Disclaimer The information in this presentation has been prepared under the scope of the International Financial Reporting Standards ( IFRS ) of BCP Group for the purposes of the preparation of the consolidated financial statements under Regulation (CE) 1606/2002 The figures presented do not constitute any form of commitment by BCP in regard to future earnings Figures for 2016 not audited The business figures presented exclude the former Banco Millennium Angola 2
Agenda Highlights Group Profitability Liquidity Capital Portugal International operations Conclusions 3
Summary 1 Profits in 2016 ( 23.9 million), in spite of a significant increase of impairment charges to 1.6 billion. Strong profit performance excluding non-usual items Strong, consistent growth of the consolidated operating net income before provisions, in excess of 1 billion 2 Significantly lower NPEs and NPLs in Portugal, together with increased coverage, both by loan-loss reserves, to 39% from 31%, and total, including guarantees, to 100% from 93% 3 Capital strengthened in early February, allowing for the full repayment of CoCos and bringing the fully implemented CET1 ratio to >11% 4
Highlights: profitability Operating net income before impairment and non-usual items* 590.9 776.7 895.7 Net income before non-usual items* 1,024.8 2013 2014 Operating net income before impairment and non-usual items increases to 1,024.8 million in 2016 from 590.9 million in 2013 In spite of significant impairment charges ( 1,598 million), a 97.6 million profit was returned in 2016 excluding nonusual items, showing a strong performance from a 22.2 million loss in 2015, and a substantial continuous improvement over the last 4 years -22.2 97.6 Stated net profit of 23.9 million in 2016 ( 235.3 million in 2015) -282.8-650.5 2013 2014 *Non-usual items in 2016: gains on Visa transaction, capital gains on Portuguese sovereign debt, impact from revision of collective labour agreement net of restructuring costs, devaluation of corporate restructuring funds and of goodwill, additional impairment charges to increase coverage and fiscal impact; in 2015: capital gains on Portuguese sovereign debt, restructuring costs, and devaluation of corporate restructuring funds; in 2014: capital gains on Portuguese sovereign debt, capital gain on the sale of an insurance subsidiary and AQR provisions; in 2013: costs with mutually-agreed terminations and with early retirements. 5
Highlights: asset quality Non-performing exposures (NPEs) 86% 90% 12,783 10,921 Net new entries in NPL>90 days 93% 100% Coverage* 9,777 8,542 6,213 6,134 5,572 5,029 Dec 13 Dec 14 Dec 15 Dec 16 636.1 541.1 Other NPEs NPL>90d NPEs in Portugal down to 8.5 billion as at December 31, 2016, showing a strong pace of reduction from 2013: 1.4 billion per year, on average NPE total coverage* up to 100%, with coverage by loan-loss reserves up to 39% (23% as at year-end 2013), thus supporting the < 7.5 billion NPE target for December 2017 NPL>90 days down to 5.0 billion as at December 31, 2016, with net new entries showing a significant reduction to 139 million 264.9 138.8 Coverage by provisions of NPL>90 days strengthened to 69% as of year-end 2016 (51% as at the end of 2013) 2013 2014 *By loan-loss reserves, expected loss gap and collaterals. 6
Highlights: capital Phased-in capital ratio (CET1 CRD IV / CRR)* Fully implemented 10.2% 9.6% 11.1% 13.3% 12.4% 12.8% Dez 15 Dez 16 1 Jan 17 adj. to cap. increase, CoCo rep.** Shareholding structure following cap. increase Non-PT Institutionals 21% Non-PT Retail 2% PT Institut. 7% PT Retail 29% Fosun 24% EDP 2% Sonangol 15% 1.3 billion share capital increase completed in February 7, 2017. Demand exceeded supply by 23% Repayment of CoCos and end to State support, the latter having translated into a total cost, including extraordinary contribution by the banking sector, in excess of 1 billion from January 2009 to February 2017 CET1 ratios reinforced to 11.1% on a fully implemented basis and to 12.8% under phased-in principles** Shareholding structure following share capital increase with a significant presence of Portuguese investors (38%) and strong free-float (61%) Only bank with equities listed in the PSI-20 index *Estimates. **Estimates as at January 31, 2017, adjusted by the impact of the capital increase and of CoCo repayment, both completed in February 2017. 7
Highlights: business in Portugal Individuals Customer acquisition Packages More than 1 million Customers with day-to-day management solutions Companies 180,000 new Customers Customer evaluation Customers Elected best for Companies, closest to Customers and most innovating bank by DATA E Acquisition and re-activation of 13,500 Customers Treasury bonds Placement of + 700 million variable income Treasury bonds POSs Installed POSs up by 12% Loans to individuals New mortgages and consumer loans up from 1.2 billion to 1.5 billion (+28%) Factoring Factoring invoicing up by 35%, average credit balance up by 50% from 2015 Online brokerage Leading banking group in online brokerage with a 23.7% market share Support to exports Millennium Exportação conference and Portugal Global roadshow Digital banking More than 680,000 active users Agrobusiness Partnership with Agroges, designed to support investment related to Rural Development Program 2020 8
Agenda Highlights Group Profitability Liquidity Capital Portugal International operations Conclusions 9
Profit of 23.9 million in 2016, with a significant improvement of earnings excluding non-usual items (million euros) Impact on earnings Core net income (net int income+commissions oper. costs) 839.4 908.2 +68.9 Other operating income 56.3 116.5 +60.2 Operating net income (bef. impairment and provisions) 895.7 1,024.8 +129.1 Impairment and provisions -952.6-826.9 +125.7 Net income before income tax -56.9 197.8 +254.8 Income taxes, non-controlling interests and disc. operations 34.8-100.2-135.0 Net income excluding non-usual items -22.2 97.6 +119.8 Non-usual items, net of taxes 257.5-73.7-331.2 Net income 235.3 23.9-211.4 10
Non-usual items (million euros) Impact on earnings Gains on Visa transaction 0.0 96.2 +96.2 Capital gains on Portuguese sovereign debt 396.3 10.0-386.3 Impact from revision of collective agreement, net of rest. costs -5.8 185.7 +191.6 Fiscal impact 0.0 281.2 +281.2 Additional impairment charges (to increase coverage)* 0.0-495.8-495.8 Devaluation of corporate restructuring funds -25.2-224.2-199.0 Devaluation of goodwill 0.0-51.0-51.0 Non-usual items, gross 365.2-198.0-563.2 Non-usual items, net of taxes and non-controling interests 257.5-73.7-331.2 * Impairment charges in excess of 120bp consolidated cost of risk, to reinforce NPE coverage. 11
Profit of 23.9 million in 2016, with a significant improvement of earnings excluding non-usual items -211.4 235.3-349.5 Total impact: -331.2 +119.8 23.9-271.5 +281.2-140.3 +150.8-51.0 +49.2 Net Income 2015 Impact of additional impairment to increase coverage Impact of lower gains on Portuguese sovereign debt Impact of devaluation of corporate restructuring funds Impact of goodwill devaluation Impact of Visa transaction Impact rev. collective lab. agreem. net of restructuring costs Fiscal impact Improvement to earnings excluding non-usual items Net Income 2016 12
as well as core net income, reflecting strong performance in Portugal Core net income*, consolidated Portugal +31.2% 1,094.0 515.5 +46.3% 754.5 833.6 Impact rev. collective labour agreement, net of restructuring costs International operations -5.8 185.7 +22.0% w/o FX impact +6.8% 318.0 339.5 Impact rev. collective labour agreement, net of restructuring costs -5.8 185.7 * Core net income = net interest income + net fees and commission income operating costs. 13
Net interest income increase driven by the continuation of reduction of cost of deposits Net interest income, consolidated Net interest margin 1.8% 1.9% Excluding CoCos 1.9% 2.0% +3.3% 1,230.1 1,190.6 Portugal Net interest margin 1.5% 1.6% +3.5% 736.1 711.3 International operations Net interest margin +19.8% w/o FX impact 2.5% 2.7% +3.1% 479.3 494.0 14
whereas FX devaluation led to lower commissions Fees and commissions, consolidated Portugal +1.9% YoY 448.2 456.6 Banking fees and commissions 529.9 521.0-1.7% Cards and transfers 158.8 144.4-9.1% Loans and guarantees 160.4 160.3-0.0% Bancassurance 75.3 76.7 +1.8% Customer account related 84.4 90.6 +7.3% Other fees and commissions 51.0 49.0-3.9% Market related fees and commissions 130.4 122.8-5.8% Securities operations 91.3 84.6-7.3% International operations 212.1-11.7% -0.6% w/o FX impact 187.2 Asset management 39.1 38.3-2.2% Total fees and commissions 660.3 643.8-2.5% 15
Performance of other income influenced by gains on PT sovereign debt in 2015 Other income, consolidated Portugal 392.1-66.0% 452.7-50.8% 133.5 Visa transaction 0.0 26.4 222.7 Gains on PT sov. debt 396.3 10.0 International operations 60.5 +47.5% 89.3 Visa transaction 0.0 96.2 Gains on PT sov. debt 396.3 10.0 Visa transaction 0.0 69.8 16
Cost reduction continues... Operating costs, consolidated Portugal Cost to core income* Depreciation Cost to core income* 55.5% 52.3% 54.6% 51.5% -2.2% -4.5% 638.2 624.0 1,011.5 965.7 54.1-7.9% 49.8 Other administrative costs 389.3-4.0% 373.6 Impact rev. labour agreem., net of restructuring costs International operations 5.8-185.7 Staff costs 568.1-4.5% 542.3 Cost to core income 54.0% 50.2% +5.9% w/o FX impact -8.5% 373.3 341.7 Impact rev. labour agreem., net of restructuring costs 5.8-185.7 *Core income = net interest income + net fees and commission income. Excluding non-usual items. Cost to core income including non-usual items: 55.0% in 2015 and 41.6% in 2016, in consolidated terms, and 55.5% in 2015 e 36.7% in 2016, in Portugal. 17
... making Millennium bcp one of the most efficient banks in the Eurozone Cost to core income* Cost to core income* Latest available data vs. peers in Portugal vs. Euro-zone banks 85.7% -34pp 52% 52% 64.0% 54.6% 51.5% Bank 1 77% 65% 2013 2014 Bank 2 67% 77% Cost to core income* Bank 3 77% 115% 85.7% 84.1% 80.0% Bank 4 56% 97% 51.5% 63% 84% 2013 2014 *Core income = net interest income + net fees and commission income. Excluding non-usual items. Cost to core income including non-usual items: 55.0% in 2015 and 41.6% in 2016. 18
We have reinforced the balance sheet with a significant amount of additional impairment and provision charges... Impairment and provisions, consolidated Portugal +63.4% 1,598.0 481.1 Other 883 152.7 +71.8% 1,516 470.6 Other 977.9 160.1 Loans Cost of risk 729.8 175bp 1,045.2 266bp Loans Cost of risk Additional impairment Devaluation of corporate restr funds Goodwill devaluation 1,116.9 817.8 216bp 150bp 0.0 495.8 25.2 224.2 0.0 51.0 International operations Other impairment and provisions Loan impairment, net of recoveries Cost of risk 95.4 7.4 88.0 69bp -13.9% +0.5% w/o FX impact 82.1 10.4 71.7 58bp 19
with lower delinquency and increased coverage Credit quality, consolidated Portugal Total coverage NPEs* NPEs Other 91.1% 99.1% -11.4% 10,581 9,379 4,609 3,994 Total cov. NPEs* NPEs Loan-loss reserves -12.6% Operações internacionais 92.6% 100.2% 9,777 8,542 Dec 15 Dec 16 2,991 3,346 Total cov. NPEs* 72.9% 87.9% NPL>90d 5,971 5,385 NPEs +4.1% 803 836 Total coverage NPL>90d* 161.5% 172.6% Loan-loss reserves Dec 15 Dec 16 3,420 3,741 Loan-loss reserves Dec 15 Dec 16 429 395 *By loan-loss reserves, expected loss gap and collaterals. 20
Agenda Highlights Group Profitability Liquidity Capital Portugal International operations Conclusions 21
Deposits influenced by FX impact in international operations; stable individuals and companies deposits in Portugal Customer Funds, consolidated Customer deposits in Portugal Off-BS -1.7% 64,485 63,377 12,327 funds 12,943 33,049 32,652 Other BS funds Term deposits 2,311 1,636 30,188 26,781 Other (inc public sector) Companies and Individuals -2.3% 34,816 34,023 1,767 1,371 Dec 15 Dec 16 Customer deposits in international op. +5.1% w/o FX impact -1.7% 15,031 14,775 0.9% increase including the placement of 709 million in OTRV Ondemand deposits 19,659 22,017 Dec 15 Dec 16 Dec 15 Dec 16 22
Credit portfolio reflects support to economy in key business sectors, in spite of continuing deleveraging and NPE reduction Loans to Customers (gross), consolidated Mortgage -4.9% 54,443 51,758 25,040 24,018 Portugal Mortgage Consumer / other Companies -5.4% 41,595 39,361 18,465 17,698 2,423 2,435 20,708 19,227 Reduction of exposure to construction/real estate activities (-17%); Strong performance of mining and manufacturing (+3% vs banking system 0.3%) and commerce (+4% vs 1% banking system) Dec 15 Dec 16 Consumer and other Companies 4,045 25,358 4,058 23,682 International operations +3.0% sem efeito cambial -3.5% 12,848 12,398 Dec15 Dec 16 Dec 15 Dec 16 23
Growing new loans to individuals, new leasing business and factoring invoicing Loans to individuals, new business Leasing, new business +28.4% 1,540.4 318.7 +24.5% 396.8 1,200.2 Factoring invoicing 3,631 2,061 +35.2% +32.9% 4,909 2,740 1,570 +38.2% 2,169 Confirming Factoring 24
Comfortable liquidity position Net loans to deposits ratio ECB funding Net loans as a % of BS Customer funds 98% 95% -4pp 102% 98% (Billion euros) Elegible assets TLTRO Other 13.9 5.3 1.5 3.8 12.1 4.4 4.0 0.4 Dec 15 Dec 16 Liquidity ratios (CRD IV/CRR) 112% 124% Regulatory requirement 100% 80% Dec 15 Dec 16 NSFR (Net stable funding ratio) LCR (Liquidity coverage ratio) 25
Agenda Highlights Group Profitability Liquidity Capital Portugal International operations Conclusions 26
Strengthened capital, in line with European peers Common Equity Tier 1 ratio Phased-in, latest available data Common Equity Tier 1 ratio* vs. Euro-zone banks 13.3% 12.8% 12.8% * 10.2% 11.1% 12.0% 12.6% 10.5% Dez 15 1 Jan 17 incl cap. increase, CoCo repaym. Dez 15 1 Jan 17 incl cap. increase, CoCo repaym. Phased-in Fully implemented 11.7% RWAs ( Bln) 43.3 39.3* 42.7 38.8* *Estimates as at January 1, 2017, adjusted by the impact of the capital increase and of CoCo repayment, both completed in February 2017. 27
Capital reinforced, high RWA density From equity to CET1 capital* (Million euros, December 2016) Phased-in: 12.8% RWA density RWAs as % of assets, latest available information 5,690 Deductions +44 11.1% 4,315 CET1 ratio fully imp. 45% 45% 55% -1,125-123 -172 26% 26% Equity DTAs EL gap Stakes >10% Other CET1 fully imp. FR DE ES IT Minimum phased-in capital requirements (SREP) Pillar 1 Conservation buffer Countercyclical buffer Other syst. important institutions buffer Pillar 2 requirements (P2R) Total require -ments 1 Jan 17 Phased-in CET1 4.50% 1.25% 0.00% 0.00% 2.40% 8.15% 12.8% Total capital 8.00% 1.25% 0.00% 0.00% 2.40% 11.65% 14.0% *Estimates as at January 1, 2017, adjusted by the impact of the capital increase and of CoCo repayment, both completed in February 2017. 28
Capital at comfortable levels, high leverage ratios Leverage ratio Leverage ratio Phased-in, latest available information 7.3% 7.4% 4.0% 5.0% 5.8% 5.6% 7.4% 5.6% 6.0% FR DE ES IT Texas ratio* 139.6% 101.3% Dec 15 Dec 16 Dec 15 Dec 16 Phased-in Fully implemented Dec 15 Dec 16 *Texas ratio = NPE / (Tangible equity + stock of impairments). 29
Pension fund Key figures Pension fund Dec 15 Dec 16 Loans to banks, other 31% Equities 17% Assumptions Pension liabilities 3,136 3,093 Pension fund 3,158 3,124 Liabilities' coverage 111% 112% Fund's profitability -0.8% -2.6% Actuarial differences (111) (303) Property 9% Bonds 43% Discount rate Salary growth rate Dec 15 2.50% 0.75% until 2017 1.00% after 2017 Dec 16 2.10% 0.25% until 2019 0.75% after 2019 Change of assumptions: discount rate down to 2.1%, similar to the expected rate of return of the fund; review to wage and pensions growth rates; revision to men s mortality table Pensions growth rate Projected rate of return of fund assets Mortality Tables Men Women 0.00% until 2017 0.50% after 2017 2.50% Tv 73/77-2 years Tv 88/90-3 years 0.00% until 2019 0.50% after 2019 2.10% Tv 88/90 Tv 88/90-3 years Pension liabilities coverage at 112% Negative actuarial differences in 2016 (- 303 million), mainly reflecting a lower discount rate and the fund s underperformance vs assumptions, partially offset by the favourable impact of the revision of wage and pensions growth rates 30
Agenda Highlights Group Profitability Liquidity Capital Portugal International operations Conclusions 31
Portugal: deleveraging improves liquidity position Customer funds Loans to Customers (gross) -1.7% 47,965 47,168 Off-BS funds 10,909 11,601 41,595-5.4% 39,361 Other BS funds 2,241 1,545 Mortgage 18,465 17,698 Term deposits 21,936 19,938 Consumer and other 2,423 2,435 Companies 20,708 19,227 On-demand deposits 12,880 14,084 Dec 15 Dec 16 Dec 15 Dec 16 32
Significant improvement of earnings excluding non-usual items Net income excluding non-usual items Net income of - 157,3 million in 2016. Non-usual items -55.3-213.3 +158.0 Net income 44.2-157.3 Net income excluding non-usual items -213.3-55.3 Gains on Visa transaction 0.0 20.8 Gains on Portuguese sovereign debt 279.4 7.9 Impact from rev. labour agr. (net of rest. costs) -4.1 146.7 Fiscal impact 0.0 281.2 Add. impairment charges (to increase coverage)* 0.0-349.5 Devaluation of corporate restructuring funds -17.8-158.1 Devaluation of goodwill 0.0-51.0 Total non-usual items, net 257.5-102.0 Net income 44.2-157.3 Net income amounted to - 55.3 million in 2016 without non-usual items, a 158.0 million improvement from - 213.3 million in 2015. Non-usual items in 2016: gains on Visa transaction, capital gains on Portuguese sovereign debt, impact from revision of collective labour agreement net of restructuring costs, devaluation of corporate restructuring funds and of goodwill, additional impairment charges to increase coverage and fiscal impact; non-usual items in 2015: capital gains on Portuguese sovereign debt, restructuring costs, and devaluation of corporate restructuring funds. * Impairment charges in excess of 120bp consolidated cost of risk, to reinforce NPE coverage. 33
Improvement trend on core income and operating costs continues in Portugal Core net income* 515.5 754.5 568.7 excluding non-usual items Core Income +2.9% 1,159.5 1,192.7 448.2 456.6 Commissions 711.3 736.1 Net interest income Operating costs 644.0 438.3 624.0 excluding non-usual items Core income increases to 1.2 billion in 2016 Operating costs down to 438 million in the same period Continuation of the core net income* expansion trend, to 754 million in 2016 * Core net income = net interest income + net fees and commission income operating costs. 34
Lower cost of deposits and NPLs more than compensate for the decreases of credit volumes and Euribor Net interest income NIM +3.5% 711.3 736.1 1.5% 1.6% Breakdown of net interest income Commercial margin 4Q16 vs. 3Q16 2016 vs. 2015 Loans volume effect -3.6-65.7 Effect of lower Euribor on credit -1.3-95.8 Effect of cost of time deposits +4.2 +152.5 Funding and other +0.3 +49.1 Total commercial margin -0.5 +40.1 Securities +0.7-30.2 NPL effect +8.1 +11.6 Other -0.0 +3.3 Total +8.3 +24.8 Increase in net interest income compared to 2015, reflecting the impact of the consistent reduction of the cost of term deposits and the reduction of NPLs, more than compensating for the negative effect of the reduction of Euribor rates and of lower credit volumes, as well as of the lower contribution from the securities portfolio Increased net interest income vs the previous quarter, mainly attributable to lower NPL volumes and to the continuing reduction of the cost of term deposits, more than compensating for a lower credit volume and for the negative effect of the reduction of Euribor rates CoCo repayment will have a 65 million positive impact on net interest income 35
Continued effort to reduce the cost of deposits Spread on the book of term deposits (vs 3m Euribor) Spread on the performing loan book (vs 3m Euribor) 3.0% 2.9% -0.8% -1.2% NIM 1.5% 1.6% Continued improvement of the spread of the portfolio of term deposits: from -1.2% in 2015 to -0.8% in 2016; December s front book, priced at an average spread of -64bp, is still below current back book s Spread on the performing loan book at 2.9% in 2016 (3.0% in 2015) NIM stood at 1.6% (1.5% in 2015) 36
Increased commissions YoY Banking fees and commissions 389.8 397.0 +1.8% Cards and transfers 99.5 100.2 +0.8% Loans and guarantees 118.3 107.6-9.0% Bancassurance 75.3 76.7 +1.8% Customer account related 84.2 90.5 +7.4% Other fees and commissions 12.5 22.0 +76.5% Market related fees and commissions 58.4 59.6 +2.0% Securities operations 52.1 53.5 +2.7% Asset management 6.2 6.1-3.1% Total fees and commissions 448.2 456.6 +1.9% 37
Continuous reduction of costs, in line with the new commercial approach Operating costs Employees Cost to core income* 55.5% 52.3% -126 644.0 7,459 7,333 Depreciation 30.3 624.0 excluding non-usual items Other administrative costs 236.8 438.3 29.4 Branches Dec 15 Dec 16 232.7-53 Staff costs 376.9 671 618 176.1 Dec 15 Dec 16 * Core income = net interest income + net fees and commission income. Excluding non-usual items. Cost to core income including non-usual items: 55.5% in 2015 and 36.7% in 2016. 38
Reinforced coverage of NPL>90d NPL>90d Credit ratio Dec 15 Dec 16 NPL>90d 13.4% 12.8% Loan loss reserves Coverage ratio Dec 15 Dec 16 NPL>90d 53.7% 66.5% 5,572 5,029 2,991 3,346 Dec 15 Dec 16 Dec 15 Dec 16 NPL>90d build-up Loan impairment (net of recoveries) 2016 vs. 2015 Dec 16 vs.sep 16 Opening balance 5,572 5,454 +/- Net entries 138.8-146.0 - Write-offs -425.4-126.1 - Sales -256.7-152.8 175bp 729.8 266bp 1,045.2 Ending balance 5,029 5,029 39
Lower NPEs with reinforced coverage Non-performing exposures (NPEs) 93% -9.8% 100% Coverage* 9,777 8,542 5,572 5,029 Dec 15 Dec 16 Other NPEs NPL>90d NPE coverage 101% 99% 100% 36% 69% 46% 19% 15% 8% 24% 44% 39% Individuals Companies Total Real estate collateral Cash, other fin. collat., EL gap LLRs NPL>90d coverage Other NPE coverage 98% 100% 100% 107% 97% 100% 64% 32% 43% 14% 11% 4% 30% 54% 46% Individuals Companies Total Real estate collateral Cash, other fin. collat., EL gap LLRs 78% 41% 49% 23% 22% 17% 12% 33% 28% Individuals Companies Total Real estate collateral Cash, other fin. collat., EL gap LLRs *By loan-loss reserves, expected loss gap and collaterals. 40
Foreclosed assets sold above book value Foreclosed assets Number of properties sold 1,782 +7.4% 2,390 2,566 1,446 201 Impairment 234 Book value of sold properties Net value 1,212 1,582 Sale value 257 272 +7.2% 231 248 Dec 15 Dec 16 41
Agenda Highlights Group Profitability Liquidity Capital Portugal International operations Conclusions 42
Contribution from international operations Contribution from international operations increases on a comparable basis International operations Δ % local currency Δ % euros Poland 124.9 160.3 +28.3% +22.6% 10.4% Mozambique 53.0 71.2 +34.3% -15.4% 23.1% Angola* 27.8 31.7 +14.3% -16.3% Other 10.8 13.3 +23.2% +21.4% Net income 216.5 276.5 +27.7% +4.8% Non-controlling interests Poland and Mozambique -74.3-103.7 Exchange rate effect 34.3 -- Total contribution international operations 176.5 172.8-2.1% On a comparable basis: Millennium Poland shareholding at 50.1% in 1Q15 170.8 172.8 +1.2% Same as above without FX effect 136.5 172.8 +26.6% ROE * Contribution of the Angolan operation. Significant FX impact 176.5-5.7-34.3 +26.6% 136.5 172.8 Contribution 2015 15.4% Poland FX Effect 2015 comparable Contribution 2016 Note: subsidiaries net income presented for 2015 at the same exchange rate as of 2016 for comparison purposes, without FX effect. 43
Poland: growing customer funds Customer funds Loans to Customers (gross) Off-BS funds Other BS funds 13,580 1,538 68 +5.3% +0.5% +33.7% 14,306 1,545 91 +1.2% 10,845 10,971 Term deposits 6,860-13.7% 5,919 Mortgage 6,338-0.5% 6,307 Ondemand deposits 5,114 +32.0% 6,750 Consumer and other Companies 1,283 +10.7% 1,421 3,223 +0.6% 3,243 Dec 15 Dec 16 Dec 15 Dec 16 FX effect excluded. /Zloty constant at December 2016 levels: Income Statement 4.37562917; Balance Sheet 4.4103. 44
New banking tax and Visa Europe transaction strongly impact net earnings Net income Banking income ROE 9.1% 10.4% +28.3% 160.3 124.9 461.0 +22.6% 565.0 Operating costs 248.4 +2.3% 254.2 Net earnings increased by 28.3%, as the new banking tax ( 39.8 million) was more than compensated by the aggregate net impact in the amount ( 46.5 million) of the gains on the Visa transaction with booking additional provisions Increasing in banking income (22.6%), driven by the gains on the Visa transaction and also by the expansion of the net interest income Operating costs up by 2.3% Common equity tier 1 ratio of 17.3% at the end of December 2016 FX effect excluded. /Zloty constant at December 2016 levels: Income Statement 4.37562917; Balance Sheet 4.4103. 45
Increase in net interest income and Visa Europe transaction impact Net interest income* Operating costs NIM 2.2% 2.4% Cost to income 53.9% 45.0% +9.7% +2.3% 248.4 254.2 324.2 355.7 123.4 +2.5% 126.5 Other admin. costs + depreciation Staff costs 125.0 +2.2% 127.7 Commissions and other income Employees Branches Other 136.8 0.5 +53.0% 209.3 76.5-67 5,911 5,844 411-43 368 Commissions 136.2-2.5% 132.8 Dec 15 Dec 16 Dec 15 Dec 16 * Pro forma data. Margin from derivative products, including those from hedging FX denominated loan portfolio, is included in net interest income, whereas in accounting terms, part of this margin ( 12.2 million in 2015 and 11.6 million in 2016) is presented in net trading income. FX effect excluded. /Zloty constant at December 2016 levels: Income Statement 4.37562917; Balance Sheet 4.4103. 46
Improved credit quality and comfortable coverage NPL>90d Credit ratio Dec 15 Dec 16 NPL>90d 2.8% 2.6% 302 289 Loan loss reserves Coverage ratio Dec 15 Dec 16 NPL>90d 110% 107% 331 309 Dec 15 Dec 16 Dec 15 Dec 16 Loan impairment (net of recoveries) Cost of risk 52bp 49bp -5.0% 54.8 52.1 Improvement of NPL>90d ratio to 2.6% of total credit as at December 31, 2016 from 2.8% on the same date of the previous year Provision coverage of NPL>90d at 107% from 110% year-end 2015 Lower provisioning effort, as reflected by cost of risk decreasing to 49bp (52bp in 2015) FX effect excluded. /Zloty constant at December 2016 levels: Income Statement 4.37562917; Balance Sheet 4.4103. 47
Mozambique: strong volume growth Customer funds Loans to Customers (gross) Term deposits 1,184 512 +9.7% +13.5% 1,299 581 Mortgage Consumer and other 936 13 200 +19.7% -3.2% +0.5% 1,121 13 201 Ondemand deposits 673 +6.7% 718 Companies 723 +25.5% 907 Dec 15 Dec 16 Dec 15 Dec 16 FX effect excluded. /Metical constant at December 2016 levels: Income Statement 69.49270833; Balance Sheet 75.3100. 48
Increasing net income in a complex environment Net income Banking income ROE 19.6% 23.1% +34.3% 71.2 53.0 151.9 +34.4% 204.2 Operating costs +20.2% 66.8 80.2 Net income up by 34.3%, with ROE at 23.1%, in spite of an increased tax burden Increase of 34.4% in banking income due to higher net interest income Operating costs up by 20.2% Capital ratio at 18.8% FX effect excluded. /Metical constant at December 2016 levels: Income Statement 69.49270833; Balance Sheet 75.3100. 49
Growth in core income partially offset by the increase in operating costs Net interest income NIM 6.3% 9.3% +57.7% 139.7 88.6 Operating costs Cost to income 43.9% 39.3% +20.2% 80.2 66.8 +6.3% 7.7 Depreciation 7.2 Other admin. 36.7 29.4 +24.7% costs Staff costs 30.2 +19.1% 35.9 Commissions and other income Employees* Branches Other +1.8% 63.3 64.5 35.0-3.1% 33.9 +51 2,351 2,402 169 +7 176 Commissions 28.4 +7.9% 30.6 Dec 15 Dec 16 * Excludes employees from SIM (insurance company) Dec 15 Dec 16 FX effect excluded. /Metical constant at December 2016 levels: Income Statement 69.49270833; Balance Sheet 75.3100. 50
Stable credit quality and reinforced coverage NPL>90d Credit ratio Dec 15 Dec 16 NPL>90d 6.2% 6.0% Loan loss reserves Coverage ratio Dec 15 Dec 16 NPL>90d 96% 121% 57.9 67.3 55.5 81.6 Dec 15 Dec 16 Dec 15 Dec 16 Loan impairment (net of recoveries) Cost of risk 155bp 195bp 15.7 23.7 NPL>90d ratio of 6.0% as at December 31 st, 2016 with reinforced coverage: 121% as at the same date Increased provisioning effort, as reflected by a 195bp cost of risk in 2016, up from 155bp in 2015 FX effect excluded. /Metical constant at December 2016 levels: Income Statement 69.49270833; Balance Sheet 75.3100. 51
Agenda Highlights Group Profitability Liquidity Capital Portugal International operations Conclusions 52
Road to 2018: targets Consolidated 2018 CT1 / CET1 13.3% phased 10.2% fully 12.8%* phased 11.1%* fully 11% Loans to Deposits 102% 98% < 100% Cost Income** 53.0% 48.5% < 43% Cost Core Income** 54.6% 51.5% < 50% Cost of risk 150 bp 216 bp < 75 bp ROE 5.3% 0.6% 10% With CET1 fully implemented of 11% *Estimated values on January 1, 2017, including the impact of the capital increase and the full reimbursement of CoCos, both concluded on February 2017. **Core income = net interest income + net fees and commission income. Excluding non-usual items. Cost-income including non-usual items: 44.2% in 2015, 37.2% in 2016; cost-core-income including non-usual items: 55.0% in 2015, 41.6% in 2016. 53
Millennium bcp: a bank focused on its values and ready for the future 1 Balance sheet strengthened by the recent share capital increase, that, as a result of the efforts by Shareholders and by all other Stakeholders, permitted CoCos to be repaid and the strategic independence of the Bank to be regained, with a zero cost for Portuguese taxpayers Unique position in Portuguese banking 2 Largest private sector bank based in Portugal with a balanced shareholder structure with strong Portuguese presence 3 Profitable operation with recurring capacity to generate operating results in excess of 1 billion per annum 4 Well-positioned in a rapidly changing landscape, following the completion of the restructuring plan successfully implemented over the last years 5 Prepared to support individuals and companies 54
Appendix 55
Sovereign debt portfolio Sovereign debt portfolio Sovereign debt maturity Dec 15 Sep 16 Dec 16 YoY QoQ Portugal 3,865 4,355 4,124 +7% -5% T-bills 881 827 655-26% -21% >8years, 10years 5% >5years, 8years 27% >10years 0% 1year 21% Bonds 2,984 3,528 3,469 +16% -2% Poland 2,312 3,406 3,324 +44% -2% Angola 579 0 0 Mozambique 472 246 228-52% -7% Other 91 89 90-1% +1% Total 7,319 8,097 7,765 +6% -4% >2years, 5years 27% >1year, 2years 20% Sovereign debt portfolio totals 7.8 billion, 1.7 billion of which maturing in less than 1 year The value of Portuguese and Polish sovereign portfolios increased from December 31 st 2015; exposure to Angolan and Mozambican sovereign debt decreased 56
Sovereign debt portfolio Portugal Poland Mozambique Other Total Trading book* 164 71 0 37 273 1 year 6 28 0 36 70 > 1 year and 2 years 118 2 0 0 121 > 2 years and 5 years 37 23 0 0 60 > 5 years and 8 years 1 16 0 0 17 > 8 years and 10 years 2 2 0 0 4 > 10 years 0 0 0 0 1 Banking book** 3,960 3,252 228 53 7,492 1 year 704 771 119 0 1,595 > 1 year and 2 years 301 1,090 20 51 1,461 > 2 years and 5 years 556 1,361 88 0 2,006 > 5 years and 8 years 2,061 12 0 1 2,074 > 8 years and 10 years 337 18 0 1 355 > 10 years 1 0 0 0 1 Total 4,124 3,324 228 90 7,765 1 year 710 799 119 36 1,665 > 1 year and 2 years 419 1,092 20 51 1,582 > 2 years and 5 years 593 1,384 88 0 2,066 > 5 years and 8 years 2,062 28 0 1 2,091 > 8 years and 10 years 339 20 0 1 359 > 10 years 1 0 0 1 2 * Includes financial assets held for trading at fair value through net income ( 147 million). ** Includes AFS portfolio ( 7,340 million) and HTM portfolio ( 50 million). 57
The NPE reduction plan is being implemented (Billion euros) NPEs down > 4 billion from end-2013 NPEs per year of origination 72% 18% 10% 100% 12.8 +0.9 8.5-1.2 +1.5-2.5-0.6 8.5 6.1 Dec 13 Net new entries Write offs Sales Dec 16 <2008 2008-2010 >2011 Dec 16 * 9 months following payment is resumed for loans to companies, 3 months for retail loans. 58
Diversified and collaterised portfolio Loan portfolio Consolidated Companies 46% Loans by collateral Mortgage 46% 55% 27% 19% Real guarantees Other guarantees Unsecured LTV of mortgage portfolio in Portugal 15% 10% 13% 27% 11% 13% 12% Consumer / other 8% 0-40 40-50 50-60 60-75 75-80 80-90 >90 Loans to companies accounted for 46% of the loan portfolio at December 31, 2016, including 8% to construction and real-estate sectors 82% of the loan portfolio is collateralised Mortgage accounted for 46% of the loan portfolio, with low delinquency levels and an average LTV of 66% Real estate accounts for 95% of total collateral value 80% of the real estate collateral is residential 59
Consolidated earnings (million euros) Impact on earnings Net interest income 1,190.6 1,230.1 +39.5 Net fees and commissions 660.3 643.8-16.4 Other operating income 452.7 222.7-229.9 Of which: Visa transaction 0.0 96.2 +96.2 Of which: Capital gains on Portuguese sovereign debt 396.3 10.0-386.3 Banking income 2,303.5 2,096.7-206.8 Staff costs -573.9-356.6 +217.3 Of which: Impact from rev. collective agreement, net of rest. costs -5.8 185.7 +191.6 Other administrative costs and depreciation -443.4-423.4 +20.0 Operating costs -1,017.3-780.0 +237.3 Operating net income (before impairment and provisions) 1,286.2 1,316.7 +30.5 Of which: core net income 833.6 1,094.0 +260.4 Loans impairment (net of recoveries) -817.8-1,116.9-299.1 Other impairment and provisions -160.1-481.1-321.0 Of which: Devaluation of corporate restructuring funds -25.2-224.2-199.0 Of which: Devaluation of goodwill 0.0-51.0-51.0 Impairment and provisions -977.9-1,598.0-620.1 Net income before income tax 308.3-281.3-589.6 Income taxes -37.7 381.9 +419.6 Of which: Fiscal impact 0.0 281.2 +281.2 Non-controlling interests -125.6-121.9 +3.7 Net income from discontinued or to be discontinued operations 90.3 45.2-45.1 Net income 235.3 23.9-211.4 60
Consolidated balance sheet 31 December 2016 31 December 2015 Assets Cash and deposits at central banks 1,573.9 1,840.3 Loans and advances to credit institutions Repayable on demand 448.2 776.4 Other loans and advances 1,056.7 921.6 Loans and advances to customers 48,017.6 51,970.2 Financial assets held for trading 1,048.8 1,188.8 Other financial assets held for trading at fair value through profit or loss 144.9 144.9 Financial assets available for sale 10,596.3 10,779.0 Assets with repurchase agreement 20.5 - Hedging derivatives 57.0 73.1 Financial assets held to maturity 511.2 494.9 Investments in associated companies 598.9 315.7 Non current assets held for sale 2,250.2 1,765.4 Investment property 12.7 146.3 Property and equipment 473.9 670.9 Goodwill and intangible assets 162.1 210.9 Current tax assets 17.5 43.6 Deferred tax assets 3,184.9 2,561.5 Other assets 1,087.8 974.2 71,264.8 74,884.9 31 December 2016 31 December 2015 Liabilities Amounts owed to credit institutions 9,938.4 8,591.0 Amounts owed to customers 48,797.6 51,538.6 Debt securities 3,512.8 4,768.3 Financial liabilities held for trading 547.6 723.2 Hedging derivatives 384.0 541.2 Provisions for liabilities and charges 321.1 284.8 Subordinated debt 1,544.6 1,645.4 Current income tax liabilities 35.4 22.3 Deferred income tax liabilities 2.7 14.8 Other liabilities 915.5 1,074.7 Total Liabilities 65,999.6 69,204.3 Equity Share capital 4,268.8 4,094.2 Treasury stock (2.9) (1.2) Share premium 16.5 16.5 Preference shares 59.9 59.9 Other capital instruments 2.9 2.9 Legal and statutory reserves 245.9 223.3 Fair value reserves (130.6) 23.3 Reserves and retained earnings (102.3) (31.0) Net income for the year attrib. to Shareholders 23.9 235.3 Total equity attrib. to Shareholders of the Bank 4,382.1 4,623.2 Non-controlling interests 883.1 1,057.4 Total Equity 5,265.2 5,680.6 71,264.8 74,884.9 61
Consolidated income statement Per quarter Quarterly 4Q 15 1Q 16 2Q 16 3Q 16 4Q 16 Net interest income 314.0 292.4 308.4 306.2 323.1 Dividends from equity instruments 6.2 2.0 3.8 1.2 0.8 Net fees and commission income 162.3 163.9 156.4 160.8 162.7 Other operating income -66.4-12.4-75.6-8.3-9.5 Net trading income 33.5 28.3 154.5 29.7 27.9 Equity accounted earnings -1.6 13.9 23.8 22.9 19.9 Banking income 447.9 488.1 571.3 512.5 524.8 Staff costs 143.7 138.4 135.2 136.7-53.8 Other administrative costs 100.0 91.8 93.1 90.1 98.6 Depreciation 13.1 12.8 12.7 11.5 12.8 Operating costs 256.8 243.1 241.0 238.3 57.6 Operating net income bef. imp. 191.1 245.1 330.3 274.2 467.2 Loans impairment (net of recoveries) 204.2 160.7 458.0 251.5 246.7 Other impairm. and provisions 43.0 15.4 182.6 44.9 238.2 Net income before income tax -56.1 69.1-310.3-22.2-17.8 Income tax -29.4 15.0-93.3 10.1-313.7 Non-controlling interests 20.7 36.4 43.1 21.5 20.8 Net income (before disc. oper.) -47.3 17.7-260.2-53.8 275.0 Net income arising from discont. operations 18.1 29.0 16.2 0.0 0.0 Net income -29.2 46.7-243.9-53.8 275.0 62
Consolidated income statement Per quarter (million euros) 3Q16 4Q16 Impact on earnings Core net income 228.7 242.4 +13.8 Other operating income 45.4 23.8-21.6 Operating net income (bef. impairment and provisions) 274.1 266.2-7.9 Impairment and provisions -194.1-242.5-48.3 Net income before income tax 80.0 23.8-56.2 Income taxes, non-controlling interests and disc. operations -61.8-0.6 +61.1 Net income excluding non-usual items 18.2 23.1 +4.9 Non-usual items, net of taxes -72.1 251.9 +323.9 Net income -53.8 275.0 +328.8 63
Income statement (Portugal and International operations) For the 12-month periods ended 31 th December, 2015 and 2016 International operations Group P ortugal Total Bank M illennium (P oland) M illennium bim (M o z.) Other int. operations D ec 15 D ec 16 Δ % D ec 15 D ec 16 Δ % D ec 15 D ec 16 Δ % D ec 15 D ec 16 Δ % D ec 15 D ec 16 Δ % D ec 15 D ec 16 Δ % Interest income 2,159 1,910-11.5% 1,379 1,172-15.0% 780 738-5.4% 553 520-5.9% 221 211-4.4% 6 6 6.2% Interest expense 968 680-29.8% 668 436-34.7% 301 244-18.9% 227 176-22.2% 80 72-10.9% -6-4 35.9% Net interest income 1,191 1,230 3.3% 711 736 3.5% 479 494 3.1% 326 344 5.4% 141 140-0.7% 12 10-15.6% Dividends from equity instruments 10 8-20.1% 9 7-20.1% 1 0-20.0% 1 0-19.6% 0 0-25.5% 0 0 -- Intermediation margin 1,200 1,238 3.1% 720 743 3.2% 480 494 3.0% 327 345 5.4% 141 140-0.7% 12 10-15.6% Net fees and commission income 660 644-2.5% 448 457 1.9% 212 187-11.7% 143 133-6.9% 45 31-32.1% 24 24-2.4% Other operating income -120-106 11.7% -84-42 50.4% -36-64 -78.7% -51-72 -41.9% 16 9-44.8% -1-1 13.1% Basic income 1,741 1,776 2.0% 1,085 1,158 6.8% 656 618-5.9% 419 405-3.2% 202 179-11.2% 36 33-6.6% Net trading income 539 240-55.4% 443 100-77.4% 96 140 45.6% 52 112 >100% 40 25-36.8% 4 3-28.1% Equity accounted earnings 24 81 >100% 24 68 >100% 0 13 >100% 0 0 5.1% 0 0 -- 0 13 -- Banking income 2,304 2,097-9.0% 1,552 1,326-14.5% 752 771 2.5% 470 516 9.8% 241 204-15.4% 40 50 24.1% Staff costs 574 357-37.9% 377 176-53.3% 197 181-8.4% 131 128-2.4% 48 36-25.1% 18 17-7.5% Other administrative costs 389 374-4.0% 237 233-1.7% 153 141-7.7% 100 98-1.3% 47 37-21.5% 6 6-5.6% Depreciation 54 50-7.9% 30 29-2.9% 24 20-14.2% 12 13 3.9% 11 8-33.1% 0 0-26.4% Operating costs 1,017 780-23.3% 644 438-31.9% 373 342-8.5% 242 238-1.6% 106 80-24.4% 25 23-7.2% Operating net income bef. imp. 1,286 1,317 2.4% 908 888-2.2% 379 429 13.3% 228 278 22.0% 135 124-8.4% 15 27 74.8% Loans impairment (net of recoveries) 818 1,117 36.6% 730 1,045 43.2% 88 72-18.6% 61 50-18.0% 25 24-5.3% 2-2 <-100% Other impairm. and provisions 160 481 >100% 153 471 >100% 7 10 41.8% 3 10 >100% 4 0 <-100% 0 0 75.5% Net income before income tax 308-281 <-100% 25-628 <-100% 283 347 22.4% 164 218 32.5% 106 100-5.2% 13 28 >100% Income tax 38-382 <-100% -18-470 <-100% 56 88 56.2% 34 58 70.8% 20 28 37.8% 2 2-3.4% Non-controlling interests 126 122-3.0% -1-1 -82.6% 126 123-2.6% 0 0 -- 1 1-22.9% 125 122-2.4% Net income (before disc. oper.) 145-21 <-100% 44-157 <-100% 101 136 34.9% 131 160 22.6% 84 71-15.4% -114-95 16.3% Net income arising from discont. operations 90 45-49.9% 76 37-51.4% 76 37-51.4% Net income 235 24-89.8% 177 173-2.1% -38-59 -52.7% 64
Glossary (1/2) Capitalisation products includes unit linked saving products and retirement saving plans ( PPR, PPE and PPR/E ). Commercial gap total loans to customers net of BS impairments accumulated minus on-balance sheet customer funds. Cost of risk, gross (expressed in bp)- ratio of impairment charges accounted in the period to customer loans (gross). Cost of risk, net (expressed in bp)- ratio of impairment charges (net of recoveries) accounted to customer loans (gross). Cost to income operating costs divided by net operating revenues. Cost to core income - operating costs divided by the net interest income and net fees and commission income. Core income - net interest income plus net fees and commission income. Core net income - corresponding to net interest income plus net commissions deducted from operating costs. Coverage of credit at risk by balance sheet impairments total BS impairments accumulated for risks of credit divided by credit at risk (gross) Coverage of credit at risk by balance sheet impairments and real/financial guarantees total BS impairments accumulated for risks of credit plus real and financial guarantees divided by credit at risk (gross). Coverage of non-performing loans by balance sheet impairments total BS impairments accumulated for risks of credit divided by NPL Credit at risk definition broader than the non performing loans which includes also restructured loans whose changes from initial terms have resulted in the bank being in a higher risk position than previously; restructured loans which have resulted in the bank becoming in a lower risk position (e.g. reinforced collateral) are not included in credit at risk. Credit at risk (net) credit at risk deducted from BS impairments accumulated for risks of credit. Customer spread Difference between the spread on the loans to customers book over 3 months Euribor and the spread on the customers deposits portfolio over 3 months Euribor. Debt securities - debt securities issued by the Bank and placed with customers. Dividends from equity instruments - dividends received from investments in financial assets held for trading and available for sale. Equity accounted earnings - results appropriated by the Group related to the consolidation of entities where, despite having a significant influence, the Group does not control the financial and operational policies. Loan book spread - average spread on the loan portfolio over 3 months Euribor. Loan to value ratio (LTV) Mortgage amount divided by the appraised value of property. Loan to Deposits ratio (LTD) Total loans to customers net of accumulated BS impairments for risks of credit to total customer deposits. Net interest margin - net interest income for the period as a percentage of average interest earning assets. Net operating revenues - net interest income, dividends from equity instruments, net commissions, net trading income, equity accounted earnings and other net operating income. Net trading income - net gains/losses arising from trading and hedging activities, net gains/losses arising from available for sale financial assets, net gains/losses arising from financial assets held to maturity. Non-performing exposures (according to EBA definition) Non-performing loans and advances to customers more than 90 days past-due or unlikely to be paid without collateral realisation, even if they recognised as defaulted or impaired. Considers also all the exposures if the on-bs 90 days past due reaches 20% of the outstanding amount of total on-bs exposure of the debtor, even if no pull effect is used for default or impairment classification. Includes also the loans in quarantine period over which the debtor has to prove its ability to meet the restructured conditions, even if forbearance has led to the exit form default or impairments classes. Non-performing exposures coverage ratio Total BS impairments plus collaterals and expected loss gap divided by non-performing exposures. 65
Glossary (2/2) Non-performing loans Overdue loans more than 90 days including the non-overdue remaining principal of loans, i.e. portion in arrears, plus non-overdue remaining principal. Non-performing loans ratio (net) Loans more than 90 days overdue and doubtful loans reclassified as overdue for provisioning purposes less BS impairments accumulated for credit risk divided by total loans (gross). Non-performing loans coverage ratio Total BS impairments accumulated for credit risk divided by overdue and doubtful loans divided. Loans losses reserves - Total BS impairments. Loans more than 90 days overdue coverage - total BS impairments accumulated for risk of credit divided by total amount of loans overdue with instalments of capital and interest overdue more than 90 days. Operating costs - staff costs, other administrative costs and depreciation. Other impairment and provisions - other financial assets impairment, other assets impairment, in particular provision charges related to assets received as payment in kind not fully covered by collateral, goodwill impairment and other provisions. Other net income net commissions, net trading income, other net operating income, dividends from equity instruments and equity accounted earnings. Other net operating income - other operating income, other net income from non-banking activities and gains from the sale of subsidiaries and other assets. Overdue loans - loans in arrears, not including the non-overdue remaining principal. Overdue loans coverage ratio total BS impairments accumulated for risks of credit divided by total amount of loans overdue with instalments of capital and interest overdue. Overdue and doubtful loans - loans overdue by more than 90 days and the doubtful loans reclassified as overdue loans for provisioning purposes. Return on equity (ROE) Net income divided by the average attributable equity, deducted from preference shares and other capital instruments. Return on average assets (ROA) Net income divided by the average total assets. Securities portfolio - financial assets held for trading, financial assets available for sale, assets with repurchase agreement, financial assets held to maturity and other financial assets held for trading at fair value through net income. Spread on term deposits portfolio average spread on terms deposits portfolio over 3 months Euribor. Tangible Equity Shareholders equity minus goodwill and intangible assets. Texas ratio Non performing exposures divided by the sum of Tangible equity and Loan Losses Reserves i.e. NPE / (Tangible equity + LLRs). Total customer funds - amounts due to customers (including debt securities), assets under management and capitalisation products. Total operating income net interest income, dividends from equity instruments, net fees and commissions income, trading income, equity accounted earnings and other operating income. 66
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