Liberbank : Presentación de resultados correspondiente al segundo trimestre de 2017

27th July 2017

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 Decisive proactive actions on legacy assets with best-in class track record

 Solvency keeps improving and liquidity position remains strong

 Good development of the commercial activity

 NPLs down € 395m QoQ. NPL ratio drops to 11.3%, 171bp down QoQ. We review down our previous guidance and expect NPL ratio to stand at

 Sales of foreclosed assets of € 75m in the quarter, historical record, with capital gains of € 6m.

 Total NPAs down € 380m in the quarter, 6.3% QoQ and 19% YoY.

NPA ratio target of c.20% in 2017, c.16% in 2018 and c.12.5% in 2019. Wholesale transactions would accelerate the plan further.

 Liberbank has received several binding offers up to € 85m to outsource the management of its RE assets.

 Positive impact on future profitability and stable partnership with a prestigious industrial partner to strengthen the entity's strategy of boosting the sale of RE assets.

 The RE servicer commits to fulfill an ambitious divestment Plan (€ 410m, € 625 and € 850m in 2017-18-19 respectively(1)).

 The CET1 ratio stands at 12.4% and 11.3% (+25bp QoQ) under phased-in and fully loaded Basel III criteria. Total capital ratio (phased-in) stands at 14.3%, well above regulatory requirements.

 Migration to IRB models calendar well on track. Liberbank estimates, subject to the ECB approval, the RWAs on the mortgage portfolio could fall by more than Eur 3.0bn.

(1) Gross sales and rents 3

 Liberbank maintains a strong liquidity position, LCR ratio stands at c.300% and LtD at 90% as of jun-17.

 96.5% of the deposits are retail, granular, sticky and with low average balance.

 Liberbank reached an agreement with JP Morgan Asset Management to distribute their products through our branch network.

 Plan to increase AuMs from € 2.5bn to € 4.5bn.

 Mortgages performing loan book starts to grow (+0.8% QoQ) while consumer book and corporate book (exc RED&construction) maintain a strong growth (+9.7% and

+5.4% YoY respectively).

 Customer spread keeps improving, +2bp QoQ and non-banking recurrent fees improve 9% YoY.

 Bank well-positioned for interest rate recovery.

 Ability to improve profitability in the Fixed Income portfolio.

 Costs remain under control. Liberbank continues to apply different initiatives to reduce costs further.

 Recurrent loan impairments well below 40bp target.

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