Republic of Belarus: General Information

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1 September 2017

2 Contents Republic of Belarus: General Information 3 Belagroprombank: General Information Belagroprombank: Financial Indicators. 14 Belagroprombank: International Business. 19 Contacts

3 Republic of Belarus: General Information

Republic of Belarus: overview Population 9.5 mln Foreign trade turnover, 01.08.2017 USD 34.2 bn Inflation, 01.08.2017 3.3% Gold & Currency reserves, 01.08.2017 USD 6.7 bn External public debt, 01.08.2017 Credit ratings: S&P Fitch Ratings Moody s USD 15.

4 Republic of Belarus: overview Population 9.5 mln Foreign trade turnover, USD 34.2 bn Inflation, % Gold & Currency reserves, USD 6.7 bn External public debt, Credit ratings: S&P Fitch Ratings Moody s USD 15.6 bn B-/stab. B-/posit. Caa1/stab. Manufacturing 24.9% Transport & Communications 5.7% Construction 6.3% Net taxes on products 13.7% 2016 GDP Structure USD 47.4 bn Agriculture, Hunting, Forestry & Fishing 6.8% Other 31.8% Wholesale & Retail Trade 10.8% Belarus has an open export oriented economy Natural resources: potash, rock salt, timber, oil & natural gas, granite, peat, dolomitic limestone, chalk, slate stone Refinancing rate since % p.a. On national currency was redenominated at a rate of BYR : BYN 1 4 Sources: National Bank of Belarus, National Statistical Committee of Belarus

5 Belagroprombank: General Information

Belagroprombank s Overview Universal commercial bank State holds the major share in the bank's ownership structure Government Agent on servicing State Programs Leading positions in banking sector of

6 Belagroprombank s Overview Universal commercial bank State holds the major share in the bank's ownership structure Government Agent on servicing State Programs Leading positions in banking sector of Belarus: #2 by authorized fund and equity #2 by total assets and customer deposits Second largest network: 5 local branches and 259 outlets * About corporate and 1.7 mln retail clients Credit rating: S&P В-, Stable (at sovereign level) In 2017 Belagroprombank s authorized fund was increased by BYN mln (USD 230 mln in equivalent). Key financials Q BYN mln Q USD mln Assets Share capital Loans to customers Customer accounts Profit 5 3 Tier 1 capital adequacy ratio, % 13.6 Data for 3m 2017 (non audited IFRS figures) The only bank in Belarus with in-depth knowledge of agriculture - the core export-oriented sector of Belarus economy 6 * As of

7 History and Development Belagroprombank was created on the basis of Belarussian branch of Agrobank of USSR 1992 the Bank obtained general license to perform banking activities in foreign currency 1994 the Bank became a member of SWIFT international settlement system 1996 the Bank obtained the status of the Government Agent on serving state programs Belagroprombank joined Reuters system JSC Belagroprombank was awarded with the title The Bank of the Year 2002 by The Banker magazine 2004 the Bank s financial statements were prepared in accordance with IFRS and audited by Deloitte and Touche Long-term rating of the Bank was assigned at CCC+ by Fitch Ratings 2005 the Bank joined Visa International payment system 2006 Fitch Ratings upgraded the Bank s rating to B- The Bank tapped international debt capital markets, the total volume of borrowings reached USD 340 mln 2007 Global Finance named JSC Belagroprombank The Best Bank in Belarus The Bank has opened its representative office in Milan, Italy Euromoney magazine awarded the Bank with Award for Excellence The Bank became a member of CICA (International Association of Agricultural Credit) 2008 Moody s assigned rating for the Bank for the first time For the second time Global Finance named JSC Belagroprombank The Best Bank in Belarus 2009 The Bank held conference on agroecotourism development in Belarus 2010 Belagroprombank was the first among Belarusian banks to issue 3 year USD 100 mln CLN The Bank became the member of MasterCard Worldwide Belagroprombank was the first among Belarusian banks to implement quality management system ISO , The Bank was awarded twice with EUR STP Excellence Award by Deutsche Bank for the exceptional quality of payments 2012, 2013 The Bank was honored by Commerzbank with STP Award 2011 and STP Award 2012 for achieving the highest quality of payments 2014 The Bank became the participant of the Moscow Exchange trading The quality management certificate against ISO 9001:2008 is confirmed by TÜV Thüringen certification authority 2015 The Bank was accepted as a full member of Polish-Belarusian Chamber of Commerce The Bank was named Best Bank in Belarus 2015 by international business magazine bne IntelliNews Belagroprombank was the first among Belarusian banks to raise the Syndicated Loan nominated in three currencies 7

8 Belagroprombank s market positions Equity Corporate Loan Portfolio 19% 15% Assets Retail Deposits 16% 17% 8 Source: National Bank of the Republic of Belarus Data as of

9 Governance Structure General Shareholders Meeting Supervisory Board Supervisory Board is headed by the Deputy Prime Minister of the Republic of Belarus In accordance with the best international practices, independent directors are members of the Supervisory Board Risk Committee Management Board Audit Committee Corporate Governance Committee Credit Committee Finance Committee Asset-Liability Management Committee Bad Loans Committee IT Committee 9

Belagroprombank s Group and its Branch Network

2017 5 Local Branches 259 Outlets Belagroprombank s

which consists of the following enterprises consolidated

70% JSC Ozeritskiy-Agro (agriculture) 92.

10 Belagroprombank s Group and its Branch Network Belagroprombank s Branch Network as of Local Branches 259 Outlets Belagroprombank s subsidiaries The Bank is a parent company of a Group which consists of the following enterprises consolidated in the financial statements 99.70% JSC Ozeritskiy-Agro (agriculture) 92.33% JSC Agroleasing (finance leases) 100% UE Agrobusinessconsult (consulting) 94.98% JSC Turovschina (agriculture) 10 Headquartered in Minsk Implementation of regional network transformation strategy Representative office in Milan, Italy

11 Belagroprombank s Development Strategy Strategic goal to ensure balanced, secured and efficient functioning Corporate business Improving the efficiency of full service system Reducing the share of loans under governmental programs Focus on new customer segments (SMEs, retailers) Retail business Maintaining the leading positions in retail deposits attraction Increasing the share of retail lending Introducing the new products and services, expansion of the sales channels International Cooperation Improving the key elements of the bank s management systems Extension of the instruments for foreign funding raising Search for new partners, establishing cooperation with financial institutions from new regions Implementation of a wide range of documentary business products Rendering services for banks in documentary and international business Transformation of branch network Development of the internal control system Risk management strategy Development of IT Development of human resource management 11

12 Risk-Management Bank's risk management system is aimed at providing financial reliability, stable and secure functioning while achieving common strategic objectives of the Bank Risks Bank's risk management structure is headed by the General Meeting of Shareholders, the Supervisory Board and the Risk Committee of the Supervisory Board. Bank generates reports on consolidated basis for: activity effectiveness monitoring; risks (safe functioning standards) level monitoring; ensuring information transparency (informing the National Bank of the Republic of Belarus, contractors and other stakeholders). Strategic Operational Credit Pricing Currency Liquidity Interest Constant risk monitoring by: Structural divisions Banking risks division Internal audit division, External audit Responsible for the risks generated by them in the normal course of business Carry out independent risk management functions Conducts an independent audit of the risk management system functioning Reputation 12

13 Business Overview Corporate banking Retail banking International operations About clients The clients are the large and medium-sized manufacturing companies and entities in the agricultural sector Total corporate loan portfolio of about USD 2.5 bn (in equivalent) State lending programs for the agricultural sector Wide range of services includes: Lending, leasing, factoring operations Credit support of trade operations Advisory services Providing credit support to the subjects of agroecotourism About 1.7 mln clients Area of strategic importance and development for the Bank Total retail loan portfolio of more than USD 128 mln (in equivalent) Product offering includes: Multi-currency deposits Money transfers Foreign currency exchange Payment cards (BelCart, Visa, Maestro, MasterCard) Payments services SMS-banking Internet-banking Consumer lending, car lending, mortgages Selling of gold, platinum and silver bullions One of the leaders in trade- and ECA backed finance in Belarus More than USD 7.4 bn raised since 2005 by means of trade finance, ECA-covered financing, DCM transactions etc. More than USD 1 bn raised since 2006 by means of syndicated loans and issuing of credit notes, etc. Cooperation with more than 100 financial institutions from 30 countries Recognition by 18 ECAs (SACE, Hermes, KUKE, Coface, OeKB and others) Representative office in Milan, Italy 13 Data for 3m 2017 (non audited IFRS figures)

14 Belagroprombank: Financial Indicators

Аssets Total assets Assets structure, % 5,5 4,6 6,6 5,7 7,9 7,5 7,8 6,6 9,0 9,0 8,5 4,8 4,6 4,6 Loans to customers (57%) Investment in securities (31%) 57% Cash and balances with the National Bank of

15 Аssets Total assets Assets structure, % 5,5 4,6 6,6 5,7 7,9 7,5 7,8 6,6 9,0 9,0 8,5 4,8 4,6 4,6 Loans to customers (57%) Investment in securities (31%) 57% Cash and balances with the National Bank of the Republic of Belarus (5%) Q Property, equipment and intangible assets (5%) 2% 5% 5% 31% BYN bn. USD bn. (in eqv.) Other assets (2%) Major part of assets formed by loans to clients (mostly to corporates) Investments in securities form over 30% of the total Bank s assets 15 Data for 3m 2017 (non audited IFRS figures)

16 Loan Portfolio Breakdown Agriculture 33% Other 3% Construction 1% Sector breakdown Manufacturing 45% Trade 12% Individuals 4% Government bodies 2% Bank has a high-quality and diversified loan portfolio Agriculture s portion in the total loan portfolio is decreasing and amounts to less than 35%. Agriculture itself includes both primary agricultural production of all types and its further processing The Bank follows a conservative credit policy. The level of past due loans is 1.42% of the total loan portfolio* The ratio of provisions against losses to the total loan portfolio is 8.93% Credit policy principles Assessment of the credit ratings to the clients (priority is given to the clients with "A+", "A-", "B+", "B- ratings from 8 possible) Establishment of limits on the clients (depending on the amount of the limit, respective decision taken at various levels of governance) Constant monitoring of credit risks 100% of the loan portfolio is secured Property & inventory 34% Other 9% Loans structure by collateral Guarantees of the government & local authorities 14% Real estate 22% Lien over property & receivables 21% 16 Data for 3m 2017 (non audited IFRS figures) *NAS figures

17 Capital and Sources of Funding Share capital BYN bn. USD bn. (in eqv.) 2,9 3,0 2,9 2,9 2,9 2,9 2,3 2,4 2,1 1,6 1,5 1,5 1,5 1,5 Due to banks & the National Bank 13% Debt securities issued 11% Structure of liabilities, % Customer accounts 72% Other 4% Q The capital/assets ratio provides significant capability to cover unforeseen loan losses in addition to existing reserves Capital adequacy ratio of Belagroprombank conforms to Basel standards and meets all requirements of the National Bank of the Republic of Belarus In 2017 Belagroprombank s authorized fund was increased by BYN mln (USD 230 mln in equivalent). 30,0 20,0 10,0 0,0 Tier 1 Capital adequacy ratio, % 25,8 22,7 23,4 22,1 17,4 13,2 13, Q According to the standards set by Basel Accords capital adequacy ratio must be at least 8% 17 Data for 3m 2017 (non audited IFRS figures)

18 Income and Expenses Interest Income and Expenses Dynamics, BYN bn Operating Income and Expenses Dynamics, BYN bn ,2 1,3 1,3 1,3 1,1 0,9 0,9 1,0 1,1 0,8 0,9 0,6 0,3 0, Q Interest income Interest expenses Net interest income 0 0,5 0,5 0,4 0,4 0,3 0,3 0,3 0,3 0,3 0,3 0,2 0,1 0,1 0, Q Operating income Operating expenses Profit before tax Other non - interest income 36% Operating Income Breakdown BYN 0.1 bn Net interest income 30% Net fee & commission income 34% Other 26% Operating Expenses Breakdown Contributions to deposits protection fund 5% Utilities, rentals & maintenance 6% Depreciation and amortization 11% BYN 0.1 bn Payment information transmission and processing, software maintenance 5% Personnel 37% Social security contributions 10% 18 Data for 3m 2017 (non audited IFRS figures)

19 Belagroprombank: International Business

20 Belagroprombank s position in the world According to magazine The Banker JSC Belagroprombank Ranking by Equity (July 2016) 787 Top 1000 World Banks 18 among 25 largest banks of Central and Eastern Europe Top 25: Central & Eastern Europe 2 among Belarusian banks Country Ranking 20

21 International Business International markets activities Belagroprombank has been accepted by 18 ECAs for participation in co-financing of applicable transactions Belagroprombank cooperates with more than 100 banks from 30 countries of the world Bank provides all available instruments for project financing, precisely tailored to fit the individual requirements of each client Our achievements: Bank became Belarusian financial market pioneer in countries such as Italy and Hungary, concluding debut deals for Belarus. Belagroprombank was the first among Belarusian banks to sign a loan agreement with a non-bank financial institution resided in the United States - Deere Credit, Inc. Bank implemented a unique deal for the Republic of Belarus denominated in Japanese yen. Bank implemented a significant deal raising a loan under the cover of Euler Hermes totaling EUR 100 million for 10-year term without the guarantee of the Government of the Republic of Belarus. Insurance cover was provided outside the country limit for Belarus and significantly exceeded it. Bank carried out raising credit facility with Israel s ASHR A insurance cover for a 7-year term. 21

22 International Funding Track Record. Syndicated Loans EUR 30 mln 1 year + 1 JSC VTB Bank & VTB Bank Europe plc August 2006 EUR 30 mln 1 year JSC VTB Bank & VTB Bank Europe plc August 2007 RUB 1 bn 1 year JSC VTB Bank June 2007 USD 40 mln 1 year + 1 Commerzbank AG Banco Finantia SA UniCredit Group February 2008 USD 55 mln 1 year + 1 Banco Finantia SA Credit Suisse Intesa SanPaolo September 2008 USD 43.5 mln 1 year Club style November 2009 First syndicated loan for Belarus state-owned bank raised for the term of 1 year Extension of the loan with the original amount and decreased margin Deal of the Year according to Trade&Forfaiting Review Magazine For the first time in Belarus UniCredit Group acted in capacity of MLA Intesa Sanpaolo SpA for the first time in Belarus acted in capacity of MLA The only deal closed in Belarus banking sector in USD 63.5 mln 1 year + 1 JSC VTB Bank OJSC ALFA-BANK VTB Bank (Deutschland) AG October 2013 USD 70 mln EUR 29 mln 1 year JSC VTB Bank VTB Bank (Deutschland) AG October 2014 EUR 75 mln USD 4 mln RUB 7 bn 6 months + 6/1 year AO ALFA-BANK TRANSKAPITALBANK Promsvyazbank PJSC March 2016 EUR 22 mln 6 months + 6 AKA Ausfuhrkredit- Gesellschaft mbh May 2016 EUR 190 mln 1 year +1/1.5 year PJSC Bank Otkritie Financial Corporation TRANSKAPITALBANK Broad geography of the deal: Russia and Europe Extension of the loan with the increase of the original amount and accession of new European banks The first syndicated loan in Belarus nominated in three currencies The first European syndicated loan in Belarus since 2008 April 2017 First syndicated loan for Belarus raised for the term of 1.5 year

23 International Funding Track Record. Notes issue EUR 70 mln 1 year MLA VTB Bank Europe plc & Banco Finantia SA USD 100 mln 3 years MLA Investment Company Troika Dialog & The Royal Bank of Scotland plc December 2006 November 2010 In December 2006 Belagroprombank was the first Belarusian bank to raise funds via notes issuance One-year notes were successfully placed among investors mostly based in UK and Western Europe representing emerging markets funds as well as private banks In November 2010 Belagroprombank completed placement of its USD 100 mln three-year issue priced at par with a coupon of 9.95% p.a. and listed on the Frankfurt Stock Exchange Belagroprombank is the only bank in Belarus to price internationally distributed notes 23

24 Awards and Successes Deal of the year 2007 Syndicated Loan RUB 1 bn Bank of the Year 2002 in Belarus Award for Excellence 2007 Best Bank in Belarus 2007 STP Award 2011, 2012 Cbonds Awards 2013 Deal of the year 2007 Best Bank in Belarus 2008 For exceptional quality of payment messages, 2009, 2010 Deal of the Year in 2009 Brand of the year 2009 Best Bank in Belarus 2015 Best trade & Structured Finance bank in Belarus

25 Contacts Mr. Siarhei P. CHUHAI Deputy Chairman of the Board Tel.: Mob.: Fax: s.chuhai@belapb.by Ms. Natallia P. SVIRSKAYA Head of International Business Department Tel.: Fax: n.svirskaya@belapb.by Mr. Pavel P. RYNKOV Deputy Head of International Business Department Head of Financial Institutions Tel.: Fax: p.rynkov@belapb.by 25

Republic of Belarus: General Information

October 2018 Contents Republic of Belarus: General Information 3 Belagroprombank: General Information...... 5 Belagroprombank: Financial Indicators. 14 Belagroprombank: International Business. 19 Contacts...........