Investor Presentaiton

IFRS 9 - Impairment loss allowance Pro-forma estimated impact on 1 Jan 2018 1 Jan 2018 impact Shareholders' Equity Reserves CET1 Fully Loaded NPES Provisions NPE Coverage ratio (€120m) (c.20bps) Unchanged +€130m +2% Pro-forma impact Fully Loaded CET1 ratio - Dec 17 13.8% (0.25%) 0.05% Dec 17 Fully Loaded CET1 Net increase in Impairment loss allowance Tax Credit 13.6% Pro-forma Fully Loaded CET1 • New IFRS 9 accounting standard effective from 1st January 2018 replacing IAS 39. Impairment provisioning model now based on expected credit losses (ECL) as opposed to incurred losses • Estimated quantitative impact on initial adoption of IFRS 9 is a reduction in shareholders' equity of c.€120m, largely due to an increase in impairment loss allowance on loans and advances to customers Increase in impairment loss allowance partially offset by the ending of the probationary provisioning framework for performing ROI mortgages. No change in quantum of NPES on transition to IFRS 9 Pro-forma impact on fully loaded CET1 ratio is expected to be c.20bps • The Group is availing of the transitional arrangements for mitigating the impact of IFRS 9 on regulatory capital Expect the impairment charge for 2018 to be up to c.20 bps, reflecting the transition to IFRS 9 and a slower pace of impairment reversals with a consequent trend towards more normalised levels Bank of Ireland Group 49

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