Fixed Income Presentation. Milan 16 November, 2017

Transcription

1 Fixed Income Presentation Milan 16 November, 2017

2 Disclaimer This Presentation may contain written and oral forward-looking statements, which includes all statements that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward-looking statements rely on a number of assumptions, expectations, projections and provisional data concerning future events and are subject to a number of uncertainties and other factors, many of which are outside the control of UniCredit S.p.A. (the Company ). There are a variety of factors that may cause actual results and performance to be materially different from the explicit or implicit contents of any forward-looking statements and thus, such forward-looking statements are not a reliable indicator of future performance. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. The information and opinions contained in this Presentation are provided as at the date hereof and are subject to change without notice. Neither this Presentation nor any part of it nor the fact of its distribution may form the basis of, or be relied on or in connection with, any contract or investment decision. The information, statements and opinions contained in this Presentation are for information purposes only and do not constitute a public offer under any applicable legislation or an offer to sell or solicitation of an offer to purchase or subscribe for securities or financial instruments or any advice or recommendation with respect to such securities or other financial instruments. None of the securities referred to herein have been, or will be, registered under the U.S. Securities Act of 1933, as amended, or the securities laws of any state or other jurisdiction of the United States or in Australia, Canada or Japan or any other jurisdiction where such an offer or solicitation would be unlawful (the Other Countries ), and there will be no public offer of any such securities in the United States. This Presentation does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States or the Other Countries. Pursuant the consolidated law on financial intermediation of 24 February 1998 (article 154-bis, paragraph 2) Francesco Giordano, in his capacity as manager responsible for the preparation of the Company s financial reports declares that the accounting information contained in this Presentation reflects the UniCredit Group s documented results, financial accounts and accounting records. This Presentation has been prepared on a voluntary basis since the financial disclosure additional to the half-year and annual ones is no longer compulsory pursuant to law 25/2016 in application of Directive 2013/50/EU, in order to grant continuity with the previous quarterly presentations. The UniCredit Group is therefore not bound to prepare similar presentations in the future, unless where provided by law. Neither the Company nor any member of the UniCredit Group nor any of its or their respective representatives, directors or employees accept any liability whatsoever in connection with this Presentation or any of its contents or in relation to any loss arising from its use or from any reliance placed upon it. 2

3 Agenda 1 UniCredit at a glance 2 Transform 2019 update 3 3Q17 P&L results 4 Asset quality 5 Capital position 6 Funding & Liquidity 7 Concluding remarks 3

4 Adjusted net profit (1) at 838m up 87% Y/Y thanks to tangible results of Transform 2019 and underlying Group-wide business momentum UniCredit at a glance Strong commercial dynamics thanks to network revamp. YTD: Number of clients increased by 423,000 (2) and 52bn of new loan production. 9M17 vs. 9M16: AuM up 15.3bn (+7.8%) and fees up 261m (+5.5%) Operating model transformation ahead of plan, with 59% of planned branch closures and 51% of FTE reductions already achieved. FY17 total costs expected to be marginally lower than the 11.7bn target 3Q17 CoR at a low 53 bps. FY17 CoR estimated to be between 55 and 60bps. Expected Loss of the stock and new origination at 38bps and 34bps respectively, both down 1bp Q/Q, supported by strict risk discipline 3Q17 fully loaded CET1 ratio at a high 13.81%, thanks to Pioneer disposal and earnings generation 4 1. Adjusted net profit excluding the net impact from Pioneer (+2.1bn 3Q17) disposal and a one-off charge booked in Non Core (-80m in 3Q17) related to FINO. All costs and charges pertaining to the FINO transaction have been accounted for, including a one-off charge of 80m booked in Non Core in 3Q17 as included in the disclosure on 24 October 2017 of 3Q preliminary results 2. Calculated as difference between number of clients at beginning and end of period

5 UniCredit: a simple successful Pan European Commercial Bank with inherent competitive advantages and CIB fully plugged-in UniCredit at a glance Commercial Banking model delivering unique Western, Central and Eastern European network to extensive Retail and Corporate client franchise "One Bank" business model replicated across full network, driving synergies and streamlined operations CIB plugged into Commercial Banking, enabling cross-selling and synergies across business lines and countries 25 million clients (1) 80% revenues from Commercial Banking (2) Commercial Banks with leadership position (3) in 13 out of 14 countries (4) 2.1bn joint CIB-Commercial Banking revenues (5) Low risk profile business model benefiting from diversification and a more stable macro/regulatory environment 93% revenues in EU 54% outside Italy 5 1. Data as of 9M2017, includes 100% clients in Turkey 2. CBK Italy, CBK Germany, CBK Austria, CEE 3. Data as of 9M2017 or latest available, ranking between #1 and #5 of market share in terms of total assets according to local accounting standard 4 Italy, Germany, Austria, Czech Republic, Slovakia, Hungary, Slovenia, Croatia, Bosnia and Herz., Serbia, Russia, Romania, Bulgaria, Turkey 5. Data as of 9M2017 includes revenues on GTB, ECM, DCM, M&A, Markets products from Commercial Banking clients and structured financing products from Corporate clients Note: Revenues data as of 9M2017 Sources: for total assets, central bank statistics, if available, or local company reports

6 Strong competitive advantage across countries and products UniCredit at a glance Strong local Commercial Bank # clients, m (1) Rank by assets in Europe (2) "Go to" bank for European "Mittelstand" Corporates Loans to corporates in EU zone, bn (3) EMEA rankings (5) Best-in-class CIB product provider Italy Germany Austria CEE Revenues by geography (4) CEE 20% Austria 9% 46% Italy 24% Germany Peer 1 UniCredit Peer 2 Peer 3 Peer 4 Peer 5 EMEA Bonds in Euro by # of transactions (5) 1 Syndicated Loans in Italy (5) Syndicated Loans in Germany (5) Syndicated Loans in Austria (5) Awards Best Trade Finance Provider in Western Europe and CEE in 2017 (6) Best Bank in Cash Management in 11 countries (7) Five-Star Cash Manager in Western Europe and CEE in 2017 (8) Data as of 3Q17, includes 100% clients on Turkey 2. Data as of 9M17, for Austria domestic assets as of end of 2015 on local GAAP (source OeNB), for Germany data as of FY16, only private banks; for CEE compared to Erste, KBC, Intesa Sanpaolo, OTP, RBI, Société Générale (data as of 9M17) 3. Data as of 9M17; peers includes: BNP Paribas, Deutsche Bank, Intesa Sanpaolo, Santander, Société Générale 4. Data as of 9M17 based on Regional view 5. Dealogic, as of 4 October Source: EuroMoney Trade Finance Survey Source: EuroMoney Cash Management Survey 8. Source: EuroMoney Cash Management

7 Agenda 1 UniCredit at a glance 2 Transform 2019 update 3 3Q17 P&L results 4 Asset quality 5 Capital position 6 Funding & Liquidity 7 Concluding remarks 7

8 UniCredit key targets Transform 2019 update Q17 9M Revenues (1) 19.9bn 4.6bn 14.8bn 20.4bn Cost/income 61.6% 60.5% 57.9% <52% Cost 12.2bn 2.8bn 8.6bn 11.7bn 10.6bn Cost of Risk 89bps 53bps 54bps 55 to 60bps 49bps Net income 1.5bn 2.8bn 4.7bn 4.7bn RoTE (2) 4% 6.8% 7.8% >9% CET1 FL ratio 10.4% 13.81% (3) >12.0% >12.5% RWA 361bn 350bn 389bn 404bn Group Gross NPE Stock 77.8bn 51.3bn 44.3bn Group Net NPE Stock 38.3bn 22.3bn 20.2bn Group NPE Coverage 50.8% 56.5% >54% >54% Group UTP Coverage 34.2% 44.0% >38% >38% Group Bad Loan Coverage 60.6% 66.2% >65% >63% Non Core Net NPE 24.8bn 12.4bn 11.4bn 8.1bn Non Core NPE Coverage 52.4% 57.1% >56% >57% 8 1. Revenues CAGR at 0.6% 2. RoTE adjusted excluding the net impact from the Pekao (-310m FX reserve in 2Q17) and Pioneer (+2.1bn in 3Q17) disposals and a one-off charge booked in Non Core (-80m in 3Q17) related to FINO. All costs and charges pertaining to the FINO transaction have been accounted for, including a one-off charge of 80m booked in Non Core in 3Q17 as included in the disclosure on 24 October 2017 of 3Q preliminary results. RoTE calculated at CMD perimeter, considering also the capital increase and Pekao & Pioneer disposals as at 1 January Assuming foreseeable dividends calculated as at 30 September 2017 equals to 20% payout ratio on normalised earnings excluding the net impact of Bank Pekao and Pioneer disposals Note: All 2015 figures restated assuming new Group perimeter; Transform 2019 plan assumes a cash dividend with 20% payout

9 Transform 2019 achievements (1/2) Transform 2019 update 5 Strategic Pillars Achieved 2019 Target All decisive actions announced at the Capital Markets Day successfully completed STRENGTHEN AND OPTIMIZE CAPITAL Bold actions taken: disposals of Pioneer, Pekao and 30% of Fineco 13bn rights issue successfully executed Pioneer disposal closed in 3Q17, with +84bps positive impact on fully loaded CET1 ratio Fully loaded CET1 ratio at 13.81% at end of 3Q17 S&P upgraded UniCredit SpA to 'BBB' stable outlook (from 'BBB-' stable) supported by the successful execution of Transform 2019 CET1 ratio >12.5% IMPROVE ASSET QUALITY Decisive actions to address Italian legacy issues Strengthened coverage ratio Further tightened risk discipline FINO Phase 1 successfully closed in July, Phase 2 progressing well, expecting to sell down below 20% by year end Disposals of 2.4bn (1) NPE portfolios in 9M17 Gross NPE ratio down by 34bps to 10.6% in 3Q17, while the coverage ratio remains solid at 56.5% Net NPE ratio 4% NPE Coverage >54% Cost of Risk 49bps 1. Of which 1.2bn in Non Core 9

10 Transform 2019 achievements (2/2) Transform 2019 update 5 Strategic Pillars Achieved 2019 Target TRANSFORM OPERATING MODEL MAXIMIZE COMMERCIAL BANK VALUE Transformation of operating model to a sustainable lower cost structure Improve customer focus, services & products 1.6 bn IT investments (1) to support business transformation Leverage on CIB leadership Increase CEE client penetration Enhance cross-selling across business lines and countries 557 branch closures since Dec-15 in Western Europe, 59% of 944 target FTEs down 7,232 since Dec-15, 51% of 14,000 target. FTEs down 1,223 Q/Q Ranking #1 in Syndicated Loans in Italy, Germany and Austria, #2 in Syndicated Loans in CEE and #1 in EMEA All Covered Bonds in Euro (2) Number of remote sales (3) increased in Italy by 40% Y/Y reaching 18.6% of total sales (4) in 3Q17 Number of online and mobile users in CEE increased to 39.7% and 28.3% in 3Q17 Further progress in E2E process/product redesign 1.7 bn net cost savings by 2019 C/I ratio <52% 944 branch reduction in Western Europe Additional 363 m joint CIB- Commercial Banking revenues (5) 856 bn TFA 10 ADOPT LEAN BUT STEERING CENTER Effective steering Group Corporate Center KPIs to drive performance and accountability Leaner support functions and transparent cost allocation Since Dec-15 FTEs down 8.8% (-1,534 FTEs). Trend confirmed in 3Q17 Weight of Group Corporate Centre on total costs at 3.9% in 3Q17 (2015 actual: 5.1%, 2019 target: 2.9%) down 30bps Q/Q Weight of Group Corporate Center on total costs from 5.1% to 2.9% by Excluding 0.7 bn investments to fulfill regulatory demand in Source: Dealogic, as at 30 September Syndicated Loans: Italy, Germany and Austria by number of deals and deal value, CEE by deal value; EMEA All Covered Bonds in Euro by number of deals 3. Transactions concluded through ATM, online, mobile or Contact Centre 4. Percentage of remote sales calculated on total bank products that have a direct selling process 5. Includes revenues on GTB, ECM, DCM, M&A, Markets products from Commercial Banking clients and structured financing products from Corporate clients

11 Agenda 1 2 UniCredit at a glance Transform 2019 update 3 3Q17 P&L results 4 Asset quality 5 Capital position 6 Funding & Liquidity 7 Concluding remarks 11

12 Group Adjusted net profit up 87% Y/Y thanks to strong underlying commercial performance, down 33% Q/Q impacted by seasonality Key drivers (1) Data in m 3Q16 2Q17 3Q17 % vs. 2Q17 % vs. 3Q16 9M16 3Q17 P&L results 9M17 % vs. 9M16 Total revenues 4,835 5,076 4, % -3.9% 15,190 14, % Net interest in 3Q17 decreased 5.7% Q/Q or 2.4% excluding oneoff in CBK Germany in 2Q17 (+90m). Down 3.5% Y/Y mainly due to continued spread compression Fees increased 4.2% Y/Y thanks to investment and transactional fees. Q/Q down 7.9% due to seasonality Costs down 1.6% Q/Q thanks to lower HR costs (-2.3% Q/Q) and Non HR costs (-0.4% Q/Q). FY17 total costs expected to be marginally lower than the 11.7bn target Low level of LLP at 598m in 3Q17 leading to 53bps CoR, FY17 CoR estimated to be between 55 and 60bps Systemic charges increased 130m Q/Q mainly due to Deposit Guarantee Scheme and Voluntary Scheme in Italy Net profit from discontinued operations includes Pioneer disposal (+2.1bn) o/w Net interest 2,591 2,652 2, % -3.5% 7,893 7, % o/w Fees 1,527 1,730 1, % +4.2% 4,763 5, % o/w Trading % -20.3% 1,675 1, % Operating costs -2,940-2,858-2, % -4.3% -8,898-8, % Gross operating profit 1,896 2,218 1, % -3.3% 6,292 6, % Loan loss provisions % -38.8% -2,621-1, % Net operating profit 919 1,654 1, % +34.4% 3,672 4, % Other charges & provisions n.m % -1, % o/w Systemic charges n.m % % Profit before taxes 638 1, % +45.2% 2,181 3, % Income taxes % -34.5% % Net profit from discontinued operations ,126 n.m. n.m ,155 n.m. Net profit ,820 n.m. n.m. 1,768 4,672 n.m. Adjusted net profit (2) 447 1, % +87.4% 1,739 3, % Please consider that across the document, all 2016 and 2017 figures were restated for the consolidation effects arising from the intercompany fees relating to Bank Pekao and Pioneer, which until 2Q17 were classified as held for sale, in accordance to IFRS5 principle 2. Adjusted net profit excluding the net impact from the Pekao (-310m FX reserve 2Q17) and Pioneer (+2.1bn 3Q17) disposals and a one-off charge booked in Non Core (-80m in 3Q17) related to FINO. All costs and charges pertaining to the FINO transaction have been accounted for, including a one-off charge of 80m booked in Non Core in 3Q17 as included in the disclosure on 24 October 2017 of 3Q preliminary results

13 Group Lower recurring revenues Q/Q affected by low interest rate environment and seasonality of fees in 3Q Q17 P&L results Net Interest, m Fees & commissions, m -3.5% -5.7% 7, % 7,716 Average Euribor 3M +4.3% +5.5% 4,763 5,025 1,852 2,083 2,591 3Q16 2,652 2Q17 2,500 3Q17 Net interest 1.30% 1.42% 1.35% margin 9M16 9M % (flat Q/Q) Investment fees Financing fees Transactional fees 1, Q16-7.9% 1,730 1, Q17 3Q17 1,372 1,288 1,540 1,653 9M16 9M17 3Q17 NII positive contribution from deposits rate and term funding partially offsetting effects from lower rates and average loan volumes. FY17 guidance confirmed at 10.2bn 3Q17 fees up 4.2% Y/Y supported by investment and transactional fees. Seasonally lower contribution Q/Q of investment and financing fees 13

14 Group Trading income down 17.6% Q/Q in an unfavourable sector-wide environment Trading income, m Client driven -14.4% Other trading 1,675 1, % 1, % 1, Q16 2Q17 3Q17 9M16 9M17 Other dividends and equity investments Q % 2Q17 Dividends (1), m Turkey (at equity) -10.0% 3Q17 669m exc. Visa Europe 3Q17 P&L results -25.5% M16 9M17 Lower client (2) activity by 43% Q/Q due to unfavourable sectorwide environment Other trading income excluding non-recurring capital gains (3) in 3Q17 down by 51.8% Q/Q Turkey's contribution flat Q/Q mainly due to FX movement (at constant FX, +4.1% Q/Q) Other dividends down to 80m due to lower contribution from insurance and other participations Figures include dividends and equity investments. Turkey contribution at equity based on divisional view 2. Client driven trading includes value adjustments equal to +8m in 3Q17: credit value adjustments of - 5m, funding value adjustment of +10m and fair value adjustment of +2m 3. 3Q17 non-recurring capital gains pre tax: +87m in CIB and +39m in CBK Germany

15 15 Group Costs 1.6% lower Q/Q and 4.3% Y/Y, ahead of plan on better FTE and branch reduction Main drivers Execution of Transform 2019 progressing well: 51% of FTE reduction target achieved 59% of branch closures reached FTE down 5,117 Y/Y Branches in Western Europe further down 377 Y/Y C/I down to 58% in 9M17 FY17 total costs expected to be marginally lower than the 11.7bn target, despite seasonal increase in HR and Non HR costs in 4Q17 FY bn total costs target confirmed 1. Branch figures consistent with CMD perimeter C/I 2,940 3Q16-4.3% 2,858 2Q17-1.6% Costs, m 2,813 3Q17 8,898 9M16-3.8% 8,557 9M % 56.3% 60.5% 58.6% 57.9% CEE WE CEE WE 99,183 24,490 74,693 3Q16 5,490 1,861 3,629 3Q16-5,117 95,288 24,254 71,035 2Q17 FTEs -1,223 Branches (1) ,109 1,764 3,345 2Q Q17 P&L results 94,066 24,134 69,932 3Q17 4,975 1,723 3,252 3Q17 Q/Q -0.5% -1.6% Q/Q -2.3% -2.8%

16 Group Low CoR of 53bps in 3Q17. FY17 CoR expected to be between 55 and 60bps Main drivers (1) Loan loss provisions, m 3Q17 P&L results LLPs on a low level at 598m, with CoR at 53bps in 3Q17 and at 54bps at 9M17 Gross NPE ratio down 34bps to 10.6% with solid coverage ratio at 56.5% CoR across divisions in 3Q17: % +6.0% % 2,621 1,833 i. CBK Italy down to 61bps ii. 0bps in CBK Germany below normalised level, driven by write-backs iii. 12bps in CBK Austria after 1H17 net write-backs iv. In CEE 106bps (+53bps Q/Q, +5bps Y/Y), back at normalised levels, after write-backs in 2Q17 Cost of risk Cov. ratio gross NPE 3Q16 2Q17 3Q17 +85bps +50bps +53bps 52.2% 56.3% 56.5% 9M16 +77bps 9M17 +54bps v. CIB's CoR at normalised levels of 20bps Gross NPE ratio 15.2% 11.0% 10.6% Starting from 31 December 2016 the credit exposures belonging to the so-called FINO Portfolio were recognised in the item Non-current assets and disposal groups classified as held for sale. Following the FINO portfolio disposal occurred in July 2017 and the application of the IAS 39 principle, the credit exposures related to such a portfolio have been derecognised for accounting purposes from the balance sheet assets. Group asset quality ratios calculated, on a pro forma basis, including the underlying credit positions of the whole FINO portfolio as at 30 September 2017 are the following: gross NPE ratio of 13.5% (13.9%in 2Q17); net NPE ratio of 5.3% (5.5% in 2Q17); NPE coverage ratio of 64.3% (64.0%in 2Q17); gross bad loans ratio of 9.1% (9.3% in 2Q17); net bad loans ratio of 2.6% (2.6% in 2Q17); bad loans coverage ratio of 74.4% (74.4% in 2Q17)

17 Agenda UniCredit at a glance Transform 2019 update 3Q17 P&L results 4 Asset quality Capital position Funding & Liquidity 7 Concluding remarks 17

18 Non Core Run down progressing Non Core evolution, bn Actions of Non Core run down (1), bn Asset quality M17 by 2019 Gross loans o/w gross NPE Net loans FINO "Back" to Core Gross loans FINO Phase 1 successfully closed in July, Phase 2 portfolio expected to be sold down below 20% by year end Mainly driven by mortgages and Corporate executed (2) Repayments Mainly driven by Corporate, Small business, Real estate and Mortgages (3) M2016 Adj 9M (incl. one-off LLP) NPE coverage ratio 68.2% 57.1% >57% Disposals Recoveries 2.2bn since October 2016 Cash recoveries on workout and on UTP (to 5% recovery in 2019) (4) (5) UTP coverage ratio 42.8% 45.1% >38% Bad loans cov ratio 77.1% 64.2% >63% Write-offs Active portfolio management and cost optimization 1. Starting from 31 December 2016 the credit exposures belonging to the so-called FINO Portfolio were recognised in the item Non-current assets and disposal groups classified as held for sale. Following the FINO portfolio disposal occurred in July 2017 and the application of the IAS 39 principle, the credit exposures related to such a portfolio have been derecognised for accounting purposes from the balance sheet assets. Managerial figures 2 o/w 1.0bn in 2Q17 and 0.3bn in 3Q17 3. o/w 0.1bn in 1Q17 and 0.1bn in 3Q17 4. o/w 0.1bn in 1Q17, 0.9bn in 2Q17 and 0.2bn in 3Q17. In 4Q16 additional 1.0bn 5. o/w 0.3bn in 1Q17, 0.3bn in 2Q17 and 0.3bn in 3Q17 6. o/w 0.2bn in 1Q17, 0.3bn in 2Q17 and 0.5bn in 3Q (6) - 4.8

19 Group Asset quality further improved in the quarter with lower NPE, improved NPE ratios and strengthened coverage ratios Non performing exposures, bn o.w. Gross bad loans, bn -43.1% Asset quality % -41.3% % Net bad loans Sep Sep < Net NPE 35.8 Sep Sep Coverage ratio 61.4% 66.2% >63% o.w. Gross unlikely to pay, bn Gross NPE ratio 15.1% 10.6% 8.4% -9.7% -37.8% 19 Net NPE ratio Coverage ratio 7.9% 5.0% 4.0% 52.2% 56.5% >54% Net UTP <8.7 Sep-16 Sep Coverage ratio 34.0% 44.0% >38%

20 Agenda UniCredit at a glance Transform 2019 update 3Q17 P&L results Asset quality 5 Capital position Funding & Liquidity 7 Concluding remarks 20

21 Group Transitional ratios well above MDA levels Capital position Transitional CET1 ratio Transitional Tier 1 ratio Transitional total capital ratio MDA as of MDA as of MDA as of +0.9pp 12.93% +1.0pp 13.94% 14.31% +1.0pp 15.32% AT1 1.38% AT1 0.94% AT1 0.94% 17.25% 18.19% T2 2.87% AT1 1.38% CET % CET % CET % CET % Jun-17 Sep-17 Jun-17 Sep-17 Jun-17 Sep bn 49 bn 50 bn 54 bn 61 bn 64 bn Absolute amount for transitional CET1 capital, Tier1 capital and total capital 21

22 Solid FL CET1 ratio at 13.81% up by 101bp Q/Q mainly thanks to Pioneer disposal, earnings generation and RWA dynamics. Target leverage ratio at 5.6% in Fully loaded CET1 capital (1) as of Sep-17, bn Capital position /bn Peer1 Peer2 Peer3 Peer4 Peer5 Peer6 Peer7 UCG Peer8 Peer9 Peer10 Peer11 Total capital (2) Total assets , , ,521 1,468 2,159 2,138 Fully loaded Basel 3 Leverage ratio (3) as of Sep-17, % Peers Avg. 4.92% Peer1 Peer2 Peer3 Peer4 Peer5 Peer6 Peer7 Peer8 UCG UCG 2019 Peer9 Peer10 Peer CET1 FL calculated as FL CET1 Ratio * RWA 2. Total capital FL where available 3. Leverage ratio FL where available Note: Peers: BBVA, BNP, Commerzbank, CASA, DB, HSBC, ISP, ING Bank, Nordea, SAN, SG

23 Agenda UniCredit at a glance Transform 2019 update 3Q17 P&L results Asset quality Capital position 6 Funding & Liquidity 7 Concluding remarks 23

24 Well diversified and centrally coordinated funding and liquidity profile Funding & Liquidity UniCredit SpA is operating as the Group Holding as well as the Italian operating bank: TLAC issuer assuming Single-Point-of-Entry (SPE) Coordinated Group-wide funding and liquidity management to optimize market access and funding costs Diversified by geography and funding sources Western Europe CEE Banks (11 CEE countries (1) ) Local funding and self-sufficiency principle is part of overall Group funding plan while leveraging on local knowledge (well established issuance platform in Germany e.g. Covered Bond/Pfandbriefe) Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Hungary, Romania, Russia, Slovakia, Slovenia, Serbia and Turkey

25 Strong and disciplined Liquidity Management Funding & Liquidity 3Q17 strong liquidity buffer bn Additional eligible assets available within 12 months (1) Cash and Deposits with Central Banks Compliant with key liquidity ratios LCR NSFR >100% >100% Unencumbered assets (immediately available) bn liquid assets immediately available, well above 100% of wholesale funding maturing in 1 year UniCredit S.p.A. LCR and NSFR >100% Unencumbered assets are represented by all the assets immediately available to be used with Central Banks. Additional eligible assets (available within 12 months) consist of all the other assets eligible within 1 year time

26 Group Funding Plan Funding & Liquidity Group Funding Plan Strategy bn, to be issued over plan period TLAC funding plan (ex. AT1) AT1 Other senior bonds Covered Supranational Other wholesale M/L term Total funding plan by Product (2) by Country Italy Germany Austria CEE (1) 78.7bn 42.8% 33.6% 4.0% 19.6% Very conservative funding plan given the current regulatory uncertainty to mitigate any execution risk Group ML Term funding plan envisages cumulated bond issuances of c. 79 bn with a carefully selected array of debt and capital instruments The funding plan has been put in place to ensure that TLAC and MREL requirements are respected over the next three years The set-up of a $30 bn 144a / RegS Global MTN combined Program will allow the bank to further diversify its funding sources and tap investors globally 50% of planned AT1 issuances already executed Including Turkey at 100% bn AT1 planned of which 500 m AT1 already executed in December 2016

27 2017 Medium-Long Term Funding Plan (1/2) Funding & Liquidity 2017 M/L Term Funding Plan by region 26.9bn TLTROII split by region Italy 49.8% 19.7bn Germany 24.6% Austria CEE 7.8% 1.9% Italy 32.9% Germany Austria CEE (1) 28.2% 3.5% 18.5% Germany Austria CEE (1) 37.2% 0.6% 29.3% 65.7% Italy 2017 (Planned) 2017 (Realized) (2) As of end of October, c. 73% or c bn of the 2017 Group Funding Plan is executed Taking also advantage of the last additional TLTROII take-up of c bn during the recent auction in Mar-17, the Group is leveraging on 51.2 bn of TLTROII Including Turkey at 100% 2. As of 3 rd of November 2017

28 2017 Medium-Long Term Funding Plan (2/2) Funding & Liquidity As of end of October, UniCredit issued c bn of bond instruments, which represent c. 73% of the overall 2017 funding plan. These are the latest landmark issuances: $1.25 bn 5Y 3.750% and $0.75 bn 10Y 4.625% Senior Unsecured Dual-tranche 1.25 bn PerpNC % Additional Tier 1 $1.0 bn Tier 2 Subordinated 15NC % Notes Senior Non-Preferred legislation has been included in the draft version of the Stability Law and it is expected to be approved by year end. The Funding Plan will be updated on December 12 th during the Capital Market Day event 28

29 Ratings Overview Funding & Liquidity SpA BBB/Stable/A2 (1) Baa1/Stable/P2 (1) BBB/Stable/F2 (1) (bbb) (2) (ba1) (2) (bbb) (2) UC SpA upgraded: capital strengthening contributed to our upgrade. UniCredit will be able to achieve its business plan target to reduce the gross NPE stock"...very large capital raising coupled with a reduction in problem loans and increased provisioning coverage places the bank in a better position to meet the challenges of an adverse operating environment in Italy... the planned recapitalisation, sale of nonperforming loans and cost-cutting measures, if achieved, are all positive for creditors Issuance Ratings Issuance Ratings Issuance Ratings UC SpA T2 AT1 OBGI (Ital CB) (5) OBGII (Ital CB) (6) BB+ nr A+ nr UC SpA T2 AT1 OBGI (Ital CB) (5) OBGII (Ital CB) (6) Ba1 nr Aa2 Aa2 UC SpA T2 AT1 OBGI (Ital CB) (5) OBGII (Ital CB) (6) BBB- B+ AA nr 29 Italy BBB/Stable/A2 (1) Baa2/Negative/P2 (1) BBB/Stable/F2 (1) BBB+/Develop (3) /A2 (1) A2 (4) /Stable/P1 (1) BBB+/Negative/F2 (1) (bbb+) (2) (baa2) (2) (bbb+) (2) BBB/Positive/A2 (1) Baa1/Stable/P2 (1) BBB+/Negative/F2 (1) (bbb) (2) (baa3) (2) (bbb+) (2) 1. Order: Long-Term Senior Unsecured Debt Rating / Outlook or Watch-Review / Short-Term Rating / Stable = Stable Outlook 2. Stand-Alone Rating 3. Outlook "developing" due to (i) uncertainties around resolution process and (ii) related questions about sustainability of ALAC (Additional Loss-Absorbing Capacity) buffer 4. Deposit rating shown, while Senior Debt at 'Baa2/Stable/P1' 5. Soft Bullet 6. Conditional Pass Through

30 Agenda UniCredit at a glance Transform 2019 update 3Q17 P&L results Asset quality Capital position Funding & Liquidity 7 Concluding remarks 30

31 Concluding remarks Transform 2019 delivering tangible results Concluding remarks Underlying financial performance is strong. Adjusted RoTE (1) reached 7.8% in 9M17, on track to meet the 9% target for FY19 FY17 NII target of 10.2bn is confirmed. NII is expected to remain stable in 1H18 while increasing in 2H18, thanks to the combined effect of higher volumes and stabilising customer rates Transform 2019 is ahead of plan and delivering tangible results. We expect total costs to be marginally lower than the FY bn target. FY bn cost target is confirmed Continued de-risking in 3Q17 with gross NPE ratio down to 10.6% and low CoR of 53bps. FY17 CoR estimated to be between 55 and 60bps. FY19 CoR target of 49bps is confirmed High CET1 ratio at 13.81%. Expected negative CET1 ratio impact of model changes and procyclicality in 4Q17 of 30 to 40bps and of IFRS9 first time adoption on 1 January 2018 of 38 to 42bps Adjusted RoTE excluding the net impact from the Pekao (-310m FX reserve 2Q17) and Pioneer (+2.1bn 3Q17) disposals and a one-off charge booked in Non Core (-80m in 3Q17) related to FINO. All costs and charges pertaining to the FINO transaction have been accounted for, including a one-off charge of 80m booked in Non Core in 3Q17 as included in the disclosure on 24 October 2017 of 3Q preliminary results. RoTE calculated at CMD perimeter, considering also the capital increase and Pekao & Pioneer disposals as at 1 January 2017