UniCredito Italiano Group
1st Quarter 2002 Results
Alessandro Profumo - CEO
Milan, May 14th 2002
Agenda
1Q2002 Group Highlights
Divisional Reporting
Italian Commercial Banking
Wholesale Banking
Investment Banking
Asset Management
New Europe Banking
Conclusions
2
GOOD INCREASE OF OPERATING INCOME OVER
2001 QUARTERLY AVERAGE THANKS TO REVENUE
GROWTH AND COST CONTROL
TOTAL REVENUES
OPERATING EXPENSES
(Euro mln)
+3.3%
+4.3%
+3.4%
2,457
1Q01
restated
(Euro mln)
+0.4%
2,453
2,537
01 Avg
restated
1Q02
1,242
1Q01
restated
1,289
1,295
01 Avg
restated
1Q02
+2.2%
OPERATING INCOME
(Euro mln)
+6.7%
1,215
1Q01
restated
1,164
01 Avg
restated
1,242
1Q02
3
NON-OPERATING ITEMS IN LINE WITH 1Q2001
RESTATED
 14.3% of Operating Income, of which Euro
174 mln Specific provisions and Euro 4 mln for
possible loan losses
(Euro mln)
+1,242
-64
 0.16% (0.62% Annualised) of Total Net
Customers Loans, in line with 1Q’01
-178
-20
-16
-433
 Tax Rate at 44.9%,
due to the end of
benefits of the
Ciampi Law (1)
-130
+401
Operating Goodwill Net loan Other net Net Extr. Taxes
income
Income
amort. loss prov.
prov.
Minorities
Net
Income
(1) In 2001 the Group made lower provisions for taxes (in line with the prescriptions of the Ciampi Law), resulting in a lower tax rate.
UCI prudentially made equivalent provisions for risks and charges, neutralising tax benefits from the Ciampi Law in the bottom line
4
NET INCOME 10.3% UP ON ‘01 AVERAGE
RESTATED, EFFICIENCY AND PROFITABILITY
STILL AT EXCELLENT LEVELS
-3.1%
NET INCOME
Net income slightly
down vs 1Q’01 restated
(-3.1%) but significantly
higher than 2001 Av.
(+10.3%)
+10.3%
(Euro mln)
414
1Q01
restated
364
01 Avg
restated
401
1Q02
COST/INCOME RATIO %
50.5
1Q01
restated
52.6
01 Avg
restated
ROE %
51.0
20.8
1Q02
1Q01
restated
(1)
18.0
(2)
01 Avg
restated
18.2
(1)
1Q02
(1) Calculated on end of period net equity excluding profit for the period and including profit for the previous period allocated to reserves.
For 1Q’02 deducting also Euro 234 mln of net shareholders’ equity increase to finance the acquisition of ZABA (not yet consolidated).
5
(2) Calculated on end of period net equity (excluding profit for the period)
INCREASED CONTRIBUTION OF WHOLESALE
BANKING AND NEW EUROPE BUSINESSES ...
REVENUE COMPOSITION BY BUSINESS AREA
(Net of infra-Group dividends and of Corporate Centre & Elisions negative contribution)
1Q’01 restated : Euro 2,591 mln
1Q’02: Euro 2,665 mln
0.2%
4.6%
12.6%
4.8%
7.4%
13.5%
10.1%
71.4%
75.4%
Italian Banking
Investment Banking
(UBM+TL)
New Europe Banking
Asset Management
(Pioneer)
New Initiatives
6
... SUPPORTING A GOOD REVENUE INCREASE (3.3%
Y/Y) WITH STRONG PERFORMANCES OF INTEREST
INCOME AND TRADING FROM FINANCIAL
TRANSACTIONS
TOTAL REVENUES BREAKDOWN
(Euro mln)
2,457
+3.3%
2,537
+7.0%
Net interest
income
1,251
1,169
-4.4%
Net commissions
815
Trading from
financial trans.
319
Other income
154
1Q01
restated
779
+3.1%
329
+15.6%
178
1Q02
 Net interest income up
2.7% on quarterly
average 2001
 Diversified mix of
revenues: Net Interest
Income/Total Revenues
still under 50%
Net non interest income
in line with 1Q01 (-0.2%).
Growth in trading profits
and other income partially
offsets the decrease of net
commissions
7
GOOD NET INTEREST INCOME GROWTH DESPITE A
WEAK ECONOMIC CICLE BOTH IN ITALY AND IN
NEW EUROPE
Italian banking
(Euro mln)
Group
 8.1% increase in customer
-1.5%
992 1,004
990
+3.1%
1,170
1,213
1,251
Avg
01
1Q01 (-58 bp vs. avg 2001)
1Q02
+17%
1Q02
The parent company
benefited from the
decrease of interest
rates, reducing the
interest paid on debt
issued and the cost of
equity investments
financing
 57 bp increase of mark up vs. 1Q01
 87 bp reduction of mark down vs.
New Europe
Avg
01
deposits vs. 1Q01 (3.7% on avg
2001 deposits)
(+38bp vs. avg 2001)
1Q01
1Q01
vs. 1Q01 (1.1% on avg 2001 loans)
-0.3%
(at unchanged FX)
+6.9%
 3.1% increase in customer loans
(at unchanged FX)
 18.9% increase in gross retail loans*
+11%
209
221
Based on Bank of Italy Matrix figures
245




1Q01
Avg
01
*Management
1Q02
accounts

vs. 1Q01 (+6.0% on avg 01)
7.2% increase in gross corporate
loans* vs. 1Q01 (+6.0% on avg 01)
2.2% increase in retail deposits* vs.
1Q01 (+0.9% on avg 01)
9.8% increase in corporate deposits*
vs. 1Q01 (+5.7% on avg 01)
Selective lending policy towards less
profitable customers
Widening overall spread between
assets and liabilities
8
NET COMMISSIONS AFFECTED BY THE NEGATIVE
CONTRIBUTION FROM MUTUAL FUNDS
(Euro mln)
NET COMMISSIONS
Asset management
01 Avg* 1Q’02
% ch.
451
419
-7.1
331
287
-13.3
Segregated accounts
63
71
+12.7
Insurance products
57
61
+7.0
Mutual funds
Securities in custody
Other services, of which:
83
83
-
281
277
-1.4
Loans granted & received
120
114
- 5.0
Cash manag. services
100
106
+6.0
815
779
-4.4
TOTAL
 Decrease in Commissions
from Mutual Funds mainly
due to lower sales of
Luxembourg funds and to
the lower share of equity
and balanced funds on total
AuM:
 Av. 1Q02 Equity
Funds 45.3% vs.
Av. 48.3% in 2001
 Av. 1Q02 Balanced
Funds 13.6% vs.
16.4% in 2001
 Still good impact of
capital guaranteed
products on commissions
from segregated accounts
and insurance products
* Consistent with the new Bank of Italy criteria for breakdown of commissions; 1Q’01 restated not available
9
BRILLIANT SALES OF CAPITAL GUARANTEED AND
INSURANCE PRODUCTS IN ITALY SUSTAIN OUR
CONFIDENCE IN MEETING NET COMMISSIONS BUDGET
TARGETS
CAPITAL GUARANTEED PRODUCTS: EURO 2.8 Bn NET
INFLOWS IN 2002, EURO 10.2 Bn FROM LAUNCH TO APR. ‘02
(Euro mln)

Total Group Insurance Portfolio
as at 31.3.02: Euro 13,434 mln,
+7.7% yoy, of which:
Euro 9,452 mln unit-linked
Euro 3,982 mln other
policies

Total New Premiums as at
31.3.02: Euro 1,018 mln, of
which:
Tot: 3,988
4,000
386
3,000
Tot: 1,989
2,734
16
2,000
Tot: 2,038
191
Tot: 1,018
1,242
1,000
0
Tot: 465
1,156
465
386
1Q’01
2Q’01
Fund, Equity &
Index Linked Notes
Tot: 736
Euro
963 mln Single
Premiums
Euro 55 mln Annual
Premiums
94
632
868
731
3Q’01
4Q’01
Segregated
Accounts
691
1Q’02
384
258
April’02
Unit Linked
(UNISTAR)
LIFE INSURANCE

Increased contribution of
annual premiums (Annual/
Total Premiums written: 5.3%,
+150 bp vs. 1Q’01), positively
impacting the profitability of
our sales
10
STILL GOOD RESULTS IN INCOME FROM
FINANCIAL TRANSACTIONS (+3.1% Y/Y)
SUPPORTED BY SOUND RISK MANAGEMENT
INCOME FROM FINANCIAL
TRANSACTIONS
+3.1%
329
(1)
(Euro mln)
319
 Cautious risk management:
(1)
 Euro 4.2 mln Av. Daily
VAR for UBM in 1Q’02
+29.5%
Investment
Banking
(UBM & TL)
 Euro 2.8 mln for TL
179
 Euro 5.5 mln UBM+TL
232
+0.6%
Italian banks
New Europe banks
103
31
1Q’01
(1)
(2)
103
-13.6%
27
 Increased contribution of
CorporateLab, accounting
for around Euro 216 mln
(137 (2) Euro mln inside
UBM and 79 Euro mln
inside the Italian Banking
division). Volumes of
derivatives sold to
corporate customers (3) up
to Euro 8.9 bn (around
46% of total 2001 sales)
1Q’02
Balance due to other Group companies
Of which: Euro 124 mln from Sales, Euro 13 mln from trading
(3)
Excluding large corporate customers
11
OPERATING COSTS IN LINE WITH 2001 QUARTERLY
AVERAGE, +4.3% ON 1Q’01 RESTATED MAINLY DUE T
INCREASED STAFF COSTS
 Staff costs:
(Euro mln)
+4.3%
+0.4%
1,295
1,242
+2.5%
+7.0%
Staff Costs
768
718
434
442
Depreciation
82
1Q01
restated
749
+13.4%
93
1Q02
442
-5.3%
 +0.3% due to the
development of New
Initiatives (Xelion and
Clarima)
 +3.5% due to
strengthening of
commercial units and the
incentivisation program
-1.8%
-1.8%
Other costs
1,289
 +3.2% due to the
development of
Wholesale Banking (IB
and Asset Management)
98
01 Avg
restated
 Total Staff from 63,506
(1Q’01 restated) to 62,288
as of 31.3.2002 (-1.9% y/y)
 Other costs still do not
include the expenses
related to the S3 Project
12
GOOD ASSET QUALITY INDICATORS DESPITE THE
ECONOMIC SLOWDOWN, WITH IMPROVED
COVERAGE RATIOS
Coverage ratios
Net NPLs and Doubtful Loans as %
of Total Net Loans
3.3
3.2
56.2
43.7
1.6
1Q02
Net Doubtful Loans/
Total Net Loans
2001
restated
Net NPLs/
Total Net Loans
Dec.
2001*
1Q’02
Net Doubtful Loans
3,770
3,770
Net NPLs
1,809
1,848
* Restated
44.5
1.6
2001
restated
(Euro mln)
56.7
On Gross
Doubtful Loans
% ch.
on
Dec.’01
+2.1
1Q02
On Gross NPLs
 Slight increase of Net NPLs (+2.1% on
31.12.2001 restated) compensated by
the reduction of other doubtful loans (2.0% on 31.12.2001 restated); stable
Net NPL/Tot. Net Loans Ratio
 Significantly higher Coverage Ratios:
+60 bp on Total Gross NPLs, +80 bp
on Tot. Gross Doubtful Loans, thanks to
conservative provisioning in all the
business areas
13
DIVISIONAL CONTRIBUTION TO GROUP NET
INCOME
GOODWILL AND
HOLDING CHARGES:
(Euro mln)
122(1)
+45.1%
24(1)
+1.2%
54(1)
+13.1%
- 55 goodwill depr.
- 110 holding loss (net of
dividends), of which 95.8 due
to financial costs
-15
N.m.
566
-0.4%
-165(1)
N.m.
401
-3.1%
381(1)
-9.0%
Italian
banking(2)
Inv.
banking(3
)
Pioneer
Group(4)
Wholesale banking
(1)
(2)
(3)
New
Total preNew
Initiatives(6) Corp. Centre
Europe
banking(5)
Net of infragroup dividends. Goodwill depreciation is fully charged to Corp. Centre
Credito Italiano, Rolo Banca 1473, Cariverona, CRT, Cassamarca, Caritro, CRTrieste, Banca
dell’Umbria, CRCarpi, Mediovenezie, BMC, Adalya Banca Imm. Spa, Banque Monegasque,
Unicredit Suisse, BAC Marino, CRTS Zagabria, RoloPioneer Lux, Rolo Pioneer Sgr, Gesticredit,
Gestiveneto, Fondinvest, Pioneer inv. Management SA, S+R Investimenti, Fida Sim, FRT Sim, Fid.
Cordusio, CRV Ireland, CRTS Ireland, Uniriscossioni, Quercia Funding, Unicredit Servizi
informativi, Unicredit Prod. Acc., Trivimm, Quercia Software
UBM, TradingLab, Euro Capital Structures
(4)
(5)
(6)
(7)
Corp.
Centre &
elisions(7
Group
total
)
Group Pioneer Global Asset Management Spa, Unicredit Capital
Italia Spa
Group Pekao, Bulbank, Pol’nobanka, Splitska Banka
Xelion, Clarima
Parent Company, other financial companies and elisions
14
Agenda
1Q2002 Group Highlights
Divisional Reporting
Italian Commercial Banking
Wholesale Banking
Investment Banking
Asset Management
New Europe Banking
Conclusions
15
ITALIAN BANKING DIVISION 1Q RESULTS IN LINE WITH
INTERNAL EXPECTATIONS; SLIGHT DECREASE OF
REVENUES DUE TO LESS FAVOURABLE MARKET
ENVIRONMENT
(Euro mln)
1Q’01
1Q’02
% ch.
Net interest income
992
990
-0.2
Net non interest income
963
913
-5.2
1,955
1,903
-2.7
-948
-953
+0.5
1,007
950
-5.7
-110
-103
-6.4
-20
-23
+15.0
8
-2
N. m.
-377
-355
-5.8
Net income
508
467
-8.1
Net income for the Group
420
381
-9.3
48.5%
50.1%
Total revenues
Administr. costs (incl. depr.)
Operating income
Net loan loss provisions
Other net provisions
Net extraordinary income
Tax expenses
Cost/Income ratio(1)
 Stable interest income
vs. 1Q01
 Decrease in commissions
vs. 1Q01 mainly due to
different asset mix (-24
mln Euro) and lower
commissions from
securities in custody
(-20 mln Euro)
 Stable costs vs. 1Q01,
with tight costs control
expected for 2H02,
resulting from the
merger of the existing 7
banks into a unique
entity
16
SELECTIVE LOAN GROWTH KEEPS ASSET
QUALITY AT EXCELLENT LEVEL
7 MAJOR ITALIAN
BANKS ONLY
2001
1Q’02
% Ch. On
Dec.01
Net Doubtful Loans
2,681
2,709
1.0%
Net NPLs
1,483
1,493
0.7%
2.60%
2.78% +18 bp
3.30%
3.30%
37.8%
37.9% +10 bp
46.3%
46.8% +50 bp
Gross NPL
/Gross Loans
Gross NPL
/Gross Loans T-2
Coverage on Total
Gross Doubtful loans
Coverage on Total
Gross NPLs
-
 Very limited increase of Net Doubtful Loans and NPLs due to the
economic slowdown
 Stable Gross NPL/Gross Loans T-2 Ratio
 Increased Coverage Ratios
17
S3 PROJECT IS WELL ON TRACK
PHASE 1 (JAN - JULY 2002): FROM 7 BANKS
TO THE MERGER IN UCI BANCA
INTERNAL COMMUNICATION

Top Management’s Roadshow in the main Italian towns to meet all 7,500 middle
managers to share the rationale and targets of the S3 Project
LEGAL AND ACCOUNTING

Approved acquisition of the minorities by all the Shareholders’ meetings of the
Italian Banks

Assets and Liabilities of the single banks as well as of the Parent Company
identified

1st July 2002: merger date
ORGANISATION

Organisational charts as well as branch network redesign for all 3 banks
completed

Operational models for the 3 new banks defined

Managing Director and “first line” management of the new 3 banks appointed
18
PHASE 2 (JULY 2002 – JANUARY 2003):
FROM UCI BANCA TO 3 SEGMENT BANKS (RETAIL,
PRIVATE AND CORPORATE)
ORGANISATION
 Complete divisionalisation of UniCredit Banca (headquarters
and network) to be completed by Sep02
COMMERCIAL ALIGNMENT & ENHANCEMENT
 Harmonisation of product ranges, commercial policies,
planning & control tools, credit processing already started;
high value product lines to be aligned by Sep02
IT INTEGRATION
 Completion of IT for new Private and Corporate Bank by
Sep02; fine tuning and customer migration by Dec02
19
Agenda
1Q2002 Group Highlights
Divisional Reporting
Italian Commercial Banking
Wholesale Banking
Investment Banking
Asset Management
New Europe Banking
Conclusions
20
EXCELLENT RESULTS IN INVESTMENT
BANKING, MAINLY DUE TO THE STRONG
GROWTH OF CORPORATE DERIVATIVES
By nature
(Euro mln)
Net Interest margin
% ch.
12
+71
179
232
+30
6
26
+333
192
270
+41
CorporateLab (Corporate Deriv.)
68
137*
+101
Investment & Corporate Banking
4
15
+275
Sales & Trading (incl. Inst. Deriv.)
46
63
+37
TradingLab (Retail Derivatives)
74
55
-26
Staff costs
-19
-30
+58
Other costs
-26
-27
+4
147
213
+45
-4
-5
-60
-86
+43
83
122
+47
Net Commissions
Total revenues
By business
line
1Q’02
7
Trading profits
Operating income
Net provisions & other costs
Tax expenses
Net income
*
1Q’01
N. m.
In 1Q’02 Euro 124 mln from Sales (of which Euro 69 mln through the Italian Network and
Euro 55 through Non-Captive distribution) and Euro 13 mln from Trading
 High growing,
recurring, noncyclical and stressproof Trading Profits
generated by:




CorporateLab
TradingLab
Institutional deriv.
Securities business
 Exceptional results
for CorporateLab:
1Q’02 Revenues
accounting for 62%
of FY’01 Results (Euro
220 mln)
 Significant growth in
Investment and
Corporate Banking,
despite the negative
market scenario
 Excellent C/I Ratio
(21%), 2.3% down
on 1Q’01
21
TRADING RISKS UNDER STRICT CONTROL,
WITH A FURTHER CONSIDERABLE IMPROVEMENT OF
THE AV. DAILY P&L / AV. DAILY VAR RATIO
Avg Daily P&L / Avg Daily VaR
UBM+TL Daily VAR(1) and P&L (Jan. 2001 - Mar. 2002)
Euro mln
17%
1999
8
UBM+TL Daily VAR and P&L
33%
6
No negative daily P&Ls in
2002 up to end of March

More and more efficient
use of VaR Channel: Avg
Daily P&L / Avg Daily VaR
Ratio from 17% in 1999
to 33% in 1Q2002

No negative outliner from 1st
January 2001
-2
-6
02
02
02
/0
3/
02
/0
2/
02
01
/0
1/
02
01
/1
2/
02
01
/1
1/
02
01
/1
0/
02
01
/0
9/
02
01
/0
8/
02
01
/0
7/
02
01
/0
6/
02
01
/0
5/
02
01
/0
4/
02
01
/0
3/
02
/0
2/
02
/0
1/
01
-8
02
1Q02

0
VaR
2001
Low 1Q’02 Average Daily
VAR(1), 12% up vs 4Q’01
(Euro 5.5 mln vs Euro 4.9
mln) due to increased
volumes
2
Daily P&L
2000
23%

4
-4
21%
(1) Figure relates to UBM and TL combined; calculation made with a 98-99% asymmetric double tail confidence interval.
P&L net of accounting adjustments as of 31.12.2001
22
Agenda
1Q2002 Group Highlights
Divisional Reporting
Italian Commercial Banking
Wholesale Banking
Investment Banking
Asset Management
New Europe Banking
Conclusions
23
BRILLIANT NET SALES IN THE US
AND INTERNATIONAL BUSINESS AREAS ...
2001(1)
Net
Sales
Inv.
Perf.(2)
30st Apr.
2002
111,049
+2,478
-1,623
111,904
USA
21,742
+1,836
-940
22,638
Italy
of which Institutional
85,580
-140
-742
84,698
5,731
+276
-156
5,851
International
2,683
+671
+44
3,398
New Europe
1,044
+111
+15
1,170
(Euro mln)
TOTAL PIONEER AuM
(3)
Non Captive/Total AuM(3) - Assets Breakdown
30,71%
32%
29,22%
30%
28%
26%
25,31%
24%
22%
 Record Net Sales in the US (Euro 1.8
bn vs. Euro 1.4 bn in FY01) and
International Division (Euro 671 mln
vs. Euro 596 mln in FY01) and positive
results in New Europe and ItalyInstitutional, completely offsetting
negative sales in the Italian Retail Area
 Increasing “Non Captive” share on
20%
2000
2001
(1) Based on official BCE FX as at 31.12.2001
30 April 2002
(2) Including FX effect
total AuMs
(3)
(3) Excluding Proprietary Funds
24
...AND A STRONG EFFICIENCY
IMPROVEMENT LEADING TO A 30% EBIT INCREASE
1Q02/Av.01
% ch.
1Q02/1Q01
% ch.
+37%
131
130
1Q01
Av.01
+6%
+0.3%
+5%
+1.8%
138
110.5 112.2 112.5
+30%
48
37
35
1Q02
Revenues
1Q01
Av.01
(1)
1Q01
Av.01
Average AuM
1Q02
Managerial EBIT
72% 73%
65%
1Q02
47.3
46.4
1Q01
Av.01
49.1
17.2
13.4
12.5
1Q01
1Q01
Av.01
1Q02
Managerial EBIT
on Av. AuM, bp (2)
(1) Revenues from pure Asset Management
Av.01
1Q02
Managerial
C/I Ratio
(2) Annualised data
1Q02
Revenues on Av. AuM, bp(2)
25
MOMENTUM ACQUISITION PERFECTLY
FITS PIONEER’S STRATEGY, COMPLETING
THE PRODUCT RANGE AND REINFORCING THE
DISTRIBUTION NETWORK
PIONEER brings
VALUE CREATION
 Euro 112 bn AuM
 Creating an extensive
Institutional Hedge Fund
product provider
 Euro 503 mln AuM
(Alternative Assets)
 Unified investment
process and focus on
risk management
 Strong distribution
network
 Established operating
platform to facilitate
growth
 PAI Dublin: single
strategy products
 Exploiting current growth
in Alternative Investment
products with an
established brand and
worldwide distribution
capability
 Offering a complete set of
Alternative Investment
products: Single
Strategy,Fund of Funds,
Structured Products,
Managed Accounts
 PAI Milan: multi-
 Developing long only
business in existing
Momentum locations
 Strong Operational Risk
 Cost-saving in marketing &
international distribution
network development
manager provider in the
Italian market
Management
Momentum* brings
 Euro 1.5 bn AuM as
of 31.04.2002
 Strong brand in the
FOHF market
 Strong track record in
FOHF products
 Innovative FOHF
product development
in expanding
marketplaces (e.g.
Structured products)
 Established
distribution offices in
London, Hong Kong,
Israel and Australia
(*) Total Investment: Euro 120 mln (calculated with Euro/USD FX as at 10.5.2002: 0.915), approx. 8% of Total AuMs as of Apr.02
26
Agenda
1Q2002 Group Highlights
Divisional Reporting
Italian Commercial Banking
Wholesale Banking
Investment Banking
Asset Management
New Europe Banking
Conclusions
27
OPERATING INCOME UP 23% Y/Y AND NET INCOME
GROWTH AT +19% Y/Y (+23% AND +18% AT END 1Q02
FX RESPECTIVELY)
(Euro mln)
At end of March FX
Total
Revenues
At end of period FX(1)
324
Operating
Income
+10.1%
+10.8%
359
+23.4%
+23.4%
1Q01 1Q02
Cost/Income
117 114
-2.6%
52.5%
1Q01 1Q02
+17.2%
Non Net
Interest
Income
190
154
 Customer volumes growth
constrained by slight delay in
macroeconomic pick-up and
+18.4%
by tight pricing policy:
245
 Selective Customer Loans
207
growth: +1.5% yoy(2)
(+9.6% y/y retail and
corporate average volumes)
 Customer Deposits: +2.7%
1Q01 1Q02
yoy(2) (+4% y/y retail and
corporate average volumes)
Net Interest
Income
47.1%
1Q01 1Q02
-5.4 pp
-5.7 pp
1Q01 1Q02
(1) Exchange ratio of 31 mar 02 for 1Q02, exchange ratio of 31 mar 01
for 1Q01
(2) End of period
Perimeter: Group Pekao, Bulbank and Unibanka fully consolidated,
Splitska at net equity with P&L impact of Euro 2.4 mln in 1Q01 and
Euro 4.2 mln in 1Q02 in NE dividend figure
-2.6%
 Negative impact of conservative
customer lending activity on
commissions (-4.7% y/y)
 Positive contribution of other
income (+18.2% y/y) due to fees
on current account packages
 EFFICIENT COST CONTROL
 Staff costs down 1.1% at unchanged FX (-1.158
headcount reduction vs 1Q01)
 Tight procurement, centralised purchasing, outsourcing
 Real estate restructuring
 INCREASED PRODUCTIVITY
 Total Revenues per employee up 16% at unchanged FX
from Euro 57 th. in 1Q01 to 66 th. in 1Q02
28
INCREASED CONTRIBUTION TO GROUP’S NET INCOME
FROM NEW EUROPE BANKS (+2 pp y/y), DIVISION’S C/I
AT EXCELLENT LEVEL THANKS TO RESTRUCTURING
NEW EUROPE BANKING NET INCOME – UCI’s PORTION: EURO 54 mln (+12.5% y/y)
UNIBANKA* 2%
(Euro 1 mln)
BULBANK 10%
(Euro 5 mln)
SPLITSKA 8%
(Euro 4 mln)
* Formerly Pol’nobanka
Differently from FY01
Splitska is
consolidated by net
equity method
GROUP PEKAO 80%
(Euro 43 mln)
Uni
Banka
Total
Division
15
9
359
+10
173
8
4
190
+23
ROE,%
18.6
11.1
11.4
18.4
+92 bp
C/I Ratio, %
47.5
45.1
60.7
47.1
-57 bp
Group
Pekao
Bulbank
Total Revenues, (Euro mln)
330
Operating Income, (Euro mln)
(1) Balance due to Splitska Banka, consolidated by Net Equity Method
(1)
% Ch. y/y
on Tot. (2)
(2) Calculated at Unchanged FX as at the end of March 2002
29
OVERALL ASSET QUALITY OF THE DIVISION
PRESERVED THANKS TO PEKAO’S SELECTIVE LENDING
POLICY AND EFFECTIVE RECOVERY ACTIONS
Coverage ratios
Net NPLs and Doubtful Loans as %
of Total Net Loans
9.2
9.0
78.6
54.6
2001
restated
1Q02
Net Doubtful Loans/
Total Net Loans
Net Doubtful Loans
Net NPLs
* Restated
56.8
2.8
2.5
(Euro mln)
78.6
2001
restated
Net NPLs/
Total Net Loans
Dec.
2001*
1Q’02
876
847
240
255
On Gross
Doubtful Loans
% ch.
on
Dec.’01
-3.3
+6.2
1Q02
On Gross NPLs
 Selective and conservative lending
policies (weight of net non-performing
and doubtful loans on total loans nearly
stable)
 Improvement of coverage ratios
 Implementation of new lending rules
and procedures, active monitoring
 Effective recovery actions
30
REVENUE GROWTH, RISK CONTROL AND
INCREASED EFFICIENCY TO BE SUPPORTED BY
THE IMPLEMENTATION OF NEW PROJECTS
New IT systems in Pekao and Bulbank to be completed
by 2003
“Credit Excellence Project” to improve credit process
and monitoring in all NE banks
New common platform for card processing to increase
economies of scale and to enhance competitive advantage
Divisionalisation to lead to improved commercial
effectiveness (for Pekao to be completed by June 2002)
Product enlargement (current account packages,
investment products, pension funds, life insurance, cards)
31
Agenda
1Q2002 Group Highlights
Divisional Reporting
Italian Commercial Banking
Wholesale Banking
Investment Banking
Asset Management
New Europe Banking
Conclusions
32
SUMMING UP
 Good Net Income growth on 2001 quarterly average (+10.3%), in
line with our expectations and targets
 Business diversification enhances the Group’s revenue generation
capability (+3.4% on 2001 quarterly average)
 Strong innovation capability results in high value added products
for corporate and retail customers
 Good cost control (+0.4% on 2001 quarterly average), C/I Ratio at
excellent levels (51%)
 Stable total doubtful loans with higher coverage ratios
 S3 project well on track
33
Annexes
34
1Q02 CONSOLIDATED INCOME STATEMENT
(Euro mln)
% ch. on
Avg. 01
1Q01
1Q02
% ch.
Avg.01
Net interest income (incl. dividends) 1,169
1,251
+7.0
1,218
+2.7
Net non interest income
1,288
1,286
-0.2
1,235
+4.1
2,457
2,537
+3.3
2,453
+3.4
1,242
1,295
+4.3
1,289
+0.4
1,215
1,242
+2.2
1,164
+6.7
64
64
+0.0
69
-7.6
175
178
+1.7
192
-7.3
Other net provisions*
30
20
-33.3
72
-72.2
Net extraordinary income
30
-16
n.m.
54
n.m.
Taxes
438
433
-1.1
394
+9.8
Minorities
124
130
+4.8
127
+2.6
Net income
414
401
-3.1
364
+10.3
Tax rate, %
44.9
44.9
Total revenues
Administrative costs (incl. depr.)
Operating income
Goodwill depr.
Net loan loss provisions
(*)
Including provisions to general banking risk fund
44.5
35
ASSET QUALITY BY DIVISION
(Euro mln)
Gross NPL
% change on Dec. ‘01
Dec.01(2) 1Q02
New Europe
banks
Dec.01(2) 1Q02
2,761
1,119
Italian banks
2,805
+1.6
1,192
Other
(1)
Dec.01(2) 1Q02
245
+6.5
268
Group
Dec.01(2) 1Q02
4,125
+9.4
4,265
+3.4
Gross NPL/Tot. Gr. Loans,%
2.7
2.8
10.3
11.5
1.7
1.6
3.4
3.6
Net NPL/Tot. Net Loans,%
1.5
1.6
2.5
2.8
0.6
0.6
1.6
1.6
4,309
4,363
+1.2
1,928
1,962
+1.8
457
465
1.8
6,694
6,790
+1.4
2.7
2.8
9.0
9.2
1.5
1.3
3.2
3.3
-on total gross NPL, %
46.3
46.8
78.6
78.6
64.9
62.7
56.1
56.7
-on tot. Gross doubtful
loans, %
37.8
37.9
54.6
56.8
53.4
54.0
43.7
44.5
Total gross doubtful loans
% change on Dec. ‘01
Net Doubtful Loans/Tot. Net
Loans,%
Coverage ratios
(1)
(2)
Mainly Locat, UniCredit Factoring and Parent Company
2001 restated
36
1Q02 RESULTS BREAKDOWN BY DIVISION
(Euro mln)
Italian
banking
Wholesale
banking
New
Europe
banking
New
Initiatives
Corp.
Centre &
elisions
Group
total
Interest margin (incl. div.)
990
4
245
1
11
1,251
Net non interest income
913
395
114
3
-139
1,286
1,903
399
359
4
-128
2,537
953
148
169
19
6
1,295
of which: Staff
537
83
87
3
58
768
Operating income
950
251
190
-15
-134
1,242
126
5
50
-
17
198
-
-
-
-
64
64
355
93
49
-
-64
433
-2
-
+2
-
-16
-16
Net income
467
153
93
-15
-167
531
Net income for The Group
381
146
54
-15
-165
401
Total revenues
Administrative costs
(incl. depr.)
Net provisions and
other costs
Goodwill depreciation
Tax expenses
Extraordinary Income
37
WHOLESALE BANKING DIVISION INCOME
STATEMENT
(Euro mln)
UBM
Interest margin (incl. div.)
T.Lab
ASSET
TOTAL
INVESTMENT MANAGEMENT
(Pioneer+UCI
BANKING(1)
Capital Italia)
TOTAL
WHOLESALE
BANKING (2)
19
-7
12
-8
4
197
62
258
137
395
216
55
270
129
399
39
19
57
90
148
of which: Staff
24
6
30
52
83
Operating income
177
36
213
39
251
0
0
0
0
0
70
15
86
7
93
Net income
101
21
122
31
153
Net income for The Group
101
21
122
24
146
34
21
Net non interest income
Total revenues
Administrative costs
(incl. depr.)
Extraordinary Income
Tax expenses
C/I Ratio, %
18
(1) Balance due to roundings and to Euro Capital Structures (52% owned by UBM)
69
(2) Balance due to roundings
37
38
NEW EUROPE BANKING: RESULTS BREAKDOWN
BY BANK
(Euro mln)
(UCI stake)
BULBANK
(85,2%)
UNI
BANKA
(72,4%)
TOTAL
(1)
Interest margin (incl. div.)
224
10
7
245
Net non interest income
106
5
3
114
330
15
9
359
157
7
6
169
- Staff costs
82
3
2
87
- Other costs
59
3
3
64
173
8
4
190
47
0
2
48
Net income
81
6
2
93
Net income (UCI’s portion)
43
5
1
54
ROE
18,6%
11,1%
11,4%
18,4%
Cost/income
(excl. goodwill dep.)
47,5%
45,1%
60,7%
47,1%
36%
28%
21%
34%
Total revenues
Operating costs (incl. dep.)
Net operating income
Net loan loss provisions
Tax Rate
(1)
Group
PEKAO
(53,2%)
Including Euro 4.2 mln due to Splitska Banka consolidation at net equity; balance due to roundings
39