2 0 0 5 g r o u p r e s u l t s

2 0 0 5 G R O U P R E S U L T S

Milan, Borsa Italiana - 31 March 2006

2

Results at a glance

2005 Target 2004 Change

Net Income 171.0 142.7 19.8%

EPS 0.150 0.128 17.2%

EPS (ITAGAAP) 0.110 0.104 5.8%

EVA 85.0

ROE 14.6% 13.7% +0.9 p.p.

Cost/Income 66.2% 66.9% -0.7 p.p.

Cost/Income (ITAGAAP) 65.4% 65.1% 0.3 p.p.

Tier 1 ratio 5.11% 5.07% 0.03 p.p.

Total Capital ratio 9.29% 9.89% -0.6 p.p.

3

Results per Segments (Euro million)

Wealth Management

Net income 30 24 +22.7%

Equity 82 68 +22.2%

RORAC 36.0% 35.9% +0.2 pp

Cost/Income 27.2% 30.4% -3.2 pp

2005 2004 Change

2005 2004 Change

Contribution to thenet income1

58%15%

17%

7%

7%

Retail

Other (HQ)

WealthMngt.

Finance

Corporate&

Private Bkg.

1 - Net income + minorities

Retail

Net income 117 75 +55.0%

Equity 468 435 +7.6%

RORAC 25.0% 17.3% +7.6 pp

Cost/Income 71.1% 72.7% -1.6 pp

Corporates & Private Bkg.

Net income 34 32 +5.1%

Equity 246 223 +10.4%

RORAC 13.7% 14.4% -0.7 pp

Cost/Income 57.6% 55.1% +2.5 pp

Finance

Net income 15 15 ---

Equity 109 112 -2.6%

RORAC 13.6% 13.0% +0.6 pp

Cost/Income 35.9% 37.0% -1.1 pp

4

Interest Margin: +8.2%

Significant interest margin increase which confirms the recovery detected in the previous quarters

Stable average rates

Volume increases

Change2005 2004

Euro million

2005 2004Euro

millionChange

Customers 520.6 482.3 38.3 7.9%

Interest charged 606.6 566.7 39.9 7.0%

Interest paid -86.0 -84.4 -1.6 1.9%

Securities -27.7 -30.8 3.1 -10.1%

Banks 10.0 13.3 -3.3 -24.8%

NET INTEREST INCOME 502.9 464.8 38.1 8.2%

Average outstandings

(Euro mn.)

Annualized average rates

Average outstandings

(Euro mn.)

Annualized average rates

Avg. Outstandings

Rates

Interest bearing assets 17,061 4.12% 16,247 4.08% 5.0% 0.04 pp

Interest bearing liabilities 16,308 1.43% 15,444 1.42% 5.6% 0.01 pp

5

Gross Total Income: +3.2%

Commissions

stable year-on-year

in 2005 commissions have been penalised by the application of the amortized cost method

commissions pertaining to AUC and AUM benefited from volume increases.

Shareholdings have performed well

The consolidation of Findomestic with the equity method was penalised by the application of the IAS/IFRS: Euro 9 million in P&L

In 2005 the insurance activity was penalised by the fair value option and by consolidation method changes for certain accounting posts.

Euro million

2005 2004Euro

millionChange

Net commissions 327.5 329.0 -1.5 -0.5% Current accounts &

deposits 82.8 88.5 -5.7 -6.4%

AUC 10.0 9.4 0.6 6.4%

AUM 92.5 84.4 8.1 9.6%

Other 142.2 146.7 -4.5 -3.1%

Dividends & shareholdings income 67.6 59.0 8.6 14.6%of which

Findomestic 53.0 52.5 0.5 1.0%

Financial assets & liabilities 42.8 46.4 -3.6 -7.8%

Net result of the insurance activity 4.6 16.9 -12.3 -72.8%

GROSS TOTAL INCOME 945.4 916.1 29.3 3.2%

6

Operating Profit: +9.1%

Cost of credit still under control

Curbed operating costs growth (+2,2%)

Administrative expenses up 4,2% due to the:

renewal of the national labour contract

first time posting of the contributions to the parent company’s supplementary pension fund

stamp duties increases

migration of the IT systems of CR Mirandola and CR Spezia

Euro million

2005 2004Euro

millionChange

Net value adjustments -56.4 -62.2 5.8 -9.3%

Loans -53.5 -59.9 6.4 -10.7%

AFS assets -1.5 -2.3 0.8 -34.8%

Other fin. transactions -1.4 0.0 -1.4

TOTAL INCOME 889.0 853.9 35.1 4.1%

Operating costs -625.9 -612.7 -13.2 2.2%

Administrative exp. -616.1 -591.3 -24.8 4.2%

Personnel -389.4 -375.3 -14.1 3.8%

Other expenses -226.7 -216.0 -10.7 5.0%

Adj. to tangible &

intangible assets -54.6 -59.5 4.9 -8.2%

Other income 44.8 38.1 6.7 17.6%

OPERATING PROFIT 263.1 241.2 21.9 9.1%

7

Group Net Income: +19.8%

Prudent provisions for risks & charges

Other revenues have risen thanks to the income of the product companies

The tax rate decreased thanks to the fiscal benefit on the re-evaluation of fixed assets

Euro million

2005 2004Euro

millionChange

Provisions for risks & charges -17.3 -9.3 -8.0 86.0%

Other operating costs & revenues 16.7 12.4 4.3 34.7%

PRE-TAX INCOME 262.5 244.3 18.2 7.4%

Taxes -59.8 -79.6 19.8 -24.9%

Minorities -31.7 -22.0 -9.7 44.1%

GROUP NET INCOME 171.0 142.7 28.3 19.8%

8

Total Financial Assets: + 5.8%

9.28.7

5.55.1

1.01.1

2004 2005

Customer deposits

Bonds

Other + 8.7%

+ 7.6%

+ 5.8%

4.84.7

3.02.6

2.72.6

2004 2005

Mutual funds

Discr. accounts

Insurance + 6.4%

+ 15.5%

+ 0.8%

2005 2004 Change

Direct Funding 15,752.6 14,955.5 5.3%

2005 2004 Change

Indirect Funding 20,131.7 18,975.7 6.1%

TOTAL FIN. ASSETS 35,884.3 33,931.2 5.8%

9

Customer loans: + 5.1%

2005 2004Euro

millionChange

Current accounts & credit lines 6,475.0 6,308.9 166.1 2.6%

Mortgage loans 6,039.0 5,353.6 685.4 12.8%

Net NPLs 146.0 137.6 8.4 6.1%

Other loans 486.7 713.1 -226.4 -31.7%

TOTAL LOANS - Net 13,146.7 12,513.2 633.5 5.1%

2005 2004Euro

millionChange

Good increase in lending supported again this year by medium/long term loans

Stable overall quality

Rise in the total problem loans under IAS

Gross NPLs 313.0 320.1 -7.1 -2.2%Adjustments -167.0 -182.5 15.5 -8.5%

Net NPLs 146.0 137.6 8.4 6.1%

Cover ratio 53.4% 57.0%

Gross doubtful & restructured loans 243.0 260.4 -17.4 -6.7%Adjustments -35.0 -41.5 6.5 -15.7%

Net doubtful & restructured loans 208.0 218.9 -10.9 -5.0%

Cover ratio 14.4% 15.9%

NET TOTAL PROBLEM LOANS 354.0 356.5 -2.5 -0.7%

Gross loans expired > 180 days 87.0 --- --- ---Adjustments -5.0

Net loans expired > 180 days 82.0

NET TOTAL PROBLEM LOANS - IAS 436.0 356.5 79.5 22.3%

10

2005 2004 Change

Tier 1 capital 1,026.2 943.0 8.8%

Tier 2 capital 948.8 943.0 0.6%

Deductions -140 -76 84.2%

Regulatory Capital 1,835.0 1,810.0 1.4%

Risk-Weighted Assets 1,606.8 1487.6 8.0%

Tier 1 ratio 5.11% 5.07% 0.04 p.p.

Total capital ratio 9.29% 9.89% -0.60 p.p.

Capital Ratios

11

Capital Increase

Share nominal value (Euro)

Capital nominal value (Euro)

SHARE CAPITAL - Actual 1,137,127,468

Existing stock-options 158,701

SHARE CAPITAL (theoretical, after stock-options) 1,137,286,169 0.57 648,253,116.3

Amount of the share nominal value increase (from Euro 0.57 to Euro 0.60) 34,118,585.07

Free new shares (2x15) - Number 151,638,156 0.60 90,982,893.5

Amount of the free share capital increase 125,101,478.59

PAID-IN SHARE CAPITAL INCREASE 150,000,000.00

Paid-in increase - Issue price TERP - (0<discount<35%)

- simple arithmetic average official prices of the share oneach Stock Exchange trading day within 180 calendar daysprior to the day of the determination of the issue price

- the official price of the share announced on the day beforethe day of the determination of the issue price

TERP will be calculated on the basis of the lesser between:

12

Confronto 30/9 – 31/129M 2005 Var 9M 2005 PF 4Q 2005 FY

Margine d'interesse 382 -5 377 126 503

Commissioni nette e recuperi su c/c (*) 285 -22 263 64 327Dividendi e utili (perdite) delle partecipazioni 46 0 46 21 67Risultato delle attività e passività finanziarie 51 -2 49 -6 43Risultato netto della gestione assicurativa -19 22 3 2 5

Margine d'intermediazione lordo 745 -7 738 207 945

Rettifiche di valore nette su crediti e altre attività finanziarie -36 7 -29 -27 -56

Margine d'intermediazione netto 709 0 709 180 889

Spese di funzionamento: -489 0 -489 -137 -626- spese per il personale -280 0 -280 -109 -389- altre spese amministrative -170 0 -170 -57 -227- rettifiche di valore nette su attività materiali ed immateriali -39 0 -39 -16 -55- altri proventi di gestione netti (recuperi spese) 0 0 0 45 45

Risultato di gestione 220 0 220 43 263

Accantonamenti netti ai fondi per rischi ed oneri -14 0 -14 -3 -17Altri costi e ricavi dell'operatività corrente 0 0 0 17 17

Risultato operativo netto 206 0 206 57 263

Imposte sul reddito -71 0 -71 11 -60 Utile di pertinenza di terzi -14 0 -14 -18 -32

Utile netto 121 0 121 50 171

(*) Al 30 settembre 2005 la voce in questione includeva la somma tra le "Commissioni nette" (voce 60 del conto economico consolidato) e gli "Altri proventi di gestione" (voce 220 del conto economico consolidato)

BUSINESS PLAN 2006 – 2008

Milan - 31 March 2006

14

2003-2005 Results

Targets announced to the market have been attained:

– EPS: + 0.06 Euro more than targets

– Cost / Income: at 65%

Management of the evolution phase that accomplished:

– expansion of the Group’s perimeter and cost containment

– increased investment in consumer credit

– update of the distribution model to offer the various customer segments a more qualified service

– growth of total financial assets and productivity improvement

– optimisation of share capital allocation

– profitability performance improvement, value creation and increase in share price

Cost/Income

67.867.6

65.1

67.8

66.0

67.1

65.4

2002 2003 2004 2005

Target Actual

EPS

0.104

0.0850.088

0.110

0.076

0.0900.088

2002 2003 2004 2005

Target Actual

Data in Italian GAAP

15

Agenda

The new business plan target

Business plan actions

Expected results per business unit

16

Business Plan 2006-2008

2003-2005Commercial

segmentation2006-2008

Growth and efficiency

2003 2004 2005 2006 2007 2008

An increase in profitability, sustainable in time, made possible by an important rise in total financial assets and by a strong support to enhance specialised financial services which are accessory to the traditional banking activity (consumer credit, bankinsurance, pension schemes, leasing and factoring)

17

Business Plan 2006-2008

The Business Plan encompasses the company’s Vision and Mission

Vision

– A solid, competitive group strongly customer-oriented, tending towards value creation, sustainable in time, and incessantly growing in terms of organic momentum and innovation. All of which made possible thanks to the acknowledged wide network, the firm link with its business territories and the expansion towards the adjacent ones.

Mission

– Offering our customers professionalism, multiple solutions and distinct product excellence through the bank’s distribution and operations models which coherently meet customers’ own demands and feature competitive, risk-adequate pricing.

– A reference point for the local economy’s growth.

– Integrity, transparency and social responsibility accomplished by a sound and prudent business management.

18

Guidelines 2006-2008

Commercial network expansion

Customer base widening

Increase in our lending market share

Keeping our funding market share

Cost/Income ratio reduction

Value creation

Multi-channel approach

Growth

Quality of customer relation

Cost control

19

2008 Targets

2005 2008

Net Income (€ mln) 171 210

ROE 14.5% 15.3%

ROE pre-tax 22.3% 27.7%

Cost/Income ratio 66.3% 60.0%

EVA (€ mln) 85 117

EPS (€) 0.150 0.155

Tier 1 ratio 5.1% 6.0%

Total Capital ratio 9.3% 9.0%

Net NPL ratio 1.39% 1.33%

I valori differiscono da quelli esposti in bilancio perchè includono BCRF Romania

20

2008 Targets

Euro 71 million net income growth in 2008

– 6.8% total income growth (CAGR)

– Strong cost containment

– Cost/Income ratio from 65% to 60%

– Credit quality upkeeping

One-off tax benefit in 2005

– Euro 32 million tax exemption on appreciation of real estate

71

15

213

171

68

59

139

210

2005 Net

income

Total

income

Total

costs

Adjs. Taxes and

other

2008 Net

income

21

Economic Outlook

Italy (%) 2005 2006 2007 2008

GDP 0.1 1.0 1.4 1.3

Household exp. 0.9 0.9 1.8 1.4

Domestic demand 0.6 1.2 1.7 1.5

Corporate investments 2.1- 2.2 1.8 2.3

Export 0.3 4.0 3.1 3.5

Price index 2.0 2.2 1.8 2.3

Territorio

Lending 5.3

Direct Funding 3.9

Indirect Funding 3.6

Customer Spread -

CAGR 2005-2008

Source: Prometeia Forward-looking Report - Dec. 2005

Source: IRPET Regional Forecasts - Jan. 2006

Euribor

2.40

3.25

3.003.00

2005 2006 2007 2008

GDP (%) 2005 2006 2007 2008

Tuscany 0,1- 1,4 1,3 1,4

Umbria 0,7 0,8 1,6 1,4

Latium 0,4 1,0 1,3 1,2

Emilia R. 0,1 1,4 1,7 1,5

Liguria 0,1 1,0 1,4 1,3

22

Focus Points

Under the apparently calm surface (given by fundamentally solid statements produced in spite of the unfavourable business environment), strong currents do exist and these can influence the future stability of the sector and of the main operators:

– small enterprises’ rising debts;

– competition from non-banking players in funding and in liquid cash management;

– cost-conscious families reducing the number of current banking accounts;

– smaller margins from family mortgages, business loans and consumer credit and higher, potential credit risks;

– organisation and cultural difficulties in supporting the enterprises’ transformation and development plans;

– difficulties in switching from a sales-oriented approach to a more active and flexible management approach which caters to customers’ needs and expectations.

Source: Prometeia – June 2005

23

Findomestic Banca – Development Framework

Targets:

– Keeping the current market penetration share in total loans to families

– Maintaining the market share in total production by controlling profitability and the risk cost (*Assofin market statistics*)

– Maintaining the leadership of Findomestic, in terms of market share, and defending our competitive advantage (Assofin market statistics*)

Strategy:

– Supporting the distribution network and developing new markets to ensure the necessary customer base growth. To be present wherever the major transactions take place

– Increasing the speed of growth of personal loans

– Improving productivity while maintaining a constant quality levels through a review of the procedures and of the cost structure with an eye on competitiveness

(*) steady market composition

24

Findomestic Banca – Development Framework

Commercial Network

– Re-engineering the activities of the commercial staff to improve relations with retailers and to increase the sales point penetration share.

• Vehicles – Widening the product (Renting) and services range adding ancillary service packages

• Black goods and Furniture – This is the most important client source but also the major source of costs.. Findomestic will regain its penetration share in smaller sales points and will increase its revolving card penetration

Banks and Insurance Companies

– New agreements for the management of personal loans and cards on behalf of banks/ insurance companies

New Markets and New Channels

– Growth opportunities for consumer credit in travel and medical services, utilities, clothes and food shops

– Salary-guaranteed loans under development

– Strong development of sales on the internet

Trademarks and advertising

– Enhancing Findomestic Banca brand image. Target: 80%, just like Aura card

25

Agenda

The new three-year business plan target

Business plan actions– Growth through internal progress

– Service and customer relations quality

– Cost control

– Multi-channel instruments


26

Basic GrowthCustomer Deposits (average amounts)

14.901 14.901

320 320

1.686601

417

668

2005 2006 2007 2008 2008 E

Indirect Deposits (average amounts)

17.198 17.198

2.158658

833

667

2005 2006 2007 2008 2008 E

Customer Loans (average amounts)

12.580 12.580

1.967679

541

747

2005 2006 2007 2008 2008 E

CAGR=4.3%

CAGR=4.0%

CAGR=5.0%

EMTN

The average figures differ from those stated in the annual report because the current ones include Banca C.R. Firenze Romania and exclude credit to Centro Leasing who in the process of becoming a bank.

RWA (Findomestic included)

19.975 19.975

3.910771

1.473

1.666

2005 2006 2007 2008 2008 E

CAGR=6.1%

27

Basic Growth

Steady income growth amounting to Euro 34 million (the target was Euro 71 mill.)

– The growth of total income (Cagr = 4.4%) includes Euro 104 million deriving from the interest margin (Euro 80 million due to volumes and Euro 24 million due to rates)

– Operating expenses grow a little more than inflation (Cagr=2.8%)

34

4138

171

54

46

139

173

2005 Net

income

Total

income

Total

costs

Adjs. Taxes and

other

2008 Net

income

28

Growth – New Openings

Financing growth means responding to human resources needs of about 300 people and to total investments for about Euro 16 million.

Impacts on income consider a break-even within 3 years, therefore real effects will be registered in the years following 2008.

New Branches

-5.8

-24.2

17.8

Total income Total costs Contribution to

the net income

New Corporate

Centers

0.0

-8.4

10.7


the net income

New Private Centers

-1.7-3.2

0.7


the net income

29

Growth – Retail Branches

Streamlining today’s networks

– Definition of operational areas for each single bank

– Branch brand change where needed

– Transfer of about 11 branches (for example, from cities with a population under 25,000)

Planned openings

– Openings, mainly in areas with the greatest attraction and synergy with the financial advisors’ network to maximise commercial efficiency

Specialised branches

– Creation of 4 new sales centres specialised in mortgage loans

Growth = 43 more branches

Territorial attraction+ -

30

Growth - New Corporate & Private Centres

Corporate Centres

– Opening 13 new Corporate Centres, mainly for the banks controlled by BCRF, in line with the geographical expansion of our branches (Milan, Rome, Emilia Romagna, Mantua and Verona)

– Strengthening our Corporate Financing unit

Private Centres

– Opening 10 Private Centres, mainly for the banks controlled by BCRF, where there are interesting market opportunities

Growth = 23 more centres

Territorial attraction+ -

31

Bucarest

Timisoara

PitestiConstanza

Crajova

Satu Mare

RimnicuVilcea

Galati

Bacau

Brasov

Baia Mare

ClujNapoca

Oradea PietraNeamt

Iasi

Sibiu

Slatina

TirguMures

Current branches

Future branch openings in 2006-2008

Growth = 21 more

branches

Growth – International Endeavours

Banca C.R. Firenze Romania SA

– The network currently consists of 9 branches (out of which 6 in Bucharest).

Expansion

– Strengthening the position in the area thanks to 30 branches

– Expanding the retail customer base in Bucharest and in the main cities

– Supporting Italian-Romanian enterprises

– Hiring roughly 160 people

Target

– Steadfast growth,

profitability and

synergies with the group

BCRF Romania

2.9

-4.4

8.6


the net income

32

Agenda




– Cost control



33

Customer Relations

Improving the retention rate, share of wallet and cross-selling by:

– Implementing the same distribution, organisation and operational models in all the banks of the group

Target

– Cross selling

• Individuals from 3.8 to 3.95

• Small Business from 4.82 to 4.97

– Retention rate

• Individuals from 93.4% to 94.0%

• Small Business from 92%.4 to 93.0%

– Multi-channel banking from 27.6% a 27.0%

Better Client Relationship

7.4

-6.2

17.9

1.7


the net income

34

Quality of customer relation

Keener client relationships

– A customer-satisfaction monitoring

– Business Intelligence (Retail clients)

• Expanding CRM to improve the reporting quantity and quality in order to offer the branches an instrument to optimise customer relations and contact opportunities and commercial proposals

• Extending CRM to the other banks of the group

Review of the “credit process”

– Seizing the commercial opportunities for growth offered by Basel II through:

• pricing correlated to risk

• risk mitigation

• allocation efficiency

Service improvement

– Enhance our communication process by:

• revision of all customer communication tools

• definition of a document/ channel/ timing model

• Tailoring of communications to each segment or customer profile

• reduction of management costs

– A new pricing model:

• shift from a product pricing to a relation-based pricing

– Strengthening the trust relationship:

• helping customers in decision-making about financial investments, pension schemes, insurance or borrowing

35

Quality of customer relation - Widening our offer

Focusing on just a few action lines:

Mortgages and Personal Loans

Pension Schemes

Insurance

New offer

2.5

-3.6

7.8


the net income

36

Mortgages and Personal Loans

Current status:– The market share of lending to privates is lower than the market share of funding;

– The use of indirect channels for the sales of mortgages is lower than the Assofin reference;

– The penetration percentage of personal loans and revolving cards released by the group banks is lower than that of the banking system

Actions:– Mortgages

• Opening new mortgage counters (Spazio Mutui) in the principal cities: - to act as reference points for all indirect channels (real estate agencies, credit brokers, internet customers)

- to be portfolio holders for those clients who request the specialised service in the main cities

• Developing a data-processing platform– to integrate the brokers into the order gathering process and into the Spazio Mutui for portfolio management

– Personal Loans and Aura revolving cards

• Development through the implementation of joint-marketing agreements with Findomestic for the launch of continuous sales campaigns directed at the group’s customers,

• Implementation of CartaSì revolving cards (revolving credit supplied upon request) specifically for the richest customers.

37

Pension Schemes

Current status

– At the end of 2005, the pension fund CRF Previdenza managed a portfolio of Euro 35.7 million (+150% on an annual basis)

– The pension reform is expected to be effective from 2008 (collective schemes will be liberalised)

– It is necessary to focus commercial action on

• individual underwriting

• on those worker categories that do not have their own specific close-end pension scheme

Actions

– 2006 and 2007

• Focus on sales; every sales point endowed with one expert who can generate an increase in the number of sales contracts, from an average of four contracts per year to 24 contracts per year (two per month).

• Collective schemes underwriting aimed at our corporate customers who operate in sectors not yet covered by close-end schemes: 2,000 companies in the transportation field

– 2008

• Increase the group of specialists to 30 employees with skills in the collective schemes underwriting aimed at our corporate customers of all fields of business. Beginning: in the second-half 2007 for sales closing by January 2008

38

Insurance

Current status

– Customers demand products which the bank does not yet offer

Actions

– Expansion of the “Insurance Protection” business area

• Centrovita is to develop certain types of insurance products

• Products to be sold through the group’s bank network

– Products

• Protezione Salute: health insurance coverage against surgery risk for all family members

• Protezione Domani: life insurance benefits for all causes of death (simplified sales terms with less bureaucracy)

• Mortgage Loan: insurance coverage in case of death or loss of work

• Damages Insurance: in the course of the next three years, BCRF will study the possibility of extending the insurance product range to cover damages

39

Quality of customer relation - Acquisition of Customers

Analysis of the acquisition ratio:

– 2004

• Individuals a 2.4 point negative gap in comparison to the average ABI sample

• Small Business - a 4.8 point negative gap in comparison to the average ABI sample

– 2005

• ratios improved both for BCRF and for the whole group

Actions

– Close follow-up and implementation of agreements with enterprises, public entities, associations & trade unions on customer acquisition and development

– Intense use of direct marketing tools

– Attractive and tailored offers

– Synergies between distribution channels

New Customers

5.0

-2.6

11.0


the net income

Net growth = 15,000 more clients

40

Quality of customer relation - Managing Key Corporate Accs

Increase in our corporate market share– exploiting the opportunities offered by Basel II

– improving market positioning of M/L term loans

Identifying and managing “Key Corporate Accounts”

– increasing credit lines for best-rated classes

– decreasing credit lines for worst-rated classes

– improving the mix between profitability and cost of risk

Share of Wallet granted by BCRF per rating class

Target share

Current share

Real share in 2008

0,0%

10,0%

20,0%

30,0%

40,0%

50,0%

60,0%

70,0%

80,0%

A1 A2 A3 A4 B1 B2 B3 B4 B5 B6 B7 B8 C1 C2

K ey Clients

5.5

-0.1

8.1


the net income

41

Customer Loans (average amounts)

12.580 12.580

541

679

747

1.967

871

528

775

2.174

2005 2006 2007 2008 2008 E

Indirect Deposits (average amounts)

17.198 17.198

833

658

667

2158

392

325

356

1.073

2005 2006 2007 2008 2008 E

Total growthCustomer Deposits (average amounts)

14.901 14.901

320

250

500

1.070417

601

668

1.686

361

42

179

582

2005 2006 2007 2008 2008 E

CAGR=7.0%

CAGR=5.9%

CAGR=9.9%

EMTN

RWA (Findomestic included)

19.975 19.975

1.473

771

1.666

3.910

2.083

611

669

803

2005 2006 2007 2008 2008 E

CAGR=9.1%

Basic growthAdditional growth

42

Agenda




– Cost control


Expected results per business segment

43

ICT Optimisation

Implementation of the group’s new ICT configuration

– Governance model

– Structure and operating optimisation

– Sourcing flexibility

– Reduction of processing costs

Group data-processing system

– Revision of the application portfolio

– Unification of the services & operative applications

• Account identification

• Branch

• Customer Reports

• Reporting

• Risk

• CRM

ICT - Effi ciency

0.9

1.4


the net income

44

Disposal of the Tax Collection Business

Premessa

– Legislative Decree n°203 of 30 September 2005:

• From 1 October 2006 the national system which established that tax collection services were to be operated on a licence basis shall be abolished;

Actions after 30 September 2006

– CERIT

• The company shall be transferred to other shareholders.

– SRT

• The majority of the capital shares shall be transferred (excluding activities pertaining to local taxes)

45

Disposal of the Tax Collection Business

Human Resources

9

210 201

Actual Savings New Co

P & L impact

0.6

26.5

-30.9


the net income

46

Group Integration

Objectives

– Strengthening the governance through the unequivocal definition of duties and responsibilities of the Parent Company and of the banks controlled by it, with particular reference to the elements of the governance, production and distribution

– Improving efficiency by simplifying the processes and by maximising from the synergies present inside the group. Actions will be undertaken in the current pockets of efficiency recovering, especially with regards to staff population in the head offices and in the distribution network

Actions

– Merger of CR Mirandola

– Integration of CR Orvieto, CR Spezia, CR Pistoia

– Evolution of the organisation model of the distribution network (branches < 8 employees) and a portfolio review

– Perfect management of the staff turnover

47

Organisation Model

CRFCRFCRFCRF

CRCCRCCRCCRCCROCROCROCROCRPCRPCRPCRP CRSCRSCRSCRS

CENTRALIZED

SERVICES

70,5%

78.7% 81.0% 76.1%

3,608 employees

614 employees 178 employees 206 employees 515 employees

Current

Target 70,2%

86.0% 86.3% 88.5%

84.5%

90.0%

Current

Target

48

Group Integration

HR - Effi ciency

8.98.9

5.2


the net income

Turn-over

Saving

Turn-over management

233

400

167

Turn-over Savings New Hired

49

Human Resources

Human Resources

6,097

163

3811

28324

5,901

201

167

2005 Tax collection New branches Savings New products &services

IT services Wealthmanagement

Romania 2008

5,700

5,934

50

Agenda




– Cost control



51


Statistics referring to clients using multi-channel instruments show profitability, retention and satisfaction average degree that is higher than that of the group’s total individual current account holders

Potential synergies with Findomestic customers

Strategy

1. Client-centred

The business location (branches, corporate/private centres, financial advisors & mortgage counters) govern customer relationships and have an overall vision of his operations. For the multi-channel client, the virtual channel remains the most used contact method.

2. Integration between channels

4. Focus on core business

All actions are primarily oriented towards customer service improvement and, consequently, bring to a cost-to-serve cut. Business information of interest for the client, distributed through all channels, increase contact opportunities. Clients thus perceive a higher-quality relationship.

At every stage of the contact, the bank focuses its attention on the client, regardless of the channel used. The client acquires a “customer experience” which is similar for all the different channels used.

3. Customer Service

The information available on all channels will focus on the bank’s business (finance, banking, insurance and pension plans).

Multichannel

1.2

-5.3

7.2


the net income

52


• Remains the client’s preferred channel

• Gradually diminishing in terms of transaction importance

• More integrated into other channels and capable of exploiting spontaneous requests

• Pivotal for the implementation of customer education programs

• Its service/support role to other remote channels is rising (assistance & backup)

• Synergetic for the branches’ commercial campaigns (outbound & inbound for business exploitation)

• Branches’ principal complementary channel for the low value-added operations

• Increasingly more effective for messaging offers and information to customers and for stimulating visits to branches

• Best instrument for information on clients useful to marketing

• Cross selling and co-marketing actions are made easier

• Highest penetration potential channel (greatest freedom & easy to use)

• Improves clients’ service level perception (alerts/triggering)

• Enables efficient contact with the young customer segment

• Micro-payments

• For customers who do not use computers, teller machines can potentially integrate most internet operations

• Suitable for low-value transactions involving document handling/reading

• Marketing support for commercial messaging (even personalised)

Branch Call Center Internet Mobile Banking ATM

CRM

Fully integrated into CRM To be integrated into CRM

CRM will be the joint between all bank channels. Each channel will have its own defined role.

53

Agenda




– Cost control



54

Results - Details per Banks

13

53

171

6

1.5 1.5 2.9 7

139

71

2005 Net

income

CRF CRP CRS CRO CRC CRF

Romania

Other &

Adj.

2008 Net

income

55

Expected Results per Business Segment

EVA

42

15 19

99

32

6

83

1624

7 824

Retail P rivate & Corporate Wealth Management Finance

2004 2005 2008

Recap:

Continuing efficient growth and increased value creation for our

customers, shareholders and employees

2 0 0 5 g r o u p r e s u l t s

Documents

ppgross total income

g r o u p r e s u

annualized average ratesavg

group net income

total problem loans

total capital ratio

total financial assets

consolidation method