MONETA Money Bank : Interim report for 3Q 2022, consolidated

Mandatory Disclosure

PUBLIC DISCLOSURE OF INSIDE INFORMATION

MONETA Money Bank, a.s.

Consolidated financial report as of and for the

nine months ended 30 September 2022

MONETA Money Bank, a.s. Consolidated financial report

as of and for the nine months ended 30 September 2022 (All amounts in CZK millions unless otherwise stated)

Contents

1	Disclaimer ................................................................	3
2	Letter from the CEO .................................................	4
3	Key Performance Indicators.....................................	9
4	Macroeconomic Environment ...............................	10
5	Group Performance ...............................................	12
	5.1	Business performance .........................................	12
	5.2	Financial Performance.........................................	12
	5.3	Outlook for 2022 and risks...................................	13

1. Basic Information about MONETA Money Bank, a.s.
   ............................................................................... 14
2. Condensed Consolidated Interim Financial Statements for the Three and Nine-month Period

Ended 30 September 2022 (Unaudited) ................	16
7.1	Condensed Consolidated Statements of Profit or
	Loss and Other Comprehensive Income for the
	Three and Nine-month Period Ended 30
	September 2022 (Unaudited)..............................	16
7.2	Condensed Consolidated Statement of Financial
	Position as at 30 September 2022 (Unaudited) .. 17

7.3 Condensed Consolidated Statement of Changes in Equity for the Nine-month Period Ended 30

	September 2022 (Unaudited)..............................	18
7.4	Condensed Consolidated Statement of Cash Flows
	for the Nine-month Period Ended 30 September
	2022 (Unaudited) ................................................	19
8 Notes to Unaudited Condensed Consolidated
Interim Financial Statements .................................	21
8.1	Reporting Entity ..................................................	21
8.2	Basis of Preparation and Presentation ................	21
8.3	Use of Judgements and Estimates.......................	21
8.4	Significant Accounting Policies ............................	22
8.5	Consolidation Group ...........................................	23
8.6	Dividends Paid.....................................................	23
8.7	Net interest income.............................................	24

8.7.1 Analysis of deferred costs and fees directly attributable to origination of new loan products that are integral part of the effective interest rate and fair value adjustment resulting from revaluation of acquired financial

assets for a three and nine-month period .....	25
8.8 Net fee and commission income .........................	27
8.9 Total operating expenses ....................................	27
8.10 Investment securities ..........................................	27
8.11 Loans and receivables to banks...........................	28
8.12 Loans and Receivables to Customers ..................	28
8.13 Due to banks and Due to customers ...................	28
8.14 Issued bonds........................................................	29
8.15 Subordinated Debt Issued ...................................	30
8.16 Legal Risks ...........................................................	31

8.16.1	Legal disputes .....................................	31
8.17 Segment Reporting..............................................	31
8.18 Related parties ....................................................	33
8.19 Risk management ................................................	35
8.19.1	Capital Management...........................	35

1. Loans and receivables to banks and customers according to their categorisation . 37
2. Walk of allowances to Loans and

receivables to customers ...............................

38

8.19.4 Break-down of allowances according to

loan type and stages ......................................

40

8.19.5 Coverage of non-performing loans and

	receivables.....................................................	41
	8.19.6	Net impairment of financial assets .....	41
	8.19.7	Maximum credit risk exposures ..........	42
8.20 Fair values of financial assets and liabilities ........	44
8.21 Subsequent Events ..............................................	45
9	Management Affidavit ...........................................	46
10	Alternative Performance Measures .......................	47
11	Glossary	.................................................................	48

MONETA Money Bank, a.s. Consolidated financial report

as of and for the nine months ended 30 September 2022 (All amounts in CZK millions unless otherwise stated)

1 Disclaimer

Forward-looking statements

This report may contain projections, estimates, forecasts, targets, opinions, prospects, results, returns and forward-looking statements with respect to, the financial guidance, profitability, costs, assets, capital position, financial condition, results of operations, dividend and business (together, "forward-looking statements") of MONETA Money Bank, a.s. and its consolidated subsidiaries (the "Group" or "MONETA"). The forward-looking statements assume a purely organic growth without regard to any potential acquisition.

Any forward-looking statements involve material assumptions and subjective judgements which may or may not prove to be correct and there can be no assurance that any of the matters set out in forward looking statements will actually occur or will be realised or that such matters are complete or accurate. The assumptions may prove to be incorrect and involve known and unknown risks, uncertainties, contingencies and other important factors, many of which are outside the control of the Group. Actual achievements, results, performance or other future events or conditions may differ materially from those stated, implied and/or reflected in any forward-looking statements due to a variety of risks, uncertainties and other factors. Any forward-looking statement contained in this report is made as at the date of this report. The Bank does not assume, and hereby disclaims, any obligation or duty to update forward-looking statements if circumstances or management's assumptions beliefs, expectations or opinions should change, unless it would be required to do so under applicable law or regulation. For these reasons, recipients should not place reliance on, and are cautioned about relying on, any forward-looking statements.

Dividend Guidance

Subject to corporate, regulatory and regulator's limitations, the Bank's target is to distribute the Group's excess capital above that required to meet the Group's internal target of the capital adequacy ratio, which is currently 15.6% (effective since 1 October 2022). However, the internal capital

adequacy ratio target is not legally binding upon the Group and is subject to change on the basis of the ongoing re-assessment by the Management Board of the Bank based on the business results and development.

Material assumptions for forward-looking statements

When preparing Guidance for 2022-20251 MONETA has made several economic, market, operational, regulatory and other assumptions of both quantitative and judgemental nature. These assumptions include the following:

• Gradual recovery of the Czech economy after COVID-19 pandemic impacts.
• 1M PRIBOR assumed to decrease from
  4.7% in 2022 to 2.7% in 20252.
• Gross performing loan balance is expected to grow at 6.2% CAGR in the 4 years until 2025.
• Customer deposits balance is expected to grow at 6.5% CAGR in the 4 years until 2025.

Third parties' data

Certain industry and market information in this report has been obtained by the Bank from third party sources. The Bank has not independently verified such information and the Bank does not provide any assurance as to the accuracy, fairness or completeness of such information or opinions contained in this report.

1. Five-yearguidance published on 4th February 2022.
2. Internal forecast derived from macroeconomic forecast from CNB published on November 2021 https://www.cnb.cz/en/monetary- policy/forecast/cnb-forecast-archive/CNB-forecast-Autumn-2021/

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MONETA Money Bank, a.s. Consolidated financial report

as of and for the nine months ended 30 September 2022 (All amounts in CZK millions unless otherwise stated)

2 Letter from the CEO

Dear Shareholders,

It is eight months since Russia invaded Ukraine, the ramifications of which continue to spread. In recent weeks Ukraine, financed and armed by the US and democratic Europe, has succeeded in liberating hundreds of square kilometres of its territory from Russian occupation. The Kremlin responded, on 21 September, by announcing a partial mobilisation. More darkly, at a Moscow ceremony to mark the illegal annexation of four regions of Ukraine, the Kremlin raised the spectre of nuclear options. Russia's aggression and its attendant weaponization of the energy markets are palpable, stoking inflation and causing a deterioration of the economic environment across Europe and in the Czech Republic, which is affecting everyone.

International economic sanctions against Russia have been broadened and tightened, including the introduction of a price cap on Russian oil sales. Visa regimes now prevent most Russian citizens from entering the European Union (EU). And Europe has worked to secure alternatives to Russian gas. Turmoil in the energy market has driven end-user prices sky high, which in turn has driven inflation. Consumer prices in the 19 eurozone countries reached

9.9 per cent in September, up from 9.1 per cent in August, while in the Czech Republic the inflation stood at 18 per cent in September 2022 compared to September 2021.

Policy makers have reached for various tools to tackle inflation and to ease the impact of energy price rises. The European Central Bank (ECB) increased its main interest rate to 1.25 per cent in late July, while the Czech National Bank (CNB) held its key two-week repo rate at 7 per cent. This decision was in line with expectations given the new composition of the CNB Board but nevertheless remains at its highest level since 1999. European governments have sought to cap energy prices, provide support for households and to raise tax revenues to help fund energy measures.

MONETA performed well in the third quarter and, it is fair to say, has had a good nine months, in line with the guidance that we published on 4 February 2022. It is, however, difficult to assess future developments given the economic uncertainties wrought

by the inflationary environment and the approach of winter, when demand for energy will surge.

Moreover, continuing Russian aggression against Ukraine may well have further economic consequences for the Czech Republic and Europe as a whole.

WINDFALL TAX

The Czech finance minister, Zbynek Stanjura, on 6 October announced proposals for a tax on windfall profits in the energy and banking sectors, effective 1 January 2023, and applicable in the years 2023, 2024 and 2025. The ministry expects this tax to bolster the public purse to the tune of CZK 85 billion next year alone, of which CZK 33 billion would be from the six largest banks, among them MONETA. We do not yet understand the calculations that lay behind the ministry's stated expectations, and in any event more analysis will be required. However, the outlined proposals, which are subject to parliamentary debate and approval, will have implications for the banking business. Should the proposal in its current form be approved by parliament, we expect that the Bank's effective tax rate would increase from the current

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MONETA Money Bank, a.s. Consolidated financial report

as of and for the nine months ended 30 September 2022 (All amounts in CZK millions unless otherwise stated)

20 per cent to an average of 30 per cent for the impacted years.

CURRENT ECONOMIC ENVIRONMENT

Russia's war against Ukraine continues to overshadow the economic environment and to influence policy making across Europe. The Czech government has taken steps to diversify gas supplies and to manage the impact of energy prices. In September a significant agreement with the Netherlands was reached for a liquefied natural gas (LNG) floating terminal that will cover up to one-third of annual Czech gas consumption. The government has introduced price 'ceilings' on gas and electricity for households and small businesses. Energy company profits on the sale of electricity above a certain level are likely to be capped in line with EU proposals, which will generate significant revenues for the state budget. On top of this comes the finance ministry's proposed windfall taxes.

Annual average inflation in September was

12.7 per cent and the CNB forecasts that inflation may head towards 20 per cent this autumn as energy price rises take effect and will likely average 16.5 per cent for the full year. That is why the CNB says that interest rates will remain high for some time, with the CNB Board stating that when it next meets it will decide if rates will "remain unchanged or increase." Major central banks are raising their key rates: the ECB has sharply increased its rate for the first time since 2015, to 0.5 per cent in July and to 1.25 per cent in August. Central banks across Central Europe and in all other non-Eurozone countries have each raised their key interest rates. And the US Federal Reserve has announced that it is increasing the federal funds interest rate to a target range of 3.0 to 3.25 per cent.

The CNB forecasts that the Czech economy will contract in the second half of this year due to strong inflationary and demand pressures. Although GDP grew year-on-year by a reasonable 3.7 per cent in the second quarter, the CNB's growth outlook for 2022 comes in at

2.3 per cent. The slow-down in growth is largely down to a dampening in household consumption due to "high energy and fuel prices, negative sentiment and higher interest rates." Businesses face similar pressures, which will slow investment growth. The CNB also notes a slowdown in external demand for Czech goods and services, with foreign trade now having a negative effect on GDP. The country's trade balance for the year is heading towards a deficit of 4.6 per cent of GDP,

which, in absolute terms would be the highest in history.

On the other hand, unemployment in the Czech Republic, although rising slightly, remains the lowest in the EU, at 2.5 per cent. Industrial production has remained resilient despite inflationary pressures from increased costs, and supply-chain challenges. Nominal wage growth stands at 4.4 per cent, but thanks to inflation the real wage is actually negative, at -9.8 per cent, further exacerbating household consumption and consumer sentiment. Throughout the period under review the koruna has remained stable at around 24.5 CZK/EUR, and the CNB intends to keep it that way, stating that it will "continue to prevent excessive fluctuations of the koruna".

The government of Prime Minister Petr Fiala has so far managed to balance its intentions to run conservative and prudent fiscal policies with its obligations to support the population against the full brunt of soaring heating and energy bills. The cost of this balancing act can be seen in the state budget deficit, which is now expected to reach CZK 375 billion for the full year, up from the previously envisaged CZK 280 billion. As of September, it stood at CZK 270.9 billion. The electorate seem to accept the government's approach, for despite some noisy outbursts of populism and an animated opposition, the governing coalition performed well in September's municipal and Senate elections, and in fact won enough new Senate seats to secure a comfortable majority in the upper house.

I will now turn to MONETA's performance in the third quarter of this year.

3Q 2022 FINANCIAL PERFORMANCE

MONETA has continued to outperform the business plan that we set for 2022, with solid overall portfolio and deposit growth in the third quarter, which is reflected in the financial results that we are reporting today.

Our operating income was better than expected, with market rates helping our net interest income to rise by 14.6 per cent against the same period last year.

Net fee and commission income increased by

9.3 per cent, mainly thanks to commissions from third-party products. Other operating income decreased by 26.7 per cent and the decline was mainly driven by lower income from financial operations. Overall, total operating income was CZK 9.1 billion, an increase of 11.6 per cent year-on-year.

Our operating expenses remained stable at CZK 4.2 billion, despite inflationary pressures, as we maintained cost discipline across all of our businesses.

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