Komunikāciju aģentūra/ Edelman Affiliate; LV CORPORATE COMMUNICATION

1. Bank Citadelecommunication campaign of restructuring and launch of the new brand Kaspars Cikmačs BoardMemberand COO, bankCitadele 19 May 2011

2. Agenda Anatomy of Parexbanka’s liquidity crunch Communication goals and tasks Brand development Decision to establish bank Citadele Launch of the new Brand Client communication Transfer process Results Communication team

3. Parex Past Autors: Gatis Šļūka, 2009

4. Anatomy of Parex banka’s liquidity crunch LPA enlarges share capital by LVL 140 million and issues a subordinated loan of LVL 50 million Bank’s administration moves to the new headquarters Parex banka turns to the Latvian State for financial support FCMC imposes restrictions on Parex banka Bank’s syndicated loans are restructured Brand development results and decision to remove the crown EC approves enlargement of share capital, improving bank’s capital adequacy to 11% Government takes over the bank; New Board elected The EBRD becomes shareholder of the bank EC approves takeover of Parex banka 10.2009. 14.09.2009. 03.09.2009. 11.05.2009. 22.05.2009. 23.03.2009. 05.12.2008. 11.11.2008. 25.11.2008. 01.12.2008. the global liquidity crunch Latvia turns to the international lenders Latvia receives international financial support State budget for 2009/2010 has been approved, foreseeing major reductions in expenses

5. Communicationgoals To preserve existing client base, increase their loyalty and to motivate clients to stay with the New Bank after the crisis, taking into account extensive competition in the market. To motivate the Bank’s employees to attain better business results and achieve impressive reduction in expenses by 40%, To change internal environment by increasing internal communication activities, To manage the Bank’s reputation, To inform all target audiences about the restructure process. Target audiences: Clients, potential clients, employees, shareholders and investors, Eurobond owners and holders of other financial instruments, syndicated lenders and financial institutions, opinion leaders and brand specialists in Latvia, media and general public.

6. New bank – new strategy Brand development To Sustain To Stabilise To Grow Objectives for the new brand: We started at home Attract new deposits Restore credibility Build value in the new bank By understanding what’s special about Parex… … and what should belong to the history. Involving: Council, Board, Management, Managers and customer service A path for the brand’s journey Inspiring and enabling individuals and businesses to develop economically and therefore improve society in Latvia and the Baltic region. = Inspiring and enabling individual enterprise Drop Crown + Font Excessive Connection to the past Creates distance/ exclusivity Keep Red Bold, visible, standout It’s largely unused by competitors It makes the transition more cost effective

7. Establishmentofbank Citadele LPA takes over from the EBRD subordinated loan for Citadele of EUR 11,2 million Payment for initial capital of the bank Citadele (LVL 4 milion) Increase of Citadele share capital by LVL 99 million Cabinet of Ministers approves Bank’s restructuring model The EBRD buys from LPA 25% + 1 share of bank Citadele and sells to LPA 11,8 million Parex banka’s shares FCMC decides to issue a banking licence for Citadele Cabinet of Ministers decides to establish bank Citadele 28.07.2010. 22.06.2010. 02.08.2010. 30.07.2010. 23.03.2010. 01.06.2010. 28.06.2010. Transfer of Parex banka’s assets and liabilities (business transfer) to bank Citadele 01.08.2010. Issues to solve: SWIFT, communication with clients and collaboration partners, approvals from more than 1000 organizations to receive Communication issues: Launch of the Brand and client communication campaign about the transfer in order to create a more positive background for new Bank's operations Communication challenge: FCMC issued a release with the name of the new Bank before the launch event

8. Launch of the New Brand

9. Client communication

10. Client communication

11. External Communication

12. Internal Communciations

13. Communication for Resolution Bank

14. Technical split in Latvia Data migration in information systems took 25 hours (31.07 14:00 – 1.08 15:00). ATMs, internet bank, payment cards were working without interruptions. Citadele web pages in 13 countries and internet bank were launched at 0:00 on 1 August. All client current accounts were moved from Parex banka to Citadele. Any further transactions with Parex banka are carried through accounts in Citadele.

15. Client reaction after the split Deposit volumes have increased during the first week of Citadele operations and the positive trend has remained. Number of internet bank visitors during split: At night until 6:00 – 289 visitors, Total on 1 August – 37% more than on average Sunday. Call centre received 30% more calls than usual. Number of internet bank and payment card transactions without significant changes.

16. Results The public was well informed about the restructuring of Parexbanka and establishment of bank Citadele: affirmed by the results of opinionpoll, showing that 88% of Latvia’s inhabitants have heard about establishment of bank Citadele and its brand. Especially good results were achieved in the groups with higher income; Publicity results: In July and August 2010 the 12 spokespersons of both bank Citadele and Parexbanka were among top 20 in the Latvian media. Although in June 2010 Parexbanka had the greatest number of publicity (1194), it had the largest amount of negative publications (91). In July and August 2010 share of voice peaked both for Parexbanka(35 and 33%) and bank Citadele (17% and 16%). In August both banks had the highest publicity efficiency index – 38.37% and 38.24% respectively. The positive and neutral publicity reached 98% and only 2% of publications were fairly negative. An increase in the Bank’s business was observed, including increase in corporate deposits, stabilisation of the client base. the Bank repaid EUR 17.3 million deposit to the Ministry of Finance prior to the set deadline as the Bank has succeeded to grow its deposit base by another LVL 48 million in August 2010; thus, the Bank’s liquidity indicators substantially exceed the requirements; Clients were well informed about the split process and received the split calmly as direct communication with the most crucial target audiences was ensured. Have you heard about bank Citadele? Haven’t heard Have heard Hard to say No answer Less than 150 Ls 151-250 Ls 251-400 Ls 401-600 Ls 601-800 Ls Above 801 Ls August September

17. Communicationteam PR agency: KomunikācijuAģentūra/Edelman Affiliate Brand developers and implementers: WolffOlins (UK) and Leo Burnett (Latvia) Banks Communication team:MaijaCelmiņa, RaimondsBricis, IndraZinkeviča, Arita Featherstone, MārtiņšPanke, Inga Saleniece Management team: Nils Melngailis, GuntisBeļavskis, ValtersĀbele, VladimirsIvanovs, KasparsCikmačs, TīnaKukka, Daniel Frumkin

18. Thank you! Video “Ekspertu vēlējumi Citadele”