Investor Presentaiton

Group Chief Executive Statement "We are pleased to announce a positive set of financial results for 2022, exceeding our targets and confirming the sustainability of our business model with well-diversified revenues and disciplined cost containment despite inflationary pressures. Our profit after tax before non-recurring items of €188 mn has more than doubled on the prior year, corresponding to a return on tangible equity of 11.3%. Against the backdrop of the challenging global and European economic environment, the Cypriot economy is proving resilient and is delivering strong growth notwithstanding headwinds. In the fourth quarter, GDP increased by 4.4% in Cyprus and is forecast to grow by c.3.0% in 2023, according to the Ministry of Finance, outperforming the Eurozone average. As the largest financial group in Cyprus, we continued to support the economy by extending a record €2.1 bn of new loans in 2022, an increase of 17% on the prior year, whilst maintaining strict lending criteria. Our net performing loan book of €9.6 bn grew by 3% in 2022 and it demonstrates strong fundamentals to withstand uncertainties in the macroeconomic outlook. During 2022 we generated total income of €699 mn and a positive operating result of €318 mn, up 62% on 2021. Net interest income amounted to €370 mn, up 25% on the prior year, of which €136 mn was generated in the fourth quarter. Our non-interest income was marked by strong performance in net fee and commission income as well as exceptionally strong insurance income in 2022 and contributed 47% to total income. Operating expenses decreased by 1% as the efficiency actions undertaken during the year more than offset inflationary pressures. As a result our cost to income ratio, excluding special levies and other contributions, improved by 11 p.p. in the year to 49%. Our cost of risk of 44 bps remained well within our target range, reflecting healthy asset quality performance. The reported result was a profit of €71 mn for the year ended 31 December 2022, reflecting the large restructuring charge we took earlier in the year for our Voluntary Staff Exit Plan. In November 2022 we completed Project Helix 3 and derecognised c. €550 mn NPEs from our balance sheet. Together with further organic NPE reduction of €360 mn our NPE ratio stood at 4% as at 31 December 2022, achieving our 2022 NPE ratio target of sub-5%. Our capital position remains robust and comfortably in excess of our regulatory requirements. We ended the year with a Total Capital ratio and CET1 ratio of 20.6% and 15.4% respectively, both on a transitional basis. Our liquidity position remains strong, as such our cash balances with ECB (excluding TLTRO III of €2.0 bn) amounted to €7.6 bn, leaving the Bank well positioned to benefit from further interest rate increases. Deposits on our balance sheet remained broadly flat during the quarter but increased by 8% on the prior year, to €19.0 bn. Capitalising on this strong performance we are today upgrading our ROTE target for 2023 to over 13% from over 10%, laying the foundations to commence meaningful dividend distributions from 2023 onwards, subject to regulatory approval and market conditions. The ROTE target upgrade is facilitated by our positive gearing to rising interest rates, the significant contribution from non-interest income whilst maintaining cost discipline, a healthy loan portfolio and solid capital position." Panicos Nicolaou 3

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