Banca Mediolanum S.p.A. Board of Directors’ Report on the ... · remuneration policies consistent...

Version approved by the Board of Directors on 28 February 2019

Banca Mediolanum S.p.A.

Board of Directors’ Report on the GroupRemuneration Policies

Board of Directors meeting of 28 February 2019

Document drawn up pursuant to Art. 123-ter of Italian Legislative Decree no. 58/1998, Art. 84-quater

of the Issuers’ Regulation and Circular no. 285 of 17 December 2013 of Bank of Italy

2Version approved by the Board of Directors on 28 February 2019

Contents

LETTER FROM THE CHAIRMAN OF THE REMUNERATION COMMITTEE ...................................................... 4

INTRODUCTION.............................................................................................................................................................. 5

PURPOSE AND STRUCTURE OF THE DOCUMENT.............................................................................................. 5

SECTION I ........................................................................................................................................................................ 6

1 ROLES AND RESPONSIBILITIES OF THE BODIES AND PARTIES INVOLVED IN THE PROCESS OFPREPARING AND IMPLEMENTING REMUNERATION POLICIES.............................................................. 6

1.1 SHAREHOLDERS’ MEETING ................................................................................................................................ 6

1.2 BOARD OF DIRECTORS ....................................................................................................................................... 6

1.3 REMUNERATION COMMITTEE .............................................................................................................................. 8

1.4 CHIEF EXECUTIVE OFFICER ............................................................................................................................... 9

1.5 HUMAN RESOURCES .......................................................................................................................................... 9

1.6 SALES NETWORK ADMINISTRATION ................................................................................................................. 10

1.7 COMMERCIAL POLICIES, CAREER AND NETWORK TOOLS ............................................................................... 10

1.8 PLANNING AND CONTROL................................................................................................................................. 11

1.9 RISK MANAGEMENT .......................................................................................................................................... 11

1.10 COMPLIANCE..................................................................................................................................................... 11

1.11 INTERNAL AUDIT ............................................................................................................................................... 12

2 IDENTIFICATION OF THE MOST SIGNIFICANT PERSONNEL .................................................................. 12

2.1 PERSONNEL RECOGNITION AND ANALYSIS ....................................................................................................... 13

2.2 OUTCOMES AND RELATIVE FORMALISATION.................................................................................................... 13

2.3 EXCLUSION ....................................................................................................................................................... 14

3 REASONS AND AIMS PURSUED WITH THE REMUNERATION POLICIES ............................................ 14

4 USING BENCHMARKS FOR DIRECTORS AND EMPLOYEES .................................................................. 14

5 REMUNERATION STRUCTURE OF THE DIRECTORS, STATUTORY AUDITORS AND EMPLOYEES.................................................................................................................................................................................. 15

5.1 FIXED REMUNERATION...................................................................................................................................... 15

5.2 RATIO BETWEEN FIXED AND VARIABLE REMUNERATION .................................................................................. 15

5.3 PURPOSE OF THE VARIABLE REMUNERATION................................................................................................... 16

5.4 VARIABLE REMUNERATION OF THE MEMBERS OF THE BODIES HAVING A STRATEGIC SUPERVISION AND

CONTROL FUNCTION ..................................................................................................................................................... 17

5.5 VARIABLE REMUNERATION OF THE MOST SIGNIFICANT PERSONNEL AND OF THE REMAINING EMPLOYEES .. 17

5.6 PERFORMANCE OBJECTIVES............................................................................................................................ 19

5.7 TREATMENT PLANNED IN THE CASE OF EARLY TERMINATION OF EMPLOYMENT FOR THE DIRECTORS AND

EMPLOYEES .................................................................................................................................................................. 19


5.8 NON-MONETARY BENEFITS FOR DIRECTORS AND EMPLOYEES....................................................................... 20

5.9 OTHER FORMS OF REMUNERATION .................................................................................................................. 20

6 REMUNERATION STRUCTURE OF THE SALES NETWORK .................................................................... 20

6.1 COLLABORATORS PLAN.................................................................................................................................... 21

6.2 TREATMENT PLANNED IN THE CASE OF TERMINATION OF THE AGENCY AGREEMENT OR REDUCTION OF THE

ASSIGNMENT OF SUPERVISION, ASSISTANCE, AND COORDINATION............................................................................. 22

6.3 CONDITIONS APPLIED TO PRODUCTS AND SERVICES OFFERED TO THE SALES NETWORK BY THE BANK....... 23

7 ASSESSMENT OF SUSTAINABILITY RELATING TO THE OWN FUNDS REQUIREMENTS .............. 23

8 MALUS AND CLAW BACK MECHANISMS FOR THE DIRECTORS, EMPLOYEES AND SALESNETWORK ............................................................................................................................................................. 24

SECTION II ..................................................................................................................................................................... 25

1 IMPLEMENTATION OF THE REMUNERATION POLICIES IN 2018........................................................... 25

2 GOVERNANCE...................................................................................................................................................... 25

2.1 MEETINGS AND COMPOSITION OF THE REMUNERATION COMMITTEE.............................................................. 25

2.2 EXTERNAL CONSULTANTS ................................................................................................................................ 25

3 FIXED REMUNERATION AND PAY MIX.......................................................................................................... 25

4 VARIABLE REMUNERATION AND NON-RECURRING COMPONENT (PERFORMANCE SHAREPLANS) ................................................................................................................................................................... 27

4.1 TOP MANAGEMENT INCENTIVE PLAN 2018 ..................................................................................................... 28

4.2 COLLABORATORS INCENTIVE PLAN 2018 ........................................................................................................ 30

4.3 INDIVIDUAL QUANTITATIVE OBJECTIVES............................................................................................................ 32

4.4 INDIVIDUAL QUALITATIVE OBJECTIVES .............................................................................................................. 32

4.5 METHODS FOR DISBURSING THE NON-RECURRING COMPONENT .................................................................... 32

5 INCENTIVE PLANS ADOPTED BY THE GROUP RELATING TO PREVIOUS YEAR THAT HAVE NOTYET CLOSED ........................................................................................................................................................ 33

5.1 CAPITAL INSTRUMENTS-BASED PLANS: “2010 TOP MANAGEMENT PLAN” ...................................................... 33

5.2 CAPITAL INSTRUMENTS-BASED PLANS (2010 COLLABORATORS PLAN) ......................................................... 33

6 QUANTITATIVE INFORMATION PROVIDED PURSUANT TO ART. 123-TER OF ITALIANLEGISLATIVE DECREE NO. 58 (CONSOLIDATED FINANCE ACT) OF FEBRUARY 1998; ART. 84-QUATER OF CONSOB ISSUERS’ REGULATION NO. 11971 .................................................................... 35

6.1 EQUITY INVESTMENTS HELD ............................................................................................................................. 47

7 QUANTITATIVE INFORMATION PURSUANT TO CIRCULAR NO. 285, PART I, TIT. IV, CH. 2 ANDART. 450, PARAGRAPH 1(A-F) OF THE CRR ............................................................................................... 48


LETTER FROM THE CHAIRMAN OF THE REMUNERATION COMMITTEE

In the capacity of Chairman of the RemunerationCommittee, I am pleased to present theShareholders the Remuneration Policy of theBanca Mediolanum Group for the year 2019.

First of all, I like to think the Chairman of the lastRemuneration Committee Angelo Renoldi, and theother members of the committee stepping down forits major effort and great job having createdremuneration policies consistent with the Group’sobjectives and with the need to attract and retainresources.

The positive results the Group achieved in 2018highlight the ongoing reinforcement of the businessmodel, while the payout shows how perfectly thecorrective measures under the incentive systemsin place work in order to maintain completeconsistency of the bonuses and the valuegenerated net of the risks.

For the Group, 2018 was also the year of renewalof the Board of Directors and the related internalboard committees. Against this backdrop, themembers of the new Remuneration Committeefollowed an induction programme from the verystart which helps to delve into and boost know-howon technical topics inherent to the committee’s roleOur goal is to formulate clear, effective andtransparent sustainability-oriented remunerationpolicies, and above all, firmly tied to a prospect ofconstant alignment with the interest of theshareholders.

In defining the Remuneration Policy, picking upfrom last year the Remuneration Committeeworked towards the consolidation and updating ofthe remuneration policies in order to guarantee anarchitecture in line both with Group strategy andcurrent regulations, as well as the best marketpractices; it took into account the Group structure,the values and the mission that inspires it, as wellas the indications that emerged from thefavourable result of the vote taken at the lastShareholders’ Meeting.

In light of the positive results reached by the 2018Remuneration Policy and the good positioningachieved in the market of reference, it was deemed

opportune to basically keep the remunerativestructure unaltered. This, also in consideration ofthe 25th update of the Bank of Italy “Supervisoryprovisions for the banks”, which required a processof fine-tuning of the policies, already substantiallycompliant with new regulatory provisions.

Specifically, the main new additions to the 2019Remuneration Report regard:

• introduction of a new condition for access(Total Capital Ratio), by virtue of the regulatoryrequirements to take into account the cost and levelof the capital in the structuring of incentivesystems;

• confirmation of the performance shareplans without needing to resort to the buybackinstrument for the 2019 plan;

• review of the rules for the amounts agreedin view of or upon early termination of the workrelationship or early end of the assignment, withoutchanging the maximum limits set, but updating thetermination criteria to adjust them to the newsupervisory provisions, which provide a detailedbreakdown of the components falling under thiscategory.

All of the forgoing operations—although in anongoing framework—have been carried out in theperspective of continuous improvement of theRemuneration Policies and incentive systems,especially for the sales network, in order tostrengthen the bond between the creating value forthe Group and the payment of the personnelinvolved in the incentive systems.

Also in the name of the other members of thecommittee, I would like to affirm our continueddedication in pursuing an ever clearer disclosureboth of implementation of the remuneration policiesabove and of defining the new ones to benefit theshareholders and all stakeholders in general.

Warm regards

Mario NotariChairman, Remuneration Committee


INTRODUCTION

This document is drawn up by Banca Mediolanum S.p.A. (hereinafter also “Parent Company”) pursuant to Art.114-bis and 123-ter of Italian Legislative Decree 58/1998 (Consolidated Finance Act) and Art. 84-quater ofthe Issuers’ Regulation and in conformity with Bank of Italy measure “Supervisory Provisions for the Banks”,Bank of Italy Circular no. 285 dated 17 December 2013, 25th update of 23 October 20181” hereinafter the“Provisions” or the “Supervisory Provisions”) and it applies to the entire banking Group2 (hereinafter “Group”).

The Supervisory Provisions for the banks divide the Italian banks into three categories for those aspectspertaining to the remuneration policies, i.e.:

• banks that are larger or that have more complex operations (banks with assets over Euro 30 billion);

• intermediate banks (banks with assets ranging from Euro 3.5 billion to Euro 30 billion);

• banks that are smaller or that have less complex operations (banks with assets equal to or under Euro 3.5billion);

Pursuant to the above regulations, the banking Group belongs to the “intermediate” intermediaries categorybased on its total asset at the end of the year of reference3.

The Group policies defined herein by Banca Mediolanum are also implemented by the foreign subsidiaries,based on each of their characteristics and in observance of the limits applicable to them by the regulations ofthe sector and/or of their respective countries in force at the time.

PURPOSE AND STRUCTURE OF THE DOCUMENT

Pursuant to Art. 123-ter of Italian Legislative Decree no. 58 of 24 February 1998 (Consolidated Finance Act),the information for the Shareholders’ Meeting of Banca Mediolanum S.p.A. regarding the 2019 policies andimplementation of the remuneration and incentive policies in 2018 is provided below.

The information is drawn up in compliance with the layout 7-bis of Annex 3A of CONSOB Issuers’ Regulationno. 11971, and it contains two distinct sections.

• SECTION I:

- illustrates the Group policy on remuneration of the personnel, and particularly of the administration andcontrol bodies, the general managers and key management with reference at least to the following year,and the most significant personnel (hereinafter also “MRTs Personnel”) identified pursuant to the Bank ofItaly provisions;

- illustrates the procedures used for adopting and implementing this policy.

• SECTION II:

- illustrates detailed information on implementation of the policies of the previous year and the operationmechanisms of the incentive systems adopted;

- provides an adequate representation of each of the items making up the remuneration and analyticallyexplains the remunerations paid during the year of reference for any reason and in any form by theCompany and by subsidiaries or associates, pointing out any components of these remunerationsreferring to activities carried out during years prior to the one of reference and also providing theremunerations to be paid during one or more years afterwards for the activity carried out during the yearin question, indicating an estimated value for the components not objectively quantifiable during the yearof reference where necessary.

1 Compliance with the applicable sector regulations, including what is set out in the joint Bank of Italy-CONSOB Regulation pursuant toArt. 6, paragraph 2-bis of the Consolidated Finance Act, in line with Directive UCITS V and relevant ESMA Guidelines, is also guaranteedfor the asset management component of the Mediolanum Group within the time prescribed by law.

2 This Report, therefore, does not cover the remuneration policies of the insurance sector of the Mediolanum Financial Conglomerate, forwhich the sector regulations pursuant to ISVAP (today IVASS) Regulation no. 38/2018, which the subsidiary Insurance Companies arerequired to apply, without prejudice to the necessary alignment with the main principles defined by the Parent Company in theremuneration policies it has approved.

3 Total Assets calculated for prudential purposes pursuant to Bank of Italy Circular no. 285 of 17 December 2013 (EU Regulation575/2013)


The information will also be made available on the Company’s website (www.bancamediolanum.it) in thesection: “Corporate Governance”.

SECTION I

1 Roles and responsibilities of the bodies and parties involved in the process ofpreparing and implementing remuneration policies

The bodies and parties involved in preparing and approving remuneration policies are described in detailbelow, with their roles specified, in addition to the bodies or parties responsible for the correct implementationof this policy.

The corporate control functions of the Parent Company and the subsidiaries work together and exchange allimportant information in order to ensure adjustment to legislation and correct functioning of the remunerationpolicies.

1.1 Shareholders’ Meeting

In applying the current regulations of reference, in addition to what is already regulated by the by-laws, in orderto increase the degree of awareness and to monitor the total costs, benefits and risks of the remuneration andincentive system chosen, the Shareholders’ Meeting of Banca Mediolanum S.p.A.:

• resolves for or against the remuneration policies for the members of the bodies with strategic supervisory,management and control responsibilities and for the remaining personnel that the Board of Directors hasprepared. The resolution is binding, and the result of the vote is disclosed to the public;

• approves the financial instrument-based remuneration plans;

• may raise the limit of the ratio of the variable and fixed components of the personal remuneration of itspersonnel and allow the other banks in the Group to raise that limit for the personnel that work there underthe conditions and within the limits established by the current pro tempore primary and secondaryregulations4;

• approves the criteria for determining the remuneration to be agreed upon in the case of early terminationof employment or early termination of office, including the limits set for said remuneration, in compliancewith the legislation, also regulatory, in effect at the time;

• receives information on the evolution of the remuneration dynamics, also with regard to the sector trend;

• receives adequate information on implementation of the remuneration Policies with the aim of examiningthe actual methods for applying said policies, particularly regarding the variable components, and ofassessing consistency with the policies and the set goals.

1.2 Board of Directors

In its function of strategic supervision, the Board of Directors processes and reviews the remuneration Policiesof the Group with the support of the Remuneration Committee at least once a year, and is responsible for itsproper implementation.

It ensures that the remuneration Policies, including any financial instrument-based plans, are adequatelydocumented and:

• sends to the Shareholders’ Meeting for approval;

• accessible within the company structure, also concerning the consequences of any infringement ofregulations or codes of conduct or ethics.

After consulting with the Board of Statutory Auditors, it resolves on the distribution or calculation of theremunerations for the Directors holding special offices, depending on whether or not the Shareholders’ Meeting

4 See Art. 10 of the By-laws.


has included said remunerations in the total amount for the remuneration of the Directors5.

Please note that the executive Directors do not have proposal-making powers or do they take part in theresolutions concerning the decisions on their remuneration, as a conflict of interest might exist.

Having recourse to the Remuneration Committee and the responsible company functions:

• it approves the process of identifying the most significant personnel, the significance criteria adopted andthe list of roles considered “significant” as a consequence;

• it approves the outcomes of any exclusion procedure of the most significant personnel and periodicallyreviews the relative criteria;

• it defines, with its approval, the Group remuneration Policies, the remuneration and incentive systems ofthe personnel identified as most significant, also considering proposal-making powers assigned to theChief Executive Officer, and of the managers and personnel of highest level of the corporate controlfunctions, particularly of the following parties:

- directors with executive offices;

- general managers;

- managers of the organisational first line;

- those who directly report to the Board of Directors, the Chief Executive Office and the GeneralManager;

- managers and personnel of the highest level of the corporate control functions (Compliance, Anti-money Laundering, Risk Management and Internal Audit);

• ensures that the responsible corporate functions (particularly Human Resources, Sales NetworkAdministration, Commercial Planning, Career and Network Tools, Planning and Control, Compliance, Anti-money Laundering, Risk Management and Internal Audit) are involved in the process of definingremuneration policies with procedures such as to preserve the judgement autonomy of the functionsrequired to perform controls, also ex post;

• with particular reference to the corporate functions with control duties, it also avails itself of the opinion ofthe Board of Statutory Auditors for its assessments not connected with economic parameters regardingthe functionality of the overall internal controls system;

• if the Shareholders’ Meeting has not already done so, it sets the remuneration of the Chairman of theBoard of Directors, any Directors assigned special offices and the Chief Executive Officer;

• receives proposals from the Remuneration Committee regarding the remuneration and the remunerationand incentive systems of the members of bodies with strategic supervision and management function ofthe foreign banking companies of the Group also in relation to the economic results achieved and theachievement of specific objectives, monitoring their application;

• it implements and updates the financial instrument-based incentive systems, including identification of therecipients, determination of the amount of financial instruments due to each one of them, identification ofthe Group performance indicators, and the carrying out of every action, fulfilment, formality andcommunication necessary or expedient for the management and/or implementation of the financialinstrument-based incentive systems, including the relevant implementation regulations;

• ensures implementation of the remuneration and incentive policies by availing itself of the Chief ExecutiveOfficer and General Manager;

• is informed on the attainment of the objectives set for paying the variable remuneration tied to economicparameters and to the functioning of the risk correction and deferment mechanisms adopted, withparticular reference to the “most significant personnel”;

• checks that the remuneration Policies are consistent with the healthy and prudent management and long-term strategies of the Company and Group as a whole to ensure that the incentive systems are adequatelycorrect to guarantee the following of the legal, regulatory and by-law provisions as well as any codes ofethics or conduct, fostering adoption of compliant behaviour;

• assesses and approves any proposals to change the process of identifying the most significant personnel,



the significance criteria adopted and the list of corporate roles that, as a result, are considered “moresignificant” and remuneration and incentive policies prepared to submit to the approval of theShareholders’ Meeting and consequent implementation regulations;

• approves the report prepared for the Shareholders’ Meeting regarding implementation of the remunerationPolicies for all corporate roles.

1.3 Remuneration committee

The Remuneration Committee has the power to provide proposals, consultancy and instructions, expressedin the formulation of proposals, recommendations and opinions with the aim of allowing the Board of Directorsto adopt its own decisions with greater knowledge of facts.

Furthermore, it prepares its own budget for fulfilment of its duties that is previously approved by the Board ofDirectors with the help of internal and external consultants. In any case, the Remuneration Committee hasaccess to corporate information relevant for this purpose and has the financial resources to ensure itsoperational independence.

No Director takes part in the Remuneration Committee meetings during which proposals concerning theirremuneration are presented.

The Remuneration Committee:

• has the task of proposing remuneration for personnel whose remuneration and incentive systems aredetermined by the Board of Directors, as well as establishing the performance objectives related to thevariable component of said remuneration;

• has advisory tasks regarding determination of the criteria for the remuneration of all key personnel;

• submits proposals to the Board of Directors, and monitors application of the decisions taken, regardingremuneration, and more generally for the remuneration and incentive system of the members of bodieswith strategic supervision and management function of the foreign banking companies of the Group alsoin relation to the economic results achieved and the achievement of specific objectives;

• with reference to the above points, provides consulting on:

- the process adopted to draw up remuneration policies;

- identification of the most significant personnel;

• also availing of the information received from the responsible corporate functions, expresses an opinionon the outcomes of the most significant personnel identification process, including any exclusions;

• supports the Board of Directors in the verification of the overall consistency, adequacy and actualapplication of the Group remuneration policies approved by the General Meeting with respect to soundand prudent management and long-term strategies of the Group; in this regard:

- submits proposals to the Board of Directors on the matter;

- monitors the application of the decisions adopted by the Board of Directors on the remuneration of theChairman, Vice Chairmen, the CEO, the Directors holding special offices, the General Manager and,more generally of the “most significant personnel”; to that end, receives the appropriate informationfrom the responsible company functions;

- in connection with the point above, directly supervises the correct application of the rules on theremuneration of the internal control function managers, in close collaboration with the Board ofAuditors;

• reports on the activity carried out, prepares communications and submits proposals and reasoned opinionsto the Board of Directors in enough time to prepare the board meetings called to discuss the question ofremunerations;

• collaborates with the other committees within the Board of Directors and especially with the RiskCommittee that ascertains that the incentives underlying the remuneration and incentive system areconsistent with the RAF;

• ensures the involvement of the following responsible corporate functions in the process of drawing up andcontrolling remuneration and incentive policies and practices: Human Resources, Commercial Planning,Career and Network Tools, Management Planning and Control, Compliance Function, Risk Management


and Internal Audit Function;

• provides an opinion, making use of the information received by the competent company functions, on theachievement of performance objectives which are linked to the incentive plans and on the ascertainmentof other conditions for the payment of remuneration;

• provides appropriate feedback on the activities carried out to the corporate bodies, including the GeneralMeeting of Shareholders.

With reference to Mediolanum Gestione Fondi SGR p.a., it carries out functions concerning the remunerationpolicies and the incentive systems of the subsidiary and in particular:

- formally re-examines a number of possibilities for checking how the remuneration system will reactto future external and internal events, and also subjects it to retrospective testing;

- checks the alignment of the remuneration and incentive system with the strategy, risks andinterests of the operator and of the UCITSs and IIFs managed;

- ensures the involvement of the relevant governance bodies/company functions, in line with whathas been established consistent with the sector legislation in effect at the time.

1.4 Chief Executive Officer

As part of the powers assigned to him, the Chief Executive Officer6:

• orders that the remuneration and incentive system be conformed based on the remuneration policiesapproved by the Board of Directors (and by the Shareholders’ Meeting) and communicates these policiesto the Administrative Bodies of the Group Companies;

• has proposal-making powers regarding the Group remuneration Policies;

• as part of preparation of the draft financial statements, receives specific information pertaining to the belowfrom the Human Resources function and from the structures entrusted to the supervision also of the ChiefFinancial Officer (in particular Administration and Financial Statements and Planning and Control):

- the application status of the remuneration and incentive policies (including implementation of anyfinancial instrument-based remuneration plans) for the various corporate roles, including SalesNetwork, summarising the resolved remunerations and rights accrued by the recipients of theaforesaid policies;

- the results of the surveys on the evolution of the remuneration dynamics and on the Company’spositioning as compared to the market of reference;

- the controls carried out on implementation of the remuneration policies;

- any proposals to amend these policies.

With reference to the last point, sends specific summarised information to the Board of Directors and to theremuneration Committee.

The Chief Executive Officer also has proposal-making powers regarding:

• the company parties to bring back into the category “most significant personnel”;

• the remuneration and incentive systems of the “most significant personnel”, except for the personnelbelonging to company functions with control duties and, more generally speaking, company functions withduties potentially in conflict of interest with the powers of the Chief Executive Officer and General Manager.

Please note that the Chief Executive Officer does not have proposal-making powers or does he take part in

the resolutions concerning the decisions on his own remuneration, as a conflict of interest might exist.

1.5 Human Resources

One of the responsibilities of the Human Resources function is to define remuneration and incentive policies



supporting responsible company bodies and functions.

The Human Resources functions works with the Bodies and the responsible company functions in definingremuneration Policies after first analysing the legislation of reference, studying trends and market practices onthe subject, and examining applied national collective bargaining agreements and existing supplementaryinternal agreements that have been negotiated with the Trade Union Organisations.

Furthermore, also with the possible support of the responsible company functions:

• submits the variable remuneration structure to the responsible Bodies, with particular reference to themechanisms applied to the “most significant personnel”;

• performs analyses on the evolution of the remuneration dynamics and on the Company’s positioning ascompared to the market of reference;

• checks the application status of the remuneration Policies;

• provide its support to the compliance function, ensuring consistency with the policies and human resourcesmanagement procedures and the bank’s remuneration and incentive systems;

• in observance of the guidelines issued internally, deals with the technical aspects tied to the formulationand application of the financial instrument-based plans;

• submits amendments of the remuneration Policies following any internal organisational and/or regulatoryframework of reference changes to the responsible Bodies and verifies any impact they may have;

• proposes the rules underlying the organisation and functioning of the “most significant personnel”identification process with reference to the Employees and the Directors; to this regard, he assesses thesignificance of the MRTs Personnel, also in agreement with the Sales Network Administration function,and submits the list of roles identified as “most significant personnel” to the remuneration Committee.

1.6 Sales Network Administration

The Sales Network Administration function collaborates with the Bodies and responsible company functionsin defining remuneration and incentive policies of the sales network after first analysing the legislation ofreference, and studying trends and market practices on the subject.

Furthermore, also with the possible support of the responsible company functions (and in particular with theCompliance function) as far as the regulatory aspects are concerned):

• performs analyses on the evolution of the remuneration dynamics and on the Company’s positioning ascompared to the market of reference;

• checks the application status of the remuneration and incentive policies;

• in observance of the guidelines issued internally, deals with the technical aspects tied to the formulationand application of the financial instrument-based plans;

• checks the impact deriving from a possible update of the remuneration and incentive policies on theexisting remuneration system, and points out any problems in applying new policies.

1.7 Commercial Policies, Career and Network Tools

The Commercial Planning, Career and Network Tools Division defines career development and managementpolicies of the Sales Network and relevant remuneration model compared to the reference market incompliance with the regulations and legislation. In this area it develops a system for measuring theperformance of the Family Banker on the basis of quantitative and qualitative parameters.

For this purpose the Commercial Planning, Career and Network Tools Division:

• in agreement with the Sales Network Administration function, submits the structure of the non-recurringcomponent to the responsible Bodies, with particular reference to the mechanisms applied to the “mostsignificant personnel”; to this regard:

- identifies the performance indicators and correction mechanisms for risk both ex ante and ex postagainst which to parameter and adjusts the variable component in the final balance, if required;

- identifies the solutions for balancing remunerations based on financial instruments (or equivalent


instruments) and the remunerations paid in cash;

- also considering the previous points, it identifies the applicable deferred payment systems;

• defines the remuneration and career model of the Sales Network in agreement with the Chief FinancialOfficer;

• submits the amendments to the policies following any organisational changes of the Sales NetworkPersonnel and/or of the regulatory context of reference;

• proposes the rules underlying the organisation and functioning of the “most significant personnel”identification process for the sales network structures; to this regard, it assesses the significance of theMRT personnel also in agreement with the Human Resources function and submits to the assessment ofthe Remuneration Committee:

- the assessment methodology used (categories and roles included in the analysis, areas ofsignificance, classification criteria, scales of assessment and overall assessment logics);

- the list for identifying the “most significant personnel” on the basis of the results of the significanceassessment conducted on them;

• defines the Sales Network assessment model while adopting/keeping a commercial rating, syntheticindicator of monitoring the quality of the processes and of the Family Banker activities, coordinating withthe other company functions and in particular with the Compliance Function and the Sales NetworkAdministration Sector;

• defines the rewarding model and the hierarchies at the basis of the Sales Network incentive system;

• is the contact inside the Sales Department in the area of inter-functional projects having an impact on theSales Network remuneration system.

1.8 Planning and Control

The division in question contributes to the definition of the remuneration Policies and, upon the request of theBodies and responsible company functions, provides data and information helpful for determining objectivesto assign to the company figures for which a part of the variable remuneration tied to the expected results isplanned, and for checking the results they have achieved.

1.9 Risk Management

The Function in question contributes to the definition of the remuneration and incentive policies and putsforward opinions on the adoption of adequate performance measurement indicators, able to reflect theCompany’s profitability over time and to take into account current and future risks of the cost of capital andliquidity necessary to cope with the activities undertaken.

If necessary, it also takes part in identifying the most significant personnel, in collaboration with the otherresponsible company functions.

To this regard, the Manager of the Risk Management function attends, upon invitation, the remunerationCommittee meetings to ensure that the incentive systems are adequately correct to taken into account all therisks taken by the Bank according to methodologies consistent with those that the Bank adopts for managingrisks for regulatory and internal purposes.

1.10 Compliance

The structure in question assesses the adequacy and compliance of the policies and remuneration practicesadopted with legislation in effect at the time and their correct functioning.

It takes part in defining incentive systems on the topics it is responsible for by way of support to the otherfunctions involved.

It particularly carries out the following ex ante control activities:

• it checks compliance of the remuneration and incentive policies against the internal and external regulatoryframework;


• it checks that the content of the report to the Shareholders’ Meeting and to the public meet the regulatorySupervisory requirements;

• it checks the proper regulatory definition of the criteria for identifying the most significant personnel, incollaboration with the other responsible company functions.

It checks, ex post, that application of the remuneration policies complies with the regulations, also by randomchecks on proper implementation of the relevant principles.

Carry out spot checks on the internal custody and administration accounts at least of the most significantpersonnel to:

• ensure compliance with the prohibition to receive remuneration or benefit through tools or means thatelude the current regulations on remuneration;

• identify cases when the personnel availed of personal hedging or insurance strategies onremuneration that might alter or invalidate the risk alignment effects inherent in their remunerationsystems.

The evidence found and any anomalies are brought to the knowledge of the remuneration Committee, theBoard of Directors and the Board of Statutory Auditors for adoption of any necessary corrective measures.

1.11 Internal Audit

The Internal Audit function periodically checks the methods through which it is insured that the remunerationpractices comply with the regulatory context inside the Company. It particularly checks that the remunerationpractices comply with the approved policies and with the regulations in effect at the time at least on an annualbasis, with particular reference to the following aspects:

• implementation of the process for identifying and updating the list of the “most significant personnel”;

• observance of the authorisation procedure for approval of the remuneration policies;

• observance of the rules and procedures set out in the remuneration policies approved by the Shareholders’Meeting, with particular attention to the “most significant personnel”;

• observance of the pension and termination policy provided for in the Group remuneration policies and,with specific reference to the Sales Network, of the Additional Benefits and Bonuses Regulation.

The evidence found, with any anomalies recorded specified, is brought to the knowledge of the Bodies andresponsible company functions so they can carry out any necessary improvement actions and, following asignificance assessment and where explicitly provided for, so they can prepare adequate information to sendto the European Central Bank or to the Bank of Italy. The results of the check conducted are brought to theknowledge of the Shareholders’ Meeting once a year.

2 Identification of the Most Significant Personnel

In compliance with the applicable current regulatory provisions, the Company conducts the evaluation processmeant to identify the “Most Significant Personnel” (also MRTs), That is, the category of individuals whose jobactivity has or can have a big impact on the Group’s risk profile.

To identify the most significant personnel, Mediolanum Banking Group applies the Delegated Regulation (EU)of March 4, 2014 no. 604 (Regulatory Technical Standards, Criteria to identify categories of staff whoseprofessional activities have a material impact on an institution’s risk profile of EBA).

The process establishes the criteria and procedures used to identify the most significant personnel, the meansof personnel evaluation, the role carried out by the bodies and company functions responsible for theprocessing, monitoring, and review of the identification process.

The parent company Banca Mediolanum S.p.A. applies the cited regulations considering all group companies,whether they are the target audience of the roles on an individual basis or not, ensuring overall consistencywith the identification process for the entire Group, as well as coordination between the provisions and otherrules that may be applicable to each company, also based on respective sector.

To implement the CRDIV, the identification process is carried out by all the banks belonging to MediolanumBanking Group on an individual basis at least once a year.


The outcomes of the most significant personnel identification process are properly justified and made official.

2.1 Personnel recognition and analysis

By Personnel we mean the members of the bodies with a strategic supervisory function, management andcontrol, employees and collaborators of the banking group. The Parent Company avails of the relevantcorporate functions, Career Compensation, Dale Network Administration, and Human Resources to gather theinformation needed for the process.

The Group companies contribute actively, providing the data and information helpful in the identificationprocess based on that required by the parent company.

The Risk Management function participates in the process providing instructions on identification of andassignment of value to the risk indicators under the Delegated Regulation (for example for identification of theso-called Material Business Unit) in order to consider the actual ability of the individual corporate figures toaffect the Group’s risk profile.

In cooperation with the Compliance, Organization, and Corporate Affairs functions, when necessary, theorganisational and size information is gathered and analysed, like: organisational structure, officialiseddelegated powers, etc.

Scope of Relevance Information sources

Powers delegated

Powers delegated

*Company Files*

Corporate Governance Plan

Responsibilities and

Assignments

Service Structure

Organisational Chart

Committees’ Regulation

*Operational Service Manager* of the individual

companies

Material Business Unit Consolidated regulatory capital requirements

Characteristics of the

remuneration

Policies, regulation, and data concerning remuneration

and incentives

Specifically, for the purposes of carrying out this process an operational/methodological approach is adoptedcharacterised by evaluation of each of the criteria under the Delegated Regulation with regard both to thequalitative and quantitative criteria.

The analysis is conducted at least once a year considering Directors and Employed Personnel and separately,Collaborators in the Sales Network.

2.2 Outcomes and Relative Formalisation

The relevant corporate functions submit the outcomes of the process of most significant personnelidentification to the Remuneration Committee which gives an opinion on the roles identified with reference toeach of the criteria considered based on the Delegated Regulation.

Specifically, the Remuneration Committee is submitted specific documentation that gives the roles identifiedin order to evaluate their respective responsibilities, and the lists of names of the individuals with those officesand roles.

The outcomes also highlight:

• the number of personnel identified as most significant,• the number of individuals identified for the first time,• Comparison with the outcomes of the process recorded last year.

The outcomes of the process and the related remarks formulated by the Remuneration Committee aresubmitted to the Board of Directors.


The main information on the process of most significant personal identification and the related outcomesconstitute an integral part of the Remuneration Policy and as such are submitted to the Shareholders’ Meetingfor approval.

With regard to this year’s identification process, 92 individual were classified as most significant personnel, 53of which were directors and employees of the Group and 39 of which collaborators belonging to the salesnetwork. Compared to 2018 the number is seven units higher. The number of individuals identified as mostsignificant personnel does not include those that will be receiving an exclusion notice.

2.3 Exclusion

In the process of identifying the most significant personnel, particular emphasis is placed on the roles andindividuals identified based on quantitative criteria and in particular that set forth in paragraphs 2 and asamended and article 4 paragraph one of the Delegated Regulation.

If, considering the total remuneration earned the previous financial year, individuals not classified as significantbased on the qualitative criteria are identified as most significant personnel, they undergo additional carefulanalysis to evaluate their actual ability to take on significant risk for the Group, and thus, possible exclusion.

This analysis is conducted by the relevant corporate functions (Human Resources, Organisation, CareerCompensation, and the Sales Network Administration) based on the evaluations and considerations providedby the Group control functions, Compliance and Risk Management in particular, also concerning how muchone exceeds different pay thresholds set by regulations.

The relevant functions submit any exclusion proposals of the specific roles/individuals to get the opinion of theRemuneration Committee and then the proposals are brought to the attention of the Board of Directors forapproval.

The Shareholders’ Meeting is made aware of any exclusions through the remuneration policies.

If exclusions are approved they are communicated to the supervisory authority, or the Group’s RiskManagement function requests authorisation for them according to the means and time frames laid forth bythe relative rules.

Concerning the process conducted this year, 38 collaborators were identified, 37 of which belong to the salesnetwork for which, having done the proper analyses regarding the role covered and substantial evidence ofthe absence of a major impact on the Group’s risk profile, the relative exclusion notice is sent to the supervisoryauthority.

3 Reasons and aims pursued with the remuneration policies

The remuneration Policies defined by Banca Mediolanum S.p.A. pursue the objective of attracting and retainingparties having professionalism and capabilities adequate for the company’s needs and that of providing anincentive aimed at increasing commitment to improving company performance through satisfaction andpersonal motivation.

Furthermore, application of the remuneration policies ensures better alignment between their recipients andthe Shareholders of Banca Mediolanum S.p.A. and of the Group, in both the short-term perspective bymaximising the creation of value for the Shareholders and in the medium-/long-term perspective by carefullymanaging corporate risks and pursuing medium-/long-term strategies.

To this regard, the remuneration and incentive criteria based on objective parameters tied to performance andin line with the strategic medium-/long-term objectives represent the tool capable of stimulating thecommitment of all parties to the greatest extent and, as a result, best meeting the Group's interests.

4 Using Benchmarks for Directors and Employees

In order to adopt effective remuneration practices that can appropriately support the business and resourcemanagement strategies, continuous monitoring of the general market trends for proper definition of competitiveremuneration levels and to guarantee internal impartiality and transparency is applied.

Participation in remuneration benchmarks referring to specific panels of companies operating in one or moremarkets of reference and corresponding to figures that hold similar roles and position allows the remunerationpositioning with regard to fixed, variable and total remuneration to be recorded.


These are the reasons why the responsible functions ensure participation in remuneration surveys and studiesconducted by the key international and sector players.

5 Remuneration structure of the Directors, Statutory Auditors and Employees

The remuneration structure adopted with reference to personnel entails a fixed remuneration, which rewardsthe role held and the breadth of responsibilities, reflecting experience and capabilities required for eachposition and the level of excellence demonstrated and the overall quality of the contribution to the business’results, and possible a variable remuneration that aims at recognising the results attained by establishing adirect connection between the remunerations and the actual results of the Company and of the individual overthe short- and medium-term, in observance of the defined risk profile. In compliance with current legislation,any other components of the remuneration package, like for example non enticement covenants, agreementsto extend prior notice and severances, are also included in the variable remuneration category.

5.1 Fixed remuneration

The significance of the weight of the fixed remuneration is contemplated inside the total package, in line withthe level of competitiveness sought compared to the market and in such a way as to reduce the possibility ofconduct that is excessively risk-oriented, to discourage initiatives focused on the short-term results that mightjeopardise sustainability and the creation of medium- and long-term value.

Fixed remuneration is also structured to such an extent as to allow the variable portion to considerably shrinkor be eliminated in connection with the correct results for the risks actually attained.

To this regard, the remuneration policies state that the remunerations awarded by the Shareholders’ Meetingto the Directors when they are appointed and to the Statutory Auditors are to be proportionate to theresponsibilities, duties, degree of the individual’s attendance of the meetings of their board, with theundertaking of all the consequent responsibilities and with the be market practices. The use of theseparameters allows adequate grounds and transparency to be given to the remuneration awarded.

In particular:

• the remuneration due to the Directors when they are appointed and that to be paid to the members of theBoard of Statutory Auditors is resolved by the Shareholders’ meeting (with right to also determine theremuneration for directors invested with special offices, if any);

• the remuneration for the Chairman, Vice Chairmen and Directors, if any, invested with special offices isdetermined by the Board of Directors (if this right is not exercised by the Shareholders’ Meeting); the sameholds true with reference to the total remuneration of the Chief Executive Officer;

• the provisions of the collective agreements of reference and of any supplementary company agreements,as well as of the remuneration and incentive system - which considers the organisational weight of thepositions held by employees with reference to the situation of the market of reference and of the budgetavailable for the period - applies to Employees;

• for the Collaborators not bound to the Company by employment, the provisions of the respectiveconsultancy, project work and collaboration agreements apply in observance of the system of internalmandates.

With reference to the last point, the consideration that remunerates said agreements is determined inproportion to the benefits that the Company gains from the work of whoever is supplying their collaboration. Ifthe agreement covers the supply of an intellectual and organisational support activity, it is necessary to takeinto account remuneration levels that the market of reference offers, also in connection with the qualitativemerit of the supply inferred in the agreements, and the professionalism of the collaborator.

Where, on the other hand, the purpose of the relationship is to promote business and sell products, theremuneration is determined on the basis of special commissions tables, in consideration of the best practicesadopted by the market and in compliance with current legislation.

5.2 Ratio between fixed and variable remuneration

Art. 10 of the By-laws of Banca Mediolanum acknowledges that the Ordinary Shareholders’ Meeting has the


right to raise the limit of the ratio between the variable and fixed components of the individual remuneration.

Starting from 2015, the Company decided to avail itself of the possibility to extend the ratio between thevariable and fixed components of the individual remuneration up to a maximum of 2:1 for several specificcategories of parties considered “most significant personnel”, and in particular for: the managers of thebusiness units, the general managers, the sales managers, the executive directors (i.e. chief executiveofficers), the managers and key resources working in Asset Management, Investment Banking and in thedevelopment of the new businesses of the Mediolanum Group companies, to be identified each time based ontheir specific responsibilities, strategic nature and prevailing market practices regarding specific roles and themeasurability of the performance to which the variable component of the remuneration is tied (at present, amaximum theoretical total of 13 people holding roles falling under the categories indicated is considered).However it still hold that for the most significant personnel working at the Group banks, the shareholders’meeting responsible for passing resolution on whether to set a limit higher than 1:1 is that of the bank wherethe personnel affected by the decision works.

The Company also avails of the right to exclude the personnel belonging to the Group’s asset managementcompanies from the above-mentioned limit in order to maintain its ability to compete in conditions of faircompetition on the job market for specific professional figures, which according to established industrypractices are paid – both in Italy and abroad – with higher levels of the variable component.

Any sums to be paid in the form of discretionary pension benefits or in view of, or upon, early termination ofemployment or early termination of office also fall within the limit to the variable/fixed ratio, except for sumsagreed upon and paid: i) based on a non-enticement covenant, for the part that – for each year the agreementlasts – does not exceed the last annuity of fixed remuneration; ii) in the scope of an agreement between thebank and the personnel, reached anywhere, to settle an actual or potential dispute, if calculated based on thepre-set formula.

For the remaining portion of the most significant personnel in question, a ratio up to 1:1 between the fixed andvariable remuneration is adopted, except for the corporate functions with control duties, in compliance with theSupervisory Provisions, for which the variable remuneration cannot be greater than 33% of the fixedremuneration. For the executive responsible for financial reporting, for the rest of the personnel of the corporatefunctions of control and of the Human Resources function, if there is a variable component in any event it issmall.

5.3 Purpose of the variable remuneration

Starting from 2015, the Group has revised the incentive systems according to the principles contained in theremuneration policies, and introduced two new incentive plans for the most significant personnel (TopManagement and Collaborators) that provide for adequate deferment and retention mechanisms.

General objectives of the incentive plans are:

• align the recipients objectives with those of the company of sustainable growth in business in observanceof the defined RAF;

• have a pay mix that is aligned with the best market practices in terms of total remuneration level andcomposition and keeps the motivation of the recipients is high and is reasonably attractive;

• have a remuneration element that allows a cost component to be related to the creation of value by theGroup;

• disburse the variable remuneration of the recipients upon attainment:

- of pre-defined corporate objectives;

- of the expected individual performance levels;

• being compliant with the regulatory provisions previously mentioned, with particular reference to the“Material Risk Takers”.

Based on the supervisory regulations, Banca Mediolanum S.p.A. applies the principle of proportionality as it ispositioned in the intermediate banks category, in line with the provisions of the Bank of Italy, and for the mostsignificant personnel provides for percentages and periods of deferment and retention lower than but close tothose required for the larger banks.


Please note that the Group policies defined herein by Banca Mediolanum are also implemented by the foreignsubsidiaries, in observance of the limits applicable to them by the regulations of the sector of their respectivecountries where they are stricter than the Italian ones. Furthermore, for the subsidiaries operating in the assetmanagement sector the remuneration and incentive policy they have defined is applied in line with the Groupguidelines and in observance of the sector regulations in effect at the time.

The Company has also implemented for the Managers (i.e. Managerial Staff) and Supervisors of the Group inItaly a short-term incentive plan called “Variable Compensation Plan” (VCP), defined in line with the principlesand polices regarding the remuneration and incentive systems established and formalised in the Groupremuneration policies, which sets out to pay a bonus based on individual performance and attainment of certainMediolanum Group results to the plan participants. The plan is annual and can be reproposed, amended oreven cancelled from one year to the next.

All the incentives systems are designed to foster the following of all the legal, regulatory and by-law provisionsas well as any codes of ethics or conduct.

5.4 Variable remuneration of the members of the bodies having a strategicsupervision and control function

Disbursement of any type of variable remuneration for the office held is not planned for the non-executivemembers of the Board of Directors and the members of the Board of Statutory Auditors.

5.5 Variable remuneration of the Most Significant Personnel and of theremaining employees

The incentive system requires that each year the indicators and their goal values at the company and individuallevels be defined for the current year after the accounting of the previous year and the company and functionbudgets have been defined.

Only assessments not tied to economic-financial parameters are used for the control roles. As required by theregulations, the same gates used for the rest of the company population apply to them.

In compliance with the Supervisory Provisions, the participants in the incentive plan undertake to not availthemselves of personal hedging or insurance strategies on remuneration or other aspects that might alter orinvalidate the risk alignment effects inherent in their remuneration mechanisms, with particular reference tothe incentive systems.

For the same reasons, the types of transactions and financial investments directly or indirectly made by themost significant personnel that could have an effect on risk alignment mechanisms are identified. For thispurpose and particularly for the most significant personnel, adequate procedures and checks are scheduled,conducted by corporate control functions or by the Human Resources function on the internal custody andadministration accounts and the procedures and intervals that the most significant personnel are required tocommunicate the transactions and financial investments made (which fall under the types identified inadvance) are established. If initiatives geared toward bank personnel or another group company call fortransactions and financial investments that fall under the types identified, the remuneration policies mustprovide adequate information on them.

Since 2015 the Group has implemented an incentive plan for the most significant personnel called “TopManagement” plan in order to ensure compliance of the incentive systems with the regulatory framework ofreference.

The goals that the plan pursue are:

- the promotion of the Top Management’s engagement in the interests of the shareholders to create value;

- alignment of the market practices of reference;

- observance of the provisions;

- retention of the resources who are Plan recipients.

The new variable remuneration plan is addressed to the “Top Management - Most Significant Personnel”,Directors/Executives who accrue incentives over the significance threshold of Euro 75,000 during the year.

Except for several differences in disbursement for the categories of personnel who are plan recipients (see


Section II), the new system assigns a short-term incentive, part of which is up front and another part deferred,paid in cash and in financial instruments.

In applying the proportionality criterion described in Section I under paragraph 7, measure of the Bank of Italy“Supervisory provisions for the banks, circular no. 285 of 17 December 2013, 25th update of 23 October 2018”,the percentages and the deferment and retention periods are equal to at least half those set by the aforesaidmeasure for the larger banks.

These indications were implemented with definition of the “Top Management” variable remuneration planaccording to which, for the most significant personnel whose accrued incentive component exceeds thesignificance threshold of Euro 75,000, payment of 50% in equity instruments and deferment for a quota of 40%of the total variable is set (as explained in greater detail in Section II).

If the accrued variable component is a particularly high sum, for the most and personnel (and especially forthe executive directors, the general managers and similar figures, the managers of the major lines of business,corporate functions or geographical areas, as well as those who report directly to the bodies with strategic,management and control supervision function) the share in equity instruments, that deferred, and the relativeperiod of deferment may be further increased based on that set by the supervisory regulations.

Based on the criteria set to determine values that are a particularly high amount of the variable component, a€430,000 threshold is set for the variable component accrued during the year.

Currently, none of the individuals that fill the roles mentioned has been given variable remuneration higherthan the threshold indicated.

If the incentives actually accrued should be equal to or lower than the significance threshold of Euro 75,000consistent with the national market practices, they may be disbursed entirely after the final accounting of theeconomic results of the year, provided the access thresholds are passed.

The variable remuneration plan is also addressed to the “Executive” personnel (whether significant under thethreshold or non-significant) according to specific procedures explained hereunder in Section II. The incentivesystem planned considers disbursement of the annual variable remuneration through attainment of theobjectives at Group level, according to a calculation scheme that considers the following parameters:

The indicators identified and their targets are defined in line with the Risk Appetite Framework (RAF) approvedby the Risk Committee. With reference to the year 2018, they are precisely provided in Section II underparagraph 4.1.

Moreover, disbursement of the variable remuneration may also be subject to attainment of individualperformance objectives whose assessment is determined based on the management appraisal process, whichrepresents the tool that the Group has adopted to manage and improve performance at managerial level,permitting the assessment and development of the managerial skills, the sharing and control of the objectivesand their degree of attainment.

The defined plans allow:

• incentives to be created for retention and commitment in the Group of the resources that decisivelycontribute to the success of the Company and of the Group;

• a significant component of the variable remuneration to be bound to attainment of certain performanceobjectives, both corporate and, when deemed necessary, individual, so as to align the interests of therecipients with the pursuit of the priority objective of creating value for the shareholders over a medium-/long-term time horizon;

• assistance in retaining the recipients by developing their sense of belonging to the Bank and to the Group.

Objectives at Group level

Pa

ram

ete

rs

Creation of valuecorrected for the risk

Capitalisation Liquidity Capital


5.6 Performance Objectives

The adopted system provides for economic parameters for the variable remuneration, and not as describedbelow.

5.6.1 Economic parameters

The parameters identified as objectives of the incentive plans must have specific peculiarities, or be easilyidentifiable, also with reference to the procurement sources and be objectively measurable.

As previously stated, the access gates of the incentive systems are built in such a way as to take intoconsideration:

• the creation of value corrected for the risk;

• the liquidity;

• the level of the capital;

• the financial soundness.

5.6.2 Non-economic parameters

With reference to the non-economic parameters, the variable remuneration is closely connected with anassessment that objectively considers the activity conducted by the company role (activities planned in theprevious year for the year of assessment, ordinary activities carried out by the structure, etc.) and qualitativelythe effectiveness and efficiency of the activity itself.

In particular, also considering the “Management Appraisal” system adopted by the Company, the short-termand medium-/long-term variable remunerations not linked to economic parameters due to the corporateexecutives, corporate function managers with control duties and, generally speaking, to the rest of theEmployees are - bearing in mind the role held - connected with the acquisition of skills, management of theresources, customer satisfaction and other qualitative components.

5.7 Treatment planned in the case of early termination of employment forthe Directors and Employees

In general, the pension and termination policy must be in line with corporate strategy and with the objectives,values and long-term interests of the Company.

In the case of early cancellation, dismissal or termination of employment with Banca Mediolanum S.p.A. orwith the Group, particular compensation for the personnel may be paid in exceptional and carefully assessedcases for achieved results.

In any case, and with reference to the “most significant personnel”, the compensation that might be granted atthe company’s discretion, except for what is due pursuant to law and defined by the current applicablecollective bargaining agreement (usually for subordinate employment) in the case of early conclusion ofemployment or of the mandate cannot exceed 2 (two) total annuities and in any case the maximum amount ofEuro five million. The actual amount must be established for every single case, taking into account the term ofoffice and of the employment, the strategic nature of the office held, performance and the risks assumed. Forregulatory purposes, said total annuities might equal a maximum theoretical amount comparable to four fixedannuities. This remuneration must also be subject to specific malus and clawback mechanisms.

Any payment of particular compensation in the case of early cancellation, dismissal or termination of theemployment must be made with the same methods, established at the time, for paying their variableremuneration, with particular reference to the deferment and retention periods and to the deferred portions andthose in instruments, not including the sums paid based on a non-enticement covenant, for the part that doesnot exceed the last annuity of fixed remuneration.

The remuneration for the most significant personnel agreed upon in these circumstances also falls under thecalculation of the limit to the variable/fixed ratio, except for the sums agreed upon and paid:

• based on a non-enticement covenant, for the part that – for each year the agreement lasts – does notexceed the last annuity of fixed remuneration,


• in the scope of an agreement between the bank and the personnel, reached anywhere, to settle anactual or potential dispute, if calculated based on the following rule set on the basis of the months paiddue to length of corporate service: up to 4 years of service: 14 months; over four and up to six yearsof service: 20 months; over six and up to 10 years of service: 22 months; over 10 and up to 15 yearsof service: 26 months; over 15 years of service: 30 months.

Lastly, it is pointed out that Banca Mediolanum today has no specific agreements in place with reference tocompensation in case of early dissolution of the employment or welfare or pension coverage other than themandatory.

5.8 Non-monetary benefits for Directors and Employees

The fixed remuneration components contain benefit/perquisite and corporate welfare packages withhomogeneous characteristics for those belonging to certain company populations (e.g. for executives andpredetermined brackets) that contribute to the making of an internal impartiality and market competitivenesssystem.

Generally speaking, special conditions in terms of access to banking and financial products offered by theGroup Companies might also be applied for employees, and systems supplementing institutional and welfaresocial security plans might be contemplated, such as those aimed at providing the same employees and theirfamilies guarantees for their health.

A liability insurance policy is also envisaged for the Directors and Executives in order to hold them harmlessfrom requests for compensation for unwilful conduct, with the same maximum for claim and for year.

Today the Group does not plan to use systems supplementing the social security plans on a discretionarybasis. Should they be introduced in the future, they will meet the specific requirements of the Regulator.

5.9 Other forms of remuneration

Any other remuneration elements not specifically regulated in the remuneration policies and that are notusual/recurring can in any case be adopted in special situations that are carefully assessed and for definedneeds, particularly in the case of recruiting and/or relocation, to increase - also temporarily - the level ofattractiveness of the proposed remuneration package, as pointed out in the market practices (e.g. entrybonuses, bonuses guaranteed for only the first year, allowances, specific benefits such as housing). Should itbe the case, they are however defined in observance of the Group policies and regulations, where applicable.

6 Remuneration structure of the Sales Network

The remuneration of the Sales Network is made up of different types of commission. It is therefore mostlyvariable and well-structured, also in consideration of the distinction between:

• Financial Advisors and Aspiring Financial Advisors dedicated solely to the sales activity (“banker”); as forthe latter, it is limited only to what is explicitly stated in the relevant contracts;

• Financial Advisors who in addition to the sales activity carry out supervision, coordination and developmentactivities for other Financial Advisors (“Supervisors and Managers”).

The remuneration structure adopted contains a recurring component that compensates the role held and theextent of the responsibilities, reflecting experience and capabilities required for each position and the level ofexcellence demonstrated and the overall quality of the contribution to the business results, and possibly anincentive component that is non-recurring and that aims at acknowledging the results attained, establishinga direct connection between the remunerations and the actual short- and medium-term results of the Companyand of the individual in observance of the defined risk profile.

In observance of the applicable regulatory provisions, and in compliance with the provisions of Art. 10 of theBy-laws and in compliance with the resolutions of the Shareholders’ Meeting of Mediolanum S.p.A. of 26 March2015 for the “most significant personnel” who are part of the Sales Network, the adoption of a maximum ratiobetween fixed and variable remuneration up to 2:1 is not modified (a maximum theoretical total of 39 peopleidentified as most significant personnel is considered at present).

The non-recurring component for the Financial advisors identified as “most significant personnel” consists ofa short-term variable remuneration on an annual basis, of which part is paid up front and part is deferred,


whether in cash or in instruments, in line with the applicable regulatory framework. Based on the supervisoryregulations, in 2015 Banca Mediolanum S.p.A. applied the principle of proportionality, in line with the provisionsof the Bank of Italy, or considering itself an intermediate bank, it provides for percentages and periods ofdeferment and retention lower than but close to those required for the larger banks for the most significantpersonnel.

For the Financial Advisors not identified as “most significant personnel”, any non-recurring component consistsof a short-term variable remuneration on an annual basis, determined ex ante - according to objective criteria- and corrected ex post, taking into account operational risk indicators such as to promote honest conduct andconnection with the legal and reputation risks that might affect the bank, and suitable for facilitating compliancewith the rules and the protection and retention of customers.

Payment of the non-recurring component of all Financial Advisors is entirely or partially tied to the priorfulfilment of the equity and liquidity conditions of the bank and of the Group.

The distinction between “recurring” and “non-recurring” components of the remuneration, the operational riskindicators to which the “non-recurring” component is anchored (also in view of the ex post correction for therisks), the conditions for accessing the “non-recurring” remuneration and the other essential characteristics ofthe remuneration systems are adequately formalised and documented as required by Circular 285/2013.Without prejudice to what is provided for in this section, the rules established for all personnel, includingalignment with the policies of prudent bank risk management and the prohibition to not use personal hedgingor remuneration insurance policies, apply to all Financial Advisors.

6.1 Collaborators Plan

The Shareholders’ Meeting of Banca Mediolanum S.p.A. resolved approval of the incentive plan for the SalesNetwork Personnel in order to ensure that the incentive systems comply with the regulatory framework ofreference.

The goals that pursued through the plan are:

- the promotion of the Sales Network's engagement in the interests of the shareholders to create value;

- alignment of the market practices of reference;

- observance of the provisions;

- retention of the resources who are Plan recipients.

The new variable remuneration plan is addressed to the “Collaborators - most significant personnel” and isalso addressed to the managers of the “non-significant” Network according to the procedures explained inSection II below.

With reference to the significant personnel of the Sales Network (see Section II), the new system assigns ashort-term incentive, part of which is up front and another part deferred, paid in cash and in financialinstruments.

These indications were implemented during 2015 with definition of the “Collaborators” variable remunerationplan according to which, for the most significant personnel whose accrued incentive component exceeds thesignificance threshold of €25,000, payment of 50% in equity instruments and deferment for a quota of 40% ofthe total variable is set (as explained in greater detail in Section II).

In applying the proportionality criterion described in Section I under paragraph 7, measure of the Bank of Italy“Supervisory provisions for the banks, circular no. 285 of 17 December 2013, 25th update of 23 October 2018”,the percentages and the deferment and retention periods must be equal to at least half those set by theaforesaid measure for the larger banks. .

The incentive system planned considers disbursement of the annual variable remuneration through attainmentof the objectives at Group level, according to a calculation scheme that considers the following parameters:

• capitalisation;

• liquidity;

• the level of the capital.


The defined plans allow:

• incentives to be created for retention and commitment in the Group of the resources that decisivelycontribute to the success of the Company and of the Group;

• a significant portion of the non-recurring component to be bound to attainment of certain performanceobjectives, both corporate and, when deemed necessary, individual, so as to align the interests of therecipients with the pursuit of the priority objective of creating value for the shareholders over a medium-/long-term time horizon;

• assistance in retaining the recipients by developing their sense of belonging to the Bank and to the Group.

6.1.1 Performance Objectives

The adopted system requires that objectives be reached on both the company and the personal level for thenon-recurring component.

The indicators identified and their targets are defined in line with the Risk Appetite Framework (RAF) approvedby the Risk Committee.

Based on the remuneration structure applied, information on the following is provided in Section II:

• threshold values (access gate);

• individual quantitative objectives;

• individual qualitative objectives.

6.2 Treatment planned in the case of termination of the agency agreement orreduction of the assignment of supervision, assistance, andcoordination.

Regarding its financial advisor agent sales network, Banca Mediolanum S.p.A. has adopted the AdditionalBenefits and Bonuses Regulation that provides for payment, at the Bank’s full discretion, of specific benefits(“Portfolio Benefits”, “Structure Benefits” and “Manager Financial Advisor Benefits”) and plus other paymentsin the following instances:

(i) termination of the agency contract;

(ii) Bank’s decision to cut the structure of agents assigned to the agents (so-called Manager of Staff)

that carry out supervision, assistance, and coordination activities of several agent structures

regionally or nationally.

If the agency contract ends the Portfolio Benefits, Structure Benefits and/or Manager Financial Advisor Benefitscalculated according to the method defined in Annex one to this document are paid to the former agentaccording to the terms and conditions under the Additional Benefits and Bonuses Regulation. The above-mentioned benefits, when paid, will therefore be disbursed – as more detailed in the Additional Benefits andBonuses Regulation – against, inter alia, the former financial advisor agent’s entry into compliance with a non-enticement covenant lasting two years.

The bank may also decide to propose the former agent – if deemed of strategic interest – payment of a so-called “loyalty bonus” as well against their proven abstention from carrying out activities in conflict with and/orcompeting with those carried out by the Bank for a period to be defined following the expiration of the non-enticement covenant. The total amount that can be disbursed for the abovesaid benefits and for all otheragreements that may be reached in favour of the former financial advisor agent may not in any case exceedin total whichever is the lower sum of 5 (five) annuities of the last recurring remuneration and Euro ten million.Without prejudice to the fact that the sums paid to the most significant personnel also falls under the calculationof the limit to the variable/fixed ratio, except for the sums agreed upon and paid:

(i) based on a non-enticement covenant, i.e., (maximum two years), for the part that – for each yearthe agreement lasts – does not exceed the last annuity of recurring remuneration,

(ii) in the scope of an agreement between the bank and the personnel, reached anywhere, to settlean actual or potential dispute, if calculated based on the rules under this paragraph and in Annexone to this document


Specifically in reference to the agent’s stopping just the activity of Manager of Staff – as a consequence of theBank’s cutting the agent structure entrusted to the former Manager of Staff – the Bank, when deemed to be ofparticular strategic/business interest and also in order to guarantee continuance of the agency contract withthe Financial Advisor, within the scope of the novation of the related contract, shall have the right to pay theagent the Manager Financial Advisor Benefits, applying a higher coefficient of calculation compared to that setforth in Annex 1 of these policies, without prejudice to all the other terms and conditions in the AdditionalBonuses Regulation up to a maximum coefficient of 60. In this case, the sum of the Manager Financial AdvisorBenefits may not in any case exceed in total whichever is the lower sum between 5 (five) annuities of the lastrecurring remuneration of the Manager and Euro ten million. This, without prejudice to the fact that the sumspaid to the most significant personnel also falls under the calculation of the limit to the variable/fixed ratio,except for the sums agreed upon and paid:

(i) based on a non-enticement covenant, i.e., (maximum two years), for the part that – for each yearthe agreement lasts – does not exceed the last annuity of recurring remuneration before thecovenant was entered into;

(ii) in the scope of an agreement between the bank and the personnel, reached anywhere, to settlean actual or potential dispute, if calculated based on the rules under this paragraph and in Annexone to this document7.

The applicable legal and regulatory provisions don’t hold, including the provisions under Part I, Title IV, Chapter2, Section III, par. 2.2.2 and 2.2.3 of Bank of Italy Circular no. 285/2013.

6.3 Conditions applied to products and services offered to the Sales Networkby the Bank

The same conditions on the products and services offered by the Bank that are normally applied to the bestcustomers apply to all Financial Advisors.

7 Assessment of sustainability relating to the own funds requirements

The current provisions on the subject of remuneration and incentive systems generally dictate specific criteriathat which the banks must follow in order to guarantee, among other things, that the system appropriatelytakes into account current and future risks of the degree of capitalisation and of the levels of liquidity of eachintermediary. In the interest of all the stakeholders, the objective is to arrive at remuneration systems in linewith the long-term corporate strategies and objectives connected with the corporate results, appropriatelycorrected to take into account all risks, consistent with the levels of capital and liquidity necessary to cope withthe activities undertaken.

With particular reference to the ratio between variable and fixed components of the remuneration, in relationto which - as stated in the forgoing paragraphs - the Bank availed itself of the right to raise this ratio beyondthe 1:1 level, but in any case within the maximum limit of 2:1, the regulations require that the intermediary carryout an assessment process of consistency and sustainability compared to the prudential regulations and, inparticular, to the own funds requirements.

This process was carried out taking into account both the remunerations of the employees and of thecollaborators (financial advisors) identifiable as “most significant personnel”.. More specifically, for the latterand owing to the specific nature of the remuneration assigned to them, which makes it by definition not exactlydeterminable ex ante, their potential impact on own funds was estimated both on the year under way and onthe two following years (2019-2021 three-year period), prudentially doubling the amount of the recurringremuneration paid in 2018..

When this process was completed and in consideration of both the limited number of “most significantpersonnel” potentially affected by the 2:1 ration and their remunerations, keeping, and potentially applying thehigher limit, does not jeopardise observance of the prudential regulations and, in particular, that regarding theown funds requirements in the 2019-2021 three-year period..

7 See note no. 7


8 Malus and Claw Back mechanisms for the Directors, Employees and SalesNetwork

The Group has implemented malus mechanisms based on which it will not liquidate the incentive remunerationin consideration of the performance net of the risks actually assumed or attained, the equity and liquiditysituation of the Group or of the single entity (so-called gate).

These mechanisms can also lead to even a significant reduction or elimination of the variable remunerationitself if performance results are significantly lower than the pre-set objectives.

With particular reference to the activity of the Financial Advisor, the activities affected by the non-recurringremuneration must observe the principles of honesty in customer relations since the main objective of thisactivity is to satisfy the interests of the customers in the best possible way in observance of the regulationsthat govern the distribution of investment products and services.

Claw back mechanisms are also envisaged (as far as legally applicable), based on which for a seven-yearperiod from the time of disbursement of the individual amount (upfront or deferred) the Group is entitled torequest the return of the variable remuneration disbursed in the following cases:

• behaviour not compliant with legal, regulatory and by-law provisions as well as any codes of ethics orconduct applicable to the bank that caused a significant loss for the bank or for the clientele;

• other behaviour not compliant with legal, regulatory and by-law provisions as well as any codes of ethicsor conduct applicable, *in the cases that may be envisaged*;

• infringements of the obligations imposed pursuant to Art. 26 (requirements of professionalism, reputationand independence of the company representatives) or, when the party is an interested party, to Art. 53,paragraphs 4 et seq. of the Consolidated Banking Act (conditions and limits set by the Bank of Italy forassuming risk activities with related parties) or of the remuneration and incentive obligations;

• fraudulent or gross negligence conduct to the detriment of the Group.

The above cases also apply as a malus condition in addition to the reasons already listed.


SECTION II

1 Implementation of the remuneration policies in 2018

This section aims to represent the decisions and criteria used by the Company to determine the fixed andvariable remuneration.

In particular, the first part contains detailed information on implementation of the policies of the previous yearand on the operational mechanisms of the incentive systems adopted, and the second part provides adequaterepresentation in table format of each of the items making up the remuneration and the remunerations paid inthe year of reference for any reason and in any form by the Company or by subsidiaries or associates pursuantto the CONSOB and Bank of Italy tables are analytically explained.

2 Governance

2.1 Meetings and composition of the Remuneration Committee

In order to guarantee correct implementation and management of the remuneration policies, during 2018 theRemuneration Committee, set up at the Parent Company Banca Mediolanum S.p.A. (consisting of twoindependent Directors) met seven times.

2.2 External consultants

The Group also availed itself of the support of consultancy firms (such as EY) and professional firms in orderto guarantee maximum reliability of the support provided and of remuneration surveys carried out by the mainspecialised consultancy firms collaborating with the trade associations at times.

3 Fixed remuneration and pay mix

The fixed remuneration of the Directors and Employees was determined by referring to the benchmarks usedthrough ongoing monitoring of the general market trends, in order to define remuneration levels competitivewith the markets of reference and to guarantee internal impartiality. The analysis and monitoring of the trendsand remuneration levels were conducted both at the Italian level and internationally, also making use of studiesrelating to specific sectors and populations (Executive, Asset Management, etc.) and to the foreign countrieswhere the Group is present.

In connection with the Employees, the major reference for the Italian context is the remuneration studypromoted by the Italian Banking Association, whose technical partner is the company Deloitte.

With particular reference to the Directors, the peer of reference was identified based on comparability withBanca Mediolanum in terms of: business spheres, total assets, revenues and number of employees. Thesecriteria led to the identification of a peer of 15 institutions (9 Italian and 6 European) with regard to which thepositioning was compared with the support of the company WillisTowersWatson, independent and one of theleading companies at global level in offering Executive Compensation services. The benchmarking showed analtogether adequate positioning close to the medium levels recorded in the market of reference.

With reference to the foreign markets where the Group is present, studies promoted by the companiesWillisTowersWatson, HayGroup and PWC were used, on the basis of the specific soundness of the sample ofcompanies in the different countries.

With particular reference to Banca Mediolanum S.p.A., the following table explains the remunerations currentlydefined for the company bodies8:

8 The table refers only to the non-executive members of the Board of Directors and its committees as of the date 31/12/2018. Theremuneration package does not provide for any variable remuneration for the company bodies with control functions, i.e. the Board ofStatutory Auditors and the non-executive Directors.


BODIES

CHAIRMAN MEMBERS

Emolument Number Total emolument

Board of Directors € 600,000 12 € 730,000

Appointments Committee € 15,000 2 € 20,000

Risk Committee € 30,000 2 € 50,000

Remuneration Committee € 20,000 2 € 30,000

With regard to benefits, packages with homogeneous characteristics were offered to the various employeecategories for those belonging to the same category.

The main benefits paid during the year 2018 included:

- access to the banking and financial products at facilitated conditions;- systems supplementing the welfare and social security plans;- liability insurance policy;- corporate welfare plans addressed to homogeneous employee categories aimed at providing refunds for

school expenses of children, assistance to the elderly, from medical check-ups to recreational activities, inline with the Italian tax legislation.

During 2018, with reference to Directors and “most significant” employees, no party accrued a variableremuneration higher than the fixed component.

The total remuneration awarded to the Chief Executive Officer pertaining to 2018 remained unchangedcompared to the previous year. In particular, the maximum variable remuneration upon attainment of 100% ofthe objectives is a component equalling 26.7% of the total remuneration granted.


4 Variable remuneration and non-recurring component (performance share plans)

Top Management

2018 – pers. più

Rilevante

Top Management

2018 - altro

personale

Collaboratori 2018 –

pers. più Rilevante

Collaboratori 2018 –

pers. non rilevante

Gate condition

Correlazione a

Utile (bonus

pool)

Quota up-front e

quota differita• 60% del variabile è up-

front; e

• il restante 40% è differito.

• 100% del variabile è

dif ferito.

Quota in

strumenti equity

50% sia della quota up-

front, sia della quota

dif ferita.

Il 100% della quota differita è

in strumenti equity (azioni).

50% sia per la parte up-front,

sia per la parte dif ferita.

Il 100% del variabile è in

strumenti equity (azioni).

Periodo di

Performance

Periodo di

retention sulla

quota in

strumenti equity

1 anno 1 anno 1 anno -

Periodo di

differimento

2 anni* 2 anni 2 anni 9 anni

Tipo di veicolo

Soglia minima di

applicazione di

up-front e

differito

N/A

Soggetti

partecipanti al

piano

Personale rilevante oltre

soglia di 75k/euro di

variabile complessivo

nell’anno.

Personale considerato

«Executive» sia rilevante non

oltre la soglia di 75k/euro, sia

non rilevante.

PF identif icati come

«personale più rilevante» e

altri PF con remunerazione

2017 superiore a 750k.

PF non identificati come

«personale più rilevante», in

virtù della corresponsione di

forme di remunerazione

variabile attraverso strumenti

di capitale.

Cap massimo: 200% (per

alcuni ruoli specif ici).

Cap massimo: 200%.CAP variabile vs

Retrib. Fissa

Cap massimo per le funzioni di controllo: 33%.

Performance Shares.

1 anno

>€ 75.000 di remunerazione variabile maturata nell’anno.

Si utilizza una scala di correlazione tra bonus pool e

valore dell'Utile Netto Consolidato (UTC), tale per cui a

valori del cancello inferiori al 70% dell'utile Target non si

genera bonus pool da distribuire; in caso di valori del

UTC compresi tra il 70% e il 100% del Target si genera

un bonus pool proporzionale al risultato ottenuto.

Risultato economico positivo in misura non inferiore al

20% dell'utile target.

RARORAC, patrimonializzazione, liquidità. Patrimonializzazione, liquidità.

• 60% del variabile è up-front; e

• il restante 40% è differito.

* Subsidiaries availing of the plan may stands the deferral period to 3 years in order to comply with specific

provisions and legislation of the country or industry.


4.1 Top Management Incentive Plan 2018

With reference to the 2018 incentive plan, the risk indicators identified and their threshold values are thefollowing:

The values of these indicators are measured at Group level and checked at the end of the period, i.e. at 31/12of the year the performance is measured (accrual period) and at the end of each year prior to that of distributionwith reference to any deferment amounts.

Failure to reach even just one of the threshold values indicated leads to elimination of the variableremunerations for each participant in the formalised incentive plans. The plan does not provide for thepossibility to exercise discretion to this regard.

With reference to the year 2018, the values measured at Group level as at 31/12 were the following:

• RARORAC: 1.6%• Surplus of capital compared to the capital requirements: 437 (million)• LCR: 352%

The variable remuneration plan is addressed to the “Top Management - Most Significant Personnel”,Directors/Executives (with portion accrued during the year on the whole higher than the significance thresholdof Euro 75,000/year).

The variable remuneration plan is also addressed to the “Executive” personnel (whether significant under thethreshold or non-significant) according to specific procedures explained hereunder.

As regards the parties identified as “most significant personnel” who accrue bonuses higher than Euro 75,000during the year, a system deferring the payment of a part of the amount of the variable remuneration appliesin compliance with the Supervisory Regulations in effect at the time and based on application of the principleof proportionality, requiring that:

• a considerable portion - 50% of the up front portion and of the deferred portion - be paid by way ofassignment of Performance Shares;

• an adequate percentage - 40% of the variable remuneration - be subject to deferred payment systems fora 2-year period and be disbursed pro rata so that the remuneration can take into account the risks taken;

Objectives at Group level

Pa

ram

ete

rs

Creation of value corrected forthe risk

Capitalisation Liquidity

Ind

ica

tors

Risk adjusted return on riskadjusted capital” (“RARORAC”)

Existence of a surplus of capitalcompared to the capital

requirementsLiquidity coverage ratio (“LCR”)

Th

res

ho

ldv

alu

es

RARORAC equal to or greaterthan 0%

Surplus compared to theregulatory requirements

LCR higher than 100%


• a specific retention period - one year - for both the short-term (up front) component and the deferred portionpaid in financial instruments.

The deferred payments will be made on the condition of the minimum access thresholds (RARORAC, LCRand capitalisation) being passed for the period previous to that of liquidation and on the basis of theConsolidated Net Profit as performance indicator.

Furthermore, the correlation between the Consolidated Net Profit and determination of the bonus pool isensured by the following scale:

Actual Cumulative Consolidated Net Profit Multiplier

< 70% of the Target 0%

= 70% <= 100% of the Target Directly proportionate (70% - 100%)

> 100% of the Target 100%

The number of Performance Shares assignable to each plan participant is determined by dividing 50% of thebonus accrued by the average price, meant as the arithmetic mean of the official prices of the BancaMediolanum share during the 30 exchange open days prior to the date of the Shareholders’ Meeting.

The resulting shares will be actually assigned and made available to each participant in the plan only at theend of the deferment and retention period of each tranche and subject to verification of the malus conditions.

The plan also requires that in particular circumstances that are individually and singularly assessed (e.g. in thecase assignment of shares to specific parties is considered inadvisable) the equivalent value can be paid inlieu of the actual shares at the time of actual assignment (so-called phantom shares), thereby keeping thedeferment and retention periods and the equity-based correlation entirely unaltered. This determination ismade by the Board of Directors upon the proposal of the Remuneration Committee and with the priorabstention of the parties who might be affected by the decision.

Dividends or interest on the financial instruments are not paid, and the instruments are awarded based on thevariable remuneration plans during the deferment or retention periods.

Furthermore, in order to create incentives for retention and commitment of the other resources in the Groupwho make a significant contribution to the success of the Company and Group, in any case paying a


remuneration component in line with the market practices and encourage retention of the recipients, theCompany has decided to also adopt several of the main elements of the regulations on the subject also withreference to other managerial population brackets with less strict rules governing disbursement of the variableunder the “Top Management - Most Significant Personnel” plan.

In particular, already in 2015 another plan for the “Executives” (whether significant under the threshold or non-significant) was introduced, according to which:

• 60% of the variable remuneration is disbursed in cash and up front;

• an adequate percentage - the remaining 40% of the variable remuneration - is paid in performance sharesand subject to deferred payment systems for a 2-year period so that the remuneration can take intoaccount the risks taken;

• the presence of a specific retention period - one year - applies to the deferred portion.

Payments of the bonuses will be made on the condition of the same access thresholds (RARORAC, LCR andcapitalisation) established for the “Top Management - Most Significant Personnel” and on the basis of theConsolidated Net Profit as performance indicator. Should even just one of the thresholds not be reached, thevariable remuneration systems are entirely eliminated.

The number of shares assignable to each plan participant is determined by dividing 40% of the bonus accruedby the average price, meant as the arithmetic mean of the official prices of the Banca Mediolanum share duringthe 30 exchange open days prior to the Shareholders’ Meeting.

The resulting shares will be actually assigned and made available to each participant in the plan only at theend of the deferment and retention period and subject to verification of the malus conditions.

In compliance with particular supervisory regulations of the sector applicable to Group components, or in caseof particular policies of the local regulators (single country) specific amendments to the general plan areapplied, and they particularly provide for, in certain cases, the application of longer deferment periods, up tothree years, and the circumstance of paying the portion in financial instruments (e.g. portions of the managedfunds in the case of asset management companies) using other vehicles other than the shares of the ParentCompany or not assigning real shares, but their corresponding value.

4.2 Collaborators Incentive Plan 2018

With reference to the 2018 incentive plan, the right to receive incentives is tied to the attainment of riskindicators in addition to the actual result reached.

The following indicators and their threshold values (access gate) have been identified:


• LCR: > 100%;• Existence of a surplus of capital compared to the capital requirements.

The values of these indicators are measured at Group level and checked at the end of the period, i.e. at 31/12of the year the performance is measured (accrual period) and at the end of each year prior to that of distributionwith reference to any deferment amounts.

The incentive system is based on identification of individual objectives for the bankers and group forsupervisors and managers, explained in the paragraphs below.

The new variable remuneration plan is addressed to the “Collaborators - Most Significant Personnel”, MaterialRisk Takers” Network.

The new variable remuneration plan is also addressed to the “non-significant” Network managers accordingto specific procedures explained below.

As regards the Collaborators and Network Personnel identified as “most significant personnel” and those whohave accrued a total remuneration higher than Euro 750,000, a system deferring the payment of a part of theamount of the non-recurring component applies in compliance with the Supervisory Regulations in effect atthe time and based on application of the principle of proportionality, requiring that:

• an adequate percentage - 40% of the non-recurring component - be subject to deferred payment systemsfor a 2-year period and be disbursed pro rata so that the remuneration can take into account the riskstaken;

• a considerable portion - 50% of the up front portion and of the deferred portion - be paid by way ofassignment of Performance Shares with the purchase of treasury shares;

• a specific retention period - one year - for both the non-recurring component paid up front and the deferredportion.

The deferred payments will be made on the condition of the minimum access thresholds (LCR andcapitalisation) being passed for the period previous to that of liquidation.

If even one of the thresholds is not reached, the variable remuneration systems are eliminated for everyone(in exceptional and carefully assessed cases and in any case when there is a positive profit, the Board ofDirectors, after consulting with the Remuneration Committee, may decide to distribute a reduced portion of thebonus pool, also with reference to specific personnel categories).

Furthermore, the correlation between the Consolidated Net Profit and determination of the bonus pool isensured if the economic result is positive no less than 20% of the budget figure.

The number of shares assignable to each plan participant is determined by dividing 50% of the bonus accruedby the average price of the Banca Mediolanum share during the 30 exchange open days prior to the date ofthe Shareholders’ Meeting.

The resulting shares will be actually assigned and made available to each participant in the plan only at theend of the deferment and retention period of each tranche and subject to verification of the malus conditions.

Furthermore, in order to create incentives for retention and commitment of the other resources in the Groupwho make a significant contribution to the success of the Company and Group, in any case paying aremuneration component in line with the market practices and encourage retention of the recipients, theCompany has decided to not only ensure compliance with the legislation of reference, but also adopt severalof the main elements of the regulations on the subject also with reference to other managerial populationbrackets with less strict rules governing disbursement of the variable under the “Collaborators - MostSignificant Personnel” plan.

More specifically, a “sub-plan” for Collaborators not identified as “most significant personnel” was introduced,according to which:

• a specific objective is remunerated in performance shares and subject to deferred payment systems fora 9-year period so that the remuneration can take into account the risks taken;

• the presence of a specific retention period does not apply to the deferred portion.

Payments of the bonuses will be made on the condition of the same access thresholds (LCR and capitalisation)


established for the “Collaborators - Most Significant Personnel” and on the basis of the economic result asperformance indicator.

If even one of the thresholds is not reached, the variable remuneration systems are eliminated for thoseparticipating in the plan (in exceptional and carefully assessed cases and in any case when there is a positiveprofit, the Board of Directors, after consulting with the Remuneration Committee, may decide to distribute areduced portion of the bonus pool, with reference to only the Sales Network based on the specificities of thesespecific personnel and the market context distinguishing them).

The resulting shares will be actually assigned and made available to each participant in the plan only at theend of the deferment period and subject to verification of the malus conditions.

4.3 Individual quantitative objectives

With reference to the individual objectives, in observance of the assessment systems adopted in the Group,they are defined according to the following main guidelines:

• the result areas must be considerably easy to be influenced by the beneficiary of the incentive;

• the performance indicators identified for the result areas must be closely related to the total result/valuegenerated by the local/organisational units responsible for them;

• it is necessary to consider objectives as measurable as possible and relating to sales/economic figurestied to the budgets and within the visibility of the Planning and Control function. To this regard, it isnecessary to ensure that the final balance of the performance indicator for the Sales NetworkAdministration can recorded at the end of the measurement period.

The incentive system of the Financial Advisors is mostly addressed at the deposits activity that can be tracedback to macro aggregates. This approach prevents the incentive policies from being able to favour thedistribution of specific products in potential conflict of interest for the Bank and for the Network.

Other parameters that are adopted regard the organisational structure of the network, training, recruitment,ever greater adoption of evolved IT tools helpful for better serving the customers and the growth anddevelopment of the professional figures within the Sales Network.

4.4 Individual qualitative objectives

The need to adopt qualitative correction criteria on the non-recurring component paid to the Network, inspiredby honesty in customer relations criteria, reducing legal and reputation costs, customer protection and retentionin keeping with the applicable legal, regulatory and self-governance provisions is met through a singleperformance indicator (RUP - Single Performance Rating).

This indicator requires that a set of qualitative parameters be used to evaluate the banker’s work, and theyalso represent the best practices commonly adopted by the leading competitors.

The Single Performance Rating is regulated within a specific implementing regulation document.

Added to it are the disciplinary sanctions (suspensions and revocations) inflicted during the entire period ofreference.

4.5 Methods for disbursing the non-recurring component

Generally speaking, incentive bonuses are not provided for in circumstances of non-compliant conduct orformalised disciplinary actions.

All disbursements of the incentives are made only provided that the agency agreement is regularly in effect onthe dates scheduled for the disbursements and that all conditions required to attain established resultobjectives have been met.

As for the disbursement time table, the short-term incentive is liquidated after the results of the year ofreference have been tallied, while any medium-/long-term incentive, possibly to be paid in monetary form, isliquidated after the deferment period has elapsed.


5 Incentive plans adopted by the Group relating to previous year that have not yetclosed

The systems already adopted by the Group, which retain their effect particularly in their long-term variableremuneration and based on the agreements currently in effect, are described below.

These systems provide for the incentive component to be also formed by a variable medium-/long-termremuneration, typically on a three-year basis and formed entirely by financial instruments.

The component indicated above is paid based on the attainment of certain objectives related to both economicand other types of parameters, and more specifically:

• company objectives, for which the incentive system provides for considering the attainment of the TargetConsolidated Net Profit referring to the Mediolanum Group as the parameter that defines the annualvariable that can be disbursed to each participant in the incentive plans (both short-term and medium-/long-term);

• individual objectives, where provided for, based on the following assessment areas:- quantitative objectives;

- qualitative objectives.

5.1 Capital instruments-based plans: “2010 Top Management plan”

The last assignment of the “2010 Top Management Plan” dates to the year 2014.

Over the course of 2018 this plan has produced its last effects, the vesting period having ended and all optionspreviously assigned having been exercised and not lost during the years of the plan’s validity.

The main characteristics of the stock option plan approved by the ordinary Shareholders’ Meeting of the thenParent Company Mediolanum S.p.A. of 27 April 2010 are listed below.

• Recipients: directors of Mediolanum S.p.A. and/or of its subsidiaries pursuant to Art. 2359, paragraph 1of the Italian Civil Code and executives of the Company and Subsidiaries. The criteria for assigninginstruments were based on the strategic nature of the resource and on the impact that it can have on thecompany’s results.

• Subscription price: determined on the date the options are assigned, it is the weighted average between:(i) the value of the shareholders’ equity per share of the Company resulting from its financial statementsas at 31 December of the year before the date the options are assigned, regularly approved (90% weight)and (ii) the average official stock market price of the shares of the Company in the Electronic EquityMarket, organised and managed by Borsa Italiana, in the half-year period prior to the date the options areassigned (10% weight).

• Vesting period: 3 years starting from the date the options are assigned.

• Underlying indicators:

- Exercise conditions that continue throughout the vesting period: (i) attainment of a cumulativeconsolidated net profit of Mediolanum S.p.A., (ii) keeping a “Return on risk adjusted capital” (RORAC)higher than 15% at the Mediolanum Financial Conglomerate level provided that the capitalrequirements have not increased more than 3% during the same three-year period of reference andthere is a capital surplus with regard to the applicable pro tempore capital requirements, and lastly (iii)keeping the relationship between the recipient and Mediolanum S.p.A. or a subsidiary.

- Individual conditions: the Remuneration Committee can subordinate exercise of the options also to theattainment of performance objectives identified from time to time.

• Lock- up: a non-transferability restriction of a percentage of 5% of the subscribed shares for a 3-yearperiod, or until the mandate (if director) expires or, until the employment terminates (if executive) isprovided for.

5.2 Capital instruments-based plans (2010 Collaborators Plan)

The last assignment of the “2010 Collaborators Plan” dates to the year 2015.

The capital instruments-based plans for the Sales Network provide for exercising assigned options provided


that Group results are attained, and more specifically:

• target value of the consolidated net profit relating to the entire period of measurement of the results; as analternative, attainment each year of reference of an amount of Mediolanum S.p.A. bank net inflowspositioned in the 1st quartile of the classification of sales networks published by Assoreti, howeversubordinate to attainment of a consolidated net profit no lower than 70%;

• keeping a certain “Return on risk adjusted capital” (“RORAC”) level and a capital surplus with regard tothe applicable pro tempore capital requirements.

The Board of Directors determines the vesting period by assigning options equal to 9 years from theassignment date.

Exercise of the options, and the consequent subscription of the shares by the recipients, are allowed only afterthe vesting period has elapsed, starting from the date the exercising begins and for the next three years.Exercise of the options and the consequent subscription of the shares must take place in a single paymentand for the entire amount during the exercise period.


6 Quantitative information provided pursuant to Art. 123-ter of Italian Legislative Decree no. 58 (Consolidated Finance Act)of February 1998; Art. 84-quater of CONSOB Issuers’ Regulation no. 11971

TABLE 1: Remuneration paid to the members of the administration and control bodies, to the general managers and to the other key management.

Bonus e altri

incentivi

Partecipazione

agli utili

(A) (B) (C) (D) (1) (2) (4) (5) (6) (7) (8)

Doris Ennio Presidente del Consiglio di Amministrazione 01/01/2018 - 31/12/2018 31/12/2020

€ 600.000 € - € - € - € - € - € 600.000 € - € -

€ - € - € - € - € - € - € - € - € -

€ 600.000 € - € - € - € - € - € 600.000 € - € -

Lombardi Edoardo Vice Presidente Vicario 01/01/2018 - 10/04/2018 31/12/2017

€ 37.500 € - € - € - € - € - € 37.500 € - € -

€ - € - € 316.050 € - € - € - € 316.050 € 66.763 € -

€ 37.500 € - € 316.050 € - € - € - € 353.550 € 66.763 € -

Pirovano Giovanni Vice Presidente 01/01/2018 - 31/12/2018 31/12/2020

€ 230.000 € 11.250 € 23.400 € - € 6.049 € - € 270.699 € 5.850 € -

€ 26.000 € - € - € - € - € - € 26.000 € - € -

€ 256.000 € 11.250 € 23.400 € - € 6.049 € - € 296.699 € 5.850 € -

Doris Massimo Antonio Amministratore Delegato 01/01/2018 - 31/12/2018 31/12/2020

€ 1.109.615 € - € 196.000 € - € 6.393 € - € 1.312.008 € 131.667 € -

€ - € - € - € - € - € - € - € - € -

€ 1.109.615 € - € 196.000 € - € 6.393 € - € 1.312.008 € 131.667 € -

Nome e cognome Carica

Periodo per cui

è stata

ricoperta la

carica

Fair Value

dei compensi

equity

Indennità di

f ine carica o di

cessazione del

rapporto di

lavoro

(3)

1(I) Compensi nella società che redige il bilancio

(II) Compensi da controllate e collegate

(llI) Totale

Compensi

fissi

Compensi per

Ia

partecipazione

a comitati

Compensi variabili non equity

Benefici non

monetari

Altri

compensiTotale

Scadenza della

carica*

Note

Note:



(llI) Totale

Note:

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di membro del Comitato Remunerazioni € 11.250. Benefici non monetari: € 6.049 trattasi di importo complessivo relativo ai benefit erogati, determinato in base a quanto rileva

fiscalmente. Compensi da controllate e collegate: per la carica di Presidente del Consiglio di Amministrazione in società controllata € 6.000 e per contratto di collaborazione € 20.000.

Note:

Compensi f issi per la carica di Amministratore Delegato nella società che redige il bilancio € 600.000, compensi per il rapporto di dipendenza con la società che redige il bilancio € 509.615. Per la partecipazione a sistemi di incentivazione nella società che redige il bilancio

complessivamente per la competenza dell'anno € 284.000 (si veda tabella 3a e 3b per dettaglio su up front e deferred quota cash e strumenti equity). Benefici non monetari: € 6.393 trattasi di importo complessivo relativo ai benefit erogati, determinato in base a quanto rileva

fiscalmente.



(llI) Totale



(llI) Totale


Bonus e altri

incentivi

Partecipazione

agli utili

(A) (B) (C) (D) (1) (2) (4) (5) (6) (7) (8)

Berlusconi Luigi Consigliere 28/07/2018 - 10/04/2018 31/12/2017

€ 6.250 € - € - € - € - € - € 6.250 € - € -

€ - € - € - € - € - € - € - € - € -

€ 6.250 € - € - € - € - € - € 6.250 € - € -

Bianchi Bruno Consigliere 01/01/2018 - 31/12/2018 31/12/2020

€ 46.250 € 27.500 € - € - € - € - € 73.750 € - € -

€ 15.000 € - € - € - € - € - € 15.000 € - € -

€ 61.250 € 27.500 € - € - € - € - € 88.750 € - € -

Del Fabbro Luigi Consigliere 01/01/2018 - 10/04/2018 31/12/2017

€ 8.750 € 7.500 € - € - € 1.322 € - € 17.572 € - € -

€ 680.000 € - € 102.600 € - € 3.945 € - € 786.545 € 71.250 € -

€ 688.750 € 7.500 € 102.600 € - € 5.267 € - € 804.117 € 71.250 € -

Doris Annalisa Sara Consigliere 01/01/2018 - 31/12/2018 31/12/2020

€ 43.750 € 10.000 € - € - € - € - € 53.750 € - € -

€ - € - € - € - € - € - € - € - € -

€ 43.750 € 10.000 € - € - € - € - € 53.750 € - € -


Periodo per cui

è stata

ricoperta la

carica

Fair Value

dei compensi

equity

Indennità di

f ine carica o di

cessazione del

rapporto di

lavoro

(3)

Compensi

fissi

Compensi per

Ia

partecipazione

a comitati


Benefici non

monetari

Altri

compensiTotale

Scadenza della

carica*



(llI) Totale

Note

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di Presidente Comitato Rischi € 6.250, per la carica di membro del Comitato Rischi € 18.750 e per la carica di membro del Comitato Nomine € 2.500. Compensi in società Controllate e

Collegate: per la carica di Consigliere in società controllate € 15.000.



(llI) Totale

Note:

Compensi per la partecipazione a comitati nella società che redige il bilancio: € 5.000 per la caria di membro del Comitato Rischi e € 2.500 per la carica di membro del Comitato Remunerazioni. Per la partecipazione a sistemi di incentivazione in società controllata per la

competenza dell'anno € 142.000 (si veda tabella 3a e 3b per dettaglio su up front e deferred quota cash e strumenti equity). Benefici non monetari: € 5.267 trattasi di importo complessivo relativo ai benefit erogati, determinato in base a quanto rileva fiscalmente. Compensi da

controllate e collegate: per le cariche di Amministratore Delegato in Società controllate € 680.000.

Note

Compensi per la partecipazione a comitat nella società che redige il bilancio: per la carica di membro del Comitato Nomine € 10.000.



(llI) Totale



(llI) Totale


Bonus e altri

incentivi

Partecipazione

agli utili

(A) (B) (C) (D) (1) (2) (4) (5) (6) (7) (8)

Durante Paola Consigliere 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € - € - € - € - € - € 37.500 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € - € - € - € - € - € 37.500 € - € -

Frasca Francesco Consigliere 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € 22.500 € - € - € - € - € 60.000 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € 22.500 € - € - € - € - € 60.000 € - € -

Gavazza Alessandro Consigliere 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € - € - € - € - € - € 37.500 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € - € - € - € - € - € 37.500 € - € -

Gualtieri Paolo Consigliere 01/01/2018 - 10/04/2018 31/12/2017

€ 8.750 € 7.500 € - € - € - € - € 16.250 € - € -

€ - € - € - € - € - € - € - € - € -

€ 8.750 € 7.500 € - € - € - € - € 16.250 € - € -

Note

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di membro del Comitato Rischi € 22.500.



(llI) Totale

Note

Note

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di membro del Comitato Remunerazioni € 7.500.



(llI) Totale

Note



(llI) Totale


Periodo per cui

è stata

ricoperta la

carica

Fair Value

dei compensi

equity

Indennità di

f ine carica o di

cessazione del

rapporto di

lavoro

(3)

Compensi

fissi

Compensi per

Ia

partecipazione

a comitati


Benefici non

monetari

Altri

compensiTotale

Scadenza della

carica*



(llI) Totale


Bonus e altri

incentivi

Partecipazione

agli utili

(A) (B) (C) (D) (1) (2) (4) (5) (6) (7) (8)

Notari Mario Consigliere 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € 26.250 € - € - € - € - € 63.750 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € 26.250 € - € - € - € - € 63.750 € - € -

Omarini Anna Eugenia Maria Consigliere 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € 30.000 € - € - € - € - € 67.500 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € 30.000 € - € - € - € - € 67.500 € - € -

Pierantoni Roberta Consigliere 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € 7.500 € - € - € - € - € 45.000 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € 7.500 € - € - € - € - € 45.000 € - € -

Renoldi Angelo Consigliere 01/01/2018 - 10/04/2018 31/12/2017

€ 8.750 € 7.500 € - € - € - € - € 16.250 € - € -

€ 45.000 € 10.000 € - € - € - € - € 55.000 € - € -

€ 53.750 € 17.500 € - € - € - € - € 71.250 € - € -

Note

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di membro Comitato Nomine € 7.500.

Note

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di Presidente del Comitato Nomine € 11.250 e per la carica di Presidente del Comitato Remunerazioni € 15.000.



(llI) Totale

Note

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di membro Comitato Rischi € 18.750 e per la carica di membro del Comitato Remunerazioni € 11.250.



(llI) Totale

(llI) Totale

Note

Compensi per la partecipazione a comitati nella società che redige il bilancio: per la carica di Presidente del Comitato Remunerazioni € 3.750 e per la carica di Presidente Comitato Nomine € 3.750. Compensi in società Controllate e Collegate: per le cariche di Presidente del

Consiglio di Amministrazione in società controllate € 45.000 e per la carica di Presidente Organismo di Vigilanza e Controllo in società controllata € 10.000.



(llI) Totale


Periodo per cui

è stata

ricoperta la

carica

Fair Value

dei compensi

equity

Indennità di

f ine carica o di

cessazione del

rapporto di

lavoro

(3)

Compensi

fissi

Compensi per

Ia

partecipazione

a comitati


Benefici non

monetari

Altri

compensiTotale

Scadenza della

carica*




Bonus e altri

incentivi

Partecipazione

agli utili

(A) (B) (C) (D) (1) (2) (4) (5) (6) (7) (8)

Sarubbi Giacinto Gaetano Consigliere 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € - € - € - € - € - € 37.500 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € - € - € - € - € - € 37.500 € - € -

Tusquets Trias De Bes Carlos Javier Consigliere 01/01/2018 - 31/12/2018 31/12/2020

€ 43.750 € - € - € - € - € - € 43.750 € - € -

€ 97.107 € - € - € - € - € - € 97.107 € - € -

€ 140.857 € - € - € - € - € - € 140.857 € - € -

Fava Domenico Presidente del Collegio Sindacale 10/04/2018 - 31/12/2018 31/12/2020

€ 56.250 € - € - € - € - € 18.750 € 75.000 € - € -

€ - € - € - € - € - € - € - € - € -

€ 56.250 € - € - € - € - € 18.750 € 75.000 € - € -

Meneghel Francesca Presidente del Collegio Sindacale 21/11/2018 - 10/04/2018 31/12/2017

€ 18.750 € - € - € - € - € 7.405 € 26.155 € - € -

€ 40.000 € - € - € - € - € 4.550 € 44.550 € - € -

€ 58.750 € - € - € - € - € 11.955 € 70.705 € - € -



(llI) Totale

Note

Altri compensi nella società che redige il bilancio: per la carica di Presidente Organismo di Vigilanza e Controllo € 18.750.

Note

Altri compensi nella società che redige il bilancio: per la carica di Presidente Organismo di Vigilanza e Controllo € 7.405. Compensi da controllate e collegate: per le cariche di Sindaco in società controllata € 40.000 e per altri compensi per la carica di membro Organismo di

Vigilanza e Controllo in società controllata € 4.550.



(llI) Totale



(llI) Totale


Periodo per cui

è stata

ricoperta la

carica

Fair Value

dei compensi

equity

Indennità di

f ine carica o di

cessazione del

rapporto di

lavoro

(3)

Compensi

fissi

Compensi per

Ia

partecipazione

a comitati


Benefici non

monetari

Altri

compensiTotale

Scadenza della

carica*

Note

Compensi da controllate e collegate: per la carica di Presidente del Consiglio di Amministrazione in società controllata € 97.107.



(llI) Totale

Note


(*) The expiration date refers to the Shareholders’ Meeting that will approve the Financial Statements regarding the specified year.

Bonus e altri

incentivi

Partecipazione

agli utili

(A) (B) (C) (D) (1) (2) (4) (5) (6) (7) (8)

Angeli Adriano Alberto Sindaco Effettivo 21/11/2018 - 10/04/2018 31/12/2017

€ 12.500 € - € - € - € - € 5.000 € 17.500 € - € -

€ - € - € - € - € - € - € - € - € -

€ 12.500 € - € - € - € - € 5.000 € 17.500 € - € -

Giuliani Marco Sindaco Effettivo 21/11/2018 - 10/04/2018 31/12/2017

€ 14.315 € - € - € - € - € 5.000 € 19.315 € - € -

€ 82.000 € - € - € - € - € 14.000 € 96.000 € - € -

€ 96.315 € - € - € - € - € 19.000 € 115.315 € - € -

Lunardi Antonella Sindaco Effettivo 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € - € - € - € - € 15.000 € 52.500 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € - € - € - € - € 15.000 € 52.500 € - € -

Sala Gian Piero Sindaco Effettivo 10/04/2018 - 31/12/2018 31/12/2020

€ 37.500 € - € - € - € - € 15.000 € 52.500 € - € -

€ - € - € - € - € - € - € - € - € -

€ 37.500 € - € - € - € - € 15.000 € 52.500 € - € -

01/01/2018 - 31/12/2018 na

€ 825.184 € - € 352.925 € - € 13.256 € - € 1.191.365 € 212.365 € -



(llI) Totale



(llI) Totale

Note

Altri compensi nella società che redige il bilancio: per la carica di membro dell'Organismo di Vigilanza € 5.000.

Note

Altri compensi nella società che redige il bilancio: per la carica di membro dell'Organismo di Vigilanza € 5.000. Compensi da controllate e collegate: per la dif ferenti cariche all'interno del Collegio Sindacale in società controllate € 82.000. Altri compensi da controllate e

collegate: per la carica di membro dell'Organismo di Vigilanza in società controllata € 14.000.


Periodo per cui

è stata

ricoperta la

carica

Fair Value

dei compensi

equity

Indennità di

f ine carica o di

cessazione del

rapporto di

lavoro

(3)

Compensi

fissi

Compensi per

Ia

partecipazione

a comitati


Benefici non

monetari

Altri

compensiTotale

Scadenza della

carica*

Note

I dati relativi ai Dirigenti con responsabilità strategiche sono indicati a livello aggregato e sono riferiti al Direttore Generale e al Dirigente Preposto alla redazione dei documenti contabili societari nella società che redige il bilancio. Benefici non monetari: € 20.352 trattasi di

importo complessivo relativo ai benefit erogati, determinato in base a quanto rileva fiscalmente. La componente variabile della remunerazione per la competenza dell'anno (si veda tabella 3a e 3b per dettaglio su up front e deferred quota cash e strumenti equity) verrà

determinata a seguito del completamento dell'iter autorizzativo inerente i piani di incentivazione ed erogata al consolidamento dei dati di bilancio; le informazioni riportate sono quindi, per la componente variabile, stimate e valorizzate al massimo del risultato realizzabile.



(llI) Totale

Dirigenti Strategici25

(llI) Totale

Note




(llI) Totale

Note



TABLE 2: Stock options assigned to the members of the administration and control body, to the general managers and to the other key management.

Regarding the above-mentioned table 2, the information is missing due to the Stock Option plans running out for the personnel considered.

Opzioni

scadute

nell’esercizio

Opzioni

detenute alla

fine

dell'esercizio

Opzioni di

competenza

dell'esercizio

Nome e

cognomeCarica Piano

Numero

opzioni

Prezzo di

esercizio

Periodo

possibile

esercizio

(dal - al)

Numero

opzioni

Prezzo di

esercizio

Periodo

possibile

esercizio

(dal - al)

Fair value alla

data di

assegnazione

Data di

assegnazione

Prezzo di

mercato delle

azioni

sottostanti

all’assegnazio

ne delle

opzioni

Numero

opzioni

Prezzo di

esercizio

Prezzo di

mercato delle

azioni

sottostanti

alla data di

esercizio

Numero opzioni Numero opzioni Fair value

(A) (B) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14)(15) = (2)+(5)-

(11)-(14)(16)

Note

4

(I) Compensi nella società che

redige il bilancio

(II) Compensi da controllate e

collegate

(llI) Totale

2

(llI) Totale

1


collegate

Note

Opzioni detenute all’inizio

dell’esercizioOpzioni assegnate nel corso dell’esercizio

Opzioni esercitate nel corso

dell’esercizio


redige il bilancio

(llI) Totale


redige il bilancio


collegate

Note

Note

3


redige il bilancio


collegate

(llI) Totale


TABLE 3A: Financial instrument-based incentive plans other than stock options for the members of the administration body, general managers andother key management.

Strumenti finanziari

vested nel corso

dell'esercizio e non

attribuiti

Strumenti

finanziari di

competenza

dell’esercizio

Nome e cognome Carica PianoNumero e tipologia di

strumenti f inanziariPeriodo di vesting

Numero e

tipologia di

strumenti

finanziari

Fair value alla

data di

assegnazione

Periodo di

vesting

Data di

assegnazione

Prezzo di

mercato

all'assegnazion

e

Numero e tipologia di

strumenti f inanziari

Numero e tipologia

di strumenti

f inanziari

Valore alla data di

assegnazioneFair Value

(A) (B) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12)

Doris Massimo

Antonio

Amministratore

Delegato

Top

Management

Personale

Rilevante

30.441 unit di

Performance Share

60% 1 anno di

retention, 20% 1 anni di

dif ferimento più uno di


dif ferimento più un

anno di retention

16.428 unit di

Performance

Share

€ 118.002

60% 1 anno di

retention, 20%

1 anni di

differimento più

uno di retention,

20% 2 anni di

differimento più

un anno di

retention

27/04/2018 € 7,18

15.945 unit di

Performance

Share

€ 110.801 € 131.667

(llI) Totale € 118.002 € 110.801 € 131.667

Lombardi

Edoardo

Vice Presidente

Vicario

Top

Management

Personale

Rilevante

55.936 unit di

Performance Share

60% 1 anno di





anno di retention

25.416 unit di

Performance

Share

€ 169.046 € 66.763

(llI) Totale € 169.046 € 66.763

2

(I) Compensi nella società che redige il

bilancio


Note

La componente variabile della remunerazione verrà determinata a seguito del completamento dell'iter autorizzativo inerente i piani di incentivazione ed erogata al consolidamento dei dati di bilancio; le informazioni riportate sono quindi, per la componente variabile,

stimate e valorizzate al massimo del risultato realizzabile.

Strumenti finanziari assegnati negli

esercizi precedenti non vested nel corso

dell'esercizio

Strumenti finanziari assegnati nel corso dell’esercizioStrumenti finanziari vested nel

corso dell’esercizio e attribuibili

1


bilancio


Note





vested nel corso


attribuiti

Strumenti

finanziari di

competenza

dell’esercizio



Numero e

tipologia di

strumenti

finanziari

Fair value alla

data di

assegnazione

Periodo di

vesting

Data di

assegnazione

Prezzo di

mercato

all'assegnazion

e



Numero e tipologia

di strumenti

f inanziari

Valore alla data di


(A) (B) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12)

Pirovano

GiovanniVice Presidente

Top

Management

Personale

Rilevante

3.485 unit di

Performance

Share

€ 23.384 € 5.850

€ 23.384 € 5.850

Del Fabbro Luigi Consigliere

Top

Management

Personale

Rilevante

13.922 unit di

Performance

Share

€ 100.002

60% 1 anno di

retention, 20%

1 anni di

differimento più

uno di retention,

20% 2 anni di

differimento più

un anno di

retention

27/04/2018 € 7,18

8.353 unit di

Performance

Share

€ 60.000 € 71.250

(llI) Totale € 100.002 € 60.000 € 71.250


bilancio


Note





dell'esercizio



3


bilancio


(llI) Totale

Note



4



vested nel corso


attribuiti

Strumenti

finanziari di

competenza

dell’esercizio



Numero e

tipologia di

strumenti

finanziari

Fair value alla

data di

assegnazione

Periodo di

vesting

Data di

assegnazione

Prezzo di

mercato

all'assegnazion

e



Numero e tipologia

di strumenti

f inanziari

Valore alla data di


(A) (B) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12)

Bosisio Gianluca Direttore Generale

Top

Management

Personale

Rilevante

21.309 unit di

Performance Share

60% 1 anno di





anno di retention

19.490 unit di

Performance

Share

€ 139.997

60% 1 anno di

retention, 20%

1 anni di

differimento più

uno di retention,

20% 2 anni di

differimento più

un anno di

retention

27/04/2018 € 7,18

21.376 unit di

Performance

Share

€ 148.395 € 125.183

€ 139.997 € 148.395 € 125.183

Lietti Angelo Dirigente Preposto

Top

Management

Personale

Rilevante

14.840 unit di

Performance Share

60% 1 anno di





anno di retention

13.574 unit di

Performance

Share

€ 97.502

60% 1 anno di

retention, 20%

1 anni di

differimento più

uno di retention,

20% 2 anni di

differimento più

un anno di

retention

27/04/2018 € 7,18

14.887 unit di

Performance

Share

€ 103.347 € 87.182

€ 97.502 € 103.347 € 87.182



dell'esercizio



Note



Note



5


bilancio


(llI) Totale

6


bilancio


(llI) Totale


TABLE 3B: Monetary incentive plans for the members of the administration body, general managers and other key management

A B (1) (4)

Nome e cognome Carica Piano Altri bonus

(A) (B) (C) (A) (B) (C)

Erogabile/Erogato Differito Periodo di dif ferimento Non più erogabili Erogabile/Erogati Ancora Differiti

Doris Massimo Antonio Amministratore Delegato

Top Management

Personale Rilevante€ 85.200,00 € 56.800,00 2 € 110.800,00 € 87.200,00

€ 85.200 € 56.800 € 110.800 € 87.200

Lombardi Edoardo Vice Presidente Vicario

Top Management

Personale Rilevante€ 316.050 € 73.500

€ - € - € 316.050 € 73.500

Pirovano Giovanni Vice Presidente

Top Management

Personale Rilevante€ 23.400

€ - € - € 23.400 € -

Bonus di anni precedenti

(2) (3)

3

(I) Compensi nella società che redige il bilancio


1



(llI) Totale

Note

La componente variabile della remunerazione verrà determinata a seguito del completamento dell'iter autorizzativo inerente i piani di incentivazione ed erogata al consolidamento dei dati di bilancio; le informazioni riportate sono quindi, per la componente variabile, stimate e

valorizzate al massimo del risultato realizzabile.

Bonus dell'anno

2



(llI) Totale

(llI) Totale

Note



Note




A B (1) (4)

Nome e cognome Carica Piano Altri bonus

(A) (B) (C) (A) (B) (C)

Erogabile/Erogato Differito Periodo di dif ferimento Non più erogabili Erogabile/Erogati Ancora Differiti

Del Fabbro Luigi Consigliere

Top Management

Personale Rilevante€ 42.600 € 28.400 2 € 60.000 € 40.000

€ 42.600 € 28.400 € 60.000 € 40.000

Bosisio Gianluca Direttore Generale

Top Management


€ 59.640 € 39.760 € 148.400 € 84.000

Lietti Angelo Dirigente Preposto

Top Management


€ 41.535 € 27.690 € 103.350 € 58.500

Bonus di anni precedenti

(2) (3)

5



4

Bonus dell'anno

6



(llI) Totale

Note



Note



(llI) Totale

Note





(llI) Totale

6.1 Equity investments held

Information on the equity investments held by the members of the administration and control bodies, thegeneral managers and the key management in the Company and in its subsidiaries is provided in table formatbelow.

The number of shares broken down by category is particularly specified by name for the members of theadministration and control bodies and for the general managers, and cumulatively for the other keymanagement, regarding each investee:

• held at the end of the previous year;

• acquired during the year of reference;

• sold during the year of reference;

• held at the end of the year of reference.

To this regard, the right of ownership and its methods are also clarified. All parties who during the year ofreference held offices of member of the administration and control bodies, general manager or key manager,even for a fraction of the year, are included.

TABLE 1: Shareholdings of the members of the administration and control bodies and of the generalmanagers

TABLE 2: Shareholdings of the other key management

Cognome e Nome Carica Società partecipata

23.563.070 (pd) - - - - 23.563.070 -

149.029.557 (pi) - - - - 149.029.557 -

46.260.000 (u) (1) - - - - 46.260.000 -

24.307.595 (c) - - - - 24.307.595 -

25.394.701 (pi c) 495.602 - - - 25.890.303 -

Lombardi Edoardo Vice Presidente Banca Mediolanum S.p.A. 768.664 (pd) - - - - 768.664 (3)

Pirovano Giovanni Vice Presidente Banca Mediolanum S.p.A. 310.000 (pd) 25.000 (4) 25.000 - 310.000 -

14.507.180 (pi) - - - - 14.507.180 -

- 18.265 (ps) - - 18.265 -

7.000 (c) - - - - 7.000 -

Del Fabbro Luigi Amministratore Banca Mediolanum S.p.A. 205.300 (pd) - - - - 205.300 -

14.494.160 (pd) - - - - 14.494.160 -

(c) 13.330 (ps) - 13.330 -

Bosisio Gianluca Direttore Generale Banca Mediolanum S.p.A. 7.232 (pd) 18.206 (ps) - - 25.438 -

Note:

(pd) partecipazione diretta

(pi) partecipazione indiretta

(u) usufrutto

(c) coniuge

(1) usufrutto congiunto con il coniuge Tombolato Lina

(2) 244.800 da stock option 42.688 da performance share

(3) di cui 300.000 cedute a soggetto di cui all'art. 152, sexies, comma 1, lett. d. 5) del R.E.

(4) 23.688 da performance share

(5) 29.520 da stock option e 16.262 da performance share

(ps) performance share

Doris Annalisa Sara Amministratore Banca Mediolanum S.p.A.

Doris Massimo Antonio Amministratore Delegato Banca Mediolanum S.p.A.

Numero azioni

possedute alla f ine

dell'esercizio in corso

Numero azioni possedute

alla f ine dell'esercizio

precedente

Numero azioni

acquistate

Numero azioni

vendute

Doris Ennio Presidente del Consiglio di Amministrazione Banca Mediolanum S.p.A.

Numero dirigenti con

responsabilità strategicaSocietà partecipata


alla fine dell'esercizio

precedente

Numero azioni

acquisatate

Numero azioni

vendute


alla fine dell'esercizio in

corso

1 Banca Mediolanum S.p.a. 132.291 12.679 (ps) 40.000 104.970

(ps) performance share

7 Quantitative information pursuant to Circular no. 285, Part I, Tit. IV, Ch. 2 and Art.450, paragraph 1(a-f) of the CRR9

TABLE A pursuant to Art. 450, paragraph 1(g): aggregated quantitative information on theremunerations broken down by lines of business10

TABLE B pursuant to Art. 450, paragraph 1(h) I-II: aggregated quantitative information onremunerations, broken down by senior managers and staff members whose actions have a significantimpact on the entity’s risk profile

9 The variable component of the remuneration will be determined after completion of the process of authorisation pertaining to the incentiveplans and distributed upon consolidation of the balance sheet data; the information provided is therefore estimated and valued at themaximum realisable result for the variable component.10 The lines of business, identified to determine the information on the aggregated remunerations, are the same adopted for benchmarkingpurposes according to the EBA reporting schemes.

Linee di Attività Numero BeneficiariRemunerazione totale

31.12.2017

Componenti dell'organo di supervisione strategica 44 2.979.891€

Componenti dell'organo di gestione 6 4.376.133€

Investment banking 5.876 534.335.031€

Retail banking 1.035 37.343.039€

Asset management 131 10.642.810€

Funzioni aziendali 1032 58.333.280€

Funzioni aziendali di controllo 219 12.694.745€

Altre 36 2.386.104€

Parte della remunerazione variabile verrà determinata ed erogata a seguito del consolidamento dei dati di bilancio; le

informazioni riportate per la remunerazione variabile sono quindi oggetto di stima.

Contanti AzioniStrumenti collegati

alle azioniAltri strumenti

Consiglieri Esecutivi 6 € 3.154.629 € 1.018.140 € 509.070 € 509.070

Consiglieri non

Esecutivi12 € 1.499.357 € - € - € -

Alta Dirigenza 3 € 922.417 € 397.600 € 198.800 € 198.800

Altri Material Risk Taker 53 € 40.531.123 € 6.393.231 € 3.412.726 € 2.980.505

Funzioni di Controllo 16 € 1.870.299 € 252.760 € 186.020 € 66.740

CategorieNumero

Beneficiari

Retribuzione

Fissa

Retribuzione

Variabile

Forme della componente variabile suddivisa in

Parte della remunerazione variabile verrà determinata ed erogata a seguito del consolidamento dei dati di bilancio; le informazioni riportate per

la remunerazione variabile sono quindi oggetto di stima.

TABLE C11 pursuant to Art. 450, paragraph 1(h) III-IV: aggregated quantitative information onremunerations, broken down by senior managers and staff members whose actions have a significantimpact on the entity’s risk profile

TABLE D pursuant to Art. 450, paragraph 1(h) V-VI: aggregated quantitative information onremunerations, broken down by senior managers and staff members whose actions have a significantimpact on the entity’s risk profile

TABLE E pursuant to Art. 450, paragraph 1(i): number of people remunerated with a certain amount

11 With regard to the long-term incentive plan, part of the variable component of the remuneration referring to the Performance Shareplans will be determined after completion of the process of authorisation pertaining to the incentive plans and distributed uponconsolidation of the balance sheet data; for the variable component in instruments linked to the shares, referring to existing previousplans, the fair value of the stock options assigned during the year of reference is meant. The information provided is therefore estimatedand valued at the maximum of the realisable result.

Quota attribuitaQuota

non attribuitaTarget

Pagata e ridotta mediante condizioni

di performance

Consiglieri Esecutivi € 1.326.090 € 187.500 € 1.138.590 € 239.202 € 239.202

Consiglieri non Esecutivi € 23.400 € 23.400 € - € 46.800 € 46.800

Alta Dirigenza € 590.493 € 102.273 € 488.220 € 160.090 € 160.090

Altri Material Risk Taker € 14.969.630 € 1.816.725 € 13.152.905 € 2.641.049 € 2.641.049

Funzioni di Controllo € 301.740 € 75.400 € 226.340 € - € -

Categorie Remunerazione Differita Totale

Di cui Rem. Differita riconosciuta durante l'esercizio

Parte della remunerazione variabile verrà determinata ed erogata a seguito del consolidamento dei dati di bilancio; le informazioni riportate per la remunerazione variabile sono quindi oggetto

di stima.

Numero

BeneficiariImporto

Numero

BeneficiariImporto

Importo più elevato

riconosciuto per

persona

Consiglieri Esecutivi

Consiglieri non Esecutivi

Alta Dirigenza

Altri Material Risk Taker 2 € 250.000

Funzioni di Controllo

Categorie

Indennità di inizio rapporto Indennità di f ine rapporto

Numero

Beneficiari

Importo nuovi

pagamenti ef fettuati

durante l'esercizio

Nuovi pagamenti effettuati durante

l'esercizioPagamenti riconosciuti durante l'esercizio

Numero Beneficiari Remunerazione complessiva

14 >= 1 mln EUR per esercizio;

10 >= 1 mln EUR <= 1,5 per esercizio;

1 >= 1,5 mln EUR <= 2 per esercizio;

- >= 2 mln EUR <= 2,5 per esercizio;

1 >= 2,5 mln EUR <= 3 per esercizio;

2 >= 3 mln EUR <= 3,5 per esercizio;

- >= 3,5 mln EUR <= 4 per esercizio;

- >= 4 mln EUR <= 4,5 per esercizio;

- >= 4,5 mln EUR <= 5 per esercizio;

- >= 5 mln EUR ripartita in fasce di pagamento di 1 mln EUR.

- >= 6 mln EUR ripartita in fasce di pagamento di 1 mln EUR.

Tra 1 e 5 mln EUR ripartita in fasce di pagamento di 500 mila EUR;

TABLE F pursuant to Art. 450, paragraph 1(j): information on total remuneration12

12 The information refers to the corporate offices of Banca Mediolanum S.p.A.

Componente Fissa Componente variabile Totale

Presidente Organo con funzione di

supervisione strategica1 € 600.000 € - € 600.000

Amministratore Delegato 1 € 1.109.615 € 284.000 € 1.393.615

Direttore Generale 1 € 474.161 € 198.800 € 672.961

Condirettori Generali -

Vice Direttori Generali -

Categorie

Remunerazione complessiva

N°

Ciascun membro Organo con funzione di gestione:

ANNEX 1 REMUNERATION POLICIES – PARAGRAPH 6.2 - Bonus calculation method

Below are the calculation criteria for bonuses.

1. Bonus – Portfolio Value

The portfolio benefits are calculated applying the parameters given in the annexed table to the assets

managed as of the last available survey for the clients in the portfolio as of the date of transfer.

The calculation of the value of each individual client will be made applying the values and criteria set in the

current table on the date of valuation.

The total of the Portfolio Benefits will be determined by the sum of the portfolio unit values for the clients

for which there are one or more agents willing to purchase the relative portfolio for a price.

The agents may negotiate a different transfer value for the portfolio on the condition of specific approval

from the bank.

Regarding clients with a high number of assets (so-called, important clients) or clients that by effect of

application of the values and criteria set in the current table at the date of valuation have a unit value more

or less over €100,000, as an alternative the parties may agree that the transfer shall be settled in advance

in the amount equal to the management commissions (management fee plus any surcharge) actually due

to the recipient agent in the 36 months after the reassignment date. If the agency contract terminates due

to death of the agent or withdrawal of the Bank or the agent due to permanent total disability, as an

exception to that set forth, settlement shall be established solely in advance in the amount equal to the

management commissions (management fee plus any surcharge) actually due to the recipient agent in the

36 months after the reassignment date.

Following is the table with the valuation rules in effect.

Class Product Parameter Parameter

(a) (b)

BANK Savings accounts and

Obligations

0.10% 0.10%

Bank Accounts 0.25% 0.25%

Mortgages and loans

(residual value)

0.25% 0.25%

Share Deposit and Structured

Products

0.25% 0.25%

FUNDS Monetary Funds 0.80% 0.80%

Other Funds 1.10% 1.30%

Asset Management 1.10% 1.30%

Index-Linked Life Insurance 0.25% 0.25%

Unit Linked 1.10% 1.30%

Other life insurance

policies (*)

1.10% 1.30%

Protection (**) 1.10% 1.30%

(*) Previgest is included in the valuation solely for the Individual Pension Plan types

(**) Premiums last 12 months for 20 annuities not including the CPI policies

(a) Portfolio with AUM Below €30 million

(b) Portfolio with AUM equal to at least €30 million

2. Bonus – Structure Benefits

The Structure Benefits are calculated exclusively on the indirect commissions (so-called “Overs”) earned by

the agents for the structure assigned to him by the bank, therefore not including direct commissions.

The Structure Benefits will be calculated by summing the management fee overs from the last available

month and the monthly average of the overs from front fees earned in the 12 months prior to termination

of the agency contract or transfer of the structure, multiplied by 36.

The Structure Benefits are calculated based on the resulting values at the end of the month prior to the

date of request for structure variation.

The manager agents may negotiate a different transfer value for the structure on the condition of specific

approval from the bank.

3. Bonus – Manager Financial Advisor Benefits

The Manager Financial Advisor Benefits are calculated exclusively on the indirect commissions (so-called

«Over») earned by the agent for the structures for which he or she carries out supervision, assistance, and

coordination activity, not including direct commissions.

For Manager Consultants in business as of January 1, 2015, the Manager Consultant Benefits are calculated:

a) taking the benefits value as of December 31, 2014, for the overs accrued that same year as the

base of the calculation;

b) adding or subtracting from the value under point a) the increases/decreases of the average monthly

over from management fees earned in the 12 months prior to the end of the assignment (as Manager

Consultant) over the average of the monthly overs for the year of reference under the point above, and

multiplying that difference by a coefficient of 36.

For manager consultants with structures assigned starting from January 1, 2015, the Manager Consultant

Benefits will be calculated on the increase/decrease between the monthly average of commissions from the

last 12 sliding months prior to the end of the Consultants Manager assignment (if less than a year, the

average of the overs of the actual months worked will be calculated), and the overs generated the first

month of the assignment multiplied by a coefficient of 36.

Banca Mediolanum S.p.A. Board of Directors’ Report on the ... · remuneration policies consistent...

Documents

Transcript of Banca Mediolanum S.p.A. Board of Directors’ Report on the ... · remuneration policies consistent...