HPB dd : 2016 – the year of new services and growing market shares

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Ured za korporativne komunikacije Jurišićeva 4, HR-10000 Zagreb

Press Release

HPB

2015 - the year marked by the strengthening of the capital and new organisation 2016 - the year of new services and growing market shares

Zagreb, 21 December 2015 - The priority for Hrvatska poštanska banka in 2016 is the acquisition of younger population, development of noninterest business and application of new technologies with higher quality services to customers

In Hrvatska poštanska banka 2015 was marked by 1. preparations and implementation of recapitalization; 2. new organisation; 3. excellent business results and 4. growth in number of customers.

Recapitalization: In June, the Bank's capital was increased by conversion of hybrid instruments by HRK 252 million, and in September by issuing new shares by additional HRK 550 million; the total capital now stands at HRK 1.7 billion. The Bank achieved the capital adequacy ratio of 16.5% (2.5 percentage points higher than the regulatory prescribed rate of 14%). The Management Board of the Bank successfully presented to the European Commission in Brussels the business plan based on the Market Economy Operator principle, and the private investors who paid HRK 305 million almost doubled the amount demanded by the European Commission in order that the HPB's recapitalization could be considered market compliant.

Business results and reorganisation: At the same time, the best business result has been achieved in the history of the Bank - with the record net profit in the nine months of 2015 of HRK 107 million. C/I ratio has been improved to 54.8% following the years it has been falling behind the market average. The reorganisation of the Bank was completed on 1 October 2015 when the number of units within the Bank was reduced from 94 to 71 which would add to faster and more efficient operation.

Growth in number of customers and market shares: The Bank has 640 thousand customers and this number shows a growing trend. While the market is stagnating, in HPB the loans to individuals grew in September 2015 by 7.4% compared to the last year, and the

Hrvatska poštanska banka, dioničko društvo  Jurišićeva 4, 10000 Zagreb, Hrvatska  tel.: [phone]  [e-mail]  www.hpb.hr Uprava Banke: Tomislav Vuić, predsjednik  Dubravka Kolarić, član  Mladen Mrvelj, član  Domagoj Karadjole, član  predsjednik Nadzornog odbora: Dražen Kobas  IBAN: HR46 2390 0011 0700 0002 9  SWIFT: HPBZHR2X  OIB: 87939104217  Upis kod Trgovačkog suda u Zagrebu pod br. MBS: 080010698  Temeljni kapital 1.214.775.000,00 kn, podijeljen na 2.024.625 redovnih dionica u nominalnom iznosu 600,00 kn (uplaćen u cijelosti)

market share was increased from 3.4 to 3.6%. The savings of individuals are also growing in HPB faster than the market - the individuals' deposits grew by 2.7% in contrast to the market growth of 1.7%. In 2015 more than 300.000 new current accounts were opened and almost

1.200 of new corporate accounts.

Priorities in 2016: In the next year, the priority for HPB in the retail segment is to improve the quality of services and to increase the number of clients, as well as the mass market and acquisition of younger population, while in the corporate segment the focus will be on the small and medium businesses.

«To improve financial results and increase market shares primarily in retail banking and home loans is our strategic plan, as well as to increase the quality and to further specialise in small and medium enterprise segment. We will develop noninterest income and focus more seriously on modern technologies, new sales channels and nonbanking competition entering the market traditionally reserved only for the banks. We continue to successfully implement the project of cooperation with the Croatian Post and expect the growth in sales and better results of both, the Post and the Bank", announced Mr. Tomislav Vuić, President of the Management Board of Hrvatska poštanska banka at the pre-holiday gathering with journalists.

Media Relations

HPB Office of Corporate Communications 01 4804 920/473, 4805 057

[e-mail] www.hpb.hr

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