#1Emirates NBD EMIRATESNBD.COM Emirates NBD TOGETHER WE WILL CONQUER EMIRATES NBD BANK PJSC BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 C الرعايات دبي الوطني Emirates NBO#2EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 BASEL II - PILLAR III DISCLOSURES Contents Overview Information on subsidiaries and significant investments Consolidated capital structure as per Basel III Gross credit exposure Capital requirement for market risk as per standardised approach Gross credit exposure by currency Gross credit exposure by geography Gross credit exposure by economic activity Gross credit exposure by maturity Impaired loans by economic activity Impaired loans by geography Reconciliation of changes in provision for impaired loans Gross credit exposure as per standardised approach Gross credit exposure as per standardised approach (Rated/Unrated) Exposure subject to deduction as per standardised approach (Rated/Unrated) Credit risk mitigation as per standardised approach Quantitative disclosures for equity position in the banking book Page 1 4 6 10 11 12 13 15 17 19 21 23 24 26 28 30 ل دیا 31 بنك الإمارات دبي الوطني Emirates NBD#3OVERVIEW In November 2009, The Central Bank of the United Arab Emirates ("CBUAE") issued guidelines for implementation of Basel II Capital Accord in the banks in UAE. As per the circular, the Standardised Approach for Credit Risk was to apply immediately with an expectation that internationally active UAE banks and larger institutions will migrate to the Foundation Internal Rating Based (FIRB) in due course. The CBUAE Basel II framework is intended to strengthen the market discipline and risk management while enhancing the safety and soundness of the banking industry in UAE. In February 2017, the new Basel III capital regulations issued by CBUAE came into effect for all Banks in the UAE. The guidelines for Pillar 1 - Calculation of Credit Risk pertain to the Standardised Approach of Basel II only. One of the major changes brought in with the new guidelines is the ability to apply, on an asset class basis, risk weightings determined from ratings provided by External Credit Assessment Institutions ("ECAI") approved by CBUAE. CBUAE requires the Pillar 2 - Supervisory Review Process to focus on each bank's Internal Capital Adequacy Assessment Process (ICAAP) in addition to Pillar 1 Capital calculations. The ICAAP should include a risk based forward looking view of, but not limited to, Credit, Market and Operational Risk Capital. The purpose of Pillar 3 - Market Discipline is to complement the minimum capital requirements (Pillar 1) and the supervisory review process (Pillar 2). The CBUAE supports the enhanced market discipline by developing a set of disclosure requirements which will allow market participants to assess key pieces of information on the scope of application, capital, risk exposure, risk assessment process and hence the capital adequacy of the institution. The Pillar 3 disclosures, based on a common framework, are an effective means of informing the market about the risks faced by a bank, and provide a consistent and understandable disclosure framework that enhances transparency and comparability. In compliance with the CBUAE guidelines and Basel II accord, these disclosures include information on the Group's risk management objectives and policies, risk assessment processes and computation, capital management and capital adequacy. Quantitative information on risk assessment (per standardised approach) includes: • . . Risk weighted assets of the Group - credit risk, market risk and operational risk Credit risk profile of gross credit exposure by counterparty classifications, rated/unrated Profile of gross credit exposure by economic activity, geographical region and maturity Profile of credit risk mitigation by economic activity, geographical region and maturity Profile of impaired loans by economic activity and geographical region Information on capital adequacy includes: . Capital adequacy computation • Capital profile CET 1, Tier I and Tier II OVERVIEW (continued) Introduction The CBUAE supervises Emirates NBD ("ENBD" or the "Bank") and its subsidiaries (together referred to as the "Group") on a consolidated basis, and therefore receives information on the capital adequacy of, and sets capital requirements for, the Group as a whole. The capital requirements are computed at a Group level using the Basel III framework of the Basel Committee on Banking Supervision ("Basel Committee"), after applying the amendments advised by the CBUAE, within national discretion. The Basel III framework, like Basel II, is structured around three 'pillars': minimum capital requirements (Pillar I); supervisory review process (Pillar II); and market discipline (Pillar III). Pillar III disclosures 2020 Pillar Ill complements the minimum capital requirements and the supervisory review process. Its aim is to encourage market discipline by developing disclosure requirements which allow market participants to assess certain specified information on the scope of application of Basel III, capital, particular risk exposures and risk assessment processes, and hence the capital adequacy of the institution. Disclosures consist of both quantitative and qualitative information and are provided at the consolidated level. The CBUAE issued Basel III capital regulations, which came into effect from 1 February 2017 introducing minimum capital requirements at three levels, namely Common Equity Tier 1 ('CET1'), Additional Tier 1 ('AT1') and Total Capital. Additional capital buffers (Capital Conservation Buffer and Countercyclical Capital Buffer - maximum up to 2.5% for each buffer) introduced are over and above the minimum CET1 requirement of 7%. Significant Developments Target Economic Support Scheme (TESS) Standards During Q1 2020 in light of the Covid situation, the CBUAE issued TESS standards for Banks operating in UAE. Following key relief are provided by CBUAE to UAE banks; . . . As per the standards, the banks are allowed to tap into the capital conservation buffer up to a maximum of 60% without supervisory consequences. The Domestic Systemically Important Banks (D-SIBS) are allowed to use 100% of their D-SIB buffer without supervisory consequences. With the Tess relaxations, the overall capital buffer reduced by 3% - Capital Conservation Buffer (1.5%) and D-SIB buffer by 1.5%. The relief is effective until 31 December 2021. Cash Reserve Ratio (CRR) - on Demand Deposits reduced from 14% to 7%. Liquidity Coverage Ratio (LCR) thresholds reduced from 100% to 70%. Eligible Liquid Asset Ratio (ELAR) threshold reduced from 10% to 7%. The CBUAE has also postponed the June 2020 implementation of new Basel III standards in phased manner including Basel III Pillar 3 disclosures to 2021 and 2022. ECL add back - In Q1'20, the CBUAE issued a regulation for a 'Prudential Filter' that permits Banks to add back incremental ECL (Stage 1 and Stage 2) from 1 January 2020 to the regulatory capital. The ECL add back will be 100% for the first 2 years and subsequently needs to be phased out over 3 years. 1 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 2 بنك الإمارات دبي الوطني Emirates NBD#4w OVERVIEW (continued) Future Developments In 2017, the CBUAE issued 'Regulations regarding Capital adequacy, supplementing the introduction of these regulations, in April 2020 and in November 2020, CBUAE issued 'standard regarding capital adequacy'. These standards support the implementation of the regulations. The CBUAE has also developed 'Guidance regarding capital adequacy' to assist banks in the application of the regulations. Based on these standards, revised Pillar 1 capital adequacy standards and revised Pillar 3 disclosures requirements will be effective from December 2021. Verification The Pillar III Disclosures for the year 2020 have been reviewed by the Group's statutory auditors. Implementation of Basel II guidelines The Group is compliant with Standardised Approach for Credit, Market and Operational Risk (Pillar I) with effect from 31 October 2007. The Group also assigns capital on other than Pillar I risk categories, for 'Interest Rate risk on Banking Book' and for 'Business Risk', within the Pillar Il framework. Group Structure Emirates NBD Bank PJSC (the "Bank") was incorporated in the United Arab Emirates on 16 July 2007 consequent to the merger between Emirates Bank International PJSC ("EBI") and National Bank of Dubai PJSC ("NBD"), under the Commercial Companies Law (Federal Law Number 8 of 1984 as amended) as a Public Joint Stock Company. The consolidated financial statements for the year ended 31 December 2020 comprise the financial statements of the Bank and its subsidiaries (together referred to as the "Group") and the Group's interest in associates and joint ventures. The Bank is listed on the Dubai Financial Market (TICKER: "EMIRATESNBD"). The Group's principal business activities are corporate and institutional banking, retail banking, treasury and Islamic banking. The Bank's website is www.emiratesnbd.com. EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 4 Group % Shareholding Nature of Business Call centre Buzz Contact Centre Solutions LLC 100 The complete listing of all direct subsidiaries and associate companies of Emirates NBD as of 31 December 2020 is as follows: Subsidiaries: Description of Accounting Treatment of Regulatory Capital Treatment Description (Consolidation/ (Consolidation/ Deduction from capital/neither) Consolidation Bank's total interests (current book value) in insurance entities (AED 000) Country of management services DenizBank Anonim Sirketi 100 Banking Incorporation Dubai, U.A.E. Turkey Dubai Bank PJSC 100 Islamic banking Dubai, U.A.E. Investment Consolidation Consolidation Consolidation Accounting) Consolidation Consolidation Emirates Funds LLC 100 Asset management Dubai, U.A.E. Consolidation Consolidation Emirates Funds Managers (Jersey) Limited 100 Asset management Jersey Consolidation Consolidation Emirates Islamic Bank PJSC 99.9 Islamic banking Dubai, U.A.E. Consolidation Consolidation Emirates Money Consumer Finance LLC 100 Emirates NBD Asset Management Limited 100 Consumer finance Asset management Dubai, U.A.E. Consolidation Consolidation Dubai, U.A.E. Consolidation Consolidation Emirates NBD Capital (KSA) LLC 100 Investment services KSA Consolidation Consolidation Emirates NBD Capital PSC 100 Funds management Dubai, U.A.E. Consolidation Consolidation Emirates NBD Egypt S.A.E 100 Banking Egypt Consolidation Consolidation Medium term Emirates NBD Global Funding Limited 100 borrowing and money Cayman Islands Consolidation market transactions Emirates NBD Properties LLC 100 Real estate Dubai, U.A.E. Consolidation Consolidation Neither Included in gross credit exposure as investment at carrying value Emirates NBD Securities LLC 100 Brokerage services Emirates NBD Trust Company (Jersey) 100 Limited Trust administration services ENBD London Branch Nominee Company 100 Asset management Dubai, U.A.E. England Jersey Consolidation Consolidation Consolidation Consolidation Consolidation Consolidation Shared services Tanfeeth LLC 100 Dubai, U.A.E. Consolidation Consolidation organisation The Emirates National Dubai Real Estate Company LLC Nominee company for 100 KSA Consolidation Consolidation mortgage business بنك الإمارات دبي الوطني Emirates NBD#5Associate: Shareholding Nature of Business Group % Country of (Consolidation/ of Accounting Treatment Investment Description Incorporation Accounting) National General Insurance Company PSC 36.7 General and life insurance Dubai, U.A.E. Equity Accounting Description of Regulatory Capital Treatment Deduction from capital/neither) (Consolidation/ Neither Included in gross credit exposure as investment at carrying value Bank's total interests (current book value) in insurance entities (AED 000) 183,962 1 SPE for asset securitisation Consolidation Consolidation Emirates NBD Global Markets Limited SPE for funding purpose Consolidation Consolidation ENBD Asset Finance Company No.1 DAC (under liquidation) SPE for asset securitisation Consolidation Consolidation ENBD Asset Finance Company No.2 Limited SPE for asset securitisation Consolidation Consolidation Emirates NBD Tier 1 Limited SPE for funding purpose Consolidation Consolidation Emirates NBD 2014 Tier 1 Limited SPE for funding purpose Consolidation Consolidation EIB Sukuk Company Limited SPE for asset securitisation Consolidation Consolidation El Funding Limited SPE for asset securitisation Consolidation Consolidation Other entities consolidated by the Group based on an assessment of control are as follows: Group Tranche of Emblem Finance Company No. 2 Limited 5 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 9 CONSOLIDATED CAPITAL STRUCTURE AS PER BASEL III The CBUAE issued Basel III capital regulations, which came into effect from 1 February 2017 introducing minimum capital requirements at three levels, namely Common Equity Tier 1 ('CET1'), Additional Tier 1 ('AT1') and Total Capital. Additional capital buffers (Capital Conservation Buffer and Countercyclical Capital Buffer - maximum up to 2.5% for each buffer) have been introduced over and above the minimum CET1 requirement of 7%. For 2020, as per the TESS standards, Capital Conservation Buffer is required to be kept at 1% of the Capital base. Countercyclical Capital Buffer is not in effect and is not required to be kept for 2020. Over and above additional capital buffers, the Group as a D-SIB is required to keep an additional D-SIB buffer of 1.5% of the Capital base. However, this requirement is exempt as per the TESS standards. Regulatory Capital The Group's capital base is divided into three main categories, namely CET1, AT1 and Tier 2, depending on their characteristics. CET1 capital is the highest quality form of capital, comprising share capital, share premium, legal, statutory and other reserves, fair value reserve, retained earnings, non-controlling interest after deductions for goodwill and intangibles and other regulatory adjustments relating to items that are included in equity but are treated differently for capital adequacy purposes under 'CBUAE' guidelines. AT1 capital comprises eligible non-common equity capital instruments. Tier 2 capital comprises qualifying subordinated debt, and undisclosed reserve. The capital overview as per Basel III framework is given below: Available capital Common equity tier 1 capital Tier 1 capital Total eligible capital Risk-weighted assets Credit risk Market risk Operational risk 2020 AED 000 2019 AED 000 67,134,947 65,452,344 77,514,733 74,559,700 82,434,262 79,375,840 393,562,281 385,291,210 14,600,122 10,190,488 38,291,452 33,027,671 446,453,855 428,509,369 Total risk-weighted assets The capital adequacy ratios as per Basel III capital regulation are given below: Capital Ratio a. Total capital ratio for consolidated Group b. Tier 1 ratio only for consolidated Group c. CET1 ratio only for consolidated Group 2020 2019 18.46% 18.52% 17.36% 17.40% 15.04% 15.27% بنك الإمارات دبي الوطني Emirates NBD#67 CONSOLIDATED CAPITAL STRUCTURE AS PER BASEL III (continued) The consolidated capital structure as per Basel III is given below: CONSOLIDATED CAPITAL STRUCTURE AS PER BASEL III (continued) 2020 AED 000 2019 AED 000 Common Equity Tier 1 Capital Share Capital Share premium account 6,316,598 17,954,164 6,316,598 17,954,164 TIER I CAPITAL NOTES The Group has issued a number of regulatory Tier 1 capital notes with details mentioned in the table below. The notes are perpetual, subordinated and unsecured. The Group can elect not to pay a coupon at its own discretion. Note holders will not have a right to claim the coupon and such event will not be considered an event of default. The notes carry no maturity date and have been classified as equity. Issuance Month/year Issued Amount Coupon rate Eligible Reserves 2,710,530 4,456,124 Transitional arrangement: Partial addback of IFRS 9 ECL impact to CET1 July 2020 2,002,738 March 2019 USD 750 million (AED 2.75 billion) USD 1 billion (AED 3.67 billion) Retained Earnings/(-) Loss 47,014,778 43,375,416 June 2009 AED 4 billion Dividend Expected/Proposed (2,526,639) Fixed interest rate with a reset after six years Fixed interest rate with a reset after six years Fixed interest rate for the first five years and on a floating rate basis thereafter. Eligible amount of minority interest 22,124 3,638 CET1 capital before the regulatory adjustments and threshold deduction The Group has exercised its option to call back the following notes in September 2020 and as a result these have been repaid in full. 73,494,293 72,105,940 Less: Regulatory deductions (6,359,346) (6,653,596) Issuance Month/year Issued Amount Coupon rate Total CET1 capital after the regulatory adjustments and threshold deduction 67,134,947 65,452,344 September 2014 USD 500 million (AED 1.83 billion) Fixed interest rate with a reset after six years Total CET1 capital after transitional arrangement for deductions (A) 67,134,947 65,452,344 Additional Tier 1 Capital CAPITAL ADEQUACY (STANDARDISED APPROACH) Eligible AT1 capital 10,379,786 9,107,356 2020 2019 Other AT1 Capital e.g. (Share premium, minority interest) Total AT1 capital 10,379,786 9,107,356 Total Capital Requirements Total AT1 capital after transitional arrangements (B) 10,379,786 9,107,356 Credit Risk Capital Charge AED 000 57,066,531 Capital Charge AED 000 55,867,225 Tier 2 Capital Market Risk 1,533,013 1,070,001 Tier 2 Instruments e.g. subordinated loan Operational Risk 4,020,602 3,467,905 Other Tier 2 capital (including General Provisions, etc.) 4,919,529 4,816,140 Total Capital Requirements 62,620,146 60,405,131 Total Tier 2 Capital 4,919,529 4,816,140 Total Tier 2 capital after transitional arrangements (C) Total Regulatory Capital (A+B+C) 4,919,529 4,816,140 82,434,262 79,375,840 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 8 بنك الإمارات دبي الوطني Emirates NBD#7CAPITAL ADEQUACY (STANDARDISED APPROACH) (continued) Standardised Approach - Credit risk & credit risk mitigation Under Standardised Approach, all credit exposures are assessed according to the counterparty classifications and against the External Credit Assessment Institutions ("ECAI") ratings as advised under national discretion (November 2009): Claims on sovereign and central banks in the GCC are risk weighted at 0% (where applicable). Domestic currency claims on a non-commercial GCC Public Sector Enterprise (PSE) are treated as claims on their sovereigns if their central bank or monetary authority treats them as such. Foreign currency claims on such a PSE are risk weighted one grade less favorable than its sovereign i.e. 20% risk weight. Claims on other foreign PSES are risk weighted one grade less favorable than its sovereign. Claims on commercial companies owned by a GCC sovereign or PSEs that operate as commercial organisations are treated as claims on a corporate and risk weighted in accordance with ratings from acceptable ECAls. ECAI ratings are also used to determine the capital requirements against exposures to banks and financial institutions. The Group uses option 2 (one of alternative risk weight and ECAI ratings matrices as prescribed in the Basel II accord) for determining the capital requirements in line with the supervisory discretion adopted by the CBUAE. Claims on corporate entities are risk weighted at prescribed risk weights applicable per the latest ECAI rating of the counterparty. Claims on unrated corporate and SME entities are risk weighted at 100% and 85% (where applicable). Consumer banking exposure is classified into 'Qualified Residential Mortgage', 'Qualified regulatory retail portfolio' and 'Others'; per the CBUAE Basel II guidelines and are risk weighted at 35%, 75% and 100% respectively. All other assets are classified between 'assets under higher risk categories' and 'others'; and risk weighted at prescribed risk weights. For standardised capital adequacy calculations, the following rules are applied consistently to determine the appropriate ECAI ratings: Where more ECAI ratings of two acceptable rating agencies are available, the lower (worse) of the two is considered. Where the ECAI ratings are split evenly between all four rating agencies, the more conservative ratings are considered. Acceptable ECAI agencies are Moody's, S&P, Fitch and Capital Intelligence. 9 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 10 Claims on sovereigns Claims on non-central government public sector entities Claims on multi-lateral development banks 2020 Gross Exposure Risk Weighted AED 000 311,668,280 1,891,290 327,238 51,815,272 Assets AED 000 45,887,566 148,993 Gross Exposure AED 000 308,088,724 1,317,355 113,847 2019 Risk Weighted Assets AED 000 41,060,094 122,849 Credit Risk The total capital charge for credit risk as at 31 December 2020 is AED 57,067 million (2019: AED 55,867 million). GROSS CREDIT EXPOSURE AS PER STANDARDISED APPROACH Claims on banks 28,950,761 Claims on securities firms 540 503 3,929 55,540,475 25,916,226 3,929 Claims on corporate and Government related entities (GRE) 219,605,994 Claims included in the regulatory retail portfolio 74,477,375 Claims secured by residential property Claims secured by commercial real estate Past due loans Higher-risk categories Other assets Total 19,230,535 41,847,076 40,766,658 162,797 26,329,419 788,122,474 188,044,759 54,668,530 9,193,629 41,847,076 6,929,218 218,675,965 73,032,780 16,699,384 41,618,482 35,423,980 190,959,340 52,871,754 8,127,016 244,195 17,647,051 273,191 23,436,398 .............. 393,562,281 774,224,510 41,618,482 7,777,137 409,787 16,424,596 385,291,210 بنك الإمارات دبي الوطني Emirates NBD#8Market Risk Market risks subject to capital charge are as follows: Interest Rate Risk Foreign Exchange Risk Equity Exposure Risk Commodity Risk Options Risk Capital charge on interest rate risk and equity exposure risk is restricted to Group's 'trading book', while capital charge on Foreign exchange risk applies on the Group's entire positions. The total Capital requirement for Market Risk as at 31 December 2020 is AED 1,533 million (2019: AED 1,070 million) as detailed below: Interest rate risk CAPITAL REQUIREMENT FOR MARKET RISK AS PER STANDARDISED APPROACH Equity position risk Options risk Foreign exchange risk Total capital requirement 2020 AED 000 1,141,055 2019 AED 000 875,773 122,412 64,503 269,546 129,725 1,533,013 1,070,001 Operational Risk Basel II framework outlines three methods for calculating the risk charge for operational risk - Basic Indicator, Standardised Approach and Advanced Measurement Approach. The Group presently follows the Standardised Approach. The total capital requirement for Operational Risk as at 31 December 2020 is AED 4,021 million (2019: AED 3,468 million). This charge is computed by categorising the Group's activities into 8 business lines (as defined by Basel II guidelines) and multiplying the line's three year average gross income by a pre-defined beta factor. 11 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 Loans Other off-balance & Islamic financing AED 000 Debt securities AED 000 Other assets AED 000 Total funded AED 000 Commitments AED 000 OTC derivatives AED 000 sheet exposures AED 000 Total AED 000 non-funded Total AED 000 Foreign Currency 161,448,599 66,029,441 74,254,711 301,732,751 4,759,962 13,205,965 39,254,890 57,220,817 358,953,568 AED Total 326,712,275 488,160,874 66,029,441 411,732,097 159,274,533 713,464,848 85,019,822 3,545,955 8,305,917 1,430,256 14,636,221 12,460,598 51,715,488 17,436,809 74,657,626 429,168,906 788,122,474 RISK MANAGEMENT OBJECTIVES AND POLICIES CREDIT RISK Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies on Credit risk GROSS CREDIT EXPOSURE - CURRENCY CLASSIFICATION 31 DECEMBER 2020 Loans Islamic & Financing AED 000 Debt securities AED 000 Other assets AED 000 Total funded AED 000 OTC Commitments AED 000 derivatives AED 000 exposures Other sheet off-balance AED 000 Total non-funded Total AED 000 AED 000 Foreign Currency 152,390,079 49,542,542 82,005,464 283,938,085 4,342,980 9,462,183 40,037,961 53,843,124 337,781,209 AED Total 322,390,635 474,780,714 1,346 49,543,888 92,808,307 174,813,771 415,200,288 699,138,373 21,243,013 75,086,137 436,443,301 774,224,510 Other Assets include Cash & Deposits with Central Bank, Due from Banks, Trading securities, Investment securities (net of Debt Securities), Investment Properties, Investment in associate, Property & Equipment, and Other Assets. 4,568,025 8,911,005 1,235,175 10,697,358 15,439,813 55,477,774 31 DECEMBER 2019 بنك الإمارات دبي الوطني Emirates NBD#9The Group's credit exposure by Geography and Economic activity, both funded and non-funded is detailed below: GROSS CREDIT EXPOSURE BY GEOGRAPHY 31 DECEMBER 2020 Loans Other off-balance & Islamic financing AED 000 Debt securities AED 000 Other assets AED 000 Total funded AED 000 Commitments AED 000 OTC derivatives AED 000 sheet exposures AED 000 Total non-funded AED 000 Total AED 000 United Arab Emirates GCC excluding UAE* Arab League (excluding GCC) Asia Africa North America 158,621 3,230,572 South America Caribbean Europe Australia 6,955 79,837 15,402,818 221,106 372,250,945 18,169,575 103,202,075 493,622,595 14,870,015 19,818,010 8,058,462 42,746,487 9,265,084 4,598,568 4,550,461 18,414,113 75,885,006 13,450,857 19,616,448 108,952,311 20,487 408,267 1,266,765 22,059 3,252 4,242,429 813,706 48,418 985,832 428,754 4,655,958 107,395 4,637,796 1,080,045 102,005 1,372,750 5,321 1,479,031 32,688,288 1,279,490 865,680 14,427,076 3,932 4,017 41,568,513 3,173,241 1,016,103 16,785,658 535,191,108 45,919,728 19,430,216 9,253 1,590,443 125,737,969 438,007 6,246,401 Others Total 488,160,874 6,456,659 25,704 279,496 66,029,441 22,136,983 9,761 29,014 83,089 43,996,460 256,571 279,496 159,274,533 713,464,848 29,014 83,089 2,108,137 74,943 573,231 74,657,626 788,122,474 Other Assets include Cash & Deposits with Central Bank, Due from Banks, Trading securities, Investment securities (net of Debt Securities), Investment Properties, Investment in associate, Property & Equipment, and Other Assets. 5,874,039 74,932 10,302 1,884,065 9,866,241 53,862,701 11 331,514 8,305,917 14,636,221 562,929 51,715,488 852,727 13 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 14 *This includes Saudi Arabia, Bahrain, Kuwait, Oman and Qatar. The Group's credit exposure by Geography and Economic activity, both funded and non-funded is detailed below (continued): GROSS CREDIT EXPOSURE BY GEOGRAPHY (continued) 31 DECEMBER 2019 Loans Other off-balance & Islamic Financing AED 000 Debt securities AED 000 Other Assets Total funded OTC Commitments AED 000 AED 000 AED 000 derivatives AED 000 sheet exposures AED 000 Total non-funded AED 000 Total AED 000 United Arab Emirates GCC excluding UAE* Arab League (excluding GCC) 362,994,299 12,706,195 7,753,561 Asia Africa North America South America Caribbean Europe Australia 70,763,176 32,006 621,867 4,547 19,097 19,657,795 228,171 8,551,578 6,897,187 99,122,010 469,013,496 10,609,427 14,720,132 38,035,754 4,203,077 9,057,404 21,014,042 13,584,103 28,794,283 113,141,562 899,630 931,636 2,162,356 11,335,801 5,909,574 226,719 102,600 1,995,963 3,893,082 958,354 37,373,015 949,307 47,175,671 516,189,167 71,581 74 Others Total 474,780,714 5,487,790 25,699 185,027 49,543,888 19,993,426 64,456 174,813,771 4,621 19,097 45,139,011 318,326 185,027 699,138,373 61,993 16 795,665 4,175 43,552 1,138,314 13,418,567 3,110 2,171 465 7,285 107,716 481 584,515 29,625 8,911,005 4,902,061 25,410 3,478 1,650,173 10 10,697,358 942,642 55,477,774 2,134,380 40,170,134 1,312,495 22,326,537 16,210,195 129,351,757 938,921 11,443,517 5,102 19,097 7,136,749 52,275,760 25,420 343,746 975,745 1,160,772 75,086,137 774,224,510 Other Assets include Cash & Deposits with Central Bank, Due from Banks, Trading securities, Investment securities (net of Debt Securities), Investment Properties, Investment in associate, Property & Equipment and Other Assets. بنك الإمارات دبي الوطني Emirates NBD *This includes Saudi Arabia, Bahrain, Kuwait, Oman and Qatar.#10The Group's credit exposure by Geography and Economic activity, both funded and non-funded is detailed below (continued): GROSS CREDIT EXPOSURE BY ECONOMIC ACTIVITY 31 DECEMBER 2020 Loans & Islamic Financing AED 000 Debt securities AED 000 Other Assets AED 000 Total funded AED 000 OTC Commitments AED 000 Agriculture, Fishing & Related Activities 8,579,700 339,596 8,919,296 15,483 derivatives AED 000 2,441 Other off-balance sheet exposures AED 000 Total non-funded AED 000 Total AED 000 774,574 792,498 9,711,794 Crude oil, Gas, Mining & Quarrying 5,123,120 Manufacturing 21,761,778 Electricity & Water Construction 2,588,871 530,613 106,107 727,029 5,653,733 214,341 629,295 22,497,180 374,390 3,315,900 17,859,286 Trade Transport, Storage & 30,976,505 13,391,988 52,945 172,296 27 90,540 17,859,286 31,029,477 13,654,824 88,959 274,188 868,836 87,589 91,125 223,942 909,951 333,221 1,729,844 283,100 1,318,984 1,624,450 7,278,183 7,721,148 8,319,480 30,816,660 289,276 1,288,186 4,604,086 12,466,138 13,073,547 30,932,833 8,852,126 11,450,806 42,480,283 1,366,641 1,737,330 15,392,154 Communication Financial Institutions and Investment companies Real Estate Services Sovereign 30,267,457 5,017,264 139,653,265 174,937,986 866,347 10,108,457 7,660,384 18,635,188 193,573,174 Personal All Others Add: Grossing up of interest in suspense 56,157,534 363,901 31,728,574 1,137,421 161,167,915 57,661,418 90,233,246 8,690,306 9,634,594 106 260,447 14,506,339 367,651 56,889,086 538,140 33,404,135 3,149,574 221,978,907 90,233,352 23,457,092 9,634,594 3,478,961 1,073,330 17,089 922,244 24,160 360,284 303,641 82,192 173,650 34,373 2,164,192 2,809,950 183,187 3,487,182 2,621,706 6,003,437 62,892,523 4,186,921 37,591,056 282,468 222,261,375 4,583,076 94,816,428 2,680,239 26,137,331 9,634,594 Total 488,160,874 66,029,441 159,274,533 713,464,848 8,305,917 14,636,221 51,715,488 74,657,626 788,122,474 15 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 Other Assets include Cash & Deposits with Central Bank, Due from Banks, Trading Securities, Investment Securities (net of Debt Securities), Investment Properties, Investment in associate, Property & Equipment and Other Assets. 16 The Group's credit exposure by Geography and Economic activity, both funded and non-funded is detailed below (continued): GROSS CREDIT EXPOSURE BY ECONOMIC ACTIVITY (continued) 31 DECEMBER 2019 Loans Other off-balance & Islamic Financing AED 000 Debt securities AED 000 Other Assets Total funded OTC Commitments AED 000 AED 000 AED 000 derivatives AED 000 sheet exposures AED 000 Total non-funded AED 000 Total AED 000 Agriculture, Fishing & 8,127,555 259,915 8,387,470 28,108 6 645,994 674,108 9,061,578 Related Activities Crude oil, Gas, Mining & Quarrying Manufacturing Electricity & Water Construction Trade Transport, Storage & 3,171,336 20,085,293 2,093,821 17,178,387 32,078,059 8,387,521 103,884 45,380 203,882 4,872 39,956 262,276 3,275,220 202,574 39,124 580,983 20,711,656 156,630 21 56,965 2,297,703 17,339,889 32,118,036 8,706,762 338,345 103,831 1,262,802 841,711 117,559 153,494 397,727 114,886 1,118,491 102,121 1,517,746 5,034,664 7,196,427 7,688,266 28,399,922 333,621 835,179 3,132,882 14,202,041 15,579,729 32,919,618 10,998,969 12,959,171 45,077,207 1,040,234 1,259,914 9,966,676 1,759,444 Communication Financial Institutions and Investment companies Real Estate Services 33,706,946 3,576,890 156,309,959 193,593,795 1,192,821 8,127,734 6,918,862 16,239,417 209,833,212 Sovereign Personal 51,918,225 505,133 33,672,954 610,725 163,193,353 42,500,483 83,349,075 All Others Add: Grossing up of interest in suspense 9,693,897 1,690,407 8,124,292 14,677,800 Total 474,780,714 49,543,888 174,813,771 499,372 52,922,730 387,780 34,671,459 1,884,340 207,578,176 6 83,349,081 26,062,104 8,124,292 699,138,373 1,956,842 906,090 128,970 1,016,573 814,779 253,358 244,554 2,334 126,055 17,474 3,024,370 3,412,649 232,696 3,684,894 2,269,271 5,234,570 58,157,300 4,563,293 39,234,752 364,000 207,942,176 4,827,522 88,176,603 3,101,524 29,163,628 8,124,292 8,911,005 10,697,358 55,477,774 75,086,137 774,224,510 بنك الإمارات دبي الوطني Emirates NBD Other Assets include Cash & Deposits with Central Bank, Due from Banks, Trading Securities, Investment Securities (net of Debt Securities), Investment Properties, Investment in associate, Property & Equipment and Other Assets.#11GROSS CREDIT EXPOSURE BY MATURITY The following table lists the Group's exposures by Residual Maturity: Other Less than 3 months Loans & Islamic Financing AED 000 209,178,824 Debt securities AED 000 13,539,598 Other Assets Total funded Commitments 3 months to 1 year 1 year to 5 years Over 5 years AED 000 AED 000 115,495,546 338,213,968 51,217,615 3,728,680 29,197,305 84,143,600 134,886,420 20,692,391 4,306,074 159,884,885 48,258,610 28,068,772 10,275,608 86,602,990 AED 000 797,214 OTC derivatives AED 000 2,089,268 off-balance sheet exposures AED 000 28,252,560 Total non-funded Total AED 000 31,139,042 AED 000 369,353,010 7,197,666 55,309 255,728 1,696,950 11,646,059 20,540,675 104,684,275 7,277,775 5,429,326 12,762,410 172,647,295 3,572,228 6,387,543 10,215,499 96,818,489 Add: Grossing up of interest in suspense & provisions 44,619,405 Total 488,160,874 44,619,405 44,619,405 66,029,441 159,274,533 713,464,848 8,305,917 14,636,221 51,715,488 74,657,626 788,122,474 31 DECEMBER 2020 17 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 Other Assets include Cash & Deposits with Central Bank, Due from Banks, Trading Securities, Investment Securities (net of Debt Securities), Investment Properties, Investment in associate, Property & Equipment and Other Assets. 18 GROSS CREDIT EXPOSURE BY MATURITY (continued) The following table lists the Group's exposures by Residual Maturity (continued): 31 DECEMBER 2019 Less than 3 months Loans & Islamic Financing AED 000 219,987,061 Debt securities AED 000 13,653,989 Other off-balance Other Assets Total funded OTC AED 000 123,556,739 AED 000 357,197,789 3 months to 1 year 50,751,926 1 year to 5 years Over 5 years 3,197,911 29,983,310 83,933,147 125,822,083 19,111,656 6,665,751 151,599,490 40,868,957 13,580,332 14,607,971 69,057,260 Commitments AED 000 906,323 7,584,677 168,882 251,123 derivatives AED 000 1,595,333 sheet exposures AED 000 26,496,428 2,488,162 13,327,647 4,500,477 8,463,609 2,113,386 7,190,090 Total non-funded AED 000 28,998,084 Total AED 000 386,195,873 23,400,486 107,333,633 13,132,968 164,732,458 9,554,599 78,611,859 Add: Grossing up of interest in suspense & provisions 37,350,687 37,350,687 37,350,687 Total 474,780,714 49,543,888 174,813,771 699,138,373 8,911,005 10,697,358 55,477,774 75,086,137 774,224,510 Other Assets include Cash & Deposits with Central Bank, Due from Banks, Trading Securities, Investment Securities (net of Debt Securities), Investment Properties, Investment in associate, Property & Equipment and Other Assets. بنك الإمارات دبي الوطني Emirates NBD#1219 The details of impaired loans by Geography and Economic Activity are as below: IMPAIRED LOANS BY ECONOMIC ACTIVITY Overdue (Gross of Interest in Suspense/ Provisions) Less than 90 days 90 days AED 000 and above AED 000 Total AED 000 Provisions Specific* AED 000 Adjustments General** AED 000 Write-offs AED 000 Write- backs AED 000 Interest in Suspense AED 000 Total Impaired Assets AED 000 Agriculture, Fishing & Related Activities 604,810 604,810 389,400 95 5 215,405 Crude oil, Gas, Mining & Quarrying Manufacturing Electricity and Water 68,945 68,945 Construction 2,007,467 644,493 5,386,679 Trade 3,210,847 2,007,467 644,493 5,386,679 3,210,847 66,122 1,426,703 1,424 1,399 13,686 19,956 269,240 311,524 449,478 4,471,826 2,415,817 219 318,157 80,764 105,666 83,229 1,148,394 672,230 194,796 (233,541) 122,800 Transport, Storage & 443,986 443,986 302,295 64,801 77,538 29,562 112,129 Communication Financial Institutions 8,996,997 8,996,997 5,775,097 137,079 1,856,907 1,364,993 Real Estate 7,954,101 Services Personal All Others Total 4,709,492 4,729,032 4,729,032 695,659 39,452,508 7,954,101 4,709,492 4,029,606 18,921 50,101 2,665,628 2,388,720 695,659 39,452,508 294,238 24,674,930 10,309,881 937,444 500,956 2,096,710 10,324 204,471 58,457 584,935 2,316,471 1,372,362 1,608,024 671,502 1,842,874 497,438 124,906 9,634,594 276,515 5,142,984 31 DECEMBER 2020 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 *Specific provisions represent Stage 3 Expected Credit Loss ('ECL). **General provisions represent Stage 1 and Stage 2 Expected Credit Loss ('ECL'). 20 IMPAIRED LOANS BY ECONOMIC ACTIVITY (continued) Overdue (Gross of Interest in Suspense/ Provisions) Less than 90 days 90 days and above Total AED 000 AED 000 AED 000 Provisions Specific* AED 000 Adjustments General** AED 000 Write-offs AED 000 Write- backs AED 000 Interest in Suspense AED 000 Total Impaired Assets AED 000 Agriculture, Fishing & Related Activities Crude oil, Gas, Mining & Quarrying 854,973 854,973 197,640 2,379 51,362 5 657,328 123,748 Manufacturing Electricity and Water Construction 1,144,631 35,207 4,369,449 Trade 2,985,637 123,748 1,144,631 35,207 4,369,449 2,985,637 24,604 37,671 8,474 1,070 98,074 561,255 90,202 187,273 117,489 465,887 102,064 3,184,267 10,112 2,181,261 194,608 67,399 163,253 138,363 (66,857) 1,052,929 132,253 649,815 154,561 Transport, Storage & Communication Financial Institutions 556,436 8,151,034 556,436 270,199 11,578 18,484 53,146 233,091 Real Estate Services Personal All Others Total 8,151,034 6,504,039 6,504,039 4,264,247 4,264,247 4,273,002 886,344 34,148,747 5,771,859 301,835 1,770,704 608,471 3,833,911 109,400 2,718,540 303,984 4,273,002 886,344 34,148,747 1,849,593 224,059 20,919,252 8,307,143 926,008 18,176 2,005,953 443,516 128,683 275,010 39,545 1,521,362 1,915,262 754,866 1,056,470 489,237 1,431,217 992,192 76,185 8,124,292 586,100 5,105,203 31 DECEMBER 2019 *Specific provisions represent Stage 3 Expected Credit Loss ('ECL). **General provisions represent Stage 1 and Stage 2 Expected Credit Loss ('ECL'). بنك الإمارات دبي الوطني Emirates NBD#1321 IMPAIRED LOANS BY GEOGRAPHY 31 DECEMBER 2020 Overdue (Gross of Interest in Suspense/ Provisions) Less than 90 days 90 days AED 000 and above AED 000 32,523,041 1,681,198 Total AED 000 32,523,041 1,681,198 Provisions Specific* AED 000 20,293,257 General** AED 000 Adjustments Write-offs Write-backs AED 000 1,608,527 AED 000 376,098 Interest in Suspense AED 000 9,061,690 Total Impaired Assets AED 000 3,168,094 1,279,997 166,404 499,090 (97,889) 295,926 295,926 4,644,496 4,644,496 187,480 2,715,427 5,537 12,808 46,927 61,519 482,646 19,374 11,041 1,918,028 12 118 12 8 4 118 81 37 299,939 299,939 190,942 10,251 15,846 93,151 7,778 7,778 7,738 40 39,452,508 39,452,508 24,674,930 10,309,881 2,096,710 584,935 9,634,594 5,142,984 United Arab Emirates GCC excluding UAE*** Arab League (excluding GCC) EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 Asia Africa North America Europe Others Total *Specific provisions represent Stage 3 Expected Credit Loss ('ECL). **General provisions represent Stage 1 and Stage 2 Expected Credit Loss ('ECL'). ***This includes Saudi Arabia, Bahrain, Kuwait, Oman and Qatar. 22 IMPAIRED LOANS BY GEOGRAPHY (continued) 31 DECEMBER 2019 Overdue (Gross of Interest in Suspense/ Provisions) Less than 90 days 90 days AED 000 and above AED 000 27,013,242 2,112,498 Total AED 000 27,013,242 2,112,498 Provisions Specific* AED 000 18,780,420 General** AED 000 Adjustments Write-offs AED 000 1,960,595 618,580 137,082 4,735,843 137,082 153,849 45,358 4,735,843 1,226,867 Write-backs AED 000 1,051,739 2,244 36,629 427,259 Interest in Suspense AED 000 7,688,704 Total Impaired Assets AED 000 544,118 388,733 1,105,185 27,613 (44,380) 8,187 3,500,789 22 161 22 161 18 51 4 110 149,890 149,890 139,439 3,491 11,055 (604) 9 9 28 (19) 34,148,747 34,148,747 20,919,252 8,307,143 2,005,953 1,521,362 8,124,292 5,105,203 United Arab Emirates GCC excluding UAE *** Arab League (excluding GCC) Asia Africa North America Europe Others Total *Specific provisions represent Stage 3 Expected Credit Loss ('ECL). **General provisions represent Stage 1 and Stage 2 Expected Credit Loss ('ECL'). ***This includes Saudi Arabia, Bahrain, Kuwait, Oman and Qatar. بنك الإمارات دبي الوطني Emirates NBD#1423 RECONCILIATION OF CHANGES IN PROVISION FOR IMPAIRED LOANS Balance at 1 January Add: Charge for the year 2020 29,226,395 AED 000 AED 000 2019 26,702,508 Specific Provisions (ECL Stage 3) 6,786,553 5,212,367 General Provisions (ECL Stage 1 and Stage 2) 1,673,921 Less: Write-off of impaired loans (2,096,710) (2,005,953) 1,419,340 Less: Recovery of loans previously written off Less: Write back/Recovery of loan loss provisions Less: Exchange and other adjustments of loan loss provisions Balance of provision for impaired loans as at 31 December EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 (584,935) (20,413) (580,505) (1,521,362) 34,984,811 29,226,395 24 24 On-Balance Sheet Gross Claims on sovereigns Outstanding AED 000 311,576,921 Claims on non-central Government public sector entities Claims on multi-lateral development banks 1,523,173 327,238 AED 000 91,359 368,117 Off-Balance Sheet Net Exposure after Credit Conversion Factors (CCF) Total Gross Exposure AED 000 311,668,280 Exposure Before CRM AED 000 311,668,280 Risk Weighted CRM AED 000 After CRM AED 000 Assets AED 000 311,668,280 45,887,566 Claims on banks 39,189,378 12,625,894 1,891,290 327,238 51,815,272 1,891,290 327,238 51,815,272 1,891,290 327,238 148,993 4,904,741 46,910,531 28,950,761 Claims on securities firms 540 540 540 37 503 503 Claims on corporate and Government Related Entities (GRE) 163,983,302 Claims included in the regulatory retail portfolio 55,622,692 219,605,994 Claims secured by residential property Claims secured by commercial real estate Past due loans Higher-risk categories Other assets Total 71,938,085 18,854,239 40,147,464 39,452,508 162,797 26,309,743 713,464,848 19,676 219,605,994 2,539,290 74,477,375 74,477,375 376,296 19,230,535 19,230,535 1,699,612 41,847,076 41,847,076 1,314,150 40,766,658 6,569,090 162,797 162,797 26,329,419 26,329,419 26,487,166 3,534,772 424 18,125 193,118,828 188,044,759 70,942,603 54,668,530 19,230,111 9,193,629 41,847,076 41,847,076 6,550,965 6,929,218 162,797 244,195 26,329,419 17,647,051 74,657,626 788,122,474 753,924,906 34,945,265 718,979,641 393,562,281 The Gross Credit Exposures as per Standardised Approach with the effect of CRM as detailed below: GROSS CREDIT EXPOSURE AS PER STANDARDISED APPROACH 31 DECEMBER 2020 بنك الإمارات دبي الوطني Emirates NBD#1525 GROSS CREDIT EXPOSURE AS PER STANDARDISED APPROACH (continued) 31 DECEMBER 2019 Gross Outstanding Claims on sovereigns AED 000 307,879,445 AED 000 209,279 On Balance Sheet Off-Balance Sheet Net Exposure after Credit Conversion Factors (CCF) Total Gross Exposure AED 000 308,088,724 Exposure Before CRM AED 000 308,088,724 CRM AED 000 After CRM AED 000 308,088,724 Risk Weighted Assets AED 000 41,060,094 Claims on non-central government public sector entities Claims on multi-lateral development banks Claims on banks 1,138,177 113,847 43,593,660 179,178 11,946,815 1,317,355 113,847 55,540,475 1,317,355 113,847 1,317,355 122,849 113,847 55,540,475 10,182,964 45,357,511 25,916,226 Claims on securities firms 3,929 3,929 3,929 3,929 3,929 Claims on corporate and Government Related Entities (GRE) Claims included in the regulatory retail portfolio 162,824,783 69,831,597 55,851,182 218,675,965 Claims secured by residential property Claims secured by commercial real estate Past due loans Higher-risk categories Other assets Total 16,699,384 39,243,989 34,148,747 273,191 23,391,553 699,138,373 218,675,965 3,201,183 73,032,780 73,032,780 16,699,384 16,699,384 2,374,493 41,618,482 41,618,482 1,275,233 35,423,980 6,380,436 273,191 273,191 44,845 23,436,398 23,436,398 75,086,137 774,224,510 745,180,966 25,726,364 4,644,960 192,949,601 190,959,340 1,211 68,387,820 52,871,754 16,698,173 8,127,016 41,618,482 41,618,482 21,050 6,359,386 7,777,137 273,191 409,787 23,436,398 16,424,596 40,576,549 704,604,417 385,291,210 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 26 GROSS CREDIT EXPOSURE AS PER STANDARDISED APPROACH (RATED/UNRATED) 31 DECEMBER 2020 Claims on sovereigns Claims on non-central government public sector entities Claims on multi-lateral development banks Claims on banks Claims on securities firms Claims on corporate and Government Related Entities (GRE) Claims included in the regulatory retail portfolio Claims secured by residential property Claims secured by commercial real estate Past due loans Higher-risk categories Other assets Total بنك الإمارات دبي الوطني Emirates NBD Rated AED 000 76,878,656 Unrated 743,364 327,238 AED 000 234,789,624 1,147,926 Total Gross Exposure AED 000 311,668,280 AED 000 311,668,280 Exposure Before CRM After CRM AED 000 311,668,280 Risk Weighted Assets AED 000 45,887,566 45,040,809 6,774,463 1,891,290 327,238 51,815,272 1,891,290 327,238 51,815,272 1,891,290 148,993 327,238 46,910,531 28,950,761 540 540 540 503 503 7,150,621 219,605,994 162,797 6,104,673 20,224,746 212,455,373 219,605,994 193,118,828 188,044,759 74,477,375 74,477,375 74,477,375 70,942,603 54,668,530 19,230,535 19,230,535 19,230,535 19,230,111 9,193,629 41,847,076 41,847,076 41,847,076 41,847,076 41,847,076 40,766,658 40,766,658 6,569,090 6,929,218 162,797 162,797 244,195 26,329,419 26,329,419 26,329,419 17,647,051 6,550,965 162,797 136,245,361 651,877,113 788,122,474 753,924,906 718,979,641 393,562,281#16GROSS CREDIT EXPOSURE AS PER STANDARDISED APPROACH (RATED/UNRATED) (continued) 31 DECEMBER 2019 Claims on sovereigns Rated AED 000 58,527,316 Unrated AED 000 249,561,408 Total Gross Exposure AED 000 308,088,724 Exposure Before CRM AED 000 308,088,724 After CRM AED 000 308,088,724 Risk Weighted Assets AED 000 41,060,094 Claims on non-central government public sector entities Claims on multi-lateral development banks Claims on banks Claims on securities firms 606,255 711,100 113,847 46,781,003 8,759,472 1,317,355 113,847 55,540,475 1,317,355 113,847 55,540,475 1,317,355 122,849 113,847 45,357,511 25,916,226 3,929 3,929 3,929 3,929 3,929 Claims on corporate and Government Related Entities (GRE) Claims included in the regulatory retail portfolio 4,158,325 214,517,640 218,675,965 218,675,965 192,949,601 190,959,340 27 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 Claims secured by residential property Claims secured by commercial real estate Past due loans Higher-risk categories Other assets Total 28 73,032,780 73,032,780 73,032,780 68,387,820 52,871,754 16,699,384 16,699,384 16,699,384 16,698,173 8,127,016 41,618,482 41,618,482 41,618,482 41,618,482 41,618,482 35,423,980 35,423,980 273,191 273,191 6,380,436 273,191 6,359,386 7,777,137 273,191 409,787 4,143,861 19,292,537 23,436,398 23,436,398 23,436,398 16,424,596 114,330,607 659,893,903 774,224,510 745,180,966 704,604,417 385,291,210 EXPOSURE SUBJECT TO DEDUCTION AS PER STANDARDISED APPROACH (RATED/UNRATED) 31 DECEMBER 2020 Claims on banks Claims on securities firms Claims on corporate and Government Related Entities (GRE) Claims included in the regulatory retail portfolio Claims secured by residential property Past due loans Total بنك الإمارات دبي الوطني Emirates NBD Exposure Rated AED 000 8,328,882 Unrated AED 000 58,048 Total Gross Exposure AED 000 8,386,930 Before CRM AED 000 8,386,930 After CRM AED 000 3,482,189 Risk Weighted Assets AED 000 1,741,095 37 37 37 61,897,416 7,737,014 61,897,416 7,737,014 61,897,416 7,737,014 35,410,250 4,202,242 35,410,250 3,151,682 424 424 424 8,328,882 51,948 69,744,887 51,948 78,073,769 18,125 78,039,946 43,094,681 40,303,027#17Total Gross Exposure AED 000 11,440,670 Exposure Before Risk Weighted Assets CRM AED 000 After CRM AED 000 AED 000 11,440,670 1,257,706 628,853 EXPOSURE SUBJECT TO DEDUCTION AS PER STANDARDISED APPROACH (RATED/UNRATED) (continued) 31 DECEMBER 2019 Claims on banks Claims on securities firms Claims on corporate and Government Related Entities (GRE) Claims included in the regulatory retail portfolio Claims secured by residential property 29 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 Past due loans Total 30 Rated AED 000 10,088,767 Unrated AED 000 1,351,903 411,654 10,500,421 68,561,987 1,211 93,049 79,062,408 59,231,272 59,642,926 59,642,926 7,884,552 7,884,552 7,884,552 1,211 1,211 93,049 46,413 79,015,772 33,916,562 33,916,562 3,239,592 2,429,694 25,363 38,439,223 25,363 37,000,472 CREDIT RISK MITIGATION AS PER STANDARDISED APPROACH 2020 2019 Gross credit exposure (AED 000) Risk weighted assets (AED 000) Gross credit exposure (AED 000) Risk weighted assets (AED 000) Gross exposure prior to credit risk mitigation Exposure covered by on-balance sheet netting 788,122,474 462,705,114 774,224,510 454,911,303 (34,197,568) (34,197,568) (29,043,544) (29,043,544) Exposure covered by eligible financial collateral (33,453,982) (33,453,982) (39,334,333) (39,334,333) Exposure covered by guarantees (1,491,283) (1,491,283) (1,242,216) (1,242,216) Net exposure after credit risk mitigation 718,979,641 393,562,281 704,604,417 385,291,210 بنك الإمارات دبي الوطني Emirates NBD#1831 RISK MANAGEMENT OBJECTIVES AND POLICIES MARKET RISK Please refer Note no. 49 in the annual financial statements for detailed risk management objectives, year-end VaR numbers, overall interest sensitivity in the Banking book and policies on Market Risk. QUANTITATIVE DISCLOSURES FOR EQUITY POSITION IN THE BANKING BOOK 31 DECEMBER 2020 (a) Quantitative Details of Equity Position EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 AED 000 FS Category (FVOCI/ Amortised Cost) 690,831 Basel II Category Current Year (Banking Book) 690,831 Publicly Traded 525,935 Privately Held 164,896 690,831 690,831 525,935 164,896 (b) Realised, Unrealised & Latent revaluation gains/(losses) during the year AED 000 Particulars FVOCI Туре Equities Collective investment schemes Any other investment Total Gains (Losses) Realised gains (losses) from sale and liquidations Unrealised gains (losses) recognised in the balance sheet but not through profit and loss account (468,848) Latent revaluation gains (losses) for investment recorded at cost but not recognised in balance sheet or profit and loss account Total (468,848) (c) Items in (b) above included in Tier I/Tier II Capital Tier Capital Amount included in Tier I capital (realised gains) Amount included in Tier II capital (unrealised gains) Total AED 000 Amount 32 QUANTITATIVE DISCLOSURES FOR EQUITY POSITION IN THE BANKING BOOK (continued) 31 DECEMBER 2020 (d) Capital requirements by Equity groupings Grouping Investments in associate Investment securities Held for trading Total capital requirement (e) Equity Investments (Quoted/Unquoted) - Including private equity investments Particulars Quoted Unquoted Total بنك الإمارات دبي الوطني Emirates NBD AED 000 Amount 29,236 100,170 129,406 Banking Book (Per Basel II Definition) 525,935 AED 000 Trading Book (Per Basel II Definition) 164,896 690,831#19AED 000 FS Category (FVOCI/ Amortized Cost) 1,346,378 Basel II Category (Banking Current Year Publicly Book) 1,346,378 Traded Privately Held 998,594 347,784 QUANTITATIVE DISCLOSURES FOR EQUITY POSITION IN THE BANKING BOOK (continued) 31 DECEMBER 2019 (a) Quantitative Details of Equity Position 33 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES - FOR THE YEAR ENDED 31 DECEMBER 2020 Туре Equities Collective investment schemes Any other investment 1,346,378 1,346,378 998,594 347,784 Total (b) Realised, Unrealised & Latent revaluation gains/(losses) during the year AED 000 FVOCI Particulars Gains (Losses) 34 Realised gains (losses) from sale and liquidations (65,295) Unrealised gains (losses) recognised in the balance sheet but not through profit and loss account 139,526 Latent revaluation gains (losses) for investment recorded at cost but not recognised in balance sheet or profit and loss account Total 74,231 (c) Items in (b) above included in Tier I/Tier II Capital Tier Capital Amount included in Tier I capital (realised gains) AED 000 Amount (65,295) Amount included in Tier II capital (unrealised gains) Total (65,295) QUANTITATIVE DISCLOSURES FOR EQUITY POSITION IN THE BANKING BOOK (continued) 31 DECEMBER 2019 (d) Capital requirements by Equity groupings Grouping Investments in associate Investment securities Held for trading Total capital requirement (e) Equity investments (Quoted/Unquoted) - Including private equity investments Particulars Quoted Unquoted Total بنك الإمارات دبي الوطني Emirates NBD AED 000 Amount 19,496 195,225 214,721 Banking Book (Per Basel II Definition) 998,594 347,784 1,346,378 AED 000 Trading Book (Per Basel II Definition)#20RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) Foreign Exchange Risk Foreign exchange risk hedging strategies are used to ensure that positions are always within established limits. The Group has a conservative policy towards foreign exchange risk and has set limits on positions by currency. Foreign exchange risk is measured using position reports showing the net long or short position for currencies which are monitored on a real-time basis. Foreign exchange risk is actively managed using spot and forward foreign exchange instruments. The capital requirement for foreign exchange risk as at 31 December 2020 is AED 269.55 million (as at 31 December 2019 is AED 129.73 million). Operational Risk Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies for Operational Risk. Liquidity Risk Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies for Liquidity Risk. Reputational Risk Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies for Reputational Risk. Regulatory/Compliance Risk Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies for Regulatory/Compliance Risk. Internal Audit's role in overall risk management Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies for details on Internal Audit's role in overall risk management. Risk management framework and processes at Emirates Islamic Bank (EI) Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies for details on Risk management framework and processes at El. Risk management framework and processes at DenizBank Please refer Note no. 49 in the annual financial statements for detailed risk management objectives and policies for details on Risk management framework and processes at DenizBank. 35 EMIRATES NBD BANK PJSC - BASEL II - PILLAR III DISCLOSURES FOR THE YEAR ENDED 31 DECEMBER 2020 36 بنك الإمارات دبي الوطني Emirates NBD