2022 Performance and Synergy Realization

Ensuring provision adequacy in response to Covid-19 crisis Guiding Principle of Post Relief Risk Schemes Repayment Schedule Scheme Interest Staging Minimum PD Level Principal SC 1 Full Full Mostly 1 Normal SC 2 Full Partial Mostly 1 SC 3 Full Postponed Mostly 2 SC 4 Partial Postponed Mostly 2&3 SC 5 Additional skip payment ≤ 6 months Mostly 2&3 SC 6 Additional skip payment ≥ 6-12 months Mostly 2&3 SC 7 Additional skip payment ≥ 12 months Mostly 3 100% tub • To have effective management of the portfolios quality, our 7 post relief schemes have been used for both Covid-19 debt reliefs and legacy portfolio - collectively "Modified Portfolio". The framework proved to be efficient in tracking and trace their quality, so that corresponding PDs could be applied and to separate them from customers never ask for relief support. The elevated PDs are applied to both principal and accrued interest of these customers group, hence higher ECL to reflect higher risk. On top of that we have tightened policy in staging and provisioning in 2022, with focus on for those who requested for SC3-SC7. SC3-SC7: Provisioning is set aside by using lifetime PD, same approach as stage 2 provisioning. SC3-SC7: 100% Management Overlay is set aside for accrued interest not already covered by PD. ECL model calibration was completed in 1Q22 by updating PD and LGD parameters in all portfolios, including forward looking economic scenarios and applied stress test method in setting up management overlay to address economic uncertainties. Continuation of prudence and persistency in supporting customer with assets warehousing program, proactive portfolio recovery, written off and sales, and with report from independent model validator on our ECL model, we believe asset quality is in-control and the provision level as at Dec-22 considered sufficient. 45

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