Unaudited financial statements of Zagrebačka banka Group for the period from 1 January 2018 to 31 March 2018 Content:

Transcription

1 Unaudited financial statements of Zagrebačka banka Group for the period from 1 January 2018 to 31 March 2018 Content: 1. Management report for the period from 1 January 2018 to 31 March Statement of the persons responsible for the preparation of the financial statements 3. Financial statements (TFI-KI statements) 3.1. Balance sheet as at 31 March Income statement for the period from 1 January 2018 to 31 March Cash flow statement for the period from 1 January 2018 to 31 March Statement of changes in equity for the period from 31 December 2017 to 31 March Notes to the financial statements

2 Management report for the period from 1 January to 31 March 2018 Zagrebačka banka Group recorded a profit after tax of HRK 470 million in the first three months of 2018, thanks to the stable operating result and good management of risks. Thanks to positive macroeconomic trends a slight increase was realised in new loans approved in retail and corporate segments, while the total volume of loans decreased due to deleveraging in public sector and change in the regulatory environment. The Group realised solid business results in majority of its members, the major contributors were Zagrebačka banka dd, UniCredit Bank dd Mostar, UniCredit Leasing Croatia doo and Prva stambena štedionica dd. In the upcoming period as well, the Group will be focused on transformation of business aiming at improving clients experience, education of our employees and introduction of simpler processes based on digital technologies. Key performance indicators in 2018: Zagrebačka banka Group operating income totals HRK 1,306 million Total operating expenses amount to HRK 678 million Profit before impairment and other provisions amounts to HRK 628 million Impairment and other provisions amount to HRK 80 million Net loans to customers amount to HRK 77,494 million Deposits from customers amount to HRK 92,978 million

3 Management report for the period from 1 January to 31 March 2018 (continued) Operating income amounted to HRK 1,306 million, increased by HRK 47 million (+3.7%): Net interest income amounted to HRK 831 million, under the influence of lower average volume of loans and the decrease in interest rates on assets and net interest margin. Net fee and commission income amounted to HRK 325 million and it is at the same level as in the previous year. Net trading and other income amounted to HRK 150 million, increased by HRK 82 million (+120.6%), due to higher trading result. Operating expenses amounted to HRK 678 million, increased by HRK 7 million (+1.0%). Cost to income ratio ( C/I ratio ) equals 51.9%. Profit before impairment and other provisions amounted to HRK 628 million. The increase of HRK 40 million (+6.8%) is a result of the previously described movements in Operating income and Operating expenses. Impairment and other provisions amounted to HRK 80 million, they have decreased by HRK 710 million. Impairment losses on placements to companies have been significantly increased in the first quarter of In 2018 the ratio of non-performing loans decreased and the coverage of the non-performing loans increased. Total assets of the Group amounted to HRK 127,770 million and have slightly increased by HRK 877 million (+0.7%). Net loans to customers amounted to HRK 77,494 million, decreased by HRK 132 million (-0.2%). Following positive environment trends the loan activity in retail and private sector increased, while the total volume decreased due to deleveraging in public sector and change in regulatory environment (adoption of International Financial Reporting Standard 9). Deposits from customers represent primary source of funding. They amounted to HRK 92,978 million and have decreased by HRK 2,271 million (-2.4%). Loans to deposits ratio amounts to 83.3%. Deposits from banks and borrowings amounted to HRK 11,937 million. The increase of HRK 3,115 million (+35.3%) is a result of management of the balance sheet structure. Capital and reserves of the Group - at HRK 18,087 million.

4 Zagrebačka banka Group Income Statement (HRK mln) Zagrebačka banka Group Balance Sheet (HRK mln) Financial results for the period from 1 January to 31 March 2018 Δ 2018 vs Q Q % HRK mln (4/1) 4 (2-1) Interest income 1,446 1,226 (15.2 %) (220) Interest expense (577) (395) (31.5 %) 182 Net interest income (4.4 %) (38) Fee and commission income % 9 Fee and commission expense (32) (38) 18.8 % (6) Net fee and commission income % 3 Net trading and other income % 82 Operating income 1,259 1, % 47 Operating expenses (671) (678) 1.0 % (7) Profit before impairment and other provisions % 40 Impairment and other provisions (790) (80) (89.9 %) 710 Profit/(loss) from operations (202) Share of profit from associates 10 7 (3) Profit/(loss) before tax (192) Income tax 39 (85) (124) Net profit/(loss) (153) Attributable to equity holders of the Bank (154) Attributable to non-controlling interests Net profit/(loss) (153) Δ 2018 vs Dec Mar 2018 % HRK mln (4/1) 4 (2-1) Cash and deposits with the CNB 18,831 22, % 3,336 Loans to and receivables from financial institutions 13,577 12,029 (11.4 %) (1,548) Securities 11,217 11, % 257 Net loans to customers 77,626 77,494 (0.2 %) (132) Tangible and intangible assets 2,534 2, % 93 Other assets 3,108 1,979 (36.3 %) (1,129) Total assets 126, , % 877 Deposits from customers 95,249 92,978 (2.4 %) (2,271) Deposits from banks and borrowings 8,822 11, % 3,115 Other liabilities 4,711 4, % 57 Capital and reserves 18,111 18,087 (0.1 %) (24) Total liabilities and equity 126, , % 877 Equity attributable to equity holders of the Bank 18,088 18,064 (0.1 %) (24) Equity attributable to non-controlling interests % 0 Zagreb, 27 April 2018 Chairman of the Management Board Miljenko Živaljić

5 Statement of the persons responsible for the preparation of financial statements Pursuant to the provisions of the Capital Market Act, to the best of our knowledge: 1. the set of summary financial statements of Zagrebačka banka Group prepared in accordance with the applicable standards for financial reporting for banks in the Republic of Croatia gives a true and complete view of the assets and liabilities, profit and loss, the financial position and business operations of Zagrebačka banka Group; 2. the Management Report gives a true view of business developments, operating results and the position of Zagrebačka banka Group Head of Accounting and Regulatory Reporting Marijana Brcko Member of the Management Board Lorenzo Ramajola Additional info: Public Relations Tel: 00385(1) PR@unicreditgroup.zaba.hr

6 Appendix 3. Reporting period: to Quarterly financial report for credit institutions-tfi-ki Identification number (MB): Subjects identification number Personal identification number (OIB): Issuer company: Zagrebačka banka d.d. Post office number and city: Zagreb Street and number: Trg bana Josipa Jelačića 10 address: Internet address: ode and name of municipality/city: 133 Zagreb Code and name of county: Consolidated report: 21 Grad Zagreb Number of employees: 5,408 (as at the quarter-end) YES Code in NKD: 6,419 Subsidiaries and associates of the Bank which are included in Zagrebačka banka Group are shown in Note 4: Companies included in consolidation (according to IFRS): Headquarters: MB: Prva stambena štedionica d.d. Samoborska cesta 145, Zagreb ZB Invest d.o.o. Samoborska cesta 145, Zagreb Pominvest d.d. Gundulićeva 26a, Split Zagreb nekretnine d.o.o. Nova Ves 17, Zagreb UniCredit Leasing Croatia d.o.o. Heinzelova 33, Zagreb Locat Croatia d.o.o. Damira Tomljanovića Gavrana 17, Zagreb UniCredit Partner d.o.o. Damira Tomljanovića Gavrana 17, Zagreb ALLIB NEKRETNINE d.o.o. BACAL ALPHA d.o.o. ZABA Partner d.o.o. Damira Tomljanovića Gavrana 17, Zagreb Damira Tomljanovića Gavrana 17, Zagreb Augusta Cesarca 2, Zagreb UniCredit Bank d.d. Kardinala Stepinca bb, Mostar Zane BH d.o.o. Branilaca Sarajeva 20, Sarajevo UniCredit Broker d.o.o. Obala Kulina bana 15, Sarajevo Multiplus card d.o.o., Zagreb Ivana Lučića 2a, Zagreb Allianz ZB d.o.o., Zagreb Heinzelova 70, Zagreb Allianz ZB d.o.o., Zagreb Heinzelova 70, Zagreb Accounting: Contact person: Jurič Ana (only name and surname of contact person is included) Phone: 01/ Telefax: address: Surname and name: Živaljić Miljenko (person representing the company) Documentation to be published: 1. Financial reports (balance, income statement, cash flow statement, statement on changes in equity and notes to financial statements) 2. Interim Management report 3. Statement of persons responsible for preparation of financial reports M.P. (signature of the President of the Management Board)

7 BALANCE SHEET balance as at Position name ASSETS 1. CASH AND DEPOSITS WITH THE CNB ( ) 1.1.Cash 1.2.Deposits with the CNB 2. DEPOSITS WITH BANKING INSTITUTIONS 3. TREASURY BILLS AND CNB BILLS 4. SECURITIES AND OTHER FINANCIAL INSTRUMENTS HELD FOR TRADING 1 5. SECURITIES AND OTHER FINANCIAL INSTRUMENTS AVAILABLE FOR SALE 6. SECURITIES AND OTHER FINANCIAL INSTRUMENTS HELD TO MATURITY AOP code Previous period Amounts in HRK Current period ,831,188,305 22,166,600, ,942,147,850 2,698,091, ,889,040,455 19,468,509, ,223,065,855 9,016,913, ,351,394,625 4,686,001, ,282,895 48,815, ,643,539,574 6,471,111, ,878 51, SECURITIES AND OTHER FINANCIAL INSTRUMENTS WHICH ARE NOT ACTIVELY TRADED, BUT ARE DESIGNATED TO FAIR VALUE THROUGH PROFIT OR LOSS 8. DERIVATIVE FINANCIAL ASSETS 9. LOANS TO FINANCIAL INSTITUTIONS 10. LOANS TO OTHER CUSTOMERS 11. INVESTMENTS IN SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES 12. FORECLOSED ASSETS 13. PROPERTY, PLANT AND EQUIPMENT (NET OF DEPRECIATION) 14. INTEREST, FEES AND OTHER ASSETS A) TOTAL ASSETS ( do 016) LIABILITIES 1. BORROWINGS FROM FINANCIAL INSTITUTIONS ( ) 1.1. Short-term borrowings 1.2. Long-term borrowings 2. DEPOSITS (AOP 022 to 024) 2.1. Giro and current accounts 2.2. Savings deposits 2.3. Term deposits 3. OTHER BORROWINGS ( ) 3.1. Short-term borrowings 3.2. Long-term borrowings 4. LIABILITIES ARISING FROM DERIVATIVES AND OTHER LIABILITIES HELD FOR TRADING 5. ISSUED DEBT SECURITIES ( ) 5.1. Short-term issued debt securities 5.2. Long-term issued debt securities 6. ISSUED SUBORDINATED INSTRUMENTS 7. ISSUED HYBRID INSTRUMENTS 8. INTERESTS, FEES AND OTHER LIABILITIES B) TOTAL LIABILITIES ( ) EQUITY 1. SHARE CAPITAL 2. CURRENT YEAR PROFIT / (LOSS) 3. RETAINED EARNINGS / (LOSS) 4. LEGAL RESERVES 5. STATUTORY AND OTHER CAPITAL RESERVES 6. UNREALISED GAIN / (LOSS) ON VALUE ADJUSTMENT OF AVAILABLE-FOR- SALE FINANCIAL ASSETS ,256, ,958, ,134, ,647, ,354,252,317 3,012,357, ,626,053,850 77,494,183, ,252,488 62,989, ,565,027 87,844, ,424,375,862 2,557,434, ,036,366, ,072, ,892,798, ,769,982, ,854,452,037 3,273,361, ,944,231,655 1,768,186, ,910,220,382 1,505,174, ,635,623,593 98,474,378, ,937,343,716 32,626,528, ,231,437,136 19,874,375, ,466,842,741 45,973,473, ,581,215,496 3,167,427, ,982, ,813, ,261,232,863 2,848,614, ,367, ,964, ,140,708 53,749, ,140,708 53,749, ,843,505,596 3,899,966, ,781,304, ,682,847, ,404,839,100 6,404,839, ,043,626, ,156, ,390,206,985 6,976,443, ,048,522 64,048, ,914,395,982 3,899,295, ,376, ,352, HEDGE ACCOUNTING RESERVES C) TOTAL EQUITY (036 to 042) ,111,494,069 18,087,135,270 D) TOTAL LIABILITIES AND EQUITY ( ) ,892,798, ,769,982,786 BALANCE SHEET SUPPLEMENT (to be inputed by issuer preparing consolidated financial reports) 1. TOTAL EQUITY ,111,494,069 18,087,135, Attributable to equity holders of the Bank ,088,393,325 18,063,790, Attributable to minority interests ( ) ,100,744 23,345,242

8 INCOME STATEMENT for the period to Position name AOP code 1. Interest income 2. Interest expense 3. Net interest income ( ) 4. Fee and commission income 5. Fee and commission expense 6. Net income from commissions and fees ( ) 7. Gains / losses from investment in subsidiaries, associates and joint ventures 8. Gains / losses from trading activities 9. Gains / losses from embedded derivatives 10. Gains / losses from assets which are not actively traded, but are designated at fair 11. Gains / losses from activities related to available-for-sale financial assets 12. Gains / losses from activities related to held-to-maturity investments 13. Gains / losses from hedging transactions 14. Income from investments in subsidiaries, associates and joint ventures 15. Income from other equity investments 16. Gains / losses from foreign exchange differences 17. Other income 18. Other expenses 19. General administrative expenses and depreciation 20. Net income from operations before impairment and other provisions 21. Impairment losses and other provisions 22. PROFIT / LOSS BEFORE TAX ( ) 23. INCOME TAX EXPENSE 24. PROFIT / LOSS FOR THE PERIOD ( ) 25. Earnings per share 1 INCOME STATEMENT SUPPLEMENT (to be inputed by issuer preparing consolidated financial statements) 1. PROFIT / LOSS FOR THE PERIOD 2. Attributable to equity holders of the Bank 3. Attributable to minority interests ( ) Previous period Amounts in HRK Current period Cumulated Quarterly Cumulated Quarterly ,446,478,578 1,446,478,578 1,226,131,789 1,226,131, ,687, ,687, ,976, ,976, ,791, ,791, ,155, ,155, ,297, ,297, ,537, ,537, ,836,877 31,836,877 38,445,183 38,445, ,460, ,460, ,092, ,092, ,583,613 9,583,613 7,108,532 7,108, ,823,800-71,823,800-30,092,936-30,092, ,325,297 1,325,297 7,926,430 7,926, ,191,167 1,191,167 4,618,335 4,618, ,002 75,002 82,179 82, ,440,213 52,440,213 82,915,578 82,915, ,654,060 84,654,060 84,580,410 84,580, ,738, ,738, ,455, ,455, ,063, ,063, ,563, ,563, ,895, ,895, ,367, ,367, ,105, ,105,244 80,139,635 80,139, ,210, ,210, ,227, ,227, ,414,203-39,414,203 85,070,863 85,070, ,795, ,795, ,156, ,156, ,795, ,795, ,156, ,156, ,410, ,410, ,471, ,471, , , , ,492

9 CASH FLOW STATEMENT - Indirect method in the period from to Amounts in HRK Position name AOP code Previous period Current period Operating activities 1. Cash flow from operating activities before changes in operating assets (002 do 007) 1.1.Profit/(loss) before tax 1.2. Impairment losses 1.3. Depreciation and amortisation 1.4. Unrealised (gains)/losses on securities at fair value through profit or loss 1.5. (Gains)/losses from sale of tangible assets 1.6. Other (gains)/losses 2. Net Increase/decrease in operating assets (009 do 016) 2.1. Deposits with the CNB 2.2. Ministry of Finance treasury bills and CNB bills 2.3. Deposits with banking institutions and loans to financial institutions 2.4. Loans to other clients 2.5. Securities and other financial instruments held for trading 2.6. Securities and other financial instruments available for sale 2.7. Securities and other financial instruments at fair value through profit or loss which are not actively traded 2.8. Other operating assets 3. Net (increase)/decrease in operating liabilities (018 do 021) 3.1. Demand deposits 3.2. Savings and term deposits 3.3. Derivative financial liabilities and other liabilities held for trading 3.4. Other liabilities 4. Net cash flow from operating activities before income taxes paid ( ) 5. Paid income tax 6. Net inflow/(outflow) of cash from operating activities ( ) Investment activities 7. Net cash flow from investment activities (026 do 030) 7.1. Receipts from sale of / (payments to acquire) property, plant and equipment and intangible assets 7.2. Receipts from disposal of / (payments for purchase) investments in subsidiaries, associates and joint ventures 7.3. Receipts from sale of / (payments to acquire) securities and other investments held to maturity 7.4. Received dividends 7.5. Other receipts/(payments) from investment activities Financial activities 8. Net cash flow from financing activities (032 do 037) 8.1. Net increase/(decrease) in borrowings 8.2. Net increase /(decrease) of issued debt securities 8.3. Net increase /(decrease) of subordinated and hybrid instruments 8.4. Receipts from issue of capital 8.5. Payment of dividends 8.6. Other receipts/(payments) from financial activities 9. Net increase/(decrease) in cash and cash equivalents ( ) 10. Effects of foreign exchange differences on cash and cash equivalents 11. Net increase/(decrease) in cash and cash equivalents ( ) 12. Cash and cash equivalents at the beginning of the year 13. Cash and cash equivalents at the end of the year ( ) ,800, ,437, ,210, ,227, ,858,814 80,139, ,119,608 86,420, ,024, ,484, ,374,814-6,375, ,617, ,510, ,027,612, ,671, ,012,921 13,114, ,332, ,078, ,580,389, ,936, ,921,921, ,825, ,190,504 44,587, ,464,762-66,889, ,626 72,636, ,236, ,189, ,285,451,685 1,455,513, ,933, ,717, ,331,838, ,035, , ,120,527 11,760, ,038,298 2,949,623, ,884,668-88,985, ,922,966 2,860,637, ,448, ,400, ,923, ,450, ,435,621-1,050, ,572 17, ,021,677 82, ,607,004 5,651, ,411,710 6,208, , , , ,764,258 2,684,888, ,223,685-42,061, ,987,943 2,642,826, ,812,760,339 17,837,378, ,003,772,396 20,480,205,587

10 Position name in the period from AOP code STATEMENT OF CHANGES IN EQUITY to Attributable to shareholders of the Bank Share capital Treasury shares Legal, statutory, capital and other reserves Retained earnings/ loss Profit/loss for the year Unrealised gain/loss from revaluation on AFS financial assets Minority interests Amounts in HRK Total Balance as at 1 January of the current period Changes in accounting policies and errors Restated balance as at 1 January of the current period ( ) Disposal of available-for-sale financial assets Changes in fair value of available-for-sale financial assets 1 Deferred tax on movements in fair value reserve of available-for-sale financial assets ,404,839, ,978,444,504 6,369,550,611 1,041,182, ,376,892 23,100,744 18,111,494, ,151, ,111, ,262, ,404,839, ,978,444,504 5,944,399,526 1,041,182, ,265,428 23,100,744 17,649,231, , ,819, ,596, ,342,785 32,713 24,375, ,296, ,296,834 Other gains/losses recognised directly in equity Net gains/losses recognised directly in equity ( ) Profit / loss for the period Total recognised income and expense for the current period ( ) Increase / decrease of share capital Acquisition / disposal of treasury shares Other movements Transfer to reserves Dividends payouts Distribution of profit ( ) Balance as at 31 December of the current period ( ) Banks w hich prepare consolidated annual financial statements separately disclose changes in minority interests in the relevant sections of equity ,676-31,798, , ,706-32,409, ,094-31,798, ,086, ,993-15,927, ,471, , ,156, ,094-31,798, ,471,111 16,086, , ,229, ,325, ,325, ,041,182,218-1,041,182, ,041,182,361-1,041,182, ,404,839,100-15,325,806 3,978,669,598 6,953,783, ,471, ,352,377 23,345,243 18,087,135,270 The impact of obligatory adoption of IFRS 9 Financial instruments and the CNB s Decision on classification of exposures to risk classes and method to determine credit losses (Official Gazette no. 114/2017) is presented within the position Changes in accounting policies and errors.

11 NOTES TO THE FINANCIAL STATEMENTS in HRK Liquid assets Cash 2,942,147,850 2,698,091,650 Deposits w ith the CNB 15,889,040,455 19,468,509,252 Deposits w ith banking institutions 11,223,065,855 9,016,913,800 Treasury bills and CNB bills 4,351,394,625 4,686,001,058 Securities and other financial instruments held for trading 95,282,895 48,815,138 Secutiries and other financial instruments available for sale 6,643,539,574 6,471,111,858 Securities and other financial instruments w hich are not actively traded, but are designated to fair value in income statement 126,256, ,958,343 41,270,728,069 42,657,401,099 Loans to and receivables from customers Companies and similar organisations and government 49,261,588,112 48,692,814,050 Individuals and unincorporated businesses 35,445,676,829 36,200,882,818 Total gross loans 84,707,264,941 84,893,696,868 Companies and similar organisations and government (5,584,488,219) (5,651,290,020) Individuals and unincorporated businesses (1,496,722,872) (1,748,222,908) Impairment allow ance (7,081,211,091) (7,399,512,928) 77,626,053,850 77,494,183,940 Deposits and borrow ings Companies and similar organisations and government 33,869,062,223 31,810,575,576 Individuals and unincorporated businesses 61,380,113,313 61,167,919,916 Banks and other financial institutions 8,822,115,590 11,936,671, ,071,291, ,915,167,332

12 List of subsidiaries and associates Zagrebačka banka d.d. is a licensed bank operating in Croatia and the holding company for the Zagrebačka banka Group. The Bank's subsidiaries and associated companies are presented below : Fully consolidated subsidiaries: Company Group Group ownership in % UniCredit Bank d.d., Mostar Banking 99.3 Prva stambena štedionica d.d. Banking ZB Invest d.o.o. Fund management Pominvest d.d. Property management 88.7 Zagreb nekretnine d.o.o. Real estate agency Zane BH d.o.o. Real estate agency UniCredit Leasing Croatia d.o.o. Leasing Locat Croatia d.o.o. Real estate business UniCredit Partner d.o.o. Trading activities 80.0 ALLIB NEKRETNINE d.o.o. Real estate business BACAL ALPHA d.o.o. Real estate business ZABA Partner d.o.o. Insurance brokerage Equity accounted associated companies: Company Allianz ZB d.o.o., Zagreb Allianz ZB d.o.o., Zagreb Multiplus card d.o.o., Zagreb Group ownership Group in % Obligatory pension fund management 49.0 Voluntary pension fund management 49.0 Advertising and marketing services 25.0 UniCredit Broker d.o.o. Sarajevo brokersko društvo u osiguranju Insurance brokerage 48.7 Changes in the scope of consolidation In February 2018 the Group sold its stake in the company Centar Kaptol doo, Zagreb.

13 Net interest income Previous period Current period Interest and similar income 1,446,478,578 1,226,131,789 Loans to and receivables from customers 1,029,442, ,343,470 Debt securities 50,481,101 48,931,412 Loans to and receivables from banks 8,015,450 12,934,711 Derivative instruments 358,539, ,922,196 Interest expense and similar charges 576,687, ,976,691 Current accounts and deposits from banks 19,892,124 5,604,563 Current accounts and deposits from individuals 135,284,010 85,006,806 Current accounts and deposits from companies and other organisations 43,769,383 19,237,159 Borrow ings 30,118,177 20,139,495 Derivative instruments 347,623, ,791,568 Other 0 197, ,791, ,155,098 Net fee and commission income Previous period Current period Fee and commission income 354,297, ,537,899 Domestic payment transaction related fees and commissions 132,492, ,280,907 Credit card related fees and commissions 70,023,748 86,367,267 Foreign payment transaction related fees and commissions 34,535,892 22,039,719 Investment management, brokerage and consultancy fees 65,344,290 56,399,246 Other fees and commissions 51,900,467 48,450,760 Fee and commission expense 31,836,877 38,445,183 Credit card related charges 17,571,945 24,365,323 Domestic payment transaction related charges 8,656,532 9,142,115 Foreign payment transaction related charges 1,368,294 1,502,459 Other fees and commissions 4,240,106 3,435, ,460, ,092,716 Impairment losses and provisions Previous period Current period Impairment losses on loans to and receivables from customers (791,229,613) (100,986,274) Other impairment losses and provisions 1,124,369 20,846,639 (790,105,244) (80,139,635) Earnings per share Previous period Current period Profit/(loss) attributable to equity holders of the Bank 1,041,182, ,471,111 Weighted average number of ordinary shares in issue 320,233, ,012,893 Basic and diluted earnings per share (expressed in HRK per share)