Real Estate Investment Strategies

Regulation is altering business decisions for financial institutions and expected to do so for years to come The timing, scope and true demand for de-regulation is highly uncertain RWA¹ Floors (Basel IV) EL Accounting (IFRS 9/CECL)² Basel III CRD³ IV Dodd Frank (Affects Everything) CFPB4 FRTB5 U.S. commercial finance loans U.S. CRE U.S. consumer loans U.S. residential loans Servicing platforms Structured products ++ European commercial finance loans European CRE European consumer loans UK/European residential loans PIMCO estimates that the market impact could exceed $2 trillion As of 23 January 2017 1. Risk Weighted Assets 2. Current Expected Credit Losses 3. Capital Requirements Directive 4. Consumer Financial Protection Bureau Current 5. Fundamental Review of the Trading Book Refer to Appendix for additional forecast, investment strategy and risk information. PIMCO Mortgage servicing rights (MSRs) Complex, off-the- run securities 6

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