CREDEM, 9M17 consolidated results: 76 thousand new customers, net profit +42.1% yoy at €146.5 mln, cet1 ratio at 13.37%

ORGANIC GROWTH:

• More than 76 thousand new customers(1);

• Group Customers' Funding (3) at €65.6 billion (+7.1% YoY, +€4.3 billion in value), out of which Assets Under Management( (3) at €26.8 billion (+11.8 % YoY) and Insurance Reserves at €6.7 billion (+6.5% YoY);

• ECB included Credem Group among financial conglomerates as a result of the size achieved.

  FOCUS ON HR EXCELLENCE:

• 200 hirings (4) in 9M17, out of which 75% were young professionals;

• Group's total headcount increased by 1% YoY.

  SUPPORT TO THE ECONOMY:

• Loans (3) ) to Customers up by 6.9% YoY (compared to an industry performance of

  +1.3YoY(5)) at €23.5 billion (+1.5 billion YoY in value).

  CREDIT QUALITY AND CAPITAL SOUNDNESS:

• Net Bad Loans Ratio at 1.43% among the best performers in the Italian banking industry;

• CET1 Ratio(2) at 13.37%, more than 660 bps above the minimum regulatory requirement outlined by the ECB for 2017 (SREP(6) at 6.75%, the lowest among Italian Banks supervised by the ECB).

  CONSISTENT PROFITABILITY:

• Net Profit of the Period +42.1% YoY at €146.5 million;

"Our steady customers' base growth over time", Nazzareno Gregori, Credem's General Manager declared "proves that our distinctive peculiarities, such as solidity, fairness and a complete product range, are key to compete. The inclusion among financial conglomerates and the additional ECB supervision", Gregori continued, "represent a further step in the growth path realized by means of effective investments that allowed the Group to reach a larger size and expand its product range. During the next quarters" Gregori concluded " we will convincingly continue to invest on people and technology, as we do believe that in the near future there will still be further significant room for growth, especially in areas such as protection solutions for our customers, both retail and corporate, and their assets. Other major focus remain asset management and lending, where we can boast a long standing competence".

More than 76 thousand new customers(1), 200 hirings(4) out of which 75% were young professionals, Group Customers' Funding(3) +7.1% YoY (AUM(3) +11.8% YoY, Insurance Reserves +6.5% YoY), Loans to Customers(3) up by 6.9% YoY (compared to an industry performance of +1.3YoY(5)), Net Bad Loans Ratio at 1.43%, CET1 Ratio(2) a 13.37% and Net Profit of the Period +42.1% YoY at €146.5 million. These are the main highlights of 9M17 individual and consolidated Credem Group results approved today by Credem's Board of Directors, chaired by Giorgio Ferrari. Indicators confirmed the effectiveness of the organic growth strategy carried out by the Group with strong investments on people and technology, in order to support the commercial activity and allow the acquisition of new customers. The Group continued to sustain the Italian economy, with a strong support to households and enterprises, while maintaining a strong focus on credit quality and capital soundness, with the ultimate goal of confirming profitability among the top performers in the industry.

Operating Income was up by 6.3% YoY at €850.6 million compared to €800.4 million in 9M16. Within this aggregate, Interest Margin (8) was €355.3 million, +5% compared to €338.3 million in 9M16. Non Interest Margin (9)(10) was up by 7.2% YoY, at €495.3 million compared to €462.1 million in 9M16. In detail, Net Commissions were overall up by 8.8% YoY at €387.6 million with a positive contribution coming from management and brokerage fees up by +17.3% YoY at

€254.8 million, while banking fees declined by 4.4% YoY at €132.8 million. The contribution from financial activity was up by 10.6% YoY at €58.5 million, while revenues attributable to the insurance activity decreased slightly by 1.1% YoY at €36.8 million.

Operating Costs(10) were €539.2 million (+1.4% YoY compared to €531.9 million in 9M16), in line with the Group's strategic planning to support Group's size growth, the commercial salesforces' expansion and to face the recent evolution of the regulatory framework. In detail, Administrative Expenses were €170.8 million (-1.3% YoY), whereas Payroll amounted to €368.4 million (+2.6% YoY).

Cost/Income Ratio was 63.4%, down compared to 66.5% in 9M16 and compared to 64.4% in FY16.

Gross Operating Profit reached €311.4 million, +16% compared to €268.5 million in 9M16.

D&A equalled €36.1 million compared to €33.9 million in 9M16 (+6.5% YoY).

Operating Profit was €275.3 million, +17.3% YoY compared to €234.6 million in 9M16.

Provisions for Risk and Charges showed a positive balance of €0.8 million (-€7.4 million in 9M16). Net Adjustments to Loans were down by 16.7% YoY at €39.3 million compared to

€47.2 million in 9M16.

Net Extraordinary Income/Charges were -€20.9 million compared to -€27.3 million in 9M16, including, among others, a €19.8 million provision to the Single Resolution Fund and the Deposit Guaranteed Scheme, gross of fiscal effect.

Profit before Tax was €215.9 million, +41.4% compared to €152.7 million in 9M16. Income Taxes for the Period were €69.4 million (€49.6 million in 9M16, +39.9% YoY). Net Consolidated Profit for the Period was €146.5 million, up by 42.1% compared to €103.1 million in 9M16.

Group Customers' Funding at the end of 9M17 was up by 7.1% YoY at €65,610 million (€61.278 million at the end of 9M16). Group's Total Funding was €77,526 million, +7.9% YoY compared to €71,847 million at the end of 9M16. In detail, Direct Deposits from Customers grew by 3.7% YoY at €21,401 million compared to €20,647 million at the end of 9M16. Group Direct Deposits were €23,901 million compared to €22,997 million at the end of 9M16 (+3.9% YoY). Insurance Reserves reached €6,660 million, +6.5% compared to €6,252 million at the end of 9M16. Indirect Deposits from clientele amounted to €37,549 million, +9.2% compared to €34,379 million at the end of 9M16. In detail, AUM grew by 11.8% YoY at €26,841 million compared to €24,001 million at the end of 9M16, with Portfolio Management Accounts at €6,780 million (+13.6% YoY) and Mutual Funds and SICAVs at €11,922 million (+7.5% YoY).

Loans to Customers were up by 6.9% YoY overperforming the industry by more than 5 percentage points as loans increased for the industry by 1.3% YoY(5) and thus reaching €23,474 million compared to €21,966 million at the end of 9M16, while maintaining an excellent credit quality.

Net Bad Loans Ratio was 1.43%, compared to 1.65% at the end of 9M16, significantly below the industry average. Bad Loans' coverage was 60.9% (61.4% in 9M16 e 59.6% in FY16). Net Non Performing Loans were €782.8 million compared to €832.8 million at the end of 9M16.

Credemholding phased-in CET1 Ratio (2) at the end of 9M17 was 13.37% (fully phased 12.81%); phased-in Tier 1 capital Ratio(2) was 13.38% (fully phased 13.15%); phased-in Total Capital Ratio(2) was 15.07% (fully phased 15.02%). The minumum CET1 Ratio required by the ECB to Credem Group, within the Supervisory Review and Evaluation Process (SREP) for 2017 was 6.75%(6), the lowest among Italian banks directly supervised by ECB.

At the end of 9M17, Credem Group's distribution network consisted of 692 branches, corporate centers, small business centers and financial stores, with 6.134 employees, 837 financial advisors with mandate, 217 Creacasa agents and 97 agents with exclusive mandate for "salary backed loans".

Within a still particularly weak macroeconomic environment, characterized by an high level of volatility related to both political turmoil and uncertain expectations on GDP, as well as unknown impacts of new regulatory and supervisory measures, Group's objectives are confirmed. In detail, they can be outlined in: the commercial expansion of the business, the revision of the service model towards omni-channel and digitization, the strenghtening of the Wealth Management and the maintenance of significant levels of investment to support the evolution of the IT system as well as regulatory and compliance issues. It is also confirmed the Group's determination to preserve its solid risk profile and its sound capital position alongside a further securities portfolio's diversification.

Against this backdrop, given the systemic uncertainties already highlighted and a growing competition that could penalize credit spreads, Group's revenues are expected to follow a linear path in terms of recurrent components of both Interest Margin and Fees & Commission. This trend, though, could be blurred by some elements of possible discontinuity, such as a greater stability on financial market (as experienced in the last couple of quarters), which will allegedly squeeze the contribution from financial activity. Similarly, on the back of the general indications provided by the Supervisor related to the treatment of non performing loans, a substantial increase of the coverage could materialize in the next few quarters. The level of the investments is expected to remain in line with the one performed over the last quarters.

As of today, no extraordinary events that can materially alter the economic dynamics of the last quarter of the year are expected to occur, besides the already highlighted elements of uncertainty.

As at October 6th, 2017, the European Central Bank (ECB) announced the decision to include Credem Group among Italian groups with significant business activities both in the banking, wealth management and insurance industries (financial conglomerates). The inclusion within the list of financial conglomerates foresees a further supervision by the ECB, which is additional to the activity of the other sectorial supervising authorities as well as to the one already carried out by the ECB over the Group - as a significant financial institution - within the Single Supervisory Mechanism (SSM) starting from January 1st, 2016, in order to reinforce Group's customers protection.

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Following the recent changes to Testo Unico della Finanza (TUF) regulation, Credito Emiliano on a voluntary basis discloses its quarterly Financial Report as at September 30th 2017 in order to remain consistent with the previous releases. This adopted option does not imply any future obligation for the Group to prepare and release quarterly reports.

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In accordance with paragraph 2 of Article 154 bis of the Consolidated Law on Finance, the Financial Reporting Manager Paolo Tommasini declares that the accounting information, both individual and consolidated, contained in this press release corresponds to document results, books and accounting records.

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Find here attached the consolidated balance sheet and income statement as well as the reclassified consolidated P&L. The consolidated 9M17 report, not subject to independent audit, will be soon available to the public in due terms. A presentation that illustrates 9M17 consolidated Group results will be soon available in the section "Investor Relations" of Credem's website www.credem.it

For additional information about Credem and other companies of the Group, please visit Credem website www.credem.it

(*) ALTERNATIVE PERFORMANCE MEASURES

Credem Group adopts a set of Alternative Performance Measures ("APMs")) in order to enhance a deeper comprehension of the information regarding the economic and financial trends. At the following link is available a table illustrating the definition and the calculation of each APM used by the Group, as well as a reconciliation with the lines in the financial reports and related comments.

NOTES:

1. Data referred to Credem Spa only;

2. phased-in figures. On the back of article 11, comma 2, 3, and 13 of the EU regulation n. 575/2013 (CRR), banks controlled by a financial holding are requested to meet the requirements set by such a regulation on the base of the consolidated accounts of the holding. Because of this rule on capital Ratios, the consolidation perimeter of the Group was changed, within the framework set by the prudential supervision of the regulator. Therefore, capital Ratios were calculated on Credemholding, which holds 77.3% of Credem Spa share capital;

3. loans to Customers do not include repos with the Cassa di Compensazione e Garanzia. Group's Direct Deposits include the contribution of all companies belonging to the banking group, while Insurance Reserves include Credemvita's technical reserves and financial liabilities valued at fair value. Regarding Customers' Funding, bonds issued to institutional investors and indirect deposits from financial institutions are deducted from the total. Group Customers' Funding includes Insurance Reserves;

4. data referred to Credito Emiliano Spa only, net of intergroup and other movements;

5. source ABI Monthlly Outlook - Economia e Mercati Finanziari - Creditizi, October 2017 - Summary: https://www.abi.it/DOC_Mercati/Analisi/Scenario-e-previsioni/ABI-Monthly- outlook/Sintesi%20ottobre%202017%20st.pdf;

6. such value includes: i) the minimum requirement as stated by the Art. 92(1)(a) of the Capital Requirements Regulation (CRR) 575/2013; ii) the requirement fixed by the Bank of Italy as capital conservation buffer and equal to 1.25% in 2017 as defined in the Circolare n. 285 issued on 12/17/2013 - 18° update (https://www.bancaditalia.it/compiti/stabilita-finanziaria/politica- macroprudenziale/documenti/Comunicato_web_CCoB_-_IT.pdf); iii) the additional requirement as per Art. 16(2)(a) of Directive 1024/2013, requested by the ECB and equal to 1%; iv) the coefficient of the countercyclical capital reserve requested by the Bank of Italyand and equal to 0% for the third quarter 2017 (http://www.bancaditalia.it/media/comunicati/documenti/2017- 01/cs-2017.06.23-CCyB-2017Q3.pdf);