Page 16 - Consolidated Non Financial Statement

Banca Ifis

| 2020 Consolidated Non-Financial Statement
In this context, Banca Ifis remains concentrated on pursuing initiatives aimed at protecting the quality of assets and
recoveries of the Npl portfolio, as well as proceeding with the investments and projects seeking to innovate the business
model in support of the Bank's growth over the coming years.

On the credit front, at present, it is difficult to estimate the impacts on the quality of the assets, which will probably only
become clear when moratoriums come to an end. The Banca Ifis Group business model, which looks to the short-term
and is characterised by a good segment diversification, should afford greater protection. In addition, factoring
substantively offers a twofold guarantee of the credit, by the transferred company and by the transferor, whilst the
residual value of the leased assets helps reduce the risk. In a similar fashion, the impacts on the Npl business are
mitigated by the diversification of the portfolio in terms of geography, segment and number of debtors. Additional
provisions have also been made on performing exposures in the industries most exposed to the effects of the pandemic
crisis, as well as action taken to reflect possible delays in the legal collection of debt.

In respect of its business model, the technological innovation aims, in the commercial business, to develop a digital
lending platform with a view to digitising all management processes and creating a specific marketplace for small and
medium enterprises, with a technological service that extends to all stages of the application, assessment and
disbursement of the loan. The early months of 2021 saw the launch of a new service that allows customers to request
and obtain a loan backed by the MCC Guarantee Fund in an all-digital procedure implemented from a remote position.
In the future, the digital platform will be progressively extended to also include other products and services.

At the same time, in the Npl business, technological innovation intends to minimise Npl onboarding, management and
monitoring time. In 2021, we will continue to seek out solutions aiming to reduce the time necessary for collecting on
bad loans and limiting structural costs. The Npl business should also benefit from a progressive return to normality in
the courts and the resuming of amicable “home” collections.

Competitive positioning

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