Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

Results at September 30th, 2020 approved

OUTSTANDING INDUSTRIAL RESULTS

WITH REVENUES AND NET PROFIT GROWING STRONGLY

THE COMPLEX CONTEXT IS REWARDING OUR DIVERSIFIED BUSINESS MODEL

  • Strong growth in net profit1 thanks to the diversified business

    • model: €246.3 million (+22.7% y/y)
    • Gross operating profits1: €397.5 million (+30.8% a/a)
        • Revenues1: €594.2 million (+21.5% y/y)
      • Operating costs: 196.7 million (+3.8%2 y/y)
    • Cost/income ratio1 declining to 33.1% (-4.8 p.p. y/y)
      • Solid capital position: CET1 at 23.28%

FIGURES AT OCTOBER 31st, 2020

Net sales in the month of October at €739 million, +91% y/y

Estimated brokerage revenues at €14 million, +12% y/y

Milan, November 9th, 2020

The Board of Directors of FinecoBank S.p.A. has approved the results at September 30th, 2020. Alessandro Foti, CEO and General Manager of FinecoBank, stated:

  1. Figures net of non-recurring items recorded in the first nine months of 2020:€-1.4 million gross (€-1.0 million net) related to Voluntary Scheme fair value, of which: €-0.2 million gross (€-0.2 million net) in the third quarter of 2020; €- 1.2 million gross (-€0.8 million net) in the first quarter of 2020.
    Non-recurring items recorded in the first nine months of 2019: €-4.4 million gross (€-2.9 million net) related to Voluntary
    Scheme fair value, of which: €0.4 million gross (€0.3 million net) in the third quarter of 2019; €-4.3 million gross (€-2.9 million net) in the second quarter of 2019; €-0.4 million gross (€-0.3 million net) in the first quarter of 2019. Patent Box: €-0.9 million in the third quarter of 2019; €-0.9 million in the second quarter of 2019; €-0.9 million in the first quarter of 2019
  2. Net of marketing expenses in UK in the first 9 months of 2020

1

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

"Figures recorded in the first nine months highlight the excellent response of Fineco to an uncertain and complex phase we are facing. We are very satisfied about these results as they confirm the solidity of the bank and the strength of our diversified and sustainable business model. Our distinctive digital DNA supported us in reaching a strong growth in all business areas, confirming a great interest by many clients in interacting with markets and investing through our integrated platform.

October net sales maintained the very robust growth trend started at the beginning of the year, with clients appreciating new investment products launched by FAM in the second half of the month, which fully meet the customers' needs in a complex market phase. In addition, we confirm brokerage structural growth on a yearly basis, thanks to both the reshaping of our offer and the enlargement of the base of active clients".

9M20

HIGHLIGHTS

UPDATE ON INITIATIVES

FINECOBANK

  • Revenues1 at €594.2 million, +21.5% y/y mainly led by Brokerage area (+83.8% y/y), thanks to the combined effect of the reshape of our product offer, the enlargement of the clients base, the increase of Fineco market share and the higher market volatility, and by Investing area (+5.7% a/a), thanks to the contribution of Fineco Asset Management and to the higher impact of Guided Products and Services.
  • Operating costs at €196.7 million, +6.2% y/y; operating costs net of marketing expenses in UK at €192.2 million, +3.8% y/y. Cost/Income ratio1 at 33.1%, down by 4.8 percentage points y/y confirming the Bank's operational efficiency
  • Gross operating profit at €397.5 million, +30.7%
  • Net profit1 at €246.3 million, +22.7% y/y, despite the higher contribution related to Systemic charges3
  • Fineco is keeping on developing its UK offer, with the broadening of the investing offer that will continue in the coming months. The success of the first marketing campaign confirms how the one-stop-solutionoffered by the Bank is very well welcomed.
  • The process of reshape of the brokerage offer is continuing with the launch of new products and services (Asian markets, CFD, new release of the platform PowerDesk, we are in the process of vertically integrating certificates, becoming issuer, market maker and distributor through our platform)
  • Activities continued to develop Fineco Asset Management which, also thanks to the recent launch of a new edition of the FAM Global Defence fund, has confirmed its increasing capacity to promptly and effectively respond to customer needs

3 Systemic charges in the first 9 months of 2020: Deposit Guarantee Scheme estimated in €28.0 million, including an estimated additional contribution of €-7.1 million to a member of Interbank Deposit Protection Fund; Single

Resolution Fund: €-0.9 million

2

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

TOTAL FINANCIAL ASSETS AND NET SALES

Total Financial Assets (TFA) at September 30th, 2020 amounted to €85.0 billion, up 8.2% compared to September 2019. Stock of Assets under Management was €41.7 billion, up 8.9% y/y, assets under custody amounted to €16.8 billion (+11.0% y/y), while the stock of direct deposits amounted to €26.4 billion (+5.3% y/y) thanks to the continuous growth in new customers and "transactional" deposits.

In particular, the TFA related to Private Banking customers4 totaled €34.4 billion, up by 8.0% y/y.

In the first nine months of 2020, inflows totalled €6.4 billion (+46.1% y/y), again proving to be solid, of high quality and gathered without short-term commercial incentives. The asset mix shifted positively towards asset under management, standing at €2.6 billion in the period (+35.6% y/y), highlighting a more cautious approach by clients who are favouring more conservative products. Inflows in asset under custody stood at €2.8 billion in the period, confirming clients' increased interest towards financial markets through Fineco brokerage platform, while direct deposits flows totalled €0.9 billion.

Since the start of the year, inflows into "Guided products & services" reached €2.6 billion (+16.3% y/y), confirming customer appreciation.

The ratio of Guided Products compared to total AuM rose to 73% compared to 70% in September 2019.

On September 30th, 2020 the network was composed of 2,577 Personal Financial Advisors operating across the country through 403 Fineco Centers. Inflows in the first nine months of the year through the PFA network were €5.5 billion.

As at September 30th, 2020, Fineco Asset Management managed €14.8 billion of assets, of which €9.5 billion were retail class (+28.4% y/y) and around €5.4 billion institutional class (+2.4% y/y).

In the first nine months of 2020, about 66,500 new customers were acquired. The total number of customers as at September 30th, 2020 was 1,362,262.

4 Private Banking clients have assets above €500,000.

3

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

MAIN INCOME STATEMENT RESULTS AT 30.09.2020

Figures and variations in this paragraph and in the next one on quarterly results are shown net of non- recurring items1

mln

1Q19

2Q19

3Q19

9M19

1Q20

2Q20

3Q20

Adj. (1)

Adj. (1)

Adj. (1)

Adj. (1)

Adj. (1)

Adj. (1)

Adj. (1)

Net interest income

70.4

71.4

69.8

211.6

68.2

70.1

68.6

Net commissions

77.4

81.3

84.3

242.9

105.0

104.8

97.9

Trading profit

10.3

12.3

11.2

33.8

27.6

30.1

20.4

Other expenses/income

0.2

0.3

0.1

0.7

0.6

0.8

0.2

Total revenues

158.2

165.4

165.4

489.0

201.3

205.8

187.1

Staff expenses

-21.7

-22.4

-22.5

-66.6

-24.0

-24.9

-24.6

Other admin.expenses

-38.5

-34.4

-29.4

-102.3

-36.5

-34.6

-33.4

Impairment/write-backs on intangible

9M20 Adj. (1)

206.9

307.6

78.1

1.6

594.2

-73.5

-104.5

9M20/

3Q20/

3Q20/

9M19

3Q19

2Q20

-2.2%

-1.7%

-2.0%

26.6%

16.2%

-6.6%

131.0%

82.3%

-32.1%

n.s.

12.5%

-79.7%

21.5%

13.1%

-9.1%

10.4%

9.6%

-1.0%

2.2%

13.9%

-3.5%

and tangible assets

-5.1

-5.4

-5.8

-16.3

-6.1

-6.2

-6.4

Operating expenses

-65.3

-62.3

-57.6

-185.2

-66.5

-65.7

-64.4

Gross operating profit

92.9

103.1

107.8

303.8

134.8

140.0

122.7

Other charges and provisions

-1.0

-2.9

-19.8

-23.6

-1.1

-6.5

-32.0

LLP

-1.3

1.1

-1.2

-1.4

-1.0

-2.7

0.1

Profit from investments

-0.7

6.5

0.4

6.3

-0.1

-3.7

-0.2

Profit before taxes

90.0

107.8

87.2

285.1

132.6

127.1

90.7

Income taxes

-26.5

-32.2

-25.6

-84.3

-40.4

-38.3

-25.3

Net profit adjusted

63.5

75.6

61.7

200.7

92.2

88.7

65.3

-18.6

14.4%

10.2%

2.6%

-196.7

6.2%

11.8%

-1.9%

397.5

30.8%

13.8%

-12.4%

-39.6

67.7%

61.6%

390.9%

-3.5

157.2%

-112.1%

-105.5%

-4.0

-163.9%

-140.3%

-95.1%

350.3

22.9%

3.9%

-28.7%

-104.0

23.4%

-0.9%

-33.9%

246.3

22.7%

6.0%

-26.4%

Revenues for the first nine months of 2020 totaled €594.2 million, up 21.5% compared to €489.0 million in the same period of the previous year, mainly thanks to the positive contribution of net commission and trading profit.

Net interest income stood at €206.9 million, down 2.2% from €211.6 million at September 30th, 2019, mainly due to the fall in market interest rates, partly offset by the positive contribution from volume effect, higher lending activity and a more dynamic Treasury management (revenues generated by Other Treasury activities have been recasted in the line).

The average gross margin on interest-earning assets in the first nine months of 2020 was 1.03% compared to 1.23% in the same period of 2019.

Net commissions stood at €307.6 million, up 26.6% from €242.9 million at September 30th 2020.

This increase is mainly due to the rise in net commissions in the Brokerage area (+76.4% y/y) thanks to the combined effect of the reshape of our product offer, the enlargement of the clients base, the increase of Fineco market share (Assosim market share on equity traded volumes increased by 1.4 percentage points at 28.0% as of June 30th, 2020, last available data) and the higher market volatility in the period. Investing area grew by 5.6% y/y thanks to Fineco Asset Management contribution and the higher impact of Guided Products and Services, while banking fees grew by 81.0% y/y.

Trading profit amounted to €78.1 million in the first nine monts of 2020 (+131.0% y/y), mainly thanks to the contribution from the Brokerage area (€69.3 million, +134.5% y/y). Trading profit also includes the income components from financial instruments accounted under "Other financial instruments measured at fair value" which include the Visa INC shares, convertible preferred, whose fair-value measurements led to a positive result of €0.2 million in the first nine months of 20205 (+€2.2 million in the first nine months of 2019).

5 €-1.1 million in 1Q20, €+1.2 million in 2Q20 and €+0.2 million in 3Q20

4

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

It also includes profits coming from the sale of government bonds held in "Financial assets designated at fair value through other comprehensive income" and in "Financial assets at amortized cost" for a total value of €8.7 million6 (€2.7 million in the first nine months of 2019 ).

Operating costs in the first nine months of 2020 were well under control at €196.7 million, up 6.2% y/y mainly due to higher staff expenses and for the launch of the marketing campaign in UK. Net of the latter, operating costs were equal to €192.2 million (+3.8% y/y). The cost/income ratio was equal to 33.1%, down by 4.8 percentage points y/y.

Staff expenses totaled €73.5 million (+10.4% y/y) mainly due to the increase in the number of employees, which rose to 1,251 as of September 30th, 2020 from 1,191 as of September 30th, 2019 also due to the gradual internalisation of some services following the exit from the UniCredit Group.

Gross operating profit came to €397.5 million, up by 30.8% y/y.

Other charges and provisions in the first nine months of 2020 totaled €-39.6 million, increasing mainly due to ordinary annual contribution to the Deposit Guarantee Schemes (DGS), estimated in €28.0 million (compared to €17.5 million in the same period of 2019), including an additional contribution related to a member of Interbank Deposit Protection Fund, estimated in €7.1 million. Moreover, €-6.3 million of higher provisions are recorded in the period following the decision to refund to a cluster of clients the fees related to the smart repricing charged between February and September 2020, following the communication received by the Guarantor for Competition and the Market Authority (A.G.C.M.). Therefore, based on the discussions had with the Authority, the Bank, although fully confirming the correctness of its decisions, has considered appropriate to refund the cluster of customers related to the commercial practice in question

Loan loss provisions amounted to €-3.5 million, increasing compared to the €-1.4 million recorded in the first nine months of 2019. The increase is mainly due to the update in the second quarter of 2020 of the macroeconomic scenario after the health emergency caused by the spread of COVID-19 virus, as requested by IFRS9. In the third quarter €0.3 million of writebacks have been accounted. The cost of risk is down to 11 basis points from 14 basis points as of June 30th, 2020, confirming the quality of the loan book of the Bank.

Profit on Investments amounted to €-4.0 million, of which €-3.8 million due to the Bank's government institutional exposures, mainly after the aforementioned update of the macroeconomic scenario under IFRS9 in the second quarter of 2020, which led to €-3.5 million higher provisions.

Please note that the €6.3 million recorded in the first nine months of 2019 benefitted from a write-back of approximately €7.0 million thanks to the collateralization of the exposure towards the UniCredit bonds due to the Pledge Agreement agreed between FinecoBank and the UniCredit Group.

Profit before taxes stood at €350.3 million, up by 22.9% y/y.

Net profit for the period was equal to €246.3 million, increasing by 22.7% y/y.

6 €3.8 million in 1Q20, €5.0 million in 2Q20 and €-0.1 million in 3Q20

5

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

MAIN INCOME STATEMENT RESULTS OF THE THIRD QUARTER 2020

Revenues were equal to €187.1 million, decreasing compared to the previous quarter due to the lower contribution of the Brokerage business due to the different seasonality, and increasing by 13.1% y/y mainly thanks to the positive contribution of Brokerage and Investing.

Net interest income in the third quarter was €68.6 million, down compared to the previous quarter and to the same quarter of 2019 mainly due to the fall in base rates.

The average lending rate for the investment of all deposits amounted to 0.98%, down compared to 1.04% in the previous quarter and 1.17% in the third quarter of 2019.

Net commissions amounted to €97.9 million, decreasing by 6.6% compared to the previous quarter, as the positive contribution of Investing (+8.3%) has not counterbalanced the lower contribution by brokerage (- 29.4%) also due to seasonality. Net commissions are increasing by 16.2% compared to the previous year thanks to the contribution of all the business areas.

Trading profit was equal to €20.4 million, down by €9.7 million compared to the previous quarter, and up by €9.2 million compared to the third quarter of 2019.

Total operating costs in the third quarter of 2020 came to €64.4 million, down by 1.9% compared to the previous quarter and increasing 11.8% compared to the same quarter of 2019, due to higher staff expenses and to a different distribution of marketing expenses.

Operating profit was equal to €122.7 million, down by 12.4% compared to the previous quarter and increasing by 13.8% compared to the third quarter of 2019.

Provisions for risks and charges amounted to -€32.0 million, compared to -€6.5 million in the previous quarter and -€19.8 million in the third quarter of 2019, increasing mainly due to the annual contribution to the Deposit Guarantee Schemes (DGS) and to the contribution to a member of the Interbank Deposit Protection Fund. Also, in the third quarter of 2020 have been accounted €-2.3 million of provisions following the communication received by the Guarantor for Competition and the Market Authority (A.G.C.M.)

Loan loss provisions amounted to €0.1 million thanks to €0.3 million writebacks in the quarter, compared to €-2.7 million provisions in the previous quarter and to €-1.2 million in the third quarter of 2019.

Profit from investments amounted to €-0.2 million, increasing compared to €-3.5 million in the previous quarter and decreasing compared to €0.4 million in the same period of 2019.

Profit before taxes in the quarter was equal to €90.7 million, down by 28.7% q/q and up by 3.9% y/y.

Net profit in the quarter was equal to €65.3 million, down by 26.4% q/q and up by 6.0% y/y.

SHAREHOLDERS' EQUITY AND CAPITAL RATIOS

6

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

Consolidated shareholders' equity came to €1,620.4 million and is up by €64.7 million compared to June 30th, 2020 and by €237.9 million compared to December 31st, 2019, mainly due to the profit respectively in the third quarter 2020 and first nine months of 2020, net of the coupon payment of Fineco AT1 instruments in the second quarter 2020 (€-9.9 million, net of tax).

The Bank confirms its solid capital position with a CET1 ratio of 23.28% as of September 30th, 2020 (including the amount of the 2019 dividend suspended by the Board of Directors on April 6th, 2020), compared to 24.19% as of 31 December 2019 pro-forma (18.12% the figure reported in the 2019 Financial Statements approved by the Board of Directors on February 11th, 2020).

The Tier 1 ratio and the Total Capital Ratio were equal to 37.41% as of September 30th, 2020 compared to 39.73% as of December 31st, 2019 pro-forma (33,67 % reported in the 2019 Financial Statements approved by the Board of Directors on February 11th, 2020).

The leverage ratio was 4.35% in September 2020 compared to 4.54% pro-forma in December 20197 .

LOANS TO CUSTOMERS

Loans to customers at September 30th, 2020 totalled €4,320 million, up by 17.4% compared to December 31st, 2019 and by 2.8% compared to June 30th, 2020.

The amount of non-performing loans (loans with insolvent borrowers, unlikely to pay and non-performing loans/past due) net of impairment totaled €3.7 million (€4.7 million at June 30th, 2020 and €3.6 million as of December 31st, 2019), with an 85.6% coverage ratio. The ratio between the amount of non-performing loans and total loans to ordinary customers came to 0.10% (0.12% at June 30th, 2020 and 0.11% December 31st, 2019).

SIGNIFICANT EVENTS IN THE THIRD QUARTER OF 2020 AND SUBSEQUENT EVENTS

No significant events occurred after September 30, 2020 that would make it necessary to change any of the information given in this report.

With reference to the main events that occurred during 3Q20, refer to section "Subsequent events" in the Consolidated interim report on operations, which is an integral part of Consolidated first half financial report as at 30 June 2020 as well as the press releases published on FinecoBank website.

NEW INITIATIVES MONITORING

Activities continued to develop Fineco Asset Management which, also thanks to the recent launch of a new edition of the FAM Global Defence fund, has confirmed its increasing capacity to promptly and effectively respond to customer needs.

7 3.85% reported in the 2019 Financial Statements approved by the Board of Directors on February 11th, 2020

7

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

The reshape of the brokerage offering is continuing, after the recent launch of CFD and the enlargement of its multicurrency offering. Furthermore, Fineco is in the process of vertically integrating certificates, allowing the Bank to become issuer, market maker and distributor through our platform.

Fineco is keeping on developing its UK offer, with the broadening of the investing offer that will continue in the coming months. The success of the first marketing campaign confirms how the one-stop-solutionoffered by the Bank is very well welcomed.

8

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

CONSOLIDATED BALANCE SHEET

(Amounts in €thousand)

Amounts as at

Changes

ASSETS

September 30, 2020

December 31, 2019

Amounts

%

Cash and cash balances

987,533

754,386

233,147

30.9%

Financial assets held for trading

13,146

7,933

5,213

65.7%

Loans and receivables with banks

773,653

566,033

207,620

36.7%

Loans and receivables with customers

4,320,340

3,679,829

640,511

17.4%

Financial investments

22,974,599

22,304,892

669,707

3.0%

Hedging instruments

76,119

64,939

11,180

17.2%

Property, plant and equipment

150,459

152,048

(1,589)

-1.0%

Goodwill

89,602

89,602

-

-

Other intangible assets

37,812

37,492

320

0.9%

Tax assets

14,405

23,444

(9,039)

-38.6%

Other assets

282,998

342,309

(59,311)

-17.3%

Total assets

29,720,666

28,022,907

1,697,759

6.1%

(Amounts in €thousand)

Amounts as at

Changes

LIABILITIES AND SHAREHOLDERS' EQUITY

September 30, 2020

December 31, 2019

Amounts

%

Deposits from banks

104,977

154,653

(49,676)

-32.1%

Deposits from customers

27,296,509

25,919,858

1,376,651

5.3%

Financial liabilities held for trading

5,737

3,777

1,960

51.9%

Hedging instruments

211,970

94,950

117,020

123.2%

Tax liabilities

51,118

11,437

39,681

347.0%

Other liabilities

429,953

455,748

(25,795)

-5.7%

Shareholders' equity

1,620,402

1,382,484

237,918

17.2%

- capital and reserves

1,375,138

1,093,117

282,021

25.8%

- revaluation reserves

(84)

1,002

(1,086)

-108.4%

- net profit

245,348

288,365

(43,017)

-14.9%

Total liabilities and Shareholders' equity

29,720,666

28,022,907

1,697,759

6.1%

9

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

CONSOLIDATED BALANCE SHEET - QUARTERLY FIGURES

(Amounts in €thousand)

September 30, 2019

December 31, 2019

March 31, 2020

June 30, 2020 September 30, 2020

ASSETS

Cash and cash balances

1,208,686

754,386

1,177,380

909,802

987,533

Financial assets held for trading

10,592

7,933

12,888

14,591

13,146

Loans and receivables with banks

824,635

566,033

625,247

723,189

773,653

Loans and receivables with customers

3,567,804

3,679,829

3,741,000

4,204,291

4,320,340

Financial investments

21,521,272

22,304,892

23,400,694

22,946,524

22,974,599

Hedging instruments

71,941

64,939

76,454

75,577

76,119

Property, plant and equipment

148,644

152,048

152,973

153,685

150,459

Goodwill

89,602

89,602

89,602

89,602

89,602

Other intangible assets

8,760

37,492

37,053

36,592

37,812

Tax assets

7,688

23,444

3,300

4,186

14,405

Other assets

300,341

342,309

202,426

254,169

282,998

Total assets

27,759,965

28,022,907

29,519,017

29,412,208

29,720,666

(Amounts in €thousand)

September 30, 2019

December 31, 2019

March 31, 2020

June 30, 2020

September 30, 2020

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits from banks

188,171

154,653

330,927

113,137

104,977

Deposits from customers

25,428,742

25,919,858

27,202,155

27,021,199

27,296,509

Financial liabilities held for trading

4,734

3,777

11,039

8,209

5,737

Hedging instruments

156,435

94,950

143,500

207,116

211,970

Tax liabilities

50,929

11,437

32,254

62,928

51,118

Other liabilities

642,227

455,748

322,068

443,965

429,953

Shareholders' equity

1,288,727

1,382,484

1,477,074

1,555,654

1,620,402

- capital and reserves

1,100,134

1,093,117

1,382,491

1,373,995

1,375,138

- revaluation reserves

(6,566)

1,002

3,152

1,485

(84)

- net profit

195,159

288,365

91,431

180,174

245,348

Total liabilities and Shareholders' equity

27,759,965

28,022,907

29,519,017

29,412,208

29,720,666

10

Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

INCOME STATEMENT

(Amounts in €thousand)

3Q 20

3Q 19

Changes

Am ounts

%

Net interest

206,874

211,573

(4,699)

-2.2%

Net fee and commission income

307,613

242,896

64,717

26.6%

Net trading, hedging and fair value income

76,670

29,438

47,232

160.4%

Net other expenses/income

1,561

684

877

128.2%

OPERATING INCOME

592,718

484,591

108,127

22.3%

Staff expenses

(73,540)

(66,594)

(6,946)

10.4%

Other administrative expenses

(185,199)

(179,761)

(5,438)

3.0%

Recovery of expenses

80,701

77,486

3,215

4.1%

Impairment/write-backs on intangible and tangible assets

(18,641)

(16,293)

(2,348)

14.4%

Operating costs

(196,679)

(185,162)

(11,517)

6.2%

OPERATING PROFIT (LOSS)

396,039

299,429

96,610

32.3%

commitments

(3,522)

(1,373)

(2,149)

156.5%

NET OPERATING PROFIT (LOSS)

392,517

298,056

94,461

31.7%

Other charges and provisions

(39,606)

(23,616)

(15,990)

67.7%

Net income from investments

(3,999)

6,255

(10,254)

-163.9%

PROFIT (LOSS) BEFORE TAX FROM CONTINUING OPERATIONS

348,912

280,695

68,217

24.3%

Income tax for the period

(103,564)

(85,536)

(18,028)

21.1%

OPERATIONS

245,348

195,159

50,189

25.7%

PROFIT (LOSS) FOR THE PERIOD

245,348

195,159

50,189

25.7%

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

CONDENSED INCOME STATEMENT - QUARTERLY FIGURES

(Amounts in €thousand)

Year

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

1st Quarter

2nd Quarter

3rd Quarter

2019

2019

2019

2019

2019

2020

2020

2020

Net interest

281,277

70,366

71,401

69,806

69,704

68,164

70,065

68,645

Net fee and commission income

325,171

77,361

81,282

84,253

82,275

104,954

104,785

97,874

Net trading, hedging and fair value income

44,761

9,811

8,026

11,601

15,323

26,394

30,088

20,188

Net other expenses/income

3,608

196

341

147

2,924

570

822

169

OPERATING INCOME

654,817

157,734

161,050

165,807

170,226

200,082

205,760

186,876

Staff expenses

(90,152)

(21,653)

(22,444)

(22,497)

(23,558)

(24,007)

(24,886)

(24,647)

Other administrative expenses

(240,638)

(65,073)

(58,669)

(56,019)

(60,877)

(60,257)

(63,081)

(61,861)

Recovery of expenses

104,068

26,590

24,227

26,669

26,582

23,807

28,456

28,438

Impairment/write-backs on intangible and tangible assets

(22,864)

(5,144)

(5,366)

(5,783)

(6,571)

(6,058)

(6,210)

(6,373)

Operating costs

(249,586)

(65,280)

(62,252)

(57,630)

(64,424)

(66,515)

(65,721)

(64,443)

OPERATING PROFIT (LOSS)

405,231

92,454

98,798

108,177

105,802

133,567

140,039

122,433

commitments

(1,970)

(1,270)

1,124

(1,227)

(597)

(963)

(2,707)

148

NET OPERATING PROFIT (LOSS)

403,261

91,184

99,922

106,950

105,205

132,604

137,332

122,581

Other charges and provisions

(27,152)

(980)

(2,856)

(19,780)

(3,536)

(1,124)

(6,512)

(31,970)

Integration costs

-

(2)

2

-

-

-

-

-

Net income from investments

7,377

(658)

6,463

450

1,122

(89)

(3,729)

(181)

PROFIT (LOSS) BEFORE TAX FROM CONTINUING OPERATIONS

383,486

89,544

103,531

87,620

102,791

131,391

127,091

90,430

Income tax for the period

(95,121)

(27,272)

(31,689)

(26,575)

(9,585)

(39,960)

(38,348)

(25,256)

OPERATIONS

288,365

62,272

71,842

61,045

93,206

91,431

88,743

65,174

PROFIT (LOSS) FOR THE PERIOD

288,365

62,272

71,842

61,045

93,206

91,431

88,743

65,174

Starting from June 30th, 2020, revenues resulting from the Other Treasury activities are now accounted within the line "Net Interest" of the reclassified income statement. The activity, which started in 2020, generated €74,000 of revenues in the first quarter, which have been reclassified. Revenues related to this activity have been equal to €756,000 in the second quarter of 2020 and to €984,000 in the third quarter of 2020.

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

SOVEREIGN, SUPRANATIONAL AND AGENCY EXPOSURES

The following table indicates the book value of Sovereign, Supranational, Agency and local Authority exposures in debt securities at 31 March 2020 classified in the portfolio "Financial assets designated at fair value through other comprehensive income" and "Financial assets at amortised cost"; penetration on the Group's total assets totalled 53.55%.

(Amounts in € thousand)

Carrying value as at

% on total

September 30, 2020

asset

Italy

5,613,136

Financial assets at amortised cost

5,613,136

18.89%

Spain

4,081,593

Financial assets at amortised cost

4,081,593

13.73%

Germany

126,848

Financial assets at amortised cost

126,848

0.43%

Poland

27,360

Financial assets at amortised cost

27,360

0.09%

France

1,043,781

Financial assets at fair value through other comprensive income

37,162

0.13%

Financial assets at amortised cost

1,006,619

3.39%

U.S.A.

494,971

Financial assets at fair value through other comprensive income

69,010

0.23%

Financial assets at amortised cost

425,961

1.43%

Austria

520,060

Financial assets at amortised cost

520,060

1.75%

Ireland

915,097

Financial assets at fair value through other comprensive income

40,510

0.14%

Financial assets at amortised cost

874,587

2.94%

United Kingdom

21,920

Financial assets at amortised cost

21,920

0.07%

Belgium

559,651

Financial assets at amortised cost

559,651

1.88%

Portugal

396,342

Financial assets at amortised cost

396,342

1.33%

Switzerland

46,679

Financial assets at amortised cost

46,679

0.16%

Saudi Arabia

78,254

Financial assets at amortised cost

78,254

0.26%

Chile

20,133

Financial assets at amortised cost

20,133

0.07%

Israel

87,265

Financial assets at amortised cost

87,265

0.29%

Total sovereign exposures

14,033,090

47.22%

Financial assets at amortised cost - Supranational

1,335,907

4.49%

Financial assets at amortised cost - Agencies and Local Authority exposures

547,221

1.84%

Total Supranational, Agencies and Local Authority exposures

1,883,128

6.34%

Total

15,916,218

53.55%

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

OPERATING STRUCTURE

D ata as at

D ecember 31, 2019

September 30, 2020

No. Employ ees

1,225

1,251

No. Personal financial adv isors

2,541

2,577

No. Financial shops ¹

396

403

1 Number of Fineco Centers operational: Fineco Centers managed by the Bank and Fineco Centers managed by personal financial advisors (Fineco Centers).

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

BASIS OF PREPARATION

This Consolidated Interim Financial Report as at 30 September 2020 - Press Release was prepared on a voluntary basis, to guarantee continuity with previous quarterly reports, as Legislative Decree 25/2016 implementing Directive 2013/50/EU eliminated the obligation for additional periodical financial reports other than the half year and annual ones.

This Consolidated Interim Financial Report as at 30 September 2020 - Press Release, as well as the press releases on significant events during the period, the market presentation on Q3 2020 results and the Database are also available on FinecoBank's website.

Items in the condensed tables of the balance sheet and income statement were prepared according to the models contained in Bank of Italy Circular 262 "Bank financial report: models and rules of compilation" issued by the Bank of Italy, to which were applied the reconciliations illustrated in the "Reconciliation models for the preparation of condensed consolidated financial report" annexed to the consolidated half year report at June 30th 2020.

In order to provide additional information on the Bank's performance, several alternative performance indicators have been used - APM (such as Cost/income ratio, Cost of Risk, Guided products & services/AUM and Guided products & services/TFA), whose description is found in "Glossary of technical terminology and acronyms used" of the 2019 Financial Statements, in line with the guidelines published by the European Securities and Markets Authority (ESMA/2015/1415) on 5 October 2015.

The information contained in this Consolidated Interim Financial Report as at 30 September 2020 - Press Release was not prepared in accordance with the international accounting standard applicable to interim financial reports (IAS 34).

The Consolidated Interim Financial Report at 30 September 2020 - Press Release, shown in reclassified format, was prepared on the basis of the IAS/IFRS in force today.

It should be noted that, in the application of the accounting policies, the management is required to make judgements, estimates and assumptions about the carrying amounts of certain assets and liabilities as well as the information regarding contingent assets and liabilities. Estimates and related assumptions take into account all information available at the reporting date of this document and are based on previous experience and other factors considered reasonable under the circumstances and have been used to estimate the carrying values of assets and liabilities not readily available from other sources. At this regard, the valuation of some items has been particularly complex due to the uncertainties linked to the evolution of the Covid-19 pandemic and to the measurement of the expected economic recovery, and as a consequence these valuations could change in unforeseeable way in the next periods.

With specific reference to the assessment of credit exposures, it should be noted that, with the entry into force of the IFRS9 accounting standard, the assessment of the same is based on prospective information and, in particular, on the evolution of the macroeconomic scenarios used in the calculation of the write-downs. In valuing its performing loans as at 30 September 2020, the Group considered an updated macroeconomic scenario to take into account the effects of the COVID19 crisis. Appropriate adjustments have been made to account for the mitigating effects of the support measures granted to customers. As regards the remaining counterparties, including the bond issuers, the write-downs have been calculated according to IFRS9 impairment models and their and their post-model overlay and adjustment rules ("post-model overlay and adjustment").

Finally, in line with European guidelines on the assessment of a significant increase in credit risk ("SICR"), the COVID-19 health emergency has not resulted in any change to the policies adopted by the Group for the assessment of the creditworthiness of credit exposures and their classification in Stages 1, 2 and 3. The same applies to measures taken in the context of the epidemic (such as suspension of loan instalment payments or late payments), which are not considered to be an automatic trigger for an SICR, nor an automatic trigger for classification as forborne exposures.

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

With regard to the assessment of the goodwill, Fineco brands and domains recorded in the financial statements, it should be noted that on 30 June 2020 the Bank carried out an analysis on the COVID-19 effects on the main parameters used in the valuation model (net profit and RWA relating to the years 2020 and 2021 as from baseline and stressed COVID-19 scenarios approved by the Board of Directors on 7 July 2020). The results did not highlight significant impacts on the value in use, confirming the positive outcome of the impairment test performed at 31 December 2019.

In cases in which the accounts did not fully reflect the reporting of items on an accruals "pro rata temporis" basis, such as administrative expenses, the accounting figure was supplemented by estimates based on the budget.

With regard to the contribution obligations referred to in the Deposit Guarantee Schemes Directive 2014/49/EU, contributions will be due and recognised in the third quarter of the year, in application of IFRIC 21.

With reference to contribution obligations pursuant to Directive 2014/49/EU (Deposit Guarantee Schemes - DGS) for 2020, costs were accounted in the item "Other charges and provisions" and include an estimate of the annual contribution to be paid to the Italian Interbank Deposit Protection Fund based on information available at September 30th, 2020.

With regard to the contribution obligations under Directive 2014/59/EU (Single Resolution Fund), in relation to which no contribution has been requested from the Bank until the year ended December 31, 2019, the amount of the annual ordinary contribution and the additional contribution requested to FinecoBank for 2020 have been booked into the item "Other charges and provisions" .

This Consolidated Interim Financial Report as at 30 September 2020 - Press Release was not audited by the External Auditors.

CERTIFICATIONS AND OTHER COMMUNICATIONS

Related-Party Transactions

With reference to paragraph 8 of Article 5 "Disclosure of related-party transactions" of the Consob Regulation on related-party transactions (adopted by Consob with resolution no. 17221 of 12 March 2010 and subsequently amended with Resolution no. 17389 of 23 June 2010), please note that in the third quarter of 2020 minor intercompany transactions and/or transactions with related parties in general, both Italian and foreign, were conducted within the ordinary course of business and related financial activities of the Bank, and were carried out under arm's length conditions, i.e. conditions similar to those applied to transactions with unrelated third parties.

During the same period, no other transactions were undertaken with related parties that could significantly affect the Bank's asset situation and results, or atypical and/or unusual transactions, including intercompany and related party transactions.

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

DISCLAIMER

This Press Release may contain written and oral "forward-looking statements", which includes all statements that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward- looking statements rely on a number of assumptions, expectations, projections and provisional data concerning future events and are subject to a number of uncertainties and other factors, many of which are outside the control of FinecoBank S.p.A. (the "Company"). There are a variety of factors that may cause actual results and performance to be materially different from the explicit or implicit contents of any forward-looking statements and thus, such forward-looking statements are not a reliable indicator of future performance. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. The information and opinions contained in this Press Release are provided as at the present date and are subject to change without notice. Neither this Press Release nor any part of it nor the fact of its distribution may form the basis of, or be relied on or in connection with, any contract or investment decision.

The information, statements and opinions contained in this Press Release are for information purposes only and do not constitute a public offer under any applicable legislation or an offer to sell or solicitation of an offer to purchase or subscribe for securities or financial instruments or any advice or recommendation with respect to such securities or other financial instruments. None of the securities referred to herein have been, or will be, registered under the U.S. Securities Act of 1933, as amended, or the securities laws of any state or other jurisdiction of the United States or in Australia, Canada or Japan or any other jurisdiction where such an offer or solicitation would be unlawful (the "Other Countries"), and there will be no public offer of any such securities in the United States. This Press Release does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States or the Other Countries.

Declaration of the Nominated Official in charge of drawing up company accounts

The undersigned Lorena Pelliciari, as Nominated Official in charge of drawing up Company Accounts of FinecoBank S.p.A.,

DECLARES

in compliance with the provisions of the second paragraph of Article 154-bis of the "Consolidated Finance Act", that the accounting information contained in this Consolidated Interim Financial Report at September 30th, 2020 corresponds to results in the Company's accounts, books and records.

Milan, November 9th, 2020

The Nominated Official in charge of drawing up the Company's Accounts

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

TOTAL NET SALES - OCTOBER 2020

In October Fineco recorded strong and robust net sales, almost doubled on a yearly basis at € 739 million (+91% compared to € 387 million in October 2019), gathered without short-term commercial incentives. Asset mix reflects the postponement to the second half of the month of the availability of new investment products by FAM, due to the increase of the time needed by the Irish regulator for the approval during this complex market phase: Asset under Management stood at € 151 million, Asset under Custody at € 23 million while deposits were € 565 million.

Brokerage growth confirms its structural trend, thanks to both the reshaping of our offer and the enlargement of the base of clients, despite a lower volatility for most of the month. In October revenues were estimated at € 14 million, increasing by 12% comparing to October 2019, which recorded the best result last year. Estimated revenues since the beginning of the year reached around € 192 million, +75% y/y.

figures in € million

TOTAL NET SALES

OCT 2020

OCT 2019

JAN-OCT '20

JAN-OCT '19

Assets under management

151.4

516.7

2,755.4

2,436.5

Assets under custody

22.8

3.9

2,846.0

-598.2

Direct deposits

564.7

-133.6

1,488.5

2,896.7

TOTAL NET SALES

738.9

386.9

7,089.8

4,735.0

TOTAL FINANCIAL ASSETS

OCT 2020

DEC 2019

OCT 2019

Assets under management

41,855.8

40,505.4

38,900.7

Assets under custody

16,346.9

15,323.8

15,312.5

Direct deposits

26,996.8

25,589.7

24,965.7

TOTAL FINANCIAL ASSETS

85,199.5

81,418.8

79,178.9

Total financial assets over € 85 billion, net sales since the beginning of the year over € 7 billion

Total financial assets were at € 85,2 billion, +8% compared to October 2019.

Since the beginning of the year, total net sales stood at € 7.1 billion (+50% y/y), of which € 2.8 billion in AuM,

  • 2.8 billion in AuC and € 1.5 billion in deposits.

FAM, retail net sales since the beginning of the year at € 1.6 billion

Fineco Asset Management retail net sales amounted in October to € 114 million. As of October 31st, 2020 FAM managed € 14.9 billion of assets, of which € 9.6 billion retail class (+24% y/y) and € 5.3 billion institutional class (+1% y/y).

Guided Products & Services 2020 net sales above € 2.8 billion

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

Net sales in "Guided products & services" in October amounted at € 160 million. Since the beginning of the year net sales totaled € 2.8 billion (+1% y/y). The penetration rate of Guided Products reached 73% on total AuM compared to 70% a year ago.

Over 8,000 new clients in the month

In October 8,010 new clients have been acquired, confirming the trend highlighted after the announcement of the Smart Repricing on our banking services with a better quality of new customers, and an increase in average TFA of new current accounts. Total number of customers reached 1,363,578 as of October 31st, 2020.

figures in € million

PFA NETWORK NET SALES

OCT 2020

OCT 2019

JAN-OCT '20

JAN-OCT '19

Assets under management

154.1

515.1

2,770.0

2,445.7

Assets under custody

30.1

-16.5

2,036.2

-460.3

Direct deposits

480.9

-111.1

1,375.2

2,228.8

TOTAL NET SALES

665.2

387.4

6,181.5

4,214.2

PFA NETWORK TFA

OCT 2020

DEC 2019

OCT 2019

Assets under management

41,409.4

40,012.3

38,419.7

Assets under custody

12,193.2

11,467.4

11,523.1

Direct deposits

20,501.6

19,207.7

18,796.4

TOTAL FINANCIAL ASSETS

74,104.2

70,687.3

68,739.1

FinecoBank

FinecoBank is one of the most important FinTech banks in Europe. Listed on the FTSE MIB, Fineco offers a business model that is unique in Europe, combining the best platforms with a large network of financial advisors. It offers a single account with banking, trading and investment services, on transactional and advisory platforms developed with proprietary technologies. Fineco is a leading bank in brokerage in Europe, and one of the most important players in Private Banking in Italy, offering advanced and tailor-made advisory services. Since 2017, FinecoBank has also been in the UK with an offer focused on brokerage, banking and investment services. Fineco Asset Management was founded in Dublin in 2018, with a mission to develop investment solutions in partnership with top international asset managers

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Consolidated Interim Financial Report

at September 30th, 2020 - Press Release

Enquiries

Fineco - Media Relations

Fineco - Investor Relations

Tel.: +39 02 2887 2256

Tel. +39 02 2887 3736/2358

mediarelations@finecobank.com

investors@finecobank.com

Barabino & Partners

Tel. +39 02 72023535

Emma Ascani

e.ascani@barabino.it

+39 335 390 334

20

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Finecobank S.p.A. published this content on 09 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 November 2020 13:41:04 UTC