Cementir N : Credem complies with ECB recommendations on dividend distribution. Group CET1 RATIO increased at 15.3%

CREDEM COMPLIES WITH ECB RECOMMENDATIONS ON DIVIDEND DISTRIBUTION. GROUP CET1 RATIO INCREASED AT 15.3%

€1 BILLION RELEASED FOR NEW POTENTIAL LOANS, IN ADDITION TO THE ALREADY ANNOUNCED €7 BILLION, IN ORDER TO BE CLOSER TO CUSTOMERS AND TO SUSTAIN THE ECONOMIC RECOVERY

• The Board of Directors, following ECB recommendations and in light of the Italian current economic and health situation, withdrew the dividend proposal of €0.22 per share, allocating 2019 net income to extraordinary reserve;
• the Group, among the soundest in Europe, furtherly improved its capital position with a Banking Group FY19 CET1 Ratio at 15.3%, up by 49 bps;
• Credem confirmed its responsibility and its commitment to support the recovery of Italian economy even in adverse scenarios, as constantly done in the last 10 years. Indeed, thanks to a forward-lookingdividend payout, the bank has continued to sustain families and corporates, with loans growing over €9 billion (up by more than 50%);
• leveraging the investments made in the last few years, the Group put in place all the necessary actions to continue to support customers, remaining fully operating, and to protect its people, promoting the use of digital channels and extending smart working to over 85% of the workforce.

Today Credem Board of Directors decided to withdraw the proposal regarding the dividend distribution of €0.22 per share, allocating 2019 net income to extraordinary reserve, following ECB recommendations (ECB/2020/19) after COVID-19epidemic. The Board postponed any further decision to a future Shareholders Meeting, that will be held after 1 October 2020 or, in any case, when uncertainties generated by COVID-19end.

In this regard, the Board of Directors wishes to thank all the bank's Shareholders for constantly supporting the organic growth of the Group. Shareholders are now called to responsibly conform to the ECB recommendations, although it is to be remarked being the dividend proposal already prudent compared to the relevant economic results achieved in 2019 and fully consistent with the maintenance of the Group's sound capital position. Indeed, the well-known Group capital soundness was recently reaffirmed by ECB, that required

Credem to maintain the lowest additional capital requirement among European commercial banks under direct ECB supervision; moreover, the Group has always shown a forward-looking approach in allocating the majority of its profits to support loan growth and the Italian economy.

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Following this decision, Banking Group consolidated capital ratios strengthened furtherly, with FY19 CET1 ratio that reached 15.3%, increasing by 49 bps1.

The additional capital, deriving from the allocation of 2019 net income to reserves, represents the equivalent of €1 billion of new potential disbursements of loans. Therefore, the recent credit facilities put in place by the Group to support families and corporates grew, reaching over €8 billion and helping the bank to furtherly contribute to the recovery of the Italian economy. On top of that, it is to be remarked that the Group has constantly and materially supported the economy of the Country in the last 10 years, during which it has never failed to provide its contribution to support customers, with loans growing by more than 50%.

Credem will carefully examine future ECB recommendations on dividends distribution and it is confident that, when uncertainties caused by Covid-19 end, it will be able to call for a new Shareholders' Meeting and propose the distribution of withdrawn dividends, now prudentially allocated to reserves. In any case, the Group has always showed a prudential dividend payout, in line with its mission of creating value over time, despite managing to constantly distribute dividends in the last 10 years for a total of €500 millions, without any need to perform capital increases.

Since the beginning of the crisis, Credem responsively implemented a large number of initiatives to be close to families and corporates and to protect health and safety of employees and customers:

• loans and credit lines payments suspension (moratorium), provided by the Legislative Decree Cura Italia to micro, small and medium-sized companies;
• accession to the ABI Credit Agreement for SME companies, that the Group voluntarily extended to all corporates, including larger ones;
• activation of a remote service to collect suspension requests of loans, mortgages, and credit facilities provided for by the DL Cura Italia or by the ABI Agreement via email or PEC;
• allocation of a of pre-approved loans plafond for SMEs to obtain additional liquidity for payments, salaries and other needs of the production cycle;
• access to the solidarity fund for first-home loans holders, therefore allowing the suspension of the amortization plan up to 18 months;
• allocation of personal loans aimed at financing personal or family needs, or of credit lines on credit cards to meet small financing needs for private customers;
• Credemassicurazioni, the non-life insurance company (owned 50% by Credem Group and 50% by Reale Mutua Assicurazioni), expanded its coverage in favor of 90 thousand subscribers of policies. The latter provide daily hospitalization compensation and extend

1 In case of a similar decision by Credemholding, the increase in regulatory capital ratios, given the effect of the regulatory calculation of "minorities", will be equal to 22 bps with a FY19 CET1 ratio of 13.74%

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without any formality the guarantee even in case of quarantine at home, imposed by a positive result in Coronavirus test (COVID-19), since the beginning of the emergency;

• minimized the occasions of direct contact between customers and branches staff by managing meetings through digital tools (such as the extension to all customers of video call services and web collaboration, allowing clients to receive advice on products and services even remotely and with any device);
• the significant investments in technology and innovation, made during last years, allowed a considerable increase in the use of smart working, that passed from 2 thousand people (over 30% of the workforce) for 2 days a week at the end of 2019 week to over 5,400 people at the end of March 2020 (over 85% of employees), up to 5 days a week: in doing so, within few hours thousands of private homes were transformed into bank governance and customer relationship centers. Via Internet banking, remote working, video calls and contact center, all essential customer services were ensured remotely. At same time, such measures allowed branches to be less crowded and therefore safer, and only used for urgent matters.

Finally, the Board of Directors wants to express sincere thanks especially to the cashiers and all the professionals who continue to be at the forefront, remaining available for customers; the Board is proud of what people have been able to achieve in such a difficult scenario, because it is in these moments that the values of the companies and of the individuals working in them are measured.

In accordance with paragraph 2 of Article 154-bis of the Consolidated Law on Finance (D. Lgs. 58/98 "Testo Unico delle disposizioni in materia di intermediazione finanziaria"), the Financial Reporting Manager Paolo Tommasini declares that the accounting information, both individual and consolidated, contained in this press release corresponds to document results, books and accounting records.

Reggio Emilia, April 9, 2020

CREDITO EMILIANO SPA

(Chairman)

Lucio Igino Zanon di Valgiurata

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