THE BANCA CARIGE GROUP

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2 THE BANCA CARIGE GROUP Fondazione CR Genova e Imperia CE Participations - Groupe BPCE Generali Assicurazioni Other shareholders 44.06% 14.98% 2.97% (*) 37.99% Banca Carige S.p.A. - Cassa di Risparmio di Genova e Imperia Banca Carige Group 78.75% Banca Cesare Ponti S.p.A % Cassa di Risparmio di Carrara S.p.A % Banca del Monte di Lucca S.p.A % Cassa di Risparmio di Savona S.p.A % 76.95% Centro Fiduciario C.F. S.p.A % Argo Finance One S.r.l % Priamar Finance S.r.l % Argo Mortgage S.r.l % Argo Mortgage 2 S.r.l % Carige Covered Bond S.r.l % Carige Assicurazioni S.p.A. 1.16% held through own shares % Carige Vita Nuova S.p.A. 0.50% 99.50% Carige Asset Management SGR S.p.A % Creditis Servizi Finanziari S.p.A % Galeazzo S.r.l. 0.01% 99.99% Columbus Carige Immobiliare S.p.A % Immobiliare Ettore Vernazza S.p.A. 10% held through own shares % Immobiliare Carisa S.r.l % Dafne Immobiliare S.r.l % I.H. Roma S.r.l % 57.50% Assi90 S.r.l. Banking activities Trustee activities Insurance activities Instrumental activities Financial activities Insurance agents (*) As per the Notification to Consob of 6 October

3 BANCA CARIGE GROUP INTERIM REPORT ON OPERATIONS AS AT 30 SEPTEMBER 2009 CONTENTS CONSOLIDATED FINANCIAL HIGHLIGHTS 5 MANAGEMENT OF THE PARENT BANK 6 INTERIM REPORT ON OPERATIONS 7 - The real and monetary situation 8 - Strategy 9 - Business performance 10 - Significant events of the first nine months 11 - Risk management 13 - Major events that occurred after 30 September 2009 and business outlook 13 - Information on relations with related parties 14 CONSOLIDATED INTERIM FINANCIAL STATEMENTS 15 Consolidated financial statements 16 - Consolidated balance sheet 17 - Consolidated income statement 18 - Statement of consolidated comprehensive income 19 - Statement of changes in consolidated shareholders equity 20 - Consolidated cash flow statement 23 Explanatory notes 24 - Accounting policies 25 - Area and methods of consolidation 26 - Net income from intermediation activities 29 - Economic results 46 - Dividends distributed by the Parent Bank Banca Carige 51 - Insurance activities 52 - Transactions with related parties 53 - Equity investments 54 - Own shares, cash flow statement and shareholders equity 54 - Resource management 55 - Results by economic business sector 57 - Risk management 63 - The Parent Bank 69 - Bank subsidiaries 69 - Insurance subsidiaries 74 - Financial subsidiaries 76 - The other main subsidiaries 78 INTERIM FINANCIAL STATEMENTS OF THE PARENT BANK 79 Financial highlights 80 Financial statements of the Parent Bank 81 - Balance Sheet 82 - Income statement 83 - Statement of comprehensive income 84 - Statement of changes in shareholders equity 85 - Cash flow statement 88 Explanatory notes 89 - Accounting policies 90 3

4 - Net income from intermediation activities 91 - Economic results Transactions with related parties Results by economic business sector Shareholders' equity 108 DECLARATION OF THE MANAGER RESPONSIBLE FOR PREPARING THE COMPANY S FINANCIAL REPORTS PURSUANT TO PARAGRAPH 2 OF ART. 154-BIS OF THE CONSOLIDATED LAW ON FINANCE REPORT OF THE INDEPENDENT AUDITORS ON THE LIMITED AUDIT OF THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS REPORT OF THE INDEPENDENT AUDITORS ON THE LIMITED AUDIT OF THE INTERIM FINANCIAL STATEMENTS OF THE PARENT BANK REMARKS The following signs are used by convention in the tables: - when the data are nought when data are not significant 4

5 CONSOLIDATED FINANCIAL HIGHLIGHTS BALANCE SHEET (1) Situation as at Change % 30/9/ /6/ /12/ /9/2008 9/09 9/09 12/08 9/08 Total assets 34,408,666 33,711,301 31,986,445 30,328, Funding 24,588,373 24,237,075 22,965,533 21,562, Direct Deposits (a) 23,485,846 23,711,470 22,164,080 20,475, * Amounts owed to customers 14,042,180 13,412,317 12,005,439 10,766, * Securities in issue 8,829,550 9,685,828 9,578,795 9,142, * Liabilities at fair value (2) 614, , , , Amounts owed to banks 1,102, , ,453 1,086, Indirect deposits (b) 21,132,629 20,919,953 20,960,268 21,905, Assets under management 11,497,235 10,942,776 10,438,552 10,947, Assets in custody 9,635,394 9,977,177 10,521,716 10,957, Financial Intermediation Activities (FIA) (a+b) 44,618,475 44,631,423 43,124,348 42,381, Investments 30,257,478 29,300,415 27,450,047 26,251, Loans to customers (3) 21,924,619 21,854,345 21,119,889 19,558, Loans to banks (3) 654, , ,953 1,258, Securities portfolio 7,678,834 6,614,025 5,343,205 5,434, Capital and reserves 3,604,929 3,514,342 3,336,250 3,487, Situation as at Change % 30/9/ /6/ /12/ /9/2008 9/09 9/09 12/08 9/08 INCOME STATEMENT (1) Gross operating income 804, ,699 1,030, , Net income from financial and insurance management 714, , , , Operating income from ordinary activities before taxes 251, , , , Profit for the period 163, , , , RESOURCES (4) Number of branches Insurance agencies Number of bank employees 5,492 5,496 5,523 5, Number of bank and insurance employees 5,881 5,888 5,906 5, FINANCIAL RATIOS Operating costs Gross operating income 58.51% 59.22% 58.94% 56.08% Operating profit from ordinary activities before taxes /Capital and reserves 6.96% 4.79% 9.25% 6.74% ROE 4.53% 3.18% 6.16% 4.68% ROE (5) 5.70% 4.03% 7.65% 5.75% ROAE (6) 4.71% 3.26% 6.90% 5.34% ROAE (5) (6) 5.88% 4.09% 8.79% 6.75% Earnings per share (in euro) - basic diluted RISK ASSETS AND REGULATORY RATIOS (7) Total Risk-Weighted Assets (1) 19,948,910 19,537,608 19,096,988 18,315, Core Tier 1/Total Risk-Weighted Assets 6.90% 7.04% 7.08% 8.17% Tier 1 capital / RWA (7) 7.70% 7.86% 7.91% 8.17% Regulatory capital/total weighted assets (7) 10.04% 10.23% 10.56% 10.10% (1) Figures in thousands of euro (2) Carige Vita Nuova liabilities, designated at fair value and relating to products for which investment risk is borne by the insured, are not included in this table. (3) Gross of value adjustments and net of debt securities classified as L&R. (4) Statistics of the end of period. (5) Net of the AFS reserve established against the revaluation of the equity investment in the Bank of Italy. (6) Net profit on average shareholders' equity (Return On Average Equity). (7) Figures relating to the regulatory capital and the capital requirements as at 30/06/2009 are the official figures and therefore they differ from the management data shown in the half-year report. Figures regarding the regulatory capital and the capital requirements as at 30/9/2009 and 30/9/2008 result from accounting and management estimates, as the official consolidated figures (Information form "1") are provided only in June and December. Capital ratios have been calculated based on supervisory regulations in force from time to time. 5

6 MANAGEMENT OF THE PARENT BANK BOARD OF GENERAL MANAGEMENT BOARD OF STATUTORY DIRECTORS AUDITORS CHAIRMAN GENERAL MANAGER CHAIRMAN Giovanni Berneschi* Alfredo Sanguinetto Andrea Traverso DEPUTY CHAIRMAN DEPUTY GENERAL STANDING AUDITORS Alessandro Scajola * MANAGER Massimo Scotton (COMMERCIAL) Antonio Semeria DIRECTORS Carlo Arzani (1) Piergiorgio Alberti * SUBSTITUTE AUDITORS Piero Guido Alpa DEPUTY GENERAL Adriano Lunardi Jean-Jacques Bonnaud MANAGER Luigi Sardano Luca Bonsignore (ADMINISTRATION AND Cesare Castelbarco Albani RESOURCES) AUDIT FIRM Remo Angelo Checconi * Giacomo Ottonello Deloitte & Touche SpA Bruno Cordazzo Gabriele Galateri di Genola DEPUTY GENERAL Luigi Gastaldi * MANAGER Pietro Isnardi Alain Jean Pierre Lemaire (CREDIT AND WEALTH MANAGEMENT) Paolo Cesare Odone * Mario Cavanna Renata Oliveri * Jean-Marie Paintendre * DEPUTY GENERAL Guido Pescione Mario Venturino (GOVERNANCE AND CONTROL) Ennio La Monica *Member of the Executive Committee The Board of Directors was appointed by the Ordinary Shareholders Meeting of 29 April 2009 for the financial years The Executive Committee was appointed by the Board of Directors on 11 May 2009 with term of office up to 31 October The Board of Statutory Auditors was appointed by the Ordinary Shareholders Meeting of 29 April 2008 for the financial years The mandate to the Audit Firm was granted by the Ordinary Shareholders Meeting of 20 April 2006 for the financial years On 11 May 2009, in compliance with the provisions of art. 154 bis, paragraph 1 of Legislative Decree 58/1998 and art. 31 of the Articles of Association, the Board of Directors resolved the appointment, effective from 12 May 2009, of Daria Bagnasco, the Director responsible for Group Planning and Financial Statements, as the Officer in charge of preparing the company s accounting documents, having verified the requirements of integrity and experience. (1) With the role of Substitute Deputy General Manager. 6

7 INTERIM REPORT ON OPERATIONS 7

8 THE REAL AND MONETARY SITUATION During the third quarter of the year the analysis of the macro economic variables and the consumer and business expectations showed signs of improvement in the economic situation, driven above all by the exceptional economic policy measures put in place in all the industrialised countries to combat the crisis, which has now been underway for two years. The prices of raw materials and oil are on the increase and the stabilisation of property values is being accompanied by an, albeit modest, rise in the demand for homes. Also, despite still being highly volatile, stock markets are recovering and the spreads between interbank and free risk rates have returned towards precrisis levels. Problem situations still remain, however, especially in the credit and labour market, as reflected respectively by the increase in the bad loans/lending ratio and the rise in the unemployment rate. Global GDP for 2009 is in any case expected to fall with a downturn in international trade of around 12.5%, which will largely drive the contraction in the economy. In the United States the weakness of domestic demand led to a 3.8% fall in GDP as at June. Net real exports provided a greater contribution than expected, mainly as a result of the fall in imports. Household expenditure, despite recovering from June onwards, fell sharply on an annual basis. A major contributing factor was the deterioration of the labour market: between December 2007 and August 2009 the number of people in employment fell by 7 million and the unemployment rate in September stood at 9.8%. Positive signs emerged from the property market, which recorded a 3.6% increase in average prices between April and July, as well as growth in residential construction permits. Industrial production increased between July and August, signalling a reversal of the falling trend seen at the end of The inflation rate, which has been negative since January, is expected to decrease by an average of 0.3% for As regards the emerging countries, Brazil in particular is suffering from restriction in credit in the international markets, which its exporting companies depend on, and the repatriation of capital by the foreign businesses based in the country. Russia recorded a sharp downturn due to the effects on production of the problems of the financial system and low oil prices. China and India, on the other hand, benefited from the favourable structural situation and the expansive monetary policies. In China in particular GDP continued to grow at rates of over 8%, with a sharp increase in investments, sustained by a program of public-sector interventions. Industrial production was up by 11% on the year, whilst foreign trade was still down. The EU economy performed worse than the United States, primarily due to the contraction in investments and exports. In June GDP fell by 4.8%, a slowdown in the decline thanks to the economic growth in France and Germany, essentially attributable to the fiscal incentives aimed at sustaining domestic demand. In August industrial production revealed a downward trend of 15.3%, despite having increased by 1% on the previous month, whilst retail sales recorded an annual fall of 2.4% (-0.3% on the previous month). The unemployment rate fell by 9.6% (3.2 million more unemployed in twelve months) with the highest level in Spain and the lowest in Germany. There were encouraging signs in the form of the business and consumer confidence indexes, both of which improved. Consumer prices recorded an annual fall as at September of 0.3% (-0.4% in France and -0.5% in Germany) continuing the deflationary trend seen in the previous months. However, core inflation (net of energy and non-processed foods) increased by 1.1%. Italy also saw a reduction in production albeit at a slower rate thanks to the expansive fiscal and monetary policies. In order to help businesses in difficulty, the Ministry of Economy and Finance, the ABI (Italian Banking Association) and Business Associations signed an agreement at the beginning of August for the suspension of debts owed by small and medium sized enterprises to the credit system, with the aim of providing financial breathing space to companies with adequate financial prospects, capable of demonstrating their going concern status (moratorium on loans). Estimated GDP for the first half of 2009 showed a fall of 6% compared with the same period in The low level of use of facilities and the structural excess in the supply of real estate penalised investments, whereas household expenditure, despite suffering from the deterioration in the labour market, withstood the impact of the crisis better, thanks to the fall in oil prices, the lower level of household debt, the social welfare measures and the scrapping 8

9 incentives. The unemployment rate rose to 7.4% in the second quarter of 2009, an increase of 6.7% compared with the same quarter of 2008 and stable compared with the previous quarter. Industrial production fell by 21% during the first eight months of 2009 compared with the same period in 2008, with capital and intermediate goods performing the worst. Inflation, after having reached a minimum in July, returned to moderate growth, albeit at low levels. The decrease in the consumer prices index from 3.9% in September 2008 to 0.4% in September 2009 and the low interest rates softened the negative impact of the crisis on household income, but did not stop the contraction in consumption: retail sales for the first five months of 2009 slackened by 2.2% compared with the same period in 2008, with the large-scale retail trade (-0.5%) and the food sector (-1.8%) holding up better than small businesses (-3.3%) and the non-food sector (-2.3%). Over the same period foreign trade showed a fall of 23.8% in exports and 25.4% in imports, with a negative trade balance of euro 1.4 billion, due entirely to non-eu countries. Indeed, EU countries showed a surplus of euro 1.8 billion. Public finance worsened: the public sector cash requirements for the first nine months of 2009 amounted to euro 72.6 billion, an increase of around euro 33 billion on the first nine months of 2008 partly due to a reduction in revenue from direct taxes (-2.9% on an annual basis in the period January-July). For the current year the deficit/gdp ratio is forecasted to increase to 115.1% and the net debt as a percentage of GDP is expected to rise to 5.3%. Monetary policy continued to follow the objective of creating favourable credit conditions, by keeping reference rates low. In the United States, the FED kept the policy interest rate at the minimum levels reached last December (range of 0 to 0.25%). The ECB, in its Governing Council meeting of 8 October 2009, left the reference rate unchanged at 1%, the lowest level since the introduction of the single currency, after having reduced it by 1.5 percentage points in four successive rate changes in the first half of Money market rates showed a decreasing trend: the 3-month Euribor rate fell by around 2.5 percentage points, from 3.38% in December to 0.75% in September and the 6-month Euribor fell from 3.45% to 1.02%. The rates of Government securities recorded a considerable drop: returns on 6-month BOTs (treasury bills) in particular fell from 1.91% in December to 0.55% in September. The Rendistato (yield on Government securities) showed a more moderate decrease, from 4.13% to 3.31%. On the exchange rate market the Euro appreciated against the dollar, with an average monthly rate in September of (1.397 at the end of 2008). In the same month, the UK sterling/euro rate averaged 0.892, whereas the average exchange rates against the Swiss franc and the Japanese yen stood at and respectively. With regard to banking intermediation, direct deposits settled at steady figures (+9.9% as at September), with constant growth in deposits (+6.7%; +7.6% as at December 2008), against a slowdown in bonds (+14.8%; +20.4% as at December) and a fall in repurchase agreements (almost -40% as at August) and foreign deposits (-14% as at August). Lending, shaped by the difficult economic situation, showed a significant slowdown (+1.4% on a trend basis as at September 2009; +4.9% as at December 2008), with a slightly better trend in loans to households and nonfinancial companies (+1.5%). In terms of maturities, short-term loans fell by 1.7% whereas medium/long-term loans grew by 2.8%. Net bad loans continued to rise, with a bad loans/loans ratio of 1.67% compared with 1.24% in December. Bank interest rates continued to fall. The average rate on loans to households and nonfinancial companies as at September stood at 3.93% (6.09% at the end of 2008) and the rate on deposits at 0.83% (1.99% as at December 2008), with a further reduction in spreads. STRATEGY The strategic goal of the Group, in line with the path started at the beginning of the 1990s, is the creation of value for all stakeholders in the medium/long-term, with a particular focus on the development of relations with customers and balancing dimensional growth, key requirements for maintaining a significant role in the domestic banking system. The Carige Group confirmed the mission of consolidating its position as a banking, financial and welfare and insurance group at national level: - with a widespread presence in Italy, significant coverage in certain areas of the 9

10 country and the core centre in Liguria, where it is characterised by a particular focus on the development of relations with local entities (multilocalism), - focused on the family, small and medium sized enterprise, craftsmen, merchant segments and local public entities, - able to distinguish itself for the quality of service offered through an integrated multichannel approach and a progressive qualitative development of resources and structures, also leveraging on the widest use of technology. In line with the strategic goal and in order to fully realise this mission, strategies have been developed for: an increased level of productivity, efficiency and profitability; a growth in traded volumes, maintaining an adequate level of capitalisation; risk protection and management. The strategy pursued by the Group and the results achieved were assessed favourably in the period by international rating agencies. The most recent ratings attributed to the Group are shown in the table below: BANCA CARIGE RATINGS Date short-term long-term BFSR (1) (2) Individual (2) Support (3) Fitch December 2008 F1 A - B/C 3 Moody's October 2008 (4) P-1 A2 C- - - Standard & Poor's March 2009 A2 A (1) Bank Financial Strength Ratings. (2) BFS ratings express the intrinsic strength and solidity of a bank, as well as its financial reliability given the bank's assets. Ratings range from A to E. (3) Support ratings indicate the likelihood of the Government or other public entity, or shareholders, stepping in to support the bank in the event of crisis. Ratings range from 1 to 5. (4) Date relative to the last credit opinion issued by the rating agency. BUSINESS PERFORMANCE Despite a recessionary macroeconomic scenario, with sharp drops in reference rates and subsequent compression of banking activity spreads, in the first nine months of 2009 the Carige Group maintained a significant level of profitability, recording growth in pre-tax profits of 6.7% and a 0.2% increase in net profits compared with the first nine months of During the period, thanks also to the contribution from business units acquired in 2008 from the Intesa Sanpaolo Group (79 branches) and Unicredit Group (40 branches), the positive trend in traditional trading continued, characterised by growth in direct deposits (+14.7% year on year)- sustained in particular through current accounts and deposits (+39.9% year on year) - which made it possible to maintain a significant degree of liquidity and to finance the growth in loans (+12.1%) which showed an increase, especially in medium/longterm loans to companies. There was also a steady placement of bancassurance products (+30.5%). In light of the above, together with the overall result of financing (euro 35.8 million, compared with euro million as at 30 September 2008), this made it possible to counteract the negative effects of the spread shrinkage and increase gross operating income (+5.7%). The Group also maintained capitalisation levels, as at the end of the first nine months, significantly higher than the levels required by the supervisory legislation: the estimate of the consolidated capital ratios calculated on the basis of the standard Basel 2 method, showed a Core Tier 1 Ratio of 6.90%, a Tier 1 Ratio (T1R) of 7.70% and a Total Capital Ratio (TCR) of 10.04% compared with the regulatory minimums for T1R and TCR of 4% and 8% respectively. In the Liguria network loans to customers, at euro 9,361 million, increased by 16.5% on an annual basis; amounts owed to customers stood at euro 6,770 million (+26.6%), securities in issue and financial liabilities designated at fair value amounted to euro 4,313 million (+1.6%) and FIA (financial intermediation activities) totalled euro 22,278 million (+2%); gross operating income, at euro million, increased by 2.6%; net of value adjustments income from financial operations reached euro 10

11 333.9 million and operating costs decreased by 1.7% to euro million. In the network outside Liguria loans to customers stood at euro 10,374 million (+10.6%), amounts owed to customers totalled euro 6,081 million (+18%), securities in issue amounted to euro 2,197 million (+11.3%) and FIA (financial intermediation activities) totalled euro 15,844 million (+6.8%); the gross operating income stood at euro million (+12.5%), income from financial operations reached euro million (+8.9%) and operating costs increased by 15.5% to euro million. Shifting our attention to customer segments, the gross operating income increased considerably in the Corporate segment (+17% compared with the first nine months of 2008), against more contained growth in the Private/Affluent and Retail segments, given that the profitability of direct deposits, especially of amounts owed to customers, felt the effects of the reduction in spreads even though volumes increased. With regard to net income from financial and insurance operations, the Corporate segment recorded income of euro million (+8.5%), the Retail segment euro million, essentially stable with respect to September 2008, and the Private/Affluent segment euro million (+6.4%). As regards operating costs, they increased by 2% in the Private/Affluent segment, by 2.2% in the Corporate segment and by 11.5%. in the Retail segment. SIGNIFICANT EVENTS OF THE FIRST NINE MONTHS On 23 January, having received authorisation from the Bank of Italy, the Parent Bank subscribed: - the increase in the share capital of subsidiary Carige Assicurazioni from euro million to euro million, resolved by the Extraordinary Shareholders Meeting of 15 July 2008, for a total value of euro 30 million, including share premium; - the increase in the share capital of Carige Vita Nuova from euro 61.4 million to euro 84.8 million, resolved by the Extraordinary Shareholders Meeting of 15 July 2008, for a total value of euro 45 million, including share premium. On 26 January, Banca Carige s Board of Directors - as part of the review of its international presence - resolved the closure of the Representative Office in London and Mandate Offices in Peking and Moscow. On 4 February, with regard to the appeal submitted by Banca Carige against the monetary administrative sanction of euro 420 thousand imposed on 7 August 2008 by the AntiTrust Authority (on the grounds of an unfair commercial practice, pursuant to Legislative Decree 206/2005, in relation to the so-called mortgage portability ), the Regional Administrative Court of Lazio issued a provision under which it accepted the appeal and partly overturned the decision of the AntiTrust Authority; in September the Authority filed an appeal against this provision with the Council of State. On 23 February, the Parent Bank s Board of Directors resolved favourably regarding measures to strengthen the shareholders equity of the subsidiary Banca del Monte di Lucca, in addition to the charging to capital of valuation reserves for this Bank and for Cassa di Risparmio di Savona. Following the authorisation from the Bank of Italy: - the Extraordinary Shareholders Meeting of Banca del Monte di Lucca, held on 17 June 2009, resolved a free increase in share capital, from euro 18.7 million to euro 24 million, registered on 25 June 2009, in addition to a paid increase, from euro 24 million to euro 29.2 million, for a total amount of euro 10 million, including share premium, which shall be subscribed by shareholders by 31 December 2009; - the Extraordinary Shareholders Meeting of Cassa di Risparmio di Savona, held on 25 June 2009, resolved the free increase in share capital, from euro 95.2 million to euro million, through the use of valuation reserves of the same amount, registered on 30 June On 23 March, Carige s Board of Directors - in conformance with Bank of Italy regulation pursuant to Circular 263/2006 which adopted the provisions contained in the New Capital Agreement (so-called Basel 2) - approved The Model for Governance of the Public Information Process - Pillar 3, published on the company website on 30 April. On 6 April, in order to maximise the commercial effectiveness in respect of the Private segment and with a view to the optimisation of 11

12 specialised, highly customer-oriented services, the new Private Banking structure became operational, as part of the Parent Bank s Distribution area. On 29 April Carige s Ordinary Shareholders Meeting approved the document concerning Remuneration Policies and the financial statements for year ended at 31 December 2008, and appointed the new Board of Directors for the three year period The Extraordinary Shareholders Meeting also approved the changes to the articles of association, made to incorporate the recent supervisory regulations on the organisation and corporate governance; similar resolutions relating to changes to the articles of association were adopted by the Shareholders Meetings of the other Group Banks. On 11 May Banca Carige s Board of Directors appointed the elective members of the Executive Committee, joining the Chairman Giovanni Berneschi and the Deputy Chairman Alessandro Scajola, as members by right, with term of office expiring on 31 October At the same meeting, the Board also appointed the following persons as members of the internal Committees: - Internal Audit Committee: Piero Guido Alpa, Jean-Jacques Bonnaud, Cesare Castelbarco Albani, and Bruno Cordazzo; - Remuneration Committee: Piero Guido Alpa, Luca Bonsignore, Cesare Castelbarco Albani, and Pietro Isnardi; - Appointments Committee: Giovanni Berneschi, Piero Guido Alpa, Luca Bonsignore, Cesare Castelbarco Albani, Remo Angelo Checconi, and Gabriele Galateri di Genola. On the same date, the Board appointed the following persons as new members of the Banca Carige Supervisory Body pursuant to Legislative Decree 231/2001: Jean-Jacques Bonnaud, Director, Adalberto Alberici, Maurizio Fazzari, Andrea Baldini and Andrea Garaventa as expert members, plus two Carige Executives that are, from time to time, in charge of Internal Audits and Risk Management. At the same meeting, the Board of Directors, with the prior approval of the Board of Statutory Auditors and having verified the requirements of integrity needed by Board Directors and the possession of a wealth of experience gained in managerial roles in the planning and control sectors as well as in administration, accounting and finance, effective as of 12 May 2009, resolved to appoint Daria Bagnasco, Director responsible for the Planning Structure and Group Financial Statements, as the Officer in charge of preparing the company s accounting documents, pursuant to art. 154 bis of the Consolidated Law on Finance and art. 31 of the Articles of Association. On 15 June, once the statutory and internal regulation structures were approved at the Ordinary and Extraordinary Shareholders Meetings - in light of the Supervisory Provisions regarding the organisation and corporate governance of Banks issued by the Bank of Italy on 4 March the Board of Directors approved the Corporate Governance Plan, which contains the choices and reasons regarding the organisational structures of the Bank and the Group, with special focus on the control system profiles. With regard to the purchase of Banca Nazionale del Lavoro S.p.A. shares in 2005, for which - as detailed in the Report on the Financial Statements for the year ended at 31 December there are ongoing legal proceedings before the Magistrate in charge of preliminary hearings in Milan and Consob has imposed a monetary administrative sanction, while the Public Prosecutor s Office of Rome has recently announced the conclusion of the preliminary investigations. On 6 August, the Bank of Italy issued an authorising provision in relation to the resolution of 8 April 2009 by Banca Carige s Board of Directors, regarding the restructuring of the Group s property segment, to be carried out through: the merger by incorporation of Immobiliare Ettore Vernazza SpA and Galeazzo Srl with Banca Carige, the division of part of the capital of Columbus Carige Immobiliare SpA, represented by assets that are instrumental in the Group s activities, with the assignment to a new company that will later be incorporated into Banca Carige. With regard to the above transaction, on 28 August, the Board approved the final wording of the partial merger and division plans subsequently approved by the Shareholders Meetings of the respective Companies. On 13 August, the Group adhered to the Notice shared by the Ministry of Economy and Finance, the ABI (Italian Banking Association) and Business Associations, for the suspension of debts owed by small and medium sized enterprises to the credit system, the goal of which is to give some financial breathing space 12

13 to companies experiencing difficulties in the current economic climate. On 28 August the Board of Directors resolved to approve the submission to the Extraordinary Shareholders Meeting, subject to the authorisation from the Bank of Italy, of the proposal to grant the Board the power to issue convertible bonds, also in tranches and including subordinated instruments, for a maximum amount of euro 400 million, with consequent share capital increase to service the conversion for a maximum nominal amount of euro 400 million. On 21 September, with respect to the above, the Board granted the Chairman the authority to call a specific Extraordinary Shareholders Meeting. Following on from the resolution adopted previously (27 July) by the Parent Bank s Board of Directors: - On 18 September the Shareholders Meeting of the subsidiary Carige Vita Nuova SpA resolved a share capital increase of euro 80 million, including share premium, to be offered to the Sole Shareholder, specifying that the related subscription, subject to authorisation by the Supervisory Authority, should take place by 31 December On 29 September Carige Vita Nuova completed the purchase of an additional 35% of the share capital of the subsidiary Assi 90 Srl. Also, on 2 and 6 October, Assi 90 Srl sold the minority shareholdings held in several insurance intermediation companies to third parties. On 21 September the Board of Directors, in relation to the Program for the issue of covered bonds for a maximum amount of euro 5 billion, approved the sale to the special purpose vehicle Carige Covered Bond Srl, in accordance with the master sale agreement entered into on 14 November 2008, of further eligible assets for a total amount of around euro 1 billion. RISK MANAGEMENT In the Carige Group, any policies related to the assumption of risks are set by the Board of Directors of the Parent Bank at the moment of the preparation of strategic planning and the annual budget. The Parent Bank performs orientation and supervisory functions as regards all risks, in particular by managing, in an integrated context, the Pillar 1 and Pillar 2 risks, in accordance with the provisions contained in the Supervisory Instructions of the Bank of Italy (Circ. No. 263 dated 27 December 2006 as amended). The Banks of the Group operate within specific limits of independence and avail themselves of their own first level control structures. The risk analyses are supported not only by regulatory models, but by more advanced methodologies which have made it possible, in time, to expand the range of risks monitored and to improve the assessment of the capital adequacy, from both a regulatory and managerial perspective. For details of risk management, please refer to the paragraph Risk management in the Explanatory notes of the Consolidated Interim Financial Statements. MAJOR EVENTS THAT OCCURRED AFTER 30 SEPTEMBER 2009 AND BUSINESS OUTLOOK On 28 October the placement was made in the institutional market with value date 5 November - of the first public issue of Carige covered bonds for an amount of euro 1 billion. The issue, managed by a leading group of international banks, UBS Investment Bank, Natixis, Deutsche Bank, HSBC Group and Unicredit Group, was subscribed by asset management companies (41% of the total), retail banks (26%), central banks (23%) and insurance companies and pensions funds (around 10%). A total of 94% of the subscriptions were made by Italian, German, French, English and Finnish investors. The remaining 6% was split between the other major European countries. 13

14 On 3 November the Extraordinary Shareholders Meeting resolved to grant the Board of Directors the authority to issue convertible bonds (with the option for the Company to make a reimbursement, also in advance, in shares and/or cash) to be offered to the shareholders and the holders of the convertible bonds constituting the loan Banca CARIGE 1.50% hybrid subordinated issue with reimbursement convertible into ordinary shares, for a maximum amount of euro 400 million, and to carry out the consequent share capital increase to service the conversion. This bond issue will enable the Bank, in the current difficult economic climate, to achieve the twin objective of raising funds from the market and maintaining adequate levels of capitalisation, both now and in the future. The funds raised with the covered bonds and the convertible bonds will be used to guarantee further support to businesses and families and to continue the Group s consolidation and growth. In the remaining part of the year the persistence of the crisis and its effects could cause volatility and tensions in the financial markets, a reduction in household income and a stagnation in investments by companies, worsening their creditworthiness. This situation, combined with a contraction in margins and potentially unfavourable changes in credit sector legislation, could impact the Group s economic, financial and equity operations. Despite these factors and subject to events that cannot currently be foreseen the Group believes that it will continue its growth. On 6 November 2009 the merger by incorporation into Carige SpA of Immobiliare Ettore Vernazza SpA and Galeazzo Srl was completed. INFORMATION ON RELATIONS WITH RELATED PARTIES The Group maintains relations with Banca Carige shareholders who are able to exercise a significant influence, subsidiaries and other related parties regulated under market conditions. Please note that in the first nine months, no transactions with related parties subject to information to the public were carried out. The operations carried out in the period fall within the ordinary activities of the Group and do not present the relevance requirements as regards the impact on the financial statements. Asset and liability transactions with related parties are detailed in the Explanatory Notes to the Consolidated Interim Financial Statements. 14

15 CONSOLIDATED INTERIM FINANCIAL STATEMENTS 15

16 CONSOLIDATED FINANCIAL STATEMENTS 16

17 CONSOLIDATED BALANCE SHEET ASSETS (figures in thousands of euro) Change % 9/09 12/08 30/9/09 30/6/09 31/12/08 30/9/ CASH AND CASH EQUIVALENTS 242, , , ,058 (16.3) FINANCIAL ASSETS HELD FOR TRADING 794, , ,294 1,524, (47.9) 30 -FINANCIAL ASSETS DESIGNATED AT FAIR VALUE 676, , , ,644 (5.7) (1.7) 40 -AVAILABLE-FOR-SALE FINANCIAL ASSETS 5,270,371 4,168,194 3,001,637 2,652, FINANCIAL ASSETS HELD TO MATURITY 505, , ,144 99, LOANS TO BANKS 911,014 1,087,803 1,248,818 1,536,157 (27.0) (40.7) 70 -LOANS TO CUSTOMERS 21,644,936 21,603,385 20,916,355 19,311, HEDGING DERIVATIVES 73,831 63,242 56,922 22, EQUITY INVESTMENTS 61,045 58,122 55,067 56, TECHNICAL RESERVES CHARGED ON REINSURERS 179, , , , TANGIBLE ASSETS 1,117,287 1,119,370 1,125,680 1,130,080 (0.7) (1.1) 130 -INTANGIBLE ASSETS 1,709,395 1,705,321 1,701,750 1,582, including: - goodwill 1,639,311 1,639,657 1,639,576 1,524,106 (0.0) TAX ASSETS 270, , , ,496 (31.5) (13.6) a) current 57,814 96, ,347 91,639 (48.5) (36.9) b) advanced 212, , , ,857 (24.7) (4.0) 160 -OTHER ASSETS 951,755 1,111,960 1,137,221 1,032,342 (16.3) (7.8) TOTAL ASSETS 34,408,666 33,711,301 31,986,445 30,328, /09 9/08 LIABILITIES (figures in thousands of euro) Change % 9/09 12/08 30/9/09 30/6/09 31/12/08 30/9/ AMOUNTS OWED TO BANKS: 1,102, , ,453 1,086, AMOUNTS OWED TO CUSTOMERS: 14,042,180 13,412,317 12,005,439 10,766, SECURITIES IN ISSUE 8,829,550 9,685,828 9,578,795 9,142,064 (7.8) (3.4) 40 -FINANCIAL LIABILITIES FROM TRADING 98, , ,470 77,683 (13.9) FINANCIAL LIABILITIES DESIGNATED AT FAIR VALUE 1,299,552 1,292,229 1,305,183 1,270,743 (0.4) HEDGING DERIVATIVES 233, , ,290 25, TAX LIABILITIES 266, , , , (13.4) (a) current 48,762 54,320 37,882 81, (39.9) (b) deferred 217, , , , (4.0) 100 -OTHER LIABILITIES 1,220,187 1,308,897 1,459,158 1,351,101 (16.4) (9.7) 110 -STAFF TERMINATION INDEMNITY 99,003 99, ,233 96,835 (3.2) PROVISIONS FOR RISKS AND CHARGES: 371, , , ,735 (5.0) 1.2 a) pensions and similar obligations 312, , , ,248 (3.1) (3.1) b) other provisions 58,871 48,582 68,190 44,487 (13.7) TECHNICAL RESERVES 3,047,281 2,804,509 2,292,606 2,139, VALUATION RESERVES 568, , , , CAPITAL INSTRUMENTS 1,178 1,178 1,179 1,264 (0.1) (6.8) 170 -RESERVES 232, , , , ADDITIONAL PAID-IN CAPITAL 1,012,742 1,013,034 1,013,259 1,013,376 (0.1) (0.1) 190 -CAPITAL 1,790,300 1,790,300 1,790,299 1,789, MINORITY INTERESTS (+/-) 30,033 30,451 34,373 46,944 (12.6) (36.0) 220 -PROFIT (LOSS) FOR THE PERIOD (+/-) 163, , , ,048 (20.5) 0.2 TOTAL LIABILITIES 34,408,666 33,711,301 31,986,445 30,328, /09 9/08 17

18 CONSOLIDATED INCOME STATEMENT INCOME STATEMENT (figures in thousands of euro) Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/ INTEREST INCOME AND SIMILAR REVENUES 895, ,249 1,491,426 1,087,723 (17.6) 20 -INTEREST EXPENSES AND SIMILAR CHARGES (341,839) (248,976) (680,717) (500,837) (31.7) 30 -NET INTEREST INCOME 554, , , , COMMISSION INCOME 227, , , , COMMISSION EXPENSES (25,463) (16,941) (38,578) (28,724) (11.4) 60 -NET COMMISSIONS 202, , , , DIVIDENDS AND OTHER SIMILAR REVENUES 10,302 9,825 14,818 12,445 (17.2) 80 -NET INCOME FROM TRADING ACTIVITIES 12,459 4,035 (62,976) (54,924) 90 -NET INCOME FROM HEDGING ACTIVITIES 2,252 2,324 (544) PROFIT (LOSS) ON DISPOSAL OR REPURCHASE OF: 23,961 18,065 15,916 15, a) loans 1,823 1,080 3,902 2,425 (24.8) b) available-for-sale financial assets 6,837 1,577 10,214 10,266 (33.4) d) financial liabilities 15,301 15,408 1,800 3, NET VALUE ADJUSTMENT ON FINANCIAL ASSETS DESIGNATED AT FAIR VALUE -1,063 1,123 (518) 15, GROSS OPERATING INCOME 804, ,699 1,030, , NET VALUE ADJUSTMENTS DUE TO IMPAIRMENT OF: (77,346) (56,133) (102,795) (80,294) -3.7 a) loans (60,139) (39,613) (76,929) (75,336) (20.2) b) available-for-sale financial assets (17,257) (16,651) (28,041) (4,205) d) other financial assets ,175 (753) 140 -NET INCOME FROM FINANCIAL MANAGEMENT 726, , , , NET PREMIUMS 1,135, , , , BALANCE OF OTHER EXPENSES/REVENUES FROM INSURANCE MANAGEMENT (1,146,833) (788,138) (944,181) (648,142) 76.9 NET INCOME FROM FINANCIAL AND INSURANCE MANAGEMENT 714, , , , ADMINISTRATIVE COSTS: (484,546) (333,807) (623,102) (450,142) 7.6 a) staff costs (1) (296,278) (204,404) (375,472) (266,540) 11.2 b) other administrative costs (1) (188,268) (129,403) (247,630) (183,602) NET PROVISIONS FOR RISKS AND CHARGES (3,778) (2,773) (2,245) 3, DEPRECIATION OF TANGIBLE ASSETS (17,560) (11,570) (21,320) (14,904) AMORTIZATION OF INTANGIBLE ASSETS (15,175) (9,607) (17,387) (12,209) OTHER OPERATING EXPENSES AND REVENUES 50,620 31,612 56,577 47, OPERATING COSTS (470,439) (326,145) (607,477) (426,527) PROFIT (LOSS) FROM EQUITY INVESTMENTS 6,495 3,583 5,422 2, PROFIT (LOSS) FROM DISPOSAL OF INVESTMENTS (11) (25) OPERATING PROFIT (LOSS) FROM ORDINARY ACTIVITIES BEFORE TAXES 251, , , , INCOME TAXES FOR THE PERIOD (85,133) (53,895) (95,844) (67,060) PROFIT (LOSS) FROM ORDINARY ACTIVITIES AFTER TAXES 165, , , , PROFIT (LOSS) FOR THE PERIOD 165, , , , MINORITY INTERESTS 2,560 2,836 7,399 5,068 (49.5) 340 -PROFIT (LOSS) FOR THE PERIOD ATTRIBUTABLE TO THE PARENT BANK 163, , , , Earnings per share (in euro) - basic diluted (1) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". Figures as at September 2008 have been adequately reclassified to allow a homogeneous comparison among the different periods. 18

19 STATEMENT OF CONSOLIDATED COMPREHENSIVE INCOME STATEMENT OF CONSOLIDATED COMPREHENSIVE INCOME (in thousands of euro) Change 9/09-09/08 30/9/09 30/6/09 31/12/08 30/9/08 absolute % 10 PROFIT (LOSS) FOR THE PERIOD 165, , , ,116 (2,210) (1.3) Other income components after taxes 20 Available-for-sale financial assets 224, ,501 (232,522) (132,624) 356, Tangible assets Intangible assets Foreign investment hedge Cash flow hedge (9,667) 2,305 (56,310) (5,200) (4,467) Currency differences Non-current assets held for sale Actuarial profits (losses) on defined benefit plans Share of the valuation reserves of equity investments designated at equity 0 0 (74) 132 (132) (100.0) 110 Total other income components after taxes 214, ,806 (288,906) (137,692) 352, TOTAL PROFITABILITY (Item ) 380, ,350 (76,003) 30, , Total consolidated profitability attributable to minority interests 3,033 3,116 7,019 4,834 (1,801) (37.3) 140 Total consolidated profitability attributable to the Parent bank 377, ,234 (83,022) 25, ,892 Figures in thousands of euro 19

20 STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY Balance as at 31/12/2008 Of which balance as at 31/12/2008 attributable to minority interests Change in opening balances Balance as at 1/01//2009 Allocation of profits/losses for the previous year Reserves Capital: 1,801,901 11,602-1,801,901 2,120 (123) 1,803,898 13,598 a) ordinary shares 1,626,634 11,602 1,626,634 2,120 (123) 1,628,631 13,598 b) other shares 175, , ,267 - Additional paid-in capital 1,018,387 5,128 1,018,387 (489) 1,017,898 5,156 Reserves: 165,918 6, ,918 59, ,206 (4,018) ,292 6,883 a) profits 101,678 6, ,678 59, (4,018) 156,866 6,609 b) other 64, ,240-18,186 82, Dividends and other allocations Changes in reserves New shares issued Changes in the year Transactions on shareholders' equity Own shares purchased Extraordinary distribution of dividends Changes in capital instruments Own shares derivatives Stock options Total profitability for the period as at 30/09/2009 Shareholders equity as at 30/09/2009 of which shareholders' equity as at 30/09/2009 attributable to minority interests Valuation reserves 375,856 3, ,856 - (20,314) 214, ,151 1,851 Capital instruments 1,179-1,179 (1) 1,178 - Own shares (17) (17) (17) 2 (15) (15) Profit (Loss) for the period 212,903 7, ,903 (59,098) (153,805) 165, ,906 2,560 Shareholders' equity 3,576,127 34,373-3,576,127 - (153,805) 88 (476) (4,141) ,515 3,798,308 30,033 The opening balance takes into account the reclassification between profit reserves and capital reserves carried out in the statement of changes in shareholders' equity as at 31/12/

21 STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY Balance as at 31/12/2007 Of which balance as at 31/12/2007 attributable to min Change in opening balances Balance as at 1/01//2008 Allocation of profits/losses for the previous year Reserves Capital: 1,400,446 10,364-1,400,446 (10) 401,465 1,801,901 11,602 a) ordinary shares 1,225,098 10,364 1,225,098 (10) 401,546 1,626,634 11,602 b) other shares 175, ,348 (81) 175,267 - Additional paid-in capital 466,233 5, ,233 (41) 552,195 1,018,387 5,128 Reserves: 117,331 7, ,331 58,499 - (8,529) (1,309) (74) 165,918 6,754 a) profits 87,092 6,431 (35,384) 51,708 58,499 (8,529) - 101,678 6,480 b) other 30,239 1,248 35,384 65,623 - (1,309) (74) 64, Dividends and other allocations Changes in reserves New shares issued Changes in the year Transactions on shareholders' equity Own shares purchased Extraordinary distribution of dividends Changes in capital instruments Own shares derivatives Stock options Total profitability for the period as at 31/12/2008 Shareholders equity as at 31/12/2008 of which shareholders' equity as at 31/12/2008 attributable to minority interests Valuation reserves 664,859 3, ,859 - (171) (288,832) 375,856 3,507 Capital instruments 1,219-1,219 (40) 1,179 - Own shares (17) (17) (17) - (17) (17) Profit (Loss) for the period 212,305 7, ,305 (58,499) (153,806) 212, ,903 7,399 Shareholders' equity 2,862,376 34,573-2,862,376 - (153,806) (8,580) 952, (76,003) 3,576,127 34,373 With respect to the statement of changes in the shareholders' equity published in the 2008 consolidated half-year report a reclassification between profit reserves and other reserves has been carried out. This reclassification is shown in the column "Change in opening balances". 21

22 STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY Balance as at 31/12/2007 Of which balance as at 31/12/2007 attributable to min Change in opening balances Balance as at 1/01//2008 Allocation of profits/losses for the previous year Reserves Capital: 1,400,446 10,364-1,400,446 (7) 401,145 1,801,584 11,605 a) ordinary shares 1,225,098 10,364 1,225,098 (7) 401,226 1,626,317 11,605 b) other shares 175, ,348 (81) 175,267 - Additional paid-in capital 466,233 5, ,233 (30) 552,312 1,018,515 5,139 Reserves: 117,331 7, ,331 58,499-6,557 (1,309) ,210 21,499 a) profits 87,092 6,431 (35,384) 51,708 58,499 6, ,764 21,224 b) other 30,239 1,248 35,384 65,623 - (1,309) , Dividends and other allocations Changes in reserves New shares issued Own shares purchased Changes in the year Transactions on shareholders' equity Extraordinary distribution of dividends Changes in capital instruments Own shares derivatives Stock options Total profitability for the period as at 30/09/2008 Shareholders equity as at 30/09/2008 of which shareholders' equity as at 30/09/2008 attributable to minority interests Valuation reserves 664,859 3, ,859 (137,825) (365) (137,824) 388,845 3,650 Capital instruments 1,219-1, ,264 - Own shares (17) (17) (17) - (17) (17) Profit (Loss) for the period 212,305 7, ,305 (58,499) (153,806) 168, ,116 5,068 Shareholders' equity 2,862,376 34,573-2,862,376 - (153,806) (131,305) 951, ,424 3,559,517 46,944 With respect to the statement of changes in the shareholders' equity published in the consolidated report as at September 2008 a reclassification between profit reserves and other reserves has been carried out. This reclassification is shown in the column "Change in opening balances". 22

23 CONSOLIDATED CASH FLOW STATEMENT Direct method Amount A. OPERATING ACTIVITIES 30/9/09 30/6/09 31/12/08 30/9/08 1. Management 937, , , ,890 - interest income received (+) 841, ,415 1,483,264 1,129,376 - interest expenses paid (-) (375,811) (284,728) (640,522) (470,014) - dividends and similar revenues (+) 10,302 9,825 14,818 12,445 - net commissions (+/-) 202, , , ,382 - staff costs (-) (253,603) (170,520) (307,656) (226,096) - net premiums collected 1,146, , , ,797 - other insurance revenues and expenses (+/-) (494,467) (327,666) (471,225) (396,818) - other costs (-) (215,582) (153,314) (484,728) (302,887) - other revenues (+) 105,989 75, , ,160 - taxes and duties (-) (29,197) (28,399) (102,590) (49,455) 2. Liquidity generated/absorbed by financial assets (2,118,132) (1,593,192) (3,866,021) (2,286,016) - financial assets held for trading (73,580) (112,926) 394,117 62,435 - financial assets designated at fair value 41,144 46,836 (72,375) 28,723 - available-for-sale financial assets (1,972,422) (1,022,633) (619,611) (330,155) - loans to customers (739,847) (725,227) (3,589,152) (2,053,724) - loans to banks: at sight (34,834) (50,270) (86) 176,886 - loans to banks: other loans 366, , ,307 58,264 - other assets 294,512 59,526 (503,221) (228,445) 3. Cash generated/absorbed by financial liabilities 1,360,288 1,128,617 3,173,115 1,682,677 - amounts owed to banks: at sight 744,848 (403,890) 149,794 (62,328) - amounts owed to banks: other (441,155) 131,487 (1,723,823) (1,234,610) - amounts owed to customers 2,025,040 1,400,157 2,441,152 1,202,512 - securities in issue (679,301) 171,630 2,306,643 1,844,804 - financial liabilities from trading 4,983 6,018 (8,130) (46,795) - financial liabilities designated at fair value (30,681) (26,754) 6,192 (12,020) - other liabilities (263,446) (150,031) 1,287 (8,886) Net liquidity generated/absorbed by operating activities 179, , ,790 95,551 B. INVESTING ACTIVITIES 1. Liquidity generated by 27,424 22,989 67,295 17,560 - equity investment disposals ,324 - dividends received on equity investments ,444 1,887 - disposal/reimbursement of financial assets held to maturity 25,764 21, tangible asset disposals 1,132 1,082 30, subsidiary and business unit disposals , Liquidity absorbed by (96,458) (92,894) (1,116,540) (932,753) - equity investment acquisitions (10) - (96) (15,727) - acquisitions of financial assets held to maturity (63,176) (73,428) - (1) - tangible asset acquisitions (10,310) (6,367) (80,942) (48,539) - intangible asset acquisitions (22,962) (13,099) (61,452) (22,312) - business unit acquisitions - - (974,050) (846,174) Net liquidity generated/absorbed by investing activities (69,034) (69,905) (1,049,245) (915,193) C. FUNDING ACTIVITIES - own share issues/acquisitions (4,141) - 398, ,852 - additional paid-in capital , ,934 - dividend distribution and others (153,805) (153,805) (153,806) (153,806) Net liquidity generated/absorbed by funding activities (157,946) (153,805) 795, ,980 NET LIQUIDITY GENERATED/ABSORBED DURING THE PERIOD (47,360) (26,093) 46,003 (23,662) KEY: (+) generated (-) absorbed Figures in thousands of euro RECONCILIATION Balance sheet items Amount 30/9/09 30/6/09 31/12/08 30/9/08 Cash and cash equivalents at the beginning of the period 289, , , ,720 Total net liquidity generated/absorbed during the period (47,360) (26,093) 46,003 (23,662) Cash and cash equivalents at period end 242, , , ,058 Figures in thousands of euro 23

24 EXPLANATORY NOTES 24

25 ACCOUNTING POLICIES The Interim Report on Operations of the Banca Carige Group for the third quarter of 2009 was drawn up in accordance with IAS 34 (Interim financial statements). The international accounting principles IAS/IFRS and the related interpretations (SIC/IFRIC), officially approved by the European Union and in force on 30 September 2009, were applied for the valuation and measurement of the accounting balances, and where necessary, the directions referred to in the Bank of Italy Circular no. 262 dated 22 December 2005 were observed (financial statements for banks: schemes and rules for preparation). As regards the phases of classification, recording, valuation and cancellation of asset and liability items involved in preparing this Report, as with the methods of entering costs and revenues, the same accounting standards used in preparation of the financial statements as at 31 December 2008 were applied, with the exception of what is detailed below. Accounting principles that had an impact on the preparation of the Interim Report on Operations: - IAS 1 Presentation of financial statements: in September 2007 the IASB published the new version of IAS 1 Presentation of financial statements (approved with Regulation EC no. 1274/2008 of 17 December 2008), whose application is obligatory for all financial statements pertaining to financial years starting 1 January The main difference from the previous version concerns the introduction of the statement of comprehensive income for which those preparing the financial statements were granted the option of presenting items that make up the income statement and other profit components ( other comprehensive income ) recorded directly in shareholders equity for transactions different from those entered into with shareholders, in a single summary statement or in two separate statements; the Group opted for the presentation of two statements: the income statement and the statement of comprehensive income. Instead, transactions entered into with shareholders, together with the comprehensive income result, are shown in the statement of changes in shareholders equity; - IFRS 8 Operating Segments: in November 2006, the IASB published IFRS 8 - Operating Segments (approved with Regulation EC no. 1358/2007 of 21 November 2007), replacing IAS 14 - Sector information and whose application is obligatory for financial statements pertaining to financial years starting on or after 1 January The new regulations place the focus on the definition of sectors that are the subject of information according to the so-called management approach, or by making exclusive reference to the internal organisational structure and reports provided periodically to the highest operational decision-making level for the adoption of strategic decisions: therefore, the distinction between the primary and secondary sector disappears. In addition, effective obligatorily for all financial statements pertaining to financial years starting on or after 1 January 2009, the following principles (IAS/IFRS) and interpretations (SIC/IFRIC) will be applied to this Interim Financial Report as well as the relative changes that have no significant impact on the preparation of the report: - IAS 23 Financial charges (Reg. EC no. 1260/2008 dated 10 December 2008); - IFRS 2 Share-based payments (Reg. EC no. 1261/2008 dated 16 December 2008); - IFRIC 13 - Customer loyalty programs (Reg. EC no. 1262/2008 dated 16 December 2008) - IFRIC 14 The limit on a defined benefit asset, minimum contribution requirements and their interaction (Reg. 1263/2008 of 16 December 2008); - Amendments to IAS 32 Financial instruments: presentation and IAS 1 presentation of financial statements relative to puttable financial instruments and obligations arising on liquidation (Reg. EC no. 53/2009 dated 21 January 2009); - Amendments to IFRS 1 First-time adoption of IFRS and IAS 27, Reg. EC no. 69/2009 dated 23 January 2009); - Improvements made to IFRS within the framework of the annual improvement process aimed at simplifying and clarifying international accounting 25

26 principles IAS/IFRS (Reg. EC no. 70/2009 dated 23 January 2009); - IFRIC 16 Hedges of a net investment in a foreign operation (Reg. EC 460/2009 of 4 June 2009); - IFRIC 15 Agreements for the construction of real estate (Reg. 636/2009 of 22 July 2009). Lastly, please note that during the third quarter of 2009 further amendments were approved to IAS 39 Financial instruments and IFRS 7 Financial instruments: Disclosures, concerning the Reclassification of financial assets Effective date and transition (Reg. EC no. 824/2009 of 9 September 2009), which specifies that this regulation shall apply from 1 July The amendment was also approved to IAS 39 Financial instruments: Recognition and measurement entitled Eligible hedged items (Reg. EC no. 839/2009 of 15 September 2009) that will be applied to financial statements for reporting periods beginning on or after 30 June THE ACQUISITION OF 40 BRANCHES FROM THE UNICREDIT GROUP With reference to the acquisition, effective from 1 December 2008, by Banca Carige, of business units in the form of 40 branches from the UniCredit Group (that as at 30 September 2009 had intermediated a total of euro 1,491.5 million), the following should be noted: - on 21 November 2008, a provisional price of euro million was paid; - the provisional price, as contractually agreed, was subject to upward or downward revision, based on the Direct and Indirect Deposits of the business units acquired at the effective date; - the final price communicated by the Transferring Banks and accepted by Banca Carige on 31 March was a total of euro 27.0 million less (euro million); - the transfer equity situations were defined on 5 August with the signing of notary documents regarding the determination of the final price for the business unit sale and the subsequent regulation of imbalances in favour of Banca Carige; - the acquisition was accounted for in accordance with the provisions of IFRS 3 Business combinations and so: - the acquisition was recorded on the date in which control over acquired assets was obtained; - the cost of the operation was determined as the sum of the fair value, at acquisition date, of the acquired assets and liabilities and any ancillary charges directly attributable to the acquisition, such as the external costs incurred in completion of the transaction, including, for example, fees paid to auditors, experts, legal counsels as well as advisory fees incurred; - goodwill stood at euro million, equal to the price agreed by the parties, plus euro 3.3 million in directly attributable ancillary charges for a total of euro million. This could, however, still change to an insignificant extent following the definition of directly attributable ancillary charges. Provisional accounting of goodwill conforms to the provisions of IFRS 3, paragraph 62. The Consolidated Interim Financial Statements contained in this Interim Financial Report have been audited by the company Deloitte & Touche SpA. AREA AND METHODS OF CONSOLIDATION 1. EQUITY INVESTMENTS IN WHOLLY-OWNED SUBSIDIARIES AND SUBSIDIARIES SUBJECT TO JOINT CONTROL Based on the IAS/IFRS principles, the area of consolidation includes all subsidiaries, whether held directly or indirectly: therefore, even companies not classified as credit, financial or instrumental institutions (i.e. dissimilar activities) have been consolidated on a line-by-line basis. The concept of control applied is that set out in IAS 27. During the first nine months of 2009 the area of consolidation did not change with respect to the area established for the preparation of the financial statements as at 31 December

27 Please note that on 29 September 2009 Carige Vita Nuova SpA purchased an additional 35% of the share capital of the subsidiary Assi 90 Srl for the consideration of euro 5.6 million and consequently the shareholding owned by Carige Vita Nuova SpA has now increased to 57.5% whilst the 37.5% shareholding owned by Carige Assicurazioni SpA has remained unchanged. Type of relations Shareholding relationship Availability of votes (2) (3) Name of the companies Head offices hip Holding company (1) % Shareholding Actual % Potential % A. Companies A.1 Consolidated line-by-line Banking group 1. Banca CARIGE SpA Genoa 2. Cassa di Risparmio di Savona SpA Savona 1 A Cassa di Risparmio di Carrara SpA Carrara 1 A Banca del Monte Lucca SpA Lucca 1 A Banca Cesare Ponti SpA Milan 1 A Carige Asset Management SGR SpA Genoa 1 A A Creditis Servizi Finanziari SpA Genoa 1 A Centro Fiduciario SpA Genoa 1 A A Argo Finance One Srl Genoa 1 A Priamar Finance Srl Genoa 1 A Argo Mortgage Srl Genoa 1 A Argo Mortgage 2 Srl Genoa 1 A Carige Covered Bond Srl Genoa 1 A Columbus Carige Immobiliare SpA Genoa 1 A A Galeazzo srl Genoa 1 A Immobiliare Ettore Vernazza SpA (4) Genoa 1 A Immobilire CARISA Srl Savona 1 A Insurance companies 18. Carige Assicurazioni SpA (4) Milan 1 A Carige Vita Nuova SpA Genoa 1 A Other companies 20. Dafne Immobiliare Srl Milan 1 A I. H. Roma Srl Milan 1 A Assi 90 Srl Genoa 1 A A A.2 Consolidated proportionally Key (1) Type of relationship: 1 = majority of voting rights at ordinary shareholders meeting 2 = dominant influence at ordinary shareholders meeting 3 = agreements with other shareholders 4 = other forms of control 5 = single management pursuant to article 26, paragraph 1 of Legislative Decree 87/92 6 = single management pursuant to article 26, paragraph 2 of Legislative Decree 87/92 7 = joint control (2) Availability of voting rights at ordinary shareholders meeting, distinguishing between actual and potential (3) Figure entered only if different from the equity investment share (4) The percentage of actual availability of votes differs from the equity investment share as it is calculated on the capital excluding own shares. With regard to operations, the subsidiaries can be divided into banking (Banca Carige SpA, Cassa di Risparmio di Savona SpA, Cassa di Risparmio di Carrara SpA, Banca del Monte di Lucca SpA, Banca Cesare Ponti SpA), asset management (Carige Asset Management SGR SpA), financial (Creditis Servizi Finanziari SpA), trust companies (Centro Fiduciario SpA), special purpose vehicles for securitisation transactions (Argo Finance One Srl, Priamar Finance Srl, Argo Mortgage Srl, Argo Mortgage 2 Srl), special purpose vehicles for covered bond issue transactions (Carige Covered Bond Srl), insurance (Carige Vita Nuova Spa, Carige assicurazioni SpA) real estate (Immobiliare Ettore Vernazza Srl, Galeazzo Srl, Columbus Carige Immobiliare SpA, Immobiliare Carisa Srl, Dafne Immobiliare Srl and I.H. Roma Srl) and insurance agencies (Assi 90 Srl). 27

28 With regard to the four companies established for the same number of securitisation transactions - Argo Finance One, Priamar Finance, Argo Mortgage and Argo Mortgage 2 and to the company Carige Covered Bond please note that they have all been consolidated in these financial statements on a line-by-line basis. With regard to the securitisation of Banca Carige s performing loans carried out by Argo Mortgage 2 in 2004, as the transaction does not fully satisfy the conditions of the substantial transfer to third parties of related risks and rewards, consolidation was carried out on the basis of the company s segregated assets. The consolidated interim financial statements have been prepared using: - the draft interim financial statements of the Parent Bank and of the other consolidated companies as at 30 September 2009, approved by their respective Boards of Directors and prepared in accordance with the approved IAS/IFRS in force; - reporting packages prepared by the companies that did not adopt the IAS/IFRS and approved by the respective Management Bodies. There are no subsidiaries excluded from the area of consolidation. The liquidation process regarding Savona 2000 in fact concluded with its removal from the Register of Companies on 14 January Companies for which shares with voting rights have been received as a form of credit guarantee rather than as a means of exercising control over the companies under review were also excluded from the area of consolidation. 2. OTHER INFORMATION Associates that are entities in which the Group has significant influence were valued according to the equity method. Name of the companies Head offices Shareholding relationship Availability of votes Holding company % Shareholding Actual % Potential % A. Companies consolidated with the equity method 1. Autostrada dei Fiori SpA Savona Banca Carige SpA Cassa di Risparmio di Savona SpA Recina Servizi SpA Rome Assi 90 Srl Companies in which the Group exerts a significant influence that are not considered to be significant have been valued at cost, in accordance with the general principles set out in the framework. Those companies with balance totals of less than euro 10 million, and provided that the total of the companies excluded does not exceed euro 50 million, have been classified as minor subsidiaries, in accordance with the provisions on consolidated supervisory reporting established in the Bank of Italy s thirteenth update dated 25 January 2006 to its circular no. 115 of 7 August Name of the companies Head offices Shareholding relationship Availability of votes Holding company % Shareholding Actual % Potential % 1. Assimilano Srl Milan Assi 90 Srl Sport e Sicurezza Srl Florence Carige Ass.ni SpA Carige V. N. SpA Nuova Erzelli Srl Genoa Banca Carige SpA Consorzio per il Giurista di Impresa Scrl Genoa Banca Carige SpA World Trade Center Genoa SpA in liquidation Genoa Banca Carige SpA

29 INTERMEDIATION ACTIVITIES As at 30 September 2009, total Financial Intermediation Activities on behalf of customers (FIA) direct and indirect deposits amounted to euro 44,618.5 million, a 3.5% increase compared to December 2008 and up 5.3% on a YoY basis. Direct deposits stand at 23,485.8 million, an increase of 6% from the start of the year and 14.7% compared to September 2008; indirect deposits equal 21,132.6 million, substantially stabile over nine months (+0.8%) and a decreased over twelve months (-3.5%). Indirect deposits represent 47.4% of total FIA and are composed of assets under management, for 54.4%, and assets in custody, for the remaining 45.6%. FINANCIAL INTERMEDIATION ACTIVITIES (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Total (A+B) 44,618,475 44,631,423 43,124,348 42,381, Direct deposits (A) 23,485,846 23,711,470 22,164,080 20,475, % on Total 52.6% 53.1% 51.4% 48.3% Indirect deposits (B) 21,132,629 20,919,953 20,960,268 21,905, % on Total 47.4% 46.9% 48.6% 51.7% - Assets under management 11,497,235 10,942,776 10,438,552 10,947, % on Total 25.8% 24.5% 24.2% 25.8% % on Indirect deposits 54.4% 52.3% 49.8% 50.0% - Assets in custody 9,635,394 9,977,177 10,521,716 10,957, % on Total 21.6% 22.4% 24.4% 25.9% % on Indirect deposits 45.6% 47.7% 50.2% 50.0% Total funding, which includes direct deposits from customers (euro 23,485.8 million) and banks (euro 1,102.5 million), amounted to euro 24,588.4 million, up in both over nine months and on a YoY basis, by 7.1% and 14% respectively. Direct deposits increased by 6% from the beginning of the year and 14.7% in twelve months, sustained by the growth in both amounts owed to customers, at euro 14,042.2 million (17% in nine months and 30.4% in twelve months) and securities in issue at euro 8,829.6 million, decreasing by 7.8% and 3.4% respectively in the nine and twelve months respectively, mainly in relation to the expiry at the beginning of the year of about 900 million of bonds part of the EMTN programme and undersigned by institutional investors. Short-term deposits (euro 14,166.1 million), accounting for 60.3% of the aggregate, rose by 16.4% from the start of the year and 29.7% from September 2008, driven in particular, by the success of the new online deposit account, Contoconto, while the medium/long-term component (euro 9,319.7 million) increased by 6.8% and 2.5% in nine and twelve months respectively. The liabilities designated at fair value (euro million, +5.9% compared with December, and +8.3% compared to September 2008) are mainly comprised of structured bonds, placed through Poste Italiane; they do not include the liabilities at fair value of Carige Vita Nuova, related to those insurance products the investment risk of which rests on the insured. Amounts owed to banks totalled euro 1,102.5 million, with an increase of 37.6% in the first nine months of the year, and of 1.5% on a YoY basis. 29

30 FUNDING (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Total (A+B) 24,588,373 24,237,075 22,965,533 21,562, Direct deposits (A) 23,485,846 23,711,470 22,164,080 20,475, Amounts owed to customers 14,042,180 13,412,317 12,005,439 10,766, current accounts and free deposits 13,845,354 13,185,670 11,522,358 9,894, repurchase agreements 25,282 55, , , term deposits 24,951 26,077 33,759 42, loans 3,371 3,408 11, , funds managed on behalf of third parties commitments to repurchase own equity instruments 25,765 25,552 25,127 24, other deposits 117, , ,606 99, Securities in issue 8,829,550 9,685,828 9,578,795 9,142, bonds 8,643,421 9,470,225 9,344,042 8,932, other securities 186, , , , Liabilities at fair value (1) 614, , , , bonds 614, , , , short term 14,166,121 13,564,077 12,167,499 10,918, % on Total medium-long term 9,319,725 10,147,393 9,996,581 9,557, % on Total Amounts owed to banks (B) 1,102, , ,453 1,086, Deposits of central banks 24,066 25,004-59, Current accounts and free deposits 15,811 18, ,106 81, Term deposits 141, , , , Repurchase agreements 603,006 60,187-65,414 Loans 318, , , , Other (1) Carige Vita Nuova liabilities, designated at fair value and relating to products for which risk is borne by the insured, are not included in this table. Liguria s contribution to direct deposits stood at 55.4% (55.7% at December and 57.2% at September 2008 when the 40 branches had not yet been purchased from the Unicredit Group). Lombardy recorded the second biggest contribution with 9.1% (8.8% at December and at September 2008). Tuscany was third with an 8.8% share, followed by Veneto (6.3%) and Lazio (6%). DIRECT DEPOSITS (1) - GEOGRAPHICAL DISTRIBUTION (2) (figures in thousands of euro) Situation as at 30/9/09 30/6/09 31/12/08 30/9/08 % % % % Liguria 10,890, % 10,670, % 10,295, % 9,725, % Lombardy 1,789, % 1,817, % 1,627, % 1,491, % Tuscany 1,732, % 1,732, % 1,751, % 1,500, % Veneto 1,232, % 1,205, % 1,164, % 1,079, % Latium 1,187, % 1,159, % 1,121, % 1,150, % Sicily 1,016, % 926, % 930, % 620, % Piedmont 764, % 784, % 706, % 643, % Emilia Romagna 331, % 357, % 286, % 231, % Apulia 269, % 247, % 250, % 236, % Sardinia 222, % 207, % 151, % 152, % Marches 104, % 101, % 97, % 90, % Valle d'aosta 49, % 50, % 43, % 37, % Umbria 40, % 40, % 38, % 21, % Total Italy 19,631, % 19,302, % 18,466, % 16,983, % Abroad 32, % 30, % 31, % 28, % Total Italy + Abroad 19,664, % 19,332, % 18,497, % 17,011, % Other items (3) 3,821,735 4,378,855 3,666,800 3,464,546 Total direct deposits 23,485,846 23,711,470 22,164,080 20,475,929 (1) Items 20, 30 and 50 of Liabilities and Shareholders' equity. Carige Vita Nuova liabilities, designated at fair value and relating to products for which investment risk is borne by the insured, are not included in this table. (2) Figures per branch province. (3) Bonds issued under the EMTN programme, bonds issued and placed through the BancoPosta network, other bonds issued by the SPV relating to the securitization of loans, and deposits from the "contoconto" on line deposit account. 69.1% of amounts owed to customers, equal to 9,703.7 million, is due to families whose share over the total increases each year by over 5 percentage points compared to a decrease in all 30

31 the other sectors. The share of non-financial businesses and personal businesses decreased by 19.9% (Euro 2,790 million) (21% in December and 22.3% in September 2008); public bodies intermediated Euro million (4.6% of the aggregate), private social bodies and non classified entities Euro million and financial businesses Euro million (3.4% and 2.5% respectively). DIRECT DEPOSITS (1) - DISTRIBUTION BY BUSINESS SEGMENT (figures in thousands of euro) 30/09/09 30/06/09 31/12/08 30/9/08 % % % % Amounts owed to customers 14,042,180 13,412,317 12,005,439 10,766,712 Public Administration 644, % 677, % 642, % 627, % Financial businesses 348, % 354, % 384, % 363, % Non-financial businesses and personal businesses 2,789, % 2,720, % 2,516, % 2,396, % Private social bodies 477, % 428, % 477, % 473, % Families 9,703, % 9,147, % 7,920, % 6,848, % Total residents 13,964, % 13,329, % 11,941, % 10,708, % Non residents 78, % 83, % 64, % 57, % Total 14,042, % 13,412, % 12,005, % 10,766, % Securities in issue 8,829,550 9,685,828 9,578,795 9,142,064 Liabilities at fair value 614, , , ,153 TOTAL DIRECT DEPOSITS 23,485,846 23,711,470 22,164,080 20,475,929 (1) Items 20, 30 and 50 of Liabilities and Shareholders' equity. Carige Vita Nuova liabilities, designated at fair value and relating to products for which investment risk is borne by the insured, are not included in this table. Indirect deposits amounted to 21,132.6 million, essentially stable from the start of the year (+0.8%) but down over the twelve month period (-3.5%) in relation to the trend of the assets in custody. Assets under management, standing at euro 11,497.2 million, grew by 10.1% in the nine months, but fell by 5% over September These include mutual funds which fell to euro 4,571.5 million (-2.5% and -15% in nine and twelve months respectively), while assets managed rose to euro 3,729.1 million (with increases of 20.9% and 19.5% respectively) and bancassurance products to euro 3,196.6 million (20% and 30.5%). Assets in custody amounted to euro 9,635.4 million, down by 8.4% in nine months and 12.1% in twelve months; during the same periods Government securities, at euro 4,960.9 million, decreased by 17.4% and 16.3% respectively while the other components rose by 3.5% in the nine months and fell by 7.1% in the twelve month period, totalling euro 4,674.5 million. INDIRECT DEPOSITS (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Total (A+B) 21,132,629 20,919,953 20,960,268 21,905, Assets under management (A) 11,497,235 10,942,776 10,438,552 10,947, Mutual funds and unit trusts 4,571,492 4,347,081 4,688,404 5,377, Assets management 3,729,101 3,529,420 3,085,316 3,120, Bancassurance products 3,196,642 3,066,275 2,664,832 2,449, Assets in custody (B) 9,635,394 9,977,177 10,521,716 10,957, Government securities 4,960,938 5,407,413 6,007,358 5,927, Other 4,674,456 4,569,764 4,514,358 5,030, Premiums collected on bancassurance products increased from euro million in the first nine months of 2008 to euro million in the same period of the current year, mainly driven by traditional life policies (euro 741 million compared with euro million in the first nine months of 2008), in particular by the new product Carige soluzione rendimento. Unit linked and Gestlink policy premiums amounted to Euro 11.6 million, down by 92.6% compared to September Premiums collected in the non-life insurance amounted to Euro 7.4 million (Euro 4.1 million at September 2008); inside the Credit Protection Insurance (CPI) products show a lively trend, the protection insurance policies sold in combination with mortgages, whose premiums collected reached Euro 4.6 million in September (0.7 mil- 31

32 lion and 1.4 million respectively at September and December 2008). BANCASSURANCE (figures in thousands of euro ) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/08 Total premiums collected 759, , , ,126 Life, of which: 752, , , ,023. Unit-linked policies/gestlink 11,594 6, , , Traditional policies 740, , , ,298 Non life, of which: 7,373 6,486 5,760 4, Car insurance Non car insurance 6,701 5,957 4,796 3,285 - Correntista sicuro ,376 1, Casa assicurata C/c assicurato Famiglia Assicurata , Mutuo 100% Mutuo CPI 4,589 4,416 1, Within indirect deposits, Liguria's contribution was equal to 64.6% (63% in December and 64.8% in September 2008), followed by Lombardy (11.1%; 11.3% in December and in September 2008) and by Tuscany (6%; 5.9% in December and in September 2008). INDIRECT DEPOSITS - GEOGRAPHICAL DISTRIBUTION (1) (figures in thousands of euro) Situation as at 30/9/09 30/6/09 31/12/08 30/9/08 % % % % Liguria 13,646, % 13,393, % 13,195, % 14,202, % Lombardy 2,341, % 2,332, % 2,360, % 2,465, % Tuscany 1,274, % 1,274, % 1,245, % 1,288, % Veneto 1,138, % 1,156, % 1,243, % 1,356, % Piedmont 755, % 754, % 781, % 847, % Latium 676, % 691, % 740, % 645, % Sicily 680, % 674, % 739, % 419, % Emilia Romagna 241, % 248, % 272, % 277, % Apulia 90, % 96, % 104, % 120, % Sardinia 107, % 114, % 77, % 85, % Valle d'aosta 70, % 70, % 83, % 92, % Marches 66, % 66, % 65, % 71, % Umbria 41, % 42, % 45, % 24, % Total Italy 21,128, % 20,914, % 20,955, % 21,899, % Abroad 4, % 5, % 5, % 5, % Total indirect deposits 21,132, % 20,919, % 20,960, % 21,905, % (1) Figures per branch province. The main portion of indirect deposits is concentrated in the family segment, with 75% (77.6% at the end of the year and 78.3% in September 2008). Financial companies represent 18% of the total (15.1% in December and 13.8% in September

33 INDIRECT DEPOSITS - DISTRIBUTION BY BUSINESS SEGMENT (figures in thousands of euro) 30/09/09 30/06/09 31/12/08 30/9/08 % % % % Public Administration 134, % 124, % 115, % 146, % Financial businesses 3,807, % 3,623, % 3,169, % 3,023, % Non-financial businesses and personal businesses 1,059, % 1,118, % 1,112, % 1,301, % Private social bodies 170, % 172, % 168, % 177, % Families 15,842, % 15,764, % 16,274, % 17,138, % Total residents 21,014, % 20,804, % 20,840, % 21,786, % Non residents 118, % 115, % 120, % 118, % Total 21,132, % 20,919, % 20,960, % 21,905, % Cash loans to customers, net of value adjustments of euro million, amounted to euro 21,409.9 million, up by 3.7% compared with the end of 2008 (and up 12.4% in twelve months); before value adjustments, they totalled euro 21,924.6 million (+3.8% and +12.1% in nine and twelve months). The mortgage loans, inclusive of assets sold and not cancelled, equal euro 11,852.7 million, account for more than 50% of loans to customers and grow by 6.5% compared with December, and by 10.7% compared with September Current accounts, equal to euro 2,792.9 million, fell by 4.8% since December but increased by 2.8% since September. Items in other receivables increased (euro 4,187 million; +14.2% and +23.1% in nine and twelve months respectively), particularly as a result of the larger syndicated loans, credit cards, personal loans, and salary-backed loans amounting to euro million (+8% and +10%), while leasing fell, standing at euro million (-0.7% and -1,7% in nine and twelve months, respectively), and factoring totalling euro million (-3% over December and +0.5% over September 2008). As regards maturities, short term lending, equal to Euro 4,972.2 million, was down by 11.1% in the nine month period and was up by 7.7% against September 2008; the medium-long term component, equal to Euro 16,168.4 million, was up by 8.5% in the nine month period and by 13.2% in the twelve month period. Bad loans reached euro million, representing 3.6% of total lending, up by 2.9% over December and 3.4% over September Loans to banks, net of value adjustments for euro 0.9 million (euro 0.8 million in December and euro 0.6 million in September 2008), amounted to euro million, down by 33.8% in the nine month period and by 48.1% in twelve months; they are mostly comprised of short-term loans. The net interbank position (difference between loans and amounts owed to banks) shows a net debt position of euro million (net credit position of euro million in December and euro in September 2008). 33

34 LOANS (1) (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Total (A+B) 22,063,053 22,190,589 21,634,328 20,309, Loans to customers (A) 21,409,914 21,359,433 20,648,153 19,050, nominal value (2) 21,924,619 21,854,345 21,119,889 19,558, current accounts 2,792,948 2,635,231 2,932,602 2,716, lending repurchase agreements - 255, , mortgages (3) (4) 11,495,700 11,166,492 10,719,390 10,235, credit cards, personal loans and salary-backed loans 567, , , , leasing 816, , , , factoring 118, , , , other loans 4,186,970 4,448,555 3,667,322 3,400, assets sold and not cancelled (3) 357, , , , impaired assets (3) (5) 1,590,349 1,490,269 1,258,331 1,271, short term 4,972,248 5,184,219 5,595,357 4,616, % on nominal value medium/long term 16,168,447 15,949,917 14,902,783 14,279, % on nominal value Bad loans 783, , , , % on nominal value Value adjustments (-) 514, , , , Loans to banks (B) 653, , ,175 1,258, nominal value (2) 654, , ,953 1,258, compulsory reserves 278, , , , other loans to central banks current accounts and free deposits 78, , , , term deposits 32, , , , repurchase agreements 120, ,813 23, , loans 127,621 63, ,925 95, impaired assets 15,875 16,326 16,116 16, short term 608, , ,591 1,230, % on nominal value medium/long term 45,727 63,690 47,362 28, % on nominal value Bad loans % on nominal value Value adjustments (-) (1) Net of debt securities classified as L&R. (2) Before value adjustments. (3) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has sent, inter alia, a note containing some modifications relative to the tables of the explanatory notes. In particular, a specific item "Securities in issue" has been introduced in table C.2.2 "Financial liabilities corresponding to financial assets sold and not cancelled" of part E "Information on risks and the related hedging policies". This item has to gather in the financial statements all the securities issued by the vehicle companies consolidated on a line-by-line basis corresponding to assets sold and cancelled from the financial statements of the "originating" bank. In light of such new provision the Bank has decided to record also the assets sold to the vehicle companies consolidate in item "assets sold and not cancelled" and no longer in item "mortgages" and "impaired assets". The figures for the previous periods have been adequately reclassified to allow a homogeneous comparison. Following some recent clarifications provided by the Bank of Italy, loans included in sub-item "assets sold and not cancelled" related to securitisation transactions, for which no "derecognition" has taken place, have been reclassified to subitems "mortgages" and "impaired assets". (4) Including the fair value of loans for which we exercised the option of the so-called "Fair Value Option" (para. 9 IAS 39) - euro 753 thousand. (5) Impaired assets do not include assets sold and not cancelled. As regards the geographical breakdown, Liguria accounts for 48.2% of loans to customers, slightly down against the 48.3% registered in December but against the 47.4% registered in June Lombardy is the second region, with a share of 14.2% (13.9% in December and 14.6% in September 2008), Tuscany is third with a share of 8.4% (8.4% and 8.9% in December and September 2008 respectively). 34

35 TOTAL LOANS TO CUSTOMERS (1) - GEOGRAPHICAL DISTRIBUTION (2) (figures in thousands of euro) Situation as at 30/9/09 30/6/09 31/12/08 30/9/08 % % % % Liguria 10,557, % 10,571, % 10,197, % 9,275, % Lombardy 3,113, % 3,055, % 2,930, % 2,860, % Tuscany 1,837, % 1,834, % 1,783, % 1,740, % Piedmont 1,376, % 1,424, % 1,434, % 1,367, % Emilia Romagna 1,250, % 1,235, % 1,168, % 1,054, % Veneto 1,202, % 1,165, % 1,145, % 1,126, % Latium 903, % 900, % 879, % 808, % Sicily 625, % 613, % 608, % 396, % Sardinia 318, % 315, % 232, % 232, % Apulia 237, % 238, % 242, % 243, % Marches 155, % 155, % 163, % 154, % Umbria 98, % 98, % 102, % 80, % Valle d'aosta 24, % 23, % 22, % 20, % Total Italy 21,701, % 21,632, % 20,911, % 19,359, % Abroad 223, % 222, % 208, % 199, % Total loans to customers 21,924, % 21,854, % 21,119, % 19,558, % (1) Gross of value adjustments and net of debt securities classified as L&R. (2) Figures per branch province. Financial businesses and personal businesses represented 58.9% of loans to customers, amounting to euro 12,911.2 million (56.7% in December and 58.7% in September 2008) with an increase concentrated in the segment of other sales-related services; the share accounted for by families stood at 30%, compared with 30.8% in December and 32.2% in September 2008, totalling euro 6,578 million; that of public administrations stood at 5%, down compared with December and stable compared with September LOANS TO CUSTOMERS (1) - DISTRIBUTION BY BUSINESS SEGMENT (figures in thousands of euro) 30/09/09 30/06/09 31/12/08 30/9/08 Public Administration 1,100, % 1,042, % 1,077, % 982, % Financial businesses 797, % 1,032, % 1,305, % 554, % Non-financial businesses and personal businesses 12,911, % 12,639, % 11,974, % 11,474, % Sales-related services 3,998, % 3,763, % 3,547, % 3,353, % Building and public works 2,213, % 2,138, % 2,068, % 2,089, % Wholesale & retail trade, salvage and repairs 2,037, % 2,017, % 2,061, % 1,941, % Hotel and catering services 629, % 638, % 666, % 642, % Energy goods 584, % 724, % 371, % 301, % Other 3,446, % 3,357, % 3,258, % 3,145, % Private social bodies 113, % 108, % 106, % 110, % Families 6,578, % 6,656, % 6,494, % 6,299, % Total residents 21,500, % 21,480, % 20,959, % 19,421, % Non residents 424, % 374, % 160, % 137, % Total 21,924, % 21,854, % 21,119, % 19,558, % (1) Gross of value adjustments and net of debt securities classified as L&R. Impaired loans in aggregate to customers amounted to euro 1,635 million, up by 25.6% from the beginning of the year and by 24.2% in the twelve month period. The corresponding value adjustments were equal to Euro million, with an increase of 8.3% in the nine month period and of 2.6% against end of September 2008, with a hedging degree of the loans equal to 26.8% on total. Impaired cash loans to customers amounted to euro 1,612.5 million, an increase of 26.2% in nine months and 24.7% in twelve months. More specifically: bad loans were equal to Euro million, up by 26.1% from the beginning of the year and by 18.3% in September 2008; they were written down by 46% (53.8% in December and 55.1% in September 2008). The bad loans/loans ratio, with reference to customers, is equal to 3.6%. The Group, in line with the overall goal of a wider and more extensive use of rating system basic parameters in managerial and operational practice, adopted the statistical LGD model (Loss Given Default) for the evaluation of insignificant bad loan positions, developed inhouse on the basis of discounted historical flows of collections linked to the recovery process. The average amount of positions evaluated in this ways stood at roughly euro 40,000. The LGD model, which takes account of all direct and indirect costs connected with the recovery process makes it possible to maintain an analytical approach 35

36 to evaluating individual positions, examined, in fact, on the basis of different analysis axes which weigh up the nature of the borrower, the range of exposure at the moment of default, the type of guarantee given and its level of hedging. Application of this methodology permits positive results of an operating nature, in light of greater standardisation of processes and a higher level of consistency in the evaluation of the positions in question, and has a positive impact on value adjustments on the bad loans portfolio; watchlists amounted to Euro million, up by 12.6% from the beginning of the year and up by 54.4% in the twelve month period. They were written down by 13.8% (14.8% and 12.3% in December and September 2008); rescheduled loans amount to euro million, up compared with December (euro 5.2 million) and June 2008 (euro 3.8 million). They were written down by 2.2% (6% in December and 6.8% in September 2008); past due loans amounted to euro million, up in the nine month period (4.6%) and down against June 2008 (-22.9%. They were written down by 2.6% (1.8% and 5.6% in December and September 2008, respectively). Impaired credit commitments, all related to customers, totalled euro 22.5 million, a decrease compared with euro 24 million in December and euro 23.7 million in September Write-downs of these items covered 22.3% of the total (20.6% in December and 25.1% in September 2008). On the whole, value adjustments to customers amounted to euro million, of which euro million relative to cash loans and euro 9 million to endorsement loans. In the nine months, a more precise method to measure PD and LGD parameters was extended to all the Group Banks, already used for the Parent Bank and the Banca del Monte di Lucca to draw up the financial statements as at 31 December It represents the completion of an activity of review/streamlining of the internal rating models adopted. The intention of the Supervisory Body is to start the authorisation process, in order to make them fully compliant with the regulations of Basel 2 pursuant to Circular Bankit 263. In particular, the new LGD model, based on a greater number of samples, allows a more accurate quantification of the guarantee measures adopted to protect credit lines, taking into account, however, as prescribed by legislations, premiums at risk in discounting rates and also on all costs, direct and indirect, connected with the recovery process. 36

37 CREDIT QUALITY (1) (figures in thousands of euro) 30/09/09 30/06/09 Gross Value Net % Gross Value Net % exposure adjustments exposure b/a exposure adjustments exposure b/a (a) (b) (a)-(b) (a) (b) (a)-(b) Cash loans (2) Bad loans 783, , , , , , customers 783, , , , , , Watchlist loans 460,121 63, , ,391 59, , banks customers 459,874 63, , ,146 59, , Rescheduled loans 130,869 3, , ,811 4, , banks 15, , , , customers 115,243 2, , ,732 3, , Past due loans 253,425 6, , ,364 5, , banks customers 253,423 6, , ,362 5, , Total impaired loans 1,628, ,779 1,194, ,526, ,453 1,104, Performing loans 20,950,305 81,812 20,868, ,159,615 73,348 21,086, banks 638, , , , customers 20,312,155 81,812 20,230, ,343,896 73,348 20,270, Total cash loans 22,578, ,591 22,063, ,686, ,801 22,190, banks 654, , , , customers 21,924, ,705 21,409, ,854, ,912 21,359, Credit commitments Impaired 22,533 5,022 17, ,178 5,280 16, customers 22,533 5,022 17, ,178 5,280 16, Other loans 1,542,369 3,998 1,538, ,534,166 3,660 1,530, banks 20,376-20,376-18,528-18, customers 1,521,993 3,998 1,517, ,515,638 3,660 1,511, Total credit commitments 1,564,902 9,020 1,555, ,556,344 8,940 1,547, banks 20,376-20,376-18,528-18, customers 1,544,526 9,020 1,535, ,537,816 8,940 1,528, Total 24,143, ,611 23,618, ,242, ,741 23,737, banks 674, , , , customers 23,469, ,725 22,945, ,392, ,852 22,888, /12/08 30/09/08 Gross Value Net % Net Value Net % exposure adjustments exposure b/a exposure adjustments exposure b/a (a) (b) (a)-(b) (a) (b) (a)-(b) Cash loans Bad loans 621, , , , , , customers 621, , , , , , Watchlist loans 408,737 60, , ,929 36, , banks customers 408,496 60, , ,883 36, , Rescheduled loans 21,068 1,069 19, , , banks 15, , , , customers 5, , , , Past due loans 242,266 4, , ,812 18, , banks customers 242,264 4, , ,572 18, , Total Impaired loans 1,293, , , ,309, , , Performing loans 20,813,022 72,392 20,740, ,508,677 87,054 19,421, banks 970, ,837-1,242,716-1,242, customers (2) 19,842,185 72,392 19,769, ,265,961 87,054 18,178, Total cash loans 22,106, ,514 21,634, ,817, ,632 20,309, banks 986, , ,258, ,258, customers 21,119, ,736 20,648, ,558, ,985 19,050, Credit commitments Impaired 23,974 4,933 19, ,694 5,946 17, customers 23,974 4,933 19, ,694 5,946 17, Other loans 1,668,585 4,137 1,664, ,595,968 6,022 1,589, banks 56,870-56,870-69,870-69, customers 1,611,715 4,137 1,607, ,526,098 6,022 1,520, Total credit commitments 1,692,559 9,070 1,683, ,619,662 11,968 1,607, banks 56,870-56,870-69,870-69, customers 1,635,689 9,070 1,626, ,549,792 11,968 1,537, Total 23,799, ,584 23,317, ,437, ,600 21,916, banks 1,043, ,043, ,328, ,328, customers 22,755, ,806 22,274, ,108, ,953 20,588, (1) Net of debt securities classified as Loans & Receivables (L&R) (2) Including the fair value of loans to customers for which we opted for the so-called "Fair Value Option" (para. 9 IAS 39) - Assets Item 30 amounting to euro 753 thousand. 37

38 The portion of bad loans related to Liguria is equal to 36.6% of the aggregate, down compared to 40% of December and 51% of September 2008, also in relation to the relatively more contained impact of the economic crisis in this region compared to more industrialised areas of the country. Lombardy is the second region, with a share of 22.7%, followed by Piedmont and by Tuscany (12.2% and 8% respectively). BAD LOANS TO CUSTOMERS (1) - GEOGRAPHICAL DISTRIBUTION (2) (figures in thousands of euro) Situation as at 30/9/09 30/6/09 31/12/08 30/9/08 % % % % Liguria 286, % 270, % 248, % 337, % Lombardy 177, % 154, % 119, % 112, % Piedmont 95, % 84, % 71, % 69, % Tuscany 62, % 62, % 58, % 33, % Emilia Romagna 53, % 50, % 40, % 33, % Latium 30, % 28, % 26, % 25, % Sicily 18, % 16, % 15, % 15, % Veneto 18, % 16, % 11, % 5, % Apulia 12, % 11, % 10, % 10, % Sardinia 11, % 8, % 6, % 5, % Marches 8, % 8, % 7, % 7, % Umbria 5, % 4, % 4, % 4, % Valle d'aosta % % % 9 0.0% Total Italy 782, % 719, % 620, % 661, % Abroad 1, % 1, % 1, % 1, % Total 783, % 720, % 621, % 662, % (1) Gross of value adjustments and net of debt securities classified as L&R. (2) Figures per branch province. The bad loans/lending ratio stood at 3.6%, with inconsistent regional trends: the ratio in Liguria was recorded at 2.7%, on the increase compared to 2.4% in December, but on the decrease compared to 3.6% in September 2008; whilst in Lombardy it grew by 5.7%, compared to 4.1% in December and to 3.9% in September Piedmont registered the highest ratio (6.9%), on the increase both compared to December (5%) and to September 2008 (5.1%). BAD LOANS/LENDING RATIO (1) - GEOGRAPHICAL DISTRIBUTION (2) (Percentage values). 30/9/09 30/6/09 31/12/08 30/9/08 Piedmont 6.9% 5.9% 5.0% 5.1% Lombardy 5.7% 5.1% 4.1% 3.9% Marches 5.4% 5.3% 4.5% 4.6% Umbria 5.2% 4.9% 4.0% 5.0% Apulia 5.1% 4.6% 4.4% 4.4% Emilia Romagna 4.3% 4.1% 3.5% 3.2% Sardinia 3.6% 2.8% 2.6% 2.4% Tuscany 3.4% 3.4% 3.3% 1.9% Latium 3.4% 3.2% 3.0% 3.2% Sicily 3.0% 2.8% 2.6% 4.0% Liguria 2.7% 2.6% 2.4% 3.6% Valle d'aosta 2.1% 1.9% 0.1% 0.0% Veneto 1.6% 1.4% 1.0% 0.5% Total Italy 3.6% 3.3% 3.0% 3.4% Abroad 0.6% 0.5% 0.7% 0.6% Total 3.6% 3.3% 2.9% 3.4% (1) Gross of value adjustments and net of debt securities classified as L&R. (2) Figures per branch province. The breakdown by business segment showed a concentration of bad loans in non-financial businesses and personal businesses (Euro million) with a share of 69.2% (71.2% in December and 73.9% in September 2008). Building and public works represented the segment 38

39 with the highest share of bad loans (euro million, 18.1%), followed by wholesale and retail trade (euro million, 14.8%). Financial businesses represented 28.3% of the aggregate (25.8% in December and 23.4% in September 2008). BAD LOANS (1) - DISTRIBUTION BY BUSINESS SEGMENT (figures in thousands of euro) 30/09/09 30/06/09 31/12/08 30/9/08 % % % % Public Administration Financial businesses 13, % 12, % 12, % 12, % Non-financial businesses and personal businesses 541, % 501, % 442, % 489, % Building and public works 141, % 133, % 110, % 107, % Wholesale & retail trade, salvage and repairs 115, % 109, % 92, % 92, % Sales-related services 91, % 84, % 74, % 66, % Metal products 23, % 22, % 19, % 18, % Hotel and catering services 20, % 19, % 17, % 17, % Other 149, % 131, % 128, % 186, % Private social bodies 1, % 1, % 1, % 1, % Families 221, % 199, % 160, % 155, % Total residents 778, % 715, % 617, % 658, % Non residents 5, % 5, % 3, % 3, % Total 783, % 720, % 621, % 662, % (1) Gross of value adjustments and net of debt securities classified as L&R. The bad loans/loans ratio is equal to 3,6%, progressively increasing in the year for all the sectors concerned. In particular it increased to 3.4% for families (2.5% in December and September 2008) and 4.2% for non-financial companies and personal businesses (3.7% and 4.3% in December and September 2008 respectively). BAD LOANS/LENDING RATIO (1) - DISTRIBUTION BY BUSINESS SEGMENT (Percentage values) Situation as at 30/09/09 30/06/09 31/12/08 30/9/08 Public Administration Financial businesses 1.6% 1.2% 1.0% 2.2% Non-financial businesses and personal businesses 4.2% 4.0% 3.7% 4.3% - of which (2): Building and public works 6.4% 6.3% 5.3% 5.2% Wholesale & retail trade, salvage and repairs 5.7% 5.4% 4.5% 4.8% Hotel and catering services 3.2% 3.0% 2.6% 2.7% Sales-related services 2.3% 2.2% 2.1% 2.0% Energy goods 0.0% 0.0% 0.0% 0.0% Private social bodies 1.7% 1.7% 1.7% 1.6% Families 3.4% 3.0% 2.5% 2.5% Total residents 3.6% 3.3% 2.9% 3.4% Rest of the world 1.3% 1.4% 2.5% 2.9% Total 3.6% 3.3% 2.9% 3.4% (1) Gross of value adjustments and net of debt securities classified as L&R. (2) Main business segments in terms of overall credit exposure shown. Securities in portfolio amount to euro 7,678.8 million, up by 43.7% in the nine months and 41.3% in the twelve months, of which 81.7% consisted in debt securities; however, excluding the equity investment in Bank of Italy, posted under equities (see infra), this share goes up to more than 90%. Approximately 74% of the portfolio consists of investment grade securities. Debt securities, equal to euro 6,274.3 million, increased by 54.2% in the nine month period and by 55.8% on a YoY basis, due to the purchase of inflation linked government securities allocated in the AFS portfolio. Equities, at euro 1,026.4 million, increased by 12.6% against December and 6.1% against September. Equities included the equity investment in the Bank of Italy, accounted for at euro million; this figure results from a valuation at fair value - using shareholders equity as the most reliable proxy of fair value - performed on the basis of the balance sheet data of the Bank of Italy as at 31 December 2008 (last approved financial statements), in line with the accounting principle adopted for the preparation of the financial statements and the consolidated financial statements as at 31 December Shares in mutual funds amounted to euro million, up in the nine month period (+3.9%) and down in the twelve month period (-13.9%). As regards the breakdown, 68.6% of the portfolio was composed of securities available for sale (56.2% at the start of the year and 48.8% in September 2008). Securities held for trading accounted for 9.6% (12.1% at the start of the year and 26.8% in September 2008). 39

40 SECURITIES PORTFOLIO (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Debt securities 6,274,278 5,270,650 4,067,667 4,026, Held for trading 686, , ,229 1,400, Available for sale 4,126,046 3,075,130 1,977,338 1,538,350 Fair value 462, , , , Loans and Receivable 493, , , , Held to maturity 505, , ,144 99, Equities 1,026, , , , Held for trading 1,147 1,186 1,505 6, Available for sale 1,025, , , , Shares in collective investment schemes 378, , , , Held for trading 48,496 45,424 46,057 50, Available for sale 119, , , , Fair value 210, , , , Total 7,678,834 6,614,025 5,343,205 5,434, including: Held for trading 736, , ,791 1,457, Available for sale 5,270,371 4,168,194 3,001,637 2,652, Loans and Receivable 493, , , , Fair value 673, , , , Held to maturity 505, , ,144 99, The amendments made to international accounting principles IAS 39 and IFRS 7 in October and November 2008 allowed for new types of reclassifications, with the possibility of retroactive effectiveness to 1 July 2008 if carried out before 31 October Pursuant to said amendments, the Carige Group reclassified securities, effective 1 July and 1 October, for a total residual amount of euro 1,389.2 million as at 30 September 2009 (fair value at reclassification date), as detailed in the table below. RECLASSIFICATIONS OF FINANCIAL ASSETS (1) (figures in thousands of euro) from/to AFS HTM L&R TOTAL HFT 489, , ,943 1,079,737 AFS , ,415 TOTAL 489, , ,358 1,389,152 (1) Amounts net of accruals. In the absence of said reclassifications the Group would have recorded, as at 30 September 2009: greater write-downs totalling 33.2 million (decreased during the nine months by Euro 97.2 million compared to Euro million on 31 December 2008) that generated Euro 27.1 million of greater negative fairvalue reserves (down by Euro 56.4 million during the nine months); lower interest income pertaining to amortised cost for euro 11.4 million, of which euro 6.5 million relating to the nine months; greater negative reserves of shareholders equity of euro 4.8 million, down by euro 19.7 million compared with euro 24.5 million of 31 December These values are calculated before the respective taxes. The portfolio of debt securities reclassified in the AFS (Available For Sale, HTM (Held To Maturity) and L&R (Loans & Receivables) for a nominal value of euro 1,139.6 million has an effective interest rate of 5.61% with expected cash flows estimated at euro 1,713.1 million. In relation to the downturn in the financial markets and difficulties facing leading financial institutions, the accounting Bodies intervened to regulate market situations in which the prices of many financial instruments were affected by 40

41 strong illiquidity and the International Accounting Standards Board (IASB) issued a special application guide. In particular, this made it possible to evaluate certain financial instruments on the basis of the so-called level 1 of fair value (effective market quotes), level 2 (comparable approach) or level 3 (mark to model approach), however giving maximum priority to official prices available on active markets (effective market quotes) and, in their absence, the evaluation of assets and liabilities based on indicative quotes, or referring to similar assets and liabilities (comparable approach) and, finally, only residually, to evaluation techniques based on non-observable inputs and, therefore, more discretional (Markto-Model Approach). Shown below is a summary of the different levels of fair value used by the Group for the evaluation of its financial assets and liabilities as at 30 September 2009, in line with the action taken in preparing the consolidated financial statements for the year ended at 31 December 2008: - Effective market quotes Level 1 of Fair Value. The evaluation is carried out at the market price of said financial instrument subject to the evaluation, obtained on the basis of quotes expressed by an active market. The percentage of financial instruments valued with this method over the total of instruments at fair value for the Group equals 70.19% (63.69% as at 31 December 2008). - Evaluation Techniques (Comparable approach) Level 2 of Fair Value. The assessment is based on indicative evaluations of the financial instrument that are obtained from reliable info-providers or on prices determined by using an appropriate calculation method (pricing model) and observable market parameters, including therein credit spreads obtained from official quotes of instruments that are essentially similar in terms of risk factors. The percentage of financial instruments assessed using this method, out of all instruments evaluated at fair value for the Carige Group, stood at 28.91% (35.06% as at 31 December 2008). - Evaluation techniques (Mark-to-Model Approach) Level 3 of Fair Value. Evaluations are performed by using different inputs, not all obtained directly from observable market parameters and therefore involve estimates and assumptions by the evaluator. In particular, with this approach, different methodologies are used: with reference to the interest held in the Bank of Italy, the fair value is determined at an amount corresponding to the fraction of shareholders equity as at 31 December This evaluation is a significant approximation of the fair value of the investment; with reference to the evaluation of capitalisation policies, a calculation method (pricing model) has been used that is based, inter alia, on specific hypotheses regarding: - the development of future cash flows, conditioned by future events to which probabilities can be attributed, based on past experience or on the basis of behavioural assumptions; - the level of set input parameters not quoted on active markets, for whose estimate, however, information acquired from prices and spreads observed on the market are given preference. Finally, Level 3 of Fair Value was used for the same financial instruments present as at 31 December 2008, plus equity interest acquired during the quarter for credit collection. The percentage of instruments assessed using this methodology, out of all instruments evaluated at fair value for the Carige Group, stood at 0.90% (1.25% as at 31 December 2008). The table below shows a summary, for the Carige Group, of the values and respective percentages of the different levels of Fair Value used for the evaluation of the financial instruments classified in the HFT (Held For Trading), AFS (Available For Sale) and Fair Value Option (FVO) categories: 41

42 LEVELS OF FAIR VALUE USED (1) (figures in thousands of euro) Level 1 Level 2 Level 3 Countervalue % Countervalue % Countervalue % Financial assets 3,897, ,180, , Financial liabilities 460, , Derivatives , Total 4,358, ,795, , % on Total 62.26% 25.64% 12.11% % on Total net of the equity investment in Bank of Italy 70.19% 28.91% 0.90% (1) Net of accruals and some minor positions, which are not included in the scheme. As at 30 September 2009, the exposure of the Group to certain instruments that the marketplace now considers to be high-risk or involve more risk than previously thought amounts to about euro 250 million, equal to approximately 3.3% of the securities portfolio, concerns: - securities resulting from securitisation transactions (with the exclusion of CDOs Collateralised Debt Obligations), allocated to both the trading portfolio and to the portfolio of assets available for sale, for a total book value of approximately euro 62 million, (0.8% of the securities portfolio. It should be noted that such securitisation transactions do not include any exposure to subprime mortgages, and that 74% of said transactions is comprised of Junior, Mezzanine and Senior tranches of the securitisations of mortgages granted by the banks of the Group and originating from proprietary vehicles, included in the consolidation perimeter; - CDOs portfolio, for a book value of approximately euro 6.6 million (0.1% of the aggregate portfolio), comprised of synthetic securitisations which include CDS - Credit Default Swap, and by securitisations of securitisations with exposures to RMBS - Residential Mortgage-Backed Securities, CMBS - Commercial Mortgage-Backed Securities, ABS - Asset-Backed Securities, and by subprime positions with a book value of euro 0.3 million (less than 1 thousandth of the aggregate portfolio). It should be noted that 73% of the CDOs in the portfolio is above investment grade, while 67% of the total (determined at book value) has a rating equal or above AA ; - securities and derivatives related to leveraged finance transactions comprised of funded and unfunded securities. The former have a book value of euro million (equal to 1.6% of the aggregate portfolio) and 99.7% of these (equal to a nominal value of euro million) is structured in a protected/guaranteed format, with the hedging of the specific risk or, in any case, with the provision for the repayment at par at maturity. Unfunded securities are subdivided in credit and interest rate instruments; credit instruments have a notional amount of euro 15 million and a negative economic impact, net of value write-backs, for euro 0.5 million. Interest rate structured derivatives, on the other hand, against a notional amount of euro 25 million have a negative impact of roughly euro 1 million. As at 30 September 2009, valuation reserves relative to securities classified in the AFS (Available For Sale) category amounted to euro million (an increase of euro million compared to the positive balance of euro million at 31 December 2008) and composed for euro million of positive reserves (relating mainly to the valuation of the equity investment in the Bank of Italy (euro million) and for euro million by negative reserves. These refer to debt securities (mostly comprised of public, bank and corporate bonds with high credit standing) for euro 45.6 million and to equity and shares in collective investment schemes of leasing banking and insurance issuers (including Assicurazioni Generali SpA for euro 56.5 million and four bank securities for euro 18.2 million) for euro million. As regards the portion relative to equities, even though significant, that exceed quantitative impairment parameters defined by the model adopted by the Group (including a case with a negative reserve of euro 7.9 million which exceeds 80% of the decrease in fair value compared with the book value) the conditions of impairment were not deemed to exist following qualitative evaluations based on an analysis of the so-called fundamental aspects of the issuer that also took into consideration the economic results achieved in the first part of the current financial year as well as the performance in the months after the close of the half. 42

43 Hedging derivative assets amounted to Euro 73.8 million, on the increase compared to Euro 56.9 million in December (+29.7%) and to Euro 22.7 million in September The value of hedging derivative liabilities, equal to Euro million was greater than Euro million in December and Euro 25.5 million in September Revaluations amounting to euro 19.1 million and write-downs for euro 97.9 million were registered on hedging derivative contracts; taking into account the increase in the underlying assets for euro 81.1 million, the net result is positive for euro 2.3 million. ASSETS FROM HEDGING DERIVATIVES BY HEDGE TYPE (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Asset hedging derivatives - - 1, Fair value hedging - - 1, interest rates - - 1, Cash flow hedging General interest rate risk hedging Liability hedging derivatives 73,831 63,242 55,234 22, Fair value hedging 71,295 60,728 53,065 6, interest rates 71,295 60,728 53,065 6, Cash flow hedging General interest rate risk hedging 2,536 2,514 2,169 15, Total 73,831 63,242 56,922 22, LIABILITIES FROM HEDGING DERIVATIVES BY HEDGE TYPE (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Asset hedging derivatives 144,744 97,422 49,556 8,962 Fair value hedging 144,744 97,422 49,556 8,962 interest rates 144,744 97,422 49,556 8,962 Cash flow hedging General interest rate risk hedging Liability hedging derivatives 88,957 70,139 66,734 16, Fair value hedging , interest rates , other risks Cash flow hedging General interest rate risk hedging 88,957 70,139 65,891 3, Total 233, , ,290 25,541 The notional value of derivative contracts was equal to Euro 7,465.4 million, greater than the value in December (+11.6%) and September 2008 (+25.8%). Financial derivatives represent 97.6% of the aggregate. 43

44 NOTIONAL VALUES OF DERIVATIVE CONTRACTS (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Financial derivatives 7,284,805 6,894,616 6,472,194 5,704, futures , forward agreements 300, , , , swap 5,953,045 5,350,206 4,548,596 4,244, options purchased 909, ,264 1,028, , others 120, , , , Credit derivatives 180, , , , tror 161 1,972 6,060 6, cds 180, , , , TOTAL 7,465,420 7,070,329 6,687,347 5,935, Trading derivative contracts amount to euro million, down compared with December 2008 (-12.3%) and up against September 2008 (+8.7%). Revaluations for euro 37.2 million, write-downs for euro 58.1 million and net trading losses for euro 1.3 million were recorded on trading derivative contracts; consequently, the net negative result amounted to euro 22.2 million. TRADING DERIVATIVES (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Positive countervalues 58,420 55,568 64,503 66, Financial derivatives 57,507 52,176 52,864 56, forward agreements 9,679 9,314 11,098 19, swap 19,404 20,276 19,178 12, options purchased 28,424 22,586 22,587 24, others Credit derivatives 913 3,392 11,639 10, cds 913 3,392 11,639 10, TOTAL 58,420 55,568 64,503 66, Negative countervalues 98, , ,470 77, Financial derivatives 95, , ,505 76, forward agreements 4,336 6,559 11,516 9, swap 88,650 93,576 97,229 60, issued options 2,021 2,719 2,760 6, Credit derivatives 3,497 3,070 2,965 1, tror cds 3,497 3,067 2,952 1, TOTAL 98, , ,470 77, Overall, the net income on derivative contracts is negative for euro 19.9 million. 44

45 NET INCOME ON DERIVATIVE CONTRACTS AS AT 30/9/2009 (figures in thousands of euro) Revaluations Write-downs Net profit Net income on trading 1. Trading contracts 37,229-58,118-1,264-22, Financial derivatives 36,388-45, , Credit derivatives ,179-1,799-13,137 Revaluations Write-downs Changes in underlying Net income from hedging 2. Hedging contracts 19,081-97,943 81,114 2, Asset hedging 3,072-94,737 92, Liability hedging 16,009-3,206-11,005 1,798 TOTAL 56, ,061 79,850-19,901 45

46 ECONOMIC RESULTS The first nine months of 2009 closed with a net profit of euro million, against euro 163 million in the same period in 2008 (+0.2%). The former Intesa Sanpaolo and UniCredit branches contributed to this result; they became part of the Group perimeter on 10 March and 1 December 2008 respectively. INCOME STATEMENT (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/09 31/12/08 30/9/08 absolute % 10 - INTEREST INCOME AND SIMILAR REVENUES 895, ,249 1,491,426 1,087, , INTEREST EXPENSES AND SIMILAR CHARGES -341, , , , , NET INTEREST INCOME 554, , , ,886-32, COMMISSION INCOME 227, , , ,106 14, COMMISSION EXPENSES -25,463-16,941-38,578-28,724 3, NET COMMISSIONS 202, , , ,382 17, DIVIDENDS AND OTHER SIMILAR REVENUES 10,302 9,825 14,818 12,445-2, NET INCOME FROM TRADING ACTIVITIES 12,459 4,035-62,976-54,924 67, NET INCOME FROM HEDGING ACTIVITIES 2,252 2, , PROFIT (LOSS) ON DISPOSAL OR REPURCHASE OF: 23,961 18,065 15,916 15,879 8, a) loans 1,823 1,080 3,902 2, b) available-for-sale financial assets 6,837 1,577 10,214 10,266-3, d) financial liabilities 15,301 15,408 1,800 3,188 12, NET VALUE ADJUSTMENT ON FINANCIAL ASSETS DESIGNATED AT FAIR VALUE -1,063 1, ,471-16, GROSS OPERATING INCOME 804, ,699 1,030, ,521 43, NET VALUE ADJUSTMENTS DUE TO IMPAIRMENT OF: -77,346-56, ,795-80,294 2, a) loans -60,139-39,613-76,929-75,336 15, b) available-for-sale financial assets -17,257-16,651-28,041-4,205-13,052 d) other financial assets , NET INCOME FROM FINANCIAL MANAGEMENT 726, , , ,227 46, NET PREMIUMS 1,135, , , , , BALANCE OF OTHER EXPENSES/REVENUES FROM INSURANCE MANAGEMENT -1,146, , , , , NET INCOME FROM FINANCIAL AND INSURANCE MANAGEMENT 714, , , ,995 55, ADMINISTRATIVE COSTS: -484, , , ,142-34, a) staff costs (1) -296, , , ,540-29, b) other administrative costs (1) -188, , , ,602-4, NET PROVISIONS FOR RISKS AND CHARGES -3,778-2,773-2,245 3,322-7, DEPRECIATION OF TANGIBLE ASSETS -17,560-11,570-21,320-14,904-2, AMORTIZATION OF INTANGIBLE ASSETS -15,175-9,607-17,387-12,209-2, OTHER OPERATING EXPENSES AND REVENUES 50,620 31,612 56,577 47,406 3, OPERATING COSTS -470, , , ,527-43, PROFIT (LOSS) FROM EQUITY INVESTMENTS 6,495 3,583 5,422 2,686 3, PROFIT (LOSS) FROM DISPOSAL OF INVESTMENTS OPERATING PROFIT (LOSS) FROM ORDINARY ACTIVITIES BEFORE TAXES 251, , , ,176 15, INCOME TAXES FOR THE PERIOD -85,133-53,895-95,844-67,060-18, PROFIT (LOSS) FROM ORDINARY ACTIVITIES AFTER TAXES 165, , , ,116-2, PROFIT (LOSS) FOR THE PERIOD 165, , , ,116-2, MINORITY INTERESTS 2,560 2,836 7,399 5,068-2, PROFIT (LOSS) FOR THE PERIOD ATTRIBUTABLE TO THE PARENT BANK 163, , , , (1) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". Figures as at September 2008 have been adequately reclassified to allow a homogeneous comparison among the different periods. 46

47 INCOME STATEMENT - QUARTERLY RESULTS (figures in thousands of euro) 3 rd quarter rd quarter 2008 CHANGE 30/6/09 30/9/09 30/9/08 CHANGE 10 - INTEREST INCOME AND SIMILAR REVENUES 895,886 1,087, , , , , , INTEREST EXPENSES AND SIMILAR CHARGES -341, , ,998-92, ,483 87, , NET INTEREST INCOME 554, ,886-32, , ,159-35, , COMMISSION INCOME 227, ,106 14,481 80,592 72,129 8, , COMMISSION EXPENSES -25,463-28,724 3,261-8,522-10,348 1,826-16, NET COMMISSIONS 202, ,382 17,742 72,070 61,781 10, , DIVIDENDS AND OTHER SIMILAR REVENUES 10,302 12,445-2, , NET INCOME FROM TRADING ACTIVITIES 12,459-54,924 67,383 8,424-8,759 17,183 4, NET INCOME FROM HEDGING ACTIVITIES 2, , , PROFIT (LOSS) ON DISPOSAL OR REPURCHASE OF: 23,961 15,879 8,082 5,896 2,536 3,360 18,065 a) loans 1,823 2, ,080 b) available-for-sale financial assets 6,837 10,266-3,429 5,260 1,290 3,970 1,577 d) financial liabilities 15,301 3,188 12, , NET VALUE ADJUSTMENT ON FINANCIAL ASSETS DESIGNATED AT FAIR VALUE -1,063 15,471-16,534-2,186 15,350-17,536 1, GROSS OPERATING INCOME 804, ,521 43, , ,182-22, , NET VALUE ADJUSTMENTS DUE TO IMPAIRMENT OF: -77,346-80,294 2,948-21,213-27,033 5,820-56,133 a) loans -60,139-75,336 15,197-20,526-24,303 3,777-39,613 b) available-for-sale financial assets -17,257-4,205-13, ,521 1,915-16,651 d) other financial assets NET INCOME FROM FINANCIAL MANAGEMENT 726, ,227 46, , ,149-16, , NET PREMIUMS 1,135, , , , , , , BALANCE OF OTHER EXPENSES/REVENUES FROM INSURANCE MANAGEMENT -1,146, , , , , , , NET INCOME FROM FINANCIAL AND INSURANCE MANAGEMENT 714, ,995 55, , ,970-16, , ADMINISTRATIVE COSTS: -484, ,142-34, , ,530 5, ,807 a) staff costs (1) -296, ,540-29,738-91,874-89,522-2, ,404 b) other administrative costs (1) -188, ,602-4,666-58,865-67,008 8, , NET PROVISIONS FOR RISKS AND CHARGES -3,778 3,322-7,100-1,005 2,932-3,937-2, DEPRECIATION OF TANGIBLE ASSETS -17,560-14,904-2,656-5,990-5, , AMORTIZATION OF INTANGIBLE ASSETS -15,175-12,209-2,966-5,568-4, , OTHER OPERATING EXPENSES AND REVENUES 50,620 47,406 3,214 19,008 15,294 3,714 31, OPERATING COSTS -470, ,527-43, , ,175 3, , PROFIT (LOSS) FROM EQUITY INVESTMENTS 6,495 2,686 3,809 2,912-2,912 3, PROFIT (LOSS) FROM DISPOSAL OF INVESTMENTS OPERATING PROFIT (LOSS) FROM ORDINARY ACTIVITIES BEFORE TAXES 251, ,176 15,863 82,600 91,820-9, , INCOME TAXES FOR THE PERIOD -85,133-67,060-18,073-31,238-37,771 6,533-53, PROFIT (LOSS) FROM ORDINARY ACTIVITIES AFTER TAXES 165, ,116-2,210 51,362 54,049-2, , PROFIT (LOSS) FOR THE PERIOD 165, ,116-2,210 51,362 54,049-2, , MINORITY INTERESTS 2,560 5,068-2, ,973-2,249 2, PROFIT (LOSS) FOR THE PERIOD ATTRIBUTABLE TO THE PARENT BANK 163, , ,638 52, ,708 (1) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". Figures for the third quarter of 2008 have been adequately reclassified to allow a homogeneous comparison among the different periods. The net interest income stood at euro 554 million, down by 5.6%, as a result of the reduction in spreads, against a good increase in traded volumes. Compared with the third quarter of 2008, interest income fell by -17.6% to euro million and interest expenses by % to euro million. INTEREST INCOME (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Financial assets held for trading 17,098 13,865 62,302 42,727-25, Available-for-sale financial assets (1) 79,817 50,387 91,276 67,192 12, Financial assets held to maturity 12,919 9,303 6,348 2,213 10,706 Loans to banks 21,415 17,192 61,328 46,969-25, Loans to customers (2) 744, ,086 1,212, , , Financial assets sold and not cancelled (2) 19,672 12,804 56,029 42,764-23, Other intangible ,781 1, TOTAL INTEREST INCOME 895, ,249 1,491,426 1,087, ,

48 INTEREST EXPENSES (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Amounts owed to banks 8,984 6,920 61,923 53,582-44, Amounts owed to customers 92,518 66, , ,164-32, Securities in issue (2) 202, , , ,432-45, Financial liabilities designated at fair value 5,130 2,367 15,660 11,719-6, Financial liabilities corresponding to assets sold and not cancelled (2) 10,067 8,125 54,323 42,307-32, Other liabilities ,213 3,068-2, Hedging derivatives 22,253 15,918 28,056 16,565 5, TOTAL INTEREST EXPENSES 341, , , , , (1) In the financial statements as at 31 December 2008 euro 3,405 thousand have been reported in the interest income regarding financial assets designated at fair value and not in the sub-item relative to the available-for-sale financial assets. Figures have now been adequately adjusted. (2) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has sent, inter alia, a note containing some modifications relative to the tables of the explanatory notes. In particular, a specific item "Securities in issue" has been introduced in table C.2.2 "Financial liabilities corresponding to financial assets sold and not cancelled" of part E "Information on risks and the related hedging policies". This item has to gather in the financial statements all the securities issued by the vehicle companies consolidated on a line-by-line basis corresponding to assets sold and cancelled from the financial statements of the "originating" bank. In light of such new provision the Bank has decided to record also interest income on the mortgages transferred to the consolidated vehicle company in "interest income on assets sold and not cancelled" and not in "interest income on loans to customers", and the interest expenses on securities issued by the vehicle company in "interest expenses on financial liabilities corresponding to assets sold and not cancelled" and not in "interest expenses on securities in issue". The comparison periods have been adequately reclassified to allow a homogeneous comparison. Following some recent clarifications provided by the Bank of Italy, interest income on financial assets sold and not cancelled related to securitisation transactions for which no "derecognition" has taken place has been reclassified to loans to customers. Net commissions, at euro million, registered a 9.6% increase, essentially due to the rise in commission income (euro million; +6.8%) and in particular, the 'other services' component, which included growth in commissions for syndicated loans. COMMISSION INCOME (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Guarantees issued 7,855 5,014 10,405 7, Management, dealing and consultancy services: 66,379 43,082 95,744 72,360-5, Financial instruments trading Currency trading 2,458 1,427 3,524 2, Asset management 26,156 17,187 45,714 35,614-9, Securities custody and administration 3,016 1,822 3,148 2, Custodian bank 2,405 1,422 3,665 2, Placement of securities 9,039 5,834 13,271 10,721-1, Collection of orders 10,050 6,767 10,283 6,947 3, Distribution of third-party services 12,576 8,357 15,957 11,246 1, asset management insurance products 1, ,235 1, other products 11,120 7,377 13,650 9,713 1, Collection and payment services 48,172 30,420 62,615 45,953 2, Servicing for securitizations , Factoring services 1, , Other services 103,428 67, ,658 85,864 17, TOTAL COMMISSION INCOME 227, , , ,106 14,

49 COMMISSION EXPENSES (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Guarantees received Management and intermediation services 2,107 1,548 3,068 2, Financial instruments trading Asset management Securities custody and administration 1, ,134 1, Financial instruments placement Door-to-door sale of securities, financial products and services Collection and payment services 13,885 8,882 21,182 15,805-1, Other services 9,100 6,227 13,603 10, TOTAL COMMISSION EXPENSES 25,463 16,941 38,578 28,724-3, Dividends and similar revenues amounted to euro 10.3 million, against euro 12.4 million in September Net income from financial items (captions 80, 90, 100 b/c/d, and 110) was positive at euro 35.8 million, against a negative value of euro 25.6 million in September In particular, a better net performance in trading activities (euro 12.5 million against euro million last year) contributed to this result as did, to a lesser extent, profits from the disposal or repurchase of financial liabilities, totalling euro 15.3 million (euro 3.2 million in September 2008). INCOME FROM TRADING ACTIVITIES (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Debt securities 36,483 26,152-63,283-54,579 91,062 Equities & collective investment schemes 1, ,207-10,649 12,170 Total equities, debt securities & collective investment schemes 38,004 27,065-69,490-65, ,232 Financial derivatives -9,016-8,625-2,264 6,911-15,927 Credit derivatives -13,137-9,520 8,094 7,990-21,127 Currency differences ,941-7,890 7,897 Other financial assets/liabilities from trading -3,399-4,746 4,625 3,293-6,692 NET INCOME FROM TRADING ACTIVITIES 12,459 4,035-62,976-54,924 67,383 Gross operating income reached euro million, an increase of 5.7%. Net value adjustments due to impairment to loans and other financial items amounted to euro 77.3 million, down against the figure recorded in the same period in 2008 (euro 80.3 million); this item included net value adjustments on loans that totalled euro 60.1 million, down compared with the first nine months of They derived from adjustments of euro million and write-backs totalling euro 55.4 million; these items incorporated the positive effects of the adoption of the statistical LGD (Loss Given Default) model, developed internally for the evaluation of insignificant bad loan positions (for more details see the section dedicated to impaired loans in Intermediation activities ). The adjustments on financial assets available for sale (impairment) amounted to euro 17.3 million, including euro 14.4 million on structured debt securities in default and from the automobile sector, and euro 2.9 million on equities. The results for the first nine months of 2009 are 49

50 NET VALUE ADJUSTMENTS TO LOANS AND OTHER FINANCIAL ITEMS (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Loans to banks Loans to customers 60,031 39,502 76,759 75,336-15, Credit commitments (other financial transactions) , Available-for-sale financial assets 17,257 16,651 28,041 4,205 13,052 NET VALUE ADJUSTMENTS TO LOANS AND OTHER FINANCIAL ITEMS 77,346 56, ,795 80,294-2, Taking into consideration the contribution from insurance operations, net income from financial and insurance operations increased by 8.5% to euro 715 million. Operating costs amounted to euro million, an increase of 10.3% compared with the first nine months of In particular, administrative costs totalled euro million, an increase of 7.6%: staff costs rose by 11.2% to euro million and other administrative costs by 2.5% to euro million. Staff costs included the allocation to the Supplementary Pension Fund (SPF) estimated based on a discount rate of 4.75%, considered to be consistent with the market trend in government securities. At the end of the year the assessments by the appointed actuaries will take into account the data gathered and the technical, demographic, economic and financial assumptions as at that date. Net provisions for risks and charges amounted to euro 3.8 million against recoveries in value of euro 3.3 million in September Net adjustments to tangible and intangible assets amounted to euro 17.6 million and euro 15.2 million respectively, both increasing in comparison with September 2008 (17.8% and 24.3% respectively). OPERATING COSTS (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Staff costs (1) 296, , , ,540 29, Other administrative costs (1) 188, , , ,602 4, general costs 150, , , ,653 2, indirect taxes 38,241 25,699 50,480 35,949 2, Net provisions for risks and charges 3,778 2,773 2,245-3,322 7,100 Amortization and depreciation on: 32,735 21,177 38,707 27,113 5, intangible fixed assets 15,175 9,607 17,387 12,209 2, tangible fixed assets 17,560 11,570 21,320 14,904 2, Other operating expenses and revenues - 50,620-31,612-56,577-47,406-3, TOTAL OPERATING COSTS 470, , , ,527 43, (1) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". Figures relating to September 2008 were modified by reclassifying an amount equal to euro 564 thousand from sub-item "b) other administrative expenses" to sub-item "a) staff costs" in order to allow a homogeneous comparison among different periods. Other net operating revenues increased by 6.8% to euro 50.6 million, compared to the first nine months of

51 OTHER OPERATING REVENUES AND EXPENSES (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/ /9/08 absolute % Lease income and rent 14,638 9,598 18,464 14, Charges to third parties: 33,705 22,290 43,676 32, recovery of taxes 32,724 21,635 42,195 31,680 1, customer insurance premiums ,481 1, Other revenues 16,550 9,336 23,914 16, Total other revenues 64,893 41,224 86,054 63,173 1, Operating costs on financial leases ,027-1,748 1, Ordinary maintenance costs on investment property - 3,732-2,015-3,783-2, Expenses for improvement of third parties assets , Other expenses - 9,424-6,816-22,342-10, Total other expenses - 14,273-9,612-29,477-15,767 1, TOTAL NET REVENUES 50,620 31,612 56,577 47,406 3, Also taking into consideration profits equity investments of euro 6.5 million and losses on the disposal of investments totalling euro 11 thousand (euro 22 thousand in September 2008), operating income amounted to euro 251 million, 6.7% higher than in the first nine months of Income tax provisions stood at euro 85.1 million, a sharp increase compared to the euro 67.1 million September 2008, which benefitted from the positive non-recurring effects, amounting to euro 30 million, attributed principally to the application of substitute tax to off-balance sheet differences (as set forth by the provisions of Law no. 244/2007, which allowed for the realignment between statutory and tax values of goodwill and instrumental Group properties) which involved the use of deferred tax liabilities duly set aside. Taking into account this increase and the profit attributable to minority interests, at euro 2.6 million (euro 5.1 million in September 2008), net profit amounted to euro million, slightly up on the euro 163 million recorded in September Also taking into consideration the profit components charged directly to shareholders equity, the statement of comprehensive income showed a net income of euro million, a considerable increase on the euro 25.6 million of the first nine months of This increase was due to the general improvement in the reserves relating to securities available for sale (see the paragraph Intermediation activities in the section on financial assets). DIVIDENDS DISTRIBUTED BY THE PARENT BANK BANCA CARIGE Over the course of the financial year, in accordance with the Shareholders Meeting resolution of 29 April 2009, the Parent Bank distributed euro 223,468,934.24, corresponding to the net profit achieved in the 2008 financial year (euro 223,468,916.00) and the reserve for dividends on own shares (euro 18.24) as follows: DISTRIBUTION OF NET PROFIT Net profit 223,468, Reserve for dividends on own shares Total 223,468, Allocation to the legal reserve 22,346, Allocation to the extraordinary reserve 54,411, Dividend of ordinary shares (0.08 per share) 129,279, Dividend of savings shares (0.1 per share) 17,430, Dividend payment took place on 7 May 2009 (coupon detachment date: 4 May 2009), in compliance with the express recommendation of Borsa Italiana SpA to the companies issuing shares listed on the Stock Exchange. 51

52 INSURANCE ACTIVITIES PREMIUMS-RESERVES-ECONOMIC RESULT (figures in thousands of euro) Change % 9/09 9/09 30/09/09 30/06/09 31/12/08 30/09/08 12/08 9/08 Net premiums 1,135, , , , Non-life insurance 359, , , , recognised gross premiums (+) 396, , , , premiums ceded to reinsurers (-) 27,464 17,764 67,265 21, variations (+/-) to premium reserve gross balances -5,458-25,799 13,979 2,920 variations (-/+) to premium reserves charged on reinsurers -3,452-3, , Life insurance 775, , , ,035 recognised gross premiums (+) 780, , , ,479 premiums ceded to reinsurers (-) 5,402 5,124 10,222 6, Technical reserves 3,047,281 2,804,509 2,292,606 2,139, Non-life insurance 945, , , , premium reserves 234, , , , accident reserves 710, , , , other reserves Life insurance 2,101,289 1,856,726 1,356,563 1,215, mathematical reserves 2,106,593 1,905,390 1,395,850 1,198, reserves for amounts payable 8,745 5,352 6,040 4, other reserves -14,049-54,016-45,327 13, Technical reserves charged on reinsurers 179, , , , Non-life insurance 89,818 86,888 79,876 66, premium reserves 12,089 11,821 12,735 7, accident reserves 77,729 75,067 67,141 58, other reserves Life insurance 90,038 87,914 91,527 92, mathematical reserves 88,073 89,206 93,153 91, reserves for amounts payable 3,333 2,040 2,351 1, other reserves -1,368-3,332-3, Balance of the insurance management -11,742-3,540-17,120-21, Premiums excluding reinsurance 1,135, , , , Net variations to technical reserves -718, , , ,222 Claims incurred and settled during the period -336, , , , Other insurance revenues and expenses -91,471-63, , , Net premiums from insurance activities amounted to euro 1,135.1 million, up by 81.1% compared with September 2008; in detail, net premiums from the non-life insurance segment fell by 5.8% to euro million, while those from the life insurance segment increased from euro 245 to million to euro million. This growth was due to the increase in the total premiums related to traditional products sold through the bank channel. Technical reserves stood at euro 3,047.3 million, up 32.9% compared with December 2008 and 42.4% on September 2008; the change mainly concerned the life insurance segment, with an increase of 54.9% (up from euro 1,215.8 to euro 2,101.3 million in the nine months) while the nonlife insurance segment rose by 1.1% (from euro to euro 946 million). Technical reserves charged on reinsurers (euro million) rose slightly compared with December 2008 (+4.9%) and increased compared with September 2008 (+12.8%). The balance of insurance operations increased from euro to euro million; more specifically, net premiums rose by 81.1% to euro 1,135.1 million, claims in the period fell by 5.7% to euro million, the net change in technical reserves stood at euro million (euro million in September 2008) and net charges from insurance operations stood at euro 91.5 million compared with euro million recorded in September The economic result of Group Insurance Companies for the period, also taking into consideration non-technical items, was positive for euro 2.9 million compared with a loss of euro 15.4 million in the same period in

53 TRANSACTIONS WITH RELATED PARTIES The Group maintains relations with Banca Carige shareholders who are able to exercise a significant influence, subsidiaries and other related parties regulated under market conditions. Please note that in the first nine months, no transactions were concluded with related parties subject to public disclosure; in fact, the transactions completed during the period fall within the ordinary operations of the Group and do not possess the relevance requirements as regards the impact on the financial statements. As at 30 September 2009, asset and liability transactions (with the exception of directors and statutory auditors fees, which are published annually in the Explanatory Notes to the Consolidated Financial Statements) were as follows: RELATIONS WITH SHAREHOLDERS WHO EXERCISE A SIGNIFICANT INFLUENCE AND WITH INVESTEE COMPANIES (1) (figures in thousands of euro) Assets Liabilities Guarantees Revenues Expenses Dividends (2) (3) and commitments Carige shareholders who exercise a significant influence 4, ,321 Subsidiaries outside the area of consolidation Companies subject to significant influence 14,607 14, ,118 - TOTAL 18,941 14, ,329 76,321 (1) Relations with subsidiaries included in the area of consolidation were not taken into account. (2) Dividends collected by companies subject to significant influence netted off in the consolidation process were not shown. (3) Dividends distributed by Banca Carige. RELATIONS WITH OTHER RELATED PARTIES (figures in thousands of euro) Assets Liabilities Guarantees Revenues Expenses Purchase of assets Insurance Indemnities and commitments and services premiums and insurance redemptions 65,657 19,422 17,865 2, ,657 19,422 17,865 2, Other related parties are defined as: - executives with strategic responsibility for the entity and its parent bank; this refers to those who have the power and responsibility, directly or indirectly, for the management and control of the Parent Bank s activities, including the Directors, the Statutory Auditors, the Managing Director or the General Manager, the Deputy General Managers and the Central Managers; - close relatives of one of the subjects referred to in the previous point; this refers to persons that can be expected to influence, or be influenced by, the interested party in their relations with the Bank and therefore, by way of example, may include the common-law spouse and persons dependent upon the interested party or upon the common-law spouse; - parties controlled by, jointly controlled by or subject to the significant influence of one of the entities pursuant to the previous points or in which said entities hold, directly or indirectly, a significant portion of the voting rights. Overall, the share of the total of relations with related parties was moderate, as shown in the following table: 53

54 WEIGHT OF TRANSACTIONS WITH OTHER RELATED PARTIES AS AT 30/9/2009 (figures in thousands of euro) Amount of transactions with related parties Amount of balance sheet item % weight Assets Item 70 - Loans to customers 84,226 21,644, % Other asset items ,763, % Liabilities Item 20 - Amounts owed to customers 34,313 14,042, % Other liability Items (1) 9 16,568, % Income statement Item 10 - Interest income 2, , % Item 20 - Interest expenses , % Item Balance of other expenses/revenues from insurance management (+/-) (7,989) (1,146,833) 0.7% Other positive Items in the income statement 584 1,468, % Other negative Items in the income statement (2) , % (1) The weight is calculated on the other liability items, except for those referred to the shareholders' equity. (2) The weight is calculated on the other negative items, except for taxes and profit attributed to minority interests. EQUITY INVESTMENTS of 2008, due to the effect of the increase in the shareholders equity of the companies Autostrada dei Fiori SpA and Recina Servizi SpA. Equity investments stood at euro 61 million, up compared with the euro 55.1 million at the end ANNUAL CHANGES IN EQUITY INVESTMENTS (figures in thousands of euro) 30/9/09 30/6/09 31/12/08 30/9/08 A. Opening balance 55,067 55,067 56,256 56,256 B. Additions 6,042 3, B.1 Acquisitions B.2 Write-backs B.3 Revaluations B.4 Other changes 6,042 3, C. Decreases , C1. Sales C2. Value adjustments C3. Other changes , D. Closing balance 61,045 58,122 55,067 56,680 OWN SHARES, CASH FLOW STATEMENT AND SHAREHOLDERS EQUITY At the end of the third quarter of 2009, and similar to the situation in December and September 2008, Banca Carige held an essentially insignificant number of own shares (less than euro 500). During the first nine months, operating assets generated liquidity amounting to euro million. In particular, management generated a positive flow for euro million, financial assets absorbed liquidity totalling euro 2,118.1 million, and financial liabilities generated liquidity amounting to euro 1,360.3 million. Liquidity absorbed by investing activities amounted to euro 69 million, and that absorbed by funding activity totalled euro million. In the first nine months of 2009, net liquidity of euro 47.4 million was absorbed. The consolidated shareholders equity and the net consolidated profit pertaining to the Parent Bank are obtained from the net shareholders equity and profit for the year of Banca Carige through the following changes: 54

55 RECONCILIATION STATEMENT OF BANCA CARIGE SHAREHOLDERS' EQUITY AND INCOME AND CONSOLIDATED FIGURES (figures in thousands of euro) Shareholders' equity Income statement Balance as at 30/9/ Banca Carige 3,885, ,238 Variations on book value -2,047 32,637 Value adjustments to allocated gains -7, Share options survey - subsidiaries -12, Amortised goodwill (previous accounting periods) -43,485 - Dividends distributed by subsidiaries and written off -49,237-49,237 Dividends distributed by associated companies and written off Other -1,904 2,460 Consolidated balance as at 30/9/2009 3,768, ,346 RESOURCE MANAGEMENT The Carige Group s distribution system is split into three major categories of channels: traditional, remote and mobile. The system of traditional channels is made up of branches, private and corporate consultancy districts, affluent advisors and small business advisors. The number of branches remained unchanged from the beginning of the year, at 643 (of which 253 located in Liguria and 390 outside Liguria) while the increase of 40 units compared with September 2008 was due to the acquisition of branches from the UniCredit Group. In 2009 there were four transfers; three carried out by the Parent Bank (from the branch located in the Genoa s Eastern Market to Avegno (GE), from Cernobbio (CO) to Saronno (VA), and from Piove di Sacco (PD) to Ancona) and one from Banca Cesare Ponti, which opened the new Genoa Branch, following the transfer of the Milan Branch in Piazza Cadorna. An organisational change also took place during the financial year that led to the formation of the Private Banking Department. During this change, the service access thresholds were also reviewed, with a redefinition of the perimeter of private and affluent channels: the number of private advisors fell to 112 (139 in December and 136 in September 2008) while the number of affluent advisors increased to 307 (153 in December and 152 in September 2008). The financial consultancy service (corporate), composed of 132 advisors (132 in December and 126 in September 2008), is dedicated to business customers, and the small business service is structured into a network of 276 advisors, an increase compared with the 177 and 176 in December and September Within the remote channels, the number of Bancacontinua branches remained unchanged at 14, while ATM branches totalled 759 (757 in December and 713 in September 2008). Contracts relative to on-line services - internet and call centre - exceeded 180 thousand, an increase over both the nine and twelve-month periods. The Group also has a network of 274 insurance agencies located throughout the entire national territory, which place bank products (261 in December and 269 in September 2008). 55

56 BRANCH NETWORK A) TRADITIONAL CHANNELS 30/9/09 30/6/09 31/12/08 30/9/08 number % number % number % number % NORTHWEST Liguria Genoa Savona Imperia La Spezia Lombardy Piedmont Valle d'aosta NORTHEAST Veneto Emilia Romagna CENTRE Tuscany Latium Marches Umbria SOUTH AND ISLANDS Apulia Sicily Sardinia ABROAD: Nice (France) TOTAL NUMBER OF BRANCHES /9/09 30/6/09 31/12/08 30/9/08 Private consultants Corporate consultants Affluent consultants Small business consultants TOTAL CONSULTANTS B) REMOTE CHANNELS 30/9/09 30/6/09 31/12/08 30/9/08 ATM - Bancomat Self-service "Bancacontinua" branches On line services (1) 180, , , ,434 (1) Number of Internet banking and Call center contracts. C) MOBILE CHANNELS 30/9/09 30/6/09 31/12/08 30/9/08 Insurance agencies (2) (2) Agents of Group insurance subsidiaries distributing banking products. At the end of September 2009, Group personnel totalled 5,881 units (5,906 in December and 5,635 in September 2008). Bank staff amounted to 5,492 units, down compared with 5,523 units in December 2008, due to the effect of 31 voluntary redundancies; by contrast, with respect to the 5,264 units registered in September 2008, there was an increase due essentially to the joining of employees from the forty branches acquired from the UniCredit Group. Executives represented 1.2% of the aggregate and managers 25%, while the rest of the personnel accounted for 73.8% of the aggregate. The number of the employees operating on the market was equal to 70.5% of the total (68.1% in December and 66.6% in September 2008, respectively). Insurance personnel amounted to 389 units (383 and 371 as at 31 December and 30 September 2008 respectively). 56

57 PERSONNEL Number of bank employees 30/9/09 30/6/09 31/12/08 30/9/08 number % number % number % number % Grade Executives Managers 1, , , , Other employees 4, , , , TOTAL 5, , , , Activity Head offices 1, , , , Branches 3, , , , Insurance personnel TOTAL (banking and insurance) 5,881 5,888 5,906 5,635 RESULTS BY ECONOMIC BUSINESS SECTOR IFRS 8 Operating Segments has become effective as from 1 January 2009 replacing completely IAS 14 Segment Reporting. The new regulation focuses on the definition of the reporting segments according to the so-called management approach, i.e. required identification of operating segments based on internal reports that were regularly reviewed by the company's "chief operating decision maker" in order to make strategic decisions: therefore, the distinction between the primary and secondary sector disappears. With reference to the Carige Group, the business model has a twofold importance: territorial, given that the sales network is broken down into geographical areas, Liguria and outside Liguria (hereinafter Extra-Liguria); that for the customer segment, considering that the organisational and operational structure provides for specific service approaches (in terms of products, prices and infrastructures) aimed at the different types of customer. In compliance with what was provided by the management approach, the company chose as a model of reference for segment reporting the territorial reorganisation that broke down the results and the activities among the following operating segments: - Liguria : operating customers at the branches of the Parent Bank located in said geographical area, together with the results of Cassa di Risparmio di Savona, situated prevalently in said area; - Extra-Liguria : operating customers at the branch banks of the Parent Bank located in the rest of the regions, together with the results of subsidiary banks located in these geographic areas (Cassa di Risparmio di Carrara, Banca del Monte di Lucca and Banca Cesare Ponti); - Other operating sectors : includes residual customers and the other Group companies that perform asset management, insurance (life and non-life segments), financial and instrumental activities; - Netting-off and unallocated items : residual sector explicitly provided for by legislation to give evidence of the intra-group netting-off and reconciliation items compared with the accounting figures. This report shall be integrated with a summary representation by customer segment of the income statement and balance-sheet values. In order to allow a significant time-based comparison, the data for preceding periods are re-worked in line with current disclosure approaches. At the end of the third quarter of 2009 the income statement and balance sheet results of the geographical operating sectors were as follows: - the Liguria network recorded a gross operating income of euro million, an increase of 2.6% compared with the first nine months of 2008; net of value adjustments, income from financial operations amounted to euro million; operating costs fell by 1.7% compared with September 2008 and stood at euro million; and cost income amounted to 43.7% (at the end of the nine months of 2008 this figure amounted to 45.6%). With regard to volumes, loans to customers stood at euro 9,361 million, up by 57

58 16.5% over 30 September 2008; amounts owed to customers totalled euro 6,770 million (+26.6% compared with 30 September 2008); securities in issue and financial liabilities designated at fair value, amounting to euro 4,313 million were essentially stable compared with 30 September 2008 (+1.6%). The Financial Intermediation Activities (FIA) amounted to euro 22,278 million (+2%); - the Extra Liguria network which was expanded during 2008 with the addition of 119 branches acquired from Intesa SanPaolo (March 2008) and UniCredit (end of 2008) recorded an increase in gross operating income of 12.5% compared with the third quarter of 2008 at euro and income from financial operations of euro million (+8.9% compared with September 2008). Operating costs, amounting to euro million, rose by 15.5% compared with the first nine months of 2008; cost income stood at 59.8% (58.2% as at 30 September 2008). With regard to the trend in lending volumes, loans to customers increased by 10.6% compared with 30 September 2008 at euro 10,374 million, amounts owed to customers totalled euro 6,081 million (+18.0% over September 2008), and securities in issue stood at euro 2,197 million, up by 11.3%. Financial Intermediation Activities (FIA) amounted to euro 15,844 million, an increase of 6.8% on 30 September 2008; - the other operating sectors recorded a profit from ordinary activities of euro 40.4 million, essentially in line with the figure for the first nine months of 2008 (-2.2%); with respect to the total figures for the Group, this sector incorporates almost 40% of the securities in issue and financial liabilities designated at fair value, amounting to euro 3,766 million. The FIA amounted to euro 8,582 million (+21% compared with 30 September 2008). 58

59 Business geographic areas (figures in thousands of euro) Liguria Extra-Liguria Other operating segments Netting-off and other items TOTAL Gross operating income (1) 9 months , , ,867-43, ,340 1 st half , , ,506-43, ,159 year , , ,389-51,021 1,013,470 9 months , , ,724-48, ,289 Net income from financial and insurance management (2) 9 months , , ,423-37, ,478 1 st half , , ,885-39, ,584 year , , ,233-45, ,224 9 months , , ,354-45, ,703 Operating costs 9 months , , ,030-6, ,439 1 st half , ,290-43,874-3, ,145 year , , ,892-7, ,477 9 months , ,153-83,061-4, ,527 Profit (Loss) from ordinary activities 9 months ,342 77,479 40,393-43, ,039 1 st half ,803 31,908 87,011-43, ,439 year , ,702 41,341-53, ,747 9 months ,604 81,933 41,293-50, ,176 Cost income (%) 9 months st half year months Net interbank 30/09/ , , ,513 30/06/ ,715,534-1,153, ,198 31/12/ ,361, , ,365 30/09/ ,273, , ,771 Loans to customers 30/09/2009 9,361,274 10,373,510 2,188, ,981 21,644,936 30/06/2009 9,388,292 10,247,959 2,186, ,724 21,603,385 31/12/2008 8,727,942 10,016,230 2,619, ,392 20,916,355 30/09/2008 8,038,427 9,377,524 1,991,767-96,484 19,311,234 Amounts owed to customers (a) 30/09/2009 6,769,571 6,080,625 1,643, ,567 14,042,180 30/06/2009 6,549,765 6,029,283 1,304, ,313 13,412,317 31/12/2008 5,996,811 5,606, , ,304 12,005,439 30/09/2008 5,348,665 5,153, , ,091 10,766,712 Securities in issue and financial liabilities designated at fair value (3) (b) 30/09/2009 4,313,492 2,197,325 3,765, ,777 9,443,666 30/06/2009 4,373,528 2,207,224 4,538, ,349 10,299,153 31/12/2008 4,270,054 2,081,721 4,593, ,472 10,158,641 30/09/2008 4,247,627 1,973,918 3,928, ,605 9,709,217 Other financial assets (c) 30/09/ ,194,861 7,566,496 3,173, ,850 21,132,629 30/06/ ,166,467 7,532,268 2,994, ,818 20,919,953 31/12/ ,328,512 7,771,784 2,513, ,585 20,960,268 30/09/ ,248,502 7,711,409 2,319, ,155 21,905,132 Financial Intermediation Activities (FIA) (d= a+b+c) 30/09/ ,277,923 15,844,446 8,582,300-2,086,194 44,618,475 30/06/ ,089,760 15,768,775 8,837,368-2,064,480 44,631,423 31/12/ ,595,377 15,459,916 7,892,416-1,823,361 43,124,348 30/09/ ,844,794 14,839,153 7,092,965-1,395,851 42,381,061 (1) Including income from insurance management (2) Including profits from equity investments and disposal of investments. (3) Carige Vita Nuova liabilities, designated at fair value and relating to products for which risk is borne by the insured, have not been included in this table. 59

60 Business geographic areas (% on total) Liguria Extra-Liguria Other operating segments Netting-off and other items TOTAL Gross operating income (1) 9 months st half year months Net income from financial and insurance management (2) 9 months st half year months Operating costs 9 months st half year months Profit (Loss) from ordinary activities 9 months st half year months Loans to customers 30/09/ /06/ /12/ /09/ Amounts owed to customers 30/09/ /06/ /12/ /09/ Securities in issue and financial liabilities designated at fair value (3) 30/09/ /06/ /12/ /09/ Other financial assets 30/09/ /06/ /12/ /09/ Financial Intermediation Activities (FIA) 30/09/ /06/ /12/ /09/ (1) Including income from insurance management (2) Including profits from equity investments and disposal of investments. (3) Carige Vita Nuova liabilities, designated at fair value and relating to products for which risk is borne by the insured, have not been included in this table. 60

61 With regard to the customer segments, the increase in gross operating income was mainly concentrated in the Corporate segment (euro million, +17% compared with the first nine months of 2008), primarily as a result of the quantity of lending volumes. The Private and Affluent and the Retail segments, with gross operating income of euro 159 million and euro million respectively, recorded a more contained increase given that, despite the increase in volumes, the income from direct deposits reflected the reduction in spreads. The income from financial and insurance operations for the Private and Affluent segment amounted to euro million, +6.4% on September The Corporate segment generated income of euro million, +8.5% on September 2008; and the Retail segment with an income of euro million, remained in line with the figures as at September The rise in operating costs was mainly concentrated in the Retail segment (euro million, +11.5% on September 2008); the Private and Affluent segment recorded operating costs of euro 92.2 million, whereas the Corporate segment ended the first nine months of 2009 with a figure of euro 33.1 million. With regard to volumes, loans to customers increased at Group level, including almost 80% driven by the Corporate segment, with a value at the end of September 2009 of euro 10,316 million (47.7% of the Group total), +22% compared with 30 September Within the direct deposits, the growth was driven by the amounts owed to customers: the figure for the Private and Affluent segment stood at euro 5,768 million (41.1% of the Group total, +41.9% compared with 30 September 2008), whereas the Retail segment amounted to euro 5,516 million (39.3% of the Group total), +31.3% compared with 30 September Indirect deposits of ordinary customers showed a reduction, compared with 30 September 2008, mainly concentrated in the Private and Affluent segment (euro 13,539 million, -8.1%), which holds 64.1% of the aggregate at Group level. The FIA amounted to euro 24,057 million for the Private and Affluent segment (53.9% of the Group total), euro 2,461 million for the Corporate segment, and euro 10,026 for the Retail segment. 61

62 Customer segments (figures in thousands of euro) Private and Affluent Corporate Retail Total customer segments Total financial statements Gross operating income (1) 9 months , , , , ,340 1 st half , , , , ,159 year , , , ,037 1,013,470 9 months , , , , ,289 Net income from financial and insurance management (2) 9 months , , , , ,478 1 st half ,306 84, , , ,584 year , , , , ,224 9 months , , , , ,703 Operating costs 9 months ,151-33, , , ,439 1 st half ,310-24, , , ,145 year ,701-44, , , ,477 9 months ,310-32, , , ,527 Profit (Loss) from ordinary activities 9 months ,536 97,960 59, , ,039 1 st half ,996 59,941 34, , ,439 year , , , , ,747 9 months ,867 88,348 80, , ,176 Number of customers 9 months ,273 17, ,487 1,197,666 1,238,255 1 st half ,403 17, ,030 1,145,985 1,184,345 year ,894 17,038 1,020,777 1,224,709 1,263,443 9 months ,387 16, ,511 1,134,417 1,170,830 Profit per customer (figures in euro) 9 months , st half , year , months , Loans to customers 30/09/ ,122 10,316,307 8,270,274 19,099,703 21,644,936 30/06/ ,393 10,100,481 8,266,335 18,869,209 21,603,385 31/12/ ,185 9,011,419 8,358,329 17,890,933 20,916,355 30/09/ ,505 8,453,700 7,967,544 16,945,749 19,311,234 Amounts owed to customers (a) 30/09/2009 5,768,321 1,511,809 5,515,828 12,795,958 14,042,180 30/06/2009 5,449,364 1,412,763 5,259,591 12,121,718 13,412,317 31/12/2008 4,804,862 1,243,551 4,566,903 10,615,316 12,005,439 30/09/2008 4,064,780 1,119,905 4,201,648 9,386,333 10,766,712 Securities in issue and financial liabilities designated at fair value (3) (b) 30/09/2009 4,748, ,445 1,457,167 6,310,566 9,443,666 30/06/2009 4,813, ,168 1,468,421 6,397,828 10,299,153 31/12/2008 4,771, ,829 1,393,390 6,289,393 10,158,641 30/09/2008 4,579, ,462 1,354,503 6,055,254 9,709,217 Other financial assets (c) 30/09/ ,539, ,842 3,053,296 17,437,447 21,132,629 30/06/ ,439, ,638 3,120,552 17,444,463 20,919,953 31/12/ ,925, ,844 3,211,973 17,991,065 20,960,268 30/09/ ,731, ,888 3,268,659 18,862,406 21,905,132 Financial Intermediation Activities (FIA) (d = a + b + c) 30/09/ ,056,583 2,461,096 10,026,291 36,543,970 44,618,475 30/06/ ,701,876 2,413,569 9,848,564 35,964,009 44,631,423 31/12/ ,501,284 2,222,224 9,172,266 34,895,774 43,124,348 30/09/ ,375,928 2,103,255 8,824,810 34,303,993 42,381,061 (1) Including income from insurance management (2) Including profits from equity investments and disposal of investments. (3) Carige Vita Nuova liabilities, designated at fair value and relating to products for which risk is borne by the insured, are not included in this table. 62

63 RISK MANAGEMENT A. General aspects In the Carige Group, any policies related to the assumption of risks are set by the Board of Directors of the Parent Bank at the moment of the preparation of strategic planning and the annual budget. The Parent Bank performs orientation and supervisory functions as regards all risks, in particular by managing, in an integrated context, the Pillar 1 and Pillar 2 risks, in accordance with the provisions contained in the Supervisory Instructions of the Bank of Italy (Circ. No. dated 27 December 2006 as amended). The Group Banks operate within specific limits of independence and avail themselves of their own first level control structures. The different risk categories are monitored by the competent functions, Research and Management Control, Risk Management and Credit Monitoring, and the outcome is subject to periodic reporting to the Board of Directors, Executive Management, Asset & Liability Management Committee and to the ICAAP (Internal Capital Adequacy Assessment Process) Committee. The analyses are supported not only by regulatory models, but by more advanced methodologies which have made it possible, over time, to expand the range of risks monitored and to improve the assessment of the capital adequacy, from both a regulatory and an economic perspective. The Second Pillar regulations provide that the Banks, also through the use of proprietary procedures, assess their current and future capital adequacy, expanding the range of risks to be taken into account compared with the First Pillar. Carige carried out an activity aimed at identifying the risks to which the Group is exposed, with regards to its own operations and reference markets; therefore, the risk map and relative evaluation methods were defined quantitative if measurement methods are present, qualitative if relating to organisational controls tracing management activities, mostly already in place, to an organic framework. Besides credit, market and operational risks, the concentration (both the single name and geosectorial components), interest rate, liquidity, reputational and strategic risks deriving from securitisations and residual risks were included in the perimeter of the analysis for ICAAP purposes. With reference to the methods used, internal models for the quantification of the credit, market and interest rate risks were used, together with regulatory models for the operating and concentration risk. The analyses related to the remaining risks were performed though the use of specific scorecards aimed at identifying, with qualitative techniques, the potential level of risk and the supervision measures introduced. As regards capitalisation aspects and the hedging of existing risk with capital means, the Group confirms its compliance with the expected thresholds for all ratios of the Bank of Italy currently in force and calculated on the basis of Instructions for the completion of reports on the regulatory capital and prudential coefficients (Bank of Italy circular no. 155 of 18 December 1991), and new provisions of prudential supervision for banks (Bank of Italy circular no. 263 of 27 December 2006). The Group shows Total Capital Ratio (10.04%) and Tier 1 Ratio indicators (7.70%) considerably higher than the supervisory limits, and an excess capital of euro million, and it expects, also in the remainder of the financial year, to maintain capitalisation levels adequately above the Supervisory limits (Regulatory capital, including the Tier 3 subordinated loan, is estimated at euro 2,002.1 million). The analyses of the impact on capital of the second pillar regulations confirm the solid capitalisation of the Group: more specifically, the requirements on the risks not taken into account by the first pillar regulations appear to be more than offset by the savings on capital generated by the application of more advanced methods on the credit and market risks. In addition, as regards ICAAP, with specific reference to the level of capital, proprietary methods were set in order to measure, from a prudential prospective, certain assets which the first pillar regulations do not take into account, imposing their sterilisation/deduction in regulatory capital: this refers specifically to controlling interests in insurance companies, to those in the Bank of Italy and, finally, to the portion of goodwill deriving from acquisitions made in recent years, deemed for all intents and purposes to be tangible asset'. This setup allows the implicit higher capitalisation of the Carige Group to fully 63

64 emerge, with the reaching of significant levels in terms of the total capital and tier 1 ratios. B. Risks Credit and counterparty risk The risk measurement, management and control process is carried out through the activities of: - Credit Risk Management, focused on the governance of credit activities, with the careful monitoring of the performance of risk indicators from rating sources (PD, LGD and EAD) on the performing portfolio and of the trends in poor quality loans; - an operational nature, aimed at the careful management of credit provided. In 2008, the Parent Bank introduced an operational credit monitoring tool, allowing the various control activity aspects to be combined with risk indicators developed according to Internal Rating Based methodology, with the aim of improving operating efficiency with management ever more consistent with customer risk profiles. The use of said tool was extended to the subsidiaries Cassa di Risparmio di Savona and Banca Ponti, with the extension to the other two Group Banks expected by the end of the year. Over the course of 2009, the Parent Bank continued the activities for the fine-tuning and implementation of internal rating models, which were related to the Corporate, Small- and Medium-Size Enterprises and Retail segments, as well as the LGD and EAD models. In addition, information relating to the rating of Large Corporate counterparties, as already done for the retail and Corporate segments, was added to the process of determining the decisionmaking procedure regarding loan practices. The Group, in line with the overall goal of a wider and more extensive use of rating system basic parameters in managerial and operational practice, adopted the statistical LGD model (Loss Given Default) for the evaluation of insignificant bad loan positions, developed inhouse on the basis of discounted historical flows of collections and costs, both direct and indirect, linked to the recovery process. Application of said methodology permits positive results of an operating nature, in light of greater standardisation of processes and a higher level of consistency in the evaluations of insignificant bad loan positions. 64

65 BREAKDOWN OF CONSOLIDATED REGULATORY CAPITAL - (figures in thousands of euro) Situation as at 30/9/09 30/6/09 31/12/08 30/9/08 (1) (2) (1) (3) Tier 1 capital: positive elements (a) 3,378,944 3,378,944 3,297,610 3,107,106 Share capital 1,803,832 1,803,832 1,801,053 1,800,734 Reserves 361, , , ,870 Additional paid-in capital 1,018,043 1,018,043 1,018,289 1,018,427 Profit for the period 35,885 35,885 83,435 53,075 Innovative capital instruments (h) 159, , ,900 - Tier 1 capital: negative elements (b) 1,656,279 1,656,279 1,662,941 1,566,556 Goodwill 1,593,367 1,593,367 1,604,306 1,514,137 Other negative elements 62,912 62,912 58,635 52,419 Prudential filters for regulatory capital (c) -135, , ,290-24,543 Deductions (d) 51,023 51,023 14,213 19,361 Total Tier 1 capital (e = a-b+c-d) 1,535,926 1,535,921 1,511,166 1,496,646 Core Tier 1 Capital (e-h) 1,376,026 1,376,021 1,351,266 1,496,646 Tier 2 capital (f) 789, , , ,979 Deductions (g) 349, , , ,436 Regulatory capital (e+f-g) 1,976,605 1,976,600 1,984,995 1,816,189 Tier 3 capital 97,175 97,175 99,675 99,675 Tier 3 calculable portion 25,502 22,129 31,493 33,997 Regulatory capital including Tier 3 2,002,107 1,998,729 2,016,488 1,850,186 Tier 3 subordinated loans not calculable in the Tier 3 71,673 75,046 68,182 65,678 Figures rounded up to thousands of euro (1) Figures regarding the regulatory capital and the capital requirements as at 30/9/2009 and 30/9/2008 result from accounting and management estimates, as the official consolidated figures (Information form "1") are provided only in June and December. (2) Figures relating to the regulatory capital and the capital requirements as at 30/6/2009 are the official figures and therefore they differ from the management data shown in the half-yearly financial report. (3) Capital ratios as at 30/9/2008 incorporate the estimates following securities reclassification carried out in compliance with changes to IAS 39 approved on 13/10/2008 by IASB and transposed by the European Commission on 15/10/2008. CONSOLIDATED REGULATORY CAPITAL AND SOLVENCY RATIOS (figures in thousands of euro) Situation as at 30/9/09 30/6/09 31/12/08 30/9/08 (1) (2) (1) (3) Regulatory capital Core Tier 1 Capital 1,376,026 1,376,021 1,351,266 1,496,646 Tier 1 capital 1,535,926 1,535,921 1,511,166 1,496,646 Weighted assets Credit risk 17,775,820 17,423,567 16,819,000 16,139,713 Market risk 446, , , ,188 Operational risk 1,726,625 1,726,625 1,726,625 1,580,238 Other prudential requirements Total weighted assets 19,948,910 19,537,608 19,096,988 18,315,138 Capital requirements Credit risk 1,422,066 1,393,885 1,345,520 1,291,177 Market risk 35,717 30,993 44,109 47,615 Operational risk 138, , , ,419 Other prudential requirements Total 1,595,913 1,563,009 1,527,759 1,465,211 Subordinated loans covering market risks Surplus capital 406, , , ,975 Solvency ratios (%) Tier 1 capital/credit risk weighted assets 8.64% 8.82% 8.98% 9.27% Regulatory capital/credit risk weighted assets 11.12% 11.34% 11.80% 11.25% Core Tier 1/Total Risk-Weighted Assets 6.90% 7.04% 7.08% 8.17% Tier 1 capital/total weighted assets 7.70% 7.86% 7.91% 8.17% Regulatory capital including Tier 3 capital/total weighted assets 10.04% 10.23% 10.56% 10.10% Figures rounded up to thousands of euro (1) Figures regarding the regulatory capital and the capital requirements as at 30/9/2009 and 30/9/2008 result from accounting and management estimates, as the official consolidated figures (Information form "1") are provided only in June and December. (2) Figures relating to the regulatory capital and the capital requirements as at 30/6/2009 are the official figures and therefore they differ from the management data shown in the half-year report. (3) Capital ratios as at 30/9/2008 incorporate the estimates following securities reclassification carried out in compliance with changes to IAS 39 approved on 13/10/2008 by IASB and transposed by the European Commission on 15/10/

66 Market risk This is measured on the securities and derivatives portfolio through the daily determination of the Value at Risk (VaR) in accordance with the Montecarlo approach, with a confidence interval of 99% and a holding period of ten days. The analysis of the VaR on the securities and derivatives has been supplemented by the daily monitoring of the profitability profiles with the calculation of the accrued interests, of profits and losses, and of the capital gains/losses recognised on the financial instruments held in the portfolio. The profitability determined in this way is constantly compared with the scenarios set out in the budget. The foreign exchange risk and the gamma and vega risk on options are calculated with the standard Bank of Italy approach. The financial portfolio management policy is characterised by a conservative profile, with limited use of speculative derivative instruments, securitisations and structured instruments. During the course of the first nine months, the VaR of the financial portfolio (also including instruments classified as AFS, HFT and L&R) fluctuated from a low of euro 22.2 million to a high of euro 38.0 million, with an average of euro 29.9 million. Operational risk The basic Bank of Italy approach is used, which provides for capital absorption equal to 15% of the average gross operating income of the last three years. In order to be able to evolve towards more advanced methodologies, the Group has participated in the DIPO (Database Italiano Perdite Operative, or Italian Database of Operating Losses), since its inception following an initiative of ABI. Furthermore, specifically as regards the risks connected with a potential breakdown of the IT system, the Group has set out a Business Continuity and Disaster recovery plan aimed at the identification of the critical processes and of the strategies to minimise the risks and the associated economic consequences, so as to be able to guarantee a quick restoration of operations. Interest rate risk The analysis of the interest rate risk is performed, on a monthly basis, with Gap analysis (with the three methodologies of incremental gap, incremental beta gap and shifted beta gap), Duration analysis and Sensitivity analysis techniques. In addition, at consolidated level, the Parent Bank periodically monitors its exposure to interest rate risk, in application of the standard Supervisory model. Concentration risk This risk is quantified through use of the Herfindhal index in accordance with the procedures provided by the Bank of Italy, as regards the single name application; in relation to the geo-sectorial concentration risk, reference was made to the method proposed by the ABI. The measurements made show a limited exposure, consistent with the retail nature of the Group. Liquidity risk Many analyses are performed aimed at assessing the financial balance in both the treasury items and at structural level. The short-term liquidity risk is monitored by making daily analyses of the net treasury position, the liquidity reserves, and the daily transactions at Group level. Analysis of the overall situation is carried out through the calculation of liquidity indicators (ratio and absolute value) and preparation of a maturity ladder. The ratios measure the solidity of the treasury situation according to decreasing safety margins: in fact, they compare the value of the net financial position with the liquidity reserves on demand, securities that can be liquidated in the short-term, and strategic securities that can be liquidated. The Board of Directors has established limits on cumulative gaps involving different time gaps of the maturity ladder. The medium/long-term liquidity risk is analysed by monitoring both asset and liability items maturing in the future and comparing them with the growth objectives provided under strategic planning. These analyses mean that a monthly evaluation can be made on the consistency of structural liquidity requirements (mainly bond funding on the internal and international markets) with Group development plans. In addition, for the purposes of more effective control of structural liquidity risk, gap ratio indicators have been introduced on maturities beyond one year. The objective is to maintain a sufficiently balanced structural liquidity profile, placing restrictions on the possibility of financing medium/long-term assets with short-term liabilities, in line with the approach of limiting maturity transformation. 66

67 Finally, the Board of Directors approved a Contingency Plan which sets out and describes the intervention strategies and processes in stress and crisis situations, the reference organisational structure, risk indicators with the relative trigger points and the associated calculation methods. The Group s liquidity situation as at 30 September 2009 continued to be positive with around euro 3.5 billion of available liquidity reserves against a net financial position in debit of around euro 700 million. Reputational risk, strategic risk, risk on securitisations and residual risk The analysis of the risk is performed through the use of specific scorecards which assess both the risk exposure as well as the control processes and the existing mitigation instruments. This analysis did not register any criticalities and conversely, made it possible to further refine certain controls in place. C. Risks of the insurance sector The activities of the Group insurance companies are subject to three separate risk categories which result from the specific nature of the activities carried out and from the fact that entrepreneurial activities are generically being carried out and the fact that the Group also operates in the financial market context as an institutional investor. Specifically, there are: insurance risks, which are generated from the specific activities of the insurer, which acts as an intermediary able to determine an assignment and a subsequent reduction of the risk, through the professional centralised management of the risks; financial risks, generated by the management of the investment portfolios of the Companies, comprised of real estate properties, securities, receivables of different types and other liquid assets; operational risks, or possible losses, including missed opportunities, originating from deficiencies and/or inadequate performances of processes and/or control systems, due to both internal and external reasons. Insurance risks result from the fact that insurance policies are characterised by the nonfinancial risk that an uncertain event may occur. The uncertainty concerns the likelihood, timing and the seriousness of the occurrence of that event. Three sub-categories may be identified: assumed risk, reserve risk and reinsurance risk. Assumed risk is linked to the underwriting of insurance policies, for which actuarial models are used to determine pricing needs and monitor claims. In addition, underwriting guidelines are issued along with assumption rules and limits for each individual risk category. As regards the reserve risk, which represents the possibility that the actual amounts of claims and settlements to be paid would exceed the book value of the insurance liabilities, comprised of amounts registered under reserve; the Company constantly monitors the development in the reserves related to claims occurred but not yet paid and the changes in said reserves. For this purpose, independent actuaries are appointed to apply special actuarial methods. With regard to reinsurance risks, after the definition of self-retention levels, arrangements are made to underwrite cover contracts for the main business lines, with leading market counterparts only, in order to mitigate the risk of insolvency. Financial risks affecting companies may be broken down into credit risks, liquidity risks and market risks. The companies manage the credit risk level through a careful and appropriate counterpart selection policy. Credit risks are inherent in loans to customers, receivables from reinsurers, in securities and other financial instruments including derivative contracts. Loans to customers are managed through the direct collection carried out by the intermediaries, the payments of which, made on a decadal basis, are subject to careful supervision by the central and peripheral structures with the purpose of limiting the risk of insolvency. As regards receivables from reinsurers, the counterparties are constantly monitored and the exposure limits are reviewed annually, in compliance with the reinsurance policy outlined by Management, in order to verify the credit standing of the reinsurer and any potential need to carry out write-downs. With regard to securities and other financial instruments, the Boards of Directors of the Companies defined the limits of investment as regards the individual issuer based on the nature 67

68 and on the rating of the counterparty and on the type of instruments purchased. Finally, as regards derivative instrument transactions, the Insurance Companies operate in compliance with the provisions of the Supervisory Body and in accordance with the resolutions of the individual Boards of Directors. Derivative contracts for hedging and for the effective management of investments are stipulated with counterparties of high standing and involve financial instruments with a high degree of liquidity. In any case, the Insurance Companies do not take any proprietary positions, except for the derivatives implicit in the structured financial instruments and for the derivatives with exclusively defensive purposes that may be connected with the unit or index linked policies marketed by Carige Vita Nuova. The company manages and minimises the liquidity risk on the short-term through careful management of the incoming cash flows (premiums and other amounts collected) linking them to the outgoing cash flows (settlements and other payments), whereas for the long-term management an ALM (Asset Liability Management) system is being implemented, which will allow a comparative analysis between the incoming flows from investments and the expected maturities of the liability commitments (at the current state of play the incoming cash flow component has been completed while the part relating to the outgoing cash flows is at the implementation phase). The Insurance Companies control the market risk through sensitivity analysis and stress testing, also conducting impairment tests for the purpose of identifying, where it may be objectively determined, the need for of value adjustments. As regards specifically the activities of Carige Vita Nuova, in some cases there is a direct link between investments and obligations towards the insured; in addition, certain types of Life insurance policies are subject to the minimum guaranteed interest rate risk; said risk is monitored through specific Asset-Liability Management (ALM) models. For the management of operational risks, the Risk Management function has been implemented, with the definition of an operational information collection tool (database) in which the company risks subject to monitoring are assessed. They are attributed to different risk areas and company processes, and in addition, assigned a risk owner. 68

69 THE PARENT BANK As regards the activity performed over the period by the Parent bank Banca Carige SpA, please refer to the Parent Bank s interim report, presented at the end of the consolidated interim financial statements. In this context, in order to maintain a balanced distribution of maturities, subsidiary banks issued bonds fully subscribed by the Parent Bank. This set of choices, non-influential at consolidated level, shapes the trend in both direct and indirect deposits for subsidiary banks, markedly of assets under custody, with impacts also on the corresponding income statement items. BANK SUBSIDIARIES With Law 262/2005 the obligation to draw up an information statement according to the criteria set by Consob was introduced, also for bank bonds. The Parent Bank decided to be the only bond issuer, leaving only the placement activity to the other banks of the Group. 69

70 The Financial Intermediation Activities (FIA) of Cassa di Risparmio di Savona SpA, at euro 2,867.3 million, increased by 1.7% compared with December 2008 (by 0.2% over September 2008). Direct deposits showed an increase of 2.3% in the nine months (+5.3% in twelve months), amounting to euro 1,185 million. Excluding bonds issued fully subscribed by the Parent Bank, at euro million, and including those issued by the Parent Bank and placed with customers of the subsidiary, at euro million, direct deposits amounted to euro 1,386.8 million (+7.5% and +12.4% in nine and twelve months respectively). Short-term deposits, standing at euro million, showed an increase of 11.5% over the end of the year and were up 17.2% on September The medium/long-term component, equal to euro million, fell by 18.2% over nine months and by 19.5% over twelve months. Indirect deposits increased by 1.3% over the nine months to euro 1,682.3 million (a reduction of -3.1% on September 2008); more specifically, assets under management amounted to euro 612 million (+4.8% and - 3.1% respectively over nine and twelve months), assets under custody stood at euro 1,070.3 million (-0.7% and -3.1% over nine and twelve months). Excluding bonds issued by the Parent Bank and placed with customers of Cassa di Risparmio di Savona, indirect deposits amounted to euro 1,335.1 million (-3.5% and - 10% respectively over nine and twelve months ). Loans to customers totalled euro 1,167.9 million (+3.3% and +8.9% over nine and twelve months respectively). The gross bad loans/lending ratio amounted to 1.7% (1.6% as at December and September 2008). The securities portfolio totalled euro million, a 73% increase over December and more than doubling over twelve months. The income statement showed a net profit of euro 10.6 million, down by 30% compared with September, mainly due to the reduction in the intermediation margins; the cost/income ratio increased from 51.7% to 64.9%. The interest margin fell by 18.1%, to euro 31 million. Net commissions fell by 1.2% to euro 15 million and net income from trading activities moved from a loss of euro 0.3 million to a profit of euro 0.7 million. Gross operating income, at euro 47.1 million, decreased by 13%. As at 30 September 2009, net write-backs due to impairment to loans and other financial items were recorded totalling euro 38 thousand (euro 4.3 thousand as at September 2008). Operating costs amounted to euro 30.6 million, a 9.1% increase. This item, excluding the other net operating income, at euro 2.7 million, amounted to euro 33.3 million, an increase of 7.3%. Profit from ordinary activities before taxes amounted to euro 16.5 million, 24.5% less than the euro 21.9 million of September After income taxes amounting to euro 5.9 million, the profit for the year totalled euro 10.6 million, recording a 30% decrease with respect to the first nine months of CASSA DI RISPARMIO DI SAVONA (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 BALANCE SHEET Total assets 1,512,985 1,523,149 1,462,936 1,436, Direct deposits (A) 1,184,973 1,219,315 1,158,780 1,125, Indirect deposits (B) 1,682,299 1,651,206 1,661,261 1,736, Assets under management 611, , , , Assets in custody 1,070,323 1,068,748 1,077,527 1,104, Financial Intermediation Activities (FIA) (A+B) 2,867,272 2,870,521 2,820,041 2,861, Loans to customers (1) 1,167,867 1,144,106 1,130,425 1,072, Securities portfolio 189, , ,504 91, Capital and reserves 174, , , , INCOME STATEMENT Gross operating income 47,098 32,822 76,793 54, Net income from financial management 47,060 34,040 72,470 49, Operating profit from ordinary activities before taxes 16,498 13,965 33,640 21, Profit for the period 10,596 8,924 23,620 15, RESOURCES Number of branches Staff (1) Before value adjustments. 70

71 The Financial Intermediation Activities (FIA) on behalf of the customers of Banca del Monte di Lucca SpA amounted to euro 1,119 million (+3% in nine months and +19.4% in twelve months). Within the FIA, direct deposits totalled euro million (+0.9% and +30.3% in nine and twelve months respectively) while indirect deposits amounted to euro million (+7.3% and +2.3% over December and September 2008). Excluding bonds issues fully subscribed by the Parent Bank, at euro million, and including those issued by the Parent Bank and placed with customers of the subsidiary, at euro 80.8 million, direct deposits would come to euro million (+3.9% and +5.7% in nine and twelve months respectively). Short-term deposits, at euro million, showed an increase of 10.7% in nine months and were up by 14.6% over twelve months. The medium/long-term component, equal to euro million, fell by 7.6% against December, but rose by 52.1% over September Within indirect deposits, assets under management amounted to euro 80.1 million (+7.8% over nine months and down by 8.5% over twelve months), while assets under custody totalled euro million (+7.2% and +5.7% respectively); excluding bonds issued by the Parent Bank and placed with the customers of Banca del Monte di Lucca, indirect deposits amounted to euro million (+2.5% and - 4.7% in nine and twelve months respectively). Loans to customers, amounting to euro million, grew by 5.5% over nine months and by 9.5% over twelve months. The gross bad loans/lending ratio stood at 4.4% (higher than the 3.3% in December and September 2008). The securities portfolio amounted to euro 6.1 million, euro 4.5 as at December and euro 1.7 as at September The income statement showed a net profit of euro 2.7 million, down by 51.1% compared with the first nine months of 2008, mainly due to the reduction in the intermediation margins and the increase in operating costs; the cost/income ratio increased over the period from 48.3% to 62%. The interest margin fell by 17%, to euro 16.7 million. Net commissions rose by 5.2%, standing at euro 6 million. In total, the gross operating income decreased by 12%, to euro 22.9 million. Net adjustments due to impairment to loans and other financial items amounted to euro 4.1 million (euro 4.2 million as at 30 September 2008). Operating costs increased by 13.2%, to euro 14.2 million. In particular, staff costs rose by 5.7%, reaching euro 8.7 million, while other administrative costs increased by 17.5% to euro 6.4 million. Profit from ordinary activities before taxes amounted to euro 4.5 million, 51.1% less compared with the euro 9.3 million of September After income taxes amounting to euro 1.9 million, the profit for the year totalled euro 2.7 million, recording a 51.1% decrease with respect to September BANCA DEL MONTE DI LUCCA (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 BALANCE SHEET Total assets 881, , , , Direct deposits (A) 745, , , , Indirect deposits (B) 373, , , , Assets under management 80,089 74,279 74,288 87, Assets in custody 293, , , , Financial Intermediation Activities (FIA) (A+B) 1,119,015 1,111,396 1,086, , Loans to customers (1) 818, , , , Securities portfolio 6,068 2,712 4,499 1, Capital and reserves 40,313 40,325 39,669 39, INCOME STATEMENT Gross operating income 22,885 15,467 35,621 26, Net income from financial management 18,756 13,000 30,824 21, Operating profit from ordinary activities before taxes 4,540 3,500 13,674 9, Profit for the period 2,676 2,206 8,539 5, RESOURCES Number of branches Staff (1) Before value adjustments. During the year, Financial Intermediation Activities on behalf of customers (FIA) of Cassa di Risparmio di Carrara SpA totalled euro 1,951.3 million (+1% and +3.9% over nine 71

72 and twelve months). Within the FIA, direct deposits totalled euro 1,001.7 million (-2.1% and +6.1% on December and September 2008); excluding bonds fully subscribed by the Parent Bank, at euro million, and including those issued by the Parent Bank and placed with customers of the subsidiary, at euro million, direct deposits amounted to euro 1,060.9 million (+3.5% and +5% in nine and twelve months respectively). Short-term deposits, at euro million, showed an increase of 1.8% in nine months and were up by 1.5% over twelve months. The medium/long-term component, at euro million, fell by 9.1% compared with December whereas it increased by 16.7% over September Indirect deposits stood at euro million (+4.6% and +1.7% in nine and twelve months); these included assets under custody, which reached euro million (+5% and +5.3% on December and September 2008) and assets under management at euro million (+3.6% and -7% in nine and twelve months respectively). Excluding bonds issued by the Parent Bank and placed with customers of Cassa di Risparmio di Carrara, indirect deposits amounted to euro 617 million (-2.3% and - 9.2% respectively over nine and twelve months). Loans to customers amounted to euro 1,000.3 million, essentially stable from the start of the year (-0.1%) and over twelve months (+0.1%). The gross bad loans/lending ratio stood at 3.2% (slightly higher than the 3% in December and September 2008). The securities portfolio amounted to euro million, more than quadrupling compared with the figures recorded in December and September The income statement showed a net profit of euro 7.8 million, down by 44.1% compared with September 2008, mainly due to the reduction in the intermediation margins; the cost/income ratio increased to 63.5%, from 48.7% in The interest margin fell by 25.9% to euro 26.3 million with respect to 30 September 2008, as a result of the trend in market rates. Net commissions remained essentially stable at euro 10.4 million (+0.3%); the net result from trading activities was positive at euro 0.6 million (euro 0.3 million as at September 2008). The gross operating income decreased by 19.4% to euro 37.3 million. As at 30 September 2009, net write-backs due to loan impairments and other financial items totalled euro 1 million compared with euro 2.7 million as at September Operating costs increased by 5.2% to euro 23.7 million, largely due to administrative costs which rose by 3.2% to euro 28.7 million. Other net operating revenues decreased by 3.7% to euro 5.5 million. Profits from ordinary activities before tax amounted to euro 12.6 million, 40.2% lower than the figure in the corresponding period in the previous year. Net of income taxes of euro 4.7 million, the profit for the period amounted to euro 7.8 million, down by 44.1%, compared with September CASSA DI RISPARMIO DI CARRARA (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 BALANCE SHEET Total assets 1,237,080 1,238,027 1,268,049 1,206, Direct deposits (A) 1,001, ,121 1,023, , Indirect deposits (B) 949, , , , Assets under management 256, , , , Assets in custody 692, , , , Financial Intermediation Activities (FIA) (A+B) 1,951,286 1,915,471 1,931,287 1,877, Loans to customers (1) 1,000,273 1,003,397 1,001, , Securities portfolio 143, ,705 33,498 24,960 Capital and reserves 97,928 97,789 96,111 96, INCOME STATEMENT Gross operating income 37,289 26,148 61,582 46, Net income from financial management 36,248 26,742 60,064 43, Operating profit from ordinary activities before taxes 12,554 10,982 29,615 21, Profit for the period 7,812 7,151 19,813 13, RESOURCES Number of branches Staff (1) Before value adjustments. The Financial Intermediation Activities on behalf of customers (FIA) of Banca Cesare Ponti SpA increased by 16.6%, amounting to euro 1,301.1 million (+10.4% in the first nine months of 2009). Within the FIA, direct deposits amounted to euro million (+4.3% from 72

73 December and +18.8% since September 2008) and indirect deposits totalled euro million (+13% from December 2008 and from September 2008); the latter included assets under management of euro million; +20.2% in nine months and +6.9% in the year); assets under custody amounted to euro million (+10.4% since December 2008 and +19.6% since September 2008). Excluding bonds issues fully subscribed by the Parent Bank, at euro 62.5 million, and including those issued by the Parent Bank and placed with customers of the subsidiary, at euro 41.4 million, direct deposits amounted to euro million (+5.9% and +3.6% in nine and twelve months respectively). Short-term deposits, at euro million, showed an increase of 6.9% in nine months (-0.7% over twelve months). The medium/long-term component, at euro 97.2 million, fell by 2.1% compared with December while it increased considerably compared with the euro 37.9 million in September With regard to indirect deposits, excluding bonds issued by the Parent Bank and placed with customers of Banca Cesare Ponti, the aggregate amounted to euro million (+13% and +14.1% in nine and twelve months respectively). Loans to customers amounted to euro million, down by 1.4% in nine months and by 1% in the year. The gross bad loans/lending ratio amounted to 4.2% (3.5% as at December and 3.7% as at September 2008). The securities portfolio amounted to euro million, up 31.1% in the nine-month period and 31.8% in the year. The income statement showed a net profit of euro 0.6 million, down by 44.1% on the amount generated in the same period of 2008, mainly due to the reduction in the net interest income. The cost/income ratio fell from 80.1% to 76.8% over the year. The net interest income, at euro 5 million, decreased by 15.8% over twelve months. Net commissions amounted to euro 4.4 million (9.7% over the year). Gross operating income amounted to euro 10.1 million, up by 1% in twelve months. As at 30 September 2009, net write-backs due to impairment to loans and other financial items were recorded totalling euro 895 thousand (euro 393 thousand as at September 2008). Operating costs totalled euro 7.8 million, down by 3.2% compared with September 2008, and more specifically: staff costs fell to euro 4.4 million (-1.7%); and other administrative costs decreased to euro 3.6 million (-6.4%). The profit from ordinary activities before taxes amounted to euro 1.5 million. Net of income taxes amounting to euro 0.9 million, the profit for the year totalled euro 0.6 million. BANCA CESARE PONTI (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 BALANCE SHEET Total assets 409, , , , Direct deposits (A) 362, , , , Indirect deposits (B) 938, , , , Assets under management 262, , , , Assets in custody 676, , , , Financial Intermediation Activities (FIA) (A+B) 1,301,132 1,316,032 1,178,436 1,115, Loans to customers (1) 246, , , , Securities portfolio 128, ,072 98,030 97, Capital and reserves 29,025 28,514 28,093 28, INCOME STATEMENT Gross operating income 10,122 6,897 13,721 10, Net income from financial management 9,227 6,621 13,338 9, Operating profit from ordinary activities before taxes 1,466 1,444 2,688 1, Profit for the period ,697 1, RESOURCES Number of branches Staff (1) Before value adjustments. 73

74 INSURANCE SUBSIDIARIES The results of the two insurance companies of the Group (Carige Assicurazioni SpA and Carige Vita Nuova SpA) are presented below, prepared in accordance with the applicable provisions of the Italian Civil Code and with the provisions specific for the insurance industry in Italy (Legislative Decree 175/1995, Legislative Decree 174/1995, Legislative Decree 173/1997, Legislative Decree 209/2005, ISVAP Provision 735/1997). It should be noted that such results are different from those reported in the section Insurance activities of this Report, where the information gathered from the so-called reporting packages are prepared by the companies based on the joint provisions of the Bank of Italy Provision no. 262 dated 22 December 2005, of the ISVAP Regulation no. 7 dated 13 July 2007 and of the relevant directions of the Parent Bank. Decree of the Ministry of Economy and Finance no dated 24 July 2009 allowed Insurance Companies to reiterate their derogation from the principle of using the most recent market data to evaluate the non-durable securities portfolio, granted by ISVAP Regulation no. 28 of 17 February 2009, as modified by ISVAP Provision no of 27 July In fact, the possibility was recognised, having verified the structure of commitments and the maturity of the relative disbursements, of using, for the evaluation of non-durable securities, the values recorded in the last set of financial statements, if lower, without prejudice to losses of a durable nature. The shareholders equity of Carige Assicurazioni SpA as at 30 September 2009 (operating in the non-life segment) amounted to euro million; technical reserves net of the reinsurance amount remained unchanged over the nine months (euro 859 million) whereas investments increased by 3.4% up to euro 848 million. The third quarter of 2009 closed with a positive result of euro 5.6 million against a negative result of euro 25 million in the same period in In particular, the result, which consolidated the effects of Decree no through the sterilisation of value adjustments on securities, maintaining the book value equal to the value of the last approved set of financial statements, showed value write-backs of euro 7.3 million while value adjustments, relating to those securities for which the aforementioned Decree was availed of, amounted to euro 1.4 million with a net effect of euro +5.9 million. In addition, a net improvement in the technical account result was recorded (up euro +9.7 million against a fall of euro million in September 2008). More specifically, this result was shaped by the fall in claims in the period, net of the reinsurance amount (-16.1% to euro million), the decrease in operating costs (-7.5% to euro 93.5 million), the drop in premiums in the period, net of the reinsurance amount (-5.8% to euro million) and the increase of the share of investment profits transferred from the nontechnical account (1.4 million as at 30 September 2008, 17.8 million as at 30 September 2009). Lastly, as regards monitoring of the undistributable reserve established in accordance with ISVAP Regulation no. 28, as amended, a significant improvement was recorded compared with 31 December 2008, from euro 47 million to euro 13.8 million at the end of the third quarter. CARIGE ASSICURAZIONI (figures in thousands of euro) Situation as at Change % 9/09 9/09 30/9/09 30/6/09 31/12/08 30/9/08 12/08 9/08 Recognised gross premiums 395, , , , % Premiums excluding reinsurance 359, , , , % Claims incurred and settled excluding reinsurance 262, , , , % Operating costs 93,544 65, , , % Profit/loss from technical account 9,696 4,867-33,746-30,353 Net profit 5,620 2,855-30,802-24,973 Investments 848, , , , % 3.3% Technical reserves excluding reinsurance 858, , , , % -0.1% Shareholderwith income 142, , , , % 26.4% Insurance agencies % 2.4% Staff % 1.7% 74

75 The shareholders equity of Carige Vita Nuova SpA as at 30 September 2009 (operating in the life insurance segment) amounted to euro 86.3 million, not including the increase in share capital of euro 80 million, already resolved and awaiting authorisation from the Bank of Italy. Investments and technical reserves, net of reinsurance, increased in the nine month period by 32.1% (to euro 2,769 million) and 33% (to euro 2,738.1 million) respectively. The result for the first nine months of 2009 was a positive euro 12.3 million, against a loss of euro 27.5 million in September The result for the period, which significantly improved over the result in the same period in the previous year, was predominantly influenced by strong improvement in the income from technical operations, which rose from euro in September 2008 to euro million in September The result consolidated the effects of Decree no through the sterilisation of value adjustments on securities, maintaining the book value equal to the value of the last approved set of financial statements, and showed value write-backs of euro million and irrecoverable losses mainly on the General Motors Corp. bonds for a total of euro 7.6 million. The monitoring of the undistributable reserve established in accordance with ISVAP Regulation no. 28, as amended, showed a strong improvement, from euro 75.9 million in the 2008 financial statements, to euro 23.6 million as at September Premiums written recorded a significant increase from euro million in September 2008 to euro million in September 2009, with the bancassurance channel recording a % increase and the agency channel up by +11.4%, thanks, in particular, to development of the sale of traditional Carige Soluzione Rendimento products, combined with the success of the new product Carige Soluzione Risparmio, issued during the course of As at September 2009, the charges for claims in the period (net of reinsurance ceded) amounted to euro million, up by 41.4% over the same period last year. This increase was essentially due to the maturity of Indexes in June and August. Specifically, the Carige Index Reddito e Garanzia expired on 3 June 2009 for an amount paid of euro 13.2 million, the Carige Index Evoluzione e Valore, expired on 15 June 2009 for an amount paid of euro 19.5 million, and the Index Reddito e Garanzia 2 expired on 7 August 2009 for an amount paid of euro 21.7 million. In addition, coupons on these indexes were also paid, totalling euro 6.0 million. Following the sharp increase in business in the bancassurance channel, an increase in operating costs was recorded (+32.7% to euro 23.3 million), due mainly to higher commissions paid because of growth in said volumes and the positive balance between revenues and other technical charges, net of reinsurance, amounting to euro 13.8 million. CARIGE VITA NUOVA SPA (figures in thousands of euro) Situation as at Change % 9/09 9/09 30/9/09 30/6/09 31/12/08 30/9/08 12/08 9/08 Recognised gross premiums 786, , , ,078 Premiums excluding reinsurance 780, , , ,633 Claims incurred and settled excluding reinsurance (1) 183, , , , % Operating costs 23,348 16,156 26,333 17, % Profit/loss from technical account 15,697 4,899-33,899-38,141 Net profit 12,270 4,499-24,060-27,548 Investments (2) 2,768,972 2,561,557 2,096,416 1,918, % 44.3% Technical reserves excluding reinsurance (2) 2,738,089 2,526,695 2,059,288 1,882, % 45.5% Shareholderwith income 86,272 78,501 29,001 25,513 Insurance agencies % 1.2% Staff % 16.5% (1) The item includes the amounts paid net of reinsurance ceded. (2) Including investments where risk is borne by the insured and pension funds. These are mainly investments in index- and unit-linked products. 75

76 FINANCIAL SUBSIDIARIES As at 30 September 2009 the overall assets managed by Carige A.M. SGR SpA amounted to around euro 4.3 billion, essentially stable from the start of the year but still down over the last twelve months (-12.8%). This trend reflects the steady increase in the Fondo Pensione Aperto (+26.4% over nine months and +32.7% since September 2008) and the reduction in Mutual Funds (-1.1% over nine months and -15.6% over twelve months), despite the strong growth seen since last June. Among the products managed by virtue of delegation, there was a steady recovery in the volumes of Assets under Management (-1.3% from the beginning of the year, -4% over twelve months) and insurance products (+2.3% increase over nine months and a 9.7% reduction from September 2008). The economic result showed a net profit of roughly euro 494 thousand (approximately euro 1.7 million as at 30 September 2008). Gross income stood at euro 5.3 million, composed of euro 23.6 million of commission income and euro 18.3 million of commission expense. Net financial revenue, formed mainly by income from investment of the Company s available funds, amounted to around euro 89 thousand while other net revenue stood at around euro 25 thousand. Operating and running costs amounted to euro 4.5 million. Profit from operations stood at euro 828 thousand. After taxes for euro 334 thousand, the profit for the first nine months of 2009 amounted to euro 494 thousand. CARIGE A.M. SGR (figures in thousands of euro) Situation as at Change % 9/09 9/09 30/9/09 30/6/09 31/12/08 30/9/08 12/08 9/08 DEALING Assets under management 4,259,420 3,980,143 4,253,490 4,882, Mutual funds 3,461,335 3,224,036 3,498,353 4,102, Assets management (customer assets) 418, , , , Insurance products (customer assets) 164, , , , Pension funds 214, , , , Total net of duplications Total assets 14,563 14,571 17,285 17, Capital and reserves 6,582 6,528 6,353 6, INCOME STATEMENT Net commissions 5,262 3,441 9,267 7, Administrative costs 4,510 3,139 6,292 4, Operating income ,399 2, Profit for the period ,202 1, RESOURCES Staff (1) (1) Seconded Parent Bank personnel except for one unit seconded from Cassa di Risparmio di Savona. Creditis Servizi Finanziari SpA continued to pursue its strategy of expanding its commercial offer, in relation to both personal loans and revolving cards. From the beginning of the year to the quarter end 17,576 personal loans were issued for a total amount of euro million. The amount financed, which includes arrangement fees and any insurance premiums on credit protection insurance (CPI) policies, amounted to euro million. A total of 8,956 insurance contracts were entered into against the loans disbursed, with a percentage penetration of 51%. During 2009 a total of 40,308 revolving cards have been issued, including 9,181 activated by the customers. There have been 48,322 uses for a total of euro 7.4 million. Parallel to such activity, 2,091 instant credit contracts were concluded by insurance agents having an arrangement with the Company. From a financial perspective, the first nine months of 2009 closed with a profit of euro 811 thousand. The interest margin stood at euro 5.3 million. Interest income, at euro 9.2 million, was made up mainly by interest on personal loans (euro 8.3 million). Interest payable amounted to euro 3.9 thousand and was generated by loans given by the Parent Bank. Commission income amounted to euro 2.5 million and was composed mainly by commissions from insurance companies for the distribution of CPI policies (euro 1.8 million). Commission 76

77 expenses amounted to euro 0.7 thousand, of which euro 0.6 thousand in commissions for loan placements. In terms of costs, costs for staff seconded by the Parent Bank amounted to euro 1.7 million. Other administrative costs, including amortisation, totalled euro 3.3 million. The pretax result was a positive euro 1.4 million and, net of income taxes of euro 617 thousand, a profit of euro 811 thousand was generated. CREDITIS SERVIZI FINANZIARI (figures in thousands of euro) Situation as at Change % 9/09 9/09 30/9/09 30/6/09 31/12/08 30/9/08 12/08 9/08 DEALING Loans to customers (1) 217, ,932 62,719 35,152 - Personal loans (1) 210, ,886 61,119 33,843 - Revolving credit cards (1) 7,584 5,046 1,600 1,309 Total assets 242, ,109 82,866 55,963 Capital and reserves 19,470 18,997 18,826 19, INCOME STATEMENT Net interest income 5,274 2,982 1, Net commissions 1,784 1, Administrative costs 4,978 3,301 3,196 2,002 Operating income 1, Profit for the period RESOURCES Staff (2) (1) Before value adjustments. (2) Seconded Parent Bank personnel. Argo Finance One Srl, a special purpose vehicle in the securitisation of bad loans, established by Banca Carige towards the end of 2000, in the first nine months of 2009 registered collections for euro 8 million. Against a net value from disposal of loans of euro million, collections from the start of the operation amounted to euro million. Priamar Finance Srl, a special purpose vehicle for the securitisation of bad loans established by Cassa di Risparmio di Savona at the end of 2002, collected euro 1.9 million in first nine months of Against a net value from disposal of loans of euro 28 million, collections from the start of the operation amounted to euro 36.8 million. Argo Mortgage Srl, a special purpose vehicle for the securitisation of private mortgage loans established by Banca Carige at the end of 2001, recorded takings for a total of euro million, of which euro 24.6 million in the first nine months of Argo Mortgage 2 Srl, a special purpose vehicle in the securitisation of mortgage loans to private customers, established by Banca Carige on 30 June 2004, registered overall collections of euro million, euro 70.6 million of which in the first nine months of Carige Covered Bond Srl, a special purpose vehicle for the securitisation of residential and commercial mortgages, established by Banca Carige on first November 2008, collected a total of euro million, euro of which in the first nine months of Overall loans granted amounted to euro 2,539.6 million, including euro 1,034 million as at September In December 2008, a first bond issue of euro 500 million was recorded. These securities, of which Banca Carige has full availability, are assets that can be adequately used in repurchase agreement transactions at the European Central Bank. Against the disposal made in September 2009, on 5 November 2009 new bonds were placed on the market for an amount of euro 1 billion. The issue, managed by a leading group of international banks, UBS Investment Bank, Natixis, Deutsche Bank, HSBC Group and Unicredit Group, was subscribed by asset management companies (41% of the total), retail banks (26%), central banks (23%) and insurance companies and pensions funds (around 10%). A total of 94% of the subscriptions were made by Italian, German, French, English and Finnish investors. The remaining 6% was split between the other major European countries. This security includes the following features: - maturity at seven years (25 November 2016); - annual coupon of 3.75%, a yield around 47 basis points higher than the BTPs of a similar duration; - a AAA/AAA rating from two of the major international rating agencies (Fitch and Moody s); - the status of bank bond secured by highly diversified mortgages. 77

78 THE OTHER MAIN SUBSIDIARIES Centro Fiduciario C.F. SpA closed the first nine months of 2009 with a net profit of euro 253 thousand. Revenue from production totalled euro 938 thousand, constituted by fiduciary administration commissions of euro 479 thousand and euro 459 thousand in fees paid by the Parent Bank for the provision of fiduciary services carried out in favour of the Bank s customers. Costs from ordinary operations totalling euro 573 thousand were recorded against said revenues. Income from ordinary company operations amounted to euro 364 thousand while extraordinary operations recorded financial income of euro 29 thousand. Net of taxes of euro 140 thousand, profit stood at euro 253 thousand. As regards Group real estate companies, a segment restructuring process is currently in progress, authorised on 6 August by the Bank of Italy, to be carried out through the merger by incorporation in Banca Carige of Immobiliare Ettore Vernazza SpA, Galeazzo Srl and the new company that is the recipient of the part of shareholders equity of Columbus Carige Immobiliare SpA which will be subject to division. In relation to the results of the respective activities as at 30 September 2009, Galeazzo Srl, a real estate company that manages the leasing of its properties to third parties, closed the nine months with a net profit of euro 31 thousand, down compared with euro 79 thousand as at 30 September The result from last year, as with the other real estate companies, benefitted from the recording of extraordinary income generated by the cancellation of discrepancies between statutory and tax values on instrumental properties owned. Columbus Carige Immobiliare SpA, a company which manages the leasing of the properties of the Group s companies and is active in the purchase of properties for their subsequent resale (merchandise assets), registered a net profit of euro 375 thousand, compared with euro 783 thousand registered in the same period of the previous year. Immobiliare Ettore Vernazza SpA closed the first nine months of 2009 with a net profit of euro 344 thousand (euro 519 thousand registered in the same period of the previous year). Rents amounted to around euro 1 million in the period. Immobiliare Carisa Srl, which operates in the purchasing of properties for resale (merchandise assets), closed the first nine months of 2009 with a loss of roughly euro 45.8 thousand (against a profit of euro 23 thousand in September 2008), determined essentially by an extraordinary charge tied to the unfavourable ruling in a legal case, which the company has appealed against, and extraordinary expenses incurred on owned property. 78

79 INTERIM FINANCIAL STATEMENTS OF THE PARENT BANK 79

80 FINANCIAL HIGHLIGHTS BALANCE SHEET (1) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Total assets 27,935,452 27,525,935 26,455,426 24,911, Funding 22,250,937 21,910,953 20,788,686 19,438, Direct Deposits (a) 21,078,566 21,207,823 19,705,213 18,041, * Amounts owed to customers 12,295,542 11,649,623 10,431,018 9,340, * Securities in issue 8,171,064 8,947,006 8,696,409 8,135, * Liabilities at fair value 611, , , , Amounts owed to banks 1,172, ,130 1,083,473 1,397, Indirect deposits (b) 17,990,329 17,854,197 17,865,828 18,433, Assets under management 10,286,248 9,798,642 9,314,653 9,491, Assets in custody 7,704,081 8,055,555 8,551,175 8,942, Financial Intermediation Activities (FIA) (a+b) 39,068,895 39,062,020 37,571,041 36,474, Investments 24,052,057 23,431,851 22,345,284 21,240, Loans to customers (2) 18,586,526 18,536,672 17,858,363 16,387, Loans to banks (2) 709, ,066 1,031,870 1,504, Securities portfolio 4,756,474 3,997,113 3,455,051 3,348, Capital and reserves 3,706,606 3,646,948 3,502,342 3,624, Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 INCOME STATEMENT (1) Gross operating income 665, , , , Net income from financial management 611, , , , Operating profit from ordinary activities before taxes 246, , , , Profit for the period 179, , , , RESOURCES (3) Number of branches Staff 4,546 4,554 4,565 4, FINANCIAL RATIOS Operating costs / Gross operating income 54.91% 54.73% 56.55% 51.83% Operating profit from ordinary activities before taxes /Capital and reserves 6.64% 4.74% 8.47% 6.64% ROE 4.84% 3.65% 6.38% 5.27% ROE (4) 6.02% 4.56% 7.81% 6.40% ROAE (5) 4.97% 3.72% 7.19% 6.03% ROAE (4) (5) 6.14% 4.68% 9.03% 7.53% RISK ASSETS AND REGULATORY RATIOS (6) Total Risk-Weighted Assets (1) 17,521,395 17,097,057 16,825,637 16,162, Core Tier 1/Total Risk-Weighted Assets 8.71% 8.93% 9.06% 10.41% Tier 1 capital / RWA 9.62% 9.86% 10.01% 10.41% Regulatory capital including Tier 3 capital/total weighted assets 12.11% 12.40% 12.58% 12.16% (1) Figures in thousands of euro (2) Gross of value adjustments and net of debt securities classified as L&R. (3) Statistics of the end of period. (4) (5) Net of the AFS reserve established against the revaluation of the equity investment in the Bank of Italy. Net profit on average shareholders' equity (Return On Average Equity). (6) Figures as at 30/06/2009 are the official figures and therefore they differ from the management data shown in the half-year report. 80

81 FINANCIAL STATEMENTS OF THE PARENT BANK 81

82 BALANCE SHEET BALANCE SHEET (thousands of euro) ASSETS 09/09 12/08 Change % 30/09/09 30/06/09 31/12/08 30/09/ CASH AND CASH EQUIVALENTS 198, , , ,808 (16.4) FINANCIAL ASSETS HELD FOR TRADING 801, , ,770 1,446, (44.6) 30 -FINANCIAL ASSETS DESIGNATED AT FAIR VALUE AVAILABLE-FOR-SALE FINANCIAL ASSETS 2,774,716 1,974,570 1,548,112 1,319, FINANCIAL ASSETS HELD TO MATURITY 404, , ,914 66,479 (4.1) 60 -LOANS TO BANKS 1,492,300 1,676,042 1,804,097 1,973,076 (17.3) (24.4) 70 -LOANS TO CUSTOMERS 18,247,776 18,225,660 17,590,098 16,072, HEDGING DERIVATIVES 68,780 58,254 53,246 21, EQUITY INVESTMENTS 1,037,102 1,037, , , TANGIBLE ASSETS 575, , , ,609 (0.8) INTANGIBLE ASSETS 1,474,150 1,470,898 1,467,101 1,347, including: - goodwill 1,415,135 1,415,481 1,415,481 1,300,402 (0.0) TAX ASSETS 164, , , ,632 (32.5) (9.9) a) current 21,596 54,766 75,969 54,445 (71.6) (60.3) b) advanced 143, , , ,187 (14.8) OTHER ASSETS 694, , , ,071 (21.0) (9.4) TOTAL ASSETS 27,935,452 27,525,935 26,455,426 24,911, LIABILITIES Change % 30/09/09 30/06/09 31/12/08 30/09/08 09/09 12/08 09/09 09/ AMOUNTS OWED TO BANKS 1,172, ,130 1,083,473 1,397, (16.1) 20 -AMOUNTS OWED TO CUSTOMERS 12,295,542 11,649,623 10,431,018 9,340, SECURITIES IN ISSUE 8,171,064 8,947,006 8,696,409 8,135,189 (6.0) FINANCIAL LIABILITIES FROM TRADING 152, , ,561 99, FINANCIAL LIABILITIES DESIGNATED AT FAIR VALUE 611, , , , HEDGING DERIVATIVES 195, , ,581 20, TAX LIABILITIES 200, , , , (10.8) (a) current 31,898 35,257 26,861 59, (46.6) (b) deferred 168, , , , OTHER LIABILITIES 840, ,854 1,093, ,307 (23.1) (7.5) 110 -STAFF TERMINATION INDEMNITY 69,885 70,657 71,841 67,203 (2.7) PROVISIONS FOR RISKS AND CHARGES: 339, , , ,070 (5.4) 1.0 a) pensions and similar obligations 291, , , ,854 (3.3) (3.3) b) other provisions 48,417 39,945 58,018 35,216 (16.5) VALUATION RESERVES 580, , , , CAPITAL INSTRUMENTS 1,178 1,178 1,179 1,264 (0.1) (6.8) 160 -RESERVES 321, , , , ADDITIONAL PAID-IN CAPITAL 1,012,742 1,013,034 1,013,259 1,013,376 (0.1) (0.1) 180 -CAPITAL 1,790,300 1,790,300 1,790,299 1,789, OWN SHARES (-) PROFIT (LOSS) FOR THE PERIOD 179, , , ,976 (19.8) (6.1) TOTAL LIABILITIES 27,935,452 27,525,935 26,455,426 24,911, /09 09/08 82

83 INCOME STATEMENT INCOME STATEMENT (figures in thousands of euro) Change % 30/09/09 30/06/09 31/12/08 30/09/08 09/09 09/ INTEREST INCOME AND SIMILAR REVENUES 733, ,735 1,227, ,365 (17.8) 20 - INTEREST EXPENSES AND SIMILAR CHARGES (323,509) (234,649) (633,963) (464,123) (30.3) 30 -NET INTEREST INCOME 410, , , ,242 (4.2) 40 - COMMISSION INCOME 196, , , , COMMISSION EXPENSES (21,355) (14,152) (32,210) (23,724) (10.0) 60 -NET COMMISSIONS 175, , , , DIVIDENDS AND OTHER SIMILAR REVENUES 56,379 56,097 60,505 55, NET INCOME FROM TRADING ACTIVITIES 6, (38,666) (31,335) 90 - NET INCOME FROM HEDGING ACTIVITIES 2,033 1,789 (393) PROFIT (LOSS) ON DISPOSAL OR REPURCHASE OF: 15,896 10,558 12,668 13, a) loans 1,703 1,051 3,902 2,425 (29.8) b) available-for-sale financial assets 2,708 (2,135) 9,593 8,297 (67.4) d) financial liabilities 11,485 11,642 (827) 2, NET VALUE ADJUSTMENT ON FINANCIAL ASSETS AND LIABILITIES DESIGNATED AT FAIR VALUE (1,176) 1, , GROSS OPERATING INCOME 665, , , , NET VALUE ADJUSTMENTS DUE TO IMPAIRMENT OF: (53,651) (39,436) (66,954) (64,423) (16.7) a) loans (51,389) (38,201) (60,894) (63,617) (19.2) b) available-for-sale financial assets (2,141) (1,531) (7,970) - d) other financial assets (121) 296 1,910 (806) (85.0) 140 -NET INCOME FROM FINANCIAL MANAGEMENT 611, , , , ADMINISTRATIVE COSTS: (387,456) (269,393) (501,902) (360,669) 7.4 a) staff costs (236,480) (163,984) (298,660) (209,270) 13.0 b) other administrative costs (150,976) (105,409) (203,242) (151,399) (0.3) NET PROVISIONS FOR RISKS AND CHARGES (2,553) (2,165) (2,148) 3, DEPRECIATION OF TANGIBLE ASSETS (11,055) (7,253) (12,947) (8,653) AMORTIZATION OF INTANGIBLE ASSETS (12,638) (8,017) (13,415) (9,437) OTHER OPERATING EXPENSES AND REVENUES 48,499 30,209 57,040 47, OPERATING COSTS (365,203) (256,619) (473,372) (328,010) PROFIT (LOSS) FROM EQUITY INVESTMENTS (52) - (78) PROFIT (LOSS) FROM DISPOSAL OF INVESTMENTS 12 (1) (52.0) 250 -OPERATING PROFIT (LOSS) FROM ORDINARY ACTIVITIES BEFORE TAXES 246, , , , INCOME TAXES FOR THE PERIOD (66,973) (39,766) (73,300) (49,497) PROFIT (LOSS) FROM ORDINARY ACTIVITIES AFTER TAXES 179, , , ,976 (6.1) 290 -PROFIT (LOSS) FOR THE PERIOD 179, , , ,976 (6.1) (1) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". The figures as at September 2008 have been adequately reclassified to allow a homogeneous comparison. 83

84 STATEMENT OF COMPREHENSIVE INCOME STATEMENT OF COMPREHENSIVE INCOME (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/09 31/12/08 30/9/08 absolute % 10 PROFIT (LOSS) FOR THE PERIOD 179, , , ,976 (11,738) -6.1% Other income components after taxes 20 Available-for-sale financial assets: 137,673 65,810 (154,846) (83,805) 221, % 30 Tangible assets Intangible assets Foreign investment hedge: Cash flow hedge: (9,650) 2,263 (55,982) (5,184) (4,466) 86.1% 70 Currency differences: Non-current assets held for sale: Actuarial profits (losses) on defined benefit plans Share of the valuation reserves of equity investments designated at equity: Total other income components after taxes 128,023 68,073 (210,828) (88,989) 217, % 120 TOTAL PROFITABILITY (Item ) 307, ,166 12, , , % 84

85 STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY Capital: 1,790,299-1,790, ,790,300 a) ordinary shares 1,615,033-1,615, ,615,034 b) other shares 175, , ,266 Additional paid-in capital 1,013,259-1,013, (517) ,012,742 Reserves: 245, ,149 76, ,908 a) profits 216, ,219 76, ,979 b) other 28,929-28, ,929 Valuation reserves: 452, , , ,478 Capital instruments 1,179-1, (1) ,178 Own shares Profit (Loss) for the period 223, ,469 (76,760) (146,709) , ,238 Shareholders' equity 3,725,810-3,725,810 - (146,709) - (517) ,261 3,885,844 Figures in thousands of euro Balance as at 31/12/2008 Change in opening balances Balance as at 1/01//2009 Allocation of profits/losses for the previous year Reserves Dividends and other allocations Changes in reserves New shares issued Changes in the year Transactions on shareholders equity Own shares purchased Extraordinary distribution of dividends Changes in capital instruments Own shares derivatives Stock options Total profitability for the period as at 30/09/2009 Shareholders equity as at 30/09/

86 Capital: 1,390,082-1,390, , ,790,299 a) ordinary shares 1,214,734-1,214, , ,615,032 b) other shares 175, , (81) ,267 Additional paid-in capital 461, , , ,013,259 Reserves: 195, ,795 63,347 - (13,932) (61) ,149 a) profits 166, ,805 63,347 - (13,932) ,220 b) other 28,990-28, (61) ,929 Valuation reserves: 663, , (171) (210,828) 452,456 Capital instruments 1,219-1, (40) ,179 Own shares Profit (Loss) for the period 210, ,049 (63,347) (146,702) , ,469 Shareholders' equity 2,921,664-2,921,664 - (146,702) (13,932) 952, ,641 3,725,811 Figures in thousands of euro Balance as at 31/12/2007 Change in opening balances Balance as at 1/01//2008 Allocation of profits/losses for the previous year Reserves Dividends and other allocations Changes in reserves New shares issued Changes in the year Transactions on shareholders equity Own shares purchased Extraordinary distribution of dividends Changes in capital instruments Own shares derivatives Stock options Total profitability for the period as at 31/12/2008 Shareholders equity as at 31/12/

87 Capital: 1,390,082-1,390, , ,789,979 a) ordinary shares 1,214,734-1,214, , ,614,712 b) other shares 175, , (81) ,267 Additional paid-in capital 461, , , ,013,376 Reserves: 195, ,795 63,347 - (13,932) (61) ,149 a) profits 166, ,805 63,347 - (13,932) ,220 b) other 28,990-28, (61) ,929 Valuation reserves: 663, , (131) (88,989) 574,335 Capital instruments 1,219-1, ,264 Own shares Profit (Loss) for the period 210, ,049 (63,347) (146,702) , ,976 Shareholders' equity 2,921,664-2,921,664 - (146,702) (13,932) 952, ,987 3,815,079 Figures in thousands of euro Balance as at 31/12/2007 Change in opening balances Balance as at 1/01//2008 Allocation of profits/losses for the previous year Reserves Dividends and other allocations Changes in reserves New shares issued Changes in the year Transactions on shareholders equity Own shares purchased Extraordinary distribution of dividends Changes in capital instruments Own shares derivatives Stock options Total profitability for the period as at 30/09/2008 Shareholders equity as at 30/09/

88 CASH FLOW STATEMENT CASH FLOW STATEMENT Direct method A. OPERATING ACTIVITIES 30/09/09 30/06/09 31/12/08 30/09/08 1. Management 211, , , ,354 - interest income received (+) 696, ,030 1,223, ,398 - interest expenses paid (-) (353,221) (272,076) (598,233) (434,003) - dividends and similar revenues (+) 9,772 9,512 13,480 11,886 - net commissions (+/-) 175, , , ,049 - staff costs (-) (200,915) (134,615) (239,582) (175,238) - other costs (-) (179,983) (128,088) (332,878) (237,449) - other revenues (+) 92,924 66, , ,408 - taxes and duties (-) (28,471) (27,851) (101,292) (48,697) 2. Liquidity generated/absorbed by financial assets (1,255,304) (993,574) (3,752,660) (2,362,050) - financial assets held for trading (123,097) (159,096) 56,441 (198,784) - financial assets designated at fair value (663) available-for-sale financial assets (1,013,556) (334,127) (139,668) (11,745) - loans to customers (672,293) (674,775) (3,386,510) (1,941,325) - loans to banks: at sight 4, ,794 (92,348) - loans to banks: other loans 301, ,740 (232,785) 24,436 - other assets 247,692 45,641 (388,932) (142,284) 3. Cash generated/absorbed by financial liabilities 1,192,146 1,002,674 3,601,831 2,026,237 - amounts owed to banks: at sight 518,381 (760,687) 315, ,163 - amounts owed to banks: other (427,054) 383,637 (1,763,487) (1,274,106) - amounts owed to customers 1,852,846 1,212,083 2,190,482 1,101,917 - securities in issue (464,008) 314,440 2,661,346 2,074,638 - financial liabilities from trading 34,754 30,937 (28,492) (69,436) - financial liabilities designated at fair value 9,154 19,609 39,119 42,532 - other liabilities (331,927) (197,345) 187,571 18,529 Net liquidity generated/absorbed by operating activities 148, , ,102 41,541 B. INVESTING ACTIVITIES 1. Liquidity generated by 60,530 60,632 47,064 44,059 - equity investment disposals - - (78) - - dividends received on equity investments 46,607 46,585 47,025 44,034 - disposal/reimbursement of financial assets held to maturity 13,911 14, tangible asset disposals 12 (1) Liquidity absorbed by (101,537) (90,642) (1,036,170) (904,125) - equity investment acquisitions (75,004) (74,994) (16,056) (15,728) - tangible asset acquisitions (6,493) (3,834) (32,503) (21,289) - intangible asset acquisitions (20,040) (11,814) (29,202) (20,934) - business unit acquisitions - - (958,409) (846,174) Net liquidity generated/absorbed by investing activities (41,007) (30,010) (989,106) (860,066) C. FUNDING ACTIVITIES - own share issues/acquisitions , ,852 - additional paid-in capital , ,934 - capital instrument issues/acquisitions - - (8,031) - - dividend distribution and others (146,710) (146,710) (146,702) (146,702) Net liquidity generated/absorbed by funding activities (146,710) (146,710) 794, ,084 NET LIQUIDITY GENERATED/ABSORBED DURING THE PERIOD (39,123) (24,333) 42,589 (15,441) - KEY: (+) generated, (-) absorbed Figures in thousands of euro. RECONCILIATION Balance sheet items 30/09/09 30/06/09 31/12/08 30/09/08 Cash and cash equivalents at the beginning of the period Total net liquidity generated/absorbed during the period Cash and cash equivalents at period end 237, , , ,250 (39,123) (24,333) 42,589 (15,441) 198, , , ,809 Figures in thousands of euro 88

89 EXPLANATORY NOTES 89

90 ACCOUNTING POLICIES The Interim Report on Operations of the Banca Carige S.p.A. Cassa di Risparmio di Genova e Imperia has been drawn up in accordance with IAS 34 (Interim financial statements). The international accounting principles IAS/IFRS and the related interpretations (SIC/IFRIC), officially approved by the European Union and in force on 30 September 2009, were applied for the valuation and measurement of the accounting balances, and, where necessary, the directions referred to in the Bank of Italy Circular no. 262 dated 22 December 2005 were observed (financial statements for banks: schemes and rules for preparation). As regards the phases of classification, recording, valuation and cancellation of asset and liability items involved in preparing this Report, as with the methods of entering costs and revenues, the same accounting standards used in preparation of the financial statements as at 31 December 2008 were applied, with the exception of what is detailed below. For more details please refer to the paragraph Accounting policies in the Consolidated Interim Financial Statements of the Banca Carige Group. The Interim Financial Statements contained in this Interim Financial Report have been audited by the company Deloitte & Touche SpA. 90

91 NET INCOME FROM INTERMEDIATION ACTIVITIES It should be pointed out that, effective from 2006 (ex-law 262/2005, Provisions for the protection of savings and regulation of financial markets ), the Carige Group introduced an organisational change which reserves the role of bond issuer for the Parent Bank, and entrusts the activity of placement to all Group Banks; subsequently, to avoid problems connected with maturity transformation, Carige s Board of Directors resolved the hedging of the medium/long-term financial requirements of subsidiary banks through the issue of its own bonds subscribed by Carige. For the Parent Bank, said operation determined a re-composition of FIA in favour of direct deposits, which recorded a sharp rise over the twelve-month period, and an increase in the volume of the securities portfolio. The aggregate of the Financial Intermediation Activities on behalf of customers (FIA) direct and indirect deposits amounted to euro 39,068.9 million, an increase of 4% and 7.1% respectively in nine and twelve months. Direct deposits amounted to euro 21,078.6 million, an increase of 7% in six months and 16.8% in twelve months; indirect deposits totalled euro 17,990.3 million, an increase from the start of the year (+0.7%) and down by 2.4% from September 2008; it is composed for 57.2% of assets under management and 42.8% of assets under custody. FINANCIAL INTERMEDIATION ACTIVITIES (figures in thousands of euro) Situation as at Change % 30/09/09 30/06/09 31/12/08 30/09/08 09/09 09/09 12/08 09/08 Total (A+B) 39,068,895 39,062,020 37,571,041 36,474, Direct deposits (A) 21,078,566 21,207,823 19,705,213 18,041, % on Total 54.0% 54.3% 52.4% 49.5% Indirect deposits (B) 17,990,329 17,854,197 17,865,828 18,433, % on Total 46.0% 45.7% 47.6% 50.5% - Assets under management 10,286,248 9,798,642 9,314,653 9,491, % on Total 26.3% 25.1% 24.8% 26.0% % on Indirect deposits 57.2% 54.9% 52.1% 51.5% - Assets in custody 7,704,081 8,055,555 8,551,175 8,942, % on Total 19.7% 20.6% 22.8% 24.5% % on Indirect deposits 42.8% 45.1% 47.9% 48.5% Total funding, which includes direct deposits from customers (euro 21,078.6 million) and banks (euro 1,172.4 million), amounted to euro 22,250.9 million, up by 7% from the beginning of the year, and by 14.5% from the end of September Direct deposits increased by 7% from the start of the year and by 16.8% from the end of September The short-term component, at euro 12,110.5 million, increased by 18.4% over nine months and 33.7% over twelve months, driven, in particular, by the success of the initiative tied to the introduction of the new on-line deposit account. Medium/long-term deposits, equal to euro 8,968.1 million, fell by 5.4% in nine months and 0.2% in twelve months, accounting for 42.5% of the total (48.1% in December and 49.8% in September 2008). Within direct deposits, amounts owed to customers totalled euro 12,295.5 million (+17.9% and +31.6% in nine and twelve months respectively). Securities in issue were represented almost entirely by bonds (-5.7% in nine months and +0.7% in the year), equalling a total of euro 8,171.1 million (-6% and +0.4% in nine and twelve months respectively). Liabilities designated at fair value (euro 612 million) rose by 5.9% over December 2008 and 8.3% against September The amount owed to banks rose by 8.2% for the nine month period but fell by 16.1% from September

92 FUNDING (figures in thousands of euro) Situation as at Change % 30/09/09 30/06/09 31/12/08 30/09/08 09/09 09/09 12/08 09/08 Total (A+B) 22,250,937 21,910,953 20,788,686 19,438, Direct deposits (A) 21,078,566 21,207,823 19,705,213 18,041, Amounts owed to customers 12,295,542 11,649,623 10,431,018 9,340, current accounts and free deposits 11,819,346 11,160,889 9,727,643 8,281, repurchase agreements 8,798 9, , , term deposits 23,423 24,257 28,062 34, loans 1,870 1,854 1, , funds managed on behalf of third parties other deposits 441, , , , Securities in issue 8,171,064 8,947,006 8,696,409 8,135, bonds 7,995,485 8,743,577 8,475,835 7,940, other securities 175, , , , Liabilities at fair value 611, , , , bonds 611, , , , short term 12,110,482 11,477,861 10,226,893 9,057, % on Total medium-long term 8,968,084 9,729,962 9,478,320 8,983, % on Total Amounts owed to banks (B) 1,172, ,130 1,083,473 1,397, Deposits of central banks 24,066 25,004-59, Current accounts and free deposits 35, , , , Term deposits 188, , , , Repurchase agreements 605,994 73,116 71, ,656 Loans 318, , , , Indirect deposits, at euro 17,990.3 million, increased against the end of 2008 (+0.7%) and fell by 2.4% over the twelve months. Assets under management amounted to euro 10,286.2 million, an increase on December 2008 (+10.4%) and September 2008 (+8.4%); assets under custody stood at euro 7,704.1 million, down against December 2008 (-9.9%) and September 2008 (- 13.8%). With reference to assets under management, in the first nine months a decrease was recorded in mutual funds (-3.6% to euro 3,774.7 million) whereas there was an increase in both assets managed (+21.6% to euro 3,573.6 million) and bancassurance products (+19.4% to euro 2,937.9 million). In the twelve-month period, the increase in bancassurance products (+30.6%) and assets managed (+30%) was essentially offset by the fall in mutual funds (-16%). As regards the assets in custody, government bonds fell by 18.1% in the nine month period to euro 4,021.7 million, and 17.2% on a year-onyear basis. The other securities (euro 3,682.4 million) increased by 1.2% on the year end but fell with respect to September 2008 (-9.9%). INDIRECT DEPOSITS (figures in thousands of euro) Situation as at Change % 30/09/09 30/06/09 31/12/08 30/09/08 09/09 09/09 12/08 09/08 Total (A+B) 17,990,329 17,854,197 17,865,828 18,433, Assets under management (A) 10,286,248 9,798,642 9,314,653 9,491, Mutual funds 3,774,737 3,593,098 3,915,407 4,491, Asset management (1) 3,573,569 3,379,507 2,938,349 2,749, Bancassurance products 2,937,942 2,826,037 2,460,897 2,250, Assets in custody (B) 7,704,081 8,055,555 8,551,175 8,942, Government securities 4,021,731 4,415,767 4,913,424 4,854, Other 3,682,350 3,639,788 3,637,751 4,087, (1) The figure includes the entire securities portfolio of the insurance subsidiaries. 92

93 Loans to customers, net of value adjustments totalling euro million, amounted to euro 18,153.4 million, up by 4% compared with December 2008 (by 13.8% in twelve months). Before adjustments, the aggregate amounted to euro 18,586.5 million, showing a 4.1% increase in nine months and up 13.4% in twelve months. The short-term component stood at euro 4,018 million, down over the nine months (-12.6%), but up by 9.7% over twelve months; the medium/long-term component amounted to euro 13,882.7 million (+9.1% in nine months and +14.3% in twelve months), representing 74.7% of the nominal value (71.2% in December and 74.1% in September 2008). Bad loans amounted to euro million (+27.2% from the beginning of the year and +18.1% in the twelve month period) representing 3.7% of total loans, greater than the 3% in December and the 3.5% in September Mortgages, inclusive of assets sold and not cancelled, amounted to euro 10,104.7 million and were the largest item within the loans to customers; the aggregate grew by 6.2% on December and 10.8% on September Current accounts amounted to euro 2,219.5 million (-5.3% over nine months and +3.4% over twelve months). It should be pointed out that, by virtue of the commercial co-operation agreement signed with Creditis Servizi Finanziari SpA (Carige Group company specialised in consumer credit), as of 1 July 2008, the Bank started to place personal loans through said Company, providing loans totalling euro 146 million over the nine months (euro million from the start of activities); also taking into account loans granted through Creditis, the trend in consumer credit showed a positive performance (+12.5% in nine months and +16% in the year). Net of value adjustments of euro 0.9 million, loans to banks amounted to euro million, down by 31.3% from the end of 2008 and 52.9% from September The net interbank position (difference between loans and amounts owed to banks), showed a net debt position of euro million against a net debt position of euro 51.6 million in December and a net credit position of euro million in September

94 LOANS (1) (figures in thousands of euro) Situation as at Change % 30/09/09 30/06/09 31/12/08 30/09/08 09/09 09/09 12/08 09/08 Total (A+B) 18,861,561 19,012,661 18,493,895 17,455, Loans to customers (A) 18,153,390 18,115,484 17,462,803 15,951, nominal value (2) 18,586,526 18,536,672 17,858,363 16,387, current accounts 2,219,483 2,199,499 2,344,498 2,146, repurchase agreements - 255, , mortgages (3) (4) 9,747,674 9,467,084 9,102,958 8,673, credit cards, personal loans and salarybacked loans 275, , , , leasing 816, , , , factoring 118, , , , other loans 3,652,079 3,685,679 2,917,815 2,673, assets sold and not cancelled (4) 357, , , , impaired assets (4) (5) 1,400,239 1,315,200 1,107,357 1,119, short term 4,018,040 4,357,123 4,595,653 3,663, % on nominal value medium/long term 13,882,707 13,545,378 12,723,508 12,143, % on nominal value Bad loans 685, , , , % on nominal value Value adjustments (-) 433, , , , Loans to banks (B) 708, ,177 1,031,092 1,503, nominal value (2) 709, ,066 1,031,870 1,504, compulsory reserves 278, , , , other loans to central banks current accounts and free deposits 115, , , , term deposits 50, , , , repurchase agreements 120, ,813 23, , loans 127,617 63, ,919 90, impaired assets 15,875 16,326 16,116 16, short term 663, , ,194 1,418, % on nominal value medium/long term 45,727 63,691 84,676 85, % on nominal value Bad loans % on nominal value Value adjustments (-) (1) Net of debt securities classified as L&R. (2) Before value adjustments. (3) Including the fair value of loans for which we exercised the option of the so-called "Fair Value Option" (para. 9 IAS 39) - euro 753 thousand (4) Following some recent clarifications provided by the Bank of Italy, loans included in sub-item "assets sold and not cancelled" related to securitisation transactions, for which no "derecognition" has taken place, have been reclassified to sub-items "mortgages" and "impaired assets". (5) Impaired assets do not include assets sold and not cancelled. With regard to customers, impaired loans, cash and endorsement, amounted to euro 1,443.6 million, up by 25.9% for the nine-month period and 24.4% in the year, and the corresponding value adjustments amounted to euro million (+8.6% and +1.9% for the nine-month and twelve-month periods respectively). The cash loans component stood at euro 1,422.4 million (+26.2% since December and +24.7% since September 2008). Endorsement loans equalled euro 21.2 million (+7% in the ninemonth period and +4.2% in the twelve-month period). As regards cash loans to customers, the analysis of the individual aggregates shows the following: bad loans totalled euro million, up by 27.2% from the beginning of the year, and by 18.1% in the year; they were written down by 46.2% (54.1% in December and 55.8% in September 2008). The bad loans/loans ratio as regards customers stood at 3.7%, up on both December (3%) and September 2008 (3.5%). The Bank, in line with the overall goal of a wider and more extensive use of rating system basic parameters in managerial and operational practice, adopted the statistical LGD model (Loss Given Default) for the evaluation of insignificant bad loan positions, developed in-house on the basis of discounted historical flows of collections linked to the recovery process. The average 94

95 amount of the positions evaluated in this way stood at roughly euro 40,000. The LGD model, which takes account of all direct and indirect costs connected with the recovery process makes it possible to maintain an analytical approach to evaluating individual positions, examined, in fact, on the basis of different analysis axes which weigh up the nature of the borrower, the range of exposure at the moment of default, the type of guarantee given and its level of hedging. Application of this methodology permits positive results of an operating nature, in light of greater standardisation of processes and a higher level of consistency in the evaluation of the positions in question, and has a positive impact on value adjustments on the bad loans portfolio; watchlist loans amounted to euro million, up by 12.2% from the end of the year and 58.1% in the twelve-month period. They were written down by 13.2% (14.5% in December and 11.7% in September 2008); rescheduled loans amounted to euro million, an increase over the euro 3.7 million in December 2008 and euro 3.8 million in September They were written down by 2% (6.7% in December 2008 and 6.8% in September 2008); past due loans amounted to euro 217 million, down by 0.9% in the nine month period and by 26.9% in the twelve month period. They were written down by 2.6% (1.6% in December and 5.6% in September 2008). Impaired endorsement loans amounted to euro 21.2 million, down by 7% in nine months and 4.2% in the twelve-month period; they were written down by 23.1% (24.1% in December and 26.3% in September 2008). Overall, value adjustments on cash and endorsement loans to customers amounted to euro million, including euro million of cash loans and euro 8.5 million of endorsement loans. 95

96 CREDIT QUALITY (1) (figures in thousands of euro) Gross exposure (a) Value adjustments (b) 30/9/09 30/6/09 Net exposure (a-b) % Gross exposure (a) Value adjustments (b) Net exposure (a-b) b/a b/a Cash loans(2) Bad loans 685, , , , , , customers 685, , , , , , Watchlist loans 409,484 54, , ,291 52, , banks customers 409,237 54, , ,046 52, , Rescheduled loans 125,928 3, , ,395 3, , banks 15, , , , customers 110,302 2, , ,316 2, , Past due loans 217,038 5, , ,849 4, , banks customers 217,036 5, , ,847 4, , Total impaired loans 1,438, ,470 1,058, ,351, , , Performing loans 17,857,354 54,552 17,802, ,083,032 48,878 18,034, banks 693, , , , customers 17,164,172 54,552 17,109, ,201,292 48,878 17,152, Total cash loans 19,295, ,022 18,861, ,434, ,077 19,012, banks 709, , , , customers 18,586, ,136 18,153, ,536, ,188 18,115, Credit commitments Impaired 21,219 4,898 16, ,904 4,770 14, customers 21,219 4,898 16, ,904 4,770 14, Other loans 1,426,014 3,597 1,422, ,418,349 3,309 1,415, banks 21,162-21,162-20,078-20, customers 1,404,852 3,597 1,401, ,398,271 3,309 1,394, Total credit commitments 1,447,233 8,495 1,438, ,437,253 8,079 1,429, banks 21,162-21,162-20,078-20, customers 1,426,071 8,495 1,417, ,417,175 8,079 1,409, Total 20,742, ,517 20,300, ,871, ,156 20,441, banks 730, , , , customers 20,012, ,631 19,570, ,953, ,267 19,524, % Gross exposure (a) Value adjustments (b) 31/12/08 30/9/08 Net exposure (a-b) % Gross exposure (a) Value adjustments (b) Net exposure (a-b) b/a b/a Cash loans Bad loans 539, , , , , , customers 539, , , , , , Watchlist loans 365,067 52, , ,819 30, , banks customers 364,826 52, , ,773 30, , Rescheduled loans 19,535 1,004 18, , , banks 15, , , , customers 3, , , , Past due loans 219,042 3, , ,306 16, , banks customers 219,040 3, , ,066 16, , Total impaired loans 1,142, , , ,156, , , Performing loans 17,747,387 47,156 17,700, ,735,902 65,010 16,670, banks 1,015,754-1,015,754-1,488,242-1,488, customers 16,731,633 47,156 16,684, ,247,660 65,010 15,182, Total cash loans 18,890, ,338 18,493, ,892, ,714 17,455, banks 1,031, ,031, ,504, ,503, customers 17,858, ,560 17,462, ,387, ,067 15,951, Credit commitments Impaired 19,826 4,772 15, ,361 5,364 14, customers 19,826 4,772 15, ,361 5,364 14, Other loans 1,536,678 3,603 1,533, ,458,806 5,697 1,453, banks 58,586-58,586-70,880-70, customers 1,478,092 3,603 1,474, ,387,926 5,697 1,382, Total credit commitments 1,556,504 8,375 1,548, ,479,167 11,061 1,468, banks 58,586-58,586-70,880-70, customers 1,497,918 8,375 1,489, ,408,287 11,061 1,397, Total 20,446, ,713 20,042, ,371, ,775 18,923, banks 1,090, ,089, ,575, ,574, customers 19,356, ,935 18,952, ,796, ,128 17,349, (1) Net of debt securities classified as Loans & Receivables (L&R) (2) Including the fair value of loans to customers for which we opted for the so-called "Fair Value Option" (para. 9 IAS 39) - Assets Item 30 amounting to euro 753 thousand. % The securities portfolio amounted to euro 4,756.5 million, up by 37.7% and 42.1% in nine and twelve months respectively. Roughly 76% of the portfolio was accounted for by debt securities, 96

97 which increased by +48.7% in nine months and +61.5% in twelve. Equities showed lower growth (+12.6% and +6.7%) while shares in collective investment schemes increased from the beginning of the year (+1.7%) but fell over twelve months (- 20.4%). Equities available for sale included the equity investment in the Bank of Italy, accounted for at euro million; this figure results from a valuation at fair value - using shareholders equity as the most reliable proxy of fair value performed on the basis of the balance sheet data of the Bank of Italy as at 31 December 2008 (last approved financial statements), consistent with the accounting principle adopted for the preparation of the financial statements of the Bank and of the consolidated financial statements of the Banca Carige Group as at 31 December SECURITIES PORTFOLIO (figures in thousands of euro) Situation as at Change % 30/09/09 30/06/09 31/12/08 30/09/08 09/09 09/09 12/08 09/08 Debt securities 3,622,551 2,913,554 2,435,460 2,243, Held for trading 651, , ,129 1,325, Available for sale 1,687, , , ,388 Loans & Receivable 879, , , ,937 Held to maturity 404, , ,914 66, Equities 1,000, , , , Held for trading 1,147 1,171 1,493 1, Available for sale 999, , , , Shares in collective investment schemes 132, , , , Held for trading 45,813 45,424 45,103 44, Available for sale 87,182 84,372 85, , Total 4,756,474 3,997,113 3,455,051 3,348, including: Held for trading (1) 698, , ,725 1,372, Available for sale 2,774,716 1,974,570 1,548,112 1,319, Loans & Receivable 879, , , , Held to maturity 404, , ,914 66,479-4 (1) The breakdown does not correspond to the item 20 "Financial assets held for trading" as it is net of derivatives. Pursuant to the amendments made to international accounting principles IAS 39 and IFRS 7 in October and November 2008, Banca Carige reclassified securities, effective from 1 July and 1 October 2008, for a total residual value of euro million as at 30 September 2009 (fair value at the reclassification date), as detailed in the following table. RECLASSIFICATIONS OF FINANCIAL ASSETS (1) (figures in thousands of euro) (pursuant to the changes to IAS39 approved by IASB on 13/10/2008) FROM/TO AFS HTM L&R TOTAL HFT 346, , , ,295 AFS ,040 36,040 TOTAL 346, , , ,335 (1) Amounts net of accruals In the absence of said reclassifications the Group would have recorded, as at 30 September 2009: higher write-downs of euro 33.3 million (down by euro 59.0 million in the half compared with the euro 92.3 million as at 31 December 2008) which generated euro 23.6 million in higher negative reserves of shareholders equity (down by euro 34.7 million in the first nine month of the year); lower interest income pertaining to amortised cost for euro 5.6 million, of which euro 3.3 million relating to the first nine months of the year; greater negative reserves of shareholders equity of euro 0.3 million, up by euro 5.6 million compared with euro 5.9 million as at 31 December

98 These values are calculated before the respective taxes. The portfolio of debt securities reclassified in the AFS, HTM and L&R categories for a nominal total of euro million had an effective interest rate of 5.75% with expected cash flows estimated at euro 1,029.7 million. The downturn in the financial markets and problems facing leading financial institutions led supranational and national Supervisory Bodies to recommend operators employ maximum transparency toward shareholders and investors in the disclosure of the criteria used in determining the fair value of financial assets and liabilities classified in the categories HFT, AFS and classified under the FVO. The table below shows a summary, for the Carige Group, of the values and respective percentages of the different levels of Fair Value used for the evaluation of the financial instruments classified in the categories HFT (Held For Trading), AFS (Available For Sale) and classified under the Fair Value Option (FVO): for the definition of the different levels of fair value, instead refer to the same paragraph in the Explanatory Notes of the Consolidated Interim Financial Statements. As at 30 September 2009, valuation reserves relative to securities classified in the AFS (Available For Sale) category amounted to euro million (an increase of euro million compared with the positive balance of euro million at 31 December 2008) and composed of euro million of positive reserves, relating mainly to the valuation of the equity investment in the Bank of Italy (euro million), and of euro million of negative reserves. The latter refer, for euro 16.6 million, to debt securities (composed almost entirely of Government, bank and corporate bonds with high credit ratings) and for euro million to equities and shares in collective investment schemes of leading banking and insurance issuers (including Assicurazioni Generali S.p.A. for euro 56.5 million and four bank securities for euro 18.2 million). As regards the portion relative to equities, even though significant, that exceed quantitative impairment parameters defined by the model adopted by the Group (including a case with a negative reserve of euro 7.9 million which exceeds 80% of the decrease in fair value compared with the book value) the conditions of impairment were not deemed to exist following qualitative evaluations based on an analysis of the so-called fundamental aspects of the issuer that also took into consideration the economic results achieved in the first part of the current financial year as well as the performance in the months after the close of the half. LEVELS OF FAIR VALUE USED (figures in thousands of euro) Level 1 Level 2 Level 3 Countervalue % Countervalue % Countervalue % Financial assets 1,806, , , Financial liabilities 460, , Derivatives , Total 2,267, ,450, , % on Total 49.89% 31.90% 18.21% % on Total net of the equity investment in Bank of Italy 60.36% 38.60% 1.04% The value of assets from hedging derivatives amounted to euro 68.8 million, up compared with euro 53.2 million in December and euro 21.7 million in September The value of liabilities from hedging derivatives, at euro million, was higher than the euro million in December and euro 21 million in September A total of euro 18 million in revaluations and euro 72.2 million in write-downs were registered on hedging derivative contracts; changes in the underlying assets were positive for euro 56.3 million. 98

99 ASSETS FROM HEDGING DERIVATIVES BY HEDGE TYPE (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Asset hedging derivatives Fair value hedging interest rates Cash flow hedging General interest rate risk hedging Liability hedging derivatives 68,780 58,254 53,246 21, Fair value hedging 66,379 55,872 51,197 6, interest rates 66,379 55,872 51,197 6, Cash flow hedging General interest rate risk hedging 2,401 2,382 2,049 14, Total 68,780 58,254 53,246 21, LIABILITIES FROM HEDGING DERIVATIVES BY HEDGE TYPE (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Asset hedging derivatives 106,660 62,414 38,234 6,552 Fair value hedging 106,660 62,414 38,234 6,552 interest rates 106,660 62,414 38,234 6,552 Cash flow hedging General interest rate risk hedging Liability hedging derivatives 88,568 69,843 66,347 14, Fair value hedging , interest rates , Cash flow hedging General interest rate risk hedging 88,568 69,843 65,609 3, Total 195, , ,581 20, With reference to the notional values, the derivative contract amount equalled euro 8,194.5 million, up from December (+13.4%) and with respect to September 2008 (+25.8%). NOTIONAL VALUES OF DERIVATIVE CONTRACTS (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Financial derivatives 8,013,914 7,633,657 7,009,073 6,284, futures , forward agreements 291, , , , swap 6,459,824 5,866,827 4,873,721 4,579, options purchased 912, ,292 1,028, , others 349, , , , Credit derivatives 180, , , , tror 161 1,972 6,060 6, cds 180, , , , TOTAL 8,194,529 7,809,370 7,224,226 6,515, Trading derivative contracts totalled euro 256 million, an increase compared with the euro million in December (+16.1%), and euro 173 million in September 2008 (+48%). Revaluations of euro 49.5 million and writedowns of euro 70.7 million were recorded on the trading derivative contracts. Net trading profits amounted to euro 1.3 million. 99

100 TRADING DERIVATIVES (figures in thousands of euro) Situation as at Change % 30/9/09 30/6/09 31/12/08 30/9/08 9/09 9/09 12/08 9/08 Positive countervalues 103,475 97,252 82,045 73, Financial derivatives 102,562 93,860 70,406 63, forward agreements 9,648 9,268 10,939 19, swap 64,392 61,892 36,765 19, options purchased 28,522 22,700 22,702 24, Credit derivatives 913 3,392 11,639 10, cds 913 3,392 11,639 10, others Negative countervalues 152, , ,561 99, Financial derivatives 149, , ,595 98, forward agreements 4,309 6,518 11,360 9, swap 132, , ,924 66, issued options 12,241 11,402 11,311 22, Credit derivatives 3,497 3,070 2,966 1, tror cds 3,497 3,067 2,953 1, TOTAL 256, , , , Net income on derivative contracts was a negative euro 20.5 million; trading contracts made a negative contribution of euro 22.5 million while hedges recorded a positive net result of euro 2 million. NET INCOME ON DERIVATIVE CONTRACTS AS AT 30/9/2009 (figures in thousands of euro) Revaluations Write-downs Net profit Net income on trading 1. Trading contracts 49,466-70,654-1,344-22, Financial derivatives 48,625-58, , Credit derivatives ,179-1,799-13,137 Revaluations Write-downs Changes in underlying Net income from hedging 2. Hedging contracts 17,991-72,236 56,278 2, Asset hedging 3,072-69,232 66, Liability hedging 14,919-3,004-10,226 1,689 TOTAL 67, ,890 54,934-20,

101 ECONOMIC RESULTS As at 30 September 2009, the income statement posted a net profit of euro million against euro 191 million for the same period in INCOME STATEMENT (figures in thousands of euro) Change 9/09-9/08 30/9/09 30/6/09 31/12/08 30/9/08 absolute % 10 Interest income and similar revenues 733, ,735 1,227, , , Interest expenses and similar charges (323,509) (234,649) (633,963) (464,123) 140, NET INTEREST INCOME 410, , , ,242-18, Commission income 196, , , ,772 22, Commission expenses (21,355) (14,152) (32,210) (23,724) 2, NET COMMISSIONS 175, , , ,048 24, Dividends and other similar revenues 56,379 56,097 60,505 55, Net income from trading activities 6, (38,666) (31,335) 38, Net income from hedging activities 2,033 1,789 (393) 645 1, Profit (loss) on disposal or repurchase of: 15,896 10,558 12,668 13,314 2, a) loans 1,703 1,051 3,902 2, b) available-for-sale financial assets 2,708 (2,135) 9,593 8,297-5, d) financial liabilities 11,485 11,642 (827) 2,592 8, Net value adjustment on financial assets designated at fair value -1,176 1, ,048-17, GROSS OPERATING INCOME 665, , , ,881 32, Net value adjustments due to impairment to: (53,651) (39,436) (66,954) (64,423) 10, a) loans (51,389) (38,201) (60,894) (63,617) 12, b) available-for-sale financial assets (2,141) (1,531) (7,970) - -2,141 d) other financial assets (121) 296 1,910 (806) NET INCOME FROM FINANCIAL MANAGEMENT 611, , , ,458 42, Administrative costs (387,456) (269,393) (501,902) (360,669) -26, a) staff costs (1) (236,480) (163,984) (298,660) (209,270) -27, b) other administrative costs (1) (150,976) (105,409) (203,242) (151,399) Net provisions for risks and charges (2,553) (2,165) (2,148) 3,023-5, Depreciation of tangible assets (11,055) (7,253) (12,947) (8,653) -2, Amortization of intangible assets (12,638) (8,017) (13,415) (9,437) -3, Other operating expenses and revenues 48,499 30,209 57,040 47, OPERATING COSTS (365,203) (256,619) (473,372) (328,010) -37, Profit (loss) from equity investments (52) - (78) Profit (loss) from disposal of investments 12 (1) OPERATING PROFIT (LOSS) FROM ORDINARY ACTIVITIES BEFORE TAXES 246, , , ,473 5, Income taxes for the period (66,973) (39,766) (73,300) (49,497) -17, PROFIT (LOSS) FROM ORDINARY ACTIVITIES AFTER TAXES 179, , , ,976-11, PROFIT (LOSS) FOR THE PERIOD 179, , , ,976-11, (1) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". The figures as at September 2008 have been adequately reclassified to allow a homogeneous comparison. 101

102 INCOME STATEMENT - QUARTERLY RESULTS (figures in thousands of euro) 3 rd quarter rd quarter 2008 CHANGE 30/6/ /9/09 30/9/08 CHANGE 10 - INTEREST INCOME AND SIMILAR REVENUES 733, ,365 (158,783) 212, ,478 (103,631) 520, INTEREST EXPENSES AND SIMILAR CHARGES (323,509) (464,123) 140,614 (88,860) (167,856) 78,996 (234,649) 30 -NET INTEREST INCOME 410, ,242 (18,169) 123, ,622 (24,635) 286, COMMISSION INCOME 196, ,772 22,617 69,483 60,425 9, , COMMISSION EXPENSES (21,355) (23,724) 2,369 (7,203) (8,563) 1,360 (14,152) 60 -NET COMMISSIONS 175, ,048 24,986 62,280 51,862 10, , DIVIDENDS AND OTHER SIMILAR REVENUES 56,379 55, (207) 56, NET INCOME FROM TRADING ACTIVITIES 6,866 (31,335) 38,201 6,292 (7,520) 13, NET INCOME FROM HEDGING ACTIVITIES 2, , (340) 1, PROFIT (LOSS) ON DISPOSAL OR REPURCHASE OF: 15,896 13,314 2,582 5,338 1,043 4,295 10,558 a) loans 1,703 2,425 (722) ,051 b) available-for-sale financial assets 2,708 8,297 (5,589) 4,843 (120) 4,963 (2,135) d) financial liabilities 11,485 2,592 8,893 (157) 709 (866) 11, NET VALUE ADJUSTMENT ON FINANCIAL ASSETS AND LIABILITIES DESIGNATED AT FAIR VALUE (1,176) 16,048 (17,224) (2,233) 15,621 (17,854) 1, GROSS OPERATING INCOME 665, ,881 32, , ,701 (14,511) 468, NET VALUE ADJUSTMENTS DUE TO IMPAIRMENT OF: (53,651) (64,423) 10,772 (14,215) (21,580) 7,365 (39,436) a) loans (51,389) (63,617) 12,228 (13,188) (21,399) 8,211 (38,201) b) available-for-sale financial assets (2,141) - (2,141) (610) - (610) (1,531) d) other financial assets (121) (806) 685 (417) (181) (236) NET INCOME FROM FINANCIAL MANAGEMENT 611, ,458 42, , ,121 (7,146) 429, ADMINISTRATIVE COSTS: (387,456) (360,669) (26,787) (118,063) (127,138) 9,075 (269,393) a) staff costs (1) (236,480) (209,270) (27,210) (72,496) (70,226) (2,270) (163,984) b) other administrative costs (1) (150,976) (151,399) 423 (45,567) (56,912) 11,345 (105,409) NET PROVISIONS FOR RISKS AND CHARGES (2,553) 3,023 (5,576) (388) 2,990 (3,378) (2,165) DEPRECIATION OF TANGIBLE ASSETS (11,055) (8,653) (2,402) (3,802) (3,082) (720) (7,253) AMORTIZATION OF INTANGIBLE ASSETS (12,638) (9,437) (3,201) (4,621) (3,648) (973) (8,017) OTHER OPERATING EXPENSES AND REVENUES 48,499 47, ,290 15,717 2,573 30, OPERATING COSTS (365,203) (328,010) (37,193) (108,584) (115,161) 6,577 (256,619) PROFIT (LOSS) FROM EQUITY INVESTMENTS (52) - (52) (52) - (52) PROFIT (LOSS) FROM DISPOSAL OF INVESTMENTS (13) (12) (1) 250 -OPERATING PROFIT (LOSS) FROM ORDINARY ACTIVITIES BEFORE TAXES 246, ,473 5,738 73,352 73,985 (633) 172, INCOME TAXES FOR THE PERIOD (66,973) (49,497) (17,476) (27,207) (28,646) 1,439 (39,766) PROFIT (LOSS) FROM ORDINARY ACTIVITIES AFTER TAXES 179, ,976 (11,738) 46,145 45, , PROFIT (LOSS) FOR THE PERIOD 179, ,976 (11,738) 46,145 45, ,093 (1) By letter no dated 5 January 2009 (re: "Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". The figures as at September 2008 have been adequately reclassified to allow a homogeneous comparison. The net interest income amounted to euro million, down by 4.2%. Interest income amounted to euro million, down by 17.8%, and interest expense came to euro million, down by 30.3%. Interest income on financial assets sold but not cancelled included euro 18.2 million relating to the securitisation of performing mortgages, Argo Mortgage 2, carried out in 2004, and euro 5.4 million relating to Banca Carige securities, sold as repurchase agreements. The interest expense on financial liabilities associated with assets sold but still not cancelled included euro 12.4 million relating to the Argo Mortgage 2 transaction and euro 1.8 million relating to repurchase agreement transactions. The net interest income from customers, considering also the interest expense on securities in issue, amounting to euro million, was down by 13.3%, whereas there was a positive interbank balance of euro 25.3 million (against an essentially nil value in September 2008). INTEREST INCOME (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/ /09/08 absolute % Financial assets held for trading 15,847 13,396 52,033 32,856-17, Available-for-sale financial assets 31,487 17,447 25,702 17,561 13, Financial assets held to maturity 7,919 5,934 3,968 1,237 6,682 Loans to banks 35,914 27,331 77,805 59,708-23, Loans to customers * 618, ,508 1,005, , , Financial assets sold and not cancelled * 23,647 15,702 61,345 46,721-23, Other intangible ,267 1, TOTAL INTEREST INCOME 733, ,735 1,227, , , * Following some recent clarifications provided by the Bank of Italy, interest income on financial assets sold and not cancelled related to securitisation transactions for which no "derecognition" has taken place has been reclassified to loans to customers. 102

103 INTEREST EXPENSES (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/ /09/08 absolute % Amounts owed to banks 10,633 8,395 70,654 59,729-49, Amounts owed to customers 78,586 55, , ,531-21, Securities in issue 193, , , ,734-37, Financial liabilities designated at fair value 5,075 2,353 15,566 11,649-6, Financial liabilities corresponding to assets sold and not cancelled -27,684 14,163 10,790 53,370 41, Other liabilities ,323 3,132-2, Hedging derivatives 21,692 15,382 29,493 16,501 5, TOTAL INTEREST EXPENSES 323, , , , , Net commissions amounted to euro 175 million, up by 16.7% compared with the first nine months of Commission income stood at euro million, up by 13% on the figure for the first nine months of More specifically, there was a sharp increase in the item other services, which included the increase in commissions for syndicated loans, up from euro 1.8 million in September 2008 to the current euro 7.4 million, as a consequence of the development of activities in this type of loan. Commissions from the distribution of third party services also increased (euro 25.4 million; +33.5%), largely driven by those from insurance products, and those on payment and collection services (euro 39.3 million; +7.1%). On the other hand there was a decrease in commissions from the placement of securities (euro 22 million; -25.4%). Commission expense, at euro 21.4 million, fell by 10%. COMMISSION INCOME (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/ /09/08 absolute % Guarantees issued 6,895 4,385 9,095 6, Management, dealing and consultancy services: 68,268 44,697 88,942 66,150 2, Financial instruments trading 1, Currency trading 2,088 1,194 2,873 2, Asset management 5,169 3,572 7,551 5, Securities custody and administration 2,443 1,440 2,433 1, Custodian bank 2,581 1,534 3,861 3, Placement of securities 21,998 14,350 36,988 29,494-7, Collection of orders 7,541 5,073 7,823 5,316 2, Distribution of third-party services 25,356 16,920 27,073 18,990 6, asset management insurance products 13,370 8,958 14,239 10,048 3, other products 11,330 7,541 12,079 8,390 2, Collection and payment services 39,303 24,698 50,254 36,693 2, Servicing for securitizations 1,812 1,310 2,059 1, Factoring services 1, , Other services 79,069 51,079 88,970 62,514 16, TOTAL COMMISSION INCOME 196, , , ,772 22,

104 COMMISSION EXPENSES (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/09 2,008 30/09/08 absolute % Guarantees received Management and intermediation services 3,377 2,395 4,837 3, Financial instruments trading Asset management , Securities custody and administration 1, ,030 1, Financial instruments placement Door-to-door sale of securities, financial products and services Collection and payment services 11,504 7,364 17,468 12,999-1, Other services 6,160 4,151 9,236 6, TOTAL COMMISSION EXPENSES 21,355 14,152 32,210 23,724-2, Dividends and similar income amounted to euro 56.4 million (euro 55.9 million in September 2008). Net income from trading activities was a positive euro 6.9 million (negative for euro 31.3 million in September 2008), reflecting the recovery of the financial markets. Net income from hedging activities was a positive euro 2 million (euro 645 thousand in September 2008). INCOME FROM TRADING ACTIVITIES (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/ /09/08 absolute % Debt securities 31,871 23,090 (38,833) (35,373) 67,244 Equities & collective investment schemes 1, (5,402) (5,364) 6,906 Total equities, debt securities & collective investment schemes 33,413 24,023 (44,235) (40,737) 74,150 Financial derivatives (9,395) (8,584) (2,067) 6,895 (16,290) Credit derivatives (13,137) (9,520) 8,095 7,990 (21,127) Currency differences (133) (133) (3,941) (8,153) 8, Other financial assets/liabilities from trading (3,882) (5,212) 3,482 2,670 (6,552) INCOME FROM TRADING ACTIVITIES 6, (38,666) (31,335) 38,201 The profit from the sale of loans and financial assets/liabilities was equal to euro 15.9 million (euro 13.3 million in the first nine months of 2008), essentially as a result of the repurchase of financial liabilities. Net income from financial assets/liabilities designated at fair value was positive for euro 1.2 million (positive for euro 16 million in the first nine months of 2008). Gross operating income rose by 5.1% to euro million compared with the same period last year. Net value adjustments due to impairment to loans and other financial items amounted to euro 53.7 million, down against the figure recorded in the same period in 2008 (euro 64.4 million); this item included net value adjustments on loans that totalled euro 51.4 million, down compared with the first nine months of They derive from an estimate of adjustments of euro 96.8 million and write-backs totalling euro 45.4 million; the positive effects deriving from adoption of the statistical LGD (Loss Given Default) model contributed to these items, developed internally for the evaluation of insignificant bad loan positions (for more details see the section dedicated to impaired loans in Intermediation activities ); adjustments on financial assets available for sale (impairment) amounted to euro 2.1 million and refer to equities. Therefore, the net income from financial operations came to euro million, up by 7.6% compared with the first nine months of

105 NET VALUE ADJUSTMENTS TO LOANS AND OTHER FINANCIAL ITEMS (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/ /09/08 absolute % Loans to banks Loans to customers 51,281 38,089 60,724 63,617-12, Credit commitments (other financial transactions) 121 (296) (1,910) Available-for-sale financial assets 2,141 1,531 7,970-2,141 NET VALUE ADJUSTMENTS TO LOANS AND OTHER FINANCIAL ITEMS 53,651 39,436 66,954 64,423-10, Operating costs amounted to euro million, an increase of 11.3% compared with the first nine months of In detail, administrative costs amounted to euro million, up by 7.4% over the twelvemonth period and within these: - staff costs, increased by 13% to euro 236 million; - other administrative costs amounted to euro 151 million (-0.3% against September 2008), mainly reflecting the containment of general expenses (-2.3% in the twelve month period). Net provisions for risks and charges stood at euro 2.6 million against a write-back of euro 3 million in the first nine months of the previous year. Value adjustments on tangible and intangible fixed assets amounted to euro 23.7 million, an increase of 31% in the twelve months. OPERATING COSTS (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/ /09/08 absolute % Staff costs (1) 236, , , ,270 27, Other administrative costs (1) 150, , , ,399 (423) general costs 120,488 84, , ,339 (2,851) indirect taxes 30,488 20,604 40,282 28,060 2, Net provisions for risks and charges 2,553 2,165 2,148 (3,023) 5,576 Amortization and depreciation on: 23,693 15,270 26,362 18,090 5, intangible fixed assets 12,638 8,017 13,415 9,437 3, tangible fixed assets 11,055 7,253 12,947 8,653 2, Other operating expenses and revenues (48,499) (30,209) (57,040) (47,726) (773) 1.6 TOTAL OPERATING COSTS 365, , , ,010 37, (1) By letter no dated 5 January 2009 ("Regulations on bank financial statements"), the Bank of Italy has established, inter alia that conventionally fees paid to the statutory auditors have to be recorded under sub-item "a) staff costs" and not under item "b) other administrative expenses". Figures relating to the third quarter of 2008 were modified by reclassifying an amount equal to euro 188 thousand from sub-item "b) other administrative expenses" to sub-item "a) staff costs" in order to allow a homogeneous comparison among different periods. Other net operating revenues rose slightly (+1.6%) to euro 48.5 million. OTHER OPERATING REVENUES AND EXPENSES (figures in thousands of euro) Change 9/09-9/08 30/09/09 30/06/ /09/08 absolute % Lease income and rent 2,468 1,563 3,346 2, Charges to third parties: 27,613 18,431 35,329 26,594 1, recovery of taxes 26,674 17,805 34,085 25,664 1, customer insurance premiums , Other revenues 23,998 14,295 31,402 22,777 1, Total other revenues 54,079 34,289 70,077 51,846 2, Operating costs on financial leases (289) (190) (2,027) (1,748) 1, Ordinary maintenance costs on investment property (310) (241) (473) (345) Expenses for improvement of third parties assets (651) (434) (998) (651) - - Other expenses (4,330) (3,215) (9,539) (1,376) -2,954 Total other expenses (5,580) (4,080) (13,037) (4,120) -1, TOTAL NET REVENUES 48,499 30,209 57,040 47,

106 Profit before taxes amounted to euro million, an increase of 2.4% compared with the first nine months of Provisions for income taxes stood at euro 67 million, a sharp increase compared with the euro 49.5 million in September 2008, which benefitted from non-recurring positive effects, amounting to euro 25.7 million, attributable mainly to the application of substitute taxes on off-balance sheet differences. Net profit therefore amounted to euro million, down by 6.1% compared with the euro 191 million in the same period in the previous year. With regard to the distribution of dividends please refer to the paragraph Dividends distributed by the Parent Bank Banca Carige contained in the explanatory notes of the consolidated interim financial statements. TRANSACTIONS WITH RELATED PARTIES Asset and liability relations with shareholders who are able to exercise a significant influence, relations with investee companies (subsidiaries subject to considerable influence) and with other related parties (excluding the fees paid to Directors and Statutory Auditors, which are published annually in the Explanatory Notes to the Consolidated Financial Statements) as at 30 September 2009 were as follows: RELATIONS WITH SHAREHOLDERS AND WITH INVESTEE COMPANIES (figures in thousands of euro) 30/9/09 Assets Liabilities Guarantees Dividends Other revenues Expenses and commitments distributed CARIGE SHAREHOLDERS WHO EXERCISE A SIGNIFICANT INFLUENCE 4, , Fondazione Cassa di Riparmio di Genova e Imperia 4, , Caisses d'epargne Participations - Groupe BPCE ,

107 30/9/09 Activity Liabilities Guarantees Dividends Other revenues Expenses and commitments collected SUBSIDIARIES 1,118, ,039 14,841 46, ,790 24,023 Cassa di Risparmio di Carrara SpA 308,186 28,046-16,826 21,826 6,549 Cassa di Risparmio di Savona SpA 174,388 54, ,063 22,460 6,481 Banca del Monte di Lucca SpA 256,727 21,744 1,080 4,752 8,986 1,685 Banca Cesare Ponti SpA 80,010 24,197-1,253 6, Carige Asset Management Sgr SpA 5,728 8,878-2,044 17, Centro Fiduciario SpA Argo Finance One Srl Argo Mortgage Srl Argo Mortgage 2 Srl Priamar Finance Srl Galeazzo Srl 18 3, Columbus Carige Immobiliare SpA 14,734 1, ,214 Immobiliare Ettore Vernazza SpA Carige Vita Nuova SpA 7, , ,941 4,737 Carige Assicurazioni SpA 52,484 24,472 11,811-4, Assi 90 Srl 45 1, Dafne Immobiliare Srl IH Roma Srl - 1, Creditis Servizi Finanziari SpA 218,207 4,353 1,700-7, Carige Covered Bond Srl ENTITIES SUBJECT TO SIGNIFICANT INFLUENCE - 14, Autostrada dei Fiori SpA - 11, Assimilano Srl Recina Servizi SpA - 2, Consorzio per il Giurista d'impresa Srl Sport e Sicurezza Srl WTC SPA in liq Nuova Erzelli Srl TOTAL 1,118, ,930 14,891 46, ,807 24,159 RELATIONS WITH OTHER RELATED PARTIES (figures in thousands of euro) Assets Liabilities Guarantees and commitments Revenues Expenses Purchase of goods and services Other related parties 40,452 9,742 10,694 1, TOTAL 40,452 9,742 10,694 1, For the definition of other related parties, refer to the paragraph "Transactions with related parties" in the Explanatory Notes to the Consolidated Interim Financial Statements. RESULTS BY ECONOMIC BUSINESS SECTOR The information on business sector activities is provided at consolidated level. 107

108 SHAREHOLDERS' EQUITY REGULATORY CAPITAL AND SOLVENCY RATIOS (figures in thousands of euro) Situation as at 30/9/09 30/6/09 31/12/08 30/9/08 (1) (2) Regulatory capital Core Tier 1 Capital 1,526,226 1,526,222 1,524,746 1,682,227 Tier 1 capital 1,686,126 1,686,122 1,684,646 1,682,227 Tier 2 capital 767, , , ,745 less: deductions -349, , , ,436 Total capital 2,104,221 2,104,249 2,087,180 1,931,536 Tier 3 capital 97,175 97,175 99,675 99,675 Tier 3 calculable portion 18,380 16,150 30,320 34,531 Regulatory capital including Tier 3 2,122,600 2,120,399 2,117,501 1,966,066 Weighted assets Credit risk 15,645,904 15,273,610 14,848,358 14,239,378 Market risk 429, , , ,530 Operational risk 1,446,462 1,446,462 1,446,462 1,318,399 Other prudential requirements Total weighted assets 17,521,395 17,097,057 16,825,637 16,162,307 Capital requirements Credit risk 1,251,672 1,221,889 1,187,869 1,139,150 Market risk 34,322 30,159 42,465 48,362 Operational risk 115, , , ,472 Other prudential requirements Capital reduction by 25% 350, , , ,246 Total requirements 1,051,284 1,025,823 1,009, ,738 Surplus capital 1,071,316 1,094,575 1,107, ,328 Solvency ratios (%) Tier 1 capital/credit risk weighted assets 10.78% 11.04% 11.35% 11.81% Regulatory capital/credit risk weighted assets 13.45% 13.78% 14.06% 13.56% Core Tier 1/Total Risk-Weighted Assets 8.71% 8.93% 9.06% 10.41% Tier 1 capital/total weighted assets 9.62% 9.86% 10.01% 10.41% Regulatory capital including Tier 3 capital/total weighted assets 12.11% 12.40% 12.58% 12.16% Figures rounded up to thousands of euro (1) Figures as at 30/06/2009 are the official figures and therefore they differ from the management data shown in the half-year report. (2) Figures as at 30/09/2008 differ from those reported to the Bank of Italy on 25/10/2008 as they take into account the estimates resulting from the reclassification of the portfolio securities carried out after the reporting date and implemented in compliance with the modifications to IAS 39 approved on 13/10/2008 by IASB and published in the Official Gazette of the European Union L 275 on 16/10/2008. Genoa, 9 November 2009 The Board of Directors 108

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110 DECLARATION OF THE MANAGER RESPONSIBLE FOR PREPARING THE COMPANY S FINANCIAL REPORTS PURSUANT TO PARAGRAPH 2 OF ART. 154-bis OF THE CONSOLIDATED LAW ON FINANCE I the undersigned Daria Bagnasco, Planning and Accounting Head Office Manager of Banca CARIGE S.p.A., in my capacity as Manager responsible for preparing the Company s financial reports declare that the accounting information contained in the Interim report on operations of the Banca CARIGE Group as at 30 September 2009 corresponds to the document results, books and accounting records. Genoa, 9 November 2009 The Manager responsible for preparing the Company s financial reports Daria Bagnasco [signed on the original] This document has been translated into the English language solely for the convenience 110 of international readers

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