Banca Carige S p A Cassa di Risparmio di Genova e Imperia : BoD approves consolidated results as at 31 March 2021

PRESS RELEASE

BANCA CARIGE'S BOARD OF DIRECTORS APPROVES

CONSOLIDATED RESULTS AS AT

31 MARCH 20211

• THE NET RESULT FOR THE FIRST QUARTER OF 2021 (-EUR 39.7 MLN) STANDS AGAINST THE EUR 55.1 MLN LOSS POSTED FOR THE MONTHS OF FEBRUARY AND MARCH 2020. THE 30% LOSS REDUCTION BEARS WITNESS TO THE GRADUAL RETURN TO A GOVERNANCE ORIENTED TOWARDS SOUND AND PRUDENT MANAGEMENT FOCUSING ON COMMERCIAL RELAUNCH
• STEADY GROWTH IN SALES AND DISTRIBUTION2 FROM 31 MARCH 2020 TO 31 MARCH 2021:
  o EUR 1.0 BN TOTAL INCREASE (+7.8%) IN DEPOSITS AND OTHER DIRECT
  FUNDING FROM CUSTOMERS (AMOUNTING TO EUR 12.9 BN)2
  o NEW INFLOWS OF OVER EUR 900 MLN (+8.5%) TO AuM (EUR 11.5 BN) AND
  EUR 200 MLN (+1.6%) TO AuC (EUR 11.3 BN)2
  o LOANS TO CUSTOMERS UP BY OVER EUR 300 MLN (+2.9%) TO EUR 11.7 BN2
• HIGHER THAN SYSTEM AVERAGE PERFORMANCE CONFIRMED IN THE PLACEMENT OF ASSET MANAGEMENT PRODUCTS (+3.0% VS +1.3%3), WITH
  MUTUAL FUNDS AND OPEN-ENDED COLLECTIVE INVESTMENT SCHEMES UP 21.7% Y/Y (+ EUR 1.0 BN2 TO EUR 5.7 BN2)
• 1Q POSITIVE COMMERCIAL RESULTS ARE ONLY PARTIALLY REFLECTIVE OF THE UPSIDE FROM THE DEFINITION OF THE NEW SERVICE MODEL, WHICH IS BEING PHASED IN TO FULL IMPLEMENTATION
• GROWTH TREND OF TOP LINE REVENUES (NII + NET FEES AND COMMISSIONS) CONFIRMED AT Q3 AND Q4 2020 LEVELS; +4% ON 1Q20201
• CONTINUED FOCUS ON STRUCTURAL COST REDUCTION WITH PERSONNEL EXPENSES DOWN 9.5% COMPARED TO THE FIRST QUARTER OF 20201
• THE GROUP ENHANCES ITS PERCEPTION AS A POINT OF REFERENCE FOR LIGURIAN SMALL AND MEDIUM-SIZED ENTERPRISES AND CUSTOMERS IN ITS FOOTPRINT AREAS OF CHOICE:
  o SUPPORT PROVIDED TO APPROXIMATELY 37,000 BUSINESSES THROUGH
  THE APPROVAL OF EUR 2.8 BN WORTH OF STATE-GUARANTEED LOANS,

1With the month of January 2020 being included in the Financial Statements for the period under Temporary Administration, the results for the first quarter of 2021 are not comparable with those of the first quarter of 2020. Any comparison with the first quarter of 2020 -if commented on- is the result of a quarterly pro-rata recalculation of the first two months (February/March) of the 2020 ordinary course of administration.

1. Operational data
2. Source: Processing of data from the Funds and Asset Management Association, 'Assogestioni'

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ROUGHLY 2.5 TIMES THE GROUP'S MARKET SHARE

• 1. IN LIGURIA, 25% OF THIS TYPE OF LOANS ARE GRANTED BY CARIGE
• NON-PERFORMINGLOANS TO CUSTOMERS, NET OF PROVISIONS, DOWN TO EUR 309.2 MLN AND ASSET QUALITY CONFIRMED AT BEST MARKET LEVELS:
• 1. NPE RATIO: 4.9% GROSS, 2.5%NET (VS. BANKING SYSTEM AVERAGE OF 5.5% AND 2.8% RESPECTIVELY4)

1. AVERAGE NON-PERFORMING LOAN BOOK COVERAGE OF 49.6% (51.1% INCLUDING WRITE OFFS)

1. PERFORMING LOAN BOOK COVERAGE OF 1% (1.1% NET OF REPOS), FAR BEYOND BANKING SYSTEM AVERAGE

• 1. ANNUALISED COST OF CREDIT: 69 BPS, IN LINE WITH BUDGET TARGETS FOR THE PERIOD, REFLECTIG THE IMPACT ON COLLECTIVE IMPAIRMENT LOSSES OF THE APPLICATION OF THE NEW DEFINITION OF DEFAULT AND FORBEARANCE MEASURES (MORATORIA) GRANTED TO SUPPORT THE ECONOMY
• FULL-SPEEDROLL OUT OF THE NEW SERVICE MODEL, WHICH IS BEING ACHIEVED THROUGH THE
• 1. REORGANISATION OF THE WEALTH MANAGEMENT SEGMENT

1. ONGOING RELEASE OF THE NEW ON-LINE BANKING APP

1. GROWING SHARE OF SERVICES PROVIDED THROUGH THE "REMOTE

BANKING PROPOSITION"

1. NEW COLLABORATION INITIATIVES WITH PARTNERS IN NON-LIFE

BANCASSURANCE AND CONSUMER CREDIT

IS THE PREREQUISITE FOR A FORESEEABLE TREND OF GRADUAL ACCELERATION IN VOLUMES SOLD, WITH A PROPORTIONAL INCREASE IN REVENUES AND A STEADY RECOVERY OF PROFITABILITY

• THE GROUP'S COMMITMENT TO THE YOUNGER GENERATIONS CONTINUES. ON THE BACK OF THE SUCCESS OF THE FIRST EDITION OF THE MASTER'S DEGREE PROJECT IN BANKING NETWORK MANAGEMENT, CANDIDATES ARE BEING SELECTED FOR THE SECOND EDITION
• THE GROUP HAS STARTED PREPARATORY WORK TO FOCUS ON ENVIRONMENTAL, SOCIAL AND CORPORATE GOVERNANCE (ESG) ISSUES, WHICH WILL GRADUALLY BE INCORPORATED INTO THE BUSINESS MODEL

Genoa, 12 May 2021 - Banca Carige's Board of Directors has today approved the Group's consolidated results as at 31 March 2021. The first quarter of 2021 saw confirmation of the evidence of an accelerating commercial momentum following the already positive results observed as of March 2020; in particular, in the period from 31 March 2020 to 31 March 2021, significant results were achieved in deposits and other direct funding from customers,

4 Source: Press releases and presentations published for the period ended 31 March 2021(Intesa, Unicredit, Banco BPM, MPS, BPER, Credem, BP Sondrio and Creval; Financial Statements as at 31 December 2020 for Credit Agricole Italia)

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up by approximately EUR 1.0 bn5 (+7.8% to EUR 12.9 bn5), in assets under management with over EUR 0.9 bn5 new inflows (+8.5% to EUR 11.5 bn), and assets under custody with new inflows for an amount of approximately EUR 0.2 bn5 (+1.6% to EUR 11.3 bn). The placement of asset management products confirmed its positive performance in the quarter, marking a 3.0% increase on December 2020, over twice the average for the banking system (+1.3%6). Mutual funds, open-ended collective investment schemes (SICAV) and portfolio management settled at EUR 5.7 bn5 showing the strongest Y/Y increase (+21.7%5; +EUR 1.0 bn5). The volume of loans to customers was likewise up by over EUR 300.0 mln5 (+2.9%; to EUR 11.7 bn5).

The sharp rise in volumes confirms the effect of the renewed sales momentum, which could only partially benefit from the newly defined service model introduced last January which is gradually becoming fully operational, as well as from certain activities launched early this year, such as the newly introduced repricing of certain asset items, the relaunch of synergies with commercial partners (resulting in an average monthly inflows increase by 17.8%5 in non- life insurance and 12.2%5 in consumer credit with respect to the last quarter of 2020), and the purchase of tax credits under the 'Eco-bonus' scheme (with EUR 108.05 mln in tax credits already acquired and a higher average number of tax credit transfer applications per branch than for most of the banking system), which will fully contribute to revenue generation only in the quarters to come.

The consolidation of top line revenues (net interest income and net fee and commission income) observed in the previous quarters was likewise confirmed in 1Q2021 (+4.0%7 as compared to 1Q2020) as was the ongoing parallel structural cost reduction, both of which contributed to a more evident gradual recovery of profitability, while the contribution of profit from trading was negligible. Total loan loss provisions posted in the quarter reflect the impact on collective impairment losses of the application of the new definition of default and the

1. Operational data
2. Source: Processing of data from the Funds and Asset Management Association, 'Assogestioni'
3. With the first month of 2020 being included in the Financial Statements for the period under Temporary Administration, any comparison with the first quarter of 2020 -if commented on- is the result of a quarterly pro-rata recalculation of the first two months (February/March) of the 2020 ordinary course of administration

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forbearance measures (moratoria) granted to support the economy. As a result, the annualised cost of risk is 69 bps8.

The Group enhances its perception as a point of reference for Ligurian small and medium- sized enterprises and customers in its footprint areas of choice, through the approval of EUR

2.8 bn9 worth of state-guaranteed loans (roughly 2.5 times its market share) granted to over 37,000 businesses (of which EUR 2.4 bn9 disbursed by 30 April 2021) to counter the economic effects of the restrictive measures adopted in response to the pandemic. In Liguria, 25% of this type of loans were granted by the Bank. The Bank also continued to support SMEs and households by granting an overall amount of EUR 2.1 bn9 worth of moratoria on loans, of which EUR 1.2 bn outstanding as at 30 April 2021, with no signs of impairment for past due/paid off positions.

Despite the pandemic crisis, the Group maintained an extremely low risk profile also in the first quarter of the year, continuing its derisking activity (disposal of non-performing leases to AMCO for a gross amount of approximately EUR 67.0 mln), with average non-peforming loan portfolio coverage settling at 49.6%10 (51.1% including write-offs) and a gross and net NPE ratio (share of non-performing loans out of total loans) of 4.9 and 2.5%, respectively.

The level of RWAs measured under the standardised approach totalled EUR 9.5 bn11, with capital ratios in excess of regulatory requirements: phased-in CET1 ratio of 11.5%11 and phased-in Total Capital ratio of 13.7%11.

1. Ratio of net value adjustments, gains/losses on disposal and contractual modifications not resulting in derecognition (Items 100(a) - for the loans component only, 130(a) - for the loans to customers component only and 140 of the Income Statement) and Net loans to customers (Balance Sheet item 40(a) net of debt securities at amortised cost)
2. Operational data
3. Figure referred to balance sheet credit exposures to customers
4. Operational estimate, pending official supervisory reporting

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Francesco Guido, CEO of Banca Carige, comments on the first quarter results: "The growth in funding and lending volumes, the extremely low asset risk profile and the successful launch of new streams of operation are the preconditions for boosting profitability. Growth will be gradual, with households and businesses at its very centre, up to advanced, innovative standards. I would like to thank the entire staff of Carige, without whose paramount contribution none of this would be possible".

The quarter just ended does not yet incorporate the upside of the new service model which is being implemented through the: (i) reorganisation of the Wealth Management segment, which will be completed by the end of Q2 with the release of the new workstation for customer relationship managers and the inauguration of new private banking branches, (ii) release of the new iOS and Android app on the app stores for customers, (iii) fine-tuning of the range of services provided through the "remote proposition", to be completed by June, (iv) new collaboration initiatives with partners to boost non-life bancassurance and consumer credit. These measures are paving the way for a foreseeable trend of gradual acceleration in volumes sold, with a proportional increase in revenues and a steady recovery of profitability in the quarters to come.

The Group's commitment to the younger generations continues. On the back of the success of the first edition of the master's degree project in banking network management, whereby 20 young talents were hired, 400 candidates are being selected for participation in the second edition.

The Group has also started preparatory work to focus on environmental, social and corporate governance (ESG) issues, which will gradually be incorporated into the business model. Against this background, following the initial verification of its positioning, the Bank launched a sustainability project called "Carige sostenibile", which marks the first phase of a more comprehensive programme aimed at pursuing objectives for the development of a culture of sustainability for the Group through the promotion of a sustainability strategy and the programming of an action plan to be implemented in 2021, in line with regulatory developments in the sector.

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