April 14, 2022

NLB Group: We believe in this regions' potential

Pursuant to the Rules of the Ljubljana Stock Exchange relating to Article 158 of the Market Financial Instruments Act NLB d.d., Trg republike 2, 1000 Ljubljana, announces

Our home is here in South-Eastern Europe. Our families, friends, colleagues, neighbours, our favourite athletes, innkeepers, who know what kind of coffee we like … are all here. We know it, understand it, feel it, and believe in it with all our hearts. That is why we can recognise this regions' potential before and better than anybody else does and help reach it - our efforts are reflected in the NLB Group Annual report 2021 and the NLB Group Sustainability Report 2021, published today.

The NLB Supervisory Board namely met today at its 3rd meeting of the year, and examined the NLB Group Annual Report 2021, which includes auditor's report prepared by Ernst & Young. The NLB Group Annual Report 2021, along with the NLB Group Sustainability Report 2021 were adopted and subsequentially published, as of now being available to all interested stakeholders.

Facing new challenges, but stronger than ever

As shown in the preliminary unaudited financial results, NLB Group emerged from 2021 very healthy - in fact, it emerged stronger than ever. This is even more significant in a year marked once again by the grip of COVID-19 and its consequent impact on the global economy and quality of life.

Encouraged by the economic recovery, driven by revived private consumption and loan demand, the Group returned to robust growth, and achieved excellent results, exceeding the set guidance. This growth was based on the strong underlying performance of all business segments, meaningful contribution from Komercijalna Banka, Beograd, while robust risk management supporting the Group's business operations also resulted in sound asset quality. The Group generated EUR 236.4 million in profit after tax and increased market shares in all segments, with all banking members operating in our home region reporting solidly positive net earnings and contributing 39% to the after tax result.

"Such an excellent result proved that even in times of economic difficulties, knowledge, experience, and sound business decisions based on sustainable principles can generate success. The Group's foundations are strong and robust, and the Supervisory Board believes that the Group will only grow stronger," highlights Primož Karpe, Chairman of NLB Supervisory Board.

His thoughts are also reflected by NLB's CEO Blaž Brodnjak, turning his gaze to the future: "The Group will continue growing prudently and increasing its market shares, above all, however, we will focus on providing our clients with innovative solutions and ever improving user experience, 24/7/365. Currently in Slovenia, our clients can already complete almost all their banking transactions without having to physically visit a branch, and we strive to apply this digital leadership position to our other markets as soon as possible. Nowadays, NLB Group is no longer just a banking business, but one of the largest IT and data science companies in the region with an ambition to foster the evolution of a flexible and locally relevant digital ecosystem, providing our clients with meaningful solutions."

To be able to accelerate this agenda, NLB Group has been setting up a Group Competence Center in Belgrade, called NLB DigIT, to act as a development hub for common IT solutions for the group. This, however, is not the only major milestone we are looking forward to in Serbia - for the next couple of weeks in particular, our thoughts will be predominantly focused on the pending merger of our two local banks into NLB Komercijalna Banka at the end of the month and the upcoming Investor Day NLB Group will host in Belgrade on 12 May, 2022.

Taking care of the region of opportunities

It should be noted that the Group is interested in not only increasing the value of our shareholders through business growth and providing our clients with the enhanced user experience, but above all in the prosperity and the quality of life in the entire region. Consequently, the sustainability of our business operations and practices has increasingly become our high priority.

We hold the E(nvironmental) dimension of the ESG especially close to our hearts by, amongst other, upgrading our climate-related and environmental risk management, supporting ideas and solutions that aim toward energy transition, and reducing our own carbon footprint. More specifically, we are deeply aware of the banks' vital role in fighting climate change by supporting the global transition of the real economy towards net-zero, which is why we not only strive to reinforce, accelerate, and support the implementation of decarbonisation, but also want to lead by example. Besides environmental issues, we are equally passionate about addressing social and governance topics, we advocate equal opportunities, as well as independent and professional corporate governance. We want to become one of the key drivers of change and sustainability agenda in our part of the world.

"However, change doesn't simply start with banks offering green loans or by distancing themselves from financing coal-related projects. It starts with us. It starts with you - with the person in the mirror. With every conscious decision we make. With our small habits and little everyday actions, such as reducing the daily commute and driving speed on highways; switching off unnecessary lights and reducing room temperature in our offices and apartments; fully eliminating paper; if not required legally, promoting diversity and inclusion, while respecting meritocracy, as well as many other, that may seem insignificant, but matter enormously, when adding up. They are, in fact, a part of a great movement when we put them side by side with the habits and actions of our co-workers' families, friends, and neighbours. And this is what we strive for in the NLB Group: to become a beacon of sustainable business and operations and one of the most responsible and meaningful companies in the SEE," adds NLB's CEO.

General Meeting of NLB d.d. scheduled for June 20

At today's meeting, the Supervisory Board also confirmed the Management Board's proposal to convene the 38^th General Meeting of Shareholders of NLB d.d., which is planned to take place on June 20. More information will be available in the convocation.

The Supervisory Board of NLB d.d. also took note of the reports submitted by the Bank's experts and granted consent to the transactions requiring approval of the Supervisory Board of NLB d.d.

Investor Relations

NLB d.d., Ljubljana