Delta BankPresentation

SUK001BJ1 v2

Delta Bank in the Media

2

Forbs Magazine informs that during the 1-st half of 2013 Delta Bank advanced from the 8-th to the 4-th place by assets (http://forbes.ua/business/1356667-top-10-bystrorastushchih-bankov-ukrainy/1356673)

In the 1-st half of 2013, Delta Bank was the 2-nd fastest growing bank in Ukraine by the loan portfolio growth in money terms (+10 bln. UAH) and the 3-rd – by the growth in relative terms (+59.6%) (http://minfin.com.ua/2013/08/13/796094/)

Forinsurer.com placed Delta Bank on the 4-th place as one of the safest banks in Ukraine in 2013 (http://forinsurer.com/rating-banks)

Financial Highlights

3

Delta’s (stand along) position among Ukrainian banks

(01 October 2013)

Assets 4

Loan Portfolio 4

Corporate Deposit Portfolio 5

Retail Deposit Portfolio 2

Total Assets   c. $6.8 bn

Equity   $ c. 407 m

Net Profit for 1H2013   $17 m

Cash In Hand, accnts with NBU, other

banks

  $ 1.319 m

Total customer base   > 3.5 m

Loans to Private Individuals   $ 2.016 m

Retail Deposit Portfolio   $ 2.973 m

Corporate Loan Portfolio   $ 2.195 m

Number of Employees   c. 6000

01 October 2013

SUK001BJ1 v2

Ownership Structure

Nikolay Lagun

Cargill, Inc.

40-year-old founder and original CEO of Bank Delta

Personal Details:

Education: Degree in Accounting, Ph. D. in Economics from Kyiv National Economic University

Professional Experience: ex-shareholder of a top-5 bank in Ukraine 14 years of banking experience over 8 years in Board level positions Entrepreneur of the Year 2007 in Ukraine by

Ernst&Young Financier of 2008 in Ukraine by ‘Man of the Year’

Award4

Cargill Financial Services International, Inc. utilized NBU's permit for acquisition of material stake equal to 30.1% in the bank's capital, issued pursuant to decision of NBU's Commission of Banking Control and Regulation No.57 dated 24.02.2011.

Cargill is an international producer and marketer of food, agricultural, financial and industrial products and services. Founded in 1865, our privately held company employs 142,000 people in 65 countries.

Thousands of customers turn to Cargill for innovative solutions across four major market segments:

• Agriculture

• Food

• Financial

• Industrial

In fiscal year 2012, Cargill had $133.9 billion in sales and other revenues. Earnings from continuing operations were $1.17 billion.

5

0

1 000 000

2 000 000

3 000 000

4 000 000

5 000 000

6 000 000

7 000 000

2010 2011 2012 1H2013E

Loans to Private Individuals, gross Corporate Loans, gross Total Assets

+68%

+29%

+60%

Y-t-Y

Y-t-Y

Delta Bank Financial Highlights (stand alone)

Ranking among Ukrainian Banks

6

050,000,000

100,000,000150,000,000200,000,000250,000,000202,551,282

92,319,84591,097,67954,040,87340,236,68744,803,82337,328,51929,345,99833,571,75229,089,03224,446,64128,496,24934,959,08126,414,92523,145,343

Top Ukrainian Banks by Assets as of 01.10.2013, UAH mio

Privat

Delta

Ukrsots

bank

Nadra

RBA

Ukrsibb

ank

Alfa B

ank

PUMB

Financ

e and

Cred

itVTB

Oscha

dban

k

Ukrgaz

bank

Sberba

nk of

Rus

sia

Ukrexim

bank PIB

05,000,000

10,000,00015,000,00020,000,00025,000,00022,771,689

16,135,47111,549,26910,710,349

8,286,8187,189,7454,626,7083,934,2163,174,8813,022,8992,738,2151,994,074999,115458,508119,759

Top Ukrainian Banks by Retail Loan Portfolio as of 01.10.2013, UAH mio

020,000,00040,000,00060,000,00080,000,000

100,000,000120,000,000

101,004,044

36,110,42423,786,30616,655,50715,652,54413,335,65212,153,97711,518,24510,354,8999,986,9129,031,8898,014,5697,329,5185,531,6985,504,844

Top Ukrainian Banks by Retail Deposit Portfolio as of 01.10.2013, UAH mio

05,000,000

10,000,00015,000,00020,000,00025,000,00030,000,00026,458,280

22,990,657

13,082,76911,009,71510,048,1138,133,7888,009,7906,963,2225,997,3765,333,5045,257,8905,146,0784,947,5154,235,1124,162,071

Top Ukrainian Banks by Corporate Deposit Portfo-lio as of 01.10.2013, UAH mio

Market Position

7Source: NBU

01/01/2013 01/09/20130.00%

0.50%

1.00%

1.50%

2.00%

2.50%

1.59%

2.30%

Share of Ukrainian Banks Corporate Loan Portfolio

+ 0,71%

01/01/2013 01/09/20130.00%1.00%2.00%3.00%4.00%5.00%6.00%7.00%8.00%9.00%

10.00%

5.70%

9.10%

Share of Ukrainian Banks Retail Loan Portfolio

+ 3,4%

01/01/2013 01/09/20130.00%0.50%1.00%1.50%2.00%2.50%3.00%3.50%4.00%4.50%5.00%

1.69%

4.30%

Share of Ukrainian Banks Corporate Deposit Portfolio

+ 2,61%

01/01/2013 01/09/20130.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

3.61%

5.50%

Share of Ukrainian Banks Retail Deposit Portfolio

+ 1,89%

Historic Development

8

Acquisition of Ukrprombank’s

portfolio kick-start to Corporate

business

Share Capital

Injection

Ukrsibbank NPL portfolio Acquisition

SwedBank’s retail portfolio

Acquisition

Balance Sheet Dynamics

Portfolio Growth

Acquisition of Kreditprombank 28.02.13 (assets

USD 1.5bn)

Acquisition of Swedbank

01.04.13 (assets USD 300mio)

Acquisition of Astra

Bank 18.06.13

(assets USD 200mio)

01/12/2009 01/06/2010 01/12/2010 01/06/2011 01/12/2011 01/06/2012 01/12/2012 01/06/20130

5,000,000,00010,000,000,00015,000,000,00020,000,000,00025,000,000,00030,000,000,00035,000,000,00040,000,000,00045,000,000,00050,000,000,000

0

500,000,000

1,000,000,000

1,500,000,000

2,000,000,000

2,500,000,000

3,000,000,000

3,500,000,000

TOTAL ASSETS NET LOAN PORTFOLIO EQUITY

01/01/2010 01/07/2010 01/01/2011 01/07/2011 01/01/2012 01/07/2012 01/01/2013 01/07/20130

2000

4000

6000

8000

10000

12000

14000

16000

18000

Corporates, gross Individuals, gross

UA

H, m

io

Profitability YE 2012

9

31%

69%

Revenue from Clients, %

Corporates Net Interest Margin (YE2012) 7,59%

1%

95%

4%Revenue structure,%

Due from BanksDue from ClientsSecurities

Delta Bank’s net income 2012 amounted to UAH 97,8 mio, which is in fact TOP-12 result in the banking system;

The following factors made significant impact on the bank’s profit:

Net interest income of UAH 1 829,8 mio (111% of budgeted);

Net fees & commission income of UAH 487,2 mio (241% of budgeted, incl. through increase of card fees);

Net operating income of UAH 2 099,7 mio (115,76% of budgeted);

Decrease of administrative and other expenses (84,2% of budgeted due to costs optimization);

Loans provisioning in the amount of UAH 1 230,4 mio.

Business Directions

10

Treasury

Investment Banking

Financial Institutions

CORPORATE BUSINESS

Clients with gross annual turnover above $10 mio

DELTA PREMIER

VIP / Ultra High Net Worth Individuals

FIs and IB

Treasury/ Financial

Institutions operations

AndInvestment Banking

BRANCHES

RETAIL BUSINESS

Internet

POS

SMEs

44

10

6

19 28

2

13

3

10

3

8

6

98

7

34

315

7

4 3

2

5

4

Branch Network

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226 BranchesPlan for January 2014 – 228 branches.

Strategy implementation

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2010 – acquisition of assets of Ukrprombank on public auction from temporary administration. Start of corporate banking development and expansion

09/2013 – TOP 4 bank in Ukraine by Total Assets – $ 6.5 bln

2011 – Ukraine’s # 1 Dynamic Bank in 2011 by Net Profit Growth

Q4 2012 -Q1 2013 - successful acquisition of Kreditprombank (TOP 20) and Swedbank Ukraine(TOP 60). Planned integration process in 2013-2014

2011-2012 - # 1 government bonds trader (“OVGZ”) in Ukraine

2012 – became part of Largest Banks Group in Ukraine according to classification of National Bank of Ukraine.

Q4 2011 – Q2 2012 acquisition of two retail loan portfolios: NPL (UkrSibbank BnP Paribas) and PL (Swedbank Ukraine) with an aim to client base diversification

Second largest consumer finance portfolio in Ukraine with over 3.8 million clientsInternet banking platform development and growth up to 300k clients.

Subsequent events in 1H 2013 (stand alone)

13

Assets grew by 72% up to $6.5bn

2013 – Ukraine’s # 1 Dynamic Tier 1 Bank

Increase of loan portfolio by 61% up to $3.7bn

Attracted subordinated debt in amount of $252m

Increase operating income by 26% comparing to 1H 2012

Increase in corporate deposits by 165% up to $1.2 bn and increase in retail deposits by 74% up to $2.8 bn

Local currency bonds successfully placed in the amount of UAH 200mio

IFRS Financials: Statement of Comprehensive Income (non - audited, stand alone)

14

$k 2011 2012 9m 2013Interest income 523,824 402,825 391,813Interest expense (194,005) (331,361) (419,139)Net interest income/(loss) 329,819 71,464 (27,325)Fee and commission income 90,809 213,324 268,861Fee and commission expense (3,695) (7,344) (10,696)

Trading gains/(losses) 190,065 (6,875) (671)Provision for loan impairment, bakances with banks and other assets (156,979) (154,695) (91,161)Other operating income 14,252 25,273 36,902Operating income 464,272 141,145 175,910

0

Administrative and other operating expenses (392,851) (127,492) (149,768)

Profit before tax 71,421 13,658 26,142Income tax expense (27,866) (2,145) (231)Net profit (loss) for the year 43,556 11,513 25,911

Other comprehensive incomeRevaluation of investment securities available for sale 6,973 (4,647) -

Total comprehensive income for the year 50,529 6,866 25,911

IFRS Financials: Statement of Financial Position(non - audited, stand alone)

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$k 31-Dec-11 31-Dec-12 30-Sep-13AssetsCash and cash equivalents and balances with NBU 342,429 675,596 281,887 Mandatory reserves with NBU 22,138 40,671 51,887

Financial assets through profit and loss 106,479 107,002 450,429 Due from other banks 26,476 30,911 1,036,735

Loans and advances to customers, net 1,709,809 2,338,865 3,812,840 Investment securities available for sale 301,876 255,738 51,832 Investment properties 143,931 157,106 - Current income tax receivable - 626 - Property, equipment and intangible assets 35,995 43,255 230,207 Other financial assets 19,430 39,338 454,315 Other assets 14,725 10,591 4,762 Assets held for sale 193 9,409 438,019 Total assets 2,723,480 3,709,108 6,812,912

LiabilitiesDue to other banks 922,589 971,918 1,388,157 Customer accounts 1,304,742 2,168,076 4,174,459 Derivative financial instruments 636 442 - Debt securities issued 144,495 150,632 149,167 Other borrowed funds - 11,260 11,885 Deferred income tax liability 28,787 30,077 317,752 Provisions and charges 2,498 441 614 Other financial liabilities 1,677 1,544 - Other liabilities 3,137 4,395 122,318 Subordinated debt 35,795 - 241,237 Total liabilities 2,444,354 3,338,785 6,405,588

- - - Equity - - - Share capital 103,507 291,130 291,130 Unregistered share capital 103,257 - - Retained earnings 53,188 5,953 109,160 Reserve and other funds 12,303 71,017 - Revaluation reserve 6,871 2,223 7,033 Total equity 279,126 370,323 407,323

- - - Total equity and liabilities 2,723,480 3,709,108 6,812,911

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Thanks for your attention!