectives, risk definitions, risk management principles, risk appetite framework, risk governance framework, strategic objectives and key management initiatives for the improvement of the risk management framework in place.

The maximum amount of risk which the Group is willing to assume in the pursuit of its strategic objectives is articulated via a set of quantitative and qualitative statements for specific risk types, including specific tolerance levels as described in the Group's Risk Appetite Framework. The objectives are to support the Group's business growth, balance a strong capital position with higher returns on equity and to ensure the Group's adherence to regulatory requirements.

Risk appetite that is clearly communicated throughout the Group, determines risk culture and forms the basis on which risk policies and risk limits are established at Group and regional level.

Board Risk Committee (BRC)

The Board Risk Committee (BRC) is a committee of the BoD and itstask isto assist the BoD to ensure that the Group has a well-defined risk and capital strategy in line with its business plan and an adequate and robust risk appetite.

Τhe BRC assesses the Group's risk profile, monitors compliance with the approved risk appetite and risk tolerance levels and ensures that the Group has developed an appropriate risk management framework with appropriate methodologies, modelling tools, data sources and sufficient and competent staff to identify, assess, monitor and mitigate risks. Moreover, BRC is conferred with certain approval authorities for credit proposals, debt forgiveness and write-offs.

The BRC consists of six (6) non-executive directors, meets at least on a monthly basis and reports to the BoD on a quarterly basis and on ad hoc instances if it is needed.

Management Risk Committee

The Management Risk Committee (MRC) is a management committee established by the CEO and operates as an advisory committee to the BRC.

The main responsibility of the MRC is to oversee the risk management framework of the Group. As part of its responsibility, the MRC facilitatesreporting to the BRC on the range of risk-related topics under its purview. The MRC ensures that material risks are identified and promptly escalated to the BRC and that the necessary policies and procedures are in place to prudently manage risks and to comply with regulatory requirements. Additionally, the MRC determines appropriate management actions which are discussed and presented to the Executive Board ('EXBO') for information and submitted to BRC for approval.

Group Risk Management General Division

The Group's Risk Management General Division which is headed by the Group Chief Risk Officer (GCRO), operatesindependently from the business units and is responsible for the monitoring, measurement and management of credit, market, operational and liquidity risks of the Group. It comprises of the Group Credit General Division, the Group Credit Control Sector (GCCS), the Group Credit Risk Capital Adequacy Control Sector (GCRCACS), the Group Market and Counterparty Risk Sector (GMCRS), the Group Operational Risk Sector, the Group Model Validation and Governance Sector, the Group Risk Management Strategy Planning and Operations Division, the Supervisory Relations and Resolution Planning Sector (dual reporting also to the Group Chief Financial Officer) and the Risk Analytics Division.

Non-Performing Exposures (NPEs) management

A strategic priority for the Group remains the active and effective management of NPEs with the aim to further reduce the NPEs stock in accordance with its operational targets agreed with the supervisory authorities, leveraging the external strategic partnership that it has entered into, as described below, and the important legislative changes that have taken or are expected to take place.

Following the completion of corporate transformation (Hive-down) on 20 March 2020 and in accordance with the "Europe" and "Cairo" transactions on 5 June 2020, the Group entered into a strategic partnership with doValue S.p.A. for the management of its NPEs, the majority of which are included in the securitized portfolio of entity ERB Recovery Designated Activity Company (DAC). In particular, the Group assigned the management of its remaining NPE portfolio, Retail early arrears and any future assets in the aforementioned perimeter, to doValue Greece Loans and Credits claim Management S.A. ("doValue Greece") through a 14-year Service Level Agreement ("SLA"). The Group retains the business ownership and overall responsibility for the performance of the NPEs and manages the relationship with doValue Greece through a structured governance and a solid control framework. In this context, Eurobank established Remedial Servicing & Strategy Sector («RSS»), a dedicated team that devises the NPE reduction plan, actively sets the strategic principles and Key Performance Indicators (KPIs) framework under which doValue Greece manages the portfolio, closely monitors the execution of the approved strategies and service level agreements and ensures compliance with regulatory requirements.

have been granted by the Greek Banks since end March 2020 in order to support borrowers that face financial difficulties due to the pandemic crisis and have applied for the moratoria up to 31/03/2021.

Troubled Assets Committee

Remedial and Servicing Strategy (RSS)

In this context, RSS is a dedicated team that inter alia with the following responsibilities:

Develop and actively monitor the NPE targets and reduction plan
Set the strategic principles, priorities, policy framework and KPIs under which doValue Greece is servicing the portfolio
Closely monitor the execution of the approved strategies, as well as all contractual provisions under the relevant contractual agreements for the Eurobank portfolio assigned to doValue Greece including the securitized portfolio of ERB Recovery DAC
Monitoring of the performance of the senior notes of the securitizations and collaboration with Group Risk so as to ensure compliance to Significant Risk Transfer regulatory provisions
Budgeting and monitor of the Bank's expenses and revenues associated with the assigned portfolio
Cooperate closely with doValue Greece on a daily basis in achieving the Group's objectives
Maintain supervisory dialogue

Operational targets for Non-Performing Exposures (NPEs)

In March 2020, after considering the extraordinary circumstances due to the Covid-19 pandemic, the SSM informed the European banks that the submission of their new 3-year NPE Management Strategy was postponed for March 2021. Specifically, in the context of the dialogue with SSM and its close monitoring on NPEs reduction progress, at the end of September 2020, Eurobank and the other Greek systemic banks submitted their updated NPE Management Strategy for the period 2020-2022 along with the NPE annual targets at group level, in a preliminary and draft form. Further, in March 2021, the Group submitted its 2021-2023 NPEs Strategy and plan, in accordance with the standard submission cycle. This envisaged the decrease of NPE ratio at ca. 9% at the end of 2021, 6.5% in 2022 and below 6% in 2023.

Pursuant to Law 4649/2019, on 25 February 2020, Eurobank submitted two applications for Cairo I and Cairo II securitisations and on 15 May 2020 a third one for the Cairo IIIsecuritization to the Ministry of Finance for opting-in to the Hellenic Asset Protection Scheme ("HERCULES"), which were all approved on 23 July 2020. With the closing of the Cairo transaction in early June 2020 and the subsequent derecognition of the underlying securitised loan portfolio of € 7.2 billion (consisting primarily of NPEs) in September 2020, the Group reduced significantly its NPE stock by € 7.3 billion reaching € 5.7 billion as at 31 December 2020 (31 December 2019: € 13.0 billion), driving the NPE ratio at 14.0% as at 31 December 2020 (31 December 2019: 29%).

In March and April 2020, EBA and the ECB announced guidelines aiming to mitigate the impact of the Covid-19 pandemic on the EU banking sector stating, among others, that there is flexibility in the implementation of the EBA Guidelines on management of nonperforming and forborne exposures. Additionally, EBA called for a close dialogue between supervisors and each bank on their nonperforming exposure strategies.

Eurobank has been taking all appropriate actions to address liquidity difficulties of businesses and individuals caused by the limited orsuspended operations of businessesresulting from the impact of Covid-19. In this context, Eurobank has defined a set of emergency relief measures that will apply to specific segments that are affected by Covid-19. These include moratoria to households (deferral of interest and principal payments) and to legal entities and professionals (deferral of principal payments) (note 5.2.1.2).

Legal Framework

The protection scheme on primary residence was voted by the Greek Parliament in March 2019 (Law 4605/2019), aiming at reinforcing the banks' effortsto reduce NPEsthrough a more effective mechanism to work out troubled loans, a restriction ofstrategic defaulters and, ultimately, an improvement in payment discipline. The scheme expired in July 2020, instead of April 2020 as initially scheduled and in October 2020, a new law (Law 4738/2020) was enacted introducing a comprehensive insolvency framework for individuals and companies in order to assist them to settle all their debts to the State, insurance funds, banks and servicers. The implementation of the new insolvency framework is expected within 2021.

In July 2020, a subsidy ('Gefyra') program (Law 4714/2020) was introduced by the Government in order to assist borrowers impacted by Covid-19. Applications were admitted until 31 October 2020 while the subsidy may start no later than 1 April 2021. The subsidy program will last for 9 months, followed by a probation period of 6 to 18 months (depending on the status of the borrower) with a clawback clause in case of overdue instalments. In the same context, on 31 March 2021 a new subsidy ('Gefyra II') program (Law 4790/2021) wasintroduced for eligible Small Business professionals and legal entities, as well as SMEs. Applications may be submitted until 9 May 2021, while the subsidy will cover part of the instalments for 8 months, followed by a probation period up to 18 months, depending on the loan status (note 5.2.1.2 (e)).

5.2.1 Credit Risk

Credit risk is the risk that a counterparty will be unable to fulfill its payment obligations in full when due. Credit risk is also related with country risk and settlement risk, specified below:

a) Country risk is the risk of losses arising from cross-border lending and investment activities and refers to the uncertainty associated with exposure in a particular country. This uncertainty may relate to a number of factors including the risk of losses following nationalization, expropriation, debt restructuring and foreign exchange rates' movement.
b) Settlement risk is the risk arising when payments are settled, for example for trades in financial instruments, including derivatives and currency transactions. The risk arises when the Group remits payments before it can ascertain that the counterparties' payments have been received.

Credit risk arises principally from the wholesale and retail lending activities of the Group, as well as from credit enhancements provided, such as financial guarantees and letters of credit. The Group is also exposed to credit risk arising from other activities such as investments in debt securities, trading, capital markets and settlement activities. Taking into account that credit risk is the primary risk the Group is exposed to, it is very closely managed and monitored by specialised risk units, reporting to the GCRO.

(a) Credit approval process

The credit approval and credit review processes are centralized both in Greece and in the International operations. The segregation of duties ensures independence among executives responsible for the customer relationship, the approval process and the loan disbursement, as well as monitoring of the loan during its lifecycle.

Credit Committees

The credit approval process in Corporate Banking is centralized through establishment of Credit Committees with escalating Credit Approval Levels. Main Committees of the Bank are considered to be the following:

Credit Committees (Central and Local) authorized to approve new financing, renewals or amendments for domestic groups in the existing credit limits, in accordance with their credit approval authority, depending on total limit amount and customer risk category (i.e. high, medium or low), as well as the value and type of security;
Special Handling Credit Committees authorized to approve credit requests and take actions for distressed clients;
International Credit Committees (Regional and Country) established for the wholesale borrowers of the Group's international bank subsidiaries, authorized to approve new limits, renewals or amendments to existing limits, in accordance with their credit approval authority, depending on total customer exposure and risk category (i.e. high, medium or low), as well as the value and type of security; and
International Special Handling Committees established for handling distressed wholesale borrowers of the Group'sinternational bank subsidiaries.

The Credit Committees meet on a weekly basis or more frequently, if needed.

Group Credit General Division (GCGD)

Within an environment of increased risk challenges, Group Credit General Division (GCGD) mission is to safeguard the banks' asset side, by evaluating creditrisk and making recommendations,so that borrowers' credit exposure is acceptable and within the approved Risk Appetite Framework. GCGD is headed by the Group Chief Credit Officer (GCCO) with direct reporting to the Group Chief Risk Officer (GCRO).

GCGD operations are comprised of two functions, i.e. the Corporate Credit Risk, including both the domestic and the foreign underwriting activities (the latter only for Global Clients and material exposures of International Subsidiaries), and Retail Credit Risk respectively, covering the underwriting needs of the SBB portfolio and the individuals (mortgage, consumer loans, auto-moto loans and credit cards).

1. Corporate Credit Risk

(a) Domestic and Greek related portfolio : the underwriting function includesthe review of credit requests originating from Corporate Units handling large and medium scale corporate entities of every risk category and specialised lending units such as Shipping and Structured Finance (Commercial Real Estate, Hotel & Leisure, Project Finance) and Private Banking. Major tasks of the respective workstream and involved credit units pertain to the following:

Evaluation of credit applications and issuance of an independent Risk Opinion , which includes:
- (i) assessment of the customer credit profile based on the qualitative and quantitative risk factors identified (market, operational, structural and financial )
- (ii) recommendations for the formulation of bankable, well-secured and well-controlled transactions (credit facility), as well as (iii) review and confirmation of the ratings of each separate borrower to reflect the risks acknowledged.
Participation with voting right in all credit committees as per the Credit Approval procedures.
Active participation in the regulatory audits and major internal projects of the Bank, providing at the same time credit related knowledge, expertise and support to other divisions.
Preparation of specialised reports to Management on a regular basis, with regards to the Top 25 largest, in terms of total exposure, borrower Groups, statistics on the new approved financings and leveraged transactions.

(b) International Subsidiaries' portfolio: The GCGD through its specialized International Credit Sector (ICS) is responsible to actively participate in the design, implementation and review of the credit underwriting function for the wholesale portfolio of the International Subsidiaries covering Bulgaria, Cyprus, Serbia, the remaining Romania portfolio and portion of the loan portfolio of Luxemburg (including London Branch). Moreover, the respective unit's tasks and responsibilities are highlighted below:

Participation with voting right in all International Committees (Regional and Special Handling) and Country Risk Committees (CRCs);
Participation in the sessions of Special Handling Monitoring Committees for Bulgaria and Serbia which monitor and decide on the strategy of problematic corporate relationships with loan outstanding exceeding a certain threshold, that is jointly set by ICS and Country Troubled Asset Groups;
Advice on best practices to the Credit Risk Units of International Subsidiaries
Initiation of, or participation in, non-recurring credit related projects involving the International Subsidiaries, such as, indicatively, Wholesale Field Reviews, regulatory Asset Quality Reviews, acquisition and/or sale of wholesale portfolios etc.

GCGD is also responsible for the preparation of all credit committees' agendas, distribution of the respective material and maintenance of the respective Credit Committees' minutes.

2. Retail Credit Risk

The scope of the Retail Banking Credit Risk & Underwriting Sector isthe assessment of credit applicationssubmitted by Retail Business Units (domestic operations only), in relation to Borrowers of the retail credit portfolio (SBB loans and Individuals' banking) based on thresholds, for which an assessment by GCGD is required as per the provisions of the relevant Credit Approval Procedures.

The tasks of Retail Credit Risk function are outlined below:

Assess credit requests in alignment with the credit risk granting criteria and methodology provided in the appropriate Credit Policy Manual. The evaluation of the SBB portfolio includes the assessment of the borrower's financial position and statistical scorecards. Regarding the Individual Banking (mortgage and consumer loans), the credit criteria include among others the payment behaviour, financial position of the borrower, the existence of real estate property and the type and quality of securities.
Analyze and evaluate risk factors depending on the type of credit request.
Prepare an independent Credit Opinion presenting the official GCGD opinion on the credit application and confirm, where required, the Borrower Rating for each Borrower in its portfolio ensuring that the risksidentified are dully reflected in the Rating.
Participate with voting rights in the credit committees as per the credit approval process, according to the Approval Levels defined in the Credit Policy Manual.

(b) Credit risk monitoring

Group Credit Control Sector

The Group Credit Control Sector (GCCS) monitors and assesses the quality of all of the Group's loan portfolios and operates independently from the business units of the Bank. The GCCS reports directly to the GCRO.

The main responsibilities of the GCCS are to:

supervise, support and maintain the credit rating and impairment systems used to assess the wholesale lending customers;
monitor and review the performance of all of the Group's loan portfolios;
supervise and control the foreign subsidiaries' credit risk management units;
monitor on a regular basis and report on a quarterly basis to the Board of Directors and the BRC of risk exposures, along with accompanying analyses;
monitor and evaluate the efficiency of adopted strategies and proposed solutions in terms of dealing with Non Performing Exposures (NPEs) and the achievement of targets for NPEs reduction, as communicated and agreed with the Supervisory Authorities;
conduct field reviews and prepare written reports to the Management on the quality of all of the Group's loan portfolios and adherence with EBA prevailing regulations;
ensure that EBA classifications are made in accordance with the relevant provisions and guidelines;
participate in the approval of new credit policies and new loan products;
participate in the Troubled Asset Committee;
attend meetings of Credit Committees and Special Handling Committees, without voting right;
formulate the Group's credit impairment policy and measure the provisions of the Greek loan portfolios along with the relevant reporting to Management;
regularly review the adequacy of provisions of all of the Group's loan portfolios;
formulate, in collaboration with the responsible lending Units the credit policy manuals for performing borrowers;
provide guidance and monitor the process of designing and reviewing credit policies before approved by Management.
monitor the proper technical valuation of Real Estate collaterals, as per the Banks' Collateral Valuation policy and procedures;
monitor the supervisory, regulatory developments, emerging trends and best practices within its purview in order to keep Management abreast and propose required actions; and

Group Credit Risk Capital Adequacy Control Sector

The Group Credit Risk Capital Adequacy Control Sector implements and maintains the Internal Ratings Based (IRB) approach in accordance with the Basel framework and the Capital Requirements Directive (CRD) and maintains the credit risk assessment models for the loans portfolio of the Group. The Sector reports directly to the GCRO.

Specifically, the main responsibilities of the Group Credit Risk Capital Adequacy Control Sector are to:

control, measure and monitor the capital requirements arising from the Bank's loan portfolio along with the relevant reporting to Management and regulators (ECB/SSM);
measure and monitor the risk parameters (PD, LGD, EAD) for the purposes of capital adequacy calculations, as well as, the estimation of risk related parameters (such as forecast 12-m PD, forecast lifetime PD) for impairment calculation purposes;
review the grouping of lending exposures and ensuring their homogeneity in accordance with the Group's IFRS accounting policies
re-assess and re-develop if required, the significant increase in credit risk (SICR) thresholds under IFRS9 standard;
prepare monthly capital adequacy calculations(Pillar 1) and relevant management, as well as, regulatory reports(COREPs, SREP) on a quarterly basis;
participate in the preparation of the business plan, the NPE targets plan and the recovery plan of the Group in relation to asset quality and capital requirements for the loan book (projected impairments and RWAs), as well as participate in the relevant committees;
perform stress tests, both internal and external (EBA/SSM), and maintain the credit risk stress testing infrastructure;
coordinate the stress testing exercises for the loan portfolios at Group Level;
monitor the regulatory framework in relation to the IRB framework performing impact assessment by initiating and managing relevant projects;
manage the models development, implementation, monitoring of the IRB models of Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default (EAD) for evaluating credit risk;
prepare the credit risk analyses for Internal Capital Adequacy Assessment (ICAAP)/ Pillar 2 purposes;
implement the IRB roll-out plan of the Group;
prepare the Basel Pillar 3 disclosures for credit risk;
regularly report to the GCRO, to the Management Risk Committee and to the Board Risk Committee on: risk models performance, risk parameters (PD, LGD, EAD), updates on regulatory changes and impact assessment and asset quality reviews;
guide, monitor and supervise the Credit Risk divisions of the subsidiaries on modelling, credit stress testing and other credit risk related regulatory issues.
monitor and guide Group's international subsidiaries on credit risk related ICAAP, stress testing and other regulatory credit risk related issues, based on Group standards. Review of local credit risk stress test exercises;
support the business units in the use of credit risk models in business decisions, for funding purposes, in the capital impact assessment of strategic initiatives and the development and usage of risk related metrics such as risk adjusted pricing, Risk Adjusted Return on Capital (RAROC) etc.; and
assist Remedial Servicing Strategy Sector in the risk assessment and risk impact of various programs and products.

Group Model Validation and Governance Sector

The Group Model Validation and Governance Sector was established in September 2018, with key mandates:

the establishment of a comprehensive model governance and validation framework, and
the independent validation of the technical and operational completeness of all models used by the Group and their parameters, as well as their compliance with the provisions of the regulatory framework.

In more detail, the tasks of the Sector are outlined as follows:

Prepare and update the Group's Models Framework (to include model definition, roles involved per model, model classification principles and methodology, model validation principles, materiality classifications and thresholds, models' registry governance, etc.);
Establish and update the Group's Models Registry;
Review models' classification, in accordance with the methodology provided in the Group Models Framework;
Prepare and update the Group Models Validation Framework, while providing support to Group's subsidiaries in its implementation;
Monitor changes in ECB guidelines on models' validation;
Propose and escalate for approval the quantitative thresholds, in order to assess the results of the validation tests;
Conduct model validation tests in alignment with the Group Model Validation Framework and regulatory requirements;
Prepare detailed reports of the model valuation results according to the specific requirements of the model validated, if any, which are communicated to BRC on an annual basis along with any related proposed remediation plan;
Disseminate models' validation test results within the Group's BRC or MRC following reporting to Group CRO, as appropriate;
Prepare action plan for remediation actions, if any, as a result of the model validation tests implemented, and escalate the plan for its approval by the appropriate Management Authority;
Participate in the approval process of new models for assessing ratings' system accuracy and suitability; and
Monitor industry practices on the development and use of models as well as related ECB guidelines and restrictions.

Group Market and Counterparty Risk Sector

Group Market and Counterparty Risk Sector (GMCRS) is responsible for the measurement, monitoring and periodic reporting of the Group's exposure to counterparty risk (issuer risk and market driven counterparty risk), which is the risk of loss due to the customer's failure to meet its contractual obligations in the context of treasury positions, such as debt securities, derivatives, repos, reverse repos, interbank placings, etc.

In addition, GMCRS monitors, controls and regularly reports country limits, exposures and escalates breaches to the Management and to Committees. GMCRS uses a comprehensive methodology approved by the BRC, for determining the acceptable country risk level, including the countries in which the Group has a strategic presence.

The Group sets limits on the level of counterparty risk that are based mainly on the counterparty's credit rating, as provided by international rating agencies, the product type and the maturity of the transaction (e.g. control limits on net open derivative positions by both amount and term, sovereign bonds exposure, corporate securities, asset backed securities etc.).

GMCRS maintains and updates the limits' monitoring systems and ensures the correctness and compliance of all financial institutions limits with the Bank's policies as approved by the Group's relevant bodies.

The utilization of the abovementioned limits, any excess of them, as well as the aggregate exposure per Group's entity, counterparty and product type are monitored by GMCRS on a daily basis. Risk mitigation contracts are taken into account for the calculation of the final exposure.

Also, GMCRS ensures that the exposure arising from counterparties complies with the approved country limits framework. The GMCRS's exposure measurement and reporting tool is also available to the Group'ssubsidiariestreasury divisions, thus enabling them to monitor each counterparty's exposure and the limit availability.

Additionally, for the banks' corporate bond portfolio, GMCRS measures and monitors daily the total notional limits, the sectoral concentration and the maximum size per issuer. It uses a measurement tool for monitoring any downgrades and any idiosyncratic spread widening from purchase and any breach is communicated to the Management and to the relevant Committees.

GMCRS implements the market's best practices and safeguards the compliance of all involved parties to limits' policies and procedures. To this direction, for various units and International subsidiaries, GMCRS provides support and guidance for implementation of the limits' guidelines and policies.

Furthermore, GMCRS prepares specialized reports for the Management/Committees along with regular reporting that includes the exposure to the Hellenic Republic and a report that is based on the calculation of the Lifetime Expected Losses for the exposure towards the Hellenic Republic (HR).

(c) Credit related commitments

The primary purpose of credit related commitments is to ensure that funds are available to a customer as agreed. Financial guarantee contracts carry the same credit risk as loans since they represent irrevocable assurances that the Group will make payments in the event that a customer cannot meet its obligations to third parties. Documentary and commercial letters of credit, which are written undertakings by the Group on behalf of a customer authorizing a third party to draw drafts on the Group up to a stipulated amount under specific terms and conditions, are secured by the underlying shipment of goods to which they relate and therefore carry less risk than a loan. Commitments to extend credit represent contractual commitments to provide credit under pre-specified terms and conditions (note 42) in the form of loans, guarantees or letters of credit for which the Group usually receives a commitment fee. Such commitments are irrevocable over the life of the facility or revocable only in response to a material adverse effect.

(d) Concentration risk

The Group structures the levels of credit risk it undertakes by placing exposure limits by borrower, or groups of borrowers, and by industry segments. The exposure to each borrower is further restricted by sub-limits covering on and off-balance sheet exposures, and daily delivery risk limits in relation to trading items such as forward foreign exchange contracts.

Such risks are monitored on a revolving basis and are subject to an annual or more frequentreview. Risk concentrations are monitored regularly and reported to the BRC. Such reports include the 25 largest exposures, major watch list and problematic customers, industry analysis, analysis by rating/risk class, by delinquency bucket, and loan portfolios by country.

(e) Rating systems

Rating of wholesale lending exposures

The Group has decided upon the differentiation of rating models for wholesale lending activities, in order to reflect appropriately the risks arising from customers with different characteristics. Accordingly, the Group employs the following rating models for the wholesale portfolio:

Moody's Risk Analyst model ("MRA" or "Fundamental Analysis"-"FA") is used to assess the risk of borrowers for Corporate Lending.
Internal Credit Rating model ("ICR") is used for those customers that cannot be rated by MRA.
Transactional Rating model ("TR") has been developed in order to assess the risk of transactions taking into consideration their collaterals/guarantees.
Slotting rating models are employed in view of assessing the risk of specialized exposures, which are part of the Specialized Lending corporate portfolio.
Finally, an assessment of the borrowers' viability and the identification of impairment triggers is performed using the "Unlikely to Pay" ("UTP") / impairment test.

MRA, ICR, Slotting and "UTP" functions are supported by the Risk Analyst ("RA") computing platform provided by an external provider (Moody's Analytics), while the TR is internally developed and is being supported by the core applications of the Bank.

MRA follows the Moody's fundamental analysis (FA) approach. The FA models belong to a family of models defined as Knowledge Based Systems and rely on a probabilistic reasoning approach. They use quantitative and qualitative information of individual obligors in order to assess their creditworthiness and determine their credit rating. In particular, MRA takes into account the entity's balance sheets, profit & loss accounts and cash flow statements to calculate key ratios. Its ratio analysis includes assessments of each ratio's trend across multiple periods, both in terms of the slope and volatility of the trend. It also compares the value of the ratio for the most recent period with the quartile values for a comparable peer group. Moreover, MRA is supplied with a commonly used set of qualitative factors relating to the quality of the company's management, the standing of the company within its industry and the perceived riskiness of the industry. MRA is used for the assessment of all legal entities with full accountancy tax books irrespective of their legal form, and is calibrated on the Greek corporate environment.

The MRA is not employed for certain types of entities that use different accounting methods to prepare their financial statements, such as Insurance companies and brokerage firms. Moreover, entities such as start-ups that have not produced financial information for at least two annual accounting periods are not rated with MRA. In such cases, the Internal Credit Rating ("ICR") is utilized, which is a scorecard consisting of a set of factors grouped into 3 main sections corresponding to particular areas of analysis: Financial Information, Qualitative Criteria, and Behavior Analysis. In addition, the Group performs an overall assessment of wholesale customers, based both on their rating (MRA or ICR) and the collaterals and guarantees regularly at every credit assessment.

With reference to Specialized Lending portfolio (for which the Bank is using Slotting rating models) and in line with European Banking Authority (EBA) definitions, it comprises types of exposures towards entities specifically created to finance or operate physical assets, where the primary source of income and repayment of the obligation lies directly with the assets being financed. Accordingly, three of its product lines that are included in the Specialized Lending exposure class: Project Finance (assessed with the Project Finance Scorecard), Commercial Real Estate (assessed with the CRE investor & CRE Developer Scorecards) and Object Finance (assessed with the Object Finance Scorecard tailored for the Shipping portfolio).

In addition, the Group has developed an Unlikely to Pay/Impairment test. Unlikelinessto pay refersto circumstances when a Borrower is assessed as unlikely to pay its credit obligations in full without realization of collateral, regardless of the existence of any past due amount or of the days past due (i.e. to exposures less than 90 dpd). The impairment test , which is performed to all borrowers during every credit assessment is implemented in the RA platform and includes clearly defined indicators of unlikeliness to pay (UTP). These indicators are separated in "Hard" and "Soft" UTP triggers.

Hard UTP indicators lead directly to a recognition of non-performing (automatic NPE classification), as in most cases these events, by their very nature, directly fulfil the definition of UTP and there is little room for interpretation.
Soft UTP triggers when applied, do not automatically mean that an exposure is non-performing, but that a thorough assessment should be performed (assessment prior to NPE classification).

The Bank has further enhanced its wholesale credit risk assessment models linking risk parameters estimation with macro-economic factors allowing the forecasting of rating transitions under different macroeconomic scenarios (base, adverse and optimistic).

The rating systems described above are an integral part of the wholesale banking decision-making and risk management processes:

the credit approval or rejection, both at the origination and review process;
the allocation of competence levels for credit approval;
risk-adjusted pricing;
the calculation of Economic Value Added (EVA) and internal capital allocation; and
the impairment calculation (staging criteria and subsequent ECL estimation of forecasted risk parameters).

Rating of retail lending exposures

The Group assigns credit scores to its retail customers using a number of statistically-based models both at the origination and on ongoing basis through behavioral scorecards. These models have been developed to predict, on the basis of available information, the probability of default, the loss given default and the exposure at default. They cover the entire spectrum of retail products (credit cards, consumer lending, unsecured revolving credits, car loans, personal loans, mortgages and small business loans).

The Bank's models were developed based on historical data and credit bureau data. Behavioral scorecards are calculated automatically on a monthly basis, thus ensuring that the credit risk assessment is up to date.

The models are applied in the credit approval process, the credit limits management, as well as the collection process for the prioritization of the accountsin terms of handling. Furthermore, the models are often used for the risk segmentation of the customers and the risk based pricing of particular segments or new products introduced as well as in the calculation of the Economic Value Added (EVA) and Risk Adjusted Return on Capital (RaRoC) measures.

The rating systems employed by the Bank meets the requirements of the Basel III-Internal Ratings Based (IRB) approach. The Bank is IRB certified since 2008 for the Greek portfolios, both wholesale and retail (as detailed in Basel III, Pillar 3 disclosures available at the Bank's website).

In the context of IFRS9 implementation, the Bank hasfurther enhanced its retail credit risk assessment models linking risk parameters estimation with macro-economic factors allowing their forecasting over one year and lifetime horizon under different macroeconomic scenarios (base, adverse and optimistic) and supporting the staging analysis and allocation to risk classes under homogeneous pools.

The Group Credit Risk Capital Adequacy Control Sector monitors the capacity of rating models and scoring systems to classify customers according to risk, as well as to predict the probability of default and loss given default and exposure at default on an ongoing basis. The Group Models Validation and Governance Sector implements the Bank's validation policy which complies with international best practices and regulatory requirements. The Bank verifies the validity of the rating models and scoring systems on an annual basis and the validation includes both quantitative and qualitative aspects. The validation procedures are documented, and regularly reviewed and reported to the BRC.

The Group's Internal Audit Division also independently reviews the validation process in wholesale and retail rating systems annually.

(f) Credit risk mitigation

A key component of the Group's business strategy is to reduce risk by utilizing various risk mitigating techniques. The most important risk mitigating means are collaterals' pledges, guarantees and master netting arrangements.

Types of collateral commonly accepted by the Group

The Group hasinternal policiesin place which set out the following types of collateral that are usually accepted in a creditrelationship:

residential real estate, commercial real estate (offices, shopping malls, etc.), industrial buildings and land;
receivables (trade debtors) and post dated cheques;
securities, including listed shares and bonds;
deposits;
guarantees and letters of support;
insurance policies; and
equipment, mainly, vehicles and vessels.

A specific coverage ratio is pre-requisite, upon the credit relationship's approval and on ongoing basis, for each collateral type, as specified in the Group's credit policy.

For exposures, other than loans to customers (i.e. reverse repos, derivatives), the Group accepts as collateral only cash or liquid bonds.

Valuation principles of collaterals

In defining the maximum collateral ratio for loans, the Group considers all relevant information available, including the collaterals' specific characteristics, if market participants would take those into account when pricing the relevant assets. The valuation and hence eligibility is based on the following factors:

the collateral's fair value, i.e. the exit price that would be received to sell the asset in an orderly transaction under current market conditions;
the fair value reflects market participants' ability to generate economic benefits by using the asset in its highest and best use or by selling it;
a reduction in the collateral's value is considered if the type, location or condition (such as deterioration and obsolescence) of the asset indicate so; and
no collateral value is assigned if a pledge is not legally enforceable.

The Group performs collaterals' valuation in accordance with its processes and policies. With the exception of special cases (e.g. syndicated loans), the real estate collaterals of all units are valued by Cerved Property Services S.A. ("CPS") who is the successor of the Bank's former subsidiary, Eurobank Property Services S.A. CPS is regulated by the Royal Institute of Chartered Surveyors and employs internal or external qualified appraisers based on predefined criteria (qualifications and expertise). All appraisals take into account factorssuch asthe region, age and marketability of the property, and are further reviewed and countersigned by experienced staff. The valuation methodology employed is based on International Valuation Standards (IVS), while quality controls are in place, such as reviewing mechanisms, independent sample reviews by independent well established valuation companies.

In order to monitor the valuation of residential property held as collateral, the Bank uses the Residential Property Index developed in collaboration with other major banks in Greece. This methodology, has been approved by the Bank of Greece, and its use enables a dynamic monitoring of residential properties' values and market trends, on an annual basis. The Residential Property Index is used in combination with physical inspection and desktop valuation, depending on the EBA status and the balance of the loan.

For commercial real estates, the Bank uses the Commercial Real Estate Index developed by CPS. This index is based on internationally accepted methodology and constitutes a tool for the statistical monitoring of possible changes of the values of the commercial properties as well as for the trends in the particular market. It is updated on an annual basis. The Commercial Real Estate Index is used in combination with physical inspection and desktop valuation, depending on the EBA status and the balance of the loan.

To ensure the quality of the post-dated cheques accepted as collateral, the Bank has developed a pre-screening system, which takes into account a number of criteria and risk parameters, so as to evaluate their eligibility. Furthermore, the post-dated cheques' valuation is monitored through the use of advanced statistical reports and through the review of detailed information regarding the recoverability of cheques, referrals and bounced cheques, per issuer broken down.

Collateral policy and documentation

Regarding collaterals, Group's policy emphasizes the need that collaterals and relevant processes are timely and prudently executed, in order to ensure that collaterals and relevant documentation are legally enforceable at any time. The Group holds the right to liquidate collateral in the event of the obligor'sfinancial distress and can claim and control cash proceedsfrom the liquidation process.

Guarantees

The guarantees used as credit risk mitigation by the Group are largely issued by central and regional governments in the countries in which it operates. The Hellenic Development Bank (HDB) and similar funds, banks and insurance companies are also significant guarantors of credit risk.

Management of repossessed properties

The objective of the repossessed assets' management is to minimize the time cycle of the asset's disposal and to maximize the recovery of the capital engaged.

To this end, the management of repossessed assets aims at improving rental and other income from the exploitation of such assets, and at the same time reducing the respective holding and maintenance costs. Additionally, the Group is actively engaged in identifying suitable potential buyers for its portfolio of repossessed assets (including specialized funds involved in acquiring specific portfolios of properties repossessed), both in Greece and abroad, in order to reduce its stock of properties with a time horizon of 3-5 years.

Repossessed assets are closely monitored based on technical and legal due diligence reports, so that their market value is accurately reported and updated in accordance with market trends.

Counterparty risk

The Group mitigates counterparty risk arising from treasury activities by entering into master netting arrangements and similar agreements, as well as collateral agreements with counterparties with which it undertakes a significant volume of transactions. Master netting arrangements do not generally result in the offset of balance sheet assets and liabilities, asthe transactions are usually settled on a gross basis. However, the respective credit risk is reduced through a master netting agreement to the extent that if an event of default occurs, all amounts with the counterparty are terminated and settled on a net basis.

In the case of derivatives, the Group makes use of International Swaps and Derivatives Association (ISDA) contracts, which limit the exposure via the application of netting, and Credit Support Annex (CSAs), which further reduce the total exposure with the

counterparty. Under these agreements, the total exposure with the counterparty is calculated on a daily basis taking into account any netting arrangements and collaterals.

The same process is applied in the case of repo transactions where standard Global Master Repurchase Agreements (GMRAs) are used. The exposure (the net difference between repo cash and the market value of the securities) is calculated on a daily basis and collateral is transferred between the counterparties thus minimizing the exposure.

Following the European Market Infrastructure Regulation (EMIR), the Bank performs centrally cleared transactions for eligible derivative contracts through an EU authorized European central counterparty (CCP), recorded in trade repositories. The use of CCP increases market transparency and reduces counterparty credit and operational risks inherent in derivatives markets.

The Bank uses a comprehensive collateral management system for the monitoring of ISDA, CSAs and GMRAs, i.e. the daily valuation of the derivatives and the market value of the securities are used for the calculation of each counterparty's exposure. The collateral which should be posted or requested by the relevant counterparty is calculated daily.

With this system, the Bank monitors and controls the collateral flow in case of derivatives and repos, independently of the counterparty. The effect of any market movement that increases the Bank's exposure is reported and the Bank proceeds to collateral call accordingly.

5.2.1.1 Maximum exposure to credit risk before collateral held

	2020		2019
	€ million		€ million
Credit risk exposures relating to on-balance sheet assets are as
follows:
Due from credit institutions	3,337		3,008
Less: Impairment allowance	(1)	3,336	(1)	3,007
Debt securities held for trading		42		53
Derivative financial instruments		2,552		2,262
Loans and advances to customers at amortised cost:
- Wholesale lending⁽¹⁾	21,340		20,106
- Mortgage lending	11,650		13,982
- Consumer lending	3,408		3,838
- Small business lending	4,476		6,480
Less: Impairment allowance	(3,477)	37,397	(7,099)	37,307
Loans and advances to customers measured at FVTPL		27		58
Investment securities:
- Debt securities measured at amortised cost	2,789		1,542
Less: Impairment allowance	(5)	2,784	(3)	1,539
Debt securities measured at FVOCI		5,454		6,278
Investment securities at FVTPL		127		134
Other financial assets⁽²⁾	137		111
Less: Impairment allowance	(30)	107	(26)	85
Credit risk exposures relating to off-balance sheet items (note 42):
- Loan commitments		4,586		4,095
- Financial guarantee contracts and other commitments		1,125		1,230
Total		57,537		56,048

(1) Includes loans to public sector.

(2) Refers to financial assets subject to IFRS 9 impairment requirements, which are recognised within other assets.

The above table represents the Group's maximum credit risk exposure as at 31 December 2020 and 31 December 2019 respectively, without taking account of any collateral held or other credit enhancements that do not qualify for offset in the Group's financial statements.

For on-balance sheet assets, the exposures set out above are based on the carrying amounts as reported in the balance sheet. For off-balance sheet items, the maximum exposure is the nominal amount that the Group may be required to pay if the financial guarantee contracts and other commitments are called upon and the loan commitments are drawn down. Off-balance sheet loan commitments presented above, include revocable commitments to extend credit of € 3.4 billion (2019: € 3 billion) that are subject to ECL measurement.

5.2.1.2 Loans and advances to customers

The section below provides an overview of the Group's exposure to credit risk arising from its customer lending portfolios, in line with the guidelines set by the Hellenic Capital Markets Commission and the Bank of Greece (BoG) released on 30 September 2013, as updated by the Group in order to comply with the revised IFRS 7 'Financial Instruments: Disclosures', following the adoption of IFRS 9 from 2018. In addition, the types of the Group's forbearance programs are in line with the BoG's Executive Committee Act 42/30.05.2014 and its amendments.

(a) Credit quality of loans and advances to customers

Loans and advances to customers carried at amortised cost are classified depending on how ECL is measured.

Accordingly, loans reported as non-impaired include loans for which a '12-month ECL allowance' is recognized as they exhibit no significant increase in credit risk since initial recognition and loans for which a 'Lifetime ECL allowance' is recognized as they exhibit a significant increase in credit risk since initial recognition but are not considered to be in default.

Credit impaired loans category includes loans that are considered to be in default, for which a loss allowance equal to 'Lifetime ECL' is recognized and loans classified as 'Purchased or originated credit impaired' (POCI) which are always measured on the basis of 'lifetime ECL'.

Loans and advances to customers carried at FVTPL are not subject to ECL measurement and therefore are not included in the quantitative information provided in the below sections for loans and advances measured at amortised cost, except where indicated.

The Group's accounting policy regarding impairment of financial assets is set out in note 2.2.13.

Regulatory definitions

'Default exposures', in line with the regulatory definition of default as adopted by the Group, include material exposures that are past due more than 90 days, exposures that are assessed by the Group as unlikely to pay as well as those that are assessed for impairment individually and carry an individual impairment allowance. As at 31 December 2020, the Group's default exposures amounted to € 5,231 million (2019: € 12,295 million).

'Non-performing exposures' as currently monitored and reported by the Group, in line with the guidelines set by the European Banking Authority (EBA Implementing Technical Standards), include material exposures that are in arrears for more than 90 days or assessed as unlikely to pay, impaired exposures under individual or collective impairment assessment, exposures categorized as defaulted for regulatory purposes, as well as forborne non performing exposures. As at 31 December 2020, the Group's non performing exposures included in loans and advances to customers at amortised cost amounted to € 5,724 million (2019: € 12,950 million). Correspondingly, 'Performing exposures' include exposures without arrears, those that are less than 90 days past due or are not assessed as unlikely to pay, non-impaired and non-defaulted exposures. As at 31 December 2020, the Group's performing exposures included in loans and advances to customers at amortised cost amounted to € 35,150 million (2019: € 31,456 million).

'Unlikely to pay' category refers to exposures where a borrower's ability to repay his credit obligations in full without realization of collateral is assessed as unlikely, regardless the existence of any past due amounts or the number of days past due.

The new definition of default (DoD) for regulatory purposes introduced a new set of standards that will have a significant impact on governance, data, processes, systems and credit models. The new DoD is applicable from 1 January 2021 and is set in the Article 178 of Regulation (EU) No. 575/2013, the Commission Delegated Regulation (EU) 2018/171 and European Banking Authority (EBA) Guidelines (EBA/GL/2016/07). It aims at the harmonization of the definition of default across institutions and jurisdictions in the European Union. In particular, the new DoD guidelines specify that days past due are counted from the date that both materiality thresholds are breached (an absolute amount of the total exposure and a relative as a percentage of the exposure), include conditions for a return to non-defaulted status (introduction of a probation period) and explicit criteria for classification of restructured loans as defaulted when the diminished financial obligation criterion issatisfied (difference between the net present value of cash flows before and after the restructuring exceeds the threshold of 1%).

The Group will apply the above new provisions of DoD, in order to identify defaulted exposures starting from 1 January 2021, consistently across all its lending portfolios and subsidiaries, subject to local regulations and specific credit risk characteristics of each jurisdiction. Accordingly, the definition of default for accounting purposes will be aligned with the new DoD, that will be also be the one used for internal credit risk management purposes. The impact in the Group's Excepted Credit Loss from the implementation of the new definition of default is not estimated to be material.

Quantitative information

The following tables present the total gross carrying and nominal amount, representing the maximum exposure to credit risk before the impairment allowance, of loans and advances including securitized notes issued by special purpose vehicles established by the Group and credit related commitments respectively, that are classified as non-impaired (stage 1 and stage 2) and those classified as credit-impaired (stage 3 and POCI). They also present the impairment allowance recognized in respect of all loans and advances and credit related commitments, analyzed into individually or collectively assessed, based on how the respective impairment allowance has been calculated, the carrying amount of loans and advances, as well as the value of collateral held to mitigate credit risk.

Public Sector lending exposures include exposures to the central government, local authorities, state-linked companies and entities controlled and fully or partially owned by the state, excluding public and private companies with commercial activity. For credit risk management purposes, exposures to Public Sector are incorporated in wholesale lending.

In addition, the value of collateral presented in the tables below is capped to the respective gross loan amount.

EUROBANK ERGASIAS SERVICES and HOLDINGS S.A.

Notes to the Consolidated Financial Statements

The following tables present information about the credit quality of the gross carrying amount of loans and advances to customers carried at amortised cost, the nominal exposure of credit related commitments and the respective impairment allowance as well as the carrying amount of loans and advances to customers carried at FVTPL:

	31 December 2020
							Impairment allowance
			Lifetime ECL credit-impaired⁽¹⁾					Lifetime ECL credit-impaired⁽¹⁾
	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Individually assessed	Collectively assessed	Total gross carrying amount/nominal exposure	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Individually assessed	Collectively assessed	Carrying amount	Value of collateral
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Retail Lending	11,511	4,425	334	3,265	19,534	(100)	(332)	(184)	(1,619)	17,299	12,968
- Mortgage	7,081	2,791	176	1,603	11,650	(24)	(152)	(94)	(571)	10,809
Value of collateral	6,469	2,286	122	1,219							10,096
- Consumer	1,606	377	2	553	2,538	(21)	(53)	(1)	(460)	2,003
Value of collateral	93	3	2	93							191
- Credit card	624	69	0	177	870	(20)	(8)	(0)	(157)	685
Value of collateral	1	0	0	0							1
- Small business	2,200	1,189	155	932	4,476	(35)	(119)	(90)	(431)	3,802
Value of collateral	1,249	793	96	543							2,681
Wholesale Lending	17,180	1,995	1,509	614	21,298	(82)	(107)	(741)	(310)	20,058	13,950
- Large corporate	10,821	997	587	43	12,447	(60)	(44)	(274)	(20)	12,049
Value of collateral	5,995	749	384	23							7,151
- SMEs	2,861	998	922	572	5,353	(22)	(63)	(467)	(291)	4,511
Value of collateral	1,797	705	518	280							3,301
- Securitized notes⁽²⁾	3,498	-	-	-	3,498	(0)	-	-	-	3,498
Value of collateral	3,498	-	-	-							3,498
Public Sector	24	17	-	2	42	(1)	(1)	-	(1)	40	2
- Greece	22	17	-	1	40	(1)	(1)	-	(1)	38
Value of collateral	1	1	-	0							2
- Other countries	1	-	-	1	2	(0)	-	-	(0)	2
Value of collateral Loans and advances to customers at FVTPL	0	-	-	-	-					27	0 27
Total	28,714	6,436	1,843	3,881	40,874	(183)	(439)	(925)	(1,930)	37,424	26,947
Total value of collateral	19,103	4,537	1,121	2,159

Credit related commitments	5,238	418	33	23	5,712	(32)	(7)	(21)	(6)
Loan commitments	4,292	289	3	2	4,586	(24)	(4)	-	(0)
Financial guarantee contracts and other commitments	946	129	30	21	1,126	(8)	(2)	(21)	(6)
Value of collateral	431	44	5	7

	Lifetime ECL credit-impaired⁽¹⁾					Lifetime ECL credit-impaired⁽¹⁾
					Total gross carrying
	12-month ECL	Lifetime ECL	Individually	Collectively	amount/nominal	12-month ECL	Lifetime ECL	Individually	Collectively	Carrying	Value of
	-Stage 1	-Stage 2	assessed	assessed	exposure	-Stage 1	-Stage 2	assessed	assessed	amount	collateral
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Retail Lending	11,545	4,449	561	7,745	24,300	(72)	(317)	(301)	(3,756)	19,854	15,452
- Mortgage	6,980	3,129	262	3,611	13,982	(13)	(174)	(130)	(1,387)	12,278
Value of collateral	6,306	2,538	153	2,341							11,338
- Consumer	1,555	324	1	951	2,831	(18)	(39)	(0)	(801)	1,973
Value of collateral	86	7	1	121							215
- Credit card	742	65	0	200	1,007	(19)	(5)	(0)	(173)	810
Value of collateral	1	0	0	-							1
- Small business	2,268	931	298	2,983	6,480	(22)	(99)	(171)	(1,395)	4,793
Value of collateral	1,497	640	156	1,605							3,898
Wholesale Lending	13,606	1,799	3,368	1,274	20,047	(63)	(90)	(1,828)	(670)	17,396	11,802
- Large corporate	9,515	996	1,567	74	12,152	(43)	(44)	(785)	(34)	11,246
Value of collateral	5,058	810	925	31							6,824
- SMEs	3,033	803	1,801	1,200	6,837	(20)	(46)	(1,043)	(636)	5,092
Value of collateral	2,037	574	857	452							3,920
- Securitized notes⁽²⁾	1,058	-	-	-	1,058	(0)	-	-	-	1,058
Value of collateral	1,058	-	-	-							1,058
Public Sector	54	3	-	2	59	(1)	(0)	-	(1)	57	2
- Greece	44	3	-	1	48	(1)	(0)	-	(1)	46
Value of collateral	1	1	-	0							2
- Other countries	10	-	-	1	11	(0)	-	-	(0)	11
Loans and advances to
customers at FVTPL										58	58
Total	25,205	6,251	3,929	9,021	44,406	(136)	(407)	(2,129)	(4,427)	37,365	27,314
Total value of collateral	16,044	4,570	2,092	4,550
Credit related commitments	4,935	284	77	29	5,325	(25)	(2)	(31)	(6)
Loan commitments	3,956	131	8	0	4,095	(20)	(1)	(0)	(0)
Financial guarantee contracts
and other commitments	979	153	69	29	1,230	(5)	(1)	(31)	(6)
Value of collateral	417	55	6	4

31 December 2019

Impairment allowance

(1) As at 31 December 2020, total gross carrying amount of credit impaired loans includes POCI loans of € 43 million which carry an impairment allowance of € 3.5 million (2019: € 54 million gross carrying amount, of which € 49 million arose from the acquisition of Piraeus Bank Bulgaria and € 3.5 million impairment allowance, note 23).

(2) It refers to the senior notes of the Pillar and Cairo securitizations that are collateralized by the underlying pool of loans held by the respective securitization vehicles (note 20). The amount of the securitized loan portfolios has been capped to the gross carrying amount of the senior notes. In addition, the senior notes of the Cairo securitization are guaranteed by the Hellenic Republic in the context of Hellenic Asset Protection Scheme (note 34).

The Group assesses the credit quality of its loans and advances to customers and credit related commitments that are subject to ECL using internal credit rating systems for the wholesale portfolio, which are based on a variety of quantitative and qualitative factors, while the credit quality of the retail portfolio is based on the allocation of risk classes into homogenous pools.

The following tables present the distribution of the gross carrying amount of loans and advances and the nominal exposure of credit related commitments based on the credit quality classification categories and stage allocation:

		31 December 2020				31 December 2019
				Total gross			Lifetime ECL	Total gross
Internal credit rating	12-month ECL	Lifetime ECL	Lifetime ECL	carrying	12-month ECL -	Lifetime ECL -	credit -	carrying
	Stage 1	Stage 2	credit-impaired	amount	Stage 1	Stage 2	impaired	amount
Retail Lending	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
- Mortgage
PD<2.5%	6,442	190	-	6,632	6,422	622	-	7,044
2.5%<=PD<4%	193	318	-	510	331	396	-	727
4%<=PD<10%	217	545	-	761	193	767	-	960
10%<=PD<16%	109	250	-	359	22	262	-	284
16%<=PD<99.99%	121	1,488	-	1,609	12	1,082	-	1,094
100%	-	-	1,779	1,779	-	-	3,873	3,873
- Consumer
PD<2.5%	761	12	-	774	761	14	-	775
2.5%<=PD<4%	577	18	-	594	541	34	-	575
4%<=PD<10%	247	97	-	344	253	105	-	358
10%<=PD<16%	11	56	-	67	0	68	-	68
16%<=PD<99.99%	10	193	-	203	0	103	-	103
100%	-	-	555	555	-	-	952	952
- Credit card
PD<2.5%	41	5	-	46	47	6	-	53
2.5%<=PD<4%	162	2	-	163	196	3	-	199
4%<=PD<10%	385	17	-	402	499	36	-	535
10%<=PD<16%	32	20	-	51	0	3	-	3
16%<=PD<99.99%	5	25	-	30	0	17	-	17
100%	-	-	177	177	-	-	200	200
- Small business
PD<2.5%	194	19	-	213	239	4	-	243
2.5%<=PD<4%	943	14	-	957	1,212	21	-	1,233
4%<=PD<10%	579	44	-	623	674	189	-	863
10%<=PD<16%	166	59	-	225	143	196	-	339
16%<=PD<99.99%	318	1,053	-	1,370	0	521	-	521
100%	-	-	1,087	1,087	-	-	3,281	3,281
Wholesale Lending
- Large corporate
Strong	5,362	139	-	5,501	6,139	152	-	6,291
Satisfactory	5,140	519	-	5,659	3,062	515	-	3,577
Watch list	320	339	-	659	314	329	-	643
Impaired					-	-	1,641	1,641
(Defaulted)	-	-	629	629
- SMEs
Strong	1,301	69	-	1,370	1,354	51	-	1,405
Satisfactory	1,406	377	-	1,783	1,501	245	-	1,746
Watch list	154	552	-	706	178	507	-	685
Impaired					-	-	3,001	3,001
(Defaulted)	-	-	1,494	1,494
- Securitized notes
Strong	3,498	-	-	3,498	1,058	-	-	1,058
Public Sector
All countries
Strong	1	-	-	1	1	-	-	1
Satisfactory	22	-	-	22	53	-	-	53
Watch list	1	17	-	18	-	3	-	3
Impaired					-	-	2	2
(Defaulted)	-	-	2	2
Total	28,714	6,436	5,724	40,874	25,205	6,251	12,950	44,406

		31 December 2020			31 December 2019
Internal credit rating	12-month ECL Stage 1 € million	Lifetime ECL Stage 2 € million	Lifetime ECL credit-impaired € million	Total nominal amount € million	12-month ECL Stage 1 € million	Lifetime ECL Stage 2 € million	Lifetime ECL credit-impaired € million	Total nominal amount € million
Credit Related
Commitments
Retail Lending Loan commitments
PD<2.5%	267	5	-	272	257	6	-	263
2.5%<=PD<4%	635	8	-	642	646	2	-	648
4%<=PD<10%	1,495	110	-	1,605	1,405	65	-	1,470
10%<=PD<16%	240	17	-	257	166	4	-	170
16%<=PD<99.99%	23	56	-	79	0	10	-	10
100%	-	-	2	2	-	-	0	0
Financial guarantee contracts and other
commitments
PD<2.5%	7	0	-	7	13	0	-	13
2.5%<=PD<4%	57	-	-	57	93	-	-	93
4%<=PD<10%	70	0	-	70	40	0	-	40
10%<=PD<16%	-	-	-	-	-	0	-	0
16%<=PD<99.99%	0	0	-	0	-	0	-	0
100%	-	-	0	0	-	-	0	0
Wholesale Lending Loan commitments
Strong	906	37	-	944	900	6	-	906
Satisfactory	713	23	-	736	572	34	-	606
Watch list	13	33	-	45	10	4	-	14
Impaired (Defaulted) Financial guarantee	-	-	3	3	-	-	8	8
contracts and other commitments
Strong	406	3	-	409	523	2	-	525
Satisfactory	313	59	-	372	298	85	-	383
Watch list	93	67	-	160	12	66	-	78
Impaired (Defaulted)	-	-	51	51	-	-	98	98
Total	5,238	418	56	5,712	4,935	284	106	5,325

The table below depicts the internal credit rating bands (MRA rating scale or equivalent) for the wholesale portfolio that correspond to the credit quality classification categories presented in the above tables:

Wholesale Lending
Credit Quality classification categories	Internal Credit Rating
Strong	1-4
Satisfactory	5-6
Watch list	7-9
Impaired (Defaulted)	10

The following tables present the movement of the gross carrying amounts for loans and advances to customers by product line and stage and is calculated by reference to the opening and closing balances for the reporting years from 1 January 2020 to 31 December 2020 and 1 January 2019 to 31 December 2019:

	31 December 2020
		Wholesale			Mortgage		Consumer				Small business
	Lifetime ECL		Lifetime ECL		Lifetime ECL			Lifetime ECL
	12-month	Lifetime ECL	credit	12-month	Lifetime ECL	credit	12-month	Lifetime ECL	credit	12-month	Lifetime ECL	credit
	ECL-Stage 1	Stage 2	impaired	ECL-Stage 1	Stage 2	impaired	ECL-Stage 1	Stage 2	impaired	ECL-Stage 1	Stage 2	impaired	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million		€ million € million
Gross carrying amount at
1 January	13,660	1,802	4,644	6,980	3,129	3,873	2,297	389	1,152	2,268	931	3,281	44,406
New loans and advances
originated or purchased Securitized notes	3,809 2,440	- -	- -	468 -	- -	- -	521 -	- -	- -	814 -	- -	- -	5,612 2,440
Transfers between stages
-to 12-month ECL	272	(271)	(0)	779	(771)	(8)	76	(72)	(4)	114	(112)	(2)	-
-to lifetime ECL	(872)	899	(27)	(539)	842	(303)	(172)	218	(46)	(413)	496	(83)	-
-to lifetime ECL credit
impaired loans	(57)	(251)	308	(38)	(149)	188	(41)	(51)	92	(31)	(57)	88	-
Loans and advances
derecognised/
reclassified as held for
sale during the year	(142)	(41)	(2,459)	(24)	(184)	(1,910)	(61)	(14)	(310)	(76)	(109)	(2,183)	(7,512)
Amounts written-off⁽¹⁾	-	-	(220)	-	-	(97)	-	-	(131)	-	-	(103)	(551)
Repayments	(1,838)	(174)	(93)	(663)	(109)	(52)	(308)	(39)	(33)	(217)	(66)	(36)	(3,628)
Foreign exchange
differences and other
movements	(68)	48	(28)	118	32	88	(83)	14	14	(259)	106	126	107
Gross Carrying amount
at 31 December	17,204	2,012	2,125	7,081	2,791	1,779	2,230	445	732	2,200	1,189	1,087	40,874
Impairment allowance	(83)	(108)	(1,052)	(24)	(152)	(665)	(41)	(61)	(617)	(35)	(119)	(520)	(3,477)
Carrying amount at 31
December	17,121	1,904	1,073	7,056	2,638	1,114	2,189	384	115	2,165	1,070	567	37,397

	31 December 2019
		Wholesale			Mortgage		Consumer				Small business
	12-month		Lifetime ECL	12-month		Lifetime ECL	12-month		Lifetime ECL	12-month		Lifetime ECL
	ECL	Lifetime ECL	credit	ECL	Lifetime ECL	credit	ECL	Lifetime ECL	credit	ECL	Lifetime ECL	credit
	-Stage 1	-Stage 2	impaired	-Stage 1	-Stage 2	impaired	-Stage 1	-Stage 2	impaired	-Stage 1	-Stage 2	impaired	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million		€ million € million
Gross carrying amount at
1 January	10,824	1,881	5,597	6,706	3,513	6,043	2,225	359	1,404	1,604	1,208	3,609	44,973
New loans and advances
originated or purchased	3,070	-	-	374	-	-	561	-	-	332	-	-	4,337
Arising from acquisition
(note 23)	429	-	65	116	-	7	75	-	0	36	-	1	729
Securitized notes	1,058	-	-	-	-	-	-	-	-	-	-	-	1,058
Transfers between stages
-to 12-month ECL	212	(199)	(13)	668	(657)	(11)	107	(104)	(3)	505	(502)	(3)	-
-to lifetime ECL	(563)	740	(177)	(239)	783	(544)	(195)	260	(65)	(70)	395	(325)	-
-to lifetime ECL credit
impaired loans	(112)	(91)	203	(58)	(365)	423	(45)	(67)	112	(27)	(139)	166	-
Loans and advances
derecognised/
reclassified as held for
sale during the year	(180)	(9)	(85)	(7)	(93)	(1,898)	(105)	(15)	(2)	(28)	(2)	(2)	(2,426)
Amounts written-off⁽¹⁾	-	-	(514)	-	-	(144)	-	-	(264)	-	-	(161)	(1,083)
Repayments	(1,348)	(492)	(321)	(679)	(143)	(85)	(303)	(41)	(58)	(214)	(55)	(51)	(3,790)
Foreign exchange
differences and other
movements	270	(28)	(111)	99	91	82	(23)	(3)	28	130	26	47	608
Gross Carrying amount at
31 December	13,660	1,802	4,644	6,980	3,129	3,873	2,297	389	1,152	2,268	931	3,281	44,406
Impairment allowance	(64)	(90)	(2,499)	(13)	(174)	(1,517)	(37)	(44)	(974)	(22)	(99)	(1,566)	(7,099)
Carrying amount at 31
December	13,596	1,712	2,145	6,967	2,955	2,356	2,260	345	178	2,246	832	1,715	37,307

(1) The contractual amount outstanding on lending exposures that were written off during the year ended 31 December 2020 and that are still subject to enforcement activity is € 503 million (2019: € 927 million).

Note 1: Wholesale product line category includes also Public sector loans portfolio.

Note 2: "Loans and advances derecognised/ reclassified as held for sale during the year" presents loans derecognized during the year due to a) securitization/ sale transactions (note 20) and b) substantial modifications of the loans' contractual terms and those that have been reclassified as held for sale during the year (note 30).

Credit impaired loans and advances to customers

The following tables present the ageing analysis of credit impaired (Stage 3 and POCI) loans and advances by product line at their gross carrying amounts, as well as the respective impairment allowance and the value of collaterals held to mitigate credit risk.

For denounced loans, the Group ceases to monitor the delinquency status and therefore the respective balances have been included in the 'over 360 days' time band, with the exception of consumer exposures which continue to be monitored up to 360 days past due.

	31 December 2020
	Retail lending Wholesale lending Small Large Mortgage Consumer Credit card business corporate SMEs € million € million € million € million € million € million						Public sector Greece and other countries € million	Lifetime ECL credit-impaired € million
up to 90 days	541	79	23	228	218	305	-	1,393
90 to 179 days	48	26	8	28	21	53	-	184
180 to 360 days	56	32	17	18	4	78	-	205
more than 360 days	1,134	418	129	814	387	1,058	2	3,942
Total gross carrying amount	1,779	555	177	1,087	629	1,494	2	5,724
Impairment allowance	(665)	(461)	(157)	(520)	(294)	(757)	(1)	(2,855)
Carrying amount	1,114	94	21	567	336	737	1	2,869
Value of Collateral	1,341	95	0	638	407	798	0	3,280

	31 December 2019
		Retail lending				Wholesale lending	Public sector
	Mortgage € million	Consumer € million	Credit card € million	Small business € million	Large corporate € million	SMEs € million	Greece € million	Lifetime ECL credit-impaired € million
up to 90 days	850	118	25	362	551	515	-	2,421
90 to 179 days	124	34	11	65	105	58	-	397
180 to 360 days	111	40	12	69	37	46	-	315
more than 360 days	2,788	760	152	2,785	948	2,382	2	9,817
Total gross carrying amount	3,873	952	200	3,281	1,641	3,001	2	12,950

Impairment allowance	(1,517)	(801)	(173)	(1,566)	(819)	(1,679)	(1)	(6,556)
Carrying amount	2,356	151	27	1,715	822	1,322	1	6,394
Value of Collateral	2,494	122	0	1,761	956	1,309	0	6,642

Note: As at 31 December 2020, total gross carrying amount of credit impaired loans includes POCI loans of € 43 million (2019: € 54 million).

(b) Collaterals and repossessed assets

Collaterals

The Loan-to-Value (LTV) ratio of the mortgage lending reflects the gross loan exposure at the balance sheet date over the market value of the property held as collateral.

The LTV ratio of the mortgage portfolio is presented below:

	2020 € million	2019 € million
Mortgages
Less than 50%	2,745	3,407
50%-70%	2,096	2,300
71%-80%	1,483	1,505
81%-90%	1,104	1,139
91%-100%	1,589	2,072
101%-120%	863	1,023
121%-150%	705	887
Greater than 150%	1,065	1,649
Total exposure	11,650	13,982
Average LTV	69.25%	76.79%

The breakdown of collateral and guarantees for loans and advances to customers at amortised cost is presented below:

		31 December 2020
		Value of collateral received
	Real Estate	Guarantees Financial Other Total
	€ million	€ million	€ million	€ million	€ million
Retail Lending	12,641	97	230	12,968	15
Wholesale Lending⁽¹⁾	5,107	933	7,910	13,950	356
Public sector	1	1	0	2	-
Total	17,750	1,031	8,140	26,920	371

		Guarantees
	Real Estate	Financial Other Total
	€ million	€ million	€ million	€ million	€ million
Retail Lending	14,825	423	204	15,452	291
Wholesale Lending ⁽¹⁾	5,517	879	5,406	11,802	180
Public sector	1	1	0	2	-
Total	20,343	1,303	5,610	27,256	471

(1) Other collaterals include assigned receivables, equipment, inventories, vessels, etc. They also include the amount of the securitized loans held by the securitizations vehicles that issued the Pillar and Cairo senior notes. The amount of the securitized loans has been capped to the gross carrying amount of the senior notes. In addition, the senior notes of the Cairo securitization are guaranteed by the Hellenic Republic in the context of Hellenic Asset Protection Scheme (note 34).

Repossessed assets

The Group recognizes collateral assets on the balance sheet by taking possession usually through legal processes or by calling upon other credit enhancements. The main type of collateral that the Group repossesses againstrepayment or reduction of the outstanding loan is real estate, which is recognized within repossessed assets and carried at the lower of cost or net realizable value (see also notes 2.2.18 and 29). In cases where the Group makes use of repossessed properties as part of its operations, they are classified as own-used or investment properties, as appropriate (notes 2.2.6, 26 and 27).

The following tables present a summary of collaterals that the Group took possession, and were recognized as repossessed assets, as well as the net gains/ (losses) arising from the sale of such assets in the year:

				31 December 2020
	Gross amount € million	Of which: added this year € million	Accumulated impairment € million	Of which: arising this year € million	Net amount € million	Net Sale Price € million	Net gain/(loss) on sale € million
Real estate auction items	753	80	(168)	16	585	16	1
- Residential	249	33	(41)	8	208	9	1
- Commercial	504	47	(127)	8	377	7	0
Other collateral	1	0	(0)	-	1	-	-
	31 December 2019
		Of which:		Of which:			Net
	Gross	added this	Accumulated	arising this	Net	Net	gain/(loss)
	amount	year	impairment	year	amount	Sale Price	on sale
	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Real estate auction items	719	178	(183)	5	536	39	1
- Residential	255	46	(49)	14	206	15	(0)
- Commercial	464	132	(134)	(9)	330	24	1
Other collateral	1	-	(0)	-	1	1	0

Propertiesthat have been classified asinvestment property in 2020 as a result ofrepossession or transfer from repossessed properties category, amounted to € 2 million (2019: € 55 million).

(c) Geographical and industry concentrations of loans and advances to customers

As described above in note 5.2.1, the Group holds diversified portfolios across markets and countries and implements limits on concentrations arising from the geographical location or the activity of groups of borrowersthat could be similarly affected by changes in economic or other conditions, in order to mitigate credit risk.

The following tables break down the Group's exposure into loans and advances to customers and credit related commitments at their gross carrying amount and nominal amount respectively by stage, product line, industry and geographical region and impairment allowance by product line, industry and geographical region:

	31 December 2020
		Greece				Rest of Europe			Other Countries
	Gross carrying/nominal amount				Gross carrying/nominal amount				Gross carrying/nominal amount
	12-month ECL -Stage 1	Lifetime ECL -Stage 2	Lifetime ECL credit impaired⁽¹⁾	Impairment allowance	12-month ECL -Stage 1	Lifetime ECL -Stage 2	Lifetime ECL credit impaired⁽¹⁾	Impairment allowance	12-month ECL -Stage 1	Lifetime ECL -Stage 2	Lifetime ECL credit impaired⁽¹⁾	Impairment allowance
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Retail Lending	8,954	4,080	3,306	(2,073)	2,548	345	292	(161)	9	0	1	(0)
-Mortgage -Consumer	5,760 801	2,659 248	1,615 503	(779) (485)	1,313 804	132 129	163 52	(62) (49)	7 1	0 0	1 0	(0) (0)
-Credit card	535	46	173	(180)	88	22	5	(4)	0	0	0	(0)
-Small business	1,858	1,127	1,016	(628)	342	62	71	(46)	0	0	-	(0)
Wholesale Lending	8,209	1,303	1,761	(1,056)	6,767	678	326	(158)	2,204	14	36	(26)
-Commerce and services⁽²⁾	3,415	495	980	(587)	4,301	96	119	(83)	443	0	20	(15)
-Manufacturing	2,396	312	292	(198)	573	81	27	(13)	-	-	-	-
-Shipping	7	3	50	(47)	199	-	18	(14)	1,589	4	16	(11)
-Construction	758	144	226	(118)	483	33	31	(20)	67	7	0	(0)
-Tourism	971	339	207	(91)	190	86	18	(2)	-	-	-	-
-Energy	641	5	1	(5)	180	20	18	(2)	-	-	-	-
-Other	21	5	4	(8)	841	362	96	(23)	105	2	-	(0)
Public Sector	22	17	1	(2)	1	-	1	(0)	-	-	-	-
Total	17,185	5,399	5,068	(3,131)	9,316	1,023	619	(320)	2,213	14	37	(26)
Credit related
Commitments	3,428	307	52	(62)	1,741	93	4	(4)	69	18	0	(0)
-Loan commitments	2,853	206	1	(26)	1,373	80	3	(2)	66	2	0	(0)
-Financial guarantee contracts and other commitments	575	101	50	(35)	368	13	1	(2)	3	16	0	(0)

					31 December 2019
		Greece				Rest of Europe			Other Countries
	Gross carrying/nominal amount					Gross carrying/nominal amount			Gross carrying/nominal amount
	12-month ECL	Lifetime ECL	Lifetime ECL credit	Impairment	12-month ECL	Lifetime ECL	Lifetime ECL credit	Impairment	12-month ECL	Lifetime ECL	Lifetime ECL credit	Impairment
	-Stage 1 € million	-Stage 2 € million	impaired⁽¹⁾ € million	allowance € million	-Stage 1 € million	-Stage 2 € million	impaired⁽¹⁾ € million	allowance € million	-Stage 1 € million	-Stage 2 € million	impaired⁽¹⁾ € million	allowance € million
Retail Lending	9,202	4,176	7,954	(4,272)	2,336	273	351	(174)	7	0	1	(0)
-Mortgage	5,786	3,008	3,676	(1,627)	1,188	121	196	(77)	6	0	1	(0)
-Consumer	839	233	907	(820)	715	91	45	(38)	1	0	0	(0)
-Credit card	644	46	196	(193)	98	19	4	(4)	0	0	0	(0)
-Small business	1,933	889	3,175	(1,632)	335	42	106	(55)	0	-	-	(0)
Wholesale Lending	7,459	1,381	4,085	(2,344)	4,311	379	482	(272)	1,836	39	75	(35)
-Commerce and services⁽²⁾	2,942	448	1,943	(1,159)	1,836	57	204	(145)	321	0	33	(18)
-Manufacturing	2,136	267	827	(484)	537	59	17	(8)	12	-	-	(0)
-Shipping	176	5	10	(9)	135	-	62	(57)	1,360	39	24	(7)
-Construction	697	325	884	(529)	424	31	59	(34)	30	-	18	(10)
-Tourism	819	325	405	(146)	197	30	1	(0)	-	-	-	-
-Energy	628	8	11	(13)	168	11	25	(4)	15	-	-	(0)
-Other	61	3	5	(4)	1,014	191	114	(24)	98	-	-	(0)
Public Sector	44	3	1	(2)	2	-	1	(0)	8	-	0	(0)
Total	16,705	5,560	12,040	(6,618)	6,649	652	834	(446)	1,851	39	76	(35)
Credit related Commitments	3,193	168	100	(62)	1,562	98	6	(2)	180	18	0	(0)
-Loan commitments	2,659	69	4	(20)	1,155	60	4	(1)	142	2	-	(0)
-Financial guarantee contracts and other commitments	534	99	96	(42)	407	38	2	(1)	38	16	0	(0)

(1) Includes POCI loans of € 42.9 million held by operations in Rest of Europe (2019: € 53.5 million in Rest of Europe and of € 0.5 million in Other countries).

(2) The operations in Rest of Europe include € 3,498 million related to the notes of the Pillar and Cairo securitizations (2019: € 1,058 million in Rest of Europe related to the notes of the Pillar securitization) .

As at 31 December 2020, the carrying amount of Group's loans measured at FVTPL of € 27 million (2019: € 58 million) were included in Wholesale lending portfolio, of which € 16 million (2019: € 47 million) were held by operations in Greece, while € 11 million (2019: € 11 million) were held by operations in Rest of Europe.

(d) Forbearance practices on lending activities

Modifications of the loans' contractual terms may arise due to various factors, such as changes in market conditions, customer retention and other factors as well as due to the potential deterioration in the borrowers' financial condition. The Group has employed a range of forbearance solutions in order to enhance the management of customer relationships and the effectiveness of collection efforts, as well as to improve the recoverability of cash flows and minimize credit losses for both retail and wholesale portfolios.

Forbearance practices' classification

Forbearance practices as monitored and reported by the Group, based on the European Banking Authority Implementing Technical Standards (EBA ITS) guidelines, occur only in the cases where the contractual payment terms of a loan have been modified, as the borrower is considered unable to comply with the existing loan's terms due to apparent financial difficulties, and the Group grants a concession by providing more favorable terms and conditions that it would not otherwise consider had the borrower not been in financial difficulties.

All other types of modifications granted by the Group, where there is no apparent financial difficulty of the borrower and may be driven by factors of a business nature are not classified as forbearance measures.

Forbearance solutions

Forbearance solutions are granted following an assessment of the borrower's ability and willingness to repay and can be of a short or longer term nature. The objective is to assist financially stressed borrowers by rearranging their repayment cash outflows into a sustainable modification, and at the same time, protect the Group from suffering credit losses. The Group deploys targeted segmentation strategies with the objective to tailor different short or long term and sustainable management solutions to selected groups of borrowers for addressing their specific financial needs.

The nature and type of forbearance options may include but is not necessarily limited to, one or more of the following:

arrears capitalization;
arrears repayment plan;
reduced payment above interest only;
interest-only payments;
reduced payment below interest only;
grace period;
interest rate reduction;
loan term extensions;
split balance and gradual step-up of installment payment plans;
partial debt forgiveness/write-down;
operational restructuring; and
debt to equity swaps.

Specifically for unsecured consumer loans (including credit cards), forbearance programs (e.g. term extensions), are applied in combination with debt consolidation whereby all existing consumer balances are pooled together. Forbearance solutions are applied in order to ensure a sufficient decrease on installment and a viable solution for the borrower. In selected cases, the debt consolidations may be combined with mortgage prenotations to convert unsecured lending exposures to secured ones.

In the case of mortgage loans, a decrease of installment may be achieved through forbearance measures such as extended payment periods, capitalization of arrears, split balance and gradual step-up of installment payment plans.

Wholesale exposures are subject to forbearance when there are indications of financial difficulties of the borrower, evidenced by a combination of factors including the deterioration of financials, credit rating downgrade, payment delays and other.

During 2020 in response to the COVID-19 pandemic, the EBA published guidelines on payment moratoria whereby the application of a general payment moratorium that meets the requirements of the guidelines would not in itself lead to a reclassification under the definition of forbearance. However, institutions should continue to categorize the exposures as performing or non-performing in accordance with the applicable requirements. More precisely, as a general principle, before granting a forbearance measure, credit

institutions should carry out an individual assessment of the repayment capacity of the borrower and grant forbearance measures tailored to the specific circumstances of the borrower in question.

Based on this, and following the internal process of individual assessmentsthe Bank flagged asforbearance measures certain payment moratoria for accounts in the hotel sector, which were considered to have increased financial difficulties.

Debt for equity swaps

For wholesale portfolios, the Group on occasion participates in debt for equity transactions as part of forbearance measures, as described in note 2.2.9. In 2020, equity positions acquired by the Group and held as of 31 December 2020 relate to the participation of 18.9% in Perigenis Business Properties S.A. for € 9.1 million, a special purpose real estate company which was established in the context of the debt restructuring of a Bank's corporate customer (note 24). Similarly in 2019, equity positions acquired by the Group and held as of 31 December 2019 were: a) 12.46% of the non-voting preference shares of Helesi S.A. for € 1.8 thousand and b) 6.75% of the non-voting preference shares of Akritas S.A. for € 0.01 million.

i. Classification of Forborne loans

Forborne loans are classified either as non-impaired (stage 2), or impaired (stage 3) by assessing their delinquency and credit quality status.

Credit impaired forborne loans enter initially a probation period of one year where the borrowers' payment performance is closely monitored. If at the end of the abovementioned period, the borrowers have complied with the terms of the program and there are no past due amounts and concerns regarding the loans' full repayment, the loans are then reported as non-impaired forborne loans (stage 2). In addition, non-impaired forborne loans, including those that were previously classified as credit impaired and complied with the terms of the program, are monitored over a period of two years. If, at the end of that period, the borrowers have made regular payments of a significant aggregate amount, there are no past due amounts over 30 days and the loans are neither credit impaired nor any other SICR criteria are met they exit forborne status and are classified as stage 1.

Particularly, the category of credit impaired forborne loans includes those that (a) at the date when forbearance measures were granted, were more than 90 days past due or assessed as unlikely to pay, (b) at the end of the one year probation period met the criteria of entering the non -impaired status and during the two years monitoring period new forbearance measures were extended or became more than 30 days past due, and (c) were initially classified as non- impaired and during the two years monitoring period met the criteria for entering the credit impaired status.

Furthermore, forborne loans that fail to perform under the new modified terms and are subsequently denounced cease to be monitored as part of the Group's forbearance activities and are reported as denounced credit impaired loans (stage 3) consistently with the Group's management and monitoring of all denounced loans.

ii. Impairment assessment

Where forbearance measures are extended, the Group performs an assessment of the borrower's financial condition and its ability to repay, under the Group's impairment policies, as described in notes 2.2.13 and 5.2.1. Accordingly, forborne loans to wholesale customers, retail individually significant exposures and financial institutions are assessed on an individual basis. Forborne retail lending portfolios are generally assessed for impairment separately from other retail loan portfolios on a collective basis as they consist of large homogenous portfolio.

iii. Loan restructurings

In cases where the contractual cash flows of a forborne loan have been substantially modified, the original forborne loan is derecognized and a new loan is recognized. The Group records the modified asset as a 'new' financial asset at fair value and the difference with the carrying amount of the existing one is recorded in the income statement as derecognition gain or loss.

In cases where the modification as a result of forbearance measures is not considered substantial, the Group recalculates the gross carrying amount of the loan and recognizesthe difference as a modification gain or lossin the income statement. The Group continues to monitor the modified forborne loan in order to determine if the financial asset exhibits significant increase in credit risk since initial recognition during the forbearance period.

As at 31 December 2020, the carrying amount of Group's forborne loans measured at FVTPL amounted to € 3.5 million (2019: € 26 million).

The following tables present an analysis of Group's forborne activities for loans measured at amortised cost. In order to align with the quantitative information provided in section (a) based on revised IFRS 7 requirements, the relevant tables below are presented on a gross carrying amount basis, while cumulative impairment allowance is presented separately, in line with the Group's internal credit risk monitoring and reporting.

The following table presents a summary of the types of the Group's forborne activities:

	2020	2019
	€ million	€ million
Forbearance measures:
Split balance	1,114	2,342
Loan term extension	2,184	2,696
Arrears capitalisation	224	380
Reduced payment below interest owed	111	227
Interest rate reduction	500	726
Reduced payment above interest owed	113	305
Arrears repayment plan	180	239
Interest only	39	53
Grace period	80	90
Debt/equity swaps	12	28
Partial debt forgiveness/Write-down	39	57
Operational restructuring	71	74
Other	160	244
Total gross carrying amount	4,826	7,461
Less: cumulative impairment allowance	(1,078)	(1,675)
Total carrying amount	3,748	5,786

The following tables present a summary of the credit quality of forborne loans and advances to customers:

	31 December 2020
	Total loans &
	advances at	Forborne
	amortised	loans &	% of Forborne
	cost	advances	loans &
	€ million	€ million	advances
Gross carrying amounts:
12-month ECL-Stage 1	28,714	-	-
Lifetime ECL-Stage 2	6,436	2,974	46.2
Lifetime ECL credit-impaired	5,724	1,852	32.4
Total Gross Amount	40,874	4,826	11.8
Cumulative ECL Loss allowance:
12-month ECL-Stage 1	(183)	-
Lifetime ECL-Stage 2	(439)	(257)
Lifetime ECL (credit-impaired) of which:	(2,855)	(821)
- Individually assessed	(925)	(312)
- Collectively assessed	(1,930)	(509)
Total carrying amount	37,397	3,748	10.0
Collateral received	26,920	3,399

		31 December 2019
	Total loans & advances at amortised cost € million	Forborne loans & advances € million	% of Forborne loans & advances
Gross carrying amounts:
12-month ECL-Stage 1	25,205	-	-
Lifetime ECL-Stage 2	6,251	4,155	66.5
Lifetime ECL credit-impaired	12,950	3,306	25.5
Total Gross Amount	44,406	7,461	16.8
Cumulative ECL Loss allowance:
12-month ECL-Stage 1	(136)	-
Lifetime ECL-Stage 2	(407)	(311)
Lifetime ECL (credit-impaired) of which:	(6,556)	(1,364)
- Individually assessed	(2,129)	(453)
- Collectively assessed	(4,427)	(911)
Total carrying amount	37,307	5,786	15.5
Collateral received	27,256	5,171

The following table presents the movement of forborne loans and advances:

	2020 € million	2019 € million
Gross carrying amount at 1 January	7,461	9,662
Forbearance measures in the year⁽¹⁾	610	779
Forborne loans derecognised/ reclassified as held for sale during the year ⁽²⁾ Write-offs of forborne loans	(1,621) (35)	(782) (114)
Repayment of loans	(241)	(412)
Loans & advances that exited forbearance status ⁽³⁾ Other	(1,296) (51)	(1,843) 171
Less: cumulative impairment allowance Carrying amount at 31 December	(1,078) 3,748	(1,675) 5,786

(1) Forbearnce measures in the year depict loans to which forbearance measures were granted for the first time during the reporting period.

(2) "Forborne loans derecognised/ reclassified as held for sale during the year" presents loans derecognized during the year due to a) securitization/ sale transactions (note 20) and b) substantial modifications of the loans' contractual terms and those that have been reclassified as held for sale during the year (note 30).

(3) In 2020, an amount of € 188 million loans and advances that exited forbearance status refers to loans that were denounced (2019: € 482 million).

The following table presents the Group's exposure to forborne loans and advances by product line:

	2020	2019
	€ million	€ million
Retail Lending	3,547	5,483
- Mortgage	2,381	3,753
- Consumer	238	305
- Credit card	58	66
- Small business	870	1,359
Wholesale Lending	1,279	1,978
-Large corporate	541	1,063
-SMEs	738	915
Total gross carrying amount	4,826	7,461
Less: cumulative impairment allowance	(1,078)	(1,675)
Total carrying amount	3,748	5,786

The following table presents the Group's exposure to forborne loans and advances by geographical region:

	2020 € million	2019 € million
Greece	4,415	6,983
Rest of Europe	403	468
Other countries	8	10
Total gross carrying amount	4,826	7,461
Less: cumulative impairment allowance	(1,078)	(1,675)
Total carrying amount	3,748	5,786

The following table provides information on modifications due to forbearance measures on lending exposures which have not resulted in derecognition. Such financial assets were modified while they had a loss allowance measured at an amount equal to lifetime ECL.

	2020	2019
Modified lending exposures	€ million	€ million
Loans modified during the year with loss allowance measured at an amount equal to lifetime ECL
Gross carrying amount at 31 December⁽¹⁾	1,076	1,637
Modification loss	31	65
Loans modified since initial recognition at a time when loss allowance was based on lifetime ECL
Gross carrying amount at 31 December for which loss allowance has changed to 12-month ECL measurement	778	1,101

(1) Gross carrying amount at 31 December includes all loans modifications due to forbearance during the year.

In the year ended 31 December 2020, the gross carrying amount of loans previously modified for which the loan allowance has reverted to being measured at an amount equal to lifetime ECL amounted to € 671 million (2019: € 216 million).

(e) Covid-19 relief ('moratoria') and government support measures

Covid-19 relief measures ('moratoria')

Covid-19 relief measures provided by the Group to the eligible borrowers are mainly in the form of:

arrears capitalization, payment holidays(installment for Mortgage/Consumer lending portfolios and capital re-payment for Small Business/Wholesale lending portfolios) deferred up to nine months, along with the extension of the respective loans' maturity, and
support measures specifically addressed to one of the most affected Greek industries hoteling, the main features being the principal payments' deferral up to 31 December 2021, the disbursement of new working capital facilities and the continuation of the financing of the already approved capital investments.

As at 31 December 2020 the approved amount of performing loans (including performing forborne) under moratoria (both active and expired) stands at € 5 billion for Greece consisting of € 1.5 billion in Wholesale lending and € 3.5 billion in Retail lending. For International (i.e. foreign subsidiaries in Bulgaria, Serbia, Cyprus and Luxembourg) the respective total approved amount stands at € 2 billion consisting of €1.5 billion in Wholesale lending and € 0.5 billion in Retail lending.

The following table presents the respective gross carrying amount under active moratoria as at 31 December 2020:

	31 December 2020
	Wholesale lending	Retail lending	Total Gross Carrying amount
	Gross Carrying amount	Gross Carrying amount
	€ million	€ million	€ million
Greece	1,550	182	1,732
International	930	96	1,026
Total	2,480	278	2,758

In Greece, gross carrying amount of approximately € 1 billion related to active moratoria expired within the first quarter of 2021 while the majority of the remaining active moratoria expiresin the second quarter of 2021. In International, the majority of active moratoria expired in the first quarter of 2021.

Eligible borrowers subject to moratoria

Based on recent banking regulators' and accounting guidance (European Banking Authority (EBA), ECB, IASB) the Covid-19 relief measures should neither be treated as forbearance nor automatically trigger a significant increase in credit risk. Such measures are accounted for as modifications, granted for other than forbearance reasons. As the installments or capital owed are only deferred over a maximum period of up to 9 months or up to 31 December 2021 in case of hoteling, on an interest-bearing basis, no significant impact has arisen upon moratoria's enactment.

Government support measures

In addition to the relief measures provided by the Group (as described above), the government in the countries where the Group operates has initiated various programs, in order to stimulate liquidity and economic activity and to alleviate the consequences of the Covid-19 outbreak. Such measures involve the suspension of tax payments and social security contributions, financial compensations for employees from directly affected by the lockdown companies, as well as, government guarantees, co-financing

and subsidized interest payments for new disbursements and subsidized installment payments on existing loans, secured with borrowers' primary residence collaterals.

The main programs applicable to eligible borrowers in Greece include:

(i) State participation (of 40% or 5%) on newly disbursed loans granted by the Bank that is zero-interest bearing, accompanied with a government-subsidy for the interest bearing part of the principal (of 60% or 95% respectively) for the first 2 years (TEPIX II), (ii) State aid in the form of a guarantee for the 80% of the principal and the accrued interest during a period of 90 consecutive days, and (iii) ''Gefyra I'' subsidy program, applicable to the Retail lending portfolio secured with prime residence collateral, involving 9-months installments'state subsidy on existing lending exposures. The "Gefyra II" subsidy program, applicable to Small Business and Wholesale lending portfolios, will be extended to eligible borrowers within 2021.

As of 31 December 2020, the Bank has been allotted € 0.6 billion, of which € 0.3 billion has been utilized under program i) above and € 1.4 billion, of which € 1.1 billion utilized, under program ii) above. It is noted that the credit enhancement provided by the State under program ii) above is not accounted for separately as it is integral to the loans' terms and as such any potential benefit that may arise to the Bank in the event of the borrower's default is reflected in the guaranteed loans' ECL calculation. Additionally, the gross carrying amount of lending exposures under "Gefyra I" program amounts to € 1.3 billion as at 31 December 2020, mainly relating to Mortgage lending.

In addition, starting from December 2020, the Bank signed an agreement with the European Investment Bank (EIB) for the disbursement of new loans financed by EIB as a response to the Covid-19 Crisis. Moreover, on existing lending facilities in the Corporate lending portfolio, a three-month, which was extended subsequently to five-month, government interest subsidy program was initiated, which could be opted in combination with the other Covid-19 relief measures.

As at 31 December 2020, the gross carrying amount of loans under government support measures enacted as a response to Covid-19 pandemic in the countries that the Group operates amounts to € 106 million in Serbia, € 13 million in Bulgaria and € 18 million in Cyprus.

5.2.1.3 Debt Securities

The following tables present an analysis of debt securities by external credit rating agency designation at 31 December 2020 and 2019, based on Moody's ratings or their equivalent:

	31 December 2020
	12-month ECL	Lifetime ECL
	Stage 1	Stage 2	Total
	€ million	€ million	€ million
Investment securities at amortised cost
Aaa	195	-	195
Aa1 to Aa3	105	-	105
A1 to A3	5	-	5
Lower than A3	2,484	-	2,484
Gross Carrying Amount	2,789	-	2,789
Impairment Allowance	(5)	-	(5)
Carrying Amount	2,784	-	2,784
Investment securities at FVOCI
Aaa	276	-	276
Aa1 to Aa3	435	-	435
A1 to A3	586	-	586
Lower than A3	4,070	10	4,080
Unrated	77	-	77
Carrying Amount	5,444	10	5,454

		31 December 2019
	12-month ECL	Lifetime ECL
	Stage 1	Stage 2	Total
	€ million	€ million	€ million
Investment securities at amortised cost
Aaa	100	-	100
Lower than A3	1,442	-	1,442
Gross Carrying Amount	1,542	-	1,542
Impairment Allowance	(3)	-	(3)
Carrying Amount	1,539	-	1,539
Investment securities at FVOCI
Aaa	405	-	405
Aa1 to Aa3	426	-	426
A1 to A3	354	-	354
Lower than A3	5,016	-	5,016
Unrated	77	-	77
Carrying Amount	6,278	-	6,278
		31 December 2020

		Investment securities
	Securities held	measured at
	for trading	FVTPL
	€ million	€ million
Securities at FVTPL
Aa1 to Aa3	-	2
Lower than A3	42	0
Carrying Amount	42	2
	31 December 2019
		Investment
		securities
	Securities held	measured at
	for trading	FVTPL
	€ million	€ million
Securities at FVTPL
Aa1 to Aa3	-	3
Lower than A3	53	0
Carrying Amount	53	3

Securities rated lower than A3 include: € 4,038 million related to Greek sovereign debt (2019: € 4,308 million), € 1,208 million related to Eurozone members sovereign debt (2019: € 1,197 million) and € 547 million related to sovereign debt issued mainly by European Union members and candidate members (2019: € 448 million).

The following tables present the Group's exposure in debt securities, as categorized by stage, counterparty's geographical region and industry sector:

	31 December 2020
	Greece		Other European countries		Other countries
	12-month ECL	Lifetime ECL	12-month ECL	Lifetime ECL	12-month ECL	Lifetime ECL
	Stage 1	Stage 2	Stage 1	Stage 2	Stage 1	Stage 2	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Investment securities at amortised cost
Sovereign	1,951	-	527	-	-	-	2,478
Banks	106	-	161	-	2	-	269
Corporate	-	-	42	-	-	-	42
Gross Carrying Amount	2,057	-	730	-	2	-	2,789
Impairment Allowance	(4)	-	(1)	-	(0)	-	(5)
Net Carrying Amount	2,053	-	729	-	2	-	2,784
Investment securities at FVOCI
Sovereign⁽¹⁾	2,067	-	1,886	-	265	-	4,218
Banks	95	-	384	-	4	-	483
Corporate	149	6	406	-	188	4	753
Carrying Amount	2,311	6	2,676	-	457	4	5,454

	31 December 2019
	Greece		Other European countries		Other countries
	12-month ECL Stage 1	Lifetime ECL Stage 2	12-month ECL Stage 1	Lifetime ECL Stage 2	12-month ECL Stage 1	Lifetime ECL Stage 2	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Investment securities at amortised cost
Sovereign	1,044	-	488	-	-	-	1,532
Banks	10	-	-	-	-	-	10
Corporate	-	-	-	-	-	-	-
Gross Carrying Amount	1,054	-	488	-	-	-	1,542
Impairment Allowance	(2)	-	(1)	-	-	-	(3)
Net Carrying Amount	1,052	-	487	-	-	-	1,539
Investment securities at FVOCI
Sovereign⁽¹⁾	3,226	-	1,883	-	173	-	5,282
Banks	89	-	267	-	10	-	366
Corporate	210	-	277	-	143	-	630
Carrying Amount	3,525	-	2,427	-	326	-	6,278

(1) As at 31 December 2020, sovereign debt securities of other European countries include EFSF bonds of carrying amount of € 171 million (2019: € 199 million).

		31 December 2020
	Greece € million	Other European countries € million	Total € million
Investment securities at FVTPL
Corporate	0	2	2
Carrying Amount	0	2	2
Securities held for trading
Sovereign	22	20	42
Carrying Amount	22	20	42
		31 December 2019
		Other European
	Greece	countries	Total
	€ million	€ million	€ million
Investment securities at FVTPL
Corporate	0	3	3
Carrying Amount	0	3	3
Securities held for trading
Sovereign	40	12	52
Corporate	-	1	1

Carrying Amount 40 13 53

5.2.1.4 Offsetting of financial assets and financial liabilities

The disclosures set out in the tables below include financial assets and financial liabilities that:

(a) are offset in the Group's balance sheet according to IAS 32 'Financial Instruments: Presentation' criteria; or (b) are subject to enforceable master netting arrangements orsimilar agreementsthat coversimilar financial instruments, irrespective of whether they are offset in balance sheet.

Regarding the former, financial assets and financial liabilities are offset and the net amount is reported in the balance sheet when, there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis, or realize the asset and settle the liability simultaneously (the offset criteria), as also set out in Group's accounting policy 2.2.4.

Regarding the latter, the International Swaps and Derivatives Association (ISDA) and similar master netting arrangements do not meet the criteria for offsetting in the balance sheet, as they create a right of set-off that is enforceable only following an event of default, insolvency or bankruptcy of the Group or the counterparties or following other predetermined events. In addition, the Group and its counterparties may not intend to settle on a net basis or to realize the assets and settle the liabilities simultaneously.

Similar agreements to ISDA include derivative clearing agreements, global master repurchase agreements, and global master securities lending agreements. Similar financial instruments include derivatives, repos and reverse repos agreements and securities borrowing and lending agreements. Financial instruments such as loans and deposits are not subject to this disclosure unlessthey are offset in the balance sheet.

The following tables present financial assets and financial liabilities that meet the criteria for offsetting and thus are reported on a net basis in the balance sheet, as well as amounts that are subject to enforceable master netting arrangements and similar agreements for which the offset criteria mentioned above are not satisfied. The latter amounts, which mainly relate to derivatives, repos and reverse repos, are not set off in the balance sheet. In respect of these transactions, the Group receives and provides collateral in the form of marketable securities and cash that are included in the tables below under columns 'financial instruments' and 'cash collateral' at their fair value.

	31 December 2020
				Related amounts not offset in the BS
	Gross amounts of recognised financial assets € million	Gross amounts of recognised financial liabilities offset in the balance sheet € million	Net amounts of financial assets presented in the balance sheet € million	Financial instruments (incl. non-cash collateral) € million	Cash collateral received € million	Net amount € million
Financial Assets
Reverse repos with central banks	19	-	19	(19)	-	-
Reverse repos with banks	1,265	(1,065)	200	(200)	-	-
Derivative financial instruments	2,537	-	2,537	(2,385)	(17)	135
Oher financial assets	51	(51)	-	-	-	-
Total	3,872	(1,116)	2,756	(2,604)	(17)	135

	31 December 2020
				Related amounts not offset in the BS
	Gross amounts of recognised financial liabilities € million	Gross amounts of recognised financial assets offset in the balance sheet € million	Net amounts of financial liabilities presented in the balance sheet € million	Financial instruments (incl. non-cash collateral) € million	Cash collateral pledged € million	Net amount € million
Financial Liabilities Derivative financial instruments Repurchase agreements with banks Other financial liabilities	2,932 1,748 51	- (1,065) (51)	2,932 683 -	(753) (683) -	(2,163) - -	16 - -
Total	4,731	(1,116)	3,615	(1,436)	(2,163)	16

	31 December 2019
	Related amounts not offset in the BS
		Gross amounts of recognised financial	Net amounts of	Financial
	Gross amounts	liabilities offset	financial assets	instruments	Cash
	of recognised	in the balance	presented in the	(incl. non-cash	collateral	Net
	financial assets	sheet	balance sheet	collateral)	received	amount
	€ million	€ million	€ million	€ million	€ million	€ million
Financial Assets
Reverse repos with central banks	50	-	50	(50)	-	-
Reverse repos with banks	1,634	(1,607)	27	(27)	-	-
Derivative financial instruments	2,233	-	2,233	(2,134)	(11)	88
Oher financial assets	45	(45)	-	-	-	-
Total	3,962	(1,652)	2,310	(2,211)	(11)	88

	31 December 2019
		Related amounts not offset in the BS
	Gross amounts of	Gross amounts of recognised financial assets	Net amounts of financial liabilities presented in	Financial instruments (incl.	Cash
	recognised financial liabilities	offset in the balance sheet	the balance sheet	non-cash collateral)	collateral pledged	Net amount
	€ million	€ million	€ million	€ million	€ million	€ million
Financial Liabilities
Derivative financial instruments	2,721	-	2,721	(606)	(2,073)	42
Repurchase agreements with
banks	5,874	(1,607)	4,267	(4,267)	-	-
Other financial liabilities	45	(45)	-	-	-	-
Total	8,640	(1,652)	6,988	(4,873)	(2,073)	42

Financial assets and financial liabilities are disclosed in the above tables at their recognized amounts, either at fair value (derivative assets and liabilities) or amortized cost (all other financial instruments), depending on the type of financial instrument.

5.2.2 Market risk

The Group takes on exposure to market risk, which is the risk of potential financial loss due to an adverse change in market variables. Changes in interest rates, foreign exchange rates, credit spreads, equity prices and other relevant factors, such as the implied volatilities, can affect the Group's income or the fair value of its financial instruments. The market risks, the Group is exposed to, are managed and monitored by Group Market and Counterparty Risk Sector (GMCRS).

GMCRS is responsible for the measurement, monitoring, control and reporting of all market risks, including the interest rate risk in the Banking Book (IRRBB) of the Group. The Sector reports to the GCRO and its main responsibilities include:

Monitoring of all key market & IRRBB risk indicators (VaR, sensitivities, interest rate gaps);
Implementation of Stress Testing methodologies for market risk (historical and hypothetical), and IRRBB;
Monitoring and reporting of market and IRRBB risk limits utilization; and
Development, maintenance and expansion of risk management infrastructure.

The market risks the Group is exposed to, are the following:

(a) Interest rate risk

The Group takes on exposure to the effects of fluctuations in the prevailing levels of market interest rates on its cash flows and the fair value of its financial positions. Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Fair value interest rate risk is the risk that the value of a financial instrument will fluctuate because of changes in market interest rates. Fair value interest rate risk is further split into 'General' and 'Specific'. The former refers to changes in the fair valuation of positions due to the movements of benchmark interest rates, while the latter refers to changes in the fair valuation of positions due to the movements of specific issuer yields and credit spreads.

(b) Currency risk

The Group takes on exposure to the effects of fluctuations in the prevailing foreign currency exchange rates on its financial position and cash flows.

(c) Equity risk

Equity price risk is the risk of the decrease of fair values as a result of changes in the levels of equity indices and the value of individual stocks. The equity risk that the Group undertakes arises mainly from the investment portfolio.

(d) Implied volatilities

The Group carries limited implied volatility (vega) risk, mainly as a result of open positions on interest rate options.

The Board's Risk Committee sets limits on the level of exposure to market risks, which are monitored on a daily basis.

Market risk in Greece and International Subsidiaries is managed and monitored mainly using Value at Risk (VaR) methodology. Sensitivity analysis is additionally performed. Information from International operations is also presented separately, as it originates from different economic environments with different risk characteristics.

(i) VaR summary for 2020 and 2019

VaR is a methodology used in measuring financial risk by estimating the potential negative change in the market value of a portfolio at a given confidence level and over a specified time horizon. The VaR that the Group measures is an estimate based upon a 99% confidence level and a holding period of 1 day and the methodology used for the calculation is Monte Carlo simulation (full re-pricing).

The VaR models are designed to measure market risk in a normal market environment. It is assumed that any changes occurring in the risk factors affecting the normal market environment will follow a normal distribution.

Although VaR is an important tool for measuring market risk, the assumptions on which the model is based do give rise to certain limitations. Given this, actual outcomes are monitored regularly, via back testing process, to test the validity of the assumptions and the parameters used in the VaR calculation.

The perimeter of the VaR analysis in 2020 includes Eurobank Ergasias Services and Holdings S.A., Eurobank S.A. and its banking subsidiaries, taking into account the FVTPL, including trading and FVOCI portfolios. Consequently, the potential impact asit is depicted in the VaR figures would directly affect Group's Capital (income statement or equity). Comparative figures have been adjusted accordingly.

Since VaR constitutes an integral part of the Group's market risk control regime, VaR limits have been established for all the above operations (trading and investment portfolios measured at fair value) and actual exposure is reviewed daily by management. However, the use of this approach does not prevent losses outside of these limits in the event of extraordinary market movements.

VaR by risk type - Greece and International Subsidiaries¹

	2020 (Average)	2020	2019
	€ million	€ million	€ million
Interest Rate Risk	70	12	44
Foreign Exchange Risk	0	1	0
Equities Risk	1	0	0
Total VaR	70	12	44

The aggregate VaR of the interest rate, foreign exchange and equities VaR benefits from diversification effects. The largest portion of the Group'sInterest rate VaR figures is attributable to the risk associated with interest rate and credit spread sensitive debt securities and derivatives. The average VaR of 2020 is significantly larger than end of year 2019 and 2020 figures, since it incorporates the impact of the Covid 19 pandemic that resulted to significant market disruption, mainly in March and April of 2020. The market volatility has gradually decreased, after April 2020, reaching its lowest levels at the end of the year.

¹ Includes all portfolios measured at fair value.

The following table presents the Interest Rate Repricing analysis of the items with material contribution to the Group's Interest Rate Risk exposure. These items include debt securities held and issued, securitization notes and derivatives.

			31 December 2020
	less than 1 month € million	1-3 months € million	3-12 months € million	1-5 years € million	More than 5 years € million
Securities held for trading	-	1	-	24	13
-Fixed coupon bonds	-	1	-	24	13
-Variable coupon bonds	-	-	-	-	-
Investment securities & Senior Notes	219	276	615	4,615	4,352
-Fixed coupon bonds	180	100	485	2,149	3,579
-Variable coupon bonds	39	143	-	-	2
-Senior Notes (Cairo & Pillar)	-	33	130	2,466	771
Debt issued (Third parties)	-	(594)	-	-	(950)
-Fixed coupon covered bonds	-	-	-	-	-
-Fixed coupon subordinated notes (Tier 2)	-	-	-	-	(950)
-Variable coupon securitisations	-	(594)	-	-	-
Derivatives⁽¹⁾	410	(138)	1,407	1,306	(3,014)

			31 December 2019
	less than 1			1-5	More than 5
	month	1-3 months	3-12 months	years	years
	€ million	€ million	€ million	€ million	€ million
Securities held for trading	-	1	1	6	36
-Fixed coupon bonds	-	1	1	6	36
-Variable coupon bonds	-	-	-	-	-
Investment securities & Senior Notes	95	272	556	1,937	4,554
-Fixed coupon bonds	57	122	501	1,479	4,012
-Variable coupon bonds	37	150	3	-	-
-Senior Notes (Pillar)	1	-	52	458	542
Debt issued (Third parties)	-	(944)	(500)	-	(950)
-Fixed coupon covered bonds	-	-	(500)	-	-
-Fixed coupon subordinated notes (Tier 2)	-	-	-	-	(950)
-Variable coupon securitisations	-	(944)	-	-	-
Derivatives⁽¹⁾⁽²⁾	268	(628)	1,868	1,089	(2,629)

(1) For linear interest rate derivatives, notional amounts are shown in the appropriate time band, aggregated across all currencies. For non-linear interest rate derivatives, delta equivalent notional amounts are shown in the appropriate time band, aggregated across all currencies.

(2) Comparative information has been adjusted with (a) the reallocation of derivative amounts among time bands and (b) the inclusion ofsenior notes of "Pillar" securitization.

In addition to the above, the Bank has exposure on Structural FX position, due to its Subsidiary Bank in Serbia. Under the scenario of 10% depreciation of the RSD versus EUR, the impact in Group's equity as of 31 December 2020 would stand at € 49 million loss (31 December 2019: € 47 million loss).

(iii) Foreign exchange risk

The following table presents the Group's exposure to foreign currency exchange risk as at 31 December 2020 and 2019:

				31 December 2020
	USD	CHF	RON	RSD	BGN	OTHER	EUR	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
ASSETS
Cash and balances with
central banks	8	6	0	211	498	7	5,907	6,637
Due from credit
institutions	296	30	24	0	0	104	2,882	3,336
Securities held for trading	0	-	-	-	21	0	66	87
Derivative financial
instruments	44	2	-	-	0	0	2,506	2,552
Loans and advances to
customers	2,116	2,518	18	464	2,856	350	29,102	37,424
Investment securities	737	-	0	45	5	18	7,560	8,365
Other assets⁽¹⁾	20	0	3	85	175	1	9,004	9,288
Assets of disposal groups
classified as held for sale
(note 30)	-	-	-	-	-	-	39	39
Total Assets	3,221	2,556	45	805	3,555	480	57,066	67,728
LIABILITIES
Due to central banks and
credit institutions	81	0	0	0	14	37	9,369	9,501
Derivative financial
instruments	61	0	0	0	0	1	2,877	2,939
Due to customers	4,370	104	0	328	3,240	410	38,838	47,290
Debt securities in issue	0	-	-	-	-	-	1,556	1,556
Other liabilities	27	3	23	8	66	6	1,064	1,197
Total Liabilities	4,539	107	23	336	3,320	454	53,704	62,483
Net on balance sheet
position	(1,318)	2,449	22	469	235	26	3,362	5,245
Derivative forward
foreign exchange position	1,117	(2,452)	(18)	3	0	(63)	(240)	(1,653)
Total Foreign Exchange
Position	(201)	(3)	4	472	235	(37)	3,122	3,592

				31 December 2019
	USD	CHF	RON	RSD	BGN	OTHER	EUR	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
ASSETS
Cash and balances with
central banks	11	3	0	149	530	6	3,980	4,679
Due from credit
institutions	186	16	21	0	0	91	2,693	3,007
Securities held for trading	-	-	-	0	5	0	105	110
Derivative financial
instruments	23	2	-	0	0	0	2,237	2,262
Loans and advances to
customers	2,175	3,426	20	428	2,583	327	28,406	37,365
Investment securities	696	0	0	69	20	6	7,160	7,951
Other assets⁽¹⁾	23	19	5	85	149	2	9,029	9,312
Assets of disposal groups
classified as held for sale
(note 30)	0	-	-	-	-	-	75	75
Total Assets	3,114	3,466	46	731	3,287	432	53,685	64,761
LIABILITIES
Due to central banks and
credit institutions	292	0	0	0	17	10	6,603	6,922
Derivative financial
instruments	30	0	0	0	0	0	2,696	2,726
Due to customers	4,224	84	0	252	2,977	446	36,858	44,841
Debt securities in issue	0	-	-	-	-	-	2,406	2,406
Other liabilities	28	1	30	7	72	3	1,050	1,191
Liabilities of disposal
group classified as held for
sale (note 30)	0	-	-	-	-	-	8	8
Total Liabilities	4,574	85	30	259	3,066	459	49,621	58,094
Net on balance sheet
position	(1,460)	3,381	16	472	221	(27)	4,064	6,667

Derivative forward foreign
exchange position	1,483	(3,374)	0	0	0	33	(120)	(1,978)

Total Foreign Exchange
Position	23	7	16	472	221	6	3,944	4,689

(1)Other assets include Investments in associates and joint ventures, Property and equipment, Investment property, Intangible assets, Deferred tax assets and Other assets.

5.2.3 Liquidity risk

The Group is exposed to daily calls on its available cash resources due to deposits withdrawals, maturity of medium or long term notes, maturity of secured or unsecured funding (interbank repos and money market takings), loan draw-downs and forfeiture of guarantees. Furthermore, margin calls on secured funding transactions (with ECB and the market), on risk mitigation contracts (CSAs, GMRAs) and on centrally cleared transactions (CCPs) result in liquidity exposure. The Group maintains cash resources to meet all of these needs. The Board Risk Committee sets liquidity limits to ensure that sufficient funds are available to meet such contingencies.

Past experience shows that liquidity requirements to support calls under guarantees and standby letters of credit are considerably less than the amount of the commitment. This is also the case with credit commitments where the outstanding contractual amount to extend credit does not necessarily represent future cash requirements, as many of these commitments will expire or terminate without being funded.

The matching and controlled mismatching of the maturities and interest rates of assets and liabilities is fundamental to the management of the Group. It is unusual for banks to be completely matched, as transacted business is often of uncertain term and of different types. An unmatched position potentially enhances profitability, but also increases the risk of losses.

The maturities of assets and liabilities and the ability to replace, at an acceptable cost, interest bearing liabilities as they mature, are important factors in assessing the liquidity of the Group.

Liquidity Risk Management Framework

The Group's Liquidity Risk Management Policy defines the following supervisory and control structure:

Board Risk Committee's role is to approve all strategic liquidity risk management decisions and monitor the quantitative and qualitative aspects of liquidity risk;
Group Assets and Liabilities Committee has the mandate to form and implement the liquidity policies and guidelines in conformity with Group's risk appetite, and to review at least monthly the overall liquidity position of the Group;
Group Treasury is responsible for the implementation of the Group's liquidity strategy, the daily management of the Group's liquidity and for the preparation and monitoring of the Group's liquidity budget; and
Group Market and Counterparty Risk Sector is responsible for measuring, monitoring and reporting the liquidity of the Group.

The following list summarizes the main reports which are produced on a periodic basis:

(a) The regulatory liquidity gap report along with the regulatory liquidity ratios;
(b) Stress test scenarios. These scenarios evaluate the impact of a number of stress events on the Group's liquidity position;
(c) Report on market sensitivities affecting liquidity;
(d) Liquidity coverage ratios (LCR) estimation (Basel III new regulatory ratio); and
(e) Reporting on the Bank's Asset Encumbrance.

Maturity analysis of assets and assets held for managing liquidity risk

The following tables present maturity analysis of Group assets as at 31 December 2020 and 2019, based on their carrying values. Loans without contractual maturities are presented in the 'less than 1 month' time bucket. The Group has established credit risk mitigation contracts with its interbank counterparties (ISDA/CSA). Under these contracts the Group has posted or received collateral, which covers the corresponding net liabilities or net assets from derivative transactions. The collateral posted is not presented in the below tables. For derivative assets not covered by ISDA/CSA agreements the positive valuation is presented at fair value in the 'over 1 year' time bucket.

			31 December 2020
	Less than 1	1 - 3	3 months	Over 1
	month	months	to 1 year	year	Total
	€ million	€ million	€ million	€ million	€ million
- Cash and balances with central banks	6,637	-	-	-	6,637
- Due from credit institutions	612	22	-	223	857
- Loans and advances to customers	2,890	961	3,602	29,971	37,424
- Debt Securities	207	84	491	7,500	8,282
- Equity securities	-	-	-	170	170
- Derivative financial instruments	-	-	-	148	148
- Other assets⁽¹⁾	66	17	9	9,196	9,288
- Assets of disposal groups classified as held for sale (note 30)	-	-	39	-	39
Total	10,412	1,084	4,141	47,208	62,845

Notes to the Consolidated Financial Statements
------------------------------------------------

		31 December 2019
	Less than 1	1 - 3	3 months	Over 1
	month	months	to 1 year	year	Total
	€ million	€ million	€ million	€ million	€ million
- Cash and balances with central banks	4,679	-	-	-	4,679
- Due from credit institutions	378	-	-	342	720
- Loans and advances to customers	3,213	792	3,705	29,655	37,365
- Debt Securities	96	87	514	7,176	7,873
- Equity securities	-	-	-	188	188
- Derivative financial instruments	-	-	-	119	119
- Other assets⁽¹⁾	66	17	9	9,220	9,312
- Assets of disposal groups classified as held for sale	-	2	73	-	75
Total	8,432	898	4,301	46,700	60,331

(1) Other assetsinclude Investmentsin associates and joint ventures, Property, plant and equipment, Investment property, Intangible assets, Deferred tax assets and Other assets.

The Group holds a diversified portfolio of cash and high liquid assets to support payment obligations and contingent deposit withdrawals in a stressed market environment. The Group's assets held for managing liquidity risk comprise:

(a) Cash and balances with central banks;
(b) Eligible bonds and other financial assets for collateral purposes; and
(c) Current accounts with banks and interbank placings maturing within one month.

The unutilized assets, containing highly liquid and central banks eligible assets, provide a contingent liquidity reserve of € 18.0 billion as at 31 December 2020 (2019: € 17.4 billion). In addition, the Group holds other types of highly liquid assets, as defined by the regulator, amounting to € 2.1 billion (cash value) (2019: € 1.5 billion). It should be noted that a part of ECB's available collateral of € 4.1 billion (cash value) (2019: € 3.5 billion) is held by Group'ssubsidiaries for which temporary local regulatory restrictions are applied and currently limit the level of its transferability between group entities.

Maturity analysis of liabilities

The amounts disclosed in the tables below are the contractual undiscounted cash flowsfor the years 2020 and 2019. Liabilities without contractual maturities (sight and saving deposits) are presented in the 'less than 1 month' time bucket. The Group has established credit risk mitigation contracts with its interbank counterparties (ISDA/CSA). Due to these contracts the Group has already posted collateral which covers the valuation of its net liabilities from interbank derivatives. For derivative liabilities not covered by ISDA/CSA agreements the negative valuation is presented at fair value in the 'less than 1 month' time bucket.

It should be noted that this table represents the worst case scenario since it is based on the assumption that all liabilities will be paid earlier than expected (all term deposits are withdrawn at their contractual maturity). The recent experience shows that even in a period of a systemic financial crisis the likelihood of such an event is remote.

	31 December 2020
	Gross nominal
Less than	1 - 3	3 months	Over	(inflow)/
1 month	months	to 1 year	1 year	outflow
€ million	€ million	€ million	€ million	€ million

649	260	83	8,412	9,404
37,203	4,262	5,541	296	47,302
-	166	131	1,717	2,014
3	7	27	327	364
286	406	285	-	977
38,141	5,101	6,067	10,752	60,061
10	-	-	-	10

Off-balance sheet items

	Less than	Over
	1 year	1 year
	€ million	€ million
Credit related commitments	1,538	4,173
Contractual commitments⁽¹⁾	40	-
Total	1,578	4,173

	31 December 2019
					Gross nominal
	Less than	1 - 3	3 months	Over	(inflow)/
	1 month	months	to 1 year	1 year	outflow
	€ million	€ million	€ million	€ million	€ million
Non-derivative liabilities:
- Due to central banks and credit institutions	2,706	1,778	41	2,401	6,926
- Due to customers	32,862	5,594	6,260	161	44,877
- Debt securities in issue	31	83	792	2,066	2,972
- Lease liabilities	3	6	27	259	295
- Other liabilities	365	348	295	-	1,008
- Liabilities of disposal group classified as held for sale (note 30)	-	-	8	-	8
	35,967	7,809	7,423	4,887	56,086
Derivative financial instruments	6	-	-	-	6

Off-balance sheet items

	Less than	Over
	1 year	1 year
	€ million	€ million
Credit related commitments	3,696	1,630
Contractual commitments⁽¹⁾	149	-
Total	3,845	1,630

(1) It refers to contractual commitments for the purchase of own used and investment property and intangible assets (note 42).

5.2.4 Interest Rate Benchmark reform – IBOR reform

Following the financial crisis, global regulators undertook a fundamental review of major interest rate benchmarks and convened working groupsin variousjurisdictions to identify and promote the use of risk-free reference rates ("RFRs") based on liquid underlying market transactions, as alternatives to the existing Interbank Offered Rates (IBORs). The Working Group on Euro Risk Free Rates, a private sector group, set up by the European Central Bank (ECB), together with the Financial Services and Markets Authority, the European Securities and Markets Authority and the European Commission (the "Working Group on Euro Risk Free Rates") has undergone work for the facilitation of the transition of the Euro Overnight Index Average rate (EONIA) to the alternative risk –free euro Short Term Rate (€STR), as a result of EONIA not being compliant with the EU Benchmark Regulation (hereinafter, ΒΜR) and, more recently, for the identification of the EURIBOR fallback rates, in accordance with the requirements of the BMR. According to the European Money Market Institute (EMMI), the administrator of EONIA and EURIBOR, the permanent cessation of EONIA will occur on 3 January 2022.

In other jurisdictions, the respective working groups have set-up alternative risk free rates in place of the overnight LIBOR rates. In March 2021, UK Financial Conduct Authority (FCA), the regulatory supervisor of ICE Benchmark Administration (IBA) which is the administrator of LIBOR, announced that all non USD LIBOR rates and the 1-week and 2-months USD LIBOR rates will permanently cease at the end of 2021, while the remaining USD LIBOR rates will permanently cease immediately after June 2023.

The Group participates as a full member in the above Working Group on Euro Risk Free Rates and has established an internal Benchmark Reform Working Group (the "BR Working Group"), led by senior representatives from the business units across the Bank including Economic Analysis and Research, Global Markets, Group Market and Counterparty Risk, and with the support of Legal, Group Organization & Business Analysis (Regulatory Unit) and Group Finance, in order to manage the transition to the new RFRs, to mitigate any related risks and comply with the regulatory requirements of the EU Benchmarks Regulation (BMR).

The main objectives of the BR Working Group include:

Monitoring of the regulatory, market and industry developments on the Benchmark reform and preparation of the action plans for an orderly transition to the new RFRs,
Assessment and evaluation of implications to the business activity, including proper integration of the new methodologies to calculate the alternative benchmark rates in the core systems, transition of legacy interbank and clients' contracts to the new alternative benchmark rates, or incorporation of fallback provisions as may be required or recommended by the regulatory authorities of financial markets and industry international associations, in existing and newly originated floating rate financial instruments indexed to benchmark rates and appropriate modification of customers' contracts,
Communication to all stakeholders of changes resulting from the IBOR Reform, and
Regular reporting to the Group Assets Liabilities Committee and to the Board Risk Committee when required, in order to assess developments and recommend or approve actions relevant to the Benchmark reform.

The Group has exposure to a significant number of IBOR-linked (EURIBOR, USD LIBOR, CHF LIBOR and EONIA) financial instruments such as derivatives, debt instruments, loans and credit facilities and deposit contracts. Since these benchmark rates are subject to reform there is uncertainty regarding the precise methods of transition to the new benchmarks, as well as the necessary contractual modifications of the financial instruments linked to such benchmarks. Accordingly, the respective transition process to RFRs pose a variety of risks for the Group that include operational, legal and conduct risks considering the compressed timeline for the transition and the large scale of the legacy contracts that need to be modified as well as increases some financial risk in case that markets are disrupted due to the IBOR reform. Additionally, the existing uncertainty on the amount and timing of the cash flows indexed to IBOR could have consequences on the financial instruments' accounting treatment, mainly relating to hedge accounting and hedge designations when existing uncertainties are no longer present.

The Group continuously and systematically evaluates the potential transition risk impacts and adjusts its implementation plans accordingly in order to achieve mitigation of the risks resulting from the transition to the RFRs.

As of 31 December 2020, the Group is exposed to a number of interest rate benchmarks within its hedge accounting relationships that mature after 31 December 2021 or 30 June 2023 for USD LIBOR hedges, when the transition to the new RFRs is expected to be completed. The nominal amount of the hedging instruments designated in these hedge relationships approximates the extent of the risk exposure that the Group manages through hedging relationships.

The table below presents the significant interest benchmarks to which the Group's hedge relationships are exposed along with the nominal amounts of the hedging instruments, maturing after the above mentioned expected cessation dates, as at 31 December 2020:

	31 December 2020 Hedging instruments Impacted by IBOR reform Notional Amounts
	Euribor € million	USD LIBOR € million	CHF LIBOR € million	Other € million
Derivatives designated as fair value hedges
Interest rate swaps	2,664	167	-	61
Cross currency interest rate swaps	4	-	-	-
	2,668	167	-	61
Derivatives designated as cash flow hedges
Interest rate swaps	1,727	-	1,221	-
Cross currency interest rate swaps	-	-	-	-
	1,727	-	1,221	-
Total Derivatives	4,395	167	1,221	61

Regarding EURIBOR rate, which is designated as a critical benchmark under the BMR, and it is BMR compliant since July 2019, its calculation is based on the new "hybrid methodology''. The sustainability of EURIBOR depends on whether the panel of contributing banks continues to support it in the future and there is sufficient activity in its underlying market. Consequently, EURIBOR can continue to be used as a benchmark rate in new and legacy contracts for the foreseeable future and related fair value hedges are not expected to be directly affected by the Benchmark Reform. However, financial instruments referencing EURIBOR need to incorporate new or improved fallback provisions in order to reduce potential uncertainties in the event of EURIBOR's potential cessation. The process for the determination of said fallbacks is in progress, under the Working Group on Euro Risk Free Rates.

With respect to the transition of EONIA and of USD Effective Federal Fund Rate (EFFR), the Group has proceeded to the required changes to its risk systems and valuation methodologies, in order to accommodate the related switch from EONIA to Euro short-term rate (€STR) and from EFFR to Secured Overnight Financing Rate (SOFR) for the discounting curves used in the valuation of interest rate derivatives centrally cleared through LCH clearing house, which was completed in July 2020 and October 2020 respectively and is in contact with its interbank counterparties in order to effect the related necessary changes to its bilateral agreements.

The Group is closely monitoring, evaluating and reviewing the work of international industry associations such as ISDA aimed to guide the benchmark transition process and facilitate compliance to the BMR through the use of "standardized" market solutions and facilitating the bilateral negotiation process across market participants, while reducing the risk of non-orderly transition. In this context, the Bank has adhered to the ISDA 2018 Benchmarks Supplement Protocol as well as the ISDA 2020 IBOR Fallbacks Protocol in Q4 2020.

Furthermore, the Group is taking actions to mitigate the risks, which include new product development and a client outreach programme to ensure readiness to migrate and explain the changes and outcomes arising from the transition to clients.

The Group will continue to monitor the market developments and regulatory guidance relating to the Benchmark Reform and adjust its implementation plans accordingly in order to achieve mitigation of the risks resulting from the transition.

5.3 Fair value of financial assets and liabilities

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal (or most advantageous) market at the measurement date under current market conditions (i.e. an exit price). When a quoted price for an identical asset or liability is not observable, fair value is measured using another valuation technique that is appropriate in the circumstances and maximizes the use of relevant observable inputs and minimizes the use of unobservable inputs. Observable inputs are developed using market data, such as publicly available information about actual events or transactions, and reflect assumptions that market participants would use when pricing financial instruments, such as quoted prices in active markets for similar instruments, interest rates and yield curves, implied volatilities and credit spreads.

The Group's financial instruments measured at fair value or at amortized cost for which fair value is disclosed are categorized into the three levels of the fair value hierarchy based on whether the inputs to the fair values are observable or unobservable, as follows:

(a) Level 1-Financial instruments measured based on quoted prices (unadjusted) in active markets for identical financial instruments that the Group can access at the measurement date. A market is considered active when quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency and represent actually and regularly occurring transactions. Level 1 financial instruments include actively quoted debt instruments held or issued by the Group, equity and derivative instruments traded on exchanges, as well as mutual funds that have regularly and frequently published quotes.
(b) Level 2-Financial instruments measured using valuation techniques with inputs, other than level 1 quoted prices, that are observable either directly or indirectly,such as: i) quoted pricesforsimilar financial instruments in active markets, ii) quoted prices for identical or similar financial instruments in markets that are not active, iii) inputs other than quoted prices that are directly or indirectly observable, mainly interest rates and yield curves observable at commonly quoted intervals, forward exchange rates, equity prices, credit spreads and implied volatilities obtained from internationally recognized market data providers and iv) other unobservable inputs which are insignificant to the entire fair value measurement. Level 2 financial instruments include over the counter (OTC) derivatives, less liquid debt instruments held or issued by the Group and equity instruments.
(c) Level 3-Financial instruments measured using valuation techniques with significant unobservable inputs. When developing unobservable inputs, best information available is used, including own data, while at the same time market participants' assumptions are reflected (e.g. assumptions aboutrisk). Level 3 financial instrumentsinclude unquoted equities or equitiestraded in markets that are not considered active, certain OTC derivatives, loans and advances to customers including securitized notes issued by special purpose entities established by the Group and recognized in financial assets and debt securities issued by the Group.

Financial instruments carried at fair value

The fair value hierarchy categorization of the Group'sfinancial assets and liabilities measured at fair value is presented in the following tables:

	31 December 2020
	Level 1	Level 2	Level 3	Total
	€ million	€ million	€ million	€ million
Securities held for trading	87	-	-	87
Investment securities at FVTPL	54	15	58	127
Derivative financial instruments	0	2,551	1	2,552
Investment securities at FVOCI	5,375	79	-	5,454
Loans and advances to customers mandatorily at FVTPL
	-	-	27	27
Financial assets measured at fair value	5,516	2,645	86	8,247
Derivative financial instruments	0	2,939	-	2,939
Trading liabilities	19	-	-	19
Financial liabilities measured at fair value	19	2,939	-	2,958
	31 December 2019
	Level 1	Level 2	Level 3	Total
	€ million	€ million	€ million	€ million
Securities held for trading	110	0	0	110
Investment securities at FVTPL	48	19	67	134
Derivative financial instruments	0	2,262	0	2,262
Investment securities at FVOCI	6,184	94	-	6,278
Loans and advances to customers mandatorily at FVTPL
	-	-	58	58
Financial assets measured at fair value	6,342	2,375	125	8,842
Derivative financial instruments	0	2,726	-	2,726
Trading liabilities	39	-	-	39
Financial liabilities measured at fair value	39	2,726	-	2,765

The Group recognizes transfers into and out of the fair value hierarchy levels at the beginning of the quarter in which a financial instrument's transfer was effected.

Following the Group's assessment on the significance of the CVA adjustment to the entire fair value measurement of OTC derivative financial instruments, calculated based on internal rating models, the Bank transferred an amount of (a) € 2 million from Level 3 to Level 2 and (b) € 2 million from Level 2 to Level 3.

Reconciliation of Level 3 fair value measurements

	2020	2019
	€ million	€ million
Balance at 1 January	125	118
Arising from acquisition	-	3
Transfers into Level 3	3	0
Transfers out of Level 3	(2)	(0)
Additions, net of disposals and redemptions⁽¹⁾	(32)	(4)
Total gain/(loss) for the year included in profit or loss	(9)	8
Foreign exchange differences and other	1	(0)
Balance at 31 December	86	125

(1) It mainly refers to derecognized loans and advances to customers (note 20).

Group's valuation processes and techniques

The Group's processes and procedures governing the fair valuations are established by the Group Market Counterparty Risk Sector in line with the Group's accounting policies. The Group uses widely recognized valuation models for determining the fair value of common financial instruments that are not quoted in an active market, such as interest and cross currency swaps, that use only observable market data and require little management estimation and judgment. Specifically, observable prices or model inputs are usually available in the market for listed debt and equity securities, exchange-traded and simple over-the-counter derivatives. Availability of observable market prices and model inputs reduces the need for management judgment and estimation and also reduces the uncertainty associated with determining fair values.

Where valuation techniques are used to determine the fair values of financial instruments that are not quoted in an active market, they are validated against historical data and, where possible, against current or recent observed transactions in different instruments, and periodically reviewed by qualified personnel independent of the personnel that created them. All models are certified before they are used and models are calibrated to ensure that outputs reflect actual data and comparative market prices. Fair values' estimates obtained from models are adjusted for any other factors, such as liquidity risk or model uncertainties, to the extent that market participants would take them into account in pricing the instrument. Fair values also reflect the credit risk of the instrument and include adjustments to take account of the credit risk of the Group entity and the counterparty, where appropriate.

Valuation controls applied by the Group may include verification of observable pricing, re-performance of model valuations, review and approval processfor new models and/or changesto models, calibration and back-testing against observable market transactions, where available, analysis ofsignificant valuation movements, etc. Where third parties' valuations are used forfair value measurement, these are reviewed in order to ensure compliance with the requirements of IFRS 13.

The fair values of OTC derivative financial instruments are estimated by discounting expected cash flows using market interest rates at the measurement date. Counterparty creditrisk adjustments and own creditrisk adjustments are applied to OTC derivatives, where appropriate. Bilateral credit risk adjustments consider the expected cash flows between the Group and its counterparties under the relevant terms of the derivative instruments and the effect of the credit risk on the valuation of these cash flows. As appropriate in circumstances, the Group considers also the effect of any credit risk mitigating arrangements, including collateral agreements and master netting agreements on the calculation of credit risk valuation adjustments(CVAs). CVA calculation uses probabilities of default (PDs) based on observable market data such as credit default swaps (CDS) spreads, where appropriate, or based on internal rating models. The Group applies similar methodology for the calculation of debit-value-adjustments (DVAs), when applicable. Where valuation techniques are based on internal rating models and the relevant CVA is significant to the entire fair value measurement, such derivative instruments are categorized as Level 3 in the fair value hierarchy. A reasonably possible change in the main unobservable input (i.e. the recovery rate), used in their valuation, would not have a significant effect on their fair value measurement.

The Group determines fair values for debt securities held using quoted market prices in active markets for securities with similar credit risk, maturity and yield, quoted market prices in non active markets for identical or similar financial instruments, or using discounted cash flows method.

Unquoted equity instruments at FVTPL under IFRS 9 are estimated mainly (i) using third parties' valuation reports based on investees' net assets, where management does not perform any further significant adjustments, and (ii) net assets' valuations, adjusted where considered necessary.

Loans and advances to customers including securitized notes issued by the special purpose entities established by the Group which contractual cash flows do not represent solely payments of principal and interest (SPPI failures), are measured mandatorily at fair value through profit or loss. Quoted market prices are not available as there are no active markets where these instruments are traded. Their fair values are estimated on an individual loan basis by discounting the future expected cash flows over the time period they are expected to be recovered, using an appropriate discount rate or by reference to other comparable assets of the same type that have been transacted during a recent time period. Expected cash flows, which incorporate credit risk, represent significant unobservable input in the valuation and assuch, the entire fair value measurement is categorized as Level 3 in the fair value hierarchy.

Financial instruments not measured at fair value

The fair value hierarchy categorization of the Group's financial assets and liabilities not measured at fair value on the balance sheet, is presented in the following tables:

	31 December 2020
					Carrying
	Level 1	Level 2	Level 3	Fair value	amount
	€ million	€ million	€ million	€ million	€ million
Loans and advances to customers	-	-	37,071	37,071	37,397
Investment securities at amortised cost	1,724	930	-	2,654	2,784
Financial assets not measured at fair value	1,724	930	37,071	39,725	40,181
Debt securities in issue	-	947	592	1,539	1,556
Financial liabilities not measured at fair value	-	947	592	1,539	1,556

			31 December 2019
					Carrying
	Level 1	Level 2	Level 3	Fair value	amount
	€ million	€ million	€ million	€ million	€ million
Loans and advances to customers	-	-	37,057	37,057	37,307
Investment securities at amortised cost	522	691	-	1,213	1,539
Financial assets not measured at fair value	522	691	37,057	38,270	38,846

Debt securities in issue	513	881	944	2,338	2,406
Financial liabilities not measured at fair value	513	881	944	2,338	2,406

The assumptions and methodologies underlying the calculation of fair values of financial instruments not measured at fair value, are in line with those used to calculate the fair values for financial instruments measured at fair value. Particularly:

(a) Loans and advancesto customers including securitized notesissued by special purpose entities established by the Group: for loans and advances to customers, quoted market prices are not available as there are no active markets where these instruments are traded. The fair values are estimated by discounting future expected cash flows over the time period they are expected to be recovered, using appropriate risk-adjusted rates. Loans are grouped into homogenous assets with similar characteristics, as monitored by Management, such as product, borrower type and delinquency status, in order to improve the accuracy of the estimated valuation outputs. In estimating future cash flows, the Group makes assumptions on expected prepayments, product spreads and timing of collateral realization. The discount ratesfor loansto customersincorporate inputsfor expected credit losses and interest rates, as appropriate;
(b) Investment securities measured at amortized cost: the fair values of financial investments are determined using prices quoted in an active market when these are available. In other cases, fair values are determined using quoted market prices for securities with similar creditrisk, maturity and yield, quoted market pricesin non active marketsfor identical orsimilar financial instruments, or by using the discounted cash flows method; and
(c) Debt securities in issue: the fair values of the debt securities in issue are determined using quoted market prices, if available. If quoted prices are not available, fair values are determined based on third party valuations, quotes for similar debt securities or by discounting the expected cash flows at a risk-adjusted rate, where the Group's own credit risk is determined using inputs indirectly observable, i.e. quoted prices of similar securities issued by the Group or other Greek issuers.

For other financial instruments, which are short term or re-price at frequent intervals (cash and balances with central banks, due from credit institutions, due to central banks, due to credit institutions and due to customers), the carrying amounts represent reasonable approximations of fair values.

6. Net interest income

	2020	2019
	€ million	€ million
Interest income
Customers	1,335	1,466
- measured at amortised cost	1,334	1,464
- measured at FVTPL	1	2
Banks and other assets⁽¹⁾⁽³⁾	9	35
Securities	185	187
- measured at amortised cost	44	27
- measured at FVOCI	139	159
- measured at FVTPL	2	1
Derivatives (hedge accounting)	31	51
Derivatives (no hedge accounting)	395	377
	1,955	2,116
Interest expense
Customers ⁽¹⁾	(105)	(183)
Banks ⁽¹⁾⁽²⁾⁽³⁾	(22)	(62)
Debt securities in issue ⁽¹⁾	(92)	(106)
Derivatives (hedge accounting)	(39)	(36)
Derivatives (no hedge accounting)	(345)	(347)
Lease liabilities - IFRS 16	(3)	(5)
	(606)	(739)
Total from continuing operations	1,349	1,377

(1) Measured at amortized cost.

(2) For the year 2020, it includes a benefit of € 21.2 million that is attributable to the targeted longer-term refinancing operations (TLTRO III) of the European Central Bank (note 31).

(3) In 2020, interest from financial assets with negative rates is recorded in interest expense. Comparative information has been adjusted accordingly resulting in a reclassification of € 11 million from interest income to interest expense.

Interest income from continuing operations recognized by quality of Loans and Advances and Product Line is further analyzed below:

		31 December 2020
	Interest income on non-impaired loans and advances	Interest income on impaired loans and advances	Total
	€ million	€ million	€ million
Retail lending	591	120	711
Wholesale lending⁽¹⁾	544	80	624
Total interest income from customers	1,135	200	1,335
		31 December 2019
	Interest income	Interest
	on non-impaired	income on
	loans and	impaired loans
	advances	and advances	Total
	€ million	€ million	€ million
Retail lending	589	230	819
Wholesale lending⁽¹⁾	528	119	647

Total interest income from customers 1,117 349 1,466

(1) Including interest income on loans and advances to Public Sector.

7. Net banking fee and commission income

The following tables include net banking fees and commission income from contracts with customers in the scope of IFRS 15, disaggregated by major type of services and operating segments (note 43).

	31 December 2020
			Global,
			Capital		Other and
			Markets &		Elimination
	Retail	Corporate	Asset Mngt	International	center	Total
	€ million	€ million	€ million	€ million	€ million	€ million
Lending related activities	10	45	6	11	(0)	72
Mutual funds and assets under
management	13	1	28	8	6	55
Network activities and other⁽¹⁾	37	5	21	75	(7)	131
Capital markets	-	5	30	4	0	40
Total from continuing operations	60	56	84	99	(1)	298

	31 December 2019
				Global &		Other and
			Wealth	Capital		Elimination
	Retail	Corporate	Management	Markets	International	center	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Lending related activities	8	44	0	5	12	0	69
Mutual funds and assets under
management	16	1	28	1	8	1	55
Network activities and other ⁽¹⁾	43	13	(0)	13	79	(0)	148
Capital markets	-	12	2	2	4	2	22
Total from continuing operations	67	70	30	21	103	3	294

(1) Including income from credit cards related services.

8. Income from non banking services

Income from non banking servicesincludesrental income of € 84.7 million (2019: € 58.2 million) from real estate properties and other income of € 1.2 million (2019: € 1.3 million) from IT services provided by the Group entities.

9. Net trading income and gains less losses from investment securities

	2020	2019
	€ million	€ million

Debt securities of which:	827	66
- measured at amortised cost	154	0
- measured at FVOCI	668	64
- measured at FVTPL	5	2
Equity securities measured at FVTPL	(9)	36
Gains/(losses) on derivative financial instruments (hedge accounting)	(382)	(8)
Gains/(losses) on derivative financial instruments (no hedge accounting)	3	(37)
Revaluation on foreign exchange positions	(6)	1
Total from continuing operations	433	58

GGBs swap transaction

In December 2020, the Public Debt Management Agency (PDMA), as part of the efficient management of the public debt, proceeded to an offer to repurchase specific Greek government bonds (GGBs) held by the Bank of face value € 1.2 billion (€1.35 billion carrying amount) with remaining tenor from 7 to 21 years, held at the amortised cost portfolio, against a cash consideration of € 1.5 billion equal to their market value. At the same time, the PDMA proceeded to the re-opening of a GGB of face value € 0.5 billion maturing in 2050 that was offered to the Bank against cash consideration of € 0.8 billion, equal to its market value.

The above transaction, offered by the PDMA and carried out at market terms, represents a commercial renegotiation performed in the context of the State's optimum debt management. Considering the purpose of the exchange and the underlying terms, the transaction was accounted for as a substantial modification. Accordingly, the original bonds were derecognized from the Group's balance sheet with a resulting gain of € 139 million, net of any hedging effect. The new GGB was also classified within the hold-tocollect portfolio measured at amortised costsince the business model isto hold to collect its contractual cash flows and the respective contractual terms give rise to cash flows that are solely payments of principal and interest.

10. Other income/ (expenses)

	2020	2019
	€ million	€ million
Gain/(loss) from change in fair value of investment property⁽¹⁾	8	61
Gain arising from the acquisition of Piraeus Bank Bulgaria (note 23)	-	29
Derecognition gain/(loss) on loans measured at amortised cost (note 20)	11	(39)
Fee expense related to the deferred tax credits (note 13)	(6)	(7)
Gain/ (loss) on the disposal/liquidation of subsidiaries (note 23)	220	3
Dividend income	3	2
Gains/(losses) on loans at FVTPL	1	2
Other	(2)	4
Total from continuing operations	235	55

(1) It includes of € 4.2 million gains related to the remeasurement of the interests held in Group's former joint ventures Piraeus Port Plaza 2 and Piraeus Port Plaza 3 (note 23).

11. Operating expenses

	2020	2019
	€ million	€ million
Staff costs	(442)	(481)
Administrative expenses	(240)	(242)
Contributions to resolution and deposit guarantee funds	(78)	(69)
Depreciation of real estate properties and equipment	(38)	(37)
Depreciation of right of use assets	(38)	(41)
Amortisation of intangible assets	(33)	(31)
Total from continuing operations	(869)	(901)

For the year ended 31 December 2020, the amount of operating expenses (excluding any contribution to a deposit guarantee or resolution fund) for the Group's Greek activities was € 586 million (2019: € 632 million).

Contributions to resolution and deposit guarantee funds

In 2016, the Single Resolution Mechanism (SRM), which is one of the pillars of the Banking Union in the euro area alongside the Single Supervisory Mechanism (SSM), became fully operational. The Single Resolution Fund (SRF) was established by the SRM Regulation (EU) No 806/2014 in order to ensure uniform practice in the financing of resolutions within the SRM and it is owned by the Single Resolution Board (SRB). The SRM provides that the SRF will be built up over a period of eight years with 'ex-ante' contributions from the banking industry, which may include irrevocable payment commitments as a part of the total amount of contributions (note 42).

Staff costs

Total from continuing operations	(442)	(481)
Other	(39)	(45)
Additional pension and other post employment costs	(15)	(17)
Social security costs	(60)	(67)
Wages, salaries and performance remuneration	(328)	(352)
	€ million	€ million
	2020	2019

The average number of employees of the Group during the year was 12,624 (2019: 13,390). As at 31 December 2020, the number of branches and business/private banking centers of the Group amounted to 625.

12. Other impairments, restructuring costs and provisions

	2020	2019
	€ million	€ million
Impairment and valuation losses on real estate properties	(14)	(51)
Impairment (losses)/ reversal on bonds	(9)	35
Other impairment losses and provisions⁽¹⁾	(20)	(16)
Other impairment losses and provisions	(43)	(32)
Voluntary exit schemes and other related costs (note 35)	(137)	(63)
Other restructuring costs	(8)	(25)
Restructuring costs	(145)	(88)
Total from continuing operations	(188)	(120)

(1) Includes impairment losses on equipment and software, other assets and provisions on litigations and other operational risk events.

For the year ended 31 December 2020, the Group recognized € 9 million impairment losses on bonds, which is mainly attributable to newly acquired investment securities (note 22.2).

In addition, for the year ended 31 December 2020, the Group recognized € 8 million restructuring costs, mainly related to the Bank's transformation plan. For the comparative period, the Group recognized restructuring costs amounting to € 25 million, of which € 17 million was related with the acquisition of Piraeus Bank Bulgaria A.D., while the remaining costs mainly related to the Bank's transformation plan.

For the year ended 31 December 2019, the Group recognized € 51 million impairment and valuation losses on real estate properties, of which € 39 million relate to the properties' portfolios classified as held for sale (note 30).

13. Income tax

	2020	2019
	€ million	€ million
	(42)	(42)
	(295)	11
Total income tax from continuing operations	(337)	(31)

(1) In 2020, it includes € 160 million write-down of deferred tax assets (DTA) on Bank's loan losses (see below assessment of the recoverability of DTA)

According to Law 4172/2013 currently in force, the nominal Greek corporate tax rate for credit institutions that fall under the requirements of article 27A of Law 4172/2013 regarding eligible DTAs/deferred tax credits (DTCs) against the Greek State is 29%. As of the year 2019 onwards, according to Law 4646/2019 which was enacted in December 2019 and amended Law 4172/2013, the Greek corporate tax rate for legal entities other than the above credit institutions decreased from 29% to 24%. In addition, according to the aforementioned Law 4646/2019, as of 1 January 2020 the withholding tax rate for dividends distributed, other than intragroup dividends, decreased from 10% to 5%. In particular, the intragroup dividends under certain preconditions are relieved from both income and withholding tax.

The nominal corporate tax rates applicable in the banking subsidiaries incorporated in the international segment of the Group (note 43) are as follows: Bulgaria 10%, Serbia 15%, Cyprus 12.5% and Luxembourg 24.94%.

Tax certificate and open tax years

The Company and its subsidiaries, associates and joint ventures, which operate in Greece (notes 23 and 24) have in principle 1 to 6 open tax years. For the open tax year 2015 the Company and the Group's Greek entities, with annual financial statements audited compulsorily, were required to obtain an 'Annual Tax Certificate' pursuant to the Law 4174/2013, which is issued after a tax audit is performed by the same statutory auditor or audit firm that audits the annual financial statements. For fiscal years starting from 1 January 2016 onwards, the 'Annual Tax Certificate' is optional, however, the Company and (as a general rule) the Group's Greek companies will continue to obtain such certificate.

The tax certificates, which have been obtained by the Company and its subsidiaries, associates and joint ventures, which operate in Greece, are unqualified for the open tax years 2015-2019. For the year ended 31 December 2020, the tax auditsfrom external auditors are in progress.

In accordance with the Greek tax legislation and the respective Ministerial Decisions issued, additional taxes and penalties may be imposed by the Greek tax authorities following a tax audit within the applicable statute of limitations (i.e. in principle five years as from the end of the fiscal year within which the relevant tax return should have been submitted), irrespective of whether an unqualified tax certificate has been obtained from the tax paying company. In light of the above, as a general rule, the right of the Greek State to impose taxes up to tax year 2014 (included) has been time-barred for the Company and the Group's Greek entities as at 31 December 2020. On 18 January 2021, the Company received two orders for a tax audit by the tax authorities for the tax years 2015 and 2016. The tax audit is in progress.

The open tax years of the foreign banking entities of the Group are as follows: (a) Eurobank Cyprus Ltd, 2018-2020, (b) Eurobank Bulgaria A.D., 2015-2020, (c) Eurobank A.D. Beograd (Serbia), 2015-2020, and (d) Eurobank Private Bank Luxembourg S.A., 2016-2020. The remaining foreign entities of the Group (notes 23 and 24), which operate in countries where a statutory tax audit is explicitly stipulated by law, have 2 to 6 open tax years in principle, subject to certain preconditions of the applicable tax legislation of each jurisdiction.

Receivables from withholding taxes

Law 4605/2019 (article 93) provided clarifications regarding the treatment of the Bank's withholding tax amounts under Law 2238/1994 (amounting to € 50 million) in a manner thatsafeguards these tax amounts by providing for their offsetting with the Bank's corporate income tax whenever this becomes due.

Law 4605/2019 further addressesthe treatment of tax receivables of Law 4046/2012 (for years 2010, 2011 and 2012), which provides for a five year settlement of tax withheld on interest from GGBs/Tbills/corporate bonds with the Greek State's guarantee against the banks' corporate income tax. In particular, Law 4605/2019 clarified that any remaining amounts (i.e. these withholding taxes that

cannot be offset within the set five-year period) will be then offset against all taxes within ten years in equal installments starting from 1 January 2020. As at 31 December 2020, the remaining amount of the aforementioned Bank's receivables is € 12.3 million.

In reference to its total uncertain tax positions, the Group assesses all relevant developments (e.g. legislative changes, case law, ad hoc tax/legal opinions, administrative practices) and raises adequate provisions.

Deferred tax

Deferred tax is calculated on all deductible temporary differences under the liability method as well as for unused tax losses at the rate in effect at the time the reversal is expected to take place.

The movement on deferred tax is as follows:

	2020	2019
	€ million	€ million
Balance at 1 January	4,757	4,909
Arising from acquisition⁽¹⁾	(8)	-
Income statement credit/(charge) from
continuing operations	(295)	11
Investment securities
at FVOCI	49	(167)
Cash flow hedges	3	2
Discontinued operations (note 30)	-	1
Other	(1)	1
Balance at 31 December	4,505	4,757

(1) It refers to the acquisition of Piraeus Port Plaza 2, Piraeus Port Plaza 3 and Tenberco Properties Development and Exploitation Single Member S.A. (note 23).

Deferred tax assets/(liabilities) are attributable to the following items:

	2020 € million	2019 € million
Impairment/ valuation relating to loans and accounting write-offs PSI+ tax related losses	1,608 1,051	1,592 1,101
Losses from disposals and crystallized write-offs of loans	1,778	1,985
Other impairments/ valuations through the income statement Unused tax losses Costs directly attributable to equity transactions	156 1 8	201 2 16
Cash flow hedges	20	17
Defined benefit obligations	12	14
Real estate properties, equipment and intangible assets	(74)	(47)
Investment securities at FVOCI Other	(142) 87	(191) 67
Net deferred tax	4,505	4,757

The net deferred tax is analyzed as follows:

	2020	2019
	€ million	€ million
Deferred tax assets	4,526	4,766
Deferred tax liabilities (note 35)	(21)	(9)
Net deferred tax	4,505	4,757

Deferred income tax (charge)/credit from continuing operations is attributable to the following items:

	2020	2019
	€ million	€ million

Impairment/ valuation relating to loans, disposals and write-offs⁽¹⁾	(191)	180
Unused tax losses	(1)	(61)
Tax deductible PSI+ losses	(50)	(50)
Change in fair value and other temporary differences	(53)	(58)
Deferred income tax (charge)/credit from continuing operations	(295)	11

(1) In 2020, it includes € 160 million write-down of deferred tax assets (DTA) on Bank's loan losses (see below assessment of the recoverability of DTA)

As at 31 December 2020, the Group recognized net deferred tax assets amounting to € 4.5 billion as follows:

(a) € 1,608 million refer to deductible temporary differences arising from impairment/ valuation relating to loans including the accounting debt write-offs according to the Greek tax law 4172/2013, as in force. These temporary differences can be utilized in future periods with no specified time limit and according to current tax legislation of each jurisdiction;
(b) € 1,051 million refer to losses resulted from the Group's participation in PSI+ and the Greek's state debt buyback program which are subject to amortization (i.e. 1/30 of losses per year starting from year 2012 onwards) for tax purposes;
(c) € 1,778 million refer to the unamortized part of the crystallized tax losses arising from write-offs and disposals of loans, which are subject to amortization over a twenty-year period, according to the Greek tax law 4172/2013, as in force;
(d) € 8 million mainly refer to deductible temporary differences related to the (unamortized for tax purposes) costs directly attributable to Eurobank Ergasias S.A. share capital increases, subject to 10 years' amortization according to tax legislation in force at the year they have been incurred;
(e) € 1 million refer to the unused tax losses of the Company's subsidiaries; and
(f) € 59 million refer to other taxable and deductible temporary differences (i.e. valuation gains/ losses, provisions for pensions and other post-retirement benefits, etc.) the majority of which can be utilized in future periods with no specified time limit and according to the applicable tax legislation of each jurisdiction.

Assessment of the recoverability of deferred tax assets

The recognition of the above presented deferred tax assets is based on management's assessment that the Group's legal entities will have sufficient future taxable profits, against which the deductible temporary differences and the unused tax losses can be utilized. The deferred tax assets are determined on the basis of the tax treatment of each deferred tax asset category, as provided by the applicable tax legislation of each jurisdiction and the eligibility of carried forward losses for offsetting with future taxable profits. Additionally, the Group's assessment on the recoverability of recognized deferred tax assets is based on (a) the future performance expectations(projections of operating results) and growth opportunities relevant for determining the expected future taxable profits, (b) the expected timing of reversal of the deductible and taxable temporary differences, (c) the probability that the Group entities will have sufficient taxable profitsin the future, in the same period asthe reversal of the deductible and taxable temporary differences or in the years into which the tax losses can be carried forward, and (d) the historical levels of Group entities' performance in combination with the previous years' tax losses caused by one off or non-recurring events.

In particular, for the year ended 31 December 2020, the Group has conducted a deferred tax asset (DTA) recoverability assessment based on the three-year Business Plan that was approved by the Board of Directors in December 2020, for the period up to the end of 2023, and was also submitted to the Single Supervisory Mechanism (SSM). For the years beyond 2023, the forecast of operating results was based on the management projections considering the growth opportunities of the Greek economy, the banking sector and the Group itself. Specifically, the management projections for the Group's future profitability adopted in the Business Plan have considered, among others, (a) the impact of the continuing Covid-19 pandemic and the relevant mitigating measures taken by the national and European authorities on the economy and the banking system (note 2) and (b) the planned strategic initiatives, including securitizations of loan portfolios, for the further reduction of the Group's NPEs. As a result of the above, and mainly due to the expected tax impact of the initiatives stated in point (b) on top of the existing securitizations, an amount of € 160 million DTA on loan losses was currently assessed as being non-recoverable and was reversed on 31 December 2020 accordingly.

The Group closely monitors and constantly assesses the developments on the Covid-19 front and their effect on the assumptions used in its plans and the projections for future profitability and will continue to update its estimates accordingly.

Deferred tax credit against the Greek State and tax regime for loan losses

As at 31 December 2020, pursuant to the Law 4172/2013, as in force, the Bank's eligible DTAs/deferred tax credits (DTCs) against the Greek State amounted to € 3,691 million. (31 December 2019: € 3,821 million). The decrease is due to the annual amortization of PSI+ losses and DTC eligible crystallized loan losses from write-offs and disposals. The DTCs will be converted into directly enforceable claims (tax credit) against the Greek State provided that the Bank's after tax accounting result for the year is a loss. In particular, DTCs are accounted for on: (a) the losses from the Private Sector Involvement (PSI) and the Greek State Debt Buyback Program and (b) on the sum of (i) the unamortized part of the crystallized loan losses from write-offs and disposals, (ii) the accounting debt write-offs and (iii) the remaining accumulated provisions and other losses in general due to credit risk recorded up to 30 June 2015.

In accordance with the tax regime, in force, the above crystallized tax losses arising from write-offs and disposals on customers' loans are amortised over a twenty-year period, maintaining the DTC status during all this period, while they are disconnected from the accounting write-offs. Accordingly, the recovery of the Bank's deferred tax asset recorded on loans and advances to customers and the regulatory capitalstructure are safeguarded, contributing substantially to the achievement of the NPEsreduction targets, through the acceleration of write-offs and disposals.

According to tax Law 4172/2013 as in force, an annual fee of 1.5% is imposed on the excess amount of deferred tax assets guaranteed by the Greek State, stemming from the difference between the current tax rate for the eligible credit institutions (i.e. 29%) and the tax rate applicable on 30 June 2015 (i.e. 26%). For the year ended 31 December 2020, an amount of € 6.4 million has been recognized in "Other income/(expenses)".

Income tax reconciliation and unused tax losses

The tax on the Group's profit before tax differs from the theoretical amount that would arise using the applicable tax rates as follows:

	2020	2019
	€ million	€ million

Profit/(loss) before tax from continuing operations	(876)	160
Tax at the applicable tax rate	254	(46)
Tax effect of: - income not subject to tax and non deductible expenses	5	(7)
- effect of different tax rates in different countries	25	29
- write-down of DTA on Bank's loan losses	(160)	-
- other⁽¹⁾	(461)	(7)
Total income tax from continuing operations	(337)	(31)

(1) For 2020, it relates primarily to the effect of Eurobank Holdings's current tax losses (mainly relating to losses arising from the Cairo transaction, note 20) for which deferred tax asset has not been recognized.

As at 31 December 2020, the Company and the Bank have not recognised deferred tax asset (DTA) on unused tax losses amounting to € 480 million (2019: € 233 million for the Bank). The analysis of unrecognized DTA on unused tax losses of the Company and the Bank per year of maturity of related tax losses is presented in the table below:

	Unrecognized
	DTA
	€ million
Year of maturity of unused tax losses
2023	48
2024	68
2025	364
Total	480

14. Earnings per share

Basic earnings per share is calculated by dividing the net profit attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the period, excluding the average number of ordinary shares purchased by the Group and held as treasury shares.

The diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all potentially dilutive ordinary shares. Following the redemption of the preferred securities (Series D) completed on 29 October 2019, the Group has not potentially dilutive ordinary shares (note 39).

		Year ended 31 December
		2020	2019
Net profit/(loss) for the year attributable to ordinary shareholders⁽¹⁾ Net profit/(loss) for the year from continuing operations attributable to	€ million	(1,213)	125
ordinary shareholders⁽¹⁾	€ million	(1,213)	127
Weighted average number of ordinary shares in issue for basic earnings per share	Number of shares	3,707,564,194	3,314,354,719
Earnings/(losses) per share
- Basic and diluted earnings/(losses) per share	€	(0.33)	0.04
Earnings/(losses) per share from continuing operations
- Basic and diluted earnings/(losses) per share	€	(0.33)	0.04

(1) After deducting dividend attributable to preferred securities holders (note 39).

Basic and diluted losses per share from discontinued operations for the year ended 31 December 2020 is nil (2019: € 0.001 basic and diluted losses per share).

On 28 July 2020, the Annual General Meeting of the shareholders of the Company approved the establishment of a five year shares award plan, starting from 2021, in the form of stock options rights by issuing new shares with a corresponding share capital increase, awarded to executives (of the Management) and personnel of the Company and its affiliated companies. The maximum number of rights that can be approved will be 55,637,000 rights, each of which will correspond to one new share, i.e. in case all option rights are exercised up to 55,637,000 new common registered shares of the Company in total will be allocated, corresponding to 1.5% of the current paid share capital. The exercise price of each new share is equal to the nominal value of the share (note 37).

15. Cash and balances with central banks

	2020	2019
	€ million	€ million
Cash in hand	388	451
Balances with central banks	6,249	4,228
Total	6,637	4,679

The Bank and its banking subsidiaries in Eurozone (Cyprus and Luxemburg), are required to hold a minimum level of deposits (minimum reserve requirement - MRR) with their national central bank on an average basis over maintenance periods (i.e. six week periods); these deposits are calculated as 1% of certain liabilities, mainly customers' deposits, and can be withdrawn at any time provided that the MRR is met over the determined period of time. Similar obligations for the maintenance of minimum reserves with their national central bank are also applied to the banking subsidiariesin Bulgaria and Serbia. As at 31 December 2020, the mandatory reserves (i.e. those that the Group entities maintain in order to meet the MRR) and collateral deposits with central banks amounted to € 624 million (2019: € 573 million).

In 2019, the European Central Bank (ECB) decided to introduce a two-tier system for eligible credit institutions' reserve remuneration which exempts part of excess liquidity holdings (i.e. reserve holdings in excess of MRR) from negative deposit facility rate. The exempted part is determined as a multiple of an institution's MRR (current multiplier has been set at 6).

The excess liquidity resulting, among others, from the increase in customers' deposits and ECB funding (notes 33 and 31), contributed to the increase in balances with central banks in 2020.

16. Cash and cash equivalents and other information on cash flow statement

For the purpose of the cash flow statement, cash and cash equivalents comprise the following balances with original maturities of three months or less:

	2020	2019
	€ million	€ million
Cash and balances with central banks (excluding mandatory and collateral deposits with
central banks) (note 15)	6,013	4,106
Due from credit institutions	667	444
Securities held for trading	1	1
Total	6,681	4,551

Other (income)/losses on investment securities presented in continuing operating activities are analyzed as follows:

	2020 € million	2019 € million
Amortisation of premiums/discounts and accrued interest	36	6
(Gains)/losses from investment securities	(430)	(78)
Dividends	(4)	(1)
Total	(398)	(73)

In the year ended 31 December 2020, other adjustments of € 230 million presented in the cash flow statement mainly comprise € 219 million gain on the disposal of FPS (note 30).

Changes in liabilities arising from financing activities

During the year ended 31 December 2020, changesin the Group's liabilities arising from financing activities, other than lease liabilities (note 41), are attributable to: a) debt issuance amounting to € 303 million (net of issuance costs), b) debt repayment amounting to € 1.153 million and c) accrued interest and amortisation of debt issuance costs amounting to € 0.2 million.

17. Due from credit institutions

	2020	2019
	€ million	€ million
Pledged deposits with banks	2,669	2,565
Placements and other receivables from banks	450	198
Current accounts and settlement balances with banks	217	244
Total	3,336	3,007

As at 31 December 2020, the Group's pledged deposits with banks mainly include: a) € 2,546 million cash collaterals on risk mitigation contracts for derivative transactions and repurchase agreements (CSAs, GMRAs), b) € 78 million pledged deposits for the securitized notes issued by the Group's special purpose financing vehicles (note 34) and c) € 45 million cash collateral relating to the sale of the Romanian disposal group (note 30).

The Group's exposure arising from credit institutions, as categorized by counterparty's geographical region, is presented in the following table:

	2020	2019
	€ million	€ million
Greece	30	32
Other European countries	3,107	2,855
Other countries	199	120
Total	3,336	3,007

18. Securities held for trading

	2020	2019
	€ million	€ million
Debt securities (note 5.2.1.3)	42	53
Equity securities	45	57
Total	87	110

19. Derivative financial instruments and hedge accounting

The Group uses derivative financial instruments both for hedging and non-hedging purposes.

The table below presents the fair values of the Group's derivative financial instruments by product type and hedge relationship along with their notional amounts. The notional amounts of derivative instruments provide a basis for comparison with instruments recognized on the balance sheet but do not necessarily indicate the amounts of future cash flows involved or the current fair value of the instruments and, therefore, are not indicative of the Group's exposure at the reporting date.

	31 December 2020 31 December 2019
	Contract /			Contract /
	notional Fair values		notional	Fair values
	amount	Assets	Liabilities	amount	Assets	Liabilities
	€ million	€ million	€ million	€ million	€ million	€ million
Derivatives for which hedge
accounting is not applied/ held for
trading
- Interest rate swaps	28,957	2,473	2,020	25,686	2,203	1,719
- Interest rate options	4,440	37	109	5,617	29	94
- Cross currency interest
rate swaps	118	4	4	216	16	16
- Currency forwards/currency
swaps	2,921	16	50	3,247	8	29
- Currency options	1,155	8	5	104	1	1
- Commodity derivatives	308	7	6	54	2	2
- Credit default swaps	175	-	2	80	1	1
- Other (see below)	51	0	0	69	0	0
		2,545	2,196		2,260	1,862
Derivatives designated as fair value
hedges
- Interest rate swaps	3,051	3	636	3,280	2	769
- Cross currency interest
rate swaps	4	0	0	4	0	1
		3	636		2	770
Derivatives designated as cash flow
hedges
- Interest rate swaps	1,727	1	77	127	-	65
- Cross currency interest
rate swaps	1,682	3	30	2,179	0	29
		4	107		0	94
Total derivatives assets/liabilities		2,552	2,939		2,262	2,726

Other derivative contracts include warrants, exchange traded equity and interest futures and exchange traded equity options.

Information on the fair value measurement and offsetting of derivatives is provided in notes 5.3 and 5.2.1.4, respectively.

In July 2020, the discounting curve of Euro denominated interest rate derivatives centrally cleared through certain central clearing counterparties, changed from EONIA to €STR. The resulted change in the fair value of these instruments was offset by an equal cash

compensation amount, to the party suffering the economic loss from the transition, in order to avoid transfer of value between the two parties. As a result, the change in the discounting curve to €STR did not impact the Group's income statement.

The Group uses certain derivatives and other financial instruments, designated in a qualifying hedge relationship, to reduce its exposure to market risks. The hedging practices applied by the Group, as well as the relevant accounting treatment are disclosed in note 2.2.3. In particular:

(a) Fair value hedges

The Group hedges a proportion of its existing interest rate risk resulting from any potential change in the fair value of fixed rate debt securities held or fixed rate loans, denominated both in local and foreign currencies, using interest rate swaps and cross currency interest rate swaps. In 2020, the Group recognized a gain of € 140 million (2019: € 418 million loss) from changes in the carrying amount of the hedging instruments, used as the basis of recognizing hedge ineffectiveness and € 127 million loss (2019: € 414 million gain) from changes in the carrying amount of the hedged items attributable to the hedged risk. The amount of hedge ineffectiveness recognized for 2020 in income statement was € 13 million gain (2019: € 4 million loss).

(b) Cash flow hedges

The Group hedges a proportion of its existing interest rate and foreign currency risk resulting from any cash flow variability on floating rate performing customer loans or floating rate deposits, denominated both in local and foreign currency, or unrecognized highly probable forecast transactions, using interest rate and cross currency interest rate swaps. For the year ended 31 December 2020, an amount of € 12 million loss was recognised in other comprehensive income in relation to derivatives designated as cash flow hedges. Furthermore, in 2020, the ineffectiveness recognized in the income statement that arose from cash flow hedges was nil (2019: nil).

In addition, the Group uses other derivatives, not designated in a qualifying hedge relationship, to manage its exposure primarily to interest rate and foreign currency risks. Non qualifying hedges are derivatives entered into as economic hedges of assets and liabilities for which hedge accounting was not applied. The said derivative instruments are monitored and have been classified for accounting purposes along with those held for trading.

The Group's exposure in derivative financial assets, as categorized by counterparty's geographical region and industry sector, is presented in the following table:

		31 December 2020
		Other
		European	Other
	Greece	countries	countries	Total
	€ million	€ million	€ million	€ million
Sovereign	1,637	-	-	1,637
Banks	0	400	313	713
Corporate	142	56	4	202
Total	1,779	456	317	2,552

	31 December 2019

		European	Other
	Greece	countries	countries	Total
	€ million	€ million	€ million	€ million
Sovereign	1,545	-	-	1,545
Banks	0	313	289	602
Corporate	113	1	1	115
Total	1,658	314	290	2,262

At 31 December 2020 and 2019, the maturity profile of the nominal amount of the financial instruments designated by the Group in hedging relationships is presented in the tables below:

	31 December 2020
	Fair Value Hedges			Cash Flow Hedges
	3 - 12		Over 5		1 - 3	3 - 12		Over 5
		months 1-5 years	years	Total	months		months 1-5 years	years	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Interest rate swaps	100	470	2,481	3,051	-	-	647	1,080	1,727
Cross currency interest rate
swaps	-	4	-	4	-	461	1,090	131	1,682
Total	100	474	2,481	3,055	-	461	1,737	1,211	3,409

	31 December 2019
	Fair Value Hedges				Cash Flow Hedges
	3 - 12		Over 5		1 - 3	3 - 12		Over 5
	months	1-5 years	years	Total	months	months	1-5 years	years	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Interest rate swaps	30	546	2,704	3,280	-	-	47	80	127
Cross currency interest rate
swaps	-	-	4	4	184	456	1,040	499	2,179
Total	30	546	2,708	3,284	184	456	1,087	579	2,306

(a) Fair value hedges

The following tables present data relating to the hedged items under fair value hedges for the years ended 31 December 2020 and 2019:

	31 December 2020
		Change in
		value as the
		basis for
		recognising
		hedge
amount	hedged item	ineffectiveness
€ million	€ million	€ million
270	21	(2)
1,512	352	62
2,472	199	(187)
		(127)
	Carrying 4,254	Accumulated amount of FV hedge adjustments related to the 572

	31 December 2019
	Accumulated
		amount of FV	Change in value
		hedge	as the basis for
		adjustments	recognising
	Carrying	related to the	hedge
	amount	hedged item	ineffectiveness
	€ million	€ million	€ million
Loans and advances to customers	300	15	2
Debt securities AC	669	290	74
Debt securities FVOCI	3,381	386	338
Total	4,350	691	414

At 31 December 2020, the accumulated amount of fair value hedge adjustments remaining in the balance sheet for any items that have ceased to be adjusted for hedging gains and losses was € 162 million (2019: € 166 million).

(b) Cash flow hedges

The cash flow hedge reserves for continuing hedges as at 31 December 2020 were € 48 million loss (2019: € 37 million loss), of which € 4 million gain (2019: € 3 million gain) relates to loans and advances to customers and € 52 million loss to deposits (2019: € 40 million loss).

As at 31 December 2020, the balances remaining in the cash flow hedge reserve from any cash flow hedging relationships for which hedge accounting is no longer applied was € 21 million loss (2019: € 22 million loss).

The reconciliation of the components of Group's special reserves including cash flow hedges is provided in note 38.

20. Loans and advances to customers

	2020	2019
	€ million	€ million
Loans and advances to customers at amortised cost
- Gross carrying amount	40,874	44,406
- Impairment allowance	(3,477)	(7,099)
Carrying Amount	37,397	37,307
Loans and advances to customers at FVTPL	27	58
Total	37,424	37,365

The table below presents the carrying amount of loans and advances to customers per business unit and per stage as at 31 December 2020:

Lifetime ECL 12-month ECL Lifetime ECL credit Stage 1 Stage 2 impaired⁽¹⁾ Total amount Total amount € million € million € million € million € million Loans and advances to customers at amortised cost Mortgage lending: - Gross carrying amount 7,081 2,791 1,779 11,650 13,982 - Impairment allowance (24) (152) (665) (842) (1,704) Carrying Amount 7,056 2,638 1,114 10,809 12,278 Consumer lending: - Gross carrying amount 2,230 445 732 3,408 3,838 - Impairment allowance (41) (61) (617) (719) (1,055) Carrying Amount 2,189 384 115 2,688 2,783 Small Business lending: - Gross carrying amount 2,200 1,189 1,087 4,476 6,480 - Impairment allowance (35) (119) (520) (674) (1,687) Carrying Amount 2,165 1,070 567 3,802 4,793 Wholesale lending:⁽²⁾⁽³⁾ - Gross carrying amount 17,204 2,012 2,125 21,340 20,106 - Impairment allowance (83) (108) (1,052) (1,242) (2,653) Carrying Amount 17,121 1,904 1,073 20,098 17,453 Total loans and advances to customers at AC - Gross carrying amount 28,714 6,436 5,724 40,874 44,406 - Impairment allowance (183) (439) (2,855) (3,477) (7,099) Carrying Amount 28,531 5,997 2,869 37,397 37,307 Loans and advances to customers at FVTPL Carrying Amount⁽⁴⁾ 27 58 Total 37,424 37,365		31 December 2019

(1) As at 31 December 2020, POCI loans of € 43 million gross carrying amount and € 3.5 million impairment allowance are presented in 'Lifetime ECL creditimpaired' stage (31 December 2019: € 54 million gross carrying amount and € 3.5 million impairment allowance).

(2) Includes € 1,058 million related to the senior notes of the Pillar securitization and € 2,440 million of the Cairo securitization which are under the Hellenic Asset Protection Scheme. The notes have been categorized in Stage 1.

(3) Includes loans to public sector.

(4) Includes € 7.4 million related to the mezzanine notes of the Pillar and Cairo securitizations.

Cairo securitization – loans' derecognition

In December 2019, the Group announced that it has entered into a binding agreement with doValue S.p.A. for the sale of 20% of the mezzanine and 50.1% of the junior notes of a securitization of a mixed portfolio consisting primarily of non-performing loans (NPEs) of ca. € 7.5 billion gross book value. In June 2020, the above sale was completed for a cash consideration of ca. € 14 million.

Upon completion of the sale of 20% of the mezzanine notes that effectively represents the majority stake of Class B1, i.e. 80% of Class B1, the Group ceased to control the SPVs on the basis that it does not have the power to direct their relevant activities that resides with the majority stake of Class B1 noteholders. Accordingly, the Group ceased to consolidate the SPVs in its financial statements. At the same time, the above sale triggered the derecognition assessment of the underlying loan portfolio where it was concluded that the Group, through the holding of 100% of the senior issued at par of face value € 2,409 million, 80% of the mezzanine issued at par of face value € 1,171 million and 49.9% of the junior notes of issue price of €1, retained substantially all risks and rewards of the portfolio's ownership. Accordingly, the Group continued to recognize the underlying loans and the related assets and liabilities in its balance sheet and recognized a financial liability for the consideration received.

On 15 June 2020, Eurobank Holdings, following a decision of the Board of Directors (BoD), proceeded to the contribution of the retained Cairo notes, i.e. 75% of the mezzanine and 44.9% of the junior notes, to the Cyprus-based subsidiary 'Mairanus Ltd', renamed to 'Cairo Mezz Plc'. On 7 July 2020, the BoD of Eurobank Holdings proposed to the General Shareholders' Meeting the distribution of Cairo Mezz Plc sharesto Eurobank Holding'sshareholdersthrough the decrease in kind of itsshare capital. The approval of the General Shareholders' Meeting for the aforementioned corporate action was granted on 28 July 2020. The BoD decision for the contribution of the notes retained by Eurobank Holdings, initiated the distribution process and clearly demonstrated Management's commitment to a specific plan for the notes' disposal as the last step to the Group's Corporate Transformation Plan, and eventually the Cairo loan portfolio's derecognition from its balance sheet. Accordingly, as at 30 June 2020, the Group proceeded with the re-measurement of the portfolio's expected credit losses in accordance with its accounting policy for the impairment of financial assets and recognized an impairment loss of € 1,509 million net of expenses (note 21) in the second quarter of 2020. The impairment loss was based on the fair value of the notes retained by the Group as at 30 June 2020 of € 2,478 million, including the senior notes' accrued income, and the consideration received for the mezzanine notes' disposal to doValue S.p.A. Furthermore, the Group classified as held for sale assetsthe underlying loan portfolio of carrying amount € 2,341 million, comprising loans with gross carrying amount of € 7,259 million which carried an impairment allowance of € 4,918 million after the recognition of the Cairo loss, and the related net securitization's receivables of € 163 million. In addition, the liabilities of the above disposal group classified as held for sale referred to the impairment allowance of the letter of guarantees of € 12 million included in the underlying portfolio and the financial liability of € 14 million for the B1 and C1 notes' disposal.

In September 2020, following the completion of the distribution of the Cairo Mezz Plc shares, the underlying loan portfolio and the related assets and liabilities were derecognized from the Group's balance sheet on the basis that the Group transferred substantially all risks and rewards of the portfolio's ownership and ceased to have control over the portfolio, which resides with the Class B1 noteholders (note 44). In addition, the Group recognized the retained notes on its balance sheet, i.e. 100% of the senior, 5% of mezzanine and junior notes. The above mentioned derecognition of the underlying portfolio resulted in a derecognition gain of € 9 million, which is presented in "other income/ expenses".

Cairo notes	(A) - Eurobank S.A.	(C) = (A) + (B) - Eurobank Holdings Group	(D) - Cairo Mezz Plc	(E) - Third (2) parties	(F) = (C) + (D) + (E) - Total (3) Issue	Valuation price
A Senior	100%	0% 100%	0%	-	100%	100%
B1 Mezzanine	5%	- 5%	-	20%	25%
B2 Mezzanine	-	0% 0%	75%	-	75%
B Total	5%	0% 5%	75%	20%	100%	5%
C1 Junior	5%	- 5%	-	50.1%	55.1%
C2 Junior	-	0% 0%	44.9%	-	44.9%
C Total	5%	0% 5%	44.9%	50.1%	100%	0%

The table below represents the percentage holding of the Cairo notes as at 30 September 2020 as well as their valuation price:

(1) Transferred from Eurobank Ergasias S.A. upon hive down.

(2) Contributed by Eurobank Holdings and subsequently distributed to its shareholders.

(3) Sold to doValue S.p.A.

Pillar securitization – loans' derecognition

In June 2019, the Group announced that it has entered into a binding agreement with Celidoria S.A R.L for the sale of 95% of the mezzanine and junior notes of a securitization of a residential mortgage loan portfolio of ca. € 2 billion gross book value comprising primarily NPEs. As at 30 June 2019, the portfolio comprising loans with gross carrying amount of € 1,987 million, which carried an impairment allowance of € 845 million, was classified as held for sale. The net carrying amount of the loan portfolio amounting to € 1,142 million corresponded to itsimplied valuation based on the nominal value of the senior notes and the sale price of the mezzanine notes according to the terms of the above agreement.

In September 2019, the above transaction was completed for a total consideration of € 102.5 million, of which € 70 million cash and € 32.5 million deferred amount subject to the fulfillment of the terms of the agreement. The final consideration amounted to € 70 million in cash, while the above deferred amount that was previously recognized, was reversed in the fourth quarter of 2019, as the underlying terms and conditions were not fulfilled. The transaction resulted in a de-recognition loss of € 42.3 million including related costs, which was presented in "other income/expenses". Accordingly, the Group ceased to control the SPV ('Pillar Finance Designated Activity Company') and derecognized the underlying loan portfolio in its entirety, on the basis that it transferred substantially all risk and rewards of the underlying loan portfolio's ownership. In addition, the Group recognized the retained notes on its balance sheet, i.e. 100% of the senior, 5% of mezzanine and junior notes.

Law on the conversion of mortgage loans indexed in Swiss Francs, Serbia

As of 25 April 2019, the parliament of Republic of Serbia adopted a new law on the conversion of mortgage loans indexed in Swiss Francs. Pursuant to the aforementioned law, the Serbian banks were obligated to offer the conversion of the remaining debt indexed in CHF into debt indexed in EUR within 30 days from the law's enforcement. The law envisaged a 38% haircut of the converted debt, of which 15% is reimbursed by the Republic of Serbia, while the banks are also entitled to a tax credit of 2% on the amount of the remaining debt. This debt reduction is considered tax deductible pursuant to the local corporate income tax law. The debtors had 30 days to inform the banks if they would accept the above offer, which included the application of the interest rate valid on 31 March 2019 for EUR indexed loans.

In 2019, Eurobank's banking subsidiary in Serbia "Eurobank A.D. Beograd" recognized € 18 million impairment losses relating to loans and advances to customers eligible for conversion under the above law. The total tax effect from the aforementioned conversion including the tax credit of 2% amounted to € 4 million income.

Transactions on lending portfolio (1)

In the second quarter of 2019, the Bank had received a binding offer for the disposal of non-performing corporate loans. Accordingly, loans with gross carrying amount of € 37 million, which carried an impairment allowance of € 29 million, were classified as held for sale, as their sale was considered highly probable. The transaction was completed in the third quarter of 2019 with no effect in the Group's income statement.

(1) Refers to loans that were classified as held for sale and derecognized during the year ended 31 December 2019.

21. Impairment allowance for loans and advances to customers

The following tables present the movement of the impairment allowance on loans and advances to customers (expected credit losses – ECL):

	31 December 2020
	Wholesale			Mortgage			Consumer			Small business
	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	Total € million
Impairment allowance as
at 1 January	64	90	2,499	13	174	1,517	37	44	974	22	99	1,566	7,099
New loans and advances
originated or purchased	26	-	-	1	-	-	9	-	-	17	-	-	54
Transfers between stages			-			-			-			-
- to 12-month ECL	8	(8)	(0)	21	(20)	(0)	9	(7)	(3)	11	(11)	(1)	-
- to lifetime ECL	(16)	28	(12)	(1)	108	(107)	(3)	32	(29)	(2)	33	(30)	-
- to lifetime ECL credit
impaired loans	(1)	(18)	20	(0)	(9)	9	(1)	(6)	7	(0)	(5)	5	-
Impact of ECL net
remeasurement	2	34	610	(3)	(18)	623	(9)	(1)	95	10	51	591	1,983
Recoveries from written -
off loans	-	-	19	-	-	2	-	-	6	-	-	3	30
Loans and advances
derecognised/ reclassified as held for sale during the
year⁽²⁾	(4)	(18)	(1,771)	(7)	(83)	(1,237)	(1)	(1)	(269)	(22)	(48)	(1,475)	(4,937)
Amounts written off⁽³⁾	-	-	(220)	-	-	(97)	-	-	(131)	-	-	(103)	(551)

Unwinding of Discount Foreign exchange and other	-	-	(47)	-	-	(24)	-	-	(12)	-	-	(37)	(120)
movements	4	0	(46)	1	0	(22)	(1)	0	(21)	(0)	0	2	(82)
Impairment allowance as
at 31 December	83	108	1,052	24	152	665	41	61	617	35	119	520	3,477

Eurobank
Holdings

	31 December 2019
	Wholesale			Mortgage			Consumer			Small business
	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	12-month ECL -Stage 1 € million	Lifetime ECL -Stage 2 € million	Lifetime ECL credit impaired⁽¹⁾ € million	Total € million
Impairment allowance as at
1 January	57	111	2,992	35	284	2,228	39	103	1,093	15	213	1,630	8,800
New loans and advances originated or purchased	20	-	4	1	-	0	16	-	0	4	-	0	45
Transfers between stages
- to 12-month ECL - to lifetime ECL not credit	14	(13)	(1)	42	(40)	(2)	32	(29)	(3)	85	(84)	(1)	-
impaired loans - to lifetime ECL credit	(9)	44	(35)	(2)	123	(121)	(9)	47	(38)	(2)	84	(82)	-
impaired loans Impact of ECL net	(1)	(6)	7	(2)	(36)	38	(4)	(21)	25	(1)	(24)	25	-
remeasurement Recoveries from written -	(22)	(45)	196	(48)	(143)	385	(29)	(55)	218	(78)	(91)	218	506
off loans Loans and advances derecognised/reclassified as held for sale during the	-	-	21	-	-	3	-	-	5	-	-	5	34
year	(0)	(0)	(117)	(0)	(14)	(832)	(2)	(1)	(1)	(1)	(0)	4	(964)
Amounts written off	-	-	(514)	-	-	(144)	-	-	(264)	-	-	(161)	(1,083)
Unwinding of Discount Foreign exchange and other	-	-	(74)	-	-	(48)	-	-	(28)	-	-	(67)	(217)
movements	5	(1)	20	(13)	0	10	(6)	0	(33)	(0)	1	(5)	(22)
Impairment allowance as at 31 December	64	90	2,499	13	174	1,517	37	44	974	22	99	1,566	7,099

(1) The impairment allowance for POCI loans of € 3.5 million is included in 'Lifetime ECL credit-impaired' stage (2019: € 3.5 million).

(2) It represents the impairment allowance of loans derecognized during the year due to a) securitization/ sale transactions (note 20) and b) substantial modifications of the loans' contractual terms and those that have been reclassified as held for sale during the year (note 30).

(3) The contractual amount outstanding on lending exposures that were written off during the year ended 31 December 2020 and that are still subject to enforcement activity is € 503 million (2019: € 927 million).

The impairment losses relating to loans and advances to customers recognized in the Group's income statement for the year ended 31 December 2020 amounted to € 2,081 million (2019: € 624 million) and are analyzed as follows:

	2020	2019
	€ million	€ million
Impairment loss on loans and advances to customers	(2,037)	(551)
Modification loss on loans and advances to customers	(31)	(65)
Impairment (loss)/ reversal for credit related commitments	(13)	(8)
Total	(2,081)	(624)

The amount of € 2,081 million includes the Cairo loss transaction of € 1,509 million (note 20). The remaining amount of the recorded impairment losses of € 572 million (31 December 2019: € 624 million, including the impairment lossrecognized due to the Pillar loans' classification as held for sale), includes the impact from the deterioration of the forward-looking information applied to the measurement of the expected credit losses (ECL) as those were revised due to the expected large-scale negative effect of the Covid-19 crisis to the economies in which the Group operates as well as the impact from the anticipated non performing loans' inflows in 2021 that is temporarily delayed due to the borrowers' relief measures and the ongoing government support (note 3.1).

In particular, the impairment losses recognized by the Group for the year ended 31 December 2020 remained well above their expected amount at the end of 2019, due to the exceptional Covid-19 pandemic circumstances and the prevailing uncertainties regarding the timing and the prospects of the economy'srecovery (note 2). More specifically, the Group initially expected a significant decrease in the impairment levels for 2020, driven by the improvement in the before Covid-19 macroeconomic environment, the positive impact on the Group's lending portfolios from the acceleration of its non performing exposures (NPE) de-leveraging program, as well as, the expected outcome from other recovery measures, employed as part of its NPE managementstrategy (note 2). However, given the new conditions arising from the Covid-19 outbreak, the Group's cost of risk(1) for the year ended 31 December 2020 increased to 1.52%, compared to the pre-Covid-19 estimate for 2020 of 0.9%.

As described in note 3.1, the Group continues to monitor closely and constantly re-assesses all the latest available information considering the high uncertainty, arising from the consecutive rounds of lockdowns and their negative effect on the economies in which the Group operates, the nature, size and effectiveness of the government support measures, as well as, the consumer and investment post-crisis behavioral impact.

(1) Cost of risk represents the Group's Impairment losses relating to loans and advances charged in the reported period excluding the loss on Cairo transaction, divided by the average balance of loans and advances to customers at amortised cost

22. Investment securities

	2020	2019
	€ million	€ million
Investment securities at FVOCI	5,454	6,278
Investment securities at amortised cost	2,784	1,539
Investment securities at FVTPL	127	134
Total	8,365	7,951

22.1 Movement of investment securities

The tables below present the movement of the carrying amount of investment securities per measurement category and per stage:

	31 December 2020
					Investment
				Investment securities at amortised	securities at
	Investment securities at FVOCI			cost	FVTPL
	12-month ECL	Lifetime ECL	12-month ECL	Lifetime ECL
	Stage 1	Stage 2	Stage 1	Stage 2		Total
	€ million	€ million	€ million	€ million	€ million	€ million
Gross carrying amount at 1
January	6,278	-	1,542	-	134	7,954
Additions, net of disposals and
redemptions	(1,020)	-	1,170	-	(6)	144
Transfers between stages	(10)	10	-	-	-	-
Net gains/(losses) from changes in
fair value for the year	301	1	-	-	(1)	301
Amortisation of
premiums/discounts and interest	(51)	0	15	-	0	(36)
Changes in fair value due to
hedging	-	-	62	-	-	62
Exchange adjustments and other
movements	(54)	(1)	0	-	(0)	(55)
Gross carrying amount at 31
December	5,444	10	2,789	-	127	8,370
Impairment allowance	-	-	(5)	-	-	(5)
Net carrying amount at 31
December	5,444	10	2,784	-	127	8,365

	31 December 2019
	Investment securities at FVOCI			Investment securities at amortised cost	Investment securities at FVTPL
	12-month ECL	Lifetime ECL	12-month ECL	Lifetime ECL
	Stage 1	Stage 2	Stage 1	Stage 2		Total
	€ million	€ million	€ million	€ million	€ million	€ million
Gross carrying amount at 1
January	6,222	26	697	754	104	7,803
Arising from acquisition (note 23)	28	-	-	-	3	31
Additions, net of disposals and
redemptions	(985)	-	12	-	7	(966)
Transfers between stages	26	(26)	754	(754)	-	-
Net gains/(losses) from changes in
fair value for the year	989	-	-	-	19	1,008
Amortisation of
premiums/discounts and interest	(14)	-	8	-	(0)	(6)
Changes in fair value due to
hedging	-	-	70	-	-	70
Exchange adjustments and other movements	12	-	1	-	1	14
Gross carrying amount at 31
December	6,278	-	1,542	-	134	7,954
Impairment allowance	-	-	(3)	-	-	(3)
Net carrying amount at 31
December	6,278	-	1,539	-	134	7,951

22.2 Movement of ECL

The table below presents the ECL movement per portfolio, including ECL movement analysis per stage:

	31 December 2020			31 December 2019
	Measured at	Measured at		Measured at	Measured at
	amortised cost	FVOCI	Total	amortised cost	FVOCI	Total
	€ million	€ million € million		€ million	€ million € million
Balance at 1 January	3	9	12	31	17	48
New financial assets purchased	6	5	11	0	4	4
- of which 12-month ECL-Stage 1	6	5	11	0	4	4
Remeasurement due to transfers
from lifetime
ECL-Stage 2 to 12-month ECL
Stage 1	-	-	-	(28)	(1)	(29)
Remeasurement due to transfers
from 12-month ECL to lifetime
ECL-Stage 2	-	1	1	-	-	-
Remeasurement due to change in
ECL risk parameters	(2)	(1)	(3)	0	(9)	(9)
- of which 12-month ECL-Stage 1	(2)	(1)	(3)	0	(9)	(9)
- of which lifetime ECL-Stage 2	-	(0)	(0)	-	-	-
Financial assets disposed during
the year	(2)	(3)	(5)	(0)	(2)	(2)
- of which 12-month ECL-Stage 1	(2)	(3)	(5)	(0)	(2)	(2)
Financial assets redeemed during
the year	(0)	(0)	(0)	(0)	(0)	(0)
Foreign exchange and other
movements	-	(1)	(1)	-	0	0
Balance as at 31 December	5	10	15	3	9	12

22.3 Equity reserve: revaluation of the investment securities at FVOCI

Gains and losses arising from the changes in the fair value of investment securities at FVOCI are recognized in a corresponding revaluation reserve in equity. The movement of the reserve is as follows:

	2020	2019
	€ million	€ million
Balance at 1 January	557	95
Net gains/(losses) from changes in fair value	302	989
Tax (expense)/benefit	(86)	(284)
Revaluation reserve from associated undertakings, net of tax	(18)	47
	198	752
Net (gains)/losses transferred to net profit on disposal	(666)	(63)
ECL transferred to net profit	4	(6)
Tax (expense)/benefit on net (gains)/losses transferred to net profit on disposal	191	17
Tax (expense)/benefit on ECL transferred to net profit	(1)	2
	(472)	(50)
Net (gains)/losses transferred to net profit from fair value hedges	187	(338)
Tax (expense)/benefit	(55)	98
	132	(240)
Balance at 31 December	415	557

23. Group composition

The following is a listing of the Company's subsidiaries at 31 December 2020, included in the consolidated financial statements for the year ended 31 December 2020:

Name	Note	Percentage holding	Country of incorporation	Line of business
Eurobank S.A.	a	100.00	Greece	Banking
Be Business Exchanges S.A. of Business Exchanges Networks and Accounting and Tax Services		98.01	Greece	Business-to-business e-commerce, accounting, tax and sundry services
Eurobank Asset Management Mutual Fund Mngt Company Single Member S.A.⁽²⁾		100.00	Greece	Mutual fund and asset management
Eurobank Equities Investment Firm Single Member S.A.⁽²⁾		100.00	Greece	Capital markets and advisory services
Eurobank Ergasias Leasing Single Member S.A.⁽²⁾		100.00	Greece	Leasing
Eurobank Factors Single Member S.A.		100.00	Greece	Factoring
Hellenic Post Credit S.A.		50.00	Greece	Credit card management and other services
Herald Greece Single Member Real Estate development and services S.A. 1		100.00	Greece	Real estate
Herald Greece Single Member Real Estate		100.00	Greece	Real estate
development and services S.A. 2
Standard Single Member Real Estate S.A.⁽²⁾	p	94.10	Greece	Real estate
Cloud Hellas Single Member Ktimatiki S.A.⁽²⁾		100.00	Greece	Real estate
Piraeus Port Plaza 1 Single Member Development S.A.⁽²⁾		100.00	Greece	Real estate
(Under liquidation) Real Estate Management Single Member S.A.	m	100.00	Greece	Real estate services
(Under liquidation) Anchor Hellenic Investment Holding Single Member S.A.	m	100.00	Greece	Real estate
Vouliagmeni Residence Single Member S.A.		100.00	Greece	Real estate
Athinaiki Estate Investments Single Member S.A.		100.00	Greece	Real estate
Piraeus Port Plaza 2 Development S.A.	k	100.00	Greece	Real estate
Piraeus Port Plaza 3 Development S.A.	l	100.00	Greece	Real estate
Tenberco Properties Development and Exploitation Single Member S.A.	o	100.00	Greece	Real estate
Eurobank Bulgaria A.D.	c	99.99	Bulgaria	Banking
IMO 03 E.A.D.		100.00	Bulgaria	Real estate services
IMO Property Investments Sofia E.A.D.		100.00	Bulgaria	Real estate services
ERB Hellas (Cayman Islands) Ltd		100.00	Cayman Islands	Special purpose financing vehicle
Berberis Investments Ltd		100.00	Channel Islands	Holding company
Eurobank Cyprus Ltd		100.00	Cyprus	Banking
ERB New Europe Funding III Ltd		100.00	Cyprus	Finance company
Foramonio Ltd		100.00	Cyprus	Real estate
NEU 03 Property Holdings Ltd		100.00	Cyprus	Holding company
NEU Property Holdings Ltd		100.00	Cyprus	Holding company
Lenevino Holdings Ltd		100.00	Cyprus	Real estate
Rano Investments Ltd		100.00	Cyprus	Real estate
Neviko Ventures Ltd		100.00	Cyprus	Real estate
Staynia Holdings Ltd		100.00	Cyprus	Holding company
Zivar Investments Ltd		100.00	Cyprus	Real estate
Amvanero Ltd		100.00	Cyprus	Real estate
Ragisena Ltd		100.00	Cyprus	Real estate
Revasono Holdings Ltd		100.00	Cyprus	Real estate
Volki Investments Ltd		100.00	Cyprus	Real estate
Adariano Investments Ltd	g	100.00	Cyprus	Real estate
Elerovio Holdings Ltd	g	100.00	Cyprus	Real estate
Sagiol Ltd	k	100.00	Cyprus	Holding company
Macoliq Holdings Ltd	l	100.00	Cyprus	Holding company
Eurobank Private Bank Luxembourg S.A.		100.00	Luxembourg	Banking
Eurobank Fund Management Company (Luxembourg) S.A.		100.00	Luxembourg	Fund management
Eurobank Holding (Luxembourg) S.A.		100.00	Luxembourg	Holding company
ERB Lux Immo S.A.		100.00	Luxembourg	Real estate

		Percentage	Country of
Name	Note	holding	incorporation	Line of business
Grivalia New Europe S.A.⁽¹⁾		100.00	Luxembourg	Real estate
ERB New Europe Funding B.V.		100.00	Netherlands	Finance company
ERB New Europe Funding II B.V.		100.00	Netherlands	Finance company
ERB New Europe Holding B.V.		100.00	Netherlands	Holding company
ERB IT Shared Services S.A.		100.00	Romania	Informatics data processing
IMO Property Investments Bucuresti S.A.		100.00	Romania	Real estate services
IMO-II Property Investments S.A.		100.00	Romania	Real estate services
Eliade Tower S.A.		99.99	Romania	Real estate
Retail Development S.A.		99.99	Romania	Real estate
Seferco Development S.A.		99.99	Romania	Real estate
Eurobank A.D. Beograd		99.99	Serbia	Banking
ERB Leasing A.D. Beograd-In Liquidation		99.99	Serbia	Leasing
IMO Property Investments A.D. Beograd		100.00	Serbia	Real estate services
Reco Real Property A.D. Beograd		100.00	Serbia	Real estate
ERB Istanbul Holding A.S.		100.00	Turkey	Holding company
ERB Hellas Plc		100.00	United Kingdom	Special purpose financing vehicle
Karta II Plc		-	United Kingdom	Special purpose financing vehicle
Themeleion II Mortgage Finance Plc⁽¹⁾		-	United Kingdom	Special purpose financing vehicle
Themeleion III Mortgage Finance Plc⁽¹⁾		-	United Kingdom	Special purpose financing vehicle
Themeleion IV Mortgage Finance Plc⁽¹⁾		-	United Kingdom	Special purpose financing vehicle
Themeleion Mortgage Finance Plc⁽¹⁾		-	United Kingdom	Special purpose financing vehicle
Maximus Hellas Designated Activity Company		-	Ireland	Special purpose financing vehicle
Astarti Designated Activity Company		-	Ireland	Special purpose financing vehicle
ERB Recovery Designated Activity Company	i	-	Ireland	Special purpose financing vehicle

(1) Entity under liquidation at 31 December 2020.

(2) In the context of the Greek Law 4548/2018, the legal name of the company has been amended or is in the process of being amended with the inclusion of the term "Single member".

The Group holds half of the voting rights of Hellenic Post Credit S.A. which is fully consolidated. The Bank with the consent of the other shareholder who holds the remaining 50% of the share capital, has appointed the majority of the Board's directors and directs the current operations that significantly affect the returns of the company.

The following entities are not included in the consolidated financial statements mainly due to immateriality:

(i) Holding and other entities of the Group'sspecial purpose financing vehicles: (a) Themeleion III Holdings Ltd, Themeleion IV Holdings Ltd, Themeleion V Mortgage Finance Plc, Themeleion VI Mortgage Finance Plc, Anaptyxi APC Ltd and Byzantium II Finance Plc, which are under liquidation and (b) Karta II Holdings Ltd.

(ii) Dormant entity: Enalios Real Estate Development S.A.

(iii) Entities controlled by the Group pursuant to the terms of the relevant share pledge agreements: Finas S.A., Rovinvest S.A., Provet S.A. and Promivet S.A.

In 2020, the changes in the Group structure due to: a) the demerger of Eurobank Ergasias, b) acquisitions, mergers and establishment of companies, c)sales and other corporate actions, which resulted in loss of control, d) transactions with the non-controlling interests, which did not result in loss of control and e) liquidations, are as follows:

(a) Eurobank S.A., Greece

On 20 March 2020, Eurobank Ergasias S.A. ("Eurobank Ergasias" or "the Demerged Entity") announced that the demerger of Eurobank Ergasias through banking sector's hive down and establishment of a new company-credit institution ("Demerger") under the corporate name "Eurobank S.A." ("the Beneficiary") was approved. Following the approval of the Demerger, the Demerged Entity, which as of 23 March 2020 was renamed to "Eurobank Ergasias Services and Holdings S.A.", became the sole shareholder of the Beneficiary by acquiring all of its issued shares. Further information is provided in note 44.

(b) Eurobank FPS Loans and Credits Claim Management S.A., Greece

In June 2020, in the context of the binding agreements that Eurobank Ergasias S.A. had entered into with doValue S.p.A. in December 2019, the Bank sold 80% of its subsidiary then named Eurobank FPS Loans and Credits Claim Management S.A. - project "Europe". Further information is provided in note 30.

(c) ERB Leasing Bulgaria EAD, Bulgaria

In February 2020, the legal merger of Eurobank Bulgaria A.D. and ERB Leasing Bulgaria EAD, by absorption of the latter by the former was announced.

(d) CEH Balkan Holdings Ltd, Cyprus

The dissolution of the company was completed in January 2020.

(e) Special purpose financing vehicles for the securitization of Bank loans and related real estate companies – Project "Cairo"

Οn 5 June 2020, the Company announced that the sale of a portion of mezzanine and junior securitization notes of the € 7.5 billion multi-asset NPE securitization (project "Cairo"), has been completed (note 34). Following the above, the Company ceased to have control over the related special purpose financing vehicles (Cairo No. 1 Finance Designated Activity Company, Cairo No. 2 Finance Designated Activity Company, Cairo No. 3 Finance Designated Activity Company) and the related real estate companies (Cairo Estate I Single Member S.A., Cairo Estate II Single Member S.A., Cairo Estate III Single Member S.A.), and as a result they were not included in the consolidated financial statements for the year ended 31 December 2020.

(f) ERB Hellas Funding Ltd, Channel Islands

In June 2020, the liquidation of the company was decided and its dissolution was completed in December 2020.

(g) Adariano Investments Ltd and Elerovio Holdings Ltd, real estate companies, Cyprus

In the context of the management of its NPEs, in the second quarter of 2020, the Bank's subsidiary Eurobank Cyprus Ltd established the wholly owned subsidiaries, Adariano Investments Ltd and Elerovio Holdings Ltd, to operate as real estate companies in Cyprus.

(h) Cairo Mezz Plc, portfolio company, Cyprus

In June 2020, the Company acquired 100% of the shares of Mairanus Ltd for a cash consideration of € 2 thousand. In the same month, the Company following the respective decision by its Board of Directors, contributed cash of € 1.5 million and the retained Cairo notes of fair value € 56 million in exchange for newly-issued shares of Mairanus Ltd, which in September 2020 was renamed to Cairo Mezz Plc. In addition, in September 2020, the above shares were distributed to Eurobank Holdings shareholders, as the last step of the Cairo transaction (note 44) and as a result Cairo Mezz Plc was not included in the consolidated financialstatementsfor the year ended 31 December 2020.

(i) ERB Recovery Designated Activity Company, Ireland

In June 2020, the Bank established ERB Recovery Designated Activity Company, a special purpose financing vehicle for the securitization of a portfolio of mortgage, consumer, SME (small and medium enterprise) and corporate loans.

(j) Eurobank Finance S.A., Romania

The distribution of the company's surplus assets to its shareholders and its dissolution were completed in July and October 2020, respectively.

(k) Sagiol Ltd, Cyprus and Piraeus Port Plaza 2, Greece

In July 2020, the Bank acquired 100% of the shares and voting rights of Sagiol Ltd for a cash consideration of € 9.1 million. The acquisition was accounted for as a business combination using the purchase method of accounting. At the date of acquisition, the fair value of the total assets amounted to € 9.2 million referring to 51% of the shares and voting rights of the Group's joint venture Piraeus Port Plaza 2, while total liabilities amounted to € 0.01 million. The resulting gain of € 0.07 million has been recognized in "Other income/(expenses)". Following the above transaction, Piraeus Port Plaza 2 became a wholly owned subsidiary of the Bank. In accordance with the requirements for business combinations achieved in stages, the Group has remeasured its previously held interest of 49% in Piraeus Port Plaza 2 at fair value of € 8.8 million, with a resulting gain of € 1.9 million that was recognized in "Other income/(expenses)".

(l) Macoliq Holdings Ltd, Cyprus and Piraeus Port Plaza 3, Greece

In October 2020, the Bank acquired 100% of the shares and voting rights of Macoliq Holdings Ltd for a cash consideration of € 12.5 million. The acquisition was accounted for as a business combination using the purchase method of accounting. At the date of acquisition, the fair value of the total net assets amounted to € 12.1 million referring to 51% of the shares and voting rights of the

Group's joint venture Piraeus Port Plaza 3. Accordingly, the resulting goodwill asset amounted to € 0.4 million. Following the above transaction, Piraeus Port Plaza 3 became a wholly owned subsidiary of the Bank. In accordance with the requirements for business combinations achieved in stages, the Group has remeasured its previously held interest of 49% in Piraeus Port Plaza 3 at fair value of € 11.6 million, with a resulting gain of € 2.3 million that was recognized in "Other income/(expenses)".

(m) (Under liquidation) Real Estate Management Single Member S.A. and (Under liquidation) Anchor Hellenic Investment Holding Single Member S.A., Greece

In December 2020, the liquidation of the companies was decided.

(n) Tegea Holdings Ltd, Tegea Plc, Anaptyxi SME I Holdings Ltd and Anaptyxi SME I Plc, UK

In the fourth quarter of 2020, the liquidation of the special purpose financing vehicles was completed.

(o) Tenberco Properties Development and Exploitation Single Member S.A., Greece

In December 2020, the Bank acquired 100% of the shares and voting rights of Tenberco Properties Development and Exploitation Single Member S.A. for a cash consideration of € 27.1 million. At the date of acquisition, the fair value of the total assets amounted to € 30.6 million, while total liabilities amounted to € 1.4 million, mainly consisting of a deferred tax liability arising from the fair value measurement of the assets acquired. Accordingly, the effect of the transaction was € 2.2 million gain, which has been recognized in "Other income/(expenses)".

(p) Standard Single Member Real Estate S.A., Greece

In December 2020, following the capitalization of the company's finance lease liability, the Group's percentage holding in the company's share capital decreased from 100% to 94.10%. The transaction resulted in a) a gain of € 0.7 million that was recognized directly in the equity attributable to the shareholders of Eurobank Holdings and b) the increase of non controlling interests by € 0.1 million.

In 2019, the changes in the Group structure due to: a) acquisitions, mergers and establishment of companies, b) sales and other corporate actions, which resulted in loss of control and c) transactions with the non-controlling interests, which did not result in loss of control, are as follows:

(i) Eurobank Property Services S.A., Greece, Eurobank Property Services S.A., Romania and ERB Property Services d.o.o. Beograd, Serbia

In January 2019, the Bank and Cerved Credit Management Group S.r.l. (Cerved) signed a binding agreement in the context of which Cerved would acquire the entire share capital of Eurobank Property Services S.A. in Greece (EPS) and itssubsidiaries Eurobank Property Services S.A. in Romania and ERB Property Services d.o.o. Beograd in Serbia from Eurobank. EPS Greece has also been appointed as real estate servicer for Eurobank for the next five years with respect to all real estate valuation activities and otherservices. The transaction was completed in April 2019 via the acquisition from Cerved, for a consideration of € 8 million, of the entire share capital of EPS with a resulting gain of € 1.3 million recognized in "other income/expenses". Further consideration of up to € 5 million in the form of earn – out will be due upon reaching certain economic results and conditions in the timeframe until 2023. The transaction was in line with the Bank's strategy to focus on its core operations, adopting an outsourcing business model in relation to real estate services.

(ii) Modern Hoteling, Greece

In February 2019, the Bank signed a pre- agreement with third party for the disposal of its participation (100%) in Modern Hoteling. Based on the above agreement, a share capital increase took place in March 2019, which was covered by the purchaser in order for the company's debt to be fully repaid to the Bank. Upon completion of the share capital increase, the Bank's participation in the company decreased to 41% and based on the relevant share purchase agreement signed in the same month, the disposal of the company was completed, with a resulting gain of € 2.1 million recognized in "other income/expenses".

(iii) Piraeus Bank Bulgaria A.D. and Piraeus Insurance Brokerage EOOD, Bulgaria

In June 2019, the acquisition of Piraeus Bank Bulgaria A.D. ("PBB"), a subsidiary of Piraeus Bank, by Eurobank's subsidiary in Bulgaria, Eurobank Bulgaria A.D. ("Postbank") was completed, after all necessary approvals from the competent authorities were obtained. In particular, Postbank acquired 99.9819% of the shares and voting rights of PBB and, accordingly, indirect participation in PBB's wholly-owned subsidiary Piraeus Insurance Brokerage EOOD. The acquisition was accounted for as a business combination using the purchase method of accounting and resulted in a gain of € 29 million that was attributed to

the particular circumstances of the acquisition, in line with the restructuring plan of the seller and Eurobank's strategy to focus on specific international markets, and had been recognized in 'Other income/(expenses)'. In the fourth quarter of 2019, the mergers of i) PBB with Postbank and ii) Piraeus Insurance Brokerage EOOD with ERB Leasing Bulgaria EAD, by absorption of the former by the latter, were completed. Further information in relation to the acquisition of PBB is provided in note 23.3 of the consolidated financial statements for the year ended 31 December 2019.

(iv) Grivalia Properties REIC S.A.

On 5 April 2019, the Extraordinary General Meeting of the shareholders of Eurobank resolved, among others(a) the approval of the Merger of the Bank with Grivalia by absorption of the latter by the former, (b) the approval of the Draft Merger Agreement, as it was approved by the BoD of the merging companies and (c) the increase of the share capital of the Bank by € 197 million (note 37). The Merger was accounted for as a business combination using the purchase method of accounting. The consideration of the transaction amounting to € 1,093.9 million has been calculated as the fair value of the 1,523,163,087 Eurobank new ordinary shares with reference to Eurobank's share market price on the acquisition date (i.e. € 0.7185) less the fair value of the new Eurobank shares issued corresponding to the Grivalia shares held by the Bank's subsidiary ERB Equities. The difference between: (a) the total consideration of € 1,093.9 million and the fair value of the Group's previously held equity interest in Grivalia of € 0.4 million, and (b) the net identifiable assets acquired of € 872 million, resulted in the recognition of a goodwill of € 222 million, which was impaired by € 62 million in the year ended 31 December 2019 (note 28). Following the Merger, Eurobank's equity increased by € 1,087 million net of € 7 million related costs. In addition following the above, Eurobank obtained control of Grivalia's subsidiaries. Further information in relation to the merger of the two companies is provided in note 23.2 of the consolidated financial statements for the year ended 31 December 2019.

(v) Vouliagmeni Residence Single Member S.A., Greece

In July 2019, the Bank established the wholly owned subsidiary Vouliagmeni Residence Single Member S.A., a real estate company operating in Greece.

In the year ended 31 December 2019, in the context of the management of the Group's non performing exposures (NPEs), the following wholly owned subsidiaries were established:

(vi) Special purpose financing vehicles for the securitization of Bank loans and related real estate companies

Cairo No. 1 Finance Designated Activity Company, Cairo No. 2 Finance Designated Activity Company, Cairo No. 3 Finance Designated Activity Company and Pillar Finance Designated Activity Company, Ireland.
Cairo Estate I Single Member S.A., Cairo Estate II Single Member S.A., Cairo Estate III Single Member S.A., Pillar Estate Single Member S.A. and Real Estate Management Single Member S.A., Greece

Following the completion of the Pillar transaction (note 20), the Bank had no control over the special purpose financing vehicle Pillar Finance Designated Activity Company and the related real estate company Pillar Estate Single Member S.A., and as a result they were not included in the consolidated financialstatements as of the period ended 30 September 2019.

(vii) Anchor Hellenic Investment Holding Single Member S.A., real estate company, Greece

In the third quarter of 2019, Anchor Hellenic Investment Holding Single Member S.A. acquired the whole of the issued share capital and voting rights of Rhodes Marines S.A. In the same period, the disposal of the holding in Rhodes Marines S.A. along with the Group's lending exposures to the company was completed, with no effect in the Group's income statement.

(viii) Zivar Investments Ltd, Amvanero Ltd, Ragisena Ltd, Revasono Holdings Ltd and Volki Investments Ltd, real estate companies, Cyprus

(ix) Athinaiki Estate Investments Single Member S.A., real estate company, Greece

(x) ERB Leasing Bulgaria EAD, Bulgaria

In the third quarter of 2019, the Bank disposed its participation in ERB Leasing Bulgaria EAD to Eurobank Bulgaria A.D., where the Group's percentage holding was 99.99% and thus, the Group participation to the company decreased from 100% to 99.99%.

(xi) Bulgarian Retail Services A.D., Bulgaria

In November 2019, the shareholders of Bulgarian Retail Services A.D. (including the Bank and ERB New Europe Holding B.V.) disposed their participation in the company to Eurobank Bulgaria A.D., where the Group's percentage holding is 99.99% and thus, the Group participation to Bulgarian Retail Services A.D. decreased from 100% to 99.99%. In the same month, the merger of Bulgarian Retail Services A.D. and ERB Leasing Bulgaria E.A.D. by absorption of the former by the latter, was completed. The transaction was accounted for in the Group's financial statements by using the pooling of interests method (also known as merger accounting) with no effect in the said statements.

(xii) ERB Property Services Sofia E.A.D.

In December 2019, Eurobank Bulgaria A.D. disposed its participation interest of 100% in ERB Property Services Sofia E.A.D. to a third party for a cash consideration of € 2.1 million. The resulting gain on the disposal was immaterial.

Post balance sheet event

Grivalia New Europe S.A., Luxembourg

In January 2021, the liquidation of the company was completed.

Significant restrictions on the Group's ability to access or use the assets and settle the liabilities of the Group

The Group does not have any significant restrictions on its ability to access or use its assets and settle its liabilities other than those resulting from regulatory, statutory and contractual requirements, set out below:

Banking and other financial institution subsidiaries are subject to regulatory restrictions and central bank requirements in the countries in which the subsidiaries operate. Such supervisory framework requires the subsidiaries to maintain minimum capital buffers and certain capital adequacy and liquidity ratios, including restrictions to limit exposures and/or the transfer of funds to the Company and other subsidiaries within the Group. Accordingly, even if the subsidiaries' financial assets are not pledged at an individual entity level, their transfer within the Group may be restricted under the existing supervisory framework. As at 31 December 2020, the carrying amount of the Group financial institution subsidiaries' assets and liabilities, before intercompany eliminations, amounted to € 74.3 billion and € 68 billion, respectively, including Eurobank S.A. (2019: € 17.2 billion and € 15.2 billion).

Subsidiaries are subject to statutory requirements mainly relating with the level of capital and total equity that they should maintain, restrictions on the distribution of capital and special reserves, as well as dividend payments to their ordinary shareholders. Information relating to the Group's non-distributable reserves is provided in note 38.

The Group uses its financial assets as collateral for repo and derivative transactions, secured borrowing from central and other banks, issuances of covered bonds, as well as securitizations. As a result of financial assets' pledge, their transfer within the Group is not permitted. Information relating to the Group's pledged financial assets is provided in notes 17, 29 and 40.

The Group is required to maintain balances with central banks and also posts cash collaterals for obtaining funding from Eurosystem. Information relating to mandatory and collateral deposits with central banks is provided in note 15.

24. Investments in associates and joint ventures

As at 31 December 2020, the carrying amount of the Group's investments in associates and joint ventures amounted to € 276 million (2019: € 235 million). The following is the listing of the Group's associates and joint ventures as at 31 December 2020:

Name	Note	Country of incorporation	Line of business	Group's share
Femion Ltd		Cyprus	Special purpose investment vehicle	66.45
(Under liquidation) Tefin S.A.		Greece	Dealership of vehicles and machinery	50.00
Sinda Enterprises Company Ltd		Cyprus	Special purpose investment vehicle	48.00
Singidunum - Buildings d.o.o. Beograd	a	Serbia	Development of building projects	20.01
Alpha Investment Property Kefalariou S.A.		Greece	Real estate	41.67
Global Finance S.A.⁽²⁾		Greece	Investment financing	33.82
Rosequeens Properties Ltd⁽³⁾		Cyprus	Special purpose investment vehicle	33.33
Famar S.A.⁽¹⁾		Luxembourg	Holding company	23.55
Odyssey GP S.a.r.l.		Luxembourg	Special purpose investment vehicle	20.00
Eurolife FFH Insurance Group Holdings S.A.⁽²⁾		Greece	Holding company	20.00
Alpha Investment Property Commercial Stores S.A.		Greece	Real estate	30.00
Peirga Kythnou P.C.		Greece	Real estate	50.00
Value Touristiki S.A.		Greece	Real estate	49.00
Grivalia Hospitality S.A.⁽³⁾		Luxembourg	Real estate	25.00
Information Systems Impact S.A.		Greece	Information systems services	15.00
doValue Greece Loans and Credits Claim Management S.A.	b	Greece	Loans and Credits Claim Management	20.00
Perigenis Business Properties S.A.	d	Greece	Real estate	18.90

(1) Entity under liquidation at 31 December 2020.

(2) Eurolife Insurance group (Eurolife ERB Insurance Group Holdings S.A., which as of 18 May 2020 was renamed to Eurolife FFH Insurance Group Holdings S.A, and its subsidiaries) and Global Finance group (Global Finance S.A. and its subsidiaries) are considered as Group's associates.

(3) Rosequeens Properties Ltd (including its subsidiary Rosequeens Properties SRL) and Grivalia Hospitality group (Grivalia Hospitality S.A. and its subsidiaries) are considered as Group's joint ventures.

Omega Insurance and Reinsurance Brokers S.A. in which the Group holds 26.05% is not accounted under the equity method in the consolidated financialstatements. The Group is notrepresented in the Board of Directors of the company, therefore does not exercise significant influence over it.

Femion Ltd. is accounted for as a joint venture of the Group based on the substance and the purpose of the arrangement and the terms of the shareholder's agreement which require the unanimous consent of the shareholdersforsignificant decisions and establish shared control through the equal representation of the shareholders in the management bodies of the company.

Information Systems Impact S.A. is accounted as an associate of the Group based on the terms of the shareholders' agreement.

For the year ended 31 December 2020, the Group's share of results of Eurolife Insurance group amounting to € 22 million (2019: € 20 million) includes € 30 million, after tax, gains on sale of investment securities (2019: € 13 million).

(a) Singidunum - Buildings d.o.o. Beograd, Serbia

In the year ended 31 December 2020, the Group's participation in Singidunum decreased from 22.47% to 20.01%, following share capital increases in favor of the other shareholder.

(b) doValue Greece Loans and Credits Claim Management S.A., Greece

On 5 June 2020, Eurobank Holdings announced the completion of the sale of 80% of Eurobank FPS Loans and Credits Claim Management S.A. (note 30). Hence, as of June 2020 the company is considered as a Group's associate and accordingly is accounted under the equity method in the consolidated financial statements. Also, in June 2020, the company was renamed to "doValue Greece Loans and Credits Claim Management S.A." ("doValue Greece").

In addition, on 22 October 2020, the Board of Directors of doValue Greece approved the merger with "doValue Greece Holding Single Member S.A." ("doValue Greece Holding"). Before the merger, doValue Greece Holding, which was fully owned by doValue S.p.A., held 80% of doValue Greece's share capital.

The companies agreed to merge by way of absorption of doValue Greece Holding by doValue Greece, in accordance with the provisions of Law 4601/2019, Law 4548/2018 and article 54 of Law 4172/2013.

The merger was completed in December 2020, after receiving the necessary regulatory approvals.

Upon completion of the merger all existing shares of the merging companies were cancelled and new ordinary shares were issued by the absorbing entity, doValue Greece, to its shareholders, doValue S.p.A. and Eurobank S.A, at a 68.5%/ 31.5% shareholding ratio. Contemporaneously with the merger and pursuant to the contractual arrangements between Eurobank and doValue S.p.A., Eurobank sold to doValue S.p.A. a shareholding of 11.5% in doValue Greece for a consideration of € 22.7 million, so that the Group's shareholding in the merged entity was restored to 20%. The consideration received was recognised against the carrying amount of the Group's investment in doValue Greece, to reflect the Group's share in the combined net assets of the company.

(c) Piraeus Port Plaza 2, Greece

As of July 2020, Piraeus Port Plaza 2 ceased to be a Group's joint venture and became a wholly owned subsidiary of the Bank (note 23).

(d) Perigenis Business Properties S.A., Greece

In the third quarter of 2020, in the context of the debt restructuring of a Bank's corporate customer, Perigenis Business Properties S.A., a special purpose real estate company was established, in which the Βank holds a participation of 18.90%. Based on the Bank's representation in the Board of Directors and the decision-making process as prescribed in the company's articles of association, the Bank is considered to have significant influence over the company. Therefore, the company is accounted for as an associate of the Group.

(e) Piraeus Port Plaza 3, Greece

As of October 2020, Piraeus Port Plaza 3 ceased to be a Group's joint venture and became a wholly owned subsidiary of the Bank (note 23).

Post balance sheet event

Singidunum - Buildings d.o.o. Beograd, Serbia

In March 2021, the Group's entity ΙΜΟ Property Investments A.D. Beograd signed a share transfer agreement with the other shareholder of Singidunum - Buildings d.o.o Beograd for the disposal of its participation (20.01%) in the company.

Associates and joint ventures material to the Group

With regards to the Group's associates and joint ventures, Eurolife FFH Insurance Group Holdings S.A., doValue Greece Loans and Credits Claim Management S.A. and Grivalia Hospitality S.A. are considered individually material for the Group. Financial information regarding those entities is provided in the tables below:

Eurolife FFH Insurance Group Holdings S.A.

	2020	2019
	€ million	€ million
Current assets	3,383	3,194
Non-current assets	127	127
Total assets	3,510	3,321
Current liabilities	439	393
Non-current liabilities	2,331	2,209
Total liabilities	2,770	2,602
Operating income	193	176
Net profit	112	101
Other comprehensive income	(91)	234
Total comprehensive income	21	335
Dividends paid to the Group	-	11

doValue Greece Loans and Credits Claim Management S.A.

	2020
	€ million
Current assets	106
Non-current assets	309
Total assets	415
Current liabilities	114
Non-current liabilities	153
Total liabilities	267
Equity	148
Group's share in equity	30
Goodwill ⁽¹⁾	12
Group's carrying amount of the investment	42
Operating income	90
Net profit	12
Other comprehensive income	-
Total comprehensive income	12

(1) it refers to the positive difference between the carrying amount of the Group's investment in doValue Greece (based on the sale agreement with doValue S.p.A., note 44) and the Group's share in the entity's net assets as they both have been adjusted with the absorption of doValue Greece Holding by the entity (see above)

Grivalia Hospitality S.A.

	2020	2019
	€ million	€ million
Current assets⁽¹⁾	40	43
Non-current assets	326	286
Total assets	366	329
Current liabilities⁽²⁾	57	28
Non-current liabilities⁽³⁾	87	67
Total liabilities	144	95
	2020	2019⁽⁴⁾
	€ million	€ million
Operating income/(loss)	(26)	2
Net profit/(loss)	(22)	3
Other comprehensive income/(loss)	(3)	-
Total comprehensive income/(loss)	(25)	3

(1) Includes cash and cash equivalents of € 29 million (2019: € 38 million).

(2) Current financial liabilities excluding trade and other payables and provisions amount to € 2 million (2019: € 11 million).

(3) Non-current financial liabilities excluding trade and other payables and provisions amount to € 72 million (2019: € 43 million).

(4) As of acquisition date of Grivalia Properties REIC S.A. (note 23).

Note: The above financial data for Grivalia Hospitality S.A. have been based on the available information by the end of the third quarter of 2020 and 2019.

The carrying amount, in aggregate, of the Group'sjoint ventures excluding Grivalia Hospitality S.A. as at 31 December 2020 amounted to € 15 million (2019: € 25 million). The Group's share of profit and loss and total comprehensive income of the above entities amounted to € 4 million (2019: € 3 million).

The carrying amount, in aggregate, of the Group's associates excluding Eurolife FFH Insurance Group Holdings S.A. and doValue Greece Loans and Credits Claim Management S.A. which is presented above (i.e. Global Finance S.A., Alpha Investment Property Kefalariou S.A., Singidunum - Buildings d.o.o. Beograd, AEP Commercial Stores S.A., Odyssey GP S.a.r.l., Information Systems Impact S.A. and Perigenis Business Properties S.A.) as at 31 December 2020 amounted to € 25 million (2019: € 19 million). The Group's share of profit and loss and total comprehensive income of the above entities was immaterial (2019: immaterial).

The Group has not recognized losses in relation to its interest in its joint ventures, as its share of losses exceeded its interest in them and no incurred obligations exist or any payments were performed on behalf of them. For the year ended 31 December 2020, the unrecognized share of losses for the Group's joint ventures amounted to € 4 million (2019: € 2 million). The cumulative amount of unrecognized share of losses for the joint ventures amounted to € 22 million (2019: € 18 million).

Following the merger with Grivalia in 2019, the Group assumed contractual commitments to subscribe in future share capital increases in the entities over which it obtained joined control (Piraeus Port Plaza 2, Piraeus Port Plaza 3, Value Touristiki S.A) in accordance with the agreed upon investment budgets on a pro-rata basis to its respective holdings. In addition, the Group agreed to eventually acquire the other shareholders' interest in these joint ventures upon the satisfaction of certain conditions, relating to the completion of the underlying investments, at a price to be determined by reference to the adjusted net asset value of each entity. During 2020, Piraeus Port Plaza 2 and Piraeus Port Plaza 3 became wholly owned subsidiaries of the Bank (note 23), therefore as at 31 December 2020 the Group's contractual commitments remain for Value Touristiki S.A.

Apart from the aforementioned commitments, the Group has no other unrecognized commitments in relation to its participation in joint ventures nor any contingent liabilities regarding its participation in associates or joint ventures, which could result to a future outflow of cash or other resources.

The Group's associate Eurolife FFH Insurance Group Holdings S.A is subject to regulatory and statutory restrictions and is required to maintain sufficient capital to satisfy its insurance obligations.

Except as described above, no significant restrictions exist (e.g. resulting from loan agreements, regulatory requirements or other contractual arrangements) on the ability of associates or joint ventures to transfer funds to the Group either as dividends or to repay loans that have been financed by the Group

25. Structured Entities

The Group is involved in various types of structured entities, such as securitization vehicles, mutual funds and private equity funds.

A structured entity is an entity that has been designed so that voting or similar rights are not the dominant factor in deciding who controlsthe entity, such as when any voting rightsrelate to administrative tasks only and the relevant activities are directed by means of contractual arrangements. A structured entity often has restricted activities, a narrow well-defined objective, insufficient equity to permit it to finance its activities without subordinated financial support and financing in the form of multiple contractually linked instruments to investors that create concentrations of credit or other risks.

An interest in a structured entity refers to contractual and non-contractual involvement that exposes the Group to variability of returns from the performance of the structured entity. Examples of interest in structured entities include the holding of debt and equity instruments, contractual arrangements, liquidity support, credit enhancement, residual value.

Structured entities may be established by the Group or by a third party and are consolidated when the substance of the relationship is such that the structured entities are controlled by the Group, as set out in note 2.2.1(i). As a result of the consolidation assessment performed, the Group has involvement with both consolidated and unconsolidated structured entities, as described below.

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Consolidated structured entities

The Group, as part of its funding activity, enters into securitization transactions of various classes of loans (corporate, small and medium enterprise, mortgage, consumer loans, credit card and bond loans), which generally result in the transfer of the above assets to structured entities (securitization vehicles), which, in turn issue debt securities held by investors and the Group's entities. The Group monitors the credit quality of the securitizations' underlying loans, as well as the credit ratings of the debt instruments issued, when applicable, and provides either credit enhancements to the securitization vehicles and/or transfers new loans to the pool of their underlying assets, whenever necessary, in accordance with the terms of the relevant contractual arrangements in force.

A listing of the Group's consolidated structured entities is set out in note 23.

As at 31 December 2020, the face value of debt securities issued by the securitizations sponsored by the Group amounted to € 11,147 million, of which € 10,552 million were held by the Bank (2019: € 5,788 million, of which € 4,844 million were held by the Bank) (note 34).

The Group did not provide any non contractual financial or other support to these structured entities, where applicable, and currently has no intention to do so in the foreseeable future.

Unconsolidated structured entities

The Group enters into transactions with unconsolidated structured entities, which are those not controlled by the Group, in the normal course of business, in order to provide fund management services or take advantage of specific investment opportunities.

Moreover, the Group in the context of its NPEs reduction acceleration plan entered into the securitization of various classes of NPEs through the issue of senior, mezzanine and junior notes (Cairo and Pillar, notes 34 and 44).

Group managed funds

The Group establishes and manages structured entities in order to provide customers, either retail or institutional, with investment opportunities. Accordingly, through its subsidiaries Eurobank Asset Management Mutual Fund Mngt Company S.A. and Eurobank Fund Management Company (Luxembourg) S.A., it is engaged with the management of different types of mutual funds, including fixed income, equities, funds of funds and money market.

Additionally, the Group is entitled to receive management and other fees and may hold investments in such mutual funds for own investment purposes as well as for the benefit of its customers.

The Group is involved in the initial design of the mutual funds and, in its capacity as fund manager, takes investment decisions on the selection of their investments, nevertheless within a predefined, by relevant laws and regulations, decision making framework. Τherefore, the Group has determined that it has no power over these funds.

Furthermore, in its capacity as fund manager, the Group primary acts as an agent in exercising its decision making authority over them. Based on the above, the Group has assessed that it has no control over these mutual funds and as a result does not consolidate them. The Group does not have any contractual obligation to provide financial support to the managed funds and does not guarantee their rate of return.

Non-Group managed funds

The Group purchases and holds units of third party managed fundsincluding mutual funds, private equity and other investment funds.

Securitizations

The Group has interests in unconsolidated securitization vehicles by investing in residential mortgage backed and other asset-backed securities issued by these entities.

The table below sets out the carrying amount of the Group's interests in unconsolidated structured entities, recognized in the consolidated balance sheet as at 31 December 2020, representing its maximum exposure to loss in relation to these interests. Information relating to the total income derived from interests in unconsolidated structured entities, recognized either in profit or loss or other comprehensive income during 2020 is also provided (i.e. fees, interest income, net gains or losses on revaluation and derecognition):

	31 December 2020
	Unconsolidated structured entity type

	Securitizations	Total
	€ million	€ million	€ million	€ million
Group's interest- assets
Loans and advances to customers⁽¹⁾	3,505	-	-	3,505
Investment securities	67	41	28	135
Other Assets	-	1	-	1
Total	3,572	42	28	3,642
Total income from Group interests	31	49	1	81

	31 December 2019
	Unconsolidated structured entity type
	Securitizations	Group managed funds	Non- Group managed funds	Total
	€ million	€ million	€ million	€ million
Group's interest- assets
Loans and advances to customers ⁽¹⁾	1,062	-	-	1,062
Investment securities	82	46	27	155
Other Assets	-	1	-	1
Total	1,144	47	27	1,218
Total income from Group interests	8	54	2	64

(1) Includes the senior and mezzanine notes of the Pillar and Cairo securitizations (note 34).

For the year ended 31 December 2020, total income related to the Group's interests from securitizations mainly includes: (i) € 30.3 million interest income of debt securities retained by the Group measured at amortized cost and (ii) € 0.7 million from gains or losses on revaluation recognized in other comprehensive income. Total income from Group interests in relation to Group managed funds consists of: (i) € 50.8 million income relating to management fees and other commissions for the management of funds and (ii) € 1.9 million gains or losses on revaluation or from sale of the Group's holding in funds recognized in profit or loss. In addition, total income in relation to non-Group managed funds consists mainly of gains or losses on revaluation or from sale of the Group's holding in funds and has been recognized in profit or loss.

As at 31 December 2020, the total assets of funds under the Group's management as well as the notional amount of notes in issue by unconsolidated securitization vehicles amounted to € 2,303 million (2019: € 2,270 million) and € 12,685 million (2019: € 6,039 million), respectively.

26. Property and equipment

	31 December 2020
		Furniture,
	Land, buildings,	equipment,	Computer
	leasehold	motor	hardware,	Right of use
	improvements	vehicles	software	assets (RoU)⁽¹⁾	Total
	€ million	€ million	€ million	€ million	€ million
Balance at 1 January	681	195	454	211	1,541
Arising from acquisitions (note. 23)	22	-	-	-	22
Transfers	(20)	(0)	1	-	(19)
Additions	12	8	24	26	70
Disposals, write-offs and adjustment to RoU ⁽²⁾	(2)	(5)	(1)	37	29
Exchange adjustments	(0)	(0)	(1)	-	(1)
Held for sale (note 30)	(8)	-	-	-	(8)
Balance at 31 December	685	198	477	274	1,634
Accumulated depreciation:
Balance at 1 January	(207)	(154)	(397)	(37)	(795)
Transfers	3	1	1	-	5
Disposals, write-offs and adjustment to RoU ⁽²⁾	1	4	1	4	10
Charge for the year	(15)	(8)	(17)	(39)	(79)
Exchange adjustments	-	-	1	-	1
Held for sale (note 30)	2	-	-	-	2
Balance at 31 December	(216)	(157)	(411)	(72)	(856)
Net book value at 31 December	469	41	66	202	778

(1) The respective lease liabilities are presented in "other liabilities" (note 35).

(2) It refers to termination, modifications and remeasurements of RoU. It includes the remeasurement from revised estimates of the lease term during the year, considering all facts and circumstances that affect the Group's housing needs.

As at 31 December 2020, the RoU assets amounting to € 202 million (31 December 2019: € 174 million) refer to leased office and branch premises, ATM locations, residential properties of € 194 million (31 December 2019: € 168 million) and motor vehicles of € 8 million (31 December 2019: € 6 million).

	31 December 2019
		Furniture,
	Land, buildings,	equipment,	Computer
	leasehold	motor	hardware,	Right of use assets
	improvements	vehicles	software	(RoU)⁽¹⁾	Total
	€ million	€ million	€ million	€ million	€ million
Cost:
Balance at 1 January	463	185	443	-	1,091
Recognition of RoU on initial application of IFRS 16	-	-	-	344	344
Arising from acquisitions/merger (notes 23)⁽²⁾	206	2	1	(122)	87
Transfers	11	1	1	-	13
Additions	20	11	18	28	77
Disposals, write-offs and adjustment to RoU⁽³⁾	(2)	(3)	(5)	(38)	(48)
Exchange adjustments	0	0	(1)	-	(1)
Held for sale (note 30)	(17)	(1)	(3)	(1)	(22)
Balance at 31 December	681	195	454	211	1,541
Accumulated depreciation:
Balance at 1 January	(197)	(150)	(391)	-	(738)
Arising from acquisitions/merger (notes 23)⁽²⁾	(0)	(0)	(0)	4	4
Transfers	(0)	(0)	(0)	-	(0)
Disposals, write-offs and adjustment to RoU⁽³⁾	1	2	5	-	8
Charge for the year	(15)	(7)	(14)	(41)	(77)
Exchange adjustments	(0)	(0)	1	-	1
Held for sale (note 30)	4	1	2	0	7
Balance at 31 December	(207)	(154)	(397)	(37)	(795)
Net book value at 31 December	474	41	57	174	746

(1) Following the adoption of IFRS 16 as of 1 January 2019. The respective lease liabilities are presented in "other liabilities" (note 35).

(2) Following the merger with Grivalia (note 23), € 132 million right of use assets initially recognised upon transition to IFRS 16 were derecognized in the second quarter of 2019, as the related properties became own used assets of the Group.

(3) It refers to termination, modifications and remeasurements of RoU. It includes the remeasurement from revised estimates of the lease term during the year, considering all facts and circumstances that affect the Group's housing needs, including the merger with Grivalia.

Leasehold improvements relate to premises occupied by the Group for its own activities.

27. Investment property

The Group applies the fair value model regarding the measurement of Investment Property according to IAS 40 "Investment property".

The movement of investment property is as follows:

	2020	2019
	€ million	€ million
Balance at 1 January	1,184	331
Recognition of right-of-use asset on initial application of IFRS 16⁽¹⁾	-	14
Additions	161	28
Arising from acquisition⁽²⁾	111	814
Transfers from/to repossessed assets	2	16
Other transfers	18	(13)
Disposals	(20)	(40)
Net gain/(loss) from fair values adjustments	3	61
Held for sale (note 30)	-	(27)
Balance at 31 December	1,459	1,184

(1)Following the adoption of IFRS 16 as of 1 January 2019. The respective lease liabilities are presented in "other liabilities" (note 35). As at 31 December 2020, RoU assets that meet the definition of investment property amount to € 14 million (31 December 2019: € 15 million).

(2) It refers to the acquisition of Piraeus Port Plaza 2,Piraeus Port Plaza 3 and Tenberco Properties Development and Exploitation Single Member S.A. (note 23).

Changes in fair values of investment property are recognized as gains/(losses) in profit or loss and included in the "Other Income/(expense)". All gains/(losses) are unrealized.

Out of the total additions of investment property during the period, the amount of € 120 million relates to the fulfilment of the Group's contractual obligation at the end of 2019 for the purchase of four real-estate properties leased to a large food and consumer goods retailer group.

During the year ended 31 December 2020, an amount of € 83 million (2019: € 55 million) wasrecognized as rental income from investment property in income from non banking services. As at 31 December 2020, there were no significant contractual obligations in relation to investment property.

The main classes of investment property have been determined based on the nature, the characteristics and the risks of the Group's properties. The fair value measurements of the Group's investment property, which are categorized within level 3 of the fair value hierarchy, are presented in the below table.

	2020	2019
	€ million	€ million
Residential	30	34
Commercial	1,381	1,093
Land Plots	25	31
Industrial	23	26
Total	1,459	1,184

The basic methods used for estimating the fair value of the Group's investment property are the income approach (income capitalization/discounted cash flow method), the comparative method and the cost approach, which are also used in combination depending on the class of property being valued.

The discounted cash flow method is used for estimating the fair value of the Group's commercial investment property. Fair value is calculated through the projection of a series of cash flows using explicit assumptionsregarding the benefits and liabilities of ownership (income and operating costs, vacancy rates, income growth), including the residual value anticipated at the end of the projection period. To this projected cash flows series, an appropriate, market-derived discount rate is applied to establish its present value.

Under the income capitalization method, also used for the commercial class of investment property, a property's fair value is estimated based on the normalized net operating income generated by the property, which is divided by the capitalization rate (the investor's rate of return).

The comparative method is used for the residential, commercial and land plot classes of investment property. Fair value is estimated based on data for comparable transactions, by analyzing either real transaction prices of similar properties, or by asking prices after performing the necessary adjustments.

The cost approach is used for estimating the fair value of the residential and the industrial classes of the Group's investment property. This approach refersto the calculation of the fair value based on the cost of reproduction/replacement (estimated construction costs), which is then reduced by an appropriate rate to reflect depreciation.

The Group's investment property valuations are performed taking into consideration the highest and best use of each asset that is physically possible, legally permissible and financially feasible.

The main method used to estimate the fair value of Group's Investment portfolio as at 31 December 2020, is the discounted cash flow method. Significant unobservable inputs used in the fair value measurement of the relevant portfolio are the rental income growth and the discount rate. Increase in rental income growth would result in increase in the carrying amount while an increase in the discount rate would have the opposite result. The discount rate used ranges from 7.5% to 12.3%. As at 31 December 2020, an increase or decrease of 5% in the discount rate used in the DCF analysis, would result in a downward or upward adjustment of the carrying value of the respective investment properties of € 29 million and € 31 million, respectively.

The Covid-19 outbreak and the subsequent lockdowns have significantly affected the economic activity in Greece, as well as Internationally, particularly the sectors of shopping centers, high street retail (excluding hypermarkets) and hospitality. As the Covid-19 pandemic still evolves, its duration and the full scope of its economic impact is still unknown at this time. Moreover, there is no solid market information and sufficient number of comparable transactions to quantify any relevant effects to the real estate market

or determine their nature, while these effects are usually incorporated gradually and with a time lag in the real-estate market valuations.

The Group's investment property portfolio demonstrated significant resilience in 2020 to the pressures from the covid-19 pandemic, mainly due to its composition, as it primarily consists of office and big box/supermarket properties, as well as its particular characteristics in terms of the tenant's quality and the terms of the lease contracts, that were taken into account by the valuators in determining the fair value of the Group's investment properties.

Due to the lower levels of transactional activity in the real estate market, as mentioned above, a high degree of judgment has been applied in determining the estimated cash flows used in the assessment of the fair value of investment properties. The valuations are therefore reported by professional valuators as being subject to 'material valuation uncertainty' in line with International Valuation Standards, with a higher degree of caution attached to them.

The Group will continue to monitor closely the effect of the economic environment on the valuation of its investment properties.

28. Goodwill and other intangible assets

Goodwill

Impairment testing of goodwill

For the purposes of impairment testing, the goodwill recognised upon the acquisition of Grivalia has been allocated to the Investment Property Segment, which was defined as the Cash Generating Unit ("CGU") expected to benefit from that business combination.

The recoverable amount of the Investment Property Segment was determined from value-in-use calculations. For calculating value in use, the Group considered the business plan approved by the Board of Directors in December 2020, taking into account future prospects of the real estate market, as well as operational and market specific assumptions.

During the year ended 31 December 2020, the Group recognized an impairment loss of € 160 million against the goodwill allocated to the investment property segment.

As a result, the goodwill asset was reduced to nil and the carrying amount of the Investment Property Segment was reduced to its recoverable amount, being € 1,123 million (excluding relevant properties classified as held for sale), reflecting the fair value of the underlying assets. The pre-tax discount rate used in the estimate of value-in-use was 14.9% (2019: 10.3%). The impairment loss was recognised under 'Impairment losses on goodwill' in the Consolidated Income Statement, since the prolonged uncertainty related to the Covid-19 pandemic affected the risk parameters applied for the determination of the segment's recoverable amount. As such, the parameters of the impairment model have been updated in line with the deteriorating macroeconomic factors and increased volatility in the global markets. Furthermore, due to the disruption in the economic activity, timing differences have also arisen with respect to the realization of forthcoming investment projects.

Although the goodwill impairment assessment parameters have been negatively impacted by the uncertainty arising from the pandemic, the valuation results of the underlying investment property portfolio are only marginally negative, while new acquisitions exhibit mark ups. In particular, the Group's investment property portfolio demonstrates significant resilience to the pressures from the Covid-19 pandemic, mainly due to its composition and its particular characteristics, reflecting in parallel its high quality of tenants and strong leases.

During the year ended 31 December 2019, the Group had recognized an impairment loss of € 62 million against the goodwill allocated to the Investment Property Segment.

As at 31 December 2020, the Group's remaining carrying amount of goodwill amounts to € 1.3 million, out of which € 0.9 million relates to ERB Lux Immo S.A.

Other intangible assets

The movement of other intangible assets which refer to purchased and developed software is as follows:

	2020	2019
	€ million	€ million
Cost:
Balance at 1 January	484	424
Transfers	1	0
Additions	76	68
Disposals and write-offs	(21)	(2)
Impairment	(1)	(2)
Held for sale (note 30)	-	(4)
Balance at 31 December	539	484

Accumulated amortisation:
Balance at 1 January	(266)	(241)
Transfers	(2)	-
Amortisation charge for the year	(33)	(31)
Disposals and write-offs	14	3
Held for sale (note 30)	-	3
Balance at 31 December	(287)	(266)

Net book value at 31 December	252	218

29. Other assets
	2020	2019

	€ million	€ million
Receivable from Deposit Guarantee and Investment Fund	708	707
Repossessed properties and relative prepayments	616	614
Pledged amount for a Greek sovereign risk financial guarantee	237	238
Balances under settlement⁽²⁾	11	44
Prepaid expenses and accrued income	104	93
Other guarantees	111	85
Income tax receivable⁽¹⁾	24	42
Other assets	184	180
Total	1,995	2,003

(1) Includes withholding taxes, net of provisions.

(2) Includes settlement balances with customers, balances under settlement relating to the auction process and brokerage activity.

As at 31 December 2020, other assets net of provisions, amounting to € 184 million include, among others, receivables related to (a) prepayments to suppliers, (b) public entities, (c) property management activities and (d) legal cases.

30. Disposal groups classified as held for sale and discontinued operations

(a) Disposal groups classified as held for sale

	2020	2019
	€ million	€ million
Assets of disposal groups
Real estate properties	39	63
Eurobank FPS Loans and Credits Claim Management S.A.	-	10
Non-performing loan portfolios	-	2
Total	39	75
Liabilities of disposal groups
Eurobank FPS Loans and Credits Claim Management S.A.	-	8
Total	-	8

Eurobank FPS Loans and Credits Claim Management S.A., Greece

On 19 December 2019, the Group announced that it has reached an agreement with doValue S.p.A. ("doValue") to dispose 80% of its subsidiary Eurobank FPS Loans and Credits Claim Management S.A. ("FPS"), for a cash consideration of € 248 million, subject to certain adjustments.

As per the agreement, FPS, which was part of Eurobank Ergasias Troubled Asset Group ("TAG") - the unit responsible for the management of the troubled assets portfolio, would take over Eurobank Ergasias TAG unit in order for the sale to be completed. The relevant arrangements were completed at the end of March 2020.

After receiving all regulatory approvals, the above sale transaction was completed on 5 June 2020.

Upon the completion of the transaction, the Group derecognized the assets and liabilities of FPS and recognized its retained 20% interest as an associate, to be accounted for using the equity method of accounting, at its fair value of € 62 million. The fair value was determined by reference to the implied enterprise value of € 310 million for 100% of the entity.

The terms of the transaction remained as per the binding agreement of 19 December 2019, which provided for certain adjustments related with the net cash position of the company, assets under management as of December 2019 and the net economic benefit accrued since 1 January 2020.

The cash consideration received, after the above consideration adjustments, amounted to € 211 million and the resulting gain on disposal was € 219 million before tax (€ 173 million after tax), including the costs directly attributable to the transaction and the remeasurement of the retained interest in FPS.

The transaction was capital accretive, as the effect on Total Capital ratio amounted to approximately + 75 bps excluding transaction expenses and tax.

In the context of the strategic partnership with doValue S.p.A for the management of its Non Performing Exposures ("NPEs"), the Group entered into a 14-year Service Level Agreement ("SLA") with FPS (renamed as doValue Greece Loans and Credits claim Management S.A., "doValue Greece") for the servicing of Eurobank's NPEs and retail early arrears, as well as any future production of them.

Real estate properties

In November 2019, the Group, in the context of its strategy for the active management of its real estate portfolio (repossessed, investment properties and own used properties) reached pre-sale agreements with prospective investors for the disposal of three pools of real estate assets amounting to a total value of ca. € 0.1 billion. Consequently, the disposal of these properties' portfolios was considered highly probable and they have been classified as held for sale (HFS) as of the end of November 2019. The fair value less cost to sell of these properties, based on the offer prices included in the pre-sale agreements, was lower than their carrying amount, therefore an impairment loss of € 24 million was recognized in the fourth quarter of 2019 upon their remeasurement in accordance with the IFRS 5 requirements. After the completion of certain sales during 2020, the carrying amount of these real estate assets as at 31 December 2020 was reduced to € 39 million.

The closing date of the pre-sale agreement regarding one of the relevant portfolios of carrying value € 6.1 million as at 31 December 2020, lapsed on 30 April 2020 without being further extended. However, the Group remains committed to its plan to sell the aforementioned portfolio, which continues to be actively marketed for sale, while a number sales of individual items within the portfolio have already taken place. As such, the portfolio remains classified as HFS as at 31 December 2020.

The sale of the real estate properties classified as HFS, which was initially expected to be concluded within 2020, is now extended beyond this period due to the current extraordinary conditions related to Covid-19 pandemic.

The above non-recurring fair value measurement in year 2019 was categorized as Level 3 of the fair value hierarchy due to the significance of the unobservable inputs used with no change occurring in year 2020.

Non-performing loan portfolios

In the first quarter of 2020, Eurobank Bulgaria A.D. entered into an agreement for the disposal of non-performing corporate and retail loans. Accordingly, loans with gross carrying amount of € 19.2 million, which carried an impairment allowance of € 10.6 million, were classified as held for sale. The transaction was completed in April 2020 with no effect in the Group's income statement.

In the fourth quarter of 2019, Eurobank Ergasias S.A. entered into an agreement for the disposal of non-performing corporate loans and accordingly, loans with gross carrying amount of € 7.6 million, which carried an impairment allowance of € 5.3 million, were classified as held for sale. The transaction was completed in March 2020 with no effect in the Group's income statement.

(b) Discontinued operations

Romanian disposal group

In April 2018, the sale of the Romanian disposal group (Bancpost S.A., ERB Retail Services IFN S.A. and ERB Leasing IFN S.A.), which was the major part of the Group's operations in Romania was completed. According to the terms of the Sale Purchase Agreement (SPA), executed between the Group and Banca Transilvania (the Purchaser), there are certain indemnity clauses based on which the Purchaser could claim specific amounts, subject to certain limitations on total claims, including those for:

a) open (non-expired) taxable periods of Bancpost S.A. until the completion of the transaction. In particular, according to the tax audit assessment communicated to Bancpost S.A. within July 2018, following the completion of the tax audit for the years 2011-2015, the additional taxes to be paid amounted in total to € 40 million, approximately. In respect of the above, the Group has recognized a provision of € 20 million, of which an amount of € 5 million (€ 3.6 million after tax) has been recognized in the year ended 31 December 2019. The Group is in close cooperation with the Purchaser, in respect of challenging the tax audit assessment in the competent courts, which is in progress .In particular, following the recent issuance of an unfavorable decision by the 1 st Instance Court, the case is being further pursued at the Romanian Supreme Court, and

b) losses incurred from claims made against the Purchaser or Bancpost S.A. in relation to a certain loan portfolio. The relevant fines and other measuresimposed on Bancpost SA in 2018 by the Romanian National Authority for Consumer Protection (ANPC) have been cancelled by definitive court rulings issued up to the current year.

31. Due to central banks

	2020	2019
	€ million	€ million
Secured borrowing from ECB	7,999	1,900

The European Central Bank (ECB) has introduced a series of measures since March 2020 in order to further support the liquidity conditions of the banking system, the money market activity and the lending to the real economy in the face of the effects of the Covid-19 pandemic. In particular, a series of longer-term refinancing operations (LTROs) entered into force until 24 June 2020, while the terms and conditions of targeted longer-term refinancing operations (TLTRO III) have been modified within 2020 in terms of lending performance thresholds, applicable interest rates and borrowing allowance in order to support the continuous access of households and firms to bank credit in the face of Covid-19 pandemic's outbreak.

Based on the modified terms of TLTRO III facilities up to December 2020, the interest rate on TLTRO III facilities has been reduced to -0.50% for the period from June 2020 to June 2021, while for the banks subject to meeting the required lending thresholds, the interest rate for the abovementioned period may be capped at -1% (i.e. the minimum of the average deposit facility rate minus 0.5%

and the rate of -1%). Additionally, based on the ECB's decision in January 2021, the reduction of interest rate to -0.5% is extended to the period from June 2021 to June 2022 (also capped at -1%), provided that the lending thresholds for the additional observation period as set in the above mentioned ECB's decision are met.

In the context of the aforementioned measures, the Group increased the borrowing from ECB's longer-term refinancing operations by € 6.12 billion from 31 December 2019, reaching € 8.02 billion at the end of December 2020, using as collaterals, among others, Greek government bonds which became eligible for such financing following ECB's relevant decision in April 2020.

The Group has assessed the terms of the program and concluded that TLTRO III contains a significant benefit in comparison to the market's pricing for other similarly collateralized borrowings available to the Group and this benefit should be accounted for as a government grant under IAS 20. Consequently, the Group considers that the grant is intended to compensate for its funding costs incurred over the term of each TLTRO-III facility and therefore, the benefit should be allocated systematically under interest expense.

As at 31 December 2020, the Group has recognized on an accrual basis, the benefit of '-0.50%' from TLTRO III for the period June 2020 to June 2021 amounting to € 21.2 million. The Group will revisit its expectations of meeting the conditions attached to the more favorable interest rates applicable to TLTRO III facilities and once it has reasonable assurance of meeting the lending targets required it will recognize the benefit into the income statement.

32. Due to credit institutions

	2020	2019
	€ million	€ million
Secured borrowing from credit institutions	683	4,267
Borrowings from international financial and similar institutions	695	632
Current accounts and settlement balances with banks	87	77
Interbank takings	37	46
Total	1,502	5,022

As at 31 December 2020, secured borrowing from credit institutions refers mainly to transactions with foreign institutions, which were conducted with collaterals government – mainly Greek - corporate and bank securities (note 5.2.1.3). As at 31 December 2020, borrowings from international financial and similar institutions include borrowings from European Investment Bank, European Bank for Reconstruction and Development and other similar institutions.

33. Due to customers

	2020	2019
	€ million	€ million
Savings and current accounts	31,663	26,200
Term deposits	15,417	18,430
Repurchase agreements	200	200
Other term products (note 34)	10	11
Total	47,290	44,841

Other term products relate to senior medium-term notes held by the Bank's customers.

For the year ended 31 December 2020, due to customers for the Greek and International operations amounted to € 34,190 million and € 13,100 million, respectively (2019: € 32,444 million and € 12,397 million, respectively).

34. Debt securities in issue

	2020 € million	2019 € million
Securitisations	594	943
Subordinated notes (Tier 2)	947	947
Covered bonds	-	500
Medium-term notes (EMTN) (note 33)	15	16
Total	1,556	2,406

Securitisations

Following their partial redemption in the year ended 31 December 2020, the carrying value of the asset backed securities issued by the Bank's special purpose financing vehicles Maximus Hellas DAC and Astarti DAC and held by an international institutional investor (Class A notes), as at 31 December 2020 amounted to € 146 million and € 145 million, respectively (31 December 2019: € 614 million and € 329 million, respectively).

On 13 July 2020 the Bank, through its special purpose financing vehicle ERB Recovery Designated Activity Company, issued asset backed securities of total face value of € 9.6 billion, collateralized by a portfolio of mortgage, consumer, SME (small and medium enterprise) and corporate loans, which consisted of two classes of notes: (a) a senior class of notes of face value of € 1 billion and (b) junior class of variable funding notes of face value of € 8.6 billion. The aforementioned notes were fully retained by the Bank.

In September 2020, the Bank, through its special purpose financing vehicle Karta II plc and following a cancellation of asset backed securities of carrying value of € 400 million issued by the said financing vehicle and held by the Bank, issued asset backed securities of total face value of € 369.6 million, collateralized by a portfolio of credit card loans, which consisted of: (a) a senior class of notes (the "Class A notes") of face value of € 303 million at a cost of three month Euribor plus 230 basis points which was sold via a private placement to a multi-seller asset-backed commercial paper (ABCP) conduit administered by an international institutional investor and (b) a subordinated class of notes (the "Class B notes") of face value of € 66.6 million, which were retained by the Bank. The transaction has been accounted as a collateralized borrowing, considering that the Bank retains all significant risks and rewards of the securitized assets. As at 31 December 2020, the carrying value of Class A notes amounted to € 303 million.

Pillar securitization

In June 2019, the Group through its special purpose financing vehicle (SPV) 'Pillar Finance Designated Activity Company', issued asset backed securities (notes) of total value of ca. € 2 billion collateralized by a portfolio of primarily non performing residential mortgage loans (project Pillar), which were fully retained by the Group. The securitization consisted of € 1,044 million senior notes issued at par, € 310 million mezzanine notes issued at par and € 645 million junior notes of issue price € 1. In the same month, the Group announced that it has entered into a binding agreement with Celidoria S.A R.L, an entity ultimately owned by funds whose investment manager is the global investment management firm Pimco, for the sale of 95% of the mezzanine and junior notes of the abovementioned securitization. Upon the completion of the transaction, in September 2019 the Bank ceased to have control over the SPV.

As at 31 December 2020, the Group retained 100% of senior, 5% of mezzanine and junior notes (note 20).

Cairo securitisation

In June 2019, the Group, through its special purpose financing vehicles (SPVs) 'Cairo No. 1 Finance Designated Activity Company', 'Cairo No. 2 Finance Designated Activity Company' and 'Cairo No. 3 Finance Designated Activity Company', issued asset backed securities (notes) of total value of ca. € 7.5 billion, collateralized by a mixed assets portfolio of primarily non performing loans, which have been fully retained by the Group The securitization notes consisted of € 2,409 million senior issued at par, € 1,464 million mezzanine issued at par and € 3,633 million junior of issue price € 1.

In the context of Law 4649/2019 ('Hercules' – Hellenic Asset Protection Scheme) voted by the Greek parliament on 16 December 2019, the SPVs opted in for the state guarantee scheme. Specifically, the applications submitted by the Group to the Ministry of Finance were approved on 23 July 2020 while the Guarantee deed was signed on 25 February 2021.

In December 2019, the Group announced that it has entered into binding agreement with doValue S.p.A. for the sale of 20% of the mezzanine and 50.1% of the junior notes of the aforementioned Cairo securitization for a cash consideration of ca. € 14 million. Upon the completion of the transaction, in June 2020, the Group ceased to have control over the SPVs.

In June 2020, Eurobank Holdings, following the respective decision of the Board of Directors, proceeded to the contribution of the retained Cairo notes, i.e. 75% of the mezzanine and 44.9% of the junior notes, of total fair value of ca. € 56 million to the Cyprusbased subsidiary 'Mairanus Ltd', renamed to Cairo Mezz Plc, in exchange for its newly-issued shares.

In September 2020, upon the relevant approval of Eurobank Holding's General Shareholders' Meeting, the distribution of Cairo Mezz Plc shares to Eurobank Holding's shareholders was completed. As a result, the Group ceased to have control over Cairo Mezz Plc.

As at 31 December 2020, the Group retained 100% of senior, 5% of mezzanine and junior notes (note 20).

A description of the accounting implications of the aforementioned transactions and events is provided in note 44.

Tier 2 Capital instruments

In January 2018, Eurobank Ergasias S.A. issued Tier 2 capital instruments of face value of € 950 million, in replacement of the preference shares which had been issued in the context of the first stream of Hellenic Republic's plan to support liquidity in the Greek economy under Law 3723/2008. The aforementioned instruments, which have a maturity of ten years (until 17 January 2028) and pay fixed nominal interest rate of 6.41%, that shall be payable semi-annually, as at 31 December 2020, amounted to € 947 million, including € 3 million unamortized issuance costs.

Covered bonds

In February 2020, the Bank proceeded with the partial cancellation of covered bonds of face value of € 150 million, previously retained by the entity, while on 2 November 2020 covered bonds of face value of € 500 million issued by the Bank and held by third party investors, matured.

Financial disclosures required by the Act 2620/28.08.2009 of the Bank of Greece in relation to the covered bondsissued, are available at the Bank's website (Investor Report for Covered Bonds Programs).

Post balance sheet events

On 4 February 2021 the Bank proceeded with a new covered bonds' issue of face value of € 600 million, fully retained by the Bank.

On 22 February 2021 the Bank proceeded with the early termination of the Maximus Hellas DAC securitization.

On 22 March 2021 the Bank proceeded with the restructuring of ASTARTI securitization upsizing the Class A notes held by an international institutional investor to € 250 million while the Class B notes, retained by the Bank, were decreased from € 219 million to € 98 million.

35. Other liabilities

	2020	2019
	€ million	€ million
Lease liabilities	221	193
Balances under settlement⁽¹⁾	267	326
Deferred income and accrued expenses	134	109
Other provisions	93	98
ECL allowance for credit related commitments (note 5.2.1.2)	66	64
Standard legal staff retirement indemnity obligations (note 36)	46	52
Employee termination benefits	97	32
Sovereign risk financial guarantee	38	41
Acquisition obligation	15	22
Income taxes payable	10	7
Deferred tax liabilities (note 13)	21	9
Other liabilities	189	238
Total	1,197	1,191

(1)Includes settlement balances relating to bank cheques and remittances, credit card transactions, other banking and brokerage activities.

EUROBANK ERGASIAS SERVICES and HOLDINGS S.A.

As at 31 December 2020, other liabilities amounting to € 189 million mainly consist of payables relating with (a) suppliers and creditors, (b) contributions to insurance organizations, (c) duties and other taxes and (d) trading liabilities.

As at 31 December 2020, other provisions amounting to € 93 million (2019: € 98 million) mainly include: (a) € 60 million for outstanding litigations against the Group (note 42), (b) € 28 million for other operational risk events, of which € 22 million is related to Romanian disposal group (note 30) and (c) € 1 million for restructuring costs mainly relating to the acquisition of Piraeus Bank Bulgaria A.D.

The movement of the Group's other provisions, is presented in the following table:

	31 December 2020
	Litigations and claims in
	dispute € million	Other € million	Total € million
Balance at 1 January	59	39	98
Amounts charged during the year	10	4	14
Amounts used during the year	(4)	(8)	(12)
Amounts reversed during the year	(4)	(3)	(7)
Foreign exchange and other movements	(1)	1	(0)
Balance at 31 December	60	33	93

		31 December 2019
	Litigations and
	claims in
	dispute	Other	Total
	€ million	€ million	€ million
Balance at 1 January	56	42	98
Amounts charged during the year	6	24	30
Amounts used during the year	(1)	(21)	(22)
Amounts reversed during the year	(2)	(4)	(6)
Foreign exchange and other movements	0	(1)	(1)
Liabilities of disposal group (note 30)	-	(1)	(1)
Balance at 31 December	59	39	98

For the year ended 31 December 2020, an amount of € 127.4 million has been recognised in the Group's income statement for employee termination benefits in respect of the Voluntary Exit Schemes (VES), which is further analysed asfollows: (a) € 118.9 million cost for the new VES, that was launched by the Group in September 2020 for eligible units in Greece and offered to employees over a specific age limit. The new VES is implemented through either lump-sum payments or long term leaves during which the employees will be receiving a percentage of a monthly salary, or a combination thereof, while the estimated saving in personnel expenses amounts to € 35.6 million on an annual basis, and (b) € 8.5 million relating to the additional cost for the VES that was launched by the Bank in 2019, which has been offered to employees over an age limit as well as to employees of specific eligible Bank units independent of age and is implemented through the aforementioned ways.

36. Standard legal staff retirement indemnity obligations

The Group provides for staff retirement indemnity obligation for its employees in Greece and abroad, who are entitled to a lump sum payment based on the number of years of service and the level of remuneration at the date of retirement, if they remain in the employment of the Group until normal retirement age, in accordance with the local labor legislation. The above retirement indemnity obligations typically expose the Group to actuarial risks such as interest rate risk and salary risk. Therefore, a decrease in the discount rate used to calculate the present value of the estimated future cash outflows or an increase in future salaries will increase the staff retirement indemnity obligations of the Group.

The movement of the liability for standard legal staff retirement indemnity obligations is as follows:

	2020	2019
	€ million	€ million
Balance at 1 January	52	49
Arising from acquisition (note 23)	-	1
Current service cost	3	3
Interest cost	1	1
Past service cost and (gains)/losses on settlements	55	30
Remeasurements:
Actuarial (gains)/losses arising from changes in financial assumptions	2	4
Actuarial (gains)/losses arising from changes in demographic assumptions	(0)	-
Actuarial (gains)/losses arising from experience adjustments	0	1
Benefits paid	(67)	(36)
Exchange adjustments	0	0
Liabilities of disposal group (note 30)	-	(1)
Balance at 31 December	46	52

The benefits paid by the Group during 2020, in the context of the Voluntary Exit Scheme (VES) (note 35), amounted to € 67 million. The provision for staff retirement obligations of the staff that participated in the above scheme, amounted to € 10 million.

The significant actuarial assumptions (expressed as weighted averages) were as follows:

	2020	2019
	%	%
Discount rate	0.6	0.9
Future salary increases	2.2	2.0

As at 31 December 2020, the average duration of the standard legal staff retirement indemnity obligation was 16 years (2019: 17 years).

A quantitative sensitivity analysis based on reasonable changes to significant actuarial assumptions as at 31 December 2020 is as follows:

An increase/(decrease) of the discount rate assumed, by 50 bps/(50 bps), would result in a (decrease)/increase of the standard legal staff retirement obligations by (€ 3.7 million)/ € 4.0 million.

An increase/(decrease) of the future salary growth assumed, by 0.5%/(0.5%) would result in an increase/(decrease) of the standard legal staff retirement obligations by € 3.9 million/(€ 3.6 million).

The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated.

The methods and assumptions used in preparing the above sensitivity analysis were consistent with those used to estimate the retirement benefit obligation and did not change compared to the previous year.

37. Share capital, share premium and treasury shares

As at 31 December 2020, the par value of the Company's shares is € 0.22 per share (2019: € 0.23). All shares are fully paid. The movement of share capital, share premium and treasury shares is as follows:

	Share capital € million	Treasury shares € million	Net € million	Share premium € million	Treasury shares € million	Net € million
Balance at 1 January 2019	656	(1)	655	8,056	(1)	8,055
Share capital increase, following the merger with Grivalia Properties REIC	197	-	197	-	-	-
Purchase of treasury shares	-	(1)	(1)	-	(3)	(3)
Sale of treasury shares	-	1	1	-	2	2
Balance at 31 December 2019	853	(1)	852	8,056	(2)	8,054
Balance at 1 January 2020	853	(1)	852	8,056	(2)	8,054
Share capital decrease	(57)	-	(57)	-	-	-
Capitalization of taxed reserves	21	-	21	-	-	-
Purchase of treasury shares	-	(1)	(1)	-	(1)	(1)
Sale of treasury shares	-	1	1	-	2	2
Balance at 31 December 2020	816	(1)	815	8,056	(1)	8,055

The following is an analysis of the movement in the number of shares issued by the Company:

	Number of shares
	Issued Shares	Treasury Shares	Net
Balance at 1 January 2019 Share capital increase, following the merger with	2,185,998,765	(1,194,032)	2,184,804,733
Grivalia Properties REIC	1,523,163,087	-	1,523,163,087
Purchase of treasury shares	-	(5,612,661)	(5,612,661)
Sale of treasury shares	-	3,991,381	3,991,381
Balance at 31 December 2019	3,709,161,852	(2,815,312)	3,706,346,540
Balance at 1 January 2020 Purchase of treasury shares Sale of treasury shares	3,709,161,852 - -	(2,815,312) (2,999,758) 3,381,083	3,706,346,540 (2,999,758) 3,381,083
Balance at 31 December 2020	3,709,161,852	(2,433,987)	3,706,727,865

Decrease of the share capital in kind

On 7 July 2020, the Board of Directors of the Company proposed to the General Shareholders' Meeting the distribution of Mairanus Ltd (renamed to Cairo Mezz Plc) shares to the Company's shareholders through the decrease in kind of its share capital.

Following the above, on 28 July 2020, the Annual General Meeting of the Shareholders of the Company approved among others:

(a) the decrease of the share capital in kind with the decrease in the nominal value of each ordinary share issued by the Company by € 0.0155 and the distribution to its shareholders of shares issued by Cairo Mezz Plc, with a value corresponding to the value of the share capital decrease, i.e. 309,096,821 common shares issued by Cairo Mezz Plc, each common registered share of nominal value € 0.10, at a ratio of 1 share of Cairo Mezz Plc for every 12 shares of the Company already held (note 44), and
(b) the capitalization of taxed reserves amounting to € 20,400,390.19 for the purpose of rounding the new nominal value of each ordinary share issued by the Company.

Following the aforementioned decision, the Company's total share capital amounts to € 816,015,607.44 and the total number of shares remains unchanged, i.e. 3,709,161,852 common voting shares of a nominal value of € 0.22 each.

Share options

In addition, the aforementioned Annual General Meeting of the shareholders of the Company:

(a) approved the establishment of a five year shares award plan, starting from 2021, in the form of stock options rights by issuing new shares with a corresponding share capital increase, awarded to executives (of the Management) and personnel of the Company and its affiliated companies. The maximum number of rightsthat can be approved will be 55,637,000 rights, each of which will correspond to one new share, i.e. in case all option rights are exercised up to 55,637,000 new common registered shares of the Company in total will be allocated, corresponding to 1.5% of the current paid share capital. The exercise price of each new share is equal to the nominal value of the share.
(b) authorized the Board of Directors of Eurobank Holdings to determine the remaining terms and conditions of the plan.

Treasury shares

In the ordinary course of business, the Company's subsidiaries, except for the Bank, may acquire and dispose of treasury shares. According to paragraph 1 of Article 16c of Law 3864/2010, during the period of the participation of the HFSF in the share capital of the Company, the Company is not permitted to purchase treasury shares without the approval of the HFSF.

In addition, as at 31 December 2020 the number of the Company's shares held by the Group's associates in the ordinary course of their insurance and investing activities was 64,763,790 in total (2019: 63,158,565).

38. Reserves and retained earnings

	Statutory	Non-taxed	Fair value	Other	Retained
	reserves	reserves	reserve	reserves	earnings	Total
	€ million	€ million	€ million	€ million	€ million	€ million
Balance at 1 January 2019	384	943	95	6,375	(11,506)	(3,709)
Net profit	-	-	-	-	127	127
Transfers between reserves	2	1	-	-	(3)	-
Merger with Grivalia Properties REIC (note
23)	9	-	-	549	332	890
Debt securities at FVOCI	-	-	415	-	-	415
Cash flow hedges	-	-	-	(5)	-	(5)
Foreign currency translation	-	-	-	2	-	2
Associates and joint ventures						-
-changes in the share of other comprehensive
income, net of tax	-	-	47	-	-	47
Actuarial gains/(losses) on post employment
benefit obligations, net of tax	-	-	-	(4)	-	(4)
Preferred securities' redemption and
dividend paid, net of tax	-	-	-	-	(4)	(4)
Balance at 31 December 2019	395	944	557	6,917	(11,054)	(2,241)

Balance at 1 January 2020	395	944	557	6,917	(11,054)	(2,241)
Net profit	-	-	-	-	(1,213)	(1,213)
Transfers between reserves	1	4	-	-	(5)	-
Capitalization of taxed reserves (note 37)	-	-	-	-	(21)	(21)
Debt securities at FVOCI	-	0	(124)	-	-	(124)
Cash flow hedges	-	-	-	(7)	-	(7)
Foreign currency translation	-	-	-	(0)	-	(0)
Associates and joint ventures
-changes in the share of other comprehensive
income, net of tax	-	-	(18)	(1)	-	(19)
Actuarial gains/(losses) on post employment
benefit obligations, net of tax	-	-	-	(1)	-	(1)
Other	-	-	-	1	(0)	1
Balance at 31 December 2020	396	948	415	6,909	(12,293)	(3,625)

As at 31 December 2020, other reserves mainly comprise: (a) € 5,579 million, referring to the Company, pursuant to the corporate law in force (currently article 31 of Law 4548/2018), which can be only either capitalized or offset against losses carried forward (2019: € 5,579 million), (b) € 1,126 million, referring to the Company, also pursuant to the corporate law in force (currently article 35 of Law 4548/2018), which is not distributable, but it can be either capitalized or offset against losses carried forward to the extent that these losses cannot be covered by designated reserves or other company funds for which loss absorption is provided in the corporate law (2019: € 1,126 million), (c) € 202 million accumulated loss relating to foreign operations' translation differences, including € 27 million accumulated gain relating to net investment hedging - NIH (2019: € 201 million accumulated loss, including € 27 million gain relating to NIH) and (d) € 49 million accumulated loss relating to cash flow hedging (2019: € 42 million loss).

Statutory reserves, fair value reserve and cash flow hedges are not distributable while non-taxed reserves are taxed when distributed.

Dividends

Based on the 2020 accounts, pursuant to the Company Law 4548/2018, the distribution of dividends is not permitted. Furthermore, under the provisions of the Tripartite Relationship Agreement between Eurobank Holdings, the Bank and the HFSF (signed 23.3.2020) and article 10 par. 3 of Law 3864/2010 for the "establishment of a Hellenic Financial Stability Fund", for as long the HFSF participates in the share capital of the Eurobank Holdings, the amount of dividends that may be distributed to shareholders of either Eurobank Holdings or the Bank cannot exceed 35% of the profits as provided in article 161 par. 2 of Company Law 4548/2018.

39. Preferred securities

In April 2019, the Board of Directors of ERB Hellas Funding decided to proceed with the redemption of all four series of the preferred securities issued. Accordingly, following a notice for redemption on 29 May, 21 June and 13 September 2019, series C, B and D preferred securities were redeemed on 9 July, 2 August and 29 October 2019, respectively.

On 23 January 2020, a notice for the redemption of the remaining preferred securities of series A was given to the holders and on 18 March 2020, the aforementioned notes of face value of € 1.6 million were redeemed. In addition, for the year ended 31 December 2020, ERB Hellas Funding Ltd declared and paid for Series A of preferred securities in accordance with its terms and following the redemption of the Greek State – owned preference shares (note 34) on 17 January 2018, the non-cumulative dividend of € 11 thousand.

40. Transfers of financial assets

The Group enters into transactions by which it transfers recognized financial assets directly to third parties or to Special Purpose Entities (SPEs).

(a) The Group sells, in exchange for cash, securities under an agreement to repurchase them (repos) and assumes a liability to repay to the counterparty the cash received. In addition, the Group pledges, in exchange for cash,securities, covered bonds, as well asloans and receivables and assumes a liability to repay to the counterparty the cash received. The Group may also transfer securities under securities lending agreements with no exchange of cash or pledging of other financial assets as collateral. For all the aforementioned transactions, the Group has determined that it retains substantially all the risks, including associated credit and interest rate risks, and rewards of these financial assets and therefore has not derecognized them. As a result, the Group is unable to use, sell or pledge the transferred assets for the duration of the transaction. The related liability, where applicable, is recognized in Due to central banks and credit institutions (notes 31 and 32), Due to customers (note 33) and Debt securities in issue (note 34), as appropriate.

The Group enters into securitizations of various classes of loans (corporate, small and medium enterprise, consumer and various classes of non-performing loans), under which it assumes an obligation to pass on the cash flows from the loans to the holders of the notes. The Group has determined that it retains substantially all risks, including associated credit and interest rate risks, and rewards of these loans and therefore has not derecognized them. As a result of the above transactions, the Group is unable to use, sell or pledge the transferred assets for the duration of their retention by the SPE. Moreover, the note holders' recourse is limited to the transferred loans. As at 31 December 2020, the securitizations' issues held by third parties amounted to € 594 million (2019: € 943 million) (note 34).

The table below sets out the details of Group's financial assets that have been sold or otherwise transferred, but which do not qualify for derecognition:

	Carrying amount
	2020	2019⁽²⁾
	€ million	€ million
Securities held for trading	7	8
Loans and advances to customers	16,015	11,673
-securitized loans⁽¹⁾	6,740	5,557
-pledged loans under covered bond program	3,707	4,578
-pledged loans with central banks	5,357	1,313
-other pledged loans	211	225
Investment securities	6,076	3,667
Total	22,098	15,348

(1) It includes securitized loans of issues held by the Bank, not used for funding (note 34). In addition, in the comparative period are included loans under the Cairo securitizations

(2) Comparative figures include the impairment allowance on Loans and advances to customers.

(b) The Group may sell or re-pledge any securities borrowed or obtained through reverse repos and has an obligation to return the securities. The counterparty retains substantially all the risks and rewards of ownership and therefore the securities are not recognized by the Group. As at 31 December 2020, the Group had obtained through reverse repos securities of face value of € 1,154 million, of which € 1,038 sold under repurchase agreements with cash value of € 1,270 million (2019: € 374 million and € 500 million, respectively). Furthermore, as at 31 December 2020, the Group had obtained Greek treasury bills as collaterals for derivatives transactions with the Hellenic Republic of face value of € 1,285 million, sold under repurchase agreements with € 1,080 million cash value (2019: € 1,870 million and € 1,538 million, respectively).

As at 31 December 2020, the cash value of the assets transferred or borrowed by the Group through securities lending, reverse repo and other agreements (points a and b) amounted to € 12,843 million, while the associated liability from the above transactions amounted to € 10,558 million, of which € 1,065 million repo agreements offset in the balance sheet against reverse repo deals (notes 31, 32, 33, 34 and 5.2.1.4) (2019: cash value € 9,659 million and liability € 9,448 million, of which € 1,607 million repo agreements offset in the balance sheet). In addition, the Group's financial assets pledged as collaterals for repos, derivatives, securitizations and other transactions other than the financial assets presented in the table above are provided in notes 17 and 29.

41. Leases

Group as a lessee

The Group leases office and branch premises, ATM locations, residential properties for the Group's personnel, and motor vehicles.

The majority of the Group's property leases are under long term agreements (for a term of 12 years or more in the case of leased real estate assets), with options to extend or terminate the lease according to the terms of each contract and the usual terms and conditions of commercial leases applicable in each jurisdiction, while motor vehicles generally have lease terms of up to 4 years. Extension options held by the Group are included in the lease term when it is reasonably certain that they will be exercised based on its assessment. For contracts having an indefinite remaining life as at 1 January 2020, the lease term has been determined at an average of 7 yearsfor the Bank, after considering all relevant facts and circumstances. Depending on the terms of each lease contract, lease payments are adjusted annually in line with the consumer Price Index, as published by the Greek Statistical Authority, plus an agreed fixed percentage.

Information about the leases for which the Group is a lessee is presented below:

Right-of-Use Assets

As at 31 December 2020, the right-of-use assets included in property plant and equipment amounted to € 202 million (31 December 2019: € 174 million) (note 26), while those that meet the definition of investment property amounted to € 14 million (31 December 2019: € 15 million) (note 27).

Lease Liabilities

The lease liability included under other liabilities amounted to € 221 million as at 31 December 2020 (31 December 2019: € 193 million) (note 35). The maturity analysis of lease liabilities as at 31 December 2020, based on the contractual undiscounted cash flows, is presented in note 5.2.3.

Amounts recognised in profit or loss

Interest on lease liabilities is presented in note 6 and the lease expense relating to short term leases is ca. € 3 million (31 December 2019: € 4 million).

The Group had total cash outflows for leases of € 44 million in 2020 (2019: € 46 million).

Group as a lessor

Finance lease

The Group leases out certain real estate properties and equipment under finance leases, in its capacity as a lessor.

The maturity analysis of finance lease receivables, based on the undiscounted lease payments to be received after the reporting date, is provided below:

	2020	2019
	€ million	€ million
Not later than one year	18	21
1-2 years	13	15
2-3 years	10	10
3-4 years	7	8
4-5 years	5	6
Later than 5 years	13	19
Lease Payments:	66	79
Unguaranteed residual values	821	892
Gross investment in finance leases	887	971
Less: unearned finance income	(54)	(65)
Net investment in finance leases	833	906
Less: impairment allowance	(306)	(350)
Total	527	556

Operating Leases

The Group leases out its investment property under the usual terms and conditions of commercial leases applicable in each jurisdiction. When such leases do not transfer substantially all of the risks and rewards incidental to the ownership of the leased assets, the Group classifies these lease as operating leases. Information relating to operating leases of investment property, including the rental income recognised by the Group during the year, is provided in note 27.

In the context of the relief measures taken in response to the Covid-19 outbreak, the Group as a lessor has granted certain rent concessions to its tenants directly affected by the Covid-19 pandemic. The total reduction in rent receivable from the above lease modifications up to 31 December 2020 amounts to approximately € 7 million before tax and will be recognised gradually over the remaining lease term of the respective lease contracts. The part of the reduction recognised up to 31 December 2020 in "Income from non banking services" amounts to approximately € 1 million.

Rent concessions granted to the Group as a lessee up to 31 December 2020, as direct consequence of the Covid-19 pandemic, amount to approximately € 1 million and have been recognised in "Other Income/ (expenses)", in accordance with "Covid-19-Related Rent Concessions (Amendment to IFRS 16)" issued in May 2020.

The maturity analysis of operating lease receivables, based on the undiscounted lease payments to be received after the reporting date, is provided below:

	2020	2019
	€ million	€ million
Not later than one year	90	70
One to two years	85	66
Two to three years	79	62
Three to four years	72	50
Four to five years	62	44
More than five years	324	246
Total	712	538

42. Contingent liabilities and other commitments

The Group presents the credit related commitments it has undertaken within the context of its lending related activities into the following three categories: a) financial guarantee contracts, which refer to guarantees and standby letters of credit that carry the same credit risk asloans(creditsubstitutes), b) commitmentsto extend credit, which comprise firm commitmentsthat are irrevocable over the life of the facility or revocable only in response to a material adverse effect and c) other credit related commitments, which refer to documentary and commercial letters and other guarantees of medium and low risk according to the Regulation No 575/2013/EU.

Credit related commitments are analyzed as follows:

	2020	2019
	€ million	€ million
Financial guarantee contracts	641	723
Commitments to extend credit	1,200	1,115
Other credit related commitments ⁽¹⁾	484	507
Total	2,325	2,345

The credit related commitments within the scope of IFRS 9 impairment requirements amount to € 5.7 billion (2019: € 5.3 billion), including revocable loan commitments of € 3.4 billion (2019: € 3 billion), while the corresponding allowance for impairment losses amounts to € 66 million (2019: € 64 million).

In addition, the Group has issued a sovereign risk financial guarantee of € 0.24 billion (31 December 2019: € 0.24 billion) for which an equivalent amount has been deposited under the relevant pledge agreement (note 29).

Other commitments

(a) The Bank has signed irrevocable payment commitment and collateral arrangement agreements with the Single Resolution Board (SRB) amounting in total to € 16 million as at 31 December 2020 (2019: € 13 million), representing 15% of its resolution contribution payment obligation to the Single Resolution Fund (SRF) for the years 2016-2020.

According to the agreements, which are backed by cash collateral of an equal amount, the Bank undertook to pay to the SRB an amount up to the above irrevocable payment commitment, in case of a call and demand for payment made by it, in relation to a resolution action. The said cash collateral has been recognized as a financial asset in the Group's balance sheet (note 29).

(b) As at 31 December 2020, the contractual commitments for the acquisition of own used property, equipment and intangible assets amounted to € 40 million (2019: € 29 million).

Legal proceedings

As at 31 December 2020, a provision of € 60 million has been recorded for a number of legal proceedings outstanding against the Group (31 December 2019: € 59 million). The said amount includes € 34 million for an outstanding litigation related to the acquisition of New TT Hellenic Postbank S.A. in 2013 (31 December 2019: € 34 million).

Furthermore, in the normal course of its business, the Group has been involved in a number of legal proceedings, which are either at still a premature or at an advanced trial instance. The final settlement of these cases may require the lapse of a certain time so that the litigants exhaust the legal remedies provided for by the law. Management, having considered the advice of the Legal Services General Division, does not expect that there will be an outflow of resources and therefore does not acknowledge the need for a provision.

Following the completion of the banking sector's hive down of Eurobank Ergasias S.A. (Demerged entity) the Beneficiary (i.e. Eurobank S.A., "Bank") substitutes the Demerged Entity (currently Eurobank Holdings), by way of universal succession, to all the transferred assets and liabilities (note 44), while pending lawsuits where the Demerged entity was an involved party and are related to the hived down banking sector, will continue ipso jure by the Bank or against it.

Against the Bank various legal remedies and redresses have been filed amongst others in the form of lawsuits, applications for injunction measures, motions to vacate payment orders and appeals in relation to the validity of clauses for the granting of loans in Swiss Francs. To date the vast majority of the judgments issued by the first instance and the appellate Courts have found in favour of the Bank's positions. As to certain aspects of Swiss Francs loans there was a lawsuit before the Supreme Court at plenary session which was initiated from an individual lawsuit. The Decision issued on 18 April 2019 was in favour of the Bank.

On the class action that has been filed by a consumer union, a judgment of the Athens Court of Appeals was issued in February 2018, which was in favour of the Bank and rejected the lawsuit on its merits. The judgment has been challenged by the consumer unions with a petition of cassation which was heard on 13 January 2020 and the decision is pending to be issued.

In any event, the Management of the Bank is closely monitoring the developments to the relevant cases so as to ascertain potential accounting implications in accordance with the Group's accounting policies.

43. Operating segment information

Management has determined the operating segments based on the internal reports reviewed by the Strategic Planning Committee that are used to allocate resources and to assess their performance in order to make strategic decisions. The Strategic Planning Committee considers the business both from a business unit and geographic perspective. Geographically, management considers the performance of its business activities originated from Greece and other countries in Europe (International).

As of the first quarter of 2020, Greece is further segregated into retail, corporate, global, capital markets & asset management and investment property. Wealth management operations, previously reported as a separate segment, have been allocated to global, capital markets & asset management and other operations as presented below. International is monitored and reviewed on a country basis. The Group aggregatessegments when they exhibitsimilar economic characteristics and profile and are expected to have similar long-term economic development.

In more detail, the Group is organized in the following reportable segments:

Retail: incorporating customer current accounts, savings, deposits and investment savings products, credit and debit cards, consumer loans, small business banking and mortgages.
Corporate: incorporating current accounts, deposits, overdrafts, loan and other credit facilities, foreign currency and derivative products to corporate entities, custody, cash management and trade services.
Global, Capital Markets & Asset Management: incorporating investment banking servicesincluding corporate finance, merger and acquisitions advice, financial instruments trading and institutional finance to corporate and institutional entities, as well as, specialized financial advice and intermediation to private and large retail individuals and to small and large corporate entities. In addition, as of the first quarter of 2020, this segment incorporates mutual fund and investment savings products and institutional asset management, which were previously incorporated in the Wealth Management segment, and equity brokerage, which was previously incorporated in the Corporate segment.
International: incorporating operations in Bulgaria, Serbia, Cyprus, Luxembourg and Romania.
Investment Property: As of the second quarter of 2019, following the merger of Eurobank Ergasias S.A. with Grivalia, the investment property activities (Bank, Eurobank Ergasias Leasing S.A. and former Grivalia group) relating to a diversified portfolio of commercial assets, with high yield on prime real estate assets, in the office, retail, logistics, infrastructure and hospitality sectors, are monitored as a separate Group segment.

Other segment of the Group refers mainly to a) property management (including repossessed assets), b) other investing activities (including equities' positions), c) as of the first quarter of 2020, private banking services to medium and high net worth individuals

and the Group'sshare of results of Eurolife Insurance group, which were previously incorporated in the Wealth Managementsegment and d) the results related to the corporate transformation plan (note 44), the notes of the Cairo and Pillar securitizations, which were retained by the Group, and the Group's share of results of doValue Greece Loans and Credits Claim Management S.A.

The aforementioned organizational changes affecting the Group's reported segments are effective from 2020 onwards. Comparative information has not been adjusted accordingly.

The Group's management reporting is based on International Financial Reporting Standards (IFRS) as adopted by the EU. The accounting policies of the Group's operating segments are the same with those described in the principal accounting policies.

Revenues from transactions between business segments are allocated on a mutually agreed basis at rates that approximate market prices.

43.1 Operating segments

	31 December 2020
			Global, Capital Markets &	Investment		Other and Elimination
	Retail	Corporate	Asset Mngt	Property	International	center	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Net interest income	464	327	222	(19)	367	(12)	1,349
Net commission income	60	56	84	(0)	99	(1)	298
Other net revenue	(3)	(1)	430	96	9	223	754
Total external revenue	522	382	736	76	474	211	2,401
Inter-segment revenue	16	44	(28)	2	(4)	(29)	-
Total revenue	537	426	708	78	470	181	2,401
Operating expenses	(419)	(131)	(59)	(33)	(232)	5	(869)
Impairment losses relating to loans
and advances to customers	(316)	(160)	-	-	(95)	(1,510)	(2,081)
Impairment losses on goodwill	-	-	-	(160)	-	-	(160)
Other impairment losses and provisions (note 12)	(8)	(3)	(8)	(0)	(6)	(18)	(43)
Share of results of associates and
joint ventures	(0)	1	0	(3)	(2)	25	21
Profit/(loss) before tax from continuing operations
before restructuring costs	(205)	133	642	(118)	135	(1,317)	(731)
Restructuring costs (note 12)	(36)	(4)	(1)	(0)	(1)	(103)	(145)
Profit/(loss) before tax from
continuing operations	(241)	129	641	(118)	134	(1,420)	(876)
Non controlling interests	-	-	-	(0)	(0)	0	0
Profit/(loss) before tax attributable
to shareholders	(241)	129	641	(118)	134	(1,420)	(876)

		31 December 2020
		Global, Capital Other and
			Markets & Asset	Investment		Elimination
	Retail⁽³⁾	Corporate⁽³⁾	Mngt	Property	International	center⁽¹⁾⁽³⁾	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Segment assets	16,745	13,377	12,309	1,444	16,694	7,160	67,728
Segment liabilities	27,305	8,129	6,805	310	14,993	4,941	62,483

The International segment is further analyzed as follows:

	31 December 2020
	Bulgaria € million	Serbia € million	Cyprus € million	Luxembourg € million	Romania € million	Total € million
Net interest income	181	54	102	23	7	367
Net commission income	53	13	27	8	(1)	99
Other net revenue	(2)	3	8	1	(1)	9
Total external revenue	232	69	137	32	5	474
Inter-segment revenue	0	(0)	0	(4)	-	(4)
Total revenue	232	69	137	27	5	470
Operating expenses Impairment losses relating to loans and	(116)	(47)	(43)	(20)	(6)	(232)
advances to customers	(50)	(12)	(15)	(0)	(19)	(95)
Other impairment losses and provisions Share of results of associates and joint	(3)	(1)	(2)	(0)	(1)	(6)
ventures Profit/(loss) before tax from continuing operations before restructuring costs	(0) 63	(2) 6	- 77	- 8	0 (20)	(2) 135
Restructuring costs (note 12) Profit/(loss) before tax from continuing	-	-	-	(1)	-	(1)
operations Loss before tax from discontinued operations	63 -	6 -	77 -	7 -	(20) -	134 -
Non controlling interests Profit/(loss) before tax attributable to	(0)	(0)	-	-	-	(0)
shareholders	63	6	77	7	(20)	134

	31 December 2020
	Bulgaria	Serbia Cyprus Luxembourg Romania
	€ million	€ million	€ million	€ million	€ million	€ million
Segment assets⁽²⁾	6,010	1,691	6,852	1,892	301	16,694
Segment liabilities⁽²⁾	5,359	1,275	6,232	1,699	481	14,993

	31 December 2019
			Wealth	Global & Capital	Investment		Other and Elimination
	Retail	Corporate	Management	Markets	Property	International	center	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Net interest income	509	302	12	222	(12)	381	(37)	1,377
Net commission income	67	70	30	21	0	103	3	294
Other net revenue	(2)	27	0	29	113	30	(24)	173
Total external revenue	574	399	42	272	101	514	(58)	1,844
Inter-segment revenue	17	13	1	(22)	1	(5)	(5)	-
Total revenue	591	412	43	250	102	509	(63)	1,844
Operating expenses Impairment losses relating to loans and	(430)	(118)	(23)	(75)	(21)	(224)	(10)	(901)
advances to customers	(399)	(130)	(0)	-	-	(95)	-	(624)
Impairment losses on goodwill Other impairment losses and provisions	-	-	-	-	(62)	-	-	(62)
(note 12)	(8)	(2)	(0)	33	(2)	(6)	(47)	(32)
Share of results of associates and joint ventures	(0)	0	20	-	3	(0)	0	23
Profit/(loss) before tax from continuing operations before restructuring costs	(246)	162	40	208	20	184	(120)	248
Restructuring costs (note 12)	(19)	(3)	(0)	(0)	-	(17)	(49)	(88)
Profit/(loss) before tax from continuing operations	(265)	159	40	208	20	167	(169)	160
Loss before tax from discontinued operations	-	-	-	-	-	(3)	(0)	(3)
Non controlling interests	-	-	-	-	-	(0)	0	0
Profit/(loss) before tax attributable to shareholders	(265)	159	40	208	20	164	(169)	157

	31 December 2019
							Other and
			Wealth	Global & Capital	Investment		Elimination
	Retail	Corporate	Management	Markets	Property	International	center⁽¹⁾	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Segment assets	20,029	13,515	111	14,464	1,216	15,057	369	64,761
Segment liabilities	25,302	7,368	2,062	8,307	202	13,484	1,369	58,094

	31 December 2019
	Bulgaria	Serbia	Cyprus	Luxembourg	Romania	Total
	€ million	€ million	€ million	€ million	€ million	€ million
Net interest income	184	58	103	24	12	381
Net commission income	54	14	28	9	(2)	103
Other net revenue	23	2	2	3	0	30
Total external revenue	261	74	133	36	10	514
Inter-segment revenue	1	(1)	(0)	(4)	(1)	(5)
Total revenue	262	73	133	32	9	509
Operating expenses	(109)	(50)	(39)	(19)	(7)	(224)
Impairment losses relating to loans and
advances to customers	(42)	(26)	(11)	0	(16)	(95)
Other impairment losses and provisions Share of results of associates and joint	(4)	(1)	(1)	0	-	(6)
ventures	-	(0)	-	-	(0)	(0)
Profit/(loss) before tax from continuing
operations before restructuring costs	107	(4)	82	13	(14)	184
Restructuring costs	(17)	-	-	-	-	(17)
Profit/(loss) before tax from continuing
operations	90	(4)	82	13	(14)	167
Loss before tax from discontinued operations	-	-	-	-	(3)	(3)
Non controlling interests	(0)	(0)	-	-	-	(0)
Profit/(loss) before tax attributable to
shareholders	90	(4)	82	13	(17)	164

	31 December 2019
	Bulgaria	Serbia	Cyprus	Luxembourg	Romania	International
	€ million	€ million	€ million	€ million	€ million	€ million
Segment assets⁽²⁾	5,550	1,510	6,260	1,374	363	15,057
Segment liabilities⁽²⁾	4,966	1,101	5,698	1,189	530	13,484

(1) Interbank eliminations between International and the other Group's segments are included.

(2) Intercompany balances among the Countries have been excluded from the reported assets and liabilities of International segment.

(3) Following the derecognition of the underlying loan portfolio of the Cairo securitization, the loans of the retail and corporate segment were decreased by € 2.57 billion and € 1.27 billion respectively. The notes of the Cairo and Pillar securitizations, which were retained by the Group, amounting to € 2.4 billion and € 1.1 billion respectively, are presented in other segment.

43.2 Entity wide disclosures

Breakdown of the Group's revenue from continuing operations for each group of similar products and services is as follows:

	2020	2019
	€ million	€ million
Lending related activities	1,543	1,626
Deposits, network and asset management activities	(101)	(61)
Capital markets	643	167
Non banking and other services	316	112
Total	2,401	1,844

Information on the Country by Country Reporting based on Law 4261/2014 is provided in the Appendix.

44. Corporate Transformation-Hive down

In November 2018, the Group announced its transformation plan aiming to enable the former to deal with the challenging nonperforming loans (NPEs) reduction targets, achieve a significant balance sheet de-risking and focus on the core banking business. The aforementioned transformation plan included the merger with Grivalia, which was completed in April 2019, and the NPEs reduction Acceleration Plan comprising the steps described below:

a) In June 2019, the Group, through the special purpose financing vehicle (SPV) 'Pillar Finance Designated Activity Company' issued senior, mezzanine and junior notes of total value of ca. € 2 billion, via a securitization of NPEs, which were fully retained by the Group. In September 2019, the Group sold the 95% of the above-mentioned mezzanine and junior notes to Celidoria S.A R.L. Upon the completion of the above sale, the Group ceased to control the SPV and derecognized the underlying loan portfolio in its entirety, on the basis that it transferred substantially all the risks and rewards of the underlying loan portfolio's ownership. In addition, the Group recognized the retained notes, i.e. 100% of the senior, 5% of the mezzanine and junior notes, on its balance sheet (notes 20 and 34).

b) In June 2019, the Group, through the special purpose financing vehicles (SPVs) 'Cairo No. 1 Finance Designated Activity Company', 'Cairo No. 2 Finance Designated Activity Company' and 'Cairo No. 3 Finance Designated Activity Company', issued senior (Class A), mezzanine (Class B1 and B2) and junior (Class C1 and C2) notes of total value of ca. € 7.5 billion, via a securitization of a mixed portfolio consisting primarily of NPEs, which were fully retained by the Group. The control of the SPVs resides with the majority holder of Class B1. Accordingly, the Group, being the sole holder of the issued notes, controlled the SPVs and continued recognizing the underlying loan portfolio on its balance sheet on the basis that it retained substantially all risks and rewards of its ownership (note 34).

c) On 20 March 2020, the demerger of Eurobank Ergasias S.A. through the hive down of the banking sector and the establishment of a new company-credit institution under the corporate name 'Eurobank S.A.' was completed (as detailed in Hive Down section below). At the aforementioned date, Eurobank S.A. assumed, inter alia, 100% of the senior, 5% of the mezzanine and junior notes of the Cairo securitization. The rest of the Cairo notes, i.e. 95% of the mezzanine and junior notes, remained with Eurobank Ergasias S.A. The transaction had no accounting impact on the Group's consolidated financial statements.

On 23 March 2020, the distinctive title of Eurobank Ergasias S.A. was amended to Eurobank Holdings.

d) In December 2019, Eurobank Ergasias S.A. announced that it has entered into binding agreements with doValue S.p.A. for: (i) the sale of 80% of its subsidiary "Eurobank FPS Loans and Credits Claim Management S.A." transferred to Eurobank S.A. as part of the assets transferred through the hive down process (note 30) and (ii) the sale of 20% of the mezzanine (representing the 80% of Class B1) and 50.1% of the junior notes of the aforementioned Cairo securitization in exchange for a cash consideration of ca. € 14 million. In June 2020 the sale was completed.

Upon the sale of 20% of the mezzanine notes, which effectively represents the majority stake of the Class B1 notes, the Group ceased to control the SPVs and the related Cairo real estate companies, i.e. Cairo Estate I Single Member S.A, Cairo Estate II Single Member S.A, Cairo Estate IIΙ Single Member S.A. Furthermore, being the holder of 100% of the senior, 80% of the mezzanine and 49.9% of the junior notes, the Group, continued to recognize the underlying loan portfolio on its balance sheet on the basis that it continued to retain substantially all risks and rewards of ownership.

The table below presents the ownership distribution of Cairo notes following the steps described in points (b) to (d) above:

Cairo noteholders after the completion of the sale transaction

Cairo notes	(A) - Eurobank S.A.⁽¹⁾	(B) - Eurobank Holdings	(C) = (A) + (B) - Eurobank Holdings	Group (D) - Third parties⁽²⁾	(E) = (C) +(D) - Total issue
A Senior	100%	0%	100%	-	100%
B1 Mezzanine	5%	-	5%	20%	25%
B2 Mezzanine	-	75%	75%	-	75%
B Total	5%	75%	80%	20%	100%
C1 Junior	5%	-	5%	50.1%	55.1%
C2 Junior	-	44.9%	44.9%	-	44.9%
C Total	5%	44.9%	49.9%	50.1%	100%

(1) Transferred from Eurobank Ergasias S.A. upon hive down. (2) Sold to doValue S.p.A.

e) On 15 June 2020, Eurobank Holdings, following a decision of the Board of Directors (BoD), proceeded to the contribution of the retained Cairo notes, i.e. 75% of the mezzanine and 44.9% of the junior notes along with an amount of € 1.5 million in cash to its Cyprus-based subsidiary Mairanus Ltd, renamed to 'Cairo Mezz Plc', in exchange for the newly-issued shares of the above mentioned subsidiary. Based on the valuation, according to the provisions of Article 17 of L. 4548/2018, the fair value of the shares received by Eurobank Holdings amounted to € 57.5 million consisting of the fair value of the contributed Cairo notes of € 56 million and the cash amount of € 1.5 million (notes 23 and 34). The abovementioned BoD decision for the contribution of the Cairo notes retained by Eurobank Holdings initiated the distribution process and clearly demonstrated Management's commitment to the specific plan for the notes' disposal as the last step to the Group's Corporate Transformation Plan, and eventually the Cairo loan portfolio derecognition from its balance sheet.

Accordingly, as at 30 June 2020, the Group proceeded with the re-measurement of the portfolio's expected credit lossesin accordance with its accounting policy for the impairment of financial assets and classified as held for sale the underlying loan portfolio in accordance with the provisions of IFRS 5 'Non current assets held for sale and discontinued operations'.

The impairment loss of € 1,509 million recognized in the second quarter of 2020, was based on the fair valuation of the notesretained by the Group as at 30 June 2020 (notes 20 and 21).

f) On 7 July 2020, the BoD of Eurobank Holdings proposed to the General Shareholders' Meeting the distribution of Cairo Mezz Plc shares to Eurobank Holding's shareholders through the decrease in kind of its share capital. On 28 July 2020, the General Shareholders' Meeting approved the decrease in kind of Eurobank Holdings' share capital via the decrease of the nominal value of each ordinary share and the distribution to its shareholders of the shares issued by Cairo Mezz Plc with a value corresponding to the value of the share capital decrease, at a ratio of 1 share of Cairo Mezz Plc for every 12 Eurobank Holdings' shares already held. The Ministry of Development & Investments by virtue of its decision 81660/31.07.2020 approved the amendment of article 5 of Eurobank Holdings' Articles of Association. The impact from the distribution of Cairo Mezz Plc shares to Eurobank Holding's shareholders was the reduction by an equal amount of € 57.5 million of Eurobank Holding's share capital along with the related costs directly attributable to the equity transaction of € 0.4 million (note 37).

g) On 21 September 2020, Eurobank Holdings notified the Athens Stock Exchange Corporate Actions Committee of the aforementioned corporate action and announced that the 23rd of September 2020 was the last trading day during which its shares traded with the right to participate in the distribution of shares issued by Cairo Mezz, while from 24 September 2020 onwards they were traded on the Athens Stock Exchange with the new nominal value and without the right to participate in the aforementioned distribution. In addition, the beneficiaries of the distribution of the shares issued by Cairo Mezz Plc were Eurobank Holding's shareholders registered in the records of the Dematerialised Securities System (DSS) on 25 September 2020 (record date).

Accordingly, on 25 September 2020 the Group ceased to control Cairo Mezz Plc and derecognized the underlying loan portfolio, since following (a) the sale of 20% of the mezzanine notes and 50.1% of the junior notes to doValue S.p.A. (refer to point d above) and (b) the distribution of Cairo Mezz Plc shares to its shareholders, transferred substantially the risks and reward of portfolio's ownership and ceased to have control over the securitized loans, which resides with the Class B1 noteholders.

The derecognition of the underlying portfolio resulted in a derecognition gain of € 9 million which is presented in 'other income/(expenses)'.

The below table presents, the ownership distribution of the Cairo notes following the completion of all steps involved, as described in points (b) to (g) above, as well as the respective valuation prices of each class of notes:

Cairo noteholders after the completion of the distribution (September 2020)

Cairo notes	(A) - Eurobank S.A.⁽¹⁾	(B) - Eurobank Holdings	(C) = (A) + (B) - Eurobank Holdings Group	(D) - Cairo Mezz Plc⁽²⁾	(E) - Third parties⁽³⁾	(F) = (C) + (D) + (E) -	Total issue Valuation price
A Senior	100%	0%	100%	0%	-	100%	100%
B1 Mezzanine	5%	-	5%	-	20%	25%
B2 Mezzanine	-	0%	0%	75%	-	75%
B Total	5%	0%	5%	75%	20%	100%	5%
C1 Junior	5%	-	5%	-	50.1%	55.1%
C2 Junior	-	0%	0%	44.9%	-	44.9%
C Total	5%	0%	5%	44.9%	50.1%	100%	0%

(1) Transferred from Eurobank Ergasias S.A. upon hive down.

(2) Contributed by Eurobank Holdings and subsequently distributed to its shareholders.

(3) Sold to doValue S.p.A.

Following the completion of all steps involved, as described in points (b) to (g) above, the total equity impact for the Group is presented in the below table:

	NAV
	Impact

Gain from sale of FPS	173
Impairment loss on Cairo loans (note 20)⁽¹⁾	(1,508)
Distribution of Cairo Mezz Plc shares	(58)
Gain on derecognition of Cairo loans	9
Total	(1,384)

(1) Including related expenses, net of tax.

Hive down

On 31 July 2019, the BoD of Eurobank Ergasias S.A. approved the Draft Demerger Deed through the aforementioned hive down and establishment of a new company-credit institution, pursuant to Article 16 of Law 2515/1997 and Articles 57 (3) and 59-74 of Law 4601/2019, as currently in force. In particular, the demerger would involve the hive-down of the banking sector of Eurobank Ergasias S.A., to which the assets and the liabilities are included, as described on the transformation balance sheet of the hived-down sector as at 30 June 2019 ("Transformation Date"). In accordance with the Draft Demerger Deed, Eurobank Ergasias S.A. retained the 95% of the Pillar mezzanine and junior notes which in September 2019 were sold to a third party investor, as well as the participation in Pillar DAC and the related Pillar real estate entity.

On 20 March 2020, the demerger of Eurobank Ergasias S.A. through the banking sector's hive down and the establishment of a new company-credit institution ("Demerger") under the corporate name "Eurobank S.A" as well as the Articles of Association of the Beneficiary were approved by virtue of the decision of the Ministry of Development and Investments No 31847/20.03.2020, which was registered on the same day in the General Commercial Registry. At the aforementioned date: a) the Demerged Entity becomes the shareholder of the Beneficiary by acquiring all the shares issued by the Beneficiary and more specifically 3,683,244,830 common

registered shares, of a nominal value of € 1.10 each and b) the Beneficiary substitutes the Demerged Entity, by way of universal succession, to all the transferred assets and liabilities, as set out in the transformation balance sheet of the hived down sector as at 30 June 2019 and formed up to 20 March 2020, day of the Demerger's completion.

On 23 March 2020, the Articles of Association of the Demerged Entity were amended with the decision of the Ministry of Development and Investments, Number 32403/23.03.2020, which was registered on the same day in the General Commercial Registry. According to article 1 of the Articles of Association, the corporate name and the distinctive title of the Demerged Entity is amended to "Eurobank Ergasias Services and Holdings S.A." and "Eurobank Holdings" respectively. The date of change of the Company's corporate name and distinctive title in the Athens Exchange was set for 24 March 2020.

The hive down of the banking sector (including subsidiaries/associates) constitutes a common control transaction, which involves a new entity to effect the combination of entities under common control. As a common control transaction, the hive down does not fall within the scope of the IFRS 3 'Business Combinations'; furthermore, it is a common control transaction that involves the set-up of a new company, which is neither the acquirer, nor a business and therefore it is not a business combination as defined by IFRS 3. Since IFRS 3 guidance does not apply, and the hive down does not meet the definition of a business combination under common control, it is accounted for as a capital re-organisation of the transferred business on the basis that no substantive economic change has occurred. In line with the Group's accounting policy for business combinations that involve the formation of a new entity, in case of a capital reorganization, the acquiring entity incorporates the assets and liabilities of the acquired entity at their carrying amounts, as presented in the books of that acquired entity, rather than those from the highest level of common control. Any difference between the cost of the transaction and the carrying amount of the net assets acquired isrecognized in the equity of the new entity. In addition, the capital reorganization transactions do not have any impact on the Group's consolidated financial statements.

Accordingly, in the separate financial statements of Eurobank Holdings, the assets and liabilities of the business transferred (including investments in subsidiaries and associates) to Eurobank (Beneficiary) were derecognised and the investment in the Beneficiary was recognised at cost, which is the carrying value of the net assets given up. The Beneficiary respectively incorporated the assets and liabilities of the existing business at their pre-combination carrying amounts with a corresponding increase in share capital. Preexisting valuation reserves under IFRS that were transferred to the Beneficiary were separately recognized in the Beneficiary's total equity.

In accordance with the Demerger Deed, Eurobank Holdings maintained activities and assets that are not related to the main banking activities but are mainly related to the strategic planning of the administration of non-performing loans and the provision of services to the Group companies and third parties. Furthermore, Eurobank Holdings retained the 95% of Cairo mezzanine and junior notes, the preferred securities and the participations in certain subsidiaries including Be Business Exchanges S.A., Cairo DACs, Pillar and Cairo real estate entities. In case of any assets or liabilities that would not be possible to be transferred, in the context of the above mentioned Draft Demerger Deed, the Demerged Entity undertakes the obligation to collect or liquidate the assets in accordance with the Beneficiary's instructions whereas the Beneficiary undertakes the obligation to indemnify the Demerged Entity for the settlement of the liabilities including any arising costs or losses. Accordingly, the Beneficiary, receives the remaining assets (including 100% of Cairo senior and 5% of mezzanine and junior notesthat were recognized at fair value) and liabilitiesthat constitute the banking sector, by issuing shares to the Demerged entity.

The table below presents at the hive down date, i.e. 20 March 2020, Eurobank Ergasias S.A. balance sheet before the hive down, and the adjustments made to derive both balance sheets of Eurobank and Eurobank Holdings after hive down.

			20 March 2020
	(A) - Eurobank Ergasias S.A. € million	(B) - Intercompany (IC) net assets contributed to Eurobank S.A € million	(C) - Total net assets contributed to Eurobank S.A. € million	(D) - IC net assets of Eurobank Holdings & investment in Eurobank S.A. € million	(E) = (A) + (B) - (C) + (D) Eurobank Holdings S.A. € million

ASSETS
Cash and balances with central banks	1,916		1,916		-
Due from credit institutions	3,887		3,817	103	1 173
Securities held for trading	28		28		-
Derivative financial instruments	2,381		2,381		-
Loans and advances to customers	30,023	2,425 2	28,592		3,856
Investment securities	6,995		6,995	950	3 950
Shares in subsidiaries	1,855		1,854	4,090	4 4,091
Investments in associates and joint ventures	101		101		-
Property and equipment	567		567		0
Investment property	873		873		-
Goodwill and other intangible assets	316		316		0
Deferred tax assets	4,832		4,832		-
Other assets	1,778	4	1,779		3
Assets of disposal groups classified as held for sale	41		41		-
Total assets	55,593	2,429	54,092	5,143	9,073

LIABILITIES
Due to central banks	2,700		2,700		-
Due to credit institutions	7,677		7,677		-
Derivative financial instruments	2,904		2,904		-
Due to customers	33,169	103 1	33,272		-
Debt securities in issue	2,412	3 950	2,402	2,425	2 3,385
Other liabilities	1,064		1,047	4	21
Total liabilities	49,926	1,053	50,002	2,429	3,406
Total equity	5,667	1,376	4,090 4	2,714	5,667

Notes

€ 103 million refer to deposits of Eurobank Holdings with Eurobank S.A.
€ 2,425 million refer to the notes of Cairo securitizations retained by Eurobank S.A. (i.e. 100% senior notes, 5% of mezzanine and junior notes).
€ 950 million refer to Tier 2 notes issued by Eurobank S.A. and retained by Eurobank Holdings.
€ 4,090 million refer to the investment in Eurobank S.A. held by Eurobank Holdings corresponding to the net assets contributed to the former by Eurobank Ergasias S.A.; Eurobank S.A. total equity of € 4,090 million as at 20 March 2020 comprises (a) share capital of € 4,051.6 million as it has been determined based on the assets and liabilities included in the transformation balance sheet of the hived-down banking sector of Eurobank Ergasias S.A. as at 30 June 2019, (b) pre-existing valuation reserves of € 238.7 million and (c) retained losses of € 200.4 million.

45. Post balance sheet events

Details of post balance sheet events are provided in the following notes:

Note 2.1 – Basis of preparation Note 4 – Capital Management Note 5.2 – Financial risk factors Note 13 - Income tax Note 23 – Group composition Note 24 – Investments in associates and joint ventures Note 31 - Due to central banks Note 34 – Debt securities in issue Note 48 - Board of Directors

46. Related parties

On 20 March 2020, Eurobank Ergasias S.A. ( "Demerged Entity") announced that its demerger through the banking sector's hive down and the establishment of a new company-credit institution ("Demerger") under the corporate name "Eurobank S.A." ( "Bank") was approved, while on 23 March 2020 the Demerged Entity was renamed to "Eurobank Ergasias Services and Holdings S.A." ("Company" or "Eurobank Holdings'') (note 44). Following the above, the key management personnel (KMP) of the Demerged Entity remained as the Bank's KMP. Furthermore, the Board of Directors (BoD) of Eurobank Holdings is the same as the BoD of the Bank and part of the KMP of the Bank provides services to Eurobank Holdings according to the terms of the relevant agreement between the two entities. As at 31 December 2020, the percentage of the Company's ordinary shares with voting rights held by the Hellenic Financial Stability Fund (HFSF) stands at 1.40%. The HFSF is considered to have significant influence over the Company pursuant to the provisions of the Law 3864/2010, as in force, the Relationship Framework Agreement (RFA) the Demerged Entity has entered into with the HFSF on 4 December 2015 and the Tripartite Relationship Framework Agreement (TRFA) between the Bank, the Company and the HFSF signed on 23 March 2020. Further information in respect of the HFSF rights based on the aforementioned framework is provided in the section "Report of the Directors and Corporate Governance Statement" of the Annual Financial Report for the year ended 31 December 2020.

A number of banking transactions are entered into with related parties in the normal course of business and are conducted on an arm's length basis. These include loans, deposits and guarantees. In addition, as part of its normal course of business in investment banking activities, the Group at times may hold positions in debt and equity instruments of related parties.

The outstanding balances of the transactions with (a) Fairfax group, (b) the key management personnel (KMP) and the entities controlled or jointly controlled by KMP and (c) the associates and joint ventures, as well as and the relating income and expenses are as follows:

		31 December 2020			31 December 2019
	Fairfax Group	KMP and Entities controlled or jointly controlled by KMP⁽¹⁾	Associates and joint ventures	Fairfax Group	KMP and Entities controlled or jointly controlled by KMP⁽¹⁾	Associates and joint ventures
Loans and advances to	€ million	€ million	€ million	€ million	€ million	€ million
customers Derivative financial	9.02	4.69	28.94	3.33	6.20	24.59
instruments - assets	0.10	-	-	-	-	-
Other assets	1.92	0.27	65.33	-	-	9.81
Due to customers	0.15	22.29	114.06	3.72	20.34	47.75
Other liabilities	0.01	0.96	19.82	-	0.04	3.76
Net interest income Net banking fee and	0.14	(0.01)	(3.40)	-	(0.03)	(3.90)
commission income	-	0.03	12.49	-	0.02	17.22
Net trading income Impairment losses relating to loans and advances including	-	-	(0.02)	-	-	0.25
relative fees Other operating	(0.03)	-	(41.19)	-	-	(4.53)
income/(expenses)⁽²⁾	8.87	(14.11)	(15.02)	-	(7.61)	(23.84)
Guarantees issued Guarantees received	- -	0.01 0.02	2.00 -	0.40 -	0.01 0.03	2.00 -

(1) Includes the key management personnel of the Group and their close family members.

(2) For the year ended 31 December 2020, the amount of € 14.11 million (31 December 2019: € 7.61 million) relates to the services agreement with Grivalia Management Company S.A. for the management of the Group's real estate properties.

For the year ended 31 December 2020, there were no material transactions with the HFSF. In addition, as at 31 December 2020 the loans, net of provisions, granted to non consolidated entities controlled by the Bank pursuant to the terms of the relevant share pledge agreements amounted to € 0.3 million (2019: € 3 million).

For the year ended 31 December 2020, a reversal of impairment of € 0.4 million (31 December 2019: a reversal of impairment of € 0.1 million) has been recorded against loan balances with Group's associates and joint ventures, while the respective impairment allowance amounts to € 0,1 million (31 December 2019: € 0.5 million). In addition, as at 31 December 2020, the fair value adjustment for loans to Group's associates and joint ventures measured at FVTPL amounts to € 17.7 million.

Key management compensation (directors and other key management personnel of the Group)

Key management personnel are entitled to compensation in the form of short-term employee benefits of € 6.72 million (2019: € 6.90 million) and long-term employee benefits of € 0.98 million (2019: € 1.05 million). In addition, as at 31 December 2020, the defined benefit obligation for the KMP amounts to € 1.82 million ((31 December 2019: € 1.70 million), while the respective cost for the year through the income statement (including adjustment in past service cost) amounts to € 0.07 million (31 December 2019: € 0.29 million) and the other comprehensive income (actuarial gains) amounts to € 0.06 million (31 December 2019: € 0.17 million loss).

47. External Auditors

The Company has adopted a Policy on External Auditors' Independence which provides amongst others, for the definition of the permitted and non-permitted services the Group auditors may provide further to the statutory audit. For any such services to be assigned to the Group's auditors there are specific controlling mechanisms in order for the Company's Audit Committee to ensure there is proper balance between audit and non-audit work.

The total fees of the Group's principal independent auditor "KPMG Certified Auditors", along with the KPMG network, for audit and other services provided are analyzed as follows:

	2020	2019
	€ million	€ million
Statutory audit⁽¹⁾	(2.6)	(2.3)
Tax certificate	(0.4)	(0.4)
Other audit related assignments	(1.0)	(0.6)
Non audit assignments	(0.1)	(0.2)
Total	(4.1)	(3.5)

(1) Includes fees for statutory audit of the annual standalone and consolidated financial statements.

It is noted that the non-audit assignmentsfees of "KPMG Certified Auditors A.E." Greece,statutory auditor ofthe Company, amounted to € 0.03 million.

48. Board of Directors

Further to that:

Mr. Theodoros Kalantonis, submitted his resignation, effective as of 3 April 2020.
The BoD by its decision dated 8 April 2020, appointed Ms. Alice Gregoriadi and Ms. Irene Rouvitha Panou as their new independent non-executive members, in replacement of the resigned independent non-executive members Mr. Richard Boucher and Mr. Nikolaos Bertsos, their resignations being effective as of 8 April 2020, and their term of office will expire concurrently with the term of office of the other members of the BoD.
Mr. George Μyhal, submitted his resignation, effective as of 10 December 2020. The BoD by its decision the same date appointed Ms. Cinzia Basile as new independent Non-Executive Director, in replacement of the resigned independent nonexecutive member Mr. George Myhal for an equal term to the remaining term of the resigned member.
The BoD by its decision dated 10 December 2020 appointed Mr. Andreas Athanasopoulos as new executive Director in replacement of the resigned executive Director Mr. Theodoros Kalantonis for an equal term to the remaining term of the resigned member.
The BoD by its decision dated 28 January 2021, appointed Ms. Efthymia Deli as the new representative of the HFSF and nonexecutive member of Eurobank Holdings BoD in replacement of the departing Mr. Dimitrios Miskou, according to the provisions of Law 3864/2010 and the existing Relationship Framework Agreement with the HFSF (TRFA), for an equal term to the remaining term of the resigned member.

G. Zanias	Chairman, Non-Executive
G. Chryssikos	Vice Chairman, Non-Executive
F. Karavias	Chief Executive Officer
S. Ioannou	Deputy Chief Executive Officer
K. Vassiliou	Deputy Chief Executive Officer
A. Athanasopoulos	Deputy Chief Executive Officer
B.P. Martin	Non-Executive Independent
A. Gregoriadi	Non-Executive Independent
I. Rouvitha- Panou	Non-Executive Independent
R. Kakar	Non-Executive Independent
J. Mirza	Non-Executive Independent
C. Basile	Non-Executive Independent
E. Deli	Non-Executive (HFSF representative under Law 3864/2010)

Athens, 12 April 2021

CHAIRMAN OF THE BOARD OF DIRECTORS

Georgios P. Zanias Fokion C. Karavias Harris V. Kokologiannis I.D. No ΑI - 414343 I.D. No ΑΙ - 677962 I.D. No AN - 582334

CHIEF EXECUTIVE OFFICER GENERAL MANAGER OF GROUP FINANCE GROUP CHIEF FINANCIAL OFFICER

APPENDIX – Disclosures under Law 4261/2014

Country by Country Reporting

Pursuant to article 81 of Law 4261/2014, which incorporated article 89 of Directive 2013/36/EC into the Greek legislation, the Group provides the following information for each country in which it has an establishment:

(i) Names, nature of activities and geographical location.
(ii) The operating income (turnover), the profit/(loss) before tax, the tax on profit/ (loss) and the current tax on a consolidated basis for each country; intercompany transactions among countries are eliminated through the line 'Intra-Group amounts'. The amounts disclosed are prepared on the same basis as the Group's financial statements for the year ended 31 December 2020.
(iii) The number of employees on a full time equivalent basis.
(iv) The public subsidies received.

For the listing of the Bank's subsidiaries at 31 December 2020, the country of their incorporation and the line of their business refer to note 23.

The information per country is set out below:

	Year ended 31 December 2020
	Operating income	Profit/(loss) before tax	Tax on profit/(loss)	Current tax	Number of employees at 31
	€ million	€ million	€ million	€ million	December
Greece	1,954	(1,037)	(317)	(17)	6,761
Bulgaria	232	68	0	(6)	2,919
Romania	3	(2)	(0)	(0)	19
Cyprus	109	51	(12)	(13)	433
Serbia	69	11	(2)	(0)	1,246
Luxembourg⁽¹⁾	38	16	(4)	(4)	123
Turkey	(0)	(0)	(2)	(2)	-
Netherlands	(4)	(5)	-	-	-
Other countries ⁽²⁾	0	0	-	-	-
Intra-Group amounts	(1)	-	-	-	-
Total from continuing operations	2,401	(897)	(337)	(42)	11,501

(1) The operations of Eurobank Private Bank Luxembourg S.A.'s branch in London are included within Luxembourg.

(2) Amounts reported under 'Other countries' refer to (a) the Group's SPVs issuing EMTNs and preferred securities i.e. ERB Hellas Plc in the United Kingdom, ERB Hellas (Cayman Islands) Ltd in Cayman Islands and ERB Hellas funding Ltd in Channel Islands and (b) a holding company, Berberis investments Ltd in Channel Islands.

For the year ended 31 December 2020, a benefit of € 21.2 million that is attributable to the targeted longer-term refinancing operations (TLTRO III) of the European Central Bank has been recognised in the income statement (note 31).

Article 82 of Law 4261/2014

Due to the loss in 2020, the Group's return on assets is negative.

KPMG Certified Auditors S.A. 3 Stratigou Tombra Street Aghia Paraskevi 153 42 Athens, Greece Telephone +30 210 6062100 Fax +30 210 6062111

Independent Auditor's Report

To the Shareholders of Eurobank Ergasias Services and Holdings S.A.

Report on the Audit of the financial statements

Opinion

We have audited the accompanying financial statements of Eurobank Ergasias Services and Holdings S.A. (the "Company") which comprise the Balance Sheet as at 31 December 2020, the statements of Income and Other Comprehensive income, changes in Equity and Cash Flows for the year then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Eurobank Ergasias Services and Holdings S.A.. as at 31 December 2020 and its financial performance and its cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISA), which have been incorporated in Greek legislation. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the financial statements section of our report. We are independent of the Company in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants, as it has been incorporated into Greek legislation, and the ethical requirements that are relevant to the audit of the financial statements in Greece and we have fulfilled our ethical responsibilities in accordance with the requirements of the applicable legislation and the aforementioned Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

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

Hive down and derecognition of loans following transfer through securitization (Cairo transaction)

Refer to Note 4, to the financial statements.

The key audit matter

How the matter was addressed in our
audit

The Company in order to expedite the
NPE reduction acceleration plan and in
line with its strategic plan proceed to
the following actions:
In June 2019 proceed in the
securitization of euro 7.5 billion of NPE
loans (Cairo securitization).
In March 2020 Eurobank Ergasias
Services and Holdings S.A. (former
Eurobank Ergasias S.A) proceeded to
the hive down of the banking sector
that was transferred to a newly
established financial institution named
Eurobank S.A
Finally, the Company proceeded in the
distribution of the shares of the SPV
that possessed the mezzanine and
junior notes to its shareholders. Upon
the completion of the above
transaction the Company ceased to
control the securitized loans and
derecognized the loans (Cairo
transaction). The impairment loss that
the Company recognized for Cairo
portfolio amounted to euro 1,5 billion
before tax.

Our audit procedures included, among
others in order to evaluate the Company's
process in establishing the hive down and
its position on derecognition of transferred
loans:
a)
We examined the related legal
documents for the hive down, the
transformation balance sheet and the
related accounting entries to
ascertain whether this was done in
accordance with IFRS.
b)
We examined relevant asset transfer
agreements and other related legal
documents including the operational
agreement of the related
securitization vehicles as well as the
relevant quantitative assessment
performed by the Company to
ascertain whether the criteria for
derecognition according to IFRS are
met.
c)
We analysed the contractual terms,
substantial assumptions and
conditions to assess if the Company
retained control over the transferred
loans.

Due to the complexity and magnitude
of the above transactions and the
significance of their relating accounting

d)
We reviewed and assessed the
accounting policy of the Company
and the accounting assessment for
the specific transactions.

effect we have considered above transaction as a key audit matter. We examined the adequacy of the disclosures about these transactions in the financial statements.

Other Information

Management is responsible for the other information. The other information comprises the information included in the Board of Directors' Report and the Declarations of the Members of the Board of Directors but does not include the financial statements and our Auditor's Report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the financial statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with International Financial Reporting Standards as adopted by the European Union, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Audit Committee (article 44 of L. 4449/2017) of the Company is responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs which have been incorporated in Greek legislation will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the

aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, which have been incorporated in Greek legislation, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.
Conclude on the appropriateness of Management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independenceand communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors' report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a

matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. Additional Report to the Audit Committee

Our audit opinion on the financial statements is consistent with the Additional Report to the Audit Committee of the Company dated 12 April 2021, pursuant to the requirements of article 11 of the Regulation 537/2014 of the European Union (EU).

2. Provision of non Audit Services

We have not provided to the Company any prohibited non – audit services referred to in article 5 of regulation (EU) 537/2014.

The permissible non-audit services that we have provided to the Company during the year ended 31 December 2020 are disclosed in Note 24 of the accompanying financial statements.

3. Appointment of Auditors

Athens, 15 April 2021

KPMG Certified Auditors S.A. AM SOEL 114

Harry Sirounis, Certified Auditor AM SOEL 19071

EUROBANK ERGASIAS SERVICES and HOLDINGS S.A.

F I N A N C I A L S T A T E M E N T S

FOR THE YEAR ENDED

31 DECEMBER 2020

8 Othonos Street, Athens 105 57, Greece www.eurobankholdings.gr, Tel.: (+30) 214 40 61000 General Commercial Registry No: 000223001000

Index to the Financial StatementsPage
Balance Sheet 1
Income Statement 2
Statement of Comprehensive Income 3
Statement of Changes in Equity4
Cash Flow Statement5

1.	General information 6
2.	Basis of preparation and principal accounting policies 6
2.1	Basis of preparation6
2.2	Principal accounting policies12
3.	Critical accounting estimates and judgments in applying accounting policies33
4.	Corporate Transformation-Hive down34
5.	Financial risk management and fair value 39
5.1	Financial risk factors and risk management39
5.2	Fair value of financial assets and liabilities40
6.	Net interest income 41
7.	Commission income/(expense) 41
8.	Operating expenses41
9.	Impairment allowance for loans and advances to customers42
10.	Income tax 44
11.	Discontinued operations45
12.	Loans and advances to customers46
13.	Investment securities49
14.	Shares in subsidiaries49
15.	Other assets49
16.	Debt securities in issue 50
17.	Other liabilities 51
18.	Share capital and share premium52
19.	Reserves and retained earnings53
20.	Hybrid capital53
21.	Cash and cash equivalents54
22.	Post balance sheet events 54
23.	Related parties54
24.	External Auditors56
25.	Board of Directors56

Balance Sheet

		31 December	31 December
		2020	2019
	Note	€ million	€ million
ASSETS
Cash and balances with central banks		-	2,626
Due from credit institutions	5.1	14	3,459
Securities held for trading		-	50
Derivative financial instruments		-	2,278
Loans and advances to customers	12	-	29,698
Investment securities	13	942	6,580
Shares in subsidiaries	14	4,091	1,855
Investments in associates and joint ventures		-	100
Property and equipment		0	564
Investment property		-	721
Goodwill and other intangible assets		0	313
Deferred tax assets	10	-	4,754
Other assets	15	4	1,799
Assets of disposal groups classified as held for sale		-	49
Total assets		5,051	54,846
LIABILITIES
Due to central banks		-	1,900
Due to credit institutions		-	8,201
Derivative financial instruments		-	2,724
Due to customers		-	32,693
Debt securities in issue	16	947	2,390
Other liabilities	17	1	1,081
Total liabilities		948	48,989
EQUITY
Share capital	18	816	853
Share premium	18	8,056	8,056
Reserves and retained earnings	19	(4,769)	(3,054)
Hybrid capital	20	-	2
Total equity		4,103	5,857
Total equity and liabilities		5,051	54,846

Income Statement

2019 Restated (1) € million 186 -





186
(12)
(42)
132
(8)
124

(207)
-
(83)
24
(59)
90

(1) The comparative information has been adjusted with the presentation of the operations of the hived down banking sector as discontinued (note 11).

Statement of Comprehensive Income

	Year ended 31 December
2020			2019
	€ million		Restated (1) € million

Net profit/(loss)		(1,512)	31
Other comprehensive income:
Items that are or may be reclassified subsequently to profit or loss:
Cash flow hedges
- changes in fair value, net of tax	8		12
- transfer to net profit, net of tax	(1)	7	(17)	(5)
Debt securities at FVOCI
- changes in fair value, net of tax	(143)		696
- transfer to net profit, net of tax	(46)	(189)	(287)	409
		(182)		404
Items that will not be reclassified to profit or loss:
-Actuarial gains/ (losses) on post employment
benefit obligations,net of tax		(0)		(4)
Other comprehensive income		(182)		400
Total comprehensive income
- from continuing operations		(1,471)		(59)
- from discontinued operations		(223)		490
		(1,694)		431

(1) The comparative information has been adjusted with the presentation of the operations of the hived down banking sector as discontinued (note 11).

			Reserves and
		Share	Retained
	Share capital	premium	earnings	Hybrid capital	Total
	€ million	€ million	€ million	€ million	€ million
Balance at 1 January 2019	656	8,056	(4,371)	42	4,383
Net profit	-	-	31	-	31
Other comprehensive income	-	-	400	-	400
Total comprehensive income for the year ended 31
December 2019	-	-	431	-	431
Merger with Grivalia Properties REIC	197	-	890	-	1,087
Hybrid capital's dividend paid, net of tax	-	-	(4)	(40)	(44)
	197	-	886	(40)	1,043
Balance at 31 December 2019	853	8,056	(3,054)	2	5,857
Balance at 1 January 2020	853	8,056	(3,054)	2	5,857
Net loss	-	-	(1,512)	-	(1,512)
Other comprehensive income	-	-	(182)	-	(182)
Total comprehensive income for the year ended 31
December 2020	-	-	(1,694)	-	(1,694)
Share capital decrease and capitalization of taxed
reserves (note 18)	(37)	-	(21)	-	(58)
Hybrid capital's redemption
and dividend paid, net of tax	-	-	(0)	(2)	(2)
	(37)	-	(21)	(2)	(60)
Balance at 31 December 2020	816	8,056	(4,769)	-	4,103
	Note 18	Note 18	Note 19	Note 20

Cash Flow Statement

Eurobank
Holdings

		Year ended 31 December
		2020	2019
			Restated (1)
	Note	€ million	€ million
Cash flows from continuing operating activities
Profit/(loss) before income tax from continuing operations Adjustments for :		(1,471)	(83)
Impairment losses relating to loans and advances to customers	9	1,508	207
Other impairment losses and provisions		7	-
Depreciation and amortisation		0	-
Other adjustments		(3)	-
		41	124
Changes in operating assets and liabilities
Net (increase)/decrease in due from credit institutions		2	-
Net (increase)/decrease in loans and advances to customers		(24)	13
Net (increase)/decrease in other assets		(7)	-
Net increase/(decrease) in other liabilities		3	-
		(26)	13
Net cash from/(used in) continuing operating activities		15	137
Cash flows from continuing investing activities
Acquisition of subsidiaries and participation in
capital increases	14	(1)	-
Net cash from/(used in) continuing investing activities		(1)	-
Net increase in cash and cash equivalents from continuing operations		14	137
Net cash flows from discontinued operating activities		(74)	1,377
Net cash flows from discontinued investing activities		(903)	1,150
Net cash flows from discontinued financing activities		(8)	(381)
Net increase/(decrease) in cash and cash equivalents from discontinued operations		(985)	2,146
Cash and cash equivalents of hived down banking sector on 20 March 2020		(1,788)	-
Cash and cash equivalents at beginning of year		2,773	490
Cash and cash equivalents at end of year	21	14	2,773

(1) The comparative information has been adjusted with the presentation of the operations of the hived down banking sector as discontinued (note 11).

1. General information

On 20 March 2020, the demerger of "Eurobank Ergasias S.A." (Eurobank Ergasias or Demerged Entity) through the banking sector's hive down and its transfer to a new credit institution that has been established under the corporate name "Eurobank S.A." (the Bank) was completed. Following the above, the corporate name of the Demerged Entity has been amended to "Eurobank Ergasias Services and Holdings S.A." (the Company or Eurobank Holdings) (note 4).

Eurobank Holdings is a holding company, parent of Eurobank S.A. and its subsidiaries (Eurobank S.A Group), and along with its other subsidiaries held directly, form Eurobank Holdings Group (the Group). The Company operates mainly in Greece and through Eurobank's subsidiaries in Central and Southeastern Europe. Its main activities relate to the strategic planning of the administration of non-performing loans and the provision of services to its subsidiaries and third parties, while the Eurobank S.A. Group is active in retail, corporate and private banking, asset management, treasury, capital markets and other services. The Company is incorporated in Greece and its shares are listed on the Athens Stock Exchange.

These financial statements were approved by the Board of Directors on 12 April 2021. The Ιndependent Auditor's Report is included in the section V of the Annual Financial Report.

2. Basis of preparation and principal accounting policies

The financial statements of the Company have been prepared on a going concern basis and in accordance with the principal accounting policies set out below:

2.1 Basis of preparation

The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (IFRS) issued by the IASB, as endorsed by the European Union (EU), and in particular with those standards and interpretations, issued and effective or issued and early adopted as at the time of preparing these financial statements.

The financial statements are prepared under the historical cost basis except for the financial assets measured at fair value through other comprehensive income, financial assets and financial liabilities (including derivative instruments) measured at fair-valuethrough-profit-or-loss and investment property measured at fair value.

On 20 March 2020, the demerger of Eurobank Ergasias S.A. (Demerged Entity) through the banking sector's hive down and the establishment of a new company-credit institution under the corporate name 'Eurobank S.A.' (Beneficiary) was completed. The hive down was accounted for as a capital reorganization of the transferred business on the basis that no substantive economic change has occurred. Accordingly, as at the aforementioned date, the assets and liabilities transferred to Eurobank S.A. were derecognised from the balance sheet of Eurobank Ergasias S.A. and an investment in the Beneficiary was recognised at cost, which is the carrying value of the net assets given up (notes 1 and 4). In addition, on 23 March 2020, the corporate name of the Demerged Entity was amended to 'Eurobank Ergasias Services and Holdings S.A'. As a result of the accounting treatment of the hive down, the accounting policies in these financial statements for the period 1 January to 20 March 2020 (i.e. date of hive down) are consistent with those in the financial statements of Eurobank Ergasias S.A. for the year ended 31 December 2019, except as described in note 2.1.1 "New and amended standards and interpretations". In addition, the accounting policiesset out in note 2.2, where applicable, were applied consistently for the period following the completion of the hive down.

The preparation of financial statements in accordance with IFRS requires the use of estimates and judgements that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of current events and actions, actual results ultimately may differ from those estimates.

The Company's presentation currency isthe Euro (€). Except asindicated, financial information presented in Euro has been rounded to the nearest million. The figures presented in the notes may not sum precisely to the totals provided due to rounding.

Going concern considerations

The Company's business strategy and activities are linked to those of its banking subsidiary Eurobank S.A. In this context, the directors monitor closely the capital and liquidity position of the Bank as well as the associated risks, uncertainties and the mitigating factors affecting its operations. The annual financial statements have been prepared on a going concern basis, as the Board of the Directors considered as appropriate, taking into consideration the following:

as of the fourth quarter of 2020 and the consequent pressure on the health system led to the extension of restrictive measures, including countrywide lockdowns, which have posed further uncertainties and risks for both the macroeconomic environment and the ability of numerous businessesto operate. Based on Hellenic Statistical Authority (ELSTAT) provisional data, the real GDP growth rate in 2020 registered a decrease of -8.2% on an annual basis, from 1.9% increase in 2019, mainly as a result of the drop in the final consumption expenditure and exports of services. Based on Eurostat data, the Euro-area real GDP growth rate figures were at - 6.6% and 1.3% for 2020 and 2019 respectively. According to the European Commission (EC) winter economic forecasts (February 2021) the real GDP growth rate for 2021 and 2022 is expected at 3.5% and 5% respectively. Based on ELSTAT data, the average unemployment rate stood at 16.3% in 2020 (2019: 17.3%). According to EC autumn economic forecasts (November 2020) the unemployment rate was expected at 17.5% and 16.7% for 2021 and 2022 respectively.

On the fiscal front, according to the 2021 Budget forecasts, the primary balancesfor 2020 and 2021 are expected to register a deficit of 7.2% and 3.9% of GDP respectively, as a result of the fiscal support measures, while the gross public debt is expected at 208.9% and 199.6% of GDP for 2020 and 2021 respectively. The deviation from the Enhanced Surveillance (ES) primary surplus target of 3.5% of GDP for both 2020 and 2021 will not be considered a violation of Greece's commitments undertaken in the ES framework, as on 4 March 2020 Eurogroup decided that non-permanent deviations from the agreed fiscal paths of the member-states, due to unusual effects outside the control of their governments (i.e. the effects of the pandemic), are acceptable. According to the 15 March 2021 Eurogroup, the deviation from the ES target will continue in 2022, on a preliminary basis. The aforementioned primary balance and public debt forecasts might change significantly as a result of the actual size of the public sector's support measures and the reduction in tax revenues due to the Government's relevant moratoria and the decline of economic activity.

In response to the Covid-19 outbreak, there has been an unprecedented monetary, fiscal and regulatory support to the economy and the banking system by both Greek Government and European authorities. According to the 2021 Budget, the Greek government's planned total measures aiming to address the economic effects of the Covid-19 pandemic amount to € 31.5 billion of which € 23.9 billion correspond to 2020 and € 7.6 billion to 2021, including the cost of the ruling of the Council of State on pension cuts. According to the Ministry of Finance as of 29 March 2021, the support measures are expected to further increase to € 14.5 billion for 2021 and at € 38.0 billion for 2020 and 2021. These measures include, among others: (a) the reduction of the private sector's social security contributions by 3 percentage points and the abolishment of the Special Solidarity levy for the private sector (only for 2021); the reduction of advanced income tax payment for firms and freelancers, (b) the payment by the government of the social security contributions for employees under labour suspension, (c) the suspension of VAT payments for firms affected by the Covid-19 pandemic, the social security and the tax related debt instalments for firms and freelancers, (d) the temporary economic support to wage earners under labour suspension, to seasonal employees (tourism sector), and to certain scientific sectors, (e) the Easter and Christmas bonus state contribution for employees under labour suspension; the employment subsidy under "synergasia" programme; the extension of the regular and long-term unemployment benefit, interest ratessubsidiesfor firms that remained closed during the lock down period as well as mortgage loans subsidies to households and small businesses (Gefyra I and II). The public support for 2020 included also leverage provided by the banking system of € 5.7 billion on top of the € 2.6 billion of the Public Investment Budget for cash-collaterals and the co-financing of loans to small and medium size enterprises.

On top of the above, the European Council on 21 July 2020 agreed a recovery package amounting to € 750 billion under the EC's Next Generation EU framework in order to support the recovery and resilience of the member states' economies, out of which ca € 31 billion will be available for Greece, provisionally divided to € 18.2 billion in grants and € 12.7 billion in loans. The respective amount for the Multiannual Financial Framework 2021-2027 (MFF) is at € 1,100 billion, of which ca € 40 billion will be available for Greece. Furthermore the ECB, on 24 March 2020 established a temporary Pandemic Emergency Purchase Programme (PEPP), with a financial envelope of € 1,850 billion as of mid-February 2021, out of which ca € 46 billion will be available for the purchase of Greek public and private sector securities. The PEPP came on top of the ECB liquidity measures of 12 March 2020 (additional Long Term Financing operations, more favourable terms for the Targeted Long Term Operations, new Asset Purchase Programme of € 120 billion).

On 12 March 2020, the ECB announced a number of temporary capital and operational relief measures to ensure that its directly supervised banks can continue to fulfil their role in funding the real economy. Banks will be allowed to use capital and liquidity buffers and cover Pillar 2 requirements with other than CET 1 instruments until at least the end of 2022. On the same date, the EBA and the ECB decided to postpone the stress test exercises to 2021 to allow banks to focus on and ensure continuity of their core

operations, including support for their customers. In addition, the EBA stated that there is flexibility in the implementation of the EBA Guidelines on management of non-performing and forborne exposures and called for a close dialogue between supervisors and banks, also on their non-performing exposure strategies, on a case by case basis (note 5). Furthermore, on 24 June 2020 the Regulation 2020/873 (CRR quick fix) introduced targeted amendments to the Capital Requirements Regulation (CRR) to encourage banks to continue lending during the Covid-19 pandemic.

Regarding the outlook for the next 12 months, the major macroeconomic risks and uncertainties in Greece mainly relate with the outbreak of Covid-19 pandemic and are as follows: (a) the evolution of the health crisis including the probability of the continuation of the pandemic, well after the end ofthe first half of 2021, and its negative effect on the domestic, regional and / or global economy, (b) the progress on the vaccination programmes to contain effectively the virus expansion, (c) the actual size and duration of the fiscal measures aiming to address the effect of the pandemic on the real economy and their effect on the long-term sustainability of the country's public debt, (d) the pace of the economy's recovery in 2021 and 2022, (e) the absorption capacity of the NGEU and MFF funds and the attraction of new investments in the country, (f) the implementation of the reforms and privatizations' agenda in order to meet the ES targets and milestones, and (g) the geopolitical conditions in the near or in broader region.

Materialization of the above Covid-19 related and other risks would have potentially adverse effects on the fiscal planning of the Greek sovereign and on the liquidity, solvency and profitability of the Greek banking sector, as well as on the realization of their Non Performing Exposures (NPE's) reduction plans. The Group is continuously monitoring the developments on the Covid-19 front and has increased its level of readiness, so as to accommodate decisions, initiatives and policies to protect its capital and liquidity standing as well as the fulfilment, to the maximum possible degree, of its strategic and business goals for the quarters ahead, focusing primarily on the support of its clients to overcome the challenging juncture, the mitigation of "cliff effects" post the moratoria expiration, the protection of its asset base and the resilience of its pre-provision profitability. In addition, the Group, under the extraordinary circumstances of the Covid-19 pandemic, has proceeded with the successful implementation of its Business Continuity Plan to ensure that business is continued and critical operations are unimpededly performed. In line with authorities' instructions and recommendations, the Group has taken all the required measures to ensure the health and safety of its employees and customers (e.g. implementation of teleworking, restrictions to business trips, and medical supplies for protective equipment).

Within this challenging external environment, the Group proceeded with the closing of the "Cairo" (sale of 20% of mezzanine/ 50.1% of junior Cairo securitizations' notes) and "Europe" (sale of 80% of Eurobank FPS) transactions in early June 2020, which signalled the completion of its accelerated NPE reduction plan announced in the fourth quarter of 2018. As a result the Group NPEs, following the derecognition of the Cairo securitised loan portfolio of € 7.2 billion (consisting primarily of NPEs) (note 12), were reduced to € 5.7 billion (31 December 2019: € 13 billion) driving the NPE ratio to 14.0% (31 December 2019: 29.2%) and the NPE coverage ratio to 61.9% (31 December 2019: 55.3%). In accordance with the business update for the period 2021-2022, the Group aims to proceed with a new NPE securitization of circa € 3.3 billion. Taking also into account the impact of the Covid 19 pandemic, the NPE ratio is expected to decline further to circa 9% in 2021.

As at 31 December 2020 the Group's Total Adequacy Ratio (total CAD) and Common Equity Tier 1 (CET1) ratios, taking into account the effect of the loss of € 1,508 million on Cairo transaction, the gain (after tax) of € 174 million on FPS disposal and the decrease of the share capital in kind of € 57 million (note 18), stood at 16.3% (31 December 2019: 19.2%) and 13.9% (31 December 2019: 16.7%) respectively. In January 2021, the EBA launched the 2021 EU-wide stress test exercise which will provide valuable input for assessing the resilience of the European banking sector, notably its ability to absorb shocks under adverse macroeconomic conditions, covering the period of 2021-2023. In parallel, the ECB also conductsits own stresstest for the banks it directly supervises but that are not included in the EBA-led stress test sample. Eurobank participates in the ECB-led stress test. The results of both exercises will be used to assess each bank's Pillar 2 capital needs in the context of the Supervisory Review and Evaluation Process (SREP). The stress test process is currently in progress and the results are expected by the end of July 2021.

At Group level, the net loss attributable to shareholders for the year ended 31 December 2020, including the loss on Cairo transaction and the gain of FPS disposal mentioned above as well asthe € 103 million restructuring costs(after tax), referring mainly to the cost for the new VES launched by the Group in September (note 17), the € 160 million deferred tax assets write-down (note 10) and the € 160 million goodwill impairment, amounted to € 1,213 million (2019: € 127 million profit). The adjusted net profit for the year ended 31 December 2020 amounted to € 544 million (31 December 2019: € 257 million profit). Net loss for the Company equals to €1,512 million (2019: € 31 million profit). During the same period, the Group has increased its deposits by € 2.4 billion to € 47.3 billion (2019: € 44.8 billion) and the funding from the targeted long term refinancing operations of the European Central Bank – TLTRO III programme to € 8 billion (2019: € 1.9 billion). The rise in high quality liquid assets of the Group led the respective Liquidity Coverage ratio (LCR) to 124% (31 December 2019: 97%).

Going concern assessment

2.1.1 New and amended standards and interpretations

New and amended standards adopted by the Company as of 1 January 2020

Amendments to the Conceptual Framework for Financial Reporting, including amendments to references to the Conceptual Framework in IFRS Standards

The adoption of the amended Framework had no impact on the financial statements.

Interest Rate Benchmark Reform- Phase 1: Amendments to IFRS 9, IAS 39 and IFRS 7

In September 2019, the IASB issued amendments to IFRS 9 'Financial Instruments', IAS 39 "Financial Instruments: Recognition and Measurement" and IFRS 7 "Financial Instruments: Disclosures" to address the implications for certain hedge accounting requirements related to the uncertainties arising from the market-wide reform of several interest rate benchmarks (referred to as 'IBOR reform'). As a result of the IBOR reform, there may be uncertainties about: a) the interest rate benchmark designated as a hedged risk and/or b) the timing or amount of the benchmark rate-based cash flows of the hedged item or the hedging instrument, during the period before the replacement of an existing interest rate benchmark with an alternative risk-free interest rate ('RFR'). The amendments modify certain hedge accounting requirements under IAS 39 or IFRS 9 in order to provide temporary reliefs from the potential effect of the uncertainty, during the transition period, which apply to all hedging relationshipsthat are directly affected by the IBOR reform. These reliefs are related mainly to the highly probable requirement for the cash flow hedges, the compliance with the identifiable nature of the hedged risk component and the application of prospective and retrospective effectiveness tests. The amendments to IFRS 7 require additional disclosures in relation to the hedging relationships to which the above reliefs are applied.

The IASB addresses the IBOR reform and its potential effects on financial reporting in two phases. The first phase, as described above, focuses on hedge accounting issues affecting financial reporting in the period before the interest rate benchmark reform, while the second phase, effective from 1 January 2021, focuses on issuesthat might affect financial reporting once the existing rates are replaced with alternative rates (refer below to section ''new standards, amendments to standards and interpretations not yet adopted by the Company").

The Company has adopted Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7- Phase 1) from 1 January 2020, while the amendments have been applied retrospectively to hedging relationships that existed on that date or were designated thereafter and that are directly affected by the IBOR reform.

As described in note 2.2.3, the Company elected, as a policy choice permitted under IFRS 9, to continue to apply hedge accounting in accordance with IAS 39. Therefore, the amendments to IAS 39 and IFRS 7 are applicable to the Company.

Due to the adoption of the reliefs as of 1 January 2020, the Company assumes that hedging relationships are unaffected by the uncertainties caused by the IBOR reform and they continue to be accounted for as continuing hedges.

Amendments to IFRS 3 Business Combinations

The IASB issued amendments to the definition of a business in IFRS 3 "Business Combinations" to help entities determine whether an acquired set of activities and assets is a business or not. They clarify the minimum requirements for a business, remove the assessment of whether market participants are capable of replacing any missing inputs or processes and add guidance to help entities assess whether an acquired process is substantive. In addition, with the introduction of the amendments the definitions of a business and of outputs are narrowed, while an optional fair value concentration test is introduced.

The adoption of the amendments had no impact on the financial statements.

Amendments to IAS 1 and IAS 8: Definition of Material

The definition of material in the Conceptual Framework was also amended in order to align with the revised definition in IAS 1 and IAS 8.

The adoption of the amendments had no impact on the financial statements.

New standards, amendments to standards and interpretations not yet adopted by the Company

A number of new standards and amendments to existing standards are effective after 2020, as they have not yet been endorsed by the European Union (EU), or have not been early applied by the Company. Those that may be relevant to the Company are set out below:

IAS 1, Amendments, Classification of Liabilities as Current or Non-Current (effective 1 January 2023, not yet endorsed by EU)

The amendments affect only the presentation of liabilities in the balance sheet and provide clarifications over the definition of the right to defer the settlement of a liability, while they make clear that the classification of liabilities as current or non-current should be based on rightsthat are in existence at the end of the reporting period. In addition, it is clarified that the assessment for liabilities classification made at the end of the reporting period is not affected by the expectations about whether an entity will exercise its right to defer settlement of a liability. The Board also clarified that when classifying liabilities as current or non-current, an entity can ignore only those conversion options that are recognised as equity.

The adoption of the amendments is not expected to impact the financial statements.

Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest Rate Benchmark Reform – Phase 2 (effective 1 January 2021)

The adoption of amendments are not expected to impact the financial statements.

Annual improvement to IFRSs 2018-2020 cycle: IFRS1, IFRS9 and IFRS 16 (effective 1 January 2022, not yet endorsed by EU)

The improvements introduce changes to several standards. The amendments that are relevant to the Company's activities are set out below:

The amendments to IFRS 1 'First-time Adoption of International Financial Reporting Standards' provides additional relief to a subsidiary which becomes a first-time adopter later than its parent in respect of accounting for cumulative translation differences. As a result, the amendments allow entities that have measured their assets and liabilities at carrying amounts recorded in their parent's books to also measure any cumulative translation differences using the amounts reported by the parent. This amendment will also apply to associates and joint ventures that have taken the same IFRS 1 exemption.

The amendment to IFRS 9 'Financial Instruments' clarifies which fees should be included in the 10% test for derecognition of financial liabilities. The fees to be included in the assessment are only those paid or received between the borrower (entity) and the lender,

including fees paid or received by either the borrower or lender on the other's behalf. The amendment is applied prospectively to modifications and exchanges that occur on or after the date the entity first applies the amendment.

The amendment to IFRS 16 'Leases' removes the illustration of the reimbursement of leasehold improvements, in order to avoid any potential confusion about the treatment of lease incentives.

The adoption of the amendments is not expected to impact the financial statements.

IAS 37, Amendment, Onerous Contracts – Costs of Fulfilling a Contract (effective 1 January 2022, not yet endorsed by EU)

The adoption of the amendment is not expected to impact the financial statements.

IFRS 3 - Amendments Reference to the Conceptual Framework (effective 1 January 2022, not yet endorsed by EU)

The amendments to IFRS 3 'Business Combinations' updated the reference to the current version of Conceptual Framework while added a requirement that, for obligations within the scope of IAS 37 'Provisions, Contingent Liabilities and Contingent Assets', an acquirer applies IAS 37 to determine whether at the acquisition date a present obligation exists as a result of past events. For a levy that would be within the scope of IFRIC 21 Levies, the acquirer appliesIFRIC 21 to determine whether the obligating event that gives rise to a liability to pay the levy has occurred by the acquisition date.

In addition, the issued amendments added a new paragraph to IFRS 3 to clarify that contingent assets do not qualify for recognition in a business combination at the acquisition date.

The adoption of the amendments is not expected to impact the financial statements.

IAS 8, Amendments, Definition of Accounting Estimates (effective 1 January 2023, not yet endorsed by EU)

The adoption of the amendments is not expected to impact the financial statements.

Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2: Disclosure of Accounting policies (effective 1 January 2023, not yet endorsed by EU)

IASB issued amendments to IAS 1 "Presentation of Financial Statements" to require entities to disclose their material accounting policies rather than their significant accounting policies.

Furthermore, the amendments clarify how an entity can identify material accounting policy information, while provide examples of when accounting policy information is likely to be material. The amendment to IAS 1 also clarify that immaterial accounting policy information need not be disclosed. However, if it is disclosed, it should not obscure material accounting policy information. To support this amendment the Board has also developed guidance and examples to explain and demonstrate the application of the 'four-step materiality process' described in IFRS Practice Statement 2 Making Materiality Judgements to accounting policy disclosures, in order to support the amendments to IAS 1.

The adoption of the amendments is not expected to impact the financial statements.

2.2 Principal accounting policies

2.2.1 Investments in subsidiaries, associates and joint ventures

Investments in subsidiaries, associates and joint ventures, including investments acquired through common control transactions, are accounted at cost less any impairment losses. Cost isthe fair value of the consideration given being the amount of cash orshares issued, or if that cannot be determined reliably, the consideration received together with any directly attributable costs.

As an exception to the above measurement basis, when the Company transfers an existing Group entity or business sector to a new subsidiary formed for this purpose in a share for share exchange that does not have commercial substance, the Company's investment in that newly formed subsidiary is recognized at the carrying amount of the transferred entity.

Legal mergers that involve the combination of the Company with one or more of its subsidiaries are accounted for by using the pooling of interest method (also known as merger accounting) pursuant to IAS 8 "Accounting Policies, Changes in Accounting Estimates and Errors" with reference to the most recent pronouncements of other standard-setting bodies that use a similar conceptual framework and comply with the IFRS general principles, as well as accepted industry practices. Under the pooling of interest method, the Company incorporates the acquired assets and liabilities of the merged subsidiary at their carrying amounts in the financial statements as of the date of the legal merger without any fair value adjustments. Any difference between the carrying amount of the investment in the merged subsidiary before the legal merger, and the carrying amount of net assets acquired is recognized in the Company's equity.

Legal mergers that involve the absorption of an entity by the Company, other than an entity under common control, are accounted forby using the purchase method of accounting pursuant to IFRS 3 for business combinations. The consideration transferred for the acquisition is measured at the fair value of the assets given, equity instruments issued or exchanged and liabilities undertaken at the date of acquisition, including the fair value of assets or liabilities resulting from a contingent consideration arrangement. Acquisition related costs are expensed as incurred. Under the purchase method of accounting, the identifiable assets acquired and liabilities and contingent liabilities assumed are measured initially at their fair values at the acquisition date. Any previously held interest in the acquiree is remeasured to fair value at the acquisition date with any gain or lossrecognized in the income statement.

The excess of the consideration transferred and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets of the entity acquired, is recorded as goodwill. If this is less than the fair value of the net assets of the acquiree, the difference is recognized directly in the income statement. If the initial accounting for the acquisition is incomplete by the end of the reporting period in which it occurs, the Company reports provisional amounts for the items for which the accounting isincomplete. Those provisional amounts are adjusted retrospectively during the measurement period to reflect the new information obtained about the facts and circumstancesthat existed at the acquisition date that, if known, would have affected the amounts recognized at that date. The measurement period adjustments, as mentioned above, affect accordingly the amount of goodwill that was initially recognized, while the measurement period cannot exceed one year from the acquisition date.

For acquisitions of entities not meeting the definition of a business, the Company allocates the consideration to the individual identifiable assets and liabilities based on their relative fair values at the date of acquisition. Such transactions or events do not give rise to goodwill.

Where necessary, accounting policies of merged subsidiaries or other entities have been changed to ensure consistency with the policies of the Company.

A listing of the Company's subsidiaries is set out in note 14.

2.2.2 Foreign currencies

Non-monetary assets and liabilities are translated into the functional currency at the exchange rates prevailing at initial recognition, except for non-monetary items denominated in foreign currencies that are measured at fair value which are translated at the rate of exchange at the date the fair value is determined. The exchange differences relating to these items are treated as part of the

change in fair value and are recognized in the income statement or recorded directly in equity depending on the classification of the non-monetary item.

2.2.3 Derivative financial instruments and hedging

Derivative financial instruments, including foreign exchange contracts, forward currency agreements and interest rate options(both written and purchased), currency and interest rate swaps, and other derivative financial instruments, are initially recognized in the balance sheet at fair value on the date on which a derivative contract is entered into and subsequently are re-measured at their fair value. All derivatives are carried as assets when fair value is positive and as liabilities when fair value is negative.

Embedded derivatives

On the other hand, derivatives embedded in financial liabilities, are treated as separate derivatives when their risks and characteristics are not closely related to those of the host contract and the host contract is not carried at fair value through profit or loss. These embedded derivatives are measured at fair value with changes in fair value recognized in the income statement.

The use of derivative financial instruments is inherent in the Company's activities and aims principally at managing risk effectively.

Accordingly, the Company, as part of its risk management strategy, may enter into transactions with external counterparties to hedge partially or fully interest rate, foreign currency, equity and other exposures that are generated from its activities.

The objectives of hedging with derivative financial instruments include:

Reduction of interest rate exposure that is in excess of the Company's interest rate limits
Efficient management of interest rate risk and fair value exposure
Management of future variable cash flows
Reduction of foreign currency risk or inflation risk

Hedge accounting

The Company has elected, as a policy choice permitted under IFRS 9, to continue to apply hedge accounting in accordance with IAS 39, until the project of accounting of macro hedging activities is completed by the IASB.

For hedge accounting purposes, the Company forms a hedging relationship between a hedging instrument and a related item or group of items to be hedged. A hedging instrument is a designated derivative or a designated non-derivative financial asset or financial liability whose fair value or cash flows are expected to offset changes in the fair value or cash flows of a designated hedged item.

Specifically, the Company designates certain derivatives as: (a) hedges of the exposure to changes in fair value of recognized assets or liabilities or unrecognized firm commitments (fair value hedge) and (b) hedges of the exposure to variability in cash flows of recognized assets or liabilities or highly probable forecasted transactions (cash flow hedge).

In order to apply hedge accounting, specified criteria should be met. Accordingly, at the inception of the hedge accounting relationship, the Company documents the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions, together with the method that will be used to assess the effectiveness of the hedging relationship. The Company also documents its assessment, both at inception of the hedge and on an ongoing basis, of whether the derivatives that are used in the hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items and whether the actual results of each hedge are within a range of 80-125%. If a relationship does not meet the abovementioned hedge effectiveness criteria, the Company discontinues hedge accounting prospectively. Similarly, if the hedging derivative expires or is sold, terminated or exercised, or the hedge designation is revoked, then hedge accounting is discontinued prospectively. In addition, the Company uses other derivatives, not designated in a qualifying hedge relationship, to manage its exposure primarily to interest rate and foreign currency risks. Non qualifying hedges are derivatives entered into as economic hedges of assets and liabilitiesfor which hedge accounting was not applied. The said derivative instruments are classified along with those held for trading purposes.

The method of recognizing the resulting fair value gain or loss depends on whether the derivatives are designated and qualify as hedging instruments, and if so, the nature of the item being hedged.

Furthermore, the Company may designate groups of items as hedged items, by aggregating recognized assets or liabilities or unrecognized but highly probable transactions of similar risk characteristics that share the exposure for which they are hedged. Although the overall risk exposures may be different for the individual items in the group, the specific risk being hedged will be inherent in each of the items in the group.

As described in note 2.1.1, the Company has applied IBOR reform amendments to IFRS 9, IAS 39 and IFRS 7, issued in September 2019, that provide temporary reliefs on hedging relationships due to the potential effect of the uncertainty on the amount and timing of cash flows indexed to IBOR and/or the interest benchmark designated as a hedged risk, during the period before the replacement of an existing interest rate benchmark with an alternative risk-free rate.

(i) Fair value hedge

The Company applies fair value hedging to hedge exposures primarily to changes in the fair value attributable to interest rate risk and currency risk.

The items that qualify for fair value hedge accounting include fixed rate debt securities classified as FVOCI and amortized cost financial assets, fixed rate term deposits or term loans measured at amortized cost, as well as fixed rate debt securities in issue.

The interest rate and currency risk with respect to the applicable benchmark rate may be hedged using interest rate swaps and cross currency swaps.

The Company uses the dollar-offset method in order to assess the effectiveness of fair value hedges. This is a quantitative method that involves the comparison of the change in the fair value of the hedging instrument with the change in the fair value of the hedged item attributable to the hedged risk. Even if a hedge is not expected to be highly effective in a particular period, hedge accounting is not precluded if effectiveness is expected to remain sufficiently high over the life of the hedge.

The Company discontinues hedge accounting in case the hedging instrument expires or is sold, terminated or exercised, the hedge no longer meetsthe qualifying criteria for hedge accounting, or designation isrevoked. In such cases, any adjustment to the carrying amount of the hedged item, for which the effective interest method is applied, is amortized to profit or loss over the period to maturity. Hedge ineffectiveness may arise in case of potential differences in the critical terms between the hedged item and the hedging instrument such as maturity, interest rate reset frequency and discount curves.

(ii) Cash flow hedge

The Company applies cash flow hedging to hedge exposures to variability in cash flows primarily attributable to the interest rate risk and currency risk associated with a recognized asset or liability or a highly probable forecast transaction.

The itemsthat qualify for cash flow hedging include recognized assets and liabilitiessuch as variable rate deposits or loans measured at amortized cost, variable rate debt securities in issue and foreign currency variable rate loans. The interest rate risk with respect to the applicable benchmark rate may be hedged using interest rate swaps and cross currency swaps. The foreign currency risk may be hedged using currency forwards and currency swaps.

If the hedged item is documented as a forecast transaction, the Company assesses and verifies that there is a high probability of the transaction occurring.

In order to assess the effectiveness of cash flow hedges of interest rate risk, the Company uses regression analysis which demonstratesthat there is high historical and expected future correlation between the interest rate risk designated as being hedged and the interest rate risk of the hedging instrument. For assessing the effectiveness of cash flow hedges of currency risk, the Company uses the dollar-offset method.

Amounts accumulated in equity are recycled to the income statement in the periods in which the hedged item will affect profit or loss (for example, when the forecast sale that is hedged takes place).

When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement.

(iii) Derivatives not designated as hedging instruments for hedge accounting purposes

Changes in the fair value of derivative financial instruments that are not designated as hedging instruments or do not qualify for hedge accounting are recognized in the income statement.

2.2.4 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is presented in the balance sheet when, and only when, the Company currently has a legally enforceable right to set off the recognized amounts and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

2.2.5 Income statement

(i) Interest income and expense

Interest income and expense isrecognized in the income statement for all interest bearing financial instruments on an accrual basis, using the effective interest rate (EIR) method. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument or, when appropriate, a shorter period to the gross carrying amount of the financial asset or to the amortized cost of a financial liability. When calculating the EIR for financial instruments other than purchased or originated credit-impaired, the Company estimates cash flows considering all contractual terms of the financial instrument but does not consider expected credit losses. For purchased or originated credit impaired (POCI) financial assets, the Company calculates the credit-adjusted EIR, which is the interest rate that upon the original recognition of the POCI financial asset discounts the estimated future cash flows (including expected credit losses) to the fair value of the POCI asset.

The EIR calculation includes all fees and points paid or received that are an integral part of the effective interest rate, transaction costs, and all other premiums or discounts. Transaction costs include incremental costs that are directly attributable to the acquisition or issue of a financial asset or liability.

The Company calculates interest income and expense by applying the EIR to the gross carrying amount of non-impaired financial assets (exposures in Stage 1 and 2) and to the amortized cost of financial liabilities respectively.

For financial assets that have become credit-impaired subsequent to initial recognition (exposures in Stage 3), the Company calculates interest income by applying the effective interest rate to the amortized cost of the financial asset (i.e. gross carrying amount adjusted for the expected credit loss allowance). If the asset is no longer credit-impaired, then the EIR is applied again to the gross carrying amount.

For financial assets that were credit-impaired on initial recognition (POCI) interest income is calculated by applying the creditadjusted EIR (calculated as described above) to the POCI asset's amortized cost. For such assets even if the credit risk improves, interest income does not revert to gross basis calculation. For inflation-linked instruments the Company recognizes interest income and expense by adjusting the effective interest rate on each reporting period due to changes in expected future cash flows, incorporating changes in inflation expectations over the term of the instruments. The adjusted effective interest rate is applied in order to calculate the new gross carrying amount on each reporting period.

Interest income and expense is presented separately in the income statement for all interest bearing financial instruments within net interest income.

(ii) Fees and commissions

Fee and commission received or paid that are integral to the effective interest rate on a financial asset or financial liability are included in the effective interest rate.

Other fee and commission income such as account servicing and asset management fees (including performance based fees) is recognised over time as the related services are being provided to the customer, to the extent that it is highly probable that a significant reversal of the revenue amount recognized will not occur. Transaction-based fees such as foreign exchange transactions, imports-exports, remittances, charges and brokerage activities are recognised at the point in time when the transaction takes place. Other fee and commission expenses relate mainly to transaction and service fees, which are expensed as the services are received.

In the case of a contract with a customer that results in the recognition of a financial instrument in the Company's financial statements which may be partially in the scope of IFRS 9 and partially in the scope of IFRS 15, the Company first applies IFRS 9 to separate and measure the part of the contract that is in the scope of IFRS 9 and subsequently applies IFRS 15 to the residual part.

2.2.6 Property, equipment and Investment property

(i) Property and equipment

Property and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. Subsequent expenditure is recognized in the asset's carrying amount only when it is probable that future economic benefits will flow to the Company and the cost of the asset can be measured reliably. All other repair and maintenance costs are recognized in the income statement as incurred.

Depreciation is calculated using the straight-line method to write down the cost of property and equipment, to their residual values over their estimated useful life as follows:

Land: no depreciation;
Freehold buildings: 40-50 years;
Leasehold improvements: over the lease term or the useful life of the asset if shorter;
Computer hardware and related integral software: 4-10 years;
Other furniture and equipment: 4-20 years; and
Motor vehicles: 5-7 years.

(ii) Investment property

Property held for rental yields and/or capital appreciation that is not occupied by the Company's entities is classified as investment property.

Subsequent expenditure is charged to the asset's carrying amount only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. Repairs and maintenance costs are recognized to the income statement during the financial period in which they are incurred.

If an investment property becomes owner-occupied, it is reclassified as property and equipment and its fair value at the date of reclassification becomes its deemed cost. If an item of property and equipment becomes an investment property because its use has changed, any resulting decrease between the carrying amount and the fair value of thisitem at the date of transfer isrecognized in income statement while any resulting increase, to the extent that the increase reverses previous impairment loss for that property, is recognized in income statement while any remaining part of the increase is recognized in other comprehensive income and increases the revaluation surplus within equity.

If a repossessed asset becomes investment property, any difference between the fair value of the property at the date of transfer and its previous carrying amount is recognized in income statement.

Reclassifications among own used, repossessed assets and investment properties may occur when there is a change in the use of such properties. Additionally, an investment property may be reclassified to 'non-current assets held for sale' category to the extent that the criteria described in note 2.2.25 are met.

2.2.7 Intangible assets

(i) Goodwill

Goodwill arising on legal mergers that involve the absorption of an entity by the Company, other than an entity under common control, represents the excess of the aggregate of the fair value of the consideration transferred and the acquisition date fair value of any previously held equity interest in the acquiree over the fair value of the Company's share of net identifiable assets and contingent liabilities acquired. Goodwill arising is included in 'intangible assets' and is measured at cost less accumulated impairment losses.

(ii) Computer software

Costs associated with the maintenance of existing computer software programs are expensed as incurred. Development costs associated with the production of identifiable assets controlled by the Company are recognized as intangible assets when they are expected to generate economic benefits and can be measured reliably. Internally generated computer software assets are amortized using the straight-line method over 4 years, except for core systems whose useful life may extend up to 20 years.

(iii) Other intangible assets

Intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment.

2.2.8 Impairment of subsidiaries, associates and joint ventures

The Company assesses as at each reporting balance sheet date whether there is any indication that its investments in subsidiaries, associates and joint ventures may be impaired by considering both external and internal sources of information, such as the net assets compared to the carrying value of each entity, as well as forward looking developments and/or economy sector in which they operate. In addition, the collection of dividends from subsidiaries, associates and joint ventures is also a potential trigger for impairment may indicate that the respective investments are impaired.

If any such indication of impairment exists at each reporting date, the Company estimates the recoverable amount of the investment, being the higher of its fair value less costs to sell and its value in use.

An impairment loss is recognized in profit or loss when the recoverable amount of the investment is less than its carrying amount.

Investments in subsidiaries, associates and joint ventures, for which an impairment loss was recognized in prior reporting periods, are reviewed for possible reversal of such impairment at each reporting date.

2.2.9 Impairment of non-financial assets

(i) Goodwill

Goodwill arising on legal mergers that involve the absorption of an entity by the Company, other than an entity under common control, is not amortized but tested for impairment annually or more frequently if there are any indications that impairment may have occurred. The Company's impairment test is performed each year end. The Company considers external information such as prevailing economic conditions, persistent slowdown in financial markets, volatility in markets and changes in levels of market and exchange risk, an unexpected decline in an asset's market value or market capitalization being below the book value of equity, together with a deterioration in internal performance indicators, in assessing whether there is any indication of impairment.

For the purpose of impairment testing, goodwill acquired is allocated to each Cash Generating Unit (CGU) or groups of CGUs that are expected to benefit from the synergies of the merger. Each unit or group of units to which the goodwill is allocated represents the lowest level within the Company at which goodwill is monitored for internal management purposes. The Company monitors goodwill either at the separate CGU or group of CGUs consistent with the internal monitoring of operating segments.

The Company impairment model compares the carrying value of a CGU or group of CGUs with its recoverable amount. The carrying value of a CGU is based on the assets and liabilities of each CGU. The recoverable amount is determined on the basis of the valuein-use which is the present value of the future cash flows expected to be derived from the CGU or group of CGUs. The estimated

future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU and the countries where the CGUs operate.

An impairment loss arisesif the carrying amount of an asset or CGU exceedsitsrecoverable amount, and isrecognized in the income statement. Impairment losses are not subsequently reversed. Gains and losses on the disposal of an operation within that CGU include the carrying amount of goodwill relating to the operation disposed of.

(ii) Other non-financial assets

Other non-financial assets, including property and equipment and other intangible assets, are assessed for indications of impairment at each reporting date by considering both external and internal sources of information such as a significant reduction in the asset's value and evidence that the economic performance of the asset is or will be worse than expected. When events or changes in circumstances indicate that the carrying amount may not be recoverable, an impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows, where applicable. Non-financial assets, other than goodwill, for which an impairment loss was recognized in prior reporting periods, are reviewed for possible reversal of such impairment at each reporting date.

2.2.10 Financial assets

Financial assets - Classification and measurement

The Company classifies financial assets based on the business model for managing those assets and their contractual cash flow characteristics. Accordingly, financial assets are classified into one of the following measurement categories: amortized cost, fair value through other comprehensive income or fair value through profit or loss.

Purchases and sales of financial assets are recognized on trade date, which is the date the Company commits to purchase or sell the assets. Loans originated by the Company are recognized when cash is advanced to the borrowers.

Financial Assets measured at Amortized Cost ('AC')

The Company classifies and measures a financial asset at AC only if both of the following conditions are met and is not designated as at FVTPL:

(a) The financial asset is held within a business model whose objective is to collect contractual cash flows (hold-to-collect business model) and

(b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (SPPI).

Interest income, realized gains and losses on derecognition, and changes in expected credit losses from assets classified at AC, are included in the income statement.

Financial Assets measured at Fair Value through Other Comprehensive Income ('FVOCI')

The Company classifies and measures a financial asset at FVOCI only if both of the following conditions are met and is not designated as at FVTPL:

(b) The contractual terms of the financial asset give rise on specified dates to cash flows that are SPPI.

Financial assets that meet these criteria are debt instruments and are measured initially at fair value, plus direct and incremental transaction costs.

Equity Instruments designated at FVOCI

The Company may make an irrevocable election to designate an equity instrument at FVOCI. This designation, if elected, is made at initial recognition and on an instrument by instrument basis. Gains and losses on these instruments, including when derecognized, are recorded in OCI and are not subsequently reclassified to the income statement. Dividends received are recorded in the income statement.

Financial Assets measured at Fair Value through Profit and Loss ("FVTPL")

The Company classifies and measures all other financial assets that are not classified at AC or FVOCI, at FVTPL. Accordingly, this measurement category includes debt instruments such as loans and debt securities that are held within the hold–to-collect (HTC) or hold-to-collect-and-sell models(HTCS), but fail the SPPI assessment, equitiesthat are not designated at FVOCI and financial assets held for trading. Derivative financial instruments are measured at FVTPL, unless they are designated and effective hedging instruments, in which case hedge accounting requirements under IAS 39 continue to apply.

Furthermore, a financial asset that meets the above conditions to be classified at AC or FVOCI, may be irrevocably designated by the Company at FVTPL at initial recognition, if doing so eliminates, or significantly reduces an accounting mismatch that would otherwise arise.

Financial assets measured at FVTPL are initially recorded at fair value and any unrealized gains or losses arising due to changes in fair value are included in the income statement.

Business model and contractual characteristics assessment

The business model assessment determines how the Company manages a group of assets to generate cash flows. That is, whether the Company's objective is solely to collect contractual cash flows from the asset, to realize cash flows from the sale of assets, or both to collect contractual cash flows and cash flows from the sale of assets. In addition, the business model is determined after aggregating the financial assets into groups (business lines) which are managed similarly rather than at an individual instrument's level.

The business model is determined by the Company's key management personnel consistently with the operating model, considering how financial assets are managed in order to generate cash flows, the objectives and how performance of each portfolio is monitored and reported and any available information on past sales and on future sales' strategy, where applicable.

Accordingly, in making the above assessment, the Company will consider a number of factors including the risks associated with the performance of the business model and how those risks are evaluated and managed, the related personnel compensation, and the frequency, volume and reasons of past sales, as well as expectations about future sales activity.

Types of business models

The Company's business models fall into three categories, which are indicative of the key strategies used to generate returns.

The hold-to-collect (HTC) business model has the objective to hold the financial assets in order to collect contractual cash flows. Sales within this model are monitored and may be performed for reasons which are not inconsistent with this business model. More specifically, sales of financial assets due to credit deterioration, as well as, sales close to the maturity are considered consistent with the objective of hold-to-collect contractual cash flows regardless of value and frequency. Sales for other reasons may be consistent with the HTC model such as liquidity needs in any stress case scenario or sales made to manage high concentration level of credit risk. Such sales are monitored and assessed depending on frequency and value to conclude whether they are consistent with the HTC model. Debt instruments classified within this business model include bonds, due from banks and loans and advances to customers including securitized notes issued by special purpose vehicles established by the Company and recognized in its balance sheet, which are measured at amortized cost, subject to meeting the SPPI assessment criteria.

The Company's business models are reassessed at least annually or earlier, if there is a sales' assessment trigger or if there are any changes in the Company's strategy and main activities, as evidenced by the Company's business plan, budget and NPE strategy.

Cash flow characteristics assessment

In assessing whether the contractual cash flows are SPPI, the Company will consider whether the contractual terms of the instrument are consistent with a basic lending arrangement i.e. interest includes only consideration for the time value of money, credit risk, other basic lending risks and a profit margin. On the initial recognition of a financial asset, an assessment is performed of whether the financial asset contains a contractual term that could change the amount or timing of contractual cash flows in a way that it would not be consistent with the above condition. Where the contractual terms introduce exposure to risk or volatility that are inconsistent with a basic lending arrangement, the related financial asset is considered to have failed the SPPI assessment and will be measured at FVTPL.

For the purpose of the SPPI assessment, the Company considers the existence of various features, including among others, contractually linked terms, prepayment terms, deferred interest-free payments, extension and equity conversion options and terms that introduce leverage including index linked payments. Moreover, for the securitized notes issued by special purpose vehicles and held by the Company, the cash flow characteristics of the underlying pool of financial assets as well as the credit risk inherent in each securitization's tranche compared to the credit risk of all of the underlying pool of financial assets, are considered.

In case of special lending arrangements such as non-recourse loans, in its assessment of the SPPI criterion, the Company considers various factors such as the nature of the borrower and its business, the pricing of the loans, whether it participates in the economic performance of the underlying asset and the extent to which the collateral represents all or a substantial portion of the borrower's assets. Moreover, for special purpose entities, the Company takes into consideration the borrower's adequacy of loss absorbing capital by assessing jointly the criteria of equity sufficiency, Loan to Value ratio (LTV), the Average Debt Service Coverage ratio (ADSCR) as well as the existence of corporate and personal guarantees.

In certain cases when the time value of money element is modified in that the financial asset's interest rate is periodically reset but the reset frequency does not match the tenor of the interest rate or when a financial asset's interest rate is periodically reset to an average of particular short-term and long-term interest rates, a quantitative assessment is performed (the "Benchmark Test") in order to determine whether the contractual cash flows are SPPI.

In particular, the Company assessesthe contractual cash flows of the "real instrument", whose interest rate isreset with a frequency that does not match the tenor of the interest rate, and those of the "benchmark instrument", which are identical in all respects except that the tenor of the interest rate matches exactly the interest period. If the undiscounted cash flows of the former are significantly different from the benchmark cash flows due to the modified time value of money element, the financial asset does not meet the SPPI criterion. In its assessment, the Company considers both the effect of the modified time value of money element in each reporting period and cumulatively over the life of the instrument. This is done, as far as the lifetime of the instrument is concerned, by comparing the cumulative projected undiscounted cash flows of the real and the benchmark instrument, and for each quarterly reporting period, by comparing the projected undiscounted cash flows of the two instruments for that quarterly reporting period, based on predefined thresholds.

In addition, for the purposes of the SPPI assessment, if a contractual feature could have an effect that is de-minimis on the contractual cash flows of the financial asset, it does not affect its classification. Moreover, a contractual feature is considered as not genuine by the Company, if it affects the instrument's contractual cash flows only on the occurrence of an event that is extremely rare, highly abnormal and very unlikely to occur. In such a case, it does not affect the instrument's classification.

The Company performs the SPPI assessment for its lending exposures on a product basis for the retail and part of the wholesale portfolio where contracts are of standardized form, whereas for the remaining wholesale portfolio, securitized notes issued by special purpose vehicles established by the Company and debt securities the assessment is performed on an individual basis.

Derecognition of financial assets

The Company derecognizes a financial asset when its contractual cash flows expire, or the rights to receive those cash flows are transferred in an outrightsale in which substantially all risks and rewards of ownership have been transferred. In addition, a financial asset is derecognized even if rights to receive cash flows are retained but at the same time the Company assumes an obligation to pay the received cash flows without a material delay (pass through agreement) or when substantially all the risks and rewards are neither transferred nor retained but the Company has transferred control of the asset. Control is transferred if, and only if, the transferee has the practical ability to sell the asset in its entirety to unrelated third party and is able to exercise that ability unilaterally and without imposing additional restrictions on the transfer.

The main transactions that are subject to the above de-recognition rules are securitization transactions, repurchase agreements and stock lending transactions. In the case of securitization transactions, in order to assess the application of the above mentioned de-recognition principles, the Company considersthe structure of each securitization transaction including its exposure to the more subordinated tranches of the notes issued and/or credit enhancements provided to the special purposes vehicles, as well as the securitization's contractual terms that may indicate that the Company retains control of the underlying assets. In the case of repurchase transactions and stock lending, the assets transferred are not derecognised since the terms of the transaction entail the retention of all their risks and rewards.

Modification of financial assets that may result in derecognition

In addition, derecognition of financial asset arises when its contractual cash flows are modified and the modification is considered substantial enough so that the original asset is derecognized and a new one is recognised. The Company records the modified asset as a 'new' financial asset at fair value and the difference with the carrying amount of the existing one is recorded in the income statement as derecognition gain or loss.

The Company may modify the contractual terms of a lending exposure either as a concession granted to a client facing or that is about to face financial difficulties or due to other commercial reasons such as changes in market conditions, competition or customer retention.

Modifications that may result in derecognition include:

change in borrower,
change in the currency that the lending exposure is denominated,
debt consolidation features where two or more consumer unsecured lending contracts are consolidated into a single new secured lending agreement,
the removal or addition of conversion features and/or profit sharing mechanisms and similar terms which are relevant to the SPPI assessment;

In addition, the Company may occasionally enter, in the context of loans' modifications, into debt-for-equity transactions. These are transactions where the terms of a lending exposure are renegotiated and as a result, the borrower issues equity instruments (voting or no voting) in order to extinguish part or all of its financial liability to the Company. Such transactions may include also exercise of conversion rights embedded into convertible or exchangeable bonds and enforcement of shares held as collateral.

In debt-for-equity transactions, the modified loan is derecognized while the equity instrumentsreceived in exchange are recognized at their fair value, with any resulting gain or loss recognized in the Company's income statement.

2.2.11 Reclassifications of financial assets

The Company reclassifies a financial asset only when it changesits business model for managing financial assets. Generally, a change in the business model is expected to be rare and occurs when the Company either begins or ceases to perform an activity that is significant to its operations; for example, when a business line is acquired, disposed of or terminated. In the rare event when there is a change to the existing business models, the updated assessment is approved by the Company's competent Committees and the amendment is reflected appropriately in the Company's budget and business plan.

Changes in intention related to particular financial assets (even in circumstances of significant changes in market conditions), the temporary disappearance of a particular market for financial assets or a transfer of financial assets between parts of the Company with different business models, are not considered by the Company changes in business model.

The reclassification is applied prospectively from the reclassification date, therefore previously recognized gains, losses (including impairment losses) or interest are not restated.

2.2.12 Financial liabilities

Financial liabilities - Classification and measurement

The Company classifiesitsfinancial liabilitiesin the following categories: financial liabilities measured at amortized cost and financial liabilities measured at fair-value-through-profit-or-loss.

Financial liabilities held for trading are those liabilities that the Company incurs principally for the purpose of repurchasing in the near term for short term profit.

The Company may, at initial recognition, irrevocably designate financial liabilities at fair-value-through-profit-or-loss when one of the following criteria is met:

the designation eliminates orsignificantly reduces an accounting mismatch which would otherwise arise from measuring assets or liabilities or recognising the gains and losses on them on different bases; or
a group of financial liabilities or financial assets and financial liabilities is managed and its performance is evaluated on a fair value basis in accordance with a documented risk management or investment strategy; or
the financial liability contains one or more embedded derivatives as components of a hybrid contract which significantly modify the cash flows that otherwise would be required by the contract.

Financial liabilities designated at FVTPL are initially recognized at fair value. Changes in fair value are recognized in the income statement, except for changes in fair value attributable to changes in the Company's own credit risk, which are recognised in OCI and are not subsequently reclassified to the income statement upon derecognition of the liabilities. However, if such treatment creates or enlarges an accounting mismatch in the income statement, all gains or losses of thisfinancial liability, including the effects of changes in the credit risk, are recognized in the income statement.

Derecognition of financial liabilities

A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires. When an existing financial liability of the Company is replaced by another from the same counterparty on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as an extinguishment of the original liability and the recognition of a new liability and any difference arising is recognized in the income statement.

The Company considers the terms to be substantially different, if the discounted present value of the cash flows under the new terms, including any fees paid net of any fees received and discounted using the original effective interest rate, is at least 10% different from the discounted present value of the remaining cash flows of the original financial liability.

If an exchange of debt instruments or modification of terms is accounted for as an extinguishment, any costs or fees incurred are recognized as part of the gain or loss on the extinguishment. If the exchange or modification is not accounted for as an extinguishment, any costs or fees incurred adjust the carrying amount of the liability and are amortized over the remaining term of the modified liability.

Similarly, when the Company repurchases any debt instruments issued by the Company, it accounts for such transactions as an extinguishment of debt.

2.2.13 Fair value measurement of financial instruments

Fair value of financial instruments is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions in the principal or, in its absence, the most advantageous market to which the Company has access at that date. The fair value of a liability reflects its nonperformance risk.

When available, the Company measures the fair value of an instrument using the quoted price in an active market for that instrument. A market is regarded as active if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. If there is no quoted price in an active market, then the Company uses other valuation techniques that maximize the use of relevant observable inputs and minimize the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction.

The Company has elected to use mid-market pricing as a practical expedient for fair value measurements within a bid-ask spread.

unobservable inputs, the financial instrument is initially measured at fair value, adjusted to defer the difference between the fair value at initial recognition and the transaction price (day one gain or loss). Subsequently the deferred gain or loss is amortized on an appropriate basis over the life of the instrument or released earlier if a quoted price in an active market or observable market data become available or the financial instrument is closed out.

For assets and liabilities that are measured at fair value on a recurring basis, the Company recognizes transfers into and out of the fair value hierarchy levels at the beginning of the quarter in which a financial instrument's transfer was effected.

2.2.14 Impairment of financial assets

The Company recognizes allowance for expected credit losses (ECL) that reflect changes in credit quality since initial recognition to financial assets that are measured at AC and FVOCI, including loans, securitized notes issued by special purpose vehicles established by the Company, lease receivables, debt securities, financial guarantee contracts, and loan commitments. No ECL are recognized on equity investments. ECL are a probability-weighted average estimate of credit losses that reflects the time value of money. Upon initial recognition of the financial instruments in scope of the impairment policy, the Company records a loss allowance equal to 12 month ECL, being the ECL that result from default events that are possible within the next twelve months. Subsequently, for those financial instrumentsthat have experienced a significant increase in credit risk (SICR)since initial recognition, a loss allowance equal to lifetime ECL is recognized, arising from default events that are possible over the expected life of the instrument. If upon initial recognition, the financial asset meets the definition of purchased or originated credit impaired (POCI), the loss allowance is based on the change in the ECL over the life of the asset.

Loss allowances for trade receivables are always measured at an amount equal to lifetime ECL. For all other financial assets subject to impairment, the general three-stage approach applies.

Accordingly, ECL are recognized using a three-stage approach based on the extent of credit deterioration since origination:

Stage 1 When there is no significant increase in credit risk since initial recognition of a financial instrument, an amount equal to 12-months ECL is recorded. The 12 – month ECL represent a portion of lifetime losses, that result from default events that are possible within the next 12 months after the reporting date and is equal to the expected cash shortfalls over the life of the instrument or group of instruments, due to loss events probable within the next 12 months. Not credit-impaired financial assets that are either newly originated or purchased, as well as, assets recognized following a substantial modification accounted for as a derecognition, are classified initially in Stage 1.
Stage 2 When a financial instrument experiences a SICR subsequent to origination but is not considered to be in default, it is included in Stage 2. Lifetime ECL represent the expected credit losses that result from all possible default events over the expected life of the financial instrument.
Stage 3 Financial instruments that are considered to be in default are included in this stage. Similar to Stage 2, the allowance for credit losses captures the lifetime expected credit losses.
POCI Purchased or originated credit impaired (POCI) assets are financial assets that are credit impaired on initial recognition. They are not subject to stage allocation and are always measured on the basis of lifetime expected credit losses. Accordingly, ECL are only recognized to the extent that there is a subsequent change in the assets' lifetime expected credit losses. Any subsequent favorable change to their expected cash flows is recognized as impairment gain in the income statement even if the resulting expected cash flows exceed the estimated cash flows at initial recognition. Apart from purchased assets, POCI assets may also include financial instruments that are considered new assets, following a substantial modification accounted for as a derecognition (see note 2.2.10).

Definition of default

To determine the risk of default, the Company applies a default definition for accounting purposes, which is consistent with the European Banking Authority (EBA) definition for non-performing exposure. The accounting definition of default is consistent with the one used for internal credit risk management purposes.

A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that exposure have occurred:

The borrower faces a significant difficulty in meeting his financial obligations.
There has been a breach of contract, such as a default or past due event.

The Company, for economic or contractual reasons relating to the borrower's financial difficulty, has granted to the borrower a concession(s) that the Company would not otherwise consider.
There is a probability that the borrower will enter bankruptcy or other financial re-organization.
For POCI financial assets, a purchase or origination at a deep discount that reflects incurred credit losses is considered a detrimental event. The Company assesses the deep discount criterion following a principle -based approach with the aim to incorporate all reasonable and supportable information which reflects market conditions that exist at the time of the assessment.

For debt securities, the Company determines the risk of default using an internal credit rating scale. The Company considers debt securities as credit impaired if the internal rating of the issuer/counterparty corresponds to a rating equivalent to "C" (Moody's rating scale) or the external rating of the issuer/counterparty at the reporting date is equivalent to "C" (Moody's rating scale) and the internal rating is not available.

Significant increase in credit risk (SICR) and staging allocation

At each reporting date, the Company performs an assessment as to whether the risk of a default occurring over the remaining expected lifetime of the exposure has increased significantly from the expected risk of a default estimated at origination for that point in time.

As a primary criterion for SICR assessment, the Company comparesthe residual lifetime probability of default (PD) at each reporting date to the residual lifetime PD for the same point in time which was expected at the origination.

The Company may also consider as a SICR indicator when the residual lifetime PD at each reporting date exceeds certain predetermined values. The criterion may be applied in order to capture cases where the relative PD comparison does not result to the identification of SICR although the absolute value of PD is at levels which are considered high based on the Company's risk appetite framework.

Internal credit risk rating (on a borrower basis) is also used as a basis for the identification of SICR with regards to lending exposures of the Wholesale portfolio. Specifically, the Company takes into consideration the changes of internal ratings by a certain number of notches. In addition, a watchlist status is also considered by the Company as a trigger for SICR identification. Internal credit risk ratings models include borrower specific information as well as, forward-looking information including macroeconomic variables.

Assessment of SICR for debtsecuritiesis performed on an individual basis based on the number of notches downgrade in the internal credit rating scale since the origination date.

Forbearance measures as monitored by the Company are considered as a SICR indicator and thus the exposures are allocated into Stage 2 upon forbearance, unless they are considered credit-impaired in which case they are classified as stage 3. Furthermore, regardless of the outcome of the SICR assessment based on the above indicators, the credit risk of a financial asset is deemed to have increased significantly when contractual payments are more than 30 days past due.

Transfers from Stage 2 to Stage 1

A financial asset, which is classified to Stage 2 due to Significant Increase in Credit Risk (SICR), is reclassified to Stage 1, as long as it does not meet anymore any of the Stage 2 Criteria.

Where forbearance measures have been applied, the Company uses a probation period of two years, in order to fulfill the requirements for a transfer back to Stage 1. If at the end of that period the borrowers have made regular payments of a significant aggregate amount, there are no past due amounts over 30 days and the loans are neither credit impaired, nor any other SICR criteria are met, they exit forborne status and are classified as stage 1.

Transfers from Stage 3 to Stage 2

A financial asset is transferred from Stage 3 to Stage 2, when the criteria based on which the financial asset was characterized as credit impaired, are no longer valid.

Criteria for grouping of exposures based on shared credit risk characteristics

The assessment of loss allowance is performed either on an individual basis or on a collective basis for groups of similar items with homogeneous credit risk characteristics. The Company applies the same principles for assessing SICR since initial recognition when estimating ECL on a collective or on an individual basis.

The Company segments its lending exposures on the basis of shared credit risk characteristics for the purposes of both assessing significant increase in credit risk and measuring loan loss allowance on a collective basis. The different segments aim to capture differences in PDs and in the rates of recovery in the event of default.

The Company identifies individually significant exposures and performs the ECL measurement based on borrower specific information for both retail and wholesale portfolios. This measurement is performed at a borrower level, hence the criteria are defined at this level, while both qualitative and quantitative factors are taken into consideration including forward looking information.

For the remaining retail and wholesale exposures, ECL are measured on a collective basis. This incorporates borrower specific information, collective historical experience of losses and forward-looking information. For debt securities and securitized notes issued by special purpose entities established by the Company,the measurement of impairment lossesis performed on an individual basis.

Measurement of Expected Credit Losses

The measurement of ECL is an unbiased probability-weighted average estimate of credit lossesthatreflectsthe time value of money, determined by evaluating a range of possible outcomes. A credit loss is the difference between the cash flows that are due to the Company in accordance with the contractual terms of the instrument and the cash flows that the Company expects to receive (i.e. cash shortfalls) discounted at the original effective interest rate (EIR) of the same instrument, or the credit-adjusted EIR in case of purchased or originated credit impaired assets (POCI). In measuring ECL, information about past events, current conditions and reasonable and supportable forecasts of future conditions are considered. For undrawn commitments, ECL are calculated as the present value of the difference between the contractual cash flows due if the commitment was drawn and the cash flows expected to be received, while for financial guarantees ECL are measured asthe expected paymentsto reimburse the holder less any amounts that the Company expects to receive.

The Company estimates expected cash shortfalls, which reflect the cash flows expected from all possible sources, including collateral, guarantees and other credit enhancements that are part of the contractual terms and are not recognized separately. In case of a collateralized financial instrument, the estimated expected cash flows related to the collateral reflect the amount and timing of cash flows that are expected from liquidation less the discounted costs of obtaining and selling the collateral, irrespective of whether liquidation is probable.

ECL are calculated over the maximum contractual period over which the Company is exposed to credit risk, which is determined based on the substantive terms of the instrument, or in case of revolving credit facilities, by taking into consideration factors such as the Company's expected credit risk management actions to mitigate credit risk and past practice.

Receivables from customers arising from the Company's activities other than lending, are presented under Other Assets and are typically short term. Therefore, considering that usually there is no significant financing component, the loss allowance for such financial assets is measured at an amount equal to the lifetime expected credit losses under the simplified approach.

ECL Key Inputs

The ECL calculations are based on the term structures of the probability of default (PD), the loss given default (LGD), the exposure at default (EAD) and other input parameters such as the credit conversion factor (CCF) and the prepayment rate. Generally, the Company derives these parameters from internally developed statistical models and observed point-in-time and historical data, leveraging the existing infrastructure development for the regulatory framework and risk management practices.

The Company uses Point in Time (PiT) PDs in order to remove any bias towards historical data thus aiming to reflect management's view of the future as at the reporting date, incorporating relevant forward looking information including macroeconomic scenarios.

Two types of PD are used for calculating ECL:

12-month PD, which is the estimated probability of default occurring within the next 12 months (or over the remaining life of the financial asset if this is less than 12 months). It is used to calculate 12-month ECL for Stage 1 exposures.
Lifetime PD, which is the estimated probability of a default occurring over the remaining life of the financial asset. It is used to calculate lifetime ECL for Stage 2, Stage 3 and POCI exposures.

For debt securities, PDs are obtained by an international rating agency using risk methodologies that maximize the use of objective non-judgmental variables and market data. The Company assigns internal credit ratings to each issuer/counterparty based on these PDs. In case of counterparties for which no information is available, the Company assigns PDs which are derived from internal models.

In addition, the prepayment rate is an estimate of early prepayments on loan exposure in excess of the contractual repayment according to the repaymentschedule and is expressed as a percentage applied to the EAD at each period,reducing the latter amount accordingly.

LGD represents the Company's expectation of the extent of loss on a defaulted exposure and it is the difference between the contractual cash flows due and those that the Company expects to receive including any amounts from collateral liquidation. LGD varies by type of counterparty, type and seniority of claim, availability of collateral or other credit support, and is usually expressed as a percentage of EAD. The Company distinguishes its loan portfolios into two broad categories i.e. secured and unsecured. The Company estimates the LGD component using cure rates that reflect cash recoveries, estimated proceeds from collateral liquidation, estimates for timing realization, realization costs, etc. Where the LGD's component values are dependent on macro – economic data, such types of dependencies are reflected by incorporating forward looking information, such as forecasted price indices into the respective models. The estimation of the aforementioned component values within LGD reflects available historical data which cover a reasonable period, i.e. a full economic cycle.

Furthermore, the seniority of the debt security, any potential collaterals by the obligor or any other type of coverage is taken into account for the calculation.

Forward-looking information

The Company uses, at a minimum, three macroeconomic scenarios (i.e. base, adverse and optimistic) to achieve the objective of measuring ECL in a way that reflects an unbiased and probability weighted outcome. The baseline scenario represents the most likely scenario and is aligned with the information used by the Company for strategic planning and budgeting purposes.

The scenarios are reflected in the risk parameters, and, namely 12-month PD, Lifetime PD and LGD, hence 3 sets of each of these parameters are used, in line with the scenarios developed.

The Company then proceeds to the calculation of weights for each scenario, which represent the probability of occurrence for each of these scenarios. These weights are applied on the 3 sets of calculations of the parameters in order to produce a single scenario weighted risk parameter value which is subsequently used in both SICR assessment and ECL measurement. ECL calculation incorporates forward-looking macroeconomic variables, including GDP growth rates, house price indices, unemployment rates, interest rates, etc. In order to capture material non – linearities in the ECL model, in the case of individually significant exposures, the Company considers the relevance of forward looking information to each specific group of borrowers primarily on the basis of the business sector they belong and other drivers of credit risk (if any). As such, different scenario weights are determined per groups of borrowers with the objective of achieving an unbiased ECL amount which incorporates all relevant and supportable information.

Modified Financial Assets

In cases where the contractual cash flows of a financial asset have been modified and the modification is considered substantial enough (for the triggers of derecognition, refer to Derecognition of Financial assets in section 2.2.10 above), the modification date is considered to be the date of initial recognition for impairment calculation purposes, including for the purposes of determining whether a significant increase in credit risk has occurred. Such a modified asset istypically classified as Stage 1 for ECL measurement purposes. However, in some circumstances following a modification that results in derecognition of the original financial asset, there may be evidence that the new financial asset is credit-impaired at initial recognition, and thus, the financial asset isrecognized as an originated credit-impaired financial asset (POCI).

In cases where the contractual cash flows of a financial asset have been modified and the modification is not considered substantial enough, the Company recalculates the gross carrying amount of the financial asset and recognizes the difference as a modification gain or loss in the income statement and determines if the financial asset's credit risk has increased significantly since initial recognition by comparing the risk of a default occurring at initial recognition based on the original unmodified contractual terms and the risk of a default occurring at the reporting date, based on the modified contractual terms.

Presentation of impairment allowance

For financial assets measured at amortized cost, impairment allowance is recognized as a loss allowance reducing the gross carrying amount of the financial assets in the balance sheet. For debt instruments measured at FVOCI, impairment allowance is recognized in other comprehensive income and does not reduce the carrying amount of the debt instruments in the balance sheet. For offbalance sheet financial items arising from lending activities, impairment allowance is presented in Other Liabilities. The respective ECL for the above financial items is recognised within impairment losses.

Write-off of financial assets

Where the Company has no reasonable expectations of recovering a financial asset either in its entirety or a portion of it, the gross carrying amount of that instrument is reduced directly, partially or in full, against the impairment allowance. The amount writtenoff is considered as derecognized. Subsequent recoveries of amounts previously written off decrease the amount of the impairment losses in the income statement.

Financial assets that are written off could still be subject to enforcement activities in order to comply with the Company's procedures for recovery of amounts due.

2.2.15 Sale and repurchase agreements and securities lending

(i) Sale and repurchase agreements

Securities sold subject to repurchase agreements (repos) continue to be recorded in the Company's Balance Sheet as the Company retains substantially all risks and rewards of ownership, while the counterparty liability is included in amounts due to other banks or due to customers, as appropriate. Securities purchased under agreements to resell (reverse repos) are recorded as loans and advances to other banks or customers, as appropriate. The difference between the sale and repurchase price in case of repos and the purchase and resale price in case of reverse repos is recognized as interest and accrued over the period of the repo or reverse repo agreements using the effective interest method.

(ii) Securities lending

2.2.16 Leases

(i) Accounting for leases as lessee

When the Company becomesthe lessee in a lease arrangement, it recognizes a lease liability and a corresponding right-of-use (RoU) asset at the commencement of the lease term when the Company acquires control of the physical use of the asset.

The lease liability is remeasured when there is a change in future lease payments arising from a change in an index or rate, a change in the Company's estimate of the amount expected to be payable under a residual value guarantee or if the Company changes its assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

When a lease contains extension or termination options that the Company considers reasonably certain to be exercised, the expected future lease payments or costs of early termination are included within the lease payments used to calculate the lease liability.

(ii) Accounting for leases as lessor

At inception date of the lease, the Company, acting as a lessor, classifies each of its leases as either an operating lease or a finance lease based on certain criteria.

Finance leases

At commencement date, the Company derecognizes the carrying amount of the underlying assets held under finance lease, recognizes a receivable at an amount equal to the net investment in the lease and recognizes, in income statement, any profit or loss from the derecognition of the asset and the recognition of the net investment. The net investment in the lease is calculated as the present value of the future lease payments in the same way as for the lessee.

After commencement date, the Company recognizes finance income over the lease term, based on a pattern reflecting a constant periodic rate of return on the lessor's net investment in the lease. The Company also recognizes income from variable payments that are not included in the net investment in the lease. After lease commencement, the net investment in a lease is notremeasured unless the lease is modified or the lease term is revised.

Operating leases

The Company continues to recognize the underlying asset and does not recognize a net investment in the lease on the balance sheet or initial profit (if any) on the income statement.

The Company recognizes lease payments from the lessees as income on a straight-line basis or another systematic basis considered as appropriate. Also it recognizes costs, including depreciation, incurred in earning the lease income as an expense. The Company addsinitial direct costs incurred in obtaining an operating lease to the carrying amount of the underlying asset and recognizes those costs as an expense over the lease term on the same basis as the lease income.

Subleases

The Company, acting as a lessee, may enter into arrangements to sublease a leased asset to a third party while the original lease contract is in effect. The Company acts as both the lessee and lessor of the same underlying asset. The sublease is a separate lease agreement, in which the intermediate lessor classifies the sublease as a finance lease or an operating lease as follows:

if the head lease is a short-term lease, the sublease is classified as an operating lease; or
otherwise, the sublease is classified by reference to the right-of-use asset arising from the head lease, rather than by reference to the underlying asset.

2.2.17 Income tax

Income tax consists of current and deferred tax.

(i) Current income tax

Income tax payable on profits, based on the applicable tax law, is recognized as an expense in the period in which profits arise.

(ii) Deferred tax

Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date.

Deferred tax assets are recognized where it is probable that future taxable profit will be available against which the temporary differences can be utilized. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Any such reduction is reversed to the extent that it becomes probable that sufficient taxable profit will be available. The Company recognises a previously unrecognised deferred tax asset to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

The deferred tax asset on income tax losses carried forward is recognized as an asset when it is probable that future taxable profits will be available against which these losses can be utilized.

(iii) Uncertain tax positions

The Company determines and assesses all material tax positions taken, including all, if any, significant uncertain positions, in all tax yearsthat are stillsubject to assessment (or when the litigation isin progress) by relevant tax authorities. In evaluating tax positions, the Company examines all supporting evidence (Ministry of Finance circulars, individual rulings, case law, past administrative practices, ad hoc tax/legal opinions etc.) to the extent they are applicable to the facts and circumstances of the particular Company's case/ transaction.

In addition, judgments concerning the recognition of a provision against the possibility of losing some of the tax positions are highly dependent on advice received from internal/ external legal counselors. For uncertain tax positions with a high level of uncertainty, the Company recognizes, on a transaction by transaction basis, or together as a group, depending on which approach better predicts the resolution of the uncertainty using an expected value (probability-weighted average) approach: (a) a provision against tax receivable which has been booked for the amount of income tax already paid but further pursued in courts or (b) a liability for the amount which is expected to be paid to the tax authorities. The Company presents in its balance sheet all uncertain tax balances as current or deferred tax assets or liabilities.

The Company as a general rule has opted to obtain an 'Annual Tax Certificate', which is issued after a tax audit is performed by the same statutory auditor or audit firm that audits the annual financial statements. Further information in respect of the Annual Tax Certificate and the related tax legislation, is provided in note 10.

2.2.18 Employee benefits

(i) Short term benefits

(ii) Pension obligations

The Company provides a number of defined contribution pension plans where annual contributions are invested and allocated to specific asset categories. Eligible employees are entitled to the overall performance of the investment. The Company's contributions are recognized as employee benefit expense in the year in which they are paid.

(iii) Standard legal staff retirement indemnity obligations (SLSRI) and termination benefits

The Company operates unfunded defined benefit plans, under the regulatory framework. In accordance with the local labor legislation, the Company provides for staff retirement indemnity obligation for employees which are entitled to a lump sum payment based on the number of years of service and the level of remuneration at the date of retirement, if they remain in the employment of the Company until normal retirement age. Provision has been made for the actuarial value of the lump sum payable on retirement (SLSRI) using the projected unit credit method. Under this method the cost of providing retirement indemnities is charged to the income statement so as to spread the cost over the period of service of the employees, in accordance with the actuarial valuations which are performed every year.

The SLSRI obligation is calculated as the present value of the estimated future cash outflows using interest rates of high quality corporate bonds. The currency and term to maturity of the bonds used are consistent with the currency and estimated term of the retirement benefit obligations. Actuarial gains and losses that arise in calculating the Company's SLSRI obligations are recognized directly in other comprehensive income in the period in which they occur and are not reclassified to the income statement in subsequent periods.

Interest on the staff retirement indemnity obligations and service cost, consisting of current service cost, past service cost and gains or losses on settlement are recognized in the income statement. In calculating the SLSRI obligation, the Company also considers potential separations before normal retirement based on the terms of previous voluntary exit schemes.

Termination benefits are payable when employment isterminated by the Company before the normal retirement date, or whenever an employee accepts voluntary redundancy in exchange for these benefits (including those in the context of the Voluntary Exit Schemes implemented by the Company). The Company recognizes termination benefits at the earlier of the following dates: (a) when the Company can no longer withdraw the offer of those benefits; and (b) when the Company recognizes costs for a restructuring that involves the payment of termination benefits. In the case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer. Termination benefitsfalling due more than 12 months after the end of the reporting period are discounted to their present value.

(iv) Performance-based cash payments

The Company's Management awards high performing employees with bonuses in cash, from time to time, on a discretionary basis. Cash payments requiring only Management approval are recognized as employee benefit expenses on an accrual basis. Cash payments requiring General Meeting approval as distribution of profits to staff are recognized as employee benefit expense in the accounting period that they are approved by the Company's shareholders.

(v) Performance-based share-based payments

The Company's Management awards employees with bonuses in the form of shares and share options on a discretionary basis. Non-performance related shares vest in the period granted. Share based payments that are contingent upon the achievement of a performance and service condition, vest only if both conditions are satisfied.

The fair value of the shares granted is recognized as an employee benefit expense with a corresponding increase in share capital (par value) and share premium.

2.2.19 Repossessed properties

In cases where the Company makes use of repossessed properties as part of its operations, they may be reclassified to own occupied or investment properties, as appropriate.

Any gains or losses on liquidation are included in the income statement.

2.2.20 Related party transactions

Related parties of the Company include:

(a) an entity that has control over the Company and entities controlled, jointly controlled or significantly influenced by this entity, as well as members of its key management personnel and their close family members;

(b) an entity that has significant influence over the Company and entities controlled by this entity,

(c) members of key management personnel of the Company, their close family members and entities controlled or jointly controlled by the abovementioned persons;

(d) associates and joint ventures of the Company; and

(e) subsidiaries.

2.2.21 Provisions

Provisions are recognized when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and reliable estimates of the amount of the obligation can be made.

2.2.22 Share capital

Dividend distribution on shares is recognized as a deduction in the Company's equity when approved by the General Meeting of shareholders. Interim dividends are recognized as a deduction in the Company's equity when approved by the Board of Directors.

Where the Company purchases own shares (treasury shares), the consideration paid including any directly attributable incremental costs (net of income taxes), is deducted from shareholders' equity until the shares are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received is included in shareholders' equity.

2.2.23 Hybrid capital

Hybrid capital issued by the Company, through its special purpose entity, is classified as equity when there is no contractual obligation to deliver to the holder cash or another financial asset. Incremental costs directly attributable to the issue of new hybrid capital are shown in equity as a deduction from the proceeds, net of tax.

Dividend distribution on hybrid capital is recognized as a deduction in the Company's equity on the date it is due.

Where hybrid capital, issued by the Company, isrepurchased, the consideration paid including any directly attributable incremental costs (net of income taxes), is deducted from shareholders' equity. Where such securities are subsequently called or sold, any consideration received is included in shareholders' equity.

2.2.24 Financial guarantees and commitments to extend credit

Financial guarantees

Financial guarantee contracts are contracts that require the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due, in accordance with the terms of a debt instrument. Such financial guarantees are granted to banks, financial institutions and other bodies on behalf of customers to secure loans, overdrafts and other banking facilities.

Commitments to extend credit

Commitments represent off-balance sheet items where the Company commits, over the duration of the agreement, to provide a loan with pre-specified termsto the customer. Such contractual commitmentsrepresent commitmentsto extend credit and standby letters and they are part of the normal lending activities of the Company, for which an ECL allowance is recognised under IFRS 9.

ECL allowance for off-balance sheet exposures (financial guarantees and commitments) is included within Other Liabilities.

2.2.25 Non-current assets classified as held for sale and discontinued operations

Non-current assets are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. For a non- current asset to be classified as held for sale, it is available for immediate sale in its present condition, subject to terms that are usual and customary for sales of such assets, and the sale is considered to be highly probable. In such cases, management is committed to the sale and actively markets the property for sale at a price that is reasonable in relation to the current fair value. The sale is also expected to qualify for recognition as a completed sale within one year from the date of classification. Before their classification as held for sale, assets are remeasured in accordance with the respective accounting standard.

Assets held for sale are subsequently remeasured at the lower of their carrying amount and fair value less cost to sell. Any loss arising from the above measurement is recorded in profit or loss and can be reversed in the future. When the loss relates to a disposal group, it is allocated to the assets within that disposal group.

The Company presents discontinued operations in a separate line in the income statement if a component of the Company's operations has been disposed of or is classified as held for sale and:

(a) Represents a separate major line of business or geographical area of operations;

(b) Is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations;

Profit or loss from discontinued operations includes the profit or loss before tax from discontinued operations, the gain or loss on disposal before tax or measurement to fair value less costs to sell and discontinued operations tax expense. Upon classification of a component of the Company's operations as a discontinued operation, the Company restates prior periods in the income statement.

2.2.26 Cash and cash equivalents

Cash and cash equivalents include cash in hand, unrestricted deposits with central banks, due from credit institutions and other short-term highly liquid investments with original maturities of three months or less.

2.2.27 Government grants

Government grants are transfers of resources to the Company by a government entity such as government, government agencies and similar bodies whether local, national or international, in return for compliance with certain past of future conditions related to the Company's operating activities.

Government grants are recognized when there isreasonable assurance that the grant will be received and the Company will comply with the conditions attached to it. The grants are recognized in the income statement on a systematic basis to match the way that the Company recognizes the expenses for which the grants are intended to compensate. In case of subsequent changes in the Company's expectations of meeting the conditions attached to the government grants, the effect of such changes is recognised in income statement.

2.2.28 Fiduciary activities

The Company provides custody, trustee, corporate administration, investment management and advisory services to third parties. This involves the Company making allocation, purchase and sale decisions in relation to a wide range of financial instruments. The Company receives fee income for providing these services. Those assets that are held in a fiduciary capacity are not assets of the Company and are not recognized in the financial statements. In addition, the Company does not guarantee these investments and as a result it is not exposed to any credit risk in relation to them.

3. Critical accounting estimates and judgments in applying accounting policies

In the process of applying the Company's accounting policies, the Management makes various judgments, estimates and assumptions that may affect the reported amounts of assets and liabilities, revenues and expenses recognized in the financial statements within the next financial year and the accompanying disclosures. Estimates and judgments are continually evaluated and are based on current conditions, historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are recognized prospectively.

Following the completion of the banking sector's hive down on 20 March 2020 (notes 1 and 4) and the subsequent amendment of the corporate name of Eurobank Ergasias S.A. to Eurobank Ergasias Services and Holdings, the significant estimates, judgments and assumptions made by Management in applying the Company's accounting policies and key sources of estimation uncertainty for the period 1 January to 20 March 2020 (i.e. date of hive down) are consistent with those in the financial statements of Eurobank Ergasias S.A. for the year ended 31 December 2019.

Following the hive down date, the most significant areas in which the Company makes judgments, estimates and assumptions in applying its accounting policies are set out below:

3.1 Impairment losses on investment securities

The expected credit losses (ECL) measurement of the Tier 2 subordinated instrument requires management to apply judgement relating to the risk parameters used in the calculation of the ECL and in assessing whether a significant increase of credit risk (SICR) has occurred since initial recognition. These estimates are based on quantitative and qualitative information reasonable and supportable forward looking information. A degree of uncertainty is involved in making estimations using assumptions that may be subjective and sensitive to the risk factors.

Specifically, the assessment of SICR is performed on an individual basis based on the number of notches downgrade in the internal credit rating scale since the origination date while the PD used for the ECL measurement is received by an international rating agency using risk methodologies that maximize the use of observable variables and market data. Furthermore, the LGD used is based on historical data derived from rating agencies' studies that present the recoveries on such instruments taking into account the seniority of the exposure.

Changes in the metrics applied and the assumptions underlined would have a significant effect on the ECL outcome. The Company independently validates all ECL key inputs and underlying assumptions used in the ECL measurement through competent resources.

3.2 Impairment losses on investment in subsidiaries

The Company assesses for impairment its investment in subsidiaries at each reporting date as described in note 2.2.8. If an indication of impairment exists, the Company performs an impairment test by comparing the carrying value of the investment in the subsidiary with its estimated recoverable amount, determined as the higher of its fair value less cost to sell and its value in use, based on reasonable and supportable information. The calculation of the recoverable amount involves the exercise of judgement in selecting the appropriate parameters, such as the applicable discount and growth rates.

3.3 Impairment losses on loans and advances to customers

The expected credit losses (ECL) measurement requires management to apply significant judgment, in particular, the estimation of the amount and timing of future cash flows and collateral values when determining impairment losses and the assessment of a significant increase in credit risk. These estimates are driven by a number of factors, changes in which can result in significant changes to the timing and amount of allowance for credit loss to be recognized. The ECL's calculations are outputs of complex models with a number of underlying assumptions regarding the choice of variable inputs and their interdependencies. In addition, temporary adjustments may be required to capture new developments and information available, which are not reflected yet in the ECL calculation through the risk models.

Although, the ECL calculation methodology regarding the application of macroeconomic scenarios and the incorporation of forward looking information remained unchanged compared to 31 December 2019, the Company revised the forward-looking information incorporated in the above scenarios, in order to capture the negative impact of the Covid-19 pandemic, based on its best estimate regarding such economic forecasts in the first quarter of 2020. In addition, Management applied the appropriate level of judgement regarding its expectations for the severity and the duration of the economy's negative outlook, in line with the International Accounting Standards Board (IASB), the European Central Bank (ECB) and other banking regulators' statements, which emphasize the need for overlays where the risk models do not capture the specific circumstances.

In March 2020, upon the completion of the hive down process, the impairment allowance corresponding to the loans and advances to customer of the banking sector was transferred, inter alia, to Eurobank S.A. (note 4). With regards to the remaining loan portfolio of the Company which comprised the Cairo securitized loans, the completion of the transaction with doValue for the sale of 20% of the mezzanine and 50,1% of the junior notes of Cairo securitization, in June 2020, resulted in the re-measurement of the above portfolio's expected credit losses, in accordance with the Company's relevant accounting policy and by reference to the fair value of the notes retained by the Company, and eventually its de-recognition from the Company's balance sheet (notes 4 and 11).

3.4 Income tax

The Company is subject to income taxes in various jurisdictions and estimates are required in determining the liability for income taxes. The Company recognizes liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due or for anticipated tax disputes. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax in the period in which such determination is made.

In addition, the Company recognizes deferred tax assetsto the extent that it is probable thatsufficient taxable profit will be available against which unused tax losses and deductible temporary differences can be utilized. Recognition therefore involves judgment regarding the future financial performance of the Company. As at 31 December 2020, based on the Management's assessment the Company is not expected to have sufficient future taxable profits, against which the unused tax losses mainly resulting from the Cairo transaction can be utilized (note 10).

3.5 Retirement benefit obligations

The Company determinesthe appropriate discountrate used to calculate the present value of the estimated retirement obligations, at the end of each year based on interest rates of high quality corporate bonds. The currency and term to maturity of the bonds used are consistent with the currency and estimated average term to maturity of the retirement benefit obligations. The salary rate increase assumption is based on future inflation estimates reflecting also the Company's reward structure and expected market conditions.

Other assumptions for pension obligations, such as future inflation estimates, are based in part on current and expected market conditions.

For information in respect of the Company's retirement benefit obligations refer to note 17.

4. Corporate Transformation-Hive down

In November 2018, Eurobank Ergasias announced its transformation plan aiming to enable the former to deal with the challenging non-performing loans (NPEs) reduction targets, achieve a significant balance sheet de-risking and focus on the core banking business. The aforementioned transformation plan included the merger with Grivalia, which was completed in April 2019, and the NPEs reduction Acceleration Plan comprising the steps described below:

a) In June 2019, Eurobank Ergasias, through the special purpose financing vehicle (SPV) 'Pillar Finance Designated Activity Company' issued senior, mezzanine and junior notes of total value of ca. € 2 billion, via a securitization of NPEs, which were fully retained by the entity. In September 2019, Eurobank Ergasias sold the 95% of the above-mentioned mezzanine and junior notes to Celidoria S.A R.L. Upon the completion of the above sale, Eurobank Ergasias ceased to control the SPV and derecognized the underlying loan portfolio in its entirety, on the basis that it transferred substantially all the risks and rewards of the underlying loan portfolio's ownership. In addition, Eurobank Ergasias recognized the retained notes, i.e. 100% of the senior, 5% of the mezzanine and junior notes, on its balance sheet (notes 12 and 16).

b) In June 2019, Eurobank Ergasias, through the special purpose financing vehicles (SPVs) 'Cairo No. 1 Finance Designated Activity Company', 'Cairo No. 2 Finance Designated Activity Company' and 'Cairo No. 3 Finance Designated Activity Company', issued senior (Class A), mezzanine (Class B1 and B2) and junior (Class C1 and C2) notes of total value of ca. € 7.5 billion, via a securitization of a mixed portfolio consisting primarily of NPEs, which were fully retained by the entity. The control of the SPVs resides with the majority holder of Class B1. Accordingly, Eurobank Ergasias being the sole holder of the issued notes, controlled the SPVs and continued recognizing the underlying loan portfolio on its balance sheet on the basis that it retained substantially all risks and rewards of its ownership (note 16).

On 23 March 2020, the distinctive title of Eurobank Ergasias S.A. was amended to Eurobank Holdings.

Accordingly, following the hive down, the ownership distribution of Cairo notes is depicted below:

Cairo noteholders post hive down

	(A) - Eurobank	(B) - Eurobank	(C) = (A) + (B) - Eurobank Holdings
Cairo notes	S.A.	Holdings	Group/ Total Issue
A Senior	100%	0%	100%
B1 Mezzanine	5%	20%	25%
B2 Mezzanine	-	75%	75%
B Total	5%	95%	100%
C1 Junior	5%	50.1%	55.1%
C2 Junior	-	44.9%	44.9%
C Total	5%	95%	100%

d) In December 2019, Eurobank Ergasias S.A. announced that it has entered into binding agreements with doValue S.p.A. for the sale of the 20% of the mezzanine (representing the 80% of Class B1) and 50.1% of the junior notes of the aforementioned Cairo securitization in exchange for a cash consideration of ca. € 14 million. In June 2020 the sale was completed.

Upon the sale of 20% of the mezzanine notes, which effectively represents the majority stake of the Class B1, Eurobank Holdings ceased to control the SPVs and the related Cairo real estate companies, i.e. Cairo Estate I Single Member S.A, Cairo Estate II Single Member S.A, Cairo Estate III Single Member S.A. Furthermore, being the holder of 75% of the mezzanine and 44.9% of the junior notes, Eurobank Holdings, ceased to have control over the securitized loans, which resides with the SPV being the only party that has the practical ability to sell the loans under the instructions of the majority stake of B1 noteholders. Accordingly, Eurobank Holdings derecognized the investments in the above-mentioned subsidiaries as well as the securitized loan portfolio at its carrying amount.

The completion of the aforementioned sale transaction triggered the re-measurement of the portfolio's expected credit losses in accordance with the entity's accounting policy for the impairment of financial assets. Therefore, a loss of € 1,506 million was recognized in the second quarter of 2020 that was based on the fair valuation of the notes retained (notes 9 and 12).

The table below presents the ownership distribution of Cairo notes following the steps described in points (b) to (d) above:

Cairo noteholders after the completion of the sale transaction

Cairo notes	(A) - Eurobank S.A.(1)	(B) - Eurobank Holdings	(C) = (A) + (B) - Eurobank Holdings Group	(D) - Third Parties(2)	(E) = (C) + (D) - Total issue
A Senior	100%	0%	100%	-	100%
B1 Mezzanine	5%	-	5%	20%	25%
B2 Mezzanine	-	75%	75%	-	75%
B Total	5%	75%	80%	20%	100%
C1 Junior	5%	-	5%	50.1%	55.1%
C2 Junior	-	44.9%	44.9%	-	44.9%
C Total	5%	44.9%	49.9%	50.1%	100%

(1) Transferred from Eurobank Ergasias S.A. upon hive down.

(2) Sold to doValue S.p.A.

e) On 15 June 2020, Eurobank Holdings, following a decision of the Board of Directors (BoD), proceeded to the contribution of the retained Cairo notes, i.e. 75% of the mezzanine and 44.9% of the junior notes along with an amount of € 1.5 million in cash to its Cyprus-based subsidiary Mairanus Ltd, renamed to 'Cairo Mezz Plc', in exchange for the newly-issued shares of the above mentioned subsidiary. Based on the valuation, according to the provisions of Article 17 of L. 4548/2018, the fair value of the shares received by Eurobank Holdings amounted to € 57.5 million consisting of the fair value of the contributed Cairo notes of € 56 million and the cash amount of € 1.5 million (notes 14 and 16). The abovementioned BoD decision for the contribution of the Cairo notes retained by Eurobank Holdings initiated the distribution process and clearly demonstrated Management's commitment to the specific plan for the notes' disposal as the last step to the Group's Corporate Transformation Plan.

f) On 7 July 2020, the BoD of Eurobank Holdings proposed to the General Shareholders' Meeting the distribution of Cairo Mezz Plc shares to Eurobank Holding's shareholders through the decrease in kind of its share capital. On 28 July 2020, the General Shareholders' Meeting approved the decrease in kind of Eurobank Holdings' share capital via the decrease of the nominal value of each ordinary shareand the distribution to its shareholders of the shares issued by Cairo Mezz Plc with a value corresponding to the value of the share capital decrease, at a ratio of 1 share of Cairo Mezz Plc for every 12 Eurobank Holdings' shares already held. The Ministry of Development & Investments by virtue of its decision 81660/31.07.2020 approved the amendment of article 5 of Eurobank Holdings' Articles of Association. The impact from the distribution of Cairo Mezz Plc shares to Eurobank Holding's shareholders was the reduction by an equal amount of € 57.5 million of Eurobank Holding's share capital along with the related costs directly attributable to the equity transaction of € 0.4 million (note 18).

The below table presents, the ownership distribution of the Cairo notes following the completion of all steps involved, as described in points (b) to (f) above, as well as the respective valuation prices of each class of notes:

	(A) - Eurobank	(B) - Eurobank	(C) = (A) + (B) - Eurobank	(D) - Cairo	(E) - Third	(F) = (C) + (D) + (E) -	Valuation
Cairo notes	S.A.(1)	Holdings	Holdings Group	Mezz Plc(2)	parties(3)	Total issue	price
A Senior	100%	0%	100%	0%	-	100%	100%
B1 Mezzanine	5%	-	5%	-	20%	25%
B2 Mezzanine	-	0%	0%	75%	-	75%
B Total	5%	0%	5%	75%	20%	100%	5%
C1 Junior	5%	-	5%	-	50.1%	55.1%
C2 Junior	-	0%	0%	44.9%	-	44.9%
C Total	5%	0%	5%	44.9%	50.1%	100%	0%

Cairo noteholders after the completion of the distribution (September 2020)

(1) Transferred from Eurobank Ergasias S.A. upon hive down.

(2) Contributed by Eurobank Holdings and subsequently distributed to its shareholders.

⁽³⁾ Sold to doValue S.p.A.

Following the completion of all steps involved, as described in points (b) to (f) above, the total equity impact for Eurobank Holdings, is presented in the below table:

	NAV
	impact
Impairment loss upon securitized loans' de-recognition (note 9)	(1,506)
Distribution of Cairo Mezz Plc shares	(58)
	(1,564)

Hive down

On 20 March 2020, the demerger of Eurobank Ergasias through the banking sector's hive down and the establishment of a new company-credit institution ("Demerger") under the corporate name "Eurobank S.A" as well as the Articles of Association of the Beneficiary were approved by virtue of the decision of the Ministry of Development and Investments No 31847/20.03.2020, which was registered on the same day in the General Commercial Registry. At the aforementioned date: a) the Demerged Entity becomes the shareholder of the Beneficiary by acquiring all the shares issued by the Beneficiary and more specifically 3,683,244,830 common registered shares, of a nominal value of € 1.10 each and b) the Beneficiary substitutes the Demerged Entity, by way of universal succession, to all the transferred assets and liabilities, as set out in the transformation balance sheet of the hived down sector as at 30 June 2019 and formed up to 20 March 2020, day of the Demerger's completion. In respect of pending lawsuits where the Demerged entity was an involved party and are related to the hived down banking sector, they will continue ipso jure by the Bank or against it.

The hive down of the banking sector (including subsidiaries/associates) constitutes a common control transaction, which involves a new entity to effect the combination of entities under common control. As a common control transaction, the hive down does not fall within the scope of the IFRS 3 'Business Combinations'; furthermore, it is a common control transaction that involves the setup of a new company, which is neither the acquirer, nor a business and therefore it is not a business combination as defined by IFRS 3. Since IFRS 3 guidance does not apply, and the hive down does not meet the definition of a business combination under common control, it is accounted for as a capital re-organisation of the transferred business on the basis that no substantive economic change has occurred. In line with the Group's accounting policy for business combinations that involve the formation of a new entity, in case of a capital reorganization, the acquiring entity incorporates the assets and liabilities of the acquired entity at their carrying amounts, as presented in the books of that acquired entity, rather than those from the highest level of common control. Any difference between the cost of the transaction and the carrying amount of the net assets acquired is recognized in the

equity of the new entity. In addition, the capital reorganization transactions do not have any impact on the Group's consolidated financial statements.

Accordingly, in the separate financial statements of Eurobank Holdings, the assets and liabilities of the business transferred (including investments in subsidiaries and associates) to Eurobank (Beneficiary) were derecognised and the investment in the Beneficiary was recognised at cost, which is the carrying value of the net assets given up. The Beneficiary respectively incorporated the assets and liabilities of the existing business at their pre-combination carrying amounts with a corresponding increase in share capital. Pre-existing valuation reserves under IFRS that were transferred to the Beneficiary were separately recognized in the Beneficiary's total equity.

In accordance with the Demerger Deed, Eurobank Holdings maintained activities and assets that are not related to the main banking activities but are mainly related to the strategic planning of the administration of non-performing loans and the provision of services to the Group companies and third parties. Furthermore, Eurobank Holdings retained the 95% of Cairo mezzanine and junior notes, the preferred securities and the participations in certain subsidiaries including Be Business Exchanges S.A., Cairo DACs, Pillar and Cairo real estate entities. In case of any assets or liabilities that would not be possible to be transferred, in the context of the above mentioned Draft Demerger Deed, the Demerged Entity undertakes the obligation to collect or liquidate the assets in accordance with the Beneficiary's instructions whereas the Beneficiary undertakes the obligation to indemnify the Demerged Entity for the settlement of the liabilities including any arising costs or losses. Accordingly, the Beneficiary, receives the remaining assets (including 100% of Cairo senior and 5% of mezzanine and junior notes that were recognized at fair value) and liabilities that constitute the banking sector, by issuing shares to the Demerged entity.

	20 March 2020
	(A) - Eurobank Ergasias S.A. € million	(B) - Intercompany (IC) net assets contributed to Eurobank S.A € million	(C) - Total net assets contributed to Eurobank S.A. € million	(D) - IC net assets of Eurobank Holdings & investment in Eurobank S.A. € million	(E) = (A) + (B) - (C) + (D) Eurobank Holdings S.A. € million
ASSETS
Cash and balances with central banks	1,916		1,916		-
Due from credit institutions	3,887		3,817	103 1	173
Securities held for trading	28		28		-
Derivative financial instruments	2,381		2,381		-
Loans and advances to customers	30,023	2,425 2	28,592		3,856
Investment securities	6,995		6,995	950 3	950
Shares in subsidiaries	1,855		1,854	4,090 4	4,091
Investments in associates and joint ventures	101		101		-
Property and equipment	567		567		0
Investment property	873		873		-
Goodwill and other intangible assets	316		316		0
Deferred tax assets	4,832		4,832		-
Other assets	1,778	4	1,779		3
Assets of disposal groups classified as held for sale	41		41		-
Total assets	55,593	2,429	54,092	5,143	9,073
LIABILITIES
Due to central banks	2,700		2,700		-
Due to credit institutions	7,677		7,677		-
Derivative financial instruments	2,904		2,904		-
Due to customers	33,169	103 1	33,272		-
Debt securities in issue	2,412	950 3	2,402	2,425 2	3,385
Other liabilities	1,064		1,047	4	21
Total liabilities	49,926	1,053	50,002	2,429	3,406
Total equity	5,667	1,376	4,090 4	2,714	5,667

Notes

€ 103 million refer to deposits of Eurobank Holdings with Eurobank S.A.
€ 2,425 million refer to the notes of Cairo securitizations retained by Eurobank S.A. (i.e. 100% senior notes, 5% of mezzanine and junior notes).
€ 950 million refer to Tier 2 notes issued by Eurobank S.A. and retained by Eurobank Holdings.
€ 4,090 million refer to the investment in Eurobank S.A. held by Eurobank Holdings corresponding to the net assets contributed to the former by Eurobank Ergasias S.A.; Eurobank S.A. total equity of € 4,090 million as at 20 March 2020 comprises (a) share capital of € 4,051.6 million as it has been determined based on the assets and liabilities included in the transformation balance sheet of the hived-down banking sector of Eurobank Ergasias S.A. as at 30 June 2019, (b) pre-existing valuation reserves of € 238.7 million and (c) retained losses of € 200.4 million.

5. Financial risk management and fair value

The Company is exposed to financial risks such as credit risk, market risk (including currency and interest rate risk) liquidity risk and operational risks.

5.1 Financial risk factors and risk management

As part of its overall system of internal controls the Company has engaged in a Service Level Agreement (SLA) with Eurobank S.A. in order to receive supporting and advisory services in all applicable areas of risk management (credit, market, liquidity and operational risks) undertaken by the company.

The Company's overall risk management strategy seeks to minimize any potential adverse effects on its financial performance,

financial position and cash flows.

Following the completion of the corporate transformation (note 4) the main financial risks to which the Company is exposed relate to:

(a) Credit risk

The Company takes on exposure to credit risk which is the risk that a counterparty will be unable to fulfill its payment obligations in full when due. The Company is mainly exposed to a subordinated instrument (note 13) issued by its subsidiary Eurobank S.A. and € 14 million deposits that are placed with the latter. Accordingly, the aggregate carrying amount of the above financial assets approximates the maximum credit risk exposure of the Company.

(b) Market risk

The Company takes on exposure to market risk, which is the risk of potential financial loss due to an adverse change in market variables, such as interest rates and foreign exchange rates.

The Company's interest rate risk, which mainly arises from the position in the aforementioned subordinated fixed rate instrument, is eliminated by the Tier 2 subordinated capital instrument issued by the Company, which has equivalent terms with those of the former.

The Company's financial assets and liabilities are in Euro, therefore, currency risk is eliminated.

(c) Liquidity risk

The maturity of the Company's main assets and liabilities, which relate to the aforementioned subordinated instruments, match, and the underlying cash flows are the same. Accordingly, the Company's liquidity or cash flow risk is substantially eliminated.

5.2 Fair value of financial assets and liabilities

The Company's financial instruments carried at amortized cost are categorised into the three levels of fair value hierarchy based on whether the inputs to their fair values are market observable or unobservable, as follows:

Level 1 Financial instruments are measured based on quoted prices (unadjusted) in active markets for identical financial instruments that the Company can access at the measurement date. A market is considered active when quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency and represent actually and regularly occurring transactions. Following the completion of the corporate transformation (note 4), none of the Company's financial instruments are categorised into Level 1 of the fair value hierarchy.
Level 2 Financial instruments are measured using valuation techniques with inputs other than level 1 quoted prices, observable either directly or indirectly, such as (i) quoted prices for similar financial instruments in active markets (ii) quoted prices for identical financial instruments in markets that are not active, (iii) inputs other than quoted prices that are directly or indirectly observable, mainly interest rates and yield curves observable at commonly quoted intervals, forward exchange rates, equity prices, credit spreads and implied volatilities obtained from internationally recognised market data providers and (iv) other unobservable inputs which are insignificant to the entire fair value measurement. Following the completion of the corporate transformation (note 4), Level 2 financial instruments include the subordinated instrument (note 13) issued by its subsidiary Eurobank S.A. and the Tier 2 subordinated capital instrument (note 16) issued by the Company.
Level 3 Financial instruments are measured using valuation techniques with significant unobservable inputs. When developing unobservable inputs, best information available is used, including own data, while at the same time market participants' assumptions are reflected (e.g. assumptions about risk). Following the completion of the corporate transformation (note 4), the Company's financial instruments, which are categorised into Level 3 of the fair value hierarchy refer mainly to the sight deposits with Eurobank S.A.

The fair value of the Tier 2 capital instrument issued by the company was determined by using quotes for identical financial instruments in non-active markets and amounted to € 932 million (2019: € 865 million). The fair value of the subordinated instrument issued by the Company's subsidiary Eurobank S.A. was determined based on the aforementioned instrument, which has equivalent terms, therefore, amounted also to € 932 million. Moreover, the carrying amount of the Company's sight deposits with Eurobank S.A. represents reasonable approximation of their fair value.

6. Net interest income

	31 December	31 December
	2020	2019
	€ million	€ million
Interest income
Customers	75	186
Securities	46	-
	121	186
Interest expense
Debt securities in issue	(58)	-
	(58)	-
Total from continuing operations	63	186

In the year ended 31 December 2020, an amount of € 46 million is included in interest expense (continuing operations) relating to the TIER 2 capital instruments issued by the Company, while an equal amount is included in interest income for the subordinated TIER 2 note issued by Eurobank SA and held by the Company. In addition, interest expense includes € 12.4 million for the financial liability relating to the Senior notes of the Cairo securitization contributed to Eurobank SA as of the hive down date i.e. 20 March 2020 (note 4).

In the year ended 31 December 2020, interest income from customers refers to the underlying loan portfolio of the Cairo securitization until its derecognition in June 2020, while for the comparative period it refers to the underlying loan portfolios of Cairo and Pillar securitizations. As no internal allocations have been made between continuing and discontinued operations, the funding expense of the Company's aforementioned continuing activities until the hive down date was included in the net interest income of the discontinued activities i.e. those of the hived down banking sector (note 4).

7. Commission income/(expense)

The commission expense amounting to € 8 million (2019: €12 million) , refers to the administrative fees to Eurobank FPS Loans and Credits Claim Management S.A. (renamed to doValue Greece Loans and Credits Claim Management S.A.) for the management of the Cairo loan portfolio.

8. Operating expenses

In the year ended 31 December 2020 the operating expenses are € 9 million mainly refer a) to staff cost € 3.7 million (2019: € 3.1 million) and b) other administrative expenses € 5.2 million (2019: € 4.4 million). Administrative expenses include € 4 million (2019: € 4.4 million) insurance premiums relating to the Group's financial lines insurance, including protection for professional liability.

9. Impairment allowance for loans and advances to customers

The following tables present the movement of the impairment allowance on loans and advances to customers (expected credit losses – ECL):

	31 December 2020
	Wholesale			Mortgage			Consumer			Small business
	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Lifetime ECL credit impaired	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Lifetime ECL credit impaired	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Lifetime ECL credit impaired	12-month ECL - Stage 1	Lifetime ECL - Stage 2	Lifetime ECL credit impaired	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Impairment allowance as at 1 January Discontinued operations (Hived down banking	49	74	2,214	11	173	1,456	28	36	831	17	96	1,481	6,466
sector)	(48)	(59)	(919)	(11)	(145)	(601)	(28)	(35)	(589)	(17)	(80)	(451)	(2,983)
Transfers between stages
- to 12-month ECL	-	-		- 1	(1)	(0)	0	(0)	(0)	2	(1)	(1)	-
- to lifetime ECL	-	-		- (0)	10	(10)	(0)	1	(1)	(0)	5	(5)	-
- to lifetime ECL credit-impaired loans	-	(12)	12	(0)	(12)	12	(0)	(0)		0 (0)	(8)	8	-
Impact of ECL net remeasurement	3	15	474	6	58	391	0	0	31	19	36	473	1,506
Loans and advances derecognised(1)	(4)	(18)	(1,764)	(7)	(83)	(1,234)	(0)	(1)	(268)	(21)	(48)	(1,469)	(4,917)
Amounts written off	-	-		- -	-	(1)		- -	(1)	-	-	(1)	(3)
Unwinding of Discount	-	-	(18)	-	-	(9)		- -	(3)	-	-	(22)	(52)
Foreign exchange and other movements	-	-		1 -	-	(4)		- (1)		0 -	-	(13)	(17)
Impairment allowance as at 31 December	-	-	-	-	-	-	-	-	-	-	-	-	-

EUROBANK ERGASIAS SERVICES and HOLDINGS S.A.

Notes to the Financial Statements

	31 December 2019
	Wholesale			Mortgage			Consumer			Small business
	12-month ECL	Lifetime ECL	Lifetime ECL credit	12-month ECL	Lifetime ECL	Lifetime ECL credit	12-month ECL	Lifetime ECL	Lifetime ECL credit	12-month ECL	Lifetime ECL	Lifetime ECL credit
	Stage 1	Stage 2	impaired	Stage 1	Stage 2	impaired	Stage 1	Stage 2	impaired	Stage 1	Stage 2	impaired	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million

Impairment allowance as at 1 January	50	97	2,581	30	279	2,145	33	91	919	11	211	1,520	7,967
New loans and advances originated or purchased Transfers between stages	14	-		0 -	-		6 -	-	-	1	-	-	21
- to 12-month ECL	13	(12)	(1)	41	(40)	(1)	29	(27)	(2)	84	(83)	(1)	-
- to lifetime ECL not credit-impaired loans	(6)	41	(35)	(2)	119	(117)	(6)	38	(32)	(1)	82	(81)	-
- to lifetime ECL credit-impaired loans	(1)	(6)	7	(2)	(35)	37	(1)	(19)	20	(0)	(24)	24	-
Impact of ECL net remeasurement	(21)	(47)	185	(58)	(143)	360	(31)	(47)	177	(76)	(91)	208	416
Recoveries from written - off loans	-	-	0	-	-	0	-	-	1	-	-	0	1
Loans and advances derecognised/reclassified as
held for sale during the year(1)	-	-	(112)	-	(14)	(830)	(2)	(0)	(0)	(1)	(0)	(0)	(959)
Amounts written off	-	-	(364)	-	-	(119)	-	-	(210)	-	-	(125)	(818)
Unwinding of Discount	-	-	(66)	-	-	(44)	-	-	(24)	-	-	(61)	(195)
Foreign exchange and other movements	(0)	1	19	2	7	25	(0)	0	(18)	(1)	1	(3)	33
Impairment allowance as at 31 December	49	74	2,214	11	173	1,456	28	36	831	17	96	1,481	6,466

(1) It represents the impairment allowance of loans derecognized during the year due to a) securitization/sale transactions and b) substantial modifications of the loans' contractual terms and those that have been reclassified as held for sale during the year.

The impairment losses relating to loans and advances to customers recognized in the Company's income statement for the year ended 31 December 2020 amounted to € 1,508 million (2019: € 529 million of which € 207 million relate to the continuing operations) and are analyzed as follows:

	2020	2019
	€ million	€ million

Impairment loss on loans and advances to customers	(1,506)	(196)
Modification loss on loans and advances to customers	(2)	(11)
Total from continuing operations	(1,508)	(207)

10. Income tax

As of the year 2019 onwards, according to Law 4646/2019 which was enacted in December 2019 and amended Law 4172/2013, the Greek corporate tax rate for legal entities other than credit institutions (i.e. credit institutions that fall under the requirements of article 27A of Law 4172/2013 regarding eligible DTAs/deferred tax credits) decreased from 29% to 24%. In addition, according to the aforementioned Law 4646/2019, as of 1 January 2020 the withholding tax rate for dividends distributed, other than intragroup dividends, decreased from 10% to 5%. In particular, the intragroup dividends under certain preconditions are relieved from both income and withholding tax.

Based on the management's assessment the Company is not expected to have sufficient future taxable profits, against which the unused tax losses mainly resulting from the Cairo transaction (note 12) can be utilised. Accordingly, in the year ended 31 December 2020, an income tax has not been recognized for the Company's continuing operations. For the comparative year, an amount of € 24 million deferred income tax attributable to the Company's continuing operations has been recognized mainly referring to impairment losses relating to loans and advances to customers.

Deferred tax

The movement on deferred tax is as follows:

	31 December	31 December
	2020	2019
	€ million	€ million
Balance at 1 January	4,754	4,901
Income statement credit/(charge) from continuing operations	-	24
Income statement credit/(charge) from discontinued operations	1	(8)
Investment securities at FVOCI	80	(167)
Cash flow hedges	(3)	2
Other	0	2
Hived down banking sector	(4,832)	-
Balance at 31 December	-	4,754

Tax certificate and open tax years

The Company, in accordance with the general principles of the Greek tax legislation has 6 open tax years (i.e. five years as from the end of the fiscal year within which the relevant tax return should have been submitted). For the open tax year 2015 the Company was required to obtain an 'Annual Tax Certificate' pursuant to the Law 4174/2013, which is issued after a tax audit is performed by the same statutory auditor or audit firm that audits the annual financial statements. For fiscal years starting from 1 January 2016 onwards, the 'Annual Tax Certificate' is optional, however, the Company will continue to obtain such certificate.

The tax certificates, which have been obtained by the Company are unqualified for the open tax years 2015-2019. For the year ended 31 December 2020, the tax audit from external auditor is in progress.

In accordance with the Greek tax legislation and the respective Ministerial Decisions issued, additional taxes and penalties may be imposed by the Greek tax authorities following a tax audit within the applicable/aforementioned statute of limitations, irrespective of whether an unqualified tax certificate has been obtained from the tax paying company. In light of the above, as a general rule, the right of the Greek State to impose taxes up to tax year 2014 (included) has been time-barred for the Company as at 31 December

EUROBANK ERGASIAS SERVICES and HOLDINGS S.A.

Notes to the Financial Statements

On 18 January 2021, the Company received two orders for a tax audit by the tax authorities for the tax years 2015 and 2016. The tax audit is in progress.

In reference to its total uncertain tax positions, the Company assesses all relevant developments (e.g. legislative changes, case law, ad hoc tax/legal opinions, administrative practices) and raises adequate provisions.

Unused tax losses

As at 31 December 2020, the Company has not recognised deferred tax asset (DTA) on unused tax losses amounted to € 400 million (2019: € 233 million). The analysis of unrecognized DTA on unused tax losses of the Company per year of maturity of related tax losses is presented in the table below:

	Unrecognised
	DTA
	€ million
Year of maturity of unused tax losses
2023	48
2024	68
2025	284
Total	400

11. Discontinued operations

(a) Discontinued operations

Following the demerger of Eurobank Ergasias S.A. through the banking sector's hive down, which was completed on 20 March 2020 (note 4), the results of the banking sector for the current period (i.e. from 1 January to 20 March 2020), which comprised the major part of the demerged company's operations, are presented as discontinued operations. The comparative information for year ended 31 December 2019 are presented based on the results of the net assets transferred, without any notional internal allocations between the continued and discontinued operations.

The results of the discontinued operations are presented in the below table:

	20 March	31 December
	2020	2019
	Hived down	Hived down
	banking	banking sector
	sector
	€ million	€ million

Net interest income	182	806
Net banking fee and commission income	31	159
Income from non banking sercives	14	42
Dividend income	0	142
Net trading income/(loss)	(2)	(24)
Gains less losses from investment securities	2	74
Other income/(expenses)	(2)	43
Operating income	225	1,242
Operating expenses	(144)	(646)
Profit before impairments, provisions and restructuring
costs from discontinued operations	81	596
Impairment losses relating to loans and
advances to customers (1)	(109)	(322)
Goodwill impairment	-	(62)
Other impairment losses and provisions	(10)	(41)
Restructuring costs	(4)	(69)
Profit/(Loss) before tax from discontinued operations	(42)	102
Income tax	1	(12)
Net profit/(loss) from discontinued operations	(41)	90

(1) For the period 1 January to 20 March 2020, it includes impairment loss on loans and advances to customers of € 87 million and modification loss of € 22 million (for the year ended 31 December 2019: € 242 million, € 51 million respectively, while € 29 million related to impairment loss for credit related commitments).

Information on the assets and liabilities transferred in the context of the Hive-down of the banking sector of Eurobank Ergasias is provided in note 4.

(b) Equity reserve: revaluation of the investment securities at FVOCI

	2020	2019
	€ million	€ million

Balance at 1 January	462	53
Net gains/(losses) from changes in fair value	(203)	980
Tax (expense)/benefit	60	(284)
	(143)	696
Net (gains)/losses transferred to net profit on disposal	(10)	(60)
ECL transferred to net profit	2	(6)
Tax (expense)/benefit on net (gains)/losses transferred to net profit on disposal	3	17
Tax (expense)/benefit on ECL transferred to net profit	0	2
	(5)	(47)

Net (gains)/losses transferred to net profit from fair value hedges	(58)	(338)
Tax (expense)/benefit	17	98
	(41)	(240)

Transfer of reserve relating to dicontinued operations net of tax (hive-down)
to retained earnings	(273)	-
Balance at 31 December	-	462

12. Loans and advances to customers

Cairo securitization – loans' derecognition

In December 2019, Eurobank Ergasias announced that it has entered into a binding agreement with doValue S.p.A. for the sale of 20% of the mezzanine and 50.1% of the junior notes of a securitization of a mixed portfolio consisting primarily of non-performing loans (NPEs) of ca. € 7.5 billion gross book value. In June 2020, the above sale was completed for a cash consideration of ca. € 14 million.

Upon completion of the sale of 20% of the mezzanine notes that effectively represents the majority stake of Class B1, i.e. 80% of Class B1, Eurobank Holdings (ex-Eurobank Ergasias post hive down) ceased to control the SPVs on the basis that it does not have the power to direct their relevant activities that resides with the majority stake of Class B1 noteholders. At the same time, the above sale triggered the de-recognition assessment of the underlying loan portfolio where it was concluded that Eurobank Holdings ceased to have control over the securitized loans, which resides with the SPV being the only party that has the practical ability to sell the loans under the instructions of the majority stake of B1 noteholders.

Accordingly, in June 2020, Eurobank Holdings proceeded with the re-measurement of the portfolio's expected credit losses in accordance with its accounting policy for the impairment of financial assets and recognized an impairment loss of € 1,506 million net of expenses (note 9) in the second quarter of 2020 based on the fair value of the notes retained by Eurobank Holdings, the carrying amount of the notes de-recognized from its financial liabilities and the consideration received for the mezzanine notes' disposal to doValue S.p.A. Furthermore, in June 2020, Eurobank Holdings, (i) derecognized the underlying loan portfolio in its entirety of carrying amount € 2,341 million, comprising loans with gross carrying amount of € 7,259 million which carried an impairment allowance of € 4,918 million after the recognition of the Cairo loss , along with the impairment allowance of the letter of guarantees included in the underlying portfolio of € 12 million as well asthe related net securitization receivables of € 163 million, (ii) derecognized from its financial liabilities the obligations for the Cairo notes transferred to Eurobank through the hive down process, i.e. 100% of senior, 5% of mezzanine and 5% of junior notes, of carrying amount € 2,422 million, including the senior notes' accrued income (iii) recognized the fair value of the retained mezzanine and junior notes within its financial assets, i.e. 75% of mezzanine and 44.9% of junior notes of € 56 million as well as the cash consideration received from doValue S.p.A. of € 14 million.

Finally, in June 2020, following the respective decision by its Board of Directors to contribute the aforementioned Cairo notes to its Cyprus-based subsidiary company Mairanus Ltd (renamed to 'Cairo Mezz Plc΄), Eurobank Holdings derecognized the retained notes

from its balance sheet and recognized an investment in the above subsidiary for the newly-issued shares issued in exchange for the notes contributed.

The table below represents the percentage holding of the Cairo notes as at 31 December 2020 as well as their valuation price:

				(D) = (A) + (B) + (C) -
	(A) - Eurobank	(B) - Eurobank	(C) - Cairo Mezz	Eurobank Holdings	(E) - Third	(F) = (D) + (E) -
Cairo notes	S.A. (1)	Holdings	Plc(2)	Group	parties(3)	Total issue	Valuation price
A Senior	100%	0%	0%	100%	-	100%	100%
B1 Mezzanine	5%	-	-	5%	20%	25%	-
B2 Mezzanine	-	0%	75%	75%	-	75%	-
B Total	5%	0%	75%	80%	20%	100%	5%
C1 Junior	5%	-	-	5%	50.1%	55.1%	-
C2 Junior	-	0%	44.9%	44.9%	-	44.9%	-
C Total	5%	0%	44.9%	49.9%	50.1%	100%	0%

(1) Transferred from Eurobank Ergasias upon hive down.

(2) Contributed by Eurobank Holdings and subsequently distributed to its shareholders.

(3) Sold to doValue S.p.A.

Pillar securitization – loans' derecognition

In June 2019, Eurobank Holdings announced that it has entered into a binding agreement with Celidoria S.A R.L for the sale of 95% of the mezzanine and junior notes of a securitization of a residential mortgage loan portfolio of ca. € 2 billion gross book value comprising primarily NPEs. Eurobank Holdings would retained the 100% of the senior notes, as well as the 5% of the mezzanine and junior notes. As at 30 June 2019, the portfolio comprising loans with gross carrying amount of € 1,987 million, which carried an impairment allowance of € 845 million, was classified as held for sale. The net carrying amount of the loan portfolio amounting to € 1,142 million corresponded to its implied valuation based on the nominal value of the senior notes and the sale price of the mezzanine notes according to the terms of the above agreement.

In September 2019, the above transaction was completed for a total consideration of € 102.5 million, of which € 70 million cash and € 32.5 million deferred amount subject to the fulfillment of the terms of the agreement. The final consideration amounted to € 70 million in cash, while the above deferred amount that was previously recognized, was reversed in the fourth quarter of 2019, as the underlying terms and conditions were not fulfilled. Accordingly, Eurobank Holdings ceased to control the SPV ('Pillar Finance Designated Activity Company') and de-recognized the underlying loan portfolio in its entirety, on the basis that it transferred substantially all risk and rewards of the underlying loan portfolio's ownership. In addition, Eurobank Ergasias recognized the retained notes on its balance sheet. In March 2020, upon the completion of the hive down process, the retained notes transferred, inter alia, to Eurobank.

The following table presents the movement of the gross carrying amounts for loans and advances to customers by product line and stage and is calculated by reference to the opening and closing balances for the reporting year from 1 January 2020 to 31 December 2020:

	31 December 2020
	Wholesale			Mortgage			Consumer			Small business
	Lifetime ECL		Lifetime ECL			Lifetime ECL				Lifetime ECL
	12-month	Lifetime ECL -	credit	12-month	Lifetime ECL -	credit	12-month	Lifetime ECL -	credit	12-month	Lifetime ECL -	credit
	ECL - Stage 1	Stage 2	impaired	ECL - Stage 1	Stage 2	impaired	ECL - Stage 1	Stage 2	impaired	ECL - Stage 1	Stage 2	impaired	Total
	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million	€ million
Gross carrying amount at 1 January	9,572	1,276	4,130	5,878	3,042	3,736	1,351	264	971	1,873	888	3,133	36,114
Discontinued operations (Hived down
banking sector)	(9,564)	(1,103)	(1,804)	(5,853)	(2,820)	(1,871)	(1,351)	(259)	(659)	(1,821)	(713)	(1,008)	(28,826)
Transfers between stages
-to 12-month ECL	-	-		- 7	(6)	(1)		0 (0)	(0)	22	(22)	(0)	-
-to lifetime ECL	-	-		- (11)	54	(43)	(0)	1	(1)	(15)	38	(23)	-
-to lifetime ECL credit
impaired loans	-	(133)	133	(2)	(86)	88	(0)	(1)		1 (6)	(83)	89	-
Loans and advances derecognised during
the year	(7)	(39)	(2,453)	(19)	(183)	(1,905)	(0)	(5)	(309)	(54)	(109)	(2,177)	(7,260)
Amounts written-off	-	-		- -	-	(1)		- -	(1)		- -	(1)	(3)
Repayments	-	-		- (0)	(0)	(2)	(0)	(0)	(1)	(0)	(0)	(1)	(4)
Foreign exchange differences and other
movements	(1)	(1)	(6)	(0)	(1)	(1)		0 (0)	(1)	1	1	(12)	(21)
Gross Carrying amount at
31 December	-	-		- -	-		-	- -		-	- -	-	-

13. Investment securities

In the context of the hive down (note 4), considering that the obligations of Eurobank Ergasias (' Demerged Entity') arising from the Tier 2 Subordinated capital instruments were not transferred to Eurobank SA ('the Beneficiary'), the latter pursuant to the terms of the Draft Demerger Deed has explicitly and irrevocably undertaken to fulfil the relevant obligations. Accordingly, on 20 March 2020, the Beneficiary issued a subordinated instrument of equivalent terms with those of the TIER 2 mentioned above which was fully subscribed by the Demerged Entity. As at 31 December 2020, the carrying amount of the subordinated instrument held by the Company and categorised as at amortised cost, amounted to € 942 million, including accrued interest of € 0.2 million and impairment allowance of € 8 million (12-month ECL). The fair value of the said security was determined based on quotes for the related Tier 2 instrument (note 16) and amounted to € 932 million.

14. Shares in subsidiaries

The following is a listing of the Company's subsidiaries held directly at 31 December 2020:

Name	Note	Percentage holding	Country of incorporation	Line of business
Eurobank S.A.	a	100.00	Greece	Banking
Be Business Exchanges S.A. of Business Exchanges Networks and				Business-to-business e-commerce,
Accounting and Tax Services		98.01	Greece	accounting, tax and sundry services

(a) Eurobank S.A., Greece

(b) Cairo Mezz Plc, portfolio company, Cyprus

(c) Special purpose financing vehicles for the securitization of loan portfolios and related real estate companies – Project "Cairo"

On 5 June 2020, the Company announced that the sale of a portion of mezzanine and junior securitization notes of the € 7.5 billion multi-asset NPE securitization (project "Cairo"), has been completed (note 16). Following the above, the Company ceased to have control over the related special purpose financing vehicles (Cairo No. 1 Finance Designated Activity Company, Cairo No. 2 Finance Designated Activity Company, Cairo No. 3 Finance Designated Activity Company) and the related real estate companies(Cairo Estate I Single Member S.A., Cairo Estate II Single Member S.A., Cairo Estate III Single Member S.A.).

15. Other assets

As at 31 December 2020, other assets amounting to € 3.7 million primarily consist of (a) € 2.1 million prepaid expenses mainly for insurance premiums (note 8) and (b) € 1.1 million receivables for IT services provided to the Group companies and third parties.

16. Debt securities in issue

	31 December	31 December
	2020	2019
	€ million	€ million
Securitizations		943
	-
Subordinated notes (Tier 2)	947	947
Covered bonds	-	500
Total	947	2,390

Pillar securitization

In June 2019, Eurobank Ergasias through its special purpose financing vehicle (SPV) 'Pillar Finance Designated Activity Company', issued asset backed securities (notes) of total value of ca. € 2 billion collateralized by a portfolio of primarily non performing residential mortgage loans (project Pillar), which were fully retained by the entity. The securitization notes consisted of € 1,044 million senior issued at par, € 310 million mezzanine issued at par and € 645 million junior of issue price € 1. In the same month, Eurobank Ergasias announced that it has entered into a binding agreement with Celidoria S.A R.L, an entity ultimately owned by funds whose investment manager is the global investment management firm Pimco, for the sale of 95% of the mezzanine and junior notes of the abovementioned securitization. Upon the completion of the transaction, in September 2019, Eurobank Ergasias ceased to have control over the SPV.

Cairo securitisation

In June 2019, Eurobank Ergasias, through its special purpose financing vehicles (SPVs) 'Cairo No. 1 Finance Designated Activity Company', 'Cairo No. 2 Finance Designated Activity Company' and 'Cairo No. 3 Finance Designated Activity Company', issued asset backed securities (notes) of total value of ca. € 7.5 billion, collateralized by a mixed assets portfolio of primarily non performing loans, which were fully retained by the entity. The securitization notes consisted of € 2,409 million senior issued at par, € 1,464 million mezzanine issued at par and € 3,633 million junior of issue price € 1.

In the context of Law 4649/2019 ('Hercules' – Hellenic Asset Protection Scheme) voted by the Greek parliament on 16 December 2019, the SPVs opted in for the state guarantee scheme. Specifically, the applications submitted by Eurobank Ergasias to the Ministry of Finance were approved on 23 July 2020 while the Guarantee deed was signed on 25 February 2021.

On 20 March 2020, the demerger of Eurobank Ergasias (renamed to Eurobank Holdings) through the hive down of the banking sector and the establishment of a new company-credit institution under the corporate name 'Eurobank S.A.' (Eurobank) was completed (note 4). At the aforementioned date, Eurobank assumed, inter alia 100% of the senior, 5% of the mezzanine and junior notes of the Cairo securitization of total fair value of € 2,425 million. The rest of the Cairo notes, i.e. 95% of the mezzanine and 95% of the junior notes, remained with Eurobank Holdings.

In December 2019, Eurobank Ergasias announced that it has entered into binding agreements with doValue S.p.A. for the sale of 20% of the mezzanine and 50.1% of the junior notes of the aforementioned Cairo securitization for a cash consideration of ca. € 14 million. Upon the completion of the transaction, in June 2020, Eurobank Holdings ceased to have control over the SPVs.

Finally, in June 2020, Eurobank Holdings, following the respective decision of the Board of Directors, proceeded to the contribution the Cairo notesretained, i.e. 75% of the mezzanine and 44.9% of the junior notes, of total fair value of ca. € 56 million to the Cyprusbased subsidiary "Mairanus Ltd" in exchange for its newly-issued shares.

A description of the accounting implications of the aforementioned transactions and events is provided in notes 4 and 11.

Tier 2 Capital instruments

In January 2018, Eurobank Ergasias issued Tier 2 capital instruments of face value of € 950 million, in replacement of the preference shares which had been issued in the context of the first stream of Hellenic Republic's plan to support liquidity in the Greek economy under Law 3723/2008. The carrying amount of the aforementioned instruments, which have a maturity of ten years (until 17 January 2028) and pay fixed nominal interest rate of 6.41%, that shall be payable semi-annually, as at 31 December 2020, amounted to € 947 million, including € 3 million unamortized issuance costs and € 0.2 million accrued interest. Their fair value, which was determined by using quotes for identical financial instruments in non-active markets, amounted to € 932 million.

17. Other liabilities

As at 31 December 2020, other liabilities amounting to € 1.6 million primarily consist of (a) 0.6 million accrued expenses, (b) € 0.5 million current payables to suppliers and (c) € 0.4 million Standard legal staff retirement indemnity obligations.

Standard legal staff retirement indemnity obligations

The Company provides for staff retirement indemnity obligation for its employees, who are entitled to a lump sum payment based on the number of years of service and the level of remuneration at the date of retirement, if they remain in the employment of the Company until normal retirement age, in accordance with the local labor legislation. The above retirement indemnity obligations typically expose the Company to actuarial risks such as interest rate risk and salary risk. Therefore, a decrease in the discount rate used to calculate the present value of the estimated future cash outflows or an increase in future salaries will increase the staff retirement indemnity obligations of the Company.

The movement of the liability for standard legal staff retirement indemnity obligations is as follows:

	2020	2019
	€ million	€ million
Balance at 1 January	46	43
Current service and interest cost (1)	1	4
of which continued operations	0.01	0.02
Past service cost and (gains)/losses on settlements	2	28
Remeasurements:
Actuarial (gains)/losses arising from changes in financial assumptions	0	4
Actuarial (gains)/losses arising from experience adjustments	(0)	1
Benefits paid	(2)	(34)
Hive down banking sector	(47)	-
Balance at 31 December	0.4	46

(1) For the year 2020, current service cost amounts to € 0.7 million and interest cost amounts to € 0.1 million (2019: € 3 million and € 1 million respectively).

The significant actuarial assumptions (expressed as weighted averages) were as follows:

	2020	2019
	%	%
Discount rate	0.5	0.9
Future salary increases	2.1	1.9

As at 31 December 2020, the average duration of the standard legal staff retirement indemnity obligation was 16 years (2019: 17 years).

A quantitative sensitivity analysis based on reasonable changes to significant actuarial assumptions as at 31 December 2020 is as follows:

An increase/(decrease) of the discount rate assumed, by 50 bps/(50 bps), would result in a (decrease)/ increase of the standard legal staff retirement obligations by (€ 0.03 million)/ € 0.03 million.

An increase/(decrease) of the future salary growth assumed, by 0.5%/(0.5%), would result in an increase /(decrease) of the standard legal staff retirement obligations by € 0.02 million/ (€ 0.02 million).

Voluntary Exit Schemes (VES)

In September 2020, Eurobank Holdings group launched a new VES for eligible units in Greece, which was offered to employees over a specific age limit. The new VES was implemented through either lump-sum payments or long term leaves during which the employees will be receiving a percentage of a monthly salary, or a combination thereof, and the cost refers almost in its entirety to Eurobank S.A. and its subsidiaries.

In 2020, an amount of € 2.7 million has been recognised in the Company's income statement (discontinued operations) relating to the additional cost for the VES that was launched by the Company in 2019.

18. Share capital and share premium

As at 31 December 2020, the par value of the Company's shares is € 0.22 per share (2019: € 0.23). All shares are fully paid. The movement of share capital, share premium and number of shares are as follows:

	Share	Share
	capital	premium	Number of
	€ million	€ million	issued shares
Balance at 1 January	853	8,056	3,709,161,852
Share capital decrease	(57)	-	-
Capitalization of taxed reserves	21	-	-
Balance at 31 December	816	8,056	3,709,161,852

Decrease of the share capital in kind

Following the above, on 28 July 2020, the Annual General Meeting of the Shareholders of the Company approved among others:

(a) the decrease of the share capital in kind with the decrease in the nominal value of each ordinary share issued by the Company by € 0.0155 and the distribution to its shareholders of shares issued by Cairo Mezz Plc, with a value corresponding to the value of the share capital decrease, i.e. 309,096,821 common shares issued by Cairo Mezz Plc, each common registered share of nominal value € 0.10, at a ratio of 1 share of Cairo Mezz Plc for every 12 shares of the Company already held (note 4), and
(b) the capitalization of taxed reserves amounting to € 20,400,390.19 for the purpose of rounding the new nominal value of each ordinary share issued by the Company.

Share options

In addition, the aforementioned Annual General Meeting of the shareholders of the Company:

(a) approved the establishment of a five year shares award plan, starting from 2021, in the form of stock options rights by issuing new shares with a corresponding share capital increase, awarded to executives (of the Management) and personnel of the Company and its affiliated companies. The maximum number of rights that can be approved will be 55,637,000 rights, each of which will correspond to one new share, i.e. in case all option rights are exercised up to 55,637,000 new common registered shares of the Company in total will be allocated, corresponding to 1.5% of the current paid share capital. The exercise price of each new share is equal to the nominal value of the share.
(b) authorized the Board of Directors of Eurobank Holdings to determine the remaining terms and conditions of the plan.

Treasury shares

According to paragraph 1 of Article 16c of Law 3864/2010, during the period of the participation of the HFSF in the share capital of the Company, the Company is not permitted to purchase treasury shares without the approval of the HFSF.

19. Reserves and retained earnings

	Statutory	Non-taxed	Fair value	Other	Retained	Total
	reserves € million	reserves € million	reserve € million	reserves € million	earnings € million	€ million


Balance at 1 January 2019	205	887	53	6,463	(11,979)	(4,371)
Net profit	-	-	-	-	31	31
Merger with Grivalia Properties REIC	9	-	-	549	332	890
Debt securities at FVOCI	-	-	409	-	-	409
Cash flow hedges	-	-	-	(5)	-	(5)
Actuarial gains/(losses) on post employment benefit
obligations, net of tax	-	-	-	(4)	-	(4)
Hybrid capital's dividend paid and buy back,
net of tax	-	-	-	-	(4)	(4)
Balance at 31 December 2019	214	887	462	7,003	(11,620)	(3,054)

Balance at 1 January 2020	214	887	462	7,003	(11,620)	(3,054)
Net profit	-	-	-	-	(1,512)	(1,512)

Capitalization of taxed reserves (note 18)	-	-	-	-	(21)	(21)
Debt securities at FVOCI	-	-	(189)	-	-	(189)
Cash flow hedges	-	-	-	7	-	7
Actuarial gains/(losses) on post employment benefit
obligations, net of tax	-	-	-	(0)	-	(0)
Hybrid capital's dividend paid and buy back,
net of tax	-	-	-	-	(0)	(0)
Hive down banking sector	-	-	(273)	34	239	-
Balance at 31 December 2020	214	887	-	7,045	(12,915)	(4,769)

As at 31 December 2020, other reserves mainly comprise: (a) € 5,579 million, pursuant to the corporate law in force (currently article 31 of Law 4548/2018), which can be only either capitalized or offset against losses carried forward (2019: € 5,579 million), and (b) € 1,126 million, also pursuant to the corporate law in force (currently article 35 of Law 4548/2018), which is not distributable, but it can be either capitalized or offset against losses carried forward to the extent that these losses cannot be covered by designated reserves or other company funds for which loss absorption is provided in the corporate law (2019: € 1,126 million).

Statutory reserves, are not distributable, while non-taxed reserves are taxed when distributed.

Dividends

Based on the 2020 accounts, pursuant to the Company Law 4548/2018, the distribution of dividends is not permitted. Furthermore, under the provisions of the Tripartite Relationship Agreement between Eurobank Holdings, the Bank and the HFSF (signed 23.3.2020) and article 10 par.3 of Law 3864/2010 for the "establishment of a Hellenic Financial Stability Fund", for as long the HFSF participates in the share capital of Eurobank Holdings, the amount of dividends that may be distributed to shareholders of either Eurobank Holdings or the Bank cannot exceed 35% of the profits as provided in article 161 par. 2 of Company Law 4548/2018.

20. Hybrid capital

On 23 January 2020, a notice for the redemption of the remaining preferred securities of series A was given to the holders and on 18 March 2020, the aforementioned notes of face value of € 1.6 million were redeemed. In addition, for the year ended 31 December 2020, ERB Hellas Funding Ltd declared and paid for Series A of preferred securities in accordance with its terms and following the redemption of the Greek State – owned preference shares (note 16) on 17 January 2018, the non-cumulative dividend of € 11 thousand.

21. Cash and cash equivalents

For the purpose of the cash flow statement, cash and cash equivalents comprise the following balances with original maturities of three months or less:

	31 December	31 December
	2020	2019
	€ million	€ million
Cash and balances with central banks (excluding
mandatory and collateral deposits with central banks)	-	2,626
Due from credit institutions	14	146
Securities held for trading	-	1
Total	14	2,773

22. Post balance sheet events

Details of post balance sheet events are provided in the following notes:

Note 2.1 - Basis of preparation Note 25 – Board of Directors

23. Related parties

On 20 March 2020, Eurobank Ergasias S.A. ("Demerged Entity") announced that its demerger through the banking sector's hive down and the establishment of a new company-credit institution ("Demerger") under the corporate name "Eurobank S.A." ("Bank") was approved, while on 23 March 2020 the Demerged Entity was renamed to "Eurobank Ergasias Services and Holdings S.A." ("Company" or "Eurobank Holdings") (note 4). Following the above, the key management personnel (KMP) of the Demerged Entity remained as the Bank's KMP. Furthermore, the Board of Directors (BoD) of Eurobank Holdings is the same as the BoD of the Bank and part of the KMP of the Bank provides services to Eurobank Holdings according to the terms of the relevant agreement between the two entities. As at 31 December 2020, the percentage of the Company's ordinary shares with voting rights held by the Hellenic Financial Stability Fund (HFSF) stands at 1.40%. The HFSF is considered to have significant influence over the Company pursuant to the provisions of the Law 3864/2010, as in force, the Relationship Framework Agreement (RFA) the Demerged Entity has entered into with the HFSF on 4 December 2015 and the Tripartite Relationship Framework Agreement (TRFA) between the Bank, the Company and the HFSF signed on 23 March 2020. Further information in respect of the HFSF rights based on the aforementioned framework is provided in the section "Report of the Directors and Corporate Governance Statement" of the Annual Financial Report for the year ended 31 December 2020.

In addition, as of December 2019, Fairfax Financial Holdings Limited has obtained the required regulatory approvals in relation to the increase of its shareholding in the Demerged Entity, which arose from the merger of the latter with Grivalia Properties REIC in the same year. Accordingly Fairfax group, which as at 31 December 2020 holds 31.27% in the Company's share capital, is considered to have significant influence over the Company. For the year ended 31 December 2020, the net income arising from the Company's activities with Fairfax group amounted to € 1.1 million. As at 31 December 2019, the Company's outstanding balances of the transactions with Fairfax group mainly refer to loans granted of € 0.02 million, deposits received of € 3.7 million and guarantees issued of € 0.4 million.

A number of transactions are entered into with related parties in the normal course of business and are conducted on an arm's length basis. The outstanding balances of the transactions with: (a) the subsidiaries, (b) the key management personnel (KMP) and the entities controlled or jointly controlled by KMP and (c) the associates and joint ventures, as well as the relating income and expenses from continuing and discontinued operations are as follows:

	31 December 2020
		KMP (1) and
		Entities
		controlled or
		jointly
		controlled by	Associates and
	Subsidiaries (2)	KMP	joint ventures
	€ million	€ million	€ million
Due from credit institutions	14.39	-	-
Investment securities	941.85	-	-
Other assets	0.74	-	-
Other liabilities	0.37	-
Net interest income	34.32	-	(1.10)
Net banking fee and commission income	(3.52)	-	4.02
Net trading income	0.50	-	-
Other operating income/(expense) (4)	1.41	(3.12)	(4.84)
Other Impairment losses and
provisions (note 13)	(8.32)	-	-
Impairment losses relating to loans and
advances and collectors' fees	(3.63)	-	(0.17)

		31 December 2019
		KMP (1) and
		Entities
		controlled or
		jointly
		controlled by	Associates and
	Subsidiaries	KMP	joint ventures
	€ million	€ million	€ million
Due from credit institutions (3)	752.25	-	-
Securities held for trading	0.62	-	-
Derivative financial instruments assets	19.24	-	-
Loans and advances to customers	1,435.85	6.16	11.60
Other assets	10.89	-	9.80
Due to credit institutions	3,432.26	-	-
Derivative financial instruments liabilities	2.03	-	-
Due to customers	294.24	13.86	46.83
Other liabilities	294.99	-	3.21
Guarantees issued	598.45	0.01	2.00
Guarantees received	-	0.03	-
Net interest income	(4.47)	0.01	(4.25)
Net banking fee and commission income	(0.59)	-	18.09
Dividend income	130.00	-	11.00
Net trading income	(0.47)	-	0.25
Other operating income/(expense) (4)	8.96	(7.61)	(22.81)
Other Impairment losses and provisions	(30.00)	-	-
Impairment losses relating to loans and
advances and collectors' fees	(44.66)	-	(4.79)

(1) Includes the key management personnel of the Company and their close family members.

(2) Equity contributions and other transactions with subsidiaries are presented in note 14.

(3) Furthermore as of 31 December 2019, € 0.7 billion guarantees have been issued relating mainly to the lending activities of banking subsidiaries for which the equivalent pledged amount is included above in "Due from credit institutions"

(4) For the year ended 31 December 2020, the amount of € 3.12 million (2019: 7.61 million) relates to the services agreement with Grivalia Management Company S.A. for the management of the Company's real estate properties until the hive down date (note 4).

Key management compensation (directors and other key management personnel of the Company)

Following the completion of the banking sector's hive down of Eurobank Ergasias S.A., the Company recognizes KMP compensation referring mainly to KMP services provided by Eurobank S.A. in accordance with the relevant agreement. The Key management compensation for the year ended 31 December 2020 (mainly referring to the compensation of Eurobank Ergasias KMP for the pre hive down period) comprises short-term employee benefits of € 1.51 million (2019: € 6.42 million), long-term employee benefits of € 0.24 million (2019: € 1.01 million), while the cost recognized in the income statement relating to the defined benefit obligation for the KMP amounts to € 0.02 million (2019: € 0.29 million cost through the income statement and € 0.17 million actuarial loss through the other comprehensive income).

24. External Auditors

The Company has adopted a Policy on External Auditors' Independence which provides amongst others, for the definition of the permitted and non-permitted services the Company's auditors may provide further to the statutory audit. For any such services to be assigned to the Company's auditors there are specific controlling mechanisms in order for the Company's Audit Committee to ensure there is proper balance between audit and non-audit work.

The total fees of the Company's independent auditor "KPMG Certified Auditors" for audit and other services provided are analyzed as follows:

	2020	2019
	€ million	€ million

Statutory audit (1)	(0.2)	(1.1)
Tax certificate	(0.0)	(0.2)
Other audit related assignments	(0.4)	(0.3)
Non audit assignments	-	(0.1)
Total	(0.6)	(1.7)

(1) Includes fees for statutory audit of the Company's annual financial statements.

It is noted that there are no non-audit assignment fees of "KPMG Certified Auditors A.E." Greece, statutory auditor of the Company.

25. Board of Directors

Further to that:

Mr. Theodoros Kalantonis, submitted his resignation, effective as of 3 April 2020.
The BoD by its decision dated 8 April 2020, appointed Ms. Alice Gregoriadi and Ms. Irene Rouvitha Panou as their new independent non-executive members, in replacement of the resigned independent non-executive members Mr. Richard Boucher and Mr. Nikolaos Bertsos, their resignations being effective as of 8 April 2020, and their term of office will expire concurrently with the term of office of the other members of the BoD.
Mr. George Μyhal, submitted his resignation, effective as of 10 December 2020. The BoD by its decision the same date appointed Ms. Cinzia Basile as new independent Non-Executive Director, in replacement of the resigned independent nonexecutive member Mr. George Myhal for an equal term to the remaining term of the resigned member.
The BoD by its decision dated 10 December 2020 appointed Mr. Andreas Athanasopoulos as new executive Director in replacement of the resigned executive Director Mr. Theodoros Kalantonis for an equal term to the remaining term of the resigned member.
The BoD by its decision dated 28 January 2021, appointed Ms Efthymia Deli as the new representative of the HFSF and non-executive member of Eurobank Holdings BoD in replacement of the departing Mr. Dimitrios Miskou, according to the provisions of Law 3864/2010 and the existing Relationship Framework Agreement with the HFSF (TRFA), for an equal term to the remaining term of the resigned member.

Following the above, the BoD is as follows:

G. Zanias	Chairman, Non-Executive
G. Chryssikos	Vice Chairman, Non-Executive
F. Karavias	Chief Executive Officer
S. Ioannou	Deputy Chief Executive Officer
K. Vassiliou	Deputy Chief Executive Officer
A. Athanasopoulos	Deputy Chief Executive Officer
B.P. Martin	Non-Executive Independent
A. Gregoriadi	Non-Executive Independent
I. Rouvitha- Panou	Non-Executive Independent
R. Kakar	Non-Executive Independent
J. Mirza	Non-Executive Independent
C. Basile	Non-Executive Independent
E. Deli	Non-Executive (HFSF representative under Law 3864/2010)

Athens, 12 April 2021

Georgios P. Zanias Fokion C. Karavias Harris V. Kokologiannis I.D. No AI - 414343 I.D. No ΑΙ - 677962 I.D. No AN - 582334 CHAIRMAN CHIEF EXECUTIVE OFFICER GENERAL MANAGER OF GROUP FINANCE OF THE BOARD OF DIRECTORS GROUP CHIEF FINANCIAL OFFICER

^VΙΙ. Website Address for Information on consolidated non-listed companies of the Company

The website address, where the annual financial statements for the year ended 31.12.2020 are uploaded, as well as the independent Auditors' reports and the Board of Directors' Reports of the entities, which are consolidated and not listed and which represent accumulatively more than 5% of the consolidated turnover or of the assets of the consolidated balance sheet or of the consolidated results after subtracting the proportion of minority shares, is: www.eurobankholdings.gr

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Eurobank Ergasias Services and Holdings S.A.

2644_10-k_2021-04-15_46a2e407-da37-485b-a6d8-4a821bf01052.pdf

EUROBANK ERGASIΑS SERVICES AND HOLDINGS S.A.

FOR THE YEAR ENDED

Table of Contents

Statements of Members of the Board of Directors (according to the article 4 par. 2 of the Law 3556/2007)

General information

Financial Results Review and Outlook1

Profit or Loss

Capital adequacy

European Union (EU) – wide stress test

Corporate Transformation-Hive down

Hive down

Response to the impact of the covid-19 crisis

1. Customer support measures

a. Covid-19 relief measures ('moratoria')

b. Government support measures

c. Operational capacity

d. Utilization of digital channels and provision of covid-19 focused products and services

2. Employees protection measures

3. Support the Public Health System

International Activities

Risk management

Credit Risk

Market Risk

Liquidity Risk

Operational Risk

Non Performing Exposures (NPEs) management

Troubled Assets Committee

Remedial and Servicing Strategy (RSS)

Operational targets for Non-Performing Exposures (NPEs)

Legal Framework

Macroeconomic Outlook and Risks

Share Capital

Share options

Dividends

Major Shareholders

Board of Directors

Further to that:

Sundry information required under Law 3556/2007 (article 4, par.7)

Information required under Law 4548/2018 (article 97, par.1 (b))

External Auditors

Non financial information

Business model

Materiality Analysis

Employee Engagement

Learning, Personal and Professional Development

Development and Performance Evaluation system "Axiopoio"

Improving Employee Experience

Strengthening Dialogue & Information

Support at work - HR4U

Recognizing and Rewarding Employees

Labour Unions

Corporate Social Responsibility

Supporting society /Supporting society against Covid-19 pandemia

Education and excellence

Access to financial services for all /Financial inclusion

Digital literacy and inclusion

Supporting entrepreneurship and innovation

Protection of environment

Actions against corruption and bribery incidents

Related party transactions

Corporate Governance Statement

APPENDIX

Definition of capital and other selected ratios in accordance with the regulatory framework, which are included in the Report of Directors/Financial Statements:

Source of financial Information

CORPORATE GOVERNANCE STATEMENT 2020

1. Demerger of Eurobank Ergasias S.A.

Given that the Group consists mainly of Eurobank group, the present Corporate Governance Statement outlines how the principles stipulated by the Code were applied to Eurobank Holdings and Eurobank during 2020.

2. Corporate Governance Code and Practices

3. Board of Directors1

3.1 General

3.2 Composition of the Board

Eurobank Holdings

Eurobank

Further to that:

3.3 HFSF and Tripartite Relationship Framework Agreement (TRFA)

3.4 Division of responsibilities

3.5 Operation of the Board

Financial Results Review and Outlook¹

4.1 Audit Committee²

Executive Board¹⁰

Management Risk Committee¹²