Banco di Desio e della Brianza S p A : Report on operations and financial statements at 31 december 2020

Report on operations and

financial statements at 31 December 2020

Contents

Directors and officers	1
Report on Operations	2
Financial statements	48
Balance sheet	49
Income statement	51
Statement of comprehensive income	52
Statement of changes in shareholders' equity	53
Cash flow statement	55
Explanatory notes	57
Part A - Accounting policies	58
Part B - Information on the balance sheet	98
Part C - Information on the income statement	152
Part D - Comprehensive income	174
Part E - Information on risks and related hedging policy	175
Part F - Information on shareholders' equity	237
Part H - Transactions with related parties	239
Part M - Information on leases	242
Certification pursuant to art.154-bis of Legislative Decree 58/98	245
Auditors' report	247
Report of the Board of Statutory Auditors	255

Report on Operations

Directors and officers

Board of directors

Chairman		Stefano Lado
Deputy Chairman		Tommaso Cartone
Chief Executive Officer and General Manager	Alessandro Maria Decio*
Directors		Graziella Bologna*
		Valentina Maria Carla Casella
		Ulrico Dragoni
		Cristina Finocchi Mahne
		Agostino Gavazzi*
		Egidio Gavazzi*
		Tito Gavazzi
		Giulia Pusterla
		Laura Tulli
* Members of the Executive Committ ee
Board of Statutory Auditors

Chairman

Acting Auditors

Substitute Auditors

Emiliano Barcaroli

Rodolfo Anghileri

Stefania Chiaruttini

Stefano Antonini

Silvia Re

Massimo Celli

General Management

Chief Executive Officer and General Manager	Alessandro Maria Decio

Financial Reporting Manager as per art. 154-bis CFA

Financial Reporting Manager	Mauro Walter Colombo

Independent Auditors

Independent Auditors

Deloitte & Touche S.p.A.

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Report on Operations

Report on Operations

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Report on Operations

1.Introduction

The figures and ratios in this Report on Operations, as well as the comments on the composition of the various captions and any changes to them, to the extent that they can be traced back, refer to the balance sheet included in the financial statements and to the reclassified income statement, which has been prepared on the basis of the financial statements.

In the first few months of 2020, the Covid-19 pandemic unleashed its negative effects on the production and aggregate demand of all economies. The deterioration in growth prospects translated into a hefty decline in stock market indices and a sharp rise in volatility and risk aversion. The monetary and fiscal authorities in all principal countries implemented strong expansionary measures to support household and business income, credit for the economy and market liquidity.

The specific disclosure dedicated to describing the healthcare emergency under which this financial report has been prepared, together with the related uncertainties and significant risks, is presented in section 3.3 "Covid-19" of the consolidated report on operations

Inevitably, the results of Banco were also heavily affected by the recurring nature of the pandemic, experienced in waves, the consequences of which for the economy in general and for economic and financial performance in future years remain uncertain, depending on how the various possible scenarios play out.

The content of the explanatory notes takes account of the instructions contained in Consob Note 8/20 dated 16 July 2020, the ESMA document entitled "European common enforcement priorities for 2020 annual financial reports" dated 28 October 2020 and the Bank of Italy Communication issued on 15 December 2020, which are discussed in "Part A - Accounting policies" and "Part E - Information on risks and related hedging policy"of the explanatory notes. A summary of the main interventions/support measures adopted or in the process of being adopted reference should be made to the consolidated report on operation at 31 December 2020.

With regard to dividend policy in the context of the Covid-19 pandemic, the resolution adopted at the Shareholders' Meeting held on 23 April 2020 - following the Recommendation dated 27 March 2020, as supplemented by the supervisory instructions issued on 28 July 2020 and 16 December 2020 - remains in force.

The Board of Directors and the Shareholders' Meeting are committed to adopting all necessary and appropriate resolutions consistent with the above recommendations, not least with reference to distribution of the savings share dividend in compliance with art. 31 of the Articles of Association.

As regards remuneration, on 25 June 2020 the Board of Directors approved a revision of the bonus system which led to a significant reduction in the variable component ("bonus pool") for 2020.

This is a translation of the Italian original "Bilancio d'esercizio al 31 dicembre 2020 di Banco di Desio e della Brianza" and has been prepared solely for the convenience of international readers. In the event of any ambiguity, the Italian text will prevail.

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