BANK HANDLOWY W WARSZAWIE S.A. Initial 2Q 2009 consolidated financial results -1-

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1 BANK HANDLOWY W WARSZAWIE S.A. Initial 2Q 29 consolidated financial results -1-

2 Macroeconomic situation in 2Q Gradual improvement in industrial output thanks to weaker exchange rate Jan-8 Apr-8 Jul-8 Oct-8 Jan-9 Apr-9 PMI Index Industrial output YoY(Rigth axis) Imports decline at a faster pace than exports thus contributing to improvement in trade balance Jan-8 Apr-8 Jul-8 Oct-8 Jan-9 Apr-9 Exports YoY Imports YoY PLN strengthens on the back of improved market sentiment and stronger fundamentals 12, 115, 11, 15, 1, 95, Jan-9 Feb-9 Mar-9 Apr-9 May-9 Jun-9 6,5 6, 5,5 5, 4,5 4, 3,5 3, 2,5 2, MPC cuts rates by 15bps to 3.5% in 1H 29 Jan-8 Apr-8 Jul-8 Oct-8 Jan-9 Apr-9 EURPLN EURRON EURCZK CPI YoY NBP reference rate Source: Citi Handlowy, GUS, NBP -2-

3 An improvement in Bank s results Operating margin: PLN 274 million - an increase of 2% as compared to the second quarter of 28 and 25% as compared to the first quarter of 29. Operating income: PLN 626 million an increase of 3% as compared to the second quarter of 28 and 6% as compared to the first quarter of 29. Operating expenses: PLN 352 million a decrease of 8% as compared to the second quarter of 28 and 6% as compared to the first quarter of 29. The growth of cost effectiveness (cost/ income ratio): it decreased to the level of 56%which constituteda7ppdecreaseas comparedto thesecondquarter of 28 and a 7 pp decrease as compared to the first quarter of 29. Capital adequacy ratio: 13.5% - an increase of 1.9 pp as compared to the second quarter of 28 and 2.3 pp as compared to the first quarter of 29. Loans to deposits ratio: 69% - no change as compared to the second quarter of 28 and a decrease of 4 pp as compared to the first quarter of

4 Increase of operating margin in the last two quarters % 63% 56% 9% 8% 7% 6% 5% /PLN mln/ market +13% 59% market +18% 25% % 3% 2% 1% % Q 8 1Q 9 2Q 9-1% 4Q 8 1Q 9 2Q 9 Income Cost C/I Operating margin Increase of operating margin in the last two quarters above the market, thanks to: better cost effectiveness in the last two quarters a decrease of Cost/Income ratio (C/I) to 56% stable increase in income Operating margin = income - cost -4-

5 Net income NET INCOME 2Q28 Interests Fees Treasury Expenses Net impairment Loans Net impairment FX Options tax Other NET INCOME 2Q29 18% 2% 8% 97 MM 68 MM (2Q9/2Q8) Net interest income (2Q9/2Q8) Fee & commision income (2Q9/2Q8) Expenses and depreciation (2Q9/2Q8) Net impairment losses loans (2Q9/2Q8) Net impairment FX Options market -9% market +9% market +3% -5-

6 FX Options impact on Bank s income Q 8 2Q 8 3Q 8 4Q 8 1Q 9 2Q Q 29 3 FX Options (PLN 59 MM) * Profit before tax 2Q29 excl. FX Options *Including FX Options hedging Treasury Net impairment losses -6- Profit before tax 2Q29

7 Stable Bank s position Strong capital base (CAR) High liquidity (Loans/Deposits) 14% 12% 1% 11.6% 1.9% 12.3% 11.6% 12.1% 11.2%* 11.2% 11.2% 13.5% 12.5% 12% 1% 99% 13% 19% 111% 17% 8% 8% 69% 71% 7% 73% 69% 6% 2Q '8 3Q '8 4Q '8 1Q '9 2Q '9 6% 2Q '8 3Q '8 4Q '8 1Q '9 2Q '9 Citi Handlowy Banking sector Min. requirement Citi Handlow y Banking sector * not including 28 net income High and stable level of equity PLN MMM Q '8 3Q '8 4Q '8 1Q '9 2Q '9 Citi Handlowy The Bank's solvency and liquidity ratios are regularly monitored and they are well above the regulatory minimums. As at the end of 2Q 29 Citi Handlowy loans to deposits ratio amounted to.69, one of the lowest in the market. Citi Handlowy maintains stable capital base Source: Citi Handlowy, NBP -7-

8 An increase in net interest margin Net interest income and net interest margin 44% (2Q9/2Q8) Deposits cost non-financial sector 95% (2Q9/2Q8) Debt securities portfolio income Market share 2Q8 1Q9 2Q9 4.4% 5.8% 5.8% 45 4 Net interest result Net interest margin Net interest margin (market) 3.8% 3.6% % 3.2% 3.% 2.8% 15 2Q7 3Q7 4Q7 1Q8 2Q8 3Q8 4Q8 1Q9 2Q9 2.6% -8-

9 A first QoQ increase in fee & commision result in two years Net fee & commission income 32% 14% 21% Market share (2Q9/2Q8) Investment and insurance products (2Q9/2Q8) Payment and credit cards (2Q9/2Q8) Custody services 2Q8 1Q9 2Q9 5.7% 4.4% 4.2% 25 Increase of net fee & commission income in 2Q % 1 5 2Q7 3Q7 4Q7 1Q8 2Q8 3Q8 4Q8 1Q9 2Q9-9-

10 Stable customer activity result Treasury 2Q 28 2Q 29 I/D (PLN MM) (2.7) Customer activity Customer activity result Proprietary management Proprietary management result FXO 9 mln* FXO (259 mln) FXO (15 mln) 1Q 7 2Q 7 3Q 7 4Q 7 1Q 8 2Q 8 3Q 8 4Q 8 1Q 9 2Q 9 *Including FX Options hedging 1Q 7 2Q 7 3Q 7 4Q 7 1Q 8 2Q 8 3Q 8 4Q 8 1Q 9 2Q 9 Scale on charts is incomparable -1-

11 Increase in impairment losses due to worsening market conditions Net impairment losses* 2Q 28 2Q 29 I/D (PLN MM) (113.) (15.9) (97.1) 4 Net impairment losses* (1) (6) (11) (16) 2Q7 3Q7 4Q7 1Q8 2Q8 3Q8 4Q8 1Q9 2Q9 Higher provision on IBNR (incurred, not reported losses) as a result of slowdown in the economy Additional provisions as a result of part of the loan portfolio sale *excl. FX Options Corporate banking Retail banking Higher provision on IBNR (incurred, not reported losses) as a result of slowdown in the economy Growing credit cards and loans portfolio Increase of delinquent receivables share -11-

12 Expenses under control market +3% (8%) (6%) (1%) Cost / Income 2Q8 2Q9 Corporate Banking 57% 43% Retail Banking 68% 75% Total 63% 56% Corporate Banking: lower staff expenses and decrease of depreciation Retail Banking: lower staff expenses and lower marketing expenses Q28 2Q29 Corporate Banking Retail Banking -12-

13 Loans Non-financial sector loans /PLN MMM/ Corporate loans Gross loans non-financial sector Currency structure 9% 85% 12% 16% 15% 88% 84% /PLN MMM/ Retail loans PLN FX Market 34% 66% 2Q29/1Q29 Market 2Q29/1Q29 2Q29/1Q29 Market 2Q29/1Q29 Changes (7%) (3%) Changes* 2% 3% Corporate loans: including public sector and local government institutions -13- *excl. mortgage

14 Deposits Non-financial sector deposits /PLN MMM/ 14 Corporate deposits Deposits non-banking sector Currency structure /PLN MMM/ 6 Retail deposits % 79% 22% 78% 21% 83% Current Term PLN FX Current Term Changes 2Q29/1Q29 Market 2Q29/1Q29 Market Changes 2Q29/1Q29 Market 2Q29/1Q29 Current Term (2%) 5% 9% % 9% 1% Current Term % 1% 9% (2%) Total 3% 3% Total % 2% Corporate deposits including public sector and local government institutions -14-

15 Summary Proper long term strategy of the Citi Handlowy for the crisis as well Stability and liquidity An increase in income and in effectiveness (C/I) A decrease in expenses Growing operating margin Success of the strategy in deposits scope -15-