07/08/2024 - ABN Amro Bank NV: Pre-close note 2024 Q2

Fee and commission income in Q1 2024 was 469m

• Fee income in Personal & Business Banking in Q1 benefitted from the increase in payment packages as well as high transaction volumes
• Wealth management fee income depends on the volume of our assets under management, which is impacted by market performance. Equity market performance was positive in Q2
• Corporate Banking in Q1 included strong capital market fees

Other income in Q1 2024 was 139m

• Other income is volatile by nature. In Q2 other income will be impacted by a limited downward revaluation of our stake in Neuflize Vie

Operating expenses in Q1 2024 were 1,257m and included 23m regulatory levies

• The Dutch Deposit Guarantee Scheme reached its target size of 0.8% of total deposits in the Netherlands. We expect some limited maintenance contributions going forward
• For Q2 2024 we expect regulatory levies of around 10m

Beyond Q2, our new 2-year CLA will start as of July with a salary increase of 6% per 1 July 2024, and a further increase of 3.75% as of 1 July 2025. Employees not at the end of their pay scale will receive a fixed annual increase of 2.5% per 1 April, replacing the performance based annual increase ranging between 0-7% (averaging c.3%). The CLA introduces an individual reward premium of 0%, 2.5% or 5.0% paid-out in March, which will be accrued during the preceding year. Starting 1 January 2025 the pension premium contribution by the bank (as percentage of pensionable earnings), will be lowered from 37% to 30%.

Loan impairments in Q1 2024 were 3m

• In Q1 net inflow in stage 3 was largely offset by improved macro-economic scenarios and a small decrease in management overlays
• Bankruptcies in the Netherlands remain relatively low but have showed a gradual increase

A gradual normalisation of impairments is expected towards the lower end of the through the cycle Cost of Risk of 15-20bps.

Tax: effective tax rate in Q1 2024 was 28.1%

• The Dutch corporate tax rate is 25.8%. However due to the 'thin capitalisation' tax rule, our effective tax rate is somewhat higher

Capital: Basel III CET1 ratio in Q1 2024 was 13.8% and our Basel IV CET1 ratio around 14%

• In Q1 RWAs increased mainly from model-relatedadd-ons and seasonal business developments
• CET1 capital in Q1 was in addition impacted by capital deductions, which included the effect of transferring portfolios to less sophisticated approaches
• Our dividend policy includes an interim dividend of 40% of H1 reported net profit. The ex-dividend date is August 14 and the payment date is September 11
• As announced last year, the Dutch Countercyclical Buffer increased from 1% to 2% as of May, while the buffer for Other Systemically Important Institutions declined by 25bps to 1.25%. This

results in an increase in our CET1 capital requirement to 11.2%

As mentioned before, we are continuing the review of our credit risk RWA models, which may lead to further model updates and RWA add-ons under both Basel III and Basel IV. We will review our capital position annually with respect to the decision on potential share buybacks and will disclose the outcome with our Q4 results publication.

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Please note that ABN AMRO Investor Relations will be in closed period as of close of business on 17 July 2024. ABN AMRO will publish its Q2 2024 results on 7 August 2024 at 07:00 CET.

This document is provided for information purposes only. It does not constitute an offer to sell or the solicitation to buy any security issued by ABN AMRO nor does it constitute investment advice or an investment recommendation. ABN AMRO believes that this document is reliable, although some information is condensed and therefore incomplete. ABN AMRO cannot be held liable for any loss or damage resulting from the use of the information. This document may include forward-looking statements with respect to future developments in our business, with respect to expectations for our future financial performance and with respect to indicative impacts of recent external events. By their nature, forward-looking statements are subject to uncertainties. There is a risk that actual results differ materially from those projected in any forward-looking statement.

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