Consolidated, audited financial results of Slovenská sporiteľňa as of 31 December 2014, according to the International Financial Reporting Standards (IFRS).

„Slovenská sporiteľňa experienced another outstanding year. Owing to a strong loan growth, effective risk management and cost discipline, we were able to moderately increase our operating profit. We are not only growing in the retail sector but in the corporate sector as well. Thanks to these factors, we became bank of the year for the third year in a row. Our capital adequacy is also above average and we have sufficient funds for further growth,” said Štefan Máj, Chairman of the Board of Directors and CEO of Slovenská sporiteľňa.

Financial highlights as of 31 December 2014 (y/y comparison)

• Net interest income increased by 3.5 % y/y from EUR 448.0 million to EUR 463.9 million
• Net fee and commission income increased by 5.1 % y/y from EUR 117.4 million to EUR 123.4 million
• Operating profit increased by 0.7 % y/y from EUR 331.5 million to EUR 333.8 million (+ 3.4 % without the contribution to the Deposit Protection Fund)
• Net profit after tax decreased by 1.5 % y/y from EUR 184.9 million to EUR 182.1 million
• Volume of loans and receivables to customers grew by 12.9 % y/y from EUR 7.2 billion to EUR 8.1 billion
• Deposits from customers increased by 6.3 % y/y from EUR 9.1 billion to EUR 9.7 billion
• Cost/income ratio reached 44.5 %
• Capital adequacy reached 19.86 % and considerably exceeds the limit stipulated by the law (according to NBS, Basel III requirements and IRB approach)
• Loan-to-deposit-ratio increased by 4.8 percentage points y/y from 78.8 % to 83.6 %

Business performance overview of Slovenská sporiteľňa a.s. of 31 December 2014

Net interest income increased by 3.5 % y/y from EUR 448.0 million to EUR 463.9 million. The positive development was influenced mainly by growth of the volume of provided loans by EUR 924.4 million and decline of interest costs for deposits due to a structural change in favour of current accounts and savings accounts.

Net fee and commission income increased by 5.1 % y/y from EUR 117.4 million to EUR 123.4 million. The main reason behind the growth was the increased sale of unit certificates, insurance products and number of transactions executed by clients.

General administrative expenses increased by 6.9 % y/y from EUR 250.5 million to EUR 267.8 million mainly due to renewed introduction of the contribution to the Deposit Protection Fund (payment into the Fund was EUR 8.9 million).

Cost/income ratio increased from 43.0 % to 44.5 % y/y. Without the contribution to the Deposit Protection Fund the cost/income ratio would remain on the same level as in 2013 (43 %).

Risk costs for loans and receivables went up in 2014 from EUR 47.2 million to EUR 51.4 million y/y. Risk costs went up in the segment of real estate finance and a decline of risk costs was recorded in the segment of loans provided to retail clients and corporate clients as well. The share of defaulted loans on total loan volume remained low at 6.3 %.

Slovenská sporiteľňa passed the Comprehensive Assessment of the European Central Bank which took place in 2014 with excellent results. The bank maintains above-average capital adequacy after the Asset Quality Review (AQR adjusted CET1 ratio reached 19.41 %) and as well after both stress tests (adjusted CET1 ratio reached 19.91 % after baseline scenario and 19.51 % after adverse scenario). Slovenská sporiteľňa became the 11th most stable bank in the Eurozone.

Consolidated net profit after tax attributable to owners of parent decreased only slightly by 1.5% y/y and reached EUR 182.1 million. Levies on the banking activities (contribution to the Deposit Protection Fund and banking tax) reached EUR 40.4 million.

The volume of loans to customers increased by 12.9 % compared with 2013 and achieved EUR 8.1 billion. Retail loans were the major driving force; they increased by 16.9 % y/y (by EUR 906 million). Slovenská sporiteľňa strengthened its position as market leader in retail loans; its market share reached 26.87 %. The main growth drivers were housing loans which grew by 16 % (by EUR 638 million) and consumer loans which grew by 18.9 % (by EUR 191 million). Loans to corporate clients remained at the same level of EUR 2.2 billion y/y and the growth in the segment of large corporate clients by 14.4 % was offset by the decline in public sector by 16.9 %.

Deposits from customers rose by 6.3 % from EUR 9.1 billion to EUR 9.7 billion compared with the year 2013. Retail deposits increased from EUR 7.5 billion to EUR 7.9 billion, providing a solid base for financing and room for further growth.

Note:

Starting with 2014, as a result of harmonization with FINREP reporting, Slovenská sporiteľňa, in line with Erste Group, changed the structure of the line items in balance sheet and income statement in order to align with EBA requirements for financial reporting.

The adoption of FINREP does not impact historic net profit, equity or balance sheet totals but introduces a more granular income statement and balance sheet structure.