#1BNP PARIBAS BNP Paribas Investor Day Italy: Developing our Second Home Market Baudouin Prot Chief Executive Officer BNL Rome, December 1st 2006 Gruppo BNP PARIBAS#2BNP PARIBAS BNL BNP Paribas Strategy in Italy Jean-Laurent Bonnafé BNL Chief Executive Officer Gruppo BNP PARIBAS Rome, December 1st 2006#3BNP PARIBAS Disclaimer This presentation includes forward-looking statements based on current beliefs and expectations about future events. Forward-looking statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future events, operations, products and services, and statements regarding future performance and synergies. Forward-looking statements are not guarantees of future performance and are subject to inherent risks, uncertainties and assumptions about BNP Paribas and its subsidiaries and investments, developments of BNP Paribas and its subsidiaries, banking industry trends, future capital expenditures and acquisitions, changes in economic conditions globally or in BNP Paribas' principal local markets, the competitive market and regulatory factors. Those events are uncertain; their outcome may differ from current expectations which may in turn significantly affect expected results. Actual results may differ materially from those projected or implied in these forward-looking statements. Any forward-looking statement contained in this presentation speaks as of the date of this presentation: BNP Paribas undertakes no obligation to publicly revise or update any forward- looking statements in light of new information or future events. The information contained in this presentation as it relates to parties other than BNP Paribas or derived from external sources has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on the fairness, accuracy, completeness or correctness of, the information or opinions contained herein. None of BNP Paribas or its representatives shall have any liability whatsoever in negligence or otherwise for any loss however arising from any use of this presentation or its contents or otherwise arising in connection with this presentation or any other information or material discussed. The English version prevails BNL Grupp BNP PARIBAS Disclaimer 3#4BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Strategy in Italy Progress to Date Next Steps#5BNP PARIBAS BNL Grupp BNP PARIBAS Growing Profitably in Italy Invest for Growth Revitalise BNL's strong national franchise Boost BNP Paribas' existing activities Add a powerful distribution network to world-class product factories Control costs Optimise efficiency of Italian corporate centre and operations Strategy in Italy Three mutually reinforcing levers 5#6BNP PARIBAS BNL A Nation-wide Franchise Personnel headcount 17,000 Lombardia Trentino Altoadige Valle d'Aosta Priuli Venezia Giulia -Veneto Branches 895 Retail branches 703 Private centres 18 Emilia Romagna Piemonte Liguria Toscana ■ Corporate and P.A.* centres 80 Marche Umbria ■ Specialised subs. centres 94 Abruzzo Lazio. Client base 2.7mn Molise -Puglia Individuals 2.5mn Campania Basilicata Private Banking 11,000 Calabria ■Small Business 112,000 Sardegna Sicilia ■ Corporate and P.A.* 55,000 * Public Administrations BNL Grupp BNP PARIBAS A unique opportunity in the Italian market Strategy in Italy 6#7BNP PARIBAS Revenues / RWA in % 6.9* 5.9 5.8 BNL A Strong Upside Potential 5.1 54 42 4.2 Unicredit MPS Capitalia San Paolo IMI BPVN Banca Intesa 5.6 5.4 5.3 5.3 Antonveneta Cost/income 61.3 in % Unicredit BNL Grupp BNP PARIBAS (Source: 2005 company reports) Strategy in Italy 54.8 55.0 55.9 56.1 57.0 58.0 Banca Intesa Antonveneta BPVN San Paolo IMI [ BPU Capitalia MPS 64.8 BPU BNL BNL Banca Pop. It. 66.3 67.3 BPI 3.8 * 2004 figures 7#8BNP PARIBAS BNP Paribas in Italy before BNL ARVAL A BNP PARIBAS company Fleet Management BNP PARIBAS LEASE GROUP Leasing UCB BANCA Una società di BNP PARIBAS Residential Mortgages CARDIF A BNP PARIBAS company Insurance BNP PARIBAS ASSET MANAGEMENT BNP PARIBAS SECURITIES SERVICES Findomestic Banca BNP PARIBAS Private Banking Consumer Finance* Private Banking BNP PARIBAS REAL ESTATE BNP PARIBAS Asset Management Custody & Clearing Real Estate Services Corporate & Investment Banking A full range of powerful platforms with significant market positions BNL Grupp BNP PARIBAS * 50/50 JV with Cassa di Risparmio di Firenze Strategy in Italy 8#9BNP PARIBAS BNL Grupp BNP PARIBAS After BNL's Acquisition Our Ambitions for Italy Develop BNP Paribas second domestic market in Europe Become leader in Investment Banking in Italy • Strengthen our already significant market share in Asset Management and Specialised Financial Services ● Improve profitability by optimising quality of service, cost efficiency and risk management Strategy in Italy A new key player in the Italian banking market#10BNP PARIBAS Strengthen sales forces by introducing new tools, techniques and supports Retail & Private Focus on Innovation and Quality Set up real multi- channel distribution Dedicate sales forces through advanced segmentation Revamp and reinforce the network through branch renewals and openings A unique combination among Italian banks BNL Grupp BNP PARIBAS Strategy in Italy 10#11BNP PARIBAS Corporate Clients Leverage on BNL's Important Client base Revamping of the Corporate Centres Enhance relationship intensity through best practice marketing monitoring Dedicate coverage to Mid-Corporate and Public Administration Cross-selling with CIB and IRFS of specialised business lines An enhanced platform to address corporate clients needs BNL Grupp BNP PARIBAS Strategy in Italy 11#12BNP PARIBAS BNL Grupp BNP PARIBAS Large Corporates and Institutionals Roll-out Product Offer to a Larger Customer Base Strengthen Coverage CIB coverage extended to all large Corporates and Institutionals Numerous cross selling opportunities with Retail and Corporate Divisions Reinforce Local Teams to Enhance Product Delivery Top-notch financial solutions (Capital Markets, Corporate Finance,...) to support the development of Italian customers Provide Global Access Full access to CIB global platforms Unparalleled global reach (presence in 85 countries) The only CIB European leader with a strong local presence in Italy Strategy in Italy 12#13BNP PARIBAS BNL Grupp BNP PARIBAS AMS and IRFS A Larger Client Base for Successful Product Factories Unit Linked 4WD 4WD BNL BNL Перри АНГ РАНЕНАЯ Developed by BNP PAM Distributed by BNL 600mn in 3 weeks Early example of marketing success with AMS Strategy in Italy 13#14BNP PARIBAS BNL Grupp BNP PARIBAS Improved Efficiency Corporate Functions ALM already fully integrated within BNP Paribas framework Credit control and risk management to be aligned on BNP Paribas practices Procurement gains Central Platforms IT development methods improved to focus on business support Merge BNL CIB activities into BNP Paribas platforms Rationalisation of headquarters structure Network Restructuring of commercial branch organisation Back Office organisation redesign Human Resources 2,200 staff departures* combined with 900 hires over 3 years Full training programs and HR support in place Agreement reached with trade unions on the basis of BNL constructive long-term relationship *BNL SPA. Strategy in Italy 14#15BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Strategy in Italy Progress to Date Next Steps#16BNP PARIBAS BNL BNL acquisition announced Strong Momentum Launch of 2007 Commercial Action Plan New governance rules Investor Day | February | April | July | Sept. | Nov. | Dec. 1 BNP Paribas controls BNL Grupp BNP PARIBAS Strategy in Italy Presentation of the development plan to 500 executives Agreement with trade unions Detailed development plan finalised 16#17BNP PARIBAS New Business Organisation BNP Paribas-BNL Corporate & Investment Banking BNL banca commerciale Corporate Division Retail & Private Division Asset Management & Services BNP Paribas AM, Cardif, BNL Vita* BNL Gestioni, BNL Fondi Immobiliari International Retail Banking and Financial Services ARVAL, BPLG-Locafit UCB, Findomestic* BNP Paribas in working order in Italy BNL Grupp BNP PARIBAS * Findomestic: 50/50 JV with Cassa di Risparmio di Firenze; BNL Vita 50/50 JV with Unipol Strategy in Italy 17#18BNP PARIBAS BNL Grupp BNP PARIBAS New Business Organization A More Efficient Territorial Set-up Current: 12 "Aree Territoriale” Target: 5 Regions Nord Ovest Lombardia Toscana Umbria Lazio. Sardegna Sicilia -Triveneto Emilia Romagna Campania Basilicata Calabria Marche Abruzzo Nord Ovest (Milano) Puglia Molise Centro (Firenze) Lazio e Sardegna (Roma) Nord Est (Bologna) Sud (Napoli) Give the regions more autonomy and initiative Strategy in Italy 18#19BNP PARIBAS BNL All main Appointments Made and Know-How Transfer Underway Appointment of 1st/2nd line of management in June/July: New appointment: N. D'Anselmo as head of BNP Paribas-BNL CIB 2nd wave of appointments in September/December New entrance: S. Calderano as new head of Retail & Private Around 800 people from BNL and from BNP Paribas involved in integration working groups Ca. 30 professionals from BNP Paribas and 30 from BCG integrated in BNL Management and staff heading for growth Grupp BNP PARIBAS Strategy in Italy 19#20BNP PARIBAS Streamlining day to day Management Alignment within BNP Paribas' governance rules Empowerment of the line managers ■Full powers given to the Management by the Board Simplified and more business-oriented managerial approach ■ Example: request and treatment of bottom up indication of bottlenecks in the Retail network A more flexible and responsive organisation BNL Grupp BNP PARIBAS Strategy in Italy 20 20#21BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Strategy in Italy Progress to Date Next Steps#22BNP PARIBAS Commercial Action Plan for 2007 for each business area Launch pilots (Retail, Corporate, Back Offices) The Steps Ahead Implement further quick wins Kick off 11-12 December in line managers' conventions First regions reorganized by March 2007 Before mid-2007 Shifting from planning to execution: from 170 working groups to 450 projects BNL Grupp BNP PARIBAS Strategy in Italy 22 22#23BNP PARIBAS Synergies Reviewed Upwards Total synergies 2009 (impact on gross operating income) in Єmn 480 +20% 400 210 150 Net Revenue Synergies 250 270 Cost Synergies More ambitious targets on the basis of the bottom-up analysis BNL Grupp BNP PARIBAS Strategy in Italy 23 23#24BNP PARIBAS BNL Grupp BNP PARIBAS Successful Integration Underway Integration proceeding at a fast pace Motivated teams committed to deliver ambitious targets 2007 commercial plan ready to go Strategy in Italy 24 24#25BNP PARIBAS BNL Gruppo BNP PARIBAS BNP Paribas Strategy in Italy Financial Elements Angelo Novati BNL Chief Financial Officer Rome, December 1st 2006#26BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Introduction From Gruppo BNL to BNL bc Restructuring Costs and Balance Sheet Adjustments Details on Synergies Conclusion#27BNP PARIBAS A Powerful Process Combine BNP Paribas and BNL teams and figures Apply base line growth scenario Quantify revenue and cost synergies Implement P&L harmonisation Headcounts and P&L figures provided to each workgroup •Assumptions based on BNL IBES consensus ■+5.8% revenue base line CAGR ■+2.3% costs base line CAGR 270mn Cost synergies ● 210mn Net Revenues synergies Monitoring of achievements by project Synergies by core business to be reported on a quarterly basis BNL Grupp BNP PARIBAS Phase 1 (May-July) 45 taskforces, 250 people involved Financial Elements Phase 2 (Sep-Dec) ⚫ 170 workgroups, about 800 people involved 27#28BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Introduction From Gruppo BNL to BNL bc Restructuring Costs and Balance Sheet Adjustments Details on Synergies Conclusion#29BNP PARIBAS BNL 9M06 In €mn Revenues Costs Gross Op. Income From Gruppo BNL to BNL Group Contribution Group contribution incl 1Q06 proforma 2,233 (1,400) 833 Cost of risk (245) Operating Income 588 Pre-Tax Income 579 Not comparable with BNL published accounts Detailed reconciliation in appendix Costs: 9M usually understates the yearly trend "Seasonal" effect Cost of risk: higher in Group contribution than under Italian practices Provisions time value for money: reducing cost of risk under Italian practices vs. increasing revenues under BNP Paribas practices ■ Provisions for credit-related litigations: in costs under Italian practices vs. in cost of risk under BNP Paribas practices BNL Grupp BNP PARIBAS Financial Elements 29 29#30BNP PARIBAS Cost of risk Italian practices 32 48 Cost of Risk A Different Benchmark Cost of risk Group contribution 56 65 BNL Grupp BNP PARIBAS in bp BNL 9M06* Peers** 9M06 in bp BNL 9M06 Under Italian practices, BNL cost of risk lower than peers ■Due to high level of write-backs since 2005 Group contribution not comparable with Italian peers 9M06 BNL cost of risk to be broken down between Low cost of risk in activities to be transferred to CIB and IFRS ■ 65 bp in retail and commercial banking (BNL bc) BNL bc 9M06 Cost of risk optically higher than under Italian practices * excluding the one off impact of alignment to BNP Paribas balance sheet adjustments (€378mn) ** Peers' average includes Banca Intesa, Capitalia (as published), Unicredit, San Paolo IMI, MPS (BNL estimates) Financial Elements 30#31BNP PARIBAS 9M 06 Revenues* Before Reorganisation 2,233 From BNL Group Contribution to BNL bc A New Revenue Split BNL Contribution 9M 06 Revenues* After Reorganisation 1,870 BNP Paribas Italy 1,855 420 in Єmn BNL contribution 365 346 171 137 346 119 24 228 129 142 in €mn 74 52 AMS BNL bc IRFS AMS CIB Corporate Centre Creation of a new BNL banca commerciale core business (BNL bc) dedicated to Retail and Corporate activities Re-allocation of revenues, costs, cost of risk and allocated capital of the other BNL activities to relevant BNP Paribas core businesses BNL Grupp DHE PARIBAS *including proforma 1Q06 figures Financial Elements 31#32BNP PARIBAS From BNL Group Contribution to BNL bc Future Disclosure 9M06 - BNL contribution BNL bc Revenues 2,233 In Єmn 1,870 Costs (1,400) Gross Op. Income 833 (1,247) 623 Cost of risk (245) (228) Operating Income 588 395 Pre-Tax Income 579 386 Cost/Income ratio 62.7% 66.7% RWA (9M average) 66.3bn 47.1bn BNL bc will become the standard for reporting starting January 1st 2007 BNL Grupp BNP PARIBAS Financial Elements 32 32#33BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Introduction From Gruppo BNL to BNL bc Restructuring Costs and Balance Sheet Adjustments Details on Synergies Conclusion#34BNP PARIBAS Other 15% IT and reengineering 49% Restructuring Costs by 2009 €410mn Restructuring Costs Restructuring Costs Expected Timing Completion HR 36% 152 129 129 in €mn 2006 2007 2008 • Total restructuring costs revised to 410mn down from 450mn ■Lower than expected HR restructuring costs ■Reduction impacting 2006 exclusively ● Actual amounts charged will be disclosed quarterly in the BNP Paribas Corporate Centre as operating expenses BNL Grupp BNP PARIBAS Financial Elements 34#35BNP PARIBAS Purchase adjustments* Balance Sheet Adjustments 378 308 100 23 48 87 850 in €mn Credit risk Early Tangible & Retirement activities & int. assets & Employee securities Market Other TOTAL Benefit BNL Grupp BNP PARIBAS Balance sheet adjustments revised upwards from 800mn to 850mn ■ Due to higher contingent liabilities on BNL existing early retirements schemes Post tax impact 607mn Financial Elements *Unaudited figures 35 35#36BNP PARIBAS Impaired Loan Coverage Best Practice in Italy • BNP Paribas risk assessment methods applied to BNL ■Limited need for new specific provisions Widened scope of doubtful loans: integration of past due amounts over 90 days' ■ Coverage of both past due categories at 36% whilst negligible for peers ■ Enforcement of the BNP Paribas portfolio provisioning method BNL coverage ratio already high in Italy and further increased NPL + SUBSTANDARD + RESTRUCTURED LOANS PAST DUE > 180 days PAST DUE 90-180 days 59% 58% 53% 20% BNL Dec05 BNL Peers Jun06 average* Jun06 36% 36% 6% 0% n.s. BNL Dec05 BNL Peers BNL Jun06 average* Dec05 Jun06 BNL Peers Jun06 average* Jun06 BNL Grupp BNP PARIBAS *Peers' average includes Banca Intesa, Unicredit, San Paolo IMI, Capitalia, MPS Financial Elements 36#37BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Introduction From Gruppo BNL to BNL bc Restructuring Costs and Balance Sheet Adjustments Details on Synergies Conclusion#38BNP PARIBAS BNL Grupp BNP PARIBAS Net Revenue Synergies by 2009 222 Revenue Synergies Split by Business Line 380 Gross Revenue Synergies Marginal Costs 90 86 210 150 41 104 31 63 Net Revenue Synergies in Єmn 20 23 -11 -18 -23 -118 -170 Financial Elements BNL bc IRFS AMS CIB Total by Acquisition 2009 estimate Main revenue synergies generated by BNL bc and CIB +40% vs initial estimate 38 38#39BNP PARIBAS Gross Revenue Synergies Revenue Synergies Revised Timing Cumulative Revenue Synergies 2007-2009 380 Marginal Costs 224 79 210 Net Revenue Synergies 109 in Єmn 19 -60 -116 -170 2007 2008 2009 BNL Grupp BNP PARIBAS To be added to cost and revenue baselines • First wave of revenue synergies to be achieved by 2009 ■2007: include negative revenue synergies ( 24mn in CIB) ■2008: in line with initial forecasts; 2009: ahead Marginal costs include "Piano Sportelli" net implementation costs ■"Piano Sportelli": 100 new branches by end 2009 ■ Expected revenues to fuel a second wave of revenue generation beyond 2009 Financial Elements 39#40BNP PARIBAS BNL Grupp BNP PARIBAS Total Cost Synergies by 2009 CIB (by Business) Increased Cost Synergies Total Cost Synergies by 2009 (by Nature) 13% IRFS 2% AMS 5% Total: €270mn Other 9% IT 18% BNL functions and operations 80% Procurement 15% Total cost synergies raised to 270mn compared to 250mn announced at the time of acquisition Agreement signed with the unions ■2,200 staff departures over the period Financial Elements HR 58% 40 40#41BNP PARIBAS Cost Synergies Progression Cost Synergies Timing Accelerated 270 185 100 38 in Єmn 2006 2007 2008 2009 Initial timing forecast exceeded due to effectiveness of actions already implemented 38mn cost synergies in 2006 representing quick wins in procurement and recruitments Synergies to be deducted from cost baseline progression BNL Grupp BNP PARIBAS Financial Elements 41#42BNP PARIBAS Main Cost Efficiency Projects & Initiatives (1/2) Organisation redesign HR synergies Integrating investment banking activities under CIB core business • Integrating major affiliates and foreign branches into BNP Paribas' operating structure • Rationalising headquarter functions and reviewing reporting structure to allow local management to be more business-focused • Reviewing and simplifying branch. network organisation Trade union negotiations finalised for BNL SPA HR plan shared and agreed in details. with trade unions • Contained repercussions on staff as shared objective with trade unions • Redundancies on a voluntary base with contribution by BNL utilising "Fondo ABI❞ ● Training programme for staff involved in functional mobility Creation of HR co-ordination units within the 5 regions BNL Grupp BNP PARIBAS Financial Elements Improved flexibility and efficiency 42#43BNP PARIBAS BNL Grupp BNP PARIBAS Main Cost Efficiency Projects & Initiatives (2/2) Procurement synergies Efficiency improvement initiatives Consolidating Group purchasing volumes in Italy and leveraging global BNP Paribas' contracts/scale ■ Technology (hardware and software, telecom, other systems) ■■Bank services (ATMs, mail, payment systems) Professional services Information services ■IT: upgrading quality of information systems and reducing development activities, leveraging on proven BNP Paribas' platforms ■ Real estate: optimising headquarter and international network sites Financial Elements Optimised functions 43#44BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Introduction From Gruppo BNL to BNL bc Restructuring Costs and Balance Sheet Adjustments Details on Synergies Conclusion#45BNP PARIBAS Conclusion Cost and revenue synergies revised upwards as a result of a comprehensive analytical work Overall balance sheet and restructuring costs confirmed New disclosure framework defined BNL Grupp BNP PARIBAS Financial Elements 45 45#46BNP PARIBAS BNL Gruppo BNP PARIBAS BNP Paribas Retail Banking in Italy Stefano Calderano Head of BNL Retail and Private Division Rome, December 1st 2006#47BNP PARIBAS A New Challenge BNL A nationwide recognised brand name + BNP PARIBAS A European leader willing to develop a new domestic market A new success story on the Italian retail market BNL Grupp BNP PARIBAS Retail Banking in Italy 47#48BNP PARIBAS Retail & Private Division Customers 2.6mn customers, of which 2.5mn Individuals customers 112,000 Small Business customers 11,000 Private Banking clients Sales points 703 Branches 18 Private banking centres (+ 13 "Presidi") 1,270 ATMs People 7,134 total resources, of which 5,243 in direct customer contact roles 2,200 Individual customer RMS 400 Small Business managers 150 Private Bankers BNL Grupp BNP PARIBAS Retail Banking in Italy 48 48#49BNP PARIBAS Key Opportunities in the Italian Market (1/2) 1 Underdeveloped product segments ■Mortgage penetration 15% in Italy v.s. 40% European Average (EA) ■Consumer Credit product penetration 5% v.s. 15% EA ■Life insurance and pension funds penetration 25% v.s. 45% EA Sources: Bank of Italy, European Central Banks, BNL studies 2 Customer satisfaction as key driver for growth ■Low level of customer satisfaction compared to European average Service level as one of main driver of dissatisfaction ■ High potential for a player with European best practices BNL Grupp BNP PARIBAS Retail Banking in Italy 49 49#50BNP PARIBAS Key Opportunities in the Italian Market (2/2) 3 A large Small Business market not always well served ■5mn companies, 200bn of lending, high revenues per customer ■Limited management skill for a number of them ■ Undifferentiated product offer, lack of specific focus, complex credit process 4 A still fragmented market ■Market focus on consolidation (Banca Intesa-Sanpaolo, BPVN-BPI, BPU-BL, ...) High potential and good timing BNL Grupp BNP PARIBAS Retail Banking in Italy 50 50#51BNP PARIBAS A Client Centric Response Know our clients better Segmentation Adapting to our clients' expectations Offering Getting closer to our clients Multi-channel Service model Increase customer satisfaction BNL Grupp BNP PARIBAS Retail Banking in Italy 51#52BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Segmentation: Know your Customer Better Offering: Adapt to Client Expectations A new Service Model: Getting Closer to our Clients Already Started Conclusion#53BNL Grupp BNP PARIBAS BNP PARIBAS Individual Customers More Dedicated and Specialised Client Management Current BNL model Target model 2.5 mn clients Managed by dedicated RM 13% 30% 87% Managed by pool of Account Managers 70% Segments based only on financial wealth Segments based on financial wealth, age, profession, potential, product usage Adapting to client relationship needs Retail Banking in Italy 53 53#54BNP PARIBAS BNL Current BNL model Grupp BNP PARIBAS Small Business Adapt to Customers' Profile Target model 112,000 clients Managed by dedicated RM at Group level All clients below €1.5mn at branch level Managed by dedicated RM Small Corporate 100 clients/ RM Another RM for Private Side Small Office Home Office (e.g. shop owners,artis., professionals • No segmentation • No dedicated management of private side • 300 clients/ RM 250-300 clients/ RM ⚫ One single RM managing both private and business sides Better serve clients with increasing needs Retail Banking in Italy 54 5.4#55BNP PARIBAS Private Banking Better Serve Existing Clients, Attract New Ones Current BNL model Target model Private €1mn financial assets Retail Client segmentation based on financial resources Limited differentiation between Private and Retail offers 11,000 Private banking clients €5mn financial assets €0.5mn financial assets HNWI Segmentation with dedicated service model Retail "Auto-segmented" clients Segmentation based on financial assets and upside potential Comprehensive offering distinct from the standard Retail one Develop referrals with Retail, Small Business, Corporate and CIB BNL Grupp BNP PARIBAS Retail Banking in Italy 55 55#56BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Segmentation: Know your Customer Better Offering: Adapt to Client Expectations A new Service Model: Getting Closer to our Clients Already Started Conclusion#57BNP PARIBAS Individuals Specialised and Innovative Product Offering Current accounts New multichannel current account New product for young customers Revision of packaged accounts Personal loans 0 Adapt amount and duration to client profile Mortgages Savings Extend duration Relaunch variable rate fixed payment mortgage ●Revamped product offering Full access to leading edge Group product innovation BNL Grupp BNP PARIBAS Retail Banking in Italy 44 57#58BNP PARIBAS BNL Grupp BNP PARIBAS Small Business New Product Offering Fleet management ◆ New Company car fleet management (Arval) Leasing Current Account Credit Leasing: Enhanced leasing process and tools (Locafit/ BNP Paribas Lease Group) Modular Current Account: Increased customization and flexibility through tailor made banking and extra-banking services Flexible/hybrid short term credit lines. Packaged medium term loans Other specific products > Purchasing cards Retail Banking in Italy Better serve client needs 58 58#59BNP PARIBAS Private Banking Completely Renewed Service and Product Offering Client Relationship Global wealth management ■Fiduciary services. Tax and legal counseling Real estate and art advisory ■International Private banking Product Offering Service Offering Investment products Sicav/hedge funds ■Structured products ■■Unit linked, Index linked ■ Credit (leverage) Portfolio management approaches ■Discretionary management ■ Advisory service/ fee based BNL Grupp BNP PARIBAS Retail Banking in Italy 59 59#60BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Segmentation: Know your Customer Better Offering: Adapt to Client Expectations A New Service Model: Getting Closer to our Clients Already Started Conclusion#61BNP PARIBAS A More Effective and Accountable Structure Current BNL Model Retail & Private Division Private Banking Centers Mercati 12 Zone 64 Retail branches 18 +13 703 Target Model Retail & Private Division Regions Groups 31 Private Banking Centers Retail branches 18+ 13 703 Reinforced territorial responsibilities BNL Grupp BNP PARIBAS Retail Banking in Italy 61#62BNP PARIBAS Refocused and Reintegrated Branch Model Current BNL Model Retail & Private Division Operations Division Branch Zone Branch Manager Head of tellers Small Business relationship managers Mass market sales- people Affluent relation- ship manager Tellers Target Model Retail & Private Division Branch Groups Small Business relationship managers Tellers Branch Manager Individuals Segment A Relat. Manag. Individuals Segment B Relat. Manag. Reception BNL Grupp BNP PARIBAS Strengthen the role of Branch Manager Develop an integrated team culture within the branch Retail Banking in Italy 62 62#63BNP PARIBAS A new Branch Layout to Improve the Service to Clients. Advisor Offices Tellers Reception ATM area Services area Entrance BNL Grupp BNP PARIBAS 250 existing branches to be renovated in 3 years ● All new openings will be done according to new branch lay-out All network to be restyled by 2009 Retail Banking in Italy 63 65#64BNL BNP PARIBAS "Piano Sportelli" to Generate Medium Term Organic Growth Base expansion on geomarketing rationale ■ Focus on urban, high-end customers ■ Focus on areas with good BNL footprint ● Deepen territorial coverage ■ 100 new branches by 2009 ■Full income generation capacity from 2011 Limited start up costs ■Fully posted by 2009 ■ Cost/Income by 2011: 45% Preparing a second wave of revenue growth Grupp BNP PARIBAS Retail Banking in Italy 19 64#65BNP PARIBAS Get Closer to the Client Anytime : the Integrated Multi-Channel System From a bank with multiple forms of access... to an integrated multi-channel banking BNL Grupp BNP PARIBAS Branch network ATM Internet Mobile Phone Internet Customer Relations Center CRC Telephone ? reception services Call centres A virtuous circle Profitability Loyalty Branches Inter- active Voice Servers Specialised after-sales services Contact + Service = Sales Satisfaction Leveraging BNP Paribas know-how and skills Retail Banking in Italy 65 59#66BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Segmentation: Know your Customer Better Offering: Adapt to Client Expectations A new Service Model: Getting Closer to our Clients Already Started Conclusion#67BNL Grupp BNP PARIBAS BNP PARIBAS Actions Already Undertaken and Quick Wins Simplified sales contracts already delivered to the network Marketing campaigns already launched Intragroup referrals started Commercial action plan for 2007 launched by mid December Rebranding campaign about to start Retail Banking in Italy 67 10#68BNP PARIBAS Index Linked Life Insurance First Achievements Unit Linked 4WD €400mn in 1 month Product Index Linked Life Insurance Placement period 19 August - 29 September 2006 Length 5 years €600mn in 3 weeks instead of €450mn in 8 weeks Product Guaranteed Unit Linked Placement period 9 October 12 December 2006 - Underlying fund Parworld Absolute Return 100 Guaranteed 2012 Length 6 years Guarantee 100% BNL Grupp BNP PARIBAS A promising success evidencing strong staff commitment Retail Banking in Italy 68 80#69BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Segmentation: Know your Customer Better Offering: Adapt to Client Expectations A new Service Model: Getting Closer to our Clients Already Started Conclusion#70BNP PARIBAS BNL Grupp BNP PARIBAS Committed to Delivering the Synergies Total 2009 BNL bc Retail & Private Banking Division Synergies 159 -102 202 145 in €mn Gross Revenue Marginal Costs Synergies Cost Synergies Total Synergies 90 projects aimed at delivering €202mn synergies Retail Banking in Italy 70#71BNP PARIBAS Conclusion Offer a differentiated banking experience to our clients Intensive change management program to reshape the network and commercial set-up Leverage on BNP Paribas' experience and expertise BNL Grupp BNP PARIBAS Retail Banking in Italy 71#72BNP PARIBAS BNL Gruppo BNP PARIBAS BNP Paribas Asset Management and Services in Italy Alain Papiasse Head of Asset Management and Services Isabella Fumagalli Head of Cardif Italy Rome, December 1st 2006#73BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview AMS Overview Strategy in Italy Development Plan Conclusion#74BNP PARIBAS A Major Asset for BNP Paribas A substantial part of the Group* 16% of revenues ■■15% of allocated capital Revenues 9M06: €3.2bn Real Estate Services Cortal Consors 8% 11% Insurance 30% Wealth & Asset Management 49% Private AMS Banking 17% Asset Management 13% Securities Services 21% ● A major presence in the asset gathering and management business ■ Assets under management ■ Assets under custody ■ Assets under administration 476bn 3,430bn +15% 30.09.05 +19% 30.09.05 569bn +18% 30.09.05 BNL Grupp BNP PARIBAS Excluding BNP Paribas Capital and other activities Asset Management and Services 74#75BNP PARIBAS A high capacity to generate revenues AMS: a Fast Growing Platform A strong inflow generation Revenues Asset inflow rate* 3,552 +25.1% 3,044 2,616 3,208 4.6% 4.4% 2,565 In Єmn 2003 2004 2005 9M06 9.9% 9.8% 2003 2004 2005 9M06 *Annualised rate as a % of AuM A major growth engine for BNP Paribas BNL Grupp BNP PARIBAS Asset Management and Services 75#76BNP PARIBAS BNL Grupp BNP PARIBAS Gather Retail network External distribution Independent advisors On-line distribution Covering the Entire Investment Cycle BNP PARIBAS FAUCHIER PARTNERS Cortal Consors BNP PARIBAS *ASSET MANAGEMENT FFTW Manage Advisory & discretionary portfolio management Sophisticated solutions Real estate funds FundQuest A BNP PARIBAS company Multi-management BNP PARIBAS IMMOBILIER Administrate Custody and fund administration Employee savings plans Property management BNP PARIBAS * SECURITIES SERVICES Atisreal Asset Management and Services CARDIF A BNP PARIBAS company BNP PARIBAS ASSURANCE Protect Life insurance Creditor insurance Protection Property & Casualty 76#77BNP PARIBAS BNL Grupp BNP PARIBAS Businesses Leaders in their Markets Global #2 in mutual fund promotion in France ■ Leader in multi- Asset Management management in Europe ☐ #1 in France Private Banking In Italy before BNL ■ One of the foreign asset manager leaders in external distribution ■ One of the top foreign private banks operating in Italy #3 in Western Europe #7 in Asia and Latin America ■ Leader in Real Estate Services in Continental Europe #4 in life insurance in France #2 in creditor insurance world-wide ■ #1 in Europe ■ #5 world-wide Real Estate Services Insurance ■ Recent acquisitions by BNP Paribas ■ Leader in creditor insurance for financial institutions Securities Services #3 in Italy Asset Management and Services Top rated in Italy (Global Custodian) 77#78BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview AMS Overview Strategy in Italy Development Plan Conclusion#79BNP PARIBAS Italy: Growing Asset Gathering Market Large and attractive Asset Management market Second retail market in Europe, getting more sophisticated Institutionals are moving from conservative asset allocation to performance products • Lower life insurance penetration compared to other European countries Positive impact on life insurance expected from future reforms on pensions & retirement services and tax inheritance Evolution of AuM per investment type CAGR 2002-2005 Life insurance premiums +23.9% 1,053 CAGR 1999-2005 911 851 +12.8% 73.5 65.6 62.8 55.3 553 46.3 39.8 35.6 in €bn in €bn 2002 2003 2004 2005 1999 2000 2001 2002 2003 2004 2005 Collective funds Life insurance - Retail GPM & GPF Others BNL Grupp BNP PARIBAS Asset Management and Services Sources Assogestioni, ANIA 79#80BNP PARIBAS The New Face of Asset Management & Services in Italy A significant contribution for the group ■ Assets under management: 60bn ■ Assets under custody: 346bn A combination of production and distribution platforms: Real Estate BNL Fondi Immobiliari Securities Services In house Asset Management Insurance BNL Gruppo BNP PARIBAS BNL Gestioni SGR BNL Vita BNP PARIBAS BNP PAM SGR Centrovita Cardif BNP Paribas Dvpt. Mgt. BNP Paribas Property Mgt. BNP Paribas Securities Services (BP2S) Atis Real BNL Enlarged Client base and coverage Retail, Private, Corporates & Institutionals, Third party distribution Grupp BNP PARIBAS Asset Management and Services 80 60#81BNP PARIBAS BNL: Large Potential for Asset Gathering BNL client assets Asset gathering life insurance, mutual funds and discretionary management 35% Assets 20% under custody BNL bonds 15% ● Give access to BNL clients to more sophisticated products adapted to their needs and risk return profile ■ Transform assets under custody into asset gathering ■ Progressively transform BNL bonds into asset gathering demand Current accounts 30% BNL Grupp BNP PARIBAS Source: BNL estimates as of 31 December 2005 Asset Management and Services 81#82BNP PARIBAS BNL Grupp BNP PARIBAS BNL's Individuals market share per product Retail Clients 5.0% 5.0% Greatest development potential 4.1% 3.0% 1.0% Average Managed Life insurance individual client Funds in unit-linked Life insurance Mortgages penetration Increase asset gathering market share Source: GFK Eurisco, Assogestioni, Assofin, ANIA, latest data available Asset Management and Services 808 82#83BNP PARIBAS Retail Clients Differentiated << asset gathering » offering for each client segment ■ 2.6mn current retail and private clients to be leveraged New product range of mutual funds and discretionary portfolio management ■ Rationalised range of funds for each client segment ■ Structured funds ■ Dynamised interaction between the network and the asset gathering producers Innovative range of life and creditor insurance products ■Leverage on BNP Paribas Assurance expertise in France and leading position world-wide on creditor insurance ■ Coordinated and best-in class offering: BNL Vita and Cardif product range BNL Grupp BNP PARIBAS Asset Management and Services 83#84BNP PARIBAS International Private Clients BNP Paribas Private Bank expertise and products & services offering to develop BNL Italian and international private client franchise WEALTH MANAGEMENT INVESTMENT SERVICES INVESTMENT PRODUCTS Tax & Estate Planning Money Market Discretionary Management Fiduciary Services Active Advisory Securities Mutual Funds Structured Products & Derivatives Diversification (real estate, property, art) Advisory Mandate Alternative Investments Life Insurance BNL Grupp BNP PARIBAS Asset Management and Services Execution Credit 84#85BNP PARIBAS Institutional and Corporate Clients Leverage on BNL's clientele to propose AMS' enhanced capabilities Asset Management ■ Among BNL's current 1,500 institutional clients, identify those with potential to increase AuM ■ Among BNL's 52,000 corporate and public administration clients, select those with high potential Securities Services ■ Custody, fund administration and other securities services for BNL and external clients Real Estate Services ■ Extended range of real estate services through BNP Paribas Real Estate Services recent acquisitions in Italy and BNL Fondi Immobiliari offers BNL Grupp BNP PARIBAS Asset Management and Services 85 85#86BNP PARIBAS Third Party Distribution Enhanced platforms to gain more external and third party clients Securities Services ■Develop new client relationships and partnerships with BNL institutional clients • Asset Management ■ Extended platform in Italy to propose a wider range of products to existing and new partners ■■Provide BNL and third parties clients with fund management and selection by the development of FundQuest Italy ● Insurance ■Through BNL Vita and Cardif, extended capabilities on insurance to serve new clients and partners A leading investment platform for external distribution and partners BNL Grupp BNP PARIBAS Asset Management and Services 86 86#87BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview AMS Overview Strategy in Italy Development Plan Conclusion#88BNP PARIBAS Development Plan New Organisation to Coordinate Business Development A new organisation in order to support the asset gathering platforms and sales force vis a vis the client network AMS Italy Marketing Optimise workflows within producers and distributors: best-in-class asset gathering offering Sales Management Promotion and training for the network sale force in order to achieve business action plan Economic Management Budget and results monitoring ■ Transform progressively BNL's asset base into asset gathering products according with client risk profile ■ Optimise product range and create different offering for each client segment ■ Develop training and support for the BNL network ■Cross-sell with the AMS business lines in Italy and abroad BNL Grupp BNP PARIBAS Asset Management and Services 88#89BNP PARIBAS Development Plan Private Banking Merged BNP Paribas Private Banking activities in Italy with BNL Extended best-in-class products to BNL Private Banking in Italy based on BNP Paribas Private Bank expertise BNL Private Banking entities merged with BNP Paribas in Switzerland and in Luxembourg BNL Grupp BNP PARIBAS Asset Management and Services 89#90BNP PARIBAS AuM distribution per asset classes Development Plan Asset Management 100% 100% 10.7% 11.4% Other 12.0% 7.7% Balanced 13.2% Monetary 35.8% 25.1% Equity 17.8% 42.6% Fixed income 23.7% Source: BNL, BCG BNL Gestioni Market Boost the most profitable assets: equity, fixed income and alternative ■ Rationalised fund range (divided by 2) Segmented discretionary mandate offering ■Enhanced network interactions & marketing and sales support (retail and private banking) driven by AMS Merged BNL Gestioni and BNP Paribas AM operations in Milan BNL Grupp BNP PARIBAS Asset Management and Services 90 90#91BNP PARIBAS BNL Property Development BNL Real Estate Asset Fondi Management Immob. Property & Facility BNP PARIBAS Development Plan Real Estate Services BNP Paribas Dvlp. Mgt. (2006) BNP Paribas Property Mgt. (2006) Vertical integration of BNL Fondi Immobiliari 2nd in Italy with BNP Paribas Real Estate Services' Italian entities Insourcing of Property development, facility management, transactions to leverage BNP Paribas recent acquisitions in Italy ● Valorisation of BNL non strategic real estate Transaction/ Advisory Atis Real (2005) Grupp BNP PARIBAS Asset Management and Services * Source: Assogestioni 91#92BNP PARIBAS Development Plan Securities Services ● Insourced BNL institutional custody & depositary bank Insourced BNL Gestioni SGR fund administration and transfer agent Strong Securities Services offering and service provider for BNL institutional clients Optimised BNL retail custody by using BNP Paribas Securities Services global custody network Grupp BNP PARIBAS Asset Management and Services BNL 92 2#93BNP PARIBAS BNL Grupp BNP PARIBAS Life Insurance penetration ( per capita) Development Plan Life Insurance Share of premium Distribution of 2005 life-insurance products Swiss 3,275 23% UK 3,190 35% 43% 40% Ireland 2,617 Denmark 2,311 6% 8% 19% 45% 96% Belgium | 2,291 France 2,150 51% 52% Holland 1,937 46% 32% Sweden 1,764 4% Italy Norway 1,417 BNL Vita 1,174 Market wo Unicredit Index linked Whole Market Unit linked Cardif Italy Unicredit/ Aviva General account Sources: SIGMA, BNL Vita, Cardif, IAMA, 2004 Revamped BNL Vita offering with optimised life insurance product range unit-linked oriented Enhanced network interactions / sales support Asset Management and Services 93#94BNP PARIBAS Creditor insurance GWP Development Plan Creditor Insurance Lower penetration of creditor insurance Higher risk client perception (1 low - 10 high) 7.3 Critical illness 8.4 9,000 8,000 7,000 6,000 5,000 4,000 3,000 Spain Netherlands 2,000 Italy 7.0 ⚫UK Germany Death 18.3 6.6 Unemployment 7.5 6.6 France Accidents 7.4 6.4 1,000 Portugal Belgium 0 0 20 40 60 80 100 Accident family member 4.9 Unexpected spending 5.1 4.6 Divorce 5.1 Italy Europe Sources: TNS Sofres - 2005 8.0 BNL Grupp BNP PARIBAS Population (mn) Sources: Finaccord / Sigma, BNP Paribas Assurance, 2004 Capitalise on Cardif unique expertise on credit protection insurance • Increasing market potential Enlarged Cardif creditor insurance offering for BNL clients ■Leverage BNL potential in "creditor insurance" on mortgages, personal loans and credit cards Development of individual protection offering Asset Management and Services 94#95BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview AMS Overview Strategy in Italy Development Plan Conclusion#96BNP PARIBAS Strong Business Complementarities within AMS Cardif BNL Vita Life-insurance offering BNL SGR Asset Management Custody & Fund administration Fund administration Global custody Depository Bank Multi-management Fund offering Discretionary management Private Banking Life-insurance offering BNP Paribas Real estate investments Securities Services Depository Bank Real Estate Services Real estate funds BNL Grupp BNP PARIBAS BNL clients Third parties Revenue synergies: enhanced capability to answer more sophisticated client needs Asset Management and Services 96 96#97BNP PARIBAS BNL Committed to Delivering the Synergies Total 2009 AMS Synergies -18 13 41 36 36 in €mn Gross Revenue Marginal Costs Cost Synergies Total Synergies Synergies 75 projects aimed at delivering €36mn synergies Grupp BNP PARIBAS Asset Management and Services 97#98BNP PARIBAS Conclusion Extended range of investment's products and services in Italy and abroad, for Italian clients Diversified client base with high potential A second domestic market to boost AMS growth and profitability BNL Grupp BNP PARIBAS Asset Management and Services 98#99BNP PARIBAS BNL Gruppo BNP PARIBAS BNP Paribas International Retail Banking and Financial Services (IRFS) in Italy Pierre Mariani Head of IRFS Denis Delespaul Head of Leasing Italy Rome, December 1st 2006#100BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Strong Brands and Leadership Positions BNL: a Unique Opportunity for IRFS Creating a Leader in Italian Leasing Conclusion#101BNP PARIBAS BNL IRFS at a Glance INTERNATIONAL RETAIL BANKING AND FINANCIAL SERVICES 52,000 employees in 56 countries Retail Banking in the United States Retail Banking in Emerging Consumer Finance Private Mortgage Equipment Solutions Markets BANCWEST A BNP PARIBAS company BMCI Groupe BNP PARIBAS #7 commercial bank in the Western US 742 branches TEB УКРСИББАНК BNP PARIBAS Group 1,650 branches in 32 territories Cetelem A BHP PARIBAS company UCB BNP PARIBAS LEASE GROUP #1 in Continental Europe #3 in France among specialist players #3 in Europe Grupp BNP PARIBAS International Retail Banking and Financial Services ARVAL Une société de BNP PARIBAS #2 in Europe 101#102BNP PARIBAS Sustained Growth and Increased Profitability IRFS Revenues & Operating Income 5,980 1999-2005 CAGR Revenues 5,417 4,870 4,903 5,013 Operating Income +11% 4,174 3,597 3,074 2,036 1,801 1,503 1,629 1,826 1,219 +16% 1,015 818 in Єmn 1999 2000 2001 2002 2003 2004 2005 9M06 Pre-Tax ROE 25% Pre-Tax Income 18% A growing contribution to Group results BNL Grupp BNP PARIBAS International Retail Banking and Financial Services 37% Percentage of 23% Group Pre-tax Income 102#103BNP PARIBAS Italy a Significant Market for IRFS Geographic split of IRFS 2005 Pre-Tax Profit International activities (excluding France) 63% 70% 67% 71% Other international locations 37% 30% 33% 29% Italy Consumer Credit* Private Mortgage Leasing Fleet Management Italy: the largest international presence for Specialised Financial Services prior to the acquisition of BNL BNL Grupp BNP PARIBAS * Findomestic 50/50 JV with Cassa di Risparmio di Firenze International Retail Banking and Financial Services 103#104BNP PARIBAS BNL Grupp BNP PARIBAS Italy Strong Brands and Leadership Positions Start-up Employees Ranking Market Share Before BNL Acquisition Findomestic Consumer Finance* Banca 1984 >2,000 #1 UCB BANCA 1989 250 #3 Una società di BNP PARIBAS Mortgages BNP PARIBAS 1990 170 LEASE GROUP Leasing ARVAL 12% 10% Among specialist players #1 14% On small-ticket segment** A BNP PARIBAS com 1995 560 #1 20% Fleet Management Over 20 years of success in Italy * 50/50 JV with Cassa di Risparmio di Firenze ** Leasing of equipment goods < €50,000 International Retail Banking and Financial Services 104#105BNP PARIBAS 2005 Outstanding Loans €mn Italy A Growth Driver for IRFS 2002-05 New Loans Growth 2005 Pre-Tax ROE CAGR, % % Findomestic * 8,362 11.1 Banca UCB BANCA 2,242 Una società di BNP PARIBAS BNP PARIBAS LEASE GROUP ARVAL A BNP PARIBAS company BNL * Grupp BNP PARIBAS 32.9 31 42 1,114 16.0 41 91,760 vehicles 14.6 ** 67 Findomestic 50/50 JV with Cassa di Risparmio di Firenze ** Number of vehicles International Retail Banking and Financial Services 105#106BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Strong Brands and Leadership Positions BNL: a Unique Opportunity for IRFS Creating a Leader in Italian Leasing Conclusion#107BNP PARIBAS Combine IRFS' Product Factories and BNL's Distribution Channel Product factories BNL subsidiary + Distribution channels Existing channels (direct distribution/ partnerships/ etc.) BNP Paribas subsidiary BNL Gruppo BNP PARIBAS ⚫ IRFS subsidiaries' clients • BNL Corporate clients BNL Retail clients BNL Grupp BNP PARIBAS A unique opportunity outside France to combine specialised financial services subsidiaries and a banking network International Retail Banking and Financial Services 107#108BNP PARIBAS BNL Grupp BNP PARIBAS Significant Benefits Leverage BNL's client base Distribute BNP Paribas' products through BNL's Corporate and Retail distribution channels Revenue Synergies Contribute to the development of BNL's client base Incentivise the cross-selling of BNL products to the clients of IRFS' Italian subsidiaries Offer higher-quality services to BNL clients Develop large-scale industrial projects • Combine operating platforms in specialised financial services Develop stronger integration of IRFS' product factories and BNL Revenue Synergies Cost and Revenue Synergies Building on experience of partnerships between product factories and banking networks International Retail Banking and Financial Services 108#109BNP PARIBAS Leverage BNL's Client Base Examples Arval: cross-selling to BNL customers ■ A unique opportunity for Arval to extend its market leadership by growing in the attractive SME and mid-corp clients segments BNL to refer Corporate and Small Business clients to Arval ■ Arval to set up a salesforce dedicated to BNL (relationship managers and call-centre) UCB International Buyers: mortgage loan offering for BNL customers buying a house abroad ■ Dedicated process for BNL Affluent and Private Banking clients buying a house abroad with a mortgage loan issued by UCB Several high-potential projects being launched BNL Grupp BNP PARIBAS International Retail Banking and Financial Services 109#110BNP PARIBAS Contribute to the Development of BNL's Client Base Examples Banca UCB: contribute to BNL's client acquisition effort ■ Discount on mortgage loan rate for Banca UCB new customers opening a current account at BNL Retail banking in Emerging Markets: strong growth in coverage to boost ability to serve BNL clients abroad ■ Doubling of existing branches in the Mediterranean and Gulf areas over the 2005-07 period to reach 650 branches by 2007 ■ Italian relationship managers transferred to Emerging Markets locations to serve and develop Italian clients Initial focus on Tunisia and Turkey Leverage on our experience and international network BNL Grupp BNP PARIBAS International Retail Banking and Financial Services 110#111BNP PARIBAS Develop Large-scale Industrial Projects In progress ■ Leasing: merger of BNP Paribas Lease Group and Locafit to create a leader in the Italian leasing market Under assessment ■Mortgage loans: migration of Banca UCB and BNL to common IT platform ■ Consumer finance: co-operation opportunities between Findomestic* and BNL in revolving cards, personal loans and salary loans Industrial projects offering significant potential for revenue and efficiency gains BNL Grupp BNP PARIBAS * 50/50 JV with Cassa di Risparmio di Firenze International Retail Banking and Financial Services 111#112BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Strong Brands and Leadership Positions BNL: a Unique Opportunity for IRFS Creating a Leader in Italian Leasing Conclusion#113BNP PARIBAS BNL Grupp BNP PARIBAS * BNP PARIBAS LEASE GROUP BNP Paribas' Leasing Activities in Italy Scope of the Leasing integration project 100% owned by BNP Paribas • Leader on small-ticket equipment leasing market LOCAFIT Gruppo BNP PARIBAS LOCATRICE ITALIANA Gruppo BNP PARIBAS • 100% owned by BNL ⚫ #6 player in Italian leasing market 100% owned by Locafit • Niche player focused on operating leasing of equipment and medical goods for public administration clients Co CENTRO LEASING BANCA 43.5% owned by BNP Paribas * ⚫ #9 player in Italian leasing market Create a leader in Italian leasing Jointly controlled with Cassa di Risparmio di Firenze (43.5%) International Retail Banking and Financial Services 113#114BNP PARIBAS BNL BPLG + Locafit Already a Leader in the Italian Market New Loans Clients Ranking BNP PARIBAS LEASE GROUP + LOCAFIT Gruppo BNP PARIBAS €2.8bn (2006E) 80,000 #1 for small ticket leasing #3 for equipment leasing #6 for real-estate leasing Nation-wide presence 17 branches + agents Employees 460 Grupp BNP PARIBAS International Retail Banking and Financial Services Pro-forma 114#115BNP PARIBAS BNL Grupp BNP PARIBAS Strong Complementarity and Unique Positioning Client segments BNP PARIBAS LEASE GROUP LOCAFIT Gruppo BNP PARIBAS BNP PARIBAS LEASE GROUP + LOCAFIT Gruppo BNP PARIBAS Focus on small-ticket equipment leasing Focus on real-estate and medium/big ticket leasing A comprehensive and > complementary offering Distribution channels Leader in Vendor and Manufacturer channels Strong banking (BNL) and third-party channels (brokers) 4 highly complementary distribution channels Industrial process and Know-how to manage platform allowing Operations efficient management of the small ticket business real estate / structured business Skills and expertise to successfully develop both real estate and equipment leasing International Retail Banking and Financial Services 115#116BNP PARIBAS BNL Grupp BNP PARIBAS A Full Integration Process Underway BPLG - Locafit Integration Project Management Team Locafit Sales BPLG Risk Sales Management Operations Finance Organization & IT Human Resources Audit 7 Work 4 4 8 7 Groups Work Groups Work Groups Work Groups Work Groups 3 Work 3 Work 4 Groups Groups Work Groups HR IT Reporting 40 work groups in 8 areas 7 support platforms A structured and disciplined approach International Retail Banking and Financial Services 116#117BNP PARIBAS Revenue synergies Significant Synergy Potential ■ Develop cross-selling to BNL clients by offering better service to BNL clients and to the BNL network Develop operational leasing of office equipment goods Develop Vendor leasing by signing partnerships with BNL Corporate clients ■ Increase penetration of insurance products ● Cost synergies Gain efficiency by migrating Locafit activities on BNP Paribas Lease Group's European IT platform ■Reduce costs by moving to common location ■Reduce cost of central functions Risk Reduce cost of risk by implementing BNP Paribas expertise (scoring, workout...) in Locafit Numerous synergy opportunities identified and being implemented BNL Grupp BNP PARIBAS International Retail Banking and Financial Services 117#118BNP PARIBAS Revenue Synergy Example: The New Organisation of Banking Channel Commercial Organisation Key benefits BPLG-Locafit distribution channels Vendors Manufacturers Brokers Banks Creation of a dedicated division Specialisation of the Locafit sales-force and organisation in two distinct, dedicated teams ■ BNL Corporate clients BNL Small Business clients Specialisation ⚫ Higher availability Higher professionalism BNL Corporate clients SME clients > Rationalisation Higher efficiency • Higher profitability BNL Grupp BNP PARIBAS International Retail Banking and Financial Services Communication Higher motivation Better marketing support 118#119BNP PARIBAS BNL Grupp BNP PARIBAS Developing a Common Culture of Success OUR VISION "Our ambition is to become a model for our shareholder for our customers for our employees" OUR OBJECTIVES Ambition and balance 1 A leader 1 Top 3 in the market in terms ■ Market share - ROE of volumes and profitability 2 A reference 2 Cost income < 40% ■ Quality of services - Ethics 3 A social model 3 Employee turn-over < 3% ■ Values - Company climate International Retail Banking and Financial Services 119#120BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Strong Brands and Leadership Positions BNL: a Unique Opportunity for IRFS Creating a Leader in Italian Leasing Conclusion#121BNP PARIBAS Committed to Delivering the Synergies Total 2009 IRFS Synergies in €mn 31 -11 6 Gross Revenue Marginal Costs Synergies 26 26 Cost Synergies Total Synergies 50 projects aimed at delivering €26mn synergies BNL Grupp BNP PARIBAS International Retail Banking and Financial Services 121#122BNP PARIBAS Conclusion A strong presence in all business lines in Italy Now combined with a nation-wide banking network Accelerated growth and enhanced profitability BNL Grupp BNP PARIBAS International Retail Banking and Financial Services 122#123BNP PARIBAS BNL Gruppo BNP PARIBAS BNP Paribas Leveraging the Corporate Franchise Riccardo Lupi Head of BNL Corporate Division Rome, December 1st 2006#124BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Market Characteristics and Positioning New Organisation and Segmentation Enhanced Products and Services Conclusion#125BNP PARIBAS BNL Grupp BNP PARIBAS Main Features of the Corporate Market (1/2) Geographical specificities Concentration Performance Specialisation Mainly exporting to the EU Growing importance of exports to BRIC* countries Mostly small family owned mid caps Multi-banked 6 to 8 banks/Co. Large use of plain vanilla products A sizable and still traditional market *Brazil, Russia, India and China Leveraging the Corporate Franchise 125#126BNP PARIBAS Main Features of the Corporate Market (2/2) Revenues from plain vanilla products are predominant ■■■ 81% of total revenues vs. an EU average of 55% Margins and risk ■Margins: 180bp average in Italy ■ Cost of risk: 66bp average (1) in Italy ■Good risk return ratio Corporate Market Total 4.3mn €1,390bn Over 500mn 5% ≤1% 1.5mn 500mn 22% 46% Below 1.5mn 95% 32% Number of GDP(3) companies (2) BNL Grupp BNP PARIBAS (1) 2005 estimate over total loans of DEXIA, BNP Paribas, Credit Agricole S.A., Societe Generale, Banca Intesa, Sanpaolo-IMI, Unicredito Italiano (2) Source: ISTAT - only active companies considered ; (3) Estimated from Added Value Leveraging the Corporate Franchise 126#127BNP PARIBAS BNL Grupp BNP PARIBAS Main Features of the Public Administration Market Public Administration Market Mostly mono-bank clients, bank selection via tender agreements • High recourse to the banking system, mostly for treasury services and asset & liability management On-going devolution to local authorities for higher decisional and financial autonomy (namely on debt structure and cash management) Total 10,000* Central PA Large local PA Small local PA 70 Virtually no provisions €610bn 2% 66% 95% 27% 7% Number of PA Expenditure *Not including Religious agencies, Provident institution, Welfare, No-profit companies, Schools and Unions Leveraging the Corporate Franchise source: BNL Research 2004 data 127#128BNP PARIBAS 4.7% 33% Corporate Market A Nationwide Coverage Public Admin. Market 100% 5.5% Italy 2.6% (15%) North West North West 4.6% (22% 7.0% North East 5.4% (13%) Center 10.1% (20%) South (12%) Distribution of total market companies turnover Lazio and Sardegna BNL Corporate short term loans mkt share 9.6% 100% Italy 1.5% (16%) 7.6% North East (18%) 2.1% (8% South Center 17.2% (43%) Lazio and Sardegna BNL Grupp BNP PARIBAS A balanced presence throughout Italy Leveraging the Corporate Franchise Distribution of total PA market direct deposit Total BNL PA deposits mkt share 128#129BNP PARIBAS Implement a Global Strategy Adapted to Regional Requirements Global strategy Increase market share Grow share of collections Leverage integrated platform of products and services ■ Relation bank for PA ■ Benchmark bank for Corporates North East & North West ■ Cash-management Focus over prospects ■ Leverage on retail expansion ■ Internationalisation ■ Offer for Districts ■Religious organisations Center ■Diversify client base ■ Offer for Districts ■Public and Private Partnerships and prospects for Public Administration Lazio - Sardegna ■Diversify client base (Service Public Companies) ■Consolidate position in PA market South ■Consolidate market leaser positions in PA with selected projects Liability management for PA ■ Treasury BNL Grupp BNP PARIBAS Leveraging the Corporate Franchise 129#130BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Market Characteristics and Positioning New Organisation and Segmentation Enhanced Products and Services Conclusion#131BNP PARIBAS Reorganise the Network to Empower the Regions Current BNL Model 12 Aree Territoriali Target Model 5 Regions PA market PA centre 18 Corporate market Area Corporate 12 62 Corporate centre Corporate centre Corporate network 5 Region 21 Territory Territory Territory 51 Corporate Corporate Corporate & PA centre & PA centre & PA centre Corporate & PA centre Enable regional growth strategies BNL Grupp HP PARIBAS * including coverage and product specialist Leveraging the Corporate Franchise Delegate higher credit power to the network for a prompt answer to clients Increase commercial sales force by 123 FTE over 608 resources* 131#132BNP PARIBAS New Segmentation Aimed to Increase Service Level to Corporate Clients Current BNL Model Target Model Large Corporate Clienti Senior Clienti Junior CIB Coverage Client needs Large Corporate BNL response 1,900 Grandi Relazioni 850 High quality of service and products Cross selling oriented structure Selected high skills RMs 35,000 Clienti Senior Higher complexity clients Fast response Occasional high skills and tailored products Clienti Junior BNL Grupp BNP PARIBAS Corporate clients with turnover from 1.5mn to 500mn Leveraging the Corporate Franchise High local presence and high local delegation of power New network of external specialists for specific complex needs 132#133BNP PARIBAS New Segmentation Aimed to Increase Service Level to Public Administration Clients* Current BNL Model Target Model CIB Coverage 40 40 Grandi Relazioni Clienti Enti Clienti Local 330 16,000 Client needs BNL response High quality of service and products Cross selling oriented structure Selected high skills RMs Rather similar to medium and small corporate needs PA Relationship Managers included in a common structure with Corporate Functional link maintained with PA management BNL Grupp BNP PARIBAS * Religious agencies, Local agencies, Central agencies, Provident institution, Welfare, Foreign offices, Non profit companies, Law courts, Military entities, Schools and Unions Leveraging the Corporate Franchise 133#134BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Market Characteristics and Positioning New Organisation and Segmentation Enhanced Products and Services Conclusion#135BNP PARIBAS Enhanced Products and Services Benefit from a worldwide network with a strong presence in the Mediterranean Expand cash management offer to best in class standards • Increase specialised financial services product range • Leverage on new specialist support Become the benchmark bank for Italian corporates Confirm leadership position for Italian public administration BNL Grupp BNP PARIBAS Leveraging the Corporate Franchise 135#136BNP PARIBAS International presence* (number of countries) Benefit from a Worldwide Network (1/2) 99 66 53 42 34 85 Intesa-SP Unicredit ABN Credit Ag. BNP Paribas The largest international network offered to Italian customers BNL Grupp HP PARIBAS *Including Representative Offices; Source: Company Reports, Analyst Presentations, Industrial Plans, Web Sites Leveraging the Corporate Franchise 136#137BNP PARIBAS BNL Grupp BNP PARIBAS Benefit from a Worldwide Network (2/2) Mediterranean Basin and Gulf Region ■448 branches as at 30.06.06, and 200 more to be opened by end of 2007 Far Eastern Europe ■Over 1,000 branches in Ukraine (UkrSibbank) by 2007 ■150 branches to be opened in Russia within 4 years Italian Desks being opened in France, Turkey, Tunisia, Gulf Region French Desks being opened in Italy (Italian export towards France: 12%) * 2005. Source: elaboration from Osservatorio ecoonmico ministero commercio internazionale on ISTAT data. Leveraging the Corporate Franchise 137#138BNP PARIBAS BNL Grupp BNP PARIBAS Raise Cash Management Offer to Best in Class Standards BNP Paribas leading European transactional service for large corporates* Treasury Strategies with a penetration rate 14.2% 56% of the international cash management request for proposals received by BNP Paribas in 2006 included Italy • BNL cash management capabilities to be integrated within and benefit from the global offer Access to high technology products & services for large corporates ■ New Transalpina offer targeting Mid. Caps. to be launched early 2007 • Cash management mandates already won including Italian service offer ■Roullier, Seb, CMA-CGM Strongly improve BNL Cash Management offer * Turnover > €1bn Leveraging the Corporate Franchise 138#139BNP PARIBAS BNL Grupp BNP PARIBAS Add New Fleet Management Products to Strong Factoring and Leasing Offer Factoring Ifitalia #2 16% market share Integrate into Corporate Division ● Synergies with BNPP-Factor Launch "Easy factoring" products Leasing Car Fleet Management BPLG Locafit #3 - in Equipment Leasing - 10% market share Arval #1 20% market share Deploy comprehensive product range • Leverage on highly complementary distribution channels Develop both real estate and equipment leasing Refer Corporate and Small Business clients to Arval Set up a sales force dedicated to BNL Establish permanent interactions Wider and more competitive offer now available for BNL clients Leveraging the Corporate Franchise 139#140BNP PARIBAS Corporate Division Deploy Specialist Support at Regional Region Specialists Cash Management Fixed Income Structured Finance and Local Level New dedicated support Strengthen of current support Territory Specialists Trade Centers Regulated loans Corporate and PA center Specialists Support within BNL bc - Corp. Division Support Provided by SFS Support located within CIB - BNL Arval New dedicated support New dedicated support BPLG-Locafit Ifitalia Strengthen of current support CIB Mid Cap dedicated teams BNL Grupp BNP PARIBAS Expertise and Cross selling at the heart of the organisation Leveraging the Corporate Franchise New dedicated team 140#141BNP PARIBAS BNL Gruppo BNP PARIBAS Presentation Overview Market Characteristics and Positioning New organization and segmentation Enhanced Products and Services Conclusion#142BNP PARIBAS BNL Evolution of BNL bc Corporate Division has Already Started New structure being implemented ■ Pilot project has started in the North East Key Regional Managers and Relationship Managers already identified ● Special commercial initiatives launched ■Cross border clients targeted for cash-management ■ Systematic target of companies with internationalization needs ● Italian desks being opened Italian Desks in France, Turkey, Tunisia and Gulf Region ■Further openings planned in Russia, India, China, Poland ... Grupp BNP PARIBAS Leveraging the Corporate Franchise 142#143BNP PARIBAS BNL Grupp BNP PARIBAS Revenues per Corporate Client in €000 17.2 +19% 20.7 2006 2009 Ambitious 2009 Targets Revenues per Public Administration Client in €000 +11% 8.8 8.0 2006 2009 Significantly raise revenues per client Leveraging the Corporate Franchise 143#144BNP PARIBAS BNL Grupp BNP PARIBAS Committed to Delivering the Synergies Total 2009 BNL bc Corporate Division Synergies -17 77 in €mn Gross Revenue Marginal Costs Synergies 59 59 119 Cost Synergies Total Synergies 50 projects aimed at delivering €119mn synergies Leveraging the Corporate Franchise 144#145BNP PARIBAS BNL Grupp BNP PARIBAS Fine tuned strategy Unmatched offering Leveraging the Corporate Franchise Act fast! Conclusion 145#146BNP PARIBAS BNP PARIBAS-BNL Corporate and Investment Banking BNP Paribas Corporate & Investment Banking in Italy Nicola D'Anselmo Head of CIB Italy Rome, December 1st 2006#147BNP PARIBAS BNP PARIBAS-BNL Corporate and Investment Banking Presentation Overview BNP Paribas CIB in Italy before BNL New Perspectives for CIB Implementing the Strategy Conclusion#148BNP PARIBAS Equity Derivatives ■ Management of market risks ■ Optimised investments. (capital/ yield protected) ■Solutions for strategic equity stakes Fixed Income ■ Debt Capital Markets ■Interest rates, foreign exchange and credit markets ■Cash & derivatives products Full Product Range Offered in Italy Coverage Corporates Coverage Financial Institutions Corporate Finance Mergers & Acquisitions Equity Capital Markets Energy Commodities Export Project Commodities finance ■Export finance ■Project finance ■ Asset finance (Aviation/ Shipping) Trade services Structured Finance ■Loan syndication ■Acquisition finance Leveraged finance Real Estate financing Media & Telecom financing BNP PARIBAS-BNL Corporate & Investment Banking in Italy 148#149BNP PARIBAS BNP PARIBAS-BNL Corporates 80 core Italian corporates 55 subsidiaries of non Italian clients Local Authorities & Public Services 40 public bodies Corporate & Investment Banking in Italy Major Clients Financial Institutions ■30 banking groups 10 insurance groups CIB Products & Services Financial sponsors ■All major international and Italian financial sponsors 149#150BNP PARIBAS BNP PARIBAS-BNL Top Tier Player in Corporate and Investment Banking Large and well-established franchises in Corporate and Investment banking in Italy ■ Over 100 front-line professionals delivering the full range of BNP Paribas' services ■ Capitalising on global franchises in Fixed Income, Equity Derivatives and Specialised Financing Leading positions in the Italian market ■ #1 bookrunner in 2005 financial sponsors driven deals (Leverage Finance) (1) ■ Market leader in Italian securitisation since 1992: #1 bookrunner in 10M06 for all asset classes (2) ■Top 3 player in Corporate Acquisition Finance ■Top 5 player in Project Finance (1) Source: Loanware (2) Source: Bondware Corporate & Investment Banking in Italy 150#151BNP PARIBAS BNP PARIBAS-BNL Corporate and Investment Banking Presentation Overview BNP Paribas CIB in Italy before BNL New Perspectives for CIB Implementing the Strategy Conclusion#152BNP PARIBAS Mission Statement Successfully implement the global CIB business model in all business lines ● Sell CIB products and services to a broader base of CIB and BNL bc clients Become leader in Corporate & Investment Banking in Italy BNP PARIBAS-BNL Corporate & Investment Banking in Italy 152#153BNP PARIBAS Broadening the Customer Base CIB products & services Expanded CIB customer base CIB coverage ■ All large corporates (sales > 500mn) plus an extended list of corporates in specialised sectors (Energy & Commodities, Media & Telecom, Shipping, Aviation, Real Estate) ■All Financial sponsors 110 Financial Institutions 40 Local Authorities New BNL bc customer segments Corporate Division ■ Corporates with sales < 500mn ■More than 500 Local Authorities Retail & Private Division 703 branches and 18 Private Banking Centres 2.6mn customers BNP PARIBAS-BNL Corporate & Investment Banking in Italy 153#154BNP PARIBAS Significant Cross Selling Opportunities with BNL bc BNP PARIBAS-BNL Common platform for structuring and marketing Fixed Income products to Corporate Division clients ● Dedicated Fixed Income desk for Local Authorities • Set-up of a specialised M&A team to serve small and mid-corporate clients Partnership with the Retail and Private network for the marketing of Equity Derivative products An international Investment Banking platform with a Corporate and Retail coverage: a unique business model in Italy Corporate & Investment Banking in Italy 154#155BNP PARIBAS Leveraging on French Experience Revenues in FRB from cross selling between CIB and FRB (100 reference in 2002) (1) 9 Months 100 263 538 425 512 439 2002 2003 2004 2005 9M06 A well proven cross-selling track record BNP PARIBAS-BNL (1) FRB: French Retail Banking Corporate & Investment Banking in Italy 155#156BNP PARIBAS BNP PARIBAS-BNL Corporate and Investment Banking Presentation Overview BNP Paribas CIB in Italy before BNL New Perspectives for CIB Implementing the Strategy Conclusion#157BNP PARIBAS BNP PARIBAS-BNL Integration Process Functions Taskforce 32 CIB Workgroups Coverage Corporates (1) Coverage FIG (1) Fixed Income (6) Structured Finance (5) Corporate Finance (2) Corporate Taskforce Back offices Taskforce ● EQD (4) • ECEP (7) < IT Taskforce Correspondent Banking (1) International CIB (5) Corporate & Investment Banking in Italy 157#158BNP PARIBAS BNP PARIBAS-BNL Corporate Coverage Corporate Coverage ● Reinforced coverage teams to serve a broader client base ■Increased specialisation to improve client focus Offer first-class solutions to corporate clients by ■ Coordinating Business Lines ■Cross selling with Corporate Division Leveraging on BNP Paribas platform for cross-border transactions Industry coverage Territorial coverage Chemical & Pharma • Media & Conglomerate Energy & State Steel & Construction Food & Retail • Auto & Luxury • Center area North-west area •North-east area Local Authorities & Public Services Subsidiaries of non-Italian clients • N. Europe, UK & S. Africa France, Russia ⚫ Germany, Austria, Switz. ●Benelux, Spain, Portugal North America •Far-East & USA, Other 80 Clients 120 Clients 40 Clients 210 Clients Marketing & support Credit team A more powerful platform to deliver value-added solutions to clients Corporate & Investment Banking in Italy 158#159BNP PARIBAS BNP PARIBAS-BNL Financial Institutions Coverage Consolidate our leading position with large financial institutions Develop sales with regional banking groups by leveraging on BNL existing relationships • Enter the Italian Institutional Investors Market (banking foundations, pension funds) with tailor-made solutions Expand number of clients and strengthen business relationships through cross-selling Corporate & Investment Banking in Italy 159#160BNP PARIBAS BNP PARIBAS-BNL Financial Institutions Large Corporates Local Authorities & Public Services Mid- Corporates Fixed Income A dedicated sales team to add BNP Paribas Fixed Income expertise to BNL strong existing relationships with mid and small regional banks Deploy BNP Paribas world-class expertise leveraging on BNL's commercial relationships Combine BNL approach of very close client contacts through the network with a group of product specialists bringing BNPP expertise in derivatives and securitisation Specific focus on the largest organisations Dedicated sales team (joint venture with Corporate Division) • BNL providing origination, sales and direct client interaction through regional corporate sales teams BNP Paribas providing expertise in product structuring, pricing, trading and risk management techniques Corporate & Investment Banking in Italy 160#161BNP PARIBAS Equity Derivatives Leverage on BNL Italian franchise and BNP Paribas global leadership in Equity Derivatives products Develop sale of structured products through BNL retail network Develop Structured Products for retail clients Bring innovation to BNL clients ●Insurance wrappers (index-linked, unit-linked), structured notes, investment certificates Launch a covered warrants & certificate Develop Retail Listed Products offer through new issues •Distribution through BNL retail network and online platform, external brokers and institutional coverage activity Further penetrate the Italian institutional investor market Propose global investment solutions to Italian institutional investors •Focus on entering new segments: pension funds (Casse Previdenziali), non-profit organisations and cooperatives BNP PARIBAS-BNL Corporate & Investment Banking in Italy 161#162BNP PARIBAS BNP PARIBAS-BNL Structured Finance • The integration of two leaders complementing each other BNP PARIBAS A truly Pan-European franchise with integrated advisory and debt platforms, leader in large sized transactions on the Italian market BNL Gruppo BNP PARIBAS A leading player in the Italian market for mid-sized structured deals with strong origination capabilities BNP PARIBAS-BNL Corporate and Investment Banking A leading force in the Italian leveraged loan market: 19 deals in 2006 YTD with underwritten debt in excess of 2.1bn Stronger combined position in Corporate Acquisition market A powerful syndication desk in Italy Corporate & Investment Banking in Italy 162#163BNP PARIBAS Energy Commodities Export Project Energy and commodity derivatives present high potential with BNL's strong Mid. Cap. Italian client base Shipping: combine BNL's domestic client proximity with BNP Paribas' specialised industry coverage approach • Example: BNP Paribas-BNL has just led a $450mn facility for Navigazioni Montanari, the largest shipping transaction ever arranged in the Italian market by an international shipping bank Build on ECEP's leading market expertise to offer high value added products to BNL corporate customer base BNP PARIBAS-BNL Corporate & Investment Banking in Italy 163#164BNP PARIBAS BNP PARIBAS-BNL Corporate Finance A very attractive growth potential for Corporate Finance (CF) ■ Penetrate the large transaction segment of the market, i.e. deal size over 1bn ■New focus on small-mid caps for M&A and ECM transactions ■ Increase ECM market share to that of the other major Italian banks Key actions identified to extract growth potential ■ Expansion of CF Italy current platform to ensure full coverage of CIB broader large cap customer base ■ Set-up of a team within CF Italy fully dedicated to small and mid caps covered by the Corporate Division of BNL, to transform pure lending relationships into CF relationships BNP Paribas - BNL to become a local operator in the Italian Corporate Finance business Corporate & Investment Banking in Italy 164#165BNP PARIBAS BNP PARIBAS-BNL Corporate and Investment Banking Presentation Overview BNP Paribas CIB in Italy before BNL New Perspectives for CIB Implementing the Strategy Conclusion#166BNP PARIBAS BNP PARIBAS-BNL Committed to Delivering the Synergies Total 2009 CIB Synergies -23 33 96 110 in €mn -24 Negative Revenue Synergies Gross Revenue Marginal Costs Cost Synergies Total Synergies Synergies 90 projects aimed at delivering €96mn synergies Corporate & Investment Banking in Italy 166#167BNP PARIBAS Conclusion A European leader with a strong local presence : a unique combination in Italy Wide range of cross selling opportunities with other divisions in Italy Become leader in Corporate & Investment Banking in Italy BNP PARIBAS-BNL Corporate & Investment Banking in Italy 167#168BNP PARIBAS BNL Gruppo BNP PARIBAS BNP Paribas Investor Day Conclusion Baudouin Prot Chief Executive Officer Rome, December 1st 2006#169BNP PARIBAS Businesses 3Q06 revenue split BNP Paribas A Well Balanced Business Mix Geography 3Q06 revenue split South Asia Pacific America 6% 1% Middle East/Africa CIB FRB 20% 4% 26% North America 12% BNL bc Emerging 11% Europe 3% AMS 16% IRFS 27% Other Europe 16% Italy 14% France 44% Strong retail banking base: 58% of revenues Europe is the core market: 77% of revenues BNL Grupp BNP PARIBAS BNP Paribas 169#170BNP PARIBAS BNL Grupp BNP PARIBAS Individual Customers BNP Paribas An Integrated Business Model Corporate Customers Financial Institutions France Retail Banking networks Italy Western United-States Emerging Markets Specialised Financial Services Asset Management and Services Corporate and Investment Banking Centred on client needs and cross selling BNP Paribas 170#171BNP PARIBAS BNL Grupp BNP PARIBAS BNP Paribas A Strong Revenue Generation Capability Revenues +14.6% +11.2% at constant scope and exchange rate +28.7% +15.4% at constant scope and exchange rate 21.5 20.9 18.7 16.2 In €bn 2004* 2005* 9m05* 9m06* Robust organic growth further enhanced by a selective acquisition policy BNP Paribas * EU-IFRS standards, excluding BNP Paribas Capital 171#172BNP PARIBAS BNL Grupp BNP PARIBAS Cost/income 64.2 in % BNP Paribas Cost & Risk Discipline 65.2 62.7 62.9 61.6 61.2 59.4 2000 2001 2002 2003 2004 2005 9M06 Cost of Risk 51 50 45 41 30 18 16 in bp 2000 2001 2002 2003 2004 2005 9M06 Strong culture of cost & risk management BNP Paribas 172#173BNP PARIBAS A Track Record of Growth and Value Creation Net Earnings per Share 5.55 Dividend per Share 7.02 4.70 4.64 4.31 3.78 2.79 2.58 2.16 1.43 0.66 0.71 0.42 in € in € 93 94 95 96 97 98 99 00 01 02 03 04 05 Undiluted EPS based on the average number of shares outstanding Net earnings per share +26.5% per annum (CAGR 93-05) BNL Grupp BNP PARIBAS BNP Paribas 2.00 1.45 1.20 1.20 1.13 0.88 0.75 0.53 0.41 0.23 0.24 0.27 93 33 94 94 95 96 96 2.60 90 97 98 99 00 01 02 03 04 05 Dividend per share +22.4% per annum (CAGR 93-05) 173#174BNP PARIBAS The Integrated Business Model Applied to Italy • Full range of businesses deployed, with significant positions Retail Consumer banking finance Mortgage Fleet Mgt Leasing Private banking Securities Insurance Asset Mgt Services Real Estate CIB BNP Paribas in 2005 Joint Venture 50%* External growth since 2005 • New organization (BNL bc / CIB / AMS / SFS/ functions) ■Share know-how & state-of-the-art products ■ Foster cross-selling Leverage local expertise with Group best practices ■ CRM, Risk management, ALM... BNL Grupp BNP PARIBAS * Findomestic 50/50 JV with Cassa di Risparmio di Firenze BNP Paribas 174#175BNP PARIBAS BNP Paribas Competitive Advantages in Italy Leading European positions in major product areas (consumer credit, leasing, CIB...) • Proven commercial know-how distribution skills, relying on cross-selling and incentivised sales forces Strong brand policy, capitalising on BNL recognised franchise and BNP Paribas European leadership • Worldwide presence, facilitating the international development of Italian clients ◆ Financial strength: ■ Tier One ratio at 7.8% by end 3Q06 ■ Outstanding ratings: S&P = AA (positive outlook), Fitch = AA, Moody's = Aa2 BNL Grupp BNP PARIBAS BNP Paribas 175#176BNP PARIBAS A Solid Base from Which to Increase our Market Shares BNL Group market shares BNP Paribas Italy market shares Individuals Corporate 12* 5 5 in % 2 Mortgage Life Insurance Consumer credit Network Client Penetration Retail Asset Mgt 20 20 20 20 16 5 5 сл 5 5 LO in % Fleet Mgt Factoring Leasing Equipment LBO Project Finance Corporate Finance BNL Grupp BNP PARIBAS Sources: Banca di Italia, Assogestioni, Assofin, ANIA, GfK Eurisko. Latest data available. Sources: Loanware, Bondware, Dealogic, Assifact, Assofin leasing Latest data available BNP Paribas has ample room to grow organically, by capitalising on its specialised businesses Findomestic 50/50 JV with Cassa di Risparmio di Firenze BNP Paribas 176#177BNP PARIBAS BNL Grupp BNP PARIBAS Ingredients of an Italian Success Story in Place Highly skilled top management, with complementary background & experiences Responsive organisation & clear action plans, giving more power to the line managers BNL staff motivated by the new challenge Full BNP Paribas support: people and investments to develop the franchise BNP Paribas Early Start, Strong Momentum 177#178BNP PARIBAS Creating Value from BNL Synergies target (2009, pre-tax) revised upwards to 480mn ■ Cost: 270mn ■ Revenues: 210mn A value-adding transaction Reasonable price paid for BNL, given the synergies and the subsequent transactions in the Italian market ■ EPS impact accretive as of 2008, even post restructuring costs. A new impulse for all our businesses ■ BNL banca commerciale ■ Asset Management and Services International Retail Banking and Financial Services ■ Corporate and Investment Banking ■French Retail Banking BNL Grupp BNP PARIBAS BNP Paribas 178#179BNP PARIBAS BNL Grupp BNP PARIBAS BNP Paribas BNP Paribas a key player in Italy Conclusion 179#180BNP PARIBAS BNP Paribas Investor Day Italy: Developing our Second Home Market Baudouin Prot Chief Executive Officer BNL Rome, December 1st 2006 Gruppo BNP PARIBAS#181BNP PARIBAS BNL Gruppo BNP PARIBAS Appendix#182BNP PARIBAS BNL 9M06 As published in Italy P&L Reclassifications Explained Group contribution incl 1Q06 proforma Revenues 2,305 3 2,233 Costs (1,599) 4 (1,400) Gross Op. Income 706 833 2 Cost of risk (485) LO 5 (245) Reclassifications Operating Income 221 588 Net Pre-Tax 225 579 Purchase Accounting in €mn 1 (99mn) transferred from costs to cost of risk corresponding to provisions for credit related litigations 2 + 41mn provisions time value for money reducing cost of risk under Italian practices; increasing revenues under BNP Paribas practices 3 - 112mn as contribution does not include the results on BNL's AFS and trading portfolios revalued on purchase accounting 4 5 ( 108mn) one-off costs in BNL published accounts corresponding to BNP Paribas balance sheet adjustments (depreciations, employee benefits) ( 378mn) one-off provisions in BNL published accounts corresponding to BNP Paribas balance sheet adjustments BNL Grupp BNP PARIBAS Strategy in Italy 182