Aareal Bank : Analysts' call on the 2022 Q3 figures

Analyst Conference Call

Q3 2022 results

November 10, 2022

Jochen Klösges (CEO)

Marc Hess (CFO)

Agenda

• Highlights
• Group results
• Segments
• Funding & Capital
• Outlook
• Appendix

1

Highlights

Ongoing strong operating performance in Q3 despite LLP on Russian exposure

Q3 operating profit increased by 32% to € 66 mn,

1 despite additional LLP of € 43 mn on remaining Russian exposure

2 Strong earnings momentum:

Q3 NII increased by 19% (yoy), NCI up by 20%

1. Strict cost discipline, strategy of growth at low marginal cost successfully executed, CIR of banking business further reduced to 39%
   2022 capital market funding plan already fulfilled
2. CET1 ratio (19.4%) remains at a comfortable level

5 Operating profit outlook 2022 confirmed1),

despite 9M-LLP on Russian exposure and negative impact of ECB's decision on TLTRO in Q4

6 Investors expect completion of qualifying holding procedure in spring 2023

1. Developments in the macroeconomic environment remain uncertain

2

Agenda

• Highlights
• Group results
• Segments
• Funding & Capital
• Outlook
• Appendix

3

Group Results

Strong earnings momentum offsetting additional LLP on remaining Russian exposure

€ mn	Q3 '21	Q4 '21	Q1 '22	Q2 '22	Q3 '22	9M '21	9M '22	9M Comments
								Significant increase of 18% mainly driven by
Net interest income	155	162	159	171	184	435	514	portfolio growth and first positive effects of
								higher interest rates
Loss allowance	39	54	49	58	63	79	170	LLP dominated by additional provision on
remaining Russian exposure (9M: € 126 mn)
Net commission income	56	71	64	68	67	174	199	Both Aareon and BDS contribute to 14%
increase
Derecognition result	7	8	9	13	2	15	24	Includes positive effects of elevated
FV- /hedge-result	-5	-24	2	9	5	-11	16	market volatility
Admin expenses	125	135	153	142	128	393	423	Reflects investments in Aareon growth.
Bank largely stable despite PTO one-offs
Others	1	4	-2	0	-1	-18	-3
Operating profit (EBT)	50	32	30	61	66	123	157	Strong earnings momentum offsetting
add. LLP on remaining Russian exposure
Income taxes	27	20	11	22	24	67	57
Minorities	0	-1	1	0	-1	2	0
AT1	3	4	3	4	4	10	11
Consolidated net income	20	9	15	35	39	44	89
allocated to ord. shareholders
Earnings per share (€)	0.33	0,16	0.25	0.59	0.65	0.73	1,49
RoE after taxes (%)1) 2)						2.3	4.3
Cost/income ratio (%)3)	45	52	43	39	35	50	39	Successful execution of growth at low
marginal cost strategy

4

1) The allocation of earnings is based on the assumption that net interest payable on the AT1 bond is recognised on an accrual basis

2) Annualized

3) Structured Property Financing and Banking & Digital Solutions (excl. bank levy and contributions to the deposit guarantee scheme)