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CORPORATE PRESENTATION JUNE 2018

CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

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Page 1: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

CORPORATE

PRESENTATION

JUNE 2018

Page 2: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

2

Disclaimer

This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction. Securities

may not be offered or sold in the United States unless they are registered pursuant to the US Securities Act of 1933 or are exempt

from such registration. Any public offering of securities in the United States, Canada, Australia or Japan would be made by means of a

prospectus that will contain detailed information about the company and management, including financial statements

The matters discussed in this document may include forward-looking statements that are subject to risks and uncertainties. By their

nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on

circumstances that may or may not occur in the future and may cause the actual results, performance or achievements of BCP to be

materially different from future results, performance or achievements expressed or implied by such forward looking statements. Many

of these risks and uncertainties relate to factors that are beyond BCP's ability to control or estimate precisely, such as future market

conditions, currency fluctuations, the behavior of other market participants, the actions of regulators and other factors such as BCP's

ability to continue to obtain financing to meet its liquidity needs, changes in the political, social and regulatory framework in which

BCP operates or in economic or technological trends or conditions, including inflation and consumer confidence. Attendees at this

presentation are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this

presentation. Even if BCP’s financial condition, business strategy, plans and objectives of management for future operations are

consistent with the forward-looking statements contained in this presentation, those results or developments, as well as BCP past

performance, may not be indicative of results or developments in future periods. BCP expressly disclaims any obligation or

undertaking to release any updates or revisions to these forward-looking statements, whether as a result of new information, future

events or otherwise, except as required by applicable law

The information in this presentation has been prepared under the scope of the International Financial Reporting Standards (‘IFRS’) of

BCP Group for the purposes of the preparation of the consolidated financial statements under Regulation (CE) 1606/2002

First 3 months figures for 2018 and 2017 not audited

Page 3: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

3

Agenda

Macro and Business Overview

Strategic Plan 2013-2018

3M2018 earnings

Other information

Page 4: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

4

Key highlights

• Successful fiscal consolidation in the last years in Portugal: State budget deficit at

0.9%* in 2017, with a surplus forecasted for as early as 2021.

• Following the 2011-2013 recession, economic activity is now strong, with GDP up by

2.7% in 2017 from 1.6% in 2016

• Unemployment decreased significantly from its peak, and now stands at 7.9% (8.9%

full year 2017 figures)

• The current account has turned positive (0.6% surplus in 2017), following ≈10%

deficits for most of the decade up to 2010

• The real estate market has also recovered

• Concentrated banking system (top 5 banks account for ≈80% of total market), with

comfortable liquidity and capital position, together with a lower, although still

elevated, weight of non-performing loans

• Largest private sector bank in Portugal, with an unique international position,

diversified shareholder structure and a clear governance model

1

2

3

*3%, including the impact from recapitalisation of CGD

Page 5: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

5

96.2 111.4

126.2 129.0 130.6 128.8 129.9 125.7

2010 2011 2012 2013 2014 2015 2016 2017

51.8 50.0

48.5 49.9

51.8

48.2

44.9 45.9

2010 2011 2012 2013 2014 2015 2016 2017

0

2

4

6

8

10

12

14

16

18

2004 2006 2008 2010 2012 2014 2016 2018

Fiscal consolidation creates the conditions for the sustainability of the

public debt, leading to normalisation of yields on sovereign debt

Average >10%

Average≈4%

<2%

10y Portuguese bonds (yield, %)

Yields have decreased

…with significant effort on expenditure Budget deficit decreases…

(% of GDP) (total expenditure, % of GDP)

(Public debt, % of GDP)

Debt level is expected to decrease

Source: Bank of Portugal; Ministry of Finance.

Source: Statistics Portugal for 2010-16; Bank of Portugal estimate for 2017

Source: Thomson Reuters.

0.9

11.2

7.4

5.7 4.8

7.2

4.4

2.0 3.0

2010 2011 2012 2013 2014 2015 2016 2017E

Including

recapitalisation

of CGD

Source: Statistics Portugal

1

Page 6: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

6

+1.9

-1.8

-4.0

-1.1

+0.9 +1.8 +1.6

+2.7

2010 2011 2012 2013 2014 2015 2016 2017

10.8 12.7

15.6 16.2

13.9 12.4

11.1 8.9

7.9

2010 2011 2012 2013 2014 2015 2016 2017 1Q18

-10.2

-6.0 -2.2

+1.5 +0.2 +0.3 +0.6 +0.6

2010 2011 2012 2013 2014 2015 2016 2017

Portugal has been undergoing profound structural reforms, which are

already showing positive results

Real GDP growth rate (yoy) Current account balance (% of GDP)

Unemployment rate (%)

Source: Statistics Portugal (INE); Ministry of Finance. Source: Statistics Portugal; Ministry of Finance.

Source: Statistics Portugal (INE); Ministry of Finance.

Budget deficit at 0.9% in 2017 (excluding recapitalisation of

CGD), down from 11.2% in 2010, mainly on the back of

lower levels of expenditure as a percentage of GDP

GDP up by 2.7% in 2017 from 1.6% in 2016, following the

2011-2013 recession

Unemployment has decreased significantly and continuously

from a 16.2% peak in 2013, standing at 7.9% at 1Q18 (8.9%

at 2017)

Following ≈10% deficits for most of the decade up to 2010,

the current account has turned positive from 2013 (0.6%

surplus in 2017)

1

Page 7: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

7

Housing prices and bank appraisals are recovering

Source: Eurostat.

Housing bank appraisals House price index (HPI) (€ /m2) (HPI base 100=2015)

Property prices (2010=100)

85

95

105

115

125

1Q

09

3Q

09

1Q

10

3Q

10

1Q

11

3Q

11

1Q

12

3Q

12

1Q

13

3Q

13

1Q

14

3Q

14

1Q

15

3Q

15

1Q

16

3Q

16

1Q

17

3Q

17

Total Existing New

800

900

1000

1100

1200

1300

1400

1500

Jun-0

9

Dec-0

9

Jun-1

0

Dec-1

0

Jun-1

1

Dec-1

1

Jun-1

2

Dec-1

2

Jun-1

3

Dec-1

3

Jun-1

4

Dec-1

4

Jun-1

5

Dec-1

5

Jun-1

6

Dec-1

6

Jun-1

7

Dec-1

7

Portugal Lisbon Area

Source: Statistics Portugal. Source: Statistics Portugal.

The House Price Index increased 10.5% in 4Q17 when compared

to 4Q16, with existing dwellings recording an average increase

in excess of new dwellings (+11.8% vs. +5.9%, respectively)

The average value of housing bank appraisals in Portugal stood

at €1,160 per square meter in Feb 18, up 4.6% y-o-y (+5.5% to

€1,422 in the Lisbon area)

Property prices were relatively stable in Portugal since 2000,

comparing to a volatile property market in neighboring Spain

The housing costs accounted for 17.7% of disposable household

income in Portugal, compared to 22.0% for the Eurozone as a

whole (latest available data: 2016)

0

50

100

150

200

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Spain 129

Portugal 92

1

Page 8: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

8

Portuguese financial system market shares

Branches Employees

23% 19% 17%

13% 10%

Bank 1 Bank 2 Millennium bcp Bank 4 Bank 5

Gross loans

26%

17% 15% 12% 10%

Bank 1 Millennium bcp Bank 3 Bank 4 Bank 5

20.1% 15.9% 13.2% 11.7% 11.6%

Bank 1 Millennium bcp Bank 3 Bank 4 Bank 5

Deposits

13.8% 13.5% 13.4% 11.9% 10.1%

Bank 1 Bank 2 Millennium bcp Bank 4 Bank 5

(December 2017) (December 2017)

(June 2017) (June 2017)

2

Page 9: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

9

Portuguese financial system

17.5% 17.2% 13.3%

2015 2016 2017

NPEs (Non-performing exposures) NPE coverage

LTD (Loans-to-deposits ratio) CET1 ratio

40.8% 45.3% 49.3%

2015 2016 2017

12.2% 11.3% 12.4% 11.4% 13.9%

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17

112% 102% 96% 95% 93%

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17

2

Page 10: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

10

Building the leading private sector bank in Portugal and a

relevant player in selected markets

… to leadership in Portugal and to international

presence through growth in selected affinity retail markets

From foundation…

Incorporation

and organic

growth to

become

relevant player

Consolidation to

reach critical

mass

Leadership in

Portugal, setting

the foundations

for expansion in

Poland and

Greece

Partnership

with Ageas

for insurance

business

Consolidation

of international

expansion

with a single

brand

Focus on

Portugal and on

affinity markets

Reference bank

in Portugal

Portugal -

Poland –

Mozambique –

Angola (since

2016 with a

partnership with

BPA)

Leading bank in

Portugal and

strong position

in Poland and

Mozambique

Business model

transformation

to adapt to new

customer needs 1985-1995

1995-2000

2000-2005

2005–2012

2012–2017

2017- …

3

Page 11: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

11

The largest private sector bank in Portugal

• Main business lines directed to retail

and commercial banking, investment

banking, corporate and private

banking/asset management

• Strong focus on innovation and on

Customer experience

3

Page 12: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

12

Unique international presence focused on key strategic

markets

Representation office

2 employees

Single brand

Millennium

Market share: 27.1% on loans, 26.9% on deposits

Loans to Customers (gross): €882 million

Customer funds: €1,379 million

Customers: >1.3 million

Employees: 2,477

Branches: 190

BCP shareholding: 66.7%

Mozambique

Angola

Market share: 4.4% on loans, 5.2% on deposits

Loans to Customers (gross): €11,832 million

Customers funds: €16,402 million

Customers: >1.6 million

Employees: 5,848

Branches: 356

BCP shareholding: 50.1%

Poland

On-shore branch

Loans to Customers (gross):

€228million

Customer funds: €559 million

Employees: 12

Branches: 1

Macao

China (Guangzhou)

Market share: 17.6% on loans, 17.5% on deposits

Loans to Customers (gross): €37,984 million

Customers: >2.4 million

Customer funds: €52,819 million

Employees: 7,155

Branches: 578

Portugal

Loans market share: >11%

Deposits market share: >12%

Customers: >1,000,000

Employees: >1,800

Branches: 140

BCP shareholding: 22.5%

De-consolidated from June 2016

Leading

Private Sector Bank

Retail focus

Stable position

Market know-how

Solid partnership

Since 1993

On-shore branch

Market leader

Key innovator

>5.5 million Customers

>1,100 Branches

>15,700 Employees

(excluding Angola)

3

Page 13: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

13

Diversified shareholder base, geographically scattered

Number of Shareholders

Shareholder structure

Per geography

(Last information available)

Fosun 27%

Sonangol 19%

EDP 2%

PT retail 24%

PT institutionals 6%

Non-PT retail 1%

Non-PT institutionals 21%

170.9 167.0

Dec10 Dec 17

(x1000) (Last information available)

Other 11.1%

UK/US 10.9%

Africa 19.6%

China 27.1%

Portugal 31.2%

3

Page 14: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

14

One-tier management and supervisory model, composed by a

Board of Directors

General Meeting of Shareholders

Board for International Strategy

Remuneration and Welfare Board

Statutory Auditor (ROC)

Audit Committee

Executive Committee Company Secretary

Board of Directors

Commissions and Sub-Commissions

• Legal Affairs • Costs and Investments – Costs and Investments Sub-Committee • Companies • Human Resources • Retail – Customer Experience Sub-Committee – Investment Products Sub-Committee

•Pension Funds Risk Monitoring • Security and Data Quality Commission •Digital Transformation and Procedures Commission • Operational Risk and Internal Control Monitoring •CrossNetworking

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

Client Ombudsman

•Compliance Office – AML Sub-Committee • Pension Fund Monitoring • Credit • NPE Credit • Capital, Assets and Liabilities Management •Risk •Credit at Risk

3

Page 15: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

15

Agenda

Macro and Business Overview

Strategic Plan 2013-2018

3M2018 earnings

Other information

Page 16: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

16

Key highlights

*Core income = net interest income + net fees and commission income.

**By loan-loss reserves, expected loss gap and collaterals.

• Profitable operation with a recurring capacity to generate operating results at c. €1.2 billion

per annum

Net interest benefits from continuing reduction in cost of funding: NIM of 2.2% in 1Q18

(Portugal:1.8%, up from 0.6% in 2013)

Consistent track record of delivering reduction in operating costs: cost to core-income of

48%*, vs Eurozone’s 75%. Largest operating restructuring in Portugal, with operating costs

down by >40% from 2011 (pre-programme)

• Focused NPE management through a dedicated recovery strategy in Portugal: NPE reduction of

€6.5bn from €12.8bn at year-end 2013 to €6.3bn at March 31, 2018. Increased coverage by

provisions to 46% (48% for the Group) from 23% in 2013. Total coverage** of 105% at March 31,

2018

• Resilient international recurring earnings contribution of €41mn in 1Q18 (c. € 170 mn per

annum)

• Sustainable funding strategy: loans to deposits ratio at 91% as of March 31, 2018. ECB funding at

€3.2 billion as of the same date, down from a maximum of €12.4 billion at year-end 2011

• Enhanced capital position: fully implemented CET1 ratio of 11.8%, phased-in of 11.9%, compared

to minimum required phased-in CET1 (SREP) of 8.81% for 2018; fully implemented total capital

ratio of 13.5% and phased-in total capital ratio of 13.6% (SREP requirement: 12.31%)

1

2

3

4

5

Page 17: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

17

Net interest income to benefit from continuing reduction in

cost of funding 1

-239 -173

-123 -83 -69 -59

2013 2014 2015 2016 2017 1Q18

Net Interest Income

... leading to a decrease in total funding

costs

NII to improve, as cost of time deposits keeps

decreasing ...

(€ mn)

(Interest expenses divided by Interest-bearing liabilities) (Portugal, spread on TDs book vs 3m Euribor, bps)

64 97 175 172 194 192

808

343

527

711 736

2013 2014 2015 2016 2017 1Q18

2.41% 1.92%

1.21% 0.78% 0.44% 0.38%

2013 2014 2015 2016 2017 1Q18

NIM

1.8%

0.6%

1.0%

1.5% 1.6% 1.8%

2013 2014 2015 2016 2017 1Q18

1Q

Front book:

-47bp

Page 18: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

18

Consistent track record of delivering reduction in

operating costs 1

9,959 8,584 7,795 7,459 7,333 7,189 7,155

2011 2013 2014 2015 2016 2017 Mar 18

* Excluding non-usual items in 2016: impact from revision of collective labour agreement net of restructuring costs.

885 774 695 671 618 578 578

2011 2013 2014 2015 2016 2017 Mar 18

196 213 173 158 155 153 153

588

1,039

853

690 644 624

2011 2013 2014 2015 2016 2017 1Q18

...with a >30% reduction in branches...

Operating costs down by > 40% vs 2011 (pre-

programme) ...

Branches (#)

Employees (#)

... and >25% reduction in employees

Operating costs (€ mn)

*

1Q

Page 19: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

19

1

Pre-provision profit

Millennium bcp: one of the most efficient banks in the

Eurozone

Cost to core income*

Bank 1

Bank 2

Bank 3

Bank 4

Latest available information

vs. peers in

Portugal

vs. Euro-zone

banks

58%

85%

65%

49%

51%

48%

75%

84%

105%

82%

55%

48%

86%

48%

2013 1Q18

-38pp

Cost to core income*

80% 75% -4pp

*Core income = net interest income + net fees and commission income.

122 296 292

474

1,243

2013 2017 1Q18

Page 20: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

20

Asset quality metrics to benefit further from continued focus

on NPE reduction

2

743 1,021 730 1,045

Cost of risk and loan-loss charges

Impairment

charges (€mn)

Cost of risk

(basis points)

-1,5p.a.

NPEs (EBA definition) (€ bn)

Other

NPLs>90d

(Basis points)

Continued decrease of NPEs over the last 4.25 years at a

pace of €1.5bn per year as a result of a stabilisation of the

macro environment and the measures implemented

Reduction of €6.5bn from Dec 13 to Mar 18

Cost of risk at 96bps in 1Q18 with NPE coverage by

provision at 46% and total coverage* at 105% by Mar 18

NPEs net from loan-loss reserves were down to €3.4 billion

as at March 31, 2018 from €9.8 billion at year-end 2013

Cost of risk at 85 bps and NPE coverage by provisions at

48%, at a Group level

533

* Coverage by LLRs, collateral and expected loss gap.

6.2 6.1 5.6 5.0 4.1 3.9

12.8 10.9

9.8 8.5

6.8 6.3

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

157

233 175

266

140 96

2013 2014 2015 2016 2017 1Q18

89

NPE coverage

23% 28%

31%

39% 42%

46%

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

Total

coverage* 101.4% 105.6% 90.3% 92.6% 105.2%

Coverage by

LLRs

86.0%

Page 21: CORPORATE PRESENTATION - Millenniumbcp · 2 Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction

21

Strong coverage levels

Individuals 26%

Companies 74%

NPLs >90d 62%

Other NPEs 38%

2

(March 2018)

NPE breakdown Total NPEs: €6.3bn

*By loan-loss reserves, expected loss gap and collaterals.

NPE total coverage*

Other NPE total coverage* NPL >90d total coverage*

LLRs

Real estate

collateral

Cash, other

fin.collat., EL gap

LLRs

Real estate

collateral

Cash, other

fin.collat., EL gap LLRs

Real estate

collateral

Cash, other

fin.collat., EL gap

24% 54% 46% 7%

18% 15%

70%

35% 44%

101% 107% 105%

Individuals Companies Total

13%

45% 37% 12%

14% 14%

79%

49% 56%

105% 108% 107%

Individuals Companies Total

30%

61% 52% 4%

20% 15%

64%

25% 36%

98% 106% 104%

Individuals Companies Total

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22

Diversified and coherent international exposure delivering resilient

contribution 3

Key international operations Contribution to consolidated results*

* Comparable, assuming shareholding in Bank Millennium (Poland) constant at 50.1% and excluding discontinued operations

(€ mn)

Market share: 4.4% on loans, 5.2% on deposits

Loans to Customers (gross): €11,832 million

Customers funds: €16,402 million

Customers: >1.6 million

Employees: 5,848

Branches: 356

BCP shareholding: 50.1%

Poland

Angola

Loans market share: >11%

Deposits market share: >12%

Customers: >1,000,000

Employees: >1,800

Branches: 140

BCP shareholding: 22.5%

De-consolidated from June 2016

Market share: 27.1% on loans, 26.9% on

deposits

Loans to Customers (gross): €882 million

Customer funds: €1,379 million

Customers: >1.3 million

Employees: 2,477

Branches: 190

BCP shareholding: 66.7%

Mozambique

159

178 170 173 175

41

2013 2014 2015 2016 2017 1Q18

1Q

Full year

** Excluding IAS 29 impact for the Angola operation in the amount of €28.4 million

**

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23

Balanced Sheet

Sovereign debt portfolio

Securities portfolio (€ bn)

(Billion euros) Debt issued

Balance sheet breakdown (€ bn)

68.0

47.5 47.0 52.4

12.1

12.9 13.2

3.2

18.5 7.2

5.8

4.4

6.8

Dec 11 Mar 18

2.3

Equity

MM (net) Debt issued

Other (net)

Loans

Securities

Other

Sovereign

debt

(Billion euros)

7.3 10.3

4.8

2.9

12.1 13.2

Dec 11 Mar 18

Deposits

Dec 11 Mar 18

Portugal 4.7 4.7

T-bills 1.7 0.5

Bonds 3.0 4.2

Poland 0.8 4.0

Mozambique 0.3 0.6

Other 1.5 1.1

Total 7.3 10.3

Dec 11 Mar 18

Debt securities 16.2 2.9

Senior - MTN 7.6 0.2

Senior - Retail Bonds 4.1 1.4

Covered bonds 3.3 1.0

Securitisation 1.2 0.3

Subordinated debt 1.1 1.2

Loan Agreements 1.2 1.7

Total 18.5 5.8

4

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24

Stronger funding and liquidity 4

Net loans Deposits

(€ bn)

Commercial gap (net loans – deposits)

Important deleveraging process: -31% loans

+10% deposits which account for 85% of funding

compared to 62% in 2011

Loans to deposit ratio at 91% versus 143% in 2011

Foreign operations self funded

(€ bn)

143% 91% Loans to deposits ratio

20.5 13.2 7.8 3.9 0.4

-0.8 -3.6 -5.4

Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec 17 Mar18

(€ bn)

68.0 62.6 56.8 53.7 52.0 48.0 47.6 47.0

Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Mar18

47.5 49.4 49.0 49.8 51.5 48.8 51.2 52.4

Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec 17 Mar18

-31% +10%

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25

Credit, deposits and Customers 4

Credit Performing portfolio

34.5 32.9

31.8 30.8 31.2 31.7

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

• The performing portfolio increased in Portugal

by approximately €500 million from year-end

2017, with the total portfolio remaining stable

• Stable deposits as the decrease of term deposits

(due to historically low yields) has been

compensated by expanding demand deposits

• Significant Customer acquisition from 2017

Customer deposits

9.0 10.1 12.9 14.1 16.4 17.0

24.9 24.3 21.9 19.9 18.9 19.1

33.9 34.4 34.8 34.0 35.3 36.1

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

On-demand

deposits

Term

deposits

(€ bn) (€ bn)

Total Customers

(x1,000)

2,317 2,308 2,330 2,350 2,445 2,474

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

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26

Continued reduction of ECB funding 4

ECB funding

(€ bn)

Net usage of ECB funding at €3.2 billion, compared to

€12.4 billion at December 31, 2011

€14.2 billion (net of haircut) of eligible assets available

for refinancing operations with ECB, of which €3.5

billion are related to Portuguese sovereign debt, with a

€11.0 billion buffer

Future debt repayments (medium-long term)

significantly lower than in the past

Compliance with relevant liquidity ratios

Liquidity ratios (CRD IV/CRR)

126%

180%

NSFR (Net stable funding ratio)

LCR (Liquidity coverage ratio)

Buffer

ECB

funding

Total

collateral

(€ bn)

Outstanding debt repayments (medium-long term)

Already repaid To be repaid

2.3 2.3

0.2 0.5 0.5

4.8

Average 2011-2016

2017 1Q18 2018 2019 >2019

12.4 10.5 10.0 6.6 5.3 4.4 3.0 3.2

15.7

22.3 19.9

14.2 13.9 12.1 12.8 14.2

Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec 17 Mar 18

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27

Enhanced capital position 5

Minimum capital requirements (SREP)

Capital ratio* (Million euros)

-720 -115 -50

5,769

4,884

Equity DTAs EL gap Other CET1 fully imp.

From equity to CET1 capital*

11.8% CET1 ratio

fully imp.

6.4%

9.3% 11.1% 11.9% 11.8%

Dec09 Dec11 Dec16** Dec17 Mar18

CT1 ratio, BoP definition CET1 ratio fully implemented, CRDIV/CRR

Pillar 1Conservation

buffer

Counter-

cyclical

buffer

Other syst.

important

institutions

buffer

Pillar 2

requirements

(P2R)

Total

require

-ments

Mar 18

CET1 4.50% 1.875% 0.00% 0.1875% 2.25% 8.81% 11.8%

Total capital 8.00% 1.875% 0.00% 0.1875% 2.25% 12.31% 13.5%

*Estimates including earnings for the first quarter. **Estimates as at January 1, 2017, adjusted by the impact of the capital increase and of

CoCos repayment, both completed in February 2017.

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28

3.1% 4.5%

5.7% 6.7% 6.5%

FR DE ES IT

Capital at comfortable levels, strong leverage ratios

Leverage ratio

Texas ratio*

Leverage ratio

5.7% 6.5%

Mar 17 Mar 18

Fully implemented, latest available data

98.2%

79.2%

Mar 17 Mar 18

26% 25%

43% 42%

57%

FR DE ES IT

RWA density RWAs as % of assets, latest available data

Fully implemented

*Texas ratio = NPE / (Tangible equity + loan-loss reserves).

5

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29

Strategic plan for 2018

1 Estimates including earnings for the first quarter.

2 Core income = net interest income + net fees and commission income.

3 Based on a fully implemented CET1 of 11%.

Consolidated

Cost of risk

Cumulative NPE reduction

from January 1, 2016 (Portugal)

CET1 fully implemented1

Loans to Deposits

Cost-Core Income2

Cost–Income

1Q17 1Q18 2018

114 bp

-€1.5 billion

11.2%

97%

48.3%

44.6%

85 bp

-€3.5 billion

11.8%

91%

48.0%

45.7%

<75 bp

-€3.0 billion

≈11%

<100%

<50%

≈43%

4.7% 7.7% ≈10% RoE3

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30

Investment case

1

2

3

4

Reference private sector bank in Portugal, and well-positioned in a rapidly

changing landscape, following the completion of the restructuring plan

successfully implemented over the last years: one of the most efficient

banks in the Eurozone, with cost to core income ratio of 48% (Eurozone:

75%) and cost to income ratio of 46%

Profitable commercial banking business model with highly recurrent

operating results, supported by a continued track record of improvement

in operating performance: PPP of approximately €1.2 billion per annum

Profitable and self-funded international operations

Strong balance sheet (fully implemented CET1 ratio at 11.8%, loans to

deposits of 91%)

Distinct

position

Return to normalization allows Millennium bcp to focus on its core

strengths

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31

Agenda

Macro and Business Overview

Strategic Plan 2013-2018

3M2018 earnings

Other information

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32

3M2018 earnings

Highlights

Group

• Profitability

• Liquidity

• Capital

Portugal

International operations

Conclusions

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33

Summary

• Net profit of €85.6 million (€50.1 million in 1Q17), on the back of

strong earnings from the domestic activity and a robust performance

from the international business, whose contribution was stable

• NPEs significantly down again: approximately -€500 million from year-

end 2017 to €6.3 billion in Portugal, with coverage by loan-loss

reserves reinforced to 46% (48% for the Group), 105% including

collaterals

• Performing credit portfolio up by approximately €500 million from

year-end 2017, together with a stable total loan portfolio

• Strong business performance, with Customer acquisition and Customer

funds standing out. Active Customers for the Group total 5.6 million,

an increase in excess of 380,000 Customers from March 31, 2017; total

Customers funds amounted to €72.7 billion, a 5.7% increase from March

31, 2017

1

2

3

4

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34

Highlights: improved profitability 1

(Million euros)

Net income

Core net income*

43.2

117.4

205.8 213.2 254.8 266.6

1Q13 1Q14 1Q15 1Q16 1Q17 1Q18

-45.2

-152.0

-40.7

70.4 46.7 50.1

85.6

1Q13 1Q14 1Q15 1Q16 1Q17 1Q18

Not including gains on

Portuguese sovereign debt

of €116 million

*Core net income = net interest income + net fees and commission income - operating costs.

**47.3% excluding specific items.

• Net earnings of €85.6 million in 1Q18,

a 70.8% increase from €50.1 million

in the same period of the previous

year

• Earnings from domestic activity

improved significantly: €44.5 million

in 1Q18, compared to €9.0 million in

the same period of 2017

• Core net income increased to €266.6

million in 1Q18, keeping the continued

improvement seen in the last years

• One of the most efficient banks in the

Eurozone, with cost to core income of

48.0%** (cost to income of 45.7%)

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35

Highlights: improved asset quality 2

(Million euros)

Non-performing exposures (NPEs)

NPE coverage

6,213 6,134 5,572 5,029 4,058 3,872

12,783 10,921

9,777 8,538

6,754 6,282

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

NPL>90d

Other

NPEs

23% 28%

31%

39% 42%

46%

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

Total

coverage* 101.4% 105.6% 90.3% 92.6% 105.2%

Coverage by

LLRs

86.0%

• NPEs in Portugal down to €6.3 billion as at

March 31, 2018, a reduction of

approximately €500 million from year-end

2017

• The NPE decrease from year-end 2017 is

attributable to a €0.2 billion NPL>90d

reduction and to a €0.3 billion reduction of

other NPEs

• NPE total coverage* of 105%, broken down as

follows:

– coverage by loan-loss reserves of 46%

– coverage by real-estate collateral of 44%

– coverage by financial collateral of 13%

– coverage by expected loss gap of 2%

• NPEs net from loan-loss reserves were down

to €3.4 billion as at March 31, 2018 from

€9.8 billion at year-end 2013

*By loan-loss reserves, expected loss gap and collaterals.

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36

Highlights: credit now growing in Portugal 3

(Billion euros)

Performing portfolio

34.5 32.9

31.8 30.8 31.2 31.7

Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18

Companies portfolio

-5.5 -0.8 -0.1

+0.1

25.2

18.9 18.9

Dec 13 Construction, real estate, holding cos.

Other activities

Dec 17 Construction, real estate, holding cos.

Other activities

Mar 18

• The performing portfolio increased in

Portugal by approximately €500 million from

year-end 2017, with the total portfolio

remaining stable

• Structural change to the portfolio of loans to

companies over recent years, with a lower

weight of construction and real-estate

activities and of non-financial holding

companies

• Strong credit activity in 1Q18:

– Market leadership in the “Portugal 2020”

programme, with a 31% share of total

funding

– Market leadership in factoring business,

with a 24% share

– Market leadership in leasing business, with

a 17% share

– Leading bank in loans to exporting

companies, with a 19% share

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37

Highlights: strong business performance, focus on

Customers 4

Total Customers

5.2 5.6

Mar 17 Mar 18

+380,000

2.4 2.5

Mar 17 Mar 18

+113,000

Group

Portugal

• More than 1 million Customers hold bundled solutions to help managing their day-to-day financial life

• Leader in online brokerage, with a 22.6% market share

• Closest to Customers, most innovating, top ranked in satisfaction with quality of products (BASEF)

• New 100% digital account opening service (Millennium bcp and ActivoBank app)

(Million)

(Million)

Digital Customers

2.2 2.6

Mar 17 Mar 18

+362,000

0.8 0.9

Mar 17 Mar 18

+121,000

Group

Portugal

(Million)

(Million)

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38

3M2018 earnings

Highlights

Group

• Profitability

• Liquidity

• Capital

Portugal

International operations

Conclusions

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39

Profit of €85.6 million in the 1st quarter of 2018

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

(million euros) 1Q17 1Q18 YoYImpact on

earnings

Net interest income 332.3 344.8 +3.8% +12.5

Commissions 160.8 167.8 +4.4% +7.0

Operating costs -238.3 -246.0 +3.2% -7.7

Of which: non-recurring -7.7 -3.5

Core net income 254.8 266.6 +4.6% +11.7

Other income* 40.9 25.2 -38.4% -15.7

Operating net income 295.8 291.8 -1.3% -4.0

Impairment and provisions -203.2 -129.9 -36.1% +73.3

Net income before income tax 92.5 161.8 +74.9% +69.3

Income taxes and non-controlling interests -42.4 -76.2 +79.7% -33.8

Net income 50.1 85.6 +70.8% +35.5

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40

Increased net interest income

(Million euros)

Net interest income Portugal

Net interest margin 2.2% 2.2%

332.3 344.8

1Q17 1Q18

+3.8%

138.2 152.8

1Q17 1Q18

Net interest margin 1.8% 1.8%

194.1 192.0

1Q17 1Q18

-1.1%

International operations

+10.6%

Net interest margin 3.0% 3.2%

Consolidated

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41

Increased commissions

(Million euros)

108.2 113.0

1Q17 1Q18

Fees and commissions

52.6 54.8

1Q17 1Q18

+4.1%

Portugal

International operations

+4.5%

Consolidated

1Q17 1Q18 YoY

Banking fees and commissions 135.1 139.4 +3.2%

Cards and transfers 37.6 40.0 +6.3%

Loans and guarantees 38.7 39.1 +1.1%

Bancassurance 23.2 24.7 +6.3%

Customer account related 26.0 26.2 +0.7%

Other fees and commissions 9.6 9.4 -1.3%

Market related fees and commissions 25.7 28.5 +10.6%

Securities operations 15.8 17.3 +9.8%

Asset management 10.0 11.2 +11.8%

Total fees and commissions 160.8 167.8 +4.4%

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42

36.4 34.4

19.7 19.9

-15.2

-29.1

40.9 25.2

1Q17 1Q18

Other income*

(Million euros)

Other income* Portugal

International operations

2.5

-3.1

1Q17 1Q18

Mandatory

contributions 24.2 25.6

38.4 28.2

1Q17 1Q18

Consolidated

-38.4% -26.4%

Net trading

income

Equity earnings

+ dividends

Other operating

income

Includes €5.7 million

losses related to real-

estate

Includes gain on sale of building

and insurance compensation

(€3.1 million)

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

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43

Operating costs

(Million euros)

Operating costs

136.9 142.3

88.7 89.5

12.7 14.2 238.3

246.0

1Q17 1Q18

+3.2%

Staff costs

Other

administrative

costs

Depreciation

Cost to core

income* 48.3% 48.0%

152.5 153.4

1Q17 1Q18

85.8 92.6

1Q17 1Q18

Portugal

International operations

Cost to core

income* 50.4% 50.3%

Cost to core

income* 45.0% 44.6%

+7.9%

Cost to income 44.6% 45.7% Cost to income 44.8% 46.0%

Cost to income 44.4% 45.3%

Consolidated

+0.6%

*Core income = net interest income + net fees and commission income.

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44

Millennium bcp: one of the most efficient banks in the

Eurozone

Cost to core income*

Banco 1

Banco 2

Banco 3

Banco 4

Latest available information

vs. peers in

Portugal

vs. Euro-zone

banks

58%

85%

65%

49%

51%

48%

75%

84%

105%

82%

55%

48%

86%

48%

2013 1Q18

-38pp

Cost to core income*

80% 75% -4pp

73%

46%

2013 1Q18

-27pp

Cost to income

67% 63% -3pp

*Core income = net interest income + net fees and commission income.

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45

Strengthening the balance sheet: cost of risk trending

towards normalisation (Million euros)

148.9

106.1

54.3

23.9

203.2

129.9

1Q17 1Q18

Impairment and provision charges Portugal

International operations

125.9 89.0

56.8

19.0

182.7

108.0

1Q17 1Q18

-40.9%

-36.1%

114bp 85bp

Loans

Cost of risk

Other

22.9 17.1 -2.4

4.9

20.5 22.0

1Q17 1Q18

Loans

Cost of risk

Other

Loans

Cost of risk

Other

128bp 96bp

+7.1%

Consolidated

71bp 53bp

Loan-loss

reserves 3,709 3,447

Loan-loss

reserves 3,280 2,915

Loan-loss

reserves 429 532

Includes €4.6 million of

IAS29 impact (Angola)

Includes €10.2 million

of real-estate

impairment

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46

Lower delinquency and increased coverage

5,212 4,323

3,947

2,834

9,159

7,157

Mar 17 Mar 18

8,320

6,282

Mar 17 Mar 18

839 875

Mar 17 Mar 18

(Million euros)

Portugal Credit quality

International operations

NPEs

NPEs

+4.3%

-24.5%

Consolidated

Down from €944

million at June

30, 2017

NPEs

NPL>90d

Other

-21.9%

NPE coverage by

LLRs 40.5% 48.2%***

*EBA definition.

**By loan-loss reserves, expected loss gap and collaterals.

***Does not include 2% of coverage by expected loss gap (deducted from capital).

Mar 17 Mar 18

NPL>90 days ratio 10.0% 8.5%

NPE ratio* 17.5% 14.0%

NPE ratio inc. securities and off-BS* 13.9% 10.3%

NPE total coverage** 100% 103%

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47

3M2018 earnings

Highlights

Group

• Profitability

• Liquidity

• Capital

Portugal

International operations

Conclusions

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48

Strong business dynamics results in growing Customer funds in

Portugal and in international operations (Million euros)

Tot. Customer funds* international operations

Total Customer funds* in Portugal

23,113 26,579

27,025 25,811

1,536 1,402

17,096 18,877

68,769 72,669

Mar 17 Mar 18

Total Customers funds*

On-

demand

deposits

Term

deposits

Other BS

funds

Off-BS

funds

+5.7%

Consolidated

14,605 16,992

20,026 19,107

15,504 16,720

50,136 52,819

Mar 17 Mar 18

Demand

deposits

Term

deposits

Other

+5.4%

+6.0% including

OTRVs

8,507 9,587

6,999 6,704

3,128 3,559

18,633 19,849

Mar 17 Mar 18

Demand

deposits

Term

deposits

Other

+6.5%

*Deposits, debt securities, assets under management, capitalisation products and investment funds placed with Customers.

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49

Increasing performing portfolio, total portfolio stable from end-

2017

(Million euros)

Loans to Customers (gross)

24,116 23,750

4,235 3,845

23,892 23,365

52,242 50,959

Mar 17 Mar 18

Companies

Consumer

and other

Mortgage

International operations

Portugal

-2.5%

12,856 12,976

Mar 17 Mar 18

Consolidated

NPE: -21.6% (-€2.0 billion)

Performing: +1.6% (+€0.7 billion)

39,386 37,984

Mar 17 Mar 18

-3.6%

NPE: -24.5% (-€2.0 billion)

Performing: +2.0% (+€0.6 billion)

+0.9%

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50

Comfortable liquidity position

Net loans to deposits ratio

97%

91%

Mar 17 Mar 18

-6pp

ECB funding

(Billion euros)

3.7 3.2

Mar 17 Mar 18

14.2 13.1 Eligible

assets

Liquidity ratios (CRD IV/CRR)

126%

180%

NSFR (Net stable funding ratio)

LCR (Liquidity coverage ratio)

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51

3M2018 earnings

Highlights

Group

• Profitability

• Liquidity

• Capital

Portugal

International operations

Conclusions

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52

Strengthened capital

Fully implemented

11.2% 11.8%

Mar 17 Mar 18

38.3 41.1 RWAs (€Bn)

12.3% 13.5% Total ratio

Common Equity Tier 1 ratio*

ECB requirement

(SREP) for CET1 in

2018: 8.8%

CET1 capital ratio of 11.8% (fully

implemented) and 11.9% (phased-in)

Increase from 11.2% fully implemented as

at March 31, 2017 due to earnings in the

last 4 quarters and to the increase in fair

value reserves, partially cancelled out by

the IFRS9 first time adoption and by the

deduction of irrevocable payment

commitments (DGF/SRF)

Decrease from 11.9% fully implemented at

year-end 2017 due to the IFRS9 first time

adoption and to the deduction of

irrevocable payment commitments

(DGF/SRF), partially compensated for by the

earnings for the quarter

Total capital ratios at 13.5% (fully

implemented) and at 13.6% (phased-in),

boosted by the €300 million subordinated

debt (tier 2) issued in December 2017

*Estimates including earnings for the first quarter.

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53

3.1% 4.5%

5.7% 6.7% 6.5%

FR DE ES IT

Capital at comfortable levels, strong leverage ratios

Leverage ratio

Texas ratio*

Leverage ratio

5.7% 6.5%

Mar 17 Mar 18

Fully implemented, latest available data

98.2%

79.2%

Mar 17 Mar 18

26% 25%

43% 42%

57%

FR DE ES IT

RWA density RWAs as % of assets, latest available data

Fully implemented

*Texas ratio = NPE / (Tangible equity + loan-loss reserves).

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54

3M2018 earnings

Highlights

Group

• Profitability

• Liquidity

• Capital

Portugal

International operations

Conclusions

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55

152.5 153.4

1Q17 1Q18

9.0

44.5

1Q17 1Q18

340.7 333.3

1Q17 1Q18

Increased net income

(Million euros)

Net income

Operating costs

Banking income

+35.4

Net earnings of €44.5 million in 1Q18, +€35.4

million compared to €9.0 million in 1Q17

Net earnings were boosted by the significant

decrease in credit-loss charges (-29.4%, with

cost of risk decreasing to 96bp to 128bp), as

well as by lower other impairment and

provisions (-66.5%)

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56

Net interest income

Net interest income (Million euros)

-1.1%

+6.3 +5.7

-6.2 -5.1 -2.3 -0.7

194.1 192.0

1Q17 CoCo repayment

effect

Effect of cost of time deposits

Performing loans volume

effect

Effect of net recovery of

interest

Effect of securities portfolio

Credit yield effect, net of WSF cost,

other

1Q18

1.8% 1.8% NIM

Net interest income decreased from €194.1 million in 1Q17 to €192.0 million in the same period of 2018. The favourable

impacts of the repayment of CoCos and of the consistent reduction of the cost of time deposits were more than offset

by the negative effects of lower credit volumes, reflecting, to a large extent, the focus on NPE reduction (unlikely to

pay); of the net recovery of interest (including IFRS9); of the securities portfolio (increased balance yielding lower

interest, reflecting lower sovereign yields); and of lower credit yields (reflecting the normalisation of the

macro-economic environment), net of a lower wholesale funding cost

The decrease from €216.0 million in 4Q17 was a result of a lower amount related to TLTRO (the amount for the full year

2017 was booked in 4Q17); of the effect of the net recovery of interest (including IFRS9); of the securities portfolio

(increased balance yielding lower interest, reflecting lower sovereign yields); and of a lower number of days in the

quarter (90 days in 1Q18, 92 days in 4Q17)

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57

Continued effort to reduce the cost of deposits

Spread on the performing loan book

-0.70%

-0.59%

1Q17 1Q18

(vs 3m Euribor)

Spread on the book of term deposits (vs 3m Euribor)

2.78% 2.63%

1Q17 1Q18

NIM

1.8% 1.8%

1Q17 1Q18

Continued improvement of the spread of the

portfolio of term deposits: to -0.59% in 1Q18

from -0.70% in the same period of 2017; front

book for 1Q18 priced at an average spread of

-47bp, still below current back book’s spread

Spread on the performing loan book at 2.63%

in 1Q2018 (2.78% in 1Q2017)

NIM stood at 1.8%

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58

Commissions and other income*

(Million euros)

38.4

28.2

1Q17 1Q18

-26.4%

Fees and commissions Other income*

Growing commissions in Portugal,

with the performance of market

related fees (and, in particular,

brokerage) and of bancassurance

standing out

Lower other income, influenced by

the booking of €5.7 million losses

related to real-estate

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

1Q17 1Q18 YoY

Banking fees and commissions 96.2 98.9 +2.9%

Cards and transfers 26.1 26.4 +1.2%

Loans and guarantees 25.0 25.4 +1.9%

Bancassurance 19.9 20.6 +3.5%

Customer account related 23.2 23.4 +0.8%

Other fees and commissions 2.0 3.1 +56.1%

Market related fees and commissions 12.0 14.1 +17.2%

Securities operations 10.5 12.3 +16.9%

Asset management 1.5 1.8 +18.7%

Total fees and commissions 108.2 113.0 +4.5%

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59

Operating costs

Employees

Branches

(Million euros)

89.8 91.1

54.7 53.3

8.0 9.0

152.5 153.4

1Q17 1Q18

Operating costs

615 578

Mar 17 Mar 18

-37

7,327 7,155

Mar 17 Mar 18

-172

Staff costs

Other

administrative

costs

Depreciation

Cost to core

income* 50.4% 50.3%

Cost to income 44.8% 46.0%

+0.6%

*Core income = net interest income + net fees and commission income.

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60

Lower NPEs, with reinforced coverage

(Million euros)

NPE build-up

NPEs in Portugal down by €2.0 billion, from €8.3 billion as at

March 31, 2017 to €6.3 billion as at the same date of 2018

This decrease results from net exits of €902 million, sales of

€666 million and write-offs of €471 million

The decrease in NPE from March 31, 2017 is attributable to a

€0.9 billion reduction of NPL>90d and to a €1.1 decrease of

other NPE

Significant NPE decrease during the quarter, from €6.8 billion

at end-2017 to €6.3 billion as of March 31, 2018 (-€0.5 billion)

Cost of risk decreased to 96bp in 1Q18 from 128bp in 1Q17,

while NPE coverage by loan-loss reserves was reinforced to

46% from 39%, respectivelly

Mar 18

vs.Mar 17

Mar 18

vs.Dec 17

Opening balance 8,320 6,754

+/- Net entries -902 -273

- Write-offs -471 -37

- Sales -666 -162

Ending balance 6,282 6,282

Non-performing exposures (NPEs)

4,819 3,872

3,501 2,410

8,320

6,282

Mar 17 Mar 18

-24.5%

NPL>90d

Other NPEs

Loan impairment (net of recoveries)

125.9 89.0

1Q17 1Q18

128bp 96bp Cost of

risk

Loan-loss

reserves 3,280 2,915

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61

Reinforced NPE coverage

NPE total coverage* NPE total coverage*

Other NPE total coverage* NPL >90d total coverage*

LLRs

Real estate

collateral

Cash, other

fin.collat., EL gap

LLRs

Real estate

collateral

Cash, other

fin.collat., EL gap LLRs

Real estate

collateral

Cash, other

fin.collat., EL gap

24% 54% 46% 7%

18% 15%

70%

35% 44%

101% 107% 105%

Individuals Companies Total

13%

45% 37% 12%

14% 14%

79%

49% 56%

105% 108% 107%

Individuals Companies Total

30%

61% 52% 4%

20% 15%

64%

25% 36%

98% 106% 104%

Individuals Companies Total

LLRs

Real estate

collateral

Cash, other

fin.collat., EL gap

39% 46%

15% 15%

45% 44%

100% 105%

Mar 17 Mar 18

*By loan-loss reserves, expected loss gap and collaterals.

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62

Foreclosed assets and corporate restructuring funds

Foreclosed assets

Sales of foreclosed assets

(Million euros)

(Million euros)

79 83

1Q17 1Q18

Book value

1,597 1,525

188 232

1,785 1,757

Mar 17 Mar 18

Net value

Impairment

Corporate restructuring funds

(Million euros)

# properties

sold 719 919

Sale value 86 96

9 0

861 823

224 199

1,094 1,022

Mar 17 Mar 18

Original credit exposure: €2,006 million

Book value (31 Mar 2018): €1,022 million

Total impairment (credit+restr. funds): €984 milion

(49% coverage)

Construction

RE/tourism

Industry

-4.5% -6.6%

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63

14,605 16,992

20,026 19,107

1,439 1,293

14,065 15,427

50,136 52,819

Mar 17 Mar 18

19,347 18,891

2,533 2,006

17,506 17,087

39,386 37,984

Mar 17 Mar 18

Strong business dynamics leads to increased Customer funds and

performing credit portfolio

(Million euros)

Loans to Customers (gross) Total Customer funds*

+5.4%

-3.6%

On-

demand

deposits

Term

deposits

Other BS

funds

Off-BS

funds

Companies

Consumer

and other

Mortgage

NPE: -24.5% (-€2.0 billion)

Performing: +2.0% (+€0.6 billion)

*Deposits, debt securities, assets under management, capitalisation products and investment funds placed with Customers.

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64

3M2018 earnings

Highlights

Group

• Profitability

• Liquidity

• Capital

Portugal

International operations

Conclusions

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65

Stable contribution from international operations

*Contribution of the Angolan operation.

**Includes goodwill impairment (-€4.6 million) and contribution revaluation (+€3.5 million).

Subsidiaries’ net income presented for 2017 at the same exchange rate as of 2018 for comparison purposes.

(Million euros)

41.1 41.1

Contribution 1Q17 Contribution 1Q18

+0.1%

1Q17 1Q18Δ %

local currency

Δ %

eurosROE

Poland 33.7 37.2 +10.5% +14.1% 8.2%

Mozambique 20.7 24.7 +19.2% +18.9% 25.9%

Angola*

Before IAS 29 impact 5.3 4.1

IAS 29 impact** -- -1.1

Total Angola including IAS 29 impact 5.3 2.9

Other 3.1 3.1 -1.2% -5.5%

Net income 62.8 67.9 +8.2% +5.7%

Non-controlling interests Poland and Mozambique -23.7 -26.8

Exchange rate effect 2.0 --

Contribution from international operations 41.1 41.1 +0.1%

Same as above without FX effect and IAS 29 (Angola) 39.1 42.3 +8.1%

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66

Increased net income

75.4 79.2

1Q17 1Q18

(Million euros)

Net income

Operating costs

ROE 8.1% 8.2%

+5.0%

FX effect excluded. €/Zloty constant at March 2018 levels: Income Statement 4.17110000; Balance Sheet 4.2116. | *Pro forma data. Margin

from derivative products, including those from hedging FX denominated loan portfolio, is included in net interest income, whereas in

accounting terms, part of this margin (€2.0 million in 2018 and €4.2 million in 2017) is presented in net trading income.

Banking income

33.7 37.2

1Q17 1Q18

+10.5% 149.3 157.4

1Q17 1Q18

+5.4%

Net earnings at €37.2 million, with ROE of 8.2%.

Net interest income up by 6.2%*, commissions by

3.8% and operating costs by 5.0%

Customer funds up by 7.6%, with loans to

customers increasing by 13.4% excluding FX-

denominated loans

CET1 ratio of 22.3% as at March 31, 2018

1.7 million active Customers, 10% up from March

31, 2017, with 1.2 million active digital Customers

(+17%)

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67

39.8 41.4

10.9 11.3

50.8 52.7

1Q17 1Q18

Increased net interest income and commissions

*Pro forma data. Margin from derivative products, including those from hedging FX denominated loan portfolio, is included in net interest

income, whereas in accounting terms, part of this margin (€2.0 million in 2018 and €4.2 million in 2017) is presented in net trading income.

| FX effect excluded. €/Zloty constant at March 2018 levels: Income Statement 4.17110000; Balance Sheet 4.2116.

34.8 37.8

40.6 41.4

75.4 79.2

1Q17 1Q18

Net interest income*

Commissions and other income

Operating costs

Branches Employees

+5.0%

365 356

Mar 17 Mar 18

98.6 104.7

1Q17 1Q18

+6.2%

(Million euros)

Staff costs

Other

+3.8%

Commissions

Other

NIM 2.5% 2.5% Cost to income 50.5% 50.3%

+3.8%

+8.7%

+1.9%

5,854 5,848

Mar 17 Mar 18

-6 -9

Does not include tax on

assets and contribution to

resolution fund

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68

14.3 12.2

1Q17 1Q18

Credit quality

NPL>90d

Loan impairment (net of recoveries)

Loan-loss reserves

(Million euros)

NPL>90d ratio at 2.7% of total credit as at

March 31, 2018 (2.6% as at the same date of

the previous year)

Provision coverage of NPL>90d at 137%

(110% as at March 31, 2017)

Cost of risk decreased to 44bp (51bp in

1Q17)

Credit ratio Mar 17 Mar 18

NPL>90d 2.6% 2.7%

Coverage ratio Mar 17 Mar 18

NPL>90d 110% 137%

334.8 435.5

Mar 17 Mar 18

303.7 318.1

Mar 17 Mar 18

Cost of risk

51bp 44bp

-14.6%

FX effect excluded. €/Zloty constant at March 2018 levels: Income Statement 4.17110000; Balance Sheet 4.2116.

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69

7,321 8,486

6,065 5,635

98 109 1,765

2,171 15,249

16,402

Mar 17 Mar 18

Growing volumes

3,563 3,873

1,514 1,692

4,067 3,412

2,349 2,855

11,493 11,832

Mar 17 Mar 18

+3.0%

-16.1%

+11.7%

+8.7%

(Million euros)

Loans to Customers (gross) Customer funds

Companies

Consumer

and other

Mortgage foreign exchange

On-

demand

deposits

Term

deposits

Other BS

funds

Off-BS

funds

+7.6%

+15.9%

-7.1%

+12.0%

+23.0%

FX effect excluded. €/Zloty constant at March 2018 levels: Income Statement 4.17110000; Balance Sheet 4.2116.

+13.4% excluding FX

mortgage loans

Mortgage Local currency

+21.6%

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70

Growing net earnings

20.7 24.7

1Q17 1Q18

+19.2%

(Million euros)

Net income

Operating costs

55.2 57.2

1Q17 1Q18

+3.6% ROE 26.3% 25.9%

FX effect excluded. €/Metical constant at March 2018 levels : Income Statement 74.81583333; Balance Sheet 75.6750.

Banking income

20.5 20.7

1Q17 1Q18

+1.0%

Net income up by 19.2%, with ROE at 25.9%

3.6% increase in banking income, on the back of higher

net interest income (+8.6%), that more than

compensated for lower commissions (-5.9%)

Customer funds up by 0.9%, loans to customers down by

18.9%

Capital ratio of 18.7%

463,000 active mobile Customers, +18% from year-end

2017

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71

9.1 8.8

11.5 12.0

20.5 20.7

1Q17 1Q18

2,387 2,477

Mar 17 Mar 18

Growing income partially offset by the increase in

operating costs

+1.0%

(Million euros)

*Excludes employees from SIM (insurance company)

Staff costs

Other

43.9 47.7

1Q17 1Q18

+8.6%

176

190

Mar 17 Mar 18

+90 +14

-3.2%

+4.4%

NIM 10.9% 11.6% Cost to income 37.2% 36.3%

7.6 7.2

3.7 2.4

11.4 9.5

1Q17 1Q18

-16.0%

-5.9%

-36.6%

FX effect excluded. €/Metical constant at March 2018 levels : Income Statement 74.81583333; Balance Sheet 75.6750.

Net interest income

Commissions and other income

Operating costs

Branches Employees*

Commisions

Other

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72

Credit performance influenced by challenging environment

(Million euros)

NPL>90d ratio of 14,7% as at March 31,

2018, with a 66% coverage by loan-loss

reserves as at athe same date

Lower provisioning effort, as reflected by a

270bp cost of risk in 1Q18, down from 308bp

in 1Q17

Credit ratio Mar 17 Mar 18

NPL>90d 7.7% 14.7%

Coverage ratio Mar 17 Mar 18

NPL>90d 105% 66%

88.2 85.0

Mar 17 Mar 18

83.8 129.7

Mar 17 Mar 18

Cost of risk 308bp 270bp

8.5 6.0

1Q17 1Q18

-28.8%

Down from €162

million as reported in

June 2017

FX effect excluded. €/Metical constant at March 2018 levels : Income Statement 74.81583333; Balance Sheet 75.6750.

NPL>90d

Loan impairment (net of recoveries)

Loan-loss reserves

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73

737 657

629 722

1,366 1,379

Mar 17 Mar 18

886 725

189

147

12

10

1,087

882

Mar 17 Mar 18

Growing deposits and lower credit

-18.9%

-22.3%

-18.2%

(Million euros)

Companies

Consumer

and other

Mortgage

On-

demand

deposits

Term

deposits +14.7%

+0.9%

-15.1%

-10.9%

FX effect excluded. €/Metical constant at March 2018 levels : Income Statement 74.81583333; Balance Sheet 75.6750.

Loans to Customers (gross) Customer funds

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74

3M2018 earnings

Highlights

Group

• Profitability

• Liquidity

• Capital

Portugal

International operations

Conclusions

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75

Road to 2018: targets

1 Estimates including earnings for the first quarter.

2 Core income = net interest income + net fees and commission income.

3 Based on a fully implemented CET1 of 11%.

Consolidated

Cost of risk

Cumulative NPE reduction

from January 1, 2016 (Portugal)

CET1 fully implemented1

Loans to Deposits

Cost-Core Income2

Cost–Income

1Q17 1Q18 2018

114 bp

-€1.5 billion

11.2%

97%

48.3%

44.6%

85 bp

-€3.5 billion

11.8%

91%

48.0%

45.7%

<75 bp

-€3.0 billion

≈11%

<100%

<50%

≈43%

4.7% 7.7% ≈10% RoE3

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76

• Largest private sector bank based in Portugal with a balanced

shareholder structure and a sound balance sheet (fully implemented

CET1 ratio of 11.8%, loans to deposits of 91%)

• Successful implementation of the NPE reduction plan in Portugal:

approximately €0.5 billion down in the quarter, €2.0 billion down from

March 31, 2017, to €6.3 billion at the end of 1Q18

• Profitable operation with a recurring capacity to generate operating

results in excess of €1.2 billion per year (€0.3 billion in 1Q18);

contribution from domestic activity growing strongly

• One of the most efficient banks in the Eurozone, with a cost to core

income ratio of 48% (Eurozone: 75%) and a cost to income ratio of 46%

(Eurozone: 63%)

• Well-positioned in a rapidly changing landscape, following the

completion of the restructuring plan successfully implemented over

the last years: 7.3% increase in active Customers to 5.6

million,16.0% increase in active digital Customers to 2.6 million

Millennium bcp: a bank ready for the future

Profitability and

balance-sheet

indicators in line

with targets for

2018

1

2

3

4

5

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77

Appendix

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78

Sovereign debt portfolio

(Million euros)

Sovereign debt maturity Sovereign debt portfolio

≤1y 30%

>1y, ≤2y 10%

>2y, ≤5y 27%

>5y, ≤8y 30%

>8y, ≤10y 2%

>10y 1%

The sovereign debt portfolio totaled €10.3 billion, €3.1 billion of which maturing within one

year

The Portuguese sovereign debt portfolio totalled €4.7 billion, whereas the Polish and

Mozambican portfolios amounted to €4.0 billion and to €0.6 billion, respectively; “other”

includes US sovereign debt of €0.9 billion

Portugal 4,241 3,636 4,696 +11% +29%

T-bills and other 589 585 499 -15% -15%

Bonds 3,652 3,051 4,197 +15% +38%

Poland 3,745 3,160 3,981 +6% +26%

Mozambique 302 491 553 +83% +13%

Other 90 553 1,068 >100% +93%

Total 8,378 7,841 10,299 +23% +31%

QoQMar 17 Mar 18 YoYDec 17

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79

Sovereign debt portfolio

(Million euros)

*Includes financial assets held for trading at fair value through net income (€142 million).

**Includes financial assets at fair value through other comprehensive income (€9,057 million) and financial assets at amortised cost (€662

million).

Portugal Poland Mozambique Other Total

Trading book* 153 396 0 32 581

≤ 1 year 114 55 0 0 168

> 1 year and ≤ 2 years 0 33 0 0 33

> 2 years and ≤ 5 years 37 236 0 0 273

> 5 years and ≤ 8 years 2 50 0 0 52

> 8 years and ≤ 10 years 0 6 0 31 38

> 10 years 0 16 0 1 17

Banking book** 4,543 3,586 553 1,036 9,718

≤ 1 year 452 1,205 372 942 2,970

> 1 year and ≤ 2 years 0 890 61 0 951

> 2 years and ≤ 5 years 980 1,472 21 1 2,475

> 5 years and ≤ 8 years 3,066 7 0 2 3,074

> 8 years and ≤ 10 years 10 6 34 78 129

> 10 years 35 6 65 13 119

Total 4,696 3,981 553 1,068 10,299

≤ 1 year 566 1,259 372 942 3,139

> 1 year and ≤ 2 years 0 923 61 0 984

> 2 years and ≤ 5 years 1,017 1,708 21 1 2,747

> 5 years and ≤ 8 years 3,068 57 0 2 3,126

> 8 years and ≤ 10 years 10 13 34 109 166

> 10 years 35 22 65 14 136

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80

Diversified and collateralised portfolio

Mortgage 46%

Consumer / other 8%

Companies 47%

59% 25% 16%

Real guarantees Other guarantees Unsecured

Loan portfolio

Loans per collateral

Consolidated

LTV of the mortgage portfolio in Portugal

Loans

Loans to companies accounted for 47% of the loan portfolio at March 31, 2018, including 8% to construction

and real-estate sectors

Mortgage accounted for 46% of the loan portfolio, with low delinquency levels and an average LTV of 65%

84% of the loan portfolio is collateralised

Collaterals

Real estate accounts for 93% of total collateral value

80% of the real estate collateral is residential

15% 11% 13% 28% 11% 11% 10%

0-40 40-50 50-60 60-75 75-80 80-90 >90

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81

Consolidated earnings

(million euros) 1Q17 1Q18 YoYImpact on

earnings

Net interest income 332.3 344.8 3.8% +12.5

Net fees and commissions 160.8 167.8 4.4% +7.0

Other income* 40.9 25.2 -38.4% -15.7

Banking income 534.0 537.8 0.7% +3.8

Staff costs -136.9 -142.3 3.9% -5.4

Other administrative costs and depreciation -101.4 -103.7 2.3% -2.3

Operating costs -238.3 -246.0 3.2% -7.7

Operating net income (before impairment and provisions) 295.8 291.8 -1.3% -4.0

Of which: core net income** 254.8 266.6 4.6% +11.7

Loans impairment (net of recoveries) -148.9 -106.1 -28.8% +42.8

Other impairment and provisions -54.3 -23.9 -56.1% +30.5

Impairment and provisions -203.2 -129.9 -36.1% +73.3

Net income before income tax 92.5 161.8 +69.3

Income taxes -19.1 -49.3 -30.2

Non-controlling interests -23.3 -26.9 -3.6

Net income from discontinued or to be discontinued operations 0.0 0.0 0.0

Net income 50.1 85.6 +35.5

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

**Core net income = net interest income + net fees and commission income - operating costs.

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82

Consolidated balance sheet

(Million euros)

31 March

2018

31 March

2017

Assets

Cash and deposits at Central Banks 2,265.8 1,684.4

Loans and advances to credit institutions

Repayable on demand 254.5 258.3

Other loans and advances 864.0 1,337.8

Loans and advances to customers 46,950.1 48,533.7

Other financial assets at amortised cost 990.1 464.5

Financial assets held for trading 1,234.6 1,021.1

Other financial assets not held for trading

mandatorily at fair value through profit or loss 1,608.5 -

Other financial assets held for trading

at fair value through profit or loss 142.4 147.3

Financial assets at fair value through other comprehensive income 10,814.4 10,715.1

Assets with repurchase agreement 33.5 30.3

Hedging derivatives 141.7 73.6

Investments in associated companies 498.8 611.2

Non-current assets held for sale 2,144.7 2,225.4

Investment property 12.5 12.6

Other tangible assets 481.6 482.5

Goodwill and intangible assets 179.8 162.3

Current tax assets 24.8 17.7

Deferred tax assets 2,956.9 3,193.2

Other assets 1,075.2 1,106.1

Total Assets 72,673.9 72,076.9

31 March

2018

31 March

2017

Liabilities

Resources from credit institutions 7,427.1 9,284.1

Resources from customers 52,389.8 50,137.5

Debt securities issued 2,902.9 2,962.7

Financial liabilities held for trading 408.7 509.7

Hedging derivatives 140.8 287.5

Provisions 340.4 341.6

Subordinated debt 1,179.4 846.1

Current tax liabilities 12.8 38.5

Deferred tax liabilities 5.5 2.3

Other liabilities 1,041.3 932.0

Total Liabilities 65,848.7 65,342.2

Equity

Share capital 5,600.7 5,600.7

Share premium 16.5 16.5

Preference shares 59.9 59.9

Other equity instruments 2.9 2.9

Legal and statutory reserves 252.8 245.9

Treasury shares (0.3) (0.7)

Fair value reserves 24.1 (103.1)

Reserves and retained earnings (273.3) (90.9)

Net income for the period attributable to Bank's Shareholders 85.6 50.1

Total equity attrib. to Shareholders of the Bank 5,769.0 5,781.3

Non-controlling interests 1,056.2 953.4

Total Equity 6,825.2 6,734.7

72,673.9 72,076.9

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83

(Million euros)

Consolidated income statement Per quarter

Net interest income 332.3 346.2 344.7 368.1 344.8

Dividends from equity instruments 0.1 1.5 0.1 0.1 0.1

Net fees and commission income 160.8 169.5 164.3 172.1 167.8

Other operating income -15.2 -71.4 -10.4 -5.2 -29.1

Net trading income 36.4 53.5 25.1 33.4 34.4

Equity accounted earnings 19.6 15.5 21.7 34.8 19.8

Banking income 534.0 514.8 545.5 603.2 537.8

Staff costs 136.9 104.6 138.6 146.5 142.3

Other administrative costs 88.7 94.0 92.2 99.3 89.5

Depreciation 12.7 13.4 13.6 13.9 14.2

Operating costs 238.3 211.9 244.4 259.6 246.0

Operating net income bef. imp. 295.8 302.9 301.1 343.6 291.8

Loans impairment (net of recoveries) 148.9 156.1 153.6 165.1 106.1

Other impairm. and provisions 54.3 56.0 59.6 131.2 23.9

Net income before income tax 92.5 90.8 87.9 47.3 161.8

Income tax 19.1 24.3 19.7 -33.0 49.3

Non-controlling interests 23.3 27.9 24.8 27.1 26.9

Income tax 50.1 38.6 43.4 53.1 85.6

Net income arising from discont. operations 0.0 1.3 0.0 0.0 0.0

Net income 50.1 39.8 43.4 53.1 85.6

1Q 17 1Q 184Q 173Q 172Q 17

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84

Income statement (Portugal and International operations)

For the 3-month periods ended March 31st, 2017 and de 2018

(Million euros)

M ar 17 M ar 18 Δ % M ar 17 M ar 18 Δ % M ar 17 M ar 18 Δ % M ar 17 M ar 18 Δ % M ar 17 M ar 18 Δ % M ar 17 M ar 18 Δ %

Interest income 475 473 -0.5% 271 251 -7.3% 205 222 8.5% 134 146 9.2% 69 75 7.3% 2 2 -1.3%

Interest expense 143 128 -10.4% 77 59 -23.1% 67 69 4.2% 42 43 2.4% 26 27 5.6% -1 -1 26.3%

N et interest inco me 332 345 3.8% 194 192 -1.1% 138 153 10.6% 91 103 12.4% 44 48 8.3% 3 2 -12.8%

Dividends from equity instruments 0 0 -27.6% 0 0 14.2% 0 0 -46.1% 0 0 -46.1% 0 0 -- 0 0 --

Intermediat io n margin 332 345 3.7% 194 192 -1.1% 138 153 10.6% 91 103 12.4% 44 48 8.3% 3 2 -12.8%

Net fees and commission income 161 168 4.4% 108 113 4.5% 53 55 4.1% 39 41 7.2% 8 7 -6.2% 6 6 -2.3%

Other operating income -15 -29 -91.8% 5 -3 <-100% -21 -26 -26.3% -22 -26 -20.1% 1 0 -78.0% 0 0 -0.6%

B asic inco me 478 484 1.2% 308 302 -1.9% 170 182 6.7% 108 118 9.0% 53 55 4.0% 9 9 -5.7%

Net trading income 36 34 -5.3% 21 19 -9.2% 16 15 -0.1% 12 13 2.8% 2 2 -13.2% 1 1 -5.7%

Equity accounted earnings 20 20 0.9% 12 12 2.1% 8 8 -1.0% 0 0 -- 0 0 -- 8 8 -1.0%

B anking inco me 534 538 0.7% 341 333 -2.2% 193 205 5.8% 120 130 8.4% 55 57 3.3% 18 17 -3.6%

Staff costs 137 142 3.9% 90 91 1.4% 47 51 8.7% 34 38 12.3% 9 9 -3.5% 4 5 6.7%

Other administrative costs 89 90 1.0% 55 53 -2.5% 34 36 6.7% 23 25 8.7% 10 10 1.9% 2 2 7.2%

Depreciation 13 14 11.5% 8 9 12.7% 5 5 9.4% 3 3 5.6% 2 2 17.1% 0 0 -25.0%

Operat ing co sts 238 246 3.2% 153 153 0.6% 86 93 7.9% 59 66 10.6% 21 21 0.8% 6 6 6.6%

Operat ing net inco me bef . imp. 296 292 -1.3% 188 180 -4.5% 108 112 4.1% 61 65 6.2% 35 36 4.8% 12 11 -8.8%

Loans impairment (net of recoveries) 149 106 -28.8% 126 89 -29.4% 23 17 -25.5% 14 12 -18.3% 8 6 -29.0% 0 -1 <-100%

Other impairm. and provisions 54 24 -56.1% 57 19 -66.5% -2 5 >100% 0 1 >100% -2 0 80.3% 0 5 >100%

N et inco me befo re inco me tax 93 162 74.9% 5 72 >100% 87 90 3.4% 47 52 12.2% 29 31 7.4% 11 7 -42.5%

Income tax 19 49 >100% -3 27 >100% 23 22 -3.2% 14 15 7.8% 8 6 -23.3% 1 1 1.1%

Non-contro lling interests 23 27 15.5% 0 0 -81.0% 23 27 15.6% 0 0 -- 0 0 22.4% 23 27 15.6%

Inco me tax 50 86 70.8% 9 44 >100% 41 41 0.1% 33 37 14.1% 21 25 18.9% -12 -21 -69.2%

M illennium bim (M o z.)

Internat io nal o perat io ns

Gro up P o rtugal T o tal B ank M illennium (P o land) Other int . o perat io ns

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85

Glossary (1/2)

Balance sheet impairment – Balance sheet impairment related to amortised cost and fair value adjustments related to loans to customers at fair value

through profit or loss.

Balance sheet customer funds - debt securities and customer deposits.

Capitalisation products – includes unit linked saving products and retirement saving plans (“PPR”, “PPE” and “PPR/E”).

Commercial gap –loans to customers (gross) minus on-balance sheet customer funds.

Core income - net interest income plus net fees and commissions income.

Core net income - corresponding to net interest income plus net fees and commissions income deducted from operating costs.

Cost of risk, gross (expressed in bp) - ratio of impairment charges accounted in the period to loans to customers at amortised cost before impairment.

Cost of risk, net (expressed in bp) - ratio of impairment charges (net of recoveries) accounted in the period to loans to customers at amortised cost before

impairment.

Cost to core income - operating costs divided by core income (net interest income and net fees and commissions income).

Cost to income – operating costs divided by net operating revenues.

Coverage of non-performing loans by balance sheet impairments – BS impairments divided by NPL.

Debt securities - debt securities issued by the Bank and placed with customers.

Dividends from equity instruments - dividends received from investments classified as financial assets at fair value through other comprehensive income and

from financial assets held for trading.

Equity accounted earnings - results appropriated by the Group related to the consolidation of entities where, despite having a significant influence, the

Group does not control the financial and operational policies.

Loans to customers (gross) – Loans to customers at amortised cost before impairment and loans to customers at fair value through profit or loss before fair

value adjustments.

Loans to customers (net) - Loans to customers at amortised cost net of impairment and balance sheet amount of loans to customers at fair value through

profit or loss.

Loan to Deposits ratio (LTD) – Loans to customers (net) divided by total customer deposits.

Loan to value ratio (LTV) – Mortgage amount divided by the appraised value of property.

Net commissions - net fees and commissions income.

Net interest margin (NIM) - net interest income for the period as a percentage of average interest earning assets.

Net operating revenues - net interest income, dividends from equity instruments, net commissions, net trading income, equity accounted earnings and other

net operating income.

Net trading income - net gains/losses arising from trading and hedging activities, net gains/losses arising from financial assets at fair value through other

comprehensive income and financial assets at amortised cost.

Non-performing exposures (NPE, according to EBA definition) – Non-performing loans and advances to customers more than 90 days past-due or unlikely to

be paid without collateral realisation, even if they recognised as defaulted or impaired.

Non-performing loans (NPL) – Overdue loans more than 90 days including the non-overdue remaining principal of loans, i.e. portion in arrears, plus non-

overdue remaining principal.

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Glossary (2/2)

Operating costs - staff costs, other administrative costs and depreciation.

Other impairment and provisions - other financial assets impairment, other assets impairment, in particular provision charges related to assets received as

payment in kind not fully covered by collateral, goodwill impairment and other provisions.

Other net income – net commissions, net trading income, other net operating income, dividends from equity instruments and equity accounted earnings.

Other net operating income – net gains from insurance activity, other operating income/(loss) and gains/(losses) arising from sales of subsidiaries and other

assets.

Overdue loans - loans in arrears, including principal and interests.

Overdue loans by more than 90 days coverage ratio - BS impairments divided by total amount of overdue loans including installments of capital and interest

overdue more than 90 days.

Overdue loans coverage ratio – BS impairments divided by total amount of overdue loans including installments of capital and interest overdue.

Return on average assets (Instruction from the Bank of Portugal no. 16/2004) – Net income (before tax) divided by the average total assets.

Return on average assets (ROA) – Net income (before minority interests) divided by the average total assets.

Return on equity (Instruction from the Bank of Portugal no. 16/2004) – Net income (before tax) divided by the average attributable equity + non-

controlling interests.

Return on equity (ROE) – Net income (after minority interests) divided by the average attributable equity, deducted from preference shares and other

capital instruments.

Securities portfolio - financial assets held for trading, financial assets not held for trading mandatorily at fair value through profit or loss, financial assets at

fair value through other comprehensive income, assets with repurchase agreement, other financial assets at amortised cost and other financial assets

held for trading at fair value through profit or loss.

Spread - increase (in percentage points) to the index used by the Bank in loans granting or fund raising.

Total customer funds - balance sheet customer funds, capitalisation products, assets under management and investment funds.

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87

Agenda

Macro and Business Overview

Strategic Plan 2013-2018

3M2018 earnings

Other information

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88

3.9 +0.2

+0.2

+1.2

+0.8 6.3

NPLs >90d

Cross- default

Quaran -tine*

LLR/gross loans>20% or LLR>€5mn

Other triggers

NPEs

The NPE reduction plan is being implemented Reconciliation of NPLs>90d with NPEs (EBA definition)

NPEs down €6.5 billion from end-2013 NPLs>90d vs NPEs (EBA definition)

(Billion euros, March 2018)

* 9 months following payment is resumed for loans to companies, 3 months for retail loans.

(Billion euros)

-2.1

-3.0

-1.4

12.8

6.3

Dec13 Net new entries

Write offs

Sales Dec17

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89

Latest Rating Actions recognized the progress made by

BCP in implementing its strategic plan

+3 notches +3 notches

+2 notches

S&P Stand-alone credit profile (SACP)

Fitch Viability Rating (VR)

Moody’s Baseline Credit Assessment (BCA)

BB-

B+

B

B-

2013 2014 2015 2016 2017

b2

b3

Caa1

Caa2

2013 2014 2015 2016 2017

bb-

b+

b

2013 2014 2015 2016 2017

Rating Agencies have recognized the progress achieved

by Millennium bcp since 2013

Excluding the effect of Government support removal

due to change in Rating Agencies methodology in order

to adjust for the BRRD, the intrinsic rate of BCP was

upgraded by 3 notches by S&P and Moody’s and by 2

notches by Fitch

Future upgrades of the Portuguese Republic rating

should provide room for an upgrade of BCP ratings

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90

Ratings

Moody's Standard & Poor's

Intrinsic Baseline Credit Assessment

Adjusted Baseline Credit Assessment

b2

B2

Stand-alone credit profile (SACP) bb-

LT/ST

Counterparty LT/ST

Deposits LT/ST

Senior unsecured LT/ST

Outlook deposits / senior

Ba1 / NP

B1 / NP

B1 / NP

Positive

Counterparty Credit Rating LT/ST

Senior Unsecured LT/ST

Outlook

BB-/ B

BB-/ B

Positive

Other

Subordinated Debt - MTN

Preference Shares

Other short term debt

Covered Bonds

(P) B3

Caa2 (hyb)

P (NP)

A2

Subordinated debt

Preference shares

B-

CCC

Fitch Ratings DBRS

Intrinsic

Viability Rating

Support

Support floor

bb- Intrinsic

Critical obligations

BB (high)

BBB/R-2(high) 5

No floor

LT/ST

Deposits LT/ST

Senior unsecured debt issues LT/ST

Outlook

BB- / B

BB- / B

Positive

Deposits LT / ST

Short-Term Debt LT / ST

Trend

BB (high) / R-3

BB (high) / R-3

Positive

Other

Subordinated Debt Lower Tier 2

Preference Shares

Covered Bonds

B+

B-

BBB+

Dated Subordinated Notes

Covered Bonds

BB (low)

A

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91

Progress recognised by the market

CDS 5 yr Portuguese Republic

CDS BCP yield curve (senior)

CDS 5 yr BCP

BCP CDS spreads have narrowed since the end of 2016

and after the completion of the share capital increase in

February 2017 but reflect also the progress made by the

Bank in reducing NPEs as well as the increase in NPEs

coverage

Besides this BCP’s intrinsic factors the BCP CDS spreads

benefitted also from the decrease in Portuguese

Republic CDS spreads

Spreads on senior preferred debt have also narrowed in

recent months because there was the introduction of a

new debt class in the Iberian markets: the senior non

preferred debt

0

200

400

600

800

1 2 3 4 5 6 7 8 9 10

1 year ago

As at March,

31

b.p.

b.p. b.p.

(Years)

0

150

300

450

Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 0

200

400

600

800

1000

Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17

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92

New Senior Bond, CB and Subordinated issues signal

Millennium bcp’s return to capital debt markets

Issuer: Banco Comercial Português, S.A.

Issue Rating (M/F/D): A3/BBB+/A

Issue type: Mortgage Bonds

Amount: € 1,000m

Issue date: 23 May 2017

Settlement date: 31 May 2017

Maturity: 31 May 2022

Coupon: 0.750 %

Spread: MS+65bps

Re-offer yield: 0.876 %

Listing / ISIN: Irish Stock Exchange / PTBCPIOM0057

Asset Managers

45%

Central Banks & Official

Institutions 29%

Banks 21%

Insurance & Pension Funds

5%

Portugal 36%

Germany & Austria

25%

Spain 10%

France 10%

Benelux 7%

UK & Ireland

4%

Switzerl. 3%

Italy 3%

Other 2%

3 Yr Senior Unsecured Notes Breakdown by Investor Type and Geography

Breakdown by Investor Type and Geography 5 Yr Covered Bond Issue

Investment Funds 60%

Banks 16%

Hedge Funds 12%

Insurance and Pension Funds 10%

Other 2%

UK 33%

Portugal 20%

Italy 15%

France 11%

Deutschland 6%

Austria 6%

Spain 5%

Switzerland 4%

Issuer: Banco Comercial Português, S.A.

Issue Rating (S/M/F/D): B (Neg.) / B1 (Neg.) / BB- (Neg.) / BBBL (Neg.)

Issue type: Senior Unsecured Unsubordinated

Amount: € 500m

Issue date: 19 February 2014

Settlement date: 27 February 2014

Maturity: 27 February 2017

Coupon: 3.375 %

Spread: MS+285bps

Re-offer yield: 3.422 %

Listing / ISIN: London Stock Exchange / PTBITIOM0057

Breakdown by Investor Type and Geography 5 Yr subordinated Debt Issue

Issuer: Banco Comercial Português, S.A.

Issue Rating (M/S/F/D): B3/B-/B+/BB(L)

Amount: € 300mm

Issue date: 7 December 2017

Maturity: 7 December 2027

Issuer’s Call: 7 December 2022, subject to the prior approval of the

Relevant Authority

Coupon: 4.50 % (Fixed, Annual) until 7th December 2022. One time

reset year 5 to prevailing 5Y MS + 4.267% (initial margin)

Re-offer price: 100%

Listing / ISIN: Irish Stock Exchange / PTBCPWOM0034

Asset Manager

48% Hedge

Fund 37%

Bank & Private

Bank 11%

Insurance & Pension

5%

UK & Ireland 43%

Iberia 17%

Germany, Austria &

Switzerland 15%

FraBeLux 13%

Asia 5%

Other 4% Italy 3%

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93