SIF Banat Crisana : Annual Report of the Board of Directors for 2021 – (as presented in the OGM of April 28, 2022) includes the standalone financial statements, independent auditor’s report, remuneration report for 2021 FY) for the year ended December 31, 2021

PREPARED PURSUANT TO LAW NO. 24/2017, LAW NO. 74/2015, LAW NO. 243/2019,

ASF REGULATION NO. 5/2018, ASF REGULATION NO. 10/2015, ASF REGULATION NO. 7/2020

AND ASF RULE NO. 39/2015

This Report of the Board of Directors is provided as a free translation from Romanian, which is the official and binding version. In case of inconsistencies between the information provided in Romanian and those provided in English, Romanian language shall prevail.

CONTENTS

MAIN FINANCIAL AND OPERATIONAL INFORMATION

GENERAL INFORMATION ON THE COMPANY

2 3

1. ANALYSIS OF SIF BANAT-CRIȘANA ACTIVITY

4

Economic environment

4

Analysis of the portfolio

6

Net asset value (NAV) evolution Portfolio structure

8

10

Stock portfolio management

13

Risk management

21

Human resources

30

Tangible assets of the company Litigations

31

32

Perspectives for 2022

• 2. THE SHARES ISSUED BY SIF BANAT-CRIȘANA

• 3. CORPORATE GOVERNANCE

• 4. FINANCIAL ANALYSIS

Standalone financial position

Statement on the standalone profit and loss and other comprehensive income Standalone cash flow statement

• 5. OTHER SIGNIFICANT INFORMATION

• 6. EVENTS AFTER THE REPORTING PERIOD

• 7. PROPOSALS OF THE BOARD OF DIRECTORS

32 34 38 58 58 59 61 63 68 69

ANNEX 1	Standalone Financial Statements as of December 31, 2021, prepared pursuant to International
Financial Reporting Standards adopted by the European Union and ASF Rule no. 39/2015
ANNEX 2	Statement of SIF Banat-Crișana assets and liabilities as of December 31, 2021, and the detailed
statement of investments (as per Annexes no. 10 and 11 to Regulation no. 7/2020)
ANNEX 3	Compliance with the Code of Corporate Governance issued by BVB
ANNEX 4	Statement on the compliance with the principles of corporate governance as per
ASF Regulation no. 2/2016
ANNEX 5	Annual Report of the Nomination and Remuneration Committee
ANNEX 6	SIF Banat-Crișana's Remuneration Report for 2021
ANNUAL REPORT OF SIF BANAT-CRIȘANA BOARD OF DIRECTORS FOR THE FINANCIAL YEAR 2021|1

MAIN FINANCIAL AND OPERATIONAL INFORMATION

FINANCIAL POSITION [RONm]

Total assets, of which Total financial assets Equity

2019

2020

Total liabilities

2,926.68 2,900.02 2,748.20 178.47

2021

2,883.77 2,859.53 2,729.90 153.87

3,607.39 3,579.13 3,416.13 191.26

FINANCIAL PERFORMANCE (IFRS) [RONm]

Income

Gain on investment Expenses

Gross profit

Net profit for the year

2019

2020

121.54

94.84

75.95

27.82

22.24

28.47

175.26

94.18

2021

135.55

288.29

27.50

396.34

159.49

92.12

387.00

FINANCIAL INDICATORS [%]

ROE (net profit / equity)

ROA (net profit / total assets)

Gross profit margin (gross profit / total income)

2019 5.80 5.45 66.54

2020 3.37 3.19 30.47

2021 11.33 10.73 73.32

SHARES AND NET ASSET PERFORMANCE

Share price (year end, in RON) Net asset value* / share (RON) PER**

Dividend / share (RON) Accounting net asset / share (RON) Nominal value of share (RON) Number of issued shares Number of outstanding shares * calculated acc. to ASF regulations ** calculated using EPS for the average number of shares in the respective year *** as per GMS decision

OPERATIONAL DATA

2019

2.7300

5.2959

8.9

-

5.3411

0.1

517,460,724 514,542,363

2020

2.2000

5.6051

12.3

-

5.3055

0.1

515,422,363 514,542,363

2021

2.5400

6.7170

3.4

***

6.7311

0.1

515,422,363 507,510,056

Number of employees, year end Number of branch offices

2019 34 1

2020 34 1

2021 33 1

SHAREHOLDING STRUCTURE as of December 31, 2021

Romanian individuals Non-resident individuals Romanian legal entities

SIF Banat-Crișana (treasury stock)* Non-resident legal entities

TOTAL

* repurchased in 2021

number of shareholders

5,741,881

2,095

118

1

25 5,744,120

stake

39.98%

0.35%

37.84%

1.54%

20.29% 100%

COMPANY NAME

Societatea de Investiții Financiare Banat-Crișana S.A. (hereinafter referred to as "SIF Banat-Crișana" or "the Company")

COMPANY TYPE

• ▪ joint stock company, Romanian legal entity with entire private capital

• ▪ established as a self-managed investment company, authorized by the Financial Supervisory Authority as Alternative Investment Fund Manager (AIFM) - Authorization no. 78 / 09.03.2018, and as closed-ended alternative investment fund, diversified, addressed to retail investors (AIFRI) - Authorization no. 130 / 01.07.2021

SHARE CAPITAL

• ▪ RON 51,542,236.30 - subscribed and paid-in capital

• ▪ 514,422,363 shares issued; 507,510,056 outstanding shares as of December 31, 2021

• ▪ RON 0.10 per share nominal value

REGISTRATIONS

• ▪ Number in Trade Register J02/1898/1992

• ▪ Tax Identification Code RO 2761040

• ▪ Number in ASF AFIAA Register PJR07.1AFIAA / 020007 / 09.03.2018

• ▪ Number in ASF FIAIR Register PJR09FIAIR / 020004 / 01.07.2021

• ▪ Legal Entity Identifier (LEI) 254900GAQ2XT8DPA7274

MAIN ACTIVITY

Main activity is, as per the classification of economic activities in the national economy (CAEN): financial intermediation, except for insurance and pension funds (CAEN code 64), and the main object of activity: Other financial intermediation n.c.a. (CAEN code 6499):

• ▪ portfolio management

• ▪ risk management;

• ▪ other activities carried out within the collective management of an investment fund, allowed by the legislation in force.

TRADING MARKET

The company is listed since November 1, 1999, on the regulated market of Bucharest Stock Exchange (BVB or BSE) - Premium category - ticker SIF1

FINANCIAL AUDITOR DEPOSITARY BANK

Deloitte Audit S.R.L.

Banca Comercială Română (BCR)

SHARES AND SHAREHOLDERS' REGISTER

Depozitarul Central S.A. Bucharest

HEADQUARTERS

Arad, 35A Calea Victoriei, 310158, Romania TEL [phone] FAX [phone] [e-mail] WEB www.sif1.roBRANCH

SIF Banat-Crișana SA Arad-Bucharest Branch-Rahmaninov

46-48 S. V. Rahmaninov Str., 3rd floor, sector 2, 020199, Bucharest

CONTACT Investor Relations: [e-mail] tel [phone]

1. ANALYSIS OF SIF BANAT-CRIȘANA ACTIVITY

Economic environment

Domestic economic environment

Macroeconomic indicators in Romania have evolved divergently in recent times, following the negative impact on economy generated on the one hand by the pandemic situation and the significant increases in consumer goods prices fuelled by consistent surges in energy, food, and non-commodity prices, and on the other hand by the military offensive launched by Russia against Ukraine on February 24, 2022.

The service sector continued to be severely impacted in 2021 by the measures to halt the spread of SARS-CoV-2 disease. The sharp rise in inflation has prompted central banks to adopt a more cautious monetary policy and raise interest rates. In the first part of 2021, the National Bank of Romania reduced by a step the reference interest rate from 1.50% to 1.25%, to support the economy affected by the pandemic, but against the background of a strong inflationary trend, it adjusted monetary policy from dovish to hawkish. In H2 2021, NBR raised the monetary policy interest rate in two stages from 1.25% to 1.75%. At present, the monetary policy rate set by the NBR is 2.50%, but the symmetrical corridor consisting of interest for the deposit facility (which is currently at 1.50%) and interest for the lending facility (3.50%) has been extended.

The unemployment rate remained at a reasonable level, and the number of insolvencies (especially among HoReCa companies) increased at a moderate pace. The latest data published by the National Institute of Statistics showed an unemployment rate in December 2021 of 5.4% compared to the 6.4% reported by the European Union and a slight increase in the number of insolvencies compared to 2020.

After a slowdown of -3.7% in 2020, the progress of real GDP (adjusted for inflation) in 2021 was 5.9%, according to data revised in March 2022 and published by INS. The advance was largely supported by household consumption and investments while exports made a negative contribution. Towards the end of 2021, the growth slowed down due to supply chain constraints, the new wave of SARS-CoV-2 infections and the sharp rise in inflation.

The annual consumer price index for 2021, reported by INS, was 5.1% (up from 2.6% in 2020), a distance that deviated from the multi-annual stationary inflation target adopted by the ECB and NBR of 2,5%, aimed at ensuring price stability and moving to the EU's long-term continuing inflation target.

Foreign direct investment amounted to 7.25 billion euros in 2021 (compared to 3 billion euros in 2020) of which equity investments (including estimated net reinvested profit) amounted to a net value of 5.78 billion euros, and intragroup loans amounted to 1.47 billion euros.

At the same time, NBR reported that the current account deficit significantly deepened, exceeding 16.95 billion euros in 2021, compared to 10.98 billion euros in the previous year. The current account deficit and the public debt were also expanding, but the limits on the deficit thresholds were temporarily raised in order to intervene effectively during the health crisis caused by the spread of the SARS-CoV-2 virus.

The course of the local currency against the euro had moderate changes but with a slightly downward trend, resulting in an average annual exchange rate of RON 4,9204 / EUR in 2021 compared to RON 4,8371 / EUR in 2020. In relation to the US dollar, the evolution of the exchange rate can be considered relatively stable, the annual average in 2021 being at RON 4.1604 / USD compared to 4.2440 in the same period of 2020. There were no excessive volatilities of exchange rate.