Capital Core Tier 1 capital ratio 13,6% 12,0% > 15% Leverage ratio (Assets/Equity) 11,3 x 13,6 x < 10x

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1 KEY PERFORMANCE INDICATORS AND OVERVIEW OF PROGRESS IN THE IMPLEMENTATION OF THE RESTRUCTURING PLAN OF THE COOPERATIVE CREDIT SECTOR FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2015 A. Key Performance Indicators Following a consultation with the Central Bank of Cyprus, the following Key Performance Indicators (KPIs) have been selected for the Cooperative Credit Sector (CCS), including mid-term targets, which represent the priorities of the CCS. These indicators are published on a quarterly basis, enabling the public to evaluate the progress of the Restructuring Plan and the financial performance of the CCS. The following table presents the aforementioned Indicators, the mid-term targets for each Indicator (as set for 31 December 2017) and the latest data for each Indicator. Medium-Term Cooperative Credit Sector Key Performance Indicators Target Asset Quality Provisions to 90+ Days Past Due loans 44,3% 49,9% > 45% Provisioning charge (Cost of Risk) 1,3% 3,8% < 2% 90+ Days Past Due mln Days Past Due, excluding interest as of ( mln) < Funding Loans to Deposits ratio (Net Loans to Deposits) 81,6% 74,3% < 85% Capital Core Tier 1 capital ratio 13,6% 12,0% > 15% Leverage ratio (Assets/Equity) 11,3 x 13,6 x < 10x Efficiency Cost-to-Income ratio 37,4% 41,2% < 42% Net Interest Margin 2,7% 2,5% > 2,5% Number of branches Cooperative Credit Sector ** Cooperative Sector employees ** Until 31 st December 2015 B. Comments on the evolution of the Key Performance Indicators Asset quality As at 30 September 2015, the accumulated provisions to 90+ days past due loans ratio increased significantly to 49,9% due to a higher provisioning charge during the 3 rd quarter of 2015 (5,6 percentage points increase compared to 31 December 2014). The provisioning charge for the nine months ended 30 September 2015 has increased to 3,8%, compared to an annual provisioning charge of 1,3% for the year ended 31 December A positive development during the nine months ended 30 September 2015 constitutes the decrease in 90+ days past due loans, excluding interest.

2 Funding The net loans to deposits ratio has decreased to 74,3% as at 30 September 2015 compared to 81,6% as at 31 December 2014, mainly as a result of the increase in deposits and the reduction in loans and other advances to customers. Capital Core Tier I Capital ratio for the period ended 30 September 2015 amounted to 12,0%, compared to 13,6% as at 31 December The reduction of the ratio is the result of the higher provisions and the net loss for the period ended 30 September The Leverage ratio for the nine months ended 30 September 2015 increased to 13,6x, compared to 11,3x as at 31 December Efficiency The cost to income ratio has shown increased in the period ended 30 September Specifically, it increased to 41,2%, compared to 37,4% for the year ended 31 December The increase of the ratio reflects the reduction in net interest income, as a result of the lower loan interest rates and the increase in deposits, and liquidity ratios along with lower returns in liquid assets. The net interest margin for the nine months ended 30 September 2015 decreased to 2,5%, compared to 2,7% at the end of the year ended 31 December 2014 and 3% for the nine months ended 30 September The network was reduced to 253 branches as at 30 September 2015, compared to 292 branches as at 31 December 2014, as part of the implementation of the Restructuring Plan with an aim to rationalize the branch network and at the same time maintain a wide presence of the Cooperative Credit Sector throughout the island. The number of Group employees of the Credit Sector as at 30 September 2015 was reduced to 2659, compared to 2703 employees as at 31 December 2014, as a result of the merger between the most significant in size commercial activities of the CCS with SOPAZ. The number of Group employees is expected to be reduced further with the disposal of the commercial activities by the end of 2016, within the framework of the implementation of the Restructuring Plan.

3 C. Comments on the progress in the implementation of the Restructuring Plan In order to ensure the timely and efficient implementation of the Restructuring Plan (RP) a Restructuring Unit was set up in the Cooperative Central Bank in March The required actions for the implementation of the RP have been divided into four basic pillars, being: Corporate Governance and Risk Management Cost reduction / Efficiency improvement Managing Non-Performing Loans Commercial and other non-core activities The progress achieved so far presented below: Strengthening Corporate Governance and Risk Management On 10 March 2014 CCB was recapitalised with the transfer of an ESM Bond valued 1.5 bln and the issue of the corresponding shares in favour of the Cyprus Government. By the end of April 2014 the recapitalisation of the 18 CCIs from CCB was also completed. The mergers of the 93 CCIs to 18 new entities were completed on 22 March Subsequently, the appointment of the Directors, Committees and the remaining Senior Management of each of the 18 CCIs was also completed. Meanwhile, the new organizational structure of CCB was implemented with a strengthened role of CCB as a Central Body, providing guidance and ensuring compliance with the supervisory requirements and common policies. The Provisioning Policy was revised on the basis of the new Directive of the Central Bank of Cyprus and has already been implemented on the Financial Statements for the year ended 31 December 2013 and thereafter. It is noted that a common credit policy has also been prepared and implemented throughout the Cooperative Credit Sector. In addition risk limits under the framework of Risk Appetite, have been set and are being reviewed regularly on a consolidated Credit Sector basis, regarding all significant risks that the Organization is exposed to. The Internal Audit and Risk Management Units of the CCIs were reinforced with emphasis given to the independence of the Internal Auditors, who now report directly to the Audit Committee of CCB. At the same time it is noted that the Risk Management Unit is independent and reports directly to the Risk Management Committee of the CCB. Operational Regulations for CCB s Committee and its Committees have been prepared, which define the roles and approved limits for the Committee, General Manager and Senior Management team of the Bank. Similar operational regulations have been prepared for all CCIs. The regulations have been implemented following their approval by CCB s Committee.

4 The Compliance Unit has prepared a code of conduct for all employees in the Cooperative Credit Sector, which was implemented on December Also in December disciplinary codes for CCB and CCIs were completed, and after approval by CCB Committee they have been communicated to CCIs for implementation. A project for enhancing the Management Information System is in progress. This project consists of 14 sub - projects and is carried out under an Action Plan as prepared in collaboration with a consultancy firm in line with the memorandum of understanding (MoU) obligations of the CCB. On 6 April 2015, the (a) Risk Charter of CCB and its affiliated CCIs and (b) the revised Credit Policy Manual have been implemented. Cost reduction / Efficiency improvement To meet the targets set out in the RP the following actions were taken: The salaries were reduced by more than 15%, on an annual basis. A Voluntary Retirement Scheme was implemented in April The scheme was taken up by 297 employees, with an annual reduction in staff costs of 12.7 mln. The rationalization of the branch network has been initiated on the basis of the provisions of the Restructuring Plan with emphasis on the preservation of the local character of the Cooperative Sector to the largest extent possible. Overall, a huge effort has been made for the substantial reduction in the operational expenses of the CCB and the CCIs during 2014 and to maintain those levels in the coming years. Managing Non-Performing Loans As of 1 st May 2014 a centralized division for the management of Non-Performing Loans has been set up and it is fully operational, both in the center as well as through offices in all districts. The Division is responsible for managing loans in arrears and terminated loans through an Arrears and Restructuring Unit and a Debt Recoveries Unit, respectively. Additionally, departments for managing, smaller in value, loans in arrears were formed in the CCIs. From the establishment of the Non-Performing Loans Division until the present, the staff is under continuous training, and contacts with clients are being made so as to proceed with loan restructurings, whilst demonstrating appropriate sensitivity to vulnerable groups of the population.

5 The Strategy for Arrears Management was completed and the common policies for arrears management have been prepared and implemented since June 2014 (Arrears Management Policy, Write offs Policy, Debt Recovery Policy). The Non-Performing Loans Management Division is proceeding with mapping / categorisation of the portfolio and the adoption of best standardized approaches for each category in order to achieve comprehensive and effective management of the portfolio of the CCS and the minimize the time required for its effective management. On 22 May 2015 the CCB website regarding sale of real estate was initiated so as to improve the information available to the public ( Recently, since mid-august 2015, the Non-Performing Loans Management Division (NPLD) has engaged a consultancy firm with international experience in managing loans in arrears, aiming to effectively manage this major issue. This firm provides services to the NPLD on a continuous basis. Commercial and other non-core activities An internal viability study for the commercial activities of CCB and CCIs has been carried out. Subsequently, a valuation of the commercial activities of CCB and the most significant (in terms of size) commercial activities of the CCIs was undertaken by independent valuers. As part of the study suggestions in relation to the restructuring of the aforementioned activities and the possible merger of these activities with another Cooperative society were submitted. In addition a detailed plan and policy have been produced regarding the disposal of the commercial activities and the participations of the Group in companies outside the credit sector, in line with the relevant provisions of the RP. Both the policy and the disposal plan have been amended so as to simplify the sale procedure and improve the effectiveness of the framework regarding the disposal of commercial activities and participations. Under the implementation of the plan for the disposal of the commercial activities, the most significant (in terms of size) commercial activities of CCS have merged with SOPAZ Ltd, CCS already held a controlling interest in SOPAZ. The merger aims to improve the financial performance of SOPAZ and increase its value through the utilization of synergies that are expected to occur after the merger. In addition the project regarding the valuation of significant participations in non-credit companies was assigned to independent advisors. The deadline for the submission of the valuations was within the 3 rd quarter of The valuation reports have been submitted and are currently reviewed by the CCB. 12/11/2015