20 MAY 2020 1 - Millennium bcp...20 MAY 2020 GENERAL MEETING OF SHAREHOLDERS 2020 5 STRONG CAPITAL Fully implemented capital ratio Requirement 13.31% Dec. 18 Dec. 19* SREP 2020** CET

20 MAY 2020

GENERAL MEETING OF SHAREHOLDERS 2020

1

AGENDA

ITEM ONETo resolve upon the management report, the individual and consolidated annual report, balance sheet and financial statements of 2019, including the Corporate Governance Report;

ITEM TWO To resolve upon the proposal for the appropriation of profit regarding the 2019 financial year;

ITEM THREE To carry out a generic appraisal of the management and supervision of the company;

ITEM FOUR To resolve on the remuneration policy of Members of Management and Supervisory Bodies;

ITEM FIVE To resolve upon the acquisition and sale of own shares and bonds;

ITEM SIX To resolve upon the election of the Board of the General Meeting for the four-year period 2020/2023.

20 MAY 20202

GENERAL MEETING OF SHAREHOLDERS BCP 2020

TO RESOLVE UPON THE INDIVIDUAL AND CONSOLIDATED ANNUAL REPORT, BALANCE SHEET AND FINANCIAL STATEMENTS OF 2019, INCLUDING THE CORPORATE GOVERNANCE REPORT

ITEM ONE

SUMMARY OF MANAGEMENT REPORT

Main highlights

Key consolidated indicators

BCP shares

Shareholders base

Competitive positioning

Strategy

Results analysis

Highlights of international operations

Balance sheet analysis

Funding and liquidity

Capital

Pension fund

Ratings

Non-financial information

Corporate governance

Compliance with the IPCG Corporate Governance Code’ recommendations

I.

II.

III.

IV.

V.

VI.

VII.

VIII.

IX.

X.

XI.

XII.

XIII.

XIV.

XV.

XVI.

3


20 MAY 2020

I. MAIN HIGHLIGHTS

NET INCOME

Million euros

302.0

20192018

301.1

+0.3%

20192018

CORE INCOME (net interest income + commissions)

Million euros

+6.9%

2,107.7

1,423.6

684.0

2,252.0

1,548.5

703.5+2.8%

+8.8%

Fees andcommissions

Net interestincome

20192018

NET INCOME BEFORE INCOME TAX

Million euros

+12.4%

627.3558.2

PT: +79.0% Int: -14.7%

IMPAIRMENT AND PROVISIONS

Million euros

541.6601.1

20192018

Loans

Other

390.2

151.4

464.6

136.5

72 b.p.92 b.p. Cost of risk

-9.9%

20 MAY 20204


IMPROVED ASSET QUALITY

Billion euros

3.2

Dec. 19Jun. 19Dec. 18

NPEPortugal

4.25.5 5.0NPEGroup

-€1.6 billion

-€1.3 billion

4.14.8

*By loan-loss reserves, expected loss gap and collaterals.NPE include loans to Customers only.

116%

58%

IMPROVED ASSET QUALITY

Dec. 19Dec. 18

52%

109%

Total coverage* Coverage by loan-loss reserves

76

72

LOWER COST OF RISK

Dec. 19Dec. 18

92

105

Cost of risk PT, b.p. Cost of risk Group, b.p.

68 b.p. excl. initial impairment Euro Bank

• Significant decrease of NPEs (-€1.3 billion from end-2018) and of cost of risk (72 b.p. in 2019); increased coverage (by loan-loss reserves and total)

I. MAIN HIGHLIGHTS

20 MAY 2020


5

STRONG CAPITAL

Fully implemented capital ratioRequirement

13.31%

SREP 2020**Dec. 19*Dec. 18

CET 19.81%12.0%

-€1.0 bn

13.5%

12.2%

15.6%

*Including unaudited earnings for 2019. | **Minimum phased-in prudential requirements from January 1, 2020, as communicated to the market on December 17, 2019.

74.0

51.0

125.1

81.7

54.7

136.4

INCREASING BUSINESS VOLUMES

Consolidated, billion euros

Dec. 19Dec. 18

+9.1%

+11.0%

45.5 50.5

Total Customersfunds***

Loans to Customers(gross)

Total businessvolume

Performingloans

***Deposits, debt securities, assets under management, assets placedwith Customers and insurance products (savings and investments).

• Capital ratio of 15.6%*, comfortably above SREP requirements. Organic capital generation and AT1+T2 issues (Jan.19 and Sep.19, respectively) more than compensate for the negative impacts of Euro Bank’s acquisition and related to the pension fund

• Increasing business volumes, with performing loans up by €5.0 billion and total Customers funds up by €7.7 billion from end-2018

I. MAIN HIGHLIGHTS

6


20 MAY 2020

2,253 2,394

1,133983

GROWING CUSTOMER BASE,MOBILE CUSTOMERS STANDING OUT‘000 Customers

Dec. 19Dec. 18

+577,000Customers

+141,000Customers

+190,000Customers

+705,000Customers

4,888+14%

+6%

+35%

+34%

5,593

1,640 2,217

Mobile Customers,Portugal

Digital Customers,Portugal

Active Customers,Portugal

Mobile Customers,Group (40%)

Active Customers,Group

560 750

I. MAIN HIGHLIGHTS

20 MAY 2020


7

MOBILE CUSTOMERS

Dec. 19Dec. 17

750

413

Dec. 18

560

‘000 Customers

+34%

I. MAIN HIGHLIGHTSMILLENNIUM APP: INCREASINGLY RELEVANT IN CUSTOMER RELATIONSHIP Annual growth rates (2018-2019)

Mobile first: a catalyst for digital growth

• Superior convenience and speed of transactions, with new navigation and expanded payment services, including Mbway

• Redesigned experience on main Customer journeys (e.g. personal credit, savings) with end-to-end transformation of processes

• Customised offer and communication with advanced analytical models

• Product innovation with native digital component (e.g. On/off insurance)

• Open banking and management of other bank’s accounts in the app

• Safety with convenience (e.g. biometrics in MbWay transactions) and privacy mode

STRONG GROWTH IN MOBILE

+61% Logins

+102% Sales

+66% Payments

+87% Transfers

47%digital Customers

31%mobile Customers

20 MAY 20208


I. MAIN HIGHLIGHTSBRINGING NEW TECHNOLOGIES TO PROCESSES AND BUSINESS MODEL, WITH A POSITIVE IMPACT ON CUSTOMER RELATIONSHIP AND ON THE BANK’S EFFICIENCY

OPEN BANKING AND NEW CUSTOMER SOLUTIONS

OPERATING EFFICIENCY

NEW SKILLS AND WAYS OF WORKING

Open banking “M Contabilidade”

More than 4,000 companies and accountants already benefit from payment integration, information collection and support to account reconciliation

Robotization and artificial intelligence for process automation at scale, with competence centre equipped with new technologies and creation of a model for industrialization

Reinforcement of internal skills: new technologies, customer experience and design, advanced analytics and AI, robotics

Focus on the development of skills: Millennium Digital Academy

Multidisciplinary teams focused on specific Customer needs; iterative agile, methodology for greater speed and scale

New service and operative model for the operations area with a strong technological component: chatbot, new process management and analytics platform, dynamic allocation of tasks to operators to optimize quality and service level

More technology at the service of Customers also at branches: account-opening with an ID card, digital mobile key and ID card to formalize processes and reinforced self-assisted machines at branches with 24x7 operation

Account aggregation

Customers can centralise information on their accounts on the Millennium bcp app, including those from other banks

20 MAY 2020


9

2. KEY CONSOLIDATED INDICATORSEuro million

2018 2019 Chan. % 19/18

BALANCE SHEET

Total assets 75,923 81,643 7.5%

Loans and advances to costumers (net) 48,123 52,275 8.6%

Total costumer funds 74,023 81,675 10.3%

PROFITABILITY AND EFFICIENCY

Return on average shareholders’ equity (ROE) 5.2% 5.1%

Cost to income excluding specific items 45.6% 47.2%

CREDIT QUALITY

Non-performing exposures / Loans to costumers 10.9% 7.7%

Cost of risk (net of recoveries) 92 b.p. 72 b.p

CAPITAL (8)

Common equity tier I fully-implemented 12.0% 12,2%

Total ratio fully implemented 13.5% 15,6%

BCP SHARE

Market capitalisation (ordinary shares) 3,469 3,065

Adjusted basic and diluted earnings per share (euros) 0.020 0.018

Market values per share (euros) (10)

High 0.3339 0.2889

Low 0.2171 0.1771

Close 0.2295 0.2028

20 MAY 202010


-30%

-20%

-10%

0%

10%

20%

30%

31 Dec.30 Nov.31 Oct.30 Sep.31 Aug.31 Jul.30 Jun.31 May.30 Apr.31 Mar.28 Feb.31 Jan.31 Dec.

BCP SHARES versus Stoxx Europe 600 Banks

1Q

2018 earningsrelease

Q1 earningsrelease

Q2 earningsrelease

+8.2%

-11.6%

2Q 3Q 4Q

31 Dec. 2018€0.2295

S&P Ugrade(Portugal)

Moody’s Upgrade (BCP)

UKelections

ECB’s monetarypolicy measures

DBRS Upgrade(BCP)

Poland’s SupCourtissued an opinion

on CHF loans

The BCP share was down 11.6% in 2019, underperforming the STOXX® Europe 600 Banks index, which was 8.2% up.Financial markets a�ected by geopolitical, macroeconomic and financial risks, with the BCP share reflecting the discount

for the litigation risk related to the CHF mortgage credit in the Polish market.

BCP exit fromSTOXX®

600Banks

Eve of ECJ’s decisionon Poland’s CHF loans

31 Dec. 2019€0.2028

Moody’s outlookdowngrade

(PT banking industry)

Source: Euronext, Thomson Reuters

Divulgação deresultados do 2T

Q3 earningsrelease

3. BCP SHARES

20 MAY 2020


11

4. DIVERSIFIED SHAREHOLDER BASE, GEOGRAPHICALLY SCATTERED

NUMBER OF SHAREHOLDERS

Dec. 19

152.2

Dec. 18

159.7

x1000

SHAREHOLDERS STRUCTURE

19%Sonangol

27%Fosun

2%EDP

27%Retail

4%PT

institucionals

21%Non-PT

institucionals

Last information available

PER GEOGRAPHY

30.5%Portugal14.9%

UK / EUA

Last information available

19.7%Africa

27.3%China

7.6%Other

20 MAY 202012


BRANCHES

PARTNERSHIP

BRANCHES OPENED ON SATURDAY

REPRESENTATIVE OFFICES

COMMERCIAL PROTOCOLS

* Includes branches of different networks that share the same physical space.* Including eurobank branches.** Not including eurobank branches.

BRANCHES WITH DIFFERENTIATED SCHEDULE

BRANCHES WITH ACESS CONDITIONS TO PEOPLE WITH REDUCED MOBILITY

Canada

Commercial protocols

EUA


Venezuela

1 Representative office

Brasil

2 Representative offices

Note: Active users are those who used Internet, Call Centre or Mobile Banking at least once in the last 90 days.1 Automated Teller Machines.2 Points of Sale.

Customers (Thousands) Internet Call Centre Mobile Banking ATM (1) POS (2)

Portugal 2,394 657,412 184,944 645,110 1,967 71,627

Poland 2,345 1,541,073 197,424 1,410,444 498 –

Switzerland 2 583 – – – –

Mozambique 854 15,817 48,801 545,847 523 7,864

Macao 3 – – – – –

5. COMPETITIVE POSITIONING

Portugal

505 Branches437118*

Poland

830* Branches80** 278**72**

Macau

1 Branch

United Kingdom


China


South Africa


Switzerland

1 Branch

3 Representative offices

1

Spain


France


Luxembourg


Mozambique

200 Branches63 15930

Angola

Partnership

20 MAY 2020


13

FRANCHISE GROWTH 2018 2019 2021 Steady State (original plan)

Active Customers 4.9 million 5.6 million >6 million

Digital Customers 55% 58% >60%

VALUE CREATION Mobile Customers 34% 40% >45%

Cost to income47%

(46% excluding non-usual costs)

50%(47% excluding

non-usual costs)≈40%

RoE 5.2% 5.1% ≈10%

CET1 12.0% 12.2% ≈12%

Loans-to-deposits 87% 86% <100%

ASSET QUALITY Dividend payout 10% ≈40%

NPE stock €5.5 billion €4.2 billion≈€3 billion

Down ≈60% from 2017

Cost of risk 92 b.p. 72 b.p. <50 b.p.

6. STRATEGY

20 MAY 202014


Million euros

2018 2019 ∆% Impacto on earnings

Net interest income 1,423.6 1,548.5 +8.8% +124.9

Commissions 684.0 703.5 +2.8% +19.5

CORE INCOME 2,107.7 2,252.0 +6.9% +144.4

Operating costs excluding non-usual items (1,000.5) (1,103.1) +10.3% (102.6)

CORE EARNINGS 1,107.2 1,148.9 +3.8% +41.7Non-usual operating costs Compensation for temporary salary custs,restructuring costs, Euro Bank intergration

(26.7) (66.4) +148.3% (39.6)

Other income* 78.9 86.4 +9.5% +7.5

OPERATING NET INCOME 1,159.3 1,168.9 +0.8% +9.6

Impairment and provisions (601.1) (541.6) -9.9% +59.5

NET INCOME BEFORE INCOME TAX 558.2 627.3 +12.4% +69.1Income taxes, non-controlling interests anddiscontinued operations (257.1) (325.3) +26.5% (68.1)

NET INCOME 301.1 302.0 +0.3% +0.9

* Includes dividends from equity instruments, other net operating income, net trading income and equity accounted earnings.

7. RESULTS ANALYSISNET EARNINGS OF €302.0 MILLION IN 2019

15


20 MAY 2020

7. RESULTS ANALYSISNET INTEREST INCOME

NET INTEREST INCOME

2019

1,548.5

2018

1,423.6

Consolidated, million euros

+8.8%

2.2% 2.2%Net interestmargin

PORTUGAL

2019

789.2

2018

803.3

Million euros

-1.8%


INTERNATIONAL OPERATIONS

2019

759.3

2018

620.3

Million euros

+22.4%


16


20 MAY 2020

7. RESULTS ANALYSISCOMMISSIONS

FEES AND COMMISSIONS

2019

703.5

2018

684.0


+2.8%

Market-related feesand commissions

Banking feesand commissions

-11.4%

+5.9%

119.3

564.7

105.6

597.8

PORTUGAL

2019

483.2

2018

475.2

Million euros

+1.7%

-19.3%

+5.0%

64.2

411.0

51.8

431.4


2019

220.3

2018

208.8

Million euros

+5.5%

-2.2%

+8.3%

53.8

166.5

55.0

153.8

17


20 MAY 2020

7. RESULTS ANALYSISOTHER INCOME

OTHER INCOME

2019

86.4

2018

78.9


+9.5%

Equity earnings+ dividends

Net tradingincome

Other operatingincome

Mandatorycontributions

89.8

78.5

43.8

143.3

-89.5 -100.7

137.9 153.3

+11.1%

PORTUGAL

2019

61.7

2018

35.1

Million euros

+75.7%


55.1

12.3

40.5

51.5

-32.3 -30.2

66.5 66.6

+0.2%

Of which:- Banking sector PT: 31.8- Resolut. fund PT: 16.0


2019

24.6

2018

43.8

Million euros

-43.7%


34.7

66.3

3.3

91.8

-57.2 -70.5

71.5 86.7

+21.3%

18


20 MAY 2020

7. RESULTS ANALYSISOPERATING COSTS

OPERATING COSTS

2019

1,169.5

2018

1,027.2


+13.8%

+10.3%

Depreciation

Recurring

Other administrativecosts

Sta� costs

376.7

57.7

592.8

376.5

124.8

668.2

1,103.11,000.5

Includes Euro Bank

Includes non-usual impactof €66.4 million:Compensation temp.salary cuts (PT): €12.4mn Restructuring costs (PT): €27.7mnEuro Bank integrationcosts (Int.): €26.3mn

Includes non-usual impact of €26.7 million (restructuring costs PT)

PORTUGAL

2019

674.3

2018

641.2

Million euros

+5.2%

+3.2%

634.2614.5Recurring


2019

495.2

2018

386.0

Million euros

+28.3%

+21.5%

468.9386.0Recurring

Includes Euro Bank

19


20 MAY 2020

7. RESULTS ANALYSISLOWER NPES AND STRENGTHENED COVERAGE

CREDIT QUALITY

Dec. 19

4,206

Dec. 18

5,547


-24.2%NPE

NPE totalcoverage*

NPE coverage by LLRs

Other

NPL>90d

2,442

3,105

1,945

2,261

116%109%

58%52%

-€1.3 billion

*By loan-loss reserves, expected loss gap and collaterals.NPE include loans to Customers only, except if otherwise indicated.

PORTUGAL

3,2464,797

Million euros

-32.3%-€1.6 billion

NPE

NPE ratio

NPE ratio (EBA)

8.8%12.9%

6.1%9.3%

Dec. 19Dec. 18

-3.2pp

-4.1pp

Down by €0,4bn in Q4’19


960750

Million euros

+27.9%+€210 million

NPE

NPE ratio

NPE ratio (EBA )

5.3%5.4%

3.4%3.3%

Dec. 19Dec. 18

+0.1pp

-0.1pp

Dec. 18 Dec. 19

NPL > 90 days ratio 6.1% 4.1%NPE ratio inc. securities and off-BS (EBA) 7.6% 5.3%

NPE ratio (loans only 10.9% 7.7%

20 MAY 202020


7. RESULTS ANALYSISCONTRIBUTION OF THE INTERNATIONAL OPERATIONS TO NET INCOME

2018 2019∆%

local currency

∆% euros

NET EARNINGS,PORTUGAL (1) 115.5 144.8 +25.4%

Poland 177.1 130.5 (26.3%) (26.8%)

Poland, comparable* 177.1 207.0 +16.9% +16.0%

Mozambique 96.4 99.5 +3.2% +5.8%

Angola** 15.5 2.5

Other 13.6 9.5

NET INCOME INTERNATIONAL OPERATIONS 302.6 242.0

Non-controlling int. (Polandand Mozambique) (120.5) (98.3)

Exchange rate effect 4.8

CONTRIBUTION FROMINTERNATIONAL OP. (2) 186.9 143.8 (23.1)

Discontinued operations (3) (1.3) 13.4

NET INCOME(CONSOLIDATED) (4)= (1+2+3)

301.1 302.0 +0.3%

*Excludes one-offs in 2019: Euro Bank integration costs and initial impairments, reversal of provision for taxes, impact of the revaluation of PSP shares and provisions for legal risks for mortgage loans in CHF. | ** Contribution of the operation in Angola. | The net results of the subsidiaries reflect for 2018 the same exchange rate considered for 2019, in order to allow comparability of the information without the exchange effect.

PORTUGAL

144.8

115.5

Million euros

+25.4%

20192018


143.8186.9

Million euros

-23.1%

20192018

20 MAY 2020


21

• Net earnings of €130.5 million, with ROE of 6.4%*

• Net operating revenue up by 27.3%, driven by net interest income; operating costs impacted by a higher contribution to the resolution fund, by increased staff and integrations costs (Euro Bank) and by higher IT costs.

• Business volumes impacted by Euro Bank’s acquisition: Customer funds up by 20.8%, while loans to Customers increased by 42.3%, excluding FX-denominated mortgage loans.

• CET1 ratio of 16.9% as of December 31, 2019, with total capital of 20.1%.

• Bank Millennium was considered best bank in Poland by Global Finance. This magazine also voted its website as the best website design in Central and Eastern Europe. Bank Millennium is also the most recommended bank and leader in Customer satisfaction in Poland (according to the survey “Customer satisfaction monitor of retail banks ARC Rynek i Opinia”).

NET INCOME

20192018

130.5177.1

Million euros

-26.3%

9.6% 6.4%*ROE

Impact ofone-o�s*:€76.4 million

+16.9% excludingone-o�s*

Excludes FX e�ect. € / Zloty rates constant to December 2019: IncomeStatement 4.30; Balance 4.25. | * ROE excluding one-o�s: 10.2%.One-o�s: Euro Bank initial integration costs and impairments, reversalof provision for taxes, impact of the revaluation of PSP shares andprovisions for legal risks for mortgage loans in CHF.

CUSTOMER FUNDS

Dec. 19Dec. 18

21,23717,574

(Million euros)

-20.8%

LOAND TO CUSTOMERS (gross)

Dec. 19Dec. 18

16,887

12,828

Million euros

+31.6%

+42.3% excluding Fx mortgage loans

8. HIGHLIGHTS OF INTERNATIONAL OPERATIONS – POLANDNET INCOME AFFECTED BY EURO BANK’S ACQUISITION

20 MAY 202022


8. HIGHLIGHTS OF INTERNATIONAL OPERATIONS – POLANDWELL SUCCEEDED INTEGRATION OF EURO BANK, IN ALL FRONTS

• Customers: significant expansion of the Customer base

• Operating model: combining traditional and franchise approach

• Geographical reach: extended branch network covers additional 200 towns in Poland

• Digital: significant potential for growing digital sales and for reinforcing cross-selling

• Companies: potential for scaling-up micro companies business to new markets

• Costs related to the integration totalled €47.7 million in 2019 (€38.6 million net of taxes)

• Integration costs estimates were revised downwards to a total of €70 million (initial estimate of €81 million)

• Integration costs of €19 million expected in 2020, with synergies in excess of €23 million projected for the same year

Million euros

Q1’19 Q2’19 Q3’19 Q4’19 Total

Euro Band integration costs - 0.4 -4.1 -10.3 -12.2 -27.1

Additional impairment Euro Bank 0.0 -18.8 -1.9 0.0 -20.6

TOTAL IMPACT, PRE-TAX -0.4 -22.9 -12.2 -12.2 -47.7

TOTAL IMPACT, NET OF TAXES -0.4 -18.6 -9.9 -9.8 -38.6

AGREEMENT CLOSING LEGAL MERGER OPERATIONAL MERGER

5 November 2018 31 May 2019 1 October 2019 11 November 2019

• One owner• Two legal entities • Two brands• Two systems

• One owner• Two legal entities• Two brands • Two systems

• One owner • Two legal entities • Two brands• Two systems

EURO BANK INTEGRATION COSTS

WELL SUCCEEDED INTEGRATION OF EURO BANK, IN ALL FRONTS

20 MAY 2020


23

8. HIGHLIGHTS OF INTERNATIONAL OPERATIONS – POLANDFX MORTGAGE LOANS LEGAL RISK

• 2,010 loan agreements of Bank Millennium under individual litigation as at the end of 2019.

• 19 cases resolved in 2nd instance courts, the vast majority of which (≈90%) in favour of Bank Millennium.

• Bank Millennium has appealed non-favourable court decisions: there were no final unfavourable court decisions up to now.

• A class action involving 3,281 loan agreements was filed at the end of 2014.

• Public advertising campaigns to encourage claims against banks may lead to an increase in the number of court disputes.

• Bank Millennium has created a PLN 223 million (€51.9 million) provision for legal risks connected with FX mortgage loans in Q4’2019.

• Bank Millennium has specific additional capital requirements related to FX mortgage risks: at the end of 2019, such requirements amounted to 4.95pp, equivalent to PLN 1.85 billion (€435 million).

FX MORTGAGE LITIGATION

PROVISIONS AND CAPITAL FOR LEGAL RISK

20 MAY 202024


• Net earnings of €99.5 million, with ROE of 20.3%

• Customer funds grew 6.6%, with loan portfolio down by 11.1% reflecting a conservative approach under a challenging environment

• Capital ratio of 45.8%

• Best bank in Mozambique by Global Finance, for the 10th year in a row, and Bank f the Year 2019, by The Banker

NET INCOME

20192018

99.596.4

Million euros

+3.2%

22.2% 20.3%ROE

CUSTOMER FUNDS

Dec. 19Dec. 18

1,6851,580

Million euros

+6.6%

Excludes FX e�ect. € / Metical rates constant to December 2019: Income Statement 69.94; Balance 70.08.

LOANS TO CUSTOMERS (GROSS)

Dec. 19Dec. 18

717807

Million euros

-11.1%

8. HIGHLIGHTS OF INTERNATIONAL OPERATIONS – MOZAMBIQUESTABLE EARNINGS, REFLECTING THE NORMALISATION OF THE INTEREST RATE ENVIRONMENT

20 MAY 2020


25

*Deposits, debt securities, assets under management, assets placedwith Customers and insurance products (savings and investments).

TOTAL CUSTOMERS FUNDS*

81.774.0


+10.2

Individuals: +12.9%

Dec. 19Dec. 18

17.4

1.3

24.7

30.6

19.1

1.8

23.8

37.1

O�-BS funds

Other BS funds

Term deposits

Demand deposits

TOTAL CUSTOMERS FUNDS* PORTUGAL

56.853.3

Billion euros

+6.6%

Individuals: +8.5%

Dec. 19Dec. 18

14.41.2

18.2

19.5

15.81.6

16.7

22.7

TOTAL CUSTOMERS FUNDS* INTERNATIONAL OPERATIONS

24,920.8

Billion euros +20.0%

Dec. 19Dec. 18

3.10.1

6.5

11.1

3.30.1

7.1

14.3

9. BALANCE SHEET ANALYSISCUSTOMER FUNDS KEEP GROWING

26


20 MAY 2020

9. BALANCE SHEET ANALYSISINCREASING LOAN PORTFOLIO

LOANS TO CUSTOMERS (GROSS)

Dec. 19Dec. 18

54.751.0


+7.2%

NPE: -24.2% (-€1.3 billion)Performing: +11.1% (+€5.0 billion)

NPE include loans to Customers only.

4.0

23.2

23.8

6.0

22.8

25.9Mortgage

Personal and other

Companies

PORTUGAL

Dec. 19Dec. 18 NPE Performing

36.737.2

Billion euros

-€0.5 billion

-1.55 +1.08

-1.3%


Dec. 19Dec. 18 NPE Performing

18.013.8

Billion euros

+30.1%

+€4.2 billion

+0.21 +3.95

27


20 MAY 2020

LOANS TO DEPOSITS RATIO

Dec. 19Dec. 18

86%87%

ECB FUNDING

Dec. 19Dec. 18

0.3

2.7

16.9% 17.1%

Billion euros

-€2.4 billion

Eligible assets

-89.3%

LIQUIDITY RATIOS (CRD/CRR)

LCR (Liquiditycoverage ratio)

NSFR (Net stablefunding ratio)

216%

135%

100%

10. FUNDING AND LIQUIDITY

20 MAY 202028


CAPITAL RATIO

Fully implemented

13.31%

SREP 2020*

15.6%

13.5%

Dec. 19*Dec. 18

*Including unaudited earnings for 2019.**Minimum phased-in prudential requirements from January 1, 2020, as communicated to the market on December 17, 2019.

+€1.0bn

9.81%12.2%12.0%

Requirement

Total

CET1

11. CAPITAL

CET1 capital ratio of 12.2%* (fully implemented) as of December 31, 2019

Increase from 12.0% as of December 31, 2018 reflects capacity to generate capital organically, more than compensating for the negative impacts of Euro Bank’s acquisition and related to the pension fund

Total capital ratio of 15.6%* (fully implemented) as of December 31, 2019, boosted by the AT1 issue completed in January 31, 2019, and by the T2 issue completed in September 20, 2019, and comfortably above SREP requirements

20 MAY 2020


29

12. PENSION FUND

Dec. 18 Jun. 19 Dec. 19

Pension liabilities 3,066 3,319 3,490

Pension fund 3,078 3,174 3,501

Liabilities coverage 100% 96% 100%

Funds profitability +0.2% +4.7% +8.1%

Dec. 18 Jun. 19 Dec. 19

Discount rate 2.10% 1.60% 1.40%

Salary growth rate0.25% until 2019 0.25% until 2019

0.75%0.75% after 2019 0.75% after 2019

Pensions growth rate0.00% until 2019 0.00% until 2019

0.50%0.50% after 2019 0.50% after 2019

Projected rate of return of fund as 2.10% 1.60% 1.40%

MORTALITY TABLES

Men Tv 88/90 Tv 88/90 Tv 88/90

Women TV 88/90-3 years TV 88/90-3 years TV 88/90-3 years

• Discount rate and projected rate of return revised downwards to 1.40%, mainly reflecting lower market rates

• Fully-covered (100%) liabilities

PENSION FUND

31%Deposits at

banks and other

7%Real estate

50%Bonds

12%Shares

20 MAY 202030


13. RATINGS

31 Dec.2018

1 Apr.

RATING UPGRADES IN 2019 RECOGNISE MILLENNIUM BCP’S IMPROVED PROFITABILITY,ASSET QUALITY AND BUSINESS MODEL

3 Jun. 24 Jul. 10 Oct. 30 Oct. 31 Dec.2019

Upgrade ofsenior debt

rating

Upgrade of senior debt

rating toinvestment

grade

Upgrade of depositsrating to

investment gradeand of senior debt

rating

Positiveoutlook

Positiveoutlook

Moody’s DBRS Moody’s S&P

Fitch

Ba2 Seniordebt

rating BBB (low) Ba1 BB

BB

20 MAY 2020


31

14. NON-FINANCIAL INFORMATIONCOMMITMENT TO PEOPLE AND SOCIETY

Influence the Bank’s long-term value proposition, in balance with the well-being of people, the company and communities, respecting natural resources, climate and the environment.

The new Sustainability Master Plan 2021 will guide the implementation of ESG (Environmental, Social and Governance) policies and practices, in three areas of operation:

Environmental

Implementation of measures that foster the fair and inclusive transition to a de-carbonised economic development model, including the incorporation of the environmental issue into the Bank’s risk models.

Undertake actions for various Stakeholder groups aimed at contributing to the economic and social development of the countries where we are present.

CULTURE OF SOCIAL RESPONSIBILITY DIMENSIONS OF MILLENNIUM BCP INTERVENTION

COMMITMENT TO CREATE SOCIAL VALUE

Social

Involvement with the external and the internal communities.

Governance

Integration of sustainability principles into the Bank’s decision-making processes.

20 MAY 202032


14. NON-FINANCIAL INFORMATIONMAIN INITIATIVES

SUSTAINABILITY COMMITMENTS MILLENNIUM BCP FOUNDATION

“Millennium Festival ao Largo” bringing free-for-all classical music shows to the streets

Subscription of the Charter of Commitment to Sustainable Financing in Portugal

Restoration of the Panels of St. Vincent, of the National Museum of Ancient Art (2020-2022)

Restoration of the D. João IV Room, at the National Palace of Ajuda

Renovation of a wing of the National Museum of Contemporary Art to hold temporary exhibitions based on the Bank’s and the Museum’s collection

Archaeological Centre of Rua dos Correeiros: renovation of museography, a project by Atelier Bruckner. Re-opening scheduled for June 2020

Money Lab : financial literacy program for young students

Signing of the Lisbon Business Mobility Pact and of the Compromisso Lisboa Capital Verde Europeia 2020, for climate action

Signing of 22 agreements for cooperation, entrepreneurship and promotion of microcredit

Support to the Portuguese Food Bank to fight hunger, involving several employees of the Bank as voluntaries

Millennium bcp has published its first Plan for gender-equality, including several actions and practices to foster diversity and inclusion

Reconstruction of the “3rd of February” elementary school, in Mozambique, with funds raised through a Millennium bim campaign

The 5th edition of Bank Millennium’s “Financial ABC” financial literacy program in Poland trained >10,000 students

Inclusion in the Bloomberg 2020 Gender-Equality Index, together with a group of 325 global companies that stand out in the implementation of gender equality policies

20 MAY 2020


33

14. NON-FINANCIAL INFORMATIONAWARDS IN 2019

AWARDS IN 2019

Millennium bcp: Leadership in the “PMEExcelência ’18” and “PME Líder ’18” programmes,with the largest number of submissions and awardsamong participating banks

Millennium bcp: Closest to Customers; leaderin Customer global satisfaction, in qualityservice, in satisfaction with products andservices; most recommended bank(Basef Banca, Dec. 2019)

Millennium bcp: Market leader in factoring,confirming and leasing, according to thePortuguese association of leasing, factoringand renting companies

Millennium bcp: Marketeer award, “Banking”category (3rd year in a row)

Millennium bcp: Best investment bank, em Portugal

Millennium bcp: Best investment bankin Portugal

ActivoBank: 5 estrelas 2020” award,“Digital Banking” category

ActivoBank: “Right Choice” by Deco Proteste,“personal loans above 5,000 euros” category

ActivoBank: Best commercial bank,Best consumer digital Bank and Best mobilebanking app in Portugal

Bank Millennium: Best bank in Poland

Bank Millennium: Best trade finance providerin Poland

Millennium bim: Bank of the year in Mozambique

Bank Millennium: Best website design in Centraland Eastern Europe

Bank Millennium: Most recommended bank and leaderin Customer satisfaction (“Customer satisfactionmonitor of retail banks ARC Rynek i Opinia”)

Millennium bim: Best bank in Mozambique(10th year in a row)

Millennium bim: Best Information Security andFraud Management in Mozambique

Millennium bim: Best trade finance providerin Mozambique

Millennium bim: Global Finance Innovators 2019 award,“Payments” category, for the “Millennium IZI” service

Millennium bcp: Best consumer digitalbank in Portugal;Best Information Securityand Fraud Managementin Portugal

Millennium bcp: Main bank forcompanies; mostappropriate products;most innovating;closest to Customers

Millennium bcp: Best private bankin Portugal

ActivoBank : Consumer choice2020, “Digital Banks”category

20 MAY 202034


15. CORPORATE GOVERNANCEONE-TIER MANAGEMENT AND SUPERVISORY MODEL, COMPOSED BY A BOARD OF DIRECTORS

- Pensions Funds Risk Monitoring - Quality, Security and Data Protection - Compliance and Operational Risks- Sustainability

- Costs and Investments - Costs and Investments Sub-Commission- Corporate, Investment Banking and Institutional Banking- Human Resources- Retail- Compliance and Operational Risks

ONE-TIER MANAGEMENT AND SUPERVISORY MODEL, COMPOSED BY A BOARD OF DIRECTORS

General Meeting of Shareholders

Executive Committee

Commissions and Sub-Commissions

Remuneration and Welfare Board

Board for International Strategy Client Ombudsman

Company Secretary

Board of Directors

Audit CommitteeStatutory Auditor (ROC)

- Committee for Nominations and Remunerations - Committee for Corporate Governance, Ethics and Professional Conduct - Committee for Risk Assessment

- Project Mobilizar- Credit- CALCO- Risk - Validation and Monitoring of Models Sub-Commission- Monitoring NPA (non-performing assets)

20 MAY 2020


35

16. COMPLIANCE WITH THE IPCG CORPORATE GOVERNANCE CODE’ RECOMMENDATIONS

RECOMMENDATIONS OF CORPORATE GOVERNANCE CODE OF IPCG - INSTITUTO PORTUGUÊS DE CORPORATE GOVERNANCE

Nr. of Recommendations Compliance

RECOMMENDATION DESCRIPTIONCHAPTER I - GENERAL PART

I.1. Investor Relations and Information 1 Match: 1

I.2. Diversity in the composition and functioning of corporate bodies 5 Match: 5

I.3. Relation between ocorporate bodies 2 Match: 2

I.4. Conflicts of Interest 2 Match: 2

I.5. Transactions with related parties 2 Match: 2

CHAPTER II - SHAREHOLDERS AND GENERAL MEETING 6 Match: 3No match but justifies: 3

CHAPTER III - NON-EXECUTIVE MANAGMENT AND SUPERVISION 12Match: 9

Non applicable: 2No match but justifies: 1

CHAPTER IV - EXECUTIVE MANAGEMENT 4 Match: 4

CHAPTER V - PERFORMANCE, REMUNERATION AND NOMINATIONSV.1. Annual Performance Evaluation 2 Match: 2

V.2. Remunerations 6 Match: 6

V.3. Remuneration of Directors 5 Match: 4 Non applicable: 1

V.4. Nominations 4 Match: 4

CHAPTER VI - RISK MANAGEMENT 3 Match: 3

CHAPTER VII - FINANCIAL INFORMATION VII.1. Financial Information 1 Match: 1

VII.2. Statutory audit of Accounts and supervision 5 Match: 4 Non applicable: 1

20 MAY 202036


TO RESOLVE UPON THE PROPOSAL FOR THE APPROPRIATION OF PROFIT - 2019

ITEM 2

TAKING INTO CONSIDERATION:

A. The provisos of the law and of the by-laws concerning the legal reserve;B. The dividend policy of Banco Comercial Português (BCP);C. The alteration introduced in the Work Collective Agreement, published on 29 March 2014 on the no Bulletin of Work and

Employment no. 12 which enabled the Employees of Group Banco Comercial Português in Portugal, in the period comprised between June 2014 and June 2017, to accept a temporary reduction in their remuneration. This reduction was done with the purpose of rendering the Bank’s recovery process feasible and contribute for the compliance with the requirements imposed to the Bank to be able to benefit from State Aid;

D. That the said alteration to the Work Collective Agreement provided that the Board of Directors, in the years following the end of the state intervention, having results for such, would submit to the General Meeting of Shareholders a proposal for the distribution of results to Employees that, over the years, would allow the delivery of an accumulated total amount, at least equal to the total amount not received by Employees during the temporary reduction of the remuneration period;

E. That BCP ended the repayment of the public financing received, plus interest, in February 2017, and the Annual General Meeting held on May 22, 2019 approved the allocation of part of the 2018 results for distribution to employees;

F. That, according to the financial statements to be submitted to the approval of the Shareholders, in the 2019 financial year Banco Comercial Português recorded consolidated net earnings amounting to € 302,003,469.31 and individual net earnings amounting to € 139,296,016.59;

G. That the approval of any compensation for the Employees against the income statement, as well as the estimation of the respective amount pertains exclusively to the General Meeting of Shareholders, and the Executive Committee (by delegation of the Board of Directors), after getting the opinion from the Committee for Nominations and Remunerations, establishes the distribution criteria,

H. That reiterating its intention to respect the Bank’s dividend policy and, even considering that BCP has already joined the group of institutions without specific limitations regarding dividend distribution, the Board of Directors cannot fail to consider the potential impacts and uncertainties associated with the current pandemic situation;

I. That such situation recommends the utmost caution in the making of the proposal for the appropriation of income, a caution also recommended by the supervisory authorities, justifying the non-payment of dividends concerning the 2019 financial year,

The Board of Directors, reaffirming its determination to, once this crisis is over, and in the extent that the Bank and the domestic economy can initiate their recovery, resume the full application of the approved Dividends Policy, hereby

20 MAY 2020


37

PROPOSES:

IIn accordance with article 66 (5) (f) and for purposes of article 376 (1) (b) of the Companies Code, as well as article 54 of the Bank’s articles of association, the following application of net individual year-end results amounting to € 139.296.016,59, euros:

a. For the reinforcement of legal reserve, € 13.929.601,66;

b. For an extraordinary distribution to employees and, in compliance with the mentioned in paragraphs C to G of the recitals of this proposal, up to € 1.000,00 to each employee who hasn’t already been fully compensated with the earnings distributed in 2019 if he/she remain in his/her position on the date the remuneration corresponding to June 2020 is paid, up to a maximum total amount of € 5.281.000,00;

c. The remaining, in the minimum amount of € 120.085.414,93, to Retained Earnings.

Lisbon, 26 March 2020

THE BOARD OF DIRECTORS

20 MAY 202038


TO CARRY OUT A GENERIC APPRAISAL OF THE MANAGEMENT AND SUPERVISION OF THE COMPANY

ITEM 3


• The diligence, dedication and professionalism evidenced during the 2019 financial year by each and every one of the members of the Board of Directors in the exercise of their functions, namely by the members of the Executive Committee and of the Audit Committee, showing commitment in the defence of Clients, Employees, Shareholders and remaining Stakeholders;

• The high professionalism and quality of the work developed by the Statutory Auditor and by its representative, recognized by the Bank’s Audit Committee;

• The Evaluation Report from the Bank’s Committee for Nominations and Remunerations.

IT IS PROPOSED:

That the General Meeting, within the scope of the general appraisal of the company’s management and supervision, resolve to approve a vote of trust and praise addressed to the Board of Directors, including to the Executive Committee and to the Audit Committee and to each of their members, as well as to the Chartered Accountant and its representative.

Lisbon, 23 April 2020

Chiado (Luxembourg) S.à.r.l Sonangol - Sociedade Nacional de Combustíveis de Angola, E.P.-

Fundo de Pensões do Grupo EDP

20 MAY 2020


39

BOARD OF DIRECTORS - EVALUATION REPORTITEM 3

The Committee for Nominations and Remunerations (CNR),within the scope of the competences granted to it by the Legal Framework of Credit Institutions and by its own Regulations makes, at least once a year, a report wherein it assesses the good repute, the knowledge, the competences, the practical and theoretical experience, the professional qualification, the independence, the incompatibilities, the availability and minimum and specific requirements for the exercise of the position by each one of the members of the management and supervisory body, including the executive directors.

While performing the competence mentioned above, the Committee for Nominations and Remunerations, with the support from the advising company Ernst & Young that provides, on this matter, the provision of specialized and independent services, promoted the assessment of each one of the members of the Board of Directors, in terms of evaluation of activity, performance and recognition of the continued effort and excellence revealed by the members of the Board of Directors while in the performance of their functions, namely at the executive and supervisory level.

In the evaluation process and apart from its direct evaluation, the CNR took under consideration the filling in by each one of the Directors of a self-assessment questionnaire targeted at assessing compliance with legal requirements for the exercise of the functions, namely good repute, knowledge, experience and availability.

With the support provided by Ernst & Young and the report made by the latter, the information collected, complemented with the collective evaluation matrix, annex II to the Instruction from Banco de Portugal 23/2018, the CNR evaluated each one of the members of the management and supervisory bodies and also carried out a collective appraisal of that corporate body.

We must underline that, for that purpose, the executive and non-executive members of the Board of Directors were interviewed in person by the external advisers so that the qualitative and quantitative approach be weighted in the individual and collective assessment of the Board of Directors and of each one of its Committees, including the Audit Committee and the Executive Committee, taking into account the following: • The respective composition, organization and functioning;• The performance of the respective activity;• The relations established amongst its members;• The relations established with other players, namely with the Group’s structure; • The evaluation of the making of focused decisions;

20 MAY 202040


• The evaluation of independence for the exercise of the position;• The guarantee of capacity to perceive risks and make decisions;• Drive towards institutional growth;• The collective aptitude;• Acting with loyalty and weighing up of the interests of the company and of all its stakeholders;• The existence of a strategic, independent, transparent and proper vision;• The existence of fairness and respect for procedural guaranties;• Interaction with supervision.

Based on its own knowledge and experience and on the report made by Ernst & Young, the Committee for Nominations and Remunerations, at its meeting held on 16 April 2020, jointly debated and reflected on the criteria mentioned above, which were established in line with best corporate governance practices, regarding both the individual evaluation process of each one of the members of the Board of Directors and the one of the Board of Directors as a collective body and concluded that they all recorded a performance of excellence, focused namely, on:• Organization and competences; • Institutional reputation in relevant markets;• Availability and initiatives;

To conclude, the Committee resolved to, unanimously, approve this Report on the evaluation of the activity and performance of the executive and non-executive members of the Board of Directors during the 2019 financial year and convey its positive opinion on the issue of a vote of trust and praise addressed to the Board of Directors, including to the Executive Committee and to the Audit Committee and to each one of their members.


Teófilo da Fonseca José Elias da Costa

20 MAY 2020


41

RESOLVE UPON THE REMUNERATION POLICY OF MEMBERS OF THE MANAGEMENT AND SUPERVISION BODIES

ITEM 4

In accordance with the law and the articles of association of Banco Comercial Português, S.A. the Remuneration and Welfare Board (RWB) and the Committee for Nomination and Remunerations (CNR) are responsible for presenting for approval by the general meeting of shareholders a proposal on the Remuneration Policy of the members of the management and supervision bodies.

During 2019 and first quarter of 2020, the CNR, analysed the above-mentioned Remuneration Policy with the purpose of improving it and ensure compliance with the domestic and EU legislation, as well as with the guidelines issued by the different Supervisors.

Consequently, it entirely revised the Policy for the Remuneration of members of the Management and Supervisory Bodies and the new version was approved by the RWB and by the Bank’s Board of Directors.

In addition, the RWB, within the scope of its competences, and in compliance with its supervisory duties, verified the compliance of the payments made to the members of the corporate bodies, which it did based on an audit carried out by an independent company, different from the Bank’s audit.

Thus, and in compliance with article 14 of the Bank’s articles of association, the RWB and the CNR propose the approval of the following Remuneration Policy of Members of the Management and Supervisory Bodies, as stated in the attached document.


REMUNERATIONS AND WELFARE BOARDCOMMITTEE FOR NOMINATIONS AND REMUNERATIONS

42


20 MAY 2020

ANNEX ITEM 4

REMUNERATION POLICY OF MEMBERS OF THE MANAGEMENT AND SUPERVISORY BODIES

BASIC PRINCIPLESThis Remuneration Policy applies to the members of the management and supervisory bodies (MMSB) of Banco Comercial Português, S.A. (“BCP” or “Bank”) was made in compliance with the provisions of the Group Regulations GR0042 on remuneration policies and is based on a number of principles that aim to ensure:

a. A governance model able of promoting the alignment of the interests of all stakeholders, namely in what concerns the sustainability of short, medium and long terms earnings and a prudent management of risk;

b. a competitive fixed remuneration enabling to attract and retain competent professionals and a variable remuneration intended to stimulate individual and collective performance, as well as reward the results achieved, in line with the current and future bank’s risk appetite;

c. the attribution of benefits, namely in what concerns the retirement complement, aligned with market practices;

d. the compliance with the applicable regulations and guidelines in terms of procedures and remuneration policy.

e. Behaviours and commercial practices in line with the interests and needs of the Group’s Customers.

For that purpose, it pertains to the Committee for Nominations and Remunerations (CNR), the definition and annual revision

of the principles defining the remuneration policy of the MMSB and submit such policy, for approval, at the General Meeting of Shareholders of the Bank.

It is the responsibility of the Committee for Risk Assessment (CRA) to examine if the incentives established in the Bank’s policy for the remuneration of MMSB take into consideration the risk, capital, liquidity and expectations concerning income at any given time.

Whenever the CNR does not have, at least, a member of the Committee for Risk Assessment in its composition, the latter must indicate a representative to participate in the meetings of the CNR having the remuneration issue on the Agenda.

To prepare the proposal for the Remuneration Policy and supervision of its implementation, the CNR must consult the RWB and get contributions and support from different areas of the BCP, especially from the following ones:

a. The Risk area, an area which should be involved to ensure that limits are not exceeded in terms of risk, total equity, and liquidity of the institution, contributing for the definition of the measures for implementing the variable remuneration based on risk, namely ex ante and

43


20 MAY 2020

ex post measures and verify if the variable remuneration structure is in line with the Group’s risk profile and culture;

b. The Human Resources Division, which should contribute to the preparation and evaluation of the Policy for the Remuneration of Employees, namely regarding the structure and levels of remuneration and estimation of the amounts of AVR to attribute, taking into account strategic and budgetary goals, employee profile, retention strategies and market conditions.

c. The Compliance area, which must analyse in what extent the principles and practices of the Remuneration Policy may affect the Group BCP’s capacity to comply with legislation, regulations, rulings, internal requirements and the respect for the company’s culture, reporting to the RWB and to CNR any anomalous situation which may prove able of jeopardizing or compromise that compliance;

d. The Internal Audit Division, which must develop annual independent mechanisms for the validation /revision of the design of the Remuneration Policy and also for its implementation, calculation and respective effects.

In the independent analysis for the implementation of the Remuneration Policy, the CNR, with the support from the Internal Audit, will verify the implementation and compliance with the remuneration policies and procedures adopted and will communicate its conclusions to the RWB.

While preparing the proposal for the Remuneration Policy, the RWB must also follow clear and transparent procedures, which

are documented; the documents regarding the making of the proposal and making of decisions must be kept by means of minutes of meetings, reports and other relevant documents.

The CNR may hire independent and qualified experts and external consultants for support, to assist one or more of its members in the performance of its functions and that contribute and support the performance of its duties.

It is considered essential that the fixed remuneration represents a sufficiently high portion of the total remuneration so as to ensure the adequate balance between the fixed and variable components of the total remuneration.

The variable remuneration is in line with the strategy defined for the Bank and with the Bank’s objectives, values and long-term interests. This way, the Bank guarantees a sustainable performance, adjusted to its risk profile.

In accordance with these principles, the attribution of a variable remuneration is linked with the performance and on the sustainable growth of the Bank’s income and adequacy of its capital ratios, as well as on the market conditions and on the possible risks, able of affecting the business. This way, the Bank is able to guarantee a model that is financially sustainable and does not jeopardizes the institution, its depositors, employees, shareholders and remaining stakeholders.

The remuneration earned by the Director responsible for Risk and Compliance translates the need to guarantee a greater independence versus the Bank’s performance; therefore

44


20 MAY 2020

the Bank must privilege qualitative indicators as well as quantitative indicators related with the compliance with the behavioural and prudential rules in the calculation of the variable remuneration.

Are also foreseen reduction (malus) and reversion (clawback) mechanisms, in the whole or only in a portion of the variable remuneration in order to be able to comply with the legal and regulatory requirements and also observe the recommendations and guidelines issued by the competent entities. The ability to totally or partially reduce (malus) the payment of a deferred remuneration, the payment of which is not yet an acquired right, as well as to, partially or totally retain the payment of a variable remuneration, the payment of which is an acquired right, (claw-back), is limited to extremely significant events, duly identified and wherein the individuals involved had a direct participation.

The application of the claw-back mechanism must be supplementary to the reduction (malus) mechanism, i.e. in case of occurrence of an extremely significant event, the application of the reduction mechanism (malus) shall be a priority and only when the latter is deemed used up and insufficient or other criteria for the application of this mechanism are in effect, resulting from the applicable legal framework and EBA guidelines, should one consider using this mechanism.

ARTICLE 1(OBJECT)This Policy establishes the rules for the attribution of the annual fixed remuneration, of the annual variable remuneration, long term variable remuneration and other benefits able of being attributed to the members of the corporate bodies of the Company, including the Retirement Regime.

ARTICLE 2(DEFINITIONS)The following expressions and acronyms, when capitalized, shall have the following meaning:i. BCP, Bank or Company – Banco Comercial Português, S.A.ii. CEO – Chairperson of the Executive Committeeiii. CNR – Committee for Nominations and Remunerationsiv. CRO – Chief Risk Officerv. RWB - The Remuneration and Welfare Boardvi. Autonomous Document – Document stating, in the first part,

the specific amounts of the remuneration of the different members of the corporate bodies approved by the RWB, and in the second part, the calculation formulas, indicators or indexes to use in the calculations, being the latter approved by means of a joint resolution issued by CNR and RWB.

vii. Group or Group BCP – includes the Company and all the companies in a control or group relationship with the Company, Millenniumbcp Prestação de Serviços ACE, Fundação Millenniumbcp and Clube Millenniumbcp.

viii. AVR Evaluation Period – period of time from 1 January to 31 December, respectively of 2018, 2019, 2020 and 2021.

ix. LTVR Evaluation Period – period of time from 1 January 2018 until 31 December 2021.

45


20 MAY 2020

x. AVR Attribution Price – corresponds to the average of closing prices of the shares of the Company recorded during the two months prior to the beginning of each AVR evaluation period.

xi. LTVR Attribution Price – corresponds to the average of closing prices of the shares of the Company recorded during the two months prior to the beginning of each LTVR evaluation period.

xii. PSI20 – Portuguese stock index – PSI20 Index composed of the companies chosen at each moment by the competent bodies of Euronext Lisbon – Sociedade Gestora de Mercados Regulamentados, S.A.

xiii. Retirement Supplement – the Retirement Supplement regime due to old age or disability to be paid by the company, foreseen in article 17 of the Company’s articles of association.

xiv. AFR – annual fixed remunerationxv. AVR – annual variable remunerationxvi. Target AVR – Annual variable remuneration corresponding

to 100% compliance with the quantitative and qualitative objectives mentioned in the applicable annexes.

xvii. LTVR - long-term variable remunerationxviii. Target LTVR - Long-term variable remuneration

corresponding to 100% compliance with the objectives mentioned in the applicable annexes

xix. Stoxx Europe 600 Banks Index (SX7P) – Index of shares composed by large European Banks

xx. TSR – total shareholder return , estimated by means of the following equation the data of which are obtained through an independent and recognized market information platform (ex: Bloomberg or Reuters):

[(Average of the closing prices of the shares for the two months prior to the end of the evaluation period – Average of the closing prices of the shares for the two months prior to the beginning of the evaluation period) + Dividends per share paid to the shareholders in that period] / Average of the closing prices of the shares for the two months prior to the beginning of the evaluation period, adjusting stock prices to reflect the effects of share capital increases, incorporation of reserves or similar transactions. The dividends to consider are those that, in relation to the date of approval, have been more recently approved.

xxi. Member - Member of the Executive Committeexxii. VC - Vice-Chairperson of the Executive Committee

CHAPTER IMembers of the Company’s Corporate Bodies

ARTICLE 3(ANNUAL FIXED REMUNERATION, VARIABLE REMUNERATION AND BENEFITS)1. The establishment of the remunerations and benefits of

the Members of the Corporate Bodies is made by the RWB and, since they are defined for the term-of-office may, for situations recognized as exceptional, be revised by the RWB in the course of the same.

2. The members of the Executive Committee and the non-executive Directors exercising functions under an exclusive regime, are also entitled to the benefits foreseen in article 12.

46


20 MAY 2020

CHAPTER IIMembers of the Board of the General Meeting

ARTICLE 4(ANNUAL FIXED REMUNERATION)1. The members of the Board of the General Meeting of the

Company are entitled to an annual fixed remuneration established by the RWB, paid in four quarterly payments and to corporate bodies health insurances subscribed by the bank and at each moment in effect.

2. The remuneration set forth in 1. at any given moment is mentioned in the Autonomous Document.

CHAPTER IIINon-Executive Members of the Board of Directors

ARTICLE 5(ANNUAL FIXED REMUNERATION)1. The non-executive members of the Board of Directors of

the Company are entitled to an annual fixed remuneration divided into 12 monthly payments and to the health insurance subscribed by the Bank at each moment for its Employees and Executive Directors.

2. The remuneration set forth in 1. at any given moment is mentioned in the Autonomous Document.

3. The RWB may, pursuant to a request made by the Director, resolve not to attribute remuneration to non-executive member(s) of the Board of Directors who is/are related with shareholders holders of a qualified stake.

CHAPTER IVExecutive Members of the Board of Directors

ARTICLE 6(ANNUAL FIXED REMUNERATION)1. The members of the Executive Committee are entitled to a

annual fixed remuneration paid in 14 monthly instalments, described in the Autonomous Document.

2. The retirement pension supplement due to old age and disability mentioned in article 13 does not have a discretionary nature; therefore it is a fixed remuneration.

ARTICLE 7(VARIABLE REMUNERATION)1. The members of the Executive Committee may also earn a

variable remuneration composed by a component attributed by the RWB by reference to the financial year to which it concerns (AVR) and by a long-term component (LTVR) attributed by reference to the entire term-of-office.

2. The attribution and establishment of the AVR and of the LTVR pertains to the RWB and depends on the favourable opinion issued by the CNR, on the compliance with the rules herein established and on the compliance with the remaining requirements of the Autonomous Document.

3. The variable remuneration, both the annual and long-term components, may not be attributed under exceptional conditions, namely if, after an opinion issued by the Audit Committee, the Committee for Risk Assessment, it is found that: (i) there is not a strong base of own funds; (ii) its attribution could unduly limit the Company’s ability to strengthen its own capital or (iii) the attribution of the same

47


20 MAY 2020

does not observe the applicable legislation, regulations and guidelines.

4. The addition of the components of the annual and pluri-annual variable remuneration of the several directors due in each year, cannot exceed, in its whole, 2the amount set forth in the Bank’s articles of Association.

5. The attribution of the variable remuneration is subject to the positive performance of own funds under a prudential perspective (value of capital for purposes of the estimation of the CET1 of the Group), and may, by decision made by the RWB after listening to the CNR and the Committee for Risk Assessment, not be considered extraordinary operations that, for their size and/or impact, affect the capital.

6. No guaranteed variable remuneration shall be granted, except when hiring a new executive director and only in the first year of activity and it will only be granted by the RWB if, pursuant to an opinion from the Audit Committee and the Committee for Risk Assessment, the institution has a solid and strong capital base.

7. Only for purposes of estimating the attributable variable remuneration, the amounts corresponding to the pension supplementary regimes are not considered AFR.

8. The variable component of the remuneration is associated with the performance. Therefore, its total value may vary from zero, if the degree of accomplishment of the goals is under the defined threshold, and a maximum that can, in each year and in compliance with the conditions established in this document and with the law, exceed twice the AFR.

9. The AVR will be paid 50% in cash and 50% in BCP shares in the deferred portion and in the non-deferred portion.

10. Except if expressly requested by the beneficiary Director, the

number of shares to deliver in compliance with the provisions of the previous paragraph will be the one corresponding to the amount to pay in shares, net of income tax.

11. Each beneficiary cannot, in any case whatsoever, receive a variable remuneration that, after the number of shares is converted (evaluated at the attribution price) reach a total exceeding 200% the respective AFR, either in an year when there is only AVR or in years when there are AVR and LTVR.

12. Whenever the variable remuneration, calculated in accordance with the previous number, exceeds the component of the value of the AFR, the amount exceeding the AFR shall only be due in the extent that the same is inferior to 200% of the respective AFR and can only be paid after being approved by the General Meeting of Shareholders (in accordance with the provisions of article 115-F of the Legal Framework for Credit Institutions and Financial Companies), pursuant a proposal made by the RWB, after listening to the CNR, the Committee for Risk Assessment, the Risk Officer and the Compliance Officer.

13. The definition of the quantitative indicators is made by the CNR, after listening to the Committee for Risk Assessment and is made based on the Bank’s strategic goals, being also considered as an integral component of the process for the definition of the key-risk indicators so as to ensure an alignment of the risk profile of the executive members of the board of directors with the level of risk able of being tolerated by the Bank.

14. The variable remuneration of the CRO privileges qualitative and quantitative indicators related with the compliance with the prudential and behavioural rules, as well as the performance shown by the Bank’s risk profile.

48


20 MAY 2020

15. As foreseen in no. 15 of article 115-E of the Legal Framework for Credit Institutions and Financial Companies, no relevant hedging mechanisms may be used with the purpose of attenuating the effects of alignment with the risk inherent to the types of remuneration, and no variable remuneration can be paid by means of special purpose vehicles or other methods with an equivalent effect.

ARTICLE 8(ANNUAL VARIABLE REMUNERATION)1. The AVR considers the following values (without damaging

the provisions of article 7 (10 and 11):i. Target AVR – 42% of the respective total AFR (corresponding

to 60% of the addition of the Target AVR with the Target LTVR);

ii. Maximum AVR attributable - 63% of the respective AFR.2. The EC, after listening to the RWB, the Committee for Risk

Assessment and the Audit Committee may - through a duly grounded written document to be recorded in a minutes of meeting - apply an adjustment factor of the percentages provided for in the preceding paragraph, with a minimum of - 25% and a maximum of +25%, namely to cover possible risks, current and future ones, cost of own funds and of liquidity required by the BCP Group, as well as to translate exceptional performances by the Bank.

3. When the adjustment factor implies a positive or negative variation equal or greater than 12.5%t, that is, 50%, of the one indicated in no. 2 above, it will have to be justified in writing.

4. The computation of the AVR amount is based on the results of the performance evaluation throughout the AVR

Evaluation Period in question and results from the sum of two autonomous and independent components:i. 80% of the amount is based on the evaluation of the level of

compliance with the quantitative objectives (corporate KPIs);ii. 20% of the amount is based on the evaluation of

performance of each director regarding the qualitative objectives.

5. The corporate KPIs are established, each year, by the CNR, after listening to the RWB, based on the Business Plan or Budget for the respective period, previously approved by the Board of Directors, which will be part of the Autonomous Document.

6. The KPIs mentioned in the preceding paragraph should be in line with the goals of the activity plan and take into account the risk appetite defined by the Bank and the capital and liquidity plans, being defined KPIs for the global performance of the Bank and differentiated KPIs for each director, adjusted to his/her areas of responsibility.

7. The values of the corporate KPIs defined for each year will be mentioned in the Autonomous Document.

8. The calculation of the amounts of the AVR shall be made by the Bank’s Division in charge of Planning and Management Control and shall be audited by the Internal Audit Division and, pursuant to a resolution adopted by the RWB, those estimations may be validated by an external independent entity.

9. The attribution of the AVR depends on the performance recorded for each corporate KPI, being calculated as follows (without damaging the provisions of article 7 (10 and 11):i. If the performance recorded falls under 80% of the

established KPI, no AVR shall be attributed for that quantitative objective;

49


20 MAY 2020

ii. If the performance recorded is between 80% and 90% of the KPI established, shall be attributed the amount placed in the interval 70% and 80% of the target AVR of that objective as per the Autonomous Document;

iii. If the performance recorded is between 90% and 110%, the KPI established, shall be attributed the amount placed in the interval 80% and 120% of the target AVR of that objective, as per the Autonomous Document;

iv. If the performance recorded is between 110% and 150%, the KPI established, shall be attributed the amount placed in the interval 120% and 150% of the AVR target of that objective, as per the Autonomous Document;

v. If the performance recorded attains 150% of the objective or more, shall be attributed the amount corresponding to 150% of the AVR ta target of that objective, as per the Autonomous Document;

10. The attribution of the AVR corresponds to the performance regarding the corporate KPIs of BCP, defined for each director, as mentioned in the Autonomous Document and is dependent on the verification of a weighted average equal to or greater than 80% of KPIs defined concerning the Bank’s global performance.

11. The AVR attributed to each executive member due to the corporate KPIs, results from the following equation: percentage of the target AVR based on the performance in accordance with the provisos of number 8 x 80%.

12. The qualitative evaluation of the members of the Executive Committee will pertain to the CNR, after listening to the non-executive Chairperson and Vice-Chairpersons of the Board of Directors and the Chairperson of the Executive Committee, who will only issue an opinion concerning the remaining members of the Executive Committee.

13. The annual weighted evaluation of the qualitative objectives will be able of being measured and estimated in accordance with a table/questionnaire approved by the CNR, after listening to the RWB, the Compliance Officer and the person in charge of Human Resources.

14. The global performance of the qualitative objectives is a result of the weighted average of the objectives mentioned in the Autonomous Document (rounded to the unit), with the weight mentioned in number 3 ii) of this article and in accordance with the following parameters:i. If the global performance recorded is lower than level 2

(“Somewhat Lower than Expected”), no excess regarding the AVR will be estimated, as such;

ii. If the performance recorded is between level 2 (“Lower than Expected”) and level 3 (“Meets the Expectations”), shall be attributed the amount placed in the interval 60% and 100% of the target AVR for that objective, as per the Autonomous Document;

iii. If the performance recorded is between level 3 (“Meets the Expectations”) and level 4 (“Above Expectations”), shall be attributed the amount placed in the interval 100% and 130% of the target AVR for that objective, as per the Autonomous Document;

15. The non-deferred component of the AVR is paid in the month following the date of approval of the Earnings by the Annual General Meeting of Shareholders (“AVR Payment Date”).

16. Without damaging the provisions of article 7 (10 and 11), the AVR shall be deferred in 40% throughout a five-year period being paid a fifth each year, on the AVR Payment Date, being the payment made 50% in cash and 50% in

50


20 MAY 2020

Company shares in the deferred component and in the non-deferred part. If the AVR equals or exceeds two thirds of the AFR of each member, 60% of that amount must be paid in a deferred manner.

17. The number of shares to attribute to each executive director results from the the quotient between the value of the AVR, estimated after the assessment of the performance and the “Price of attribution of the AVR”.

18. The shares of the Company attributed as AVR, in accordance with 16 above, are subject to a retention policy for a period of one year commencing on the AVR Payment Date; therefore, the executive director will not be able to sell them, except for the provisos of the following number, during the 12 months following their delivery.

19. The executive director may sell or encumber the shares in the amount necessary to cover the totality of taxes and contributions to pay due to the attribution of the shares. As an alternative, the director will be able to choose the “sell-to-cover” regime, through which the number of shares that will be delivered to him/her will already be deducted from the number of shares which must be sold in order to pay taxes and contributions corresponding to the total value of the shares attributed.

20. If the member of the Executive Committee is not elected for a new term-of-office, the unavailability regime foreseen in article 17 above will continue to be in effect .

21. If the member of the Executive Committee leaves office, for any reason other than removal with just cause, after the end of the evaluation period but before the payment of the AVR, the AVR corresponding to that evaluation period will be paid in full, corresponding to that evaluation period, in compliance with the deferment periods and composition (cash or shares).

22. The payment of the AVR corresponding to the evaluation period during which the termination of functions of the member of the Executive Committee occurs, shall not be due, except in situations of termination of functions by agreement, retirement, death, disability or any other cause for the cessation of the term of office due to a cause not imputable to the Executive Director, namely the alteration of the control of the Company, among other, following a takeover bid or other fact outside the Executive’s Director will, in which case there will be a proposal for a pro rata temporis attribution of AVR, after a resolution adopted by the RWB after listening to the CNR - being that the maximum amount of the indemnity must take into account the average of the AVR of the last 3 years or of a lesser number of years in case the director was in office for a period of time inferior to 3 years.

23. In case a new non-executive director initiate his/her functions in the middle of the term, he/she will be entitled to a “po-rata temporis” of the AVR and of the LTVR.

ARTICLE 9(LONG-TERM VARIABLE REMUNERATION)1. The long-term variable remuneration (LTVR) is exclusively

paid by means of the attribution of shares of the Company taking into consideration the following benchmark values (“Target”) and maximum limits (without damaging the provisions of article 7 (10 and 11):i. Target LTVR – 28% of the respective total AFR (corresponding to

40% of the addition of the Target AVR with the Target LTVR);ii. Maximum value of LTVR – 42% of the respective AFR of

the LTVR evaluation period.

51


20 MAY 2020

2. The EC, after listening to the RWB, the Committee for Risk Assessment and the Audit Committee may apply an adjustment factor of the percentages provided for in the preceding paragraph, with a minimum of -25% and a maximum of +25%, namely to cover possible risks, current and future ones, cost of own funds and of liquidity required by the BCP Group, as well as to translate exceptional performances by the Bank.

3. When the adjustment factor implies a positive or negative variation equal or greater than 12.5%t, that is, 50%, of the one indicated in no. 2 above, it will have to be justified in writing.

4. The estimation of the number of shares corresponding to the LTVR to attribute is based on the results of the performance evaluation made during the LTVR evaluation period, being assessed in accordance with the Autonomous Document.

5. The attribution of LTVR regarding the performance foreseen in the previous paragraph depends on the degree of compliance with the objectives as of 31 December 2021 set forth in the Autonomous Document.

6. The performance evaluation components are of a quantitative nature and are established by the CNR, after listening to the RWB, being described in the Autonomous Document.

7. In case there is an operation altering the perimeter of BCP with relevant impact and the Board of Directors approves the alteration of the objectives of the Strategic Plan, the evaluation components must be revised accordingly by the CNR, after obteining the opinion from the RWB.

8. The LTVR should be paid in the month following the date of approval of the financial statements by the General Meeting

of Shareholders (“LTVR Payment Date”), by attributing shares of the Company in accordance with the terms and conditions foreseen in the Policy.

9. Without damaging the provisions of article 7 (10 and 11), the LTVR shall be deferred in 40% throughout a 3-year period and paid on the LTVR Payment Date, a third each year. If the LTVR, in relation to each member, is equal or above two thirds of the AFRs due in the LTVR evaluation period, the amount deferred will correspond to 60%.

10. The number of shares to attribute to each executive director results from the the quotient between the value of the LTVR, estimated after the assessment of the performance and the Price of attribution of the LTVR.

11. The payment of the LTVR requires the full exercise of the term-of-office for which the executive director was appointed, except in situations of termination of functions by agreement, retirement, death, disability or any other cause for an early cessation of the term of office due to a cause not imputable to the Executive Director, namely the alteration of the control of the Company, among other, following a takeover bid, in which case there will be a pro rata temporis attribution of LTRV, after a resolution adopted by the RWB, after listening to the CNR, at the end of the Plan’s term.

12. If the member of the Executive Committee leaves office, for any reason other than removal with just cause, after the end of the evaluation period but before the payment of the LTVR, the same will be paid in full, corresponding to that evaluation period, in compliance with the deferment periods and composition (cash or shares) foreseen in the applicable regulations.

52


20 MAY 2020

13. The shares of the Company attributed as LTVR are subject to a retention policy for a period of one year commencing from the date the LTVR is paid so that during the 12 months following their delivery, the director is unable to sell them, except in the cases mentioned in the following number.

14. The executive director may sell or encumber the shares in the amount necessary to cover the totality of taxes and contributions to pay due to the attribution of the shares. As an alternative, the director will be able to choose the “sell-to-cover” regime, through which the number of shares that will be delivered to him/her will already be deducted from the number of shares which must be sold in order to pay taxes and contributions corresponding to the total value of the shares attributed.

15. If the member of the Executive Committee is not elected for a new term-of-office, the unavailability regime foreseen in article 13 above will continue to be in effect .

16. Notwithstanding the provisions of article 9, the computation of the final amount of the LTVR will consider the amount of the AVR and the limitations foreseen in article 7 (10 and 11).

ARTICLE 10(TERMINATION OF FUNCTIONS BEFORE THE END OF THE TERM-OF-OFFICE)1. The Director who terminates functions before the end of the

term-of office for reasons other than due to renunciation or dismissal with just cause, will be entitled to a compensation to be estimated by the CNR and resolved by the RWB, after listening to the Committee for Risk Assessment.

2. The compensation to attribute in compliance with the provisions of the previous paragraph cannot be qualified as

a fixed remuneration and its payment must be subject to the signing of a non-competition commitment for a period of time corresponding to the end of the term-of-office under way on the date of the removal.

3. The amounts to be attributed in compliance with the provisions of number one cannot exceed the global fixed remuneration that would be due until the end of the term-of-office plus, in the case of non-executive directors, of an amount corresponding to the average of the AVR attributed to him/her during the years he/she was in office in the term-of-office when he/she ceased to exercise functions.

ARTICLE 11(MALUS AND CLAWBACK CLAUSES)1. The entire variable remuneration, regardless of the

establishment, or not, of acquired rights, is subject to reduction or reversion mechanisms whenever it is proven that the Executive Director participated in or was responsible for a performance that resulted into significant losses for the Group or ceased to comply with the suitability and good repute criteria until the date of the last payment of the variable remuneration in the case of the reduction mechanism and up to 3 years after payment of the deferred remuneration in the case of the reversion mechanism.

2. The ability to totally or partially reduce (malus) the payment of a deferred remuneration, the payment of which is not yet an acquired right, as well as the refund of variable remuneration, paid or whose payment already constitutes an acquired right, (claw-back), is limited

53


20 MAY 2020

to significant events, duly identified and wherein the individuals involved had, with malicious intent or gross negligence, an active participation.

3. The reduction or reversion of the variable remuneration should always be related with the performance or the risk and should respond to the effective results of risks or alterations in the continuing risks faced by the Group, the Bank or by the areas of the responsibility of the executive director in question and should not be based on the amount of dividends paid or on the shares price performance.

4. The application of the claw-back mechanism must be supplementary to the reduction (malus) mechanism, i.e. in case of occurrence of a significant event, the application of the reduction mechanism (malus) shall be a priority and only when the latter is deemed used up, is insufficient, or while it is assessed if the Director significantly contributed for the negative financial performance of the Group and also in case of fraud or offences with malicious intent or serious negligence which caused significant losses, should one consider using the reversion mechanism (claw-back).

5. In any circumstance and concerning the application of malus or claw-back mechanisms, the guidelines from EBA (European Banking Authority) that are in effect at the time will always have to be observed and complied with.

6. The occurrence of the situations described in this article is supervised by the CNR and the application of those mechanisms shall be made after a consultation made to the RWB, the Committee for Risk Assessment, the Audit Committee and the Chairperson of the Board of Directors.

ARTICLE 12(BENEFITS)The members of the Executive Committee and the non-executive directors exercising functions under an exclusive regime, are entitled to the following benefits:i. Health insurance, credit card and mobile phone, in line with

what is attributed to the remaining bank employees.ii. Retirement Supplement.

ARTICLE 13(SUPPLEMENTAL RETIREMENT PENSION FOR DISABILITY AND OLD AGE)1. The directors shall benefit from the social security regime

applicable in each case.2. The directors are also entitled to a Retirement Supplement

formed by capitalization insurance contracts of which each director will be the beneficiary.

3. Pursuant to an agreement established with each director, the capitalization insurance contract may be replaced by contributions to pension funds with a defined contribution.

4. The amount of the contributions of the Bank, within the scope of the two previous paragraphs, shall be established on a yearly basis by RWB, after hearing to the CNR’s opinion.

5. The Bank’s annual contribution for the plan set forth in the previous paragraph is equal to the value, before applying any income tax deductions for individuals, corresponding to 20% of the annual gross fixed remuneration defined at any given time by the RWB.

6. The Bank shall not bear any additional expenses with the retirement and disability pensions after the termination of each director’s functions.

54


20 MAY 2020

7. The right to the supplement shall only become effective if the beneficiary retires due to old age or disability, under the terms of the social security regime applicable to him/her.

8. At the time of the retirement, the beneficiary may choose to redeem the capital if and to the extent that the contract underlying the alternative chosen by him/her, so allows.

9. In case of death before retirement, the right to receive the accrued capital shall remain effective pursuant to the applicable provisions established by the contract or by law.

ARTICLE 14(PENSION DISCRETIONARY BENEFITS)It is not envisaged the attribution of pension discretionary benefits, based on the Bank’s performance or on the individual performance or on any other factors with a discretionary nature. However, the General Meeting of Shareholders may approve the attribution of an extraordinary contribution in accordance with article 13 (6) above.

ARTICLE 15(REMUNERATION EARNED DUE TO THE

PERFORMANCE OF OTHER FUNCTIONS RELATED WITH BCP)1. Considering that the remuneration of the executive members

of the Board of Directors, as well as the one of the non-executive directors exercising functions under an exclusive regime is intended to directly compensate the activities they carry out directly at the Bank or in related companies (namely companies in a control or group relation with BCP) or in corporate bodies to which they have been appointed by indication or in representation of the Bank, the net value of the remunerations received annually for such duties by each member of the Board of Directors exercising functions under an exclusive regime will be deducted from their respective AFR.

2. It is the obligation and responsibility of each member of the Board of Directors to inform the Bank of any additional compensation they may have received, for the purposes of complying with the procedure established above.

ARTICLE 16INSURANCE1. The Directors must subscribe to a director bond in abidance

by article 396 of the Companies Code. 2. In addition, the Bank subscribes to a Directors & Officers

insurance policy following market practices.

55


20 MAY 2020

TO RESOLVE UPON THE ACQUISITION AND SALE OF OWN SHARES AND BONDSITEM 5


• Considering the general regime applicable to commercial companies with respect to the acquisition and sale of own shares and bonds;

• Considering the convenience for Banco Comercial Português, S.A. (the Bank) of being able to continue to make use, under the general terms, of the possibilities that are inherent to such operations;

• Considering that the same convenience exists also in respect of current and/or future subsidiaries, which, as happened before, may even be bound, under the terms of issue of their own securities, to acquire or sell shares of the Bank, for which, without prejudice to article 319 (3) of the Companies Code, it is equally convenient to provide;

• The characteristics of the bonds that may be issued by the Bank or subsidiary companies, in particular those connected with the issuance of convertible or exchangeable securities by the Bank or subsidiary companies,

• The provisions in articles 319 and 320 of the Companies Code and in the regulations issued by Comissão do Mercado de Valores Mobiliários;

• That the Delegated Regulation of the Commission (EU) 2016/1052, of 8 March, establishing a special regime containing, specific exemption requirements from the general regime of market abuse for certain share buyback programmes, requirements which it would be convenient to take into account, even if the buybacks are out of the scope of the programmes included therein;

• The Remuneration policies applicable to the Executive Directors and Employees of the Group who are Key-functions holders, in line with best practices require that the Bank acquires own shares to pay the Annual and Long-Term Variable Remuneration,

56


20 MAY 2020

WE PROPOSE:

1. The approval of the acquisition by the Bank, or any of its current or future subsidiaries, of own shares or bonds (in the latter, in any of the situations when the approval is legally required) already issued, or to be issued, of any kind, including rights to their acquisition or attribution, subject to a decision of the administration body of the acquiring company, under the following terms:

a. Maximum number of shares to acquire: up to the limit corresponding to ten per cent of the share capital, after deduction of any disposals made pursuant to the exercise of the authorization foreseen in 2) of this resolution without prejudice of the exceptions permitted by law and the amount of shares that may be needed to fulfil any obligation of the acquirer, arising from law, an issue of securities or other financial instruments or other obligation, including within the context of the implementation of the policy for the remuneration of members of the corporate bodies and/or other employees of the Group and subject, if applicable, to subsequent disposal, as established by law, of shares that exceed the said limit; Maximum number of bonds to acquire: corresponding to the total of each issue, up to the limit corresponding to ten per cent of the aggregated nominal value of the totality of the bonds issued, regardless of the issue they concern, after deduction of any disposals and/or repayments made, without prejudice of the exceptions permitted by law and the amount needed to fulfil any obligation of the acquirer, arising from law, an issue of financial instruments or other binding obligation;

b. Term during which the acquisition may be made: eighteen months counting from the date of this resolution;c. Forms of acquisition:

of shares: subject to the terms and limits imperatively established by law, namely in compliance with the principle of equality of the shareholders in the terms established by law, onerous acquisition of any kind, namely by purchase or exchange to be made in or outside a regulated market from entities designated by the competent management body of the acquirer, according to criteria wherein the eventual quality of shareholder is not a relevant factor, or acquisition at any title for, or by virtue of, fulfilment of an obligation arising from law, of issuance, conversion or exchange of securities or other financial instruments, or other contractual obligation, including within the context of the implementation of the policy for the remuneration of members of the corporate bodies and/or other employees of the Group, in accordance with the respective legal or binding conditions; of bonds: acquisition of any kind, namely original acquisition or onerous secondary acquisition in a regulated market or out of a regulated market, whether or not carried out through financial dealers, besides the cases of conversion of convertible bonds;

57


20 MAY 2020

d. Minimum and maximum consideration for the acquisitions: of shares: the price of an onerous acquisition must be contained in an interval of fifteen per cent less or more vis-à-vis respectively the lowest and the average trading price of the shares traded on Euronext Lisbon, during the week immediately preceding the acquisition In the case of acquisition connected with, or in satisfaction of contractual conditions, namely of issuance of securities or other financial instruments, or of contract related with such issue, the price will be the one resulting from the terms of such issuance or contract, if such is foreseen;of bonds: the price of an onerous secondary acquisition must be contained within a fifteen per cent interval up or down vis-à-vis the average price of the bonds in the stock exchange where the acquisition is made, during the week immediately preceding the acquisition or correspond to the acquisition price pursuant to the law or contract, namely acquisition through accord and satisfaction agreement, when the acquisition derives from it;In case of an issue not listed in a regulated market, the interval shall refer to the value computed based on the bond prices of other financial institutions in the same rating class, with similar term, and, for issues with interest rate structures or derivatives included, bearing in mind the value of those structures or derivatives, estimated by the method usually used by market operators, if it allows an objective computation, or by means of an independent valuation, if not.In the case of acquisition connected with, or in satisfaction of contractual conditions, namely of issuance of other securities, or of contract related with such issue, the price will be the one resulting from the terms of such issuance or contract, if such is foreseen;

e. Time of acquisition: to be determined by the management body of the acquiring company, taking into consideration the situation of the market and the interests or obligations of the acquirer, the Bank or of any subsidiary company of the Bank, and being carried out in one or more times in the proportions to be established by the said body.

2. To approve, except in the cases of conversion or redemption and subject to the specific authority of the competent administration body, the sale of own shares or bonds that have been acquired, including rights to their acquisition or attribution, subject to a decision made by the competent management body of the seller company, under the following terms:

a. Minimum number of shares or bonds to sell: the correspondent to the quantity enough for the fulfilment of an obligation undertaken, arising from law, contract, issuance of securities or other financial instruments or resolution adopted by the competent management body;

58


20 MAY 2020

b. Term during which the acquisition may be made: eighteen months counting from the date of this resolution;c. Form of sale: subject to the terms and limits imperatively established by law, namely in compliance with the principle of

equality of the shareholders in the terms established by law, onerous sale of any kind, namely by purchase or exchange to be made in or outside a regulated market to entities designated by the competent management body of the seller, according to criteria wherein the eventual quality of shareholder is not a relevant factor, or sale at any title, when resolved by the competent management body, without damaging that, when the sale is made for fulfilment of an obligation assumed or arising from law, of issue, conversion or exchange of securities or other financial instruments or other binding obligation, including within the context of the implementation of the policy for the remuneration of members of the corporate bodies and/or other employees of the Group, the same is to be made in accordance with the respective legal or binding conditions;

d. Minimum sale price: of shares: no more than fifteen per cent below the average trading price on Euronext Lisbon of the shares sold during the week immediately preceding the sale, or other price that is determined or results from the terms and conditions pursuant to the law or contract (and, namely, from the issue of other securities, in particular convertible or exchangeable securities, or of contract entered into relating to such issue, conversion or exchange or yet within the context of the implementation of the policy for the remuneration of members of the corporate bodies and/or other employees of the Group), when the sale derives from them; of bonds: no more than fifteen per cent below the lowest prices referred to in sub-paragraph d) of nr. 1 of this resolution (in the portion regarding bonds), in accordance with the applicable situation, or price determined in connection with the issue terms and conditions of other securities, namely convertible securities, or in accordance with contract related with such programme, issuance or conversion, or yet within the context of the implementation of the policy for the remuneration of corporate bodies and/or other employees of the Group) whenever such sale is made in connection with or in execution of the respective terms;

59


20 MAY 2020

e. Time of the sale: to be determined by the competent management body of the selling company, taking into consideration the conditions of the securities market and the convenience or obligations of the seller company, of the Bank or of other subsidiary of the Bank, and being carried out in one or more times in such proportions to be established by that management body.

3. That, as to the rest, the sale and acquisition transactions mentioned above are to be made in full compliance with the remaining applicable rules and, whenever applicable and the competent management body so deems possible and appropriate, in compliance with the requirements of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 and of the Delegated Regulation (EU) 2016/1052 of the Commission of 8 March 2016, setting forth the requirements and conditions that trading in own shares transactions must observe to benefit from the exemptions from the prohibitions on market abuse.


THE BOARD OF DIRECTORS

60


20 MAY 2020

TO RESOLVE UPON THE ELECTION OF THE BOARD OF THE GENERAL MEETING FOR THE FOUR-YEAR PERIOD 2020/2023

ITEM 6


1. That the term of office of the members of the Board of the General Meeting has reached its end;2. The unquestionable quality shown by the members who are leaving office in the performance of their functions which is

also recognized in the assessment made by an external advisor, which was validated by the Committee for Nominations and Remunerations of the Bank in a report made for that specific purpose;

3. That the members who are leaving office only performed functions in one term-of-office, beginning in 2017 and, consequently, will maintain their qualification as Independent if they are re-appointed for the exercise of the position,

The signatories jointly present the proposal for the re-appointment of the elected members of the Board of the General Meeting of Shareholders of Banco Comercial Português, S.A., for the four-year term of office 2020/2023:

Chairman: Pedro Rebelo de SousaVice-Chairman: Octávio Castelo Paulo

The curricula that, under the law, should be made available to the Shareholders, together with the report from the Committee for Nominations and Remunerations of the Bank are hereto attached.


Chiado (Luxembourg) S.à.r.l Sonangol - Sociedade Nacional de Combustíveis de Angola, E.P.-

Fundo de Pensões do Grupo EDP

61


20 MAY 2020

REPORT ON THE EVALUATION MADE OF THE MEMBERS OF THE BOARD OF THE GENERAL MEETING

ITEM 6

Teófilo da Fonseca José Elias da Costa

Considering that the elected members of the Board of the General Meeting of Shareholders of Banco Comercial Português ended their first term-of-office on 31 December 2019, the Committee for Nominations and Remunerations (CNR), within the scope of its competences for evaluating the different members of the Bank’s corporate bodies, with support from the advising company Ernst & Young that provides independent and specialized services on this matter, proceeded, aiming to issue an opinion on their eventual re-appointment, with the evaluation of the elected members of the Board of the General Meeting of Shareholders, analysing, regarding each one, the compliance with legal requirements of suitability for the exercise of the functions, namely good repute, knowledge, experience, availability and independence.Accordingly, and based on its own knowledge and experience concerning the performance by the current elected members of the Board of the General Meeting of Shareholders who, in the term-of-office ended on 31 December 2019, recorded a performance of excellence, especially focused on:• Organization and competences; • Availability and initiatives;• Defence of the Shareholder’s interests;• Independence

The Committee for Nominations and Remunerations unanimously resolved to convey its favourable position regarding the re-appointment for the four-year term-of-office 2020/2023 of the following individuals:• Pedro Miguel Duarte Rebelo de Sousa, as Chairman of the Board• Octávio Manuel de Castro Castelo Paulo, as Vice-Chairman of the Board


20 MAY 202062


ANNEXITEM 6

PEDRO MIGUEL DUARTE REBELO DE SOUSA

PERSONAL DATA • Date of Birth: 29 April 1955 • Nationality: Portuguese• Position: Chairman of the Board of the General

Meeting• Appointed for the 1st time on: 10 May 2017• Current Term-of-office: 2017/2019

POSITION HELD AT THE BANK• Chairman of the Board of the General Meeting

ACADEMIC AND SPECIALISED QUALIFICATIONS • Licentiate Degree in Law from the Faculty of

Law of Universidade Clássica de Lisboa • Post-graduate degree in Commercial and

Corporate Law. – Universidade Pontifícia Católica, Brasil

• Master’s degree in Companies Management, from Fundação Getúlio Vargas – Business Administration School, São Paulo, Brazil

MANAGEMENT AND SUPERVISION POSITIONS HELD IN OTHER COMPANIES• Chairman of the Board of Auditors of Mustard Seed Maze

• Chairman of the Board of Auditors of Federação dos Advogados de Língua Portuguesa

• Chairman of the Board of Auditors of Associação dos Amigos do Hospital de Stª Maria

OTHER RELEVANT POSITIONS • Founder and senior partner of Sociedade

Rebelo de Sousa & Advogados (SRS)• Member of the Sub-Committee for Latin

America of the Atlantic Council, Washington DC

• Chairman of the Board of the General Meeting of A. Santo, SGPS (Group Santo)

• Chairman of Círculo Eça de Queiroz – an institution serving the public interest

• Chairman of the Portuguese Institute of Corporate Governance

20 MAY 2020


63

• Member of the Remunerations Commission of Novabase S.A.

• Director of the Câmara de Comércio Portugal-Holanda

• Chairman of the Board of the General Meeting of Sumolis Group Refrigor

• Chairman of the Board of the General Meeting of CTT’s (appointment at the GM held on 29/04/2020)

• Chairman of the Board of the General Meeting of COSEC (appointment at GM postponed to September 2020)

• Chairman of the Board of the General Meeting of several Institutions and Associations

NUMBER OF SHARES OF BANCO COMERCIAL PORTUGUÊS, S.A. HELD ON 31 DECEMBER 2019:• 0 (zero)

PROFESSIONAL EXPERIENCE IN THE LAST TEN YEARS RELEVANT TO THE POSITION• From 1985 to 2017 – Curator of the Câmara de

Comércio Portuguesa, São Paulo, Brasil• From 1998 to 2010 – Non-executive Director

of Intesa SanPaolo IMI International, Portugal• From 1999 to 2009 – Partner of the law firm

Simmons & Simmons, exercising the functions of Director of the firm from 2004 to 2009

• From 2004 to 2006 - Chairman of the Board of the General Meeting of PT Internacional

• From 2005 to 2006 - Chairman of the Board of the General Meeting of Galp, S.A.

• From 2005 to 2011- Chairman of the Supervisory Board of Banif Investimento, S.A

• From 2007 to 2012 – Director of the Portuguese Chamber of Commerce & Industry

• From 2009 to 2013 – Chairman of the Supervisory Board of Banco Caixa Geral Brasil. S.A.

• From 2011 to 2013 – Non-executive Director, Chairman of the Evaluation and Strategy Committee and member of the Board of Auditors of Caixa Geral de Depósitos, S.A.

• From 2012 to 2018 - Non Executive members of the Board of Directors of Cimpor – Cimentos de Portugal, SGPS, S.A.

20 MAY 202064


OCTÁVIO MANUEL DE CASTRO CASTELO PAULO

PERSONAL DATA • Date of Birth: 25 March 1964 • Nationality: Portuguese and Angolan• Position: Vice-chairperson of the General

Meeting of Shareholders• Appointed for the 1st time on: 10 May 2017• Term-of-office: 2017/2019

POSITION HELD AT THE BANK• Vice-chairperson of the General Meeting

of Shareholders

ACADEMIC AND SPECIALISED QUALIFICATIONS • Licentiate Degree in Law from Universidade

Lusíada de Lisboa

MANAGEMENT AND SUPERVISION POSITIONS HELD IN OTHER COMPANIES• He is the partner at SRS Advogados

responsible for the Corporate & Finance Department (M&A, Corporate, Commercial and Finance), a department that also includes the TMT (Telecommunications, Media and Technology) and Immigration practice areas.

• Chairperson of the Board of Directors (non-executive) of Standard Bank de Angola, exercising the position of Chairperson of the Audit and Risk Committees.

OTHER RELEVANT POSITIONS • Chairperson of the Board of the General

Meeting of companies under Portuguese and Angolan law and has also been a member of the Board of Auditors of several companies.

• He regularly provides advisory services to companies for capital markets and mergers and acquisitions

ANNEXITEM 6

20 MAY 2020


65

NUMBER OF SHARES OF BANCO COMERCIAL PORTUGUÊS, S.A. HELD ON 31 DECEMBER 2019:• 8.127

PROFESSIONAL EXPERIENCE IN THE LAST TEN YEARS RELEVANT TO THE POSITION• Since 1993, he has been practising law and

is also registered with the Law Society of England as a qualified lawyer practising law since 2010, he is registered with the Angolan Bar Association

• From 2003 to 2009 – partner of the international law firm Simmons & Simmons, headquartered in London

• From 2009 to 2011 – Chairman of the Portuguese Institute of Corporate Governance

• He is a member of the ICC – International Chamber of Commerce

• Coordinated operations for the privatisation of state-owned companies, to be listed in the Stock Exchanges of Lisbon, London and New York

• He is an advisor to several companies, open to public investment, or not, in matters of Corporate Governance, area in which he is a specialist

• He collaborates with financial institutions in Angola, particularly in regulatory matters, namely those relating to compliance and risk.

• Chairperson of the Board of Auditors of several companies under Portuguese and Angolan law

• He is author and co-author of several works in the areas of Commercial Law and Company Law and of several works in the area of Telecommunications Law

Investor Relations DivisionBernardo Colaço, Responsável EquityLuís Pedro MonteiroTl: +351 211 131 084

Debt and RatingsLuís MoraisTl: +351 211 131 337

E-mail: [email protected]

Banco Comercial Português, S.A., a public company (Sociedade Aberta) having its registered office at Praça D. João I, 28, Oporto, registered at the Commercial Registry of Oporto, with the single commercial and tax identification number 501 525 882 and the share capital of Eur 4,725,000.

Documents

20 MAY 2020 1 - Millennium bcp...20 MAY 2020 GENERAL MEETING OF SHAREHOLDERS 2020 5 STRONG CAPITAL Fully implemented capital ratio Requirement 13.31% Dec. 18 Dec. 19* SREP 2020** CET