Translation from the original prepared in Spanish for publication in Argentina

Translation from the original prepared in Spanish for publication in Argentina Financial statements as of June 30, 2017 jointly with the Independent auditors report on review of interim financial statements and the Supervisory Audit Committee s report

Translation from the original prepared in Spanish for publication in Argentina BANCO PATAGONIA S.A. FINANCIAL STATEMENTS AS OF JUNE 30, 2017 CONTENTS Page Independent auditors report on review of interim financial statements Cover page... 1 Statements of financial position... 2 Statements of income... 7 Statements of changes in shareholders equity... 9 Statements of cash flows and cash equivalents... 10 Notes to the financial statements... 12 Exhibit A - Breakdown of government and corporate securities... 56 Exhibit B - Financing facilities classified by status and guarantees received... 58 Exhibit C - Financing-facilities concentration...... 60 Exhibit D - Financing facilities broken down by term... 61 Exhibit E - Breakdown of investments in other companies... 62 Exhibit F - Changes in property, plant and equipment and miscellaneous assets... 63 Exhibit G - Breakdown of intangible assets... 65 Exhibit H - Deposits concentration... 66 Exhibit I - Breakdown by term of deposits, other liabilities from financial intermediation and subordinated corporate bonds... 67 Exhibit J - Changes in allowances and provisions... 68 Exhibit K - Capital structure... 69 Exhibit L - Balances in foreign currency... 70 Exhibit N - Credit assistance to related parties... 71 Exhibit O - Derivative financial instruments... 72 Consolidated financial statements... 73 Reporting summary Supervisory Audit Committee s Report on interim financial statements

Translation from the original prepared in Spanish for publication in Argentina INDEPENDENT AUDITORS REPORT ON REVIEW OF INTERIM FINANCIAL STATEMENTS To the President and Directors of Banco Patagonia S.A. Registered office: Av. de Mayo 701, Floor 24 Taxpayer Identification No. [C.U.I.T.] No. 30-50000661-3 City of Buenos Aires Report on the financial statements We have examined the accompanying interim financial statements of Banco Patagonia S.A. ( the Bank ), which include the statement of financial position as of June 30, 2017, the statements of income, changes in shareholders equity and cash flows and cash equivalents for the six-month period then ended, Notes 1 to 25, and Exhibits A, B, C, D, E, F, G, H, I, J, K, L, N and O. We have also examined the accompanying consolidated financial statements of Banco Patagonia S.A. and its subsidiaries, which include the consolidated statement of financial position as of June 30, 2017, and the consolidated statements of income and cash flows and cash equivalents for the six-month period then ended, Notes 1 to 10, and Exhibit 1, which are presented as supplementary information. The figures and other information as of December 31, 2016 and for the six-month period ended June 30, 2016 are an integral part of the financial statements mentioned above, and are presented for the purpose of being construed solely in relation to the figures and other information for the current interim period. Board of Directors and Management responsibility for the financial statements The Board of Directors and Management are responsible for the preparation and fair presentation of the accompanying interim financial statements in accordance with the accounting standards established by the Argentine Central Bank ( BCRA ). This responsibility includes designing, implementing and maintaining any such internal control as the Board of Directors and Management determine is necessary for the financial statements to be free from material misstatement. Auditors responsibility and scope of the review Our responsibility is to express a conclusion on the accompanying interim financial statements based on our review. We conducted our review in accordance with the standards set forth by Technical Resolution No. 37 of the Argentine Federation of Professional Councils of Economic Sciences (FACPCE) and the Minimum Standards applicable to External Audits set forth by the BCRA for the review of interim financial statements. In accordance with such standards, a review is limited primarily to the performance of analytical and other review procedures applied to financial data included in the interim financial statements and inquiries of personnel responsible for the preparation thereof. A review is substantially less in scope than an audit conducted in accordance with auditing standards in force, and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion on the interim financial statements.

Translation from the original prepared in Spanish for publication in Argentina Conclusion Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim financial statements do not present fairly, in all material respects, the financial position of the Bank as of June 30, 2017, the results of its operations, the changes in shareholders equity and cash flows and cash equivalents for the six-month period then ended, as well as the consolidated financial position of the Bank with its subsidiaries as of June 30, 2017, the consolidated results of its operations and consolidated cash flows and cash equivalents for the six-month period then ended, in conformity with accounting standards established by the BCRA. Emphasis paragraph Without modifying our conclusion, we draw users attention to the information presented in the Notes to the accompanying financial statements: a) As disclosed in Note 3 to the stand-alone financial statements, such financial statements have been prepared by the Bank s Board of Directors and Management in compliance with the accounting standards set forth by the BCRA, which differ in terms of certain valuation and presentation criteria from the professional accounting standards in force in the City of Buenos Aires, Argentina, described in Note 3. b) As indicated in Note 4 to the stand-alone financial statements, the items and figures contained in the reconciliation included therein are subject to changes, and will be only considered definitive when preparing the annual financial statements for the fiscal year in which the International Financial Reporting Standards (IFRS) are first adopted, as provided for by BCRA Communication A 5541 and supplementary information, which as a whole are the IFRS adopted by the BCRA, and which differ from the IFRS, as paragraph 5.5. Impairment of Value of IFRS 9 is temporarily exempted. Report on other legal and regulatory requirements In compliance with legal provisions in force, we report that: 1. The accompanying stand-alone interim financial statements have been transcribed into the Inventory Book, and arise from the Bank s accounting records, which, in their formal aspects, are kept pursuant to the legal provisions in force. The information systems used to generate the information included in the financial statements are kept under the security and integrity conditions based on which they were duly authorized; 2. As of June 30, 2017, the Bank records the minimum shareholders equity and counterparty required by the Argentine Securities Commission (CNV), as mentioned in Note 15 to the stand-alone accompanying financial statements; 3. the accompanying consolidated financial statements have been transcribed into the Inventory Book and prepared by the Bank s Board of Directors and Management, in their significant aspects, in compliance with consolidation standards set forth by Communications A 2227 and 2349 of the BCRA, which are disclosed in notes 1 to 10 to such consolidated financial statements; 4. as of June 30, 2017, there is no evidence of noncompliance with the significant aspects of the monetary and technical regulations set forth by the BCRA in relation to information provided to the BCRA on consolidated bases;

Translation from the original prepared in Spanish for publication in Argentina 5. we reviewed the reporting summary (sections Highlights, Comparative consolidated financial position items, Comparative consolidated profit or loss items, "Comparative consolidated statement of cash flows", Summary of main ratios and Additional information required by section 12 of chapter III, title IV of CNV regulations ), based on which, as far as it relates to our area of responsibility, we have no observations; and 6. as of June 30, 2017, the accrued liability for retirement and pension contributions payable to the Argentine Pension Fund System arising from the accounting records amounted to $ 83,430,598, no amounts being due as of that date. City of Buenos Aires, August 7, 2017. Registered with the C.P.C.E.C.A.B.A.Volume 2 Page 6 Marcelo A. Castillo Partner Public Accountant (UBA) Tº CLXIX Fº 52

Translation from the original prepared in Spanish for publication in Argentina BANCO PATAGONIA S.A. Registered office: Avenida de Mayo 701, Floor 24 City of Buenos Aires Argentina Main business activity: Commercial bank Taxpayer identification No. [C.U.I.T.]: 30-50000661 - 3 Incorporation date: May 4, 1928 Registration with the Public Registry of Commerce of the City of Buenos Aires Date Book of the articles of incorporation: 09/18/1928 of the latest amendment: 07/13/2017 Stock Companies Book: 85 Number: 13826 Expiration of articles of incorporation: August 29, 2038 Fiscal year No. 94 Beginning date: January 1, 2017 Closing date: December 31, 2017 Capital structure (Note 8 and Exhibit K) Number and characteristics of shares Subscribed In Argentine pesos Paid in 719,145,237 registered, common shares, with a nominal value of ARS 1, one vote each 719,145,237 719,145,237 Information required by the BCRA (Central Bank of Argentina) Name of the undersigned auditor: Professional firm: Report for the six-month period ended June 30, 2017 Marcelo A. Castillo 8 (quarterly closing Unqualified conclusion) 1

STATEMENT OF FINANCIAL POSITION AS OF 06/30/2017 AND 12/31/2016 (Stated in thousands of pesos) ASSETS 06/30/2017 12/31/2016 A. Cash and due from banks Cash on hand 2,659,069 2,488,186 Financial institutions and correspondents 8,589,496 8,177,047 BCRA 8,138,089 7,343,095 Other in Argentina 327 355 Other abroad 451,080 833,597 11,248,565 10,665,233 B. Government and corporate securities (Exhibit A) Holdings carried at fair market value 553,390 1,330,196 Holdings carried at cost plus yield 1,037,288 1,653,161 Instruments issued by the BCRA 14,434,200 9,407,417 Investments in listed corporate securities 125 147 16,025,003 12,390,921 C. Loans To the nonfinancial government sector (Exhibits B, C and D) 413,076 483,707 To the financial sector (Exhibits B, C and D) 2,043,862 2,214,065 Interbank loans (call options granted) 90,000 410,000 Other financing facilities granted to local financial institutions 1,737,146 1,645,374 Accrued interest, adjustments and listed-price differences receivable 216,716 158,691 To the nonfinancial private sector and foreign residents (Exhibits B, C and D) 41,225,410 39,013,643 Overdrafts 3,958,938 4,741,856 Notes 16,123,941 16,008,131 Mortgage loans 52,655 29,802 Consumer 7,425,081 5,990,475 Credit cards 8,097,548 7,368,363 Other 5,172,531 4,388,442 Accrued interest, adjustments and listed-price differences receivable 524,219 596,466 (Documented interest) (129,503) ( 109,892) (Allowances) (Exhibit J) ( 1,462,329) ( 1,280,729) 42,220,019 40,430,686 2

STATEMENT OF FINANCIAL POSITION AS OF 06/30/2017 AND 12/31/2016 (Stated in thousands of pesos) ASSETS Continued 06/30/2017 12/31/2016 D. Other Receivables from Financial Intermediation BCRA 1,197,801 793,750 Amounts receivable from spot sales to be settled and forward sales 11,423,319 487,035 Securities receivable from spot purchases to be settled and forward purchases 1,244,971 161,069 Unlisted corporate bonds (Exhibits B, C and D) 60,651 82,402 Unsettled amounts of forward transactions without delivery of underlying asset 80,225 10,312 Other not covered by Debtor Classification Standards 65,486 10,725 Other covered by debtor classification standards (Exhibits B, C and D) 90,467 17,772 Accrued interest and adjustments receivable covered by Debtor Classification Standards 113 128 (Exhibits B, C and D) (Allowances) (Exhibit J) ( 7,152) ( 4,888) 14,155,881 1,558,305 E. Receivables from Finance Leases Receivables from finance leases (Exhibits B, C and D) 1,474,002 1,458,360 Accrued interest and adjustments receivable (Exhibits B, C and D) 14,339 15,187 (Allowances) (Exhibit J) ( 17,490) ( 22,248) 1,470,851 1,451,299 F. Investments in other companies (Exhibit E) In financial institutions 1,144,457 1,248,822 Other 193,848 167,409 1,338,305 1,416,231 G. Miscellaneous Receivables Other (Note 5) 1,215,630 754,890 Other accrued interest and adjustments receivable 797 785 (Allowances) (Exhibit J) ( 12,220) ( 23,332) 1,204,207 732,343 H. Property, plant and equipment (Exhibit F) 595,303 604,573 I. Miscellaneous assets (Exhibit F) 201,196 207,523 J. Intangible assets (Exhibit G) Organization and development expenses 98,233 69,909 98,233 69,909 K. Items pending allocation 4,174 6,497 TOTAL ASSETS 88,561,737 69,533,520 3

STATEMENT OF FINANCIAL POSITION AS OF 06/30/2017 AND 12/31/2016 (Stated in thousands of pesos) LIABILITIES 06/30/2017 12/31/2016 L. Deposits (Exhibits H and I) Nonfinancial public sector 4,502,601 3,297,391 Financial sector 19,869 35,410 Nonfinancial private sector and foreign residents 51,347,718 48,455,612 Checking accounts 7,689,388 7,104,464 Savings accounts 19,912,078 18,053,859 Time deposit 20,912,581 18,502,171 Investment accounts 6,810 6,209 Other 2,441,140 4,361,134 Accrued interest, adjustments and listed-price differences payable 385,721 427,775 55,870,188 51,788,413 M. Other liabilities from financial intermediation BCRA (Exhibit I) 9,686 12,513 Banks and international organizations (Exhibit I) 1,547,484 1,824,301 Unsubordinated corporate bonds (Note 9) - 332,200 Amounts payable for spot purchases to be settled and forward purchases 1,161,519 145,862 Securities to be delivered under spot sales to be settled and forward sales 12,648,166 528,591 Financing facilities received from local financial institutions (Exhibit I) 772,433 252,697 Interbank loans 546,600 72,900 Other financing facilities from local financial institutions 225,425 179,664 Accrued interest payable 408 133 Unsettled amounts of forward transactions without delivery of underlying asset 28,241 11,606 Other (Exhibit I) 3,758,829 3,455,282 Accrued interest, adjustments and listed-price differences payable (Exhibit I) 29,781 41,293 19,956,139 6,604,345 N. Miscellaneous liabilities Dividends payable Fees 1,634,497 1,932-1,932 Other (Note 5) 1,763,993 1,758,608 3,400,422 1,760,540 O. Allowances (Exhibit J) 139,578 134,846 Q. Items pending allocation 11,922 10,124 TOTAL LIABILITIES 79,378,249 60,298,268 SHAREHOLDERS EQUITY (as per related statements) 9,183,488 9,235,252 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY 88,561,737 69,533,520 4

STATEMENT OF FINANCIAL POSITION AS OF 06/30/2017 AND 12/31/2016 (Stated in thousands of pesos) MEMORANDUM ACCOUNTS 06/30/2017 12/31/2016 DEBIT BALANCE Contingent Loans obtained (unused amounts) 661 3,009 Guarantees received 17,538,915 15,320,053 Other not covered by debtor classification standards 558 558 Contingent debit-balance contra accounts 2,684,236 2,964,055 20,224,370 18,287,675 Control Receivables classified as irrecoverable 619,395 587,469 Other (Note 5) 66,034,081 43,286,265 Control debit-balance contra accounts 6,291,737 5,575,842 72,945,213 49,449,576 Derivatives Notional value of forward transactions without delivery of underlying asset (Exhibit O and Note 11) 1,554,406 1,544,697 Interest rate swap (Exhibit O and Note 11) 800,000 - Derivative debit-balance contra accounts 1,546,152 2,631,690 3,900,558 4,176,387 Trust activity (Note 12) Trust funds 1,710,782 2,192,070 1,710,782 2,192,070 DEBIT-BALANCE MEMORANDUM ACCOUNTS 98,780,923 74,105,708 5

STATEMENT OF FINANCIAL POSITION AS OF 06/30/2017 AND 12/31/2016 (Stated in thousands of pesos) MEMORANDUM ACCOUNTS Continued 06/30/2017 12/31/2016 CREDIT BALANCE Contingent Loans granted (unused amounts) covered by debtor classification standards (Exhibits B, C and 1,942,454 2,180,698 D) Other guarantees provided covered by debtors classification standards (Exhibits B, C and D) 138,957 112,264 Other guarantees provided not covered by debtors classification standards 92,531 98,455 Other covered by debtors classification standards (Exhibits B, C and D) 320,666 368,462 Other not covered by debtor classification standards 189,628 204,176 Contingent credit-balance contra accounts 17,540,134 15,323,620 20,224,370 18,287,675 Control Checks and securities to be credited 1,261,890 1,070,333 Other 5,029,847 4,505,509 Control credit-balance contra accounts 66,653,476 43,873,734 72,945,213 49,449,576 Derivatives Notional value of forward transactions without delivery of underlying asset (Exhibit O and Note 1,546,152 2,631,690 11) Derivatives credit-balance contra accounts 2,354,406 1,544,697 3,900,558 4,176,387 Trust activity Trust activity credit-balance contra accounts 1,710,782 2,192,070 1,710,782 2,192,070 TOTAL CREDIT-BALANCE MEMORANDUM ACCOUNTS 98,780,923 74,105,708 The accompanying notes 1 to 25, exhibits A to L, N and O are an integral part of these financial statements. 6

STATEMENT OF INCOME For the six-month period ended 06/30/2017 and 06/30/2016 (amounts stated in thousands of pesos) BREAKDOWN 06/30/2017 6/30/2016 A. FINANCIAL INCOME Interest on loans to the financial sector 258,401 211,453 Interest on overdrafts 734,972 1,162,357 Interest on notes 1,239,732 1,530,682 Interest on mortgage loans 1,788 1,873 Interest on credit card loans 709,377 631,745 Interest on other loans 1,437,214 888,331 Interest on other receivables from financial intermediation 1,125 759 Interest on finance leases 154,481 142,185 Net income from government and corporate securities 795,783 1,868,923 Income from secured loans Presidential Decree No. 1387/01 1,486 117 Adjustments under CER clause 3,290 3,442 Gold and foreign currency quoted price difference 269,807 270,002 Other 774,679 201,801 6,382,135 6,913,670 B. FINANCIAL EXPENSE Interest on savings-account deposits 3,209 2,088 Interest on time deposits 1,805,767 2,781,242 Interest on interbank loans received (call options received) 29,731 15,664 Interest on other financing facilities from financial institutions 38,606 31,054 Interest on other liabilities from financial intermediation 24,393 57,076 Other interest 38,488 33,701 Adjustments under CER clause 11 19 Contribution to the deposit guarantee fund (Note 14) 44,763 87,772 Other 398,878 385,956 2,383,846 3,394,572 GROSS INTERMEDIATION MARGIN 3,998,289 3,519,098 C. CHARGE FOR LOAN LOSSES (Exhibit J) 246,317 158,863 D. REVENUE FROM SERVICES Related to lending transactions 540,084 407,838 Related to deposit transactions 921,183 608,719 Other fees 120,438 95,218 Other (Note 5) 478,735 374,548 2,060,440 1,486,323 7

STATEMENT OF INCOME For the six-month period ended 06/30/2017 and 06/30/2016 (amounts stated in thousands of pesos) BREAKDOWN - Continued 06/30/2017 06/30/2016 E. Service-charge expense Fees 174,104 110,848 Other (Note 5) 496,252 405,347 670,356 516,195 G. ADMINISTRATIVE EXPENSES Personnel expenses 1,740,509 1,437,540 Directors and supervisory auditors fees 51,040 37,342 Other professional fees 53,801 39,738 Advertising and marketing 100,158 57,209 Taxes 170,849 125,644 Depreciation of property, plant and equipment (Exhibit F) 44,837 26,266 Organization expenses amortization (Exhibit G) 15,538 6,916 Other operating expenses 414,870 309,891 Other 288,301 188,466 2,879,903 2,229,012 NET INCOME FROM FINANCIAL INTERMEDIATION 2,262,153 2,101,351 I. OTHER EARNINGS Income from long-term investments 344,064 196,317 Punitive interest 11,560 8,761 Receivables recovered and allowances reversed 29,531 89,483 Other (Note 5) 109,307 64,013 494,462 358,574 J. OTHER LOSSES Punitive interest and charges payable to the BCRA 61 18 Charge on uncollectibility of miscellaneous receivables, and other allowances (Exhibit J) 9,674 8,163 Losses and depreciation of miscellaneous assets (Exhibit F) 187 159 Other (Note 5) 121,560 26,673 131,482 35,013 NET INCOME BEFORE INCOME TAX 2,625,133 2,424,912 L. INCOME TAX (Note 1.6.s) 1,042,400 849,000 NET INCOME FOR THE PERIOD 1,582,733 1,575,912 The accompanying notes 1 to 25, exhibits A to L, N and O are an integral part of these financial statements. 8

STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY For the six-month period ended 06/30/2017 and 06/30/2016 Changes Capital stock (1) ( 3) Noncapitalized contributions Additional paid-in capital Appropriated retained earnings Legal Optional Unappropri ated retained earnings ( 2) Total as of 06/30/2017 Total as of 06/30/2016 Balances at beginning of year 719,145 217,191 1,887,990 3,141,814 3,269,112 9,235,252 7,681,521 Distribution of unappropriated retained earnings approved by the Annual Shareholders Meeting held on 04/26/2017 - Legal reserve - - 653,798 - ( 653,798) - - - Optional reserve Future distribution of earnings - - - 980,817 ( 980,817) - - - Cash dividends - - - - ( 1,634,497) ( 1,634,497) ( 52,728) Net income for the period - - - - 1,582,733 1,582,733 1,575,912 Balances at period-end 719,145 217,191 2,541,788 4,122,631 1,582,733 9,183,488 9,204,705 The accompanying notes 1 to 25, exhibits A to L, N and O are an integral part of these financial statements. (1) See Note 8.1. (2) See Note 17. (3) See Note 8.4. 9

STATEMENT OF CASH FLOWS AND CASH EQUIVALENTS For the six-month period ended 06/30/2017 and 06/30/2016 Changes in cash and cash equivalents (Note 2) 06/30/2017 06/30/2016 Cash at beginning of year 10,665,233 9,266,803 Cash at period-end 11,248,565 8,456,317 Net increase / (decrease) in cash 583,332 ( 810,486) Causes of changes in cash and cash equivalents Operating activities Net collections / (payments) of: Government and corporate securities 7,985,891 2,270,781 Loans 3,083,670 591,309 - To the financial sector 428,604 ( 222,599) - To the nonfinancial government sector 75,407 ( 194,671) - To the nonfinancial private sector and foreign residents 2,579,659 1,008,579 Other Receivables from Financial Intermediation ( 10,493,615) 1,727,828 Receivables from Finance Leases 134,139 93,263 Deposits 1,278,272 ( 2,857,007) - From the financial sector ( 15,541) ( 21,567) - From the nonfinancial government sector 1,205,210 1,686,804 - From the nonfinancial private sector and foreign residents 88,603 ( 4,522,244) Other Liabilities from Financial Intermediation 1,300,488 ( 772,243) - Financial sector or interbank loans (call options received) 445,172 35,097 - Other (except for the obligations included under financing activities) 855,316 ( 807,340) Collections related to revenues from services 2,055,895 1,477,949 Payments related to service-charge expenses ( 669,704) ( 516,487) Administrative expenses paid ( 3,300,295) ( 2,128,689) Payment of organization and development expenses ( 43,862) - Net collections of punitive interest 11,499 8,743 Collection of dividends from other companies 79,170 45,690 Other payments related to other earnings and expenses ( 434,110) ( 92,019) Net payments of other operating activities ( 295,529) ( 280,243) Income tax paid ( 613,789) ( 516,784) Net cash flows provided by/ (used in) operating activities 78,120 ( 947,909) 10

STATEMENT OF CASH FLOWS AND CASH EQUIVALENTS For the six-month period ended 06/30/2017 and 06/30/2016 Investing activities 06/30/2017 06/30/2016 Net payments of property, plant, and equipment ( 29,002) ( 120,562) Net collections/ (payments) of miscellaneous assets 5,870 ( 6,845) Payments for purchase /sale of interests in other companies ( 11,011) - Net cash flows used in investing activities ( 34,143) ( 127,407) Financing activities Net payments of: Unsubordinated corporate bonds ( 353,211) ( 42,471) BCRA - ( 5,000) Banks and international organizations ( 21,101) ( 14,636) Net cash flows used in financing activities ( 374,312) ( 62,107) Financial and holding gain-loss on cash and cash equivalents (including interest and monetary gain (loss) 913,667 326,937 Net increase / (decrease) in cash 583,332 ( 810,486) The accompanying notes 1 to 25, exhibits A to L, N and O are an integral part of these financial statements. 11

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED (Stated in thousands of pesos) NOTE 1: Basis for presentation of financial statements These financial statements have been prepared in conformity with the accounting standards established by the BCRA, and arise from the Bank s accounting records, which are kept in accordance with effective legal requirements and regulations. 1.1 Consolidated financial statements As required by BCRA rules, the Bank presents as supplementary information the consolidated financial statements with its subsidiaries GPAT Compañía Financiera S.A., Patagonia Valores S.A., Patagonia Inversora S.A. Sociedad Gerente de F.C.I. and Banco Patagonia (Uruguay) S.A. I.F.E. 1.2 Comparative information Under BCRA rules, the Statement of Financial Position as of June 30, 2017, and the related exhibits are presented comparatively with prior year-end data, while the Statements of Income, Changes in Shareholders' Equity and Cash Flows and cash equivalents for the sixmonth period ended June 30, 2017 are presented comparatively with those for the same period of the prior fiscal year. 1.3 Figures stated in thousands of Argentine pesos The amounts presented in these financial statements are stated in thousands of Argentine pesos as required by BCRA CONAU 1-111 (Communication A 3359). 1.4 Reporting currency The Bank s financial statements recognize the changes in the currency purchasing power through February 28, 2003, being discontinued from that date, as required by Presidential Decree No. 664/2003, CNV General Resolution No. 441 and BCRA Communication A 3921. However, the existence of significant variations as those noted in the most recent fiscal years in the prices of the relevant variables of the economy, such as the salary cost, the interest rates, and the exchange rates, which affect the Bank s business, may also impact the Bank s financial position, the results of operations and cash flows. Consequently, such variations should be considered in the interpretation of the information provided by the Bank in its financial statements about its financial position, results of operations and cash flows. 12

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED 1.5 Use of accounting estimates In preparing the financial statements, in certain cases, the Bank s Management is required to make estimates to determine the book value of assets and liabilities, as well as the exposure thereof, at each reporting date. The Bank s recorded amounts are based on the best estimate regarding the probability of occurrence of different future events and, therefore, the final amount may differ from such estimates, which may have a positive or negative impact on future periods. 1.6 Main valuation and disclosure criteria The main valuation and disclosure criteria applied to the preparation of the financial statements as of June 30, 2017, and comparative figures (see note 1.2) are the following: a) Assets and liabilities in foreign currency Assets and liabilities denominated in US dollars have been valued at the benchmark exchange rate set by the BCRA through BCRA Communication A 3500 for the US dollar at the close of the last trading day of each period or fiscal year, as applicable. In addition, assets and liabilities denominated in other foreign currencies, different from the US dollar, were converted at the exchange rates published by the BCRA at the end of each fiscal year or period, as applicable. Foreign exchange differences were recognized in profit or loss for each period. b) Government and corporate securities 1. Holdings carried at fair market value They were stated at quoted prices prevailing on the Buenos Aires securities and exchange market (MERVAL) or the Electronic Over-the-counter market (MAE), or at present values reported by the BCRA as of June 30, 2017 and December 31, 2016, plus the coupons pending collection. Quoted prices and present values differences were recognized in profit or loss for each period. 2. Holdings carried at cost plus yield As of June 30, 2017 and December 31, 2016, they were stated at acquisition cost, increased by the accrual of the internal rate of return, net of the offset account, as appropriate and, at the same time, compared with the present values calculated by the Bank. 13

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED 3. Instruments issued by the BCRA a) Holdings with volatility published by the BCRA (own portfolio and earmarked for repo transactions): they were valued in accordance with the last prevailing quoted price for each instrument as of June 30, 2017 and December 31, 2016. Quoted price differences were recognized in profit or loss for each period. b) Holdings without volatility published by the BCRA (own portfolio and earmarked for repo transactions): they were valued at acquisition cost increased based on the internal rate of return as of June 30, 2017 and December 31, 2016. The internal rate of return accruals mentioned above were recognized in profit or loss for each period. 4. Investments in listed corporate securities They were stated at quoted prices prevailing at the MERVAL as of June 30, 2017 and December 31, 2016. Quoted price differences were recognized in profit or loss for each period. c) Credit assistance to the nonfinancial government sector Mainly including amounts actually disbursed but not yet collected plus adjustments, quoted price differences and interest accrued receivable at each period or fiscal year, as applicable. d) Interest accrual Interest has been accrued on the basis of compounding, except for foreign trade transactions, savings account balances and overdraft balances, which have been accrued by applying the simple interest method. The Bank decided directly to interrupt the accrual of interest whenever loans are in default (generally, with delays over 90 days) and the recoverability of principal loaned and accrued interest is uncertain. Interest accrued until the interruption is deemed part of the outstanding balance upon determining the amount of the loan loss allowances. Subsequently, interest is only recognized based on collection, once the receivable for previously accrued interest has been settled. 14

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED e) Accrual of the adjustment by CER As of June 30, 2017 and December 31, 2016, some assets and liabilities have been adjusted by applying CER. f) Loans and deposits of government securities They were valued according to the effective quoted prices for each security at the end of each fiscal period or year, as applicable, plus the related accrued interest. Quoted price differences were recognized in profit or loss for each period. g) Allowance for loan losses, contingent commitments and other contingencies 1. Allowance for loan losses and contingent commitments The allowance for loan losses was set up based on the estimated uncollectibility risk of the Bank s credit facilities, which results from assessing the borrowers performance and the guarantees supporting the related transactions in conformity with BCRA Communication A 2950, as supplemented. 2. Allowance for other contingencies: It includes the amounts estimated by the Bank s Management necessary to bear likely contingencies, which, if verified, will result in a loss for the Bank. h) Other Receivables from Financial Intermediation 1. Amounts receivable from spot sales to be settled and forward sales They were valued at the prices agreed upon for each transaction, plus the related premiums accrued at the end of each fiscal period or year, as applicable. These premiums were recognized in profit or loss for each period. 2. Securities receivable from spot purchases to be settled and forward purchases a. Listed: they were valued at the quoted prices prevailing for each security at MERVAL or MAE at the end of each fiscal period or year, as applicable. Quoted price differences were recognized in profit or loss for each period. 15

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED b. Unlisted: they were valued at cost, increased by applying the internal rate of return at the end of each fiscal period or year, as applicable. The related accrual was recognized in profit or loss for each period. 3. Unlisted corporate bonds They were valued at cost adjusted by CER, where applicable, and increased by applying the internal rate of return. 4. Other not covered by Debtor Classification Standards Financial Trusts They were valued at adjusted cost, increased by applying the internal rate of return. i) Receivables from Finance Leases In accordance with BCRA Communication A 5047 as supplemented, they were valued at the discounted value of the addition of minimum installments pending collection (except for any contingent installments), the residual value previously agreed and the purchase options, for the finance lease agreements in which the Bank acts as a lessor. The discounted value is calculated by applying the imputed interest rate of each lease agreement. As of June 30, 2017 and December 31, 2016, the characteristics of the current lease agreements are those usually prevailing for this kind of transactions, and there is no differentiating issue of any kind compared with the transactions generally agreed on the Argentine financial market. These transactions are distributed among the Bank s customers and there are no preset contingent installments or automatic renewal clauses. j) Investments in other companies As of June 30, 2017 and December 31, 2016, the equity interests in other companies were valued as follows: 1. Subsidiaries Banco Patagonia (Uruguay) S.A. I.F.E.: at the amount calculated by the equity method at the end of each fiscal period or year, as applicable, converted into Argentine pesos, as described in note 1.6.a). 16

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED Patagonia Valores S.A., Patagonia Inversora S.A. Sociedad Gerente de Fondos Comunes de Inversión and GPAT Compañía Financiera S.A.: by the equity method at the end of each fiscal period or year, as applicable. 2. Other companies At cost, restated by applying the procedure described in note 1.4. or by the equity method, whichever lower, considering each company s latest available financial statements. k) Property, plant and equipment, and miscellaneous assets These assets were recorded at cost, restated following the procedure described in note 1.4. Depreciation was calculated based on the months of useful life. The assets were fully depreciated in the month of addition, but were not depreciated in the month of disposal. The residual value of property, plant and equipment, taken as a whole, does not exceed the recoverable value of such assets. l) Other miscellaneous assets These assets were recorded at cost, restated following the procedure described in note 1.4. Depreciation, when appropriate, was calculated based on the months of useful life. The assets were fully depreciated in the month of addition, but were not depreciated in the month of disposal. The residual value of these assets, taken as a whole, does not exceed their recoverable value. m) Intangible assets 1. Differences from court deposits dollarization - deductible for the determination of computable equity Original value As required by BCRA Communication A 4686, dated July 4, 2007, this includes the difference between the equivalent value in pesos, considering the court deposits in the currency in which they were made, and the book value of such deposits made in foreign currency which, as of January 5, 2002, fell within the scope of Law 25561 and Presidential Decree No. 214/02. 17

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED As of June 30, 2017 and December 31, 2016, the amount recorded is 1,726, and according to the criterion adopted by the Bank, it was fully amortized and recognized in profit or loss. 2. Organization and development expenses Leasehold improvement as well as system expenses incurred by the Bank, involving planning, surveys, organization projects and the development of applications by third parties and the subsequent implementation thereof were recorded. These expenses were recorded at cost, restated following the procedure described in note 1.4., less the related accumulated amortization. Expense amortization is calculated based on the useful life stated in months, which shall not exceed 60 monthly installments as from each capitalization, subject to a full month of addition amortization, whereas the disposal month is not amortized. As of June 30, 2017 and December 31, 2016, the residual value of Organization and development expenses amounts to 98,233 and 69,909, respectively. n) Other Liabilities from Financial Intermediation 1. Unsubordinated corporate bonds As of December 31, 2016, they were stated at nominal value plus accrued interest at such year-end. (See Note 9). 2. Amounts payable for spot purchases to be settled and forward purchases They were valued at the prices agreed upon for each transaction, plus the related premiums accrued at the end of each fiscal period or year, as applicable. These premiums were recognized in profit or loss for each period. 3. Securities to be delivered under spot sales to be settled and forward sales a. Listed: they were valued at the quoted prices of each security prevailing at MERVAL or MAE at the end of each fiscal period or year, as applicable. Quoted price differences were recognized in profit or loss for each period. 18

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED b. Unlisted: they were valued at cost, increased by applying the internal rate of return at the end of each fiscal period or year, as applicable. The related accrual was recognized in profit or loss for each period. o) Items pending allocation It includes items that, due to administrative organization reasons or the special nature of the relationship with third parties, were not directly allocated to the related accounts. p) Equity accounts Capital stock remained at its original value. q) Memorandum accounts - Derivatives 1. Forward transactions without delivery of underlying asset: they were valued according to the effective price quoted on the MAE or Rosario s Security Market (ROFEX), depending on the scope of the agreement at the end of each fiscal period or year. Quoted price differences were recognized in profit or loss for each period. 2. Interest rate swap transactions: they were valued at the notional value on which the Bank agrees to pay or charge a fixed interest rate and a floating interest rate. The difference between such rates was charged to profit or loss for each period. r) Statement of income The accounts comprising monetary transactions occurred in each period (financial income (expenses), revenues from services, service-charge (expenses), uncollectibility charge, administrative expenses, etc.) were recorded at their historical amounts on a monthly accrual basis. The accounts reflecting the effect on income (loss) of the sale, disposal, or consumption of nonmonetary assets were computed based on the values of those assets. Income (loss) from interests in subsidiaries was computed based on the income (loss) of those companies. 19

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED s) Income taxes and minimum presumed income tax The Bank calculates income tax by applying the effective 35% rate to taxable income for each fiscal year, without considering the effect of temporary differences between income for accounting and tax purposes. It also assesses minimum presumed income tax, which was established by Law No. 25063 for a ten-year term for fiscal years ended on or after December 31, 1998. At present, after successive extensions, such tax is effective through December 31, 2019. On July 21, 2016, through the provisions of Law 27760, this tax was repealed for the fiscal years beginning on or after January 1, 2019. This tax is supplementary to the income tax because, whereas the latter is levied on taxable income for the year, minimum presumed income tax is a minimum levy on the potential income of certain productive assets at a 1% rate. Therefore, the Bank s tax liability will be represented by the highest of both taxes. In the case of institutions governed by the Financial Institutions Law, the abovementioned law sets forth that they shall consider as taxable income 20% of their taxable assets, after deducting those assets defined as non-computable. However, should minimum presumed income tax exceed income tax in a given fiscal year, such excess may be computed as a credit towards future income taxes occurring in any of the next ten fiscal years, once the accumulated tax loss have been used. As of June 30, 2017 and 2016, the Bank assessed the income tax expense based on taxable income of 1,042,400 and 849,000, respectively, which were recorded under Miscellaneous liabilities and recognized in profit or loss for each period under Income tax. Those amounts exceeded minimum presumed income tax amounts for each period; therefore, no provision was recorded in this regard. t) Severance pay The Bank directly expenses severance payments. 20

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED NOTE 2: Statement of cash flows and cash equivalents The statements of cash flows and cash equivalents as of June 30, 2017 and 2016 explain the changes in cash and cash equivalents and for such purpose, only the total amount included under Cash and due from banks was considered cash. Additionally, there are no transactions related to investment or financing activities which have an impact on cash and which should be disclosed as a result of their significance. NOTE 3: Main differences between BCRA standards and professional accounting standards effective in the City of Buenos Aires The professional accounting standards effective in the City of Buenos Aires, Argentina, differ in certain valuation and disclosure criteria from BCRA accounting standards. The main differences between such criteria identified by the Bank and considered material to these financial statements are further described below: 3.1. Valuation criteria The Bank s main differences in valuation criteria as of June 30, 2017 and December 31, 2016, are as follows: Adjustments to stand-alone financial statements (as per professional accounting standards) Item a) Government and corporate securities carried at cost plus yield Equity Income/loss Increase/(Decrease) Income/(Loss) 06/30/2017 12/31/2016 06/30/2017 06/30/2016 ( 6,055) 6,718 ( 12,773) 35,828 b) Acquisition of GPAT Compañía Financiera S.A. 1,337 1,205 132 132 c) Deferred income tax (assets) 581,161 365,017 216,144 54,345 d) Derivative financial instruments ( 11,199) - ( 11,199) - e) Investments in other companies 49,376 30,803 18,573 2,660 TOTAL 614,620 403,743 210,877 92,965 21

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED Adjustments to the consolidated financial statements (as per professional accounting standards) Item a) Government and corporate securities carried at cost plus yield Equity Income/loss Increase/(Decrease) Income/(Loss) 06/30/2017 12/31/2016 06/30/2017 06/30/2016 ( 6,055) 6,718 ( 12,773) 35,855 b) Acquisition of GPAT Compañía Financiera S.A. 1,337 1,205 132 132 c) Deferred income tax (assets) 619,338 395,820 223,518 56,978 TOTAL 614,620 403,743 210,877 92,965 a) Government and corporate securities carried at cost plus yield As of June 30, 2017 and December 31, 2016, the Bank recorded under Government and corporate securities Instruments issued by the BCRA holdings valued pursuant to note 1.6.b) 2 and 1.6.b) 3.b), respectively. Following that criterion, it recorded BCRA bills and notes under Other receivables from financial intermediation BCRA. According to professional accounting standards, these assets should be stated at current values. b) Business combinations- Acquisition of GPAT Compañía Financiera S.A. Under the standards set forth by the BCRA, business acquisitions are recorded at the book value of the acquired company. Consequently, the difference between the cost of investment and its equity value in the books of the acquirer is recorded as a positive goodwill (when the cost of investment is higher than the equity value) or a negative goodwill (when the cost of investment is lower than the equity value), as applicable. If goodwill is negative, BCRA Communication A 3984 establishes specific amortization methods; the maximum annual amortization allowed is 20%. According to professional accounting standards, business combinations are recorded based on the current values of the acquired company s identifiable net assets. Consequently, the difference between the cost of investment and the identifiable net asset measurement value is recorded as a positive or negative goodwill, as applicable. If goodwill is negative, such goodwill will be recognized in income/loss in accordance with the changes in the specific circumstances that brought about such negative goodwill. 22

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED c) Deferred income tax The Bank assesses income tax by applying the effective rate to the estimated taxable income for each fiscal year, disregarding the effect of temporary differences between income for accounting purposes and income for tax purposes. In accordance with professional accounting standards, the income tax should be recorded by applying the deferred tax method, which consists in recognizing (as a receivable or payable) the tax effect of temporary differences between the valuation of assets and liabilities for accounting and tax purposes, and, subsequently, recognizing them in income/loss for the fiscal years in which such differences are reversed, having duly considered the likelihood of using such tax losses in the future, if applicable. d) Derivative financial instruments As of June 30, 2017, the Bank booked the effects of interest rate swap agreements as mentioned in note 1.6.q) 2. Under professional accounting standards, derivative financial instruments should be measured at their net realizable value, which, in this case, may be estimated by using mathematical models that reflect the way in which the parties to these agreements set prices and include reliable data. Thus, the fair value applicable to swap rights or obligations can be estimated. e) Investments in other companies The subsidiary GPAT Compañía Financiera S.A. prepares its financial statements pursuant to BCRA rules, which differ from the professional accounting standards. Had professional accounting standards been applied, the Bank s shareholders equity would have increased by 614,620 and 403,743, respectively, at the stand-alone and consolidated levels, as of June 30, 2017 and December 31, 2016. In addition, income/loss for the six-month periods ended June 30, 2017 and 2016 would have increased by 210,877 and 92,965, respectively, at the standalone and consolidated levels. 3.2 Disclosure criteria a) The Bank does not disclose segment information or earnings per share. b) The Bank does not classify its assets and liabilities as current and noncurrent based on the point in time at which the assets are expected to be turned into cash or cash equivalents and based on the point in time at which the liabilities become payable, as required by current professional accounting standards. 23

NOTES TO FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 COMPARATIVELY PRESENTED c) There are differences between the disclosure required by professional accounting standards and that conducted by the Bank regarding the cash flows disclosed in the statements of cash flows, as these financial statements are prepared in conformity with specific standards applicable to financial institutions. d) As supplementary information (exhibits), the Bank presents the information specifically required by the BCRA, which does not consider all disclosure requirements of professional accounting standards. NOTE 4: Reconciliation of balances within the accounting framework for the adoption of the International Financial Reporting Standards (IFRS) Process for IFRS convergence Process for IFRS convergence According to the provisions of BCRA Communication A 5541, the Bank is in the process of adopting the IFRS issued by the International Accounting Standards Board (IASB). IFRS will be effective for annual accounting periods beginning on or after January 1, 2018 and for the interim accounting periods of such annual periods. Therefore, as from the first quarterly period of fiscal year 2018, financial institutions shall prepare and present their financial statements for publication in accordance with IFRS. Such financial statements will include the opinion of the external auditor, and will be used by financial institutions for all legal and corporate purposes. Accordingly, at a meeting held on March 30, 2015, the Bank s Board of Directors approved the Implementation Plan for Convergence to IFRS, which was filed with the BCRA on March 31, 2015. To the date of issuance of these financial statements, the Bank is carrying out the Implementation Plan, the development of which is subject to the specific rules issued by the BCRA. It is worth mentioning that, currently, the Bank is developing the changes to its systems in order to meet the criteria for the adoption of IFRS as defined by the BCRA. Therefore, the items and amounts contained in the reconciliation included in this note are subject to change, and can only be considered final when the annual consolidated financial statements for fiscal 2018 are prepared under IFRS. 24