UNICREDITO ITALIANO GROUP 9M 2004 Results Alessandro Profumo - CEO

UNICREDITO ITALIANO GROUP9M 2004 Results

Alessandro Profumo - CEO

Milan - November, 12nd 2004

2

AGENDA

9M04 Group Highlights

Divisional Reporting

Retail Division

Corporate Division

Private & AM Division

New Europe Division

3

3Q EXECUTIVE SUMMARY: QUALITY DRIVING GROUP RESULTS

Continuous growth of lending activity (+1.5% q/q and +10.4% y/y ex. Repos), with market share improvement in Italy (10.96% as of Sep 04, +8 bp vs. Jun 04)

Growth of managed assets (+7.7% y/y) with increased market shares in Italy (13.69% as of Oct 04, +18 bp vs. Jun 04) and Poland (32.68% as of Sep 04, +43bp vs. Jun 04)

Evidence of improvement in revenue quality:

Good growth of net interest income from Italian commercial business (+3.2% q/q, +6.8% y/y)

Recurring net commissions resilience (net of adverse seasonal effects)

Estimated Core Tier 1 ratio at 7.6%, vs. 7.4% in 1H04… 67.5 mln shares purchased to date

Better coverage ratios on total doubtful loans (48.0%, +86 bp vs. Jun 04) and NPLs (60.1%, +87 bp vs. Jun 04), with annualised cost of risk at 65 bp (stable vs. FY2003 net of Parmalat)

4

449

3Q03

1,130

3Q03

1,581 1,504

9M03 9M04

NET INCOME (Euro mln)

ROE1

1 Calculated on end of period net equity excluding profit for the period

3,680 3,310

9M03 9M04

OPERATING INCOME (Euro mln)

COST/INCOME RATIO

-4.9%

-10.1%57.0%

(+2.0 pp on Dec03)

16.7% (-1.0 pp on Dec03)455

3Q04

+1.3%

1,030

583

2Q04

1,210

2Q04 3Q04-8.8%

466

1Q04

1,070

1Q04

GROWING NET INCOME Y/Y (+1.3% ON 3Q03). Q/Q COMPARISON AFFECTED BY NEGATIVE SEASONAL EFFECT

5

STRONG NET INTEREST INCOME (EX. DIV.) COMING FROM COMMERCIAL BUSINESS (+3.2% Q/Q AND +6.8% Y/Y IN ITALY), THANKS TO PRICING RESILIENCE …

NET INTEREST INCOME excl. Dividends

4Q03 1Q043Q032Q031Q03

New Europe

Italy ex. Parent Company

Avg. Euribor 2.46%

2.78%

2.14% 2.09%2.16%

2Q04

2.09%

Mark-up on short term(1) UBI vs. System(3), %

Mark-down(2) UCB vs. System(3), %

(1) Mark-up = Interest rate on short term loans - Euribor 1M. EOP data(2) Mark-down = Euribor 1M - Interest rate on deposits in current accounts. EOP data

ITALY: TREND OF MARK-UP& MARK-DOWN

1,140 1,1891,1601,1931,251

933 9649469701,007

1,210

979

255 259250268263 270

3Q04

2.11%

1,217

1,010

274

1,63

1,441,20

1,40

1,60

1,80

2,00

2,20

mar 03 jun 03 sep 03 dec 03 mar 04 jun 04 sep 04

UCB Mark-down System Mark-down

3,73

3,64

3,20

3,40

3,60

3,80

4,00

mar 03 jun 03 sep 03 dec 03 mar 04 jun 04 sep 04

UBI Mark-up System Mark-up

MemoParent Company:

-48 -34-36-45-19 -39 -67

(3) System data as of end of August 2004

Net Interest income

82 04771 91 34Dividends(4)

(4) Excl. infra-group dividends

+3.2%

+6.8%

34 -34-3232-18 52 -33Parent Co. subtotal

6

% ch. on Dec03

% ch. on Jun04

… AND GOOD VOLUME GROWTH MAINLY SUPPORTED BY RETAIL AND NEW EUROPE IN 3Q04

Sep04

TOTAL CUSTOMER LOANS1

Breakdown By Division (bn)

1 Excl. Repos

Retail Division: good performance, thanks to continued growth in households’ mortgages (+16.1% on Dec03) and to the pick-up of Small Business lending (+7.2% on Dec03)

Corporate Division substantially stable (-0.3% on Dec03) mainly due to lower lending to large corporates counterbalanced by growth in SMEs and other corporate customers; good increase in m/l term (+9.2%2 Sep04/Dec03 in UBI)

New Europe Division up 8.0% at unchanged FX on Dec03, positive contribution of Pekao (+11.1% on Dec03, +3.5% at unchanged FX)

+4.1

Retail +11.2

Corporate -0.3

New Europe +12.0

TOTAL GROUP +5.7

Other

54.2

62.6

13.2

133.2

3.2

+3.4

-0.6

+1.5

+0.9 +22.4

+15.0

+7.5

+9.1

+10.4

+0.6

% ch. on Sep033

2 Source: Bank of Italy Matrix 3 Incl. ANBI

7

UCI LOAN GROWTH IN ITALY OUTPERFORMS INDUSTRY WITH A MAJOR SHIFT TOWARDS M/L TERM CONTINUED MARKET SHARE GAINS

Italian industry

Total Loans1, y/y % ch.

UCI2 Italian industry

Medium/Long Term Loans1, y/y % ch.

UCI 2

On M/L term loans 1On total loans 1

UCI2 Market Share Increasing positive gap of UCI y/y total

loans growth vs. industry since Sep 03 (from +0.8% in Sep 03 to +6.2% in Sep04)

UCI total loans market share constantly improving from Mar03 (+97 bp, from 9,99% in Mar03 to 10,96% in Sep04)

1Source: Bank of Italy Matrix (Total Loans net of NPLs and Repos)

2 Proforma incl. ANBI

5.3%5.6%

4.9%

6.0%7.2%

6.2%6.2%

11.5%

12.0%

4.6%

2.1%

13.3%

12.1%

8.0%

0%

2%

4%

6%

8%

10%

12%

14%

Mar-03 Jun-03 Sep-03 Dec-03 Mar-04 Jun-04 Sep-04

12.1%

13.8%13.7%13.0%

13.6%

11.4%11.3%

17.8%17.3%

16.6%

14.7%

12.2%

11.3%

9.4%8%

10%

12%

14%

16%

18%

20%


10.96%10.88%

10.79%

10.74%

10.35%

10.26%

9.99%

11.11%11.03%

10.74%

10.80%

10.58%10.70%

10.48%


8

Net commissions (excluding up-front) down 7.9% on 2Q mainly due to lower contribution from Corporate Division:

Less fees from Corporate Finance activity (~ -25 mln)

Adverse seasonal effect on Uniriscossioni

Good resilience of fees from Foreign Trade and Transaction Services vs. 2Q

Commissions from segregated accounts up 3.3% on 2Q04

Up-front fees down 25.9% on 2Q

Net commissions (excluding up front) up 0.7% on 3Q03 with further improvement in net commission mix (weight of up-front on total to 10.8% from 18.2% in 3Q03)

1 Related to UniCredit Banca and UniCredit Private Banking data restated on management accounts

RECURRING NET COMMISSIONS UP 0.7% Y/Y Q/Q COMPARISON IMPACTED BY ADVERSE SEASONAL EFFECT

NET COMMISSIONS

781

1Q03

798

1Q04

839

2Q03

830

3Q03

857

4Q03

Up-front1 109154 171151179

Other627 660 679 686 689

855

2Q04

743

9M04/9M03: -1.2%

Weight of Up-front on Total (%)

19.7 21.3 18.2 20.0 13.6 13.1

767

3Q04

684

-10.3%

-7.9%

10.8

83112

+0.7%

9

Sep. 04

41.4

23.9

23.1

34.8

123.2

Jun. 04

42.9

22.6

22.6

35.0

123.1

(1) Plain vanilla Mutual and Hedge Funds distributed in Italy (Total AuM in Mutual and Hedge Funds in Italy, including Mutual Funds in Segregated Accounts and Unit Linked, 70.2 bn as at 30.9.2004 vs 67.6 bn as at 30.9.2003, +3.8% - Source: Assogestioni)

MUTUAL FUNDS (Italy): continued outperformance for net sales in the first 10 months of 2004 …

HEDGE FUNDS (Worldwide): positive inflows confirmed in 3Q (~260 mln), leading to record 1.4 bn net sales in 9M04 (+217% Y/Y)

TOTAL AUMs IN LINE WITH JUN04 BUT +7.7% Y/Y; VERY POSITIVE Q/Q GROWTH OF HIGHER VALUE ADDED PRODUCTS (SEGREGATED ACCOUNTS +5.8% AND BANCASSURANCE +2.0%) AND CONTINUED INCREASE OF MKT. SHARE IN MUTUAL FUNDS

Focus on Sales of AM products

DEC.03

… being the only mkt. share net gainer among the big players

UCI

JUN.04 SEP.04

13.39% 13.51% 13.63%

UCI TOTAL AUM(bn)

Italy US, New Europe & Intl.

Mutual & Hedge Funds1

Segregated Accounts

Insurance

Sep. 03

+3.3% vs Sep. 03

42.0

24.1

19.5

28.8

114.4

+21.3%

+7.6%

+16.2%

-6.2%

+2.1%

-0.5%

+0.1%

+2.0%

+5.8%

-3.5%

+20.7% vs Sep. 03

+7.7% vs Sep. 03

ASSET MIX (PGAM)

Avg.9M03

Equity + Hedge

Avg.1Q04 Avg.2Q04

26.7% 29.8% 30.0%

Bond + Liquidity 63.0% 60.7% 60.9%

Balanced + others 10.3% 9.5% 9.1%

UCI (Total)

ITALIANSYSTEM

-9,952

-583

OCT.04

13.69%

US, New Europe & International

Avg.3Q04

30.1%

61.3%

8.6%

10

60

66

66

Negative seasonality penalising both Corporate (i.e. less than 10 mln revenues in August) and Institutional Derivatives (i.e. less than 4 mln revenues in August)

INCOME FROM FINANCIAL TRANSACTIONS(mln)

4Q031Q03 2Q03 3Q03

Corporate Derivatives

Institutional Derivatives1

436

268

349

204

263

105

65

239

97

292

1Q04

105

68

2Q04

295

139

100

Reduction of the Y/Y gap vs 2003 for Corporate Derivatives (-44% as of Sep.04 vs -48% as of Jun.04) …

Higher 3Q/2Q contribution of Retail Derivatives, New Europe and Parent Company

3Q04

233

76

50

(1) Data restated: revenues deriving from structured products distributed through non-captive networks (previously classified as Retail Derivatives) now classified as Institutional Derivatives

… and +10.6% Y/Y growth for Institutional Derivatives in 9M04 (~218 mln vs ~197 mln)

INCOME FROM FINANCIAL TRANSACTIONS: CONTINUOUS REDUCTION OF THE Y/Y GAP VS 2003 (FROM –25% AS OF JUNE TO –22% AS OF SEPTEMBER), DESPITE THE NEGATIVE SEASONALITY AFFECTING CORPORATE AND INSTITUTIONAL DERIVATIVES

9M03: 1,048 mln 9M04: 820 mln (-21.8% Y/Y)

11

OPERATING COSTS DOWN BY 2.8% 3Q/2Q04 MAINLY THANKS TO A DECREASE IN OTHER ADMINISTRATIVE EXPENSES.FIRST HEADCOUNT REDUCTION SINCE SEP03

OPERATING COSTS BREAKDOWN(Euro mln)

PERSONNEL COSTS 3Q/2Q decreasing by -1.4%. First signs of headcount reduction

OTHER ADMIN. EXPENSES 3Q/2Q -7.1% also thanks to a seasonal reduction of advertising costs (-10 mln)

Personnel costs

9M03 9M04

4,225

2,446

+0.6%

+5.3%

+3.4% 2,529

1,439

340

Other adm. expenses

Depr. & amort.

4,386

1,515

342

3Q04

1,505

852

-2.8%

+7.0%

-7.1%

-1.4%840

539

114

1,463

501

122

2Q04

+3.8%

DEPRECIATION 3Q/2Q +7.0% mainly due to UCB (+3.6 mln for new branch layout, replacement ATM)

3Q04

69,248

-112

69,136

2Q04

Headcount reduction 3Q/2Q

12

NON OPERATING ITEMS IN 3Q CHARACTERISED BY LOWER NET WRITE-DOWNS OF LOANS AND NET EXTRAORDINARY INCOME vs. 2Q

Operating income

Goodwill amort.

Net Income

Net write-downs of loans

Other net provisions1

Net extraord. income

Taxes

Minorities

1Q04

1,070

-71

466

-192

-9

2

-296

-38

2Q04

1,210

-72

583

-246

-27

100

-335

-47

3,310

-215

1,504

9M04

-660

-58

157

-895

-135 Tax Rate at 34.3% vs. 41.7% in 3Q03 benefiting from tax calculation on consolidated P&L, substantially stable on 2Q04 (34.6%)

-222 mln net write-downs of loans down 24 mln vs. 2Q04 due to lower net write-downs in Corporate division -21 mln and in Retail division -4 mln

Net write-downs of financial investments +4 mln

Provisions for risks & charges -26 mln

15 mln net capital gains from disposals 23 mln release of reserves previously

created

1 Net write-downs of financial investments, provisions for risks and charges and provision to reserve for general banking risks

3Q04

1,030

-72

455

-222

-22

55

-264

-50

13

Coverage ratio 60.1% +87 bp

Provisions on performing loans 1,328 +2.9%


Gross Doubtful Loans 9,311 +1.4%


Stated cost of risk (annualised) 65 bp +1 bp4

Weight on Gross Loans 6.60% -1 bp

mln, where not specified

Gross Non Performing Loans 6,451 +3.1%

Weight on Gross Loans 4.57% +6 bp

(4) Calculated on FY03 cost of risk (76 bp) net of extraordinary provisions on Parmalat (12 bp)

9M04ch. on 2003

Sep. 04ch. on

Jun. 04

ASSET QUALITY: LIMITED Q/Q GROWTH OF GROSS DOUBTFUL LOANS AND SUBSTANTIAL INCREASE OF COVERAGE RATIOS

(2) Defined as: Flow from performing loans to any category of doubtful loans less Flow-back from any category of doubtful loans to performing(3) Calculated adding back to total provisions the fiscal write-offs of UniCredit Banca and UniCredit Banca d’Impresa only

3Q04

507402

-20.6%

3Q net flows of New Doubtful Loans2 slightly higher than 2Q (402 mln vs 372) but 20.6% lower than first 2 quarters Average

3.1% increase of Gross NPLs vs Jun. 04 (mainly due to shift from Watchlist Loans) partly offset by a 3.7% reduction of Watchlist Loans (2,412 mln as of Sep. vs 2,506 mln as of Jun.)

Improved coverage ratios; coverage ratios adding back fiscal write-offs3 at a high 70.6% on NPLs (+62 bp Q/Q) and at 58.4% on Total Doubtful Loans (+88 bp Q/Q)

2.9% increase of provision on performing loans vs Jun. 04, with coverage ratio at 1.01%

30.6.200430.9.2003 30.9.2004

3.20%3.09% 3.14%

4.60%4.78% 4.84% Italian Banking

System

Weight of Total Gross NPLs1 on Total Gross Loans in Italy much lower than for the Italian Banking System

(1) Calculated as Total Gross NPLs/Total Gross Customers Loans granted to corporate and retail customers residents in Italy (Source: BankIT data)

Average 1Q04 + 2Q04

(ex New Europe)

14



Retail Division

Corporate Division


New Europe Division

AGENDA

15

RETAIL DIVISION: GOOD Q/Q PERFORMANCE, WITH TOTAL REVENUES UP 3.2% THANKS TO GROWTH OF NET INTEREST INCOME (+4% EX. DIV.) AND NET COMMISSIONS (+1.5%)

3Q04

Net interest income (incl. div.)

Net non interest income

Total revenues

Operating costs (incl. depr.)

Operating income

Net income for the Group

Cost Income ratio, %

605

487

1,092

-747

345

161

68.4

% ch. on 2Q04

+4.5

+1.6

+3.2

-0.2

+11.3

+23.2

-232 bp

9M04ch. on FY03

Cost of risk 49 bp -1 bp

Good growth of net interest income (+6.5% y/y excl. dividends) sustained by volume growth in all segments

Spread on deposits(1) at 1.57%, slightly up vs. 2Q04 (+2 bp)

Good performance of commissions (+1.5% vs. 2Q04 despite negative seasonal effects), thanks to excellent sales of Focus Invest (the new investment product for affluent customers launched in July)

Good increase of Operating Income (+11.3% q/q), resulting from operating costs substantially aligned with 2Q

Almost 19,000 net new customers acquired in 3Q04

(1) Management accounts

Decrease of 200 employees in 3Q

16

POSITIVE SIGNS FROM ALL KEY MARKETS WITH GROWTH TARGETS: EXCELLENT GROWTH IN STOCKS OF RESIDENTIAL MORTGAGES, CONSUMER FINANCING …

RESIDENTIAL MORTGAGESSTOCK, bn NEW FLOWS, bn

Good performance in the flow of new mortgages of both UCB and UBCasa (+22% y/y for both)

Growth coming mainly from partnership channel, with 49% y/y increase

Avg. amount of mortgage from 93,000 (2003 avg.) to 102,000 Euros (9M04 avg.), up 12.7%

CONSUMER FINANCING Excellent growth of stock (2.5 bn as of September), +18%

vs. Dec 03 and +9.6% vs. June 04 Excellent results of the focus on captive customers (more

than 200,000 revolving sold in 9 months vs. 6,000 in FY03) Acceleration in flow of personal loans granted through UCB branches (342 mln in 3Q vs. 281 in 2Q) driven by the launch of Credit Express in May 04

DEC03 9M04

26.230.5

+16.1%

9M03 9M04

5.26.3

+22%

NEW FLOWS OF PERSONAL LOANS

FY03 9M04

95 mln

248 mln

TOTAL SPENDING3) (+270k revolving cards in 9M04)

3Q average spread on new mortgages(1) : UCB at 1.28%, unchanged vs. 2Q04 UBCasa at 1.46%, slightly up vs. 2Q04 (+1 bp)

(1) Management accounts

2Q04

29.2

mkt share(2)

17.17%17.61% 17.63%

(2) Related to mortgages to households as of Bank of Italy definition in table TDME0070 of the monthly bulletin

VOLUMES

PRICING

VOLUMES

3Q average spread on new production(1) : revolving cards at 9.87%, +43 bp vs. 2Q04 personal loans at 5.40%, -2 bp vs. 2Q04

PRICING

(3) POS and ATM spending through revolving cards

9M03 9M04

582 mln

886 mln

+52%

17

… AND SMALL BUSINESS LENDING, THANKS TO CONTINUED INCREASE IN CUSTOMER ACQUISITION RATE AND IN PRESENCE OF A RESILIENT SPREAD

STOCK, bn

Growth of acquisition rate mainly driven by development regions, also thanks to the implementation of the brand new network of Developers (680 developers up and running)

9M04DEC03

UCB AVERAGE MONTHLY ACQUISITION RATETOTAL BANK DEVELOPMENT REGIONS STRENGTHENING REGIONS

FY03 3Q04 FY03 3Q04 FY03 3Q04

SHORT TERM SPREAD(1)

FY03 9M04

GOOD RESULTS OF THE RECENT FOCUS ON SMALL BUSINESS ALREADY VISIBLE IN STOCK GROWTH

Continuous growth of stock, with 2.8% increase vs. June 04

Resilience of short term spread(1), substantially in line with 1H04 (+1 bp)

(1) Management accounts, includes also maximum overdraft charges

12.113.0

+7.2%

8.63% 8.41%

0.49%

0.64%

0.70%

0.93%

0.32%

0.46%+31% +33% +44%

52,000 new Small Business customers acquired in 9M04

18



Retail Division

Corporate Division


New Europe Division

AGENDA

19

CORPORATE DIVISION: GOOD PERFORMANCE OF NET INTEREST INCOME, COST CONTROL AND LOWER WRITE-DOWNS ON LOANS OFFSET BY THE NEGATIVE SEASONALITY ON NON-INTEREST INCOME AND THE LACK OF EXTRAORDINARY GAINS POSTED IN 2Q

3Q04



Total revenues


Operating income



388

330

718

-244

474

193

34.0

% ch. on 2Q04

+1.0

-30.7

-16.6

-5.4

-21.4

-37.5

+402 bp

9M04ch. on FY03

Cost of risk (annualised) 77 bp +8 bp1

Good growth of net interest income (+3.7% Q/Q and +5.9% Y/Y excluding dividends) almost totally driven by UBI

Net write-downs on loans -123 -14.5

Net extraordinary income +1 n.s.


(mln)

Net non interest income penalised by the negative seasonality for derivatives (income from financial transactions from 282 mln in 2Q to 178 mln in 3Q) and by the lower contribution of Corporate Finance fees (from ~36 mln in 2Q to ~11 mln in 3Q)

Operating costs decrease (-5.4% 3Q/2Q) mainly due to lower administrative expenses (less services provided to customers due to seasonality and effective cost control)

Net write-downs on loans back to “normalised levels” (-21 mln vs 2Q)

37.5% 3Q/2Q reduction of Net Income also due to very limited extraordinary income (1 mln vs 64 mln posted in 2Q2)

(2) Of which ~55 mln write-back of provisions created for fiscal purposes – “tax cleared accounts” by UBM

20

UBI AVG. CUSTOMER LOANS1, bn

+2.5%

UBI AVG. TOTAL LENDING SPREAD(1), %

2.21% 2.32% 2.41%

(1) Average quarterly figures; only performing loans (“impieghi vivi”) taken into account

NET INTEREST INCOME GROWTH DRIVEN BY UBI’S HIGHER AVERAGE LOANS COUPLED WITH EFFECTIVE PRICING

42.7 45.3 46.5

3Q03 2Q04 3Q04 3Q03 2Q04 3Q04

(mln, end of period figures)

Largest groups

Dec03

7,389

Jun04 Aug042

6,359 5,173

% ch. Aug04/ Jun04

-18.7%

SMEs & other corporate 27,390 28,608 28,663 +0.2%

Public Sect. & Others4 6,811 7,872 8,145 3.5%

(4) Including non-financial companies with Total Revenues lower than 1.5 mln(5) Data as of Dec03 and Jun04 restated in order to reflect

a new share of wallet calculation criteria adopted from July ’04, which excludes loans to non-residents in Italy

Financial companies 4,446 3,478 3,295 -5.3%

TOTAL5 46,036 46,317 45,276 -2.2%

- Share of Wallet 12.3% 12.7% 12.8%3 +10 bp

Continuous growth of loans to core SMEs customers (+0.2% as of Aug042 vs Jun04) …

(3) Discount the securitisation of ~230 mln for Neafidi district bond and ~170 mln loans issued in conjunction with UniCredit Banca MedioCredito. Share of wallet at ~13.0% adding back these amounts

+9 bp

UBI NET INTEREST MARGIN (excluding dividends), mln

293 312 325

3Q03 2Q04 3Q04

o/w: M/L 17.1 19.1 19.7

(2) Source: Credit Bureau; data as of September 2004 not yet available

… and of Share of Wallet (12.8% as of Aug04 vs 12.7% as of Jun04) …

… with a good contribution of M/L lending (from avg. 19.1 bn in 2Q to avg. 19.7 bn in 3Q)

+4.2% Q/Q

+11.0% Y/Y

21

CORPORATE DIVISION: NET COMMISSIONS

SIGNIFICANT RESILIENCE OF LEAST VOLATILE COMPONENTS OF NET COMMISSIONS, DESPITE LOW “AUGUST” BUSINESS VOLUMES. 3Q NET FLOWS OF NEW DOUBTFUL LOANS SIGNIFICANTLY LOWER THAN THE FIRST 2 QUARTERS AVERAGE (-10.5%)

(2) Defined as: Flow from in bonis loans to any category of doubtful loans less Flow-back from any category of doubtful loans to in bonis loans(3) Defined as: (Flows from in bonis loans to any category of doubtful loans less Flow-back from any category of doubtful loans to in bonis loans)/ Total Gross In

Bonis Loans as of 31.12.2003

2Q04

142.9

1Q04

-25.4% vs 2Q

140 131

Net commissions impacted by the lower contribution of Corporate Finance fees1 (~11 mln in 3Q vs ~36 mln in 2Q) and the negative seasonality for UniRiscossioni

~35 mln from foreign trade services (vs ~37 mln in 2Q and ~27 mln in 1Q)

(1) UBI+UBM+Banca MedioCredito

(mln)

CORPORATE DIVISION: NET FLOWS OF NEW DOUBTFUL LOANS2

3Q net flows of new doubtful loans higher than in 2Q (232 mln vs 143 mln), but significantly lower than the first 2 quarters Average (-10.5%)

3Q04

~260~232

Average 1Q04 + 2Q04

-10.5%

(mln)

Of which: To Loans to be Restructured

8172

3Q Default Rate3 at 0.37% (vs 0.42% in the first 2 quarters Average)

179160

3Q04

176

-6.0% vs 1Q

Very good resilience of the least volatile components, despite lower business volumes in August:

~16 mln from transaction services (vs ~17 mln in 2Q and ~16 mln in 1Q)

22



Retail Division

Corporate Division


New Europe Division

AGENDA

23

3Q04



Total revenues


Operating income



24

251

275

-175

100

88

63.6

% ch. on 2Q04

-1.4

-2.9

-2.7

-5.4

+2.3

-4.3

-179 bp

Net extraordinary income 12 +37.0

(mln - % Change at Fixed FX)

Tax Rate, % 19.4

1 Including Repos

PRIVATE & AM DIVISION: OPERATING INCOME INCREASE THANKS TO HIGHER EFFICIENCY; CONTINUED GROWTH OF TOTAL FINANCIAL ASSETS …

Vs 10.3% in 2Q

(bn)

Sep.03 restated

Jun.04

Securities in custody

Direct deposits1

AUM

5.8

22.4

120.4

5.9

24.7

130.1

148.6160.7

Sep.04

6.1

24.7

130.6

161.4

Total Financial Assets: 0.4% Q/Q increase (+9.6% Y/Y at fixed FX), with higher weight of hedge funds (from 1.40% as of Sep.03 to 2.26% as of Jun.04 and to 2.38% as of Sep.04)

+0.4%PRIVATE & AM DIVISION TOTAL FINANCIAL ASSETS

Slight Q/Q decrease (-8 mln at fixed FX), mainly due to lower upfront fees (-6 mln at fixed FX)

Operating income: +2.3% Q/Q thanks to strict cost control (-10 mln Q/Q operating costs at fixed FX, mainly marketing and travel expenses)

Significant +6.9% growth in 9M04 vs 9M03, driven by the strong +9.6% increase of Total Financial Assets (at fixed FX)

Net income: -4.3% Q/Q (at fixed FX) totally due to taxes back to a “normalised” level (one-off benefits in 2Q coming from “first-time fiscal consolidation” of PGAM and Xelion)

Total revenues:

24

… MAINLY THANKS TO PIONEER AUM INCREASE COUPLED WITH POSITIVE SALES IN ALL THE BUSINESS DIVISIONS

Growth of total AUM driven by market performance and positive net sales in all the business divisions, with excellent results in the International (ex Italy) business division and in alternative investments

(bn)

AUM Sep.03 pro-forma

AUM Sep.04

115.6

125.41

9M04 Net Sales

Italy 165

Net Sales breakdown:

International (ex Italy) 1,6701

US 286

New Europe 287

Alternative Invest. 1,385

TOTAL PGAM 2,408

+0.5% Q/Q+0.9%

at fixed FX

Significant increase of market shares in Italy (from 13.39% as of Dec.03 to 13.63% as of Sep.04 and 13.69% as of Oct.04 – Mutual Funds, Assogestioni perimeter) and in Poland (from 30.36% as of Dec.03 to 32.25% as of Jun.04 and 32.68% as of Sep.04 – Investment Funds)

AUM Jun.04

124.7

“Institutional and Third party strategy” already paying off: Institutional+Third Party AUM/Total AUM ratio from 34.7% as of Dec.03 to 35.8% as of Sep.04

+8.4% Y/Y+9.5%

at fixed FX

1 Data gross of ~500 mln AUM withdrawn by an Institutional client in the last days of September and given back to Pioneer (as previously agreed) at the beginning of October

25



Retail Division

Corporate Division


New Europe Division

AGENDA

26

Operating Costs down 2.5% on 2Q04 due to decreasing trend in major banks (Pekao, and Zaba) thanks to active cost management

3Q04 KEY HIGHLIGHTS: NET INCOME UP 18.9% Q/Q THANKS TO REVENUE GROWTH, COST CONTROL AND LOWER COST OF RISK. INCREASING CONTRIBUTION ON OPERATING INCOME OF ZABA AND KFS

Attributable Net Income

3Q04(Euro mln)

113

Total revenues 445

Operating income 210

Cost/Income 52.8%

Cost of Risk3 (annualised) 91 bp

- o/w net interest income2 270

At unchanged FX1

Net write-downs of loans -30

ROE (9M04 data, y/y % ch.)

% ch. on

2Q04

+18.9

+1.8

+7.1

-2.3 pp

-5 bp

+1.6

- o/w net commissions 99 -5.7

-1.1

20.2%

ITAS

2 Excluding dividends

Operating costs -235 -2.5

Total Revenues up 1.8% on 2Q04:Net interest income +1.6% on 2Q04:

KFS (+9.2%) and Bulbank (+4.5%) performance partially counterbalanced by Zaba (-3.0%) and Pekao (-0.2%); +4.8% incl. dividends and other income from equity investments (+9 mln from Istratourist4)

Net commissions -5.7% on 2Q04: decrease in Pekao offsets positive trends of Bulbank, Zaba and KFS mainly due to loan growth

Further reduction of Cost of Risk (-5 bp q/q) and higher coverage of Doubtful loans (to 72.4% from 68.5% in Jun04)

Attributable Net Income up 18.9% also benefiting from disposal of securities and equity investments in Pekao (7 mln)Tax Rate 15.2% +4.3 pp

3 Calculated as Net Loan Loss Provisions of 3Q04 on Net customers Loans at period-end

1 Excluding for KFS (included at current FX)

% ch. on

3Q03

+21.5

+2.8

+3.4

-0.3 pp

-3 bp

+1.3

-7.0

-5.7

+2.2 pp

+2.2

-9.3 pp

4 Company, operating in tourism business, accounted by equity method in Zaba

27

1 Excluding for KFS (included at current FX)

INCREASING NET CUSTOMER LOANS FOR NE BANKS (PEKAO STABLE ON JUN04). TREND IN MUTUAL FUNDS AFFECTED BY LOWER SALES IN POLAND AND CROATIA

ITAS

% ch. on

Jun04

Sep04(Euro mln)

% ch. on

Dec03

Net Customer Loans

- o/w Pekao

Mortgages

+4.1

-0.1

+11.9

+3.2

+8.3 +21.8

13,261

5,750

1,953

- o/w Pekao LC +17.4 +59.5464

- o/w Pekao

Mutual Funds3

+1.1 -1.1

+4.4 +24.4

Deposits +6.8 +6.622,577

10,690

4,431

- o/w Pekao2 +1.3 +13.22,607

NET CUSTOMER LOANS 3Q/2Q04: Good growth (+4.1%) driven by acceleration in Bulbank (+20.5%) and Zaba (+5.4%); further increase in KFS (+3.7%), Pekao substantially stable (-0.1%)

2 PPIM

At unchanged FX1

MORTGAGES continuing good trend: Pekao: market share in new LC mortgages

+1.9 pp on 2Q04 (to 25.5%) Zaba: stock +7.7% on 2Q04, improved

leadership position with 41.6% market share (+40 bp on 2Q04)

MUTUAL FUNDS in PEKAO: Improved market share2: +0.4 pp on 2Q04

(to 32.7%); Further increase of equity and balanced

funds2 to 51.3% (from 50% in 2Q04)

3 New Europe Business Area of Pioneer is included at current FX

DEPOSITS: ~ +430 mln on Jun04 linked to bond

issued by Zaba (total amount 450 mln)

Assets administr. for customers3 +6.3 +12.335,724

28

Annex

29 * Net write-downs of financial investments, provisions for risks and charges,

provisions for possible loan losses and provisions to reserve for general banking risk

3Q04 & 9M04 CONSOLIDATED INCOME STATEMENT

Net extraordinary income


Total revenues

Operating income

Provisions on loans

Administrative costs (incl. depr.)

Other net provisions*

Goodwill depr.

(Euro mln)

Minorities

Taxes

% ch. on 3Q03


- of which Dividends

-8.3

-0.7

+11.8

n.m.

+6.1

-8.8

-9.9

+5.6

+56.1

-23.2

+8.0

% ch. on 2Q04 3Q04

1,215

2,493

-1,463

1,030

-222

55

-22

-72

-50

-264

1,278

61

-12.5

-8.2

-10.1

-45.0

-2.8

-14.9

-15.3

-0.1

+6.5

-21.0

-3.7

-47.9 +165.2

y/y % ch. 9M04

3,898

7,696

-4,386

3,310

-660

157

-58

-215

-135

-895

3,798

182

Net income +1.3455 -22.1 1,504 -4.9

-5.8

-2.6

+17.6

+185.5

+3.8

-10.1

-64.0

+5.4

+32.4

-20.5

+0.8

+11.0

30

Retail Division

Corporate Division

Priv.& AM Division

NE Division

Total Group1

Total revenues+3.2% -16.6% -3.5% +2.4% -8.2%

Operating costs

Operating income



C/I Ratio

-0.2% -5.4% -6.4% -2.1% -2.8%

+11.3% -21.4% +2.0% +8.0% -14.9%

-5.1% -14.5% n.m. -1.1% -10.1%

+23.2% -37.5% -4.3% +19.9% -22.1%

-2.3 pp +4.0 pp -2.0 pp -2.4 pp +3.3 pp

1 Balance due to the Parent Company, other Group companies and elisions

2 Calculated on data at end of period FX

(Euro mln - Data at end of period FX)

DIVISIONAL CONTRIBUTION TO CONSOLIDATED RESULTS IN 3Q04

1,092 718 275 454 2,493

-747 -244 -175 -240 -1,463

345 474 100 214 1,030

-69 -123 -1 -31 -222

161 193 88 115 455

68.4% 34.0% 63.6% 52.8% 58.7%

3 Including all the employees of Koc Financial Services (3,908 as at 30.09.2004)

Employees3 25,261 6,388 3,667 29,787 71,110

3Q04 RESULTS

% Change vs 2Q042

% Change vs 2Q042

% Change vs 2Q042

% Change vs 2Q042

% Change vs 2Q042

Change in pp vs 2Q042

31

-on tot. Gross doubtful loans, % 37.6% 37.1% 47.2%68.5%37.9% 36.5% 72.4% 48.0%

-on total gross NPL, % 48.5% 42.0% 83.2% 59.3%48.7% 42.6% 84.5% 60.1%

Total gross doubtful loans 3,390 2,798 2,837 9,180-1.1% +1.4%

Net Doubtful Loans/Tot. Net Loans,% 3.64%4.03% 2.71% 7.03%

3,479

3.98%

+2.6% +2.5%2,869

2.82%

2,806

5.83%

9, 311

3.58%

% change on Jun.04

Gross Doubtful Loans/Tot. Gr. Loans,% 6.61%6.28% 4.19% 19.1%6.23% 4.32% 18.1% 6.60%

Total net doubtful loans 2,114 1,760 895 4,850-13.6% -0.2%

2,160+2.2% +3.6%

1,823 774 4,839% change on Jun.04

ASSET QUALITY: DETAILS BY DIVISIONS

Coverage ratios

Retail Division

Jun. 04 Sep. 04

1 Balance due to other Group companies

(mln - Data at end of period FX)Corporate Division

NE Division Total Group 1

Gross NPL

% change on Jun.04

Gross NPL/Tot. Gr. Loans,%

Net NPL/Tot. Net Loans,%

2,034 1,8902,23

66,259

+3.7% +3.1%

3.77% 2.83% 15.0% 4.51%

2.00% 1.69% 2.95% 1.91%

2,095

3.75%

1.98%

+3.0% +2.6%

1,940

2.92%

1.72%

2,320

15.0%

2.71%

6,451

4.57%

1.91%

Net NPL

% change on Jun.04

1,047 1,096 375 2,549

-4.3% +1.1%

1,075

+2.7% +1.6%

1,113 359 2,577

Jun. 04 Sep. 04 Jun. 04 Sep. 04 Jun. 04 Sep. 04

32

Interest income (incl. div.)


Total revenues

Operating costs (incl. dep.)

Net operating income

Net income

Cost/income ratio, %

TOTAL(1)Banca d. Umbria

UniCredit Banca

Net provisions

mln

Net income for the Group(2)

UBCasa

- of which: Staff costs

- of which: Other costs

Clarima

RETAIL DIVISION: 9M04 RESULTS BREAKDOWN BY COMPANY

- o/w: Net write-down of loans

1,505

1,317

2,821

-2,012

809

359

71.3

309

-1,071

-875

-156

-179

78

54

132

-73

59

30

55.0

28

-38

-32

-7

-10

83

9

92

-55

37

17

59.8

22

-18

-35

-12

-12

80

24

104

-48

55

29

46.7

29

-13

-34

-21

-23

1,746

1,420

3,166

-2,215

951

420

70.0

419

-1,155

-987

-197

-225

(1) Balance due to rounding and elisions of infragroup dividends and goodwill amortisation

CR Carpi

28

17

45

-26

19

10

58.1

10

-14

-11

-1

-1

(2) Net of consolidation adjustments

33

CUSTOMER LOANS AND CUSTOMER DEPOSITS BREAKDOWN AND DETAILS OF SHORT TERM SPREADS

SB loans (1)

Residential mortgages (2)

Cons. creditOther loans

EOP LOANS, Euro bn

UCB AVG. MARK UP(5) (Households), %

Other deposits

Households c/accounts

Bonds

EOP DEPOSITS, Euro bn UCB AVG. MARK-DOWN(5) (Households), %

2Q042003pro-forma(3)

2Q042003

+3.4%

-0.2%

(1) Includes short term and m/l term loans(2) Includes only households mortgages(3) Including ANBI

+11.0%

+4.2%

+7.8%

+0.6%

+18.3%

+0.4%

+1.6%

48.8

26.3

12.1

2.18.3

60.2

17.7

15.3

27.2

UCB AVG. MARK UP(5) (Small Business), %

1Q03

7.18

1Q03

2.32

1Q03

5.99

2Q03

7.18

2Q03

2.03

2Q03

5.93

3Q03

7.33

3Q03

1.78

3Q03

5.95

4Q03

7.04

4Q03

1.72

4Q03

5.69

1Q04

7.03

1Q04

1.65

1Q04

5.60

(4) 2Q04 increase vs. December is due to the issue of bonds by UBCasa to fund mortgage book expansion

3Q04

3Q04

54.2

63.8

30.5

20.5(4)

13.0

2.58.2

15.4

27.9

+7.4%

+4.7%

+2.8%

+9.6%

-1.6%

-2.3%

+0.1%

+1.2%

+6.5%

2Q04

7.08

2Q04

1.65

2Q04

5.47

(5) Source: Bank of Italy matrix data

52.4

63.9

29.2

21.0(4)

12.6

2.38.3

15.4

27.6

3Q04

7.33

3Q04

1.67

3Q04

5.55

34

NET COMMISSIONS GROWTH COMING FROM GOOD SALES OF FOCUS INVEST. UP-FRONT FEES REPRESENTING 22% OF TOTAL COMMISSIONS IN 9M04, IN LINE WITH INTERNAL EXPECTATIONS

RETAIL DIVISION: NET COMMISSIONS

mln

Securities in custody

TOTAL RETAIL DIVISION

Total Commissions from Wealth Management

- Mutual funds 1

- Segregated Accounts 2

Other services

- Insurance Products 3

Breakdown by nature

1 Includes subscription and management fees from Plain Vanilla Mutual Funds2 Includes management fees related to underlying Mutual Funds. Net commissions related to Focus Invest do no impact consolidated results

3Q04

49

329

159

50

44

121

66

Q/q% ch.

+1.7

+1.5

+5.1

-10.4

n.m.

-3.0

-22.9

2Q04

48

324

151

56

11

125

85

3 Includes management fees related to underlying Mutual Funds

35

RETAIL DIVISION - DETAILS ON ASSET QUALITY

Slight increase of Gross Doubtful Loans (+2.6% Q/Q), driven by increased Gross NPLs (+3.0%)


Sep 04

ch. on Jun 04

Provisions on performing loans 302 +5.0%








Cost of risk (annualised) 49 bp -1 bp

Increased provisions on performing loans, with slight increase in coverage ratio (+1 bp)

Cost of risk in line with previous year

9M04ch. on 2003

Reduced weight of both Gross Doubtful Loans and Gross NPLs on Total Gross Loans, respectively -5 bp and -2 bp

(1) Defined as flow from in bonis loans to any category of doutbtful loans - flow from any category of doubtful loans to in bonis loans

Increased coverage ratios, both on Doubtful Loans (+28 bp) and on Non Performing Loans (+15 bp)

3Q04

206178

-13.5%

2Q04

240

1Q04

3Q net flows of New Doubtful Loans2 decline vs. previous 2 quarters:

36

GOOD CUSTOMER SATISFACTION IMPROVEMENTS IN PRIVATE AND SMALL BUSINESS SEGMENTS, CONSISTENTLY OUTPERFORMING COMPETITION IN A CONTEXT OF GROWING MARKET SHARES

PRIVATE CUSTOMERS, TRIM INDEX (1)

2003 3Q04

4749

2003 3Q04

4342

UNICREDIT BANCA AVG. TOP 4 COMPETITORS

Stability of front-end relationship with customers

Improved waiting time (shorter queues) Improved advisory on investment services,

with room for further improvement

SMALL BUSINESS, TRIM INDEX (1)

2003 3Q04

42

49

2003 3Q04

4141

UNICREDIT BANCA AVG. TOP 4 COMPETITORS

Dedicated service model

Improved advisory on lending products

Focus on quality of sales

Source: NFO Infratest, Customer satisfaction analyses

(1) On a scale from 0 to 70

37

CORPORATE DIVISION: 9M04 INCOME STATEMENT- BREAKDOWN BY COMPANY

Interest margin (incl. div.)


Total revenues



Net income

TOTAL1UBI

Net provisions

(Euro mln)

Net income for the group


- of which: Other admin. expenses

Other companies

- o/w: Net write-downs of loans

961

428

1,389

993

-169

-226

-396

371

361

28.5%Cost/income Ratio

-350

-355

UBM LOCAT

-17

588

571

404

-72

-84

-167

282

284

29.2%

7

3

152

16

168

128

-15

-23

-40

58

61

23.7%

-25

-27

43

169

212

69

-92

-66

-143

36

40

67.7%

-5

-8

1,139

1,201

2,340

1,594

-328

-399

-746

747

746

31.9%

-373

-387

1 Balance due to roundings and elisions of infragroup dividends and goodwill amortisation

38

CORPORATE DIVISION: 3Q04 AND 9M04 INCOME STATEMENT



Total revenues


Operating income


Net income

Total net provisions

Taxes



(Euro mln) 3Q04/2Q04 % ch. 3Q04

718

-244

474

-154

34.0%

1

-128

193

193

388

330

9M043Q04/3Q03 % ch.

y/y % ch.

-16.6

-5.4

-21.4

-25.6

+402bp

n.s.

-15.8

-37.5

-37.5

+1.0

-30.7

-4.9

-3.3

-5.7

-4.1

+62 bp

n.s.

+19.6

-18.9

-18.5

+5.9

-15.2

2,340

746

1,594

-526

31.9%

66

-387

746

747

1,139

1,201

-7.4

-3.1

-9.3

-6.6

+141 bp

n.s.

+12.2

-14.1

-14.3

+1.6

-14.6

39

CORPORATE DIVISION - DETAILS ON ASSET QUALITY


9M04ch. on 2003

Provisions on performing loans 785 +3.6%



Coverage ratio 36.5% -66 bp

Cost of risk (annualised) 77 bp +8 bp2





Increased coverage on NPLs (+61 bp vs Jun.04). Coverage ratios adding back fiscal write-offs3:

at 69.2% on NPLs (+67 bp vs Jun.04) at 59.9% on Total Doubtful Loans (almost

stable vs Jun.04)

+3.6% increase of provision on performing loans vs Jun. 04, also due to 23 mln provisions on the automotive sector. Coverage ratio on performing loans at an high 1.23%

9M04 cost of risk (annualised) 8 bp up vs FY03 net of extraordinary provisions on Parmalat, mainly due to high provisions on a single position posted in 1H04; cost of risk at 68 bp (in line with FY03) net of provisions on this “single position”

Increase of Gross Doubtful Loans (+2.5% vs Jun.04) driven by Gross NPLs (+2.6% vs Jun.04) and Loans to be Restructured (from 372 mln as of Jun.04 to 400 mln as of Sep.04, +7.5%), offsetting the benefits of decreasing of Gross Watchlist Loans (from 532 mln as of Jun.04 to 522 mln as of Sep.04, -2.0%)

Sep. 04ch. on

Jun. 04


(1) Defined as: Flow from in bonis loans to any category of doubtful loans less Flow-back from any category of doubtful loans to in bonis loans

(3) Fiscal write-offs related to UBI only

40

(Euro mln)

Net interest income 328


Cost Income RATIO, %

118

28.9%

Net non interest income 130

Total revenues

Operating costs

Operating income

458

-132

326


Other net provisions

-115

-2

Of which:

89

- Trading profits 35

- Net commissions

UNICREDIT BANCA D’IMPRESA: 3Q04 AND 9M04 INCOME STATEMENT

3Q04/2Q04 % ch. 3Q04 9M043Q04/3Q03

% ch. y/y

% ch.

+4.3

+5.6

+96 bp

-18.9

-3.5

-0.2

-4.8

-14.7

-62.9

-7.0

-44.3

+10.7

+0.7

-202 bp

-5.2

+5.7

-1.3

+8.8

+23.8

-18.0

+5.9

-22.1

961

361

28.5%

428

1,389

-396

993

-350

-5

275

143

+7.7

-7.7

-32 bp

-12.8

+0.4

-0.7

+0.9

+29.0

-79.6

+14.3

-39.1

41

UBM: 3Q04 AND 9M04 INCOME STATEMENT

(Euro mln)

Financial ProductsSales and Trading

Investment Banking

Total revenues

Staff costs

Other costs (incl. depr.)

Operating income

Net income

C/I Ratio

of which derivatives

133

-28

-24

82

41

38.5%

123

10

107

Net extraord. income -

Taxes -39

3Q04/2Q04 % ch. 3Q04 9M043Q04/3Q03

% ch. y/y

% ch.1

-46.8

-0.5

-29.8

-56.6

-74.8

+1,394bp

-41.8

-73.9

-43.6

n.s.

-55.9

-36.7

-16.8

-20.6

-44.4

-54.3

+858 bp

-32.5

-64.0

-30.2

n.s.

-33.1

571

-84

-83

404

284

29.2%

509

62

447

58

-182

-29.9

-21.4

-8.5

-34.5

-27.0

+499 bp

-29.5

-33.2

-28.2

n.s.

-16.5

1 9M04/9M03 % ch. calculated netting 31 mln of tax credit on dividends accounted in 9M03

42

UBM Daily VAR2 and P&L (Jan 04 – Sep 04)Euro mln

Daily P&L

VaR

2 Calculated using a 98-99% asymmetric double tail confidence interval

9M04 avg. daily VAR: 3.9 mln

UBM1 VAR CHANNEL

-7

-5

-3

-1

1

3

5

7

J an-04

Jan-04

Jan-04

Feb-04

Feb-04

Mar-04

Mar-04

Mar-04

Apr-04

Apr-04

Apr-04

May-04

May-04

Jun-04

Jun-04

Jun-04

Jul-04

Jul-04

Jul-04

Aug-04

Aug-04

Aug-04

Sep-04

Sep-04

1 Pls. note that, the graph reflects UBM standing alone until June 30, 2004. From July 1st, 2004 it reflects UBM new perimeter (incl. TradingLab, merged in UBM from July 1st, 2004)

UBM stand alone UBM after merger of TradingLab

43

PRIVATE & AM DIVISION: 9M04 INCOME STATEMENT – BREAKDOWN BY COMPANY

Net interest income


Total revenues


Operating income

Net income

Cost/Income Ratio




- of which: other admin. expenses

(Euro mln)


TOTAL DIVISION2

73

770

843

-545

-245

-278

298

-2

255

247

64.7%

21

UPB +

Subsidiaries

55

189

243

-169

-95

-71

74

-1

56

42

69.5%

3

7

533

540

-279

-132

-136

261

-1

161

238

51.7%

20

10

39

50

-83

-12

-65

-33

0

-29

-21

n.s.

1

PGAM Group UniCredit Xelion Banca

1

8

9

-14

-7

-6

-5

-1

2

-12

n.s.

48

Other Companies1

1 Mainly companies deriving from the acquisition of ING and not integrated in UniCredit Xelion Banca2 Balance due to roundings and elisions of infragroup dividends and goodwill amortisation

44

PRIVATE & AM DIVISION: 3Q04 AND 9M04 INCOME STATEMENT



Total revenues


Operating income


Net income


Taxes



3Q04/2Q04 % ch. 3Q04

275

-175

100

-21

63.6%

12

-

88

91

24

251

9M043Q04/3Q03 % ch. Y/y % ch.

-2.7

-5.4

+2.3

+102.6

-179 bp

+37.0

n.s.

-4.3

-4.5

-1.4

-2.9

-0.4

+7.2

-11.5

-28.7

+455 bp

n.s.

n.s.

+8.2

+11.8

+5.0

-0.9

843

-545

298

-62

64.7%

21

-2

247

255

73

770

+6.9

+8.8

+3.6

-24.3

+113 bp

+300.9

-84.6

+19.6

+25.6

+4.3

+7.1

(Euro mln - Data at current FX, % ch. at fixed FX)

45

3 Including Momentum

1 Balance due to roundings

Italy

New Europe

(Euro mln)

89,095

2,577

TOTAL PIONEER

Alternative Investments3

119,436

2,449

165

287

2,408

1,385

US 21,884 286

International (ex-Italy)3 5,880 1,670

AuM as at 31.12.2003

US in USD 27,639 376

91,326

3,087

125,362

3,847

23,001

7,947

AuM as at 30.09.20041

28,543

AuM as at 31.10.20042

91,641

22,657

7,767

3,118

125,183

3,800

28,858

Net sales 9M04

PGAM GROUP: DEC03-OCT04 NET SALES AND AUM TREND

2 Provisional figures; balance due to Market Performance (including FX effect)

2,066

223

3,518

13

831

397

528

-141

25

79

13

87

108

108

Net sales Oct.04

Mkt. Perf. 9M04

46

VERY GOOD COMMERCIAL RESULTS FOR UPB AND XELION

1

1 All data related to Total Financial Assets, Financial Assets per PFA, and Net Sales relate to Xelion+ING (2003 data are pro-forma), excluding figures related to ex-ING PFA who did not agree on Xelion’s mandate – Source: Assoreti

+0.6%

40.1

40.1 bn Total Financial Assets, +0.6% Q/Q and +8.4% Y/Y, with higher weight of Hedge Funds (from 0.8% as of Sep.03 to 2.2% as of Jun.04 to 2.3% as of Sep.04)

309 mln net sales in 3Q04, with strong contribution of hedge funds (85 mln, more than 25% on the total)

70 mln Total Financial Assets per client-manager, vs 69.7 mln as of Jun.04 and 66.1 mln as of Sep.03

TOTAL FINANCIAL ASSETS(bn)

Sep.04Jun.04Sep.03

~11.3 bn Total Financial Assets (+3.2% Q/Q and +13.1 Y/Y)

Higher Financial Assets per PFA: from ~4.3 mln as of Sep.03 to ~5.1 mln as of Jun.04, to ~5.3 mln as of Sep.04, +25% Y/Y

TOTAL FINANCIAL ASSETS(bn)

37.039.9

+3.2%11.3

Sep.04Jun.04Sep.03

10.0 11.0

47

Finanza & Futuro

Rasbank + BNL Inv.ti4 Credem + Euromob.

6,692Credem + Euromob.

1 Calculated on average PFAs2 AUMs, Securities in Custody, Bancassurance and liquidity3 Ranking taking into account only the 10 major Italian players by Total Financial Assets as at 30.9.20044 BNL Investimenti recently acquired by RasBank

Source: Assoreti

Net Inflows:Euro 1,547 Mln,

1st in Italy

Data as at 30.9.2004 – Mln

TOTAL NET INFLOWS 2 & 3

Xelion 1,547

Mediolanum 1,008

Azimut 889

Banca Generali 568

474

Fineco 370

Credit Suisse

272Rasbank + BNL Inv.ti4

209

Finanza & Futuro -188

Fideuram + SPI -783

Data as at 30.9.2004

2,122 PFAs,5th in Italy

NUMBER OF PFAs

Fideuram + SPI 4,349

Mediolanum 4,078

3,955

Banca Generali 2,336

Finanza & Futuro 1,160

Banca 121

1,102

Azimut 872

821

Tot. Fin. Assets:~11.3 bn,5th in Italy


TOTAL FINANCIAL ASSETS

Fideuram + SPI 57,731

Mediolanum 20,371

Rasbank + BNL Inv.ti4 18,489

7,935Azimut

7,852

Credit Suisse 7,069

Xelion 11,314

13,702

Fineco 6,187

Net Inflows per PFA1:2rd among Top-

Players


NET INFLOWS PER PFA 2 & 3

Azimut 1.10

Xelion 0.71

Credit Suisse 0.65

Credem + Euromob. 0.43

0.25

Banca Generali

0.23

Finanza & Futuro

0.07

-0.16

Fideuram + SPI -0.18

Fineco

0.21

XELION: CONFIRMED LEADERSHIP FOR TOTAL NET SALES IN 9M04 (WITH A STRONG 25.7% MKT. SHARE) AND OUTSTANDING PRODUCTIVITY PER PFA

Rasbank + BNL Inv.ti4

Xelion 2,122

Fineco 1,520

Mediolanum Credem + Euromob.

Banca Generali

48

2.4%1

2.4%1

GOOD NET INCOME GROWTH IN 3Q BENEFITING FROM HIGHER REVENUES, LOWER COSTS AND DECREASED COST OF RISK

(Euro mln)

Net interest income2


Total revenues

Operating Costs3

Operating income

Net write-down of loans


Net income


Taxes

4 Including provisions to reserve for general banking risk

2 Including dividends3 Including depreciation

%ch. at unchanged FX

7.7%1

37.7%1

20.1%1

26.0%1

1 Weight of the bank Total Revenues in 3Q04 on Division Total Revenues – only UCI’s portion; balance due to UniLeasing Romania and Xelion Poland


Cost/Income ratio (%)

NEW EUROPE DIVISION % ch. on 3Q03

+3.3

+1.9

+2.8

+2.2

+3.4

-5.7

n.m.

+27.6

-80.4

-31.0

+21.5

-0.3 pp

3.2%1

BREAKDOWNOF REVENUES

ITAS

3Q04

285

160

445

-235

210

-30

12

162

-1

-29

113

52.8

% ch. on 2Q04

+4.4

-2.4

+1.8

-2.5

+7.1

-1.1

n.m.

+15.7

-43.1

+70.6

+18.9

-2.3 pp

9M04

825

482

1,307

-704

603

-96

9

424

-4

-89

292

53.9

y/y % ch.

+1.9

+8.8

+4.3

+2.5

+6.5

-9.5

-60.9

+21.5

-59.8

-29.4

+18.2

-0.9 pp

49

FURTER IMPROVEMENT IN NEW EUROPE ASSET QUALITY WITH HIGHER COVERAGE RATIOS

Net NPLs and Doubtful Loans as % of Total Net Loans

83.2

Jun04 Sep04

84.568.5 72.4

Coverage ratios

On Gross Doubtful Loans

On Gross NPLs

Net NPL/ Loans %

Sep04

Total NE -1.32.7

ch. on Jun04 (pp)

Net Doubtful/Loans %

Sep04

ch. on Jun04 (pp)

5.8-0.3

At unchanged FX

Zaba -1.51.8 2.9+0.0

Unibanka -0.32.8 5.9-0.5

Pekao -1.34.1 8.8-0.3

Bulbank 0.1 -0.71.1-0.1

KFS -0.62.3 5.1-0.5

Further improvement in Coverage ratios and cost of risk

Cost of risk1

-24 bp

(bp, annualised)

120

96

Sep04FY03

1 Calculated as Net Loan Loss Provisions on Net Customer Loans at period-end, 9M04 data annualised

Zivno 0.5 +0.03.4-0.3

Decreasing Net Doubtful/Net Loans and Net NPL/Net Loans ratios in NE

Decreased gross watchlist (-21.0% on Jun04) driven by Zaba (-67.8%) and Pekao (-17.4%) with higher coverage ratio (+1.2 pp to 14.2%)

ITAS

50

Interest margin (incl. div.)


Total revenues



Net income

ROE

Cost/income

TOTAL1

825

482

1,307

-704

603

424

20.2%

53.9%

Net provisions -99

1 Balance due to roundings and other small companies

(Euro mln)

(UCI stake)

Net income3 (UCI’s portion) 292

- of which: Staff costs -353

- of which: Other costs -253

NEW EUROPE DIVISION: 9M04 RESULTS BREAKDOWN BY BANK

- o/w: Net write-down of loans -96

UNI BANKA (77.2%)

19

13

32

-23

9

7

11.9%

73.3%

-2

5

-11

-10

-2

BULBANK (85.2%)

46

31

77

-27

50

20.6%

34.8%

-4

38

32

-11

-11

-4

Group PEKAO (53.0%)

389

309

698

-387

311

21.0%

55.4%

228

-58

125

-195

-138

-50

195

71

266

-146

120

89

20.0%

54.8%

-12

72

Group ZABA

(81.9%)

-79

-47

-19

10

9

19

-15

5

3

5.8%

76.1%

-7

-6

-3

3

-3

135

37

172

-73

99

54

26.6%

42.2%

-35

-29

-21

54

KFS2 (50.0%)

-18

2 Consolidated with proportional method (50%)

21

11

32

-28

4

+5

6.7%

88.2%

-13

-10

+0

+1

Zivno (96.6%)

+0

UniCredit Romania (99.9%)

ITAS

Banks’ data gross of consolidation adjustment

3 Net of consolidation adjustment

51

CONSOLIDATED INCOME STATEMENT: PEKAO


1 Including dividends2 Including depreciations

4 At unchanged FX

(Euro mln)



Total revenues

Operating costs2

Operating income



Net income


Taxes

Net income for the Group5

% ch.4 on 3Q033Q04

130

93

222

-128

93

-14

+12

79

-2

-10

44

% ch. on 2Q044

-1.5

-16.5

-8.4

-1.4

-17.0

-6.7

n.m.

-4.4

-47.6

n.m.

-4.9

-4.0

-1.0

-2.8

-0.7

-4.1

-10.0

n.m.

+37.4

+76.6

-57.4

+47.0

ITAS

Data gross of consolidation adjustment

9M04

389

309

698

-387

311

-50

+7

228

-7

-32

125

y/y % ch.4

-6.2

+11.9

+1.0

-1.0

+4.4

-27.0

-53.6

+30.5

n.m.

-53.2

+35.3

5 Net of consolidation adjustment

52

2 Calculated as Net Loan Loss Provisions of 2Q04 on Net customers Loans at period-end

PEKAO RESULTS IN 3Q04: REVENUES IMPACTED BY LOWER CONTRIBUTION OF MUTUAL FUNDS COMMISSIONS, GOOD COST CONTROL AND IMPROVED ASSET QUALITY

ITAS

1 Excluding dividends

Total Revenues down 8.4% on 2Q, as a result of:

Substantially stable net interest income (-0.2% on 2Q04), positively impacted by commercial banking activity spread counterbalanced by negative impact of debt securities spread

Lower net commissions mainly due to decreasing sale of Mutual Funds and lower fees from lending activity

Costs down -1.4% on 2Q04 thanks to good cost control

Improved cost of risk also thanks to better macroeconomic environment, increased coverage of doubtful loans (73.4% from 70.2% in Jun04)

Net Income for the Group down 4.9% on 2Q04 (that benefited from a one-off release of deferred tax) and up 47.0% on 3Q03

At unchanged FX

Data gross of consolidation adjustment

Attributable Net Income

3Q04(Euro mln)

44

Total revenues 222

Operating income 93

Cost/Income 57.8%

Cost of Risk2 (annualised) 95 bp

- o/w net interest income1 128

Net write-downs of loans -14

ROE (9M04 data, y/y % ch.)

% ch. on

2Q04

-4.9

-8.4

-17.0

+4.1 pp

-8 bp

-0.2

- o/w net commissions 47 -15.6

-6.7

21.0%

Operating costs -128 -1.4

Tax Rate 10.8% +6.7 pp

% ch. on

3Q03

+47.0

-2.8

-4.1

+1.2 pp

+11 bp

-3.4

-24.1

-10.0

+4.7 pp

-0.7

-17.3 pp

53


1 Including dividends2 Including depreciations

4 At unchanged FX

CONSOLIDATED INCOME STATEMENT: ZAGREBACKA

ITAS

(Euro mln)



Total revenues

Operating costs2

Operating income



Net income


Taxes


% ch.4 on 3Q033Q04

70

30

99

-47

52

-8

+1

40

+3

-7

33

% ch. on 2Q044

+9.6

+80.6

+24.1

-10.6

+91.0

+79.2

n.m.

+107.3

-30.8

+38.7

+109.4

+13.1

+9.9

+12.1

-2.4

+29.5

+51.7

n.m.

+37.7

n.m.

+26.1

+48.6

9M04

195

71

266

-146

120

-19

+0

89

+7

-20

72

y/y % ch.4

+8.7

-5.3

+4.6

+2.4

+7.3

+34.3

-85.1

+9.5

n.m.

+9.4

+13.0

Data gross of consolidation adjustment (excluding Net Income for the Group that is net)

Documents

UNICREDITO ITALIANO GROUP 9M 2004 Results Alessandro Profumo - CEO