Quarterly

Consolidated Report to 30th September 2006

Joint stock co-operative society Head Office and General Management: Piazza Vittorio Veneto 8, Bergamo (Italy)

Member of the Interbank Deposit Protection Fund and the National Guarantee Fund Tax Code, VAT No. and Registration No. in the Company Register of Bergamo 03053920165

ABI No. 05026.0 Register of Banks No. 5559 Register of Banking Groups No. 5026.0 Share capital at 30th September 2006: Euro 861.134.525,00 fully paid up

www.bpubanca.it

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Contents Corporate Boards, Management and Independent Auditors of BPU Banca.......................p. 3

The consolidation area ..............................................................................................................p. 4 The Structure of the Banche Popolari Unite Group as at 30th September 2006 .................p. 10

The Rating .................................................................................................................................p. 12 RECLASSIFIED CONSOLIDATED ACCOUNTS AND RECONCILIATIONS................................................p. 13

Principal Group indicators .......................................................................................................p. 20 NOTES AND COMMENTS ON CONSOLIDATED OPERATIONS .........................................p. 21

• The macroeconomic scenario .........................................................................................p. 23 • Branch network of the Banche Popolari Unite Group .............................................p. 25 • The distribution network and the positioning of the Group .......................................p. 26 • Group human resources ................................................................................................p. 29 • Strategic lines of development .......................................................................................p. 32 • Information on risks and hedging policies ..............................................................p. 35 • Traditional banking activities ........................................................................................p. 37

- Direct funding ...............................................................................................................p. 37 - Indirect funding and assets under management .............................................................p. 40 - Lending .........................................................................................................................p. 42

• The interbank market .....................................................................................................p. 45

• Financial activities ..........................................................................................................p. 46 • Equity investments ................................................................................................p. 51 • Tangible and intangible assets ...............................................................................p. 52 • Non current assets/liabilities held for disposal.......................................................p. 56 • Provisions for liabilities and charges.......................................................................p. 57 • The income statement ....................................................................................................p. 58 • Shareholders’ equity and capital adequacy ..................................................................p. 65 • Information on share capital, the shares, dividends paid

and earnings per share ..........................................................................................p. 70 • Data on the main companies in the BPU Banca Group ..............................................p. 74 • Consolidated results by segment ............................................................................p. 77 • The performance of the principal consolidated banks .............................................p. 79

- Banca Popolare di Bergamo Spa .....................................................................................p. 79 - Banca Popolare Commercio e Industria Spa....................................................................p. 81 - Banca Popolare di Ancona Spa .......................................................................................p. 83 - Banca Carime Spa..........................................................................................................p. 85 - Centrobanca Spa............................................................................................................p. 87

• Transactions with related parties ...........................................................................p. 89 • Other information ..................................................................................................p. 94 • Important events occurring after 30th September 2006...........................................p. 97 • Likely future developments for consolidated operations..........................................p. 102

ACCOUNTING POLICIES AND CONSOLIDATED ANNUAL ACCOUNTS TO 30TH SEPTEMBER 2006 ............p. 103

• Accounting policies ................................................................................................p. 105 • Consolidated annual accounts to 30th September 2006 ..........................................p. 109

- Consolidated balance sheet ............................................................................................p. 110 - The consolidated income statement ................................................................................p. 112 - Statement of changes in consolidated shareholders’ equity as at 30th September 2006....p. 113 - Statement of changes in consolidated shareholders’ equity as at 30th September 2005....p. 114 - Consolidated statement of cash flows .............................................................................p. 115

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• Consolidated financial statements: comparison figures...............................................p. 117 INFORMATION ON THE PERFORMANCE OF THE PARENT BANK IN THE FIRST NINE MONTHS OF 2006 ....p. 121

• BPU Banca: performance in the period...................................................................p. 122 • BPU Banca: financial statements to 30th September 2006............................................p. 125

- Balance sheet.................................................................................................................p. 126 - Income statement...........................................................................................................p. 128 - Statement of changes in shareholders’ equity as at 30th September 2006........................p. 129 - Statement of changes in shareholders’ equity as at 30th September 2005........................p. 130 - Statement of cash flows.................................................................................................p. 131

Legend

The following conventions are used in the tables: - dash (-): when the item does not exist; - not significant (n.s.): when the figure is insufficient to reach the minimum level in question or is in

any case not significant; - not available (n.a.): when the information is not available.

All figures are given in thousands of euros, where not indicated otherwise.

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BPU Banca Honorary Chairman Giuseppe Vigorelli

Corporate Boards, Management and Independent Auditors Board of Directors Chairman * Emilio Zanetti Senior Deputy Chairman * Giuseppe Calvi Deputy Chairman * Mario Boselli Deputy Chairman * Antonio Bulgheroni Managing Director * Giampiero Auletta Armenise Enzo Berlanda Gaudenzio Cattaneo Enio Fontana * Giorgio Frigeri Carlo Garavaglia Italo Lucchini Gregorio Magnetti * Members of the Executive Committee * Mario Mazzoleni * Toti S. Musumeci Sergio Orlandi * Alessandro Pedersoli Giorgio Perolari Carlo Pesenti Carlo Porcari Emilio Riva Roberto Sestini Secretary Alfredo Gusmini

Statutory board of auditors Chairman Luigi Guatri Fulvio Albini Rodolfo Luzzana Giovanni Napodano Pecuvio Rondini Alternates Adalberto Bottazzoli Giovanni Martinelli

Board of arbitration Chairman Giampiero Donati Mario Caffi Giovanni Lega Alternates Attilio Rota Emilio Usuelli

General Management General Manager Alfredo Gusmini Deputy General Manager Graziano Caldiani Deputy General Manager Francesco Iorio Deputy General Manager Renzo Parisotto Deputy General Manager Giorgio Ricchebuono Deputy General Manager Pierangelo Rigamonti Deputy General Manager Giancesare Toffetti

Independent Auditors KPMG Spa

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The consolidation area The companies that formed part of the consolidation area at 30th September 2006 are listed below, divided into subsidiaries (fully consolidated), companies subject to joint control (proportionally consolidated) and associates (consolidated using the equity method). The percentage of control or ownership attributable to the Group (direct or indirect), their headquarters (registered address or operating headquarters) and the share capital is also indicated for each of them. Fully consolidated companies (control is by the Parent Bank of the Group where no other indication is given):

1. Banche Popolari Unite Scpa – BPU Banca (Parent Bank) registered address: Bergamo, Piazza Vittorio Veneto, 8 – share capital: 861.134.525 euro

2. Banca Popolare di Bergamo Spa (100% controlled) registered address: Bergamo, Piazza Vittorio Veneto, 8 – share capital: 1.256.300.000 euro

3. Banca Popolare Commercio e Industria Spa (83,3610% controlled) registered address: Milano, Via della Moscova, 33 – share capital: 682.500.000 euro

4. Banca Popolare di Ancona Spa (99,2279% controlled) registered address: Jesi (Ancona), Via Don A. Battistoni, 4 – share capital: 122.254.095 euro

5. Banca Popolare di Todi Spa (98,0948% controlled by BPA Spa) registered address: Todi (Perugia), Piazza del Popolo, 27 – share capital: 2.562.000 euro

6. Banca Carime Spa (85,8226% controlled) registered address: Cosenza, Viale Crati snc – share capital: 1.468.208.505,92 euro

7. Banque de Dépôts et de Gestion Sa (100% controlled by BDG Finanziaria Sa – Switzerland) registered address: Avenue du Théâtre, 14 – Lausanne (Switzerland) – share capital: 10.000.000 Swiss francs

8. BPU Banca International SA (99,9975% controlled and Centrobanca Spa holds a 0,0025% registered address: 13 Rue Beaumont - Luxembourg – share capital: 40.000.000 euro

9. B@nca 24-7 Spa (100% controlled) operating headquarters: Bergamo, Via A. Moretti, 11 – share capital: 100.000.000 euro

10. IW Bank Spa (51% controlled by Centrobanca Spa and the Parent Bank holds a 20% interest) registered address: Milano, Via Cavriana, 20 – share capital: 15.140.725 euro

11. BPU Società di Intermediazione Mobiliare Spa (100% controlled) operating headquarters: Milano, Via Monte Rosa, 93 – share capital: 15.450.000 euro

12. Centrobanca Spa (92,3515% controlled and BPA holds a 5,4712% interest) registered address: Milano, Corso Europa, 16 – share capital: 369.600.000 euro

13. Centrobanca Sviluppo Impresa SGR Spa (100% controlled by Centrobanca) registered address: Milano, Corso Europa, 16 – share capital: 2.000.000 euro

14. FinanzAttiva Servizi Srl (50% is held by FinanzAttiva Sim Spa and 50% by BPU Pramerica SGR) operating headquarters: Milano, Piazzale f.lli Zavattari, 12 – share capital: 5.660.000 euro

15. BPU Pramerica SGR Spa (51,7205% controlled and 12,9870% held by BPA and 0,2925% by BPT) operating headquarters: Milano, Piazzale f.lli Zavattari, 12 – share capital: 13.157.900 euro

16. BPU Pramerica Alternative Investments SGR Spa (100% controlled by BPU Pramerica SGR) operating headquarters: Milano, Piazzale f.lli Zavattari, 12 – share capital: 5.000.000 euro

17. BPU Partecipazioni Assicurative Spa (85% controlled and 15% held by BPA) registered address: Milano, Piazzale f.lli Zavattari, 12 – share capital: 99.654.000 euro

18. BPU Assicurazioni Spa (100% controlled by BPU Partecipazioni Assicurative) registered address: Milano, Piazzale f.lli Zavattari, 12 – share capital: 22.880.000 euro

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19. BPU Assicurazioni Vita Spa (100% controlled by BPU Partecipazioni Assicurative) registered address: Milano, Piazzale f.lli Zavattari, 12 – share capital: 49.721.776 euro

20. BPU Mediazioni Assicurative Srl (88% controlled) registered address: Bergamo, Via f.lli Calvi, 15 – share capital: 1.560.000 euro

21. BPU Esaleasing Spa (61,7262% and 38,2738% held by BPA)1 registered address: Bergamo, Via f.lli Calvi, 15 – share capital: 49.427.991 euro

22. BPB Immobiliare Srl (100% controlled) registered address: Bergamo, Piazza Vittorio Veneto, 8 – share capital: 185.680.000 euro

23. Immobiliare BPU Srl (16,38% held by the Parent Bank, 36,95% held by Banca Carime and 46,67% by BPB Immobiliare) registered address: Bergamo, Piazza Vittorio Veneto, 8 – share capital: 1.520.000 euro

24. BDG Finanziaria Sa (100% controlled) registered address: Soazza-Grigioni (Switzerland) – share capital: 9.000.000 Swiss francs

25. BPB Funding Llc (100% controlled) registered address: One Rodney Square, 10th floor, Tenth and King Streets, Wilmington, New Castle County, Delaware, USA – share capital: 1.000.000 euro

26. BPB Capital Trust (100% controlled by BPB Funding Llc – USA) registered address: One Rodney Square, 10th floor, Tenth and King Streets, Wilmington, New Castle County, Delaware, USA – share capital: 1.000 euro

27. BPCI Funding Llc (100% controlled) registered address: One Rodney Square, 10th floor, Tenth and King Streets, Wilmington, New Castle County, Delaware, USA – share capital: 1.000.000 euro

28. BPCI Capital Trust (100% controlled by BPCI Funding Llc – USA) registered address: One Rodney Square, 10th floor, Tenth and King Streets, Wilmington, New Castle County, Delaware, USA – share capital: 1.000 euro

29. Plurifid Spa (100% controlled) registered address: Torino, Via V. Alfieri, 17 – share capital: 390.000 euro

30. Mercato Impresa Spa (100% controlled) registered address: Milano, Via G. Verdi, 6 – share capital: 3.500.000 euro

31. Coralis Rent Srl (100% controlled by Mercato Impresa) registered address: Milano, Via G. Verdi, 6 – share capital: 400.000 euro

32. BPU Centrosystem Spa (100% controlled)2 registered address: Milano, Via Meravigli, 12/14 – share capital: 516.600 euro

33. Albenza Srl3 34. Albenza 2 Srl3 35. Albenza 3 Srl3 36. Orio Finance Nr. 1 Plc3 37. Orio Finance Nr. 2 Plc3 38. Orio Finance Nr. 3 Plc3 39. Sintonia Finance Srl3

1 The merger of Esaleasing Spa into BPU Leasing Spa was completed on 8th July 2006 with the adoption of a new

name, BPU Esaleasing Spa. 2 An Extraordinary General Meeting of 31st July 2006 changed the name of the company from Centrosiel Spa to BPU

Centrosystem Spa. 3 Albenza Srl, Albenza 2 Srl, Albenza 3 Srl, Orio Finance Nr. 3 Plc and Sintonia Finance Srl: special purpose vehicles

formed in compliance with Law No. 130/1999 for the securitisations performed between 1999 and 2003 by the former BPB-CV Srl (Albenza Srl, Albenza 2 Srl, Albenza 3 Srl), by BPU International Finance Plc Ireland, now closed, (Orio Finance Nr. 1 Plc, Orio Finance Nr.2 Plc, Orio Finance Nr. 3 Plc) and by Centrobanca (Sintonia Finance Srl). They were included in the consolidated accounts because these companies are in reality controlled, since their assets and liabilities were originated by Group member companies. As concerns Sintonia Finance, given that the securitisation was multioriginator only those assets and liabilities relating to the operation originated by Centrobanca were consolidated. The consolidation only concerns those assets subject to securitisation and the relative liabilities issued.

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Companies consolidated using the proportional method (the investment is by the Parent Bank where no other indication is given):

1. BPU Trust Company Ltd (99,9980% controlled by BPU Banca International Sa - Luxembourg) registered address: Esplanade, 44 – St. Helier, Jersey (Great Britain) – share capital: 50.000 UK sterling

2. BY YOU Spa (formerly Rete Mutui Italia Spa, 40% controlled) 4 registered address: Milano, Corso Vittorio Emanuele II, 15 – share capital: 650.000 euro

3. Polis Fondi SGRpA (9,8% controlled)5 registered address: Milano, Via Gonzaga, 7 – share capital: 5.200.000 euro

Companies consolidated using the equity method (the investment is by the Parent Bank where no other indication is given):

1. Aviva Vita Spa (50% controlled) registered address: Milano, Viale Abruzzi, 94 – share capital: 35.000.000 euro

2. Secur Broker Srl (10% held by the Parent Bank 30% by BPU Mediazioni Assicurative) registered address: Bergamo, Via f.lli Calvi, 15 – share capital: 46.800 euro

3. SF Consulting Srl (35% controlled) operating headquarters: Milano, Piazzale f.lli Zavattari, 12 – share capital: 93.600 euro

4. Sofipo Fiduciaire Sa (30% controlled by BDG Finanziaria Sa - Switzerland) registered address: Via Balestra, 22B - Lugano (Switzerland) – share capital: 2.000.000 Swiss francs

5. Arca SGR Spa (23,1240% held by the Parent Bank and 3,5840% by BPA) registered address: Milano, Via M. Bianchi, 6 – share capital: 50.000.000 euro

6. S.P.F. Studio Progetti Financial Srl (25% interest held by BPA) registered address: Roma, Via Nazionale, 243 – share capital: 92.960 euro

7. Group Srl (22,5% interest held by Centrobanca Spa) registered address: Milano, Via Borgonuovo, 27 – share capital: 80.000 euro

8. Capital Money Spa (a 20% interest is held) registered address: Milano, Via Losanna, 16 – share capital: 1.200.000 euro

There have been no modifications in the consolidation area compared to 30th June 2006,6 if exception is made for changes in the percentage of shares owned, summarised below, for the formation of two new companies, the disposal of the tax collection companies (previously included among asset groups held for disposal) and some merger operations between companies included in the consolidation already programmed in the original Industrial Plan and the updates to it. Furthermore, the percentage interest held by the Group in this industrial joint venture BY YOU Spa amounted to 40% at the end of September (compared to 20% as at 30th June 2006) following the inclusion of the effects of a preliminary binding agreement signed on 3rd August and a subsequent final agreement signed on 5th October 2006, designed to strengthen, consolidate and maximise the company’s level of performance. In addition to options providing guarantees for the parties to the agreement (BPU Banca and all the remaining shareholders of By You), these also contained four put options (each amounting to 5% of the share capital with an exercise price of 3,25 million each), to be exercised when defined objectives are achieved. The above mentioned 40% ownership has already been recognised in the accounts because it

4 The company holds 100% of: By You Piemonte Srl, By You Liguria Srl, By You Mutui Srl, By You Adriatica Srl, By

You Nord Srl, By You Centro Srl and By You Sud Srl, all proportionally consolidated within the Group. 5 Polis was included in the consolidation using the proportional method because joint control emerged following the

signing on 18th October 2005 of both a shareholders agreement to stabilise the ownership structure and of a shareholders syndicate agreement accounting for 51% of the share capital to which the parties are bound for three years.

6 See the consolidated interim half year report to 30th June 2006 for a comment on changes in the composition of the consolidation with respect to 31st December 2005.

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was considered that there was a very high probability of it being reached given the underlying circumstances. The new shareholders agreement, which replaces the previous agreement signed on 2nd September 2005, also specified, amongst other things, a maximum consideration of 18 million which includes, not only the four put options already mentioned but also a final payment for a maximum of 5 million if a further objective is reached. Changes in the percentage of the shares held that occurred in the third quarter of 2006

Banca Carime Spa: BPU Banca acquired small quantities of shares from minority shareholders (a total of 0,0006% of the share capital), bringing the controlling interest at the end of September to 85,8226% (85,822% at the end of the first half);

Banca Popolare di Ancona Spa: again in the third quarter the Parent Bank purchased small quantities of shares amounting to 0,0096% of the share capital increasing its controlling interest to 99,2279% (99,2183% in June 2006). These transactions took place on the “Alternative Trading System” of financial instruments issued by BPA Spa (Art. 78, Legislative Decree No. 58/1998 and Consob Authorisation No.14035/2003);

Company mergers performed in the third quarter of 2006

the merger of Investimenti Piccole Imprese Spa into Centrobanca Spa: the operation was concluded on 29th August 2006 (recorded in the register of companies on 31st August 2006, with effect for accounting and tax purposes from 1st January 2006) and consequently IPI Spa was no longer included in the consolidation as at 30th September 2006. The merger forms part of the 2005-2007 Industrial Plan, which requires the centralisation in Centrobanca of all investment banking activities for the corporate market (IPI operates at the service of small companies with a turnover of up to 15 million euro);

the merger of Esaleasing Spa into BPU Leasing Spa, with the change of the company’s name at the same time to BPU Esaleasing Spa. The operation took effect from 8th July 2006 and has effect for accounting and tax purposes from 1st January 2006. The merger forms part of the reorganisation of the leasing segment provided for in the Industrial Plan and was preceded by progressive integration action started in 2004 with the IT unification of the front end and back office systems of the two companies, which then continued in 2005 with evolution towards a single commercial model focused on the banking channel to achieve standardisation of the internal organisations.

Disposal of the tax collection companies

As a consequence of Decree Law No. 203/2005, converted into Law No. 248/2005, from 1st October 2006 the tax authorities may only collect national taxes through the company Riscossione Spa, formed in 2005, in which the tax authority and INPS (national insurance institute) hold interests and the tax concessions that were held by, amongst others, the subsidiaries Bergamo Esattorie Spa and Ancona Tributi Spa, have therefore lapsed. This persuaded the Banche Popolari Unite Group to sell these subsidiaries to Riscossione Spa. After preliminary contracts were signed on 24th May 2006, final contracts were signed on 21st September 2006 between Banche Popolari Unite Scpa (BPU) and Riscossione Spa for the sale of 100% of the investment in Bergamo Esattorie Spa and between Banca Popolare di Ancona Spa (BPA) and Riscossione Spa for the sale of 100% of the investment in Ancona Tributi Spa, where the transfer of the subsidiaries took effect from 30th September 2006.

These final contracts, which also complied with the cited Decree Law No. 203/2005, specified that: a) the consideration for the sale (which will be determined by 28th February 2007) will be

equal to the net assets of the tax collection companies, as resulting from the accounts on the disposal date of 30th September 2006 following an audit performed by a special auditor appointed by common agreement between the parties concerned as an arbitrator within the meaning of articles 1349 and 1473 of the Italian Civil Code;

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b) the consideration is not paid by Riscossione Spa to the sellers (BPU and BPA), but constitutes credit against what the latter owe for the purchase of minority interests in Riscossione Spa;

c) these interests will be repurchased by the public sector shareholders of Riscossione Spa (at present the tax authority and the INPS – national insurance institute), or by public sector entities nominated by these, not later than 31st December 2010, at a predetermined price based on the consideration mentioned under point (a).

Given the above, amounts due from Riscossione Spa were recognised in the accounts as at 30th September 2006 against the disposals for an amount equal to the net assets in the balance sheets of the tax collection companies as at 30th June 2006 (having also taken account of a positive outcome of the due diligence investigation into operating, capital and legal aspects reported by Riscossione Spa on 19th July 2006) plus the results of those companies for the third quarter of 2006. The formation of two new companies

Coralis Rent Srl: this company (fully controlled by Mercato Impresa and an operating instrument of it) was formed on 27th July to provide long term automobile leasing services. This service is targeted at private individuals, self-employed professionals and companies. In return for a fixed monthly charge it combines better value for money compared to direct ownership of an automobile, with simplified management and the possibility of selecting optional extras and choosing the type and fittings of the vehicle, the life of the lease (12-60 months) and the estimated mileage (up to 150.000 km);

BPU Pramerica Alternative Investments SGR Spa: this company, fully controlled by BPU Pramerica SGR, was formed on 15th September 2006 and is waiting to be registered with the Bank of Italy as an asset management company. It will manage speculative funds (hedge funds) and will operate with a view to maximising synergies with its parent, allowing the Group to occupy a new market segment, thereby broadening its range of products and consolidating its presence in the asset management industry. Given the time required to obtain the necessary authorisation for BPU Pramerica Alternative Investments SGR to commence operating, it is presumed that the first hedge funds will be available for sale at the end of March 2007.

Operations currently in progress:

the merger of Immobiliare BPU Srl into BPB Immobiliare Srl, the plan for which was approved by the respective boards of directors on 4th October 2006, will be examined by shareholders’ meetings convened for 17th November 2006. It will have effect for accounting and tax purposes with effect from 1st January 2006. The operation forms part of the rationalisation action provided for under the 2006-2008 Industrial Plan and it is designed to concentrate the management of the Group’s non business properties in a single company. From a technical viewpoint, the operation involves an initial phase for the purchase by BPB Immobiliare of the interests held by BPU Banca (16,38%) and by Banca Carime (36,95%) in Immobiliare BPU and the subsequent merger of the latter into BPB Immobiliare. The sales of the interests mentioned above, held by the Parent Bank and by Carime, to BPB Immobiliare were concluded on 30th October 2006. The total value of the company merged, use to define the transfer values, amounted to 25,6 million euro and was determined by an external appraiser since transactions between related parties were involved. Total control of the company allowed a simplified procedure to be adopted since there was no swap rate or settlement of a balance and the implementation of the merger will not cause any increase in the share capital of the merging company and the entire share capital of the company being merged will simply be cancelled. The operation is expected to be concluded in December;

the merger of Banca Popolare di Todi Spa into Banca Popolare di Ancona Spa, the plan for which was approved by the respective boards of directors on 11th September 2006, received final approval on 7th November 2006 from both an Extraordinary General Meeting of the Shareholders of BPT and the Board of Directors of BPA (in accordance with Art. 2505 of the

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Italian Civil Code and Art. 23 of the Corporate Statute). The operation will take place next December and will have effect for accounting and tax purposes with effect from 1st January 2006. In addition to an ownership structure in which the merging company (more than 99% controlled by the Parent Bank) controls the merged company, BPT, with an interest of more than 98%, the merger plan was based on considerations of a strategic and industrial nature: - the size of Banca Popolare di Todi; - the achievement of clear economies of scale from the centralisation of activities, while at

the same time enhancing of the value of its roots in local markets by forming, amongst other things, a local committee to promote the image of the bank in the local community and by creating a local retail area located at Todi;

- further savings on administrative and corporate expenses connected with the existence of a single legal entity.

From an ownership viewpoint the operation will take place with an increase in the share capital by BPA to service the share swap; the latter was calculated (on the basis of an appraisal performed by an external expert appointed by both the companies) at 11 BPA shares with a nominal unit value of 5 euro for each BPT share with a nominal value of 30 euro. This will involve the issue of 17.897 new shares with a nominal value of 5 euro each reserved to the shareholders of the merged company other than the merging company with a total nominal value of 89.485 euro. The post merger share capital of BPA will therefore amount to 122.343.580 euro and BPU Banca will hold a controlling interest of 99,16%.

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The Structure of the Banche Popolari Unite Group at 30th September 2006

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The Rating The tables given below summarise the ratings assigned to Group by the international agencies, STANDARD & POOR’S, MOODY’S and FITCH RATINGS. On 17th January 2006, Standard & Poor’s upgraded the outlook from stable to positive to reflect ongoing improvement in profitability and reduced risks in lending activities. On 18th July 2006 Fitch Ratings raised all its main ratings, confirming the individual and the support rating, while the outlook remained stable. These changes reflect improved profitability, capitalisation and quality of the Group’s assets made possible by the acceleration of the integration process.

(i) Indicates the capacity to repay debt maturing in less than 1 year.

(A-1: best rating – D: worst rating)

(ii) With reference to debt maturing in more than 1 year, indicates the capacity to pay interest and repay principal, together with any sensitivity to the adverse effects of changes in circumstances or economic conditions (AAA: best rating – D: worst rating)

(I) Long-term debt (maturing in 1 year or more), investment grade

(Aaa: prime quality – Baa3: medium quality).

(II) Short term (maturing in less that 1 year) (Prime-1: highest quality – Not Prime: speculative grade)

(III) This rating does not refer to the punctuality of payments but indicates the possibility that the bank will need external support from shareholders, the group to which it belongs or official institutions

(A: best rating – E: worst rating).

(1) Indicates the capacity to repay debt maturing in the short term (duration of less than 13 months) (F1: best rating – D: worst rating)

(2) Reflects the capacity to meet financial commitments in the long term, independently of the maturity of individual bonds. This rating is an indicator of the probability that an issuer will default. (AAA: best rating – D: worst rating)

(3) This rating represents a kind of assessment of a bank’s intrinsic soundness (profitability, balance-sheet strength, ability of the management, operational environment, commercial network), on the assumption that the bank cannot rely on external support (possible intervention by a lender of last resort, support from shareholders, etc.). (A: best rating - E: worst rating)

(4) Indicates the Fitch rating on the possibility of concrete and timely external support (from the state or large institutional investors) if the bank finds itself in difficulty. (1: best rating – 5: worst rating).

STANDARD & POOR’S

Short-term Counterparty Credit Rating (i) A-2Long-term Counterparty Credit Rating (ii) A–Outlook PositiveRATINGS ON ISSUESSenior unsecured debt A–Short-term debt A-2Subordinated debt BBB+Preference shares BBBTier III subordinated debt BBB-

MOODY'S

Long-term debt and deposit rating (I) A2Short-term debt and deposit rating (II) Prime-1Financial strength rating (III) C+Outlook StableRATINGS ON ISSUESSenior unsecured LT A2Senior unsecured ST P-1Upper/Lower Tier II subordinated A3Tier III subordinated Baa1Preference shares (former BPB-CV) Baa1

FITCH RATINGS

International Short-term Credit Rating (1) F1Issuer Default Rating (2) ABank Individual Rating (3) B/CSupport Rating (4) 3Outlook on Issuer Default Rating StableRATINGS ON ISSUESSenior debt AUpper/Lower Tier II subordinated A-Preference shares (former BPCI) A-Tier III subordinated debt BBB+

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RECLASSIFIED CONSOLIDATED ACCOUNTS AND RECONCILIATIONS

Comparison figures The figures reported in the reclassified statements constitute basis for all the comments that follow (except when specified otherwise). In order to allow a uniform comparison with the figures at 30th September 2006, as with the Consolidated Half Year Report to 30th June 2006, the figures for the previous periods have been appropriately reclassified and adjusted as follows:

the balance sheet and income statement figures as at 30th September 2005 have been reclassified to take account of the following: - the classification of the tax collection companies, on the basis of IFRS 5, under

assets/liabilities held for disposal; - the reclassification under ordinary assets/liabilities of Centrosiel (now BPU Centrosystem),

previously recognised under assets/liabilities held for disposal which, as a result of the changed strategic policy, was not disposed of;

the income statement figures for the first quarter and the first half of 2005 have been restated on a

pro-forma basis to take account of the following: - the disposal of Carifano in July 2005; - the classification of the tax collection companies under assets/liabilities held for disposal; - the reclassification under ordinary items, with regard to 30th June 2005, of Centrosiel (now

BPU Centrosystem); - the attribution to the second quarter instead of the first of the gain amounting to 4,6 million

euro on the disposal of the interest held in Arca Merchant.

The income statement figures for the first half of 2005 have been adjusted for accounting differences that emerged subsequent to the date of approval of the Half Year Report to 30th June 2005 and which were reported in the Quarterly Report to 30th September 2005;

the balance sheet and income statement figures as at 31st December 2005 have been reclassified

to take account of the tax collection companies classified under assets/liabilities held for disposal; The balance sheet and income statement figures for the previous periods, as with the mandatory schemes, adopt a few more precise classifications resulting mainly from the application of the Bank of Italy Circular No. 262 of 22nd December 2005.

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Reclassified consolidated balance sheet

Figures in thousands of euroabsolute % absolute %

ASSETS10 Cash and cash equivalents 288.059 373.697 -85.638 -22,9% 260.897 27.162 10,4%

20+30 Financial assets held for trading at fair value 8.346.864 7.367.106 979.758 13,3% 6.987.925 1.358.939 19,4%

40 Available-for-sale financial assets 3.552.858 3.721.162 -168.304 -4,5% 3.329.610 223.248 6,7%

50 Held-to-maturity financial assets 1.227.145 1.061.634 165.511 15,6% 998.965 228.180 22,8%

60 Loans to banks 1.907.591 3.321.395 -1.413.804 -42,6% 4.115.040 -2.207.449 -53,6%

70 Loans to customers 49.798.318 47.300.815 2.497.503 5,3% 44.918.972 4.879.346 10,9%

80 Hedging derivatives 186.238 205.256 -19.018 -9,3% 265.100 -78.862 -29,7%

90Fair value change in financial assets subject to macro-hedge (+/-) 10.288 29.331 -19.043 -64,9% 41.804 -31.516 -75,4%

100 Equity investments 46.738 32.859 13.879 42,2% 42.770 3.968 9,3%

110 Technical reserves of reinsurers 98.773 104.146 -5.373 -5,2% 106.035 -7.262 -6,8%

120 Tangible assets 1.348.157 1.377.393 -29.236 -2,1% 1.363.714 -15.557 -1,1%

130 Intangible assets 1.259.704 1.237.046 22.658 1,8% 1.222.561 37.143 3,0%

of which: goodwill 1.209.622 1.195.299 14.323 1,2% 1.190.466 19.156 1,6%

140 Tax assets 573.229 704.660 -131.431 -18,7% 875.639 -302.410 -34,5%

150 Non current assets and disposal groups held for sale- 174.430 -174.430 -100,0% 60.220 -60.220 -100,0%

160 Other assets 1.542.564 1.852.704 -310.140 -16,7% 1.823.940 -281.376 -15,4%

Total assets 70.186.526 68.863.634 1.322.892 1,9% 66.413.192 3.773.334 5,7%

LIABILITIES10 Due to banks 6.607.514 6.366.914 240.600 3,8% 5.046.288 1.561.226 30,9%

20 Due to customers 29.607.923 29.370.331 237.592 0,8% 28.813.075 794.848 2,8%

30 Securities issued 22.537.901 20.925.250 1.612.651 7,7% 20.850.925 1.686.976 8,1%

40+50Financial liabilities held for trading e valutate at fair value 449.994 348.941 101.053 29,0% 409.504 40.490 9,9%

60 Hedging derivatives 320.679 321.093 -414 -0,1% 245.240 75.439 30,8%

80 Tax liabilities 526.596 620.861 -94.265 -15,2% 892.729 -366.133 -41,0%

90Liabilities associated with disposal groups held for sale - 83.019 -83.019 -100,0% 38.305 -38.305 -100,0%

100 Other liabilities 1.683.919 2.772.170 -1.088.251 -39,3% 2.221.578 -537.659 -24,2%

110 Staff severance payments 342.700 350.052 -7.352 -2,1% 351.668 -8.968 -2,6%

120 Provisions for liabilities and charges: 337.037 331.439 5.598 1,7% 354.564 -17.527 -4,9%

a) pension and similar obligations 156.645 163.138 -6.493 -4,0% 165.328 -8.683 -5,3%

b) other provisions 180.392 168.301 12.091 7,2% 189.236 -8.844 -4,7%

130 Technical reserves 2.473.415 2.247.693 225.722 10,0% 2.246.493 226.922 10,1%

170+180+190 Capital, issue premiums and reserves 4.384.028 4.028.353 355.675 8,8% 3.945.498 438.530 11,1%

210 Minority interests 405.743 416.658 -10.915 -2,6% 403.645 2.098 0,5%

220 Profit for the period 509.077 680.860 n.s. n.s. 593.680 -84.603 -14,3%

Total liabilities 70.186.526 68.863.634 1.322.892 1,9% 66.413.192 3.773.334 5,7%

30.9.2006A

Changes A/B Changes A/C31.12.2005pro-forma

B

30.9.2005pro-forma

C

15

Figures in thousands of euroabsolute %

10-20 Net interest income 1.199.991 1.142.082 57.909 5,1% 404.352 380.321 1.531.797

70 Dividend and similar income 10.355 9.032 1.323 14,6% 867 443 10.183

Profit (loss) of equity investments valued using the equity method 5.971 5.337 634 11,9% 2.743 1.024 5.060

40-50 Net commission income 609.785 579.318 30.467 5,3% 185.673 200.046 779.541

80+90+100+110

Net profit (loss) from trading, hedging and disposal/repurchase activities 154.567 117.876 36.691 31,1% 22.877 35.950 175.743

150-160 Net income on insurance operations 45.382 49.425 -4.043 -8,2% 11.252 15.395 66.910

220 Other net operating income / (expense) 43.023 60.141 -17.118 -28,5% 12.927 12.482 73.126

Operating income 2.069.074 1.963.211 105.863 5,4% 640.691 645.661 2.642.360

180a Staff costs -754.412 -755.014 -602 -0,1% -239.786 -255.263 -1.017.923

180b Other administrative expenses -300.003 -307.348 -7.345 -2,4% -97.463 -96.875 -410.111

200+210Net impairment losses on tangible and intangible assets -88.495 -78.489 10.006 12,7% -32.500 -27.435 -113.565

Operating costs -1.142.910 -1.140.851 2.059 0,2% -369.749 -379.573 -1.541.599

Net operating income 926.164 822.360 103.804 12,6% 270.942 266.088 1.100.761

130a Net impairment losses on loans-116.234 -131.520 -15.286 -11,6% -45.911 -34.101 -221.904

130b+c+dNet impairment losses on other assets and liabilities 605 943 -338 -35,8% -455 107 -1.352

190 Net provisions for liabilities and charges-3.096 988 -4.084 n.s. -2.929 -2.681 -959

240+270Profit (loss) from disposal of equity and other investments 52.744 226.914 -174.170 -76,8% 21.765 114.262 232.976

Profit (loss) on continuing operations before tax 860.183 919.685 -59.502 -6,5% 243.412 343.675 1.109.522

290Taxes on income for the period for continuing operations -317.731 -298.090 19.641 6,6% -98.574 -103.263 -393.487

310 Profit (loss) on non current assets held for sale and discontinued operations net of taxes - 3.407 -3.407 -100,0% -5.839 848 8.559

330

Net profit for the period attributable to minority interests -33.375 -31.322 2.053 6,6% -10.268 -11.901 -43.734

Profit for the period attributable to the Parent bank 509.077 593.680 -84.603 -14,3% 128.731 229.359 680.860

January-September

2006

January-September 2005 pro-

forma

2005 pro-forma

Changes 3rd Quarter 2006

3rd Quarter 2005 pro-

forma

Reclassified consolidated income statement

16

Quarterly reclassified consolidated income statements

Figures in thousands of euro 3rd Quarter 2nd Quarter 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter

10-20 Net interest income 404.352 397.516 398.123 389.715 380.321 376.485 385.276

70 Dividend and similar income 867 7.337 2.151 1.151 443 5.940 2.649

Profit (loss) of equity investments valued using the equity method 2.743 1.829 1.399 -277 1.024 2.273 2.040

40-50 Net commission income 185.673 208.326 215.786 200.223 200.046 190.480 188.792

80+90+100+110

Net profit (loss) from trading, hedging and disposal/repurchase activities22.877 23.654 108.036 57.867 35.950 46.347 35.579

150-160 Net income on insurance operations 11.252 16.222 17.908 17.485 15.395 20.828 13.202

220 Other net operating income / (expense) 12.927 16.627 13.469 12.985 12.482 34.706 12.953

Operating income 640.691 671.511 756.872 679.149 645.661 677.059 640.491

180a Staff costs -239.786 -261.132 -253.494 -262.909 -255.263 -246.577 -253.174

180b Other administrative expenses -97.463 -103.236 -99.304 -102.763 -96.875 -111.066 -99.407

200+210 Net impairment losses on tangible and intangible assets -32.500 -29.004 -26.991 -35.076 -27.435 -24.744 -26.310

Operating costs -369.749 -393.372 -379.789 -400.748 -379.573 -382.387 -378.891

Net operating income 270.942 278.139 377.083 278.401 266.088 294.672 261.600

130a Net impairment losses on loans -45.911 -46.380 -23.943 -90.384 -34.101 -72.334 -25.085

130b+c+d Net impairment losses on other assets and liabilities-455 939 121 -2.295 107 4.012 -3.176

190 Provisions for liabilities and charges -2.929 14 -181 -1.947 -2.681 217 3.452

240+270 Profit (loss) from disposal of equity and other investments 21.765 15.258 15.721 6.062 114.262 49.179 63.473

Profit (loss) on continuing operations before tax 243.412 247.970 368.801 189.837 343.675 275.746 300.264

290 Taxes on income for the period for continuing operations -98.574 -90.504 -128.653 -95.397 -103.263 -95.024 -99.803

310Profit (loss) on non current assets held for sale and discontinued operations net of taxes (*) -5.839 3.688 2.151 5.152 848 1.876 683

330 Net profit for the period attributable to minority interests -10.268 -10.654 -12.453 -12.412 -11.901 -8.880 -10.541

Profit for the period attributable to the Parent bank 128.731 150.500 229.846 87.180 229.359 173.718 190.603

(*) The negative figure for the third quarter of 2006 is the result of the reclassification under the item profit/loss on the disposal of equity and other investments of the profits earned in the two previous quarters of the tax collecion companies disposed of in the third quarter.

2006 2005 pro-forma

17

Reclassified income statement net of the main non recurring components

Figures in thousands of euro

Disposal of equity

investments

Disposal of loans

Effects of normalisation

(*)

Disposal of equity

investments

Disposal of loans

Sale of securities

Other components

Effects of normalisation

(*)

Net interest income 1.199.991 1.199.991 1.142.082 1.142.082 57.909 5,1%

Dividend and similar income 10.355 10.355 9.032 9.032 1.323 14,6%

Profits/losses on equity investments valued using the equity method 5.971 5.971 5.337 5.337 634 11,9%

Net commission income (1) (2) (3) 609.785 4.705 614.490 579.318 -580 578.738 35.752 6,2%

Net profit (loss) on trading, hedging and sale/repurchase activity 154.567 -77.387 -38.478 38.702 117.876 -9.705 -36.869 -12.649 58.653 -19.951 -34,0%

Net income on insurance operations 45.382 45.382 49.425 49.425 -4.043 -8,2%

Other net operating income / (expense) 43.023 43.023 60.141 -21.980 38.161 4.862 12,7%

OPERATING INCOME 2.069.074 -77.387 -38.478 4.705 1.957.914 1.963.211 -9.705 -36.869 -12.649 -21.980 -580 1.881.428 76.486 4,1%

Staff costs -754.412 4.676 -749.736 -755.014 20.100 -4.766 -739.680 10.056 1,4%

Other administrative expenses -300.003 -300.003 -307.348 -307.348 -7.345 -2,4%

Net impairment losses on tangible and intangible assets -88.495 -88.495 -78.489 -78.489 10.006 12,7%

OPERATING COSTS -1.142.910 - - 4.676 -1.138.234 -1.140.851 - - - 20.100 -4.766 -1.125.517 12.717 1,1%

NET OPERATING INCOME 926.164 -77.387 -38.478 9.381 819.680 822.360 -9.705 -36.869 -12.649 -1.880 -5.346 755.911 63.769 8,4%

Net impairment losses on loans -116.234 -116.234 -131.520 -131.520 -15.286 -11,6%

Net impairment losses on other assets/liabilities 605 605 943 943 -338 -35,8%

Net provisions for liabilities and charges -3.096 -3.096 988 988 -4.084 n.s.

Profit/loss on disposal of equity investments 52.744 -51.857 887 226.914 -226.758 156 731 468,6%

PROFIT/LOSS ON CONTINUING OPERATONS BEFORE TAX 860.183 -129.244 -38.478 9.381 701.842 919.685 -236.463 -36.869 -12.649 -1.880 -5.346 626.478 75.364 12,0% Taxes on income for the period for continuing operations -317.731 11.475 14.234 -3.343 -295.365 -298.090 5.507 14.102 4.174 1.557 1.795 -270.955 24.410 9,0%

Profit/loss non current assets held for sale and discontiuned operations net of taxes - - 3.407 -3.434 -27 27 n.s.

Profit/loss for the period attributable to minority interests -33.375 308 581 101 -32.385 -31.322 4.662 739 20 -215 -26.116 6.269 24,0%

PROFIT FOR THE PERIOD ATTRIBUTABLE TO THE PARENT BANK 509.077 -117.461 -23.663 6.139 374.092 593.680 -226.294 -22.028 -8.475 -303 -7.200 329.380 44.712 13,6%

ROE (annualised) 15,5% 11,4% 20,1% 11,1%

Cost / Income ratio 55,2% 58,1% 58,1% 59,8%

(*) In order to present an income statement which conforms more closely to the contribution of ordinary activities, this column includes the effects of a more precise attribution to the period of events recognised in subsequent accounting periods.

(1) The figure for the first nine months of 2006 includes -4,7 million relating to the adjustment of some incorrect intra-company eliminations performed when consolidating the accounts.

(3) If the impact of amortised cost is considered on the figure for the first nine months of 2005, the increase in net commission income is close to 8%

Jan.-Sept. 2006 net

of non recurring

components

January - September 2005 pro-

forma

(2) At 30th September 2005, the estimated impact of amortised cost (applied in the accounts by BPU Banca and by the network banks of the Group for the first time in the accounts as at 31st December 2005) would result in a reduction of 8,9 million in net commissions, an increase of 0,3 million in net interest income and a decrease of 0,5 million in other administrative expenses.

non recurring components

January - September

2006

Jan.-Sept. 2005 net

of non recurring

components

non recurring components Changes Jan.-Sept. 2006/ Jan.-Sept. 2005 net of

non recurring components

% changes net of non recurring

components

18

Method used in the construction of the reclassified consolidated income statement In order to facilitate the reconciliation of the items in the reclassified accounts with the figures in the statements prepared on the basis of Bank of Italy Circular No. 262 of 22nd December 2005, the corresponding number of the item in the mandatory scheme is given in the margin of each reclassified item. The balances thus defined have also been modified to provide a vision more consistent with a management accounting style. More specifically:

- net income from insurance companies comprises all the revenues of the insurance companies: net interest, premiums (item 150), profit from trading activities and net profit/loss from insurance operations and other (items 160 and 220 in the mandatory accounts);

- the tax recoveries recognised under item 220 of the accounts (other operating income/expenses) were reclassified as a reduction in indirect taxes included in other administrative expenses;

- the item profit (loss) on equity investments valued using the equity method includes the profit (loss) on equity investments valued using the equity method included under item 240 in the mandatory accounts;

- the item net impairment losses on tangible and intangible assets includes items 200 and 210 in the accounts and the instalments relating to the depreciation of costs incurred for improvements to third party assets classified under item 220 of the accounts;

- the item profit (loss) on the disposal of equity investments includes the item 240, net of profits (losses) of equity investments valued using the equity method and item 270 in the accounts;

- the item other net operating income/expense includes item 220, net of the reclassifications mentioned above;

- the uses of provisions for liabilities and charges, where the provisions are normally recognised under specific items, are offset against the item “net provisions for liabilities and charges”. In order to provide a uniform comparison, the figures for the 2005 periods have been reclassified as follows: where possible, provisions have been attributed to specific items; in cases of previous recognition under a generic item, uses made in the period have been recognised under specific items, against the item “net provisions for liabilities and charges”.

19

Reconciliation statements Reconciliations between the mandatory schemes and the reclassified accounts as at 30th September 2006 and 30th September 2005 are given below. Reconciliations for the various different interim periods for the reconstruction of the reclassified figures were presented in the Half Year Report to 30th June 2006 which may be consulted. Figures to 30th September 2006

RECLASSIFIED INCOME STATEMENT 30th

September 2006

Reclassifications 30th September 2006

Items

mandatory consolidated

annual accounts

net income on insurance operations

tax recoveries

profit of equity

investments valued at

equity

Deprec. for improvements

to leased assets

uses of /charges for

prov. for liabilities and

charges

reclassified consolidated

accounts

10-20 Net interest income 1.264.699 (65.698) 990 1.199.991

70 Dividend and similar income 10.355 10.355

Profit / (loss) of equity investments valued using the equity method - 5.971 5.971

40-50 Net commission income 609.785 609.785 80-90 100-110

Net profit (loss) from trading and hedging activity 148.997 (4.275) 9.845 154.567

150-160 Net income on insurance operations (24.849) 70.231 45.382

220 Other net operating income / (expense) 113.059 (258) (77.907) 6.791 1.338 43.023

Operating income 2.122.046 - (77.907) 5.971 6.791 12.173 2.069.074 180 a Staff costs (755.410) 998 (754.412)

180 b Other administrative expenses (377.914) 77.907 4 (300.003) 200-210

Net impairment losses on tangible and intangible assets (81.704) (6.791) (88.495)

Operating costs (1.215.028) - 77.907 - (6.791) 1.002 (1.142.910)

Net operating income 907.018 - - 5.971 - 13.175 926.164

130 a Net impairment losses on loans (120.008) 3.774 (116.234)

130 b-c-d Net impairment losses on other assets/liabilities 605 605

190 Net provisions for liabilities and charges 13.853 (16.949) (3.096) 240-270 Profits /(losses) on disposal of equity investments 58.715 - - (5.971) - - 52.744

Profit / (loss) on continuing operations before tax 860.183 - - - - - 860.183

290 Taxes on income for the year for continuing operations (317.731) (317.731)

310 Profit (loss) on non current assets held for sale and discontinued operations net of taxes - -

330 Net profit for the period attributable to minority interests (33.375) (33.375)

Profit for the period attributable to the parent bank 509.077 - - - - - 509.077

Figures to 30th September 2005

RECLASSIFIED INCOME STATEMENT 30th

September 2005

Reclassifications 30th

September 2005

Items

mandatory

consolidated accounts

Tax collection companies

and Centrosiel

net income on

insurance operations

tax recoveries

profit of equity

investments valued at

equity

Deprec. for improvements

to leased assets

uses of /charges for prov.

for liabilities

and charges

reclassified consolidated

accounts

10-20 Net interest income 1.204.951 64 (58.998) (3.935) 1.142.082

70 Dividend and similar income 9.032 9.032

Profit / (loss) on equity investments valued using the equity method - 5.337 5.337

40-50 Net commission income 606.029 (24.110) (1.575) (1.026) 579.318

80-90 100-110 Net profit (loss) from trading and hedging activity 128.809 (6.820) (4.113) 117.876

150-160 Net income on insurance operations (16.536) 65.961 49.425

220 Other net operating income / (expense) 122.867 1.946 1.432 (72.326) 7.930 (1.708) 60.141

Operating income 2.055.152 (22.100) - (72.326) 5.337 7.930 (10.782) 1.963.211

180 a Staff costs (761.342) 9.831 (3.503) (755.014)

180 b Other administrative expenses (381.327) 6.488 72.326 (4.835) (307.348)

200-210 Net impairment losses on tangible and intangible assets (70.762) 203 (7.930) (78.489)

Operating costs (1.213.431) 16.522 - 72.326 - (7.930) (8.338) (1.140.851)

Net operating income 841.721 (5.578) - - 5.337 - (19.120) 822.360

130 a Net impairment losses on loans (120.674) (25) (10.821) (131.520) 130 b-c-

d Net impairment losses on other assets/liabilities 959 1 (17) 943

190 Net provisions for liabilities and charges (28.970) 29.958 988

240-270 Profits /(losses) on disposal of equity investments 232.252 (1) - - (5.337) - - 226.914

Profit / (loss) on continuing operations before tax 925.288 (5.603) - - - - - 919.685

290 Taxes on income for the period for continuing operations (300.584) 2.494 (298.090)

310 Profit (loss) on non current assets held for sale and discontinued operations net of taxes 298 3.109 3.407

330 Net profit for the period attributable to minority interests (31.322) (31.322)

Profit for the period attributable to the parent bank 593.680 - - - - - - 593.680

20

Principal indicators of Group performance1

30.9.2006/ January-

September 2006

31.12.2005/ 2005

30.9.2005/ January-

September 2005

STRUCTURAL INDICATORSNet lending to customers/total assets 71,0% 68,7% 67,6% Direct funding from customers / total liabilities 73,4% 72,1% 73,8% Net lending to customers/funding from customers 96,6% 95,3% 91,7% Shareholders’ equity (excluding profit for the period) / total liabilities 6,2% 5,8% 5,9%

Assets under management/indirect funding from private customers 58,7% 58,1% 56,9%

PROFIT INDICATORSROE (Profit for the period/shareholders’ equity excluding profit for the period) (annualised quarterly figures) 15,5% 16,9% 20,1%

ROE net of non recurring components 11,4% 10,1% 11,1% ROA (Profit for the period/total assets) (annualised quarterly figures) 1,0% 1,0% 1,2% The cost/income ratio (operating expenses/operating income) 55,2% 58,3% 58,1% Cost/income ratio net of non recurring components 58,1% 59,8% 59,8%

Net interest income/operating income 58,0% 58,0% 58,2% Staff costs/operating income 36,5% 38,5% 38,5%

RISK RATIOSNet non performing loans / net loans to customers 0,71% 0,95% 1,24% Net impairment losses on non performing loans/gross non performing loans (coverage for non performing loans) 58,64% 57,32% 52,54%

Net non performing loans/supervisory capital2 6,54% 8,49% 10,08%Net non performing + net impaired loans/net lending to customers 1,62% 2,03% 2,39% Net impairment losses on non performing and impaired loans/ gross non performing + gross impaired loans (coverage) 43,22% 44,34% 42,26%

CAPITAL RATIOS 2

Tier 1 (core capital/total risk weighted assets) 6,80% 7,08% 7,88%Core tier I (core capital net of preference shares/total risk weighted assets) 6,06% 6,24% 7,07%Total capital ratio (supervisory capital+Tier III/total risk weighted assets) 9,82% 10,31% 11,22%

BALANCE SHEET, OPERATING AND STRUCTURAL FIGURES (in thousands of euro)

Net loans to customers 49.798.318 47.300.815 44.918.972

of which: net non performing loans 354.383 451.594 555.818net impaired loans 451.679 508.842 517.246

Direct funding from customers 51.525.791 49.642.145 48.985.505Indirect funding from customers 55.263.106 52.688.620 52.132.737

of which: assets under management 32.412.890 30.636.062 29.650.986Financial wealth of customers 106.788.897 102.330.765 101.118.242Shareholders’ equity (excluding profit for the period) 4.384.028 4.028.353 3.945.498

Supervisory Capital2 5.419.844 5.316.962 5.511.858

of which: Core capital after application of prudential filters (tier I) 2 3.856.406 3.685.290 4.012.960Branches (including 5 foreign branches) (number) 1.186 1.184 1.174Human resources totals (employees + temps) (number) 14.370 14.348 14.639Financial advisors (number) 449 419 428

1 The indicators have been calculated using reclassified figures.

2 The figures as at 30th September 2006 and 30th September 2005 are estimated.

21

NOTES AND COMMENTS ON CONSOLIDATED OPERATIONS

22

23

The macroeconomic scenario The world economy has continued to expand, driven by developing countries and those in the Asiatic area in particular, by the euro area, and although it is now slowing because of a weakening property market, by the United States. The international economic situation has benefited in recent weeks from a substantial fall in oil prices. At the end of September Brent had fallen to 62,5 dollars per barrel from 75,3 dollars at the end of June and then stabilised at around 60 dollars in the weeks that followed, with positive effects on inflation. In the third quarter the United States economy grew at the slowest rates since the start of 2003: the increase in GDP (annualised) was in fact +1,6% (compared to +5,6% and +2,6% in the two previous quarters) affected above all by the sharp fall in investments in housing and by the negative contribution from net foreign demand, while consumption and non residential fixed investments recovered slightly. The slowdown in the economy suggested a pause was necessary in the series of adjustments to the federal funds rate which remained unchanged since June at 5,25%. The recent fall in oil prices slowed growth in the consumer price index which stood at 2,1% in September compared to 4,3% in June, but core inflation, net of foodstuffs and energy products, increased to 2,9%, the highest level for more than ten years. The unemployment rate continued at the same levels as in June at 4,6%, while the trade deficit remained still very high, worsening to 522,8 billion in the first eight months of 2006 (more than 14% greater than in the same period of 2005) despite the depreciation in the US currency which was quoted at 1,2671 dollars against the euro at the end of September (1,184 at the end of 2005). The improvement in the public spending deficit continued, however (128 billion dollars in the first nine months compared to 202 billion in 2005). The Chinese economy does not yet seem to have shown any significant signs of reacting to the increases in interest rates and the other tight measures introduced. GDP grew by 10,7% on an annual basis in the first nine months; fixed investments increased by 27,3%; total industrial output increased by 17,2% with even greater increases in the automobile and microcomputer sectors. The current economic situation is not fuelling inflation, however, with the consumer price index stable at 1,5%. Japan is continuing its phase of moderate expansion, driven by fixed investments, private consumption and exports. Industrial output increased in September by 5,1% on an annual basis, while the last Tankan report recorded a new improvement in the level of confidence for medium to large size enterprises. The unemployment rate remained unchanged at 4,2% in June, while inflation recorded its fourth consecutive increase in September to 0,6% annually. The figures for the second quarter were revised upwards with GDP growing by 2,7% compared to the same period in the previous year to confirm the economic recovery recorded in the euro area as borne out by industrial output, up on an annual basis by 5,4% in August, and by a stable unemployment rate of 7,8%. The September data for inflation showed a fall to 1,7% from 2,5% in June for the total harmonised index, while the core index, net of energy products and foodstuffs, remained at 1,5%. In consideration of the risks for price stability that it saw in the current positive phase of the economic cycle, the ECB decided to raise the principal refinancing rate for the fifth time since December 2005, by 0,25 percentage points so that it now stands at 3,25%. The favourable European economic situation is producing positive effects for the Italian economy also, even if in more moderate terms. The index for industrial output, adjusted for the number of working days, recorded annual growth in August of 3,5% (+1,9% in the period January-August) with particularly strong growth for the means of transport and electronics sectors, while the latest data available for the labour market for the second quarter showed unemployment falling further to 7%.

24

Exports are performing positively (+9,7% in the first eight months), but are nevertheless unable to offset imports, especially in the energy sector. Consequently the balance of payments on trade for the first eight months of the year recorded a deficit of 15,8 billion euro compared to -4,8 billion in 2005. As opposed to the average for the euro area, Italian inflation, as measured by the harmonised consumer price was still stable in September at 2,4%, with an improvement in October to 2% (+1,6% the figure for Europe). Despite higher than forecast revenues, containment of public spending and the corrective action taken in July, the deficit to GDP ratio for 2006 was further revised upwards to 4,8% because of the negative effects for the current year of the ruling by the European Court of Justice on the deductibility of VAT. The objective for 2007, in line with commitments made in 2005 at European level, is to bring this indicator down below 3%. On the financial front, equity markets almost fully recovered the losses they had incurred in May and June. The principal indexes of stock markets (in local currencies) performed as follows since the beginning of the year: +11,3% for the Paris Cac 40, +11% for the Frankfurt Xetra Dax, +9% for the Dow Jones Industrial of New York, +7,8% for the Milan S&P/Mib, +7% for the New York S&P 500, +6,1% for the London Ftse 100 and +2,4% for the Nasdaq Comp. of New York, +0,9% for the Nikkei 225 and -1,5% for the Tokyo Topi. The increase in the MSCI index for emerging markets was +10,15%. In the context of a progressive change in the composition away from Italian funds (-32,1 billion) to foreign registered funds (+20,9 billion), the mutual funds sector ended the first nine months of the year with a net negative inflow of 11,2 billion euro, affected by a sharp fall in the bonds sector (-24,1 billion). Monetary (-6 billion), equity (-4,6 billion) and balanced funds (-0,3 billion) performed negatively while positive contributions came from flexible funds (+18,7 billion) and hedge funds (+5,1 billion) only. At the end of September net assets under management in funds amounted to 604,3 billion euro (584,6 billion at the end of 2005). Preliminary ABI (Italian Banking Association) estimates for operations in the banking sector for September show total funding (savings deposits, current accounts, certificates of deposit and bonds) up by 7% on an annual basis, driven again by bonds +10,7%, compared to an increase of 4,6% for all other forms. The positive trend for lending was consolidated with an annual increase of 10,8% as a result of steady growth in the medium to long term component (+13,2%) and a further acceleration in the short term component (+6,9%). On the basis of the latest information available relating to August, non performing loans “net of impairment” decreased on an annual basis by 15,4% (-15,3% “gross of impairment”). Therefore the ratio of net non performing loans to loans fell to 1,29% (1,35% in December) partly because of securitisation operations performed, while the ratio of non performing loans to supervisory capital improved to 6,99% (7,17% at the end of 2005). Again in August, the securities portfolios of banks recorded an increase over twelve months of 6,2%, attributable primarily to the “other securities” component (+17,8%) and, to a lesser extent, to the medium to long term component (CCT and BTP, +2,1%), while the short term component contracted (BOT e CTZ, -14,9%). The ratio of securities to lending in euro fell to 13,8% (14,4% in December). Finally as concerns the main interest rates, the average rate for bank funding from customers (which includes the yield on deposits, bonds and repurchase agreements for private individuals and non financial companies) increased progressively in 2006, in line with market trends, from 1,72% in December, to 1,93% in June and to 2,08% in September. At the same time the average weighted rate on total lending to private individuals and non financial companies gradually rose to 5,19% (4,96% in June) from 4,65% in December.

25

26

The distribution network and the positioning of the Group The branch network and the distribution channels As at 30th September 2006, the branch network of the Banche Popolari Unite Group consisted again of 1.186 branches, but had risen to 1.187 at the date of this report.

Table No. 1

30.9.2006 31.12.2005 30.9.2005

BPU Banca Scpa 2 2 2Banca Popolare di Bergamo Spa* 375 375 376Banca Popolare Commercio e Industria Spa 223 222 225Banca Popolare di Ancona Spa 230 230 215Banca Popolare di Todi Spa 17 17 17Banca Carime Spa 325 324 325B@nca 24-7 Spa 1 1 1IW Bank Spa 2 2 2Banque de Dépôts et de Gestion Sa - Svizzera 4 4 4Centrobanca Spa 7 7 7TOTAL 1.186 1.184 1.174

* The figure includes 1 foreign branch

Financial advisors 449 419 428ATM 1.328 1.325 1.309POS Terminals 38.781 38.428 38.312

Branch network of the BPU Banca Group in Italy and abroad

As can be seen from the table 1, the increase in the number of branches that occurred over the twelve month period is attributable mainly to the implementation of a plan to open twenty new branches by BANCA POPOLARE DI ANCONA (fully described in the 2005 annual report, which may be consulted), which was successfully completed after the end of the third quarter of 2006 with the opening of the Cervia branch at 39 Via Giuseppe Di Vittorio in October.

The additional changes occurred in the first half of 2006 as already reported in the Half Year Report to 30th June 2006, which may be consulted. As concerns the implementation of that part of the Industrial Plan designed to optimise market presence and which more specifically concerns the disposal of branches located in the South of Italy in not very competitive situations, on 13th November 2006, given the authorisation issued by the Bank of Italy at the start of November, the boards of directors of BPU Banca and Carime Banca passed a resolution to sell a line of business consisting of 15 branches located in Puglia (12), Basilicata (2) and Molise (1) to Banca Popolare Pugliese. As at 31st December, with more than 20.500 customers, these branches had total funding from customers (direct and indirect) of approximately 300 million euro and lending of approximately 80 million euro, with approximately 70 staff. The transfer, for which Banca Popolare Pugliese will pay goodwill on the line of business to the BPU Group of 27,4 million euro, will be concluded by the end of the first half of 2007. Furthermore under the 2006-2008 Industrial Plan, Banca Carime is to open 10 branches in the period in question located in provinces that are more attractive for the Group’s business.

27

* * *

The Group is present abroad not only with the Banque de Dépôts et de Gestion and the Munich branch of the Banca Popolare di Bergamo, but also in Luxembourg with BPU Banca International, in Jersey, with BPU Trust Co. Ltd. and with representative offices in Singapore, Hong Kong, San Paolo (Brazil), London and Mumbai (India). A new representative office was opened in Shanghai in September designed, like the Indian office, to provide better assistance to the Group’s corporate clients that are starting up commercial and industrial businesses in those countries. As can be seen from the table 1, the geographical presence of the Group is reinforced by 449 financial advisors (belonging entirely to BPU Sim Spa) of which more than 70% work in banks in the Group. Finally the branch network is then completed by 76 units dedicated to the support of private customers and 66 units to support the corporate customers of the Group with no changes with respect to the details given in the table in the Half Year Report which may be consulted. Remote channels The branch network also makes use of functions provided by remote channels (home banking, telephone banking, corporate remote and Internet banking), which are being positively received especially in the light of the new functions available to customers, described in detail in the Half Year Report already cited, which may be consulted. As concerns those channels available to private customers, the service QUI BPU Home Banking (the former Home Banking LINEATTIVA) recorded an increase in the first nine months of +36,8% in the number of users registered, up to 163.581 from 119.537 at the end of 2005. The customers of the service QUI BPU Phone Banking also recorded an increase, with an improvement of almost 25% to 202.339 compared to 161.958 registered users last December.

A total of more than 40% of securities trading performed on regulated markets by private customers through the SIM brokering firm takes place using remote channels. As concerns on the other hand the channels destined to corporate clients and that is the CBI Multibanca services (Remote Banking and Internet Banking Levis), the number of corporate users of the service in the BPU Group had risen to 71.057 (more than 63 thousand at the end of 2005) at the end of September. At present more than 27% of credit transfers and 75% of payments received electronically by corporate clients are effected on line. Credit and debit cards There was also constant growth in the first nine months of the year in the distribution and use of credit and debit cards. The number of Libra charge cards in issue at the end of September had risen to 329.328, an increase of more than 40%, while revolving credit cards had reached 62.213 compared to 37.761 at the end of 2005 (+64,8%). In consideration of these results, the total number of credit cards distributed to customers has exceeded 751 thousand and this was accompanied by a parallel increase in their use during the period (+13,8% compared to the first nine months of 2005).

28

Finally, as concerns direct debit cards (Bancomat-Pagobancomat and the rechargeable cards), these increased to a total of 1.082.092 (including more than 345 thousand multi-function cards, i.e. cards which also have a credit function) while their use at retailer POS terminals had increased by 5,3% compared to same period in 2005. The positioning of the Group The market positioning of the BPU Banca Group in terms of branches, traditional funding (excluding bonds) and lending, constructed on the basis of the latest available information from the Bank of Italy, is given in Table 2 both with respect to the national market and for the main areas in which the banks in the Group operate. In some of the regions and/or provinces where the Group’s presence is stronger, it continues to enjoy a market share of traditional funding and/or lending that is greater than its share of branches.

Table No. 2

Branches Funding (**) (***)

Lending (***)

Lombardy 8,0% 8,6% 7,2%

Prov. of Bergamo 20,9% 35,4% 32,2%

Prov. of Brescia 3,4% 4,8% 5,8%

Prov. of Como 4,9% 6,1% 7,3%

Prov. of Lecco 4,2% 5,3% 6,3%

Prov. of Milan 6,2% 5,5% 4,8%

Prov. of Varese 25,2% 32,4% 21,0%

Marches 9,6% 11,7% 11,8%

Calabria 23,7% 22,6% 13,5%

Basilicata 18,3% 12,3% 9,1%

Puglia 9,2% 7,5% 4,5%

Total Italy 3,7% 4,0% 3,6%

(***) Market share by location of the branch.(**) Current accounts , certificates of depos it, savings deposits .(*) The financial data is taken from Bank of Italy s tatis tics .

Market share of the BPU Group (*)

June 2006

29

Group human resources As at 30th September 2006 the human resources of the companies belonging to the Banche Popolari Unite Group numbered 14.370 compared to 14.639 in September 2005 and 14.348 in December 2005. As can be seen from the table No. 3, there was a reduction in numbers on an annual basis of 269, of which 168 attributable to a reduction in permanent staff and 101 to containment of temporary agency staff numbers. The reduction in numbers of permanent staff, in line with Industrial Plan forecasts, was the result of 867 staff leaving, of which 212 on early retirement schemes and 202 from use of the ‘solidarity fund’ against 699 new appointments, of which 281 on permanent contracts and 418 on temporary contracts. The phenomenon of intragroup transfers affected a total of 111 staff.

Table No. 3

30.9.2006 30.9.2005 Change 31.12.2005

BPU Banca Scpa 1.992 1.989 3 1.974

BPB Spa 3.835 3.849 -14 3.827

BPCI Spa 2.194 2.240 -46 2.251

Banca Carime Spa 2.756 2.904 -148 2.807

Banca Popolare di Ancona Spa 1.768 1.742 26 1.770

Banca Popolare di Todi Spa 83 84 -1 83

Centrobanca Spa 304 300 4 300

Banque de Dépôts et de Gestion Sa 101 101 - 102

BPU Banca International Sa 18 15 3 16

B@nca 24-7 Spa 60 46 14 48

IW Bank Spa 141 146 -5 149

TOTAL FOR BANKS 13.252 13.416 -164 13.327BPU Sim Spa 41 41 - 41

FinazAttiva Servizi Srl 41 38 3 41

Centrobanca Sviluppo Impresa SGR Spa 2 - 2 2

BPU Centrosystem Spa 22 24 -2 24

BPU Pramerica SGR Spa 92 85 7 88

BPU Esaleasing Spa 116 121 -5 123

Plurifid Spa 7 8 -1 7

BPB Immobiliare Srl 13 13 - 10

BPU Partecipazioni Assicurative Spa 110 110 - 110

BPU Assicurazioni Spa 177 181 -4 180

BPU Assicurazioni Vita Spa 30 31 -1 31

BPU Mediazioni Assicurative Srl 37 39 -2 38

Mercato Impresa Spa 71 72 -1 71

TOTAL EMPLOYEES 14.011 14.179 -168 14.093 TEMPORARY AGENCY STAFF 359 460 -101 255

TOTAL PERSONNEL 14.370 14.639 -269 14.348

Personnel of the BPU Group

The situations at 30th September 2005 and at 30th December 2005 have been reconstructed on a uniform basis, excluding the tax collection companies (Bergamo Esattorie Spa and Ancona Tributi Spa), both sold to Riscossione Spa with effect from 30th September 2006. The personnel of Centrobanca Spa as at 30th September 2005 and 31st December 2005 have been increased to take account of the staff of Investimenti Piccole Imprese staff, merged into it on 29th August 2006.

30

The reductions in staff affected Banca Carime (-148 staff), Banca Popolare Commercio e Industria (-46) and Banca Popolare di Bergamo (-14), in line with the redundancy plan. Staff numbers increased at Banca Popolare di Ancona (+26 staff in relation to the plan to open 20 new branches) and at B@nca 24-7 (+14 staff to develop new areas of business) in compliance with the Industrial Plan. Staff belonging to non banking Group member companies remained virtually unchanged compared to twelve months previously.

The Graph1, which illustrates changes in Group staff in the medium term according to type of contract. As can be seen, the progressive reduction in the number of employees on permanent contracts has been accompanied by a use of temporary contracts to ensure a margin of flexibility in the labour force.

More specifically, the current use of temporary agency staff is attributable to important rationalisation (business process re-engineering) and development projects connected with the Industrial Plan, which need temporary staff during the implementation stage. This contractual instrument is also used to meet temporary requirements arising from timing differences between incentive leaving plans and redundancy plans. The changes in the number of workers on temporary contracts are, however, related to the employment plan for generation turnover. As specified in the related trade union agreements and in compliance with the policies and key performance indicators contained in the Industrial Plan, these constitute a priority pool on which to draw on when making permanent employee appointments. Developments in redundancy plans and the employment programme As stated in previous financial reports, the leaving incentive plan for the period 2005-2007, to be implemented by early retirement and adhesions to the ‘Income Support Fund”, reached its target ahead of the schedule indicated in the Industrial Plan. It received the 948 adhesions forecast, of which 444 had already occurred in 2005 to which another 205 which occurred in the first nine months of 2006 can added. The total number that have left on leaving incentive schemes in the Banche Popolari Unite Group since it was formed rose to 1.561 (of which 11 relating to the tax collection companies recently disposed of).

1 For the purposes of a uniform comparison the figures prior to 30th September 2006 have been reconstructed on the

basis of the companies included in the consolidation at that date.

CHANGES IN STAFF BY TYPE OF CONTRACT

12.500

13.000

13.500

14.000

14.500

15.000

15.500

dic-0

3

mar-0

4

giu-0

4

set-0

4dic

-04

mar-0

5

giu-0

5

set-0

5dic

-05

mar-0

6

giu-0

6

set-0

6

Temporary agency staff

Employees on temporarycontracts

Permanent staff

31

The achievement of the objectives set has made it possible to go ahead with the employment plan contained in the Industrial Plan, which involves up to a maximum of 700 new appointments (approximately half resulting from the conversion of temporary contracts) designed to encourage generation turnover. At 30th September 2006, 642 permanent appointments had already been made, 333 of which achieved by converting temporary contracts and 309 from new permanent appointments2. Trade union relations The following agreements were concluded with trade union organisations in the third quarter of 2006: on 14th September a memorandum of intent was signed for the centralisation in BPU

Centrosystem Spa of the IT activities performed by the 11 specialist product companies of the Group, by transferring the relative departments that are currently meeting IT needs internally;

on 28th September 2006 an agreement was reached to set up a Banca 24-7 excellence centre for consumer credit at the Jesi centre; on the same date negotiations for the centralisation of the Operational Legal Advice function of the Group’s network banks at the Parent Bank were concluded successfully;

on 12th October an agreement was signed in relation to the merger of Banca Popolare di Todi into Banca Popolare di Ancona Spa.

As concerns the positions of the 67 employees of the two tax collection companies recently sold to Riscossione Spa, at the date of this report 53 positions at Ancona Tributi Spa had been decided and 8 were still pending, while all 6 positions at Bergamo Esattorie Spa had been settled. Finally the first trade union platforms have been presented in some Group member companies for the renewal of supplementary company agreements.

2 As provided for in the trade union agreements, the achievement of the quantitative objectives contained in the

Industrial Plan will allow an equal number of workers to be appointed on permanent contracts.

32

Strategic lines of development State of progress for industrial projects The project activities of the Banche Popolari Unite Group continued in the first nine months of the year in relation to the update of the 2005-2007 Industrial Plan and to the update of the 2006-2008 Industrial Plan3, as detailed below:

• Update of the 2005-2007 Industrial Plan: 18 original projects, of which 4 already concluded (including the “Settlement of BPA litigation” and the MASTER project), 6 that will be completed in 2006 (including: “Business Continuity”, “Compliance with Legislative Decree No. 231/2001”, “Segment Reporting”, “IWBank”), while the remaining projects will be concluded in 2007 (including: “BPR Finance”, “Internal Processes, Rules and Regulations”). At 30th September 2006, 78% of total project activities had been completed. The main achievements in the period January-September 2006 were:

- “MASTER”: introduction of new philosophies, new governance instruments and processes in local areas for the three market segments;

- “Business Continuity”: definition of the operational model for managing operational continuity and implementation of logistics and training action;

- “Compliance of the Group Organisational Model with Legislative Decree No. 231/2001”: completion of the Organisational, Management and Control model for all the network Banks and the main Group member companies;

- “Segment Reporting”: definition of the cost allocation model; - “IWBank”: acquisition of a further 20% interest; the centralisation of order routing

activities at IWBank was completed at the start of November; - “BPR Finance”: the reorganisation of middle office and back office functions and the

migration of the Summit procedure (management of unlisted derivatives contracts) to the Panorama platform;

- “Internal Processes, Rules and Regulations”: definition of the methods and reference standards and completion of the first version of the regulations for BPU Banca.

• Update of the 2006-2008 Industrial Plan: 28 new projects, of which 6 to be completed during

the year (the main projects include: “Merger of Banca Popolare di Todi into BPA”, “BPR Public Authority Treasuries”, “Group Multi-Channel Strategy-phase 2”, “Credit Monitoring Process”), 16 to be completed in 2007 (including: “Group Branding and branch layouts”, “BPR loans”, “Group Global Risk Management-Phase 2”, “Human Resource Development Policies – Phase 2) and 5 in 2008 (including: “Internal rating-Phase 2”, “Control of Finance Management”), while 1 project (“Customer Satisfaction”) has been “suspended” with the activities channelled into other projects in the commercial focus area. At 30th September 2006, 39% of total project activities had been completed. The following main results were achieved:

- “Merger of Banca Popolare di Todi into BPA”: operation currently being completed; - “BPR Public Authority Treasuries”: activation of the new organisational model at all the

Group’s network banks; - “Group Multi-Channel Strategy-phase 2”: release of the new Group home banking

system (QuiBPU) and information services provided to customers via SMS and email; - “Credit monitoring process”: activation in all network banks of new processes and new

credit monitoring instruments;

3 The remaining activities of the 2003-2006 Integration Master Plan, practically finished at the end of 2005, have now

been absorbed by the new projects of the 2006-2008 Industrial Plan, except for “leasing integration” , which took place at corporate ownership level last July and for which the relative project activities will be complete by the end of 2006 and the “branches plan” to be completed in the 2006-2008 period.

33

- “BPR loans”: new model for management of medium to long term loans defined, review of the process for centralised mortgages and automation of contracts for decentralised mortgages;

- “Human Resource Development Policies Phase - 2”: start of Zenith training project to improve skills of network bank commercial staff;

- “Internal rating-Phase 2”: revision of retail customer rating models with the release of the override module (with which an account manager can make adjustments to automatic ratings assigned to customers, after first consulting with central units), performance scoring, and the revision of ratings assigned for personal loan products.

Income/cost synergies: evolution in the first nine months of 2006 In the first nine months of 2006 income synergies of 59,1 million were achieved compared to 58,4 million forecast in the update to the 2006-2008 Industrial Plan, as a result of growth in existing products (in mortgage loans and personal loans in particular) and with sales of new products basically in line with objectives (with positive performance by corporate bundled accounts and performance poorer than expected by non life insurance policies and OTC derivatives). On the cost synergies side, the forecasts contained in the staff reduction plans were confirmed: from 1st July 2003, the base line date of the Industrial Plan, until 30th September 2006, Group personnel numbers were reduced by 832 on a like-for-like basis (the result primarily of 1.335 less permanent staff and of 503 net new staff on temporary contracts and from temp agencies), principally the result of 1.5504 staff leaving voluntarily for early retirement and adhesion to the redundancy scheme fund. This performance created synergies of 52 million, compared to 45,6 million forecast in the update to the 2006-2008 Industrial Plan. The item “other administrative expenses” also recorded the achievement of integration synergies generated primarily by the renegotiation of contracts with suppliers based on the new dimensions of the Group, as well as by the migrations onto the ICT target system by Banca Carime and BPCI. At the end of September 2006 synergies amounted to 84,2 million, compared to 67,4 million forecast in the update to the 2006-2008 Industrial Plan. The rationalisation and enhancement of the value of equity investments The process of rationalising the Group’s portfolio of equity investments also continued in the third quarter and with regard to equity investments not included in the consolidation held for investment purposes this saw the partial disposal of CIM Italy Spa. A total of 150.000 shares were in fact sold to Istituto Centrale Banche Popolari Italiane to generate a profit on the sale (item 100 in the income statement) of 3,4 million euro (2,8 million attributable to BPU and 600 thousand to BPA). The Parent Bank sold 5,42% of the share capital and at the end of September still held an 8,437% interest, while BPA sold the whole of the interest it held amounting to1,4% of the share capital. This operation is to be added to the list of disposals already performed during 2006 and which involved the following companies (only the most significant are mentioned): Banca Italease, SI Holding, Meliorbanca and Esatri Spa.

4 Of which 1.512 in the “core” perimeter (BPU Banca and the network banks and 38 at Centrobanca. The difference

between the net reduction in permanent staff (-1.335) and total staff leaving with incentives (1.550) is due to the partial replacement of the latter with new permanent staff appointments.

34

As concerns companies included in the consolidation, different operations continued in parallel to each other (according to the guidelines of the original Industrial Plan and subsequent updates) with the reorganisation of Group member companies which perform the same or similar activities involved in merger operations on the one hand and special action designed to increase the operating and/or technological, organisational and infrastructural potential of other companies on the other hand. The following operations, which have either already been performed or are currently in progress, as reported in detail in the first section “The consolidation area”, to which reference may be made, fall within the former category: - the merger of IPI into Centrobanca; - the merger of Esaleasing Spa into BPU Leasing Spa, with the resulting BPU Esaleasing; - the merger of Immobiliare BPU into BPB Immobiliare; - the merger of Banca Popolare di Todi into BPA. The following operations, however, currently still in progress, belong to the second type of action: - IW Bank: on 9th October 2006 a shareholders’ meeting resolved an increase in the share

capital with option rights excluded, after first fractioning the nominal value of shares, for the creation of floating capital for the listing of the bank. More precisely the shareholders resolved: a) to split the current 3.028.145 shares with a nominal value of 5 euro into 60.562.900 shares with a nominal value of 0,25 euro; b) to increase the share capital by a maximum amount of 2.750.000 euro to be completed by 31st December 2007;

- BPU Centrosystem: one of the objectives of the Industrial Plan is to integrate the IT systems of those subsidiaries which to not use the Parent Bank’s system. The project, which was started in January 2006 and should be completed within 18 months, involves the use of the company (the former Centrosiel) as a centre for integrating the activities of the ICT resources of the 12 product companies with the transfer of their relative ICT departments or their IT assets and instruments and consequent full outsourcing of ICT services by BPU Centrosystem. This solution is designed not only to reduce costs, but also to rationalise the software application subsystems as a whole and to equip those companies with appropriate disaster recovery and business continuity solutions. An industrial partner was brought in to achieve this both to reduce design risks and to acquire all the necessary professional expertise. On 22nd September 2006 a shareholders’ meeting of BPU Centrosystem resolved an increase in the share capital in order to give it the means necessary to acquire the IT departments mentioned; on that basis the share capital was increased from 516.600 euro to 6.516.600 euro on 30th October 2006. Again on 30th October the respective contracts were signed for the sale to BPU Centrosystem of the specific ICT assets by the companies concerned (B@nca 24-7, BPU Assicurazioni, BPU Assicurazioni Vita, BPU Esaleasing, BPU Partcipazioni Assicurative, BPU Sim, Centrobanca, FinanzAttiva, BPU Mediazioni Assicurative, Mercato Impresa, Centrobanca Sviluppo Impresa SGR, Plurifid) for a total price of 8,8 million and the contract for the supply of ICT services between BPU Centrosystem and the outside supplier was also signed. The latter will supply technological consultancy services to optimise the use of IT resources (infrastructures and application software), consultancy services to design and implement an architecture to optimise organisation and also technology administration and management services (facility management, desktop management, network management and application management).

35

Information on risks and hedging policies BANKING GROUP RISKS As part of periodical financial reporting and in continuity with the information given in the annual report, a brief qualitative and quantitative analysis is given of the main risks to which the banking group is subject. A quantitative update of the main risk indicators is given below, while the 2005 annual report may be consulted for general aspects and risk management policies which have already been reported. MARKET RISKS Interest rate risk – Supervisory dealing portfolio Information of a qualitative nature

Information on organisational and methodological aspects, which are unchanged, is given in the 2005 Annual Report. Information of a quantitative nature

In order to take account of risks not currently measured by the model in use, market VaR calculated according to the Monte Carlo method is integrated with VaR calculated on alternative investments (hedge funds) and with credit VaR (measured using Credit Metrics methods) calculated on corporate securities. Furthermore, the measurement of market VaR also includes capitalisation certificates as from 2006. The table below gives average and end of period figures for VaR at the end of September. The analysis includes both the dealing portfolio and the banking portfolio (banking book). A new hierarchy of portfolios is currently being defined at Group level to keep the dealing portfolio separate from the banking portfolio (this is also in view of the validation of the internal market risk model by the supervisory authority). As a first approximation, at 30th September 2006 the dealing portfolio represented approximately 15% of the total value, with a VaR of 4,08 million euro (the VaR of the banking portfolio on the same date was 5,56 million). The VaR limits were never exceeded during the first nine months of 2006.

Figures in millions of euro

NAV* 30th

September 2006

1 day VaR** 30th September

2006

Average VaR Jan.-Sept.

2006 NAV*

30th June 2006 1 day VaR**

30th June 2006Average VaR

first half 2006

Bond portfolios 11.054,34 7,08 7,61 11.301,89 7,77 7,73

Equity portfolios 575,86 3,57 3,74 401,28 3,50 3,62

Cash -16,24 0,21 0,12 2,30 0,01 0,13 Total BPU Group *** 11.613,96 7,89 9,03 11.705,47 9,07 9,37

* Operational value. ** VaR based on the Monte Carlo method with a confidence interval of 99% and a time period of 1 day to which VaR on alternative

investments and credit VaR is summed. *** The portfolio of BPU Assicurazioni was excluded from the Group total (NAV at 30th September 2006 of 2.445,09 million euro)

36

Interest rate risk – banking portfolio Information of a qualitative nature

The analysis includes all balance sheet and off-balance sheet (derivatives) items sensitive to interest rate risk. See the 2005 Annual Report for further details. Information of a quantitative nature

In accordance with the positioning range decided by the Board of Directors of the Parent Bank, the interest rate risk for the BPU Group in the first nine months of 2006, as measured using sensitivity analysis for +100bp, averaged approximately -107,8 million euro compared to -108,4 million in the first half and it amounted to a -98,5 million euro at the end of September (-119,7 million at 30th June 2006). The maximum for the first nine months of 2006 was -119,7 million euro and the minimum was -98,5 million euro. The table below gives the risk measured for the periods cited for a standardised parallel shift in the curve of 200 bp, in compliance with the requirements of Basle II, measured on the core and supervisory capital at the end of the period. Risk indicators - annual average Jan.-Sept. 2006 1st half 2006

parallel shift of 200 bp (100 bp)

sensitivity/Tier I 5,11% (2,55%) 5,72% (2,86%) sensitivity/supervisory capital 3,63% (1,82%) 4,04% (2,02%) Risk indicators – end of period values 30.9.2006 30.6.2006

parallel shift of 200 bp (100 bp)

sensitivity/Tier I 5,60% (2,80%) 6,34% (3,17%) sensitivity/supervisory capital 3,98% (1,99%) 4,46% (2,23%)

37

Traditional banking business Direct funding The commercial policy of the Group is oriented towards growth in volumes administered on behalf of customers, termed financial wealth and summarised in table 7, which is now close to 107 billion euro, an increase of 5,6% on an annual basis, It is the result of positive growth in indirect funding and in assets under management in particular as well as in direct funding. Financial wealth of customers

Table No. 4

absolute %

Direct funding from customers 51.525.791 48,3% 49.642.145 48,5% 48.985.505 48,4% 2.540.286 5,2% 50.895.904

Indirect funding from customers 55.263.106 51,7% 52.688.620 51,5% 52.132.737 51,6% 3.130.369 6,0% 53.767.063of which: assets under management 32.412.890 30,4% 30.636.062 29,9% 29.650.986 29,3% 2.761.904 9,3% 31.400.485

FINANCIAL WEALTH 106.788.897 100,0% 102.330.765 100,0% 101.118.242 100,0% 5.670.655 5,6% 104.662.967

Figures in thousands of euro31.12.2005 pro-forma

B

30.9.2005 pro-forma

C

30.9.2006A 30.6.2006Changes A/C% % %

Direct funding from customers, which is the sum of “amounts due to customers” (liabilities item 20 on the balance sheet adjusted for policies of a predominantly financial character issued by BPU Assicurazioni Vita, classified under assets under management) and “securities in issue” (liabilities item 30 on the balance sheet), amounted to 51,5 billion euro at the end of September, an improvement of 5,2%. It can be seen from the relative table contained in the subsequent section, “Figures for the principal companies in the BPU Banca Group”, that significant contributions have been made to growth in the consolidated aggregate over the twelve month period by Banca Popolare di Bergamo (+5,4%) and by the Parent Bank, BPU Banca through international funding (+12%), as well as by IW Bank (+57,3%), Banca Popolare di Ancona (+3,7%), Centrobanca (+5,9%), Banca Carime (+1,8%), la Banca Popolare di Todi (+15,6%) and BPU Banca International (+31,1%). Direct funding for Banca Popolare Commercio e Industria on the other hand remained basically stable, while it is experiencing growth in assets under management. Direct funding from customers

Table No. 5

absolute %

DUE TO CUSTOMERS (item 20 Liabilities)

29.607.923 57,5% 29.370.331 59,1% 28.813.075 58,8% 794.848 2,8% 29.431.352

- financial products of BPU Assicurazioni Vita

-620.033 -1,2% -653.436 -1,3% -678.495 -1,4% -58.462 -8,6% -616.963

DUE TO CUSTOMERS 28.987.890 56,3% 28.716.895 57,8% 28.134.580 57,4% 853.310 3,0% 28.814.389

SECURITIES IN ISSUE (item 30 Liabilities)

22.537.901 43,7% 20.925.250 42,2% 20.850.925 42,6% 1.686.976 8,1% 22.081.515

of which: EMTN (*) 4.698.097 9,1% 3.647.520 7,3% 3.448.709 7,0% 1.249.388 36,2% 4.423.097

TOTAL DIRECT FUNDING 51.525.791 100,0% 49.642.145 100,0% 48.985.505 100,0% 2.540.286 5,2% 50.895.904

of which: subordinated liabilities 2.594.688 5,0% 1.919.497 3,9% 2.585.205

of which: - preference shares (*) 415.000 0,8% 415.000 0,8% 415.000

0,8% - - 415.000

- EMTN (*) 1.040.000 2,0% 770.000 1,6% 570.000 1,2% 470.000 82,5% 1.040.000

(*) Nominal values

Figures in thousands of euro %30.9.2006A

31.12.2005 pro-forma

B% 30.6.2006% Changes A/C

30.9.2005 pro-forma

C

As concerns the types of funding, tables 5 and 6 show that approximately 1,7 billion (66% of the total) of annual growth in the Group’s direct funding, amounting to 2,5 billion, has come from securities funding, while the remaining 0,8 billion has come from the total of the other forms of funding. The latter includes current accounts, driven, amongst other things, by

38

growth in bundled accounts (the number of Utilio and Duetto accounts increased on an annual basis by 51% and the relative deposits by more than 30%). Composition of direct funding

Table No. 6

absolute %

Current accounts and deposits 26.077.997 50,6% 26.184.251 52,7% 25.217.159 51,5% 860.838 3,4% 26.158.206

Time deposits 531.031 1,0% 433.097 0,9% 383.559 0,8% 147.472 38,4% 484.427Funds administered on behalf of public bodies 5.325 0,0% 5.654 0,0% 6.324 0,0% -999 -15,8% 6.313

Financing 82.653 0,2% 124.390 0,2% 81.066 0,1% 1.587 2,0% 85.962

- financial leasing 1.344 0,0% 3.509 0,0% 3.959 0,0% -2.615 -66,1% 1.749

- other 81.309 0,2% 120.881 0,2% 77.107 0,1% 4.202 5,4% 84.213

Amounts due for commitments to repurchase own equity instruments - - - - - - - - -

Liabilities relating to assets transferred not derecognised in the accounts 1.763.881 3,5% 1.418.131 2,9% 1.458.021 3,0% 305.860 21,0% 1.521.695

- reverse repurchase agreements 1.763.881 3,5% 1.418.131 2,9% 1.458.021 3,0% 305.860 21,0% 1.521.695

- other - - - - - - - - -

Other payables 1.147.036 2,2% 1.204.808 2,4% 1.666.946 3,4% -519.910 -31,2% 1.174.749

- financial funding of BPU Assicurazioni Vita -620.033 -1,2% -653.436 -1,3% -678.495 -1,4% -58.462 -8,6% -616.963

Total amounts due to customers 28.987.890 56,3% 28.716.895 57,8% 28.134.580 57,4% 853.310 3,0% 28.814.389

Bonds 19.388.341 37,6% 17.860.359 36,0% 17.593.778 35,9% 1.794.563 10,2% 18.946.038

Other certificates 3.149.560 6,1% 3.064.891 6,2% 3.257.147 6,7% -107.587 -3,3% 3.135.477

Total securities in issue 22.537.901 43,7% 20.925.250 42,2% 20.850.925 42,6% 1.686.976 8,1% 22.081.515

TOTAL DIRECT FUNDING 51.525.791 100,0% 49.642.145 100,0% 48.985.505 100,0% 2.540.286 5,2% 50.895.904

Figures in thousands of euro30.9.2006

A %31.12.2005 pro-forma

B30.6.2006%

30.9.2005 pro-forma

C

Changes A/C%

On aggregate “securities in issue” increased during the twelve month period by 8,1% to reach 22,5 billion. The increase in funding from securities was attributable principally to bonds, which increased by 1,8 billion (+10,2%), of which 1,2 billion related to issues made by the Parent Bank on international markets as part of the EMTN programme (Euro Medium Term Notes). As shown in the table 5, at the end of September existing stocks of those securities amounted to a total of 4.698 million euro, of which 1.040 million were subordinated. The increase, which amounted to 1.249 million, was the result of eight new issues for 2.305 million (two of which with second level subordination for 500 million and 300 million respectively and one with third level subordination for 200 million), redemptions/calls of 1.050 million (of which 530 million subordinated) and other decreases of 5,6 million euro. All the securities in the EMTN programme, for which the ceiling was raised from 28th July from 5 billion to 7 billion euro, in line with the plan for funding in 2006, are admitted for trading on the London Stock Exchange. In the light of the issues scheduled for 2007, in October the Board of Directors of BPU Banca resolved to raise the maximum limit for issues from 7 billion to 10 billion euro, which will only become effective if approved by the London Stock Exchange. To complete the information on the EMTN programme, BPU Banca made two new issues after the end of the third quarter: the first on 30th October 2006, for 300 million euro with a second level subordination clause and the second on the following 3rd November for 250 million.

* * * As concerns direct funding for the network banks only, operating figures for monthly averages in the first nine months of the year show that 80,2% of funding from customers came from the retail market, 10,9% from the private market and 8,9% from the corporate market. Finally table 7 shows the geographical distribution of traditional funding (consisting of current accounts, savings deposits and certificates of deposit) in Italy.

39

The data confirms the higher concentration in the regions of the North (62,5% of the total), the main markets for Banca Popolare di Bergamo and Banca Popolare Commercio e Industria, compared to southern regions (23,1%), where Banca Carime operates and Central Italy (14,4%), in which Banca Popolare di Ancona operates.

Table No. 7

Percentage of total 30.9.2006 30.6.2006 31.12.2005 30.9.2005

Lombardy 58,98% 58,13% 57,85% 56,30% Calabria 7,45% 7,34% 7,68% 7,88% Puglia 6,99% 6,96% 7,70% 7,31% Latium 6,82% 7,02% 6,95% 8,42% Marches 6,66% 6,81% 6,68% 6,89% Campania 6,14% 6,16% 6,16% 6,22% Piedmont 1,94% 2,45% 2,04% 2,09% Basilicata 1,41% 1,42% 1,43% 1,46% Emilia Romagna 1,00% 1,10% 0,95% 0,86% Umbria 0,89% 0,88% 0,87% 0,85% Abruzzo 0,64% 0,63% 0,61% 0,62% Molise 0,42% 0,40% 0,43% 0,41% Liguria 0,32% 0,32% 0,31% 0,32% Veneto 0,26% 0,30% 0,27% 0,29% Tuscany 0,06% 0,06% 0,05% 0,06% Sicily 0,02% 0,02% 0,02% 0,02%

Total 100,00% 100,00% 100,00% 100,00%

Geographical distribution of direct funding from customers by region of location of the branch (excluding repurchase agreements and bonds)

40

Indirect funding and assets under management At 30th September 2006, the Group’s indirect funding from ordinary customers had risen to 55,3 billion euro, to record an improvement over nine months of approximately 5% (+2,6 billion) and growth of 6% compared to September in the previous year (+3,1 billion). The trends for the aggregate are given in detail for each specific form in table 8, which shows positive percentage increases for all almost all the items, thanks to the recoveries recorded on financial markets in the third quarter of the year, after the losses suffered in May and June, which had penalised the prices of financial instruments. Generally the change in the composition of indirect funding continued with the move from assets under custody (22,9 billion) to assets under management (32,4 billion), which as a percentage of the total for the item rose progressively from 56,9% in September 2005 to 58,1% in December 2005 and to 58,4% in June 2006 to reach 58,7% last September. In accordance with the commercial strategy defined in the Industrial Plan, growth in the aggregate continues to be driven by the assets under management even if assets under custody recorded positive increases both on an annual basis (+1,6%) and compared to December 2005 (+3,6%, +0,8 billion). Operating figures for network banks showed that on average 64,9% of assets under management in the first nine months of the year were attributable to retail market customers, 34,5% to the private market and the remaining 0,6% to the corporate market. Assets under custody were 53,8% attributable to the retail market, 37,3% to the private market and attributable to the corporate market for the remaining 8,9%. Within assets under management, which increased during the twelve month period by 2,8 billion, +9,3%, progress was made by customer portfolio managements (+10,2% a 9,8 billion), by mutual investment funds attributable to BPU Pramerica SGR, the most significant part of the total funds item (+13% to 13,6 billion) and by insurance policies, up by more than 17% to 5,2 billion. Given the expectations of a rise in market rates there is a change in progress in the composition of the different types of funds contained in the item mutual funds which on the basis of the operating figures for network bank customers revealed the following positioning at the end of September 2006. Although bond funds remained the preferred category, they had contracted considerably, falling from 50% at the end of 2005 to approximately 39% at present in line with what happened in the industry as a whole. Indirect funding from ordinary customers

Table No. 8

absolute % absolute %

Assets under custody 22.850.216 41,3% 22.052.558 41,9% 797.658 3,6% 22.481.751 368.465 1,6% 22.366.578

Assets under management 32.412.890 58,7% 30.636.062 58,1% 1.776.828 5,8% 29.650.986 2.761.904 9,3% 31.400.485

Customer portfolio management 9.846.283 17,8% 9.190.947 17,4% 655.336 7,1% 8.931.953 914.330 10,2% 9.659.432

of which: fund based instruments 4.133.310 7,5% 3.884.153 7,4% 249.157 6,4% 3.811.969 321.341 8,4% 4.155.416

Mutual funds 16.299.768 29,5% 15.834.161 30,1% 465.607 2,9% 15.297.489 1.002.279 6,6% 15.685.120

of which: BPU Pramerica SGR 13.585.730 24,6% 12.690.330 24,1% 895.400 7,1% 12.017.840 1.567.890 13,0% 13.159.439

Insurance policies and pension funds 5.279.324 9,6% 4.673.623 8,9% 605.701 13,0% 4.509.950 769.374 17,1% 5.095.632

of which: Insurance policies 5.201.101 9,4% 4.601.439 8,7% 599.662 13,0% 4.441.590 759.511 17,1% 5.020.862

Sicav’s (and other) 987.515 1,8% 937.331 1,7% 50.184 5,4% 911.594 75.921 8,3% 960.301

Total ordinary customers 55.263.106 100,0% 52.688.620 100,0% 2.574.486 4,9% 52.132.737 3.130.369 6,0% 53.767.063

30.9.2005 C

Figures in thousands of euro 30.6.200630.9.2006A

31.12.2005B %%

Changes A/B Changes A/C

41

Balanced funds improved (from 15% to 17%), as did monetary funds (from 15% to 18%) and flexible funds11 (up by 2% to 8%). Equities on the other hand were unchanged (18%). The section “Figures for the principal companies in the BPU Banca Group” contains a table summarising the changes in indirect funding and assets under management for each subsidiary. The figures are stated net of bonds held in custody issued by the Bank, while consolidated indirect funding is stated net of bond loans held in custody issued by Group member companies. The consolidated aggregate was obtained from the sum of the figures for individual companies, with intragroup sums eliminated appropriately. The figures show differentiated performance for individual companies, which is greatest for assets under management of the network banks (BPB +10,9%, BPCI +10,8%, BPA +8,6%) and more general for the specialist product companies (BPU Pramerica SGR +13,3%, BPU Assicurazioni Vita +6,5% and Aviva Vita +51,9%). Again in the assets under management sector, even more significant increases were also recorded by the BPU Sim network of financial advisors (+23,6%) and by the online bank IW Bank (+163%).

11 The flexible funds are of recent constitution and are similar to balanced funds, because they can hold both equities

and bonds in their portfolios, but as opposed to balanced funds, there is no limit on the maximum percentage of equities they may hold. They have no benchmark.

42

Lending Composition of loans to customers

Table No. 9

absolute %

Current accounts 9.810.604 19,7% 9.273.878 19,6% 8.925.473 19,9% 885.131 9,9% 9.996.682

Repurchase agreements - - - - - - - - -

Mortgage loans 25.313.923 50,8% 23.054.793 48,6% 21.978.173 48,9% 3.335.750 15,2% 24.355.619

Credit cards, personal loans and waged backed loans 1.333.360 2,7% 1.069.441 2,3% 989.639 2,2% 343.721 34,7% 1.276.801

Financial leasing 3.261.205 6,5% 3.098.535 6,6% 2.922.837 6,5% 338.368 11,6% 3.274.642

Factoring - - - - - - - - -

Debt securities 101.558 0,2% 87.159 0,2% 185.599 0,4% -84.041 -45,3% 115.057

Other transactions 8.949.364 18,0% 9.348.665 19,8% 8.780.423 19,6% 168.941 1,9% 9.539.331

Assets transferred not derecognised - - - - - - - - -

Impaired assets 1.028.304 2,1% 1.368.344 2,9% 1.136.828 2,5% -108.524 -9,5% 1.025.198

TOTAL 49.798.318 100,0% 47.300.815 100,0% 44.918.972 100,0% 4.879.346 10,9% 49.583.330

30.6.2006Changes A/C30.9.2005

pro-formaC

Figures in thousands of euro 30.9.2006A %

31.12.2005pro-forma

B% %

Growth in traditional banking business was particularly significant with regard to lending to customers. At 30th September 2006 the Group’s lending portfolio had reached 49,8 billion, with an increase on an annual basis of close to 11% (+11,5% net of impaired loans). As can be seen from the table contained in the subsequent section “Figures on the principal companies in the BPU Banca Group”, all the banks and the specialist companies recorded good performance for lending activity with positive contributions to the growth in the consolidated aggregate, although to differing degrees. As concerns the different forms, growth in Group lending continued to be driven, in line with the trend for the banking industry, by the long term component and by mortgage loans in particular (+3,3 billion), which now account for more than 50% of the total12. A significant contribution was made by current account overdrafts (+885 million), by the different types of consumer credit (+344 million) and by leasing (+338 million). The positive trend for lending “under conventions”, which is to say providing loans on the basis of agreements with guarantee bodies and business associations, also continued. In fact new medium to long term loans granted increased by approximately 24% in the first nine months of 2006 compared to the same period in 2005 (from 415 million to 515 million euro) allowing the stock of loans to reach a total of almost 1,4 billion at the end of September 2006 (+15% compared to December). Short term lending, however, remained more or less unchanged at 252 million. As concerns customers by market segment, the results in the first nine months for average monthly volumes for network banks show that 57,9% of lending was to the retail segment, 41,4% to the corporate market and the remaining 0,7% to the private market.

12 The offer of a new formula named “Twin” for private customers began on 16th October 2006, which combines a

variable rate mortgage with a bundled “Duetto” account. With a Twin mortgage the interest accruing on the linked current account, calculated at the rate set for the loan net of the withholding tax, is deducted from the next quarterly repayment rate (reduced instalment option) or alternatively is deducted from the remaining principal of the loan, with immediate recalculation of the repayment schedule and reduction of the life of the loan at the same time (reduced life option).

43

From the viewpoint of risk concentration, the data contained in Table 10 relating to 30th September 2006, not only confirms the particular attention paid by the Group to fractioning risk, but it also benefited from a temporary decrease in borrowing by some major corporate clients. With regard periodic supervisory reporting of “large exposures”, at the end of the third quarter the Group had four positions amounting to more than 10% of the consolidated supervisory capital for a total of approximately 2,5 billion euro. There were the same number, four positions totalling 2,6 billion, reported at the end of first half. As in June the first two positions, both regarding major insurance groups, related to investments in capitalisation certificates.

Table 11 shows that Group lending in Italy is located mainly in Lombardy, the traditional operating area for Banca Popolare di Bergamo and Banca Popolare Commercio e Industria. At the end of September, 75,2% of the total was destined to northern regions, compared to 13,8% for central regions, the main operating area for Banca Popolare di Ancona and 11% for southern regions in which Banca Carime operates. As part of the action designed to improve the general quality of credit, after the two disposals en

bloc of non performing mortgage loans concluded during the first half by Centrobanca and by the network banks for a total book value of 140,8 million euro and with a net profit on the sale of 35,5 million euro (see the Consolidated Half Year Report as at 30th June 2006 for details), a further five operations were performed in the third quarter. These concerned individual positions which resulted in a total profit on the sale of approximately 3 million. In detail, Centrobanca sold three positions with a book value of 22,8 million (a profit on the sale of more than 1,8 million), while Banca Popolare di Bergamo sold two positions with a book value of 15,8 million (a profit on the sale of more than 1,1 million). As a result, amongst other things, of these disposals, at the end of September all the main risk ratios at consolidated level recorded improvement (as shown in Table 12, which relates to asset item 70 on the balance sheet “loans to customers” only) with a progressive convergence of Centrobanca on average Group levels. The ratio of net non performing loans to lending at the end of period had reached 0,71%, down from 0,95% at 31st December 2005 and from 1,24% in September 2005. If Centrobanca is excluded the percentage of net non performing loans was 0,63% (0,71% at the end of 2005 and 0,97% in September 2005). The percentage of net impaired loans also fell, down to 0,91% from 1,08% in December and from 1,15% in September 2005 (0,91% if Centrobanca is excluded, compared to 1,04% in the Autumn of 2005 and 1,01% at the end of the year). As concerns positions past due, overdue and in arrears by more than 180 days (included among doubtful loans since December 2005 and therefore still reported as performing loans at

Table No. 10

Customers or Groups

30.09.2006 30.6.2006 31.12.2005

Largest 10 5,6% 6,3% 6,0%

Largest 20 8,8% 9,4% 9,2%

Largest 30 10,9% 11,6% 11,4%Largest 40 12,5% 13,3% 13,1%Largest 50 13,7% 14,5% 14,3%

Concentration of risk (percentage of largest customers or groups out of total loans and guarantees)

Table No. 11

P ercentage o f to tal 30.9.2006 30.6.2006 31.12.2005 30.9.2005

Lombardy 67,96% 67,79% 68,33% 67,76% Marches 8,23% 8,24% 8,74% 8,91% Latium 4,37% 4,48% 4,29% 4,34% Piedmont 3,64% 3,79% 3,57% 3,74% Campania 3,18% 3,17% 3,09% 3,07% Puglia 2,91% 2,86% 2,77% 2,80% Calabria 2,72% 2,76% 2,71% 2,81% Emilia Romagna 2,53% 2,50% 2,11% 2,06% Abruzzo 1,05% 1,06% 1,09% 1,09% Umbria 1,02% 0,99% 0,94% 0,93% Basilicata 0,63% 0,65% 0,64% 0,63% Liguria 0,59% 0,53% 0,52% 0,65% Veneto 0,48% 0,49% 0,50% 0,51% Molise 0,46% 0,46% 0,46% 0,47% Tuscany 0,17% 0,17% 0,18% 0,17% Sicily 0,06% 0,06% 0,06% 0,06%

Total 100,00% 100,00% 100,00% 100,00%

Geographical distribution of loans to customers by region where branch is located

44

30th September 2005), the aggregate decreased significantly from 368 million to 196 million in the first nine months of the year as a result, amongst other things, of targeted intervention at Group level. It therefore fell from 0,78% to 0,39% of net lending. As concerns the coverage for loans, while performing loans remained basically stable (0,26% against 0,28% in December), that for doubtful loans increased to 38,03% from 36,39% at the end of 2005. The coverage for non performing loans in particular increased from 57,32% to 58,64% while that for impaired loans fell from 23,75% to 19,76%. Loans to customers as at 30th september 2006 Table No. 12a

Figures in thousands of euro Net impairment losses

Doubtful loans (3,29%) 1.665.635 633.369 (2,07%) 1.032.266 - Non performing loans (1,69%) 856.780 502.397 (0,71%) 354.383

- Impaired loans (1,11%) 562.943 111.264 (0,91%) 451.679

- Restructured loans (0,08%) 39.483 12.922 (0,05%) 26.561

- Past due loans (0,40%) 202.260 6.579 (0,39%) 195.681

- Unsecured loans to countries at risk (0,01%) 4.169 207 (0,01%) 3.962

Performing loans (96,71%) 48.892.802 126.750 (97,93%) 48.766.052

TOTAL 50.558.437 760.119 49.798.318 The figures in brackets show each item’s share of the total

Loans to customers as at 30th June 2006 Table No. 12b

Figures in thousands of euro Net impairment losses

Doubtful loans (3,31%) 1.666.124 636.908 (2,08%) 1.029.216 - Non performing loans (1,62%) 814.762 483.545 (0,67%) 331.217

- Impaired loans (1,19%) 598.266 136.720 (0,93%) 461.546

- Restructured loans (0,08%) 41.033 13.059 (0,06%) 27.974

- Past due loans (0,41%) 207.833 3.372 (0,41%) 204.461

- Unsecured loans to countries at risk (0,01%) 4.230 212 (0,01%) 4.018

Performing loans (96,69%) 48.677.609 123.495 (97,92%) 48.554.114 TOTAL 50.343.733 760.403 49.583.330 The figures in brackets show each item’s share of the total

Loans to customers as at 31st December 2005 pro-forma Table No. 12c

Figures in thousands of euro Net impairment losses

Doubtful loans (4,46%) 2.151.111 782.767 (2,89%) 1.368.344 - Non performing loans (2,19%) 1.058.160 606.566 (0,95%) 451.594

- Impaired loans (1,38%) 667.340 158.498 (1,08%) 508.842

- Restructured loans (0,09%) 40.734 12.161 (0,06%) 28.573

- Past due loans (0,78%) 373.414 5.318 (0,78%) 368.096

- Unsecured loans to countries at risk (0,02%) 11.463 224 (0,02%) 11.239

Performing loans (95,54%) 46.061.631 129.160 (97,11%) 45.932.471

TOTAL 48.212.742 911.927 47.300.815 The figures in brackets show each item’s share of the total

Loans to customers as at 30th September 2005 pro-forma Table No. 12d

Figures in thousands of euro Net impairment losses

Doubtful loans (4,17%) 1.910.091 796.733 (2,48%) 1.113.358 - Non performing loans (2,56%) 1.171.035 615.217 (1,24%) 555.818

- Impaired loans (1,50%) 687.412 170.166 (1,15%) 517.246

- Restructured loans (0,09%) 42.312 11.250 (0,07%) 31.062

- Unsecured loans to countries at risk (0,02%) 9.332 100 (0,02%) 9.232

Performing loans (*) (95,83%) 43.949.626 144.012 (97,52%) 43.805.614

TOTAL 45.859.717 940.745 44.918.972 The figures in brackets show each item’s share of the total(*) Also includes past due loans

Gross exposure Carrying value

Gross exposure Carrying value

Gross exposure Carrying value

Gross exposure Carrying value

45

The interbank market Group activity on the interbank market at the end of September recorded net indebtedness of 4,7 billion, having increased progressively over twelve months (Table 13). It reflects, on the one hand, a decrease in the portfolio of loans to banks following the change in the composition of investments away from the interbank market towards lending activity with customers and towards the portfolio of financial assets and, on the other hand, a tendency to increase recourse to interbank funding in a context of combined sources to finance growth in lending and in investments in financial activities. At the date of this report the net indebted position of the Group had decreased significantly in relation to the positive performance of direct funding, and that performed under the EMTN programme in particular, and also in relation to the decrease in investments in financial activities. Net interbank position Table No. 13

Figures in thousands of euro30.9.2006

A

31.12.2005pro-forma

B

30.9.2005pro-forma

C

Loans to banks 1.907.591 3.321.395 -1.413.804 -42,6% 4.115.040 Amounts due to banks 6.607.514 6.366.914 240.600 3,8% 5.046.288

NET INTERBANK POSITION -4.699.923 -3.045.519 -1.654.404 54,3% -931.248

Changes A/B absolute %

Amounts due to banks: composition Table No. 14

absolute %

1. Due to central banks 214.640 3,3% 250.043 3,9% -35.403 -14,2% - 2. Due to banks 6.392.874 96,7% 6.116.871 96,1% 276.003 4,5% 5.046.288

2.1 1. Current accounts and deposits 4.585.934 69,4% 4.955.117 77,8% -369.183 -7,5% 2.284.719 2.2 Time deposits 786.299 11,9% 391.336 6,2% 394.963 100,9% 1.606.732 2.3 Financing 808.012 12,2% 317.139 5,0% 490.873 154,8% 705.961

2.3.1 financial leasing - - 129 0,0% -129 -100,0% -

2.3.2 other 808.012 12,2% 317.010 5,0% 491.002 154,9% 705.961

2.4 Amounts due for commitments to repurchase own equity instruments

- - - - - - -

2.5 Liabilities relating to assets transferred not derecognised in the accounts

179.835 2,7% - - 179.835 - -

2.6 Other payables 32.794 0,5% 453.279 7,1% -420.485 -92,8% 448.876

TOTAL 6.607.514 100,0% 6.366.914 100,0% 240.600 3,8% 5.046.288

30.9.2005 pro-forma

CFigures in thousands of euro 30.9.2006

A %31.12.2005pro-forma

B%

Changes A/B

Lending to banks: composition Table No. 15

absolute %

A. Loans to central banks 222.210 11,6% 256.272 7,7% -34.062 -13,3% 107.661 1. Time deposits - - - - - - - 2. Compulsory reserve requirement 220.578 11,5% 256.236 7,7% -35.658 -13,9% 107.661 3. Repurchase agreements - - - - - - - 4. Other 1.632 0,1% 36 0,0% 1.596 n.s. -

B. Loans to banks 1.685.381 88,4% 3.065.123 92,3% -1.379.742 -45,0% 4.007.379 1. Current accounts and deposits 783.599 41,1% 711.994 21,4% 71.605 10,1% 2.416.286 2. Time deposits 734.349 38,5% 1.411.021 42,6% -676.672 -48,0% 1.013.421 3. Other financing 167.394 8,8% 866.557 26,1% -699.163 -80,7% 544.966 4. Debt securities - - 74.544 2,2% -74.544 -100,0% 32.669 5. Impaired assets 39 0,0% 1.007 0,0% -968 -96,1% 37 6. Assets transferred not derecognised - - - - - - -

TOTAL 1.907.591 100,0% 3.321.395 100,0% -1.413.804 -42,6% 4.115.040

Figures in thousands of euro 30.9.2006A %

31.12.2005pro-forma

B%

30.9.2005 pro-forma

C

Changes A/B

46

Financial activities At the end of September the Group held financial assets totalling 13,1 billion euro, an increase of 8% compared to 12,1 billion at 31st December 2005. Net of financial liabilities, consisting almost entirely of financial derivatives held for trading, the aggregate amounted to 12.677 million euro (11.801 million at the end of 2005). If only that part of the portfolio concerning securities only is considered (i.e. excluding derivatives and equity investments from financial activities), operating figures show that: - in terms of type of financial instrument, more than 44% of the securities portfolio of the

Group at 30th September 2006 was composed of capitalisation certificates, 40% of government bonds, more than 8% of corporate bonds and the remaining part was composed of asset backed securities [ABS - financial instruments issued for securitisation transactions), funds and equities;

- from a financial viewpoint, in addition to the predominance of capitalisation certificates, fixed rate bonds accounted for more than 26% of the portfolio, variable rate for 15% and structured instruments for less than 8%, while the remaining part is composed of equities, funds and convertible bonds;

- as concerns the reference currency, more than 99% of the securities were in euro, while with regard to geographical distribution, approximately 96% of the investments are located in the euro area and 2% in USA securities;

- an analysis by rating (excluding capitalisation certificates and the Orio securitisations) reveals that 97% of the portfolio consists of “investment grade” securities with an average rating of A1.

Financial assets/liabilities of the Group Table No. 16

absolute %

Financial assets held for trading 3.055.892 2.208.420 847.472 38,4% 6.987.925

Financial assets at fair value 5.290.972 5.158.686 132.286 2,6% -

Available-for-sale financial assets 3.552.858 3.721.162 -168.304 -4,5% 3.329.610

Held-to-maturity financial assets 1.227.145 1.061.634 165.511 15,6% 998.965

TOTAL FINANCIAL ASSETS 13.126.867 12.149.902 976.965 8,0% 11.316.500Financial liabilities 449.994 348.941 101.053 29,0% 409.504TOTAL 12.676.873 11.800.961 875.912 7,4% 10.906.996

30.9.2005pro-forma

(c)Figures in thousands of euro

30.9.2006(a)

31.12.2005pro-forma

(b)

Changes (a/b)

47

Financial instruments held for trading and Financial assets at Fair Value (asset items 20 and 30 and liability item 40) The item “Financial assets held for trading” (asset item 20) includes financial trading instruments “used to generate a profit from short term fluctuations in price or from a dealer’s margin”. They are valued at fair value through profit or loss – FVPL. The Group has included the following among these assets:

- securities held in the “dealing portfolio”, held to support and co-ordinate baskets of investments for the network banks (excluding own issued bonds);

- securities in the “asset allocation portfolio”, for the purpose of optimising the risk/yield profile;

- securities in the “alternative investment portfolio”, with the objective of total return; - a part of the securities in the “strategic portfolio” (portfolio with the objective of stabilising

income for the year) consisting of ABS (151 million existing at 30th September and 586 million at 31st December 2005);

- equity investments other than those classified as controlling interests, acquired as part of merchant banking and private equity activities.

The item “Financial assets at fair value” (asset item 30) includes financial instruments designated by the Bank as such in application of fair value options (FVO). These assets are also valued at fair value through profit or loss. Since 30th June 2006 the BPU Group has included exclusively investments in capitalisation policies in this category. These policies, previously recognised under “financial assets held for trading”, are now subject to the fair value option because they are hybrid contracts containing embedded derivatives, which significantly alter the cash flow otherwise generated by the contract. Financial assets held for trading and carried at fair value (asset items 20 and 30)

Table No. 17

30.9.2005 pro-forma

Listed Unlisted Total (a) Listed Unlisted Total (b) absolute % Total (c)

Financial assets held for trading (asset item 20)

A. Assets

1. Debt securities 1.503.325 409.965 1.913.290 729.528 715.683 1.445.211 468.079 32,4% 6.281.6252. Equities 415.456 84.362 499.818 55.381 91.167 146.548 353.270 241,1% 149.6183. Units in O.I.C.R. (collective investment instruments). - 224.647 224.647 - 253.206 253.206 -28.559 -11,3% 196.819

4. Financing - - - - - - - - - 5. Impaired assets - - - - 1.537 1.537 -1.537 -100,0% -

6. Assets transferred not derecognised - - - - - - - - -

Total A 1.918.781 718.974 2.637.755 784.909 1.061.593 1.846.502 791.253 42,9% 6.628.062

B.Derivative instruments

1. Financial derivatives 127.122 291.015 418.137 149.647 212.137 361.784 56.353 15,6% 359.7322. Credit derivatives - - - - 134 134 -134 -100,0% 131Total B 127.122 291.015 418.137 149.647 212.271 361.918 56.219 15,5% 359.863TOTAL (A+B) 2.045.903 1.009.989 3.055.892 934.556 1.273.864 2.208.420 847.472 38,4% 6.987.925

Financial assets at fair value (asset item 30)

Debt securities - 5.290.972 5.290.972 - 5.158.686 5.158.686 132.286 2,6% -

TOTAL asset item 20 + item 30 2.045.903 6.300.961 8.346.864 934.556 6.432.550 7.367.106 979.758 13,3% 6.987.925

Figures in thousands of euro30.9.2006

31.12.2005 pro-forma

Changes (a/b)

The total for financial assets held for trading and those at fair value (asset items 20 and 30) rose from 7.367 million to 8.347 million in the nine month period.

48

The increased investment of almost one billion euro is related primarily to the new investments in the portfolios that BPU Banca, Banca Carime and Banca Popolare di Ancona have entrusted to the Group’s asset management company to manage, to purchases of government bonds and to the higher value of capitalisation insurance certificates. Under the management mandate granted to the Group’s asset management company to invest up to a maximum of 1,6 billion, approximately 70% had been invested at the end of the quarter, of which two thirds in European government bonds and one third in equities. As can be seen from Table 17, investments in equities rose from 147 million at 31st December 2005 to approximately 500 million, with an increase of 353 million attributable: - for the main part to the investments already mentioned in the portfolios entrusted to the

Group’s asset management company to manage, as part of an agreed strategy of investing in equities selected according to qualitative and quantitative criteria for which simultaneous hedging of system risk was performed;

- for a residual part to higher investments in equities other than those classified as controlling interests, acquired as part of merchant banking and private equity activities (84,4 million compared to 76,8 million at the end of 2005).

As concerns capitalisation policies existing at the end of September, these amounted to 5.291 million (4.786 million the nominal value invested plus interest maturing and settled), a slight increase compared to 5.159 million at the end of 2005 (4.781 million nominal value). In the third quarter of the year surrender options were exercised for three policies held by the Parent Bank for a nominal investment of 175 million and another three policies held by Centrobanca for a nominal value of 50 million. Investments in new policies over the nine month period were made by both the Parent Bank, which took out eight new policies for a total of 130 million (seven of which in the first half, for 115 million euro) and by Centrobanca, which purchased a policy worth 100 million (again in the first half). The remaining change in the total investment in capitalisation certificates is to be attributed to the value of interest matured and settled. In order to reduce the absorption of investment capital by the capitalisation certificates, credit default swap contracts existed for 2,1 billion euro (2 billion at the end of 2005 also). This investment in insurance policies, all issued by major insurance companies, is designed to furnish a positive and stable contribution to the generation of net interest income.

* * * Financial liabilities held for trading: composition (liability item 40)

Table No. 18

30.9.2005 pro-forma

Listed Unlisted Total (a) Listed Unlisted Total (b) absolute % Total (c)

A. Cash liabilities1. Due to banks - 5 5 - - - 5 - - 2. Due to customers 4 18 22 - - - 22 - - 3. Debt securities - - - - - - - - -

Total A 4 23 27 - - - 27 - - B.Derivative instruments1. Financial derivatives 192.520 256.899 449.419 132.260 216.164 348.424 100.995 29,0% 408.9992. Credit Derivatives - 548 548 - 517 517 31 6,0% 505

Total B 192.520 257.447 449.967 132.260 216.681 348.941 101.026 29,0% 409.504TOTAL (A+B) 192.524 257.470 449.994 132.260 216.681 348.941 101.053 29,0% 409.504

Changes (a/b)Figures in thousands of euro

30.9.200631.12.2005 pro-forma

49

Available for sale financial assets (Asset item 40) This category of financial assets (Available for sale - AFS) includes: - a part of the securities in the “strategic portfolio” consisting of bonds and funds; - financial assets of IW Bank and of insurance companies; - shareholdings that are not classified as controlled equity investments and are not held for

merchant banking and private equity activities. These assets are measured at fair value with the recognition of changes in the specific valuation reserve in shareholders’ equity. Available-for-sale financial assets: composition

Table No. 19

30.9.2005 pro-forma

Listed Unlisted Total (a) Listed Unlisted Total (b) absolute % Total (c)

1. Debt securities 2.813.547 530.212 3.343.759 2.602.988 841.919 3.444.907 -101.148 -2,9% 3.101.9792. Equities 32.835 99.982 132.817 126.215 71.850 198.065 -65.248 -32,9% 164.1213. Units in O.I.C.R. (collective investment instruments). 31.733 44.549 76.282 33.327 44.863 78.190 -1.908

-2,4%63.510

4. Financing - - - - - - - - - 5. Impaired assets - - - - - - - - -

6. Assets transferred not derecognised - - - - - - - - -

TOTAL 2.878.115 674.743 3.552.858 2.762.530 958.632 3.721.162 -168.304 -4,5% 3.329.610

Figures in thousands of euro30.9.2006

31.12.2005 pro-forma Changes (a/b)

There was a reduction in “available-for-sale financial assets” in the first nine months of 2006 of 4,5%, due mainly to a decrease in investments in debt securities in the strategic AFS portfolio. At the end of September available-for-sale financial assets had fallen to 3.553 million from 3.721 million at the end of year. The effect of the change in the value of these assets, accounted for at fair value with recognition in shareholders’ equity under the item “valuation reserves”, had a net positive impact of 21 million euro (see Table 39 “Valuation reserves for available-for-sale financial assets”, in the section “Shareholders’ equity and capital adequacy”). Debt securities decreased from 3.445 million to 3.344 million, down by 101 million, of which approximately 7 million due to changes in fair value. In addition to the normal movements of purchase and sale of securities, a bond of 340 million euro also matured in February 2006. It was issued by Banca Intesa in 2002, when the legal title only of 25,1262% of Banca Carime was sold to Deutsche Bank Ag., and subscribed by the former Banca Popolare Commercio e Industria Scrl. Debt securities include almost the whole of IW Bank’s portfolio (held to stabilise that bank’s net interest income given the particular nature of its typical operations) which rose from 94 million in December 2005 to 363 million at the end of September. The part relating to investments made by the Group’s insurance companies amounted to 2,4 billion (2,3 billion in December 2005) and it consisted mainly of securities issued by governments and supra-national bodies. Investment in equities also fell substantially from198 million at the end of the year to 133 million. The change is attributable mainly to the disposal of equity investments in Banca Italease Spa, SI Holding Spa, Esatri Spa and part of the interests held in Meliorbanca Spa and CIM Italy Spa for a total of 102 million (see the section “The rationalisation of equity investments”) and was partially offset by an increase in fair value of approximately 31 million.

50

Held-to-maturity financial assets (Asset item 50) This category of assets (held-to-maturity – HTM) includes securities from the former fixed assets portfolio. Held-to-maturity financial assets: composition

Table No. 20

absolute %

1. Debt securities 1.227.145 1.061.634 165.511 15,6% 998.9652. Financing - - - - - 3. Impaired assets - - - - - 4. Assets transferred not derecognised - - - - - TOTAL 1.227.145 1.061.634 165.511 15,6% 998.965

30.9.2005pro-forma

(c)

Changes (a/b)Figures in thousands of euro

30.9.2006(a)

31.12.2005pro-forma

(b)

It will be recalled that the general resolution of 11th September 2003 specified a maximum limit to the size of the fixed asset portfolio amounting to 2,5 billion, net of securities issued by companies of the Group, which in the light of the new IAS classifications and the choices made on first time adoption is to be intended as relating to the HTM category. This limit has not yet been reached because new investments were deferred, as made convenient by rising interest rates. In fact at 30th September 2006, held-to-maturity financial assets, all held by the Parent Bank, amounted to 1.227 million, an increase compared to approximately 1.061 million at the end of 2005, the result of the combined effect of new investments in government securities and natural maturities. Hedged and unhedged financial assets Hedged and unhedged financial assets and liabilities

Table No. 21

FV CF

Financial assets portfolio- Item 40 Available-for-sale financial assets 164.174 - 3.388.684 3.552.858 - Item 50 Held-to-maturity financial assets - - 1.227.145 1.227.145 - Item 60 Loans to banks 60.811 - 1.846.780 1.907.591 - Item 70 Loans to customers 108.213 - 49.690.105 49.798.318 - Item 100 Equity investments - - 46.738 46.738

Financial liabilities portfolio- Item 10 Due to banks - - 6.607.514 6.607.514 - Item 20 Due to customers - - 29.607.923 29.607.923 - Item 30 Securities in issue 7.942.422 - 14.595.479 22.537.901

Financial assets existed amounting to 1.065.638 thousand euro for which fair value macro hedges had been employed. Financial assets also existed amounting to 600 million euro for which cash flow macro hedges had been employed.

specific hedgesTotal

Assets/Liabilities not hedged

Figures in thousands of euro

51

Equity investments The item 100 on the balance sheet “equity investments”, which includes companies subject to significant influence e consolidated using the equity method (listed in the initial section “The consolidation area”) amounted to 46,7 million euro at 30th September 2006 compared to 32,8 million recorded in December 2005 (+13,9 million the total increase over nine months). Most of the increase was attributable to two increases in share capital for a total of 10 million euro related to growth in volumes of business by the joint venture Aviva Vita Spa. The first increase in the share capital occurred with a shareholders’ resolution of 11th January 2006 which involved a capital payment of 5 million euro. The second increase, however, was the result of a more complex recapitalisation plan decided by a shareholders’ meeting of 20th April 2006 for a total of 30 million euro (to be completed by 31st December 2007). The first tranche of 10 million was subscribed on that same date by both shareholders who contributed 50% each. Profits for the period earned by companies must also be added to these extraordinary operations and they amounted to a total of approximately 6 million euro of which 3,4 million relating to Arca SGR and 2,5 million to Aviva Vita itself. There was also a decrease in the item, however, as a result of dividends relating to 2005 received during the first nine months of the year, which amounted to 1,9 million and related almost entirely to Arca SGR Spa. The additional marginal decreases relate to disposals, some partial, which occurred during the period in question. No permanent value impairments were recognised during the period January-September.

52

Tangible and intangible assets This section furnishes information on acquisitions and disposals of property, plant and equipment (as specified by IAS 34 – Par. 17 d)) as well as commitments to purchase property, plant and equipment (pursuant to IAS 34 – Par. 17 e)).

Table No. 22

Figures in thousands of euro 30.9.2006 31.12.2005

A. Assets used in operations1.1 owned 1.240.501 1.251.047

a) land 441.933 434.229b) buildings 682.372 689.016 c) furnishings 24.976 27.291d) electronic equipment 67.110 73.976e) other 24.110 26.535

1.2 acquired through financial leasing 27.843 33.539a) land 7.533 9.491b) buildings 12.014 16.135 c) furnishings 10 4d) electronic equipment 12 8e) other 8.274 7.901

Total A 1.268.344 1.284.586B. Assets held for invesment

2.1 owned 79.813 92.540a) land 35.927 41.135 b) buildings 43.886 51.405

2.2 acquired through financial leasing - 267 a) land - 42 b) buildings - 225

Total B 79.813 92.807Total (A+B) 1.348.157 1.377.393

Tangible assets: composition of assets valued at cost

Commitments for the purchase of tangible assets Table No. 23

Figures in thousands of euro 30.9.2006 31.12.2005

A. Assets used in operations1.1 owned 12.003 3.471

- land - - - buildings 4.469 2.630 - furnishings 578 68- machinery 5.787 22- electronic equipment 1.131 751- other 38 -

1.2 financial leasing - - - land - - - buildings - - - furnishings - - - machinery - - - electronic equipment - - - other - -

Total A 12.003 3.471B. Assets held for invesment

2.1 owned - - - land - - - buildings - -

2.2 financial leasing - - - land - - - buildings - -

Total B - - Total (A+B) 12.003 3.471

53

Tangible assets for operational use: changes in the periodTable No. 24

Figures in thousands of euroLand Buildings Furnishings

Electronic equipment

Other Total 30.9.2006

A. Initial gross holdings as at 31st December 2005 443.989 1.139.464 123.502 315.856 128.079 2.150.890A.1 Total net reductions in value -269 -434.313 -96.207 -241.872 -93.643 -866.304

A.2 Initial net holdings as at 31st December 2005 443.720 705.151 27.295 73.984 34.436 1.284.586B. Increases 6.403 16.796 3.040 14.588 6.761 47.588 B.1 Purchases 27 1.452 2.089 14.186 5.858 23.612B.2 Capitalised improvement expenses - 9.119 - - - 9.119B.3 Value recoveries - - - - - - B.4 Positive changes in fair value recognised in: - - - - - -

a) shareholders’ equity - - - - - - b) income statement - - - - - -

B.5 Positive exchange rate differences - - 17 110 - 127

B.6 Transfers from properties held for investment 5.520 6.204 - - - 11.724 B.7 Other changes 856 21 934 292 903 3.006C. Decreases -657 -27.561 -5.349 -21.450 -8.813 -63.830 C.1 Sales - - -100 -231 -126 -457 C.2 Depreciation - -25.753 -4.900 -20.318 -7.487 -58.458 C.3 Net impairment losses recognised in: - - - - - -

a) shareholders’ equity - - - - - - b) income statement - - - - - -

C.4 Negative changes in fair value - - - - - - a) shareholders’ equity - - - - - - b) income statement - - - - - -

C.5 Negative exchang rate differences -291 -440 -27 -169 -1 -928 C.6 Transfers to: -157 -362 - - - -519

a) tangible assets held for investment -157 -362 - - - -519 b) assets held for sale - - - - - -

C.7 Other changes -209 -1.006 -322 -732 -1.199 -3.468

D. Final net holdings 449.466 694.386 24.986 67.122 32.384 1.268.344

D.1 Total net reductions in value 254 463.602 101.166 258.024 99.506 922.552

D.2 Final gross holdings 449.720 1.157.988 126.152 325.146 131.890 2.190.896

Table No. 25

Land BuildingsA. Initial gross holdings as at 31st December 2005 41.199 65.328A.1 Total net reductions in value -22 -13.698A.2 Initial net holdings as at 31st December 2005 41.177 51.630B. Increases 803 1.229B.1 Purchases 646 817 B.2 Capitalised improvement expenses - 50 B.3 Net positive changes in fair value - - B.4 Value recoveries - - B.5 Positive exchange rate differences - - B.6 Transfers from properties used in operations 157 362 B.7 Other changesC. Decreases -6.053 -8.973C.1 Sales -533 -734 C.2 Depreciation - -2.012 C.3 Net negative changes in fair value - - C.4 Net impairment losses - - C.5 Negative exchang rate differences - - C.6 Transfers to other asset portfolios -5.520 -6.204

a) properties for operational use -5.520 -6.204 b) non current assets held for disposal - -

C.7 Other changes - -23 D. Final holdings 35.927 43.886

D.1 Total net reductions in value 16 10.961

D.2 Final gross holdings 35.943 54.847

Figures in thousands of euro

30.9.2006

Tangible assets held for investment: changes in the period

54

Table No. 26

Figures in thousands of euro Finite life Indefinite life Finite life Indefinite life

A.1 Goodwill - 1.209.622 - 1.195.299A.1.1 attributable to the Group - 1.110.985 - 1.096.603A.1.2 attributable to other shareholders - 98.637 - 98.696

A.2 Other intangible assets 50.045 37 41.710 37 A.2.1 Assets valued at cost: 50.045 37 41.710 37

a) internally generated intangible assets 1.047 - 1.519 - b) other assets 48.998 37 40.191 37

A.2.2 Assets at fair value - - - - a) internally generated intangible assets - - - - b) other assets - - - -

Total 50.045 1.209.659 41.710 1.195.336

30.9.2006 31.12.2005

Intangible assets: composition by type of asset

Intangible assets: changes in the period

Table No. 27

Finite lifeIndefinite

lifeFinite life

Indefinite life

A. Initial holdings as at 31st December 2005 1.491.931 2.847 - 68.024 37 1.562.839A.1 Total net reductions in value -296.632 -1.328 - -27.833 - -325.793A.2 Initial net holdings as at 31st December 2005 1.195.299 1.519 - 40.191 37 1.237.046B. Increases 19.428 256 - 30.316 - 50.000B.1 Purchases 19.410 256 - 29.591 - 49.257B.2 Increases in intangible internal assets - - - - - - B.3 Value recoveries - - - - - - B.4 Positive changes in fair value - - - - - -

a) in shareholders’ equity - - - - - - b) in the income statement - - - - - -

B.5 Positive exchange rate differences - - - - - - B.6 Other changes 18 - - 725 - 743C. Decreases -5.105 -728 - -21.509 - -27.342C.1 Sales - - - - - - C.2 Net impairment losses - -728 - -20.506 - -21.234

- Amortisation - -728 - -20.506 - -21.234- Write downs - - - - - -

- shareholders’ equity - - - - - - - income statement - - - - - -

C.3 Negative changes in fair value - - - - - - - in shareholders’ equity - - - - - - - in income statement - - - - - -

C.4 Transfers to non current assets held for sale. - - - - - - C.5 Negative exchang rate differences - - - - - - C.6 Other changes -5.105 - - -1.003 - -6.108D. Final net holdings 1.209.622 1.047 - 48.998 37 1.259.704D.1 Total net impairment losses 296.214 2.056 - 47.391 - 345.661D.2 Final gross holdings 1.505.836 3.103 - 96.389 37 1.605.365

30.9.2006

Figures in thousands of euro

GoodwillIntangible assets:

internally generated Intangible assets: other

Goodwill The purchases indicated in item B.1 of Table 27 relate to acquisitions of shares from third parties described in the section “The consolidation area”. In detail these concerned the following companies (figures in thousands of euro):

- Centrobanca Spa 1.203 - BPU Centrosystem Spa 387 - IW Bank Spa 4.628 - BPA Spa 333 - Banca Carime Spa 3 - BY YOU Spa 12.856 Total 19.410 The other decreases (-5,1 million) are entirely attributable to the decrease in the goodwill of Banca Carime following the receipt of prior year dividends relating to the shares subject to the Deutsche Bank option.

55

Commitments to purchase intangible assets Commitments to purchase intangible assets at consolidated level amounted to 11.698 thousand euro and were attributable entirely to the Parent Bank, BPU Banca Scpa. They concern purchases of software and the development of computer programmes.

56

Non current assets/liabilities held for sale

Table No. 28

Figures in thousands of euro30.9.2006

31.12.2005pro-forma

30.9.2005pro-forma

A. Single assetsA.1 Equity investments - - A.2 Tangible assets - 298A.3 Intangible assets - - A.4 Other non current assets - -

Total A - 298 -

B. Groups of assets (discontinued operating units)B.1 Financial assets held for trading - - B.2 Financial assets at fair value - - B.3 Available-for-sale financial assets - - B.4 Held-to-maturity financial assets - - B.5 Loans to banks 9.620 B.6 Loans to customers 159.946 B.7 Equity investments - - B.8 Tangible assets 145 B.9 Intangible assets 1.949 B.10 Other assets 2.472

Total B - 174.132 60.220

C. Liabilities associated with single assets held for saleC.1 Borrowings - - C.2 Securities - - C.3 Other liabilities - -

Total C - - -

D. Liabilities associated with disposal groups held for saleD.1 Due to banks - - D.2 Due to customers 73.389D.3 Securities issued - - D.4 Financial liabilities held for trading - - D.5 Financial liabilities at fair value - - D.6 Provisions 342 D.7 Other liabilities 9.288

Total D - 83.019 38.305

Non current assets and disposal groups held for sale: composition by type of asset

There were no non current assets and disposal groups held for sale at 30th September 2006. The amounts existing at as at 31st December 2005 and 30th September 2005 related to the tax collection companies Bergamo Esattorie Spa and Ancona Tributi Spa, sold to Riscossione Spa with effect from 30th September 2006.

57

Provisions for liabilities and charges Provisions for liabilities and charges: composition Table No. 29

Figures in thousands of euro30.9.2006

31.12.2005pro-forma

30.9.2005 pro-forma

1. Company pension funds 156.645 163.138 165.3282. Other provisions for liabilities and charges 180.392 168.301 189.236

2.1 litigation 67.379 71.191 67.633

2.2 staff costs 13.553 304 -

2.3 other 99.460 96.806 121.603

Total 337.037 331.439 354.564

Table No. 30

Figures in thousands of euro30.9.2006

31.12.2005pro-forma

30.9.2005 pro-forma

1. Provision for revocation risks 54.319 51.002 53.2412. Provision for adjustments on interest, commissions andexpenses 8.831 9.174 5.890 3. Provision for bonds and default 16.412 17.842 17.872

4. Other provisions for liabilities and charges 19.898 18.788 44.600

Total 99.460 96.806 121.603

of which: Provisions for liabilities and charges -other provisions

Contingent liabilities The table that follows contains a summary of consolidated contingent liabilities for which there is no obligation to make provisions, but only to disclose information. The method followed is described in detail in the Notes to the Consolidated Accounts for the year ended 31st December 2005 (Section 12 on the balance sheet liabilities), which may be consulted.

Table No. 31

Figures in thousands of euro 30.9.2006 31.12.2005

Type of provisionProvision for staff litigation 205 284

Provision for revocation risks 495 1.155

Provision for bond in default risks 500 740

Provision for compounding of interest 200 127

Provision for claim risks 264 98

Provision for other litigation 7.081 1.470

TOTAL 8.745 3.874

The potential amount at 30th September 2006 of the future obligations which the Group might be called upon to meet has increased with respect to the situation at the end of 2005, mainly as a result of developments concerning litigation, of which 5,1 million relates to BPU Esaleasing.

58

The income statement The income statement figures commented on below are based on the following reclassified statements contained in the opening section of this report: the consolidated income statement, the quarterly income statement and the income statement net of non recurring components. In order to provide consistent and uniform information, the tables furnishing details to support the comments have been aligned with those reclassified accounts (see the relative notes on the method for a detailed description).

The statements relating to all the periods for 2005 have been restated on a pro-forma basis and they incorporate the changes already reported in the Half Year Report and summarised in the introductory notes to the section “Reclassified consolidated accounts and reconciliations”. Reconciliations between the mandatory schemes and the reclassified accounts are given for the statements to 30th September 2006 and to 30th September 2005, while the information reported in the Half Year Report to 30th June 2006 may be consulted for all the other periods.

The first nine months of the year generated a consolidated net profit of 509 million euro which included non recurring items totalling 135 million. Net profit for the Group in the same period of 2005 totalled approximately 594 million and benefited from non recurring components amounting to 264 million. Net of those items (all reported in the special statements mentioned above) the result for the period recorded an improvement of 13,6% to 374 million the result above all of growth in operating income and control over costs. Operating income as a whole increased by approximately 106 million (+5,4%) and represented a summary of rather differing performance by all the items that form part of ordinary activities. Net interest income (for which Table 32 gives the composition) rose to approximately 1,2 billion, with an increase of 5,1% compared to the first nine months of 2005. In reality the item includes very marked growth for some components (business with customers and financial activities), but also a negative contribution connected with liquidity management on the interbank market. The positive growth in the aggregate is primarily attributable to the good performance of the net balance between interest income on loans to customers and interest expense on amounts due to customers and on securities in issue, which represents the most significant component, recording an increase of 20%, amounting to 1.109 million. This was primarily the result of strong growth in volumes of business and in lending in particular (+10% increase in average volumes for the aggregate for network banks, BPU Banca and Centrobanca), while the spread on interest rates narrowed only slightly as a result of a reduction in the mark up of 36 basis points and an increase in the mark down of 34 basis points.

Operating figures for the network banks, and that is therefore for core business with customers, reveal that more than 81% of net interest income was generated on the retail market, 16% on the corporate market and approximately 3% on the private market. Financial activities also made a positive and growing contribution to net interest income of more than 214 million (+24% approximately compared to 2005); 152 million of this related to interest maturing on capitalisation certificates, recognised under “financial assets at fair value”, which, with a gross annualised yield of 3,8%, generated net income in the period of 44,1 million on average volumes of 5,3 billion (4,21% the gross yield in the first nine months of 2005, with net income of 69,7 million on average volumes of 4,5 billion). The balance between interest income on loans to banks and interest income on borrowings from banks, however, was negative by 100,7 million, in line with the role played by funding on the interbank market in financial management policies.

59

Interest income and similar: composition Table No. 32a

Performing financial assets

Debt securities

Financing

1. Financial assets held for trading 36.468 - - - 36.468 155.919 2. Financial assets at fair value 151.869 - - - 151.869 - 3. Available-for-sale financial assets 28.473 - - - 28.473 22.760 3. Held-to-maturity financial assets 27.416 - - - 27.416 11.176 5. Loans to banks 760 56.940 6 10.506 68.212 59.7686. Loans to customers 10.937 1.689.422 9.346 10.125 1.719.830 1.474.2337. Hedging derivatives - - - - - 24.562 8. Financial assets transferred not derecognised - - - - - - 9. Other assets - - - 2.079 2.079 2.832

Total 255.923 1.746.362 9.352 22.710 2.034.347 1.751.250

Interest expense and similar: composition Table No. 32b

Borrowings SecuritiesOther

liabilitiesJan.-Sept.

2006

Jan.-Sept. 2005

pro-forma

1. Due to banks -168.928 - - -168.928 -43.214 2. Due to customers -206.387 - - -206.387 -146.177 3. Securities in issue - -404.381 - -404.381 -403.140 4. Financial liabilities held for trading - - -29.736 -29.736 -16.577 5. Financial liabilities financial held at fair value - - - - -

- - - - - 7. Other liabilities - - -225 -225 -60 8. Hedging derivatives - - -24.699 -24.699 -

-375.315 -404.381 -54.660 -834.356 -609.168

Net interest income 1.199.991 1.142.082

Total

6. Financial liabilities for assets transferred not derecognised

Jan.-Sept. 2005

pro-formaItems / Type

Items / Type

Impaired financial assets

Other assets Jan.-Sept. 2006

Net commissions rose to approximately 610 million to record an increase of 5,3% compared to the same period of 2005. For the purposes of a uniform comparison, however, it must nevertheless be considered that: - the figure for the first nine months of 2005 did not yet include the impact of the application

of amortised cost (estimated at -8,9 million to 30th September 2005), which was introduced in the annual accounts as at 31st December 2005;

- the figure for the first nine months of 2006 includes -4,7 million relating to consolidation adjustments not correctly performed when consolidating the accounts for the year ended 31st December 2005 and to 30th June 2006. This was charged directly to the income statement to 30th September 2006 with a very limited effect on the net result.

If both the elements cited are considered (reported in the income statement net of non recurring items) then net commissions increased by nearly 8%. As shown in tables 33a and 33b, the improvement is attributable to a large extent to the “securities” area, which further increased as a percentage of total net commission income from 52% to 55% with a net contribution of approximately 339 million13, an increase of 11,7% compared to 2005. There was particular growth in net commissions on assets under management for both collective and individual instruments, (+29%) amounting to 206,6 million (accounting for 61% of total commissions in the “securities” area), while the distribution of third part insurance products (Aviva Vita) generated a little more than 20 million (down compared to 28,1 million in 2005) as a result of a commercial policy which aims at increasing new policies in the next few months by taking action on costs.

13 The amount consists of management, trading and advisory services net of the corresponding expense items and is

calculated excluding currency trading.

60

Operating figures show growth in total commissions received for the asset management company alone of 26%. As a result, amongst other things, of developments on financial markets in the last quarter, BPU Pramerica performance commissions rose from 17,3 to 22,8 million (of which 15,4 million earned in the first quarter, 4,7 million in the second and 2,7 in the third quarter). As concerns the network banks only, current accounts also performed well, (+9% to 133 million) attributable mainly to the performance of bundled accounts (Duetto and Utilio accounts increased to 338 thousand and to more than 69 thousand respectively). Operating figures for the network banks show that 77% of net commission income was generated on the retail market, 10,5% on the corporate market and 12,5% on the private market. The net profit on trading, hedging and sale and repurchase activity rose from 118 million to approximately 155 million. The following contributed to this performance: - on the one hand, the positive effect of the progressive rationalisation of the equity portfolio

with 77,4 million of profits on the disposal of available-for-sale financial assets (item 100 b), of which 70,1 million from the sale of the remaining interest held in Banca Italease, 3,4 million from the partial disposal of CIM Italia Spa, 2,7 million from the disposal of SI Holding and 1,9 million from the partial disposal of Meliorbanca (against which there was the loss on the disposal of Esatri Spa of more than 700 thousand euro). The contribution in the first nine months of 2005 from the rationalisation of equity investments, was 9,7 million, relating to the sale of the first tranche of Banca Italease;

- on the other hand, the positive effect of credit risk management policies, with 38,5 million of profits on the disposal of loans (item 100 a)) generated with the operations for the sale of non performing loans without recourse (see the sub section on lending). Profits on the sale of loans in 2005 amounted to 36,9 million, in relation primarily to the disposal of two tranches of non performing loans concluded by Centrobanca.

The non recurring components indicated above (115,9 million) compensated for the decrease in trading activity, which fell in the period from 56 to 31,1 million. This performance on the other hand seems attributable to the weak performance of financial markets above all in the second quarter, although it was partially offset by market recoveries in the following months, as shown also by a combined reading of the net results for debt securities and equities and the relative derivatives contracts (+17,4 million at the end of September 2006, against a loss of 0,8 million at the end of June 2006).

Commission income: composition Table No. 33a

Figures in tho us ands o f euro

Jan.-Sept. 2006

Jan.-Sept. 2005

pro-forma

a) guarantees granted 18.263 17.995b) credit derivatives 1.042 733c) management, trading and advisory services 378.981 342.161

1. trading in financial instruments 27.758 25.3782. foreign exchange trading 7.923 8.4133. portfolio management 206.646 160.902

3.1. individual 46.948 40.2263.2. collective 159.698 120.676

4. cus to dy and adminis tra tio n o f s ecurities 9.598 10.9385. depository bank 16.653 15.3906. placement of securities 30.692 28.6217. stock market orders 25.700 26.6738. advisory activities 3.640 1.9959. distribution of third party services 50.371 63.851

9.1. portfolio managements 61 709.1.1. individual 61 709.1.2. collective - -

9.2. insurance products 20.102 28.1289.3. other products 30.208 35.653

d) collection and payment services 90.532 91.075e) s e rvicer ac tivities fo r s ecuritis a tio n o pera tio ns - 178 f) services for factoring operations - - g) tax collection and payment services - - h) other services 223.611 223.764

Total 712.429 675.906

Commission expense: composition Table No. 33b

Figure s in tho us ands o f euro

Jan.-Sept. 2006

Jan.-Sept. 2005 pro-

forma

a) guarantees received -165 -809 b) credit derivatives -3.098 -2.725 c) management and trading services: -32.634 -30.773

1. trading in financial instruments -8.625 -7.885 2. foreign exchange trading -162 -246 3. portfolio management - -619

3.1. own portfolio - -619 3.2. portfolio of others - -

4. custody and administration of securities -6.170 -5.993 5. placement of securities -2.294 -3.232 6. securities, products and services offered through indirect network -15.383 -12.798

d) collection and payment services -30.174 -31.892 - expenses related to the interbank payment system -9.300 -7.062 - other services -20.874 -24.830 e) other services -36.573 -30.389

Total -102.644 -96.588

Net commission income 609.785 579.318

61

Net profit (loss) from trading Table No. 34a

Net result Jan.-Sept. 2006

[(A+B)-(C+D)]

1. Financial assets held for trading 43.988 61.905 -29.044 -39.840 37.009 48.4141.1 Debt securities 2.305 6.766 -15.173 -10.080 -16.182 8.4861.2 Equities 26.721 45.415 -5.884 -18.443 47.809 36.115

1.3 Units in O.I.C.R. (collective investment instruments) 10.022 3.034 -1.166 -5.375 6.515 2101.4 Financing - - - - - - 1.5 Other 4.940 6.690 -6.821 -5.942 -1.133 3.603

2. Financial liabilities held for trading - - - - - -602 2.1 Debt securities - - - - - - 2.2 Debts - - - - - - 2.3 Other - - - - - -602

3. Other financial liabilities: Exchange rate differences 48.651 - -48.615 - 36 3424. Derivative instruments 503.137 692.972 -503.019 -698.993 -5.903 7.895

4.1 Financial derivatives 502.924 692.699 -502.532 -698.993 -5.902 7.924- on debt securities and interest rates 293.513 614.371 -290.837 -601.750 15.297 15.589- on equities and share indexes 28.133 78.288 -38.722 -97.206 -29.507 -4.642 - on currencies and gold 167.594 - -156.579 - 11.015 -3.483 - other 13.684 40 -16.394 -37 -2.707 460

4.2 Credit derivatives 213 273 -487 - -1 -29

Total 595.776 754.877 -580.678 -738.833 31.142 56.049

Net profit (loss) from hedging Table No. 34b

Items / Components of incomeJan.-Sept. 2006

Jan.-Sept. 2005

pro-forma

A. Relative income 171.647 166.569B. Relative expense -167.521 -164.139

C. Net profit (loss) on hedging (A-B) 4.126 2.430

Profits (losses) from disposal/repurchase Table No. 34c

Financial assets1. Loans to banks - -30 -30 - 2. Loans to customers 49.190 -10.682 38.508 36.8693. Available-for-sale financial assets 83.860 -4.493 79.367 23.142

3.1 Debt securities (*) 3.265 -2.099 1.166 15.4403.2 Equities 79.853 -2.372 77.481 7.6563.3 Units in O.I.C.R (collective investment instruments) 742 -22 720 463.4 Financing - - - -

4. Held-to-maturity financial assets - - - -

Total assets 133.050 -15.205 117.845 60.011Financial liabilities1. Due to banks - - - - 2. Due to customers - - - - 3. Securities in issue 1.815 -361 1.454 -614

Total liabilities 1.815 -361 1.454 -614 Total 134.865 -15.566 119.299 59.397

Net profit (loss) from trading, hedging and disposal/repurchase activities 154.567 117.876

(*) The figure for the first quarter of 2005 includes 12,6 million from securities trading and the relative hedging derivatives contracts already included originally in the fixed asset portfolio.

Transactions / Components of income

Items / Components of incomeProfits Losses

Losses (C)Gains (A)Profit from trading (B)

Losses from trading (D)

Net result Jan.-Sept. 2006

Jan.-Sept. 2005

pro-forma

Jan.-Sept. 2005

pro-forma

Net income on insurance operations (which includes net interest, net premiums, profit on trading activity and the balance on other income/expenses from insurance operations and various, relating to BPU Assicurazioni and BPU Assicurazioni Vita) amounted to 45,4 million compared to 49,4 in million in the comparison period.

62

Other operating income/expenses, calculated net of tax recoveries (reclassified under other administrative expenses) and of depreciation charges relating to expenses incurred for improvements to leased assets (reclassified under depreciation), amounted to 43 million, compared to 60 million in 2005. The latter sum nevertheless included net income of 22 million from the settlement with Banca Intesa (in relation to guarantees granted when Banca Carime was sold) and from the settlement of the litigation with IBM (which arose following the black out of 28th September 2003). Operating costs, which consist of staff costs, other administrative expenses and net impairment losses on tangible and intangible assets, totalled 1.143 million, generally in line with the first nine months of 2005. In detail, staff costs remained more or less unchanged at 754,4 million. As is shown in the table the performance of the item is in reality the result of different trends: +3,7 million increase in employee costs, +0,3 million for the directors component and -4,6 million the reduction attributable to other personnel and to temporary staff in particular (see the section “The human resources of the Group”).

As already stated in the Half Year Report, staff costs include provisions, which the Group made for employment contract renewals and also 4,7 million of additional expenses relating to variable components of wages in 2005, recorded in the accounts after the end of the year. It must also be considered that as shown in the income statement net of non recurring items, the figure for 2005 was negatively affected by a one-off item amounting to 20 million euro for the update of the estimate of redundancy costs at Banca Carime, which could no longer be capitalised under IAS. Net of that item staff costs would have changed, however, by a modest 1,4%.

Other operating income and costs Table No. 35

Figures in tho us ands o f euro

Jan.-Sept. 2006

Jan.-S e pt. 2005

pro-forma

Other operating income 54.283 75.014 Charges to third parties for expenses on deposit and current accounts

10.777 12.212

Recoveries of other expenses 10.605 5.434Recovery of insurance premiums 11.801 9.887Recoveries of taxes 77.907 72.698

Rents and other income for property 7.524 8.897Other income and exceptional receivables 13.213 38.065Consolidation adjustments 363 519Reclassification of "tax recoveries" -77.907 -72.698

Other operating expenses -11.080 -14.873 Fines and charges for late tax payments -108 -98 Shortages relating to the management of valuables -284 -224 Depreciation of improvements to leased assets -6.791 -7.930

Ordinary maintenance of investment properties -4 -81

Other costs and exceptional payables -10.684 -14.470 Consolidation adjustments - -

Reclassification of depreciation of improvements to leased assets 6.791 7.930

Other operating income and costs 43.203 60.141

Staff costs: composition Table No. 36

Figures in tho us ands o f euro

Jan.-Sept. 2006

Jan.-Sept. 2005

pro-forma

1) Permanent employees -733.218 -729.558 a) Wages and salaries -512.426 -501.688 b) Social security charges -138.210 -136.948 c) Severance indemnity -825 -800 d) Pension expense -2.893 -282 e) Provision charge for severance payments

-34.695 -30.915 f) Provision charge for pension and similar:

-537 -6.085 - defined contribution -493 -433 - defined service -44 -5.652

g) Payments to outside complementary retirement benefit plans: -16.172 -12.446

- defined contribution -15.921 -12.214 - defined service -251 -232

h) Expenses resulting from share based payment agreements -458 -458 i) Other benefits for permanent employees -27.002 -39.936

2) Other personnel -14.124 -18.687 - Expenses for temporary agency staff -11.895 -15.594 - Other expenses -2.229 -3.093

3) Directors -7.070 -6.769 Total -754.412 -755.014

63

As a result of action in progress to contain costs, other administrative expenses, details of which are given in Table 37, totalled 300 million, a further reduction of 7,3 million compared to the first nine months of 2005 (-2,4%). Net impairment losses on tangible and intangible assets increased to 88,5 million, in relation to investments in technology performed in accordance with the Industrial Plan. More than 50% of the amount is attributable to the Parent Bank (of which 14,8 million for amortisation of IT procedures). As a result of the performance reported above, the cost/income ratio, calculated as the ratio of costs to operating income, was 55,2% (58,1% in September 2005). Net of non recurring components (disposals of equity investments and loans, variable components of wages, the BPU Pramerica earn-out and the disposal of the tax collection companies), the cost/income ratio was 58,1%, which confirms the downward trend compared to 59,8% in September 2005. As a summary of the trends described, net operating income rose to 926 million euro an improvement of 12,6%. Net impairment losses on loans fell to 116 million, a reduction of 15,3 million. As a percentage of net lending to customers, the item accounts for 0,31% of it annualised (0,39% annualised in the first nine months of 2005 and 0,47% for all of 2005). After the disposal of non performing loans, the positive effect of discounting problem loans to present values reduced to 15,7 million (28,4 million in the same period of 2005).

Table No. 38

Figures in thousands of euro Cancellations Other of interestother

recoveriesof interest

other recoveries

A. Loans to banks - -2 -105 - 37 - 300 230 -

B. Loans to customers -28.619 -181.277 -42.827 15.703 73.292 290 46.974 -116.464 -131.520

C. Total -28.619 -181.279 -42.932 15.703 73.329 290 47.274 -116.234 -131.520

Gen-Set2005

pro-forma

Net impairment losses

SpecificPortfolio

Specific

Value recoveries

Portfolio Jan.-Sept. 2006

Net impairment losses on loans: composition

As a result of reclassification under specific items (see the methodological note to the reclassified consolidated income statement in the section “Reclassified consolidated accounts and reconciliations”), net provisions for liabilities and charges amounted to 3 million. Finally the income statement benefited from profits on the disposal of equity investments amounting to 52,7 million, of which 46,5 million related to the earn-out for the period paid by Prudential International Investments Corporation for its interest in BPU Pramerica and 5,8 million related to the disposal of the tax collection companies. This item amounted to approximately 227 million in 2005 and included profits on the following sales: Carifano (107,1 million), a minority interest in BPCI to Aviva Spa (56,8 million), Immobiliare Serico (38,6 million), Arca Merchant (4,6 million) and ABF Leasing (2,4 million), as well as the earn-out relating to BPU Pramerica (16,5 million). Given the income items reported above and the lower cost of risk, the decrease in profit on continuing operations before tax (-6,5% to 860 million) is explained by the smaller

Other administrative expenses: compositionTable No. 37

Type o f s ervice /Va lues F igures in tho us ands o f euro

Jan.-Sept. 2006

Jan.-Sept. 2005

pro-forma

A. Other administrative expenses -291.663 -298.906 Postal, telephone and telegraph charges -31.551 Use of networks and ICT services -28.340 Professional services -56.556

Maintenance, ins tallation of machines , furnishings etc. -17.157

Tenancy of premises -20.718 Insurance premiums -4.633 Counting and management of valuables -9.946 Cleaning -7.906 Advertising -14.758 Forms and stationery -6.697 Information services and land registry searches

-7.346

Property maintenance -5.550 Security -5.949 Travel expenses -3.010 Agency expenses -2.212 Electronic processing by third parties -8.935 Maintenance of equipment -3.671 Emoluments of statutory auditors -1.286 Membership fees -3.470 Transport and removals -1.753 Sundry goods -708 Books and periodicals -1.176

Maintenance of rented premises and equipment -5.006

Rent of premises -33.695 Lease ins talments on machines , software, furnishings , etc.

-2.180

Other contributions -1.095 Other -6.359 B. Indirect taxes -8.340 -8.442 Indirect taxes and duties -1.988 Stamp duty -65.729 Municipal property tax -3.132 Other taxes -15.398 Reclassification of "tax recoveries" 77.907Total -300.003 -307.348

64

contribution from non recurring items compared to 2005. Net of those non recurring items profit did in fact improve by 12%. The income statement also recorded tax of 318 million, to give a tax rate of 36,9%. In the first nine months of 2005 the tax levied amounted to approximately 298 million, with a tax rate of 32,4%. This indicator benefited in both periods from special tax treatment for some capital gains on the disposal of equity investments. ROE (return on equity), calculated as the ratio of profit for the period attributable to the Parent Bank to shareholders’ equity excluding profit, was 15,5%, compared to 20,1% in the first nine months of 2005 (annualised data). Net of non recurring components, ROE was 11,4% (11,1% for the first nine months of 2005, annualised).

* * *

Finally with regard to quarterly trends, the Group earned net profit in the period July-September 2006 of 128,7 million (inclusive of non recurring items of 13 million), compared to 150,5 million in the second quarter of 2006 (which had benefited from non recurring components amounting to 34,8 million). If non recurring components are excluded, on the income side the result summarises an improvement in net interest income and a positive contribution to profits from trading activities, which offset the lower contribution from the other components. On the costs side, which were at their lowest level for 2006, there was a significant reduction attributable primarily to staff costs.

65

Shareholders’ equity and capital adequacy It can be seen from the statement of changes in consolidated shareholders’ equity at 30th September 2006 that there was an increase in the consolidated shareholders’ equity of the Group (inclusive of profit for the first nine months of the year) from 4.709 million euro at the end of 2005 to 4.893 million. Furthermore that statement contains a charge of 402.628.770,74 euro to the “issue premiums” reserve, authorised by a General Meeting of the Shareholders of BPU Banca of 22nd April 2006, in relation to the attribution of the residual “first time adoption” negative reserve of the same amount. Growth in shareholders’ equity in the nine month period is attributable to: • changes in the opening balances as at 1st January 2006 of net reserves amounting to 22,4

million, following what is termed “fiscal realignment” (see the subsequent sub section “The property revaluation”);

• the allocation of 2005 profit to dividends and other uses amounting to 288,8 million; • the recognition of the profit for the period of 509,1 million; • the net negative change in reserves of 63,1 million, mainly attributable to the decrease,

against the income statement, in the valuation reserves for available-for-sale financial assets, for which details of changes are given in Table 39. More specifically, the negative change of 73,5 million shown concerning equity investments relates to the disposals already mentioned, including that of the interest held in Banca Italease Spa14;

• the issue of new shares by the Parent Bank (with a positive impact on equity of 4 million) performed in relation to the stock option plan (see the relative section).

Table No. 39

Figures in thousands of euro

Debt securities Equities

Units of O.I.C.R. (collective investment instruments)

Financing Total

1. Initial holdings al 1st January 2006 27.849 86.568 -4.432 - 109.9852. Positive changes 995 36.256 253 - 37.504

2.1 Increases in fair value 691 34.199 133 - 35.0232.2 Transfer to income statement of negative reserves 236 1.980 - - 2.216

- for impairment - - - - - - from disposal 236 1.980 - 2.216

2.3 Other changes 68 77 120 - 2653. Negative changes -21.152 -73.500 -3.052 - -97.704

3.1 Decrease in fair value -8.109 -3.441 -2.621 - -14.171 3.2 Impairment losses - - - - -

3.3 Transfer to income statement of positive reserves for disposals -11.930 -70.053 -431 - -82.414 3.3 Other changes -1.113 -6 - -1.119

4. Final holdings 7.692 49.324 -7.231 - 49.785

Valuation reserves for available-for-sale financial assets: changes in the period

14 As concerns changes in the reserves, in addition to the already cited deduction of 402 million from the issue

premiums reserve, there was also a reduction of 48 million to the reserve for special revaluation laws (as the effect of free of charge increases in share capital performed by some banks in the Group) both with balancing entries in the consolidation reserves.

66

Table No. 40

Figures in thousands of euroPositive reserve

Negative reserve

1. Debt securities 15.075 -7.383 2. Equities 50.051 -727 3. Units in O.I.C.R. (collective investment 571 -7.802 4. Financing - - Total 65.697 -15.912

Valuation reserves for available-for-sale financial assets: composition

30.9.2006

Table No. 41

Figures in thousands of euroShareholders’ equity of which: Profit

for the period

Shareholders’ equity and profit for the period in the accounts of the Parent bank 4.192.648 526.671

Effect of consolidation of subsidiaries including joint ventures 906.612 519.030

Effect of valuing other significant equity investments using the equity method 15.771 5.968

Dividends received during the period - -532.199

Other consolidation reclassifications and adjustments -221.926 -10.393

Shareholders’ equity and profit for the period in the consolidated accounts 4.893.105 509.077

Reconciliation between shareholders' equity and profit of the Parent Bank with consolidated shareholders' equity and net profit at 30th September 2006

The property revaluation The following information was furnished in the 2005 Consolidated Annual Report (page 102): a) Law No. 266 of 23rd December 2005 (the Finance Law for 2006) reopened the terms for the

revaluation, with effect for both the financial statements and for fiscal purposes, of property assets recognised in the 2004 annual accounts and still present at the end of 2005 by means of the payment of a substitute tax (12% for depreciable assets and 6% for non depreciable assets) by 20th June 2006. The revaluation does not involve immediate recognition for tax purposes of the greater values attributed, which will not take effect for the purposes of IRES (corporation tax) and IRAP (local production tax) until the third year following that in which the revaluation was performed (2005), which is to say in the tax year 2008.

b) therefore the depreciation performed in 2005, 2006 and 2007 is not tax deductible. The tax recovery of the greater depreciation instalments for financial reporting with respect to those admissible for tax purposes cannot occur until the end of the period of depreciation of the assets;

c) the positive revaluation balance generated must be recognised in a special reserve which is to say in equity and, normally, remain suspended from taxation with the relative financial reporting and tax constraints if distributed;

d) considering also that no specific indications have been given by the relative authorities for companies that started to apply IAS/IFRS international accounting standards in 2005, most Group member companies decided to proceed to the revaluation of their property assets;

e) since the substitute tax of the cited 2006 National Finance Law is less than the deferred tax liabilities recognised in compliance with IAS/IFRS international accounting standards in order to apply the deemed cost (adoption of fair value to replace cost on first time adoption of IAS/IFRS), the excess part of that deferred liability has been recognised under equity.

67

Given the above, on 13th June 2006 the tax authorities issued Circular No. 18/E according to which only entities that applied IAS/IFRS could make use of the “fiscal alignment” regulations, intended as meaning the adjustment of “values for tax purposes in line with the value of a company’s assets recognised in its accounts”. As indicated in that circular, “what may be specifically aligned are those values recognised in accounts for financial reports which are higher than those recognised for tax purposes in the annual accounts as at 31st December 2004 in relation to those assets subject to revaluation”. One of the elements which distinguishes realignment from revaluation is the obligation to “fill the entire gap between the cost for tax purposes and for ordinary financial reporting purposes of assets, since partial realignment only of the differences in value is not possible”. In the light of the above the application of “fiscal realignment” in place of revaluation resulted in limited positive adjustments to the asset items concerned. More specifically the fully consolidated banks and companies affected by this realignment recorded a reduction in the item reserves for valuation - special revaluation laws amounting to 10,8 million euro, and an increase in other reserves amounting to 34,1 million. Net of reserves attributable to minorities, calculated on the basis of the percentage of ownership at 30th September 2006, the BPU Group increased its net reserves by 22,4 million, the result of an increase in other reserves of 33 million and a decrease in reserves for valuation – special revaluation laws of 10,6 million. Capital adequacy Capital ratios

Table No. 42

Figures in thousands of euro30.9.2006 estimate 30.06.2006 31.12.2005

Core capital "core" (net of preference shares) 3.441.406 3.366.675 3.246.467 Preference shares 415.000 415.000 438.823

Core capital 3.856.406 3.781.675 3.685.290 Supplementary capital 1.819.313 1.823.172 1.886.118

Components to be deducted -255.875 -233.407 -254.446

Supervisory capital 5.419.844 5.371.440 5.316.962 Credit risk 4.349.582 4.278.891 3.776.344

Market risk 152.346 126.204 348.518

Other prudential requirements 37.624 37.796 39.306

Total prudential requirements 4.539.551 4.442.891 4.164.168 Subordinated liabilities Tier III

Nominal amount 250.000 250.000 50.000

Amount calculated 152.346 126.204 49.875

Risk weighted assets 56.744.392 55.536.138 52.052.100 Core Tier 1 (core capital net of preference shares/Risk weighted assets) 6,06% 6,06% 6,24%Tier 1 (Core capital/Risk weigthed assets) 6,80% 6,81% 7,08%Total capital ratio [(Core capital+Tier 3)/Risk weighted assets] 9,82% 9,90% 10,31% The capital ratios estimated at 30th September 2006 were virtually unchanged compared to the end of June. The slight reduction in the total capital ratio was more than compensated for by the issue in October of a subordinated lower tier 2 bond for 300 million, which when included in the calculation would bring the ratio back above 10%. The increase in risk weighted assets following the growth in lending to customers, only partially attenuated by the decrease in loans to banks and the surrender of some capitalisation policies, was compensated for by the 74 million increase in the core capital, primarily attributable to positive elements, including profit for the period to be retained amounting to 45 million and the gross impact of “fiscal realignment” amounting to 33 million. The negative effect on supplementary capital of the related decrease by 10,6 million in reserves for valuation – special revaluation laws was partly counterbalanced by an increase in positive filters following the recognition of implicit gains by available-for-sale securities.

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The Stock Option Plan Since 1st July 2003, the date of the merger between the two original banking groups, BPU Banca has taken the position of the former Banca Popolare Commercio e Industria Scrl with regard to the beneficiaries of the options granted, as already reported in detail in the last annual report which may be consulted. Stock option rights granted Table No. 43

Number of options Average prices Average expiry

date

A. Initial situation al 31.12.2005 (20 senior manager beneficiaries) 436.213 9,43 31.12.2006B. Increases - - -

B.1 New issues - - -

B.2 Other changes - - - C. Decreases - - - C.1 Cancelled 3.093 9,43 31.12.2006

C.2 Esercised 404.246 9,43 31.12.2006

C.3 Expired - - - C.4 Other changes - - - D. Final holdings at 30.9.2006 (3 senior manager beneficiaries) 28.874 9,43 31.12.2006Options exercised in October 2006 (senior manager beneficiaries) 12.374 9,43 31.12.2006E. Options exercisable at year end (1 senior manager beneficiary) 16.500 9,43 31.12.2006

January - September 2006

Table 43 shows that the following occurred in the first nine months of the year: the exercise by 16 senior manager beneficiaries of a total of 404.246 options, with the issue

of the same number of ordinary shares with dividend entitlement from 1st January 2006; the cancellation, ratified by the Board of Directors on 12th May 2006, of 3.093 option rights

belonging to a senior manager beneficiary who resigned in 2005 (as laid down in the “General Conditions of the stock option plan” which require the cancellation of options no more exercisable).

Subsequent to 30th September 2006 further option rights were exercised by two senior managers which led to the issue of a total of 12.374 ordinary shares with dividend entitlement from 1st January 2006. Therefore at the date of this report, the number of rights still exercisable before the end of the year amounts to 16.500, which would give rise to an increase in the share capital of BPU Banca of 583 thousand euro.

* * * As concerns the other group member companies it should be recalled that: as already fully illustrated in the Consolidated Half Year Report to 30th June 2006, which

may be consulted, an Extraordinary General Meeting of IW Bank approved a resolution authorising the Board of Directors to increase the share capital for a period of five years from the date of approval, in accordance with Art. 2443 of the Italian Civil Code, for a maximum amount of 1.514.070 euro, through the issue of a maximum of 302.814 shares with a nominal value of 5 euro each, to be offered for subscription at the price of 5,29 euro, in compliance with Art. 2441 of the Italian Civil Code, to the beneficiaries (key figures in the bank) of the “IW Bank Stock Option Plan”, which expires on 30th June 2008;

Mercato Impresa Spa has a stock option plan in existence approved by an Ordinary General Meeting in October 2000 for some employees. The options had all been exercised by those to whom they were granted by the expiry date (55.802 options for subscription, at the unit price of 0,51 euro, of the same number of shares by the 12 beneficiaries).

69

Table 44 provides information on the number of shares of the Parent Bank with the changes that occurred in the first nine months of 2006 and the fully diluted share capital. As can be seen, compared to 31st December 2005, the outstanding shares, all with regular dividend entitlement, increased by 404.246 as a result of the exercise of stock options, details of which are given above.

Table No. 44

Ordinary shares Nominal value 2,50 euro

A. Shares existing as at 31st December 2005 344.049.564 860.123.910,00 - fully paid up 344.049.564 860.123.910,00 - not fully paid up - -

A.1 Own shares (-) - -

A.2 Outstanding shares: initial number 344.049.564 860.123.910,00 B. Increases 404.246 1.010.615,00 B.1 New issues 404.246 1.010.615,00

- by payment: 404.246 1.010.615,00 - company merger operations - - - conversion of bonds - - - exercise of warrants - - - other 404.246 1.010.615,00 - free of charge: - - - in favour of employees - - - in favour of directors - - - other - -

B.2 Sale of own shares - - B.3 Other changes - - C. Decreases - - C.1 Cancellation - - C.2 Purchase of own shares - - C.3 Company disposal operations - - C.4 Other changes - -

D. Outstanding shares: final holdings at 30th September 2006 344.453.810 861.134.525,00 D.1 Own shares (+) - - D.2 Outstanding shares at the end of period 344.453.810 861.134.525,00

- fully paid up 344.453.810 861.134.525,00 - not fully paid up - -

Shares issued in October 2006 (stock options) 12.374 30.935,00

Share capital at the date of this report 344.466.184 861.165.460,00 No. shares to be issued:

- stock options (expiring 31st December 2006) 16.500 41.250,00 Fully diluted share capital 344.482.684 861.206.710,00

Number of Parent Bank shares: changes in the period

Own shares At 30th September 2006 as at 31st December 2005 BPU, Banca held none of its own shares, having neither purchased nor sold shares under the specific mandate received each year from shareholders.

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Information concerning share capital the shares, dividends paid and earnings per share Information concerning share capital As at 30th September 2006, BPU Banca possessed share capital amounting to 861.134.525 euro consisting of 344.453.810 ordinary shares with a nominal value of 2,5 euro. See the preceding section, “shareholders’ equity and capital adequacy”, for details of changes in the share capital that occurred in the first nine months of 2006.

* * * In compliance with the relative legislation (Art. 30 of the Consolidated Banking Act), which is also cited in Article 18 of the Corporate Statute of the Bank, no one may hold more than 0.50% of the share capital in a ‘popular’ bank and each registered shareholder may cast only one vote, irrespective of the number of shares held. That limit on the size of shareholdings does not apply to collective investment companies which are subject to the limits laid down in the rules of each of them. Under Article 120 of the Testo Unico della Finanza (Consolidated law on financial intermediation), persons holding more than 2% of the share capital of a company with listed shares must notify this to the company and to the Consob. During the course of the third quarter a report was made that the 2% threshold had been exceeded by Fidelity International Limited, a major independent asset management company in the world, which had reached 2,006% of the share capital of BPU Banca. Subsequent to the end of the quarter and until the date of approving this quarterly Report, BPU Banca had received no further reports of that threshold being exceeded. On the basis of the updating of the shareholders’ register, at the date of publishing this report the Bank had 60.122. 42649 registered shareholders. The number of shareholders not listed in the shareholders’ register on the date of the dividend payment was 72.375, to give a total of 132.497 registered and unregistered shareholders. To complete the information on the share capital, on the basis of a market research study performed in April 2006 by the company Capital Bridge, a leader in the “market intelligence” sector, approximately 31,2% of BPU Banca shares were held by institutional investors. This percentage would be around 35% if an estimate is also made of the shares held by hedge funds and some depository banks not included in the survey. Share performance The shares in Banche Popolari Unite are traded on the Mercato Telematico Azionario (screen based stock market) of Borsa Italiana in the blue chip segment and form part of the S&P/MIB Index; the share recorded growth in the first nine months of the year of 14% compared to

Values in euro 29.9.2006 30.12.2005 % change

Banche Popolari Unite- official price 21,170 18,570 + 14,0%- reference price 21,220 18,520 + 14,6%

S&P/Mib 38.475 35.704 + 7,8%Mib Banks 3.801 3.230 + 17,7%

Comparative performance of the Banche Popolari Unite share Table No. 45

71

the price at 31st December 2005. The index for the banking sector improved by 17,7% in the same period, while the S&P/MIB index rose by 7,8%. If, however, the share performance is considered from 1st July 2003, the date on which BPU Banca was formed, the performance of the share (1st July 2003 – 30th September 2006) was +63,3% (graph 2). As can be seen from Graph 1, in the first nine months of 2006 and until the date of publishing this report the market price of the share recorded new record highs exceeding 22 euro (22,68 euro on 16th October).

Performance of the BPU Banca share since 1st July 2003 (*)

12,00

13,00

14,00

15,00

16,00

17,00

18,00

19,00

20,00

21,00

22,00

23,00

l a s o n d g f m a m g l a s o n d g f m a m g l a s o n d g f m a m g l a s o n(*) prezzi di riferimento

Graph No..1

2003 2004 2005 2006

In the period January-September, a total of 336 million shares were traded on the screen based stock market for a value of approximately 6,8 billion euro (357 million shares traded in 2005 as a whole for a value of almost 6 billion euro). The increase in the share price and the greater number of outstanding shares brought the stock market capitalisation (calculated on the official price) at the end of the third quarter to

Performance of the S&P/Mib, of the banking Mib and of the BPU Banca share (*) since 1st July 2003

90

100

110

120

130

140

150

160

170

180

190

200

l a s o n d g f m a m g l a s o n d g f m a m g l a s o n d g f m a m g l a s o n(*) prezzi di riferimento

S&P MibMib BancheBPU Banca

Graph No.2

2003 2004 2005 2006

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7.292 million euro compared to 6.389 million at the end of 2005 (approximately 4 billion at 1st July 2003). At the date of this report it exceeded 7,3 billion euro. The principal information on the BPU Banca shares is given below. BPU Banca share and the main stock market indices

Table No. 46

January-September

20062005

Number of shares outstanding at the end of period 344.453.810 344.049.564

of which: normal dividend entitlement 344.453.810 344.049.564Average BPU share price (average of official daily prices quoted by Borsa Italiana Spa - in euro) 20,452 16,757

Minimum price (in euro) 18,490 14,770

Maximum price (in euro) 22,240 19,190

Dividend per share distributed (in euro) 0,75 0,67

Dividend per share/average price (dividend yield) 3,67% 4,00%

Total dividends (in euro) 258.037.173 225.917.091

Total dividends /consolidated profit for the year 2005/2004 consolidated (Pay-out ratio) 37,9% 67,1%

Consolidated shareholders’ equity (excluding profit for the period) per share (in euro) 12,73 11,71

Stock market capitalisation at end of period (official prices) (in millions of euro) 7.292 6.389

Price/book value (Stock market capitalisation at end of period/consolidated net assets) 1,66 1,59

Dividends paid As concerns profits distributed to shareholders, a dividend was paid on 22nd May 2006, with value date 25th May, relating to the 2005 financial year amounting to a total of 258.037.137 euro. The 344.049.564 ordinary shares with dividend entitlement from 1st January 2005 earned a dividend of 0,75 euro per share. The dividend for the financial year 2004 was paid on 23rd May 2005, with value date 26th May, for a total amount of 225.917.091 euro. The dividend per share distributed on ordinary shares with dividend entitlement from 1st January 2004 amounted to 0,67 euro. Earnings per share The international accounting standard, IAS 33, specifies a precise method for calculating earning per share (EPS) with two formulas: basic earnings and diluted earnings per share. Basic EPS is calculated by dividing the profit attributable to holders of ordinary shares by the weighted average number of ordinary outstanding shares during the first nine months of 2006. Diluted EPS is calculated by adjusting the weighted average number of outstanding shares to take account of dilutive effects resulting from the issue of shares if all the potential stock options in the existing stock option plan are exercised.

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Table No. 47a

January-September 2006 Annualised attributable profit

(in thousands of euro)

Weighted average of ordinary shares

Earnings per share annualised

(in euro) Basic EPS 645.589 344.176.904 1,8757 Diluted EPS 645.589 344.192.464 1,8757

Table No. 47b

2005 Profit attributable (thousands of euro)

Weighted average of ordinary shares

Earnings per share (in euro)

Basic EPS 662.368 343.388.827 1,9289 Diluted EPS 662.368 343.579.562 1,9278

Table No. 47c

January-September 2005 Annualised attributable profit

(in thousands of euro)

Weighted average of ordinary shares

Earnings per share annualised

(in euro) Basic EPS 757.273 343.181.649 2,2066 Diluted EPS 757.273 343.439.625 2,2050

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Data on the main companies in the BPU Banca Group

Figures in thousands of euro Jan-Sept 2006 Jan-Sept 2005 % change

BPU BANCA 526.671 408.424 29,0%

BPB Spa 198.112 156.647 26,5%

BPCI Spa 70.404 52.948 33,0%

Banca Carime Spa 48.453 35.266 37,4%

Banca Popolare di Ancona Spa 73.758 140.100 -47,4%

Banca Popolare di Todi Spa 3.100 2.901 6,9% Centrobanca Spa (1) 70.504 67.904 3,8%

Banque de Dépôts et de Gestion Sa 5.024 5.116 -1,8%

B@nca 24-7 Spa 10.328 7.507 37,6%

IW Bank Spa 3.370 2.434 38,5%

BPU Banca International Sa 831 257 223,3%

BPU Sim Spa 804 -1.947 n.s.

BPU Pramerica SGR Spa 32.820 24.857 32,0% BPU Esaleasing Spa (2) 13.002 14.209 -8,5%

BPB Immobiliare Srl -29 3.362 n.s.Bergamo Esattorie Spa (3) - 2.113 n.s.Ancona Tributi Spa (3) - 1.062 n.s.

BPU Assicurazioni Spa 716 1.207 -40,7%

BPU Assicurazioni Vita Spa 6.603 4.770 38,4%

CONSOLIDATED 509.077 593.680 -14,3%

Profit for the period

(1) The figure to 30.9.2005 is pro-forma because it takes account of the merger of Investimenti Piccole Imprese. (2) The figure to 30.9.2005 is pro-forma because it takes account of the merger of Esaleasing into BPU Leasing, with

the change of name to BPU Esaleasing, concluded on 8th July 2006. (3) Bergamo Esattorie Spa and Ancona Tributi Spa were sold to Riscossioni Spa with effective date 30th September 2006. The consolidated profit for the first nine months of 2006 includes the relative profit on the sale of 5,8 million.

75

Figures in thousands of euro 30.9.2006 30.9.2005 % change

BPU BANCA 2.254.634 1.908.585 18,1%

BPB Spa 19.205.383 17.333.902 10,8%

BPCI Spa 8.890.975 8.480.998 4,8%

Banca Carime Spa 3.440.713 3.132.321 9,8%

Banca Popolare di Ancona Spa 6.436.034 5.933.838 8,5%

Banca Popolare di Todi Spa 380.231 324.755 17,1%

Centrobanca Spa (1) 5.603.810 5.101.003 9,9%

Banque de Dépôts et de Gestion Sa 198.528 196.904 0,8%

B@nca 24-7 Spa 2.454.495 1.610.084 52,4%

BPU Banca International Sa 59.677 66.909 -10,8%

IW Bank Spa 63.102 56.619 11,5% BPU Esaleasing Spa (2) 3.298.045 2.935.493 12,4%

CONSOLIDATED (*) 49.798.318 44.918.972 10,9%

Net loans to customers

Percentages 30.9.2006 30.9.2005 30.9.2006 30.9.2005 30.9.2006 30.9.2005

BPU BANCA - - - - - -

BPB Spa 0,52% 1,06% 0,68% 1,01% 1,20% 2,07%

BPCI Spa 0,90% 1,20% 1,29% 1,35% 2,19% 2,55%

Banca Carime Spa 0,37% 0,35% 0,89% 1,15% 1,26% 1,50%

Banca Popolare di Ancona Spa 1,04% 1,26% 1,43% 1,15% 2,47% 2,41%

Banca Popolare di Todi Spa 1,28% 1,83% 0,92% 1,08% 2,20% 2,91%Centrobanca Spa (1) 1,37% 3,33% 0,86% 1,99% 2,23% 5,32%

Banque de Dépôts et de Gestion Sa 0,07% 0,07% 0,51% 0,64% 0,58% 0,71%

B@nca 24-7 Spa 0,02% 0,03% 0,33% 0,22% 0,35% 0,25%

BPU Banca International Sa - - - - - -

IW Bank Spa - - 0,04% - 0,04% - BPU Esaleasing Spa (2) 0,21% 0,15% 0,58% 0,26% 0,79% 0,41%

CONSOLIDATED (*) 0,71% 1,24% 0,91% 1,15% 1,62% 2,39%

Net non performing loans + Net impaired loans / net lending

Net impaired loans / net lending

Net non performing loans / net lending

(1) The figure as at 30.9.2005 is pro-forma because it takes account of the merger of Investimenti Piccole Imprese. (2) The figure as at 30.9.2005 is pro-forma because it takes account of the merger of Esaleasing into BPU Leasing,

with the change of name to BPU Esaleasing, concluded on 8th July 2006. (*) The figure to 30.9.2005 is pro-forma because it takes account of the effects of classifying items for the tax

collection companies as assets held for disposal and of the reclassification of the items for BPU Centrosystem (the former Centrosiel) which had previously been classified under the item after tax profit/loss of non current assets held for sale

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Direct funding includes amounts due to customers and securities in issue, with the exclusion of bonds and subordinated liabilities subscribed directly by companies of the Group. Direct funding was adjusted as follows for the following banks (figures in millions of euro): BPU Banca: 131,1 (at 30.9.2005: 133,6); BPCI: 150,1 (at 30.9.2005: 150); BPA: 100,3 (at 30.9.2005: 100); Centrobanca: 355,7 (at 30.9.2005: 355,3); B@nca 24-7: 1.564 (at 30.9.2005: 528,3). (1) The figure as at 30.9.2005 is pro-forma because it takes account of the merger of Investimenti Piccole Imprese. (2) Direct funding does not include the policies of a predominantly financial character of BPU Assicurazioni Vita (recognised in the consolidated annual accounts under amounts due to customers), because they have been classified among assets under management (620 million euro at 30.9.2006 and 678,5 million euro at 30.9.2005).

Figures in thousands of euro 30.9.2006 30.9.2005 % change 30.9.2006 30.9.2005 % change

BPU BANCA 1.939 1.007 92,6% 19 - n.s

BPB Spa 23.979.964 22.815.358 5,1% 13.058.848 11.772.449 10,9%

BPCI Spa 14.596.041 14.126.480 3,3% 6.986.573 6.304.365 10,8%

Banca Carime Spa 6.621.207 6.750.349 -1,9% 4.808.354 4.892.338 -1,7%

Banca Popolare di Ancona Spa 4.153.930 4.014.764 3,5% 2.642.152 2.433.603 8,6%

Banca Popolare di Todi Spa 171.440 184.126 -6,9% 131.579 143.844 -8,5%

Banque de Dépôts et de Gestion Sa 1.519.300 1.522.579 -0,2% 1.519.300 1.522.579 -0,2%

B@nca 24-7 Spa - 521 -100,0% - 133 -100,0%

BPU Assicurazioni Vita Spa 2.705.170 2.540.047 6,5% 2.705.170 2.540.047 6,5%

BPU Pramerica Sgr Spa 21.993.543 19.416.397 13,3% 21.993.543 19.416.397 13,3%

BPU Banca International Sa 568.723 339.782 67,4% 83.690 72.831 14,9%

BPU Sim Spa 1.740.477 1.403.888 24,0% 1.694.073 1.370.556 23,6%

IW Bank Spa 1.570.650 936.831 67,7% 466.971 177.488 163,1% Aviva Vita Spa (3) 970.918 639.150 51,9% 970.918 639.150 51,9%

CONSOLIDATED (*) 55.263.106 52.132.737 6,0% 32.412.890 29.650.986 9,3%

Assets under management (at market prices)

Indirect funding from customers (at market prices)

Indirect funding from customers of individual companies is stated net of bonds held in custody issued by the companies themselves; consolidated indirect funding is stated net of bonds held in custody issued by Group member companies. (3) The figures relating to Aviva Vita Spa – jointly held on a 50-50 basis with Aviva Spa - are stated according to the

percentage of ownership (50%). (*) The consolidated figures as at 30.9.2005 are pro-forma because they take account of the effects of classifying items

for the tax collection companies as liabilities held for disposal and of the reclassification of the items for BPU Centrosystem (the former Centrosiel) which had been previously classified under the item after tax profit/loss of non current assets held for sale. The figure for direct funding has been adjusted for the policies of a predominantly financial character of BPU Assicurazioni Vita (recognised in the consolidated annual accounts under amounts due to customers), because they have been classified among assets under management (620 million euro at 30.9.2006 and 678,5 million euro at 30.9.2005).

Figures in thousands of euro 30.9.2006 30.9.2005 % change

BPU BANCA 6.339.610 5.658.998 12,0%

BPB Spa 19.765.343 18.755.049 5,4% BPCI Spa 6.851.509 6.835.005 0,2% Banca Carime Spa 7.004.894 6.878.266 1,8%

Banca Popolare di Ancona Spa 6.016.612 5.800.420 3,7% Banca Popolare di Todi Spa 351.875 304.299 15,6% Centrobanca Spa (1) 3.597.817 3.396.732 5,9%

Banque de Dépôts et de Gestion Sa 308.284 308.288 0,0% B@nca 24-7 Spa 28.477 24.503 16,2% BPU Assicurazioni Vita Spa (2) 28.179 77.391 -63,6%

BPU Pramerica Sgr Spa 16.888 6.500 159,8% BPU Banca International Sa 182.392 139.168 31,1% BPU Sim Spa 3.373 2.718 24,1%

IW Bank Spa 759.896 482.983 57,3%

CONSOLIDATED (*) 51.525.791 48.985.505 5,2%

Direct funding from customers

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Consolidated results by segment Distribution by business segment: income statement

Figures in thousands of euro

item/business segment Network

banks and SPV's

Centrobanca and Sintonia Finance Srl

Central unit (BPU Banca)

Other companies

TotalConsolidation adjustments

Total (as in consolidated accounts at 30.9.2006)

Net interest income 1.091.559 76.074 -56.234 147.421 1.258.820 5.879 1.264.699

Net commission income 502.453 16.095 -5.115 120.691 634.124 -24.339 609.785

Other expense/income 50.456 50.959 585.477 22.108 709.000 -549.648 159.352

Gross income 1.644.468 143.128 524.128 290.220 2.601.944 -568.108 2.033.836Net impairment losses on loans and financial assets -116.851 6.966 -149 -9.369 -119.403 - -119.403

Net financial operating income 1.527.617 150.094 523.979 280.851 2.482.541 -568.108 1.914.433Net result on insurance management - - - -26.523 -26.523 1.674 -24.849

Net income from financial and insurance operations 1.527.617 150.094 523.979 254.328 2.456.018 -566.434 1.889.584Administrative expenses -975.985 -33.759 -244.631 -144.460 -1.398.835 265.511 -1.133.324

Net provisions for liabilities and charges13.469 930 734 -1.280 13.853 - 13.853

Net impairment losses on tangible and intangible assets -20.721 -871 -46.332 -13.747 -81.671 -33 -81.704

Other operating income (expense) 99.587 4.165 218.596 44.515 366.863 -253.804 113.059

Operating costs -883.650 -29.535 -71.633 -114.972 -1.099.790 11.674 -1.088.116 Profits (losses) of equity investments 1.465 1.668 42.650 - 45.783 12.045 57.828

Net impairment losses on goodwill - - - - - - -

Profits (losses) on disposal of investments 835 2 22 42 901 -14 887

Profit (loss) on continuing operations before tax 646.267 122.229 495.018 139.398 1.402.912 -542.729 860.183

Distribution by business segment: balance sheetFigures in thousands of euro

item/business segment Network

banks and SPV's

Centrobanca and Sintonia Finance Srl

Central unit (BPU Banca)

Other companies

TotalConsolidation adjustments

Total (as in consolidated accounts at 30.9.2006)

Loans to banks 9.288.014 305.985 11.161.743 1.579.717 22.335.459 -20.427.868 1.907.591

Loans to customers 39.066.625 5.682.081 2.254.634 6.583.983 53.587.323 -3.789.005 49.798.318

Equity investments 133.723 7.589 5.503.874 127.576 5.772.762 -5.726.024 46.738

Other assets 3.789.422 3.213.468 7.168.920 3.975.511 18.147.321 286.558 18.433.879

Total assets 52.277.784 9.209.123 26.089.171 12.266.787 99.842.865 -29.656.339 70.186.526Amounts due to banks 3.973.471 3.708.794 14.885.605 4.139.678 26.707.548 -20.100.034 6.607.514

Amounts due to customers 27.462.092 13.985 807.318 2.063.703 30.347.098 -739.175 29.607.923

Securities in issue 13.597.180 4.024.698 5.663.425 2.479.369 25.764.672 -3.226.771 22.537.901

Other liabilities and shareholders’ equity 7.245.041 1.461.646 4.732.823 3.584.037 17.023.547 -5.590.359 11.433.188

Total liabilities 52.277.784 9.209.123 26.089.171 12.266.787 99.842.865 -29.656.339 70.186.526

The division by segment for segment reporting purposes has been performed by grouping companies according to type of business performed. A project is currently underway to measure the performance of the Group on the main sectors and markets on which it operates because of the new distribution structure organised by customer segment and the reporting requirements of IAS 14 and Basle 2. Once operational the new management reporting system will constitute the basis for periodical segment reporting required by IAS 14. The pages that follow contain a description of the performances recorded in the first nine months of 2006 by the Parent Bank, the main network banks and by Centrobanca which

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represent more than 85% of the total consolidated assets and make the most significant contribution to the generation of profit.

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The performance of the principal consolidated banks Banca Popolare di Bergamo Spa

Figures in thousands of euro

Balance sheetLoans to customers 19.205.383 17.333.902 10,8% 18.479.764Direct funding 19.765.343 18.755.049 5,4% 18.774.139Net interbank position 2.747.550 3.634.601 -24,4% 2.514.326Financial assets held for trading at fair value 86.260 120.098 -28,2% 102.774Available-for-sale financial assets 15.685 5.036 211,5% 16.510Shareholders’ equity (excluding profit) 1.333.756 1.290.991 3,3% 1.294.883

Indirect funding from customers (including insurance) 23.979.964 22.815.358 5,1% 23.016.204

of which: assets under management 13.058.848 11.772.449 10,9% 12.194.243Income statement

Net interest income 454.850 409.173 11,2% 547.100Net commission income 222.924 212.046 5,1% 287.209Net profit (loss) from trading, hedging and disposal/repurchase activities 12.475 4.666 167,4% 21.383Other net operating income / (expense) 15.129 16.010 -5,5% 21.295Operating income 705.378 641.895 9,9% 876.987Staff costs -197.054 -191.749 2,8% -265.176 Other administrative expenses -146.284 -144.461 1,3% -193.993

Net impairment losses on tangible and intangible assets -3.436 -4.015 -14,4% -5.335 Operating costs -346.774 -340.225 1,9% -464.504 Net operating income 358.604 301.670 18,9% 412.483Net impairment losses on loans -31.448 -29.085 8,1% -54.235 Net impairment losses on other assets/liabilities -1.347 977 n.s 720Net provisions for liabilities and charges 2.623 533 n.s -1.005 Profit/loss on the disposal of equity investments -22 4 n.s -32 Profit (loss) on continuing operations before tax 328.410 274.099 19,8% 357.931Taxation for the period -130.298 -117.452 10,9% -153.650 Profit for the period 198.112 156.647 26,5% 204.281

Other informationNumber of branches 375 376 -1 375

Number of employees 3.835 3.849 -14 3.827Financial ratios

R.O.E. (annualised) [Profit for the period/shareholders’ equity (excluding net profit for the year)] 19,80% 16,18% 15,78%

The cost/income ratio (operating costs/operating income) 49,16% 53,00% 52,97%Net non performing loans / Net loans to customers 0,52% 1,06% 0,63%Net impaired loans / Net loans to customers 0,68% 1,01% 0,97%

31.12.200530.9.2006 % change30.9.2005

The first nine months of 2006 ended with a net profit of 198,1 million euro, an increase of 26,5% compared to 156,6 million in the same period of 2005. Net operating income amounted to 358,6 million euro, an improvement of 18,9% (+56,9 million) as result of growth in income of close to 10% (+63,4 million), against a contained increase in operating costs (+6,5 million).

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Income items included good growth in net interest income to 454,9 million (+45,7 million, +11,2%), benefiting from increased volumes of business and favourable interest rate spreads above all on the funding side. Net commissions amounted to 222,9 million, with growth of more than 5% (+10,9 million) as a result of the following contributions: management, trading and advisory services (+6,6% to 120,7 million euro); collection and payment services (+3,3% to 21,7 million); other services (+3,4% to 72,3 million) driven by commissions on current accounts in particular (+11,8% to 53 million); guarantees granted (+4% to 8,3 million). Profits on trading and hedging activity almost tripled at 12,5 million euro and included a profit of 5 million on the disposal of non performing loans performed during the year. As concerns operating costs, staff costs show an increase of 2,8% to 197,1 million euro, due to a provision charge of 4,2 million relating to contract renewals and also reflect greater expenses incurred when variable components of remuneration related to the 2005 results were paid. Other administrative expenses amounted to 146,3 million, with a slight increase of 1,3%. The cost/income ratio improved by approximately 4 percentage points compared to September 2005, down to below 50% for the first time at 49,16%. After the net impairment losses and provisions detailed in the table, profit on continuing operations before tax recorded an increase of almost 20% to 328,4 million. As concerns the balance sheet, lending to customers rose to 19,2 billion euro, an increase during the twelve month period of more than 10%, buoyed by the two largest components of the aggregate, current accounts (+23,3% to 5,2 billion) and mortgage loans (+9% to 9,3 billion). Assisted by the effect of disposals of non performing loans, credit quality improved further, with net non performing loans to net lending of 0,52% (1,06% in September 2005) and a ratio of net impaired loans to net lending of 0,68% (1,01%). Annual performance on the funding front was also positive. Direct funding from customers, at 19,8 billion euro, recorded an increase of 5,4%, while indirect funding from private customers, at almost 24 billion euro, recorded an increase of 5,1% attributable to growth in assets under management, up by 11% to 13,1 billion euro. This component included growth in insurance products, up by 10,5% to 1,9 billion euro. Capital ratios at 30th September 2006 consisted of a tier 1 ratio (core capital/risk weighted assets) of 6,87% and a total capital ratio (supervisory capital/risk weighted assets) of 8,19%.

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Banca Popolare Commercio e Industria Spa

Figures in thousands of euro

Balance sheetLoans to customers 8.890.975 8.480.998 4,8% 8.432.220Direct funding (*) 7.001.606 6.985.005 0,2% 7.146.670Net interbank position -906.489 -316.491 186,4% -318.503 Financial assets held for trading at fair value 91.649 23.609 288,2% 74.481Available-for-sale financial assets 983 11 n.s. 2Shareholders’ equity (excluding profit) 726.335 715.287 1,5% 718.835

Indirect funding from customers (including insurance) 14.596.041 14.126.480 3,3% 13.953.627

of which: assets under management 6.986.573 6.304.365 10,8% 6.486.948Income statement

Net interest income 239.060 234.776 1,8% 313.710Dividend and similar income 2 1 100,0% 2Net commission income 125.617 121.791 3,1% 164.169Net profit (loss) from trading, hedging and disposal/repurchase activities -1.102 2.294 -148,0% 6.450Other net operating income / (expense) 4.852 5.023 -3,4% 5.331

Operating income 368.429 363.885 1,2% 489.662Staff costs -110.276 -113.529 -2,9% -145.347 Other administrative expenses -91.992 -98.645 -6,7% -128.391

Net impairment losses on tangible and intangible assets -3.154 -3.771 -16,4% -5.045

Operating costs -205.422 -215.945 -4,9% -278.783 Net operating income 163.007 147.940 10,2% 210.879Net impairment losses on loans -44.295 -48.184 -8,1% -73.257 Net impairment losses on other assets/liabilities -591 1.512 -139,1% 908Net provisions for liabilities and charges 5.103 -517 n.s. -572 Profit/loss on the disposal of equity investments - 25 -100,0% 25

Profit (loss) on continuing operations before tax 123.224 100.776 22,3% 137.983Taxation for the period -52.820 -47.828 10,4% -64.951

Profit for the period 70.404 52.948 33,0% 73.032Other information

Number of branches 223 225 -2 222

Number of employees 2.194 2.240 -46 2.251

Financial ratios

R.O.E. (annualised) [Profit for the period/shareholders’ equity (excluding net profit for the year)] 12,92% 9,87% 10,16%

The cost/income ratio (operating costs/operating income) 55,76% 59,34% 56,93%Net non performing loans / Net loans to customers 0,90% 1,20% 1,02%Net impaired loans / Net loans to customers 1,29% 1,35% 1,46%

31.12.200530.9.2006 % change30.9.2005

(*) Inclusive of bonds subscribed by Parent Bank amounting to 150,1 million (150 million at 31st December 2005; 150 million at 30th September 2005).

As a result of positive operating performance and lower impairment losses on the lending portfolio, the first nine months of 2006 ended with a net profit of 70,4 million euro, an increase of 33% compared to approximately 53 million recorded in the same period of 2005. Net operating income improved by 10,2% to 163 million (+15 million) as a result of a significant reduction in operating costs (-10,5 million, -4,9%) and higher income (+4,5 million, +1,2%).

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Income was sustained by growth in net interest income, up by 1,8% to more than 239 million as a result of increased volumes of business (+7,2% for lending, +3,2% for funding) and positive growth in net commissions, up by 3,1% to 125,6 million, the result above all of commissions generated by assets under management. On the expenses front there were reductions in both staff costs and other administrative expenses. The former amounted to 110,3 million (-2,9%) and benefited from a reduction in staff numbers, while other administrative expenses fell to approximately 92 million (-6,7%), reflecting lower expenses incurred for services provided by the Parent Bank (-12,1% to 49 million). As a result of the performance reported above, the cost/income ratio fell to 55,8%, an improvement of 3,5 percentage points compared to September 2005. Despite growth in lending, net impairment losses on loans decreased by 8% to 44,3 million. As a result of this performance, profit on continuing operations before tax improved by 22,3% to 123,2 million (+22,4 million). From an assets viewpoint, at 30th September 2006 loans to customers had increased by 4,8%, compared to 30th September 2005, to total 8,9 billion euro. This growth was attributable primarily to strong performance by mortgage lending (+22,3% to 3,1 billion), which came to account for 35% of the total. The disposal of approximately 20 million euro of non performing loans in the second quarter of 2006 helped to further improve risk ratios: the ratio of net non performing loans to net lending fell to 0,90% (it was 1,20% twelve months before) while the ratio of net impaired loans to net lending was 1,29% (1,35%). While direct funding from customers remained practically unchanged at 7 billion, indirect funding from private customers rose from 14,1 to 14,6 billion (+3,3%). It benefited from growth in assets under management (+10,8% to approximately 7 billion), within which customer portfolio management and mutual funds recorded the highest growth rates of +12,8% (to 1,8 billion) for customer portfolio managements and +14,1% (to 4 billion) for funds respectively. Capital ratios at 30th September 2006 consisted of a tier 1 ratio (core capital/risk weighted assets) of 7,82% and a total capital ratio (supervisory capital/risk weighted assets) of 9,50%.

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Banca Popolare di Ancona Spa

Figures in thousands of euro

Balance sheetLoans to customers 6.436.034 5.933.838 8,5% 6.153.098Direct funding (*) 6.116.903 5.900.420 3,7% 6.119.723Net interbank position -140.316 384.258 -136,5% 297.974Financial assets held for trading at fair value 63.796 36.489 74,8% 36.658Available-for-sale financial assets 8.287 7.865 5,4% 11.922Shareholders’ equity (excluding profit) 766.088 742.243 3,2% 761.250Indirect funding from customers (including insurance) 4.153.930 4.014.764 3,5% 4.038.399

of which: assets under management 2.642.152 2.433.603 8,6% 2.519.743Income statement

Net interest income 190.996 169.835 12,5% 229.740Dividend and similar income 24.935 24.786 0,6% 24.914Net commission income 70.103 63.350 10,7% 86.124Net profit (loss) from trading, hedging and disposal/repurchase activities 6.322 701 n.s. 5.811Other net operating income / (expense) 10.364 11.093 -6,6% 14.547

Operating income 302.720 269.765 12,2% 361.136Staff costs -95.877 -94.099 1,9% -125.877 Other administrative expenses -56.862 -48.612 17,0% -68.202

Net impairment losses on tangible and intangible assets -10.394 -9.876 5,2% -13.742

Operating costs -163.133 -152.587 6,9% -207.821 Net operating income 139.587 117.178 19,1% 153.315Net impairment losses on loans -33.609 -28.666 17,2% -51.069 Net impairment losses on other assets/liabilities 1.666 42 n.s. -3.419 Net provisions for liabilities and charges -223 -7 n.s. -45 Profit/loss on the disposal of equity investments 2.081 82.317 -97,5% 82.238

Profit (loss) on continuing operations before tax 109.502 170.864 -35,9% 181.020Taxation for the period -35.744 -30.764 16,2% -38.216

Profit for the period 73.758 140.100 -47,4% 142.804Other information

Number of branches 230 215 15 230Number of employees 1.768 1.742 26 1.770

Financial ratios

R.O.E. (annualised) [Profit for the period/shareholders’ equity (excluding net profit for the year)] 12,84% 25,17% 18,76%

The cost/income ratio (operating costs/operating income) 53,89% 56,56% 57,55%Net non performing loans / Net loans to customers 1,04% 1,26% 1,12%Net impaired loans / Net loans to customers 1,43% 1,15% 1,09%

31.12.200530.9.2006 % change30.9.2005

(*)Inclusive of bonds subscribed by Parent Bank amounting to 100,3 million (101 million at 31st December 2005; 100 million at 30th September 2005).

The first nine months del 2006 ended with a net profit of 73,8 million euro compared to 140,1 million in the same period of 2005 which, however, included the profit on the sale of Carifano amounting to 82,2 million. Net of that one-off component, the result for the period would have recorded growth of 27,31%, reflecting positive operating performance and the continued reduction in the cost/income ratio, now below 54%. In detail, income increased by 33 million (+12,2%), the result of an increase in net interest income (+21,2 million) – affected by the rise in rates and driven by growth in lending – and in

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net commission income (+6,8 million), fuelled again by assets under management, “bundled” current accounts and by credit cards. A significant contribution was made by trading and hedging activity (+5,6 million), which included profits of 4,1 million from the disposal of interests in Banca Italease Spa, Meliorbanca Spa and CIM Italy Spa and gains of 1,9 million from the disposal en bloc of non performing loans concluded in June. The contribution from dividends on the other hand remained stable: the Carifano dividends were no longer received (amounting to 8,8 million in 2005), but were offset by the extraordinary distribution in 2006 of 3,8 million from Ancona Tributi Spa before its transfer to Riscossione Spa and by the increase from 1,7 million to 4,2 million of the dividends from BPU Pramerica. On the expenses front, the main determinants of the changes in operating costs, which rose by 6,9% on an annual basis (+10,5 million), were a generalised increase in tariffs and services costs, including the increase in service costs by the Parent Bank, and the incurrence of additional expenses, amongst which there were also staff costs connected with the “Romagna Project”. In line with the growth in lending, there was also an organic increase in net impairment losses on loans to 33,6 million euro compared to 28,7 million del 2005. The item profits from the disposal of equity investments, amounting to 2,1 million, included 3,4 million euro as part of the additional earn-out price paid by Prudential International Investment Corporation and a loss of 2 million on the disposal of Ancona Tributi Spa. This item amounted to 82,3 million in 2005 and included the profit on the sale of Carifano already mentioned. As concerns the main balance sheet items, lending to customers increased to more than 6,4 billion euro (+8,5%), driven by mortgage lending, the largest and most dynamic component. As a result of the disposal of non performing loans already mentioned, the ratio of net non performing loans to net lending fell to 1,04%, while the ratio of net impaired loans to net lending rose to 1,43% as a consequence of the purchase by Carifano of the second tranche of “undesired” loans for a net book value of 14 million (in execution of the settlement agreement of 23rd March 2005) and, more generally, of a more rigorous classification of problem loans. Direct funding amounted to more than 6,1 billion euro (+3,7%), benefiting from a steady increase in the repayable on demand component and in bonds. Indirect funding exceeded 4,1 billion, mainly as a result of the contribution from assets under management (+8,6%), which now accounts for 63,6% of the total aggregate. Capital ratios at 30th September 2006 consisted of a tier 1 ratio (core capital/risk weighted assets) of 10,72% and a total capital ratio (supervisory capital/risk weighted assets) of 11,91%.

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Banca Carime Spa

Figures in thousands of euro

Balance sheetLoans to customers 3.440.713 3.132.321 9,8% 3.243.451Direct funding 7.004.894 6.878.266 1,8% 7.030.042Net interbank position 3.575.548 4.636.230 -22,9% 4.538.852Financial assets held for trading at fair value 819.348 13.402 n.s. 49.606Available-for-sale financial assets 8.481 5.462 55,3% 5.510Shareholders’ equity (excluding profit) 1.541.574 1.523.194 1,2% 1.540.349Indirect funding from customers (including insurance) 6.621.207 6.750.349 -1,9% 6.719.958

of which: assets under management 4.808.354 4.892.338 -1,7% 4.936.087Income statement

Net interest income 197.808 192.049 3,0% 255.866Dividend and similar income 2.022 2.211 -8,5% 2.233Net commission income 80.723 84.263 -4,2% 109.995Net profit (loss) from trading, hedging and disposal/repurchase activities 9.133 3.320 175,1% 4.482Other net operating income / (expense) 4.327 25.129 -82,8% 25.959

Operating income 294.013 306.972 -4,2% 398.535Staff costs -124.252 -151.394 -17,9% -197.275 Other administrative expenses -73.232 -74.203 -1,3% -99.168

Net impairment losses on tangible and intangible assets -9.369 -10.230 -8,4% -13.469

Operating costs -206.853 -235.827 -12,3% -309.912 Net operating income 87.160 71.145 22,5% 88.623Net impairment losses on loans -7.306 -8.213 -11,0% -12.269 Net impairment losses on other assets/liabilities 947 -151 n.s. 108Net provisions for liabilities and charges -1.260 -1.467 -14,1% -398 Profit/loss on the disposal of equity investments 147 3.060 -95,2% 2.827Profit (loss) on continuing operations before tax 79.688 64.374 23,8% 78.891Taxation for the period -31.235 -29.108 7,3% -36.948

Profit for the period 48.453 35.266 37,4% 41.943

Other information

Number of branches 325 325 - 324Number of employees 2.756 2.904 -148 2.807

Financial ratios

R.O.E. (annualised) [Profit for the period/shareholders’ equity (excluding net profit for the year)] 4,19% 3,09% 2,72%

The cost/income ratio (operating costs/operating income) 70,36% 76,82% 77,76%Net non performing loans / Net loans to customers 0,37% 0,35% 0,38%Net impaired loans / Net loans to customers 0,89% 1,15% 1,05%

31.12.200530.9.2006 % change30.9.2005

The income statement in the first nine months of the year recorded a profit of 48,5 million euro, an increase of more than 37% on an annual basis, the result of decreased costs which more than compensated for the fall in income, as summarised by the increase of 16 million (+22,5%) in net operating income. On the income side, net interest income increased by 3% to 197,8 million euro benefiting from growth in lending and an increased contribution by direct funding from customers. Net profit on trading also made a positive contribution to income (+5,8 million), attributable primarily to the portfolio managed by BPU Pramerica SGR.

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There was on the other hand a reduction in other operating income (-20,8 million) due entirely to the presence, in 2005, of non recurring income amounting to 21,7 million resulting from the settlement agreements with Banca Intesa and IBM. The modest reduction (-3,5 million) in net commission income mainly reflects a contraction in commissions on insurance investment policies. There was a significant reduction in operating costs, (-29 million) to which all components contributed in differing degrees. Staff costs fell by 27 million, the result of both a reduction in the number of employees through use of the income solidarity fund and leaving incentives and because of the absence in 2006 of 15 million of higher supplementary pension fund provision charges which had a negative effect on the accounts in 2005. The containment of other expense items was determined mainly by economies of scale achieved through the centralisation of services and functions at the Parent Bank level and also by lower depreciation and amortisation. Net impairment losses on loans also recorded a decrease from 8,2 million in 2005 to 7,3 million. As concerns the main asset items there was further growth in loans to customers which continued the positive trend already recorded in 2005 to reach almost 3,5 billion euro (+9,8% over twelve months). As concerns the type of lending, there was a particular increase in mortgage lending (+16% to approximately 2 billion) and also in short term lending (+2,6% to 1,2 billion). At the level of markets, average annual growth rates of 12,4% in the retail segment and of 9% in corporate segment were recorded. Credit quality remained high with a ratio of net non performing loans to net lending stable at 0,37% and a reduction in the ratio of net impaired loans to net lending to 0,89% as a result of a decrease in the stocks of 5,3 million (-14,8%). On the funding front, direct funding exceeded 7 billion (+1,8%), driven by bonds and current accounts in particular. In a context of a modest decrease in indirect funding to 6,6 billion, positive results were nevertheless achieved by life insurance policies and customer portfolio management. As concerns the situation for assets at 30th September 2006, there was a change in the composition of investments away from the interbank sector into financial assets held for trading, which rose to 819 million (managed by the Group’s asset management company under a specific mandate granted by Banca Carime). Capital ratios on that date consisted of a tier 1 ratio (core capital/risk weighted assets) of 16,04% and a total capital ratio (supervisory capital/risk weighted assets) of 19,41%.

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Centrobanca Spa

Figures in thousands of euro

Balance sheetLoans to customers 5.603.810 5.101.003 9,9% 5.389.483Direct funding (**) 3.953.520 3.752.052 5,4% 3.796.672Net interbank position -3.403.082 -3.009.091 13,1% -3.193.841 Financial assets held for trading at fair value 2.435.433 2.340.057 4,1% 2.354.752Available-for-sale financial assets 320.561 244.502 31,1% 301.969Shareholders’ equity (excluding profit) 569.309 557.500 2,1% 567.918

Income statementNet interest income 75.660 81.557 -7,2% 110.245Dividend and similar income 3.820 1.876 103,6% 2.049Net commission income 15.989 19.326 -17,3% 26.196Net profit (loss) from trading, hedging and disposal/repurchase activities 47.138 49.883 -5,5% 56.532Other net operating income / (expense) 2.722 2.148 26,7% 4.542

Operating income 145.329 154.790 -6,1% 199.564Staff costs -18.624 -18.267 2,0% -26.431 Other administrative expenses -13.601 -14.323 -5,0% -19.709

Net impairment losses on tangible and intangible assets -871 -892 -2,4% -1.206

Operating costs -33.096 -33.482 -1,2% -47.346 Net operating income 112.233 121.308 -7,5% 152.218Net impairment losses on loans 7.346 -9.925 n.s. -22.621 Net impairment losses on other assets/liabilities -16 -1.157 -98,6% 714Net provisions for liabilities and charges 930 1.263 -26,4% 1.430Profit/loss on the disposal of equity investments 1.670 5 n.s. -38

Profit (loss) on continuing operations before tax 122.163 111.494 9,6% 131.703Taxation for the period -51.659 -43.562 18,6% -64.024 Profit/loss on non current assets held for sale and discontiuned operations net of taxes - -28 n.s. -

Profit for the period 70.504 67.904 3,8% 67.679Other information

Number of branches 7 7 - 7Number of employees 304 300 4 300

Financial ratios

R.O.E. (annualised) [Profit for the period/shareholders’ equity (excluding net profit for the year)] 16,51% 16,24% 11,92%

The cost/income ratio (operating costs/operating income) 22,77% 21,63% 23,72%Net non performing loans / Net loans to customers 1,37% 3,33% 2,85%Net impaired loans / Net loans to customers 0,86% 1,99% 1,59%

31.12.2005 pro-forma (*)30.9.2006 % change30.9.2005 pro-

forma (*)

(*) Account is taken of the merger of Investimenti Piccole Imprese Spa into Centrobanca on 29 August 2006. (**) Inclusive of bonds subscribed by Parent Bank amounting to 355,7 million (350 million at 31st December 2005,

355,3 million at 30th September 2005). Centrobanca ended the first nine months of 2006 with a net profit of 70,5 million euro compared to 67,9 million in the same period of 2005 (+3,8%). Net of non recurring items profit increased by approximately 9,7% (from 44,7 to 49,1 million euro). The third quarter was characterised by strong growth in lending with new loans of more than 805 million euro amounting to 84 % of those acquired in the first six months of 2006. Total new lending in the nine month period therefore increased to 1.767 million, of which more than a quarter consisted of acquisition finance operations which almost tripled at more than 440

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million, proof of the active role played by the bank in assisting companies in Italy to grow in size. In terms of stock, growth in lending to customers amounted to approximately 0,5 billion during the twelve month period with a percentage increase of almost 10%. The performing component taken alone increased by 13,4% to approximately 5,5 billion euro, while net non performing loans and net impaired loans taken together contracted by more than 50% to 125 million euro, partly the result of disposals performed in the first nine months of 2006. As a consequence credit quality recorded a further improvement, with net non performing loans to net lending of 1,37% (3,33% in September 2005) and a ratio of net impaired loans to net lending of 0,86% (1,99%). The income statement recorded profit on continuing operations after tax for the first nine months of 2006 up by 9,6% to 122,2 million euro. On the income side operating income contracted by 9,5 million. More specifically, net interest income fell by 5,9 million to 75,7 million following the increase in interest rates, despite growth in the contribution from lending to customers (+10% a 56 million) which benefited from increased volumes. It suffered from a reduced contribution from financial investments (-6,7 million) and from capitalisation policies above all. Net commissions fell by 3,3 million, the result of a lower contribution from structured finance operations and from the postponement of the recognition of loan assessment commissions on new subsidised loans to the end of the year, which was only partly compensated for by higher income from investment banking activity (up from 1,5 to 5,1 million). The contribution of non recurring items to operating income (disposal of non performing loans and the disposal minority equity interests), amounting to 39 million, was basically unchanged compared to 2005 (37 million). On the costs front, careful monitoring policies resulted in a slight decrease in operating costs (-1,2%) to 33,1 million due to contained administrative expenses (-5% to 13,6 million), which more than compensated for the slight increase in staff costs connected with the increase in average staff numbers (306 compared to 301 in the first nine months of 2005). As concerns the cost of risk, case by case write downs of 4,1 million euro were made in the nine month period (4,6 million to September 2005) and collective write ups of approximately 12 million euro were made (against write downs of 6,5 in September 2005). The aggregate result for the item “net impairment losses on loans” was positive by 7,3 million in September 2006, while it was negative by 9,9 million in September 2005.

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Transactions with related parties In compliance with Consob Communications No. 97001574 of 20th February 1997, No. 98015375 of 27th February 1998, No. 1025564 of 6th April 2001 and lastly with Communication No. 14990 of 14th April 2005, we report that all transactions carried out by the Parent Bank with related parties were conducted in observance of correct principles both in substance and form under conditions analogous to those applied for transactions with independent parties. Following the repeal by the aforementioned CONSOB Communication of 14th April 2005 of the third paragraph of article 71-bis of CONSOB Regulation No. 11971/1999, by which the previous Communication No. 2064231 of 30th September 2002 defined the notion of related parties, since that definition is no longer valid, in accordance with IAS 24, a related party is considered to be related to the issuer if: a) it is directly or indirectly or controlled by or is under common control with the issuer; or it

holds an interest that allows it to exercise significant influence over the issuer; b) it is an associate of the issuer (as defined in IAS 28 - investments in associates); c) it is a joint venture in which the issuer is a venturer; d) he/she is a manager with strategic responsibilities of the issuer or of its parent, where a

manager with strategic responsibility is intended as meaning those who have power and responsibility for the planning, management and control of the activities of the issuer including its directors;

e) he/she is a close member of the family of one of the individuals referred to in (a) or (d) (a close family member is intended as meaning those who are potentially able to influence an individual related to the issuer or be influenced by them in their relations with the issuer);

f) the party is an entity that is controlled, jointly controlled or significantly influenced by any individual referred to in (d) or (e) or for which significant voting power in such entity resides with, directly or indirectly;

g) it is a pension fund for the employees of the issuer or of any entity related to it. In particular, the Parent Bank provides its subsidiaries with a series of services, governed by intragroup contracts drawn up in accordance with the principles of consistency, transparency and uniformity in line with the organisational model of the Group. Under this model, strategic, technical, operational and management activities are centralised at BPU Banca. The prices agreed for the services provided under the contracts were determined on the basis of market prices or, where appropriate reference parameters could not be found in the market, in accordance with the particular nature of the services provided, on the basis of the cost incurred. The main intragroup contracts existing at the end of the quarter included those to implement the policy to centralise the governance, support and business activities at the Parent Bank and which involved the Parent Bank and the main banks in the Group (Banca Popolare di Bergamo, Banca Popolare Commercio e Industria, Banca Carime, Banca Popolare di Ancona Spa and Banca Popolare di Todi Spa) and also contracts to implement the “national fiscal consolidation” (in accordance with articles 117 to 129 of Presidential Decree No. 917/1986, the consolidated law on income tax) concluded by the Parent Bank with nineteen Italian companies in the Group. As already reported in the Half Year Report to 30th June 2006 with regard to support services provided to the network banks, the Parent Bank appointed the company Gartner to provide an independent opinion on the fairness of the costs incurred by network banks for ICT and back office services based on a comparison with Italian banking groups with characteristics as comparable as possible with those of the BPU Group. The analyses, carried out on 2005 data, found that the costs of ICT and back office services were competitive. With regard to transactions performed in the first nine months of 2006 by the Parent Bank

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with all of its related parties, we report the following. ATYPICAL AND/OR UNUSUAL TRANSACTIONS

No atypical and/or unusual transactions were performed (see CONSOB Communication No. DEM/6064293 of 28th July 2006); furthermore no transactions of that type were performed with counterparties that were not related parties. Atypical and/or unusual transactions, as indicated in Consob Communications No. 98015375 of 27th February 1998 and No. 102564 of 6th April 2001, as well as DEM/6064293 of 28th July 2006 are intended to mean all those transactions which, because of their significance/entity, the nature of the counterparties, the content of the transaction (even in relation to ordinary operations), the way in which the transfer price is decided and the timing of the event (close to the end of the financial year) might give rise to doubts concerning: the correctness/completeness of the information in the accounts, a conflict of interests, the security of the companies assets and the rights of minority shareholders. NON RECURRING SIGNIFICANT EVENTS AND TRANSACTIONS

No non recurring significant transactions of transaction or facts occurred that do not recur frequently in the usual course of activities, neither with related parties nor with third parties other than related parties. TRANSACTIONS OF AN ORDINARY OR RECURRING NATURE

The table below gives the principal capital relations existing at 30th September 2006 between related parties of BPU Banca other than companies subject to control, joint control and significant influence (see the relative table for these) and the Parent Bank and/or the banks controlled by it. Transactions with related parties – principal capital items (Figures in thousands of euro) Table No. 48

30th September 2006 Related party Financial

assets held fortrading

Available-for-sale financial assets

Held-to-maturity investments

Loans to banks

Loans to customers

Due to banks

Due to customers

Guarantees granted

With BPU Banca Scpa Executives (1) - - - - - - 53 - Other related parties (2)

- - - - - - -

With subsidiary banks Executives (1) - - - - 1.401 - 10.325 - Other related parties (2)

- - - - 242.137 - 78.490 37.152

(1) An “executive” is intended as meaning “a manager with strategic responsibilities of the entity or of its parent, where a

manager with strategic responsibility is intended to mean those who have power and responsibility for the planning, management and control of the activities of the entity including its directors”;

(2) These are those indicated above under letters e), f) and g). As concerns the counterparties indicated above in points d) and e) and the main financial relations between these and the Parent Bank and the subsidiary banks, no significant amounts existed.

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The table below summarises the effects of transactions with related parties on the consolidated accounts. Transactions with related parties – summary of effects (Figures in thousands of euro) Table No. 49

30th September 2006 Financial

assets held for trading and at fair value

Available-for-sale financial assets

Loans to banks

Loans to customers

Other assets

Due to banks

Due to customers

Securities in issue

Other liabilities

With related parties (a) 54.518 37.467 10.283.143 2.424.532 293 9.058.745 661.757 131.133 28.029

Consolidated total (b) 8.346.864 3.552.858 1.907.591 49.798.318 1.542.564 6.607.514 29.607.923 22.537.901 1.683.919

“Loans to Banks” and “Due to banks” as a percentage of the total are not meaningful because the amounts attributable to related parties relate entirely to items which are eliminated when the consolidated accounts are prepared. “Loans to customers” relate mainly to loans which the Parent Bank has granted to the leasing companies in the Group, which are reciprocally eliminated entirely in the consolidated accounts. Further information on transactions with related parties is given in the following tables “Principal capital items with subsidiaries subject to control, joint control and significant influence” and “Principal profit and loss items with subsidiaries subject to control, joint control and significant influence”.

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Principal capital items with subsidiaries subject to control, joint control and significant influence at 30th September 2006

Financial assets heldfor trading (HFT)

Available-for-salefinancial assets (AFS) Loans to other banks Loans to customers Other assets Amounts due to

banksAmounts due to

customers Securities in issue Other liabilities Guarantees granted

Fully consolidated companies 54.518 14.425 10.283.143 2.170.875 293 9.058.745 572.889 131.133 28.029 1.138.417ALBENZA 2 SOCIETÀ PER LA CARTOLARIZZAZIONE SRL - - - - - - - - - -ALBENZA 3 SOCIETÀ PER LA CARTOLARIZZAZIONE SRL - - - - - - - - - -ALBENZA SRL - - - - - - - - - -B.D.G. FINANZIARIA SPA - - - - - - - - - -B@NCA 24-7 SPA - - 2.373.502 - - 28.670 - - - 15.798BANCA CARIME SPA - - 305.917 - 44 3.747.553 - 130.133 - 7BANCA POPOLARE COMMERCIO E INDUSTRIA CAPITAL TRUST - - - - - - - - - -BANCA POPOLARE COMMERCIO E INDUSTRIA FUNDING LLC - - - - - - 117.519 - - 123.350BANCA POPOLARE COMMERCIO E INDUSTRIA SPA - - 1.864.162 - 55 854.179 - - - 8BANCA POPOLARE DI ANCONA SPA - - 726.450 - - 482.005 - - - 81.695BANCA POPOLARE DI BERGAMO CAPITAL TRUST - - - - - - - - - -BANCA POPOLARE DI BERGAMO SPA FUNDING LLC - - - - - - 315.605 - - -BANCA POPOLARE DI BERGAMO SPA - - 911.565 - 143 3.616.697 - - - 18.916BANCA POPOLARE DI TODI SPA - - 28.650 - - 35.687 - - - 12BANQUE DE DÉPOTS ET DE GESTION SA - - 20.212 - - 11.101 - - - 1.547BPB IMMOBILIARE SRL - - - 1.561 51 - 935 - - -BPU ASSICURAZIONI SPA - - - 5.692 - - 1.481 1.000 - -BPU ASSICURAZIONI VITA SPA - - - 8.686 - - 1.671 - - -BPU BANCA INTERNATIONAL SA - - 27.346 - - 163.248 - - - 8.965BPU CENTROSYSTEM SPA - - - - - - - - - -BPU ESALEASING SPA - 14.425 - 2.153.073 - - 7.827 - 26.678 24.689BPU MEDIAZIONI ASSICURATIVE SRL - - - 6 - - 1.074 - - -BPU PARTECIPAZIONI ASSICURATIVE SPA - - - 204 - - 303 - - -BPU PRAMERICA ALTERNATIVE INVESTMENTS SGR SPA - - - - - - 5.000 - - -BPU PRAMERICA SGR SPA - - - 573 - - 118.223 - - -BPU SOCIETÀ DI INTERMEDIAZIONE MOBILIARE SPA - - - 666 - - 2.668 - - 25.000CENTROBANCA SPA 3 - 4.024.145 - - 32.465 - - - 838.430CENTROBANCA SVILUPPO IMPRESA SGR SPA - - - 4 - - - - - -CORALIS RENT SPA - - - - - - - - - -FINANZATTIVA SERVIZI SRL - - - - - - 52 - 1.351 -IMMOBILIARE BPU SRL - - - 17 - - - - - -IW BANK SPA - - 1.194 - - 87.140 - - - -MERCATO IMPRESA SPA - - - 274 - - 456 - - -ORIO FINANCE NR. 1 PLC 27.348 - - - - - 7 - - -ORIO FINANCE NR. 2 PLC 17.541 - - - - - 3 - - -ORIO FINANCE NR. 3 PLC 9.626 - - - - - - - - -PLURIFID SPA - - - 119 - - 65 - - -SINTONIA FINANCE SRL SPA - - - - - - - - - -

Companies valued using proportional method - 23.042 - - - - - - - -

BPU TRUST COMPANY LTD - - - - - - - - - -

BY YOU SPA SPA - - - - - - - - - -POLIS FONDI SGRPA - 23.042 - - - - - - - -

Companies valued using the equity method - - - 10.119 - - - - - -

ARCA SGR SPA - - - - - - - - - -

AVIVA VITA SPA - - - 10.118 - - - - - -

CAPITAL MONEY SPA - - - - - - - - - -

GROUP SRL - - - - - - - - - -

SECUR BROKER SRL - - - 1 - - - - - -

SF CONSULTING SRL - - - - - - - - - -

SOFIPO FIDUCIAIRE SA - - - - - - - - - -

SPF STUDIO PROGETTI FINANZIARI SRL - - - - - - - - - -

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Principal profit and loss items with subsidiaries subject to control, joint control and significant influence at 30th September 2006

INTEREST INCOME INTEREST EXPENSE COMMISSIONINCOME

COMMISSIONEXPENSES DIVIDENDS ADMINISTRATIVE

EXPENSESOTHER INCOME AND

EXPENSES

Fully consolidated companies 239.654 -215.289 3.413 -4.992 487.129 -26.122 217.805ALBENZA 2 SOCIETÀ PER LA CARTOLARIZZAZIONE SRL - - 51 - - - -ALBENZA 3 SOCIETÀ PER LA CARTOLARIZZAZIONE SRL - - 35 - - - -ALBENZA SRL - - 41 - - - -B.D.G. FINANZIARIA SPA - - - - 955 - 8B@NCA 24-7 SPA 49.825 - 1 -171 6.600 496 1.546BANCA CARIME SPA 1.128 -96.135 5 -951 39.077 -14.401 41.859BANCA POPOLARE COMMERCIO E INDUSTRIA CAPITAL TRUST - - - - - - -BANCA POPOLARE COMMERCIO E INDUSTRIA FUNDING LLC - -7.676 - - - - -BANCA POPOLARE COMMERCIO E INDUSTRIA SPA 24.977 -3.109 299 -616 56.894 -608 54.599BANCA POPOLARE DI ANCONA SPA 4.161 -7.493 28 -837 133.410 -7.710 24.683BANCA POPOLARE DI BERGAMO CAPITAL TRUST - - - - - - -BANCA POPOLARE DI BERGAMO SPA FUNDING LLC - -18.819 - - - - -BANCA POPOLARE DI BERGAMO SPA 4.573 -33.662 127 -1.164 155.781 -2.533 93.959BANCA POPOLARE DI TODI SPA 405 -115 - -34 - - 642BANQUE DE DÉPOTS ET DE GESTION SA - - - - - -7 25BPB IMMOBILIARE SRL - - - - - -47 191BPU ASSICURAZIONI SPA - - - - - -2 54BPU ASSICURAZIONI VITA SPA 91 - - - - -36 32BPU BANCA INTERNATIONAL SA 593 -3.631 - - 235 63 16BPU CENTROSYSTEM SPA - - - - - 48 -BPU ESALEASING SPA 43.985 -342 233 - 10.678 392 207BPU MEDIAZIONI ASSICURATIVE SRL - - - - 950 102 9BPU PARTECIPAZIONI ASSICURATIVE SPA - - - - 5.950 - -BPU PRAMERICA ALTERNATIVE INVESTMENTS SGR SPA - - - - - - -BPU PRAMERICA SGR SPA - -2.034 518 -500 16.891 69 159BPU SOCIETÀ DI INTERMEDIAZIONE MOBILIARE SPA - - - - - 246 528CENTROBANCA SPA 108.243 -41.233 2.075 -695 58.957 113 236CENTROBANCA SVILUPPO IMPRESA SGR SPA - - - - - - 12CORALIS RENT SPA - - - - - - -FINANZATTIVA SERVIZI SRL - - - - - -116 -1.339IMMOBILIARE BPU SRL - - - - - -42 57IW BANK SPA 50 -1.040 - - - -934 142MERCATO IMPRESA SPA - - - -24 400 -1.215 179ORIO FINANCE NR. 1 PLC 796 - - - - - -ORIO FINANCE NR. 2 PLC 521 - - - - - -ORIO FINANCE NR. 3 PLC 306 - - - - - -PLURIFID SPA - - - - 351 - 1SINTONIA FINANCE SRL SPA - - - - - - -

Companies valued using proportional method - - - - 51 171 38BPU TRUST COMPANY LTD - - - - - - -BY YOU SPA SPA - - - - - 171 38POLIS FONDI SGRPA - - - - 51 - -

Companies valued using the equity method - - - - 2.623 - -ARCA SGR SPA - - - - 1.619 - -

AVIVA VITA SPA - - - - 1.000 - -

CAPITAL MONEY SPA - - - - - - -

GROUP SRL - - - - - - -

SECUR BROKER SRL - - - - 4 - -

SF CONSULTING SRL - - - - - - -

SOFIPO FIDUCIAIRE SA - - - - - - -

SPF STUDIO PROGETTI FINANZIARI SRL - - - - - - -

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Other information Information on corporate litigation With decision No. 2228/06, deposited on 16th September 2006, the Court of Appeal of Milan confirmed the ruling in the first instance by the Court Varese of 6th September 2003, fully rejecting the applications made by the former Chairman of the Board of Directors of Banca Popolare di Luino e Varese with regard to BPU Banca, and ordered the former to pay full legal costs in favour of BPU amounting to 12.411,27 euro. The ruling concerned the application to render null and void a resolution passed by Banca Popolare di Luino e Varese on 3rd April 2001, which confirmed and ratified the application for compensation for damages made, in accordance with Art. 129 of Legislative Decree No. 58/1998, by Banca Popolare Commercio e Industria (as a shareholder of Banca Popolare di Luino e Varese) with regard to the aforementioned Chairman of the Board of Directors of the latter.

* * * As concerns the decision on the application to render null and void ruling No. 144/2006 of the Court of Varese, which had ordered the former Chairman of Banca Popolare di Luino e Varese to pay damages for civil liability matters connected with the directors’ mandate of the aforementioned Banca Popolare di Luino e Varese, at the first hearing held on 2nd October 2006 before the Court of Appeal of Milan, the case was adjourned until 5th June 2007.

* * * Finally, as concerns the settlement agreement of 23rd March 2005 and more specifically the request made by the Carifano Foundation for shareholders’ agreements to be observed, BPU Banca and BPA are continuing to work, in the context of the talks underway between the five former shareholders of BPA and the Carifano, for the request advanced by the Foundation to be satisfied by those five former shareholders, who have in any case agreed to hold both BPU Banca and BPA free from liability. The pattichiari project On 31st July 2006, the network banks of the Group adhered to the tenth PattiChiari initiative entitled “Change Account – how to change your current account”. The initiative was decided by the PattiChiari Consortium in the light of the increasing demands from customers, the press and the institutions, including the Authority for Competition and the Market. The objective of the initiative is to change the mistaken and widespread belief that it is impossible to change bank, by seeking on the one hand to eliminate the “information barrier” which customers may run into when discovering how to close a current account and by simplifying the procedures for closing accounts and making them more transparent, on the other hand. To achieve this, the banks in the Group made a commitment to provide customers, and private customers in particular, with clear and simple information on the procedures and time required to close a current account, and also to monitor the timing and to follow interbank procedures for transferring direct debit instructions for utilities payment. The timing is in three distinct stages:

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1) the “Change Account” guide is made available and delivered, starting on 16th October 2006; 2) from 15th December 2006 onwards, customers are provided (on explicit request) with a

report listing the services provided with their current accounts and the time required to close it, which is monitored. Then in July 2007 the average time required for banks to close accounts is published on the PattiChiari site and a table of the average times taken by banks is delivered to customers;

3) from 12th February 2007, interbank procedures for transferring direct debit instructions for utilities payments are activated.

As for the other nine initiatives of the PattiChiari project, a certification protocol was drawn up which describes not only the organisational and procedural aspects, but also aspects concerning customer relations. SACE Agreement On 19th September 2006 BPU Banca signed an agreement with SACE (Company for insuring export loans) to provide insurance services to support the growth of Italian small to medium size enterprises abroad. The General Convention proposed by SACE allows the BPU Group to employ more streamlined procedures to provide its customers with innovative instruments to support them in penetrating new markets, rich in opportunities, but also with risks attached. More specifically the range of countries that can be insured was broadened to offer corporate exporters the chance to sell or reduce risk positions arising from business with countries where there is a high political and/or commercial risk. Furthermore, again with regard to exports, Italian operators are offered the chance to meet the financial needs of foreign purchasers, who are able to obtain easier terms of payment on supplies precisely as a result of covering political and commercial risks with SACE. The main services covered by the General Convention are as follows: confirmation of documentary credits with possible related loans; silent confirmation (a procedure commonly used on Asian markets); long and short term loans granted to foreign banks and to public and private sector entities

and enterprises. Change in the organisational structure of BPU Banca In order to simplify corporate organisational structure and also in consideration of the provisions contained in Law No. 262 of 12th January 2006 concerning “Measures for the protection of investment and the discipline of financial markets”, two new macro areas were created as of 1st October 2006: “Governance” and “Administration and Compliance”. All the existing Staff Areas, “Risk Management”, “Planning and Control”, “Strategic Development and Integration” and “International Development” have been brought within the Governance Macro Area together with the Investor Relations function. The “Accounts and Administration” and the “General Business” areas as well as the “Compliance” and “Purchasing” functions have been brought within the Administration and Compliance Macro Area, which will be headed by a senior manager responsible for preparing company accounting documents under Art. 154 bis of Legislative Decree No. 58/1998 (consolidated law on finance) introduced by article 14 of Law 262/2005 already mentioned.

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ORGANISATION CHART OF BPU BANCA

Auditing Area reports on a dotted line basis to the Board of Directors through the Committee for Internal control

General Management

Organisation, Systems and

ServicesHuman Resources Finance Division Lending Division Commercial

Division

Auditing

MANAGING DIRECTOR

EXECUTIVE COMMITTEE

BOARD OF DIRECTORS

MANAGEMENT COMMITTEE

FISCAL ASSISTANCE ANDSPECIAL PROJECTS

Governancemacroaerea

Administration & Compliancemacroaerea

Auditing Area reports on a dotted line basis to the Board of Directors through the Committee for Internal control

General Management

Organisation, Systems and

ServicesHuman Resources Finance Division Lending Division Commercial

Division

Auditing

MANAGING DIRECTOR

EXECUTIVE COMMITTEE

BOARD OF DIRECTORS

MANAGEMENT COMMITTEE

FISCAL ASSISTANCE ANDSPECIAL PROJECTS

Governancemacroaerea

Administration & Compliancemacroaerea

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Important events occurring after 30th September 2006 No events of importance that might affect the operating and financial situation presented occurred after 30th September 2006, the balance sheet date of this Consolidated Quarterly Report, and before 13th November 2006, the date of its approval, except for those concerning the prospects for the merger operation with Banca Lombarda, to which a specific section of this report is dedicated. The following operations occurred after the end of the third quarter concerning companies belonging to the Group, which have already been commented on in the earlier section “The consolidation area”, which may be consulted:

- on 4th October the respective Boards of Directors approved the merger of Immobiliare BPU into BPB Immobiliare and on the following 30th October the transfers of the interests held by BPU Banca and by Banca Carime in Immobiliare BPU to BPB Immobiliare were concluded;

- new agreements were signed on 5th October concerning the functioning of the industrial joint venture By You Spa;

- on 9th October a shareholders’ meeting of IW Bank resolved an increase in the share capital without option rights, in order to list the bank;

- on 30th October contracts were signed for the sale to BPU Centrosystem of ICT assets or lines of business by 12 non core companies of the Group and the contract for the supply of ICT services between BPU Centrosystem and the outside supplier was also signed.

- on 7th November a shareholders’ meeting of Banca Popolare di Todi and the Board of Directors of Banca Popolare di Ancona gave final approval for the merger of BPT into BPA.

As part of the EMTN programme, BPU Banca made two new issues respectively on 30th October 2006, for 300 million euro and on the 3rd November for further 250 million. It was also decided to raise the maximum limit for issues from 7 to 10 billion euro, which will only become effective after it is approved by the London Stock Exchange. Finally on 13th November the Boards of Directors of BPU Banca and Banca Carime approved the sale of 15 Banca Carime branches located in not very competitive positions to Banca Popolare Pugliese. Merger hypothesis In the current period of strong change in the Italian banking industry the management of BPU Banca has moved forward with an number of analyses and assessments of possible options for strategic growth. In a press release of 7th August 2006 BPU Banca informed markets of the manifestation of an interest, communicated to Banca Popolare Italiana, in jointly exploring possible merger opportunities. The subsequent contacts between advisors and representatives of the two parties led to the inclusion of BPU Banca in the competition process initiated by BPI. BPU Banca’s offer was of a preliminary non binding nature and was in any case subject to the study of factors after the outcome of the due diligence investigation. These consisted of the need to examine the last inspection report of the Bank of Italy and also to hold meetings with the management to examine the industrial plan of Banca Popolare Italiana. Once the Board of Directors of Banca Popolare Italiana, with the assistance of its advisors, had examined the information provided by each of the four candidate banks, on 4th October it

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resolved to request binding offers from Banco Popolare di Verona e Novara and Banca Popolare dell’Emilia Romagna only, therefore excluding both BPU Banca and Banca Popolare di Milano from the final phase. Banca Lombarda e Piemontese On 13th November 2006, the Boards of Directors of Banche Popolari Unite Scpa and Banca Lombarda e Piemontese S.p.A. unanimously approved the plan for the merger of Banca Lombarda into BPU Banca for the creation of a New Banking Group. The parties to the shareholders’ agreement of Banca Lombarda decided in favour of the merger plan. MAIN OPERATIONAL DIMENSIONS AND THE INDUSTRIAL PLAN

The merger operation will result in the formulation of an industrial plan with high strategic value, given the complementarity between the network banks, the product companies and the customers. The model adopted with be a polyfunctional, federal and integrated model with a listed ‘Popular’ parent bank. The new Group, with a total market capitalisation of 13,5 million, will be the fourth Italian banking operator in terms of the number of Branches and on the basis of pro-forma figures as at 30th June 2006, it will have: - more than 4 million customers; - direct funding of approximately 80 billion euro (5th highest in Italy, the first for ‘popular’

banks); - lending to customers of approximately 79 billion euro (5th highest in Italy, the first for

‘popular’ banks); - high asset quality with a ratio of non performing to net loans of 0,7%; - a stock of assets under management of approximately 58 billion euro (3rd highest in Italy,

the first for ‘popular’ banks), of which 23 billion euro relating to private banking business (3rd highest in Italy, the first for ‘popular’ banks);

- total assets of approximately 110 billion (6th highest in Italy, 2nd for ‘popular’ banks); - shareholders’ equity of 7,4 billion (fully diluted); - a total pro-forma net profit of 745 million to 30th September 2006; - a core tier 1 ratio of 6,2% (fully diluted) and a total capital ratio of 10,1% (fully diluted); - a network of 1.970 Branches (4th largest branch network in Italy, with a market share of

6,3%), with no significant overlap; - significant market share in the wealthiest areas in the country (2nd largest banking group in

Lombardy with 935 Branches and a market share of 15%); - market share in terms of Branches of higher than 10% in 21 provinces, including Bergamo

(26%), Brescia (29%), Varese (29%), Cuneo (26%), Pavia (18%) and Milan (10%). The principal strategic guidelines are as follows: - the creation of a new Group capable of both competing with the best players on the market

and also of further enhancing the value of its deep roots in local markets where identities and brand names will be conserved;

- the achievement of important growth objectives assisted by geographical contiguity and complementarity in high potential growth areas, with an increase in critical masses and exploitation of the culture and skills of each of the two groups;

- an increase in customer support activities, above all for small to medium size enterprises and households, by broadening the range of services and products offered;

- enhancing the value of the product companies present in the two original groups, by, amongst other things, creating partnerships with international operators of high standing;

- rapid achievement of expected synergies due, amongst other things, to the proven track record of the management teams of both groups in managing integration processes.

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The operation will allow the new Group to benefit from synergies resulting from: - optimisation of human resources in various infrastructure areas; - the reduction of IT costs following the adoption of a single Group ITC platform; - the containment of administrative expenses as a result, amongst other things, of the

stronger negotiating leverage of the new Group; - enhancing the value of product companies on a broader scale as a result, amongst other

things, of partnerships with international operators of high standing and further improvement of quality standards for products and services for customers;

- the best practices of each Group become common practice in all the new Group (both in terms of costs and income).

Gross estimated synergies amount to 365 million euro per year, of which approximately 225 million euro from reduced costs and approximately 140 million euro from higher income. These will be fully phased in by 2010, with more than 90% of synergies achievable by 2009. Gross integration costs have been conservatively estimated at approximately 380 million euro of which 360 million euro to be charged to income statement in 2007 and 20 million euro recognised as an increase in goodwill. The resulting potential creation of value will consequently be in the order of more than 2,3 billion euro, and that is net of integration costs. The principal financial objectives of the new Group for 2009 are as follows: - net profit of more than 1,4 billion euro; - a cost/income ratio of less than 45% and ROE of more than 17%; - core tier 1 higher than 7%. The dividend policy of the New Parent Bank will not be not lower than the current policy of BPU Banca. THE STRUCTURE OF THE OPERATION AND FINANCIAL CONDITIONS

The operation will be implemented by merging Banca Lombarda into BPU Banca, with ‘popular’ co-operative bank status maintained. The financial conditions will be subject to confirmation by a due diligence investigation and will consist of a swap ratio of 0,83 BPU Banca ordinary shares for each Banca Lombarda ordinary share. The dividend proposed for 2006 will be 0,80 euro per share for all the shareholders of the new Parent Bank. The post merger composition of the share capital will consist of approximately 54% of the shares held by BPU Banca shareholders and approximately 46% of the shares held by former Banca Lombarda shareholders. It is agreed that the shareholders of Banca Lombarda will be automatically entered in the register of the registered shareholders of the new Parent Bank when the deed of merger is signed and takes effect. Shareholders absent, dissenting or abstaining at the General Meeting of the Shareholders of Banca Lombarda will have the right to opt out in accordance with article 2437 of the Italian Civil Code, on the grounds of the change in the type of company and modifications to voting rights. The merger will be subject to the condition that the right to opt out granted to shareholders of Banca Lombarda is not exercised by more than 10% of the share capital. However, this condition may be waived by common agreement between the parties within 10 working days following the date on which the final data on the exercise of the right to opt out by shareholders has been communicated by Banca Lombarda to BPU Banca. The merger will lead to the integration of the two parent banks with the creation of a single listed legal entity, able to formulate strategic policies, to perform the functions of co-ordination

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and to exercise control over all the units and companies in the new Group, in which the network banks will maintain their operational autonomy and presence in their traditional markets. CORPORATE GOVERNANCE

The new Parent Bank, which will be formed by the merger of Banca Lombarda into BPU Banca, will have its registered offices at Bergamo, while centralised functions will be distributed between the sites of the two Groups with a balanced division, which takes account of functional and economic demands. The name of the new Parent Bank will be jointly decided by common agreement between the parties at a later stage. In order to guarantee a system of corporate governance which provides solid unified management and governance and at the same time represents the original components of the BPU Banca and Banca Lombarda groups in the new banking group on an equal partners basis, a dual system of governance will be adopted based on a Supervisory Board and a Management Board and characterised by further principles of alternating the principal management posts. The Supervisory Board of the new Parent Bank will be composed of 23 members (11 appointed by BPU Banca, 11 by Banca Lombarda and one from minority interest lists) and will include the Chairman, one Senior Deputy Chairman and two Deputy Chairmen. The first Chairman of the Supervisory Board will be named by Banca Lombarda, while the first Senior Deputy Chairman will be named by BPU Banca. The Management Board will be composed of between 7 and 11 members and will be appointed by the Supervisory Board. The Management Board will be composed of 10 members for the first three year term of office (5 from BPU Banca and 5 from Banca Lombarda) and will include the Chairman, the Deputy Chairman and the Managing Director. The first Chairman of the Management Board will be Emilio Zanetti, the first Deputy Chairman will be Corrado Faissola and the first Managing Director will be Giampiero Auletta Armenise. Further more the parties agreed that the Chairman Mr. Zanetti will remain in the post of Chairman of the Management Board for the second three year term also. The General Manager will be appointed by the Management Board. Victor Massiah, the current General Manager of Banca Lombarda, will be appointed as the first General Manager. Alfredo Gusmini, the current General Manager of BPU Banca will become a member of the Management Board. The Joint General Manager will be named by BPU Banca.

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PROBABLE TIMING OF THE OPERATION

The timing of the merger plan will be as follows: 14th November 2006: communication of the operation to markets November/December 2006: publication of the notice to call extraordinary general meetings of

the shareholders of BPU Banca and Banca Lombarda for the approval of the merger plan

by the first half of December 2006: approval of the merger plan by Boards of Directors March 2007: Extraordinary General Meetings for the approval of the merger

plan 1st April 2007: merger takes effect April/May 2007: Ordinary General Meeting to approve the proposal to distribute a

dividend of 0,80 euro per share May 2007 distribution of the dividend The operation is subject to authorisation by the Bank of Italy , by the Antitrust Authority and by other relevant authorities. BPU Banca is advised by Banca Leonardo and by Morgan Stanley with particular reference to markets and operating and financial aspects and by Studio Pedersoli for the legal aspects. Banca Lombarda is advised by Mediobanca and Rothschild for the operating and financial aspects and by Studio d’Angelo and Studio Pavesi-Gitti-Verzoni for the legal aspects. The presentation of the merger plan to markets and the press has been scheduled for 14th November 2006.

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Likely future developments for consolidated operations The expected performance for income and the basic stability of operating costs compared to 2005 will allow the objectives of the Industrial Plan to be exceeded. As concerns income, the positive trend for lending to customers should strengthen the tendency seen in the third quarter of net interest income to improve with respect to the two previous quarters. Net commission income is also expected to recover in the last quarter of the year. As concerns problem loans, the performance in the first nine months has confirmed the positive tendency, with total net impairment losses lower than in the 2005 financial year. Bergamo, 13th November 2006

THE BOARD OF DIRECTORS

103

ACCOUNTING POLICIES AND CONSOLIDATED ANNUAL ACCOUNTS TO 30TH SEPTEMBER 2006

104

105

Accounting policies Declaration of compliance with IAS/IFRS This quarterly report to 30th September 2006 of the Banche Popolari Unite Group, approved by the Board of Directors on 14th November 2006, has been prepared in compliance with the international accounting standards issued by the International Accounting Standards Board (IASB) and homologated at the date of publication and also in compliance with the related interpretations of the International Financial Reporting Interpretation Committee (see in this respect the “list of IAS/IFRS standards homologated by the European Commission”)15. It relates to the companies included in the consolidation, details of which are given in the section “The consolidation area”, contained in the initial pages of this report. This interim report has been prepared in compliance with article 82 of the Issuers Regulations and in application of IAS 34 “Interim Financial Reporting”. It is composed of the balance sheet, income statement, statement of changes in shareholders’ equity, statement of cash flows, (not subject to audit by the independent auditors), as well as the notes and comments on operations, and it relates to the Parent bank, Banche Popolari Unite Scpa, and the companies belonging to the Group of the same name (subsidiaries, associates and companies subject to joint control). General principles of preparation These accounts to 30th September 2006 have been prepared on a going concern basis, in application of pro-rata, accrual accounting principles. The statements of cash flows were prepared on a cash accounting basis. This interim report has been prepared using the euro as the accounting currency; the balance sheet, income statement, cash flows and the notes have been presented in thousands of euro. The financial statements comply with the provisions of Bank of Italy Circular No. 262/2005 and in addition to the accounts as at 30th September 2006 they provide the following comparison information:

– balance sheet: 30th September 2005 and 31st December 2005; – income statement: 30th September 2005 and 3rd quarter 2005; – statement of changes in shareholders’ equity: 30th September 2005; – statement of cash flows: 30th September 2005.

The Balance Sheet presentation defined in Bank of Italy Circular No. 262/2005 lists assets and liabilities in order of decreasing liquidity. The income statement recognises expenses and income according to their nature. In addition to complying with specific Bank of Italy instructions, this treatment also provides more meaningful information with regard to the distinction between current and non current balance sheet items. 15 The IAS/IFRS international accounting standards listed there are applied on the basis of events occurring that are

disciplined by it. Furthermore, the Group has not adopted the accounting standard IFRS 7 “financial instruments: disclosures” in this interim report; application of this is compulsory as of 1st January 2007.

106

Use of estimates In compliance with IAS 34, a more extensive use of estimates has been made with respect to annual reports without, however, impairment to reliability (see the CONSOB communication No. 5073567 of 4th November 2005). Furthermore, in compliance with that accounting standard, this interim report does not provide all the information which, on the other hand, must be reported in an annual financial report. Other information At the balance sheet date there were no: - situations in which the direct or indirect ownership through subsidiaries of more than half

the actual or potential voting rights of an investee did not constitute control; - significant restrictions on the capacity of subsidiaries to transfer funds to the Parent Bank

in payment of dividends or repayment of loans or any other type debt. The balance sheet dates of all the companies included in the consolidation were the same as the balance sheet date of the interim accounts of the Parent Bank. Accounting standards The same accounting standards have been applied in these interim accounts as those used in the preparation of the annual accounts as at 31st December 2005, with the additions described in the Half Year Report to 30th June 2006. Those documents may be consulted for full information.

107

List of the main IAS/IFRS standards homologated by the European Commission

IAS/IFRS ACCOUNTING STANDARDS APPROVAL

IAS 1 Presentation of Financial Statements Reg. 2238/2004, amend. 1910/2005, 108/2006

IAS 2 Inventories Reg. 2238/2004 IAS 7 Statement of cash flows Reg. 1725/2003 amend.

2238/2004 IAS 8 Accounting Policies, Changes in Accounting Estimates,

and Errors Reg. 2238/2004

IAS 10 Events after the balance sheet date Reg. 2238/2004 IAS 11 Construction contracts Reg. 1725/2003

IAS 12 Taxes on income Reg. 1725/2003 amend. 2236/2004, 2238/2004, 211/2005

IAS 14 Segment Reporting Reg. 1725/2003 amend. 2236/2004, 2238/2004, 108/2006

IAS 16 Property, plant and equipment Reg. 2238/2004 amend. 211/2005, 1910/2005

IAS 17 Leasing Reg. 2238/2004, 108/2006 IAS 18 Revenues Reg. 1725/2003 amend.

2236/2004

IAS 19 Employee benefits Reg. 1725/2003 amend. 2236/2004, 2238/2004, 211/2005, 1910/2005

IAS 20 Accounting for government grants and disclosure of government assistance

Reg. 1725/2003 amend. 2238/2004

IAS 21 The effects of changes in foreign exchange rates Reg. 2238/2004 IAS 23 Borrowing costs Reg. 1725/2003 amend.

2238/2004 IAS 24 Related party disclosures Reg. 2238/2004 amend.

1910/2005 IAS 26 Retirement benefit plans Reg. 1725/2003 IAS 27 Consolidated and separate financial statements Reg. 2238/2004 IAS 28 Investments in associates Reg. 2238/2004 IAS 29 Financial reporting in hyperinflationary economies Reg. 1725/2003 amend.

2238/2004 IAS 30 Disclosures in the financial statements of banks and

financial institutions Reg. 1725/2003 amend. 2238/2004

IAS 31 Interests in companies subject to joint control Reg. 2238/2004

IAS 32 Financial instruments: disclosure and presentation Reg. 2237/2004 amend. 2238/2004, 211/2005, 1864/2005, 108/2006

IAS 33 Earnings per share Reg. 2238/2004 amend. 211/2005, 108/2006

IAS 34 Interim financial reporting Reg. 1725/2003 amend. 2236/2004, 2238/2004

IAS 36 Impairment of assets Reg. 2236/2004 amend. 2238/2004

IAS 37 Provisions, contingent liabilities and contingent assets Reg. 1725/2003 amend. 2236/2004, 2238/2004

IAS 38 Intangible assets Reg. 2236/2004 amend. 2238/2004, 211/2005, 1910/2005

IAS 39 Financial instruments: recognition and measurement

Reg. 2086/2004 amend. 2236/2004, 211/2005, 1751/2005, 1864/2005, 1910/2005, 2106/2005, 108/2006

IAS 40 Investment properties Reg. 2238/2004

IAS 41 Agriculture Reg. 1725/2003 amend. 2236/2004, 2238/2004

108

IFRS 1 First-time adoption of international financial reporting standards

Reg. 707/2004 amend. 2236/2004, 2237/2004, 2238/2004, 211/2005, 1751/2005, 1864/2005, 1910/2005, 108/2006

IFRS 2 Share-based payment Reg. 211/2005 IFRS 3 Business combinations Reg. 2236/2004 IFRS 4 Insurance contacts Reg. 2236/2004, 108/2006 IFRS 5 Non-current assets held for sale and discontinued

operations Reg. 2236/2004

IFRS 6 Exploration for and evaluation of mineral resources Reg. 1910/2005 IFRS 7 Financial instruments: disclosures Reg. 108/2006

SIC/IFRIC INTERPRETATION DOCUMENTS APPROVAL

IFRIC 1 Changes in existing decommissioning, restoration and similar liabilities

Reg. 2237/2004

IFRIC 2 Members' shares in co-operative entities and similar instruments

Reg. 1073/2005

IFRIC 4 Determining whether an arrangement contains a lease Reg. 1910/2005 IFRIC 5 Rights to interests arising from decommissioning,

restoration and environmental funds Reg. 1910/2005

IFRIC 6 Liabilities arising from participating in a specific market - waste electrical and electronic equipment

Reg. 108/2006

IFRIC 7 Applying the restatement approach under IAS 29 “Financial reporting in hyperinflationary economies”

Reg. 708/2006

IFRIC 8 Scope of IFRS 2 Reg. 1329/2006 IFRIC 9 Reassessment of Embedded Derivatives Reg. 1329/2006 SIC 7 Introduction of the euro Reg. 1725/2003 amend.

2238/2004

SIC 10 Government assistance – no specific relation to operating activities

Reg. 1725/2003

SIC 12 Consolidation – special purpose entities Reg. 1725/2003 amend. 2238/2004, 1751/2005

SIC 13 Jointly controlled entities – non-monetary contributions by venturers

Reg. 1725/2003 amend. 2238/2004

SIC 15 Operating leases – Incentives Reg. 1725/2003

SIC 21 Income taxes – Recovery of revalued non-depreciable assets

Reg. 1725/2003 amend. 2238/2004

SIC 25 Income taxes – Changes in the tax status of an enterprise or its shareholders

Reg. 1725/2003 amend. 2238/2004

SIC 27 Evaluating the substance of transactions in the legal form of a lease

Reg. 1725/2003 amend. 2238/2004

SIC 29 Disclosure – service concession arrangements Reg. 1725/2003

SIC 31 Revenue – Barter transactions involving advertising services

Reg. 1725/2003 amend. 2238/2004

SIC 32 Intangible assets – Website costs Reg. 1725/2003 amend. 2236/2004, 2238/2004

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Consolidated accounts to 30th September 2006

110

Consolidated balance sheet

Figures in thousands of euro30.9.2006 31.12.2005 30.9.2005

ASSETS

10. Cash and cash equivalents 288.059 373.734 260.938

20. Financial assets held for trading 3.055.892 2.208.420 6.987.925

30. Financial assets at fair value 5.290.972 5.158.686 -

40. Available-for-sale financial assets 3.552.858 3.721.162 3.329.610

50. Held-to-maturity financial assets 1.227.145 1.061.634 998.965

60. Loans to banks 1.907.591 3.331.015 4.121.703

70. Loans to customers 49.798.318 47.460.761 44.959.558

80. Hedging derivatives 186.238 205.256 265.100

90. Fair value change of hedged financial assets 10.288 29.331 41.804

100. Equity investments 46.738 32.859 42.770

110. Technical reserves of reinsurers 98.773 104.146 106.035

120. Tangible assets 1.348.157 1.377.538 1.363.852

130. Intangible assets 1.259.704 1.238.995 1.224.430

- goodwill 1.209.622 1.197.147 1.192.313

140. Tax assets 573.229 706.822 877.034

a) current 181.150 294.217 195.369

b) deferred 392.079 412.605 681.665

150. Non current assets and disposal groups held for sale - 298 9.274

160. Other assets 1.542.564 1.852.977 1.824.194

70.186.526 68.863.634 66.413.192TOTAL ASSETS

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Figures in thousands of euro30.9.2006 31.12.2005 30.9.2005

LIABILITIES AND SHAREHOLDERS’ EQUITY

10. Due to banks 6.607.514 6.366.914 5.046.285

20. Due to customers 29.607.923 29.443.712 28.841.107

30. Securities in issue 22.537.901 20.925.250 20.850.925

40. Financial liabilities held for trading 449.994 348.941 409.504

50. Financial liabilities at fair value - - -

60. Hedging derivatives 320.679 321.093 245.240

70. Fair value change in hedged financial liabilities (+/-) - - -

80. Tax liabilities 526.596 622.277 893.859

a) current 337.581 388.078 282.977

b) deferred 189.015 234.199 610.882

90. Liabilities associated with disposal groups held for sale - 8 1.249

100. Other liabilities 1.683.919 2.780.199 2.224.932

110. Staff severance payments 342.700 350.052 351.182

120. Provisions for liabilities and charges: 337.037 331.781 359.373

a) pension and similar obligations 156.645 163.138 165.329

b) other provisions 180.392 168.643 194.044

130. Technical reserves 2.473.415 2.247.693 2.246.493

140. Valuation reserves 120.395 241.838 233.089

150. Reimbursable shares - - -

160. Capital instruments - - -

170. Reserves 1.858.920 983.031 911.584

180. Issue premiums 1.543.578 1.943.203 1.941.442

190. Share capital 861.135 860.124 859.603

200. Own shares (-) - - -

210. Minority interests (+/-) 405.743 416.658 403.645

220. Profit (loss) for the period (+/-) 509.077 680.860 593.680

70.186.526 68.863.634 66.413.192TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

112

Consolidated income statement

Figures in thousands of euro30.9.2006 30.9.2005 27.6.1905 3rd Quarter

20063rd Quarter

2005

10. Interest and similar income 2.103.108 1.818.316 2.508.452 744.184 587.820

20. Interest expense and similar -838.409 -613.364 -890.010 -317.713 -184.469

30. NET INTEREST INCOME 1.264.699 1.204.952 1.618.442 426.471 403.351

40. Commission income 712.429 702.121 945.610 218.413 236.960

50. Commission expenses -102.644 -96.092 -127.486 -32.740 -30.455

60. NET COMMISSION INCOME 609.785 606.029 818.124 185.673 206.505

70. Dividend and similar income 10.355 9.032 10.183 867 443

80. Net profit (loss) from trading 21.297 60.020 90.445 16.482 5.802

90. Net profit (loss) from hedging activity 4.126 2.430 3.613 -2.817 -7.047

100. Net profit (loss) from sale or the repurchase of: 123.574 66.359 91.301 6.402 23.740

a) loans 38.478 36.869 57.908 2.951 25.147

b) available-for-sale financial assets 83.641 30.126 33.224 4.212 -956

c) held-to-maturity financial assets - - - 12 -

d) financial liabilities 1.455 -636 169 -773 -451

110. Net profit (loss) on financial assets and liabilities at fair value - - - - -

120. GROSS INCOME 2.033.836 1.948.822 2.632.108 633.078 632.794

130. Net impairment losses on: -119.403 -119.714 -213.503 -46.907 -33.551

a) loans -120.008 -120.673 -212.148 -46.452 -33.661

b) available-for-sale financial assets -164 5 -75 -14 -46

c) held-to-maturity financial assets - - - - -

d) other financial transactions 769 954 -1.280 -441 156

140. NET FINANCIAL OPERATING INCOME 1.914.433 1.829.108 2.418.605 586.171 599.243

150. Net premiums 350.655 346.032 476.359 103.294 120.091

160. Other net profit (loss) on insurance operations -375.504 -362.568 -494.679 -115.340 -125.441

170. NET INCOME FROM FINANCIAL AND INSURANCE OPERATIONS 1.889.584 1.812.572 2.400.285 574.125 593.893

180. Administrative expenses -1.133.324 -1.143.040 -1.544.188 -363.504 -382.602

a) staff costs -755.410 -761.341 -1.027.757 -240.358 -258.307

b) other administrative expenses -377.914 -381.699 -516.431 -123.146 -124.295

190. Net provisions for liabilities and charges 13.853 -28.970 -34.603 2.072 -4.768

200. Net impairment losses on tangible assets -60.470 -56.458 -76.941 -20.559 -19.345

210. Net impairment losses on intangible assets -21.234 -14.305 -26.296 -9.704 -4.749

220. Other operating income (expense) 113.059 123.237 166.114 36.474 32.200

230. OPERATING COSTS -1.088.116 -1.119.536 -1.515.914 -355.221 -379.264

240. Profits (losses) on equity investments 57.828 232.096 238.304 24.055 115.410

250. Net result of fair valuation of tangible and intangible assets - - - - -

260. Net impairment losses on goodwill - - - - -

270. Profits (losses) on disposal of investments 887 156 -267 453 -123

280. PROFIT (LOSS) ON CONTINUING OPERATIONS BEFORE TAX 860.183 925.288 1.122.408 243.412 329.916

290. Taxes on income for the period for continuing operations -317.731 -300.584 -397.797 -98.574 -98.315

300. PROFIT (LOSS) ON CONTINUING OPERATIONS AFTER TAX 542.452 624.704 724.611 144.838 231.601

310.Profit (Loss) after tax on non current assets held for sale and discontinued operations

- 298 -17 -5.839 -4.169

320. PROFIT (LOSS) FOR THE PERIOD 542.452 625.002 724.594 138.999 227.432

330. Profit (loss) for the period attributable to minority interests -33.375 -31.322 -43.734 -10.268 -11.634

340. PROFIT (LOSS) FOR THE PERIOD ATTRIBUTABLE TO THE PARENT BANK 509.077 593.680 680.860 128.731 215.798

Basic EPS (Earnings Per Share) 1,8757 2,2066 1,9289

Diluted EPS (Earnings Per Share) 1,8757 2,2050 1,9278

FY2005

113

Statement of changes in consolidated shareholders’ equity as at 30th September 2006

Figures in thousands of euro of Group of others of Group of others of Group of others of Group of others of Group of others of Group of others of Group of others of Group of others

Share capital: 860.124 - - - 860.124 - - - - - - 1.011 - - - - 861.135 -

a) ordinary shares 860.124 - - - 860.124 - - - - - - 1.011 - - - - 861.135 -

b) other shares - - - - - - - - - - - - - - - - - -

Issue premiums 1.943.203 - - - 1.943.203 - - - - -402.629 - 3.004 - - - - 1.543.578 -

Reserves 983.031 366.293 33.037 1.040 1.016.068 367.333 392.105 43.734 - 450.289 -39.831 - - 458 - - 1.858.920 371.236 a) of profits 847.018 17.144 - - 847.018 17.144 392.105 43.734 - -231 -36.302 - - - - - 1.238.892 24.576

b) other 136.013 349.149 33.037 1.040 169.050 350.189 - - - 450.520 -3.529 - - 458 - - 620.028 346.660

Valuation reserves: 241.838 6.631 -10.677 -149 231.161 6.482 - - - -110.766 -5.350 - - - - - 120.395 1.132a) available-for-sale financial assets 109.985 966 - - 109.985 966 - - - -60.200 -478 - - - - - 49.785 488

b) cash flow hedging 2.796 431 - - 2.796 431 - - - -2.523 -377 - - - - - 273 54

c) exchange rate differences -243 - - - -243 - - - - - - - - - - - -243 -

d) special revaluation laws 129.300 5.234 -10.677 -149 118.623 5.085 - - - -48.043 -4.495 - - - - - 70.580 590

Capital instruments - - - - - - - - - - - - - - - - - -

Own shares: - - - - - - - - - - - - - - - - - -

a) of the parent bank - - - - - - - - - - - - - - - - - -

b) of subsidiaries - - - - - - - - - - - - - - - - - -

Profit for the period 680.860 43.734 - - 680.860 43.734 -392.105 -43.734 -288.755 - - - - - 509.077 33.375 509.077 33.375

Shareholders’ equity 4.709.056 416.658 22.360 891 4.731.416 417.549 - - -288.755 -63.106 -45.181 4.015 - 458 509.077 33.375 4.893.105 405.743

Shareholders’ equity at 30.9.2006

Allocation of prior year profit

Dividends and other

uses

Changes in opening balances

Balances at 1.1.2006Balances at 31.12.2005

Stock options

Changes in reservesReserves

Changes January - September 2006

Profit for the periodNew share issues

“Changes in reserves of profits” attributable to minority interests includes 34.261 thousand euro for dividends and other uses. See the section “The property revaluation” in the “notes and comments on consolidated operations” contained in another part of this report for information on the modification of the opening balances.

114

Statement of changes in consolidated shareholders’ equity to 30th September 2005

Figures in thousands of euro of Group of others of Group of others of Group of others of Group of others of Group of others of Group of others of Group of others of Group of others

Share capital: 856.128 - - - 856.128 - - - - - - 3.475 - - - - 859.603 -

a) ordinary shares 856.128 - - - 856.128 - - - - - - 3.475 - - - - 859.603 -

b) other shares - - - - - - - - - - - - - - - - - -

Issue premiums 1.929.506 - - - 1.929.506 - - - - - - 11.936 - - - - 1.941.442 -

Reserves 946.087 584.077 -134.271 -373.271 811.816 210.806 98.802 33.463 - 2.412 115.686 - - 458 - - 913.488 359.955a) of profits 798.506 42.571 - -16.183 798.506 26.388 48.512 33.463 - - -35.229 - - - - - 847.018 24.622

b) other 147.581 541.506 -134.271 -357.088 13.310 184.418 50.290 - - 2.412 150.915 - - 458 - - 66.470 335.333

Valuation reserves: 3.304 1.453 256.164 13.497 259.468 14.950 - - - 55.976 1.447 - - - - - 315.444 16.397 a) available-for-sale financial assets - - 55.317 910 55.317 910 - - - 60.261 273 - - - - - 115.578 1.183

b) cash flow hedging - - 7.169 562 7.169 562 - - - -2.242 421 - - - - - 4.927 983

c) exchange rate differences - - -243 - -243 - - - - - - - - - - - -243 -

d) special revaluation laws 3.304 1.453 193.921 12.025 197.225 13.478 - - - -2.043 753 - - - - - 195.182 14.231

Capital instruments - - - - - - - - - - - - - - - - - -

Own shares: - - - - - - - - - - - - - - - - - -

a) of the parent bank - - - - - - - - - - - - - - - - - -

b) of subsidiaries - - - - - - - - - - - - - - - - - -

Profit for the period 290.123 28.022 58.690 5.441 348.813 33.463 -98.802 -33.463 -250.011 - - - - - 593.680 31.322 593.680 31.322

Shareholders’ equity 4.025.148 613.552 180.583 -354.333 4.205.731 259.219 - - -250.011 58.388 117.133 15.411 - 458 593.680 31.322 4.623.657 407.674

Changes January - September 2005

Profit for the periodNew share issues

Shareholders’ equity at 30.9.2005

Allocation of prior year profit

Dividends andother uses

Balances at 31.12.2004 Balances at 1.1.2005

Stock options

Changes in reserves

Changes in opening balances

Reserves

Application of Law No. 266/E of 23rd December 2005 on the revaluation of property: compared to the figures reported in the quarterly report to 30th September 2005, the balances of the valuation reserves for special revaluation laws are different from those attributable to the Parent Bank by 82.125 thousand euro and for those attributable to other shareholders by 4.144 thousand euro. Similarly the other reserves attributable to the Group increased by 276 thousand euro and those attributable to other shareholders by 33 thousand euro.

115

Figures in thousands of euro 30.9.2006 30.9.2005

602.917 896.186 - net profit for the year (+/-) 509.077 593.839

- gains/losses on financial assets held for trading and on financial assets/liabilities held at fair value (+/-)

-21.297 -60.020

- gains/losses on hedging activities (-/+) -4.126 -2.430 - net impairment losses on loans (+/-) 119.404 119.714 - net impairment losses on tangible and intangible fixed assets (+/-) 81.704 70.762 - net provisions for liabilities and charges and other expense/income (+/-) -13.853 28.970 - net premiums not received (-) - - - other insurance income/expense not received(-/+) - - - outstanding taxes and duties 37.912 156.614

- net impairment losses on disposal groups held for sale after tax (-/+) - -298

- other adjustments (+/-) -105.904 -10.965

-1.824.463 2.373.267 - financial assets held for trading -826.175 850.226 - financial assets at fair value -132.286 - - available-for-sale financial assets 168.139 337.230 - lending to banks: repayable on demand - - - lending to banks: other loans 1.423.424 -96.712

- loans to customers -2.457.565 1.282.523

1.618.332 -2.633.267 - due to banks repayable on demand - - - due to banks other payables 240.600 -400.328 - due to customers 164.211 -345.294 - securities in issue 1.612.651 -1.131.416 - financial liabilities held for trading 101.053 -119.046 - financial liabilities at fair value - -

- other liabilities -500.183 -637.183

396.786 636.186

89.468 532.057 - disposals of equity investments 60.340 248.207 - dividends received on equity investments - - - disposals of held-to-maturity financial assets 13.896 - - disposals of tangible assets 7.175 201.073 - disposals of intangible assets 8.057 82.777

- disposals of subsidiaries and lines of business - -

-283.174 -997.784 - purchases of equity investments -16.390 0

- purchases of held-to-maturity financial assets -179.407 -782.513

- purchases of tangible assets -37.377 -112.670

- purchases of intangible assets -50.000 -102.601

- purchases of subsidiaries and lines of business - -

-193.706 -465.727

- issues/purchases of own shares - -

- - issues/purchases of capital instruments - -

- distribution of dividends and other means -288.755 -250.011

-288.755 -250.011

-85.675 -79.552

Net liquidity generated/absorbed by financing activities

NET LIQUIDITY GENERATED/ABSORBED DURING THE PERIOD

1. Ordinary activities

C. FINANCING ACTIVITIES

Consolidated statement of cash flows (indirect method)

1. Liquidity generated by

2. Liquidity absorbed by

Net liquidity generated/absorbed by investing activities

2. Liquidity generated/absorbed by financial activities

3. Liquidity generated/absorbed by financial liabilities

Net liquidity generated/absorbed by operating activities

B. INVESTMENT ACTIVITIES

A. OPERATING ACTIVITIES

Legend: (+) generated (-) absorbed

116

Balance sheet items 30.9.2006 30.9.2005

Cash and cash equivalents at beginning of period 373.734 340.371

Total liquidity generated/absorbed -85.675 -79.552

Cash and cash equivalents: effect of changes in exchange rates - -

Cash and cash equivalents at the end of the period 288.059 260.819

Reconciliation

117

Consolidated accounts: comparison figures

118

In order to allow comparability with the figures in the balance sheet and income statements to 30th September 2006, the figures to 30th September 2005 have been restated, where appropriate, on a uniform basis. The reclassifications have been performed for a variety of reasons:

• instructions concerning specific classifications by the supervisory authority were not issued until after the preparation of the quarterly report to 30th September 2005 (Circular No. 262 was issued on 22nd December 2005 and published in the Official Gazette No. 11 of 14th January 2006);

• in the months that followed the first time adoption of IAS/IFRS, refinements were made which required the restatement of prior period figures (e.g. the classification of arrears of interest received and previously written off, which was defined as falling under item 10 “Interest income” instead of item 130a “Net impairment losses on loans”);

• finally reclassifications made by various Group member companies were adopted to guarantee the uniform classification.

A comparison is given below between the comparison accounts in the mandatory schemes of this quarterly report and those which have already been published in previous financial reports.

119

Consolidated balance sheet: comparisons between published accounts

Figures in thousands of euro

30.9.2005 current

30.9.2005 published in

2005

ASSETS

10. Cash and cash equivalents 260.938 261.853

20. Financial assets held for trading 6.987.925 6.982.260

30. Financial assets at fair value - -

40. Available-for-sale financial assets 3.329.610 3.329.610

50. Held-to-maturity financial assets 998.965 998.965

60. Loans to banks 4.121.703 4.126.249

70. Loans to customers 44.959.558 44.932.270

80. Hedging derivatives 265.100 270.76690. Fair value change of hedged financial assets 41.804 41.804

100. Equity investments 42.770 42.770

110. Technical reserves of reinsurers 106.035 106.035

120. Tangible assets 1.363.852 1.363.852

130. Intangible assets 1.224.430 1.244.302

of which: goodwill 1.192.313 1.192.313

140. Tax assets 877.034 875.532

a) current 195.369 193.867

b) deferred 681.665 681.665

150. Non current assets and disposal groups held for sale 9.274 9.274

160. Other assets 1.824.194 1.827.650

TOTAL ASSETS 66.413.192 66.413.192

Figures in thousands of euro

30.9.2005 current

30.9.2005 published in

2005

LIABILITIES AND SHAREHOLDERS’ EQUITY10. Due to banks 5.046.285 5.046.50720. Due to customers 28.841.107 28.902.32130. Securities in issue 20.850.925 20.850.92540. Financial liabilities held for trading 409.504 389.93350. Financial liabilities at fair value - - 60. Hedging derivatives 245.240 264.425

70. Fair value change in hedged financial liabilities (+/-) - -

80. Tax liabilities 893.859 891.194

a) current 282.977 280.353

b) deferred 610.882 610.841

90. Liabilities associated with disposal groups held for sale 1.249 1.249

100. Other liabilities 2.224.932 2.241.613

110. Staff severance payments 351.182 351.182

120. Provisions for liabilities and charges: 359.373 360.019

a) pension and similar obligations 165.329 165.329

b) other provisions 194.044 194.690

130. Technical reserves 2.246.493 2.170.781

140. Valuation reserves 233.089 233.089

150. Reimbursable shares - -

160. Capital instruments - -

170. Reserves 911.584 911.584

180. Issue premiums 1.941.442 1.941.442

190. Share capital 859.603 859.603

200. Own shares (-) - -

210. Minority interests (+/-) 403.645 403.645

220. Profit (loss) for the period (+/-) 593.680 593.680

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 66.413.192 66.413.192

120

Consolidated income statement: comparisons between published accounts

Figures in thousands of euro

30.9.2005 current

30.9.2005 published in

200510. Interest and similar income 1.818.316 1.831.956

20. Interest expense and similar -613.364 -641.766

30. NET INTEREST INCOME 1.204.952 1.190.19040. Commission income 702.121 700.067

50. Commission expenses -96.092 -91.762

60. NET COMMISSION INCOME 606.029 608.30570. Dividend and similar income 9.032 9.355

80. Net profit (loss) from trading 60.020 59.570

90. Net profit (loss) from hedging activity 2.430 -1.103

100. Net profit (loss) from sale or the repurchase of: 66.359 66.341

a) loans 36.869 36.869

b) available-for-sale financial assets 30.126 30.108

c) held-to-maturity financial assets - -

d) financial liabilities -636 -636

110. Net profit (loss) on financial assets and liabilities at fair value - -

120. GROSS INCOME 1.948.822 1.932.658130. Net impairment losses on: -119.714 -114.538

a) loans -120.673 -115.497

b) available-for-sale financial assets 5 5

c) held-to-maturity financial assets - -

d) other financial transactions 954 954

140. NET FINANCIAL OPERATING INCOME 1.829.108 1.818.120150. Net premiums 346.032 346.032

160. Other net profit (loss) on insurance operations -362.568 -362.568

170. NET INCOME FROM FINANCIAL AND INSURANCE OPERATIONS 1.812.572 1.801.584180. Administrative expenses -1.143.040 -1.133.381

a) staff costs -761.341 -744.430

b) other administrative expenses -381.699 -388.951

190. Net provisions for liabilities and charges -28.970 -26.088

200. Net impairment losses on tangible assets -56.458 -56.453

210. Net impairment losses on intangible assets -14.305 -22.194

220. Other operating income (expense) 123.237 129.573

230. OPERATING COSTS -1.119.536 -1.108.543 240. Profits (losses) on equity investments 232.096 232.096

250. Net result of fair valuation of tangible and intangible assets - - 260. Net impairment losses on goodwill - -

270. Profits (losses) on disposal of investments 156 151

280. PROFIT (LOSS) ON CONTINUING OPERATIONS BEFORE TAX 925.288 925.288290. Taxes on income for the period for continuing operations -300.584 -300.584

300. PROFIT (LOSS) ON CONTINUING OPERATIONS AFTER TAX 624.704 624.704

310. Profit (Loss) after tax on non current assets held for sale and discontinued operations 298 298

320. PROFIT (LOSS) FOR THE PERIOD 625.002 625.002330. Profit (loss) for the period attributable to minority interests -31.322 -31.322

340. PROFIT (LOSS) FOR THE PERIOD ATTRIBUTABLE TO THE PARENT BANK 593.680 593.680 The main reclassifications in the income statement are as follows:

- net interest income increased by 14,8 million, of which 12,1 million attributable to the reclassification of interest expense resulting from the present valuation of the staff severance provision, income support provisions and the provision for liabilities and charges under specific items (staff costs amounting to 9,2 million and net impairment losses amounting to 2,9 million);

- net impairment losses on loans (item 130a) increased by 5,2 million, following the reclassification of positive items to item 10 “interest income”, mainly in application of the new method of accounting for arrears of interest received;

- staff costs (item 180a) increased by 16,9 million following the reclassification of present valuation from item 20 “interest expense” amounting to 9,2 million and recognition of charges for directors fees and for “atypical contracts” amounting to 6,2 million;

- depreciation of improvements to leased assets was reclassified, from item 210 “net impairment losses on intangible assets” to item 220 “other operating costs/income”, and it amounted to 8 million.

121

INFORMATION ON THE PERFORMANCE OF THE PARENT BANK IN THE FIRST NINE MONTHS OF 2006

122

BPU Banca: performance in the period

Figures in thousands of euro

Balance sheetLoans to customers 2.254.634 1.908.585 18,1% 2.308.461Direct funding (*) 6.470.743 5.792.643 11,7% 5.625.997Net interbank position -3.723.862 -4.523.394 -17,7% -4.774.314 Financial assets held for trading 1.228.239 4.106.771 -70,1% 1.146.662Financial assets at fair value 3.264.454 - n.s. 3.235.021Available-for-sale financial assets 395.231 710.948 -44,4% 1.000.407Held-to-maturity financial assets 1.227.145 998.822 22,9% 1.061.634Shareholders’ equity (excluding profit) 3.665.977 3.553.369 3,2% 3.570.237

Income statementNet interest income -56.234 -30.184 86,3% -39.867 Dividend and similar income 507.628 340.056 49,3% 340.610Net commission income -5.115 -7.591 -32,6% -9.581 Net profit (loss) from trading, hedging and disposal/repurchase activities 77.849 58.372 33,4% 69.595Other net operating income / (expense) 218.322 216.033 1,1% 285.382Operating income 742.450 576.686 28,7% 646.139Staff costs -142.421 -125.764 13,2% -174.609 Other administrative expenses -101.798 -105.930 -3,9% -139.578 Net impairment losses on tangible and intangible assets -46.470 -37.016 25,5% -56.496 Operating costs -290.689 -268.710 8,2% -370.683 Net operating income 451.761 307.976 46,7% 275.456Net impairment losses on loans -118 -1.137 -89,6% -376 Net impairment losses on other assets/liabilities -31 -283 -89,0% -370 Net provisions for liabilities and charges 734 2.009 -63,5% 434Profit/loss on the disposal of equity investments 42.672 91.325 -53,3% 98.393Profit (loss) on continuing operations before tax 495.018 399.890 23,8% 373.537Taxation for the period 31.653 8.534 270,9% 17.820Profit for the period 526.671 408.424 29,0% 391.357

Other informationNumber of branches 2 2 - 2Number of employees 1.992 1.989 3 1.974

31.12.200530.9.2006 % change30.9.2005

(*) Including bonds subscribed by banks in the Group amounting to 131,1 million (131 million at 31st December

2005; 133,6 million at 30th September 2005).

As a result of higher dividends received during the period, net profit in the first nine months of 2006 reached almost 527 million euro, an improvement of 29% compared to 408 million earned in the same period of 2005. In detail, operating income increased from 576,7 million to 742,5 million and was composed as follows: - dividends of 507,6 million, compared to 340,1 million in the first nine months of 2005,

almost all from equity investments in subsidiaries and associates; - net interest income was negative by 56,2 million (-30,2 million in 2005) in relation to the

particular activity performed by BPU Banca, which is responsible, institutionally, for managing liquidity on behalf of the whole Group;

- net commission income was negative by 5,1 million (-7,6 million in 2005), in relation to the specific operational support functions performed by the Parent Bank with regard to network banks, for which BPU Banca incurs commission expenses which are then invoiced on the basis of specific intragroup contracts;

123

- net profit on trading and hedging activity was positive by 77,8 million, which includes non recurring income from the disposals of Banca Italease (58 million), SI Holding (2,2 million), CIM Italy Spa (2,8 million) and the interest in Meliorbanca (2,1 million) as well as the loss of 0,7 million on the sale of Esatri Spa. In the first nine months of 2005 it was 58,4 million and included the proceeds from the sale of securities amounting to 12,6 million and from the disposal of an initial tranche of Banca Italease amounting to 9,7 million;

- other net operating income of 218,3 million, of which 200 million from services provided to Group member companies (197 million in the first nine months of 2005).

Operating costs as a whole increased to 290,7million (+8,2%) reflecting both higher staff numbers, (+2% including the balance on inward and outward secondments and temporary agency staff) connected with the centralised performance of new activities at Group level, and also variable components of wages related to the results of the Bank. In detail staff costs rose to 142,4 million from 125,8 million in the first nine months of 2005 (+13,2%), while other administrative expenses fell to 101,8 million (-3,9%) partially offsetting growth in net impairment losses on tangible and intangible assets. As a result of the performance described above, net operating income increased by 47% to 451,8 million which, together with the 43 million of the item “profit (loss) on the disposal of equity investments”, relating almost entirely to the earn-out paid by Prudential USA on the investment in BPU Pramerica, produced a profit on continuing operations before tax of 495 million euro, an increase of 23,8% compared to approximately 400 million in 2005, which, moreover, included the profits on the disposal of an interest in BPCI of 59,8 million euro and on the disposal of ABF Leasing of 16,7 million, as well as the addition to the sale price of BPU Pramerica of 16,5 million. Taxation for BPU Banca was positive by 31,7 million, an increase compared to 2005, as a result of higher negative taxable income related to the increased percentage of dividends in profits, which benefit from reduced taxation. An examination of balance sheet items shows that funding at the end of September 2006 reached 6,5 billion euro (of which securities in issue amounted to 5,7 billion), compared to 5,6 billion at the end of 2005 (of which securities in issue amounted to 4,8 billion) and to 5,8 billion in September 2005 (of which securities in issue amounted to 4,7 billion). The evolution is mainly attributable to funding activity on international markets performed by BPU Banca through the EMTN programme, as described in the information given on consolidated funding, which may be consulted. Loans to customers – granted mainly to Group leasing companies – were virtually unchanged with respect to 2,3 billion at the end of 2005. Although it improved by more than 1 billion compared to December, the net interbank position of BPU Banca remained negative by 3,7 billion, reflecting the role it plays as the centralised manager of Group liquidity. Financial activities recorded the following performance in the first nine months of 2006: - financial assets held for trading increased to more than 1,2 billion, mainly as a result of

investments made by the Group asset management company, under the management mandate granted to it, and also as a result of new investments in government securities, which more than compensated for the decrease in investments in asset backed Securities (down from 576 million in 2005 to 138 million);

124

- financial assets at fair value16, consisting exclusively of capitalisation insurance certificates amounted 3,3 billion as the result of the subscription of 8 new contracts for a nominal value of 130 million and the early surrender of three policies for a nominal value of 175 million as well as the effects of capitalising interest settled and matured;

- available-for-sale financial assets fell by approximately 0,6 billion (from 1 billion to 395 million) in relation to the decrease by 540 million euro in debt securities (including the redemption in February of a 340 million bond issued in 2002 by Banca Intesa as part of the sale to Deutsche Bank Ag of the legal title only of 25,1262% of Banca Intesa);

- equities also fell by 62 million (from 157 million at the end of 2005 to 95 million) following the disposals already mentioned of equity investments in Banca Italease Spa, SI Holding Spa and Esatri Spa, and the interest held in Meliorbanca Spa and CIM Italy Spa only partially offset by an increase in the fair value of some equity investments.

- in terms of composition, 59% of available-for-sale assets at 30th September consisted of bonds, 24% consisted of equity investments and 17% of units held in O.I.C.R.s (collective investment instruments;

- held-to-maturity financial assets amounted to 1,2 billion in relation to the net effect of new investments in Government securities.

Capital ratios at 30th September 2006 (calculated according to IAS rules) consisted of a tier 1 ratio (core capital/risk weighted assets) of 28,78% and a total capital ratio (supervisory capital/risk weighted assets) of 44,80%.

16 As reported in the section “Financial activities”, the capitalisation policies, which were classified in the accounts as

at 30th September 2005 under “Financial assets held for trading”, have been recognised under “financial assets at fair value” in the accounts as at 30th September 2006 and 31st December 2005, in application of the fair value option.

125

BPU Banca: Individual company financial statements to 30th September 2006

126

BPU Banca: Balance sheet

Figures in thousands of euro30.9.2006 31.12.2005 30.9.2005

ASSETS

10. Cash and cash equivalents 52 39 37

20. Financial assets held for trading 1.228.239 1.146.662 4.106.771

30. Financial assets at fair value 3.264.454 3.235.021 -

40. Available-for-sale financial assets 395.231 1.000.407 710.948

50. Held-to-maturity financial assets 1.227.145 1.061.634 998.822

60. Loans to banks 11.161.743 10.856.799 10.186.981

70. Loans to customers 2.254.634 2.308.461 1.908.585

80. Hedging derivatives 7.835 24.905 34.184

90. Fair value change of hedged financial assets - - -

100. Equity investments 5.503.874 5.442.230 5.419.697

110. Tangible assets 653.960 664.523 651.787

120. Intangible assets 36.271 23.549 11.772

of which:

- goodwill - - -

130. Tax assets 217.760 275.996 220.634

a) current 122.640 192.058 103.909

b) deferred 95.120 83.938 116.725

140. Non current assets and disposal groups held for sale - 10 -

150. Other assets 137.973 793.677 703.141

26.089.171 26.833.913 24.953.359TOTAL ASSETS

127

Figures in thousands of euro30.9.2006 31.12.2005 30.9.2005

LIABILITIES AND SHAREHOLDERS’ EQUITY

10. Due to banks 14.885.605 15.631.113 14.710.375

20. Due to customers 807.318 841.149 1.130.320

30. Securities in issue 5.663.425 4.784.848 4.662.323

40. Financial liabilities held for trading 81.460 63.100 83.454

50. Financial liabilities at fair value - - -

60. Hedging derivatives 16.526 10.771 4.133

70. Fair value change in hedged financial liabilities (+/-) - - -

80. Tax liabilities 258.255 284.149 243.543

a) current 235.160 232.551 184.217

b) deferred 23.095 51.598 59.326

90. Liabilities associated with disposal groups held for sale - - -

100. Other liabilities 129.183 1.201.647 67.080

110. Staff severance payments 46.506 48.749 51.134

120. Provisions for liabilities and charges: 8.245 6.793 39.203

a) pension and similar obligations - - -

b) other provisions 8.245 6.793 39.203

130. Valuation reserves 52.600 100.415 89.335

140. Reimbursable shares - - -

150. Capital instruments - - -

160. Reserves 1.208.664 666.495 662.990

170. Issue premiums 1.543.578 1.943.203 1.941.442

180. Share capital 861.135 860.124 859.603

190. Own shares (-) - - -

200. Profit (loss) for the period (+/-) 526.671 391.357 408.424

26.089.171 26.833.913 24.953.359 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

128

BPU Banca: Income statement

Figures in thousands of euro30.9.2006 30.9.2005 2005 3rd Quarter

20063rd Quarter

2005

10. Interest and similar income 408.699 323.995 438.993 151.740 116.831

20. Interest expense and similar -464.933 -354.179 -478.860 -174.200 -124.717

30. NET INTEREST INCOME -56.234 -30.184 -39.867 -22.460 -7.886

40. Commission income 11.917 10.076 13.858 3.582 3.620

50. Commission expenses -17.032 -17.314 -23.086 -5.871 -5.598

60. NET COMMISSION INCOME -5.115 -7.238 -9.228 -2.289 -1.978

70. Dividend and similar income 507.628 340.056 340.610 23.564 6.955

80. Net profit (loss) from trading 11.408 35.328 46.256 6.962 7.818

90. Net profit (loss) from hedging activity -91 -84 -2.491 -66 -4.790

100. Net profit (loss) from sale or the repurchase of: 66.533 23.128 25.829 3.636 -1.423

a) loans - - -399 - -

b) available-for-sale financial assets 66.481 23.150 26.032 3.646 -1.351

c) held-to-maturity financial assets - - 12

d) financial liabilities 52 -22 196 -22 -73

110. Net profit (loss) on financial assets/liabilities held at fair value - - - - -

120. GROSS INCOME 524.129 361.006 361.109 9.347 -1.304

130. Net impairment losses on: -149 -1.421 -747 -80 -180

a) loans -118 -1.137 -376 -56 -86

b) available-for-sale financial assets - -9 -9 - -

c) held-to-maturity financial assets - - - - -

d) other financial transactions -31 -275 -362 24 -94

140. NET FINANCIAL OPERATING INCOME 523.980 359.585 360.362 9.267 -1.484

150. Administrative expenses -244.631 -230.157 -312.682 -79.005 -74.426

a) staff costs -142.421 -125.659 -174.504 -46.473 -39.535

b) other administrative expenses -102.210 -104.498 -138.178 -32.532 -34.891

160. Net provisions for liabilities and charges 734 5 -3.307 -675 1

170. Net impairment losses on tangible assets -31.412 -27.713 -37.207 -10.612 -9.819

180. Net impairment losses on intangible assets -14.919 -9.280 -19.211 -6.658 -3.011

190. Other operating income (expense) 218.594 216.125 287.189 71.802 75.621

200. OPERATING COSTS -71.634 -51.020 -85.218 -25.148 -11.634

210. Profits (losses) on equity investments 42.650 91.227 98.384 13.911 5.455

220. Net result of fair valuation of tangible and intangible assets- - - - -

230. Net impairment losses on goodwill - - - -

240. Profits (losses) on disposal of investments 22 98 9 12 97

250. PROFIT (LOSS) ON CONTINUING OPERATIONS BEFORE TAX 495.018 399.890 373.537 -1.958 -7.566

260. Taxes on income for the period for continuing operations 31.653 8.534 17.820 10.601 6.358

270. AFTER TAX PROFIT ON CONTINUING OPERATIONS 526.671 408.424 391.357 8.643 -1.208

280. Profit (loss) after tax on disposal groups held for sale - - - - -

290. PROFIT FOR THE PERIOD 526.671 408.424 391.357 8.643 -1.208

129

Figures in thousands of euro

ReservesDividends and other

uses

Changes in reserves

New share issues

Purchase of own shares

Extraordinary distribution of

dividends

Change in capital

instruments

Derivatives on own shares

Stock options

Share capital: 860.124 - 860.124 - - - 1.011 - - - - - - 861.135

a) ordinary shares 860.124 - 860.124 - - - 1.011 - - - - - - 861.135

b) other shares - - - - - - - - - - - - - -

Issue premiums 1.943.203 - 1.943.203 - - -402.629 3.004 - - - - - - 1.543.578

Reserves 666.495 20.106 686.601 118.136 840 402.629 - - - - - 458 - 1.208.664

a) of profits 847.018 - 847.018 118.136 840 - - - - - - - - 965.994

b) other -180.523 20.106 -160.417 - - 402.629 - - - - - 458 - 242.670

Valuation reserves: 100.415 -9.381 91.034 - - -38.434 - - - - - - - 52.600

a) available-for-sale financial assets 61.763 - 61.763 - - -38.232 - - - - - - - 23.531

b) cash flow hedging - - - - - - - - - - - - - -

c) exchange rate differences -243 - -243 - - - - - - - - - - -243

d) special revaluation laws 38.895 -9.381 29.514 - - -202 - - - - - - - 29.312

Capital instruments - - - - - - - - - - - - - -

Own shares: - - - - - - - - - - - - - -

a) of the parent bank - - - - - - - - - - - - - -

b) of subsidiaries - - - - - - - - - - - - - -

Profit for the period 391.357 - 391.357 -118.136 -273.221 - - - - - - - 526.671 526.671

Shareholders’ equity 3.961.594 10.725 3.972.319 - -272.381 -38.434 4.015 - - - - 458 526.671 4.192.648

Allocation of prior

year profit

BPU Banca: Statement of changes in shareholders’ equity at 30th September 2006

Changes January - September 2006

Shareholders’ equity at

30.9.2006Profit for the

period

Shareholders' equity operationsBalances at 31.12.2005

Changes in opening balances

Balances at 1.1.2006

See the section “The property revaluation” in the “notes and comments on consolidated operations” contained in another part of this report for information on the modification of the opening balances. More specifically BPU Banca increased its net reserves by 10,7 million as a result of an increase in other reserves of 20,1 million and of a decrease in reserves for valuation – special revaluation laws of 9,4 million.

130

Figures in thousands of euro

ReservesDividends and other

uses

Changes in reserves

New share issues

Purchase of own shares

Extraordinary distribution of

dividends

Change in capital

instruments

Derivatives on own shares

Stock options

Share capital: 856.128 - 856.128 - - - 3.475 - - - - - - 859.603

a) ordinary shares 856.128 - 856.128 - - - 3.475 - - - - - - 859.603

b) other shares - - - - - - - - - - - - - -

Issue premiums 1.929.506 - 1.929.506 - - - 11.936 - - - - - - 1.941.442

Reserves 977.848 -360.475 617.373 48.512 - 84 - - - - - 458 - 666.427

a) of profits 798.506 - 798.506 48.512 - 84 - - - - - - - 847.102

b) other 179.342 -360.475 -181.133 - - - - - - - - 458 - -180.675

Valuation reserves: 2.860 68.613 71.473 - - 36.596 - - - - - - - 108.069

a) available-for-sale financial assets - 32.022 32.022 - - 37.291 - - - - - - - 69.313

b) cash flow hedging - - - - - - - - - - - - - -

c) exchange rate differences - -243 -243 - - - - - - - - - - -243

d) special revaluation laws 2.860 36.834 39.694 - - -695 - - - - - - 38.999

Capital instruments - - - - - - - - - - - - - -

Own shares: - - - - - - - - - - - - - -

a) of the parent bank - - - - - - - - - - - - - -

b) of subsidiaries - - - - - - - - - - - - - -

Profit for the period 286.937 - 286.937 -48.512 -238.425 - - - - - - 408.424 408.424

Shareholders’ equity 4.053.279 -291.862 3.761.417 - -238.425 36.680 15.411 - - - - 458 408.424 3.983.965

Balances at 1.1.2005

Allocation of prior

year profitBalances at 31.12.2004

BPU Banca: Statement of changes in shareholders’ equity to 30th September 2005

Changes January - September 2005

Shareholders’ equity at

30.9.2005Profit for the

period

Shareholders' equity operationsChanges in opening balances

The column ‘changes in opening balances’ includes the effects of the adoption as at 1.1.2004 and 1.1.2005 of IAS/IFRS international accounting standards , as well as of the tax revaluation of properties in compliance with Law No. 266 of 23rd December 2005 (Finance Law for 2006). As a consequence the final value for shareholders’ equity at 30th September 2005 is different from the figure reported in the balance sheet by a total of 22.171 thousand euro.

131

Figures in thousands of euro 30.9.2006 30.9.2005

110.459 39.709

- net profit for the year (+/-) 526.671 408.424

- gains/losses on financial assets held for trading and on financial assets/liabilities held at fair value (+/-)

-8.980 -25.967

- gains/losses on hedging activities (-/+) 91 84

- net impairment losses on loans (+/-) 118 1.420

- net impairment losses on tangible and intangible fixed assets (+/-) 46.332 36.993

- net provisions for liabilities and charges and other expense/income (+/-) 1.452 -202

- outstanding taxes and duties 44.656 158.819

- net impairment losses on disposal groups held for sale after tax (-/+) -

- other adjustments (+/-) -499.881 -539.862

211.035 -221.422

- financial assets held for trading -72.597 -100.546

- financial assets at fair value -29.432 -

- available-for-sale financial assets 565.356 600.652

- lending to banks: repayable on demand - -

- lending to banks: other loans -305.961 -700.785

- loans to customers 53.669 -20.743

-277.615 603.099

- amounts due to banks repayable on demand - -

- amounts due to banks other payables -740.967 652.960

- due to customers -30.349 405.479

- securities in issue 882.006 66.001

- financial liabilities held for trading 18.360 31.894

- financial liabilities at fair value - -

- other liabilities -406.665 -553.235

43.879 421.386

514.509 663.041

- disposals of equity investments 249 316.035

- dividends received on equity investments 500.253 346.607

- disposals of held-to-maturity financial assets 13.896 -

- disposals of tangible assets 111 399

- disposals of intangible assets - -

- disposals of subsidiaries and lines of business - -

-289.806 -870.516

- purchases of equity investments -67.491 -35.979

- purchases of held-to-maturity financial assets -179.406 -801.209

- purchases of tangible assets -15.194 -29.600

- purchases of intangible assets -27.715 -3.728

- purchases of subsidiaries and lines of business - -

224.703 -207.475

- issues/purchases of own shares 3.812 3.475

- issues/purchases of capital instruments - -

- distribution of dividends and other means -272.381 -217.405

-268.569 -213.930

13 -19 NET LIQUIDITY GENERATED/ABSORBED DURING THE PERIOD

2. Liquidity absorbed by

Net liquidity generated/absorbed by investing activities

C. FINANCING ACTIVITIES

Net liquidity generated/absorbed by financing activities

3. Liquidity generated/absorbed by financial liabilities

Net liquidity generated/absorbed by operating activities

B. INVESTMENT ACTIVITIES

1. Liquidity generated by

BPU Banca: Statement of cash flows (indirect method)

A. OPERATING ACTIVITIES

1. Ordinary activities

2. Liquidity generated/absorbed by financial activities

Legend: (+) generated (-) absorbed

132

Balance sheet items 30.9.2006 30.9.2005

Cash and cash equivalents at beginning of period 39 56

Total liquidity generated/absorbed 13 -19

Cash and cash equivalents: effect of changes in exchange rates - -

Cash and cash equivalents at the end of the period 52 37

Reconciliation

133

CONTACTS All information on periodical reporting is available on the web site www.bpubanca.it. Investor Relations: Tel. 035-392217 email: investor.relations@bpubanca.it Registered shareholders’ office email: soci@bpubanca.it