Investor Presentaiton

Santander Portugal's transformation resulted in greater customer loyalty and transactions, as well as one of the best efficiency ratios in the Portguese banking system Financial System ▸ Economic activity continues operating above its potential, driven by private consumption and the post-pandemic recovery in tourism. The persistently high level of inflation is penalizing households' purchasing power, which is already affecting economic sentiment and future investment decisions ▸ The abrupt and fast monetary policy tightening is contributing to a faster-than-expected increase in interest rates which will have a mixed effect on the banking system's trajectory, with a favourable impact on NII but a potentially negative effect on provisions Strategy & Business Santander Portugal's comprehensive transformation programme allowed it to increase customer loyalty, with the improvement in net fee income, high new origination volumes, controlled costs and strict asset quality management We remain focused on our digital transformation process, with the aim of achieving top customer satisfaction, best-in-class efficiency ratio and attractive financial performance, including sound capital and liquidity OD Results Total income accelerated QoQ, supported by growth in NII, reflecting the positive effect of higher interest rates and the effect from the SRF contribution in Q2. YoY comparison continued to be affected by ALCO sales in 2021 ▸ Operating expenses continued to improve YoY, reflecting our commercial and digital transformation. Efficiency ratio improved by 1.8pp ▸ LLPs remain at very low levels, reflecting the strength of our balance sheet and a resilient labour market ‣ Underlying profit increased 75% QoQ, driven by the recovery in total income, combined with a flat cost base and low provisioning Santander 22

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