Unipol — Investor Presentation 2019

Mar 15, 2019

UNIPOL – UNIPOLSAI PRESENTATION

Bologna, 15 March 2019

2016-2018 TARGETS ACHIEVED

SALE OF UNIPOL BANCA AND NPL DEAL

APPENDIX

NOTICE

The bases of consolidation of Unipol and UnipolSai in FY18 were slightly different compared to FY17, namely:

• Popolare Vita was part of Unipol and UnipolSai until 1Q18 only;
• UniSalute and Linear, which were directly controlled by Unipol until 9M17, were included in UnipolSai perimeter in FY18;
• Arca Vita, which was directly controlled by Unipol until 1H18, was included in UnipolSai perimeter starting from 3Q18.

For a more useful comparison of the figures in this presentation:

• the normalised figures have been adjusted to exclude the impact of the extraordinary operations;
• the adjusted figures are normalised figures recalculated to reflect also the current perimeter.

CONSOLIDATED RESULTS

€m

	UNIPOL					UNIPOLSAI
	FY17 reclassified a	FY18	FY17 adjusted	FY18		FY17 actual	FY18	FY17 adjusted	FY18
Consolidated pre-tax result a	-179	886	824	903	Consolidated pre-tax result	760	1,203	933	969
Non-Life	687	730	687	727	Non-Life	501	676	693	733
Life	328	621	248	299	Life	286	593	268	302
Banking a	-987	-299	16	43
Holding and other	-207	-166	-127	-166	Other	-27	-66	-28	-66
Consolidated net result	-169	628	598	645	Consolidated net result	537	948	690	703
Group net result	-346	401	409	472	Group net result	504	905	664	657

FY17 and FY18 results were impacted by changes in the perimeter and extraordinary items detailed in the next slide

^aIn accordance with IFRS 5, "discontinued operations" are reported as a single item ("Profit and loss from discontinued operations") in the statement of profit and loss, net of taxes. However, in these tables, for comparative purposes we have included the impact of the banking business currently in the process of being sold within the pre-tax consolidated figures

ACTUAL AND ADJUSTED CONSOLIDATED RESULTS

€m

777

NON-LIFE DIRECT PREMIUM INCOME

€m

Premiums by company	FY17	FY18	var. %
UnipolSai S.p.A.	6,901	6,898	--
UniSalute	371	410	+10.5%
Linear	172	180	+4.4%
Incontra	107	136	+27.1%
Arca Assicurazioni	110	120	+9.2%
Other companies	205	209	+1.8%
Total premium income	7,867	7,953	+1.1%

FY18 adj. premiums	breakdown
Motor Vehicles	52%
Accident and Health	17%
Property	15%
General TPL	9%
Other	7%

UnipolSai acquired UniSalute and Linear in 4Q17 and Arca in 3Q18 Adjusted figures include UniSalute, Linear and Arca in both FY17 and FY18 Operating figures

NON-LIFE COMBINED RATIO NET OF REINSURANCE

UnipolSai acquired UniSalute and Linear in 4Q17 and Arca in 3Q18

Adjusted figures include UniSalute, Linear and Arca in both FY17 and FY18

Combined ratio net of reinsurance: operating expenses/earned premiums after reinsurance+claims charges/earned premiums after reinsurance

UNIPOLSAI S.P.A. – MV TPL TECHNICAL INDICATORS DIRECT BUSINESS

UNIPOLSAI S.p.A.

MV TPL Combined Ratio	FY17	FY18
Direct Business	97.7%	95.4%
ratio a Expense	22.7%	21.8%
commissions/premiums	13.6%	12.8%
other operating
expenses/premiums	9.1%	9.0%
ratio b Loss	75.1%	73.7%

No. of black boxes 3.8 million (41% of the retail portfolio)

Other MV TPL indicators	Var. vs FY17
Total portfolio policies	+0.1%
Retail (95% of tot ptf)	-0.1%
Fleets (5% of tot ptf)	+3.4%
Portfolio average premium	-1.6%
No. of claims reported (followed-up managed claims)	-5.0%
Frequency	-0.23pp

^a Operating expenses / written premiums from direct business (before reinsurance) ^b Claims charges / earned premiums from direct business (before reinsurance) Operating figures

FOCUS ON UNISALUTE, LINEAR, INCONTRA, ARCA

€m

IAS net result	40.3
Loss ratio	79.0%
Expense ratio	11.4%
CoR direct business	90.4%
Premium income	410
	FY18
UNISALUTE

LINEAR
	FY18
Premium income	180
CoR direct business	96.7%
Expense ratio	19.8%
Loss ratio	76.9%
IAS net result	9.4

INCONTRA
	FY18
Premium income	136
CoR direct business	53.7%
Expense ratio	40.9%
Loss ratio	12.8%
IAS net result	6.8

ARCA ASSICURAZIONI
	FY18
Premium income	120
CoR direct business	70.3%
Expense ratio	36.6%
Loss ratio	33.8%
IAS net result	29.8

LIFE DIRECT INCOME

€m

Premiums by company	FY17	FY18	var. %
UnipolSai S.p.A.	2,892	3,129	+8.2%
Arca Vita + AVI	711	1,077	+51.4%
Other companies	115	86	-25.5%
Total premium income	3,719	4,292	+15.4%

FY18 adj. premiums breakdown
Traditional	64%
Unit linked	12%
Pension funds	15%
Capitalization	9%

UnipolSai acquired Arca in 3Q18. The sale of Popolare Vita was finalized in 1Q18 Adjusted figures include Arca and exclude Popolare Vita for all FY17 and FY18

LIFE SEGREGATED ACCOUNTS AND MINIMUM GUARANTEED YIELDS

a Technical Reserves	FY17	FY18
Min. guar. yield
0%-1%	36%	45%
1%-2%	35%	29%
2%-3%	21%	19%
>3%	8%	7%

Figures include Arca and exclude Popolare Vita for all FY17 and FY18 ^a Class 1 and class 5 technical reserves Operating figures

BANKING BUSINESS KPIs

€m

	1Q18	FY18					FY17 act.	FY17 adj.	FY18 act.
Direct deposits	11,064	10,084						a
Indirect deposits	50,937	48,552		Gross	operating	income	348	340	373
a Net loans	6,956	6,983			o/w interest income		203	a 203	206
					o/w non-interest income		145	138 a	167
Unipol CET1 ratio					Pre-tax result		-987 c	16 b, c	43
(fully loaded)		30.5%			Net result		-747	b 16	33
NPEs				1Q18				FY18
			net loans	gross loans	coverage ratio	net loans		gross loans	coverage ratio
Bad loans (Sofferenze)			26	116	77%		27	96	72%
Unlikely to pay			392	710	45%	341		634	46%
Past due			75	89	16%		37	44	17%
Total NPEs			494	915	46%	405		e 774	48%

The "Banking Business" is comprised of Unipol Banca and Finitalia – Operating figures

For a more useful comparison the FY18 balance sheet figures have been compared with the 1Q18 figures following the spin-off of UnipolReC. ^a Like-for-like figures

^b Excluding the impact of the restructuring of the banking business

c Including 8 €m of contribution to national banking funds (FNR and FITD)

^d FNR (Fondo Nazionale di Risoluzione) and FITD (Fondo Interbancario di Tutela Depositi)

^e Total gross loans to customers (Unipol Banca consolidated) net of financial assets measured at amortized cost equal to €8.1bn

NPE BUSINESS – UNIPOL REC

€m

		1 Feb 18 a			FY18
NPEs TREND	net loans	gross loans	coverage ratio	net loans	gross loans	coverage ratio
Bad loans (Sofferenze)	553	2,900	81%	490	2,590	81%
Unlikely to pay	0	0		0	0
Past due	0	0		0	0
Total NPEs	553	2,900	81%	490	2,590	81%

NPEs highlights (1 Feb–31 Dec)	Collections /GBV
Bad loans (GBV reduction)	311
Collections	95	31%

ASSET ALLOCATION

FINANCIAL INVESTMENT YIELDS

	FY18 act.
	Non-Life		Life		Total
	€m	Yield	€m	Yield	€m	Yield
Coupons and dividends	428	3.4%	1,196	3.4%	1,629	3.3%
Realized and unrealized gains/losses	43	0.3%	167	0.5%	210	0.4%
Total	472	3.7%	1,362	3.9%	1,839	3.8%

UNIPOL UNIPOLSAI

	FY18 act.
	Non-Life			Life	Total
	€m	Yield	€m	Yield	€m	Yield
Coupons and dividends	424	3.4%	1,089	3.5%	1,513	3.4%
Realized and unrealized gains/losses	43	0.3%	164	0.5%	207	0.5%
Total	467	3.7%	1,254	4.0%	1,721	3.9%

				FY18 adj.							FY18 adj.
		Non-Life		Life		Total			Non-Life		Life	Total
	€m	Yield	€m	Yield	€m	Yield		€m	Yield	€m	Yield	€m	Yield
Total	472	3.7%	1,320	4.0%	1,796	3.8%	Total	472	3.7%	1,320	4.0%	1,791	3.9%

Adjusted figures exclude Popolare Vita and, with respect to UnipolSai, include Arca Vita for all FY18

REAL ESTATE

UNIPOL – Tot. portfolio 4.0 €bn

^a No. 169 deeds as at 31 December 2018 b Including exchange variation and operations on RE funds and associated SPV Operating figures

DIVIDEND PROPOSAL

€m

SOLVENCY

€bn

UNIPOL (consolidated) PARTIAL INTERNAL MODEL

UNIPOLSAI (consolidated) ECONOMIC CAPITAL

UNIPOLSAI (solo) PARTIAL INTERNAL MODEL

Figures net of dividend distribution proposal

SOLVENCY – OWN FUNDS AND SCR DETAILS

€bn

21

2016-2018 TARGETS ACHIEVED

2016-2018 TARGETS ACHIEVED

2016-2018 STRATEGIC PLAN: RESULTS VS. OBJECTIVES

SOLVENCY 163% partial internal model SOLVENCY 202% economic capital

Target 120%-160% set on standard formula+USP

Target 150%-200% set on standard formula+USP

FY17 excluding the impact of the restructuring of the banking business; FY18 excluding the gain from Popolare Vita sale and the write-down of Unipol Banca shareholding

2016-2018 TARGETS ACHIEVED

SHAREHOLDERS' TOTAL RETURN

12 May 2016 ^a – 13 March 2019

SALE OF UNIPOL BANCA AND NPL DEAL

Acquisition by UnipolReC, for cash, of a portfolio of non-performing loans from BPER

• with a gross book value of 1.3 €bn
• at a price of 130 €m (equivalent to 10% of Gross Book Value)
• of which 32% secured, 68% unsecured

APPENDIX

APPENDIX

GROUP STRUCTURE

On 7 February 2019 the BoD of Unipol and UnipolSai approved the sale of Unipol Banca to BPER Banca, subject to obtaining the necessary authorisations

^aIncluding the shares held by Unipol Finance, Unipol Investment and UnipolPart I ^b After the excercise of the put option (March 2019) on 27.49% of Unipol Banca and UnipolReC capital

APPENDIX

KEY PERFORMANCE INDICATORS

€m

UNIPOL			UNIPOLSAI
	FY17	FY18
Consolidated net result	-169	628
Consolidated adj. net result	598	645
Group net result	-346	401
EPS (€)	n.s.	0.56
Group adj. net result	409	472
Adj. EPS (€)	0.57	0.66
Dividends	129	129
DPS (€)	0.18	0.18
Premium income direct business	12,291	12,349
o/w Non-Life	7,867	7,953
o/w Life	4,424	4,396
Combined Ratio net of reins.	96.4%	94.2%
Total equity	7,453	6,327
Shareholders' equity	5,486	5,032
BVPS (€)	7.65	7.01

	FY17	FY18
Consolidated net result	537	948
Consolidated adj. net result	690	703
Group net result	504	905
EPS (€)	0.18	0.32
Group adj. net result	664	657
Adj. EPS (€)	0.23	0.23
Dividends	410	410
DPS (€)	0.145	0.145
Premium income direct business	11,068	11,718
o/w Non-Life	7,355	7,892
o/w Life	3,713	3,826
Combined Ratio net of reins.	97.2%	94.3%
Total equity	6,194	5,697
Shareholders' equity	5,869	5,448
BVPS (€)	2.07	1.93

DISCLAIMER

Maurizio Castellina, Senior Executive responsible for drawing up the corporate accounts of Unipol Gruppo S.p.A. and UnipolSai Assicurazioni S.p.A., declares, in accordance with Article 154-bis, para 2, of the 'Consolidated Finance Act', that the accounting information reported in this document corresponds to the document contents, books and accounting records.

This document has been prepared by Unipol Gruppo S.p.A. and by UnipolSai Assicurazioni S.p.A. solely for information purposes in the context of the presentation of their FY18 results. The content of this document does not constitute a recommendation in relation to any financial instruments issued by the companies of the Unipol Group, nor it constitutes or forms part of any offer or invitation to sell, or any solicitation to purchase any financial instruments issued by the companies of the Unipol Group, nor it may be relied upon for any investment decision by its addressees. Unless otherwise specified all the figures reported in this presentation are on a consolidated basis.

INVESTOR RELATIONS CONTACTS

Adriano Donati

Head of Investor Relations

Tel +39 051 507 7063 investor.relations@unipol.it investor.relations@unipolsai.it

Giancarlo Lana	Tel +39 011 665 7088
Eleonora Roncuzzi	Tel +39 051 507 7063
Carlo Latini	Tel +39 051 507 6333
Giuseppe Giuliani	Tel +39 051 507 7218
Silvia Tonioli	Tel +39 051 507 2371
Colm Begley	Tel +39 051 507 7837