Zagrebacka banka d d : Zagrebačka banka unaudited financial results Q1 2024

Unaudited financial statements of

Zagrebačka banka dd

for the period from 1 January to 31 March 2024

Content:

1. Management report for the period from 1 January to 31 March 2024

1. Statement of the persons responsible for the preparation of the financial statements

III. Financial statements (TFI-KI statements)

1. General data as at 31 March 2024
2. Balance sheet as at 31 March 2024
3. Income statement for the period from 1 January to 31 March 2024
4. Cash flow statement for the period from 1 January to 31 March 2024
5. Statement of changes in equity for the period from 31 December 2023 to 31 March 2024
6. Notes to the financial statements

1. Management report for the period from 1 January to 31 March 2024

Zagrebačka banka dd realised profit after tax of EUR 135 million in the first quarter of 2024. This is EUR 27 million (+25.0%) higher than in Q1 2023.

We achieved excellent results and confirmed healthy growth in all key business segments and a leading position on the market. Our operating income increased, cost management is disciplined. Capital and liquidity positions are strong, assets are covered with prudent loan provisions.

We are strongly connected with our community, providing support to the economy and the society in which we operate. We are doing this by financing most loans in the market, by investing in optimal user experiences as well as in the security of our solutions, by maintaining the robust payment infrastructure and offering the wide scale of services to companies and citizens.

We are transforming our culture, working on simplification and digitalization of our organization and processes to assure sustainability. We promote the green transition and are committed to activities that have an overall positive impact considering environmental, social and governance (ESG) factors.

We are striving to be the best employer possible, by supporting our employees through work-life balance and wellbeing initiatives.

Key performance indicators:

• Operating income: EUR 207 million
• Operating expenses: EUR 58 million
• Profit before impairment and other provisions: EUR 149 million
• Impairment and other provisions: EUR 13 million
• Loans and advances to customers: EUR 10,418 million
• Deposits from customers: EUR 16,405 million

2

1. Management report for the period from 1 January to 31 March 2024 (continued)

Operating income amounted to EUR 207 million, increased by EUR 33 million (+19.0%) Y/Y:

• Net interest income amounted to EUR 146 million, increased by EUR 27 million (+22.7%).
• Net fee and commission income amounted to EUR 42 million, increased by EUR 2 million (+5.0%).
• Net trading and other income and expenses amounted to EUR 19 million, increased by EUR 4 million (+26.7%), mainly due to higher trading result.

Operating expenses at EUR 58 million, higher by EUR 1 million (+1.8%). Cost to income ratio equals to 28.02%.

Profit before impairment and other provisions amounted to EUR 149 million, higher by EUR 36 million (+31.9%), as a result of the previously described movements in Operating income and Operating expenses.

Impairment and other provisions write back amounted to EUR 13 million, decreased by EUR 3 million.

Total assets of the Bank amounted to EUR 20,028 million, lower by EUR 345 million (-1.7%) BoY.

• Net loans and advances to customers amounted to EUR 10,418 million, increased by EUR 133 million (+1.3%) mainly due to increase in retail lending.
• Deposits from customers represent primary source of funding. They amounted to EUR 16,405 million, lower by EUR 590 million (-3.5%), in corporate and retail deposits.
• Deposits from credit institutions at EUR 141 million, down by EUR 64 million (-31.2%).

3

1. Management report for the period from 1 January to 31 March 2024 (continued)
   Financial results for the period from 1 January to 31 March 2024

Zagrebačka banka dd					Δ 1Q 2024 vs 1Q 2023
Income statement (EURm)	1Q 2024		1Q 2023		EURm		%
	1		2		3 (1-2)		4 (3/2)
Interest income	199		137		62		45.3 %
Interest expense	(53)		(18)		(35)		194.4 %
Net interest income	146		119		27		22.7 %
Fee and commission income	51		48		3		6.3 %
Fee and commission expense	(9)		(8)		(1)		12.5 %
Net fee and commission income	42		40		2		5.0 %
Net trading and other income and	19		15		4		26.7 %
expenses
Operating income	207		174		33		19.0 %
Operating expenses	(58)		(57)		(1)		1.8 %
Cash contributions to resolution funds	-	(4)		4		(100.0 %)
and deposit guarantee schemes
Profit before impairment and other	149		113		36		31.9 %
provisions
Impairment and other provisions	13		16		(3)		(18.8 %)
Profit before tax	162		129		33		25.6 %
Income tax	(27)		(21)		(6)		28.6 %
Net profit	135		108		27		25.0 %

4

1. Management report for the period from 1 January to 31 March 2024 (continued)

Financial results for the period from 1 January to 31 March 2024 (continued)

	Zagrebačka banka dd							Δ 2024 vs. 2023
	Balance sheet (EURm)	31 Mar 2024			31 Dec 2023			EURm			%
		1			2			3 (1-2)			4 (3/2)
Cash, cash balances at central	4,394			5,478		(1,084)			(19.8 %)
banks and other demand deposits
Financial assets held for trading	136			218		(82)			(37.6 %)
Non-trading financial assets
mandatorily at fair value through	3			3		-		-
profit or loss
Financial assets at fair value
through other comprehensive	799			749		50		6.7 %
income
Financial assets at amortised cost:	14,065			13,342		723		5.4 %
	Debt securities	1,588			1,460		128		8.8 %
	Loans and advances to credit	2,059			1,597		462		28.9 %
	institutions
	Loans and advances to	10,418			10,285		133		1.3 %
	customers
Tangible and intangible assets	190			188		2		1.1 %
Investments in subsidiaries, joint	289			284		5		1.8 %
ventures and associates
Other assets	152			111		41		36.9 %
Total assets	20,028			20,373		(345)			(1.7 %)
Financial liabilities held for trading	166			248		(82)			(33.1 %)
Fair value changes of the hedged
items in portfolio hedge of interest	(22)			(16)		(6)		37.5 %
rate risk
Financial liabilities measured at	17,063			17,423		(360)			(2.1 %)
amortised cost:
	Debt securities issued	435			151		284		188.1 %
	Deposits from credit institutions	141			205		(64)			(31.2 %)
	Deposits from customers	16,405			16,995		(590)			(3.5 %)
	Other financial liabilities	82			72		10		13.9 %
Provisions for risks and charges	210			213		(3)		(1.4 %)
Other liabilities	152			177		(25)			(14.1 %)
Total liabilities	17,569			18,045		(476)			(2.6 %)
Equity	2,459			2,328		131		5.6 %
Total equity and liabilities	20,028			20,373		(345)			(1.7 %)
	Rating							31 March 2024
Fitch Ratings Ltd.	Long Term Issuer Default Rating		BBB
		Short Term Rating				F2
		Viability				bb-
		Shareholder Support				bbb
		Outlook				Stable

Zagreb, 26 April 2024

5

1. Management report for the period from 1 January to 31 March 2024 (continued)
   Significant events and transactions

Geopolitical tensions and market uncertainties

At the end of March 2024, the Bank's assets were not significantly directly impacted by the geopolitical tensions. Our operations remain indirectly affected, as the overall macro-economic scenario evolves.

The market environment continues to be uncertain, in the short and in the medium-term.

The impacts of uncertainties continue to evolve as of the date of this report. As such, it is fluctuant as to the full magnitude that they will have on the macro-economic scenario and consequentially on the Bank's future financial condition and results of operations.

The Bank continues to support our clients, while it adequately assesses their creditworthiness, carefully considering the risk classification as well as the related impact on financial reporting.

While having a strong capital and liquidity position, as well as the assets covered by prudent loan provisions, the Bank is actively monitoring the situation and assessing its impact on operations, financial performance, capital position and cash-flows.

Ivan Vlaho

Chief Executive Officer,

Chairman of the Management Board

Jasna Mandac

Member of the Management Board

Pavel Vinter

Member of the Management Board

Slaven Rukavina

Member of the Management Board

Tatjana Antolić Jasnić

Member of the Management Board

Gianluca Totaro

Member of the Management Board

6

1. Statement of the persons responsible for the preparation of financial statements

Pursuant to the provisions of the Capital Market Act, to the best of our knowledge:

1. the set of financial statements of Zagrebačka banka dd, prepared in accordance with International Financial Reporting Standards (IFRS) as adopted in the European Union, gives a true and fair view of the assets and liabilities, profit and loss, financial position and business operations of Zagrebačka banka dd;
2. the Management Report includes a fair overview of the development and results of operations and of the position of Zagrebačka banka dd.

Ante Križan	Jasna Mandac
Head of Accounting, Regulatory	Member of the Management Board
Reporting and Tax

Additional info:

Public Relations

Tel: 00385(1) 6104153

e-mail:[e-mail]

7

1. Financial statements (TFI-KI statements)

i. General data as at 31 March 20241

Annex 1

ISSUER'S GENERAL DATA

Reporting period:	1.1.2024	to	31.3.2024
Year:	2024
Quarter:	1

Quarterly financial statements

Registration number (MB):	3234495	Issuer's home Member	HR
State code:
Entity's registration	80000014
number (MBS):
Personal identification	92963223473	LEI: PRNXTNXHBI0TSY1V8P17
number (OIB):
Institution	307
code:

Name of the issuer: Zagrebačka banka d.d.

Postcode and town:

10000

Zagreb

Street and house number: Trg bana Josipa Jelačića 10

E-mailaddress: [e-mail]

Web address: www.zaba.hr

Number of employees	3310
(end of the reporting
Consolidated report:	KN		(KN-notconsolidated/KD-consolidated)	KN	KD
Audited:	RN		(RN-notaudited/RD-audited)	RN	RD
Names of subsidiaries (according to IFRS):	Registered office:		MB:

Yes

No

Bookkeeping firm:

No

(Yes/No)

(name of the bookkeeping firm)

Contact person: Ferizović Antica

(only name and surname of the contact person)

Telephone:

E-mailaddress: [e-mail]

Audit firm: KPMG d.o.o.

(name of the audit firm)

Certified auditor:

(name and surname)

1 Average number of employees in head office and branch network of Zagrebačka banka dd in Q1 2024 amounts to 3,310.

8

1. III. Financial statements (TFI-KI statements)

2. Balance sheet as at 31 March 2024

				in EUR
	Submitter: Zagrebačka banka d.d.
			Last day of
		ADP	the	Current
	Item	preceding
	code	period
		business
			year
	1	2	3	4
	Assets
	Cash, cash balances at central banks and other demand deposits	001	5.477.880.945	4.394.223.094
	(from 2 to 4)
	Cash in hand	002	381.566.923	350.911.258
	Cash balances at central banks	003	5.017.613.289	3.833.414.767
	Other demand deposits	004	78.700.733	209.897.069
	Financial assets held for trading (from 6 to 9)	005	137.349.052	55.906.452
	Derivatives	006	136.842.263	52.916.670
	Equity instruments	007	506.789	497.134
	Debt securities	008	0	2.492.648
	Loans and advances	009	0	0
	Non-trading financial assets mandatorily at fair value through profit	010	7.986.025	8.601.605
	or loss (from 11 to 13)
	Equity instruments	011	7.986.025	8.601.605
	Debt securities	012	0	0
	Loans and advances	013	0	0
	Financial assets at fair value through profit or loss (15 + 16)	014	0	0
	Debt securities	015	0	0
	Loans and advances	016	0	0
	Financial assets at fair value through other comprehensive income	017	748.520.861	798.879.693
	(from 18 to 20)
	Equity instruments	018	716.760	711.438
	Debt securities	019	747.804.101	798.168.255
	Loans and advances	020	0	0
	Financial assets at amortised cost (22 + 23)	021	13.342.454.934	14.065.003.362
	Debt securities	022	1.460.301.957	1.588.153.569
	Loans and advances	023	11.882.152.977	12.476.849.793
	Derivatives - hedge accounting	024	72.167.544	71.556.951
	Fair value changes of the hedged items in portfolio hedge of interest	025	3.248.246	2.990.053
	rate risk
	Investments in subsidiaries, joint ventures and associates	026	284.219.764	289.311.454
	Tangible assets	027	142.424.800	145.364.778
	Intangible assets	028	46.327.015	44.600.388
	Tax assets	029	78.500.991	63.585.766
	Other assets	030	32.155.327	87.885.055
	Fixed assets and disposal groups classified as held for sale	031	0	0
	Total assets (1 + 5 + 10 + 14 + 17 + 21 + from 24 to 31)	032	20.373.235.504	20.027.908.651
	Liabilities
	Financial liabilities held for trading (from 34 to 38)	033	127.563.726	48.685.753
	Derivatives	034	127.563.726	48.685.753
	Short positions	035	0	0
	Deposits	036	0	0
	Debt securities issued	037	0	0
	Other financial liabilities	038	0	0
	Financial liabilities at fair value through profit or loss (from 40 to 42)	039	0	0
	Deposits	040	0	0
	Debt securities issued	041	0	0
	Other financial liabilities	042	0	0
	Financial liabilities measured at amortised cost (from 44 to 46)	043	17.423.317.352	17.062.678.497
	Deposits	044	17.200.204.925	16.546.103.594
	Debt securities issued	045	151.294.125	434.899.778
	Other financial liabilities	046	71.818.302	81.675.125
	Derivatives - hedge accounting	047	120.111.234	117.213.884
	Fair value changes of the hedged items in portfolio hedge of interest	048	-16.298.277	-22.284.394
	rate risk
	Provisions	049	212.993.535	209.855.429
	Tax liabilities	050	33.865.829	29.621.538
	Share capital repayable on demand	051	0	0
	Other liabilities	052	143.756.038	122.866.038
	Liabilities included in disposal groups classified as held for sale	053	0	0
	Total liabilities (33 + 39 + 43 + from 47 to 53)	054	18.045.309.437	17.568.636.745
	Equity
	Capital	055	850.068.233	850.068.233
	Share premium	056	464.975.040	464.975.040
	Equity instruments issued other than capital	057	0	0
	Other equity	058	1.284.521	1.284.521
	Accumulated other comprehensive income	059	-20.142.430	-24.285.685
	Retained profit	060	521.058.225	971.452.715
	Revaluation reserves	061	0	0
	Other reserves	062	61.175.022	61.175.022
	( - ) Treasury shares	063	-853.349	-853.349
	Profit or loss attributable to owners of the parent	064	450.360.805	135.455.409
	(--) Interim dividends	065	0	0
	Minority interests [non-controlling interests]	066	0	0
	Total equity (from 55 to 66)	067	2.327.926.067	2.459.271.906
	Total equity and liabilities (54 + 67)	068	20.373.235.504	20.027.908.651	9

1. Financial statements (TFI-KI statements)

iii. Income statement for the period from 1 January to 31 March 2024

					in EUR
Submitter: Zagrebačka banka d.d.
Item	ADP	Same period of the previous year	Current period
code
		Cumulative	Quarter	Cumulative	Quarter
1	2	3	4	5	6
Interest income	001	137.053.453	137.053.453	198.710.876	198.710.876
(Interest expenses)	002	17.607.407	17.607.407	51.519.980	51.519.980
(Expenses on share capital repayable on demand)	003	0	0	0	0
Dividend income	004	10.750.673	10.750.673	13.754.035	13.754.035
Fees and commissions income	005	47.784.738	47.784.738	50.614.980	50.614.980
(Fees and commissions expenses)	006	7.588.604	7.588.604	8.772.002	8.772.002
Gains or (-) losses on derecognition of financial assets and	007	4.264	4.264	0	0
liabilities not measured at fair value through profit or loss, net
Gains or (-) losses on financial assets and liabilities held for	008	-684.440	-684.440	-4.409.336	-4.409.336
trading, net
Gains or losses on non-trading financial assets mandatorily at fair	009	1.211.517	1.211.517	475.084	475.084
value through profit or loss, net
Gains or (-) losses on derecognition of financial assets and liabilities	010	0	0	0	0
at fair value through profit or loss, net
Gains or (-) losses from hedge accounting, net	011	-161.551	-161.551	52.764	52.764
Exchange rate differences [gain or (-) loss], net	012	3.805.719	3.805.719	8.106.242	8.106.242
Gains or (-) losses on derecognition of of investments in	013	0	0	0	0
subsidiaries, joint ventures and associates, net
Gains or (-) losses on derecognition of non-financial assets, net	014	3.600	3.600	19.930	19.930
Other operating income	015	1.114.592	1.114.592	1.436.169	1.436.169
(Other operating expenses)	016	785.026	785.026	906.345	906.345
Total operating income, net (1 - 2 - 3 + 4 + 5 - 6 + from 7 to 15 -	017	174.901.528	174.901.528	207.562.417	207.562.417
16)
(Administrative expenses)	018	50.598.733	50.598.733	51.202.241	51.202.241
(Cash contributions to resolution boards and deposit guarantee	019	4.302.379	4.302.379	165.000	165.000
schemes)
(Depreciation)	020	6.416.671	6.416.671	6.840.603	6.840.603
Modification gains or (-) losses, net	021	0	0	0	0
(Provisions or (-) reversal of provisions)	022	3.988.657	3.988.657	1.797.317	1.797.317
(Impairment or (-) reversal of impairment on financial assets not	023	-19.751.394	-19.751.394	-14.491.313	-14.491.313
measured at fair value through profit or loss)
(Impairment or (-) reversal of impairment of investments in	024	0	0	895	895
subsidiaries, joint ventures and associates)
(Impairment or (-) reversal of impairment on non-financial assets)	025	48.530	48.530	0	0
Negative goodwill recognised in profit or loss	026	0	0	0	0
Share of the profit or (-) losses of investments in subsidiaries, joint	027	0	0	146.714	146.714
ventures and associates accounted for using the equity method
Profit or (-) loss from fixed assets and disposal groups classified as	028	0	0	0	0
held for sale not qualifying as discontinued operations
Profit or (-) loss before tax from continuing operations (17 - 18 to 20 +	029	129.297.952	129.297.952	162.194.388	162.194.388
21 - from 22 to 25 + from 26 to 28)
(Tax expense or (-) income related to profit or loss from continuing	030	21.396.644	21.396.644	26.738.979	26.738.979
operations)
Profit or (-) loss after tax from continuing operations (29 - 30)	031	107.901.308	107.901.308	135.455.409	135.455.409
Profit or (-) loss after tax from discontinued operations (33 - 34)	032	0	0	0	0
Profit or (-) loss before tax from discontinued operations	033	0	0	0	0
(Tax expense or (-) income related to discontinued operations)	034	0	0	0	0
Profit or ( - ) loss for the year (31 + 32; 36 + 37)	035	107.901.308	107.901.308	135.455.409	135.455.409
Attributable to minority interest [non-controlling interests]	036	0	0	0	0
Attributable to owners of the parent	037	107.901.309	107.901.309	135.455.409	135.455.409
STATEMENT OF OTHER COMPREHENSIVE INCOME
Income or (-) loss for the current year	038	107.901.308	107.901.308	135.455.409	135.455.409
Other comprehensive income (40+ 52)	039	2.178.114	2.178.114	-4.143.255	-4.143.255
Items that will not be reclassified to profit or loss (from 41 to 47	040	-80.706	-80.706	-38.049	-38.049
+ 50 + 51)
Tangible assets	041	-107.503	-107.503	-41.080	-41.080
Intangible assets	042	0	0	0	0
Actuarial gains or (-) losses on defined benefit pension plans	043	0	0	0	0
Fixed assets and disposal groups classified as held for sale	044	0	0	0	0
Share of other recognised income and expense of entities	045	0	0	0	0
accounted for using the equity method
Fair value changes of equity instruments measured at fair value	046	9.081	9.081	-5.321	-5.321
through other comprehensive income
Gains or (-) losses from hedge accounting of equity instruments at	047	0	0	0	0
Fair value changes of equity instruments measured at fair value	048	0	0	0	0
Fair value changes of equity instruments measured at fair value	049	0	0	0	0
Fair value changes of financial liabilities measured at fair value	050	0	0	0	0
through profit or loss attributable to changes in their credit risk
Income tax relating to items that will not be reclassified	051	17.716	17.716	8.352	8.352
Items that may be reclassified to profit or loss (from 53 to 60)	052	2.258.820	2.258.820	-4.105.206	-4.105.206
Hedge of net investments in foreign operations [effective portion]	053	0	0	0	0
Foreign currency translation	054	0	0	0	0
Cash flow hedges [effective portion]	055	7.628.876	7.628.876	-3.505.490	-3.505.490
Hedging instruments [not designated elements]	056	0	0	0	0
Debt instruments at fair value through other comprehensive income	057	-4.874.217	-4.874.217	-1.500.859	-1.500.859
Fixed assets and disposal groups classified as held for sale	058	0	0	0	0
Share of other recognised income and expense of investments in	059	0	0	0	0
subsidiaries, joint ventures and associates
Income tax relating to items that may be reclassified to profit or (-)	060	-495.839	-495.839	901.143	901.143
loss
Total comprehensive income for the current year (38 + 39; 62 +	061	110.079.422	110.079.422	131.312.154	131.312.154
63)
Attributable to minority interest [non-controlling interest]	062	0	0	0	0
Attributable to owners of the parent	063	110.079.422	110.079.422	131.312.154	131.312.154	10