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					  RELATIONS
      E
  BUDGET

      to
December 31, 2010




                    1
               Reports and
                Budget
    At December 31,
    2010




Banco di Brescia San Paolo Cab
Limited Company

Capital Euro 615,632,230.88

Tax code and registration number
Companies Register No Brescia 03480180177
Headquarters and Headquarters: Brescia, Corso Martiri della
Libertà n. 13
Part of the "Gruppo UBI Banca"

Member of the Interbank Fund for Deposit Protection Fund
and the National Guarantee
2
3
Index
 Our "Mission" ............................................. .................................................. .....                        5
Corporate Boards and General Manager ............................................. ...............................
6 Territorial structure of the UBI Banca Group ............................................ ............... 7
The rating ................................................ .................................................. ......................
8 Key figures and indicators .............................................. ........................................... 10
'Report ............................................... ............................................. 11
     The reference scenario .............................................. ............................................... 12 The
    activity of the Banco di Brescia in 2010 ......................................... ............................... 23
    The system of internal control ............................................. .......................................... 31
    Reclassified financial statements .............................................. .................................... 33
    The research and development ........................................... ............................................ 44
    Contracts with Group companies ............................................ ..................... 45                                  More
    information ................................................ ..................................................               ....... 46
    Significant events after the balance sheet ........................................ .......... 64 Outlook for the
    year .............................................. .............................. 64                     Proposals to the assembly
    .............................................. .................................................. . 65
 Financial Statements ................................................ .................................................. ...
66
     Balance ................................................ .................................................. ...... 67             Income
    ................................................ .................................................. ....... 68            Statement of
    Comprehensive Income .............................................. ............................ 69                        Statement of
    changes in shareholders' equity ............................................ ..................... 70 Statement of
    Cash Flows ................................................ ................................................. 72
    The Notes ............................................... .................................................. ... 73 Part A -
        Accounting Policies ............................................. .......................................... 74 A.1 -
                   General Part ............................................ .................................................. .. 74
         Section 1 Statement of Compliance with international accounting standards ............ 74
        Section 2 Basis of preparation ............................................ .................. 74                         Section 3
        Events after the balance sheet date .......................... 75                                        Section 4: Other issues
        .............................................. .......................................... 75 List of IAS / IFRS endorsed
        by the European .......................... 80
       A.2 - the major budget items ....................................... ........... 83 A.3 - Information on
     fair value .................................................. .......................... 104 Part B - Balance Sheet
                                     ........................................... ............. 106 Part C - Income Statement
                       ........................................... .................. 151 Part D - Comprehensive income
    ............................................. ............................... 170 Part E - Information on risks and
                                                                                                  hedging policies .................... 171
         Section 1 Credit Risk ............................................. ................................ 171 Section
        2 Market Risk ............................................. ................................ 195 Section 3
        Liquidity Risk ............................................. .............................. 226 Section 4
        Operational risk .............................................. ................................ 237
 Part F - Information on capital ............................................ .......................... 244 Part G
- Business Combinations or business enterprise ............. 249 Part H - Transactions with
related parties ........................................... ........................ 250                            Part I - Share-based
payments Equity-................... 254                              Part L - Segment ............................................
................................... 255                            Attached to the Financial Statements
............................................ ..................................... 256 Report of Independent Auditors
............................................. ........................... 282                            Statutory Auditor's Report
.............................................. ................................ 284




4
Our "Mission"




       We Alliance of BanksRich in history, united by a federal
        model, integrated and multifunctional, capable of
        enhancing the strength of the distribution and sales
        network to deliver the market's potential synergy.



       We strongly share in the economic and social life land
       where we work, with one distinguishing feature of interpret,
         serve and promote the development of local economies.



           We pursue the aim of promote progress and create
            value for all our stakeholders.




          We support the development of an economic and
        healthy business, We grow with our customers products
                      and services of excellence.



    (From "The Charter of Values" of the UBI Banca Group, approved January 29, 2008)



                                                                                       5
Company Officers and General Management

BOARD OF DIRECTORS

President                       Gino Trombi (*)

Vice President                  Pierfrancesco Rampinelli Rota (*)
                                Constantine Vitali (*)

Counselor Secretary             Franco Bossoni (*)

Councillors                     Francesco Bettoni, Giuseppe Camadini, Gaudenzio Cattaneo
                                (*), Giorgio Franceschi, Stefano Gianotti, Andrea Gibellini
                                Pierangelo Gramignola, Victor Massiah, Giambattista
                                Montini, Francesco Passerini Glazel, Flavio Pizzini (*), Franco
                                Polotti (*), Gianfederico Soncini.



(*)     Executive Committee members




AUDITORS

President                       Paolo Golia

Standing Auditors               Eugenio Ballerio, Alessandro Masetti Zannini

Alternate Auditors              First Cancarini, Guido Piccinelli

DIRECTORATE
GENERAL

General Manager                 Elvio Sonnino

Deputy General                  Paola Montresor, Stefano Vittorio Kuhn




AUDITORS

Ernst & Young S.p.A.




6
Territorial structure of the UBI Banca Group




                                               7
   The rating
   The following tables summarize the opinions of ratings assigned by international agencies to
   Group Standard & Poor's, Fitch Ratings, Moody's.

   On April 23, 2010 Standard & Poor'sAs part of a general analysis of Italian banks,
   confirmed the counterparty rating in the short and long term UBI Bank, revising its outlook
   from stable to negative in relation to a perceived lower Group's ability to absorb the cost of
   credit higher than expected if the fragile recovery process had difficulties to consolidate.

   On December 17, 2010 FitchRatings reduced the long-term counterparty rating to UBI
   Banca to A from A + with stable outlook, confirming all the other ratings.
   The surgery was performed in view of slower economic activity in Italy, and the continued
   low level of market interest rates, which in the opinion of the Company's credit rating,
   makes it unlikely that a rapid recovery in profitability of UBI Banca.
   At the same time, Fitch has stressed: the importance of the Group's distribution network,
   located in the richest regions of the country, the perception of sound management and
   credit risk, which enabled the credit quality to deteriorate to a lesser extent than its
   competitors; adequate capitalization conservative approach in relation to risk and adequate
   liquidity, with well-diversified funding sources.




                                                                                     (I) Ability to repay debt maturing in less than 1 year (A-1: best
         STANDARD & POOR'S                                                                rating - D: worst rating)
         Short-term Counterparty Credit Rating (s)                 A-1               (Ii) With reference to debt for a period exceeding one year, means
         Long-Term Counterparty Credit Rating (ii)                  A                       the capacity to pay interest and repay principal, together
                                                                                            with a sensitivity to the adverse effects of any change in
         Outlook                                                Negative
                                                                                            circumstances or to changes in economic conditions
                                                                                            (AAA: best rating - D: worst rating)




                                                                                    (I) Ability to repay the debt in local currency long-term (maturity
                                                                                          less than one year). Through the methodology JDA (Joint
          MOODY'S
                                                                                          Default Analysis) combines the financial strength rating this
          Long-term debt and deposit ratings (I)                    A1                    intrinsic (Bank Financial Strength Rating) assessment about
          Short-term debt and deposit ratings (II)               Prime-1                  the likelihood of intervention, if necessary, by external
                                                                                          support (shareholder, group or official institutions ) (Aaa: first
          Bank Financial Strength Rating (BFSR) (III)                C                    quality - Baa3 quality)
          Baseline Credit Assessment (BCA) (IV)                     A3
          Outlook (deposit ratings)                               Stable           (II) Ability to repay the debt in local currency short-term (maturity
                                                                                          of less than 1 year)
          Outlook (Bank Financial Strength Rating)               Negative
                                                                                           (Top-1: top quality - Not Prime: speculative grade)



(III) This rating does not relate to the ability to repay debt, but takes into account the bank's intrinsic financial strength (thr ough the
        analysis of factors such as geographical locations, the diversification, the financial fundamentals), in the absence of media
        external (A: best rating - E: worst rating)

(IV) The Baseline Credit Assessment is the equivalent of the Bank Financial Strength Rating on the scale of the traditional long-term
       rating.




   8
                                                                                      (1) capacity to repay debt in the short term (lasting less than 13
        FITCH RATINGS
                                                                                          months) (F1: best rating - D: worst rating)
        Short-term Issuer Default Rating (1)                       F1
                                                                                      (2) Ability to meet financial commitments over the long term
        Long-term Issuer Default Rating (2)                         A                     regardless of the maturity of individual bonds. This rating is
        Bank Individual Rating (3)                               B/C                      an indicator of the likelihood of issuer default (AAA: best
                                                                                          rating - D: worst rating)
        Support Rating (4)                                           2
                                                                                      (3) Evaluation of a bank's intrinsic strength (profitability,
        Support Rating Floor (5)                                  BBB
                                                                                          balance the budget, the commercial network, capacity
        Outlook for Long-term Issuer Default Rating              Stable                   management, operating environment and prospects), having
                                                                                         assumption that the same can not rely on
    external support (if any intervention of a lender of last resort support of shareholders, etc..) (A: best rating -
    E: worst rating)
(4) Judgement on any chance, adequacy and timeliness of external intervention (by the state or large institutional reference) if the
      bank was in difficulty (1: best rating - 5: worst rating)
(5) This rating gives additional information, which is closely related to the support rating, as it identifies, for each level of the Support
      rating, the minimum level that, in the event of




                                                                                                                                                           9
Key figures and indicators
(In millions of euro)

  BANCO DI BRESCIA S.p.A.                                                                  31/12/2010        31/12/2009

BALANCE SHEET, FINANCIAL, AND OPERATIONAL STRUCTURE

Loans to customers                                                                               15.078             14.179

which deteriorated                                                                                  746               532
Direct customer                                                                                  12.119             19.171

Direct customer deposits (restated) (**)                                                         12.119             13.542

Indirect customer deposits, including savings insurance (market value)                           20.895             20.866

Total financial wealth                                                                            33.014            40.037

Total financial wealth (restated) (**)                                                            33.014            34.408
Shareholders' equity (excluding profit for the year)                                              1.388              1.158

Profit from continuing operations before taxes                                                      119                202

Profit for the year                                                                                     72             129

Actual Number of Employees                                                                        2.634              2.623

Number of branches operating                                                                        362                363

INDEX STRUCTURE

Customer loans / customer deposits                                                              124.42%             73.96%
Customer loans / customer deposits (restated) (**)                                              124.42%            104.70%

Assets under management (including insurance) / indirect funding from ordinary customers         49.51%             47.56%

PROFITABILITY RATIOS ', efficiency and productivity'

ROE (Net income / Shareholders' equity excluding net income)                                      5.19%             11.14%
ROE excluding non-recurring items                                                                 5.39%             10.69%

COST / INCOME 1 (operating expenses / operating income)                                          59.14%             53.00%

COST / INCOME a net non-recurring items                                                          58.42%             53.00%

COST / INCOME 2 (Operating costs + value adjustments on receivables / operating income)          77.38%             64.81%

COST / INCOME 2 excluding non-recurring items                                                    76.66%             64.81%

Tax rate                                                                                         39.48%             35.66%

Tax rate normalized                                                                              39.10%             38.58%

Net interest income / operating income                                                           60.74%             60.27%

Net commission income / operating income                                                         36.54%             34.16%

Net commission income / expense, net of the staff of non-recurring                              116.00%            121.71%

Net adjustments to loans / credits to customers                                                   0.65%              0.49%

RISK RATIOS '

Non-performing loans / Loans to customers                                                         1.23%              0.93%
Loans / Loans to customers                                                                        4.95%              3.75%

% Coverage suffering                                                                             46.69%             50.75%

% Total non-performing loans coverage                                                            21.90%             24.83%

% Coverage of performing loans                                                                    0.47%              0.37%

CAPITAL RATIOS (*)

Capital / risk weighted assets                                                                   12.82%             14.04%
Capital / risk weighted assets                                                                   13.28%             15.23%



(*) The risk-weighted assets for the determination of the coefficients shown include the discount of 25% expected for
banks belonging to a banking group on a consolidated basis to comply with the mandatory minimum requirement.
(**) The figures have been restated net of the Luxembourg branch, given in UBI International SA effective December
10, 2010.

The indicators have been reclassified using data reported in the "Balance Sheet and Income Statement."

It should be noted that data for comparative periods are not homogeneous as a result of the optimization Place, as
detailed in the section "Other Information - Talks on the articulation of the territorial group.

10
Report on
  Management




               11
The reference scenario
In 2010, the severe recession followed the financial crisis triggered by subprime mortgages,
has given way to a global economic recovery, despite a series of assumptions that seem to
affect the return to a normal situation: the reduction of leverage, the volatility of exchange
rates and its effects on the evolution of global imbalances, high levels of unemployment and
public debt and, by autumn, a rise in inflation even in advanced economies.
The tensions unleashed by the crisis in the spring of the greek government debt - the
consequences of which were then gradually extended to other euro area countries with high
debt (Ireland, Portugal and Spain) - have also contributed to weakening an already affected
by the shooting weakness of domestic demand.
The heightening of tensions in financial markets in the year, sparked by the serious
difficulties of the Irish banking system and uncertainty about the new European regulatory
crisis1Has resulted in a steady rise in government bond yields in the long term. In parallel
also the risk of major international banks has again increased with the enlargement of the
premiums on credit default swaps (CDS) after the downsizing that followed was the highest
recorded in the spring, coinciding with the crisis in Greece, incorporating the increased
perception of risk on sovereign debt.
On November 21, Ireland made a formal request for loan to the European Union and the
International Monetary Fund, which was granted on November 28 preparing a support plan
for a total of 85 billion euro, of which 45 billion provided by EU / EMU through programs
EFSF / EFSM and bilateral loans from the UK, Sweden and
Denmark 22.5 billion by the IMF and the remaining 17.5 billion from the same Irish
Government
(Liquid funds of the Treasury and Investment Fund National Pension Reserve).

In order to prevent the recurrence of further financial crises during the year were taken
important steps. In particular:
      ·   in May, after the adoption of a three-year bilateral loan to Greece for € 80 billion (in
          addition to 30 billion given by the IMF), the European Union and the Member States
          of the euro area have defined two agreements financial stability: one was created
          European Financial Stabilisation Mechanism
          (EFSM) to enable the European Commission to raise up to € 60 billion, guaranteed
          by the EU budget, for lending to countries in the EU who are in exceptional
          circumstances outside their control, the other a three-year plan was launched, in
          partnership with the IMF, to ensure the needs of the euro area countries with high
          levels of debt. 440 billion will be made available through the European Financial
          Stability Facility (EFSF) 2, special purpose vehicle set up on June 7 for the market
          borrowing by issuing securities backed by
          Countries of3;
      ·   both the U.S. and Europe have been approved reforms regarding the regulation and
          supervision of the financial system. In the U.S. were
          attributed to the Federal Reserve more power over major financial groups, by setting
          up a Council for financial stability, consisting of


1   Yield spreads on government bonds of ten-year Greece, Ireland, Spain and Portugal than in Germany, marked a
    sharp rise while a more modest increase has occurred in Italy and Belgium.
2   The IMF will provide € 250 billion which, added to 60 and 440 provided dall'EFSM dall'EFSF that would be
    collected, will reach the planned total budget amounting to 750 billion euro.
3   The rules governing the operation of this company state that the vehicle must be maintained between the ratio of
    120% guarantees and securities issued to finance the requesting country. It is also expected that the ratio of
    loans and securities issued is equal to about two thirds, with the remainder to invest in a reserve liquid. There
    are also ongoing evaluations of the adequacy of the program to ensure the management of a crisis extended to
    more countries and could soon lead to extend the amount of collateral that secure the limit fund-raising and
    lending.
    In the month of January 2011 was placed on the market dall'EFSF the first title of a five-year European debt
    guaranteed by member states of the Eurozone and is intended to fully fund the Irish at a lower rate than that
    this nation should pay if their emissions.

12
            regulatory authorities, including the Fed itself, called to oversee the so-called
            systemic risk. In Europe, however, from 1 January 2011 is operating a system of
            financial supervisory authorities (European System of Financial Supervision, ESFS)
            in turn divided into a Supervisory Committee of systemic risk (European Systemic
            Risk Board - ESRB), with functions macro-prudential supervision, and three new
            Authority4 called to work together with 27
            National authorities of individual EU countries with the task of micro-prudential
            supervision;
       · at the end of November, the finance ministers of the euro have established the main
            features of a permanent mechanism to safeguard the financial stability of the
            (European Stability Mechanism, ESM), this body, which would replace the European
            Financial Stability Facility (EFSF) since June 2013, provides financial support to
            countries that request assistance under strict conditions similar to those currently
            provided dall'EFSF, thanks to an initial budget of € 500 billion subject to revision
            later on at least two years;
       ·    has also continued discussions on the strengthening of the Stability Pact by
            introducing monetary penalties applicable before the
            Excessive deficit procedure, which could also be initiated if it is not satisfactory to
            the decrease in the debt of a country towards the 60% of GDP. It was also the
            possibility of combining the monitoring of the debt / deficits for a procedure enabling
            the rapid identification of macroeconomic imbalances could be relevant to the
            financial stability of the area through the use of some quantitative indicators to be
            defined such as the rate savings, private debt, the balance of trade, flows of
            investment income and transfers;
       ·    in late December, the Basel Committee on Banking Supervision published the final
            documents on the new banking regulation (Basel 3). The new system of rules provide
            a greater amount of capital and of better quality, better coverage of risk, the
            introduction of a ceiling on the lever to complement capital requirements "risk-
            based" measures to promote capital accumulation in good times and the
            introduction of two of the credit liquidity requirements. The new rules will be
            implemented by all member states with national laws and regulations and will take
            effect gradually over six years, from 1 January 2013.

Aggregate debt and its components (% of GDP) in major European countries

                                                                                                                     (1)
                                                           Aggregate debt                           Private sector                              Public Sector

                                                2007           2008          2009         2007            2008             2009     2007            2008         2009
Percentage

    Italy                                      218,2          226,7         241,3        114,6           120,4         125,3       103,6           106,3        116,0
    Germany                                    196,7          197,8         207,9        131,8           131,5         134,5        64,9            66,3         73,4
    France                                     210,3          221,5         240,5        146,5           154,0         162,4        63,8            67,5         78,1
    Portugal                                   291,6          309,8         336,3        228,9           244,5         260,2        62,7            65,3         76,1
    Ireland                                    236,8          319,3         397,1        211,8           275,0         331,6        25,0            44,3         65,5
    Greece                                     212,2          229,4         250,3        107,2           119,1         123,5       105,0           110,3        126,8
    Spain                                      250,0          259,9         279,2        213,9           220,1         226,0        36,1            39,8         53,2
    United Kingdom                             253,1          274,0         293,1        208,6           221,9         224,9        44,5            52,1         68,2
     Source: Eurostat
(1) For the private sector (households, non-profit institutions, non-financial) data have been used have not been settled. The concept of private sector
     debt includes loans and securities, excluding treasury shares.



On the subject of monetary policyThe year was marked by conflicting attitudes among the
advanced economies and those in developing countries. In the first case the central banks
have maintained an expansionary stance - with rates at historic lows - to support the fragile
recovery in place in a context of inflation risks



4   One for the banking sector (European Banking Authority - EBA), one for financial markets (European Markets
    and Securities Authority - ESMA) and one for insurance and pensions (European Insurance and Occupational
    Pensions Authority - EIOPA).

                                                                                                                                                                        13
remained very low for most of the year5. The rapid price increase last quarter in the coming months
could lead to a change of this approach. On the other hand, the monetary authorities of the major
emerging countries are already in place stringent measures to curb price pressures arising from the
large amount of cash put on the market during the crisis6.
On foreign exchange market there has been a generalized loss of value of the euro in
                       t
                      h
against of all e    main                            Main exchange rates and oil prices (Brent) at end of period
international currencies - with a
partial     recovery     in      first                     Dec-10     Sep-10       Jun-10       Mar-10     Dec-09   Change%

months of 2011 - which                                       A           B            C           D           E        A/E

Consequently     of         repeated    EUR / USD             1,3377    1,3630       1,2234      1,3510      1,4316     -6.6%
tensions produced by the crisis                              € / Yen                                      108,60   113,75   108,15          126,27   133,08    -18.4%
                                                             € / Yuan
debts   sovereign.
                                                                                                          8,8148   9,1192   8,2972          9,2230   9,7726        -9.8%
                                                     As      EUR / CHF CH                                 1,2486   1,3387   1,3177          1,4236   1,4823    -15.8%
shown in graph 1, the                                        Euro / sterling                              0,8572   0,8675   0,8183          0,8898   0,8860        -3.3%
currency single after                               have     Dollar / Yen                                  81,15    83,45    88,39           93,46    92,90    -12.6%

reached            to start                    June a        Dollar / Yuan                                6,5900   6,6905   6,7815          6,8258   6,8259        -3.5%
                                                             Futures - Brent (in $)                        94,75    82,31    75,01           82,70    77,93        21.6%
                   minimu
point              m              under            share
1.20 against the
                                                                        Changes in the euro-dollar and dollar-yen (2009-2010)
dollar, has partly                                                                                                                                   Chart No. 1
recovered in the third                      1,58                                                                                                                       102



quarter but then suffer                     1,54                                                                                                                       100

in November of the
new difficulties. More                      1,50                                                                                                                       98


uniform appeared                            1,46                                                                                                                       96

instead that the trend
of the yen between                          1,42                                                                                                                       94


March and November
has progressively
                                            1,38                                                                                                                       92




revalued against the                        1,34                                                                                                                       90


U.S. dollar share to
nearly 80 yen per                           1,30                                                                                                                       88



dollar. Despite                             1,26                                                                                                                       86




                                            1,22                                                                                                                       84




                                            1,18                                                                                                                       82




                                            1,14                                                                                                                       80

                                                                            GFMAMGL   ASONDGFMAMGLASOND


                                                                             2009                                                    2010




5   In early November, the Federal Reserve has launched a new program that provides for the purchase of long-term bonds totaling $
    600 billion to be completed by mid-2011. The program dovetails with the reinvestment, still in government bonds, the proceeds of
    redemptions of securities of government agencies and mortgage backed securities, to about 250-300 billion over the same period.
    The Bank of Japan decreased marginally in October, the reference rate, now between 0 and 0.10% and announced an expansion
    plan that also includes quantitative equity funds and the purchase of real estate
    (For a total of 500 billion yen).
     The Governing Council of ECB decided to continue to lead the main refinancing operations and those with a maturity equal to
    the reserve maintenance period through fixed rate tenders with full acceptance of the application until it is necessary and in any
    case, at least until July 12, 2011 . He also established that the operations carried out three months before this date will be
    conducted with full allotment of inquiries and with the same rate as average main refinancing operations over the duration of the
    operation.
6   Since March 2010, the RBI increased to six times a year and once in January 2011 the reference rate, now at 6.5%.
    The People's Bank of China has repeatedly intervened in the ratio of reserve requirements (six times in 2010 and twice in
    January and February 2011) raised the all-time high of 19.5%, while three have been increases in the rate on bank loans (up 25
    basis points respectively October and December 2010 and February 2011), now at 6.06%.
    The Brazilian Central Bank worked three increases in 2010 and two in January and March 2011, bringing to 11 the reference
    rate, 75%.
    The Russian Central Bank, that, given the fragility of the recovery after the sharp fall of 2009 in the first half of 2010 had
    operated four reductions in late February has increased by 25 basis points benchmark rate, currently 8%.


14
the intervention of the Central Bank of China, which in June had restored a managed float regime
against a basket of reference currencies, the desired revaluation of the yuan against the dollar was
rather quite small.


The macroeconomic framework
According to the IMF's GDP in the year just ended WorldWhile decelerating in the second
semester,            would return
increase by 5% (-0.6%                           Changes in the price of Brent oil (2009-2010)                                             Graph 2

in       2009)        highlighting                 100


However, marked differences
between                                             95


Count
ries    andareas       geography.                   90


If by a       side i         main                   85


Count
ries        emerging             in                 80


particular       those       Asian                  75


have      accelerated      rhythm
                                                    70




of development          increasing
                                                    65


                                                    60

same                    the their                   55

weight to level             global                  50

             th
other        e recovery in                          45


economies         advanced is                       40


appeared    more modest and                         35


sometimes                inhomogeneous                                                                      GFMAMGLASONDGFMAM   GLASOND

                                                                            2009                                                2010
as       in      case         area
€.
The scenario was characterized by high unemployment and a gradual recovery of inflation due to the
general rise in prices of raw food and energy, mainly due to increased demand in the face of relative
inelasticity of supply, particularly in the case of food.
As shown in Chart 2, after a long fluctuated in the range between 70 and 80 dollars per barrel, the
price of Brent oil ended the year in the continuing rising trend in January and February when prices
reach their exceed $ 110 a barrel, propelled by geopolitical tensions in North Africa.

After the slowdown in the spring months, 'sU.S. economy showed a gradual acceleration in the fourth
quarter economic growth of GDP was 2.8% annualized (+2.6% in the third quarter), supported
primarily by consumption, particularly of durable goods, but also by a again positive contribution of
net exports is determined largely by the decrease in imports, and the contribution of fixed investment,
under which the residential component continues to show weak, was more modest. Overall, the
average annual U.S. GDP has been growing again (+2.8%) after the fall of 2009 (-2.6%).
The main element of weakness is now represented by the rate of unemployment (9.4% in December),
slightly down from the peaks registered during the year (9.8% in April and November), but twenty
months set above 9%. The improvement in place seems to be confirmed in January 2011 (9%). The
average figure of 2010, equal to 9.6% was the highest since 1984.
After the peak of the end of 2009 (+2.7%), inflation has rapidly reduced remaining slightly above 1%
between June and November, ending the year at 1, 5%. Inflation "core" (excluding food and energy)
has remained stable from April to below 1%
(0.8% in December).
The "twin deficits" have continued to show opposite trends, but with roles reversed from the previous
year: the federal deficit has in fact reduced to 1.277 billion dollars, from 1.4713 trillion in 2009 (-
13.2%)7 while the negative balance of trade balance has returned to grow to U.S. $ 497.8 billion
(+32.8%), reflecting mainly an increased deficit to China and OPEC countries.


7   In order to consolidate the recovery, the U.S. government launched in December, a new fiscal stimulus program for about $ 800
    billion (5.5% of GDP), to be implemented over the period 2011-12.


                                                                                                                                                    15
Actual results and forecasts: industrial countries

                                                                           Consumer prices                                       Unemployment                                  Public Sector Deficit (%
                            Gross Domestic Product                                                                                                                                                                                       Reference rates
                                                                              (Annual average)                                       (Annual average)                                   of GDP)
                                                           (1)                                            (1)                                                     (1)                                        (1)            (1)
Percentage                  2009     2010           2011           2009           2010             2011                2009              2010             2011                2009              2010                 2011          Dec-09          Dec-10

  United States             -2,6       2,8            2,1          -0,4              1,6               2,0              9,3                 9,6              9,4              11,3                      10,3          12,1          0-0,25         0-0,25
  Japan                     -6,3       3,9            1,3          -1,4             -0,7               0,2              5,2                 5,1              5,2               8,7                      10,6           9,0            0,10         0-0,10
  Euro Area                 -4,1       1,7            1,5           0,3              1,6               2,2              9,4                10,0             10,0               6,3                       6,2           4,8            1,00          1,00
  Italy                     -5,2       1,3            1,1           0,8               1,6              2,2              7,8                   8,5               9,2                5,4                   4,6            3,9                    -               -
  Germany                   -4,7       3,6            2,2           0,2               1,2              2,1              7,5                   6,9               6,6                3,0                   3,6            2,6                    -               -
  France                    -2,6       1,6            1,6           0,1               1,7              2,1              9,5                   9,8               9,7                7,5                   7,7            6,5                    -               -
  Portugal                  -2,5       1,3           -1,0          -0,9               1,4              1,8              9,6                 10,9            11,0                   9,3                   -7,0          -5,3                    -               -
  Ireland                   -7,6      -0,2            0,9          -1,7             -1,6               0,8             11,9                 13,5            14,0              14,4                      32,3          10,5                     -               -
  Greece                    -2,0      -4,2           -3,0           1,3               4,7              3,0              9,5                 13,8            13,6              15,4                       9,3            7,6                    -               -
  Spain                     -3,7      -0,2            0,7          -0,2               2,0              3,0             18,0                 20,1            20,7              11,1                       8,9            7,6                    -               -
  United
  Kingdom                   -4,9       1,3            2,2           2,2               3,3              3,6              7,6                  7,8                7,6           11,4                      10,1            7,8           0,50          0,50

(1) Weather                                                                                                                                                                                                        Source: Official statistics and Prometeia



In Japan shooting, became less intense in the spring, seems to have stopped.
In the last fifteen years the GDP has in fact reduced by 0.3% over the previous period after
+0.8% in third quarter (+1.5% and +0.5% respectively in the first and second quarter). This
trend synthesizes a sharp slowdown in consumption, the persistent weakness of investment
and a weakening of trade, also affected by the strengthening yen. The economic picture is
also in line with the expectations of the Tankan report in December that showed a
worsening climate of business confidence for the first time in six quarters. Some positive
signs seems to come from industrial production, up from November on a short-term (up
3.3% in December) after five consecutive declines, and the labor market where the
unemployment rate in December fell below 5% the first time in nine months (5.3% peak
reached in June).
Japan has not yet emerged from deflation in place since February 2009 to December, the
general index of consumer prices was zero, while the "core", ignoring food, continued to
remain negative (-0.4% ).

In 2010, the China has further accelerated its pace of development with an average increase
in GDP of 10.3% (+9.2% in 2009) is projecting that the world toward the second position
ahead of Japan. The dynamic contribution has been supported by all components, in
particular by domestic demand: 23.8% for fixed capital formation, albeit at a slower rate
than in 2009, +18.4% for sales of consumer goods;
+15.7% For industrial production, driven by heavy industry.
The positive balance of trade balance has been reduced to U.S. $ 183.1 billion (-6.4%
compared to 2009) under a stronger growth in imports (+38.7%) than exports (+31.3 %).
Foreign exchange reserves have touched on the 2,600 billion dollars (+7.6%), of which a
significant proportion (about 1.16 trillion) permanently invested in U.S. government bonds.
In parallel with the acceleration of the inflation rate also has been reported at high levels
(4.6% in December, 4.9% in January 2011) reflecting increases in food and real estate.

              Actual and forecast: key emerging
                                                                                                   Consumer prices                                              Unemployment
                                             Gross Domestic Product                                                                                                                                                       Reference rates
                                                                                                                                                                         (Annual
                                                                                                       (Annual average)                                                 average)
                                                                              (1)                                                        (1)                                                             (1)
              Percentage                 2009              2010     2011                    2009             2010             2011                      2009            2010             2011                       Dec-09          Dec-10
                China                        9,2            10,3            8,5              -0,7                3,3                 2,7                 4,3               4,1                         4,0            5,31              5,81
                India                        5,7             9,5            7,3             10,9                13,2                 6,7                 n.a.              n.a.                        n.a.           4,75              6,25
                Brazil                       -0,6            7,5            4,5                  4,9             5,0                 4,6                 8,1               6,7                         7,5            8,75            10,75
                Russia                       -7,9            3,7            4,5             11,7                 6,6                 7,4                 8,4               7,5                         7,3            8,75              7,75

              (1) Weather                                                                                                                                                   Source: Prometeia, IMF and official statistics




Also for the other main Emerging countries it shows a return to high growth rates after the
slowdown of 2009.



16
In the third quarter's GDP 'India increased by 10.6% in terms of trend as a reflection of a
significant acceleration in domestic demand and consumption (+9.3%) and investments
(+12.4%), and an improvement in external demand which contribution, however, continues
to remain marginal. A favorable environment have benefited the industrial sector (+9.5%
average increase year on year industrial production between April and November) and that
of services. Despite a moderation between August and November, Indian inflation continues
to confirm the highest in Asia.
The Russia has recovered ground after the heavy fall of 2009, benefiting from the gradual
recovery of the global economy and the consequent revival of exports (especially oil) and
industrial production. In the third quarter, however, have recorded signs of slowing, with
GDP growing by only 2.7% on an annual basis, a summary of an acceleration in consumer
spending and a deceleration of investment, but also a significant increase in imports
compared to a more dynamic small to export. Reflecting the increase in international prices,
inflation rose to 8, 8% in December.
In Brazil the economy was driven by industrial production (+10.5% average annual)
positively affected revenue tied to commodity prices, they remained high, and huge flows of
foreign capital, attracted by favorable conditions of returns in an environment of
macroeconomic stability. Capital flows incoming parties have contributed to fuel the
inflation in December reached 5.9%, well above the target identified by the Brazilian
authorities.

To 'seuro area 2010 was overall a year of recovery, albeit at different rates across countries
and Monetary Union as a deceleration in the second half. In both the third and fourth
quarter because the GDP has increased by only 0.3% over the preceding period (+1% in
spring), mainly reflecting the gradual slowdown in the German economy that has been
confirmed, however, the most dynamic.
Overall average annual GDP increased by 1, 7% (-4.1% in 2009) even though sustained by
the positive net exports in mitigation, sensitive to changes in the global economy, while
consumption and the investment contribution has been modest.
The industrial production index for March showed changes on an annual basis in excess of
5% (+8% in December) but in the short-term trend is not yet well defined (-0.1% in
December).
Unemployment has remained at high levels (10% at the end of 2010, 9.9% in late 2009) with
Spain from May stably above 20%.
Inflation has gradually increased: the Harmonised Index of Consumer Prices
Consumption in December had increased to 2.2% from 0.9% a year earlier (1.6% above the
average of the year compared to 0.3% in 2009). The adjusted index of food and energy
components, as well as alcohol and tobacco, but has not shown significant changes (1.1% in
December).
From 1 January 2011, with the entry of Estonia, have risen to 17 countries participating in
monetary union. It joined the European Union on 1 May 2004, Estonia has met all the
parameters (public debt, budget deficit, interest rates and inflation) required for admission.

In line with international developments in Italy the weak recovery lost momentum in the
second half. Between September and December, the cyclical increase in GDP was only 0.1%
(+0.3% and +0.5% respectively in the third and second quarter), reflecting the lower
contribution of net exports, partly due to an increase in imports, compared to continued
weakness in consumption and investment.
Average annual GDP is, however, rose 1, 3% after the significant decline in
2009 (-5.2%), powered by restocking and recovery of private consumption and gross capital
formation in the face of an intake remained negative, although improving, foreign trade.
Turned positive in February - with changes in trends over 7% between March and June and
a peak of 9.7% in August - industrial production (adjusted for calendar effects)
subsequently lost momentum by recording an increase in December


                                                                                                 17
5.4% (+5.3%, the average change in the year after two consecutive years of reduction).
In terms of sectors have shown more vitality segments of the "Refining" (+15.6%),
"Manufacture of machinery and equipment '(+13.3%) and" Metal "(+12.2%), while a
contribution negative has come from areas of the manufacturing computer "(-13.1%),"
Pharmaceutical "(-7.4%)," Extract "(-3.6%)," Manufacture electrical equipment "(-2.8 %) and
"Food" (-2.5%).
The most recent estimates in December confirmed the unemployment rate to 8, 6% (more
than 2.1 million people), still close to the maximum reached in October
(8.7%), but still below the European average (10%) thanks to the use of social welfare: in
2010 were granted a total of 1.2 billion hours of Wage Supplementation Fund (CIG), an
increase 31.7% compared to 914 million in 2009. In recent months the trend, which is
already weakening, appears to have reversed with four consecutive short-term declines in
December were also interested in the extraordinary and notwithstanding8.
In terms of prices, Italy has suffered from the gradual recovery of inflation albeit slightly
smaller than the euro area. In December, the Harmonised Index of Consumer Prices had in
fact led to 2.1% (2.2% in the European figure) from 1, 1% at end 2009 (0.9%). Average
annual inflation was at 1, 6% (0.8% in 2009), in line with the European level.
The Italian trade balance deficit reached 27.3 billion €, more than quadrupled in
comparison with 2009, mainly due to a return to deficit for intermediate products, and an
expansion of the energy deficit. The dynamics of imports (+22.6%) outpaced that of exports
(+15.7%) and in both cases was more sustained in respect of non-EU countries.
Finally, as regards public finances, the Law of Stability for 20119Approved by Parliament
last December, has no effect on net borrowing for the next three years. Therefore remain
confirmed the objectives set by the "Public Finance Decision" in late September, though
updated by Istat for the year 2010: the deficit / GDP ratio fell to 4.6% (5% of the DFP) turns
to below 3% in 2012, in line with the commitments agreed at European level, while the
government debt / GDP, a further increase to 119% (from 118.5% of the DFP), is expected
to decrease only from 2012.

Financial markets




The yield curves U.S. and EU have highlighted for maturities beyond a year, a substantial
downward shift compared to December 2009 in line with the prolongation in the two areas
of very expansionary monetary policies. Compared to


8   According to preliminary estimates by the Bank of Italy, a measure of the degree of under-supply of work which
    includes the equivalent of hours of the IGC and workers who, discouraged, looking for a job with less intensity
    would lie at least two percentage points above the unemployment rate.
9   This measure, which this year replaces the Finance Bill following the reform of accounting and public finance
    (Law 19/2009), foresees the availability of resources for a total of 6 billion in 2011, 1.6 billion in 2012 and 1 2
    billion in 2013.

18
the end of June, however, there is an increase - in the case of the United States has involved only the
maturities longer than two years - both in relation to an improvement in prospects for economic
growth and an increase in inflation expectations. Just the concerns expressed by the ECB, however,
reiterated its meeting in March 2011, for the price surge in recent months and the consequent
expectation of a rise in interest rates can quickly justify the rise in yields since June for Europe lasted
less than two years.

              Performance of the main short-term rates and long-term in 2010                                                                              Graph 5
  5,25
  5,00
  4,75
  4,50
  4,25
  4,00
  3,75
  3,50
  3,25
  3,00
  2,75
  2,50
  2,25
  2,00
  1,75
  1,50
  1,25
  1,00
  0,75
  0,50
  0,25
  0,00
         G        F             M          A              M               G             L            A           S                O          N               D


                  U.S. Treasury 10 years                           Federal funds rate                          BTP 10 years
                  Euribor 3 months                                 Bund 10 years                               ECB main refinancing rate

                  U.S. Libor 3 months



After a successful start,
                                               Developments in major stock indices in local currency
in second    quarter
of   2010             i      markets                                                        Dec-10       Sep-10           Jun-10           Mar-10           Dec-09           Change%

stock major                                                                                   A            B                  C              D                   E             A/E

economies                  Industrial           Ftse Mib (Milan)                              20.173       20.505             19.312             22.848          23.248        -13.2%

             immedia                            Italy FTSE All-Share (Milan)                  20.936       21.098             19.869             23.368          23.653        -11.5%

have         tely           a
                                                Xetra Dax (Frankfurt)                          6.914        6.229              5.966              6.154              5.957      16.1%
abrupt         inversion of                     Cac 40 (Paris)                                 3.805        3.715              3.443              3.974              3.936      -3.3%
trend        caused     by                      FTSE 100 (London)                              5.900        5.549              4.917              5.680              5.413       9.0%
fragility    of       recovery,                 S & P 500 (New York)                           1.258        1.141              1.031              1.169              1.115      12.8%

but    especially              by DJ Industrial (New York)     11.578 10.788 9.774   10.857   10.428  11.0%

turbulence              triggered Nikkei 225 (Tokyo)
                                   Nasdaq Composite (New York)  2.653  2.369 2.109    2.398    2.269  16.9%
                                                               10.229  9.369 9.192   11.244   10.546  -3.0%
         crisi
by       s        of        debts Topix (Tokyo)                   899    830   828      985      908  -1.0%

Public         sovereign        of MSCI Emerging Markets        1.151  1.076   918    1.010      989  16.4%

some European states,
which
penalized in particular the banking sector. In the second half recovery was widespread, although in
some cases not enough to cover the losses.
In the twelve months, the U.S. exchanges have shown increases of more than 10% in some cases able
to recover previous levels of the collapse of Lehman Brothers, while on the contrary, the Japanese
markets were closed in modest decline. In Europe, the trends were different: the brilliant result of the
German stock exchange, supported by strong economic recovery, have opposed the difficulties for the
countries most affected by the crisis of sovereign debt (Portugal, Ireland, Greece and Spain),
particularly reflected evident in other markets such as the Italian area.
In line with the dynamics of the other world stock markets, including stock prices in emerging
economies have recovered from the lows of the second quarter, year-end MSCI Emerging Market index
showed an improvement in fact more than 16%.




                                                                                                                                                                                  19
The political events that are affecting North African countries are likely to jeopardize the
progress that the bags had scored in the first weeks of the new year.

After a partial recovery from the lows touched in May, stock markets managed by
Italian Stock Exchange have suffered a further decline in the fourth quarter closing 2010,
with losses exceeding 10% annually. They are also due to the considerable weight of the
banking sector, despite the solidity of Italian banks, has been particularly sensitive to the
multiple shocks generated by the progressive extension of the crisis of sovereign debt.

The stock exchanges have been reduced in terms of number of contracts (62.2 million, -3%),
but their values increased over the previous year (748.2 billion, +11%).
Similarly, average daily trade in shares decreased (243,000 contracts), while it has
increased the equivalent (2.9 billion).
Despite the difficult context, in 2010 the markets managed by the Italian Stock Exchange
have been able to establish additional firsts: new highs to trade ETFs (Exchange Traded
Fund) and ETC (Exchange Traded Commodities), with 78.5 billion and equivalent to 3 , 4
million contracts, and those of the MOT and dell'ExtraMOT (a total of 230 billion equivalent
and 3.9 million contracts) for equity derivatives trading record dell'IDEM
(Italian Derivatives Market), with a daily average of 173 000 standard contracts, confirming
the European leadership on electronic markets and trades on both the MOT.
At year-end companies were listed on the Milan Stock Exchange 332, unchanged from the
first twelve months as a result of 10 new admissions and 10 withdrawals. The total
capitalization of listed companies fell to 425 billion euro (27.4% of GDP), from 457 billion at
the end of 2009 (30.1% of GDP).
Reflecting the increased turnover of stock in the presence of a diminished capitalization,
turnover velocity in the twelve months10 increased from 147% to 176%.

On February 9, 2011 London Stock Exchange Group, parent company of the Italian Stock
Exchange, and TMX Group, owner of the Toronto Stock Exchange, announced the
forthcoming merger that would lead to the creation of one of the leading organizations in the
sectors related to raw materials and derivatives bonds, with over 6,700 companies listed on
several exchanges and a market capitalization of approximately € 4.5 billion. The new
Group will be involved in the LSE from 55% and 45% to TMX. The transaction will enhance
the experience of stock market
Italian post-trading services as well as a center of global fixed income.

After a good year to start and a subsequent alternation of positive and negative results,
since the last quarter of 2010, the segment Mutual funds investment is back to show signs
of weakness. The net inflow of the year however, proved positive for € 5.7 billion (-0.7 billion
in 2009), summarizing the opposite trend among the Italian-based funds (-10.1 billion) - is
still hampered by an unfavorable tax treatment11 - And foreign funds (+15.8 billion), whose
impact in terms of assets has reached to almost 58%. In terms of type, the sale of liquid
products (-23.7 billion) and hedge funds (-2 billion) were more than offset by the increase in
total bond funds (+19.9 billion) of equity ( +3.7 billion), the balanced (+3.6 billion) and
flexible (+4.2 billion)12.
In late December, the assets had amounted to 460 billion, an increase of 5.7% from 435.3
billion a year earlier showing a shift in favor of bond funds (increased from 38.1% to 41.1%)
, equity (from 21.2% to 23.4%) and to a lesser extent

10   Indicator - the ratio between the turnover telematics market capitalization - indicates the rotation rate of the
     shares.
11 The D.L. 225/2010 so-called "Milleproroghe", converted into Law 10/2011, introduced the expected reform of
    taxation on mutual funds that will come into force from 1 July 2011. Under the new provisions also to Italian
    investment funds will be applied to the taxation on the "true", ie the gain or loss recorded upon the sale of the
    stake, instead of the "entitlement" to equate the tax treatment to that for foreign funds .
12 Assogestioni, "Map of Asset Management (collective management and portfolio management - 4th Quarter 2010".


20
flexible funds (from 13.1% to 14.6%) and balanced (from 3.9% to 4.6%), compared to a
substantial reduction in the amount of cash funds (from 20% to 13, 5%) and more modestly
by hedge funds (from 3.7% to 2.8%).


The banking system
During the year the Italian banking system was characterized by a slowdown in the pace of
growth in customer deposits - which was affected by the decreased propensity to save of
households - which has been offset by a moderate recovery of banking after the minimum point
highlighted in October 2009. Credit quality continued to deteriorate, albeit with less intensity
than in the recent past.

Based on data compiled by the Bank of Italy13The Direct deposits (Residents' deposits and
bonds) in December showed an annual change of +3.1% (+9.2% in December 2009), the
synthesis of a reduction of the bond component (-1.6% compared to +11.2 % at end 2009)
and a trend was still positive for the other techniques (+6.3% vs. +7.8% in December 2009),
supported primarily by the repurchase agreements (+82.7%).

As for the loans to residents in the private sector, at year-end their dynamic on-year stood
at +4.3% (+1.7% in December 2009). The funding for family and non-financial corporations
grew overall by 3.8% (+0.5% at end-2009), driven by the component for domestic (+7.5%
from +5.9% in twelve months first), in particular loans for house purchase (+8%) and
resulted in slowing down the different forms of consumer credit (+1.8% from +4.9% in
December 2009). The credits aimed at businesses have finally been reversed (+1.6%
compared to -2.3% at end 2009).

In terms of risk, the sufferings of the private sector before depreciation increased by 31.2%
in the twelve months (+31.3% for those families and those +31.5% of companies). The report
Private sector gross NPLs / total loans to the private sector therefore increased to 4.60%
(3.81% in December 2009).
Net bad debts have grown significantly in terms of stock from March, showed an increase of
28.9%. Consequently, the ratio non-performing loans / total loans rose to 2.43% from
2.03% at end-2009 while the ratio non-performing loans / capital reserves reached 13.28%
(10.47% at the end of 2009).

At year-end Titles, other than shares and equity issued by residents in Italy in the portfolio
of Italian banks showed an increase trend of 8, 5% due to new investments in government
bonds (+30.5%) mainly concentrated in the first half - both medium to long term (CCT and
BTP, +36.2%) and short-term (BOT and CTZ, +20.1%) - compared to a reduction in "other
securities" (-2.7%). Within the latter over 70% continues to be represented by bonds. The
report bonds / loans to the private sector has thus stood at 33.4% (28.3% at end 2009).

After reaching a minimum in June (1.36%), in December the weighted average rate of bank
deposits from customers calculated by the ABI14 (Which includes the return of deposits,
bond and repo € for families and non-financial corporations) was equal to 1, 50% compared
with 1, 59% a year earlier. Similarly, the weighted average rate on loans to households and
non-financial corporations, In line with the trend of the conditions in the interbank market
has shown signs of recovery compared to an historic low in June (3.52%), returning to
3.62% (3.76% in December 2009).

                                                         ***



14   Bank of Italy, Supplement to the Statistical Bulletin "Money and Banks", March 2011.
15   ABI Monthly Outlook, "Economics and Financial Markets-Lending" in February 2011.

                                                                                                   21
Besides the above mentioned developments taking place in the international regulation, the
legal framework of reference for Italian banks in 2010 saw many changes:
         March 1 came into force on the European Payment Services Directive (PSD), a
         measure designed to eliminate regulatory differences between Member States and
         increasing competition between operators, ensuring a level playing field, more
         transparency and safeguards against customers. The directive orders in a single
         framework of the whole problem of payments with the aim of providing support for
         electronic ones, the creation of an integrated European market, reducing costs and
         inefficiencies of papers and cash;
         October 11, have started negotiations on the new segment Market Interbank
         Collateralized (MIC)15, Called the "New MIC, with the transfer
         Clearance and Warranty and Monte Titoli of the functions previously undertaken by
         the Bank of Italy (guarantee transactions, acquisition, evaluation, custody and
         management of financial assets conferred to the banking industry);
         with the D.L. 78/2010, converted into Law 122/2010, has been reduced from 12,500
         € to 5000 € the limit above which there is a ban on the transfer of cash, issuance of
         bank checks / circulars / mailing in a free and possession of bearer passbooks;
         Legislative Decree no. 39/2010, transposing Directive 43/2006, has rewritten the
         rules concerning statutory audit reorganises and requiring compliance with specific
         standards of independence, ethics, training and control quality. For public interest
         entities (including banks, issuers of listed securities, insurance and securities firms)
         the statutory audit can not be exercised by the board but must be carried out by
         statutory auditors or audit firms el ' assignment must have a minimum of seven to
         nine years;
         Finally, with reference to the listed banks:
           · in March, the Consob16 issued the Regulation on the operation with related
               parties which governs the procedures for approving transactions of significant
               value as a counterparty subject having a potential conflict of interest;
           · by Legislative Decree no. 27/2010 was implemented Directive 2007/36/EC on the
               rights of shareholders innovating in many ways the Civil Code and the
               Consolidated Law on Finance, with the consequent adjustment of the Issuer
               Regulations also17. The enhancements, which are applicable to meetings
               convened after October 31, 2010, have no effect on co-operative societies, which
               are expressly excluded from the scope of the new legislation.




15   The MIC was a segment of the anonymity of e-trading platform Mid, exists to facilitate the resumption of trading
     on the interbank as a result of the financial crisis of 2008. When the constituent is expected to be due on
     December 31, 2010 for guarantees given by the Bank of Italy.
16   Resolution No. Later amended by Resolution No. 17221 17 389 of 23 June 2010.
17   Consob Resolution No. 17592 of 14 December 2010.
22
The activity of the Banco di Brescia in 2010

Retail Market
Ben notes the current economic situation in 2010 showed tentative signs of recovery,
although not continuous and structural, but the will of the productive system to react to the
recession, increasing productivity and innovation and looking more and more oriented
towards foreign markets. These are, in fact, the real driving force, they represent a tool for
differentiation of turnover and a balanced point of view favorable to better anticipate market
trends.
The persistence of this particular economic environment has required considerable effort to
achieve its goals, while maintaining attention to the financial support of the local economy
and families.
Numerous initiatives have been divided by type of customers, followed by specific detail.


Scope Private
During the year, in the development of instruments targeted acquisition of new
Customers, especially young people do not bankarization, was launched the marketing of
the card "Enjoy", which throughout 2010 has gathered a group as positive appreciation of
the advantages and features a real electronic card payment with those of a current account .

Also as part of payment systems, the second half of 2010 saw the branches involved in
major activities replacing credit and debit cards with multi-only magnetic stripe technology
with the new debit card and Libramat Credit Libra single function, with microchip to meet
the highest standards of security EMV - Europay, MasterCard and VISA.

A confirmation of the segment towards the young, beginning of the year has started
marketing the new book "Clubin" reserved for children from 0 to 17 years, under conditions
of high competitiveness and tied to a rewards program for the younger .

To serve clients in the placement of financial instruments, particular attention was paid to
the insurance industry, and direct deposits in the medium term.
The basket of bonds in the bond has been characterized by the presence of emissions
Floating Rate and Fixed Rate, the latter showed the preference of our customers both with
the short-term loans (25 months) than those of medium duration (36 / 48 months).

As part of the bonds of the Group, the emissions were four, including some so-called
"Welcome Edition", dedicated to raising new money with very favorable rates, which bore the
network in the activity of acquiring new assets from other institutions, thus strengthening
the already good relations with its customers.

As for the insurance offer, the placement will be focused almost entirely on traditional
Branch I - funded life insurance policies - and confirmed
a positive trend of inflows. Particular attention has been paid to policyholders
Non-life segment, where the network has found sales support by assisting with the advice of
the manager with the technical skills of staff for UBI Assicurazioni.

In the asset management, 2010 was marked by intense activity on stocks in the reallocation
of cash funds to types of funds with the highest added value for customers (flexible bond
and balanced funds).


                                                                                                 23
In addition, with the aim of supporting the branches in the placement of specific asset
management products, have been organized in collaboration with UBI Pramerica, a series of
meetings with managers, providing ideas and regular updates on the commercial market
scenarios.

For a better service to customers in the investment sector in the early months of 2010 has
started the new financial counseling service UBI Light / Advanced directed the segment
"Private".
Through this service, the customer can count on personal advice regarding financial
investments based on their investment objectives, knowledge and experience in financial
and risk appetite.

Particular attention was paid to private residential mortgage sector, also in view of the
persistence of a substantial rigidity of the housing market and the uncertainty felt by
families.
The commitment of the retail market is reflected in various activities such as:
        careful policy of "pricing" on new customers and subrogation active borrowers;
        development of agreements with external networks (FIAP-Italian Federation of
        Professional Estate Agents and KIRONEPICAS Tecnocasa Group);
        marketing, in line with the Group's products to capture new customers and to
        counter the risk of passive subrogation.

As part of the distribution of loans by B @ nca 24 / 7, we note that with reference to the
"Family Plan", according to the ABI and the Department for Family Policies of the Presidency
of the Council of Ministers, was established with Banca 24-7 the product " Loan New Born
"to facilitate access to credit for families with a child born or adopted in 2009, 2010 and
2011.

With reference to the constantly manned by our Institute and the level of service received by
customers, continued efforts are dedicated to the monitoring of customer satisfaction in
cooperation with the Contact Center of UBI Bank and with outside companies, such GFK
Eurisko Demoskopea.

In connection with the CRM tool "In Action", throughout 2010 continued activation and
development of marketing campaigns in support of the Network on the following areas:
        Collection: Analysis of the customer's financial position to propose, according to
        profiling MiFID, financial instruments more appropriate;
        Lending: Identification of customers with greater propensity to purchase Loans
        Personal and revolving credit cards;
        Retention: Contact action aimed at strengthening the customer base;
        Security: Finding the clients that holders of insurance policies and highlight needs
        for protection purpose in order to increase the penetration of Damages and Health
        Policies.

In December, the initiative was set up business "Christmas 2010", produced in
collaboration with Vodafone Italy, was to issue the customer a good value discount of € 144
be spent at all outlets Vodafone One for the purchase of a smartphoneAs having signed a
card or Enjoy a credit card Libra both under standard conditions.

Subject to the provisions of Supervision of the Bank of Italy on transparency of transactions
and banking and financial services have been introduced important innovations with regard
to the documentation to be sent together with the extracts of the current account at year
end. The main novelty, to which our Institute has quickly adjusted, include the obligation to
report the annual summary for clients 'consumers' synthetic indicator of the cost (ISC), as
well as the obligation to submit, for customers, "retail", a new brochure entitled "Summary
of the overall expenses



24
incurred during the calendar year, for keeping the current account and cash management
services and payment. "


Business Scope
Banco di Brescia, in 2010, took the signs that companies have launched, offering practical
support for funding the working capital. To confirm the self-liquidating Loans, advances
portfolio of commercial and / or invoices, have seen an increase since the end of 2009.

It is also worthwhile to be pointed out that even in medium term, just to support the
business plan of the medium term have increased over the previous year, however in this
sector reads a slight change of the trend to 2009, when it showed the use of medium-term
loans to consolidate debt and / or try to dilute the debt, thus relieving the financial
structure in 2010 has seen grow operations sender back to productive investment in
machinery and processes.
Analog signal comes from leases, which have grown in terms of amounts, compared to 2009,
which already marked a positive trend, however.

Furthermore, the possibility of combining insurance claims generated a strong interest in
business as the same shall give an opportunity, in case of an accident and thus unable to
work in the company, to obtain from UBI secure the payment of mortgage payments . The
tool was flexible and ensures quiet entrepreneur in assuming financial commitments in the
medium and long term, ensuring that in case of accident, activity in the complex it is to
suffer less.

In this context, the strong partnership that Banco di Brescia has made with all
Consortia of the territory has certainly facilitated the provision of credit, since the synergies
between the customer, consortia and banks have allowed a deeper understanding of the
entrepreneur and his business plan. The assessment of credit risk has therefore had, by
this synergistic model, two levels of approach, quality and quantity.

Recall that the 2009 and 2010 were years of "affirmation" of the consortia, as they have
experienced an initial period of mergers and acquisitions and then move to a new and more
complex organizational change, focusing, in different ways, to the structure supervised by
the Bank of Italy (ex 107). In this context, the 2009 delivered significant performance,
especially not escape corporate commitment to support enterprises in the midst of a
financial crisis in 2010 has consolidated these results, dividing the number of cases further
provided: the number of loans granted is in fact increased compared to 2009. It is also
important to note that the business support, with the partnership between Banco di Brescia
and consortia, it was confirmed both on sales volumes and prices, remained unchanged for
several years, powerful message of responsibility that once again the Bank wanted to send
to different local conditions.

To ensure steady and continuous support to SMEs in point credit has continued in the
second half of the year, the positive experience of the "Tables of credit" which consist of a
detailed comparison between the Polo Resolution Peripheral and Area Spatial Reference .

The synergies between the poles of deliberation and Small Business Managers, together with
joint visits to customers between them and of the international specialists, agents /
managers of UBI UBI Leasing Agents and Insurance Companies have granted to corporate
customers of Banco di Brescia a full service and capable of satisfying all their financial
needs and credit.

The Swiss Retail Market - Segment Business - over 2010 was particularly active in
designing the foundations for a profound and direct dialogue with the territory, organizing
or participating in conferences or round tables with different associations, not only on topics
closely related the world of finance, but also of character. During the

                                                                                                    25
the first half had a successful conference dedicated to the sector "Agriculture in front of the
market." On that occasion, were discussed topical issues of close, or how the farm is likely
to alter its organizational structure and business in order to address the competitive
challenges now present in global markets. In the first half, the Swiss retail market has
accepted the invitation of the ACAA - Association of Italian Christian Artisans - to meet on
the theme "Innovation and development, ensure the credit to craft industries and small
businesses to encourage them to return" at Milan, where at the end of the year, was another
interesting meeting with
Confapimilano, ConfapiLombarda Trust and the Chamber of Commerce of Milan on
"between Basel and Basel 2 3 Return to the business center."

The strong commitment to support the economy of the territories manned by Banco di
Brescia has also materialized in June with the signing of an important Protocol with the
Province of Brescia, through which the Bank is committed to advance claims against the
Public Administration of the Province of Brescia SMEs who request it. This anti-crisis plan
is particularly important for the fact that the bodies involved, subject to strict rules of the
Internal Stability Pact, can provide liquidity to their suppliers through the banking system,
with advances on credit, confirmed by them, even with duration of up to 17 months.

The management of the Treasury Service of the Public in 2010 involved the replacement of
many conventions, as well as the acquisition of new in the province of Mantua, land
development Tour of Brescia.
The driver followed for a proper defense of the fund have been essentially four:
     1 - Revisions to the terms of agreements expire in cash;
     2 - Strong attention to supporting local authorities with adequate funding to compliance
          "Stability Pact";
     3 - Issuing the order systematic Computing, which is the dematerialization of mandates
          and reversals with the aid of digital signatures and electronic storage.

In this context, the Bank has successfully participated in a number of calls for the provision
of medium and long term.


Corporate Market
The business' Market Corporate Banco di Brescia, in the difficult economic environment
began in late 2008 and still in progress though with signs of slight improvement, the
corporate market has seen committed towards the strengthening of ties with the territories
of election, strengthening the garrison on regional development also due to start
relationships with trade associations, chambers of commerce and public institutions.

The Corporate Banking Unit of the Corporate Market active in 2010 were 15, saw them
engaged in resources 109 (15 managers and 94 managers).

The volume of loans has been affected by economic developments throughout 2010.
The decrease in turnover of the main productive sectors has its toll on lending volumes, but
recorded a minimal growth.
The same applies for loans to medium and long term, which, because of uncertainties about
future demand conditions, volume growth generated content.
They also have suffered from an increasingly 'selective and closely monitored especially
towards the residential sector, leading to a gradual reduction, not replaced by new
interventions.

The crisis has affected the collection throughout the year, with cash 'company designed,
where possible, to meet the needs of their own company, registering a decline towards the
end of the year.



26
Intermediate flows and practices outside Italy, while still a gap compared to pre-crisis,
if included in the economic reference point to a tangible recovery in terms of market
share and greater operational selectivity, which have generated better returnsin
terms of income, thanks to planned actions and direct the recovery of market share
with high-margin operations'. In particular, the contribution of exports and 'failed for
the moment to address the decline in imports on certain sectors (eg steel, metal
working in general, processes raw materials).
In the area of derivatives, the offer has been on products for hedging interest rates
and with results that was affected by the dollar, the general uncertainty in currency
markets and the trend EURIBOR which led traders to a wait "approach.
And ongoing collaboration with the manufactures products that have enabled
satisfactory economic returns for traded volumes and return commissions.
The close collaboration that has allowed to further strengthen the relationship with
the companies in our territories and let us enjoy in the territories of development.
Private Market
Although in the presence of a scenario characterized by a relative immobility of
interest rates and financial markets have gradually increased their volatility during the
year, the private market has shown good results as regards the main indicators of
profitability and productivity generated .
In response to a positive growth of the customer base, the market got a margin
increase compared to last year.
Gross profit was a sharp increase, partly due to cost rationalization.
This has allowed the market to move from a "cost / income ratio of 52.9% in 2009 to
45.0% reported for the end of 2010.
Good was the tightness of the financial margin, supported in particular by a careful
management of funding costs and a buoyant lending, while revenues from services
have benefited from good sales and made improvement in asset mix the asset
management, as well as by the significant volumes generated from the market in the
placement of life insurance.
In detail, as part of the asset management has been awarded a major project to
improve the diversification of investments, with the inclusion of funds in the portfolios
of the customers of the Company best investment houses worldwide, to support
growth sustainable revenues over time.
Bancassurance The fund, similar to market trends, the stock has increased due to
the placement of products of class I and class V to undermine performance
guaranteed.
Both sectors have benefited the masses of the customers returned in the year
following the closure of practices "impediments" for the Tax Shield.
During the year, the activities aimed at disseminating services / products reserved
exclusively to customers of the market, in this area have been reported good results
for the spread of customized consulting services AWA developed dall'apposita
Parent property , both as regards the spread of the Credit Card Black Kalia, which
additionally offers prestigious services, designed to meet the needs of clients of high
standing.
To further support the margin on services during the year have been concluded some
important placements of subordinated bonds / structured group and third parties such
activity was supported by the new service model for the consultancy to
).
Customers who, in accordance with the dictates of the MiFID legislation provides for the use
of the new platform of Planning Financial Consulting (PCF).
The development strategy of the numerical base and market share on the individual
customer has been characterized by specific development initiatives.
Through the enhancement of training and professionalism in the various segments was
launched during the last quarter of the year and two operating units, organized an initiative
designed to fully exploit the potential customer base of the Bank, with the 'objective to
support growth through a process involving the generation of reports from cross-contact
potential customers in the Corporate Market and synergy between the private market, action,
coordinated on the ground, provides for the creation of specific joint development meetings
between the Private Banker Corporate account manager and that, thanks to a particularly
attractive location, are aimed to develop a numerical basis of the Bank's clients. Thanks to
the results, this initiative will be extended to the whole network in 2011.
Also, with the aim of increasing awareness of the customers on their choices of investment
through economic and financial training, dissemination and updating of information, the
private market has promoted over the last months of the year, a cycleof short training
seminars dedicated to its current and potential clients in the areas of development (Treviso,
Verona and Cremona).
The business, which saw the involvement of professors at the Catholic University of Milan
and external evidence of major market players, has aimed to introduce participants to the
issues and scientific tools needed to make the correct choices oninvestment, particularly in
managing their family wealth.
During the year continued, finally, the training is on specific financial issues, involving the
Group's asset management company and some Third (Black Rock - Schroders - Pictet), and
specific in-depth regulatory / operational (Isvap - PCF ).
E 'was also launched an advanced course in asset allocation and continued training courses
to prepare for the examination of enrollment and financial advisor for the recent acquisition of
resources by the market.
Credits
The total loans and advances to customers were up over the previous year, both in the short
component in MLT. This growth reflects, in a difficult economic environment, the ability to
continue to support the economic and social reality of the areas protected, with particular
reference to the SME segment.
Regarding credit quality, the economic soprarichiamato and the continuation of a crisis that,
although with different strength, affected all sectors of the economy have led to an increase
in loans and a trend increase in the riskiness of the portfolio. Have increased the suffering
and the deadlocks, thereby increasing the related writedowns. Simultaneously, the collective
impairment losses on performing loans have increased in order to align the total amount
earned in accordance with data derived from the model and updating of the Basel 2 risk
parameters.
Human Resources
At December 31, 2010 the staff to "payroll" of the Banco di Brescia consisted of 2627
units. Since the end of the year were 76 operational resources seconded from other Group
companies, while the Banco di Brescia had, in turn, 69 employees seconded to other Group
companies, but overall the staff "work" of the Bank amounted to 2,634 units .
The recruitment in 2010 totaled 23 units, mainly on resources included with fixed-term
contracts, 10 contracts also have been active work of administration to cover temporary
needs of the Bank.
The closures have affected a total of 133 employees. Were 81 retirements, 74 of which
encouraged under the Framework of Group of 20 May 2010.
The training was mainly targeted at strengthening the professional skills of network roles
(Commercial, Banking and Finance), Scope Bancassurance, the mandatory regulations
(Decree 231) and management training and behavior.
To report action taken to strengthen the skills of the role of "Head of Branch - Va.Lo.Re. on
the Net - and continued in 2010 in the Project (PCF Planning and Financial Consulting)
addressed to the retail market, with branch managers, Managers and Mass Affluent Market
and, for the private market, the Private Bankers.
For the corporate market point the way higher education "Excellence in Corporate Banking
Managers to CBU and Account Manager, aimed at strengthening the skills in Corporate
Advisory "and a distinctive approach to its customer base.
Continued, finally, the programs under the Training School for future branch managers of the
Group, while also using the formula "distance learning" courses were made available on the
Decree. 231, Patti Chiari and banking transparency.
Spatial development and organizational
With effect from 25 January 2010, following approval by the UBI Banca Group Project
Optimization by Place, Banco di Brescia has sold 28 branches located in the areas of Monza
and Brianza, Como, Varese, Lecco, Parma, Genoa and turin, and has acquired 34 (plus 3
mini-branch) located in the provinces of Mantova, Brescia, Verona, Cremona, Lodi and
Padua, becoming the bank of the Group for these provinces and for the entire Triveneto. The
transfers took place through the doors of intercompany transfers and sales of their
businesses.
In June 2010, upon completion of the rationalization measures introduced earlier this year,
we proceeded with the closing of seven branches and two mini-branch, affected by spatial
overlap, and the redevelopment of a mini-branch in the door.
On December 10, 2010 also saw the completion of the project to rationalize the Group's
presence in Luxembourg by UBI Banca UBI Banca International to the transfer of the
business of Banco di Brescia consists of the Luxembourg branch.
As a result of the interventions described, 31 December 2010, the Bank's distribution
network is divided into:
· 362 branches (including 13 mini-branch) located in 17 provinces;
· 10 Territorial Areas Retail (ATR);
· 15 Corporate Banking Unit (CBU) and 8 Corporate Corner;
· 12 Private Banking Unit (PBU) and 4 Corner Private;
· 9 Resolution Peripheral Poly (PDP);
· 7 centers abroad.
It 'important to note that in September 2010, the UBI Banca Group has adopted the New
Model Retail aims to strengthen the territorial presence and improve commercial
effectiveness of the operational units of small size (ie less than or equal to 4 organic
resources ). The model, whose adoption is expected in 2011, provides for the maintenance
of the divisional structure of the three markets
(Retail, Corporate and Private) and the subdivision of the Branches in
"Responsible" and "Aggregate". Each branch will be assigned supervision of
the Responsible Branch Aggregate geographically contiguous areas while the
Regional Retail will have the direct coordination of the Branch Responsible
jurisdiction.
With the new distribution model for the joint scheme of the Net Retail Sales
evolve, therefore, summarized as follows:
· 362 branches located in 17 provinces, 349 retail branches - including 71
seats 5 and Responsible Independent - and 13 mini-branch;
· Areas 7 Territorial Retail (A TR);
· 13 Corporate Banking Unit (CBU) and 11 Corporate Corner;
· 10 Private Banking Unit (PBU) and 3 Corner Private;
· 7 Resolution Peripheral Poly (PDP);
· 7 centers abroad.
In the second half of 2010 has also provided a review of organizational
structures / functions of government and central support, to enable the same
to better meet the primary need to ensure the quality of operational
coordination and to ensure, in a vision systemic, appropriate control measures
and all the activities and processes inherent in the business, in accordance
with applicable provisions of law and business. The criteria that have inspired
a reassessment of the macrostructure of the Institute were as follows:
- A better focus of the functional units placed in charge of the operational risks
by establishing, reporting directly to the Director-General, the Staff Risk
Control ";
- Reconfigure the powers of the General Staff Department, concentrating on
business functions for the Coordination of Operation "and" Administration and
Planning ", so as to have, respectively, a center of competence for micro-
organization of branches and a 'appropriate structure for the control of
management and management reporting;
- Reconfigure the functions of the Resource Management and integrated
support in a single group activities typical of the "Personnel Management" and
those of their "Legal and Corporate Affairs", thus creating an organizational
entity that performs the support to the Directorate General and
Bodies College;
- To provide the commercial area of a specific "support staff", with dependency
directed by Sales Manager, through which activate d ensure the coordinated
management and monitoring of all business development initiatives and
activities cut across the three segments market.
Finally, with regard to the park of ATM and POS, 31 December 2010 the Bank
has 478 ATMs (17 of them for specific functions have been activated to use
the visually impaired) and 40 advanced ATM cash in / cash out . Also at the
end of 2010, are 6,240 retail outlets which are installed on POS devices Banco
di Brescia.
·
·

·
·
·




    31
The system of internal control
Network Auditing
The progress of internal audit of the Banco di Brescia is centralized at the Macro Area Audit
of Parent and UBI Banca Group on the basis of specific contract delegation. This activity is
performed in accordance with a "Operation Manual" that describes the methodologies and
operational tools, the complete catalog of the types of intervention, working papers and
checklists to support, as well as the relevant reports. The following are the types of activities
with a brief description of the related control objectives:
Analysis system, designed to assess the adequacy of the risks inherent in activated
processes and organizational units subject to verification, each subdivided into:
· Management Audit aims at evaluating the functionality of the overall system of internal
controls;
· Operational Au dit, the purpose of the appreciation of processes and organizational units in
terms of effectiveness, efficiency and reliability;
· Financial Audit, the purpose of the appreciation of the organizational units and processes
inherent in the accounting system;
· Compliance Audit, which aims to assess conformity with the provisions of the processes of
external regulators;
· ICT Audit and aims at evaluating the adequacy of the structure of IT technology, on -site
audits of operating processes and organizational units and the central network, aimed at
checking the consistency of behavior willing to legal and regulatory controls inspection,
aimed at ' observation of operations employees in order to prevent events of injury to the
company, administrative investigations, aimed at finding liability as a result of internal or
external events affecting the company, remote controls, to monitor areas / phenomena that
affect the operation of the database structure in order to verify compliance with company
regulations.
More specifically, the operation checks on sales networks involving all areas of their
business delegates, organized process / activity (credit intermediation process, process of
selling financial products and investment services, banking products for sale process, the
Operation Front and Back Office, Management Values and Means Strong, physical and
logical security, Various Compliance, Monitoring Operational Management, Treasury). The
methodology includes the assignment of a rating, determined with respect to the deficiencies
for each job / task analysis and an evaluation summary rating. From these results it is also
possible to extrapolate a "view" for each of the external regulations that have implications on
the operation of staff to the sales networks.
During 2010 total were carried out No Interventions on 213 outlets belonging to all markets
(Retail, Private and Corporate), of which no 139 visits overall (taking into consideration the
Network Drive as a whole) at the Retail Branches, No 50 at the Corporate Banking Unit and
No 24 at the Private Banking Unit, in addition to the regular remote controls. While referring
to the Quarterly Reports produced by the Macro Area Audit of Parent and UBI Banca Group
for details of the interventions made and the results - covering both central and peripheral
structures of the Banco di Brescia, both in service activities and by UBI Banca UBI Systems
and Services - briefly inform you that the spot checks on sales networks were, in a situation
of prevailing positive, some areas for improvement with regard to the sales process banking
products and operational management in relation to the retail market.
The remote monitoring have shown the generally compliant company, and occasional
interventions were against network drive to urge greater attention to the management of
operational areas subject to
Reclassified financial statements
Balance sheet and income statement

In order to facilitate analysis of economic and in compliance with the Bank
Consob Communication DEM/6064293 of July 28, 2006, among the reclassified was added
to a separate statement to highlight the economic impact of major events and non-recurring
transactions - because its effects are not significant and financial - that can be summarized
thus:



        2010:
            
                    incentives (AcAuditors Agreement of 20 May 2010).

        year 2009

           realignments statutory / tax on the three year period 2005/2007;
             deduct 10% of IRAP Ires;

             integration costs resulting from business combination transactions.



The following tables are represented in the reclassified balance sheet and income
statement.




It is recalled that in 2008 he started a program of issuing euro commercial paper and
certificates of deposit and negotiations in France reserved for institutional investors, which
involved a branch in Luxembourg, a subsidiary that was subject to contribution in UBI
Banca International SA with legal effect December 10, 2010.
In view of the special operations related to foreign subsidiary and trading volumes in terms
of deposits made with the parent company to cover the emissions of CDs and ECP, it was
considered appropriate for the purposes of better comparability restate the schemes assets
at December 31, 2009.
It will be recalled, however, that the periods of comparison are not homogeneous due to
spatial optimization.




                                                                                                 33
Reclassified balance sheet
(In thousands of euro)


                                                                                                                     Change          % Change       31/12/2009       Change          % Change
                                         ASSETS                                       31/12/2010    31/12/2009
                                                                                                                   Annual            Annual           restated     Annual            Annual

     10.          Cash and cash equivalents                                                73.922         92.584      (18.662)            (20,2)          92.584      (18.662)           (20,2)
     20.          Financial assets held for trading                                       100.954       114.259       (13.305)            (11,6)         108.420       (7.466)            (6,9)
     40.          Financial assets available for sale                                      20.913         26.339        (5.426)           (20,6)          26.339       (5.426)           (20,6)
     60.          Loans to banks                                                          851.391      7.442.072   (6.590.681)            (88,6)       1.464.430     (613.039)           (41,9)
     70.          Loans to customers                                                   15.078.204     14.178.741      899.463               6,3       14.111.750      966.454              6,8
     80.          Hedging derivatives                                                      45.471         75.128      (29.657)            (39,5)          75.128      (29.657)           (39,5)
     90.          Fair value of financial assets to cover GE                               40.200         21.556        18.644             86,5           21.556       18.644             86,5
     100.         Investments                                                              19.022         16.122         2.900             18,0           16.122        2.900             18,0
     110.         Tangible assets                                                         293.836       297.386         (3.550)            (1,2)         297.360       (3.524)            (1,2)
     120.         Intangible assets                                                        19.705         19.739           (34)            (0,2)          19.705              0                 -
                    of which: goodwill                                                     19.705        19.705                  -              -        19.705                  -              -
     130.         Tax assets                                                               65.837         76.127      (10.290)            (13,5)          75.490       (9.653)           (12,8)
     150.         Other activities                                                      1.012.350       320.367       691.983            216,0           695.402      316.948             45,6
                  Total assets                                                         17.621.805    22.680.420    (5.058.615)           (22,3)      17.004.285      617.520               3,6




                                                                                                                     Change          % Change       31/12/2009       Change          % Change
                      LIABILITIES AND SHAREHOLDERS 'EQUITY                            31/12/2010    31/12/2009
                                                                                                                   Annual            Annual           restated     Annual            Annual

      10.         Due to banks                                                          3.341.564     1.370.705     1.970.859            143,8         1.326.245    2.015.319            152,0
      20.         Due to customers                                                      8.885.718      8.870.849        14.869              0,2        8.607.554      278.164              3,2
      30.         Securities issued                                                     3.233.256     10.300.310   (7.067.054)            (68,6)       4.934.749   (1.701.493)           (34,5)
 40. + 50.        Financial liabilities held for trading and measured at fair value        76.037         81.138        (5.101)            (6,3)          80.770       (4.733)            (5,9)
      60.         Hedging derivatives                                                      64.840         51.429        13.411             26,1           49.958       14.882             29,8
      80.         Tax liabilities                                                          39.737         59.174      (19.437)            (32,8)          59.167      (19.430)           (32,8)
     100.         Other liabilities                                                       432.261       573.303      (141.042)            (24,6)         572.530     (140.269)           (24,5)
     110.         Provision for employee severance                                         61.987         63.808        (1.821)            (2,9)          63.706       (1.719)            (2,7)
     120.         Provisions for risks and charges:                                        26.301         22.999         3.302             14,4           22.999        3.302             14,4
                       b) other funds                                                      26.301        22.999          3.302             14,4          22.999         3.302             14,4
     130.         Revaluation reserves                                                     14.182         21.206        (7.024)           (33,1)          21.206       (7.024)           (33,1)
160. +170. +180   Capital, share premium and reserves                                   1.373.943      1.136.526      237.417              20,9        1.136.429      237.514             20,9
     200.         Operating profit                                                         71.979       128.973       (56.994)            (44,2)         128.973      (56.994)           (44,2)
                  Total liabilities and net worth                                      17.621.805    22.680.420    (5.058.615)           (22,3)      17.004.285      617.520               3,6




34
Reclassified income statement
(In thousands of euro)

                                                                                                                                 Change         % Change
                                   INCOME STATEMENT ITEMS                                      31/12/2010       31/12/2009
                                                                                                                                Annual          Annual


       10 .- 20.        Net interest income                                                         325.858          353.270       (27.412)          (7,8)
           70.          Dividends and similar income                                                  1.249            1.699          (450)         (26,5)

       40. - 50.        Net commission income                                                       196.007          200.248        (4.241)          (2,1)

80. + 90. +100. +110.   Net income from trading and hedging                                          (1.478)          10.204       (11.682)           n.s.

           190.         Other operating expenses                                                     14.846           20.740        (5.894)         (28,4)

                        Operating income                                                           536.482           586.161       (49.679)          (8,5)

        150th.          Staff costs                                                                (172.843)        (164.528)       (8.315)           5,1

         150b.          Other administrative expenses                                              (133.322)        (134.507)        1.185           (0,9)
     170. + 180.        Write-backs on tangible and intangible assets                               (11.101)         (11.627)             526        (4,5)

                        Operating costs                                                           (317.266)         (310.662)       (6.604)           2,1

                        Operating profit                                                           219.216           275.499       (56.283)         (20,4)

        130th.          Impairment / write-backs on loans                                           (97.859)         (69.220)      (28.639)          41,4

   130b. + C + d.       Impairment / write-backs for impairment of other activities' / steps           (849)          (1.348)             499       (37,0)

           160.         Net provisions for risks and charges                                         (2.875)          (3.258)             383       (11,8)

     210. + 240.        Profit / loss from sale of equity investments                                 1.296              (76)        1.372            n.s.
                        Profit / loss from continuing operations' income before
                        taxes                                                                      118.930           201.597       (82.667)         (41,0)

           260.         Income taxes for continuing operations' current                             (46.951)         (71.893)       24.942          (34,7)

                        Integration costs                                                                   -           (732)             732              -

                        of which: staff costs                                                               -           (597)             597              -

                                Net adjustments to tangible and intangible assets                           -           (441)             441              -

                                taxes                                                                       -            306          (306)                -

           290.         Operating profit                                                            71.979           128.973       (56.994)         (44,2)




Construction method in the reclassified
Main classification rules:

       ·          the overdraft charges recorded in 10 - 20 "Net interest income (€ 747 000 and
                  15503000 to 31/12/2010 to 31/12/2009) are reclassified as 40 to 50" Net
                  Commissions ";
       ·          recoveries of 190 sets recorded under "Other net operating income (€
                  24.103 million and 23.491 million to 31/12/2010 to 31/12/2009) are reclassified as
                  a reduction in indirect taxes included in other administrative expenses;
       ·          the valuation adjustments, net tangible and intangible assets includes items 170
                  and 180 of the key accounting and the amortization of costs incurred for leasehold
                  improvements (to 31/12/2010 and € 961 000 963 000 31 / 12/2009) are classified
                  as a statutory statement 190;
       ·          the Other income / expenses include the item 190, net of reclassification mentioned
                  above.




                                                                                                                                                           35
Reclassified income excluding major non-recurring items
(In thousands of euro)


                                                                                                                  Non-recurring
                                                                                                                  items                                                                    Non-recurring
                                                                                                                                       31/12/2010                                                                                            31/12/2009
                                                                                                                                          net of                                                                           Integration          net of                   variation
                                    INCOME STATEMENT ITEMS                                       31/12/2010                                                31/12/2009                                                                                        variation
                                                                                                                  Incentives           non-recurring items                 Realignment             Repayment IRAP          expenses          non-recurring                    %
                                                                                                                                                                                                                                             items
                                                                                                                    early retirement                                      Taxation "FTA"           years 2004 - 2007



      10 .- 20.    Net interest income                                                                325.858                                325.858           353.270                                                                          353.270       (27.412)        (7,8)
        70.        Dividends and similar income                                                         1.249                                  1.249             1.699                                                                            1.699          (450)       (26,5)
    40. - 50.      Net commission income                                                              196.007                                196.007           200.248                                                                          200.248        (4.241)        (2,1)
 80. + 90. +100.
      +110.        Net income from trading and hedging                                                 (1.478)                                (1.478)           10.204                                                                           10.204       (11.682)         n.s.
        190.       Other operating expenses                                                            14.846                                 14.846            20.740                                                                           20.740        (5.894)       (28,4)
                   Operating income                                                                  536.482                      -         536.482           586.161                          -                       -                 -     586.161       (49.679)        (8,5)

       150th.      Staff costs                                                                       (172.843)            3.869             (168.974)        (164.528)                                                                         (164.528)       (4.446)         2,7
       150b.       Other administrative expenses                                                     (133.322)                              (133.322)        (134.507)                                                                         (134.507)        1.185         (0,9)
     170. + 180.   Write-backs on 'tangibles and intangibles                                          (11.101)                               (11.101)          (11.627)                                                                         (11.627)          526         (4,5)
                   Operating costs                                                                  (317.266)             3.869            (313.397)         (310.662)                         -                       -                 -    (310.662)        (2.735)         0,9
                   Operating profit                                                                  219.216              3.869             223.086           275.499                          -                       -                 -     275.499       (52.413)       (19,0)
       130th.      Impairment / write-backs on loans                                                  (97.859)                               (97.859)          (69.220)                                                                         (69.220)      (28.639)        41,4
  130b. + C + d.   Impairment / write-backs for impairment of other activities '/ liabilities'           (849)                                  (849)           (1.348)                                                                          (1.348)          499        (37,0)
        160.       Net provisions for risks and charges                                                (2.875)                                (2.875)           (3.258)                                                                          (3.258)          383        (11,8)
     210. + 240.   Profit / loss from sale of equity investments                                        1.296                                  1.296               (76)                                                                             (76)        1.372          n.s.
                   Profit / loss from continuing operations' income before taxes                     118.930              3.869             122.799           201.597                          -                       -                 -     201.597       (78.798)       (39,1)
         260.      Income taxes for continuing operations' current                                    (46.951)           (1.064)             (48.015)          (71.893)               (2.767)                 (3.118)                           (77.779)       29.764       (38,3)
                   Integration costs                                                                          -                   -                 -             (732)                        -                       -            732                -             -               -
                   of which: staff costs                                                                      -                                     -             (597)                                                             597                -             -               -
                          Net adjustments to tangibles and intangibles                                        -                                     -             (441)                                                             441                -             -               -
                          taxes                                                                               -                                     -              306                                                             (306)               -             -               -
        290.       Operating profit                                                                   71.979              2.805              74.784           128.973                (2.767)                  (3.118)               732        123.819       (49.035)       (39,6)




36
Information on the group balance sheet

Premise
On 25 January 2010 and 'was finalized the optimization of the Territorial
Gruppo UBI Banca, which led to the Bank for the sale of 28 branches located in the
territories of other defense companies - Banca Popolare di Bergamo, Banca Popolare
Commercio e Industria, Banca Regionale Europea and Banco di San Giorgio - acquisition of
37 branches with its location in the provinces of reference. The figures at 31 December 2010
reflect the effects of this operation, therefore, are not perfectly consistent with the
comparative data.




Loans and bank overdrafts
The interbank position, net of transactions in repurchase agreements made with the Parent
Company for collection in repurchase agreements from customers, recorded a significant
decline from a positive balance of 5708 to a negative balance of 2.999 billion euro.
The aggregate is influenced mainly by the following factors:
    - Early repayment of debt related to the policy of structural balance (1,100 million euro)
         with a consequent increase in debt on the interbank account held with the parent
         company;
    - the active end of deposits for about € 700 million (around EUR 500 million related to
         the above policy);
    - optimization of the operation area, which created an imbalance in the interbank
         debts of the business for about 291.8 million euro;
    - assignment of the Luxembourg branch that led to a reduction in deposits assets for
         approximately € 5.6 billion related to the ECP and CD collection in France.


(In thousands of euro)
                                                               Change in December                           Change in December
                                                                     '10 / Dec. '09         31/12/2009            '10 / Dec. '09
                                 31/12/2010     31/12/2009
                                                                Absolute       %              restated       Absolute       %
Loans to banks                      851.391       7.442.072     (6.590.681)        (88,6)     1.464.430        (613.039)        (41,9)
Due to banks                      3.341.564       1.370.705      1.970.859           n.s.     1.326.245        2.015.319          n.s.
        Net interbank position    (2.490.173)     6.071.367      (8.561.540)         n.s.        138.185      (2.628.358)         n.s.
(-) Repurchase                      (508.723)      (363.323)       (145.400)        40,0        (363.323)       (145.400)        40,0

Net interbank position           (2.998.896)      5.708.044     (8.706.940)          n.s.      (225.138)     (2.773.758)          n.s.




Loans to customers
The total loans to customers stood at an altitude of € 15.078 billion, an increase of 899
million (+6.3%) compared to the size of the end of 2009.
Net impaired assets, loans, representing 59.4% of total loans (58.7% at December 31, 2009),
show an increase of 6.4%, as well as the technical forms in the short term, growth 9%.

The operation optimization of land led to an increase of the masses of about
553 million €.




                                                                                                                                         37
Situation of loans to December 31, 2010
(In thousands of euro)

                                                                Exposure             Value adjustments      Exposure
                      Type of exposure / values
                                                                  Gross                      Total             net


a) Bad debts                                                               346.843                161.931          184.912
b) Substandard                                                             351.197                 32.529          318.668

c) Restructured                                                            214.801                 13.302          201.499

d) Expired exposures                                                        42.421                  1.400              41.021
                                         Total non-performing
                                         loans                         955.262                   209.162          746.100

e) Performing loans                                                  14.399.556                    67.452       14.332.104

TOTAL                                                               15.354.818                   276.614       15.078.204



Situation of loans to December 31, 2009
(In thousands of euro)


                                                                Exposure             Value adjustments      Exposure
                      Type of exposure / values
                                                                  Gross                      Total             net


a) Bad debts                                                               268.590                136.315          132.275
b) Substandard                                                             280.583                 29.794          250.789

c) Restructured                                                             81.134                  8.210              72.924

d) Expired exposures                                                        77.447                  1.439              76.008
                                         Total non-performing
                                         loans                         707.754                   175.758          531.996

e) Performing loans                                                  13.697.109                    50.364       13.646.745

TOTAL                                                               14.404.863                   226.122       14.178.741




The Bank's net non-performing loans amounted to 746.1 million euro, grew by 40.2%
compared to December 31, 2009, as a result of the continuing economic crisis and the trend
of increasing credit risk.
In detail:
           the non-performing loans amounted to 184.9 million euro, increased by 39.8%
           compared to the previous year, and their relationship to the total loans is equal to 1,
           2%;
           problem loans have increased from 250.8000000 to 318.7000000 euro, as well as
           restructured loans past 72.9000000-201.5000000 euro for the entry of some major
           counterparts;
           decline in the past due exposure, 76 to 41 million euro, including about 35 million €
           to intrude between 90 and 180 days for exposures secured by real estate, among the
           reclassified as impaired under the rules of supervision for banks that carry out the
           supervisory information in accordance with the standard method (55.5 to 31
           December 2009).

The level of coverage of the suffering is 46.7%, down compared to year-end 2009 (50.7%), as
well as the level of coverage of problem loans amounted to 9.3% (10.6 % at December 31,
2009).
The allocation of general reserves of the Bank (67.4 million euro) is a level of recovery of
loans bonis equal to 0.47% (0.37% at December 31, 2009).


Financial assets
At December 31, 2010, financial assets amounted to € 207.5 million, compared with 237.3
million at the end of 2009. The components have the following dynamics:
       "financial assets for trading amounted to 100.9 million euro, down 11, 6% and are
          mainly fair value positive derivatives

38
        trading. Excluding the foreign subsidiaries at December 31, 2009 (5.8 million euro,
        of which Lehman shares for € 517,000), the item shows a decrease of 6.9%;
    "financial assets available for sale" are past 26.3000000-20.9000000 euro. The
       decline amounted to € 5.4 million, is attributable to measurement at fair value of its
     stake in Intesa S. Paul,
  the "hedging" amounted to € 45.5 million against 75.1 at the end of 2009;
    the 'Fair value of financial assets in hedged "with an increase amounting to a
       positive € 40.2 million against 21.6 at the end of the previous year and represents
       the fair value of loans to customers covered "macrohedging". The increase is to be
       assessed together with the results shown in item 60 of the passive "Hedging
       derivatives" which includes, for about € 44 million, the valuation of the derivative to
       cover the loans (17 million euro more than in December 2009). The growth is mainly
       attributable to the significant reduction of interest rates in the medium and long
       term that resulted in a significant appreciation of the fair value of fixed-rate
       mortgages.


Investments
The only include interests in group companies.
As a result of the optimization area, the Bank has subscribed to newly issued shares of
Banca Popolare di Bergamo, National Bank of Commerce and Industry, European Region of
the Bank, and Banco di San Giorgio, against transfer of the business, for total
approximately € 32.9 million. They were then transferred to the parent company in July.
The holding in UBI Banca International SA has increased (+2.9 million Euros) by the
operation of the conferral of Luxembourg Branch, 31 December 2010 amounted to EUR 5.2
million and represents 5.85% of the capital.
The existing equity at beginning of year in UBI Sistemi e Servizi ScpA and Bank of
Vallecamonica are unchanged.


Customer deposits

At December 31, 2010, the Media administered score amounted to 33.0143 billion euro,
down (-17.5%) compared to 2009 (-4.1% compared to 2009 restated).

Assets under management
(In thousands of euro)
                                                                               Change in December                            Change in December
                                                                                     '10 / Dec. '09          31/12/2009            '10 / Dec. '09
                                                 31/12/2010     31/12/2009
                                                                                 Absolute       %              restated       Absolute     %
Direct customer:                                   12.118.973     19.171.160      (7.052.187)       (36,8)      13.542.302   (1.423.329)       (10,5)
                             Due to customers       8.885.718      8.870.849          14.868          0,2        8.607.554      278.164          3,2
                             Securities issued      3.233.256     10.300.310      (7.067.055)       (68,6)       4.934.749   (1.701.493)       (34,5)
Indirect customer deposits                         20.895.362     20.866.197          29.165          0,1       20.866.197        29.165         0,1

TOTAL ADMINISTERED CASH CUSTOMERS                 33.014.335      40.037.357     (7.023.022)        (17,5)     34.408.499 (1.394.164)           (4,1)




Direct deposits
The consistency of the direct deposits amounted to 12.119 billion euro, a decline from the
figure recorded in 2009.

Amounts due from customers amounted to 8.8857 billion euro, increased by 15 million
(+0.2%). Connected to the net operating foreign operations, the figure was a growth of 3.2%
mainly due to transactions in repurchase agreements.

The securities issued have passed 10300.3000000 to 3233.2000000 euro, dropped
significantly. Please note that the 2009 figure included emissions from the branch


                                                                                                                                                  39
Foreign certificates of deposit and Euro commercial paper (approximately 5,200 million
euro) and a subordinated deposit formed at the same branch of the Preferred Capital
Company LLC (Delaware - USA) for a total of 165 million euro. Excluding these items that
securities issued with a decrease of 32.5% mainly due to early repayment of debt signed by
the parent company and aimed at rebalancing of assets and liabilities of the Bank (-1.1
billion euro).

The process of optimization has led to land an overall increase of approximately 201.2
million euro under the direct customer, and approximately € 23.7 million of shares in
circulation, the latter represented mainly by certificates of deposit in foreign currency.


Indirect funding
(In thousands of euro)

                                                                                                  Change A / B
                                 31/12/2010      Incidence     31/12/2009      Incidence
                                      A               %             B              %
                                                                                             Absolute            %


- In Administration                 7.280.289           49,0      6.812.190          47,9       468.099               6,9
- Asset management                  7.569.509           51,0      7.413.028          52,1       156.481               2,1
     Portfolio management            1.318.288           8,9       1.224.147           8,6        94.141              7,7
     Mutual Funds and Sicav          3.048.612          20,5       3.141.826         22,1        (93.214)            (3,0)
     Insurance products              3.202.609          21,6       3.047.055         21,4        155.554              5,1
PRIVATE CUSTOMERS                  14.849.798          100,0     14.225.218         100,0       624.580               4,4

- In Administration                  3.270.515          54,1       4.130.212         62,2       (859.697)        (20,8)

- Asset management                   2.775.049          45,9       2.510.767         37,8        264.282             10,5
INSTITUTIONAL CLIENTS               6.045.564          100,0      6.640.979         100,0      (595.415)             (9,0)

TOTAL INDIRECT DEPOSITS            20.895.362                    20.866.197                       29.165              0,1




Indirect funding overall, the market value, amounted to 20.895 billion euro, in line with the
amount of the end of 2009.

With reference to individuals, indirect funding administered stood at 7.2803 billion euro
(+6.9%), positively influenced by the contribution of debt securities issued by the parent
company, for a total nominal value of around 422 million euro, as well as third-party
obligations of approximately EUR 457 million.

Growth (+2.1%), including assets under management amounted to 7.5695 billion euro,
mainly thanks to the savings insurance fund, which stood at 3.2026 billion euro, an
increase of 5.1% compared to year-end 2009. During 2010 were placed insurance products
to approximately 803 million euro.

Decline in indirect funding from institutional clients (-9%).

The sector has affected the operation of local optimization with a net flow of indirect
administrative fee of approximately € 650 million and assets under management of
approximately EUR 200 million.


Shareholders' equity

As a result of the optimization area, the Bank has issued 32,841,516 new shares against
contribution of the business by Banca Popolare di Bergamo, Banca
Popular Commerce and Industry and the European Regional Bank.

Shareholders' equity at December 31, 2010, net profit for the period amounted to EUR 71
million, shows a balance of 1,388,100,000 (+19.9% compared to December 2009). The
increase is attributable mainly to the increase of share capital (22.3 million), the allocation
of reserves in 2009 (94.2 million) and the switch from positive reserve (120,900,000); the


40
valuation reserves established in the period, a reduction of shareholders' equity of
approximately EUR 7 million.

For more detailed information please refer to the appropriate "Statement of changes in
equity."




                                                                                         41
About the reclassified income statement

The Net interest income 31 December 2010 amounted to 325.8 million euro, a decrease of
7.8% compared to the previous year, due mainly to the dynamics of the rates in partially
mitigated by the volume traded. The decline in profitability has focused on the technical
forms in the short term.

I Dividends amounted to EUR 1.2 million and represent the return of the shares in Bank of
Vallecamonica, UBI Banca Intesa and International S. Paul.

The Net commissions amounted to EUR 196 million, down 2.1% from December 31, 2009.
The decline, which affected, in particular, the fund accounts and placing third-party
products was partially offset by strong performance of the asset management and
administration fees, the latter supported by the placement of bonds of the Parent ( 7 million)
and third-party obligations (12.1 million).

The trading and hedging has produced a loss of about 1.5 million euro, compared to a
positive € 10 million a year earlier. The main components of this result are as follows:
         negative impact of the coverage of fixed-rate loans for a total of 5.9 million. This
         effect was mainly generated by the phenomenon of prepayments, defaults and
         renegotiations, which led to the 'unwinding related hedging derivatives assets, whose
         effects are reflected in Item 80 12300000; evaluating loans to cover on Dec. 31 has
         generated profits for EUR 6.3 million, entered in Item 90. In the previous year, the
         impact of hedging the mortgage was a loss of 5.9 million, due almost entirely to an
         assessment;
     ·   the assessment of collateral for bonds has generated profits of 1.6 million members
         under 90, against 9.1 million the same period in 2009, the contraction of the result
         is due to changes in yield curve, which has presented considerable rise for short-
         term maturities;
     ·   the repurchase of financial liabilities have generated losses of € 56,000, entered in
         item 100, compared with € 139,000 at 31 December 2009.

The Other net operating income amounted to € 14.8 million against 20.7 for the same
period 2009. The decline can be attributed mainly to lower recovery of expenses from
ordinary customers.

As a result of these dynamics, Operating income share stood at 536.5 million euro, a
decrease of 8, 5% from last year.

In terms of costs, "Staff costs " amounted to 172.8 million euro, an increase of 5.1%. During
2010 it was registered as a non-recurring costs for incentives under the Agreement of May
20, 2010 Auditors, amounting to € 3.9 million, net of this component, the staff costs are an
increase of 2.7%.
In detail, the main increases relate to the evolution of organic (ie average more than 43
resources, including as a result of the optimization area) with an economic impact of
approximately EUR 4.5 million and that earnings for 2 , 9 million euro (Negotiable
increments, seniority shots, drag effect of career advancement in the previous year), the
main reductions are attributable to lower accruals for the company bonus and incentive
systems for about 6.2 million €.

The "Other administrative expenses"Amounted to 133.3 million euro, a decrease compared
to December 2009 (-0.9%). The main cost savings are found in the segments "owned
property", "Rent", "insurance premiums" and "postal." Growth in the sector "telephone and
data transmission" due to higher costs for joining the

42
System of guarantees intended to cover damages caused by the fraudulent use of cards.
Please note that the 2009 figure included € 1.1 million of costs relating to the securitization.

The Value adjustments on tangible and intangible assets are approximately 11 million €.

Overall, operating costs, amounted to 317.3 million euro, +2.1% over the same period 2009.
The cost / income, Calculated by dividing operating costs to operating income is 59.1%
(58.4% excluding non-recurring events).

As a result of these trends, the Operating margin totals EUR 219.2 million, net of non
recurring events to stand at 223 million.

Adjustments / write-backs on loans increased from 69.2 to € 97.9 million, 77.2 million
analytical adjustments to loans non-performing (59 million out-performing loans) and 20.7
million collective impairment losses on loans bonis. For more details, please refer to the
explanatory notes to the Accounts - Section 4 - Other Aspects. The cost of credit amounted
to 0.65% (0.49% at December 31, 2009).

The adjustments to / recoveries on impairment of other assets / liabilities, show a loss
amounting to 849 000 €. Involves the evaluation of credit commitments, which amounted to
€ 1,130 million with a coverage level of 0.38%, and the assessment of commitments, which
amounted to 1,137 million euro, with a coverage level of 0.02%.

The Net provisions for risks and charges decreased from 3.3 to 2.9 million euro. The trend is
justified by the release of excess funds and lower provisions for revocation actions which
have partially offset the increased funding for lawsuits related to compound interest and
financial investments.

Profit before tax totals € 118.9 million, net of non-recurring income amounted to around
122.8 million euro.

The sale of equity investments generated a profit of EUR 1.3 million euro, thanks to gains
from the alienation of certain property.

The taxes amounted to € 46.9 million. The tax rate is equal to 39.5%, against 35.7% in the
same period 2009. The tax rate standard is equal to 39.1% against 38.6% in 2009.

Net period amounted to EUR 72 million. Net of transactions not applicants, the result
amounted to € 74.8 million.

In relation to the trends described above, the economic management of the Bank shall
deliver an ROE (Return on Equity) Equal to 5.19%, down from 11, 14% figure at 31
December 2009, the normalized ROE is equal to 5.39%.

At December 31, 2010, due to changes in valuation reserves, overall profitability stood at 65
million euro, against 132.2 million at December 31, 2009.



                                                   *****




                                                                                                   43
The research and development
A summary of the main design developed in 2010 by the Management Innovation and
Design Architecture of the Parent. They include, in some cases the evolution of activities
already set in the previous year, in others, new projects launched in the year. These
initiatives do not necessarily arise from business needs but, inspired by the evolution of
technology, we are studying the possible application for the benefit of improved efficiency
and effectiveness of business processes, and in relations with customers.

Within the project "Unified communications" (Integration between phone and workstation
PCs), which began as early as 2008, in parallel to complete the activation on the perimeter
Parent Network Banks and Voip Platform18, The activities were geared towards the
implementation of tools for Web collaboration19 to share documents and applications.

As for the systems videoconferencingIn 2010 was completed the expansion plan of the users
within the group - with about 300 workstations installed a total of nearly 50 webcam
integrated into the same workstation (PC) - in parallel with the improvement of quality
solutions through the introduction of high definition (HD). This technology has indeed
confirmed the strong support decision making and information sharing, as well as an
enabler to reduce time and costs associated with the movement of people.

The project "New workplace" - Directed, as a first scope, simplification and efficiency of
activities related to the provision of loans to retail customers - has seen the completion of
the first phase with the activation of a document management platform with the goal of
dematerialization (paperless), Which became operational in January 2011. At the same time
was launched the second phase aimed at developing solutions for the integrated
management of digital signature, electronic storage and certified mail.

New paradigms Mobile Internet and Application Store are making increasingly clear the
potential of mobile phones to the provision / content and use of banking services. It was
therefore carried out the study and development, in synergy with products of
Enjoy card, enabling an application to the Home Banking services20 the most common
mobile terminals. The service, already successfully operating systems on the iPhone and
Android, in 2011 will also be extended to BlackBerry and Nokia.

Among the most recent technological innovations, was carried out an evaluation platform
iPad to assess its potential for application across the enterprise. It led to a Its first practical
application as support to top management for managing and sharing documents in the
Board meetings and various committees. Developments in optical document solution
provides, at a later time, a more detailed user profiling and possible integration with the
corporate document management system.

The need to combine on the one hand the Group's attention to the high security area in
Home Banking, and secondly, the needs for operational user customers have also led to the
first trial of a new instrument for the certification and validation operations of the device,
alongside the current system based on the use of identification codes.




18   Technology that allows you to make a phone call using an Internet connection.
19
  Enabling technology for collaboration over the Internet in real time both inside the company and assistance to
customers.
20   Excluding the operations of securities.
4
Contracts with Group companies
In accordance with Circular No. 262, December 22, 2005 issued by the Bank of Italy, I °
Update November 18, 2009, and in accordance with IAS 24, the commentary and
information on financial transactions with Group companies and related parties has been
included in Notes, Part H, to which we refer.




                                                                                          45
More information
The statutory changes
During the year the changes were approved statutes designed to provide opportunity, in
accordance with the provisions of Art. 2397 cc, three instead of five mayors, in order to
bring coherence to the number of members of the Board of
Bank with the overall structure of corporate governance of the Group.
Also approved was the amendment of the bylaws concerning increase in capital (Article 5)
approved by the Extraordinary 11 January 2010 to serve the duty of the business operated
by Banca Popolare di Bergamo, Banca Popolare
Commerce and Industry and the European Regional Bank for the benefit of the Bank.


Information on shares of Parent and art. 2428 cc.
It is noted that the Bank has not carried out in respect of the securities portfolio, buying
and / or sale of treasury shares, or shares of the parent and at year end did not hold
treasury or treasury shares or shares of the parent.


Tax Aspects
Summary of news for the year
In terms of the fiscal year 2010 was characterized by limited legislative action on the
activities of the Group. It should however be remembered as the banking system has
repeatedly called for action on:
     ·   abuse of tax law, specifically with regard to restructuring / reorganization or to
         transnational financial transactions;
     ·   criteria for IRES and IRAP tax deductibility of bad debts;
     ·   taxation of financial instruments;
     ·   VAT treatment of intercompany transactions;

and more generally the significant burden of tax for banks and financial intermediaries in
relation to the arrangements in place for other EU countries. Another aspect critical to the
industry is due to the application of IAS / IFRS which is not followed by an effective
framework for fiscal side.
For connection of argument points out the peculiarity of the Italian tax system to generate a
relevant entry in the budget of the cd deferred tax assets. This element in the near future
(Basel 3) will be considered for the negative component of shareholders'
Surveillance; in D.L. No 225/2010 (so-called "thousand extensions") - converted by Law No
10 of 26.02.2011 - is anticipated that the main case of deferred tax assets
(Doubtful debts / intangible assets) are transformed into a tax credit if the individual
financial statements of the bank is taken over a loss. This forecast is intended to ensure
that these deferred tax assets are not classified as negative components of regulatory
capital.

New VAT compliance
By Decree Law No. 40/2010, converted into Law 73/2010, were introduced more character
signaling charges against those taxes. In particular, it is necessary - to make time from 1
July 2010 - report transactions and receipts in respect of economic operators established,
residence or domicile in the states to tax havens
(DD.MM. May 4, 1999 and November 21, 2001). The reporting obligation covers operations
on or after 1 July 2010. The report should be submitted with monthly or quarterly
depending on the amount of operations in the past four quarters (or less than 50 000 €).
Circular No 53 / E 21 October 2010 the Inland Revenue has made clear that those involved
in the financial sector, and even more so when adopting the rules in art. 36 bis of
Presidential Decree 633/1972, the communication must be solely on the VAT taxable
lending, staying


46
therefore not all passive activities, as well as credit transactions exempt, non-taxable and
exempted from VAT.
Still, with the D.L. 78/2010 converted into Law 122/2010 was introduced, to make time
since 2010, the obligation to report electronically to the Revenue in the operations relevant
to the VAT amount not less than 3,000 €. The measure affects all taxpayers for VAT
purposes with regard to supplies of goods and services supplied and received.
Communications must take place no later than 30 April following the reference year: for
2010 alone, the claims must be made within the next October 31, 2011.
Regarding the banking sector are expected exclusions with regard to data already
nell'Anagrafe Tax (eg account relationships with customers).

Relations with non-residents - Transfer price
The Decree Law No. 78/2010, converted into Law 122/2010, has introduced special
procedures to prevent resident companies that have relationships with foreign subsidiaries
to the application of any tax penalties related to violations relating to the determination of
tax cd "Transfer pricing" (Article 110, paragraph 7 of the Income Tax Code).
Following the Order of the Director of the Inland Revenue issued on September 29 pursuant
to the above standard, the Internal Revenue Service Circular No 58 / E of 15 December
2010 has provided the necessary clarifications operational. In summary were presented the
contents of the documents that it deems necessary in order to receive exemption from
sanctions in case of investigation: they are represented by Masterfile and
Papers. While the former is attributable to information on the Group, the second covers the
individual company. Given the fact that sending such documentation is optional and that
the transactions with its foreign counterparts of the Group are, at present, essentially
limited to financial transactions, the responsible office of the Parent Company are
responsible for identifying the most appropriate valuation models and intra-group
comparison of prices in line with the OECD Guidelines complex on 28 July 2010 and whose
results will be used in each case as proof of proper intercompany pricing.
In general, companies operating subsidiaries / foreign parent companies expect the tax
authorities reviewed by way of simplifying the formalities required at least according to the
magnitude of transnational relations.

The tax dispute
With reference to the verification carried out in 2009 by the Inland Revenue - Direction
Regionale per la Lombardia - Large Taxpayers Office, 2006 recall that for the annual audit
report in the process (cdpvc), have been highlighted findings - mainly due to the bad debt
riquantificazione tax deductible for higher taxes amounting to € 1.9 million and an alleged
failure to carry out restraint € 1.6 million as withholding tax on interest paid by the Banco
di Brescia through its subsidiary in Luxembourg with Banca Lombarda Preferred Capital
Company LLC, as part of a cd "Preference share". The Bank having made its comments, as
required by the Statute of the taxpayer (Law No. 212/2000), arguing to the contrary to the
findings in the aforementioned PVC, it has received from
D.R.E. Lombardy on December 22, 2009, for the year 2004, a notice of assessment that
incorporates full pads in pvc with regard to the alleged failure to carry out restraint with
respect to interest paid in 2004. Against that finding of fact was presented in early February
2010 appeal to the competent
Provincial Tax Commission. Provisions to Ensure the estimated risk with regard to
allegations concerning the loans, amounted to EUR 1.25 million.
Please note that November 4, 2010 was notified to the Company for payment for the
collection folder provisional pending trial more than 50% of withholding taxes and related
interest, for a total of € 0,950,000, which is regularly paid on December 30 2010.

Also on the basis of p.v.c. mentioned above, the December 20, 2010 D.R.E. Lombardia
notified, for the year 2005, a tax assessment for the same operation

                                                                                                 47
c.d. "Preference share" mentioned above, therefore, with regard to the alleged failure to carry
out in respect of deduction to interest paid in 2005. Against that finding of fact was
presented in early February 2011 appeal to the competent Provincial Tax Commission.

Regarding the assessment notice served on 29 May 2009 - following the test already
completed in prior years related to the year 2004 with regard to IRES, IRAP and VAT - which
increased IRES and IRAP, for a total of about 1 € 7 million, the Bank has produced timely
appeal to the competent Provincial Tax Commission, like UBI Banca Scpa well addressed in
that assessment as the successor of the then consolidating (the tax consolidation regime in
art. TUIR 117-129) Banca Lombarda e Piemontese SpA
Hearing on December 13, 2010 has been prepared to the meeting of the Banco di Brescia
and actions of the parent company which is still pending determination of the further
hearing of appeals for the meeting.
With reference to the act of correcting the above-mentioned statement consolidating Bank
Lombarda e Piemontese (IRES increased approximately € 1.9 million, of which € 1.5 million
attributable to the Company), given the joint responsibility of the Banco di Brescia to the
extent of referring to it more IRES, October 22, 2010 was served on the Banco di Brescia
folder provisional payment for the collection of proceedings of 50% of the total increased
IRES and interest, for a total of € 1.17 million. Having been notified also similar to the
parent folder UBI Banca (as the successor of consolidating Banca Lombarda e Piemontese),
the latter has paid the amount indicated, by charging the Banco di Brescia, the share
attributable to it (€ 901 000). Faced with this litigation remain unchanged reasonable
provisions made in prior years.

Finally, remember that the Banco di Brescia - are among the so-called Major Contributor
pursuant to art. 27, paragraphs 13 and 14, D.L. 185/2008, as supplemented by Order of
the Director of the Inland Revenue No 54291 of April 6, 2009 - is subject to more stringent
checks by the financial authorities as well as the so-called tutoring tax (Article
27, paragraphs 9-12, D.L. 185/2008), according to the addresses known, will help provide a
constant and control the operation of the large taxpayer.


Action    sanctions against the decision of the Italian
Competition




The collective agreement of 20 May 2010

For updated information of the previous budget, it is stated that on October 23, 2010 the
Council of State dismissed the appeal of the Italian Competition Authority, has permanently
canceled the penalties imposed by the 23 banks in 2008, the theme of contention was the
alleged irregularities of operations adopted by the Bank on the transfer of mortgages,
irregularities, the State Council decided not to exist.
With the reimbursement by the Ministry of Economy and Finance, at the time paid the
penalty and statutory interest you close the dispute.
The collective agreement of 20 May 2010
On May 20, 2010 ended the union steps to achieving a significant reduction in costs and in
particular the cost of structural work.
The Framework Agreement Group - signed by DIRCREDITO, FABI, FIBA / CISL, FISAC /
CGIL, UGL Credit, UIL.CA, and SINFUB FALCRI - noted the urgent need to implement a cut
in costs at a consolidated level, through a reduction in staff and their unit cost, supported at
the operational level, cross-adoption (for all companies) with appropriate management and
organizational measures to promote efficiency gains and productivity.


48
The plan for voluntary redundancies has affected all employees became entitled to receive the
pension before December 31, 2011.
The voluntary allowed to cover received almost totally objective, without recourse to the activation of
the Law 223/1991 provided dall'Accordo21. The banks and companies have contributed jointly to the
objective of the Group, accepting the applications received so far in excess of the quota fixed for each
individual company and bringing them to compensation where numerical targets were not fully
achieved.
The first group of outputs occurred at the end of June, with effect from 1 July, the remaining effective
after 1 July 2010, for a total of 74 resources.
The total cost of operation for the Bank, amounting to 3.9 million euro, which has been declared non-
recurring event.
Posts territorial articulation of the Group
On January 25 has been completed the optimization project that involved territorial Banca Popolare di
Bergamo, Banco di Brescia, Banca Popolare Commercio e Industria, Banca Regionale Europea and
Banco di San Giorgio, with the aim to better focus the activities of these banks in their respective
geographical areas in which, by grouping together under a single brand of branches on the same
territory. As a result of what the retail banks are currently operating with a single brand in 72 of the 78
provinces where they operate. Technically, the project involved the transfer of intercompany transfers
of 316 branches across 14 business units. In the month of July, then occurred the restoration of the
original shareholding structure of UBI Banca (the repurchase of minority interests acquired by each
crossed Bank Network as a result of subscriptions).
Interventions sull'assetto Bank's International
With effective date December 10, 2010 has finalized the assignment of the Luxembourg branch of UBI
Banca International SA The operation is part of the plan of reorganization and strengthening of the
international structure of UBI Banca Group, with the aim of streamlining the group's presence on the
square in Luxembourg by the aggregation between two entities that operate with a high degree of
integration .Under the agreement, Banco di Brescia increased participation already held in 3002 UBI
Banca International subscribing to shares of the transferee for a total of 2.9 million euro. Participation
entered on the balance sheet at 31 December 2010 amounted to approximately EUR 5.2 million
(5.85% of capital). The contribution from realized gains, was included in equity in accordance with the
guidelines Preliminary Assirevi (cd OPI), in analogy to the methodology adopted for wider territorial
operation optimization, and amounted to EUR 1.9 million net of the related taxation.
Business Process Reengineering (BPR) Loans
Business Process Reengineering (BPR) Loans is a project initiated in the second half of 2009 with the
aim of improving the effectiveness and efficiency of the process of the Bank Group's network, in
particular by responding to the dual need to reduce the one hand response times to customers and
secondly, to simplify the administrative burden on operators, without loosening the garrison of credit
risk.
The project was developed along the following lines: excellence in response time to customers, while
maintaining an adequate risk management of credit among the interventions redistribution of
workloads between central and peripheral organs through the increase in the bodies deliberating
21 The completion of the redundancy scheme was implemented for 500 people taking up to
competition, termination of employment of senior staff have the right to retire and that he had
voluntarily adopted the Plan, by application of the legal andcontract on          49
           With
            · activation of a single procedure for applying for the enforcement of real estate
                valuations by external specialized companies;
            · the centralization of processing mortgage securities at UBI.S, aimed at reducing
                the manual tasks of an administrative burden to operators involved in the
                improvement of safeguards;
           the introduction of an index of abnormality for Counterparty - IAC: Calculated
           automatically a mechanism of progressive aggregation phenomena weighted anomaly
           detected at the level of Bank Network on each party allows, in combination with the
           internal rating, to produce recommendations for early interventions; Delinquency
           Management. The project aims to preserve / protect the customer relationship
           through the timely resolution of irregularities credit (installments in arrears / overdue)
           recognized on the performing score, individuals and small businesses through direct
           support offered to the operator of the report by a specialized structure centralized
           operational by June 2010 at UBI.S ;
           The new model credit recovery. In order to improve efficiency of a generalized
           processes and structures involved in the activity was completed at the decentralization
           of the management of the network banks classified their customers, "Grounding in
           return"22, Previously managed in service facilities to the parent company. It was also
           created a special structure called "Service quality loans," seen in the context of the
           area of parent company debt, among others, the tasks of overseeing the processes of
           recovery, supporting the banks in the restructuring of debt, monitoring of loan
           portfolio abnormal group and supervisory processes and instruments related to the
           model
           "Arrearage management."


The project objective simplicity "
The project "Objective Simplicity" was born with the aim of identifying solutions to improve
service and responsiveness to customers on products and services identified as priorities,
streamlining processes and tools to support activities carried out by the commercial
network.
The main areas where action was taken:
        · simplification of procedures for the sale of the main products of the current account
            and investment through the integration and automation of the compilation and
            printing of all necessary forms and reducing the number of signatures required for the
            signing of contracts;
        · response times on a mortgage loan to individuals, with the introduction of a
            commercial offer condition, aimed at informing the customer of the feasibility of the
            operation within 48 hours after delivery of the documentation on the basis of income
            evaluation criteria defined in advance;
        · the revision of the autonomy of the branches of larger commercial / business volumes
            in order to increase the speed of customer response on requests for rate changes and
            conditions;
        · the activation of a defense specialist "Delivery Management" for the entire life cycle of
            payment card placed by the retail banks, enhancing delivery, minimizing delays and
            supporting the network management of anomalies;

22Are considered "Substandard return to" those positions for which was provided for the total withdrawal
  (Depreciation exposures, exposures to which must be a formal repayment plan with a duration exceeding 12
  months, which shows that even in the absence of a repayment plan, they are still subject to gradual reduction).
  They therefore differ from so-called "operational Substandard" which apply to positions for which the resolution is
  expected in the short term the temporary position of difficulty and for which it is permitted operability controlled
  in order to mitigate the risk and return the report "in performing "or repayment plan with less than 12 months,
  belong to this category, the opposing parties for which it is being drawn up a restructuring plan with a duration
  longer than 6 months (during the" Stand-Still ").

50
    · continuous improvement in response times and service levels available to the Network
        Help Desk, through initiatives aimed at developing the analysis of internal needs, the
        actions of support, training and updating the "technical training" and " behavioral
        resources Help Desk, as well as increased site information available to the network;
    · optimizing the management of the internal legislation of the Group through a
        reclamation and rationalization of the existing regulatory body, to simplify the process
        of drafting and adoption of new production and the introduction of an advanced front-
        end consultation available to the Network


The renewal of the partnership in bancassurance life
On September 30, 2010 and UBI Banca Cattolica Assicurazioni have finalized the agreement
to renew the partnership in life insurance due to expire at year-end, extended until
December 31, 2020. The agreement, signed July 29, provides for the distribution of
insurance joint venture Lombarda Vita, exclusive character, through the branches of the
network banks of the former Banca Lombarda Group (Bank of
Brescia, Banca Regionale Europea, Banca di Valle Camonica, Banco S. George).

In this perspective, the partnership has been strengthened with the sale by the UBI Banca
Group by a further 9.9% stake in the joint venture to Catholic Group
Insurance. Following the completion of the share capital of Lombard Life is so held as to
60% of Cattolica Assicurazioni (compared to the previous 50.1%) and 40% by Gruppo UBI
Banca (49.9% compared to the previous ).



Interventions "Anti-crisis" in support of small and medium-sized enterprises23 and
families
During the year the Group's banks have set up a series of interventions to support families
and the realities of their economic and productive areas of reference, working with public
institutions (Chambers of Commerce, Regions and Provinces), and with public bodies
Warranty24.

Banks of the Group thus continued the activities undertaken since 2009 to support families
and small and medium enterprises in their respective territories on the basis of active
interventions both locally and nationally.

With regard to assistance to SMEs, the Group, he promptly joined in August 2009 to the
'Joint Notice "or to the' Agreement for the suspension of debts of small and medium-sized
enterprises to the banking system" 25 (And subsequent additions) signed by the Ministry of
Economy and Finance, ABI and other organizations of the Observatory Banks and
Enterprises, has also joined in June 2010, the extension of



2  As defined in the legislation are considered small businesses entities engaged in economic activities, irrespective
3
  of legal form, employing fewer than 250 people, with annual turnover not exceeding EUR 50 million or total
  assets less than € 50 million.
   For companies reporting, in particular, a number of facilitative tools in the UBI has joined such example,
2
4
  interventions in the Piedmont Region for Innovation of SMEs, to support energy efficiency, for the support of
  companies in the tourism sector, as well as measures to assist agricultural enterprises (management and
  mechanization), in the Lombardy Region interventions to support innovation-oriented business activities, the
  inclusion of new technologies and competitive development, and expenditures for the needs of businesses
  operate agricultural interventions in the region of Calabria for debt consolidation in the short term, to support
  investment and for the improvement and expansion of facilities. It also noted the start of operations in support of
  agricultural enterprises to rely on the Rural Development Programmes 2007-2013 in some regions also on the
  measures to provide interest subsidies.
25 The agreement, made operational Sept. 28, 2009, provides for SMEs who are in temporary difficulties but that
  appropriate financial counter the economic outlook and business continuity, the ability to benefit from four
  measures: i) suspended for 12 months of the principal portion of loan installments ii) suspension for 12 or 6
  months for the principal amount of the fees of operations leasing of real estate or securities, respectively; iii)
  elongation at 270 days of the maturity of bank loans on short-term iv) provision of special funding aimed at
  supporting the strengthening of the capital.

                                                                                                                    51
deadlines for submission of applications by companies until January 31, 2011, thus
postponing the seven months the original deadline of June 30, 2010.
In late December, were made to the Group than 14,800 applications - mainly due to
medium / long term - for a total of 4.3 billion euro, of which over 13,000 have already
improved, in the amount of share capital amounted to 520 suspended million euro. The
applications having the required eligibility requirements have been accepted for almost all.

As regards, in particular, the offer provided by the Agreement of measures to strengthen
financial position of SMEs, the Group has continued to offer a line of credit 200% immediate
Recapitalization, which provides funding equal to two times the increase of capital actually
paid by the shareholders of the company, up to a maximum of EUR 4 million.

The supply of commercial banks in the Group also provides the following two additional
lines of credit backed by collateral of the major consortia agreement, which have better
features than in terms of the agreement:
     · "400% Support and Development, funding of up to four times the equity injection by the
         shareholders of the company (for a maximum of 500 000 €) to support growth plans
         through the implementation of fixed investment;

     · "200% Increase in the capital structure, financing for an amount to double the capital
         injection by shareholders of the company (corporation, persons or businesses), for a
         maximum of 1 million €, aimed at supporting processes of rebalancing capitalization and
         sources of financial firms. The disbursement of these funds is also foreseen in case of
         delayed payments of capital or destination in time to reserve for future operating profits.



Since the economic recovery has elements of weakness which suggests the persistence of
liquidity problems for enterprises, following the expiry of the moratorium described above and
to support companies that have passed the worst of the crisis, ABI and the other signatories
City of the Notice have proposed a number of "measures for revitalizing the business"
including the extension of the deadline for submission of applications for suspension of debts
to the banking system by SMEs that have not already received a similar benefit.

Again for the actions of "crisis" continued the supply of finance to small and medium-sized
enterprises, on favorable terms, aimed at supporting the investments to be made and / or
under construction that is the increase in working capital, through the provided the use of
Cassa (CDP) earned from savings accounts.
In particular it concerns the first phase of the intervention, which included the allocation at
the system level of 3 billion euro, the Bank Group's UBI claimed about 1,200 requests for
assistance, for more than 107 million euro of funding provided.

Under the Convention of February 2010 between the Italian Banking Association and the
CDP to regulate the distribution and use of the second tranche of 5 billion euro, the UBI has
signed a new financing agreement with the Fund
Deposits and loans that provide for the award of a ceiling to be used by February 28, 2011
amounted to EUR 286 million (the "second agreement").
The term of repayment of the second tranche of financing provided by the CDP
was set at a maximum of seven years, six months at a rate equal to Euribor plus a spread
differential for the duration of the loan and grace, and according to the Bank's Tier 1 Ratio
(less than 7%). For the UBI, in view of the adoption of grace and of selected Tier 1 ratio
above 7%, the spread was in January 2011 equal to 83 basis points for maturities in three
years, to 90 basis points down at 5 years and 96 basis points down at 7 years.
The action allows the network banks of the Group to provide financing to SMEs on better
terms, taking into account the lower cost of funds made by the Cassa.

52
1444 to January 2011 were approved funding for about 115 million euro, of which about 86
million already paid, and claims being assessed for an amount equal to more than 57 million
€.

ABI and Cassa signed December 17, 2010 a third agreement aims to support the recovery
process, which includes two ceiling:
     ·   the "Plafond 10 years, in addition to those at 3, 5 and 7 years, with a budget of € 1
         billion, to be allocated to support the need for long-term credit for investment by
         SMEs,
     ·   the "Plafond Stable" to finance the development of SMEs, which flows over the
         resources of the previous Plafond not fully used, which will offer all maturities (3, 5,
         7 and 10 years).

To rely on "Plafond 10 years" has been allocated to UBI 51.6 million euro, with a use-by date
set at June 30, 2011.
The "Plafond Stable" and instead use "on demand" and should be used for unsecured loans
(lasting from 13 to 120 months) and mortgage (lasting from 61 to 120 months) to assist
SMEs in respect of investments to be made or in progress and for the requirements of the
increase in working capital (100% eligible purposes of the forecast expenditure).
In view of the Tier 1 ratio of UBI, the spread reserved down at 10 years was in January 2011
equal to 106 basis points (confirmed for the other maturities, the spreads mentioned above).

Always with the aim to support SMEs in this difficult stage in the course of 2010 were
signed Memoranda of Understanding between the Bank and UBI some provincial
administrations (eg the provinces of Brescia and Bergamo) to facilitate the 'anticipation of
claims that companies have towards local authorities, avoiding financial strain on these
enterprises as a result of possible delays in payment.
These agreements provide for the granting by the member banks to advance funds on such
loans, notified after the sale thereof, with a duration of up to 17 months and spread the
content.
Given these memoranda of understanding, local companies attest to the credits as certain,
liquid and payable and shall state the time period within which you will pay on behalf of the
transferee bank certificate, as well as the method of payment.

For households, January 20, 2010, the Group signed the agreement for the suspension of
the repayment of loans in relation to families in difficulties as a result of the crisis, signed
by the ABI and thirteen consumer associations26. It is one of the initiatives of the "Family
Plan" ABI, which aims to enhance the sustainability of the market for retail loans.
The measure, unique in the European mortgage market, is a solution similar to the
'Agreement for the suspension of debts of small and medium-sized enterprises to the
banking system "described above.
During the year the moratorium led to the suspension of 1,114 loans at the level of
Group, for an outstanding debt of over € 93 million.

The Group has also signed the Framework Agreement signed in May 2009 by the ABI and
the CEI (Italian Episcopal Conference), providing the "Loan of hope" for the families who
have lost all earned income, annuities do not enjoy or other income outside of that
generated by the properties of the dwelling house or



2 In summary, the agreement provides for the suspension for at least 12 months of repayment of loans up to 150,000 € lit
6
  for the purchase, construction or renovation of the main, even with late payments of up to
  180 consecutive days, to customers:
     · with taxable income up to € 40,000 per year;
     · who have been particularly bad in 2009-2010 events (death, loss of employment, conditions of occurrence
        of long-term care, access to the layoff).

                                                                                                                           53
allowance layoff Ordinary or Extraordinary and aims to make plans for the re-employment
or start a business.
The delivery of these loans, available from September and up to 2012, has been centralized
in Banca 24-7.
As part of the 16 were granted funding for a total of 96,000 €, these numbers are content
because of the mandatory requirements imposed by the Memorandum of Understanding.
Just on the basis of this evidence the agreement was recently amended in 2011 and is
expected the project involves a larger number of families with a consequent increase in the
practice.

In the face of the continuing situation of grave hardship for families affected by the
earthquake of 2009, Abruzzo, the Group has joined the new agreement between ABI and
CDP, which integrated the one signed in 2009 by raising eligibility limits and adding new
forms of financing those already provided by the First Protocol.
In 2010, UBI Banca Private Investment bank of the Group in areas of the earthquake, has
provided 34 loans totaling approximately 1.3 million euro in total.

A confirmation of the social role of banks in the territory in cases of natural disasters, the
UBI is then intervened, through the Banco di Brescia, in support of the municipalities
affected by the flooding of the Veneto region of 31/10-02/11, joining early - for families as
well as SMEs - as provided by the Ordinance Pres Cons. Ministers No 3906 of 13.11.2010.

In the last quarter has started, finally, the operations on the Solidarity Fund for loans to
purchase their first home, initiated by the Ministry of Economy and
Finance with Law 244 of 24/12/2007. The provision of the law, had intervened to help
borrowers in trouble with the regular payment of loan installments due, allowing, among
other things:
     ·   to loan agreements for the purchase of housing units to be used as a main residence
         of the borrower, the ability for the customer, under certain circumstances to require
         the suspension of payment of installments for not more than twice for a maximum
         total not exceeding 18 months during the term of the loan;
     ·   established at the Ministry of Economy and Finance of the aforementioned
         "Solidarity Fund for loans to purchase their first home", which is activated at the
         request of the borrower who wishes to have the right to suspend, to provide for the
         payment of cost of banking procedures and any notarial fees necessary for the
         suspension of payment of mortgage payments;
     ·   that the suspension may be waived if the borrower proves to not be able to arrange
         to pay the mortgage payments and expenses for renegotiation and before it began
         enforcement proceedings for the enforcement of collateral.

The first applications for membership are arriving in recent weeks, but the results of the
initiative can be better monitored in 2011.


Covered Bond
In previous years the UBI proceeded to make further diversify its sources of institutional
funding and make several emissions
Bonds (covered bonds) Within a maximum of € 10 billion issued in July 2008 and this
program, "multioriginator", provides a scheme involving 10 banks in the Group, including
the Banco di Brescia.

The first two issues - public - were made in the second half of 2009, and during 2010 there
were made three more, one private and two public, while the more recent issues have been
placed in early 2011.
All public issues have been rated AAA / Aaa by Moody's and Fitch and - with the exception
of the fifth series - were treated by Barclays as Arranger.



54
Guarantor is a company vehicle emissions UBI Finance Ltd, which was formed at a portfolio
of residential mortgage loans sold by banks in the Group participating in the program, in
this context, the Bank - which had already made a sale of assets in December 2009 - has
made additional € 675 million (outstanding debt capital), the sale of mortgages in May 2010.

The following is a summary of the emissions of covered bonds outstanding at the date of
this report, and refer for further details on the operation and the role played by the Bank
within the Covered Bond Program, as indicated in the notes - Part E - Section 1: Credit Risk
- C. Securitisation and asset disposals.

Program covered bonds UBI Banca - Outstanding issues
                                                              Date             Date                          Coupon
N. series                 Title                             issuance          expiry         Capital         (*)

    1
 (Public)   UBI BANCA CB 3.625% due 23/09/2016             23/09/2009 23/09/2016 1.000.000.000 36.250.000
    2
 (Public)   UBI BANCA CB 4.000% due 16/12/2019             16/12/2009 16/12/2019 1.000.000.000 40.000.000
    3       UBI BANCA TV CB due 30/04/2022                 30/04/2010 30/04/2022           250.000.000      2.271.200
(Private)
    4
 (Public)   UBI BANCA CB 3.375% due 15/09/2017             15/09/2010 15/09/2017 1.000.000.000 33.750.000
    5
 (Public)   UBI BANCA CB 3.125% due 18/10/2015             18/10/2010 18/10/2015           500.000.000 15.625.000
    6
 (Public)   UBI BANCA CB 5.250% due 28/01/2021             28/01/2011 28/01/2021 1.000.000.000 52.500.000
    7
 (Public)   UBI BANCA CB 4.500% due 22/02/2016             22/02/2011 22/02/2016           750.000.000 33.750.000

(*) For the 3rd series semi-annual coupon rate is variable, the amount mentioned relates to the coupon expires in early
     May.



The evolution of the rules of prudential supervision
Measure of the Bank of Italy on prudential filters
On May 18, 2010 was enacted the provisions relating to provisions for monitoring the
prudential treatment of reserves in government bonds of countries
EU held in the portfolio "Financial assets available for sale (AFS)" in the calculation of
regulatory capital.
This legislation provides the opportunity, as an alternative approach "asymmetrical" (full
deduction of net loss from Tier 1 and partial inclusion of the net gain in Tier 2) now used, to
make use of the opportunity to completely neutralize the gains and losses recognized in the
aforementioned reserves (approach
"Symmetric").
Since the current approach, in situations of turbulence on the markets as those recorded on
government bonds, could lead to an unjustified regulatory capital volatility due to sudden
changes in the prices of securities tied to lasting changes in the creditworthiness of
broadcasters, the Group has chosen to take advantage of the "symmetrical".
This decision was applied uniformly by all components of the Banking Group, as required
by law, the prudential reporting in June 2010.

Basel 3
On 16 December 2010 the Basel Committee on Banking Supervision published the new
rules on capital and liquidity of the banks that will come into force gradually from 1
January 2013.
The new regulation aims to strengthen the quality and quantity of bank capital, limiting the
leverage of the system, mitigating

                                                                                                                    55
possible effects of pro-cyclical prudential regulations and a more careful control of liquidity
risk.
Compared to the consultative proposals issued in December 2009, a reduction in the capital
absorption in the face of deferred tax assets and shareholdings in banks and financial and
insurance companies, recognizing the contribution of assets to partially cover the risks at a
consolidated level of interest minority held in banks and other companies belonging to the
group subject to regulation equivalent to that bank.

The new rules on capital
The new rules provide for a restructuring of banks' capital in favor of ordinary shares and
retained earnings (Common Equity), the adoption of more stringent criteria for the
computation of other equity and greater international harmonization of items to be deducted
. Have also increased the requirements for particularly risky exposure (such as
securitisations and operations in derivatives).

A scheme, banks will have capital resources of not less than the following levels:
       heritage of quality primary (Common Equity): 4.5% of risk weighted assets;
       core capital (Tier 1): 6% of risk weighted assets;
       total assets (Total Capital): 8% of risk weighted assets.

The banks should provide their own capital resources in excess of the minimum quality
primary (buffer for the preservation of capital) for an amount equal to 2.5% of risk weighted
assets, if they will not incur supervisory measures (such as constraints the distribution of
profits or payment of bonuses to employees). During periods of excessive expansion of credit
disbursed a total economy, banks may be required an additional buffer up to 2.5%.

The new standards will be introduced gradually:
      ·     from 2013 the new minimum requirements relating to the Common Equity and Tier
            1 will be respectively equal to 3.5% and 4.5% of risk weighted assets and will be
            gradually increased to the levels required in the new 2015. Similarly, new deductions
            from capital will be fully implemented from 2018;
      ·     buffer for the preservation of capital will be introduced from 2016 and the transition
            to the new scheme will be completed in 2019;
      ·     the equity already issued and according to the rules in force will be fully counted
            until 2013, and thereafter the amount recognized for regulatory capital purposes will
            be reduced by 10% every year.

                              New minimum capital requirements

                                                     Common Equity
                                                                         Tier 1     Total Capital
                                                    (After deductions)

                              Minimum requirement      4.5%              6.0%             8.0%
                              Buffer conservative      2.5%
                              Total                    7.0%              8.5%             10.5%
                              Cyclical buffer        0% -2.5%


Timing Adjustment (Dates refer to 1 January)

                                                    2013         2014    2015      2016           2017     2018     2019

Common Equity minimum                               3.5%         4.0%    4.5%      4.5%           4.5%     4.5%     4.5%
Buffer conservative                                                               0.625%          1.25%   1.875%    2.5%
Common Equity + Buffer conservative minimum                                       5.125%          5.75%   6.375%    7.0%
Tier 1 minimum                                      4.5%         5.5%    6.0%      6.0%           6.0%     6.0%     6.0%
Total minimum capital ratio                         8.0%         8.0%    8.0%      8.0%           8.0%     8.0%     8.0%

Total capital ratio + Buffer conservative minimum   8.0%         8.0%    8.0%     8.625%          9.25%   9.875%   10.50%


56
The indicator of financial leverage (Leverage Ratio)
It was planned to introduce a measure of maximum leverage (Leverage Ratio) designed to
constrain the expansion of overall exposure to the availability of adequate capital base and
to avoid, in the early stages of the economic cycle, the level of debt in the budget banks.
Intermediaries must hold an amount of Tier 1 ratio is not risk-weighted assets of at least
3%.
Even this measure will be introduced gradually. In the early years the leverage ratio
represents a measure of the second pillar, any adjustments to the definition and calibration
of the instrument will be considered before its application as a rule of the first pillar in
2018. Banks should give adequate information on the measure of the market since 2015.

The standards on liquidity risk
Were introduced two quantitative rules on liquidity. The first (Liquidity Coverage Ratio)
requires banks to maintain cash resources and high quality to cope with significant stress
for a period of 30 days. The second (Net Stable Funding Ratio) aims at avoiding structural
imbalances in the composition of assets and liabilities of the budget over a period of one
year.
Like the capital measures, the entry into force of the conditions on the risk of liquidity will
be gradual: after a period of initial observation of short-term indicator will come into force in
2015, the structural in 2018.

The transposition of EU directives
By December 31, 2010 came into force the new supervisory arrangements to incorporate
some measures approved by the Community institutions during 2010 [Directive
2009/27/EC, 2009/83/CE and go to amending Directives 2009/111/EC 2006/48 and
2006/49 (cd CRD)] in order to strengthen the prudential regulation of the European Union
in some respects like the financial crisis had revealed weaknesses.
This is a first package of amendments (known as CRD II) that involves several areas in
particular:
    ·    the government and the management of liquidityWith the introduction of rules
   ·    :
   ·



   ·


                                                                                                    57
·   higher conversion and therefore more responsive to the risk that this form of support
        during the crisis has shown, however, by introducing a ban on banks to take positions
        securitisations where the originator or sponsor has not made known to maintain a
        share of risk (so-called retention);
        · With regard to remuneration policies, started a process of consultation with the
        Bank of Italy on a new single text to replace all the existing regulatory system, which
        combines the general principles regarding the remuneration policy of the whole staff,
        to be applied to all banks in a pro rata basis, with specific rules refer mainly to those
        who hold key roles within the organization.
        PattiChiari Consortium: The Commitment to Quality
        During the year work continued on implementation and management of Commitment
        to Quality and other initiatives promoted by the Consortium PattiChiari, joined all the
        network banks of the Group with the objective of contributing to the improvement of
        relationships with retail customers.
        On one side were launched operationally's Commitment to Quality not yet activated,
        according to the shared calendar in the consortium, and, on the other hand, have
        consolidated the commitments already undertaken previously. The Bank Group also
        continued financial education programs in schools, actively promoted for some
        years.In the second half of the year showed the opportunity to begin a project to
        rationalize the Commitment to Quality, is to make them clearer and better
        communicated to customers, is to realign the overall evolution of self-regulation in the
        interim and avoid unnecessary duplication. The dynamic nature of the project has
        thus led to exclude from the scope of the commitment PattiChiari originally planned to
        merge and other homogeneous areas, while maintaining the substance of all the
        contents of existing service 27.
        Thanks to the optimization process, however, consistent with the general principles
        underlying the project (simplicity, clarity, comparability and mobility of clients), banks
        will be easier to spread the knowledge of the commitments from our customers,
        enhancing the role of tools for more aware and informed choices.
        Code for the Protection of Personal Data (Legislative Decree 196 of 30 June 2003)
        In compliance with Rule 19 of the Technical Regulations, Annex B to the decree.
        196/2003, has been completed within the time limits legge28 the annual update of the
        Security Policy Document (PSD) requirements of Article. 34, paragraph 1, letter g) of
        the above decree.
        Regarding in particular the processing carried out by computer, the Bank has
        outsourced at UBI Sistemi e Servizi ScpA, this guarantees under the contract of
        service, compliance and the adoption of measures in terms of law security required
        by law.
        The social and environmental responsibility
        The Plan for Social Responsibility
        In the field of Corporate Governance, at the conclusion of a shared path, which
        involved the management, through a series of interviews, and an interdepartmental
        working group consists of the macro areas of UBI Banca, from retail banks and major
        companies
        27 At present the scope of the project is represented by eleven Commitment to
        Quality (current accounts compared against the base, the average time of closure of
        accounts, transfer of payment services, portability of data of the loan, the
        transferability of the securities portfolio , transferability of Ri.Ba., FARO - ATM
        operation services, home-banking, securities, security of payment cards, certificates
        of mutual interest and costs) and two initiatives for optional membership (the list of
        managed services to the account, for information ' access to credit for small and
        medium enterprises).
        28 Updating the DPS for the current year will be approved by the Board of Directors
        March 24, 2011.
Product, 13 and 14 December 2010 the Supervisory Board and the Management Board of UBI Bank
have approved the Code of Ethics, which is part of the Model of Organization, Management and
Control Leg. 231/2001 ". All banks and companies of the Group adopted the text approved by UBI
Banca - with any adjustments required by the specific regulatory activity in their industry and / or the
foreign country in which they are made - by a formal resolution of the respective administrative
bodies.
The document, which incorporates the Charter of Values of the Group and the reference to universal
principles of the Global Compact, sets out the ways in which UBI Bank and Group companies intend
to pursue its mission and deal with the various stakeholders mark on managerial and operational
activities respect for moral and legal obligations contained therein. In it are identified relevant
stakeholders for the Bank's activities are set out general ethical principles of reference and principles
of conduct in relations with stakeholders and are declined the implementation and monitoring of the
Code, including arrangements for ' submission of reports of suspected violations, for their treatment
and to impose any sanctions.
The Code applies in any organizational structure and geographical area of operation of UBI and is
brought to the attention of stakeholders through various channels.During 2011 will be a plan for
training and internal communication addressed to all the staff of the Group. Will soon be updated with
the enactment of the Code of Conduct for Staff, currently being drafted in accordance with the
guidelines in the current art. 8.3 - Appendix C, which form an integral part.
Environmental Responsibility
The Group, in addition to pursuing full and substantial compliance with applicable law, it is proposed to
contribute to sustainable economic development, thus giving concrete implementation to the principles
endorsed by the Global Compact.
The environmental policy adopted in December 2008, commits the Group to reduce its environmental
impact through intelligent and responsible management of both direct impacts (ie impacts generated
by the enterprise through the resource consumption, waste production and the emission of harmful
substances) and indirect impacts (ie impacts generated by the conduct adopted by third parties with
whom the Bank has established, such as customers and suppliers).
Compared to the direct impacts, the most important goal achieved in 2010 is the use of only certified
electricity from renewable sources (RECS).
With regard to indirect impacts, the Group has been active in commercial time by offering financing
"green", or lines of credit aimed at making investments for energy saving and diversification of energy
sources, with particular reference to production of energy from renewable or low environmental
impact.
Principal risks and uncertainties faced by the Bank
Risks
The Bank attaches primary importance to measure, manage and control risks, such activities are
necessary to ensure sustainable value creation over time and strengthen its reputation on the
markets.
In compliance with the applicable provisions of the prudential supervision of banks (Bank of Italy
Circular 263/2006), the Bank has set up a process to determine the appropriate capital resources - in
terms of current and prospective - to face all risksmaterial which is or could be exposed (ICAAP -
Internal Capital Adequacy Assessment Process). In this perspective is provided on a consistent,
accurate identification of risks to be evaluated.
The task of risk identification is carried out continuously. It is aimed at verifying the relevance of the
risks already assessed and pick up the signals of the occurrence of any other categories. The
identification provides a precise conceptual definition of risk to which the Bank is exposed, the
analysis of the factors that contribute to
assessment
generate, and the description of their mode of manifestation. This activity was conducted
through a centralized analytical process, complemented by a self-assessment conducted in
relation to all entities of the Bank. Once you have completed the task of identifying the
relevant risks, the ICAAP process involves assessing the risks identified and the
determination of the total capital suitable to face them (capital adequacy), and in optical
current and prospective. For a better assessment of exposure to risk mitigation and control
systems and adequacy of capital, it also makes use of specific stress tests (by which we
assess the impacts on a single risk) and global (via which will assess the impacts of all risks
together). The Bank has adopted a system of governance and risk management covering the
areas of organization, regulations and methodology to ensure consistency of operations to
their risk tolerance. Consider the mission and operations, as well as the market
environment in which it operates, the risks have been identified for evaluation in the ICAAP,
categorized Pillar and Pillar, as indicated in the reference standard. The risks of Pillar -
already has a presence from the regulatory requirement required by the Supervisory Board -
                            credit risk (including counterparty risk), risk of incurring losses

financial risks: the risk of changes in the market value of securities held or due to
unexpected chan
Operational risk: the risk of incurring losses resulting from inadequate or failed internal
processes, people and systems internal or external events; fall into this category losses
arising from fraud, human error, business disruption, unavailability of systems, breaches of
contract, natural disasters, including the risk is legal. In addition to the risks of Pillar, we
                                                                                      s defined in
measurable and for which consolidated quantitative methodologies have been identified that
lead to the determination of internal capital or for which can be usefully defined thresholds
or quantitative limits, which allow, together with qualitative measures, the definition of a

most appropriate policies, control measures, mitigation or mitigation approaches since there
is no consolidated for the estimation of internal capital gains for the purposes of the
allocation process. The risks of second pillar under analysis are: Risk measurement: ·
concentration risk: risk arising from exposures in the banking counterparties, or groups of
counterparties in the same industry or engaged in the same activities or belong to the same
geographic area and the risk of concentration can be divided into subtypes single name
concentration risk and sector concentration risk; · risk of interest rate: current or
prospective risk of a change in net interest income and economic value of companies as a
result of unexpected changes in the rates' interest that affect the banking book;
    ·   : data set, linked to volatility in volumes due to competitive pressures and market
        conditions;
    ·   participatory risk: risk of loss arising from the investment portfolio;
    ·   property risk: risk of changes in value of assets.

The risks measurable are conventionally includes those risks for which there is at
consolidated approaches for estimating the internal capital can be defined operational limits
of a quantitative nature, also shared in the literature relevant to their measurement,
monitoring and mitigation.
These risks are:
    ·   Liquidity risk: risk of failure to fulfill its payment commitments that may be caused
        by inability to raise funds or find them at higher costs than market (Funding liquidity
        risk) or the presence of limits on realization of the activities (Market liquidity risk)
        incurring a capital loss;
    ·   structural liquidity risk: risk resulting from an inappropriate balance Maturities of
        assets and liabilities.

Risks can not be measured:
    · risk resulting from securitizations: risk that the economic substance of the
         securitization is not fully reflected in pricing decisions and risk management;
    ·    compliance risk: risk of incurring legal or administrative significant financial loss or
         reputational damage as a result of violations of mandatory rules (of law or
         regulations) or self (statutes, codes of conduct, Codes of Conduct);
    ·    reputational risk: risk of loss resulting from a negative perception image of the bank
         by customers, counterparties, shareholders of the bank, investors, regulators or
         other stakeholder;
    ·    residual risk: risk of incurring losses resulting from unforeseen ineffectiveness of
         accepted techniques for mitigating the credit risk used by the company
         (Eg mortgage);
    ·    strategic risk: current or prospective risk of a decline in profits or capital arising
         from changes in the business environment, inadequate implementation of decisions,
         lack of responsiveness to changes in the competitive environment.

Credit risk is the risk most important characteristic of the Bank on a historical basis it
absorbs about 90% of regulatory capital at risk.
The past year was characterized by a substantial weakness in the economic recovery
following the sharp downturn that characterized the 2008 and 2009. As we've seen timid
signs of recovery, the persistence of the difficulties is the production system in general and
the related consumption crisis continued to adversely affect the ability of businesses and
individuals to meet their commitments, while maintaining high credit risk and -
consequently - the credit flows and abnormal accruals.
It is believed that the 2011 will only see a slow recovery of the determinants of the riskiness
of the financial system and in particular activity levels on the edge of business and
household income.

With regard to the risk of structural liquidity, the relationship between funding sources and
those of use may highlight tensions arising from the fact that, on the one hand, the volume
of use will be difficult to compress, while the other, the need to replace the securities
maturity and the progressive impoverishment of families make the feeble market
borrowings. Moreover, the Bank, in front of the schedule of its bonds, has developed a
structured plan of new issues at the moment is fully respected.

With regard to liquidity risk, the issues of confidence in the institutional and interbank
markets, especially due to concerns on the solvency of some Member

                                                                                                    61
rulers, against a backdrop of a slowdown in the traditional funding, due to reduced
household disposable income. The effect of country risk significantly penalizes Italian banks
in funding markets wholesale intermediaries than other European countries.

The risks other than those mentioned above, the marginal significance within the Bank is
not expected to have to undergo significant changes during the year.

The detailed information on the objectives and policies on financial risk management and
the Bank's exposure to price risk, credit risk, liquidity risk and the risk of cash flow -
provided by ' art. 2428 Civil Code
- Is shown in Part E of the Notes to which it refers.


Uncertainties
The uncertainty is defined as a possible event where the potential impact, due to a of the risk
categories identified above, is not determinable at the time, and then quantified.

For the Bank looming scenario of moderate recovery in volumes, margins of content, with a
credit risk still high. The economic recovery, which also has started, which vary between
countries presents trends: strong in emerging economies slow in the advanced economies.
There are still other potential vulnerabilities: the rapid growth of debt in some countries of
the euro could lead to doubts about the sustainability of public finances, the markets are
still highly volatile and could rise to tensions for the refinancing of a large amount of bank
debt in competition with sovereign states and businesses.

The uncertainties identified impacts might occur, mainly due to credit risk, interest rate and
liquidity risk.

In particular, the main uncertainties identified for the financial year 2011 related to:
     ·   evolution of the macroeconomic framework. The statistics released since the beginning
         of 2011 have confirmed the continuation of the phase of global growth, thus
         assuming a strengthening recovery in the current year. It is not, however, exclude the
         possibility of temporary moderation in the pace of expansion.
         In particular, a positive contribution to the evolution of the macroeconomic situation
         should continue to come from emerging countries - which have been the driver for all
         of 2010 - despite the tight monetary policy decided by several central banks,
         including those of India and China, in order to counter inflationary pressures.
         In this international context, in 2010 the Italian GDP has been a breakthrough in real
         terms by 1 .3%, led by the rise in exports in considerable measure, although the
         channel's contribution to net foreign imports have registered a slight contraction. It is
         also noted that an important contribution to the expansion of the economy was
         provided by domestic demand excluding inventories. Favourable indications also
         came on the industrial front, where there was an average annual output of 5.3% and
         13.9% of manufacturing orders.
         Regarding the profile of inflation in recent months, especially in the euro area, the
         dynamics of consumer prices was affected by the sharp increase in the prices of raw
         materials, particularly with regard to oil in the light of the strengthening of economic
         and global geopolitical instability in North Africa and the Middle East. The evolution
         of commodities is also reflected in "upstream" showing pressure on producer prices.
         Anyway, on to Italy, in 2010 inflation rose 1 .9% powered to a greater extent than
         from the goods and services.
     ·   financial markets and the curve of interest rates. During the 2010 continued the
         process of exit strategy maneuvers by expansionary monetary policy implemented by
         the ECB to tackle the crisis in the credit market

62
        that had characterized previous years. In this regard, stresses that the main
        refinancing auctions in the longer term (6 and 12 months) have not been renovated,
        but replaced by a process equal to or less than 3 months. The past year has seen an
        increase in tensions linked to the sovereign countries of the so-called
        "Peripheral" for the euro area (with particular reference to Greece, Spain, Portugal
        and Ireland).
        At the end of 2010 there was a moderate increase in interbank rates that have
        followed the normalization process dictated by the gradual removal of special
        measures implemented by the European Central Bank during the last recession,
        while swap rates showed a marked contraction.
        Finally, on the bond portfolios of properties, the risk remains of a large volatility in
        returns and consequently in prices, resulting from uncertainties related to the
        solvency of some sovereign debt, and the process of normalization of monetary
        policy.

        In the context outlined, is part of the periodic review of the recoverability of goodwill
        that depends on parameters and information significantly influenced by the
        macroeconomic framework and related to the difficult situation of financial markets
        and - consequently - subject to rapid change.
    ·   changes in regulatory environment. The regulatory environment is subject to various
        dynamics of change following the enactment of various legislative measures both at
        Community and national level, with the regulatory provisions for implementation, in
        the provision of banking services (eg. in terms of payment or credit services to
        consumers ) and the related authorities cited (eg. in terms of form of contracts,
        interest or other remuneration for banking services), such a scenario, which
        introduced moments of discontinuity, may have a direct effect on the profiles of
        banks' profitability, requiring a special effort is interpretive implementation.

                                                   ***

The risks and uncertainties described above were the subject of an evaluation process also
aims to highlight the impact of parameter variations and market conditions on business
performance. The Bank is in fact equipped with instruments to measure potential impacts
of risks and uncertainties about its operations (particularly through sensitivity analysis and
stress tests), which allow, in time and continuity, adapting their strategies - in terms of
distribution model, organizational and management / rationalization of costs - compared to
the changes of context. The risks and uncertainties are also subject to continuous scrutiny
by the regulatory body of policy adopted by the Group Risk: the policy is updated in relation
to changes of strategy, context and expectations of the market. The monitoring periods of
the same aims at the verification of their implementation and their adequacy. The analysis
carried out indicate that the Bank is able to cope with the risks and uncertainties to which
it is exposed, thus confirming the conditions of its continuity.




                                                                                                    63
Significant events after the balance sheet
It refers to that given in Accounting Policies - Section 3 - Events after the balance sheet
date.



Business Outlook
Macroeconomic data regarding the trend in early 2011 and the succession of catastrophic
events of the war in Japan and North African countries are painting a less than reassuring
path just a few months ago, with a stop in the pace of recovery and prolonged the period of
turmoil.
In this scenario of overall weakness, in which the modest domestic growth will be confirmed
for this year, some areas will continue to maintain the uncertain prospects for expansion,
while others will march at a fast pace, reflecting the greater degree of openness on 'of their
production abroad.

In this situation, monetary policies, unlike the tax, should remain more expansive, less than
a rapid restart of the process of inflation, but not determined by the overheating of the
economy, but rather by tensions in commodity markets. The exit strategy should now be
sent back in time and supports extraordinary re-elected, the expectations on future
monetary interest rates should remain depressed, with rates in the medium and long-term
contained in the historical comparison, although a slight upward tendency.

With regard to the banking system, short-term developments described foreshadow a 2011
characterized by low profitability - with very narrow margins, supply costs of borrowing
increasing, moderation in the pace of increase in lending and funding - and a more
expansionary effect on the suffering bank determined by the economic cycle at different
speeds.

In this context, the strategies that will direct the management policies of the Banco di
Brescia in 2011 will aim to develop business based on long-term relationships with
customers, even through the intervention of the New Model Retail aimed at strengthening
the territorial presence and improving the efficiency of trade. The rise of the masses, the
careful control of costs, calibration costs / investments, the strong presence of credit
quality, would then lead to an improvement in profitability of ordinary Bank.




64
Proposals to

Dear Shareholders,
We submit for your approval the budget for 2010 in all its components.



Also submit for your approval, the allocation of net income of € 71,978,717 as follows:



           PLAN OF ALLOCATION OF PROFITS


       Net income for 2010                                                                71.978.717
       Profit to be distributed:

       - 5% to legal reserves                                                              3.598.936

       - The Fund for the purposes of Article. 23 of the Statute                           1.367.596
       - Dividend to shareholders                                                         18.106.830

       - Extraordinary reserve                                                            48.905.355

                                                                                                       -

       0                                                                                               -

       0                                                                                               -

       0                                                                                               -




If the present proposals are approved by you, will be paid a dividend of € 0.020 for each n.
905,341,516 shares entitled to dividend for the year 2010.




Brescia, March 24, 2011




                                                                    The Board of Directors




                                                                                                           65
     Financial
     Statements




66
Balance Sheet
(In euro)


                                                                                             Change            % Change
 ASSETS                                                31/12/2010       31/12/2009
                                                                                             Annual             Annual
10. Cash and cash equivalents                             73.922.079       92.583.622       (18.661.543)            (20,16)
20. Financial assets held for trading                   100.954.078       114.258.929       (13.304.851)            (11,64)
40. Financial assets available for sale                   20.913.234       26.338.852        (5.425.618)            (20,60)
60. Loans to banks                                       851.390.951 7.442.071.797        (6.590.680.846)           (88,56)
70. Loans to customers                                15.078.204.303 14.178.740.507         899.463.796                   6,34
80. Hedging derivatives                                   45.470.820       75.128.363       (29.657.544)            (39,48)
90. Fair value of financial assets in hedged assets       40.200.418       21.556.251        18.644.167              86,49
100. Investments                                          19.022.272       16.122.340         2.899.932              17,99
110. Tangible assets                                     293.835.505      297.386.463        (3.550.958)              (1,19)
120. Intangible assets                                    19.705.120       19.739.210           (34.090)              (0,17)
       Of which:
             goodwill                                     19.705.120       19.705.120 -                                      -
130. Tax assets:                                          65.836.998       76.127.309       (10.290.311)            (13,52)
       a) current                                         32.240.476       50.288.791       (18.048.315)            (35,89)
       b) deferred                                        33.596.522       25.838.518         7.758.004               30,02
150. Other assets                                      1.012.349.153      320.366.690       691.982.463             216,00
Total assets                                          17.621.804.932 22.680.420.333     (5.058.615.401)             (22,30)




                                                                                             Change            % Change
 LIABILITIES AND SHAREHOLDERS’ EQUITY                  31/12/2010       31/12/2009
                                                                                             Annual             Annual
10.   Due to banks                                     3.341.563.843    1.370.704.813 1.970.859.030                 143,78
20.   Due to customers                                 8.885.717.640    8.870.849.483        14.868.157                   0,17
30.   Securities in circulation                        3.233.255.630   10.300.310.442 (7.067.054.812)               (68,61)
40.   Trading financial liabilities                       76.037.013       81.138.029        (5.101.016)              (6,29)
60.   Hedging derivatives                                 64.840.050       51.428.646        13.411.404              26,08
80.   Tax liabilities:                                    39.737.294       59.174.103       (19.436.809)            (32,85)
         a) current                                       22.725.811       32.199.614        (9.473.803)            (29,42)
         b) Deferred                                      17.011.483       26.974.489        (9.963.006)            (36,93)
100. Other liabilities                                   432.261.984      573.302.445     (141.040.461)             (24,60)
110. Provision for employee severance                     61.986.645       63.808.427        (1.821.782)              (2,86)
120. Provisions for risks and charges:                    26.300.925       22.998.809         3.302.116              14,36
        b) other funds                                    26.300.925       22.998.809         3.302.116              14,36
130. Revaluation reserves                                 14.181.932       21.205.857        (7.023.925)            (33,12)
160. Reserves                                            638.311.027      423.226.411       215.084.616              50,82
170. Share premium                                       120.000.000      120.000.000                      -                 -
180. Capital                                             615.632.231      593.300.000        22.332.231                   3,76
200. Operating profit                                     71.978.717      128.972.868       (56.994.151)            (44,19)
Total liabilities and equity                          17.621.804.932   22.680.420.333 (5.058.615.401)               (22,30)




The data for comparative periods are not homogeneous as a result of the optimization
Territorial.




                                                                                                                            67
Income Statement
(In euro)


                                                                                                       Change        % Change
                                                                31/12/2010          31/12/2009
                                                                                                      Annual         Annual

10. Interest receivable and similar income                       508.435.640         668.984.370     (160.548.730)       (24,00)
20. Interest payable and similar charges                        (181.830.662)       (300.211.146)     118.380.484        (39,43)
30. Net interest income                                         326.604.978         368.773.224      (42.168.246)       (11,43)
40. Commissions earned                                           210.212.875         200.943.307        9.269.568          4,61
50. Fees and commission expenses                                 (14.952.686)        (16.198.225)       1.245.539         (7,69)
60. Net commission income                                       195.260.189         184.745.082       10.515.107           5,69
70. Dividends and similar income                                   1.249.315            1.698.742        (449.427)       (26,46)
80. Net income from operations                                    (9.329.805)           5.513.744     (14.843.549)          n.s.
90. Net income from hedging                                        7.908.538            4.338.185       3.570.353         82,30
100. Net income (loss) on disposal of:                               (56.333)             351.885        (408.218)          n.s.
      a) loans                                                             19                   13              6         44,15
      b) financial assets available for sale                                    -         490.936        (490.936)              -
      d) financial liabilities                                       (56.352)           (139.064)          82.712        (59,48)
120. Operating income                                           521.636.882         565.420.862      (43.783.980)        (7,74)
130. Losses / recoveries on impairment of:                       (98.708.074)        (70.568.255)     (28.139.819)        39,88
      a) loans                                                   (97.858.978)        (69.219.974)     (28.639.004)        41,37
      b) financial assets available for sale                                    -         (93.873)         93.873               -
      d) other financial                                            (849.095)         (1.254.408)         405.313        (32,31)
140. Net income from financials                                 422.928.808         494.852.607      (71.923.799)       (14,53)
150. Administrative costs                                       (330.267.253)       (323.122.506)      (7.144.747)         2,21
      a) staff costs                                            (172.842.859)       (165.124.307)      (7.718.552)         4,67
      b) Other administrative expenses                          (157.424.394)       (157.998.199)         573.805         (0,36)
160. Net provisions for risks and charges                         (2.874.862)         (3.257.733)         382.871        (11,75)
170. Impairment / write-backs on property and equipment          (10.105.832)        (11.096.152)         990.320         (8,92)
180. Impairment / write-backs on intangible assets                   (34.090)              (9.036)        (25.054)          n.s.
190. Other net operating income                                   37.986.132          43.268.678       (5.282.546)       (12,21)
200. Operating expenses                                         (305.295.905) (294.216.749)          (11.079.156)          3,77
240. Gains (losses) on disposal of investments                     1.296.499              (76.193)      1.372.692           n.s.
250. Net income (loss) from continuing operationsbefore taxes   118.929.403         200.559.665      (81.630.262)       (40,70)
260. Taxes on income from continuing operations                  (46.950.686)        (71.586.797)      24.636.111        (34,41)
270. Net income (loss) from continuing operationsafter taxes      71.978.717        128.972.868      (56.994.151)       (44,19)
290. Operating profit                                             71.978.717        128.972.868      (56.994.151)       (44,19)




The data for comparative periods are not homogeneous as a result of the optimization Place.




68
Statement of Comprehensive Income
(In euro)



                                                      Items             31/12/2010       31/12/2009


10. Net profit (loss)                                                     71.978.717       128.972.868

      Other income, net of tax

20.   Financial assets available for sale                                  (5.191.947)        2.825.633

30.   Tangible assets

40.   Intangible assets

50.   Hedging of foreign investment

60.   Cash flow hedges                                                           (370)

70.   Exchange rate differences

80.   Non-current assets held for sale

90.   Profit (losses) on defined benefit plans                             (1.831.608)         445.005

100. Quote of the valuation reserves for investments valued at equity

110. Total other comprehensive income after tax                           (7.023.925)        3.270.638

120 Comprehensive income (Item 10 +110)                                   64.954.791       132.243.506




                                                                                                      69
Statement of changes in equity
To December 31, 2010
(In euro)


                                                                                         Allocation of                                                           Changes during the year
                                                                                          Previous profit                                                          Equity transactions
                                               Changes to                                                                                                                                                                                    Shareholders'
                            Balance at                       Balance at                                                                                                                                                    Profitability           equity
                                               opening
                           31/12/2009                       01/01/2010                                            Variations                                                                                                               to 31/12/2010
                                             balance                                                                                             Purchase       Distribution        Change     Derivatives                      Overall
                                                                                                dividends and
                                                                                                         other   reserves       Issuance                                            Capital                   Stock
                                                                              reserves                                                           treasury       extraordinary       insatrumen    treasury                    year 2010
                                                                                                destinations                    new shares                                                                   options
                                                                                                                                                                 Dividends          ts          shares
                                                                                                                                                 shares


Capital:                      593.300.000                    593.300.000                   -                                    22.332.231                  -                                                                                615.632.231

     a) Ordinary shares       593.300.000                     593.300.000                                                       22.332.231                                                                                                    615.632.231

     b) other shares                     -                                -                                                                                                                                                                              -

Share premium                 120.000.000                    120.000.000                                                                                                                                                                     120.000.000

Reserves:                     423.226.411             -      423.226.411       94.239.884                        120.844.731                 -              -                   -                        -             -                     638.311.027

     a) profit                423.226.411             -       423.226.411       94.239.884                           (97.166)                                                   -                                                             517.369.129

     b) other                            -            -                   -                -                     120.941.897                                                    -                                                             120.941.897

Revaluation reserves           21.205.857                      21.205.857                                                                                                                                                    (7.023.925)       14.181.932

Equity instruments                       -                                -                                                                                                                                                                              -

Treasury shares                          -                                -                                                                                                                                                                              -

Net income (loss)             128.972.868             -      128.972.868      (94.239.884)        (34.732.984)                                                                                                               71.978.717        71.978.717

Net Assets                  1.286.705.136                   1.286.705.136                  -      (34.732.984)   120.844.731    22.332.231                  -                   -            -           -             -     64.954.791     1.460.103.906




In adherence to the guidelines Assirevi (cd OPI), was set a positive reserve equal to € 120,941,897, as follows:
   in relation toll'operazione Spatial Optimization(€ 119,019,389)
       (€ 22,332,231) in exchange of a capital increase to service the acquired branches;
       € 32,731,947 in return for investments recorded in front of the branches assigned;
       € 108,659,841 net gain in return for the sale of shares;
       € (40,168) in return for the company's various expenses incurred.
 in relation to the conferral of a branch of UBI International SA Luxembourg, € 1,922,508 in return for participation register ed against the
   given branch.




70
Statement of changes in equity
Handling the December 31, 2009
(In euro)


                                                                                               Allocation of                                                                Changes during the year
                                                                                                Previous profit                                                                Equity transactions
                                              Changes to
                           Balance at                           Balance at                                                                                                                                                                  Profitability         Equity at
                                              opening
                          31/12/2008                           01/01/2009                                                Variations                                                                                                                          31/12/2009
                                              balance                                                                                     Issuance       Purchase         Distribution         Change      Derivatives                        Overall
                                                                                                       dividends and
                                                                                                                 other   reserves                                                              Capital                         Stock
                                                                                    reserves                                                 new                          extraordinary                        treasury                      year 2009
                                                                                                       destinations                                                                            instruments                    options
                                                                                                                                          shares           treasury         Dividends                        shares
                                                                                                                                                           shares


Capital:                   593.300.000           X              593.300.000                        -                                                 -                -                                                                                       593.300.000

     a) Ordinary shares     593.300.000                          593.300.000                                                                                                                                                                                   593.300.000

     b) other shares                      -                                    -                                                                                                                                                                                              -

Share premium              120.000.000                          120.000.000                                                                                                                                                                                    120.000.000

Reserves:                  264.784.506                     -    264.784.506         158.441.905                                       -              -                -                   -                               -             -                      423.226.411

     a) profit              264.784.506                -         264.784.506        158.441.905                                                                                           -                                                                    423.226.411

     b) other                                          -                       -                   -                                                                                      -                                                                                   -

Revaluation reserves        17.935.219                           17.935.219                                                                                                                                                                      3.270.638      21.205.857

Equity instruments                        -                                    -                                                                                                                                                                                              -

Treasury shares                           -                                    -                                                                                                                                                                                              -

Net income (loss)          216.653.318                     -    216.653.318        (158.441.905)        (58.211.413)                                                                                                                          128.972.868      128.972.868

Net Assets                1.212.673.043                        1.212.673.043                       -    (58.211.413)                  -              -                -                   -              -                -             -     132.243.506    1.286.705.136




                                                                                                                                                                                                                                                                    71
Cash Flow
(In euro)




                                    INDIRECT METHOD                                                31/12/2010            31/12/2009

A. ACTIVITY 'OPERATIVE
1. Management                                                                                         228.817.468          284.871.388
- Net income for the year (+/-)                                                                         71.978.717          128.972.868
- Gains / losses on investments held for trading and
financial assets / liabilities at fair value (-/+)                                                          192.772            1.888.293
- Gains / losses on hedging (-/+)                                                                       (7.908.538)         (14.327.667)
- Adjustments to / recoveries on impairment (+/-)                                                      108.410.384           81.407.811
- Adjustments / write-backs on tangible and intangible assets (+/-)                                     10.139.922           11.105.188
- Net provisions for risks and charges and other costs / revenues (+/-)                                   (946.475)           4.238.098
- Taxes not paid (+)                                                                                    46.950.686           71.586.797
- Adjustments / write-backs from discontinued discontinued operations, net
of tax (+/-)                                                                                                        -                    -
- Other adjustments (+/-)                                                                                                                -
2. Cash generated from / used in financing activities                                               4.673.871.022       (1.797.408.201)
- Financial assets held for trading                                                                        7.699.896           26.846.732
- Financial assets at fair value                                                                                    -                    -
 - Financial assets available for sale                                                                      (104.355)          (3.096.131)
- Due from banks:                                                                                    6.417.153.906       (2.173.321.035)
- Due from banks: other loans                                                                                       -                    -
- Loans to customers                                                                                (1.070.850.158)         200.667.387
- Other activities'                                                                                   (680.028.267)         151.494.846
3. Cash generated / absorbed by financial liabilities                                              (4.886.723.167)       1.571.962.732
- Due to banks having                                                                                2.127.353.696         (176.226.890)
- Due to banks other payables                                                                                       -                    -
- Due to customers                                                                                      235.981.668      (1.157.774.225)
- Securities issued                                                                                 (7.052.824.581)       3.027.587.772
- Pass.finanz.di trading                                                                                  (5.009.127)        (25.441.168)
- Pass.finanz.valutate at FV                                                                                        -                    -
- Other liabilities                                                                                   (192.224.822)          (96.182.757)
                                                    Net cash used in operating activities (+/-)          15.965.324           59.425.919
B. ACTIVITY 'INVESTMENT                                                                                             -
1. Cash generated from                                                                                     3.831.787          2.333.385
- Sales of investments                                                                                              -
- Dividends received from investments                                                                      1.249.315           1.698.742
- Sales of the expiry att.finanz.det.sino                                                                           -                  -
- Sales of att.materiali                                                                                   2.582.472             634.643
- Sales of intangibles                                                                                              -
- Sales of businesses                                                                                               -
2. Cash absorbed by:                                                                                     (3.725.670)         (6.511.994)
- Purchases of investments                                                                                          -                   -
- Purchases of att.finanz.detenute to maturity                                                                      -                   -
- Purchases of att.materiali                                                                              (3.725.670)         (6.496.900)
- Purchase of intangibles                                                                                           -            (15.094)
- Purchase of businesses                                                                                            -
                                                     Net cash used in investing activities (+/-)             106.117         (4.178.609)
C. ACTIVITY 'OF FUNDING                                                                                             -                  -
- Emisssioni / purchase of treasury shares                                                                          -                  -
- Issue / purchase of equity                                                                                        -                  -
- Distribution of dividends and other                                                                   (34.732.984)        (58.211.413)
                                                    Net cash used in financing activities (+/-)        (34.732.984)        (58.211.413)
LIQUIDITY 'Net cash ABSORBED IN                                                                        (18.661.543)          (2.964.103)

Legend: (+) generated (-) absorbed




Reconciliation of financial statements

                                    BALANCE SHEET ITEMS                                            31/12/2010            31/12/2009

Cash and cash equivalents at beginning of year                                                          92.583.622          95.547.725
Net liquidity generated / absorbed during the                                                          (18.661.543)          (2.964.103)
Cash and cash equivalents: effect of exchange rate variations                                                     -                    -
Cash and cash equivalents at the end of the year                                                        73.922.079          92.583.622




72
The Notes




            73
The notes
The notes are divided into the following parts:

       1) Part    A - Accounting Policies
       2) Part    B - Balance Sheet
       3) Part    C - Income Statement
       4) Part    D - Comprehensive income
       5) Part    E - Information on risks and hedging policies
       6) Part    F - Information on capital
       7) Part    G - Business Combinations or business enterprise
       8) Part    H - Transactions with related parties
       9) Part    I - Share-based payments Equity-
       10) Part   L - Segment




Part A - Accounting Policies
A.1 - General Part

Section 1 Statement of compliance with accounting standards
international

Premise
These financial statements have been prepared in accordance with auditing standards
issued by the International Accounting Standards Board (IASB) and endorsed the date of
preparation thereof and the related interpretations of International Financial Reporting
Interpretations Committee (IFRIC)29.

The budget shall consist of a balance sheet, income statement, statement of comprehensive
income, statement of changes in equity, cash flow, the Notes and accompanied by the
Report on Operations.

The financial statements are audited by independent auditors Ernst & Young SpA, pursuant
to art. 155, D. Decree of 24 February 1998 58 and in execution of the resolution of 11 April
2007 which assigned the task to prepare the financial statements for the year 2012.

The balance sheet at 31 December 2010 was drawn up clearly and give a true and fair view
of the financial position, financial condition, results of operations of the period, the change
in shareholders' equity and cash flows.



Section 2 Basis of preparation
These financial statements are prepared in accordance with the general principles of IAS 1
"Presentation of Financial Statements"And therefore gives all the information perspective of
business continuity and to impute costs and revenues under the accrual thereof, without
offsetting assets and liabilities, income and expenses.
The information in this annual report, unless otherwise specified, are expressed in euro as
their currency and financial situations, equity, economic, notes / remarks and explanatory
tables are in thousands of euro. Its rounds were carried out taking into account the
provisions

29
     See in this regard, the 'List of IAS / IFRS endorsed by the European Commission"Published in Part
     A.1 of the Notes to the financial statements. The principles listed therein, and related interpretations are applied
     depending on the occurrence of the events covered by them and by the year they become applicable.

74
indicated by the Bank of Italy. Entries that do not report values for the current period and
previous year are omitted.
The financial statements used in this budget are consistent with those defined by
Bank of Italy Circular No 262/2005 as amended by the First Update of November 18,
200930; They provide, as well as the amount at 31 December 2010, a similar comparative
information at 31 December 2009.

On February 16, 2011 the Bank of Italy issued the letter "roneata" No 0142023/11 with the
subject "Budget and supervisory"With which he made notes to banks and financial
intermediaries, responses to requests for clarification received Supervisory Authority, in
order to correct methods of detection of certain transactions.
A first review of that document that the information in it are substantially in line with the
practices followed by UBI.
Please note that for some types of costs are being more specific insights with the Office of
Compliance through ABI and therefore in the budget this year were not made changes to the
accounting classification already in use.


GAAP
The accounting policies set out in Part A.2, with regard to the classification, evaluation and
deletion, are the same used for the preparation of financial statements for 2009.

The accounting policies used are basically the application of the direct cost except for the
following financial assets and liabilities whose value was determined by applying the fair
value: Financial instruments held for trading (including derivatives) and financial
instruments available for sale.

For completeness we note that non-current assets held for sale (and liabilities associated
with them) are stated at the lower of carrying amount and fair value (net of selling costs).



Section 3 Events after the balance sheet date

There were no major events after the balance sheet date.



Section 4 Other aspects
Territorial Operation Optimization
The process of optimization has led to land in January, the assignment of n. 14 lines of
business - mainly consisting of branches - and the subsequent reorganization of the
structures of participation that took place the following month of July so the accounting of
the entire operation have been detected in these financial statements.

In more detail, please note that the operation in question, made between entities subject to
common control, has been accounted for under the "Guidelines concerning Assirevi
preliminary IFRS" (so-called IPO), falling outside the operations of the species within the
scope IFRS 3 "Business Combinations".
In accordance with the provisions of the OPI, the operation having a main focus
reorganization, the same was then accounted for in the continuity of values that is without
accounting recognition of economic effects.
The sale of shares took place at fair value and any gains on disposals were recorded in a
special reserve in equity.


30   As well as subsequent communication of the supervisor.
                                                                                                 75
Foreign branch
Under the plan of reorganization and strengthening of the international structure of
UBI, with effective date December 10, 2010, the foreign branch of Luxembourg has been
given in UBI Banca International SA in the "Other Information".

Hedge Accounting
It should be noted that until 31 December 2009 the Group used a strategy of hedging
interest rate for the activities of long-term fixed rate denominated in line with the
requirements of IAS 39 in the version approved by the European Community
(So-called "carve out"), which allows coverage of a predetermined amount of loans (amount
of money, logic declined with "thick"), for which we plan to put in place hedging interest
rate.

With effect from 1 January 2010 was re-covered the amount of money in accounting that
had been reduced as a result of lapses, and renegotiations default. From the operational
activities at a fixed rate not previously covered were traced to portfolios hedged amount.

Here, also facing the need to achieve complete alignment between the logic of management
and accounting, was given over to a refinement of the methodology used, while not changing
its hedging strategy, always geared to cover interest rate risk through the 'use of hedging
instruments themselves, through the logic of coverage percentage.

This percentage is in fact the expected cash flows as it is established on the basis of the
estimated lapses that occur in the future and can be revised up to a maximum of 100% of
the residual portfolio, depending on the change in the estimates Early Termination.

The best description of this methodology made it possible to neutralize the effects during the
financial year 2010 amounting to € 11.8 million in gross of the related tax effect related to
lapses, and renegotiations default.


Collective impairment losses on performing loans
In the year under review was concluded the process of adapting the management and credit
monitoring, with particular reference to the assessment of collective impairment losses on
performing loans.
This process consisted essentially in the planned adaptation of the algorithm for calculating
collective impairment in order to take on individual entities, the data arising from Basel 2
model.

The balance sheet at 31 December 2010 are therefore the first in which the fund of
collective impairment of the bank was determined by a simple multiplication of the carrying
amount, management of LGD (estimated by the model) and PD (resulting from the models
rating), consistent with the decision of Parent in respect of impairment on performing loans,
which set the elimination of logic to scale introduced in late 2008, having concluded the
process for dealing with the gradual elimination of the allocation mechanism fund.

Simultaneously, we proceeded to the periodic review of estimates of risk through the
updating of risk parameters. This activity has resulted in an increase in collective
impairment losses amounting to € 6.7 million, due to the inclusion of historical data
covering more recent periods the most critical in terms of risk.

During the year 2011, but scheduled to start production of the new generation of rating
models and LGD in the validation plan on the Basel 2 regulatory Enterprise segment.


76
Accounting for "criminal trespassing '
As mentioned in the information periodically to the September 30, 2010, last August, the
bank has implemented, in the course of a larger intervention on the conditions applied to
customers, the review of the structure and rules for "criminal trespassing '. This penalty is
applied in the case of crossings due to accounts not assigned or trespassing on the
accounts entrusted with respect to credit granted and the continued situation of the
overdraft facility and is essentially determined in a fixed amount upon the occurrence of an
overrun of more than a certain amount and in the presence of the balance outstanding for
several consecutive days,

The new condition is justified by the increased credit risk of overrunning situations for
which the bank is required to obtain adequate remuneration for the uses above the line of
credit granted and overdrafts on accounts not assigned. It is in fact situations that involve
greater credit risk and said the bank require an extraordinary cost for the fast preliminary
investigations, management and monitoring in order to garrison that risk.

Having said this shows how the proceeds relating to criminal overdraft fee structure in the
new regime is found recognition in the financial statements required under the Bank of Italy
Circular 262/05 and reclassified in the "Interest receivable and similar income". the
fundamental assumption that this rate
is undoubtedly related to the effective use of cash over time and therefore does not
constitute payment for a service. This approach is conform to the orientation of the field
emerged in the broader debate on the nature of
"Commission made funds".


Use of estimates and assumptions in preparing financial statements
The balance-sheet aggregates are evaluated according to the principles in Part A.2 declined
"The Main balance sheet items" of accounting policies.
Applying these principles, unable to accurately assess some elements of the budget,
sometimes involves the adoption of estimates and assumptions that can also significantly
affect the values of the balance sheet and income statement.
Reiterating that the use of reasonable estimates is an essential part of preparing the budget,
indicate below the budget items where it is most significant use of estimates and
assumptions:
    credit rating;
    valuation of financial assets not quoted in active markets;
    evaluation of intangible assets and investments;
    quantification of the provisions for risks and charges;
      quantification of deferred tax assets;

      definition of the depreciation of tangible and intangible assets with finite useful
        lives.

In this regard, it also shows, as the correction of an estimate may be a result of changes in
circumstances over which it was based or as a result of new information, or even more
experience. Any change in estimate is applied prospectively, and thereby impact on the
income statement for the year in which change occurs and, if applicable, on future periods.

This exercise is characterized by a significant change in estimate criteria were applied to the
financial statements at December 31, 2009.

                                                 *******
The amendments to IAS 39
Given that the process of complete revision of IAS 39 is still in progress and should be
completed by the end of the first half of 2011, we note that at present any document issued
by the IASB was subject to approval by the European Commission.

                                                                                                  77
The following is a brief summary on the status of revision of that principle.

Phase 1 Classification and Measurement
On 12 November the International Accounting Standards Board (IASB) has approved the
final version of IFRS 9 "Financial Instruments", The new standard intended to replace the
requirement for the classification and measurement of financial assets, IAS 39" Financial
instruments: measurement and classification ", bringing out the first phase of the overhaul
of that accounting.
This principle, given the criticism received during the comment period has not yet been
subject to approval by the European Commission and is therefore not currently applicable
to the financial statements of European companies and therefore the process of approval, cd
"Endorsement" in relation to this first phase of the revision of IAS 39 has been postponed.

On October 28, 2010, the IASB published new estimates of the classification and
measurement of financial liabilities. In particular, it points out that these new estimates,
confirming the basic approach already under IAS 39, require a general rule, when applied to
the fair value option to financial liabilities, the detection of changes in value attributable to
its credit in Statement of Overall Profitability rather than to income.


Step 2 Impairment
On November 5, 2009, the IASB has published for consultation which is the usual ending
June 30, 2010, the Exposure DraftFinancial Instruments; Amortised Cost and Impairment".
This draft document, which provides for the revision of methods of determining impairment
of all financial assets at amortized cost in the form cd expected loss (involving the
recognition of expected losses over the entire duration of the contract), has been criticized
by several commentators, especially with regard to the complexity of application and
practical applicability to non-cd wallets "Open" so that the IASB on 31 January 2011
published in consultation, jointly with the FASB, the Supplement
"Financial Instruments: Impairment " supplement the above AND Financial Instruments:
Amortised Cost Impairment and published in 2009, whose aim is to overcome the main
problems and operational problems feared by commentators in the implementation of the
proposed model for calculating the expected loss.


Step 3 Hedge Accounting
On December 9, 2010, the IASB published for the usual consultation which ended March 9,
2011, the Exposure DraftHedge Accounting".
The ED in question, which is not the issue remains controversial and subject to further
investigations of the cd "Macrohedging", aims, intended by the IASB, essentially aims to:
     ·   logical approach to the accounting treatment of risk management;
     ·   principle to introduce a more focused objective to be achieved with
         the conclusion of coverage and the manner in which it intends to achieve.

More specifically, an overview of the new features offered by EDA include the following:
     ·   change the type of hedge accounting fair value hedge;
     ·   Introducing the possibility of re-weighting the ratio of hedging hedging
         relationships, using the cd "Rebalancing", though still in line with the initial aim;
     ·   Introducing the possibility to make a cd cover in a logic to "layer approach";
     ·   the ability to cover net positions;


78
   ·   80-125% elimination of mandatory threshold for quantitative tests made to ensure
       the effectiveness of the audit;
   ·   removing the possibility of financial instruments which cover assessment will not
       impact the income statement;
   ·   accounting of the time value of premium options.

To complete the project in question, the IASB added a further stage Asset and Liability
Offsetting.
In this regard, on January 28, 2011, the IASB issued an Exposure DraftOffsetting
Financial Assets and Financial Liabilities " whose goal is to address the issue of balance
sheet netting of positions on derivatives and other financial instruments which may result
in significant differences in the reporting of financial institutions.




                                                                                             79
List of IAS / IFRS endorsed by the European Commission
IAS /
IFRS                          ACCOUNTING                                  APPROVAL

                                                                       Reg 1274/2008,
IAS 1    Presentation of Financial Statements                          53/2009, 70/2009,
                                                                       494/2009, 243/2010,
                                                                       149/2011
IAS 2    Inventories                                                   Reg 1126/2008
                                                                       Reg 1126/2008,
IAS 7    Statement of Cash Flows                                       1274/2008, 70/2009,
                                                                       494/2009, 243/2010

IAS 8    Accounting Policies, Changes in Accounting Estimates and Errors Reg 1126/2008,
                                                                         1274/2008, 70/2009
                                                                       Reg 1126/2008,
IAS 10   Events after the balance sheet date                           1274/2008, 70/2009,
                                                                       1142/2009

IAS 11   Construction Contracts                                        Reg 1126/2008,
                                                                       1274/2008

IAS 12   Income Taxes                                                  Reg 1126/2008,
                                                                       1274/2008, 495/2009
                                                                       Reg 1126/2008,
IAS 16   Property, plant and equipment                                 1274/2008, 70/2009,
                                                                       495/2009

IAS 17   Leasing                                                       Reg 1126/2008,
                                                                       243/2010
IAS 18   Revenues                                                      Reg 1126/2008, 69/2009

IAS 19   Employee Benefits                                             Reg 1126/2008,
                                                                       1274/2008, 70/2009

IAS 20   Accounting for Government Grants and Disclosure               Reg 1126/2008,
         Government Assistance                                         1274/2008, 70/2009
                                                                       Reg 1126/2008,
IAS 21   The Effects of Changes in Foreign Exchange Rates              1274/2008, 69/2009,
                                                                       494/2009, 149/2011
IAS 23   Borrowing Costs                                               Reg 1260/2008, 70/2009
IAS 24   Disclosures on related party transactions                     Reg 632/2010
IAS 26   Pension funds                                                 Reg 1126/2008
IAS 27   Consolidated and Separate                                     Reg 494/2009
                                                                       Reg 1126/2008,
IAS 28   Investments in associates                                     1274/2008, 70/2009,
                                                                       494/2009, 495/2009,
                                                                       149/2011

IAS 29   Financial reporting in hyperinflationary economies            Reg 1126/2008,
                                                                       1274/2008, 70/2009
                                                                       Reg 1126/2008,
IAS 31   Interests in Joint Ventures                                   70/2009, 494/2009,
                                                                       149/2011
                                                                       Reg 1126/2008,
IAS 32   Financial Instruments: Presentation                           1274/2008, 53/2009,
                                                                       70/2009, 495/2009,
                                                                       1293/2009, 149/2011


80
IAS 33    Earnings per share                                             Reg 1126/2008,
                                                                         1274/2008, 495/2009
                                                                         Reg 1126/2008,
IAS 34    Interim reports                                                1274/2008, 70/2009,
                                                                         495/2009, 149/2011
                                                                         Reg 1126/2008,
IAS 36    Impairment of assets                                           1274/2008, 69/2009,
                                                                         70/2009, 495/2009,
                                                                         243/2010

IAS 37    Provisions, Contingent Liabilities and Contingent Assets       Reg 1126/2008,
                                                                         1274/2008, 495/2009
                                                                         Reg 1126/2008,
IAS 38    Intangible assets                                              1274/2008, 70/2009,
                                                                         495/2009, 243/2010
                                                                         Reg 1126/2008,
                                                                         1274/2008, 53/2009,
IAS 39    Financial Instruments: Recognition and Measurement             70/2009, 494/2009,
                                                                         495/2009, 824/2009,
                                                                         839/2009, 1171/2009,
                                                                         243/2010, 149/2011

IAS 40    Investment Property                                            Reg 1126/2008, Reg
                                                                         1274/2008, Regulation
                                                                         70/2009

IAS 41    Agriculture                                                    Reg 1126/2008,
                                                                         1274/2008, 70/2009
                                                                         Reg 1126/2009,
IFRS 1    First-time Adoption of International Accounting Standards      1164/2009, 550/2010,
                                                                         574/2010, 662/2010,
                                                                         149/2011
                                                                         Reg 1126/2008,
IFRS 2    Share-based payments                                           1261/2008, 495/2009,
                                                                         243/2010, 244/2010
IFRS 3    Business Combinations                                          Reg 495/2009, 149/2011

IFRS 4    Insurance Contracts                                            Reg 1126/2008,
                                                                         1274/2008, 1165/2009
                                                                         Reg 1126/2008,
IFRS 5    Non-current Assets Held for Sale and Discontinued Operations   1274/2008, 70/2009,
          Discontinued                                                   494/2009, 1142/2009,
                                                                         243/2010
IFRS 6    Exploration for and Evaluation of Mineral Resources            Reg 1126/2008
                                                                         Reg 1126/2008,
                                                                         1274/2008, 53/2009,
IFRS 7    Financial Instruments: Disclosures
                                                                         70/2009, 495/2009,
                                                                         824/2009, 1165/2009,
                                                                         574/2010, 149/2011
                                                                         Reg 1126/2008,
IFRS 8    Operating Segments                                             1274/2008, 243/2010,
                                                                         632/2010


SIC /
IFRIC                       PAPERS BY                                       APPROVAL

IFRIC 1   Changes in existing decommissioning liabilities,               Reg 1126/2008,
          restoration and similar liabilities                            1274/2008
          Members' Shares in Cooperative Entities and Similar            Reg 1126/2008,
IFRIC 2   Instruments
                                                                         53/2009

81
IFRIC 4    Determining whether an arrangement contains a lease              Reg 1126/2008,
                                                                            70/2009

IFRIC 5    Rights to interests arising from decommissioning,                Reg 1126/2008
           restoration and environmental

IFRIC 6    Liabilities arising from Participating in a Specific Market      Reg 1126/2008
           - Waste electrical and electronic

IFRIC 7    Applying the Restatement Approach under the                      Reg 1126/2008,
           IAS 29 "Financial reporting in hyperinflationary economies"      1274/2008
                                                                            Reg 1126/2008,
IFRIC 9    Reassessment of Embedded Derivatives                             495/2009, 1171/2009,
                                                                            243/2010

IFRIC 10   Interim Financial Reporting and Impairment                       Reg 1126/2008,
                                                                            1274/2008

IFRIC 12   Service Concession Agreements                                    Reg 254/2009

IFRIC 13   Customer Loyalty Program                                         Reg 1262/2008,
                                                                            149/2011

IFRIC 14   Advance payments relating to a funding requirement               1263/2008 Reg, Reg
           minimum                                                          1274/2008, 633/2010

IFRIC 15   Agreements for the construction of buildings                     Reg 636/2009

IFRIC 16   Hedges of a net investment in foreign operations                 Reg 460/2009, Reg
                                                                            243/2010

IFRIC 17   Distributions to shareholders are not represented by activity    Reg 1142/2009
           Cash

IFRIC 18   Transfers of assets from customers                               Reg 1164/2009

IFRIC 19   Settlement of liabilities with financial instruments             Reg 662/2010
           capital

SIC 7      Introduction of the Euro                                         Reg 1126/2008,
                                                                            1274/2008, 494/2009

SIC 10     Government assistance - no specific relation to the activities   Reg 1126/2008,
           operational                                                      1274/2008

SIC 12     Consolidation - Special Purpose Entities (Society                Reg 1126/2008
           vehicle)

SIC 13     Joint ventures - Contributions in kind from                      Reg 1126/2008,
           of participants in the control                                   1274/2008

SIC 15     Operating Leases - Incentives                                    Reg 1126/2008,
                                                                            1274/2008

SIC 21     Income Taxes - Recovery of revalued non-                         Reg 1126/2008
           depreciable

SIC 25     Income Taxes - Changes in the tax status of                      Reg 1126/2008,
           company or its shareholders                                      1274/2008
           The assessment of the substance of transactions involving the
SIC 27     legal form                                                       Reg 1126/2008
           leasing

SIC 29     Disclosure - service concession arrangements                     Reg 1126/2008,
                                                                            1274/2008, 70/2009

SIC 31     Revenue - barter transactions involving advertising services     Reg 1126/2008

SIC 32     Intangible Assets - Web Site Costs                               Reg 1126/2008,
                                                                            1274/2008



82
A.2 - The Main budget items

Here are, for the main budgetary aggregates, the criteria for recognition, classification,
assessment and cleanup.

Financial assets and liabilities held for trading
Definition of financial assets and liabilities held for trading
An asset or financial liability is classified as held for trading (cd Fair Value Through Profit or
Loss - FVPL), and registered under "Financial assets 20 held for trading "or under" 40
Financial liabilities held for trading ", if it is:
        acquired or incurred principally for the purpose of selling or repurchasing in the
        short;
        part of a portfolio of identified financial instruments that are managed together and
        for which there is evidence of a recent actual pattern directed at obtaining a profit in
        the short term;
        a derivative (except for a derivative that is designated and effective hedging
        instrument - see specific next paragraph).

The Bank has listed the "Financial assets held for trading" where these debt securities held
for trading and PCT.

Financial derivatives
We define "derivative" of a financial instrument or other contract with the following features:
        its value changes in relation to changes in interest rate, the price of a financial
        instrument, the price of a commodity, foreign currency exchange rate, index of prices
        or rates, credit or credit index or other variable;
        does not require an initial net investment or requires an initial net investment
        smaller than would be required for other types of contracts that one would expect a
        similar response to changes in market factors;
        is set at a future date.

The Bank holds derivative financial instruments for trading or for hedging purposes (see
them at the next special section). All trading derivatives are recognized in the industry to an
initial value equal to fair value which generally coincides with the cost. Subsequently, the
derivative contracts are valued at fair value, Equal to the value that the Bank would pay or
receive to terminate in the event, the time of evaluation, the derivative contract. Each
variation found in fair value is charged to the income statement under "Net income from
trading 80.
The fair value derivatives is determined by applying the methods described in the section
"assessment criteria".

Embedded derivative financial instruments
An "embedded derivative" component of a hybrid (combined) contract that also includes a
primary derivative, the effect that some of the cash flows of the combined instrument vary in
a way similar to the derivative of its own . The embedded derivative is separated from the
host contract and accounted for as a stand-alone derivative if and only if:
        the economic characteristics and risks of the embedded derivative are not closely
        related to the economic characteristics and risks of the host contract;
        a separate instrument with the same terms as the embedded derivative would meet
        the definition of a derivative;
        the hybrid (combined) is not shown as assets or financial liabilities held for trading.


                                                                                                     83
The fair value decomposed derivatives is determined by following the methods described in
the section "assessment criteria".

Criteria for inclusion
Financial instruments "financial assets and liabilities held for trading are recognized at the
time of regulation, whether debt or equity, or the date of execution, if the derivative
contracts, at a value equal to the cost defined as the fair value instrument, regardless of any
costs or income directly attributable to the instruments themselves.

Evaluation criteria
After initial recognition, financial instruments in question are valued at fair value charged
with the variations observed in the income statement under "80 Net income from trading. "
The determination of fair value assets or liabilities of a trading book is based on prices in
active markets or internal valuation models generally used in financial and described below.

Methods of determining the fair value
securities: listed and unlisted
In the case of securities listed on active markets, the determination of fair value is based on
prices quoted by market (ie the one where you experience the greatest volume of trading)
may be drawn from international providers and found the last day of reference year or
period. A market is defined as active if the prices reflect normal market operations, are
readily and regularly available and express the price of actual and regularly occurring
market.
In the case of unlisted securities fair value is determined using valuation techniques aimed
at determining the price that the instrument would have on the valuation date in a free
exchange motivated by normal business considerations. The determination of fair value is
obtained through the application of methodologies with broad international markets and
internal valuation. In particular, unlisted bonds apply models of discounting expected
future cash flows - using structures of interest rates that appropriately take into account
the sector of activity of the issuer and rating class, if available - and option pricing models.
For equity prices are used can be derived from comparable transactions, market multiples
of comparable companies directly, as well as model type evaluation sheet, income and
mixed.

Derivatives: listed and unlisted
In the case of the determination of listed derivatives fair value is based on prices derived
from active markets. For derivatives not listed on the fair value is determined by applying
models of discounting future cash flows that also ponder the credit risk associated with the
financial instrument. In the case of derivative transactions with institutional counterparties,
taking into account netting agreements (known as CSA) aimed at mitigating credit risk, it is
considered that this risk could be considered virtually nil.

Cancellation Policy
The "financial assets and liabilities held for trading" are derecognised when the contractual
rights on cash flows from financial assets or liabilities, or when the financial asset or
liability is transferred with the transfer of substantially all the risks and benefits of the same
property. The result of the sale of assets or financial liabilities held for trading are
recognized in the income statement under "Net income from trading 80.




84
Financial assets available for sale
Definition
We define available for sale (cd available for sale - AFS) those non-derivative financial assets
that are designated as such or are not classified as:
    (1) credits and loans (see next paragraph);
    (2) Financial assets held to maturity (see next paragraph);
    (3) financial assets held for trading and measured at fair value profit or loss (see
         previous paragraph).

These financial assets are posted to the "40 Financial assets available for sale."

Criteria for inclusion
The financial instruments available for sale are initially recognized when, and only when,
the company became part of the contractual terms of the instrument, ie the time of
settlement, to a value equal to fair value generally coincides with the cost of the same. This
figure includes the costs or revenues directly related to the instruments themselves.
The inclusion of financial assets available for sale may also result from reclassification by
the sector "Financial assets held to maturity" or it only in rare circumstances and in any
case only if the activity is no longer held for the purpose of selling or repurchasing in short,
by the sector "Financial assets held for trading" under these circumstances the carrying
value is equal to fair value activity at the time of transfer.

Evaluation criteria
After initial recognition, financial assets available for sale continue to be valued at fair value
recognized in the income statement of the interest portion (as indicated by the overall
amortized cost) and charged to equity under "Revaluation reserves 130" of changes in fair
valueExcept for impairment losses, until the financial asset is derecognised, at which time
the gain or loss previously recognized in equity total shall be recognized in the income
statement. Equity securities that can not be defined reliably the fair valueAccording to the
methods shown are recorded at cost.

At each annual or interim financial statements is carried out to verify the existence of
objective evidence of impairment that, in the case of equity securities, we also consider it
significant or prolonged.
With reference to the significance of impairment, it was in the presence of significant signs
of impairment when the market value of the stock is lower by more than 35% compared to
historical cost. In this case we shall, without further analysis, accounting for impairment
loss. In the case of impairment of less to account for the impairment only if the assessment
of the security on the basis of its fundamental not confirm the soundness of the company or
its future earnings prospects.
With reference to the durability of the reduction in value, this is defined as prolonged if the
fair value remains continuously below the value of the historical cost of purchase for a
period exceeding 18 months: in that case the impairment to the accounting profit without
any economic analysis. In the event of continuous stay in the fair value below the value of
historical cost for periods of less than 18 months, any impairment to be charged to the
income statement is found also in view of the fact that the impairment is due to a general
downward trend in stock market rather than the specific performance of the single party.



                                                                                                     85
In the presence of impairment, the cumulative variation, previously entered in
Shareholders in the aforesaid item is included directly in the income statement under "130
Adjustments / recoveries on impairment of b) financial assets available for sale. "
The impairment loss is recorded when the cost of acquisition (net of any repayment of capital
and depreciation) of available-for-sale financial asset exceeds its recoverable amount. Any write-
backs, possible only after the removal of the reasons which had given rise to the loss of value,
are thus accounted for:
         if they refer to investments in equity instruments with a direct exchange reserve
         assets;
         if they refer to investments in debt instruments, are recorded in the income
         statement under "130 losses / recoveries on impairment of b) financial assets
         available for sale."

In any case, the strength of the recovery of value can not exceed the amortized cost of the
instrument, in the absence of previous adjustments, would have had to that point.

In light of the fact that the Bank applies IAS 34 "Interim Financial Reporting" to the yearly
financial statements, resulting in identification of an "interim period" every six months, any
reductions in value are historicized in the end of the semester.

Methods of determining the fair value
Please refer to the section on financial assets and liabilities held for trading ".

Cancellation Policy
Financial assets available for sale are derecognised when the contractual rights on cash
flows from financing activities, or when the financial asset is transferred with the transfer of
substantially all the risks and benefits of ownership of the asset. The result of the sale of
financial assets available for sale is charged to the income statement under "100 Profit (loss)
on disposal or repurchase of b) financial assets available for sale." At the time of
cancellation shall also zeroing against the income statement corresponding to the case
where part of what was previously charged in reserve assets
"130 Revaluation reserves".



Credits and Loans
Definition
Loans and receivables are defined as (cd Loans and Receivables - L & R) non-derivative
financial assets, with fixed or determinable payments that are not quoted in an active
market. Exceptions:
     a) those who intend to sell immediately or in short, that are classified as held for
          trading, and those that may be recognized at the time of initial recognition fair value
          profit or loss;
     b) those initially recorded as available for sale;
     c) those for which the holder may not recover substantially all of the initial investment
          for reasons other than deterioration of credit, in which case they are classified as
          available for sale.

The Loans and receivables are recorded under "60 Due to banks" and "70 Loans to
customers".
The Bank includes loans between loans to customers and banks, whether provided directly
or purchased from third parties also fall into this category commercial loans, repurchase
agreements, loans originated by financial leasing and factoring and postal savings.



86
Criteria for inclusion
The loans and receivables are recognized initially when the company becomes part of a
financing contract that is when the creditor acquires the right to pay the amounts
contractually agreed. That date is the date of disbursement of the loan.
Membership in this category may also result from reclassification of the Fund "Financial
assets available for sale" or, only in rare circumstances and only if the activity is no longer
held for the purpose of selling or repurchasing in the short, the "Financial assets held for
trading ".
The initial carrying value is equal to fair value financial instrument that corresponds to the
amount paid including transaction costs and income directly attributable to it and
determinable from the outset, regardless of when they are liquidated. Not included in the
initial carrying value of all charges which are reimbursed by the debtor or counterparty
which are based on internal administrative costs.
If the registration resulting from reclassification, fair value activity detected at the time of
transfer, shall be employed as a new measure of the amortized cost of the asset.
In the case of credits and loans to non-market conditions, the fair value Initial is calculated
by applying the appropriate valuation techniques illustrated below, in such circumstances,
the difference between the fair value so determined and the amount paid is included directly
in the income statement under interest.
The contango contracts and repurchase transactions with repurchase or repo transactions
are recognized as the collection or use. In particular, the sales transactions in cash and
repurchase agreements are recorded as liabilities in the budget for the amount received
spot, while the repo transactions and repo transactions are recorded as a credit for the
amount paid to ready.

Evaluation criteria
The loans and receivables are measured at amortized cost using the effective interest
method.
The amortized cost of an asset or financial liability is the amount at which it was measured
at initial recognition less principal repayments, plus or minus the total using the effective
interest method of any difference between the initial amount and the maturity amount and
minus any reduction (due to an impairment or recoverability).
The effective interest method is a method of calculating the amortized cost of an asset or
financial liability (or group of financial assets and liabilities) and of allocating the interest
income or interest expense over its duration. The effective interest rate is the rate that
exactly discounts estimated future cash payments or receipts through the expected life of
the financial instrument. In the determination of the effective interest rate is necessary to
evaluate cash flows considering all contractual terms of the financial instrument (for
example, the prepayment option to purchase or similar), but should not be considered for
future losses on credits. The calculation includes all fees and points paid or received
between parties to a contract that are an integral part of effective interest rate, transaction
costs, and all other premiums or discounts.

At each balance sheet date or interim financial statements is found to have any objective
evidence that a financial asset or group of financial assets has been impaired in value. This
circumstance occurs when it is foreseeable that the company is unable to collect the
amount due, according to the contractual terms that, for example, in the presence of:
    a) significant financial difficulty of the issuer or obligor;
    b) a breach of contract, such a default or failure to pay interest or principal;
    c) the fact that funding for economic or legal reasons relating to the financial
         difficulties of the beneficiary, the beneficiary extends a concession that the lender
         would not otherwise consider;
    d) the likelihood that the recipient state financial reorganization;


                                                                                                    87
     e) the disappearance of an active market for that financial asset because of financial
          difficulties;
     f) of observable data indicating that there is a measurable decrease in estimated future
          cash flows for a group of similar financial assets since the initial recognition of those
          assets, although the decrease can not yet be identified with the individual financial
          assets in the Group.

The evaluation of non-performing loans (loans that, according to the definitions assigned by
the Bank of Italy, are in a state of distress, substandard, restructured due exposure,
including exposures from 90 to 180 days overdrafts secured by real estate) occurs in a
manner analytical. The evaluation of the remaining credits shall be according to technical
group through grouping into classes of risk.

The criteria for the determination of the impairment to be made to non-performing loans are
based on the expected cash flows of principal and interest, taking into account any
guarantees securing positions and any advances received. In determining the present value
of cash flows, the key elements are represented by the box office estimates, the timing of
payments and the discount rate to apply. The amount of loss is equal to the difference
between the asset and the present value of expected future cash flows discounted at original
effective interest rate.

The evaluation of the performing loans (positions performing and country risk exposures) of
loans for which no indicators of impairment were found and therefore are subject to a
collective assessment. For the estimated cash flows of the assets, aggregated into classes
with similar characteristics in terms of credit risk, loss rates are applied can be derived from
statistical time series estimated for the Group's banking network, according to the
evaluation methodology based on legislation Basel 2.

Impairment losses are recognized immediately reported to the income statement under
"130 losses / recoveries on impairment of a) loans" as well as recovery of any and all
amounts subject to impairments. The backs are recorded and compared to an improved
credit quality that can render a reasonable assurance of timely recovery of principal and
interest, according to the contractual terms of credit, both at the front of the progressive
disappearance of discounting calculated at the time of the adjustment in value. In the case
of collective evaluation, any additional adjustments or write-backs are recalculated
differentially with respect to each claim in performing the valuation date.

Methods determining Fair Value
The fair value credits and loans is determined by considering the future cash flows,
discounted at the rate of substitution that is at the market rate at the date of assessment to
a position with similar characteristics to credit being evaluated. The Fair Value is
determined for all claims for the sole purpose of information. In the case of loans and
receivables hedged effective, is calculated fair value in relation to the hedged risk for
evaluation purposes.

Cancellation Policy
The loans and receivables are derecognised when the contractual rights on cash flows
arising from the same or where those assets are transferred with the transfer of
substantially all the risks and benefits of ownership. Otherwise, the loans and continues to
be recognized in the financial statements, although their legal ownership is transferred to a
third party for an amount equal to the continuing involvement.
The activities in question are derecognised when the bank also maintains a contractual
right to receive cash flows from the same, but takes on the same contractual obligation to
pay the same flows to a third party.
The economic result of the transfer of credits and loans is charged to the income statement
under "100 Profit (loss) on disposal or repurchase of a) loans."

88
Hedging derivatives
Definition
Hedging transactions are intended to counteract the losses on a particular item (or group of
items) attributable to a particular risk through profits detectable on a different element (or
group of elements) if that risk should actually occur .
The Bank gives rise to the following hedging relationship, which is consistent accounting
treatment, and which is described hereinafter:
        Fair Value Hedge: The objective is to counteract adverse changes fair value asset or
        liability being hedged;
        Cash Flow Hedge: The purpose is to counter the risk of variability expected cash
        flows compared to the initial hypotheses.

Derivatives entered into with counterparties outside the company are designated as hedging
instruments.

Criteria for inclusion
The instruments of hedging, like all derivatives, are initially recognized and subsequently
measured at fair value and in heading of balance sheet assets "80 derivatives hedging and
balance sheet liabilities" 60 Hedging derivatives.

A relationship qualifies for hedge accounting, and accounting treatment is consistent, if and
only if all the following conditions are met:
        the top cover there is a formal designation and documentation of the hedging
        relationship, the objectives of the companies in risk management and strategy for
        undertaking the hedge. This documentation includes identification of the hedging
        instrument, the item or operation covered, the nature of risk covered and how the
        company evaluates the effectiveness of the hedging instrument in offsetting the
        exposure to changes in fair value or cash flows of the hedged item attributable to the
        hedged risk;
        coverage is expected to be highly effective;
        the hedged forecast transaction, for cash flow hedges,
        is highly probable and presents an exposure to variations in cash flows that could
        affect profit or loss;
        hedge effectiveness can be measured reliably;
        the hedge is assessed on the basis of a policy of continuity and is considered highly
        effective for all periods of reference for which the hedge was designated.

Methodology of test effectiveness
The hedging relationship is deemed effective, and as such is consistent accounting
treatment, if the beginning and during his life changes in the fair value or cash flows of the
hedged item, related to the hedged risk, are almost completely offset by changes in fair value
or cash flows of the hedging derivative.
This conclusion is reached when the actual result falls within a range between 80% and
125%.
Assessing the effectiveness of the cover is at an early stage through the execution of the test
and perspective when preparing the annual budget by running the backtesting, the outcome
of this test justifies the application of hedge accounting as demonstrates its effectiveness
pending.
On a monthly basis is also conducted testing on a cumulative basis, which aims to measure
the degree of effectiveness of the coverage achieved during the reporting period, and then
verify that in the period the hedging relationship has actually been effective.

                                                                                                  89
Derivative financial instruments that are considered to hedge the economic point of view,
but do not meet the requirements for being considered as effective hedging instruments, are
recorded in "20 Financial assets held for trading" or "40 Financial liabilities held for trading
and economic effects in the corresponding entry "80 Net income from trading."
For a description of the methods used in the calculation of Fair value derivatives can be
found in what is written in "financial assets and liabilities held for trading".

Evaluation criteria
Coverage of Fair Value
The coverage of fair value is accounted for as follows:
         the gain or loss resulting from the measurement of the hedging instrument to fair
         value is entered in the income statement under "Net result 90 coverage;
         the gain or loss on the hedged item attributable to the hedged risk adjusts the
         carrying value of the hedged item and is recognized immediately, regardless of the
         category of the asset or liability being hedged, in the income statement as described
         above.

The cease hedge accounting prospectively when:
     1. the hedging instrument expires or is sold, terminated or exercised;
     2. the hedge no longer meets the criteria for hedge accounting on these;
     3. the company revokes the designation.

In the case sub 2, where the asset or liability being hedged are measured at amortized cost,
the greater or lesser value derived from the assessment itself fair value the effect of the
coverage has become ineffective is recognized in the income statement on an effective
interest rate method applicable at the time of lifting of the cover.
The methods used in the determination of fair value the hedged risk in the hedged asset or
liability are described in the paragraphs of commentary on financial assets available for
sale, loans and receivables.


Cash flow hedges
When a derivative financial instrument is designated to hedge the variability of expected
cash flows from an asset or liability recorded in the budget or a future transaction
considered highly probable, the hedge accounting is as follows:
 gains or losses (the assessment of the hedging derivative) linked to the effective portion of
    the hedge are recorded in the equity reserve called "130 Revaluation reserves";
 gains or losses (the assessment of the hedging derivative) linked to the ineffective portion
    of hedges are recorded directly in the income statement under "Net income from hedging
    activities 90;
 the asset or liability being hedged is valued according to the criteria of class membership.

If a future transaction occurs leading to the entry of a non-financial assets or liabilities, the
corresponding gains and losses initially recognized in "130 Revaluation reserves" are
simultaneously transferred from the reserve and charged as a cost or liability covered by the
initial activity detection. If the hedged future transaction subsequently results in the
inclusion of a financial asset or liability, the gains or losses associated with that were
initially recognized directly in "130 Revaluation reserves" are reclassified to the income
statement in the same period or periods during which the assets acquired and liabilities
assumed has an effect on the income statement. If some of the profits or losses allocated to
these concerns is not


90
considered recoverable, is reclassified to the income statement under "Net income from
trading 80.

In all cases other than those described above, the gains or losses initially recognized in "130
Revaluation reserves" are written off and expensed in the same manner and the same dates
by which the future transaction affects the income statement .

In each of the following circumstances a company must prospectively cease hedge
accounting:
(a) the hedging instrument expires or is sold, terminated or exercised (for this purpose, the
      replacement or carry-over of a hedging instrument with another hedging instrument is
      not a conclusion or termination if such replacement or deposition is part of the
      documented hedging strategy) investments. In this case, the gain (or loss) of the hedging
      instrument is recognized directly in equity until the year in which the hedge was
      effective and remains separately recognized in equity until the forecast transaction,
      hedged occurs;
(b) the hedge no longer meets the criteria for hedge accounting. In this case, the overall
      gain or loss on the hedging instrument is recognized directly in equity as from where
      coverage was effective remains separately recognized in equity until the forecast
      transaction occurs;
(c) no longer considered that the proposed transaction should occur, in which case any
      related gain or overall loss on the hedging instrument is recognized directly in equity
      from the exercise in which the hedge was effective must be recorded in the income
      statement;
(d) the company revokes the designation. For hedges of a forecast transaction, the overall
      gain or loss on the hedging instrument is recognized directly in equity as from where
      coverage was effective remains separately recognized in equity until the forecast
      transaction occurs or expected should not happen again.

If it is expected that the transaction should not happen again, the profit (or loss) that was
recognized directly in equity is reversed to income.


Hedging portfolios of assets and liabilities
The hedging of portfolios of assets and liabilities (the "macrohedging") and consistent
accounting treatment is possible after:
        identification of the hedged portfolio and the division of the same maturity;
        designation of the subject of coverage;
        identification of the risk of interest rate hedges;
        designation of hedging instruments,
        determination of efficacy.

The portfolio hedging of interest rate can contain both activity and passivity. This portfolio is
divided according to the schedule of collection or
Repricing of rate after an analysis of the structure of cash flows.
Changes in fair value recorded on the hedged item are recognized in the income statement
under "Net income from hedging in 1990 and in the balance sheet item" 90 Fair value of
financial assets in hedged "or" 70 Fair value of financial liabilities generic coverage. "
Changes in fair value recorded on the hedging instrument are recognized in the income
statement under "Net income from hedging in 1990 and active in the balance sheet in"
Hedging 80 "or heading of the balance sheet liability" 60 Hedging derivatives.


                                                                                                    91
Investments
Definition
Subsidiaries
Is defined as "controlled" society in which the Bank exercises control. This condition exists
when it has the power to determine, directly or indirectly, to govern the financial and
management company so they can get their benefits. To determine the presence of control,
assessed the presence of potential voting rights exercisable immediately. Investments in
subsidiaries are included in the budget from the date when you start to exercise control and
as long as it remains outstanding. Investments in subsidiaries are accounted for using the
cost method.

Associates
An "connected" society in which the Group holds at least 20% of the voting rights or where
the investor exercises significant influence and which is neither a subsidiary nor a joint
subsidiary for the participant. Significant influence is the power to participate in the
determination of financial and operating policies of the investee but is not control or joint
control. Investments in associates are accounted for using the equity method.

Participation in jointly controlled
Is defined as "jointly controlled" society governed by a contractual arrangement whereby two
or more parties undertake an economic activity subject to joint control.
Investments in joint ventures are recognized in the accounts by adopting the equity method
or the proportional method.

Recognition and evaluation
The item includes investments in companies directly controlled by and / or affiliates and
minority interests in subsidiaries and / or connected to / from other companies within the
Group, entered in the balance sheet at cost. Minority interests held by the Bank are
included in "Financial assets available for sale" accounting treatment which has been
previously described.
If there is evidence that the value of an investment may be impaired, we proceed to estimate
the recoverable amount of the investment, taking into account the present value of future
cash flows that may be generated, including the value of its ultimate disposal . Where the
recoverable amount is less than book value, the difference, if considered of a permanent
character, is recognized in the income statement. If the reasons for impairment cease to
exist following an event occurring after the recognition of impairment, are carried out with
charge-backs to the income statement, as far as historical cost.

Cancellation Policy
Investments are derecognised when the contractual rights to cash flows from the assets
expire or when the financial asset is disposed of by transferring substantially all the risks
and benefits associated with it.



Tangible assets
Assets used in the definition
They are called "Operating assets" tangible assets held for use for the performance of social
activity and the use of which has been assumed over a greater period of time.



92
Definition of assets held for investment purposes
Are defined as "Assets held for investment" properties held with the aim to earn rentals or
for capital appreciation. Consequently, an investment property to be distinguished from
held for use by the owner to the fact that cash flows largely differentiated from other assets
held by the Bank.

Recompressed are among the tangible assets (for operational use and held for investment),
even those registered as a result of financial leasing contracts, although the legal title
remains in the same head lessor company.

Criteria for inclusion
Tangible assets, equipment or not, are recognized initially at an amount equal to the cost
(In "110 Activities Materials"), inclusive of all costs directly related to the operation of the
property, and taxes and fees non-refundable purchase. This value has subsequently
increased its expenses incurred which are expected to enjoy the future benefits. The costs of
routine maintenance performed on the activity are recorded in the income statement when
they occur against the costs of maintenance (improvements) from which future economic
benefits are capitalized to the value of the related assets.
Improvements and incremental expenses incurred on leased assets from which benefits are
expected to come are registered:
        if equipped with self-identifiability and separability in "110 Tangible assets" in the
        category most appropriate, whether they relate to third-party assets used pursuant
        to a lease that property held under a finance lease;
        if not equipped with self-identifiability and separability in "110 Tangible assets",
        which refers to increased activity when used under a finance lease or under the item
        "150 Other assets" when referring to assets used to effect of a lease.

The cost of a tangible asset is recorded as an asset if, and only if:
        it is probable that future economic benefits associated with the asset will flow to
        the company, the cost of the asset can be reliably determined.

Evaluation criteria
Subsequent to initial recognition, tangible equipment are stated at cost, as defined above,
net of accumulated depreciation and any accumulated impairment losses. The depreciable
amount, equal to the cost less the residual value (ie the amount you would normally
expected from the disposal, after deducting the expected costs of disposal if the asset were
already in the conditions, even in old age, provided at the end of his life profit), is
distributed systematically over the useful life of the material used as criteria for straight-line
depreciation method. The useful life, subject to periodic review in order to detect possible
differ significantly from previous estimates, is defined as:
        the period of time in which it is expected that the activity is used by the company or,
        the number of production or similar units that the company expects to derive from
        the asset itself.

In view of the fact that tangible assets can cover different parts of life, land, whether alone
or included in the value of the building, are not subject to depreciation as assets which it is
associated with indefinite useful lives. The spin-off of the value attributable to the land from
the total value of the property is, for all buildings in proportion to the percentage of
ownership. Buildings are depreciated against the above criteria.



                                                                                                     93
Works of art are not subject to amortization because their value is generally set to increase
with the passage of time.
The depreciation of an asset begins when the camera is available for use and ceases when
the asset is derecognised when the relevant date is the latest in which the asset is classified
for sale and the date of derecognition . Therefore, depreciation does not cease when the
asset becomes idle or is retired from active use unless the asset is fully depreciated.
Improvements and incremental expenses are amortized:
        if equipped with self-identifiability and separability, according to the assumed life as
        described above;
        if not equipped with self-identifiability and separability in the case of property used
        under a lease, as the shorter period from that in which improvements and
        expenditures can be used and the residual duration of the lease taking into account
        any single renewal, or in the case of property used under a finance lease, according
        to the expected useful life of the asset to which they relate.

The depreciation of the improvements and incremental expenses leasehold found in the
"150 Other Activities" is entered in the "190 Other net operating income".

At each annual or interim financial statements are checked for the possible existence of
signs that demonstrate the value of the depreciation of an asset. The loss resulting from the
comparison between the carrying value of the material and the lower recovery value. The
latter is the greater of fair value, Net of any costs to sell and its value in use ie the present
value of future cash flows generated by the asset. The loss is recorded immediately in the
income statement under "170 Impairment / write-backs on property and equipment" is a
residual including any subsequent recovery in value if the reasons giving rise to the
previous devaluation.

Defining and determining the fair value of
property
The fair value is determined by reference to market value defined as the lowest possible
price at which the sale of a property can reasonably be regarded as unconditionally ended
against monetary compensation to the date of valuation, assuming:
        the seller and buyer are independent parties;
        that the vendor has the intention to dispose of real property;
        that there is a reasonable period of time (considering the type of asset and the
        market situation) to make a proper marketing, agree the price and conditions
        necessary to complete the sale;
        the market trends, the level of value and other economic conditions on the date of
        signing of the preliminary purchase agreement are identical to those existing at the
        date of valuation;
        that any offers from buyers for whom the property has characteristics that it
        considered "off-market" are not taken into account.

The methods used for determining market value are based on the following methods:
        comparative method or the direct market, based on a comparison between the
        property in question and similar ones being sold or currently offered on the same
        competitive market or in squares;
        earnings method based on the present value of the income potential of the market of
        a similar property, obtained by capitalizing the income at a market rate.

The methods mentioned above were performed separately and the values obtained with each
properly mediated.

94
Determination of land value
The methodology used for identifying the percentage of market value attributable to land
was based on an analysis of the location of the property, taking into account the type of
construction, the state of preservation and new construction cost of the entire property.

Tangible assets acquired under finance leases
A finance lease is a contract that transfers substantially all risks and rewards of ownership
of the property. The right to property can be transferred or less at the end of the contract.

The commencement of the lease is the date from which the lessee is entitled to exercise its
right to use the leased asset and therefore corresponds to the date of initial recognition of
the lease.
At the time of the contract period, the lessee accounts for the transactions to finance lease
as assets and liabilities on its balance sheet at amounts equal to fair value the leased
property or, if lower, the present value of minimum lease payments. In determining the
present value of minimum lease payments the discount rate used is the interest rate
implicit contract, if ascertainable, otherwise use the interest rate of the lessee's incremental
borrowing. Any initial direct costs incurred by the lessee are added to the amount
recognized as an asset.

The minimum lease payments are divided between the finance charge and reduction of
outstanding debt. The first are allocated over the contract period to determine a constant
interest rate on the residual liability.
The finance lease results in the recognition of the depreciation of assets under contract and
financial expenses for each financial year. The depreciation method used for assets acquired
in rent is consistent with that for owned assets to which paragraph reference is made for a
more detailed description.

Cancellation Policy
The asset is derecognised upon disposal or when the same is permanently withdrawn from
use and from its disposal are not expected future economic benefits. Any gains or losses
from the retirement or disposal of material, equal to the difference between the net disposal
proceeds and the asset, are recognized in the income statement under "240 Profit (loss) on
disposal of investment. "



Intangible assets
Definition
E 'defined as an intangible non-monetary, identifiable, without physical substance and used
in the performance of social activity.
The asset is identifiable when:
        is separable, ie capable of being separated or divided and sold, transferred, licensed,
        rented or exchanged;
        arises from contractual or other legal rights regardless of whether those rights are
        transferable or separable from other rights and obligations.

The activity is characterized by the fact of being controlled by the enterprise as a result of
past events and the assumption that through its use economic benefits to the company. The
Bank controls an asset if it has the power to take advantage of future economic benefits
arising from the resource and can also restrict access to such benefits by a third party.




                                                                                                   95
The future economic benefits flowing from an intangible asset may include revenue from the
sale of products or services, cost savings or other benefits resulting from the asset by the
Bank.

An intangible asset is recognized if, and only if:
     a) is likely to flow to the expected future economic benefits attributable to the asset;
     b) the cost can be measured reliably.

The likelihood of future benefits is evaluated using reasonable and supportable assumptions
that represent the best estimate of the set of economic conditions that exist over the useful
life.
The degree of certainty attached to the flow of economic benefits attributable to the asset is
valued on the basis of information sources available at the time of initial recognition, giving
greater weight to external sources of information.
The Bank sees goodwill and intangible assets to long-term utility software.

Intangible assets with finite useful life
E 'defined a finite useful life activity for which it is possible to estimate the time limit within
which it is expected the production of the related economic benefits.
Among the members are considered intangible assets with finite useful lives to the software.

Intangible assets with indefinite useful lives
It 'called an indefinite useful life activity that is not possible to estimate a foreseeable limit
to the period during which the activity is expected to generate economic benefits for the
company. The award of an indefinite useful life of the asset does not come from having
already planned future expenditure in the course of time going to restore their standard of
performance, extending the useful life.
Goodwill is considered an indefinite useful life.

Criteria for inclusion
The activity, as recorded in the balance sheet item "120 Intangible Assets", is stated at cost
and the cost after initial recognition are capitalized only if they are able to generate future
economic benefits and if those costs can be determined and attributed to 'work reliably.
The cost of an intangible asset includes:
         the purchase price including any taxes and taxes on purchases is not recoverable
         after deducting trade discounts and rebates;
         any direct cost to the asset into use.

Evaluation criteria
After initial recognition, intangible assets with finite useful lives are stated at cost less
depreciation and total impairment may have occurred. Depreciation is calculated on a
systematic basis over the best estimate of useful life (see definition included in the section
"Tangible Assets") using the straight-line method of distribution.

The depreciation process begins when the asset is available for use and ceases at the date
when the asset is derecognised.

Intangible assets with indefinite useful lives (see start-up, as defined in the following
paragraph if positive) are stated at cost less any impairment losses identified in the
application of the tests conducted periodically to verify the adequacy of the carrying value of
' activities (see next paragraph). For these activities, therefore, does not proceed to the
calculation of depreciation.




96
No intangible asset arising from research (or from the research phase of an internal project)
is the subject of detection. Expenditure on research (or research phase of an internal project)
is recognized as an expense when incurred.
An intangible asset arising from development (or from the development phase of an internal
project) is recognized if, and only if, it can be shown that:
a) the technical feasibility of completing the intangible asset so as to be available for use or
sale;
b) the company's intention to complete the intangible asset and use or sell;
c) the company's ability to use or sell the intangible asset.
At each annual or interim financial statements are checked for the existence of any
impairment losses on intangible assets. These losses are the difference between the
carrying value of assets and the recoverable amount and are recorded as any write-backs, in
"180 Impairment / write-backs on intangible assets" excluding impairment losses relating
to 'start-up that are posted to the "230 Impairment of goodwill."
ZIP
It defines the difference between starting the acquisition cost and the fair value of assets and
liabilities acquired as part of a business combination that consists of the union of companies
or businesses into one company required to prepare financial statements. The result of
nearly all business combinations is the fact that only one company, the acquirer, obtains
control of one or more businesses separate reference to the acquis. When a company
acquires a group of assets or net assets that constitute a business, it allocates the cost of the
assembly to the individual identifiable assets and liabilities based on their fair value at the
acquisition date.
A business combination may result in a participatory relationship between parent and
subsidiary in which the buyer is a subsidiary of the parent and the acquis.
All business combinations are accounted for using the purchase method (so-called purchase
method).
The method involves the following steps:
a) identifying an acquirer (the acquirer is the combining entity that obtains control company
to other companies or businesses aggregate);
b) determining the cost of the business;
c) allocating, at the acquisition date, the cost of the business to the assets acquired and
liabilities and contingent liabilities assumed.
The combination transactions made with companies or subsidiaries of the same group are
accounted for in accordance to the finding of significant economic substance of the same.
Under that principle, goodwill arising from such transactions, is entered:
a) a balance sheet asset item 120 in the case of finding the significant economic substance;
b) a deduction from equity otherwise.
Allocating the cost of a business combination to the assets acquired and liabilities and
contingent liabilities assumed
The buyer:
a) recognizes the goodwill acquired in a business combination as assets;
b) measure that goodwill at its cost, as is the excess of the cost of the business combination
over the acquirer's interest in the fair value of assets, liabilities and contingent liabilities
Goodwill acquired in a business combination represents a payment made by in anticipation of
future economic benefits from assets that can not be individually identified and separately
recognized.
After initial recognition, the buyer evaluates goodwill acquired in a business combination at
cost less accumulated impairment losses.
Goodwill acquired in a business combination should not be amortized. The buyer, however,
shall annually review whether it has suffered an impairment loss, or more frequently if events
or changes in circumstances indicate that might be impaired in value, as described above in
accounting principle.
The principle states that an asset (including goodwill) has been reduced in value when the
carrying amount exceeds the recoverable amount, the latter understood as the higher of fair
value less costs to sell and value in use, defined by par. 6 of IAS 36.
For the purpose of impairment testing of goodwill must be allocated to cash-generating units
or groups of units, subject to the constraint that maximum aggregate can not exceed the
identified segment under IFRS 8.
Negative goodwill
If the acquirer's interest in the fair value (fair value) in cash and assets, liabilities and
contingent liabilities exceeds the cost of the business, the acquirer:
a) reassess the identification and measurement of assets, liabilities and contingent liabilities
and the determination of the cost of;
b) recognizes immediately in profit or loss any excess remaining after re-measurement.
Cancellation Policy
An intangible asset is derecognised as a result of disposal or when no future economic
benefits are expected from its use or disposal.
Loans, securities in circulation (and subordinated debt)
The various forms of interbank and customers are represented in the balance sheet items "10
Due to banks", "20 Due to customers", "30 Securities issued. These items are also included in
the liabilities listed by the lessee under a finance lease.
Criteria for inclusion
The liabilities in question are recorded in the corresponding time upon receipt of the sums
collected or issuing debt securities. The value that is entered is equal to its fair value including
any costs and income directly attributable to the transaction and determined from the outset,
regardless of when they are liquidated. Not included in the initial carrying value of all charges
which are reimbursed by the creditor, or which are based on internal administrative costs.
Evaluation criteria
After initial recognition financial liabilities are measured at amortized cost using the effective
interest rate method as defined above.
Cancellation Policy
Financial liabilities are derecognised when settled or expired.
The repurchase of securities in issue leads to the cancellation of the same amount resulting in
a redefinition of the debt securities issued. Any difference between the value of its share
repurchase and the corresponding amount of the liability is
recognized in the income statement under "100 Profit (loss) on disposal or repurchase of d)
financial liabilities". Any subsequent relocation of its securities, subject to earlier cancellation
accounting is, reversed, resulting in a new issue subscription to the new IPO price, with no
effect on the income statement.
Tax assets and liabilities
The assets and tax liabilities are shown in the balance sheet under "130 Tax assets" and "80
Tax liabilities."
Current tax assets and liabilities
Current tax for current and prior periods, to the extent that they have not been paid, are
recorded as a liability due to any excess is recognized as an asset.
Liabilities (assets) Current tax for the current and prior periods are measured at the amount
expected to be paid / recovered in respect of the taxation authorities, using tax rates and tax
laws in force.
Current tax assets and liabilities are cleared in the period in which the assets are realized or
liabilities are settled.
Deferred tax assets and liabilities
For all taxable temporary differences is recorded a deferred tax liability, unless the deferred
tax liability arises from: goodwill for which amortization is not deductible for tax purposes or
the initial recognition of an asset or liability in a transaction that:
   is not a business combination and
   the time of the transaction affects neither accounting nor taxable profit.
Deferred taxes are not calculated in relation to higher asset values under suspension of taxes
relating to investments in stocks and tax suspension as it is believed, at present, there are no
reasonable assumptions for future charging.
Deferred tax liabilities are recognized in the balance sheet item "80 Tax liabilities b)
deferred."
For all deductible temporary differences is recorded a deferred tax asset if it is probable that
taxable profit will be used against which can be used the deductible temporary difference,
unless the deferred tax asset arises from: negative goodwill which is treated as deferred
income, the initial recognition of an asset or liability in a transaction that:
   is not a business combination and
   the time of the transaction affects neither accounting profit nor taxable profit.
Deferred tax assets are recognized in the balance sheet item "130 Tax assets b) assets".
Deferred tax assets and deferred tax liabilities are continually monitored and quantified
according to the tax rates that are expected to apply to the period when the asset is realized or
the liability is settled tax revenue, taking into account the resulting tax legislation by measures
currently in force.




Definition
Deferred tax assets and deferred tax liabilities are cleared in the year: the temporary
difference that gave rise to become taxable in respect of deferred tax liabilities or implied
with respect to deferred tax assets, the temporary difference that originated it loses
relevance tax.
Deferred tax assets and deferred tax liabilities are not discounted and even, in principle, offset
each other.
Provisions for risks and charges
Definition
The provision is defined as a liability of uncertain timing or amount.
On the other hand, is defined as contingent liability: a possible obligation that arises from past
events and whose existence will be confirmed only by the occurrence or absence of one or
more future events not wholly within the control of the Bank, a present obligation that arises
from events past, but is not recognized because:
  is not likely to settle the obligation will require the use of financial resources;
  the amount of the obligation can not be determined with sufficient reliability.
Contingent liabilities are not being recognized, but only information, unless they are
considered remote.
Recognition and evaluation
A provision is recognized in the accounts if and only if there is a present obligation (legal or
constructive) as a result of a past event and it is likely that it will be necessary to settle the
obligation, the use of resources embodying economic benefits and can be a reliable estimate
of the amount arising from the fulfillment of the obligation.
The amount recognized as a provision is the best estimate of the expenditure required to settle
the present obligation at the balance sheet date and reflects risks and uncertainties that
inevitably characterize a number of facts and circumstances.The amount of the present value
of expenses that are supposed to be necessary to settle the obligation where the effect of the
present value is material. Future events that may affect the amount required to settle the
obligation are taken into consideration only if there is sufficient objective evidence that the
same will occur.
Provisions for risks and charges include the risk arising from any litigation.
Cancellation Policy
The provision is unlikely to be reversed when it becomes an outflow of resources embodying
economic benefits to settle the obligation
Foreign currency transactions
Definition
Foreign currency is a currency other than the functional currency of the Bank, which in turn
is the currency of the primary economic environment in which the Bank operates.
Criteria for inclusion
A foreign currency transaction is recorded, on initial recognition in the functional currency
using the foreign currency amount the spot exchange rate between the functional currency
and the foreign currency the transaction date.
Evaluation criteria
At each balance sheet date:
a) monetari31 items in foreign currencies are translated using the closing rate;
b) items not monetari32 which are valued at historical cost in foreign currency are translated
using the exchange rate at the date of the transaction;
c) non-monetary items that are measured at fair value in a foreign currency are translated
using the exchange rates at the date when the fair value is determined.
Exchange differences arising from the settlement of monetary items or on translating
monetary items at rates different from those at which they were converted to initial
recognition during the year or in previous financial statements, are recognized in the income
statement in which they originate.
When a gain or loss on a non-monetary item is recognized directly in equity, any exchange
component of that gain or loss is recognized directly in equity. Conversely, when a gain or
loss on a non-monetary item is recognized in the income statement, each exchange component
of that gain or loss is recognized in the income statement.
More information
- Provisions for guarantees and commitments
Provisions on individual and collective basis to estimate the potential payments associated
with the recruitment of credit risk inherent in guarantees and commitments made in
pursuance thereof shall be determined on criteria set by reference to a claim.
These provisions are recorded under item 100 "Other liabilities" in return for the income
statement 130d "Impairment / write-backs for impairment of: other financial transactions."
- Employee Benefits
Definition
Employee benefits are defined as all forms of consideration paid by the company in exchange
for the work performed by employees. Employee benefits are divided between: short-term
benefits (other than benefits payable to employees upon termination of employment and
compensation benefits in the form of equity participation) due wholly within twelve months
after the end of the period in which theemployees have rendered the work;
31 are defined as "monetary" elements represented by specific amounts or currency assets and
liabilities to be received or paid for a set amount of currency. The characteristic of a
monetary item is therefore entitled to receive or an obligation to pay a fixed or determinable
number of units of currency.
32 See, on the contrary, the references to the items "monetary"
Post-employment benefits payable after the conclusion of the employment relationship; benefit plans
after the end of the employment relationship or agreements under which the company provides
benefits after termination of employment, long-term benefits, other from its predecessors due wholly
within twelve months of the term of the year in which the employees have performed work on.
Indemnity
Criteria for inclusion
Following the reform of supplementary social security, under Legislative Decree no. 252/2005, the
share of severance indemnities accruing from January 1, 2007 constitute a "defined contribution
plan."
The burden on the shares is determined on the basis of amounts due without regard to any actuarial
methodology.
Otherwise, the severance indemnities accrued up to December 31, 2006 remained in a "post-
employment benefit" of the series "defined benefit plan" and, as such, requires the determination of
the value of the bond on the basis actuarial assumptions and your liability on a discounted basis as the
debt can be paid off significantly after the employees render the related employee.
The amount recognized as a liability shall be:
a) the present value of defined benefit obligation at the balance sheet date;
b) plus any actuarial gains (less any actuarial losses) recognized in a special reserve in shareholders'
equity;
c) minus any pension charges relating to past service not yet recognized;
d) minus the fair value at the balance sheet of any business carried on plan.
Evaluation criteria
The Bank, in relation to accounting for actuarial gains and losses, has opted for the direct detection in
equity valuation reserves between these components.
The "Actuarial gains / losses" include the effect of adjustments resulting from the reformulation of the
previous actuarial assumptions as a result of actual experiences or due to modifications of the same
assumptions.
For the purposes of discounting method is used the "Projected Unit Credit" which considers each
period of service as giving rise to an additional unit of severance pay measured as each unit separately
to build up the final obligation. This additional unit is obtained by dividing the total expected
performance for number of years since the time of the expected date of liquidation. The application of
this method involves the projection of future payments based on historical statistics and analysis of the
demographic curve and updating of such financial flows using a market interest rate.The rate used for
discounting purposes is determined as the average interest rate swap bid and ask at the reference date
of the assessment appropriately interpolated for intermediate maturities.
- Revenues
Definition
Revenues are gross inflow of economic benefits arising from the ordinary activities of an enterprise
when those inflows result in increases in equity other than increases resulting by the contribution of
the shareholders
Criteria for inclusion
Revenues are measured at fair value of the consideration received or receivable and are recognized in

the accounts when they can be reliably estimated.

The result of a service provision can be estimated reliably when all the following conditions are met: the

amount of revenue can be reliably measured, it is probable that the economic benefits of the transaction

will flow to the company, the stage of completion transaction at the balance sheet date can be reliably

measured, the costs incurred for the transaction and the costs to complete can be reliably calculated.

Revenues recorded against the provision of services are recognized consistent with the phase

completes.

Revenue is recognized when it is probable that the economic benefits of the transaction will flow from the

Bank. However, when the collectability of an amount already included in revenue is characterized by

uncertainty, the uncollectable amount, or the amount for which recovery is no longer probable, is

recognized as an expense rather than as an adjustment of revenue originally recognized.

Revenue arising from the use by others of the company's assets that generate interest or dividends are

recognized when it is probable that the economic benefits associated with the transaction will flow to the

enterprise, the amount of revenue can be reliably evaluated.

Interest is recognized on an accrual basis that considers the actual performance of the property. In

particular: interest income includes the depreciation of any differences, premium or other differences

between the initial carrying amount of a security and its value at maturity. interest payments are

recorded in item 10 "Interest income and similar revenues" for the party deemed recoverable.

Dividends are recorded in accounting at the shareholders' right to receive payment.

Costs or revenues from the sale of securities, determined by the difference between paid or received in

the transaction and the fair value of the instrument are recognized in earnings at entry only because of

the financial instrument fair value is determined as follows: referring to observable current market

transactions and the same instrument, using valuation techniques that use such variables, only data

from observable markets.

- Costs

Costs are recognized for accounting purposes when they are incurred in accordance with the principle of

the correlation between costs and revenues that result directly and jointly from the same transactions or

events. Costs that can not be associated revenues are recognized immediately in income.

Costs directly attributable to financial instruments measured at amortized cost and determinable from

the outset, regardless of when they are cleared, flooding in the income statement by applying the

effective interest rate for the definition of which refer to the 'Claims and Loans ".

Impairment losses are recognized in the income statement when they are discovered.
A.3 - Information on fair value

Section A.3
Information on fair value
A.3.1 Transfers between portfolios
The bank has not made, nor in the current budget nor in the previous reclassifications
portfolio of financial assets from categories measured at fair value to categories measured at
amortized cost with respect to the possibilities introduced by the EC Regulation 1004/2008
of the European Commission.


A.3.2 Hierarchy fair value

The fair value used for the measurement of financial instruments is determined on the basis
of criteria set out below, taking the use of so-called input observable or unobservable.
The inputs are observable parameters developed based on market data available and reflect
the assumptions that market participants would use when price the financial instrument,
otherwise unobservable inputs are parameters for which data are not available to the
market and are therefore developed based on best available information on the assumptions
that market participants would use when price the financial instrument.

Fair value determined on the basis of input level 1:
The assessment is based on observable inputs which is quoted prices in active markets for
identical securities to which the entity can be accessed at the valuation date of the
instrument. The market is defined as active when prices are expressed reflecting normal
market transactions, are regularly and readily available, and whether those prices represent
actual and regularly occurring market transactions.

Fair value determined on the basis of input level 2:
The evaluation is done through methods that are used if the instrument is not quoted in an
active market and relies on inputs other than Level 1. The assessment of the financial
instrument is based on prices can be derived from market prices for similar assets or by
means of assessment for which all the relevant factors - credit spreads and liquidity - are
derived from observable market parameters. Although this is the application of a technical
evaluation, the value resulting
is substantially devoid of discretion as the most important parameters used are drawn from
the market and the estimation methods used replicate quotes on active markets.

Fair value determined on the basis of input level 3
The evaluation is done through methods that involve the exploitation of the instrument is
not listed by use of inferable significant input from the market and therefore does not
involve the adoption of estimates and assumptions by management.

The choice between the above methods for determining the fair value option is not having
the same be applied in a hierarchical order.




104
A.3.2.1 Accounting portfolio: breakdown at fair value
levels


                                                                               31/12/2010                                                  31/12/2009

 Financial assets / liabilities measured at fair value
                                                         Level 1                Level 2              Level 3           Level 1              Level 2             Level 3

1.Financial assets held for trading                           26.554                  74.400                       -         26.577               87.682                       -

2.Financial assets at fair value                                       -                      -                    -                -                     -                    -
3.Financial assets available for sale                              9.916                  2.834                8.163         15.369                   2.817                8.153
4.Hedging derivatives                                                  -              45.471                       -                -             75.128                       -
                                                 Total        36.470                122.705                    8.163        41.946              165.627                    8.153
1.Financial liabilities held for trading                               -              76.037                       -                -             81.138                       -
2.Financial liabilities at fair value                                  -                      -                    -                -                     -                    -
3.Hedging derivatives                                                  -              64.840                       -                -             51.429                       -
                                                 Total                 -            140.877                        -                -           132.567                        -




A.3.2.2 Annual changes in financial assets at fair value (Level 3)
                                                                                                           ASSETS 'FINANCIAL



                                                                    held for                                              available for
                                                                                          measured at fair value                                          coverage
                                                                    trading                                                      sale




1. Initial                                                                           -                             -                    8.153                          -
2. Increases                                                                         -                             -                     104                           -
2.1. Purchases                                                                       -                             -                     104                           -
2.2. Net profit attributed to:                                                       -                             -                        -                          -
2.2.1. Income Statement                                                              -                             -                        -                          -
        - Including capital gains                                                    -                             -                        -                          -
2.2.2. Shareholders' equity                                            X                             X                                      -                          -
2.3. Transfers from other levels                                                     -                             -                        -                          -
2.4. Other increases                                                                 -                             -                        -                          -
3. Decreases                                                                         -                             -                     (94)                          -
3.1.Vendite                                                                          -                             -                        -                          -
3.2. Refunds                                                                         -                             -                        -                          -
3.3. Losses charged to:                                                              -                             -                     (94)                          -
3.3.1. Income Statement                                                              -                             -                        -                          -
        - Of which depreciation                                                      -                             -                        -                          -
3.3.2. Shareholders' equity                                            X                             X                                   (94)                          -
3.4. Transfers to other levels                                                       -                             -                        -                          -
3.5. Other decreases                                                                 -                             -                        -                          -
4. Closing balance                                                                   -                             -                    8.163                          -




A.3.2.3 Annual changes in financial liabilities at fair value (Level 3)
For the Bank there is no such case.

A.3.3 Information on c.d. "Day one profit / loss"

The information referred to in paragraph 28 of IFRS 7 is that any differences between the
transaction price and the value obtained by using valuation techniques that emerge from
the initial recognition of a financial instrument and not detected immediately income
statement in accordance with the provisions of paragraphs AG76 and AG76A of IAS 39.
Where you should submit the case to be referred to the accounting policies adopted by the
Bank to allocate to the income statement, after the first registration of the instrument, the
differences so determined.
Taking also into account the view expressed in paragraph fiscal policies, the Bank has
established operations for which emerge at the time of first registration of a financial
instrument, the difference between the transaction price and the value obtained by the
instrument a technique of internal evaluation.


                                                                                                                                                                     105
Part B - Balance Sheet
ACTIVE

Section 1                Cash and cash equivalents - Item 10 -

1.1 Cash and cash equivalents: breakdown


                                                      Total                     Total
                                                  31/12/2010                31/12/2009

a) Cash                                                        73.922                    92.584

b) Demand deposits with central banks                                   -                         -
Total                                                      73.922                        92.584




106
Section 2 Financial assets held for trading - Item 20 -

2.1 Financial assets held for trading: product breakdown


                                                            Total                                        Total
                 Items / Values                          31/12/2010                                    31/12/2009
                                           Level 1         Level 2         Level 3       Level 1         Level 2         Level 3
A. Balance sheet assets
1. Debt                                       26.553                 167             -      26.576               5.588             -
  1.1 Structured securities                          -                55             -             -                27             -
  1.2 Other debt securities                   26.553                 112             -      26.576               5.561             -
2. Equities                                          -                 2             -             -                 2             -
3. Quote of O.I.C.R                                  -                 -             -             -                 -             -
4. Funding                                           -                 -             -             -                 -             -
  4.1 . Repurchase agreements                        -                 -             -             -                 -             -
  4.2 Other                                          -                 -             -             -                 -             -
Total A                                      26.553                  169             -      26.576               5.590              -
B. Derivatives
1. Financial derivatives:                            1          74.231               -             1          82.092               -
  1.1 Trading                                        1          74.231               -             1          82.092               -
  1.2 . related fair value option                    -                 -             -             -                 -             -
  1.3 other                                          -                 -             -             -                 -             -
2. Credit derivatives:                               -                 -             -             -                 -             -
  2.1 trading                                        -                 -             -             -                 -             -
  2.2 associated with fair value option              -                 -             -             -                 -             -
  2.3 other                                          -                 -             -             -                 -             -
Total B                                              1         74.231                -             1         82.092                 -
                              Total (A +
                              B)             26.554            74.400                -      26.577           87.682                 -




At 31 December 2009 "A.1.2 Level 2" includes 5,471 thousand euro of securities held in the
portfolio owned by the foreign subsidiary (of which Lehman shares for about € 517
thousand).




                                                                                                                                   107
2.2 Financial assets held for trading: breakdown by debtors / issuers



                                                                                       Total                                               Total
                                    Items / Values
                                                                                     31/12/2010                                        31/12/2009


A. BALANCE SHEET ASSETS
1.Debt securities                                                                                       26.720                                        32.164
    a) Governments and Central Banks                                                                     26.719                                       26.601

    b) Other public entities                                                                                         -                                   89

    c) Banks                                                                                                         1                                 4.956

    d) Other issuers                                                                                                 -                                  518

2. Equities                                                                                                         2                                        2

    a) Banks                                                                                                         -                                       -

    b) Other issuers:                                                                                                2                                       2

            - Insurance companies                                                                                    -                                       -

            - Financial companies                                                                                    -                                       -

            - Non-financial                                                                                          2                                       2

            - Other                                                                                                  -                                       -

3. Quote of O.I.C.R.                                                                                                 -                                       -

4. Funding                                                                                                           -                                       -

    a) Governments and central banks                                                                                 -                                       -

    b) Other public entities                                                                                         -                                       -

    c) Banks                                                                                                         -                                       -

    d) Others                                                                                                        -                                       -

Total A                                                                                                 26.722                                        32.166

B. DERIVATIVES

    a) Banks

          - Fair value                                                                                        4.985                                    9.923
    b) Customers

          - Fair value                                                                                   69.247                                       72.170
Total B                                                                                                 74.232                                        82.093

                                                     Total (A + B)                                     100.954                                       114.259




At December 31, 2010 there are no equity securities issued by entities in distress or stranding.




2.3 Financial assets held for trading: annual changes


                                                                       Debt                       Equities         Quote of O.I.C.R.       Funding               Total



Initial                                                                32.164                                 2                        -                 -               32.166
B. Increases                                                          164.223                           228                            -                 -           164.451

B.1 Purchases                                                         163.823                           228                            -                 -               164.051

B.2 Positive changes fair value                                               49                               -                       -                 -                    49

B.3 Other changes                                                          351                                 -                       -                 -                   351

C. Decreases                                                         (169.667)                         (228)                           -                 -          (169.895)

C.1 Sales                                                            (169.642)                         (223)                           -                 -           (169.865)

C.2 Refunds                                                                   (1)                              -                       -                 -                    (1)

C.3 Decreases in fair value                                                   (1)                              -                       -                 -                    (1)

C.4 Transfers to other portfolios                                                -                             -                       -                 -                         -

C.5 Other changes                                                          (23)                              (5)                       -                 -                   (28)

D. Closing balance                                                     26.720                                 2                        -                 -               26.722




108
Section 3 Financial assets at fair value - Item 30 -

For the Bank there is no such case.




                                                       109
Section 4                         Financial assets available for sale - Item 40 -

4.1 Financial assets available for sale: breakdown


                                                                    Total                                                        Total
                                                                 31/12/2010                                                   31/12/2009
                 Items / Values

                                                   Level 1         Level 2               Level 3                Level 1         Level 2            Level 3

1. Debt                                                      -                   -                   -                    -                    -                 -

  1.1 Structured securities                                  -                   -                   -                    -                    -                 -
  1.2 Other debt securities                                  -                   -                   -                    -                    -                 -
2. Equities                                              9.916               2.739             8.163                15.369                2.739              8.153
  2.1 Measured at fair value                             9.916               2.739             1.958                15.369                2.739              1.948
  2.2 Valued at cost                                         -                   -             6.205                      -                    -             6.205
3. Quote of O.I.C.R.                                         -                  95                   -                    -                   78                 -
4. Funding                                                   -                   -                   -                    -                    -                 -
                                     Total              9.916                2.834            8.163                 15.369                2.817          8.153




Section 2.2.1 "Level 1" is the stake in Intesa S. Paul.


4.2 Financial assets available for sale: breakdown by debtors / issuers



                                                                                         Total                          Total
                                  Items / Values                                     31/12/2010                     31/12/2009



1.Debt securities                                                                                           -                             -
   a) Governments and Central Banks                                                                         -                             -

   b) Other public entities                                                                                 -                             -

   c) Banks                                                                                                 -                             -

   d) Other issuers                                                                                         -                             -

2. Equities                                                                                    20.818                           26.261

   a) Banks                                                                                        10.087                        15.540

   b) Other issuers:                                                                               10.731                        10.721

          - Insurance companies                                                                     1.673                         1.693

          - Financial companies                                                                     3.239                         3.239

          - Non-financial                                                                           3.478                         3.449

          - Other                                                                                   2.341                         2.340

3. Quote of O.I.C.R.                                                                                     95                           78

4. Funding                                                                                                  -                             -

   a) Governments and central banks                                                                         -                             -

   b) Other public entities                                                                                 -                             -

   c) Banks                                                                                                 -                             -

   d) Others                                                                                                -                             -

                                                                  Total                        20.913                           26.339




Equity securities include shares acquired upon conversion of partial credit exposure
restored to a value of € 2,341 thousand.




110
4.3 Financial assets available for sale to customers with specific

The assets available for sale are represented by minority stakes in companies for which it
was not considered to provide any type of coverage.




4.4 Financial assets available for sale: annual changes


                                                Debt          Equities       Quote of O.I.C.R.       Funding       Total


Initial                                                 -         26.261                     78                -       26.339
B. Increases                                            -            104                     17                -              121
B.1 Purchases                                           -            104                         -             -              104
B.2 Positive changes in fair value                      -                -                   17                -               17
B.3 Write-backs                                         -                -                       -             -                 -
  - Through profit or loss                              -     X                                  -             -                 -
  - Shareholders' equity                                -                -                       -             -                 -
B.4 Transfers from other portfolios                     -                -                       -             -                 -
B.5 Other changes                                       -                -                       -             -                 -
C. Decreases                                            -         (5.547)                        -             -       (5.547)
C.1 Sales                                               -                -                       -             -                 -
C.2 Refunds                                             -                -                       -             -                 -
C.3 Negative changes in fair value                      -         (5.547)                        -             -           (5.547)
C.4 Write-downs for impairment                          -                -                       -             -                 -
  - Through profit or loss                              -                -                       -             -                 -
  - Shareholders' equity                                -                -                       -             -                 -
C.5 Transfers to other portfolios                       -                -                       -             -                 -
C.6 Other changes                                       -                -                       -             -                 -
D. Closing balance                                      -         20.818                     95                -       20.913




Section 5                            Financial assets held to maturity-Item 50 -
For the Bank there is no such case.




                                                                                                                              111
Section 6                  Due from banks - Item 60 -

6.1 Due to banks: product breakdown



                                                                                      Total                 Total
                              Type of transaction / Value
                                                                                  31/12/2010            31/12/2009


A. Claims on central banks
1. Time deposits                                                                                    -                         -
2. Required reserves                                                                                -                         -

3. Repurchase agreements                                                                            -                         -

4. Other                                                                                            -                         -

B. Loans to banks

1. Current accounts and deposits                                                           63.090               236.105
2. Time deposits                                                                          200.579              6.781.810

3. Other loans                                                                            587.722               424.157

  3.1 Repurchase agreements                                                               508.723               363.323

  3.2 Financial leases                                                                              -                         -

  3.3 Other                                                                                78.999                    60.834

4. Debt                                                                                             -                         -

  4.1 Structured securities                                                                         -                         -

  4.2 Other debt securities                                                                         -                         -

                                                                  Total (value)           851.391             7.442.072
                                                            Total (fair value )          851.398              7.442.072




The most significant difference concerns the "deposits", which, at December 31, 2009,
included:
 approximately 5,574,203 thousand euro for the use of the crop from the foreign branch
    by issuing certificates of deposit and Euro commercial paper subscribed by institutional
 investors;
 about 700,000 thousand euro, of which € 500,000 thousand closely related to Group
    policy aimed at balancing structural fallen due during 2010.

The reserve requirement indirectly paid in amounts to 173,573 thousand euro (163,320
thousand euro at December 31, 2009).

The "repurchase agreements" are concluded exclusively with the parent company is closely
related to similar harvesting operations carried out with customers.

Impaired loans from banks are not significant amount.


6.2 Loans to banks covered by specific

There are no claims covered by specific banks.


6.3 Financial leasing
Have not been put into leases with banks.




112
Section 7                        Receivables from customers - Item 70 -

7.1 Loans to customers: product breakdown


                                                                                               Total                                     Total
                       Type of transaction / Value                                           31/12/2010                                31/12/2009

                                                                                Performing                Impaired           Performing             Impaired

1. Current accounts                                                              2.422.741                     175.074        2.225.093                   117.491
2. Repurchase agreements                                                                       -                      -                       -                     -
3. Mortgages                                                                     8.518.976                     408.635         8.005.766                  279.827
4. Credit cards, personal loans and salary-backed loans                               89.980                     8.300           133.995                       7.335
5. Financial leases                                                                            -                      -                       -                     -
6. Factoring                                                                                   -                      -                       -                     -
7. Other operations                                                              3.292.381                     154.091         3.273.435                  127.343
8. Debt                                                                                  8.026                        -            8.456                            -
  8.1 Structured                                                                               -                      -                       -                     -
  8.2 Other debt securities                                                              8.026                        -            8.456                            -
                                                        Total (value)          14.332.104                      746.100       13.646.745                  531.996
                                                   Total (fair value )         14.789.675                      746.100       14.126.395                  525.349




The "other operations" mainly includes advances on bills and documents sbf, financing
imports and exports subsidies and other non-regulated in c / c customers.

The item "loans" includes:
        € 1,815,700 thousand (of which € 20,049 thousand impaired) to guarantee the
         emissions of covered bonds made by the parent company.
        € 1,236,895 thousand (of which 69,518 thousand euro deteriorated) the related
         securitization transaction.

For more details, please refer to specific sections.




7.2 Loans to customers: breakdown by debtors / issuers


                                                                                    Total                                            Total
                     Type of transaction / Value                                 31/12/2010                                       31/12/2009

                                                                         Performing                 Impaired              Performing                Impaired

1. Debt                                                                          8.026                            -               8.456                             -

a) Governments                                                                           -                        -                       -                         -
b) Other public entities                                                         8.026                            -               8.456                             -
c) Other issuers                                                                         -                        -                       -                         -
   - Non-financial companies                                                             -                        -                       -                         -
   - Financial companies                                                                 -                        -                       -                         -
   - Insurance                                                                           -                        -                       -                         -
   - Other                                                                               -                        -                       -                         -
  2. Loans to:                                                             14.324.078                      746.100           13.638.289                    531.996
a) Governments                                                                     609                           1                4.888                             -
b) Other public entities                                                        29.380                            -              29.483                             -
c) Other                                                                   14.294.089                      746.099           13.603.918                    531.996
   - Non-financial                                                           9.107.722                     599.400            8.749.799                    434.469
   - Financial companies                                                      885.013                       16.485              843.063                         2.577
   - Insurance                                                                   1.294                            -               1.629                             -
   - Other                                                                   4.300.060                     130.214            4.009.427                        94.950
                                                       Total               14.332.104                     746.100           13.646.745                    531.996




                                                                                                                                                                113
7.3 Loans to customers covered by specific activity


                                                                     Total             Total
                                   Type of transaction / Value
                                                                 31/12/2010        31/12/2009

1. Loans with hedging of fair value:
      a) Interest rate risk                                              304.870           442.135
      b) Currency risk                                                         -                 -
      c) Credit risk                                                           -                 -
   d) other risks                                                              -                 -
2. Loans with hedging of cash flows:
      a) Interest rate risk                                                    -                 -
      b) Currency risk                                                         -                 -
      c) more                                                                  -                 -
Total                                                                   304.870           442.135




7.4 Financial leasing
Have not been put into leases with customers.




114
Section 8                       Hedging derivatives - Item 80

8.1 Hedging derivatives: breakdown by type of coverage and levels


                                           PV 31/12/2010                                            PV 31/12/2009
                                                                            VN                                                       VN
                                                                        31/12/2010                                               31/12/2009
                                  L1             L2            L3                          L1             L2            L3

A. Financial derivatives               -          45.471            -      1.890.673            -           75.128           -       2.237.505

 1) Fair value                         -           45.454           -      1.890.575            -           75.128           -       2.237.505
 2) Cash flow                          -               17           -                98         -                   -        -                   -
 3) Foreign Investment                 -                   -        -                  -        -                   -        -                   -
B. Credit derivatives                  -                   -        -                  -        -                   -        -                   -
 1) Fair value                         -                   -        -                  -        -                   -        -                   -
 2) Cash flow                          -                   -        -                  -        -                   -        -                   -
                        Total          -          45.471            -      1.890.673            -           75.128           -       2.237.505




Key:
NV = nominal value
L1 = Level 1
L2 = Level 2
L3 = Level 3




                                                                                                                                              115
8.2 Hedging derivatives: breakdown by hedged portfolio and type of coverage

                                                                           Fair Value                                                                  Cash Flow

                                                               Specification
      Transactions / Type                                                                                                                                                 Investments
           coverage                                                                                                                                                         Foreign
                                                                                                                    General           Specification         General
                                Risk              Risk             Risk                 Risk
                                                                                                    More risk
                                Rate            exchange          Credit                price

1. Financial assets available
                                            -              -                   -                -               -     X                                -       X               X
fo r sale
2. Credits                                  -              -                   -         X                      -     X                                -       X               X
3. Held
                                 X                         -                   -         X                      -     X                                -       X               X
to maturity
4. Portfolio                     X                         X                   X                X               X         1.152                                       -        X

5, Other operations                         -              -                   -                -               -                                      -                                -
Total Assets                                -              -                   -                -               -         1.152                        -              -                 -

1. Financial liabilities               44.302              -                   -         X                      -     X                               17       X               X
2. Portfolio                                                                                                                      -                                   -        X

Total Liabilities                      44.302              -                   -                -               -                 -                   17              -                 -

1. Forecast transactions         X                 X                X                    X             X              X                                -       X               X
2. Portfolio of assets and
                                 X                 X                X                    X             X                          -           X                       -                 -
Financial liabilities




116
Section 9 Fair value of financial assets hedging - Item 90 -
9.1 Fair value of hedged assets: breakdown by hedged portfolio



                                                                    Total                 Total
          Fair value of hedged assets / Values
                                                                31/12/2010            31/12/2009

1. Positive adjustment

1.1 of specific portfolios:                                              40.200                21.556
   a) loans                                                              40.200                21.556

   b) financial assets available for sale                                         -                     -

1.2 overall                                                                       -                     -

2. Negative adjustment

2.1 of specific portfolios                                                        -                     -
   a) loans                                                                       -                     -

   b) financial assets available for sale                                         -                     -

2.2 overall                                                                       -                     -
                                                        Total            40.200                21.556




9.2 Activities of the hedged interest rate risk



                                   Activities covered           31/12/2010            31/12/2009


1. Credits                                                              927.723               744.442
2. Financial assets available for sale                                            -                     -
3. Portfolio                                                                      -                     -
Total                                                                   927.723               744.442




                                                                                                            117
Section 10 Equity investments - Item 100 -

10.1 Equity investments in subsidiaries, jointly controlled or under significant
influence: information on shareholders' equity

                                                                                                                  Share
                                   Labels                                                See
                                                                                                             Participation%


A. Subsidiaries exclusively (*)



VALLEY BANK OF CAMONICA SpA
Capital Euro 2,738,693
in shares of Euro 1 each.                                                          Breno (BS)                     8,716



UBI Banca International SA
Capital Euro 59,070,750
in shares of Euro 510 each.                                                        Luxembourg                     5,850



UBI SYSTEMS AND SERVICES SCpA
Capital Euro 35,136,400
in shares of Euro 0.52 each.                                                            Brescia                   2,960



B. Companies under joint control



C. companies subject to significant influence




(*) They are including investments in group companies even if the minority.




10.2 Equity investments in subsidiaries, jointly controlled or under significant
influence: accounting information


                                                    Total         Total Revenues                                              Balance sheet value
                                                                                        Net income
                    Labels                                                              (loss)               Net equity
                                                    assets              (*)
                                                                                                             (**)


A. Subsidiaries exclusively
Bank of Vallecamonica SpA                             2.122.894               60.463                 1.574        112.550           12.266
UBI Banca International SA (***)                      8.935.468               33.214                 8.908        110.414            5.191
UBI Sistemi e Servizi SCpA                              205.614                  (93)                   -          51.664            1.565
B. companies under joint control
                                                0            -                     -                    -                 -              -
C. Companies subject to significant influence
                                                0            -                     -                    -                 -              -

Total                                               11.263.976                93.584              10.482         274.628           19.022



(*) The amounts represent the gross income.
(**) Shareholders' equity includes the profit arising from the draft budget for 2010.
(***) Data from UBI Banca International SA emerge from financial statements prepared for
consolidation, according to the principles applied by the parent company.




118
10.3 Equity investments: annual changes


                                                   Total                    Total
                                               31/12/2010               31/12/2009

A. Initial                                                 16.122                16.122

B. Increases                                           146.420                            -

B.1 Purchases                                                       -                     -

B.2 Write-backs                                                     -                     -

B.3 Revaluations                                                    -                     -

B.4 Other changes                                      146.420                            -

C. Decreases                                           143.520                            -

C.1 Sales                                                           -                     -

C.2 Value adjustments                                               -                     -

C.3 Other changes                                      143.520                            -

D. Closing balance                                         19.022                16.122

E. Total revaluations                                               -
F. Total adjustments                                                -                     -




Following the optimization of land, were included in this item holdings relating to Banca
Popolare di Bergamo, Banca Popolare Commercio and Industry, European Regional Bank,
and Banco di San Giorgio, amounting to 32,896 thousand euro; In compliance with the OPI
Assirevi, handling has been included among the other increases. In July, the same shares
were sold to the parent company for a consideration of approximately € 143,520 thousand,
all writing by the other decreases. The difference between book value and disposal value,
amounting to € 110,624 thousand, was included among the other increases in return on
equity.

Other increases include an increase (of € 2,899.9 thousand) of participation in UBI
International SA following the contribution of the Luxembourg branch.




10.4 Commitments relating to investments in subsidiaries
There are no investments classified as subsidiaries.



10.5 Commitments relating to investments in subsidiaries, jointly
There are classified as jointly controlled subsidiaries.



10.6 Commitments relating to investments in companies under significant influence

There are no commitments or contingent liabilities related to companies under significant
influence.




                                                                                              119
Section 11 Tangible assets - Item 110 -

Tangible assets of the bank are valued at cost less depreciation as detailed in Part A of these
notes.


11.1 Tangible assets: breakdown of assets carried at cost




                                                                    Total                    Total
                              Assets / Values
                                                                31/12/2010               31/12/2009

A. Operating assets
   1.1 owned                                                            241.758                  176.774
  a) land                                                               145.336                   88.331
  b) buildings                                                           74.440                   62.319
  c) furniture                                                               7.712                    8.298
  d) electronic equipment                                                    4.935                    6.059
  e) other                                                                   9.335                11.767
   1.2 Leased                                                                        -                1.447
  a) land                                                                         -                     652
  b) buildings                                                                    -                     795
  c) furniture                                                                    -                           -
  d) electronic equipment                                                         -                           -
  e) other                                                                        -                           -
Total A                                                                 241.758                  178.221
B. Assets held for investment purposes
   2.1 owned                                                             52.078                  119.165
  a) land                                                                41.479                   92.460
  b) buildings                                                           10.599                   26.705
   2.2 Leased                                                                        -                        -
  a) land                                                                         -                           -
  b) buildings                                                                    -                           -
Total B                                                                  52.078                  119.165
Total (A + B)                                                           293.836                  297.386




11.2 Tangible assets: breakdown of assets measured at fair value or revalued
Tangible assets are valued at cost, so there is not the case.




120
11.3 Property and equipment used in operations: annual changes


                                                                                                                       Electronic equipment
                                                       Land             Buildings            Furniture                                        Other                 Total

A. Gross opening balance                                122.907              105.516                     34.009                27.091                 68.274          357.797

A.1 Total net reductions                                 (33.924)             (42.402)               (25.711)                 (21.032)            (56.507)           (179.576)
A.2 Net                                                   88.983               63.114                     8.298                 6.059                 11.767          178.221
B. Increases                                              59.009               16.091                     1.078                   825                  1.618            78.621
B.1 Purchases                                                     1                     5                   977                    650                 1.422                3.055
B.2 Capitalised expenditure on improvements                         -                672                           -                     -                      -            672
B.3 Write-backs                                                     -                    -                         -                     -                      -                   -
B.4 Positive changes in fair value:                                 -                    -                         -                     -                      -                   -
  a) equity                                                         -                    -                         -                     -                      -                   -
  b) income statement                                               -                    -                         -                     -                      -                   -
B.5 Exchange gains                                                  -                    -                         -                     -                      -                   -
B.6 Transfers from property held for investment                     -                    -                         -                     -                      -                   -
B.7 Other changes                                         59.008               15.414                       101                    175                   196            74.894
C. Decreases                                              (2.656)              (4.765)                   (1.664)               (1.949)                (4.050)         (15.084)
C.1 Sales                                                     (40)                  (213)                          -                     -                 (1)              (254)
C.2 Depreciation                                                    -          (2.380)                   (1.507)               (1.775)                (3.442)           (9.104)
C.3 Adjustments for impairment charged to:                          -                    -                   (12)                        -                      -             (12)
  a) equity                                                         -                    -                         -                     -                      -                   -
  b) income statement                                               -                    -                   (12)                        -                      -             (12)
C.4 Negative changes in fair value:                                 -                    -                         -                     -                      -                   -
  a) equity                                                         -                    -                         -                     -                      -                   -
  b) income statement                                               -                    -                         -                     -                      -                   -
C.5 Negative exchange rate differences                              -                    -                         -                     -                      -                   -
C.6 Transfers to:                                                   -                    -                         -                     -                      -                   -
     a) tangible assets held for investment purposes                -                    -                         -                     -                      -                   -
  b) assets held for sale                                           -                    -                         -                     -                      -                   -
C.7 Other changes                                         (2.616)              (2.172)                     (145)                 (174)                  (607)           (5.714)
D. Closing net                                          145.336                74.440                     7.712                 4.935                  9.335          241.758
D.1 Total net reductions                                 (49.306)             (53.746)               (26.532)                 (22.404)            (58.067)           (210.055)
D.2 final gross                                         194.642              128.186                     34.244                27.339                 67.402          451.813
E. Carried at cost                                                  -                    -                         -                     -                      -                   -




                                                                                                                                                                                        121
Depreciation is calculated on the basis of estimated useful life of the asset from the date of
entry into operation.
The estimated useful life in months for the major asset classes are shown below



                                  Description         Depreciation                              Useful life

        Land for buildings                                NO                                   Unamortized
                                                                                             On the basis of
        Real Estate - Properties for lease                YES                                    expertise
        Lifting equipment, and weighing                   YES                                  160 months
        Light construction and shelving                   YES                                  120 months
        Furniture and other furnishings                   YES                                  120 months
        Furniture and office machinery                    YES                                  100 months
        ATM Equipment                                     YES                                   96 months
        Safes and prefab armor                            YES                                   80 months
        Machinery, appliances and other equipment         YES                                   80 months
        Various machinery, furniture and fixtures         YES                                   80 months
        Counters with armored or armored glass            YES                                   60 months
        Personal Computer                                 YES                                   60 months
        Equipment for cafeteria                           YES                                   48 months
        Special internal systems of communication         YES                                   48 months
        Alarm system                                      YES                                   40 months
        Firefighting equipment                            YES                                   40 months
        Electric and electronic office machines           YES                                   30 months
        Motor Transport                                   YES                                   30 months
        Cars                                              YES                                   24 months
        Leased Cars                                       YES                      On the basis of the contract period




11.4        Tangible assets held for investment: annual changes

                                                                             Total
                                                                           31/12/2010

                                                                Land                          Buildings

A. Initial                                                             92.460                             41.103

A.1 Total net reduction                                                           -                   (14.398)
A.3 Initial net                                                        92.460                             26.705
B. Increases                                                           24.525                              4.111
B.1 Purchases                                                                     -                                 -
B.2 Capitalised expenditure on improvements                                       -                                 -
B.3 Positive changes fair value                                                   -                                 -
B.4 Write-backs                                                                   -                                 -
B.5 Positive exchange differences                                                 -                                 -
B.6 Transfer from property used in operations                                     -                                 -
B.7 Other changes                                                       24.525                             4.111
C. Decreases                                                         (75.506)                         (20.217)
C.1 Sales                                                                 (886)                           (1.455)
C.2 Depreciation                                                             (2)                            (988)
C.3 Decreases in fair value                                                       -                                 -
C.4 Adjustments for impairment                                                    -                                 -
C.5 Negative exchange differences                                                 -                                 -
C.6 Transfers to other portfolios of activities:                                  -                                 -
       a) property used in operations                                             -                                 -
       b) non-current assets held for sale                                        -                                 -
C.7 Other changes                                                      (74.618)                       (17.774)
D. Closing balance                                                     41.479                             10.599
D.1 Total net reduction                                                 (8.380)                           (5.557)
D.2 final gross                                                        49.859                             16.156
E. Valuation at fair value                                              62.423                            15.951




122
11.5 Commitments for the purchase of tangible assets (IAS 16/74.c)



                           Assets / Values             31/12/2010          31/12/2009


A. Operating assets

1.1 Owned:                                                          736                 222
  - Land                                                              -                   -
  - Buildings                                                         -                   -
  - Furniture                                                       134                 222
  - Electronic equipment                                            318                   -
  - Other                                                           284                   -
1.2 In financial leases:                                              -                   -
  - Land                                                              -                   -
  - Buildings                                                         -                   -
  - Furniture                                                         -                   -
  - Electronic equipment                                              -                   -
  - Other                                                             -                   -
Total A                                                             736                 222
B. Assets held for investment purposes
2.1 Owned:                                                            -                   -
  - Land                                                              -                   -
  - Buildings                                                         -                   -
2.2 In financial leases:                                              -                   -
  - Land                                                              -                   -
  - Buildings                                                         -                   -
Total B                                                               -                   -
Total A + B                                                         736                 222




The above commitments are within normal planning activities of the company, it is not yet
done that orders will be delivered in early 2011.




                                                                                              123
Section 12 Intangible assets - Item 120 -
12.1 Intangible assets: breakdown by type of activity


                                                               Total                                     Total
                        Assets / Values                     31/12/2010                               31/12/2009

                                               Specified time            Indefinite       Specified time           Indefinite

A.1 Goodwill                                         X                       19.705             X                        19.705
A.2 Other intangible assets                                     -                     -                34                       -
A.2.1 Assets valued at cost:                                    -                     -                    34                   -
  a) Internally generated intangible assets                     -                     -                     -                   -
  b) Other activities                                           -                     -                    34                   -
A.2.2 Assets valued at fair value                               -                     -                     -                   -
  a) Internally generated intangible assets                     -                     -                     -                   -
  b) Other activities                                           -                     -                     -                   -
Total                                                           -            19.705                    34                19.705




At 31 December 2009, other intangible assets with limited lifespan are the software of the
foreign branch that is amortized over 60 months.

Goodwill represents the amount paid by Banco di Brescia in front of the drive capacity for
aggregation, to generate future economic benefits to society "aggregator". The following are
reported in detail:


    Gruppo Banca Lombarda Milan - 1995                                                                          5.567

    Bank of Cimino - branch split - 1995                                                                        1.250

    Bank of Cimino - year 1998                                                                                  9.627

    Bank branches of Vallecamonica - Year 2001                                                                  1.164

    European Regional Bank Branches - Year 2002                                                                 2.097

    Total goodwill                                                                                              19.705



As stated by IAS 36, a company must assess at each balance sheet date whether there is
any indication that an asset may be impaired in value (impairment test). For goodwill,
regardless of whether there are any indications of impairment is necessary to perform the
above verification at least annually. Within the meaning of IAS 36, has suffered an
impairment loss when its carrying amount exceeds its recoverable amount ie the higher of
its fair value less costs to sell and its value in use.
The goodwill has been allocated the entire legal entity which the total cash-generating units.
Therefore the verification of impairment of goodwill in the balance sheet at 31 December
2009 was performed comparing the use value of the complex business
(Which is a single cash generating unit) with its book value.
The estimated value in use was carried out according to the actualization of income flows,
as calculated in the budget 2011 and extrapolated on the basis of growth rates 2012-2015
of the main key components, described below, approved by the Board of Directors Bank:


                        Loans to customers                      CAGR%      2010-2015
                        RWA Jobs                                CAGR%      2010-2015
                        Direct deposits                         CAGR%      2010-2015
                        Asset management                        CAGR%      2010-2015
                        Assets under custody                    CAGR%      2010-2015
                        Total funding                           CAGR%      2010-2015

124
                Operating Income                        CAGR% 2010-2015
                - Of which net commissions              CAGR% 2010-2015
                Operating costs                         CAGR% 2010-2015
                Cost income                             year 2015
                Cost of credit                          year 2015
                Mark up time                            2015
                Mark down the average                   2015
                Spread indirect                         2015


The growth rate of earnings used is equal to 0.82% and is considered stable and does not
exceed the long-term growth rates of the entire banking sector.
The discount rate after tax net profits amounted to 8.82%. This rate together with the
growth rate over the period of the forecast of 0.82% helps to define a capitalization rate to
estimate the terminal value equal to 8.0%. The capitalization rate is aligned to that used by
equity analysts who follow the UBI.

The methodology described above and the quantitative information in support were adopted
in an autonomous and formal adoption by the Board of Directors of the Bank.
The analysis made it possible to detect the absence of impairment losses (impairment
losses) of goodwill in the balance sheet of the Bank at December 31, 2010.




                                                                                                125
12.2 Intangible assets: annual changes


                                                             Other intangible assets: generate
                                                                                                        Other intangible assets: Other
                                                                        internally
                                              Goodwill                                                                                            31/12/2010
                                                             Specified time         Indefinite       Specified time              Indefinite


A. Initial                                         19.705                       -                -                    34                      -          19.739
A.1 Total net reduction                                  -                      -                -                     -                      -                   -
A.2 Net                                            19.705                       -                -                    34                      -          19.739
B. Increases                                             -                      -                -                     -                      -                   -
B.1 Purchases                                            -                      -                -                     -                      -                   -
B.2 Increases in internal intangible assets    X                                -                -                     -                      -                   -
B.3 Write-backs                                X                                -                -                     -                      -                   -
B.4 Positive changes fair value                                                 -                -                     -                      -                   -
  - Shareholders' equity                       X                                -                -                     -                      -                   -
  - The income statement                       X                                -                -                     -                      -                   -
B.5 Positive exchange differences                        -                      -                -                     -                      -                   -
B.6 Other changes                                        -                      -                -                     -                      -                   -
C. Decreases                                             -                      -                -                (34)                        -                (34)
C.1 Sales                                                -                      -                -                     -                      -                   -
C.2 Value adjustments                                    -                      -                -                (34)                        -                (34)
  - Depreciation                               X                                -                -                (10)                        -                (10)
  - Impairment losses                                    -                      -                -                (24)                        -                (24)
      + Equity                                 X                                -                -                     -                      -                   -
      + Income                                           -                      -                -                (24)                        -                (24)
C.3 Decreases in fair value                                                     -                -                     -                      -                   -
  - Shareholders' equity                       X                                -                -                     -                      -                   -
  - The income statement                       X                                -                -                     -                      -                   -
C.4 Transfers to non current assets
                                                         -                      -                -                     -                      -                   -
discontinued operations
C.5 Negative exchange differences                        -                      -                -                     -                      -                   -

C.6 Other changes                                        -                      -                -                     -                      -                   -
D. Closing net                                     19.705                       -                -                     -                      -          19.705
D.1 Total net                                            -                      -                -                     -                      -                   -
E. Closing gross                                   19.705                       -                -                     -                      -          19.705
F. Carried at cost                                       -                      -                -                     -                      -                   -




126
12.3 Other information

We provide the following information:
   a) there is no impediment to the distribution to shareholders of capital gains on
        revalued intangible assets;
   b) There are no intangible assets acquired by government grant;
   c) There are no intangible assets pledged as collateral for its debts;
   d) There are no commitments for the purchase of intangible assets;
   e) There are no intangible assets subject to leases.




                                                                                       127
Section 13 Tax assets and tax liabilities - Item 130 of and Item 80 of
the past -
13.1 Deferred tax assets: breakdown


                                                                                           Total                                    Total
                                                                                       31/12/2010                               31/12/2009


                                                                                                     Tax effect                              Tax effect
                                                                                Amount                                   Amount
                                                                                                     (IRES rate                              (IRES rate
                                                                              temporary                                temporary
                                                                                                    27.5%, 4.82%                            27.5%, 4.82%
                                                                              differences                              differences
                                                                                                        IRAP)                                   IRAP)


Deferred tax assets with income statement contra entry                               120.677               33.494               92.800              25.830

- Loans                                                                                90.705               24.944              62.067              17.069
- Financial instruments                                                                         -                  -                    -                   -
- Tangible assets                                                                               -                  -                    -                   -
- Provisions for risks and charges                                                     18.080                4.972              19.478               5.356
- Personnel costs                                                                       5.316                1.462               4.313               1.186
- Impairment of deferred charges                                                                -                  -                    -                   -
- Goodwill                                                                              1.813                  587               1.830                 591
- Impairment of investments and securities available for sale                           4.650                1.497               5.030               1.601
- Other minor                                                                               114                 33                    82                   27
Deferred tax assets with shareholders' equity contra entry                                  552               102                    138                    9
- Personnel costs                                                                           231                 14                      -                   -
- Other minor                                                                               321                 88                   138                    9
Total deferred tax assets recognized                                                 121.229               33.597               92.938              25.839
- Timing differences excluded from the determination of deferred tax assets                     -                  -                    -                   -
Total deferred tax assets inscribed                                                  121.229               33.597               92.938              25.839




13.2 Deferred tax liabilities: breakdown


                                                                                           Total                                    Total
                                                                                       31/12/2010                               31/12/2009


                                                                                                     Tax effect                              Tax effect
                                                                               Amount                                    Amount
                                                                                                     (IRES rate                              (IRES rate
                                                                                                                       temporary
                                                                                                    27.5%, 4.82%                            27.5%, 4.82%
                                                                              temporary                                differences
                                                                                                        IRAP)                                   IRAP)
                                                                              differences

Deferred taxes with income statement contra entry                                     57.113               16.563              91.430               25.961

- Property and equipment leased                                                         1.801                  594               1.837                 604
- Financial instruments                                                                       -                    -                   -                    -
- Tangible assets                                                                       2.502                  887               5.302               1.724
- Goodwill                                                                             11.506                3.719               9.166               2.962
- Provisions for loan losses                                                                  -                    -                   -                    -
- Gains in installments                                                                36.656               10.084              73.405              20.197
- Personnel costs                                                                       4.648                1.278               1.720                 473
- Other minor                                                                                 -                    -                   -                    -
Deferred tax on shareholders' equity contra entry                                      5.252                  449              11.533                1.013
- Valuation of securities available for sale                                            5.252                  449              10.690                 781
- Staff costs                                                                                 -                    -                 843               232
Total deferred members                                                                62.365               17.011             102.963               26.974
- Timing differences excluded from the determination of deferred tax                          -                    -                   -                    -
Total deferred tax inscribed                                                          62.365               17.011             102.963               26.974




128
13.3 Changes in deferred tax assets (income statement)


                                                                   Total                    Total
                                                               31/12/2010               31/12/2009

1. Initial amount                                                       25.830                   20.967

2. Increases                                                            11.197                       9.428

2.1 Deferred tax assets recognized in the                               10.885                       7.309

      a) relating to prior years                                                  -                          -

      b) due to changes in accounting policies                                    -                          -

      c) write-backs                                                              -                          -

      d) other                                                          10.885                       7.309

  2.2 New taxes or increases in tax rates                                         -                          -

  2.3 Other increases                                                         312                    2.119

  2.4 Business combinations                                                       -                          -

3. Decreases                                                            (3.533)                  (4.565)

  3.1 Deferred tax assets derecognised during the year                  (2.534)                  (2.980)

      a) turnarounds                                                    (2.534)                  (2.980)

      b) write-offs                                                               -                          -

      c) change in accounting policies                                            -                          -

      d) other                                                                    -                          -

  3.2 Reductions in tax rates                                                     -                          -

  3.3 Other decreases                                                       (999)                (1.585)
4. Subtotal                                                             33.494                   25.830




The data reported in items 2.3 - Other increases and 3.3 - Other decreases for the year
under review, corresponding to deferred tax assets related to the items being transferred
between the companies involved in the operation of local optimization.


13.4 Changes in deferred taxes (income statement)


                                                                   Total                    Total
                                                               31/12/2010               31/12/2009

1. Initial amount                                                       25.961                   39.364

2. Increases                                                                1.967                    3.127

2.1 Deferred taxes recognized in the                                          961                    3.127

  a) relating to prior years                                                        -                        -

  b) due to changes in accounting policies                                          -                        -

  c) other                                                                    961                    3.127

2.2 New taxes or increases in tax rates                                             -                        -

2.3 Other increases                                                         1.006                            -

3. Decreases                                                           (11.366)                 (16.530)

3.1 Deferred tax liabilities eliminated during                         (10.664)                 (10.918)

  a) turnarounds                                                       (10.664)                 (10.918)

  b) due to changes in accounting policies                                          -                        -

  c) other                                                                          -                        -

3.2 Reductions in tax rates                                                         -                        -

3.3 Other decreases                                                          (702)               (5.612)
4. Subtotal                                                             16.562                   25.961




The data reported in items 2.3 - Other increases and 3.3 - Other decreases for the year
under review, include the deferred tax relating to items to be sold among the companies
participating in the operation of local optimization.



                                                                                                                 129
13.5 Changes in deferred tax assets (shareholders' equity)


                                                               Total                             Total
                                                             31/12/2010                      31/12/2009

1. Initial amount                                                               9                                -

2. Increases                                                                  94                                9
2. 1 Deferred tax assets recognized in the                                     94                               9
  a) relating to prior years                                                        -                            -
  b) due to changes in accounting policies                                          -                            -
  c) other                                                                     94                               9
2.2 New taxes or increases in tax rates                                             -                            -
2. 3 Other increases                                                                -                            -
3. Decreases                                                                        -                            -
3. 1 Deferred tax assets derecognised during the year                               -                            -
  a) turnarounds                                                                    -                            -
  b) write-offs                                                                     -                            -
  c) due to changes in accounting policies                                          -                            -
  d) other                                                                          -                            -
3.2 Reductions in tax rates                                                         -                            -
3. 3 Other decreases                                                                -                            -
4. Subtotal                                                                  103                                9




13.6 Changes in deferred taxes (in return of equity)


                                                           Total                            Total
                                                        31/12/2010                      31/12/2009

1. Initial amount                                                    1.013                           1.230

2. Increases                                                             6                            200
2.1 Deferred taxes recognized in the                                     6                             200
   a) relating to prior years                                            -                               -
   b) due to changes in accounting policies                              -                               -
   c) other                                                              6                             200
2.2 New taxes or increases in tax rates                                  -                               -
2.3 Other increases                                                      -                               -
3. Decreases                                                         (570)                           (417)
3.1 Deferred tax liabilities eliminated during                       (570)                           (417)
   a) turnarounds                                                    (570)                           (417)
   b) due to changes in accounting policies                              -                               -
   c) other                                                              -                               -
3.2 Reduction in tax rates                                               -                               -
3.3 Other decreases                                                      -                               -
4. Subtotal                                                           449                            1.013




13.7 Other information


                                                                 Total                            Total
                                                               31/12/2010                     31/12/2009


Advances paid to the tax authorities                                         15.946                          26.043
Tax Credit                                                                   16.294                          24.246
                                                                             32.240                          50.289




130
Section 14 Non-current assets held for discontinued operations and
            liabilities - Item 90 and Item 140 of liability -
For the Bank there is no such case.




                                                                     131
Section 15 Other assets - Item 150 -

15.1 Other assets: breakdown


                                                                         Total                Total
                                                                     31/12/2010           31/12/2009

Schedule and related transactions in Covered Bond / Securitization           863.571              108.438

Leasehold improvements                                                            4.288                 4.522

Float                                                                         10.495                   71.087

Skills to be collected                                                        23.999                   22.838

Valuation currency on foreign exchange transactions and portfolio                 3.957                 1.679

Cheques drawn on third                                                               34                   684

Lots of work in progress                                                      10.279                   12.156

Tax receivables                                                               18.746                   17.932

Other assets - tax consolidation                                              66.933                   55.235

Other matches                                                                 10.049                   25.798
TOTAL                                                                     1.012.350               320.367




The games on operations in covered bonds securitized and are the difference between the
subordinated loan granted to the company issuing vehicle and the debt to the same one that
represents the residual value of the collateral and securitized loans sold.

Deferred tax consolidation are the direct payments and tax credits transferred to the Parent
Company in accordance with the regulations of the national fiscal consolidation.

The other matches comprise accruals not brought back for a total of 3,799 thousand euro.




132
LIABILITIES

Section 1                 Due to banks - Item 10 -
1.1 Due to banks: breakdown



                                                                            Total                 Total
                             Type of transaction / Value
                                                                        31/12/2010            31/12/2009


1. Due to central banks                                                                   -                        -
2. Du e to banks                                                              3.341.564             1.370.705
   2.1 Current accounts and deposits                                          1.859.062               174.669
   2.2 Time deposits                                                            153.685                95.713
   2.3 Funding                                                                1.318.314             1.095.154
     2.3.1 Repurchase                                                         1.234.633             1.026.669
     2.3.2 Other                                                                 83.681                68.485
   2.4 Commitments to repurchase own equity instruments                                   -                      -
   2.5 Other payables                                                            10.503                    5.169

                                                               Total          3.341.564             1.370.705
                                                           Fair Value         3.341.564             1.370.705




The increase is mainly attributable to the Parent indebtedness (see "current accounts and
deposits") due to early repayment of bonds
(A total of 1,100,000 thousand euro) relating to the Group policy aimed at structural
balance;

"Other debts" is operating payables.

Transactions in repurchase agreements are concluded exclusively with the parent company
is closely related to the securitization.




1.2 Details of item 10 "Due to banks: subordinated debt
There are no subordinated debt from banks.



1.3 Details of item 10 "Due to banks": structured debts
There are no structured debts to banks.



1.4 Due to banks: debts covered by specific
There are no debts covered by specific banks.



1.5 Finance lease payables
There are no debts to banks to finance leases.




                                                                                                           133
                              Deposits from customers - Item
Section 2                                                20 -

2.1 Due to customers: product breakdown


                                                                                   Total                   Total
                                   Type of transaction / Value
                                                                               31/12/2010              31/12/2009

1. Current accounts and deposits                                                     8.244.905               8.246.055

2. Time deposits                                                                           28.159              195.208
3. Funding                                                                             505.573                 362.731
  3.1 Repurchase agreements                                                            505.161                 362.133
  3.2 Other                                                                                  412                    598
4. Commitments to repurchase own equity instruments                                                -                     -
5. Other payables                                                                      107.081                  66.855
                                                                      Total          8.885.718               8.870.849
                                                                 Fair Value          8.885.718               8.870.849




"Other debts" is mainly the cashier.




2.2 Details of item 20 "Due to customers': subordinated debt
There are no subordinated debt to customers.



2.3 Details of item 20 "Due to customers": structured debts
There are no structured debts from customers.



2.4 Due to customers: debts covered by specific
There are no debts covered by specific to customers.




2.5 Finance lease payables

Amounts due to customers under finance leases amounted to 411 thousand euro.
The amount in question is represented by a real estate contract with UBI Leasing Spa,
funded with a total value amounted to 1,417 thousand euro.
The expiry of the contract that is expected in June 2013. The
future payments are detailed below:


                                                                                  Total                    Total
                                                                              31/12/2010               31/12/2009

Outstanding debt to leasing companies

  - Within one year                                                                          206                    193

  - Between 1 and 5 years                                                                    206                    405

  - Over 5 years                                                                                -                            -




134
Section 3                         Debt securities in issue - Page 30 -
3.1 Debt securities in issue: product breakdown


                                                                Total                                                                         Total
                                                            31/12/2010                                                                    31/12/2009

      Type of securities /
      Values                                                                Fair Value                                                             Fair Value
                                    Value                                                                        Value
                                    Budget                                                                       Budget
                                                      Level 1                Level 2            Level 3                             Level 1         Level 2              Level 3

A. Titles

    1. bonds                          3.209.945                     -           3.197.049                    -      5.070.761                  -         5.068.265                       -
        1.1 structured                1.384.755                     -           1.373.918                    -      2.385.012                  -         2.386.306                       -
        1.2 Other                     1.825.190                     -           1.823.131                    -      2.685.749                  -         2.681.959                       -
    2. Other securities                     23.311                  -                  23.310                -      5.229.549                  -         5.229.549                       -
        2.1 Specimen layout                       -                 -                       -                -                  -              -                     -                   -
        2.2 Other                           23.311                  -                  23.310                -      5.229.549                  -         5.229.549                       -
                          Total      3.233.256                      -          3.220.359                     -    10.300.310                   -       10.297.814                        -




The item "structured notes" includes 280,000 thousand euro (1,380,000 thousand euro at
December 31, 2009) relating to issues of bonds, entirely underwritten by the parent
company and aimed at structural balance.

At December 31, 2009, securities issued included:
- under "Other-Other titles, certificates of deposit and Euro commercial paper, for about €
5,200,458 thousand issued by the foreign subsidiary;
- the "structured bonds," a subordinated deposit formed at the same branch of the Preferred
Capital Company LLC (Delaware - USA) to 165,102 thousand euro.

Structured securities are mainly relates to bonds step up, step up callable, constant maturity
swaps, inflation-linked.




3.2 Breakdown of item 30 "Outstanding": subordinated securities

Subordinated liabilities meet the requirements set by the Bank of Italy for their inclusion in
the calculation of regulatory capital, in particular:
 early repayment clause, with the approval of the supervisory board;
   subordination clause operating in the event of liquidation of the Parent UBI Banca.

The details of the loans in the following table (in thousands of euro).

                                                                                                                                                                Balance at
               Title                                                                                      Rate
                                                                                                                                                                31/12/2010
                                                                Euribor 3 months + 1.05% for the first 5 years + 1.65 for
2) Bonds 2002-2012 (**)                                         after (*)                                                                                                100.067


(*) Unless exercise the call option that allows early repayment. (**) The
loan was signed by the parent company UBI Banca.




                                                                                                                                                                                   135
3.3 Securities issued to customers with specific


                                                                          Total               Total
                                                                       31/12/2010          31/12/2009


1. Securities covered by specific fair value:                                2.069.688           2.379.410
      a) Interest rate risk                                                  2.069.688           2.379.410
      b) Currency risk                                                                -                  -
      c) other risks                                                                  -                  -
2. Securities covered by specific cash flow hedges:                                 790                  -
      a) Interest rate risk                                                           -                  -
      b) Currency risk                                                              790                  -
      c) more                                                                         -                  -




The following table shows the carrying value of bonds covered by the risk of interest rate
(shown in line 1a) and certificates of deposit in yen covered cash flow hedging (Given in row
2.b).
The fair value of hedging is entered, depending on the sign in the appropriate entries
del'attivo or liabilities in the balance sheet.




136
Section 4                           Financial liabilities held for trading - Item 40 -
4.1 Financial liabilities held for trading: product breakdown

                                                                   Total                                                  Total
                                                                31/12/2010                                             31/12/2009
     Type of transaction / Value
                                                                    FV                                                     FV
                                              VN                                          FV *       VN                                          FV *
                                                       L1           L2           L3                           L1           L2           L3
A. Balance-sheet liabilities
 1. Due to banks                                   -        -                -        -          -        -        -                -        -           -
 2. Due to customers                               -        -                -        -          -        -        -                -        -           -
 3. Debt                                           -        -                -        -          -        -        -                -        -           -
    3.1 Bonds                                      -        -                -        -          -        -        -                -        -           -
      3.1.1 Structured                             -        -                -        -    X              -        -                -        -    X
      3.1.2 Other                                  -        -                -        -    X              -        -                -        -    X
    3.2 Other securities                           -        -                -        -          -        -        -                -        -           -
      3.2.1 Structured                             -        -                -        -    X              -        -                -        -    X
      3.2.2 Other                                  -        -                -        -    X              -        -                -        -    X
                                    Total A        -        -                -        -          -        -        -                -        -           -
B. Derivatives
 1. Financial derivatives                      X            -        76.037           -              X             -        81.138           -
    1.1 Trading                                X            -        76.037           -    X         X             -        81.138           -    X
    1.2 Related fair value option              X            -                -        -    X         X             -                -        -    X
    1.3 Other                                  X            -                -        -    X         X             -                -        -    X
 2. Credit derivatives                         X            -                -        -              X             -                -        -
    2.1 Trading                                X            -                -        -    X         X             -                -        -    X
    2.2 Related fair value option              X            -                -        -    X         X             -                -        -    X
    2.3 Other                                  X            -                -        -    X         X             -                -        -    X
                                 Total B       X            -       76.037            -    X         X             -       81.138            -    X
                            Total (A + B)          -        -       76.037            -          -        -        -       81.138            -           -




Key:
FV = fair value
* FV = fair value calculated excluding changes in value due to changes in the creditworthiness of the issuer after
the date of issue.
NV = nominal value or notional
L1 = Level 1
L2 = Level 2
L3 = Level 3




4.2 Breakdown of item 40 "Financial liabilities held for trading": subordinated
liabilities
There are no subordinated debt.




4.3 Breakdown of item 40 "Financial liabilities held for trading": structured debts
There are no structured debts.




Section 5                           Financial liabilities at fair value - Item 50 -

For the Bank there is no such case.




                                                                                                                                                        137
Section 6                       Hedging derivatives - Item 60 -

6.1 Hedging derivatives: breakdown by type of coverage and levels of hierarchy


                                       Fair Value 31/12/2010                                    Fair Value 31/12/2009
                                                                             VN                                                       VN
                                                                        31/12/2010                                               31/12/2009
                                  L1              L2           L3                          L1              L2           L3

A. Financial derivatives               -          64.840            -      1.306.004            -           51.429           -      1.542.675

 1) Fair value                         -           64.829           -      1.305.312            -           51.429           -       1.542.675
 2) Cash flow                          -               11           -            692            -                  -         -                   -
 3) Foreign Investment                 -                 -          -                  -        -                  -         -                   -
B. Credit derivatives                  -                 -          -                  -        -                  -         -                   -
 1) Fair value                         -                 -          -                  -        -                  -         -                   -
 2) Cash flow                          -                 -          -                  -        -                  -         -                   -
                        Total          -          64.840            -      1.306.004            -           51.429           -      1.542.675




Key:
VN = notional value
L1 = Level 1
L2 = Level 2
L3 = Level 3




138
6.2 Hedging derivatives: breakdown by hedged portfolio and type of coverage

                                                                           Fair Value                                                      Cash Flow

      Transactions / Type                                                                                                                                             Investments
                                                               Specification
               coverage                                                                                             General        Specification        General         Foreign
                                Risk              Risk             Risk                 Risk
                                                                                                    More risk
                                Rate            exchange          Credit                price

1. Financial assets available
                                            -              -                   -                -               -     X                             -      X               X
fo r sale
2. Credits                             19.905              -                   -         X                      -     X                             -      X               X
3. Held
                                 X                         -                   -         X                      -     X                             -      X               X
to maturity
4. Portfolio                                x              x                   x                x               X         43.717                   X              -        X

5. Other operations                         -              -                   -                -               -             X                     -             X                 -
Total Assets                           19.905              -                   -                -               -         43.717                    -             -                 -

1. Financial liabilities                1.207              -                   -         X                      -     X                            11      X               X
2. Portfolio                                                                                                                   -                                  -        X

Total Liabilities                       1.207              -                   -                -               -              -                   11             -                 -

1. Forecast transactions         X                 X                X                    X             X              X                             -      X               X
2. Portfolio of assets and
                                 X                 X                X                    X             X                       -          X                       -                 -
Financial liabilities




                                                                                                                                                                                        139
Section 7 Fair value of financial liabilities cover generic-Item 70 -
For the Bank there is no such case.




Section 8            Tax liabilities, Item 80 -

                                                           Fund
                                                        direct taxes


Balance 31/12/2009                                                32.200
Provision                                                         17.370

Use to pay taxes                                                 (29.024)

Other changes                                                      2.180
Balance 31/12/2010                                               22.726



The table above represents the movement of the current tax liabilities during the year. It
specifies that the bank adheres to c.d. "National tax consolidation" within the meaning of
Article. 117 and following of the Presidential Decree 917 of 22 December 1986 and
subsequent amendments and additions, so credits and debits IRES were transferred to the
parent company and are budgeted in other assets and liabilities, and the movements of the
table refer to IRAP.
The composition of and changes in deferred tax liabilities are exposed with the deferred tax
assets, to Section 13 of this note.




Section 9 Liabilities associated with assets held for sale-Voice 90 -

For the Bank there is no such case.




140
Section 10 Other liabilities - Item 100 -

10.1 Other liabilities: breakdown


                                                                        Total           Total
                                                                    31/12/2010      31/12/2009


Due to tax authorities for withholding taxes payable                       34.841           36.326
Other liabilities - tax consolidation                                      55.739           71.353

Fees and contributions for employees                                       11.380           18.763

Amounts available to customers                                             13.928           55.954

Entries in process                                                         18.754           34.366

Other creditors                                                            39.586           45.437

Suppliers                                                                  19.788           22.778

Valuation currency on foreign exchange transactions and portfolio         218.527          186.630

Float with the branches                                                     9.508           88.111

Impairment on guarantees and commitments                                    4.579            3.904

Other                                                                       5.629            9.681
Total                                                                     432.261         573.303




The debts related to staff skills include the outstanding debt to Social Security for costs
related to plans for voluntary redundancies, which amount to 5,605 thousand euro. They
also include amounts due to other components of pay to employees for deferred delivery.

Payables consist of the consolidated tax debt to the parent company for the income tax
transferred to the Company pursuant to the laws on "national fiscal consolidation."




                                                                                                     141
 Section 11 Provision for employee - Page 110 -

 11.1 Provision for employee severance pay: annual changes


                                                                    Total                    Total
                                                                31/12/2010               31/12/2009

 A. Initial                                                              63.808                   64.922

 B. Increases                                                                7.853                    1.892

   B.1 Provision for the year                                                        -                     3

   B.2 Other changes                                                         7.853                    1.889

 C. Decreases                                                            (9.674)                  (3.006)

   C.1 Severance payments                                                (6.765)                  (2.391)

   C.2 Other changes                                                     (2.909)                       (615)

 D. Closing balance                                                      61.987                   63.808




 The other increases / decreases as well as possible contributions include:
  financial expense of € 1,217 thousand recorded in the income statement;
    actuarial gains and losses accounted for € 2,495 thousand, net of related tax effect
    in valuation reserves.
    changes in fund linked to the operation of local optimization and the contribution of
      the foreign branch or resources to € 4,123 thousand and 2,702 thousand euro
      gained to resources transferred.




 11.2 Other information
 Prospectus summary of the technical basis adopted for assessing the Fund's
 severance pay and bonuses

 31/12/2010

 Mortality Rate                    RGS48 tables were used appropriately modified
                                   on the basis of historic data business.

 Rate of turnover                  We used a special table made from appropriate
                                   averaging of historical data business in recent years.

 Advances in TFR                   The probability of anticipation has been set equal to 100%, while
                                   The average amount required, calculated on the basis of the
                                   standard
                                   civil introduced by the Finance Act 2007, it was estimated
                                   equal to 100%.

 Inflation rates                   The inflationary scenario which is expected to testify in
                                   Long-term use led to a rate of 2% per year

 Discount rates                    For the evaluation to 31/12/2010 was used curve
                                   A composite rates EUR 31 December 2010.




 142
31/12/2009

Mortality Rate     RGS48 tables were used appropriately modified
                   on the basis of historic data business.


Rate of turnover   E 'was used a special table made from appropriate
                   averaging of historical data business in recent years.


Advances in TFR    The probability of anticipation has been set equal to 100%, while
                   The average amount required, calculated on the basis of the standard
                   civil introduced by the Finance Act 2007, it was estimated
                   equal to 100%.


Inflation rates    The inflationary scenario which is expected to testify in
                   Long-term use led to a rate of 2% annually.


Discount rates     For the evaluation to 31/12/2009 was used a rate equal to
                   4.871% obtained as the average rate of the composite curve EUR A
                   30 December 2009 (source: Bloomberg) Weighted
                   relationship between the amount paid / total amount to be anticipated and
                   pay / advance for each maturity until the extinction of
                   population considered.




                                                                                               143
Section 12 Provisions for risks and charges - Page 120 -

12.1 Provisions for risks and charges: breakdown


                                                                                              Total                            Total
                                     Items / Values
                                                                                          31/12/2010                       31/12/2009

1. Company pension fund                                                                                         -                                      -

2. Other risks and charges                                                                         26.301                                     22.999
  2.1 Legal disputes                                                                                    8.651                                  7.274
  2.2 Staff costs                                                                                       6.691                                  4.486
  2.3 Other                                                                                         10.959                                    11.239
Total                                                                                              26.301                                     22.999




The funds for personal expenses consist of the actuarial valuation of bonuses provided for
by existing contracts, support, and provisions for premium and business, for which
negotiations are ongoing with the unions.


12.2 Provisions for risks and charges: annual changes


                                                          Pensions                        Other funds                                 Total


A. Initial                                                                       -                      22.999                                 22.999
B. Increases                                                                     -                       7.744                                  7.744

B.1 Provision for the year                                                       -                       7.362                                   7.362

B.2 Changes due to the passage of time                                           -                            222                                  222

B.3 Changes due to discount rate                                                 -                                  -                                      -

B.4 Other changes                                                                -                            160                                  160

B.5 Business combinations                                                        -                                  -                                      -

C. Decreases                                                                     -                      (4.442)                                (4.442)

C.1 Use during the year                                                          -                      (2.644)                                 (2.644)

C.2 Changes due to discount rate                                                 -                            (92)                                 (92)

C.3 Other changes                                                                -                      (1.706)                                 (1.706)

C.5 Business combinations                                                        -                                  -                                      -

D. Closing balance                                                               -                      26.301                                 26.301




12.3 Company pension funds to defined benefit
There are no funds for retirement defined benefit plans.

12.4 Provisions for risks and charges - Other provisions

                                                                     Increase
                                                                     s                              Decreases
                                         31/12/2009                                                                                      31/12/2010
                                                                                Other                                   Other
                                                              Provisions                           Use
                                                                                changes                                 changes

Litigation                                        7.834              4.041                52       2.073                    1.202                      8.651

Staff expenses                                    3.926              2.833              239             307                       -                    6.691

Other funds                                      11.239                488                91            264                     596                10.959

    referred to insolvency actions                7.619               235                91         264                         590                    7.092
Total                                           22.999               7.362              382       2.644                    1.798                   26.301



The estimates were carried out analytically on individual positions if the counterparty has
already undertaken a legal action and on the basis of a potential estimated on historical
statistical series in presence of objective risk (eg

144
presence of complaints), not yet been invoked in legal proceedings. For funds which
provided the financial outlay has been estimated over the years, we proceeded to determine
the impact of discounting, using as a discount rate Euribor 1 year. The timing of expected
payment on average in the range from 3 to 5 years.


Contingent liabilities

Banco di Brescia is involved in several legal proceedings of various kinds and legal process
arising from the ordinary course of business. While it is not possible to predict with
certainty the final outcome, it is considered that any adverse outcome of these proceedings
would not, individually or together, a significant negative effect on financial and economic
situation of the Bank.

It should be noted that during the month of July 2006, the Court of Appeal of Rome has
issued a ruling favorable to the 2nd degree Banco di Brescia in the face of a dispute with the
Milan
Insurance and ordered to pay the same amount of € 4.9 million to the Bank.
This amount was collected and recorded in the income statement in 2007. Despite the
appeal to the Supreme Court brought by Milano Assicurazioni, there has not been any
provision in that, in the opinion of the Bank's lawyers, the risk of negative outcomes are
considered irrelevant.

Under the tax dispute concerning the annual 2004, 2005 and 2006, refers to all that has
been detailed in the Management Report - more info. On the basis of authoritative opinions
is believed that the tax regime applied by the Bank adheres to the contractual and legal
dictation, and that the findings may therefore result in a positive sense. The risk can be
defined in accordance with IAS 37, can be quantified in a total of 10.13 million euro.




Section 13 Redeemable shares - Item 140 -
For the Bank there is no such case.




                                                                                                 145
Section 14 Heritage Business
           - Items 130, 150, 160, 170, 180, 190 and 200 -
14.2 Share capital and treasury shares: breakdown


                                                                     Total                     Total
                                                                 31/12/2010                31/12/2009

No. ORDINARY SHARES                                                  905.341.516               872.500.000

from Euro face value, each                                                     0,68                     0,68


No TREASURY SHARES                                                                 -                           -
from Euro face value, each                                                         -                           -




Capital 14.2 - Number of shares: annual changes


                                     Items / Types                  Ordinary                    Other



A. Initial number of shares                                                            -                           -
   - Fully paid                                                                        -                           -
   - Not fully paid                                                                    -                           -
A.1 Treasury shares (-)                                                                -                           -
B.2 Shares Outstanding: opening                                        872.500.000                                 -
B. Increases                                                            32.841.516                                 -

B.1 New Issues                                                                         -                           -

   - For a fee:                                                                        -                           -

         - Operations of business combinations                                         -                           -
         - Conversion of bonds                                                         -                           -
         - Exercise of warrants                                                        -                           -
         - Other                                                                       -                           -
   - Free of charge:                                                                   -                           -

         - For employees                                                               -                           -

         - For directors                                                               -                           -

         - Other                                                                       -                           -
B.2 Sale of treasury shares                                                            -                           -
B.3 Other changes                                                        32.841.516                                -
C. Decreases                                                                           -                           -
C.1 Cancellation                                                                       -                           -

C.2 Acquisition of treasury shares                                                     -                           -

C.3 Divestitures                                                                       -                           -

C. 4 Other variations                                                                  -                           -

D. Shares outstanding: closing balance                                 905.341.516                                 -
D.1 Treasury stock (+)                                                                 -                           -
D.2 shares at the end of the year                                                      -                           -

   - Fully paid                                                                        -                           -
   - Not fully paid                                                                    -                           -




After the operation optimization of the Territorial Assembly Extraordinary Shareholders
voted on 11 January 2010 a capital increase by issuing no. 32,841,516 ordinary shares,
this increase is shown in Table B.3 in row.




146
14.3 Share capital: Other information
Nominal value of shares

The share capital is fully subscribed and paid up and was made up of 905,341,516 ordinary
shares of par value Euro 0.68 each.

Rights, preferences and restrictions on shares

On the actions of the bank there are no privileges or liens and, with regard to the
constraints on dividend distributions and repayment of capital, see the prospectus
summary of shareholders' equity by origin and an indication of the possibility use and for
distribution pursuant to art. 2427 paragraph 1, no 7 a d.c. reported at the end of the next
item.


14.4 Retained earnings: other information
Surplus funds amounted to € 517.37 million and are as follows:
    Legal reserve € 90.522 million, an increase of 6.449 million euro is equivalent to the
    resolutions passed by the shareholders last year, in the distribution of profits;
    Extraordinary reserve € 414,669 net of reserves First Time Adoptions (-45.531 Million
      euro), an increase of € 87.791 million is related to the distribution of profits last
    year;
 Fund for general banking risks € 9.56 million;
 Reserve for actuarial gains / losses € 2.409 million;
    Reserve Fund L. 124/93 Art. 13 € 210 000.

For completeness of discussion, we note that the exercise was set a positive reserve under
the Guidelines Preliminary Assirevi (OPI 1), amounting to 120,942 thousand euro, in
connection with the operation of the conferral of territorial and Optimization Branch Foreign
UBI International SA of Luxembourg, as detailed below to
"Statement of changes in equity."




                                                                                                147
Composition of second home equity, availability, and for distribution to 31/12/2010

                                                                                                                           Summary of uses
                                                                                                                      incurred during the three
                                                            POSSIBILITY 'OF         SHARE            BOND                      previous
                                            AMOUNT                                                                            exercises
                                                            USE                   AVAILABLE         TAX (1)
                                                                                                                        cover           for other
                                                                                                                       losses            reasons
A) CAPITAL

-Corporate capital                              615.632            -                            -        142.479                 NO         NO


B) Capital reserve
-Share premium                                  120.000           AB                            -                 -                 -       (2)


C) Retained earnings
-Legal Reserve                                   90.522            B                            -                 -              NO         NO
-Extraordinary reserve                          424.229          ABC                    424.229                   -              NO         (3)
Reserve-reform foresaw. complementary             2.409            -                            -                 -              NO         NO
Reserve-ex D. Lgs. N.124 / 1993                      210           -                            -              210               NO         NO


D) OTHER RESERVES
Reserve OPI-1 ATM switch                        120.942            -                            -                 -              NO         NO
Revaluation Reserve-ex L. No 342/2000             6.773           AB                            -             6.773              NO         NO
Revaluation Reserve-ex L. No 350/2003             6.006           AB                            -             6.006              NO         NO
Reserve-val. financial instr.. dest.vend.         4.587            -                            -                 -              NO         NO
Valuation reserve-IAS                             (3.185)          -                            -                 -              NO         NO



TOTAL                                        1.388.125                                424.229           155.468


Profit for the year-2010                         71.979                       -                 -                 -                 -               -

TOTAL ASSETS (4)                             1.460.104                                424.229           155.468


Key:
A: for capital increase
B: to cover losses
C: for distribution to shareholders

Notes:
(1) Amount of tax suspension.
(2) This reserve is not distributable as the legal reserve has reached the limit set by art. 2430 Civil Code.
(3) In 2005, the special reserve was reduced to € 35.874 million to cover the negative reserves, which have
originated in the transition to international accounting standards.
(4) The share of equity bound under Article. 109, paragraph 4, letter b) Presidential Decree 917/86 is 1.9
million euro.



14.5 Equity instruments: composition and annual changes
There are no equity instruments.



14.6 More information

For the Bank should not be given any information as prescribed by IAS 1, paragraph 136A,
137 and 80A.




148
More information

1. Guarantees and commitments


                                                                        Amount                Amount
                                          Operations
                                                                      31/12/2010            31/12/2009

1) Financial Guarantees given to                                              320.696               346.813

  a) Banks                                                                     21.084                    19.633

  b) Customers                                                                299.612               327.180
2) Commercial Guarantees given to                                             817.854               709.174

  a) Banks                                                                     38.709                     9.933

  b) Customers                                                                779.145               699.241

3) Irrevocable commitments to provide funds                                 1.153.200              1.218.999

  a) Banks                                                                     15.856                    15.097

        i) certain use                                                         15.856                    15.097

        ii) uncertain use                                                               -                         -

  b) Customers                                                              1.137.344              1.203.902

        i) certain use                                                             1.308                  1.309

        ii) uncertain use                                                   1.136.036              1.202.593

4) Commitments underlying credit derivatives: protection sales                          -                         -

5) Assets pledged as collateral for third parties                           1.916.817              1.589.926

6) Other commitments                                                                    -                         -
Total                                                                       4.208.567             3.864.912




The credit risk associated with guarantees issued and commitments is evaluated in a
similar way to cash loans. The part is rated doubtful exposure under "Other liabilities".
The share of commitment to the Interbank Deposit Protection Fund is set out in item
"Guarantees of a financial nature, point a) Banks."
The amount added in point 5) is:
    · the outstanding balance of loans given to securing the operation of Covered Bond;
    · the value of bond funds made available to the Parent Company as collateral for open
         market operations with Bank of Italy.



3. Assets pledged as collateral for own liabilities and commitments


                                                                        Amount                Amount
                                           Wallets
                                                                      31/12/2010            31/12/2009

1. Financial assets held for trading                                                    -                         -

2. Financial assets at fair value                                                       -                         -

3. Financial assets available for sale                                                  -                         -

4. Financial assets held to maturity                                                    -                         -

5. Loans to banks                                                                       -                         -

6. Loans to customers                                                          38.050                    65.330

7. Tangible assets                                                                      -                         -




3. Operating leases
There are no operating leases.




                                                                                                            149
4. Management and brokerage for third parties


                                                                                                                Amount
                                                      Type of service
                                                                                                              31/12/2010

1. Execution of orders on behalf of customers
  a) Purchases                                                                                                                  -
      1. Regulated                                                                                                              -
      2. Unregulated                                                                                                            -
  b) Sales                                                                                                                      -
      1. Adjust                                                                                                                 -
      2. Do not adjust                                                                                                          -
2. Portfolio management                                                                                                    427
  a) Individual                                                                                                            427
  b) collective                                                                                                                 -
3. Custody and administration of securities                                                                        30.695.087
  a) Third party securities on deposit with the depositary bank activities (excluding portfolio management)                     -
      1. securities issued by the reporting bank                                                                                -
      2. Other securities                                                                                                       -
  b) Third party securities on deposit (excluding portfolio management): other                                     14.083.752
      1. securities issued by the reporting bank                                                                    2.632.096
      2. Other securities                                                                                          11.451.656
  c) Third party securities deposited with third parties                                                           14.468.923
  d) securities deposited with third parties                                                                        2.142.412
4) Other operations                                                                                                 4.178.930




Under "other transactions" are given the volumes related to the collection orders for
securities trading.




150
Part C - Income Statement
Section 1                           Interest - Items 10 and 20 -

1.1 Interest income and similar revenues


                                                                                                                        Total               Total
                      Items / Technical forms           Debt         Funding                Other operations
                                                                                                                    31/12/2010          31/12/2009


1. Financial assets held for trading                           304                      -                       -                304                 580

2. Financial assets available for sale                           -                      -                       -                   -                    -
3. Financial assets held to maturity                             -                      -                       -                   -                    -
4. Loans to banks                                                -             64.972                           -          64.972              116.105
5. Loans to customers                                           85          434.504                             5         434.594              544.292
6. Financial assets at fair value                                -                      -                       -                   -                    -
7. Hedging derivatives                                   X              X                                 8.537              8.537               7.987
8. Other activities                                      x              x                                      29                 29                  20
                                                Total          389          499.476                      8.571            508.436              668.984




The item "Loans and advances-loans" includes interest:
               € 49,401 thousand earned on loans given to guarantee emissions
                Covered Bond;
               € 36,878 thousand relating to the securitization.

The amount of interest on impaired assets is approximately 35,500 thousand (€ 30,048.6
thousand euro at December 31, 2009).

The penalty overdraft facility, as described in "Notes - Accounting for overdraft penalty"
amounted to € 8,380 thousand euro.

The item "Loans and advances to customers" include the overdraft charges for a total of €
747 thousand, compared to 15,503 thousand the year before. It is recalled that as of time
from 1 July 2009, following the introduction of the new commission system, such revenue
has become a key component of the
Commission made funds listed among the "Fee and commission income - other services."




                                                                                                                                                     151
1.2 Interest income and similar income differentials on hedging


                                                                         Total                Total
                                             Items
                                                                     31/12/2010           31/12/2009

A. Positive differences on hedging transactions:                                 72.037            111.704

B. Negative differentials on hedging transactions:                           (63.500)             (103.717)
C. Balance (A-B)                                                                  8.537                7.987




The economic effects of hedging transactions, in accordance with the rules prescribed in the
compilation of the bank balance is recognized in the income statement for the imbalance
between interest income, as the positive differences are in absolute value higher than the
shortfalls.



1.3 Interest and other income: other information 1.3.1
Interest income on financial assets in


                                                                       Total                 Total
                                             Items
                                                                    31/12/2010            31/12/2009


Interest income on financial assets in currency                                   1.425                2.477




1.3.2 Interest income on finance leases
There are no transactions of this type.




152
1.4 Interest payable and similar charges: breakdown


                                                                                                                                   Total                       Total
                 Items / Technical forms                   Debts              Titles                 Other operations
                                                                                                                               31/12/2010                  31/12/2009

1. Due to central banks                                                   -      X                                         -                        -                       -

2. Due to banks                                                    (15.809)      X                                         -             (15.809)                 (12.894)
3. Due to customers                                                (35.766)      X                                         -             (35.766)                 (77.229)
4. Securities in circulation                                 X                       (130.243)                             -          (130.243)                  (209.842)
5. Trading financial liabilities                                          -                      -                         -                        -                        -
6. Financial liabilities at fair value                                    -                      -                         -                        -                        -
7. Other liabilities and reserves                            X                   X                                      (13)                 (13)                       (246)
8. Hedging derivatives                                       X                   X                                         -                        -                        -
                                           Total                 (51.575)         (130.243)                         (13)              (181.831)                  (300.211)




1.6 Interest payable and similar charges: other information
1.6.1 Interest expense on foreign currency liabilities


                                                                                                                   Total                                  Total
                                                   Items
                                                                                                                 31/12/2010                             31/12/2009


Interest expense on foreign currency liabilities                                                                               (4.409)                           (11.211)




1.6.2 Interest expense on finance leases



                                                                                                               Total                            Total
                                               Items
                                                                                                            31/12/2010                       31/12/2009


Interest expense on finance leases                                                                                             (13)                              (34)




                                                                                                                                                                          153
                                 Commissions - Items 40 and 50
Section 2                        -

2.1 Fee and commission income: breakdown



                                                                             Total                     Total
                                      Type of service / Values
                                                                         31/12/2010                31/12/2009


a)     Guarantees given                                                                8.340                     7.888

b)     credit derivatives                                                                      -                         -

c) management, brokerage and advisory services:                                       98.772                    95.504

     1. trading                                                                           38                        40

     2. Currency trading                                                               2.528                     2.491

     3. portfolio management                                                                   -                    57

        3.1.       Individual                                                                  -                    57

        3.2.      collective                                                                   -                         -

     4. custody and administration of securities                                       1.845                     2.189

     5. Custodian                                                                              -                         -

     6. placement of securities                                                       38.483                    29.848

     7. activities of reception and transmission of orders                             6.636                     7.873

     8. consultancy                                                                       72                         2

        8.1       In    Investment                                                        72                          2

        8.2 in capital structure                                                               -                         -

     9. distribution of third-party services                                          49.170                    53.004

        9.1. Portfolio management                                                      8.373                     7.538

               9.1.1.       Individual                                                 8.373                     7.538

               9.1.2.    collective                                                            -                         -

        9.2. insurance products                                                       22.948                    22.162

        9.3. other products                                                           17.849                    23.304

d) payment and collection services                                                    30.159                    31.806

e) Servicing for the securitization                                                            -                         -

f) facilities for factoring                                                                    -                         -

g) year tax collection services                                                                -                         -

h) management activities of MTF                                                                -                         -

i) keeping and management accounts                                                    37.763                    38.570

j) other services                                                                     35.179                    27.175

                                                                 Total           210.213                    200.943




"Other services" includes the Commission made funds totaling € 22,088 thousand, 11,953
thousand in the previous year when the new commission system was introduced from 1
July 2009.


The reduction in "Distribution services of third parties: other" is mainly due to lower
commissions on transactions of consumer credit provided by Bank 24 / 7.




154
The details of the fees on other services obtained is shown in the table below.


                                                                                Total                  Total
                           Detail commissions "other services"
                                                                            31/12/2010             31/12/2009


- Loans, mortgages and CDF                                                             27.995                    19.073
- Foreign                                                                                2.179                     2.323
- Other                                                                                  5.005                     5.778

Total                                                                                  35.179                    27.175




2.2 Commission income: distribution channels for products and services
The products and services are wholly located in its branches.




2.3 Fee and commission expense: breakdown



                                                                             Total                   Total
                                        Services / Values
                                                                         31/12/2010              31/12/2009


a) Guarantees received                                                            (2.372)                     (1.581)
b) credit derivatives                                                                       -                           -

c) management and brokerage services:                                             (2.100)                     (3.051)

        1. trading in financial instruments                                       (1.635)                     (2.592)

        2. Currency trading                                                           (136)                             -

        3. portfolio management:                                                         (1)                    (145)

           3.1. own                                                                         -                           -

           3.2. delegated from third parties                                             (1)                    (145)

        4. custody and administration of securities                                   (328)                     (314)

        5. placing of financial instruments                                                 -                           -

        6. door selling of securities, products and services                                -                           -

d) payment and collection services                                                (9.518)                     (9.826)

e) other services                                                                     (963)                   (1.740)

                                                                 Total           (14.953)                (16.198)




The item "received assurances" includes 2,202 thousand euro (1,446 thousand euro at
December 31, 2009) commission to recognize the parent company for bonds issued to
guarantee the issuance of euro commercial paper and deposit made by the foreign branch.

Point c) 1 "trading"Includes brokerage commissions on the stock market and bond approved
by the parent company of € 1,315 thousand, € 2,032 thousand recorded in 2009.
The point) "other services"Includes commissions paid to third parties for brokerage funding
for approximately 816 thousand euro (1,721 thousand euro in 2009).




                                                                                                                            155
Section 3                          Dividends and similar income - Item 70 -

3.1 Dividends and similar income: breakdown


                                                                                     Total                                                           Total
                                                                                 31/12/2010                                                      31/12/2009
                            Items / Income
                                                                                            Income from                                                        Income from
                                                                   Dividends                                                      Dividends
                                                                                                 O.I.C.R.                                                         O.I.C.R.

A. Financial assets held for trading                                                   -                          -                                   -                               -

B. Financial assets available for sale                                            388                             -                                 88                                -
C. Financial assets at fair value                                                      -                          -                                    -                              -
D. Investments                                                                    861                X                                          1.611                X
Total                                                                         1.249                               -                             1.699                                 -




Section 4                          Net income from trading - Item 80 -
4.1 The net result of trading:


                                                                   Profit from                               Losses from
                                                   Gains                                   Losses                                               Net income            Total
           Transactions / Income items                               trading                                   trading
                                                    (A)                                      (C)                                        [(A + B) - (C + D)]       31/12/2009
                                                                        (B)                                       (D)

1. Financial assets held for trading                          86             2.100                   (62)              (1.561)                             563               2.626
  1.1 Debt                                                    78                 324                 (48)                         (5)                      349               1.240
  1.2 Equities                                                 -                   -                     -                        (4)                       (4)                 (9)
  1.3 Quote of O.I.C.R.                                        -                   -                     -                          -                         -                   -
  1.4 Funding                                                  -                   -                     -                          -                         -                   -
  1.5 Other                                                    8             1.776                   (14)               (1.552)                            218               1.395
2. Trading financial liabilities                               -                   -                     -                          -                         -                   -
  2.1 Debt securities                                          -                   -                     -                          -                         -                   -

  2.2 Debts                                                    -                   -                     -                          -                         -
  2.2 Other                                                    -                   -                     -                          -                         -                   -
3. Financial assets and liabilities: differences     X                  X                    X                    X                                           -                 46
In exchange rate
4. Derivatives                                             4.210            76.108               (4.574)              (87.574)                       (9.893)                 2.842

  4.1 Financial derivatives:                               4.210            76.108                (4.574)             (87.574)                        (9.893)                2.842
      - On debt securities and interest rates              3.815            74.612                (4.179)             (86.152)                      (11.904)                 2.362
      - On equity securities and equity indices                -                   -                     -                          -                         -                  1
      - On foreign currency and gold                 X                  X                    X                    X                                    1.937                   428
      - Other                                                395             1.496                  (395)               (1.422)                             74                  51
  4.2 Credit derivatives                                       -                   -                     -                          -                         -                   -
Total                                                      4.296            78.208               (4.636)              (89.135)                       (9.330)                 5.514




The negative result is mainly due to net losses arising from unwinding Securities
macrocopertura of assets, resulting in the reduction of the activities covered by settlements,
rescheduling and default crossings, for a total of 12,269 thousand euro, and included losses
from trading in financial derivatives on debt securities and foreign interest.




156
Section 5                    Net income from hedging - Item 90 -
5.1 The net result of hedge accounting: breakdown


                                                                   Total                    Total
                          Income components / Values
                                                               31/12/2010               31/12/2009


A. Income from:
A.1 Hedging derivatives fair value                                      44.706                   17.986
A.2 Hedged financial operations (fair value )                           43.875                       3.337

A.3 Hedged financial liabilities (fair value )                          28.536                   15.806

A.4 Cash-flow hedges                                                                -                        -

A.5 Assets and liabilities denominated in foreign currencies                        -                        -

Total income from hedging activities (A)                               117.117                   37.129

B. Losses on:

B.1 Hedging derivatives of fair value                                  (70.546)                 (14.728)
B.2 Hedged financial operations (fair value )                          (23.057)                  (6.819)

B.3 Hedged financial liabilities (fair value )                         (15.605)                 (11.244)

B.4 Cash-flow hedges                                                                -                        -

B.5 Assets and liabilities denominated in foreign currencies                        -                        -

Total losses on hedging activities (B)                               (109.208)                  (32.791)

C. Net income from hedging activities (A-B)                                 7.909                    4.338




                                                                                                                 157
Section 6                      Gains (losses) on sale / repurchase - Page 100 -

6.1 Profit (loss) on sale / repurchase composition


                                                                                    Total                                                   Total
                                                                                31/12/2010                                              31/12/2009
                             Items / Income

                                                                 Useful           Losses             Net income          Useful           Losses             Net income


Financial Assets
1. Loans to banks                                                           -                    -                   -              -                    -                        -

2. Loans to customers                                                       -                    -                   -              -                    -                        -
3. Financial assets available for sale                                      -                    -                   -            491                    -                 491

      3.1 Debt                                                              -                    -                   -              -                    -                        -

      3.2 Equities                                                          -                    -                   -            491                    -                 491

      3.3 Quote of O.I.C.R                                                  -                    -                   -              -                    -                        -

      3.4 Funding                                                           -                    -                   -              -                    -                        -
4. Financial assets held to maturity                                        -                    -                   -              -                    -                        -

Total assets                                                                -                    -                   -            491                    -                 491

Financial liabilities

1. Due to banks                                                             -                    -                   -              -                    -                        -

2. Due to customers                                                         -                    -                   -              -                    -                        -

3. Titles movement                                                        682                (738)                (56)            519                (658)                (139)

Total liabilities                                                         682                (738)                (56)            519                (658)                (139)




Section 3.2, at 31 December 2009, includes about 486,000 euro as a transfer price adjustment of the interest in Central
Budgets, which was sold in 2008.




158
Section 8               Adjustments / recoveries on impairment - Page 130 -
8.1 Impairment losses on loans: breakdown


                                              Write-downs (1)                                                                              Write-backs (2)


 Transactions /                        Details                                                                             Details                                         Portfolio                     Total                Total
        Income                                                                                                                                                                                       31/12/2010           31/12/2009
                                                                                 Portfolio
                            Cancellations               Other                                                  Interest                Other                    Interest                 Other



A. Loans to banks                             -                        -                          -                            -                        -                        -               -                    -                    -
  - Funding                                   -                        -                          -                            -                        -                        -               -                    -                    -

  - Debt                                      -                        -                          -                            -                        -                        -               -                    -                    -

B. Loans to customers              (29.171)                 (65.840)                   (20.686)                        4.416                   13.422                            -               -         (97.859)             (69.220)

  - Funding                        (29.171)                 (65.840)                   (20.686)                        4.416                   13.422                            -               -         (97.859)             (69.220)

  - Debt                                      -                        -                          -                            -                        -                        -               -                    -                    -
C. Total                           (29.171)                 (65.840)               (20.686)                            4.416                   13.422                            -               -        (97.859)              (69.220)




8.2 Net adjustments for impairment of financial assets available for sale:


                                     Write-downs (1)                             Write-backs                     (2)

 Transactions /                                                                                                                           Total                       Total
                                            Details                                        Details
        Income                                                                                                                          31/12/2010                31/12/2009


                             Cancellations               Other              interest                          other

A. Debt                                       -                        -                              -                            -                        -                        -

B. Equities                                   -                        -X                                 X                                                 -                  (94)

C. Quote O.I.C.R.                             -                        -X                                                          -                        -                        -

D. Loans to banks                             -                        -                              -                            -                        -                        -

E. Loans to customers                         -                        -                              -                            -                        -                        -

Total                                         -                        -                          -                                -                        -                  (94)



The amount at 31 December 2009 relates to the write position of the line more.


                                                                                                                                                                                                                                159
8.4 Impairment losses on other financial transactions: breakdown


                                             Write-downs (1)                                                       Write-backs (2)

 Transactions /                                                                                                                                                  Total           Total
                                        Details                                                     Details                               Portfolio
        Income                                                                                                                                               31/12/2010       31/12/2009
                                                                         Portfolio
                             Cancellations            Other                              Interest         Other                Interest          Other

A. Guarantees given                          -                 (1.092)         (684)                -             989                     -              -           (787)           (1.065)
B. Credit derivatives                        -                       -               -              -               -                     -              -                -                -
C. Commitments to disburse
funds                                        -                       -           (62)               -               -                     -              -            (62)             (189)

D. Other operations                          -                       -               -              -               -                     -              -                -                -

E. Total                                     -                 (1.092)         (746)                -             989                     -              -           (849)           (1.254)




160
Section 9 Administrative expenses - Page 150 -

9.1 Personnel expenses: breakdown


                                                                                           Total                  Total
                                   Type of expense / Values
                                                                                       31/12/2010             31/12/2009


1) Employees                                                                                  (172.671)              (164.425)
  a) Wages and salaries                                                                        (118.269)              (114.196)
  b) Social contributions                                                                       (30.370)               (30.978)
  c) Severance pay                                                                                  (8.111)                (7.781)
  d) Social security costs                                                                                -                      -
  e) Provision for severance indemnities                                                            (1.294)                (2.258)
  f) Provision for treatment of retirement payments and similar obligations:                              -                      -
    - Defined contribution                                                                                -                      -
       - Defined benefit                                                                                  -                      -
  g) Payments to external pension funds:                                                            (6.526)                (6.013)
    - Defined contribution                                                                          (6.526)                (6.013)
       - Defined benefit                                                                                  -                      -
  h) Costs related to share-based compensation -                                                          -                      -
  i) Other benefits to employees                                                                    (8.101)                (3.199)
2) Other staff activities                                                                            (465)                  (270)
3) Directors and auditors                                                                       (1.756)                (1.800)
4) Retired personnel                                                                                    (6)                      -
5) Recovery of expenses for employees assigned to other companies                                   5.399                  5.427
6) Reimbursements for dependent related expenses for contractors                                (3.344)                (4.056)
                                                                               Total          (172.843)              (165.124)




Under the heading "Directors" also includes the remuneration of the Board of Auditors.



The expenditure item "Other benefits to employees," 31 December 2010, includes € 3,869
thousand in charges related to the incentives plan, as shown in the "Other information - the
union agreement of 20 May 2010."




                                                                                                                              161
9.2 Average number of employees per category


                                                                           Total                Total
                                                                       31/12/2010           31/12/2009

1) STAFF                                                                            2.533                2.515

      a. leaders                                                                       44                   52

      b. total managers                                                               955                  876

      c. Remaining staff                                                            1.534                1.587

2) OTHER STAFF                                                                         30                   26




The staff includes staff seconded to other companies, and excludes the company's
employees seconded to other companies. Under the heading of other staff include
administrators, auditors and employees with temporary contracts.


9.3 Company pension funds to defined benefit: total costs
There are no defined benefit pension funds.



9.4 Other benefits to employees
The main components of the aggregate "other benefits for employees are:
      ·    incentives and income support for € 3,901 thousand, an increase over the previous
           year is due to the repeatedly commented Agreement of 20 May 2010;
      ·    expenditure on food stamps for 2,569 thousand euro (1,778 thousand euro cost
           2009).

Please note that there are no cost items in IAS 19, paragraphs 131, 141 and 142.




162
9.5 Other administrative expenses: breakdown


                                                               Total                     Total
                           Type of service / Values
                                                           31/12/2010                 31/12/2009


  A. Other administrative expenses                                (129.614)                  (131.237)

  Rental expense                                                       (13.557)                  (12.855)

  Professional services and advice                                      (3.595)                    (4.919)

  Fees lease hardware, software and other goods                         (2.524)                    (3.262)

  Maintenance hardware, software and other goods                        (1.520)                    (2.305)

  Conduction properties                                                 (7.319)                    (7.712)

  Maintenance buildings and equipment                                   (4.267)                    (3.401)

  Counting, transport and management values                             (3.554)                    (3.557)

  Membership fees                                                       (1.148)                    (1.253)

  Information and searches                                              (1.486)                    (1.554)

  Books and periodicals                                                   (226)                      (271)

  Post                                                                  (4.771)                    (5.165)

  Insurance premiums                                                    (6.698)                    (8.607)

  Advertising and promotion                                             (3.380)                    (3.113)

  Representation                                                          (149)                      (204)

  Telephone and data transmission                                       (7.731)                    (6.609)

  Outsourcing Services                                                  (4.721)                    (4.476)

  Travel expenses                                                       (2.764)                    (2.448)

  Service fees made by group companies                                 (54.193)                  (53.130)

  Cost of debt                                                          (2.280)                    (2.632)

  Printing, stationery and mat. Consumption                             (1.345)                    (1.180)

  Transport and removals                                                  (918)                      (993)

  Surveillance                                                          (1.380)                    (1.537)

  Transaction costs of aggregation UBI                                            -                          -

  Other expenditure                                                         (88)                      (54)

  B. Indirect taxes                                                (27.810)                      (26.761)

  - Indirect taxes                                                        (908)                      (895)

  - Stamp duty                                                         (20.824)                  (20.065)

  - Local property taxes                                                  (883)                      (911)

  - Other taxes                                                         (5.195)                    (4.890)
  Total                                                           (157.424)                  (157.998)




The item "professional services and advice" included, 31 December 2009, 1,100 thousand
euro of costs related to the securitization.




                                                                                                                 163
Section 10 Net provisions for risks and charges
           - Item 160 -
10.2 Net provisions for risks and charges: breakdown


                                                                       Provisions         Reallocations                Net provisions


Litigation                                                                     (4.043)               1.152                    (2.891)
Staff expenses                                                                       -                      -                        -
Other funds                                                                      (539)                    555                      16
      referred to rescission actions                                             (285)                    549                    264
Total                                                                          (4.582)               1.707                    (2.875)




Section 11 Impairment / write-backs on property and equipment
           - Item 170 -
11.2 Adjustments / write-backs on equipment: breakdown


                                                              Adjustments
                                           Depreciation        value for            Write-backs     Net income
             Assets / Income                                                                                           31/12/2009
                                              (A)            impairment               (C)          (A + b-c)
                                                                  (B)
A. Tangible assets
 A.1 Owned                                      (10.073)                (12)                  -           (10.085)           (11.064)
      - Used in operations                        (9.083)               (12)                  -             (9.095)           (10.053)
      - Investment                                  (990)                  -                  -               (990)             (1.011)
 A.2 Acquired under financial lease                   (21)                 -                  -                 (21)               (32)
       - Used in operations                           (21)                 -                  -                 (21)                (32)
      - Investment                                       -                 -                  -                    -                   -
Total                                          (10.094)                 (12)                  -           (10.106)           (11.096)




The point "A.1 b" represents a deterioration of the value of certain assets (carpets) of the
foreign branch.



Section 12 Impairment / write-backs on intangible assets
           - Item 180 -

12.2 Impairment / write-backs on intangible assets: breakdown


                                                              Adjustments
                                            Depreciation       value for            Write-backs     Net income
              Activity includes / Income                                                                               31/12/2009
                                               (A)           impairment               (C)          (A + b-c)
                                                                   (B)
A. Intangible assets
 A.1 Owned                                            (10)              (24)                  -                 (34)              (9)
     - Generated internally by                           -                 -                  -                    -                -
     - Other                                          (10)              (24)                  -                 (34)              (9)
 A.2 Acquired under financial lease                      -                 -                  -                    -                -
Total                                                 (10)              (24)                  -                 (34)              (9)



The adjustments for the impairment relate to the software of the foreign branch.




164
Section 13 Other net income - Page 190 -

13.1 Other operating expense: breakdown


                                                                             Total                  Total
                        Detail Other operating expenses
                                                                         31/12/2010             31/12/2009


Charges for cash contracts of public bodies                                           (2.858)                (2.896)
Charges for exchange with antergata                                                     (166)                (1.436)

Depreciation of leasehold improvements                                                  (961)                  (963)

Other charges                                                                         (1.659)                (5.925)

Total                                                                                 (5.644)            (11.220)




13.2 Other operating income: breakdown


                                                                             Total                  Total
                         Detail Other operating income
                                                                         31/12/2010             31/12/2009


Rental income on real estate                                                           1.095                  1.128
Recovery of stamp duty and tax replacement                                            24.103                 23.491

Recovery of expenses and other income on deposits and current accounts                 3.657                 10.146

Income from exchange with antergata                                                        99                 1.042

Income from operations covered bonds / securitization                                  5.086                  2.226

Recovery of costs by group companies                                                     809                    801

Other income and expense recoveries                                                    8.781                 15.655

Total                                                                                 43.630                 54.489




                          Imbalance charges / income                                  37.986                 43.269




Substantial reduction in the costs and income, the penalty for transfers with antergata
currency, is due to the adoption of the SEPA rules, which basically prevents the execution of
such orders.




                                                                                                                       165
Section 17 Income (loss) on disposal of investments - Item 240 -
17.1 Profit (loss) on disposal of investments: breakdown



                                                               Total                    Total
                         Income items / values
                                                           31/12/2010               31/12/2009


A. Real Estate                                                          1.295                       -
  - Profit on disposal                                                  1.295                       -

  - Losses on disposal                                                          -                   -

B. Other activities                                                         1                    (76)

  - Profit on disposal                                                      1                       -

  - Losses on disposal                                                          -                (76)
Net income                                                              1.296                    (76)




166
Section 18 Income taxes from continuing operations - ITEM 260 -
18.1 Income tax from continuing operations: breakdown


                                                                       Total                  Total
                              Income components / Values
                                                                   31/12/2010             31/12/2009

1. Current taxes (-)                                                       (64.978)               (89.853)

2. Changes in current taxes from previous years (+/-)                                 -                         -

3. Reduction of current tax year (+)                                                  -                         -

4. Change in prepaid taxes (+/-)                                                8.351                   4.863

5. Change in deferred taxes (+/-)                                               9.676                  13.403

6. Taxes for the year (-) (-1 + / -2 +3 + / -4 + / -5)                     (46.951)               (71.587)




For more detailed information please refer to the Management Report - Other information -
Tax Aspects.




                                                                                                          167
18.2 Reconciliation of theoretical tax and actual tax burden


                                           IRES                        Taxable    IRES             %


IRES theoretical tax                                                  118.929       (32.706)       27.50%

Permanent

upturn
  - Non-deductible impairment of AFS securities                              46             (13)    0.01%
  - Interest expenses not deductible                                    6.762            (1.859)    1.56%
  - Other expenses not deductible                                       4.934            (1.357)    1.14%
  - telephone charges                                                     303               (83)    0.07%

  - rounding                                                                  -            (171)    0.14%

Permanent

downturn
  - untaxed dividends                                                  (1.187)              326    (0.27%)
  - Interest expenses not deductible                                   (1.386)              381    (0.32%)

  - Other decreases                                                    (2.069)              569    (0.48%)
  - IRES credit for 10% refund IRAP                                           -           2.374    (2.00%)
IRES actual tax burden                                                126.332       (32.539)       27.36%


                                           IRAP                        Tax        IRAP             %


IRAP theoretical tax charge                                           118.929        (5.732)        4.82%

Permanent

upturn
  - Staff costs are not deductible for IRAP purposes                  172.843            (8.331)    7.01%
  - Value adjustments to loans are not deductible for IRAP purposes    98.662            (4.755)    4.00%
  - Non-deductible impairment of AFS securities                              46              (2)    0.00%

  - Risk provisions                                                     2.875              (139)    0.12%
  - Non-deductible depreciation and administrative expenses            17.588              (848)    0.71%
  - Non-deductible interest expense                                     7.273              (351)    0.30%
  - Income tax recovery                                                (5.072)              244    (0.21%)
  - other non-deductible costs                                          3.844              (185)    0.16%

Permanent

downturn
  - Dividends                                                            (625)               30    (0.03%)
  - Cuneo tax deductions                                              (53.675)            2.587    (2.18%)
  - Other changes                                                      (1.458)               70    (0.06%)
  - Deferred tax return as a framework for EC                                 -           3.000    (2.52%)
Actual IRAP tax burden                                                361.230       (14.412)       12.12%

Total effective tax burden IRES and IRAP                              118.929       (46.951)       39.48%
168
Section 21 Earnings per share

The Bank's shares are not traded on financial markets, therefore, is not provided the
information regarding earnings per share.

Please note that the dividend from the profit for 2009 amounted to Euro 0.037 for each n.
872,500,000 shares constituting the share capital. In 2010, the proposal of allotment,
under approval, provides for the distribution of a dividend of € 0.020 for each n.
905,341,516 shares.




                                                                                            169
Part D - Comprehensive income

Analytical statement of comprehensive income

                                                                                             Tax
                                               Voices                   Gross Amount                      Net amount
                                                                                           income


 10. Net income (loss)                                                       X               X                71.979
      Other comprehensive income
 20. Financial assets available for sale:                                        (5.530)            338        (5.192)
       a) changes fair value                                                     (5.530)            338        (5.192)
       b) Transfer to income statement                                                 -              -                -
        - Adjustments for impairment                                                                                   -
        - Profit / loss on disposal                                                                                    -
       c) other changes                                                                                                -
 30. Tangible assets                                                                                                   -
 40. Intangible assets                                                                                                 -
 50. Hedges of foreign investments:                                                    -              -                -
       a) changes fair value                                                                                           -
       b) Transfer to income statement                                                                                 -
       c) other changes                                                                                                -
 60. Cash flow hedges:                                                               (1)             0             (0)
       a) changes fair value                                                         (1)             0             (0)
       b) Transfer to income statement                                                                                 -
       c) other changes                                                                                                -
 70. Exchange rate differences:                                                        -              -                -
       a) changes in value                                                                                             -
       b) Transfer to income statement                                                                                 -
       c) other changes                                                                                                -
 80. Non-current assets held for sale:                                                 -              -                -
       a) changes fair value                                                                                           -
       b) Transfer to income statement                                                                                 -
       c) other changes                                                                                                -
 90. Gains (losses) on defined benefit plans                                     (2.526)            695        (1.832)
100. Quote of the valuation reserves of equity investments in equity:                  -              -                -
       a) changes fair value                                                                                           -
       b) Transfer to income statement                                                 -              -                -
        - Adjustments for impairment                                                                                   -
        - Profit / loss on disposal                                                                                    -
       c) other changes                                                                                                -
110. Total other income components                                               (8.057)         1.033        (7.024)
120. Comprehensive income (Item 10 +110)                                               X             X        64.955




170
Part E - Information on risks and hedging policies
In compliance with current statutory provisions, the UBI has set up a system of risk control
that adjusts the integrated guidelines of the Internal Control System, to be understood as
organizational, regulatory and methodological, with which all Group companies must follow
in order to allow the parent to pursue, effectively and economically address the activities
and strategic control, management and technical-operational.

The Bank works proactively to identify risks and is subject to the definition of such metrics,
management and control.

The key principles to which they refer analysis and risk management of the Group, in order
to pursue a more conscious and efficient allocation of economic capital and regulatory
framework are:
    · strict control of risks and financial credit and strong presence on all types of risk;
    ·    Using the logic of sustainable value creation in the definition of risk appetite and
         capital allocation;
    ·    variation in risk appetite of the Group with reference to specific types of risk and / or
         specific activities in a body of legal policy at a group level and individual entity.

In this Part shall be provided information regarding risk profiles listed below, its
management policies and coverage implemented by the Bank operations in financial
derivatives:
   a)   credit risk;
   b)   market risks:
         · interest rate,
         · price,
         · exchange
   c)   liquidity risk;
   d)   operational risks.

For an overview of risks and uncertainties surrounding the bank, see the specific paragraph
of the Report, prepared in accordance with the provisions of Legislative Decree 32, February
2, 2007, implementing Directive 2003 / 5
1/CE.


Section 1 Credit risk Qualitative
information 1. General

The strategic lines, the policy and tools for the recruitment and management of credit risk
are defined within the parent company, from the Risk Management in consultation with the
Area Claims, with the support and the sharing of specialist facilities in charge.
In policy on credit risk management is given special attention to maintaining an appropriate
risk / return profile and risk-taking consistent with the risk appetite defined by senior
management and, more generally, with the mission of UBI.
The credit risk management policies are primarily aimed at supporting local economies,
families, entrepreneurs, professionals and small-medium enterprises.

                                                                                                     171
The particular attention paid to the maintenance of relations with customers and their
development over time are a strong point of the group, encouraging the killing of
information asymmetries and providing continuity of relationship and customer support
itself in a long term perspective .
Even in the complex business cycle in place, while preserving the quality of assets, the
Ensure an adequate supply of bank credit to the economy, among other things, adhering to
the "agreement" concluded between the Italian Banking Association, the Ministry of Finance
and Trade Associations.

With reference to the market Corporate and Small Business are no specific credit policies to
address development of the credit portfolio in terms of geographical area, industry sector
and credit rating. The credit policies support the network in determining the goal of creating
value in a particular area / sector / counterparties and assessing the creditworthiness of
the counterparties.

The credit policies are transmitted through the network:
      ·   process facilitated by instructors counterparts belonging to the cluster of interest;
      ·   initiatives aimed at containing the risk profile and to limit the negative impact on
          value creation of portfolio (corrective pricing actions and collection guarantees /
          revisions lines) to the counterparties of the clusters is not attractive.

Finally, particular attention is paid to the definition of lines of treatment of new products,
developing adequate information to top management about compliance with the objectives
risk / return, calculation of minimum rates of delivery, quality of the borrower, collateral
received and expected recovery rates in event of insolvency.



2. Policies for managing credit risk
2.1 Organizational aspects

In the course of traditional credit intermediation, the Bank is exposed to the risk that loans
are not repaid by the borrowers paid at maturity and should be partially or fully
depreciated. More specifically, the risk profile in lending is sensitive to the economy as a
whole, the deteriorating financial condition of counterparties (illiquidity, insolvency, etc..) Or
to change their competitive position, the structural changes technology or the debtor firms,
and other external factors (eg legislative changes, deterioration of the value of collateral
linked to the performance of the market). A further element of risk to which it pays
particular attention, is the level of diversification of loan portfolio among different borrowers
and among the several areas in which they operate.

The organizational model under which have been structured units that run the credit,
presents the following article:
          Structures of the parent company of centralized control and coordination;
          General Directorates of Banks and its subsidiaries, on which they depend:
          ·   Credit Management,
          ·   Resolution Peripheral poles,
          ·   Branches,
          ·   Management Unit of the Corporate customers (CBU)
          ·   Unit for the Management of private customers (PBU).

The characteristics of this organizational model, besides allowing a strong homogeneity
between the structure of the Parent Loans and other similar structures of the network
banks, resulting in a linear process and optimization of information flows, have highlighted
the clear distinction between the functions of trade and credit. The granting of credit is also
differentiated by customer segment (Retail / Private, Corporate and



172
Institutional) and specialized state of the same, "performing" (administered by the Claims
Unit
Retail, Private and Corporate) and problematic (managed by the unit performing loans).
Within the Bank, in addition, the introduction of Resolution Peripheral Poly (PDP)
decentralized, to support the Retail branches and facilities in defense of private customers,
ensure the effective coordination and connection of the units operating in the jurisdiction.
The
Parent Company, through the structures of the Credit, Macro Areas of Risk Control and
Strategic Planning and Development Area, the Debt Collection and Audit of Parent and the
Group, oversees the management of policies, monitoring overall portfolio, all ' refinement of
evaluation systems, credit management problem and respect the rules.
For all subjects (individuals or economic groups) with credit facilities in place for banks and
companies (including risk assets attributable to issuer risk and the risk derivatives) total in
excess of € 50 million, the parent company to decide an operating limit be considered as an
upper limit of reliability of the counterparty at the level of UBI.
Banks and the Group Companies also must apply to the Parent the expression of a non-
binding advisory opinion prior to the face of any combination of: a) the amount of trust and
b) certain classes of internal ratings.

The structures through which to articulate the product companies and banks taking skills
and commercial credit policy and control responsibilities and activities carried out directly
on those established by the hierarchical units employees. In particular, responsibility for
managing and monitoring the credit is given to performing in the first instance, the
relationship managers who maintain a daily relationship with customers and have an
immediate perception of possible signs of trouble or quality deterioration credit. However, all
employees of Group companies are required to report promptly any information that might
enable the early detection of problems or can suggest different ways of managing
relationships, taking part - in fact - the monitoring process.

In the second instance of the organizational unit that monitors the credit risk - called
Presidio Monitoring Credit Quality - carries out monitoring, supervision and analysis of
positions "performing" in terms of analytical aggregates, with intensity and depth graded
according bands allocated to the counterparty risk and severity of abnormalities detected
andamentali. The structure - not involved in iterating the deliberative expectations - on its
own initiative or at the proposal, evaluates and provides (or offers to decision makers more
bodies if the decision goes beyond its powers) proper classification of counterparties
pejorative "performing" asking the Area Loans -
Service Credits Italy - Staff Opinions of UBI Banca, in the cases provided for in the Credit,
the issuance of preliminary opinion is not binding. Credits in Area of UBI Bank, the Presidio
and Monitoring Service Credit Quality has the task of coordination and definition of
guidelines for monitoring the loan portfolio, a garrison in the development of instruments for
monitoring, control of credit policies and preparation of reports directional.


2.2 Management, measurement and control

The service credit risk of the parent company is responsible for producing the information
on the credit risk of the Bank, designed to monitor the progress of the riskiness of lending.
The report - submitted quarterly to the Board of
Directors of the Bank - to illustrate the distributions of internal rating classes, and LGD
Expected Loss, and then the trend of average riskiness of the loan portfolio, with focus on
the corporate market, and the retail market, separately for businesses and individuals;
describe the trend rate of decline in lending, a section dedicated to the quarterly monitoring
policy of concentration and quality of credit in terms of distribution among uses and values
of risk parameters.
The complex models that constitute the Group's internal rating system is managed from the
Area Risk Management and the Parent Loans.

                                                                                                  173
At present, the structure involves the use of automatic models for individuals and smaller
businesses, models with automatic integration of qualitative questionnaire and form geo-
industry for medium-large, and a model primarily judgmental for large credit lines (credit
lines or business groups with more than 20 million €).

With reference to the Basel 2 project, took place in a series of activities designed to bring
into production in 2011 a new generation of rating models and estimation
LGD for the portfolio, partly as a result of interaction with the Supervisory Authority.
The main elements of this new generation of rating models are:
        the review of credit risk segmentation, which defines which model applies to each
        party;
        the development of a new quantitative component, which provides internal models of
        analysis of the financial component, abandoning the use of a model provided by an
        outside provider;
        the development of new engines of integration between the different components of
        quantitative analysis
        the development of new qualitative surveys;
        a different mode of implementation of information relating to the Economic Group of
        belonging within the models of rating systems;
        a different way of updating the rating to ensure the optimal mix between the need to
        incorporate more information and to maintain a level of volatility.

With reference to the LGD, it was decided to update the parameters for use in management
in December 2010 and development of the regulatory model to be used for the parallel
running in 2011.

With regard to the rating models in production today, in 2010 has provided periodic updates
of estimates of the probability of default for all models (excluding the Great Trust model,
which will be decommissioned in 2011).

The units involved in the delivery and renewal of credit use internal ratings, which are
essential and indispensable assessments made at the appraisal and review of exposures, the
articulation of powers is defined taking into account the risk profile of the customer or the
transaction as represented by the rating, and managed through the application of practices
Electronics Fido (PEF). The ratings are used in both the management reporting system, and
information flows available to the structures involved in the Bank's credit process.

The assignment of a rating class different from that calculated by the internal rating system
is based on the models adopted by proposing an override the rating. These changes are
motivated by the evaluation of information not considered by the rating model, the model
does not adequately weigh or whose influence future means anticipating.

As prescribed by the Bank of Italy circular n.263/2006 on New regulations
Watch for the Banks, the Group will maintain the current standard methodology for the
determination of regulatory capital. In particular, the class regulatory exposures
"Companies and other entities" was chosen to take advantage, when available, the external
evaluation of the credit provided by Moody's and Cerved Group (formerly Lynx) recognized
ECAI (External Credit Assessment Institution ) by the Bank of Italy.

For the process of calculating collective loans - consistent with the determinations made by
the parent company - uses a methodology based on internal ratings and estimates of loss
given default (LGD).



174
During 2010 also continued the work of revision, updating and adoption of policies and
regulations for the management of credit risk.
Listed below are policies in place, with a nod to the main content.
        Credit risk policy, Which governs in a single text, the provisions relating to garrison
        case of credit risk in previously treated in different policies. This policy is normally
        the following situations:
          · ordinary customers, setting standards, and principles for the management of
             credit limits to ordinary customers based on the availability of internal ratings.
             The articulation of the limits is embodied in a series of indicators expressed in
             terms of: capital allocation, the maximum values of risk (ie the maximum
             expected loss and target), limits of risk-taking in terms of the distribution of
             exposures to rating grades and principals of quality;
          · institutional counterparts and ordinary residents in countries at risk, which sets
             rules and principles for the management of credit granted to resident and non-
             resident institutional clients, as well as ordinary customers residing in countries
             at risk. As in the case of ordinary customers, the joint limits is embodied in a
             series of indicators expressed in terms of: capital allocation, risk-taking limits in
             terms of the distribution of exposures to rating grades and deans in the country
             and quality;
          · concentration risk single nameLaying down maximum exposure limits on
             individual counterparties in order to reduce the risk of instability that would
             result from high levels of concentration of loans on large borrowers in the event
             of any default of the same;
        Policy of offering mortgages through brokers, Which governs the conduct of redress
        external networks for the provision of loans to non-captive customers, in order to
        limit potential credit risks, operational risks and reputational risks;
        Policy on portability, renegotiation, substitution and early repayment of loans score
        direct banking networks, which provides guidelines for the implementation of UBI
        portability active and passive operations, rescheduling, relief and early repayment
        (partial or total) of loans, in order to ensure (even by establishing minimum levels of
        service), the maximum reduction of the time, and the associated costs of compliance
        and to provide the Group with the appropriate processes and tools for risk
        management (credit, operational and reputational);
        Policy on portability, Renegotiation, substitution and early repayment of loans traded
        with brokered loans related to the operation on the basis of agreements between the
        companies / banks of the Group and specific distribution networks;
        Policy risk-adjusted pricing which defines the process of defining and logical
        implementation of risk adjusted pricing for the different products that will be taking
        credit risk;
        Policy on the risk from securitization, Which defines the guidelines that the Group is
        posed with reference to the management of risk arising from securitization activities;
        Policy on residual risk, Which defines the strategic guidelines relating to the
        management the "residual risk" by defining the process of controlling the acquisition
        and use of mitigation techniques for credit risk mitigation in the subject.


2.3 Technical Risk Mitigation Credit

The bank employs risk mitigation techniques typical of the acquiring bank by the
counterparty, for certain types of credit lines, collateral, real estate, financial, and personal
guarantees. The determination of the total amount of credit could be granted to the same
customer and / or group legal and business takes account of specific criteria for weighting
the different categories of risk and guarantees. In particular, the estimated value of the
collateral are applied to "waste" prudential, differentiated by type of security.

                                                                                                     175
The main types of collateral taken by the Group were:
      · mortgage real;
      · pawn.

To ensure the existence of general and specific requirements for recognition of collateral for
prudential purposes, are counted among the techniques of Credit Risk Mitigation (CRM) - as
required by the Bank of Italy Circular No 263 dated 27/12/2006 and subsequent updates -
the UBI Group:
      · redefined the processes of credit relating to the collection and management of
          guarantees. With particular reference to the mortgage, the Network Banks is no
          requirement for inclusion in the appropriate computer application available to
          operators, all the data for the property needed to make the guarantee Eligible.
          Particular attention was paid to the compulsory jurisdiction of the expertise and
          timely retrieval of information inherent in it, including the notary (notarial details of
          registration), critical for the completion of the warranty.
      · recovered for a Mortgage in place all the necessary information to ensure their
          eligibility in line with the provisions of Basel 2 in terms of specific requirements.

In general, during 2010 have been consolidated solutions that enable organizational and
collateral management processes according to defined stages of development, enhancement
and monitoring.


2.4 Impaired financial assets

The classification of the portfolio problem coincides with the provisions of the legislation and
can be summarized as follows:
       ·   past due and / or past continuously,
       ·   restructured loans,
       ·   ground,
       ·   suffering.

In addition to these classes, there remains a case of problem loans related to "country risk"
for unsecured exposures to customers, institutional and ordinary, belonging to countries
defined as "at risk" as defined by the Supervisory Body.
In particular, with regard to the "substandard" in order to optimize the garrison if they carry
out, for the sole purpose of management, a division of the positions in which the objective
difficulties of a temporary situation is considered solved in a short time (usually in the 9
exceptionally be extended for a further month 3 months), and the remaining positions,
where deemed appropriate disengagement from the relationship with a court within a period
of recovery time longer. Moreover, the "past due and / or past a continuous" are subject to
controls to determine, within a maximum of 60 days management, re-entry "performing" or
switching to other states of loans.
The management of problem loans is manned in accordance with their level of risk: it is
charged to the organizational structures responsible for the management of the performing
loans of the Bank with regard to "due and / or past on a continuous basis," the
"substandard" and "restructured loans" for the positions to "suffering", management is in
charge of the Service Area for Macro Doubtful Loans and Credit Recovery of the parent
company from which you have completed the process of centralizing management.
The assessment of the value adjustments is analytically, for each position, ensuring
adequate coverage of expected losses.
The analysis of impaired loans is constantly made by the individual operating units that
patrol the risks and the parent company.
The resolution by the counterparts of the state of difficulty is the determining factor for the
return of positions "performing", the event is heavily concentrated in its relations with
"past due and / or past on a continuous basis" and those "substandard" .


176
Quantitative information

A. Credit Quality

A.1 and credit impaired loans: amounts, adjustments, changes, economic and territorial distribution

A.1.1 Distribution of credit exposures by portfolio and credit quality (value)



                                                                                                      Exhibitions       Exhibitions
                       Wallets / quality                        Doubtful            Substandard                                              Other activities        Total
                                                                                                      refurbished         Expired

1. Financial assets held for trading                                       72                 3.036           2.023                890                  94.931        100.952
2. Financial assets available for sale                                          -                 -                 -                    -                      -            -
3. Financial assets held to maturity                                            -                 -                 -                    -                      -            -
4. Loans to banks                                                          20                     -                 -                    -             851.371        851.391
5. Loans to customers                                              184.912                  318.668         201.499            41.021               14.332.104      15.078.204
6. Financial assets at fair value                                               -                 -                 -                    -                      -            -
7. Financial assets held for sale                                               -                 -                 -                    -                      -            -
8. Hedging derivatives                                                          -                 -                 -                    -              45.471          45.471
                                           Total   31/12/2010      185.004                  321.704        203.522             41.911              15.323.877       16.076.018
                                           Total   31/12/2009      132.779                  252.179         73.230             76.073              21.275.937       21.810.198




                                                                                                                                                                             177
A.1.2 Distribution of credit exposures by portfolio and credit quality (gross and net)

                                                                                                  Impaired assets                                                         Performing
                                                                                                                                                                                                                       Total
                      Wallets / Quality                                                           Corrections                                                             Adjustments
                                                                          Gross Exposure                                        Net Exposure        Gross Exposure                               Net Exposure       (Net exposure)
                                                                                                        specific                                                           Portfolio
1. Financial assets held for trading                                                6.609                       (588)                   6.021             X                    X                       94.931              100.952
2. Financial assets available for sale                                                     -                           -                       -                      -                      -                  -                    -
3. Financial assets held to maturity                                                       -                           -                       -                      -                      -                  -                    -
4. Loans to banks                                                                      22                            (2)                    20                851.371                        -        851.371              851.391
5. Loans to customers                                                            955.261                   (209.161)                 746.100             14.399.556                (67.452)        14.332.104          15.078.204
6. Financial assets at fair value                                                          -                           -                       -          X                    X                                -                    -
7. Financial assets held for sale                                                          -                           -                       -                      -                      -                  -                    -
8. Hedging derivatives                                                                     -                           -                       -          X                    X                       45.471               45.471
                                          Total     31/12/2010                   961.892                  (209.751)                  752.141            15.250.927                 (67.452)        15.323.877          16.076.018

                                          Total     31/12/2009                   710.021                  (175.760)                  534.261            21.139.161                 (50.364)        21.275.937          21.810.198



As required by the Bank of Italy roneata letter of 16 February 2011, provides the details for the portfolio of "performing loans" distinguishing
between exposures subject to renegotiation, and other exposures, with an analysis of seniority expired.


                                                                                                                   Performing                                                 Total
                          Wallets / Quality
                                                                                                             Portfolio adjustments                                         (Net exposure)
                                                                                Gross Exposure                                                     Net Exposure
Financial assets held for trading:                                                                                                                        94.931                    94.931
 Other exposures                                                                                                                                          94.931                       94.931
                                                  0 to 90 days past due                                                                                   94.757                       94.757
                                              90 to 180 days past due                                                                                          174                       174
Due from banks:                                                                            851.371                                      -                851.371                   851.371
 Other exposures                                                                           851.371                                      -                851.371                   851.371
                                                  0 to 90 days past due                    851.371                                                       851.371                   851.371
Loans to customers:                                                                  14.399.556                                 (67.452)              14.332.104              14.332.104
 Exposures subject to renegotiation                                                        196.873                                  (864)                196.009                   196.009
                                                  0 to 90 days past due                    195.389                                  (836)                194.553                   194.553
                                              90 to 180 days past due                           1.484                                (29)                     1.456                     1.456
 Other exposures                                                                      14.202.683                                 (66.587)              14.136.096              14.136.096
                                                  0 to 90 days past due               14.174.820                                 (64.930)              14.109.890              14.109.890
                                              90 to 180 days past due                          27.864                             (1.658)                 26.206                       26.206
Cash flow hedges:                                                                                                                                         45.471                    45.471
 Other exposures                                                                                                                                          45.471                       45.471
                                                  0 to 90 days past due                                                                                   45.471                       45.471
                                                    Total 31/12/2010                 15.250.927                                 (67.452)              15.323.877              15.323.877




178
A.1.3            On-balance and off-balance credit exposure to banks: gross and
net


                                                                    Exposure,          Value adjustments,                 Value adjustments,                 Exposure,
                   Type of exposure / values
                                                                    Gross                    specific                          Portfolio                       Net

A. On-balance sheet Exposure to

    a) Bad debts                                                                22                                  (2)               X                                  20
     b) Substandard                                                                -                                  -               X                                   -
     c) Restructured                                                               -                                  -               X                                   -
     d) Expired exposures                                                          -                                  -               X                                   -
     e) Other assets                                                     851.372                     X                                           -                851.372

                                                          Total A       851.394                                     (2)                          -               851.392
B. Off-balance sheet exposure
     a) Impaired                                                                  -                                   -               X                                   -
     b)
     Other                                                             1.946.851                     X                                      (133)               1.946.718

                                                          Total B     1.946.851                                       -                     (133)              1.946.718
                                                      Total A + B     2.798.245                                     (2)                     (133)              2.798.110




A.1.4 On-balance credit exposures to banks: changes in gross impaired loans


                                                                                                                                          Restructured         Expired
                                     Causal / categories                                  Doubtful               Substandard


A. Gross value                                                                                           2                        -                      -                  -
   - Of which: exposures trensferred not cancelled                                                           -                    -                      -                  -
B. Increases                                                                                                 -                    -                      -                  -
     B.1 inflows from performing loans                                                                       -                    -                      -                  -
     B.2 transfers from other categories of impaired                                                         -                    -                      -                  -
     B.3 other increases                                                                                     -                    -                      -                  -
C. Decreases                                                                                                 -                    -                      -                  -
      C.1 outflows to performing loans                                                                       -                    -                      -                  -
      C.2 canceled                                                                                           -                    -                      -                  -
      C.3 collections                                                                                        -                    -                      -                  -
      C.4 disposals                                                                                          -                    -                      -                  -
      C.5 transfers to other categories of impaired                                                          -                    -                      -                  -
      C.6 Other decreases                                                                                    -                    -                      -                  -
D. Gross exposure, final                                                                                 2                        -                      -                  -
   - Of which: transferred byt not cancelled                                                                 -                    -                      -                  -




                                                                                                                                                                         179
A.1.5 Credit exposures to banks: changes in total adjustments

                                                                                                                                        Exhibitions       Exhibitions
                                      Causal / Categories                                 Doubtful             Substandard
                                                                                                                                           Restored         Expired

A. Total initial adjustments                                                                         (2)                        -                     -                    -
      - Of which: exposures transferred not cancelled                                                      -                    -                     -                    -
B. Increases                                                                                               -                    -                     -                    -
      B.1 Value adjustments                                                                                -                    -                     -                    -
      B.2 transfers from other categories of impaired                                                      -                    -                     -                    -
      B.3 other increases                                                                                  -                    -                     -                    -
C. Decreases                                                                                               -                    -                     -                    -
       C.1 backs from assessment                                                                           -                    -                     -                    -
       C.2 Built-backs                                                                                     -                    -                     -                    -
       C.3 write-offs                                                                                      -                    -                     -                    -
       C.4 transfers to other categories of impaired                                                       -                    -                     -                    -
       C.5 Other decreases                                                                                 -                    -                     -                    -
D. Total adjustments                                                                                 (2)                        -                     -                    -
      - Of which: exposures sold not derecognised                                                          -                    -                     -                    -




A.1.6 Credit exposures to off-balance sheet and cash to customers: gross and net


                                                                          Exposure          Value adjustments                Adjustments to               Exposure
                        Type of exposure / values
                                                                          Gross                   specific                      Portfolio                   net


A. Exposure to cash
      a) Bad debts                                                              346.898                        (161.931)            X                            184.967
      b) Substandard                                                            351.197                         (32.529)            X                            318.668
      c) Restructured                                                           214.801                         (13.302)            X                            201.499
      d) Expired                                                                 42.421                           (1.400)           X                             41.021
      e) Other assets                                                        14.426.220                    X                              (67.452)           14.358.768

                                                                Total A     15.381.537                         (209.162)                 (67.452)           15.104.923
B. Off-balance sheet exposure
    a) Impaired                                                                  58.994                           (2.129)           X                             56.865
    b) Other                                                                  2.327.592                    X                               (2.905)             2.324.687

                                                                Total B      2.386.586                           (2.129)                   (2.905)            2.381.552
                                                            Total A + B     17.768.123                         (211.291)                 (70.357)           17.486.475




180
A.1.7 On-balance credit exposures due from customers: changes in gross impaired loans


                                                                                                                  Restructured       Expired
                                   Causal / Categories                Doubtful           Substandard

                                                                                                                          81.134               77.447
A. Initial gross exposure                                                  268.591                 280.583                 4.177                8.767
    - Of which transferred, not cancelled                                        5.022                  27.068
                                                                                                                        430.807           289.305
B. Increases                                                               159.187                 540.180
                                                                                                                          12.682           264.225
     B.1 inflows from performing credit exposures                            41.653                    282.825
                                                                                                                         153.816                9.187
     B.2 transfers from other categories of impaired exposures              112.259                    125.989
                                                                                                                         264.309               15.893
     B.3 Other increases                                                         5.275                 131.366
                                                                                                                       (297.140)         (324.331)
C. Decreases                                                               (80.880)               (469.566)
                                                                                                                          (5.752)         (177.422)
     C.1 performing credit                                                           -                 (44.396)
                                                                                                                                 -                   -
     C.2 canceled                                                           (52.358)                          -
                                                                                                                        (238.196)              (2.452)
     C.3 collections                                                        (25.911)                   (53.372)
                                                                                                                                 -                   -
     C.4 disposals                                                                   -                        -
                                                                                                                         (16.171)         (121.717)
     C.5 transfers to other categories of impaired                                   -             (263.365)
                                                                                                                         (37.021)          (22.740)
     C.6 Other decreases                                                     (2.611)               (108.433)
                                                                                                                        214.801                42.421
D. Gross value                                                             346.898                 351.197
                                                                                                                          15.131                9.468
    - Of which transferred but not cancelled                                 16.694                     55.101




                                                                                                                                                         181
A.1.8 Credit exposures due from customers for: changes in total adjustments


                                                                                                                   Exhibitions         Exhibitions
                                      Causal / Categories                Doubtful          Substandard
                                                                                                                   refurbished           Expired


A. Initial total adjustments                                                  (136.315)             (29.794)               (8.210)             (1.439)
      - Of which: exposures sold not derecognised                                (1.453)                 (1.315)                   -                  (78)
B. Increases                                                                   (91.421)             (29.297)               (9.076)             (1.554)
B.1 Value adjustments                                                          (72.451)              (19.349)              (4.287)              (1.098)
B.2 transfers from other categories of impaired                                (13.752)                    (706)           (3.879)                    (26)
B.3 other increases                                                              (5.218)                 (9.242)             (910)                   (430)
C. Decreases                                                                    65.805               26.562                 3.984               1.593
C.1 backs from assessment                                                         4.880                   1.170                  174                  304
C.2 Built-backs                                                                   6.194                   4.116                  735                  265
C.3 write-offs                                                                  52.358                         -                   -                     -
C.4 transfers to other categories of impaired                                        19                  17.315                  136                  892
C.5 Other decreases                                                               2.354                   3.961             2.939                     132
D. Total adjustments                                                          (161.931)             (32.529)             (13.302)              (1.400)
      - Of which: exposures sold not derecognised                                (2.897)                 (3.125)             (658)                   (146)




182
A.2 Classification of exposures based on external and internal ratings

A.2.1       Distribution of credit exposure in cash and off-balance for the rating classes outside


                                                                                Classes of external ratings
                    Exhibitions                                                                                                                              No rating         Total
                                            Class 1           Class 2             Class 3               Class 4          Class 5           Class 6


A. Credit exposure in cash                      101.312         1.299.376                6.188                542.905       923.042           889.977        12.193.516       15.956.316
B. Derivatives                                        -            14.215                     -                 10.072         8.515             4.857            82.044          119.703
    B.1 Financial derivatives                         -             14.215                    -                 10.072             8.515             4.857        82.044          119.703
    B.2 Credit derivatives                            -                     -                 -                      -                 -                 -                -                 -
C. Guarantees given                              26.558           334.651              56.763                   35.304        34.533            33.950        2.533.607         3.055.366
D. Commitments to disburse funds                      -            45.435                     -                 28.637        74.544          104.352           900.232         1.153.200

                                   Total        127.870         1.693.677              62.951                 616.918     1.040.634         1.033.136        15.709.399       20.284.585




                                                                                  Classes of external ratings
                    Exhibitions                                                                                                                               Class 9         Total
                                            Class 1           Class 2             Class 3                Class 4         Class 5            Class 6

in securitized mortgages                                  -        169.441                      -             110.775        164.325           121.749           740.122         1.306.412




                                                                                                                                                                                       183
A.2.2                      Distribution of balance sheet exposures and off-balance sheet for internal rating classes


                                                                                                                                       Internal rating classes

                 Exhibitions                                                                                                                                                                                                                                                         No rating      Total

                                       Rating 1       Rating 2       Rating 3        Rating 4        Rating 5        Rating 6        Rating 7             Rating 8        Rating 9           Rating 10        Rating 11        Rating 12        Rating 13        Rating 14


A. Balanc     e sheet exposures        207.995         256.725       1.448.338       1.299.078         889.330 3.696.439              244.832            2.383.032        838.650             852.606 1.060.455                110.722          411.142          179.000         2.077.975        15.956.316
B.
Derivatives                                 956             563          3.428            2.214          1.037          12.904            1.040                   4.936     13.367               2.963               9.770             280             1.344        1.151            63.751          119.703
  B.1 Financial derivatives                 956             563          3.428            2.214          1.037          12.904            1.040                   4.936     13.367               2.963               9.770             280             1.344        1.151            63.751          119.703

  B.2 Credit derivatives                          -              -               -               -               -               -                 -                  -              -                   -                -                -                -                -               -               -

C. Guarantees given                      42.220         22.490        203.759           82.065         211.376        233.258             5.935                  61.706     94.045              21.834          25.962                1.152            7.546        5.715        2.036.305         3.055.366

D. Commitments to disburse funds         11.366           9.454         43.904          59.799          26.516        214.397           33.500                   91.581     12.924              41.034        127.015                 1.217            2.605       12.460          465.427         1.153.200
Total                                  262.537        289.233        1.699.429       1.443.155       1.128.259       4.156.998        285.307            2.541.255        958.985            918.436 1.223.201                 113.371          422.637          198.326 4.643.457                20.284.586




                                                                                                                                       Internal rating classes

                 Exhibitions                                                                                                                                                                                                                                                     No rating        Total

                                       Rating 1       Rating 2       Rating 3        Rating 4        Rating 5        Rating 6        Rating 7             Rating 8        Rating 9       Rating 10       Rating 11        Rating 12        Rating 13        Rating 14


in securitized mortgages                29.708          47.052        119.052          144.374          92.479        213.689          43.408             211.860          86.264         85.221             83.781           14.105           13.396           44.684           77.339          1.306.412




Scale Master classes corresponding to consist of intervals of PD (Probability of Default) in which the PDs are mapped to different point of internal rating
different classes are related to valued models. This representation guarantees the comparability of different exposures internal rating models.
counterparts

The five classes of scale teacher less risky have a concentration equal to 29.6% of total balance sheet exposures with internal rating, while only 4.3% is
concentrated in the two classes most risk. Class 6 and Class 8 are the largest in terms of exposure.

The class contains the unrated impaired.




184
A.3 Distribution of exposures guaranteed by type of security

A.3.1 Credit exposures to banks


                                                                                                                                                                                                                                                                            Guarantees (2)

                                                                                                                    Collateral (1)

                                                                                                                                                                                                                       Credit derivatives                                                                                                    Credit commitments
                                                               Value
                                                                                                                                                                                                                                                                                                                                                                                                                   Total (1) + (2)
                                                           net exposure
                                                                                                                                                                                                                                            Other derivatives
                                                                                                                                                                                                                                                                                                 Governments and banks       Other government                                            Other
                                                                                         Real Estate                     Titles                     Other collateral             CLN                                                                                                                                                                              Banks
                                                                                                                                                                                           Governments and banks       Other government                                         Other                       Central                 Public                                              subjects
                                                                                                                                                                                                                                                                Banks
                                                                                                                                                                                                     Central                  Public                                           subjects

1. On-balance guaranteed Credit exposure

 1.1. completely secured                                                            -                           -                               -                            -         -                           -                                -                   -                    -                           -                                -                         -                        -                             -
         - Of which impaired                                                        -                           -                               -                            -         -                           -                                -                   -                    -                           -                                -                         -                        -                             -
 1.2. partially secured                                                   508.723                               -                     507.401                                -         -                           -                                -                   -                    -                           -                                -                         -                        -                507.401

         - Of which impaired                                                        -                           -                               -                            -         -                           -                                -                   -                    -                           -                                -                         -                        -                             -
2. Off-balance guaranteed Credit exposure

 2.1. completely secured                                                            -                           -                               -                            -         -                           -                                -                   -                    -                           -                                -                         -                        -                             -
         - Of which impaired                                                        -                           -                               -                            -         -                           -                                -                   -                    -                           -                                -                         -                        -                             -
 2.2. partially secured                                                             -                           -                               -                            -         -                           -                                -                   -                    -                           -                                -                         -                        -                             -
         - Of which impaired                                                        -                           -                               -                            -         -                           -                                -                   -                    -                           -                                -                         -                        -                             -




A.3.2                                             Credit exposure to customers guaranteed


                                                                                                                                                                                                                                                                            Guarantees (2)

                                                                                                                    Collateral (1)

                                                                                                                                                                                                                       Credit derivatives                                                                                            Credit commitments
                                                               Value
                                                                                                                                                                                                                                                                                                                                                                                                                 Total (1) + (2)
                                                           net exposure

                                                                                                                                                                                                                                            Other
                                                                                                                                                                                                                                            derivatives
                                                                                                                                                                                                                                                                                                 Governments and banks       Other government                                            Other
                                                                                        Real Estate                      Titles                     Other collateral             CLN                                                                                                                                                                              Banks
                                                                                                                                                                                           Governments and banks       Other government                                         Other                       Central                 Public                                              subjects

                                                                                                                                                                                                                                                                Banks
                                                                                                                                                                                                      Central                 Public                                           subjects


1. On-balance credit exposure


 1.1. completely secured                                            9.733.957                   7.558.355                            299.389                     3.154                 -                           -                                -                   -                    -                           -                      16.738                    11.121              1.598.743                  9.487.500

         - Of which impaired                                              505.938                     344.348                         14.005                           101             -                           -                                -                   -                    -                           -                               -                     37                  139.781                  498.272

 1.2. partially secured                                                   532.540                       6.859                         77.036                     2.895                 -                           -                                -                   -                    -                           -                       2.218                     2.109                   208.015                  299.132

         - Of which impaired                                               22.809                          334                         1.557                     2.063                 -                           -                                -                   -                    -                           -                               -                   204                    11.299                    15.457

2. Credit exposure off balance sheet guarantees

 2.1. completely secured                                               884.950                    362.113                             31.960                      4.695                -                           -                                -                   -                    -                           -                          160                      184                   329.693                  728.805

         - Of which impaired                                               21.244                       9.453                             590                          258             -                           -                                -                   -                    -                           -                                -                    39                    2.985                    13.325

 2.2. partially secured                                                137.394                            103                           9.253                  16.741                  -                           -                                -                   -                    -                           -                                -               28.553                    10.880                    65.530

         - Of which impaired                                                3.305                           65                             34                                -         -                           -                                -                   -                    -                           -                                -                        -                 1.170                         1.269




                                                                                                                                                                                                                                                                                                                                                                                                                 185
B. DISTRIBUTION AND CONCENTRATION OF CREDIT EXPOSURE
B.1 Sectoral distribution of on-balance and off-balance credit exposures to customers (value)
                                                          Governm                                                             Other public                                                                     Financial
                                                          ents                                                                agencies                                                                         corporations                                                       Insurance                                                         Non-financial companies                                           Others




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                                                                                                                                                                                                                                                                                                                           i
A. On Balance sheet exposures
A.1 Doubtful                                       55                                -        X                                      -                            -           X                             3.236               (1.968)                   X                            -                        -         X                         142.693         (111.541)             X                   38.983              (48.421)              X
A.2 Substandard                                      1                 (1)                    X                                      -                            -           X                             1.408                 (135)                   X                            -                        -         X                         237.153          (25.410)             X                   80.106               (6.984)              X
A.3 Restructured                                      -                              -        X                                      -                            -           X                            11.832                 (342)                   X                            -                        -         X                         189.667          (12.960)             X                                -                    -       X
A.4 Expired                                           -                              -        X                                      -                            -           X                                       9                   (2)             X                            -                        -         X                          29.887           (1.042)             X                   11.125                   (356)            X
A.5 Other                                     27.273         X                                                      -    37.405            X                                                     (1)   885.013                  X                         (1.485)                  1.294         X                                    (4)      9.107.722              X                  (53.025)         4.300.061                 X                  (12.937)
Total A                                       27.329                   (1)                                          -   37.405                                    -                              (1)   901.498                  (2.447)                   (1.485)                  1.294                        -                     (4)     9.707.122         (150.953)                (53.025)         4.430.275               (55.761)             (12.937)
B. off-balance
exposure
B.1 Non-performing loans                              -                              -        X                                      -                            -           X                                  12                             -         X                            -                        -         X                           3.566             (303)             X                            50                      (1)      X
B.2 Substandard                                       -                              -        X                                      -                            -           X                                399                    (21)                X                            -                        -         X                          18.054             (344)             X                       489                     (12)          X
B.3 Other impaired assets                             -                              -        X                                      -                            -           X                                       -                         -         X                            -                        -         X                          34.290           (1.446)             X                                5                   (1)      X
B.4 Other exposures                           15.796         X                                                      -   346.761            X                                                     (2)    78.128                   X                               (40)                80          X                                    (1)      1.759.437               X                  (2.497)           124.485                 X                        (365)
Total B                                       15.796                                 -                              -   346.761                                   -                              (2)   78.539                        (21)                     (40)                   80                         -                     (1)     1.815.347               (2.093)             (2.497)          125.029                       (14)               (365)
                 Total (A + B)   31/12/2010   43.125                   (1)                                          -   384.166                                   -                              (3)   980.037                  (2.468)                   (1.525)                  1.374                        -                     (5) 11.522.469            (153.046)                (55.522)         4.555.304               (55.775)             (13.302)
                 Total (A + B)   31/12/2009   46.566                   (1)                                          -   381.537                                   -                              (3)   911.462                  (1.167)                   (1.359)                  1.708                        -                     (5) 10.983.001            (122.889)                (38.422)         4.198.174               (53.318)             (12.862)




186
B.2 Breakdown of on-balance and off-balance credit exposure to customers (value)
                                                                                            OTHER EUROPEAN
                                                              ITALY                               COUNTRIES                               AMERICA                                          ASIA                             REST OF WORLD

         Exposure / Regions
                                                                                                                                                                                                        Value
                                                                Value adjustments                        Value adjustments                          Value adjustments                             adjustments                          Value adjustments
                                               Net exposure                           Net exposure                               Net exposure                               Net exposure                            Net exposure
                                                                           Total                                   Total                                      Total                                    Total                                      Total

A. Balance sheet exposures
A.1 Doubtful                                        184.816              (161.814)               96                    (110)                55                        (7)                  -                    -                  -                          -
A.2 Substandard                                     318.287                (32.499)             377                     (29)                    4                       -                  -                    -                  -                          -
A.3 Restructured                                    201.499                (13.302)                  -                       -                  -                       -                  -                    -                  -                          -
A.4 Expired                                           41.021                (1.400)                  -                       -                  -                       -                  -                    -                  -                          -
A.5 Other                                        14.251.591                (66.833)        101.035                     (599)             4.476                        (7)             359                   (1)              1.307                         (11)
TOTAL                                           14.997.214               (275.848)         101.508                     (738)            4.535                      (14)               359                   (1)             1.307                          (11)
B. Exhibitions off-balance
B.1 Non-performing loans                               3.628                  (305)                  -                       -                  -                       -                  -                    -                  -                          -
B.2 Substandard                                       18.942                  (377)                  -                       -                  -                       -                  -                    -                  -                          -
B.3 Other impaired assets                             34.295                (1.447)                  -                       -                  -                       -                  -                    -                  -                          -
B.4 Other exposures                               2.324.256                 (2.901)                  3                       -                  -                       -                  -                    -              428                          (4)
TOTAL B                                           2.381.121                (5.030)                   3                       -                  -                       -                  -                    -             428                           (4)
                    Total (A + B) 31/12/2010    17.378.335               (280.878)         101.511                     (738)            4.535                      (14)               359                   (1)             1.735                          (15)
                    Total (A + B) 31/12/2009    16.451.147               (199.489)          65.258                     (432)            5.022                      (88)               378                   (1)               641                          (15)




                                                                                                                                                                                                                                                            187
B.3 Distribution of credit exposure in cash and off-balance to banks (value)

                                                                           ITALY                       OTHER EUROPEAN COUNTRIES                                 AMERICA                                          ASIA                                REST OF WORLD

               Exhibitions / Regions
                                                                               Value adjustments                              Value adjustments                           Value adjustments                          Value adjustments                          Value adjustments
                                                            Net exposure                                   Net exposure                               Net exposure                                Net exposure                               Net exposure
                                                                                          Total                                          Total                                  Total                                           Total                                      Total


A. Balance sheet exposures
A.1 Doubtful                                                           20                      (2)                        -                       -                   -                       -                  -                       -                  -                       -
A.2 Substandard                                                            -                       -                      -                       -                   -                       -                  -                       -                  -                       -
A.3 Restructured                                                           -                       -                      -                       -                   -                       -                  -                       -                  -                       -
A.4 Expired exposures                                                      -                       -                      -                       -                   -                       -                  -                       -                  -                       -
A.5 Other exposures                                              815.258                           -              23.781                          -                  15                       -          12.163                          -             155                          -
TOTAL                                                            815.278                      (2)                23.781                           -                  15                       -         12.163                           -             155                          -
B. Exhibitions off-balance
B.1 Non-performing loans                                                   -                       -                      -                       -                   -                       -                  -                       -                  -                       -
B.2 Substandard                                                            -                       -                      -                       -                   -                       -                  -                       -                  -                       -
B.3 Other impaired assets                                                  -                       -                      -                       -                   -                       -                  -                       -                  -                       -
B.4 Other exposures                                            1.899.904                           -              16.013                    (33)                     24                       -          23.464                    (75)              7.313                    (25)
TOTAL B                                                        1.899.904                           -             16.013                     (33)                     24                       -         23.464                     (75)              7.313                    (25)
                               Total (A + B)   31/12/2010      2.715.182                      (2)                39.794                     (33)                     39                       -         35.627                     (75)              7.468                    (25)
                               Total (A + B)   31/12/2009      8.982.287                      (2)               164.470                           -             557                           -           2.007                          -           3.340                          -




188
B.4 Large exposures

                                                                  Total
                                                              31/12/2010

Number of positions                                                              8

Exposure                                                             5.248.622
Risk position                                                        1.560.765




Since the report refers to 31.12.2010 are defined as "large risks" shows nominal amount
equal to or greater than 10% of regulatory capital.
Individual banks belonging to banking groups are subject to an individual limit of 40% of its
Capital. This limit is referred to the "risk position" or the exposure weighted according to the
rules laid down by law.




                                                                                                   189
C. Securitisation and asset disposals

C.1 Securitisation
In the first half of 2009 was made a securitization by transfer to a vehicle company called
UBI Finance 2 Srl loans to small and medium enterprises, classified performing.
By virtue of the integral repurchase by the Originator of all liabilities issued by the SPV, this
is not the subject of detection in this section of the Notes. For reference, we report below,
however, some indication of the issue, the portfolio and the role of the Banco di Brescia in
the transaction.

The main characteristics of the securities UBI Finance 2, issued on February 27, 2009:
        Shares of Class A (Senior Tranches): 1,559,500,000.00 rated floating rate with a
        maximum rating from Fitch, and these securities were made available by the Bank of
        UBI Banco di Brescia, via repurchase Time to use them as collateral in repo
        transactions with the ECB or guarantee intraday transactions with the Bank of Italy.
        Securities Class B (Junior Tranches): 519,850,000.00 rated and unrated return
        equal to 'additional return operation, allowing the originator to take advantage of
        Brescia Tour 'excess spread of the underlying portfolios.

During the first quarter of 2011, in order to meet the new requirements for the eligibility of
securitized in transactions with the ECB, was the request to the agency Moody's assignment
of a second title at the Class A rating, the rating assigned is equal to
Aaa. At the moment so the Senior Tranche enjoys the highest rating that Fitch is from
Moody's.

Under the securitization program, the Parent UBI Bank has assumed the role of Italian
Bank Account, Calculation Agent and the Servicer and has delegated to the Banco di
Brescia, as sub-servicer, The task of collection and management of securitized reports
(excluding reports in the past suffering, which are borne from the credits of the Parent) for
such activities that the Bank receives a fee for the year 2010, amounts to € 616 thousand,
compared to total collections for about 387 million euro.



Sales of C.2
There were no disposals.



C.3 covered bonds
Objectives
In 2008, the Management Board of UBI Bank has decided to proceed with the
implementation of a program of issuing bonds structured, aimed at the benefit in terms of
funding together to contain the cost of collection.

In particular, the Management Board:
        identified the objectives of the program;
        identified the basic structure of an operation of issuing bonds to the legislation,
        "hollowing out and examining the main elements, including the initial portfolio of
        loans and the same selection criteria as well as the financial structure of the
        operation and testing;

190
        evaluated and approved the impacts and the necessary adjustments related to
        organizational, computer and accounting. These adjustments have been made to
        ensure the proper risk management also on individual member banks. In the
        preparation of the procedures was also taken into account the requirements of
        regulations issued by the Bank of Italy;
        considered the risks associated with the operation of issuing bonds;
        assessed the organizational structure and management of the company vehicle in
        order to verify that the transaction contract documents contain clauses to ensure a
        smooth and efficient performance of its functions by the same company vehicle;
        assessed the legal profiles, through a detailed examination of structures and
        contractual arrangements that are used, with particular attention to the
        characteristics of the guarantee provided by the vehicle and the whole of the
        relationship between the issuing bank, the banks and the ceding company vehicle.


The structure
The basic structure of the operation of issuing bonds are expected to be implemented the
following activities:
        A bank (the bank transferor) transfers a set of asset having certain characteristics to
        a vehicle, forming a segregated assets (cover pool);
        The same bank transferor (here as the lending bank) provides the vehicle a
        subordinated loan in order to finance the payment of the purchase price of asset by
        the vehicle;
        The bank (issuing bank) issue bonds backed by a guarantee primary, unconditional
        and irrevocable emitted from the vehicle for the sole benefit of investors and holders
        of bonds of the counterparties hedging involved in the transaction. The guarantee is
        supported by all asset transferred to the vehicle and are part of the cover pool.

The structure that was adopted also provides that the portfolio assets in separate special
purpose vehicle to be sold by most banks originator (Banks originators) other than the
issuing bank.


Adjusting its organizational structure and control procedures
In the process of organizational analysis was carried out to identify four major processes
which have been assigned the main activities related to the scheme and in particular:
   1.   Detection of the liquidity needs of the operation and approval by the competent
        bodies . The macro-process that provides the grounds for issuing bonds are evaluated
        within the finance committee and approved by UBI Bank in their guidelines by the
        Board of Management. Subsequently, information is given to the banks involved
        network, on the basis of information received by the parent, consider proposed issue
        and adhesion. In this context, it is identified The Arranger that will cure this, and
        activate the internal structures involved.
   2.   Planning and preparation of the operation        . This process involves macro- The
        extraction criteria are verified and validated the asset part of the portfolio backing
        the issue, interfacing with the rating agencies and companies
        review, carried out the preparatory activities for the proper segregation of the
        portfolio and the sale of the vehicle and prepared all the contracts for the operation
        of indoor and outdoor facilities to the bank.
   3.   Operation Manager       : The macro-process expected to be open accounts current
        functional operation of the vehicle, provided the subordinated loan, derivative
        contracts entered into between the network banks and special purpose vehicles,
        given the Cascade payments"Carried out test effectiveness of the portfolio, the shares
        of the identified

                                                                                                  191
          loans for the restoration of the portfolio as collateral for bonds, these activities are
          carried out on an ongoing basis.
      4. Checks required by legislation       : The macro-process involves the allocation of internal
          and external controls under the laws in particular for analysis and monitoring
          requirements to ensure the quality and integrity of the transferred assets as a
          guarantee of the portfolio, define test efficacy and produce these report Synthesis,
          verify compliance with the limits for a transfer of eligible assets, check the coverage
          of financial risks, check for compliance by the transferee company of its obligations
          under the guarantee, check the patterns and contractual structures adopted to
          verify the completeness of checks to be made by the parent company. External
          controls are also prepared to certify the conformity of accounting policies used by the
          bank to those which it must follow in preparing the financial statements and ensure
          the regularity of the integrity of the guarantee issued by the repayment of bonds
          guaranteed.


The program covered bonds UBI Banca from € 10 billion
Under the model described above, the UBI Banca Group has begun a program of emissions
by ten billion bonds in July 2008 making the first sales of loans from two banks of the
Group, Banco di Brescia, Banca Regionale Europea per 2 billion €.
More specifically, the structure adopted by program covered bonds of UBI Bank is as
follows:

was set up a special purpose vehicle, UBI Finance Ltd. that as the guarantor of the
emissions made by UBI Bank has acquired a portfolio of residential mortgage loans sold by
banks in the Group's network participating in the program both as originator bank, which
as Lending Banks.

The role of the Master Servicer, the Calculation Agent and the Cash Manager of the
operation is carried out by the parent company, while the Paying Agent is done by Bank of
New York (Luxembourg) SA, the representative of the bondholders and BNY Corporate
Trustee Services Limited.
 UBI Banca was then delegated to the originator bank, acting as sub-servicer, the activities
of servicing related to the management of collections and customer relations for the portfolio
sold by each Originator; donor banks also play the role of counterparties in swap guarantee
balance swap entered into with the SPV in order to normalize the cash flows generated by
the mortgage portfolio.

During the month of September 2009, with the assistance of Barclays Capital as
ArrangerThe Bank has released the first public issue of covered bonds, a billion euro.

At the end of 2009 he joined the program also Banca Popolare di Bergamo, yielding a
proportion of its mortgage portfolio, an amount equal to approx. € 1.3 billion, serving the
second public issue, again for a billion euro, created in December 2009.

The following are the characteristics of two issues:

                                                Date           Date                              Coupo
               Title                          emission        expiry      Nominal value          n


 UBI BANCA two CB 3.625% 23/09/2016          23/09/2009    23/09/2016     1.000.000.000,00 36.250.000,00

 UBI BANCA two CB 4.000% 16/12/2019          16/12/2009    16/12/2019     1.000.000.000,00 40.000.000,00


Both issues have been rated AAA / Aaa by Fitch and Moody's.

192
On 04/30/2010, following the signing between the EIB - European Investment Bank and
UBI a framework agreement for the provision of medium / long-term holdings, was made a
separate issue, private , fully subscribed by the EIB.

These are the characteristics of the emission EIB


                                                   Date             Date             Value
               Title                                                                                  Coupon (*)
                                                 emission          expiry           Nominal

   UBI BANCA two TV CB 30/04/2022              30/04/2010      30/04/2022       250.000.000,00       2.271.200,00

(*) the semi-annual coupon rate is variable, the amount mentioned relates to the coupon expires in early May
    2011.


In May 2010 joined the Covered Bond Program's also the Banco di San Giorgio and Banca
Popolare di Ancona, disposing of its assets in the third transfer operation, which involved
also the originator bank already participating in the program, including Banco di Brescia.
With this transaction, on May 1, 2010, assets were sold for a total of € 2.7 billion, of which
approx. € 675 million related to loans sold by Banco di Brescia.

Subsequently, on 15.09.2010 was made a fourth issue, the public, for a further one billion,
to whom we report the following characteristics:


UBI BANK 3.375% 15/09/2017 15/09/2010 09/15/2017 CB two 1,000,000,000.00 33,750,000.00


Although this issue has been rated AAA / Aaa by Fitch and Moody's.

During the last quarter of 2010 was completed to join the program by the banks network,
thanks to the sale of its portfolios of mortgage loans by Banca Popolare Commerce and
Industry, Carime Bank, Bank of Vallecamonica and UBI Banca Private took place on 1
October, for a total of 2.4 billion.

Also in October, has also been made for further public issue
500 million, five-year, which are below the main features:


UBI BANCA two CB 3.125% 18/10/2015            18/10/2010       18/10/2015            500.000.000        15.625.000


Although this issue has received the highest rating from Fitch and Moody's.

As of December 31, 2010, therefore, are part of the Banco di Brescia, Banca Regionale
Europea, Banca Popolare di Bergamo, Banca Popolare di Ancona, Banco di San Giorgio,
Banca Popolare Commercio and Industry, Carime Bank, and Bank of Vallecamonica UBI
Banca Private.

The overall portfolio to ensure emissions accounting that has been entered in the assets of
each bank's transferor to 31/12/2010 amounted to over € 7.7 billion of outstanding debt
capital, of which approx. 1.8 billion originated by Banco di Brescia.

During the year 2010, the portfolio attributable to the Banco di Brescia generated total
collections for approx. 487 million €.

For the activity of subservicing Originator banks receive a fee, the extent of the managed
portfolio and the duration of the servicing, such a reward to the Banco di Brescia amounts
for the year 2010 to approx. 700 000 €.

                                                                                                                   193
Required in computerized information for completeness, we note that in the months of
January and February 2011 were made two public issues of covered bonds, for a total of
1.75 billion euro, of which we give the following characteristics:

                                             Date           Date           Value            Coupo
            Title                          emission        expiry         Nominal           n


 UBI BANCA two CB 5.250% 28/01/2021      28/01/2011   28/01/2021 1.000.000.000,00        52.500.000,00

 UBI BANCA two CB 4.500% 22/02/2016      22/02/2011   22/02/2016     750.000.000,00      33.750.000,00


Even these first two issues of 2011 have received the award of the maximum rating from
Fitch and Moody's.




194
D. MODELS FOR THE MEASUREMENT OF CREDIT RISK

With regard to the measurement of credit risk The Group has developed a model of UBI
Portfolio Credit Risk through the calculation engine PCRE Algorithmics: it treats the overall
risk of a portfolio model and capturing the component resulting from the correlation of
default of counterparties, calculating credit losses and capital to credit risk at the portfolio
level. The model numbers, between the various inputs, the variables of PD and LGD used
for supervisory purposes.



Section 2 Market risks

2.1 Interest rate risk and price risk - trading portfolio supervision

Qualitative information

A. General

The compilation of this section shall consider only the securities covered by the "trading
book capital" as defined in the rules governing regulatory reporting market risk.
Accordingly, any operations are not allocated in the budget in the trading but did not fall o
in the definition of supervision. These operations are included in the information concerning
the "banking".



B. Management processes and methods for measuring interest rate risk and price risk

See the next paragraph A. "General, management procedures and methods for measuring
interest rate risk."




                                                                                                   195
Quantitative information
1.1 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and financial
derivatives - Euro Currency

                                                                                         more than 3 more than 6                 more than 1
                                                                                                 months             months                   year          over 5 years
                   Type / Remaining         Overnight           Up to 3 months                                                                                                    Over 10 years
                                                                                          6 months            up to 1 year        up to 5 years             up to 10 years                            indefinite


1. Balance sheet assets                                     -                        -            26.486                     -                         1                      -              112                   -
1.1 Debt                                                -                            -            26.486                     -                         1                     -                112                  -
      - With early redemption option                    -                            -                  -                    -                         -                     -                    -                -
      - Other                                           -                            -            26.486                     -                         1                     -                112                  -
1.2 Other assets                                        -                            -                  -                    -                         -                     -                    -                -
2. Balance-sheet liabilities                                -                        -                  -                    -                         -                      -                   -                -
2.1 P.C.T. passive                                      -                            -                  -                    -                         -                     -                    -                -
2.2 Other liabilities                                   -                            -                  -                    -                         -                     -                    -                -
3. Financial derivatives                                    -         (1.932.948)                 49.962            78.076                508.941                   508.475              784.315               (1)
3.1 With underlying securities                          -                            -               (50)                    -                         -                     -                    -            (1)
- Options                                               -                            -               (50)                    -                         -                     -                    -            (1)
      - Long positions                                  -                  96.673                 58.644            26.836                     2.718                         -                    -                -
      - Short Positions                                 -                  96.673                 58.694            26.836                     2.718                         -                    -                1
- Other derivatives                                     -                            -                  -                    -                         -                     -                    -                -
      - Long positions                                  -                            -                  -                    -                         -                     -                    -                -
      - Short Positions                                 -                            -                  -                    -                         -                     -                    -                -
3.2 Without underlying securities                       -              (1.932.948)                50.012            78.076                 508.941                  508.475              784.315                   -
- Options                                               -                            -                  -                    -                         -                     -                    -                -
      - Long positions                                  -                 581.260                415.612           141.325                 425.453                  139.332                28.145                  -
      - Short Positions                                 -                 581.260                415.612           141.325                 425.453                  139.332                28.145                  -
- Other derivatives                                     -              (1.932.948)                50.012            78.076                 508.941                  508.475              784.315                   -
      - Long positions                                  -               2.429.297                922.510           261.896               1.023.720                1.688.507              817.356                   -
      - Short Positions                                 -               4.362.245                872.498           183.820                 514.779                1.180.032                33.041                  -




196
1.2 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency USD

                                                                                     For more than 3 more than 6 more than 1
                                                                                               months             months                 year over 5 years
                        Type / Remaining     Overnight       Up to 3 months                                                                                      Over 10 years
                                                                                     up to 6 months         up to 1 year     up to 5 years up to 10 years                            indefinite


1. Balance sheet assets                                  -                       -                       -                   -                  -            -                   -                -
1.1 Debt                                                 -                      -                        -                   -                  -            -                   -                -
     - With early redemption option                      -                      -                        -                   -                  -            -                   -                -
     - Other                                             -                      -                        -                   -                  -            -                   -                -
1.2 Other assets                                         -                      -                        -                   -                  -            -                   -                -
2. Balance-sheet liabilities                             -                       -                       -                   -                  -            -                   -                -
2.1 P.C.T. passive                                       -                      -                        -                   -                  -            -                   -                -
2.2 Other liabilities                                    -                      -                        -                   -                  -            -                   -                -
3. Financial derivatives                                 -              2.843                       52                       -                  -            -                   -                -
3.1 With underlying securities                           -                      -                   52                       -                  -            -                   -                -
- Options                                                -                      -                   52                       -                  -            -                   -                -
     - Long positions                                    -             90.752                   59.587              21.813              1.593                -                   -                -
     - Short Positions                                   -             90.752                   59.535              21.813              1.593                -                   -                -
- Other derivatives                                      -                      -                        -                   -                  -            -                   -                -
     - Long positions                                    -                      -                        -                   -                  -            -                   -                -
     - Short Positions                                   -                      -                        -                   -                  -            -                   -                -
3.2 Without underlying securities                        -               2.843                           -                   -                  -            -                   -                -
- Options                                                -                      -                        -                   -                  -            -                   -                -
     - Long positions                                    -               3.534                136.980                        -        134.710                -                   -                -
     - Short Positions                                   -               3.534                136.980                        -        134.710                -                   -                -
- Other derivatives                                      -               2.843                           -                   -                  -            -                   -                -
     - Long positions                                    -             55.049                 141.414               23.751            117.565                -                   -                -
     - Short Positions                                   -             52.206                 141.414               23.751            117.565                -                   -                -




                                                                                                                                                                                        197
1.3 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency CHF

                                                                                  more than 3 more than 6 more than 1
                                                                                            months            months                    year over 5 years
                        Type / Remaining     Overnight       Up to 3 months                                                                                     Over 10 years
                                                                                  up to 6 months        up to 1 year        up to 5 years up to 10 years                            indefinite


1. Balance sheet assets                                  -                    -                    -                    -                   -               -                   -                -
1.1 Debt                                                 -                    -                    -                    -                   -               -                   -                -
      - With early redemption option                     -                    -                    -                    -                   -               -                   -                -
      - Other                                            -                    -                    -                    -                   -               -                   -                -
1.2 Other assets                                         -                    -                    -                    -                   -               -                   -                -
2. Balance-sheet liabilities                             -                    -                    -                    -                   -               -                   -                -
2.1 P.C.T. passive                                       -                    -                    -                    -                   -               -                   -                -
2.2 Other liabilities                                    -                    -                    -                    -                   -               -                   -                -
3. Financial derivatives                                 -                    -                    -                    -                   -               -                   -                -
3.1 With underlying securities                           -                    -                    -                    -                   -               -                   -                -
- Options                                                -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                776                      -                    -                   -               -                   -                -
      - Short Positions                                  -                776                      -                    -                   -               -                   -                -
- Other derivatives                                      -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                    -                    -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                    -                    -                   -               -                   -                -
3.2 Without underlying securities                        -                    -                    -                    -                   -               -                   -                -
- Options                                                -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                    -                    -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                    -                    -                   -               -                   -                -
- Other derivatives                                      -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                560                      -                    -                   -               -                   -                -
      - Short Positions                                  -                560                      -                    -                   -               -                   -                -




198
1.4 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency GBP

                                                                                     more than 3 more than 6 more than 1
                                                                                               months            months                    year over 5 years
                        Type / Remaining     Overnight       Up to 3 months                                                                                        Over 10 years
                                                                                     up to 6 months        up to 1 year        up to 5 years up to 10 years                            indefinite


1. Balance sheet assets                                  -                       -                       -                 -                   -               -                   -                -
1.1 Debt                                                 -                    -                      -                     -                   -               -                   -                -
     - With early redemption option                      -                    -                      -                     -                   -               -                   -                -
     - Other                                             -                    -                      -                     -                   -               -                   -                -
1.2 Other assets                                         -                    -                      -                     -                   -               -                   -                -
2. Balance-sheet liabilities                             -                       -                       -                 -                   -               -                   -                -
2.1 P.C.T. passive                                       -                    -                      -                     -                   -               -                   -                -
2.2 Other liabilities                                    -                    -                      -                     -                   -               -                   -                -
3. Financial derivatives                                 -                       -                       -                 -                   -               -                   -                -
3.1 With underlying securities                           -                    -                      -                     -                   -               -                   -                -
- Options                                                -                    -                      -                     -                   -               -                   -                -
     - Long positions                                    -               1.699                       -             1.366                       -               -                   -                -
     - Short Positions                                   -               1.699                       -             1.366                       -               -                   -                -
- Other derivatives                                      -                    -                      -                     -                   -               -                   -                -
     - Long positions                                    -                    -                      -                     -                   -               -                   -                -
     - Short Positions                                   -                    -                      -                     -                   -               -                   -                -
3.2 Without underlying securities                        -                    -                      -                     -                   -               -                   -                -
- Options                                                -                    -                      -                     -                   -               -                   -                -
     - Long positions                                    -                    -                    232                     -                   -               -                   -                -
     - Short Positions                                   -                    -                    232                     -                   -               -                   -                -
- Other derivatives                                      -                    -                      -                     -                   -               -                   -                -
     - Long positions                                    -               3.107                   1.931                     -                   -               -                   -                -
     - Short Positions                                   -               3.107                   1.931                     -                   -               -                   -                -




                                                                                                                                                                                          199
1.5 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency JPY

                                                                                     more than 3 more than 6 more than 1
                                                                                               months            months                    year over 5 years
                        Type / Remaining     Overnight       Up to 3 months                                                                                        Over 10 years
                                                                                     up to 6 months        up to 1 year        up to 5 years up to 10 years                            indefinite


1. Balance sheet assets                                  -                       -                    -                    -                   -               -                   -                -
1.1 Debt                                                 -                    -                       -                    -                   -               -                   -                -
      - With early redemption option                     -                    -                       -                    -                   -               -                   -                -
      - Other                                            -                    -                       -                    -                   -               -                   -                -
1.2 Other assets                                         -                    -                       -                    -                   -               -                   -                -
2. Balance-sheet liabilities                             -                       -                    -                    -                   -               -                   -                -
2.1 P.C.T. passive                                       -                    -                       -                    -                   -               -                   -                -
2.2 Other liabilities                                    -                    -                       -                    -                   -               -                   -                -
3. Financial derivatives                                 -                233                         -                    -                   -               -                   -                -
3.1 With underlying securities                           -                    -                       -                    -                   -               -                   -                -
- Options                                                -                    -                       -                    -                   -               -                   -                -
      - Long positions                                   -                    -                       -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                       -                    -                   -               -                   -                -
- Other derivatives                                      -                    -                       -                    -                   -               -                   -                -
      - Long positions                                   -                    -                       -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                       -                    -                   -               -                   -                -
3.2 Without underlying securities                        -                233                         -                    -                   -               -                   -                -
- Options                                                -                    -                       -                    -                   -               -                   -                -
      - Long positions                                   -                    -                       -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                       -                    -                   -               -                   -                -
- Other derivatives                                      -                233                         -                    -                   -               -                   -                -
      - Long positions                                   -               1.981                        -                    -                   -               -                   -                -
      - Short Positions                                  -               1.748                        -                    -                   -               -                   -                -




200
1.6 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency NOK

                                                                                  more than 3 more than 6 more than 1
                                                                                            months            months                    year over 5 years
                        Type / Remaining     Overnight       Up to 3 months                                                                                     Over 10 years
                                                                                  up to 6 months        up to 1 year        up to 5 years up to 10 years                            indefinite


1. Balance sheet assets                                  -                    -                    -                    -                   -               -                   -                -
1.1 Debt                                                 -                    -                    -                    -                   -               -                   -                -
     - With early redemption option                      -                    -                    -                    -                   -               -                   -                -
     - Other                                             -                    -                    -                    -                   -               -                   -                -
1.2 Other assets                                         -                    -                    -                    -                   -               -                   -                -
2. Balance-sheet liabilities                             -                    -                    -                    -                   -               -                   -                -
2.1 P.C.T. passive                                       -                    -                    -                    -                   -               -                   -                -
2.2 Other liabilities                                    -                    -                    -                    -                   -               -                   -                -
3. Financial derivatives                                 -                    -                    -                    -                   -               -                   -                -
3.1 With underlying securities                           -                    -                    -                    -                   -               -                   -                -
- Options                                                -                    -                    -                    -                   -               -                   -                -
     - Long positions                                    -                    -                    -                    -                   -               -                   -                -
     - Short Positions                                   -                    -                    -                    -                   -               -                   -                -
- Other derivatives                                      -                    -                    -                    -                   -               -                   -                -
     - Long positions                                    -                    -                    -                    -                   -               -                   -                -
     - Short Positions                                   -                    -                    -                    -                   -               -                   -                -
3.2 Without underlying securities                        -                    -                    -                    -                   -               -                   -                -
- Options                                                -                    -                    -                    -                   -               -                   -                -
     - Long positions                                    -                    -                    -                    -                   -               -                   -                -
     - Short Positions                                   -                    -                    -                    -                   -               -                   -                -
- Other derivatives                                      -                    -                    -                    -                   -               -                   -                -
     - Long positions                                    -                    2                    -                    -                   -               -                   -                -
     - Short Positions                                   -                    2                    -                    -                   -               -                   -                -




                                                                                                                                                                                       201
1.7 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency PLN


                                                                                  more than 3 more than 6 more than 1
                                                                                            months             months                   year over 5 years
                        Type / Remaining     Overnight       Up to 3 months                                                                                     Over 10 years
                                                                                  up to 6 months        up to 1 year        up to 5 years up to 10 years                            indefinite



1. Balance sheet assets                                  -                    -                    -                    -                   -               -                   -                -
1.1 Debt                                                 -                    -                    -                    -                   -               -                   -                -
      - With early redemption option                     -                    -                    -                    -                   -               -                   -                -
      - Other                                            -                    -                    -                    -                   -               -                   -                -
1.2 Other assets                                         -                    -                    -                    -                   -               -                   -                -
2. Balance-sheet liabilities                             -                    -                    -                    -                   -               -                   -                -
2.1 P.C.T. passive                                       -                    -                    -                    -                   -               -                   -                -
2.2 Other liabilities                                    -                    -                    -                    -                   -               -                   -                -
3. Financial derivatives                                 -                    -                    -                    -                   -               -                   -                -
3.1 With underlying securities                           -                    -                    -                    -                   -               -                   -                -
- Options                                                -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                    -                    -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                    -                    -                   -               -                   -                -
- Other derivatives                                      -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                    -                    -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                    -                    -                   -               -                   -                -
3.2 Without underlying securities                        -                    -                    -                    -                   -               -                   -                -
- Options                                                -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                    -                    -                    -                   -               -                   -                -
      - Short Positions                                  -                    -                    -                    -                   -               -                   -                -
- Other derivatives                                      -                    -                    -                    -                   -               -                   -                -
      - Long positions                                   -                629                      -                    -                   -               -                   -                -
      - Short Positions                                  -                629                      -                    -                   -               -                   -                -




202
1.8 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency CAD



                                                                            more than 3 more than 6 more than 1                     over 5
                                                              Up to 3
                                                                                     months     months         year                      years
                   Type / Remaining        Overnight          months                                                                                 Over 10 years       indefinite
                                                                                    up to 6
                                                                                   months up to 1 year up to 5 years           up to 10 years



1. Balance sheet assets                                -                -                  -              -                -                     -                   -                -
1.1 Debt                                               -                -                  -              -                -                     -                   -                -
    - With early redemption option                     -                -                  -              -                -                     -                   -                -
    - Other                                            -                -                  -              -                -                     -                   -                -
1.2 Other assets                                       -                -                  -              -                -                     -                   -                -
2. Balance-sheet liabilities                           -                -                  -              -                -                     -                   -                -
2.1 P.C.T. passive                                     -                -                  -              -                -                     -                   -                -
2.2 Other liabilities                                  -                -                  -              -                -                     -                   -                -
3. Financial derivatives                               -                -                  -              -                -                     -                   -                -
3.1 With underlying securities                         -                -                  -              -                -                     -                   -                -
- Options                                              -                -                  -              -                -                     -                   -                -
    - Long positions                                   -         3.686                     -          3.788            1.080                     -                   -                -
    - Short Positions                                  -         3.686                     -          3.788            1.080                     -                   -                -
- Other derivatives                                    -                -                  -              -                -                     -                   -                -
    - Long positions                                   -                -                  -              -                -                     -                   -                -
    - Short Positions                                  -                -                  -              -                -                     -                   -                -
3.2 Without underlying securities                      -                -                  -              -                -                     -                   -                -
- Options                                              -                -                  -              -                -                     -                   -                -
    - Long positions                                   -                -                  -              -                -                     -                   -                -
    - Short Positions                                  -                -                  -              -                -                     -                   -                -
- Other derivatives                                    -                -                  -              -                -                     -                   -                -
    - Long positions                                   -                -                  -              -                -                     -                   -                -
    - Short Positions                                  -                -                  -              -                -                     -                   -                -




                                                                                                                                                                                  203
1.9 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency SEK


                                                                             more than 3 more than 6 more than 1                over 5
                                                               Up to 3
                                                                                      months     months         year                 years
                     Type / Remaining       Overnight          months                                                                            Over 10 years       indefinite
                                                                                     up to 6
                                                                                    months up to 1 year up to 5 years       up to 10 years


1. Balance sheet assets                                 -                -                 -                -           -                    -                   -                -
1.1 Debt                                                -                -                 -                -           -                    -                   -                -
      - With early redemption option                    -                -                 -                -           -                    -                   -                -
      - Other                                           -                -                 -                -           -                    -                   -                -
1.2 Other assets                                        -                -                 -                -           -                    -                   -                -
2. Balance-sheet liabilities                            -                -                 -                -           -                    -                   -                -
2.1 P.C.T. passive                                      -                -                 -                -           -                    -                   -                -
2.2 Other liabilities                                   -                -                 -                -           -                    -                   -                -
3. Financial derivatives                                -                -                 -                -           -                    -                   -                -
3.1 With underlying securities                          -                -                 -                -           -                    -                   -                -
- Options                                               -                -                 -                -           -                    -                   -                -
      - Long positions                                  -           571                    -                -           -                    -                   -                -
      - Short Positions                                 -           571                    -                -           -                    -                   -                -
- Other derivatives                                     -                -                 -                -           -                    -                   -                -
      - Long positions                                  -                -                 -                -           -                    -                   -                -
      - Short Positions                                 -                -                 -                -           -                    -                   -                -
3.2 Without underlying securities                       -                -                 -                -           -                    -                   -                -
- Options                                               -                -                 -                -           -                    -                   -                -
      - Long positions                                  -                -                 -                -           -                    -                   -                -
      - Short Positions                                 -                -                 -                -           -                    -                   -                -
- Other derivatives                                     -                -                 -                -           -                    -                   -                -
      - Long positions                                  -           279                   50                -           -                    -                   -                -
      - Short Positions                                 -           279                   50                -           -                    -                   -                -




204
1.10 Regulatory trading portfolio: distribution by maturity (the date of repricing) of assets and liabilities for cash and derivatives -
Currency OTHER CURRENCIES

                                                                                   more than 3 more than 6 more than 1
                                                                                             months            months                    year over 5 years
                        Type / Remaining     Overnight       Up to 3 months                                                                                      Over 10 years
                                                                                   up to 6 months        up to 1 year        up to 5 years up to 10 years                            indefinite


1. Balance sheet assets                                  -                     -                    -                    -                   -               -                   -                -
1.1 Debt                                                 -                     -                    -                    -                   -               -                   -                -
     - With early redemption option                      -                     -                    -                    -                   -               -                   -                -
     - Other                                             -                     -                    -                    -                   -               -                   -                -
1.2 Other assets                                         -                     -                    -                    -                   -               -                   -                -
2. Balance-sheet liabilities                             -                     -                    -                    -                   -               -                   -                -
2.1 P.C.T. passive                                       -                     -                    -                    -                   -               -                   -                -
2.2 Other liabilities                                    -                     -                    -                    -                   -               -                   -                -
3. Financial derivatives                                 -                     -                    -                    -                   -               -                   -                -
3.1 With underlying securities                           -                     -                    -                    -                   -               -                   -                -
- Options                                                -                     -                    -                    -                   -               -                   -                -
     - Long positions                                    -                     -                    -                    -                   -               -                   -                -
     - Short Positions                                   -                     -                    -                    -                   -               -                   -                -
- Other derivatives                                      -                     -                    -                    -                   -               -                   -                -
     - Long positions                                    -                     -                    -                    -                   -               -                   -                -
     - Short Positions                                   -                     -                    -                    -                   -               -                   -                -
3.2 Without underlying securities                        -                     -                    -                    -                   -               -                   -                -
- Options                                                -                     -                    -                    -                   -               -                   -                -
     - Long positions                                    -                     -                 488                     -                   -               -                   -                -
     - Short Positions                                   -                     -                 488                     -                   -               -                   -                -
- Other derivatives                                      -                     -                    -                    -                   -               -                   -                -
     - Long positions                                    -                    33                    -                    -                   -               -                   -                -
     - Short Positions                                   -                    33                    -                    -                   -               -                   -                -




                                                                                                                                                                                        205
3. Regulatory trading portfolio: internal models and other methods of sensitivity
    analysis

The trading of supervision of the Banco di Brescia consists mainly of government bonds
(CCT). Please note that at the end of December, the VaR of the trading portfolio amounted to
about € 20,515 with a NAV of around 26.55 million euro (average VaR in 2010 to € 9511).




206
2.2 Interest rate risk and price - Banking
The banking book consists of all financial assets and liabilities not included in the trading of
Section 2.1.

Qualitative information

A. General, management procedures and methods for measuring interest rate risk and
   price risk

The risk of interest rate is defined as the current or prospective risk of a change in net
interest income and economic value of the Bank, due to unexpected changes in interest
rates that affect the banking book.
The measurement, monitoring and reporting of exposure to interest rate risk are made from
the Risk Management of the Parent Company, which supplies on a monthly basis:
    ·    perform sensitivity analysis of the economic value (fair value risk) for the
         measurement of the change in asset values in parallel shock scenarios of the yield
         curve of reference;
    ·    to carry through an analysis of static gap (that is, assuming that the positions are
         constant during the period), an analysis of the sensitivity of net interest income
         (Cash flow risk), which focuses on changes in income over a period of twelve months
         measured in parallel shock scenarios of yield curve
         Reference
The sensitivity analysis of the economic value includes an estimate of the impacts arising
from the phenomenon of early repayment of mortgages and loans, regardless of the presence
of early repayment options defined in the contract.
The estimate of variation margin includes both an estimate of reinvestment / refinancing
flows due to the effect related to the elasticity and viscosity of sight items. The factors of
elasticity and the delay in contract rates are differentiated by business segment
classification score.


B. Hedging fair value

During the year 2010 have been put in place specific and generic coverage through
derivative financial instruments to reduce exposure to adverse changes in fair value (fair
value hedge) due to interest rate risk.
In particular, have been the subject of coverage:
        fixed-rate loans to more than one year (hedging) for about
        € 140 million total votes;
        Prefix loans (hedging) for about 65 million euro in total;
        bonds (hedging) at a fixed rate for 500 million euro in the denomination.

Derivatives used are of the Interest Rate Swap and ZIP code.
The optimization process has resulted in land for the Banco di Brescia, in January, the sale
to other banks in the group of covered employees for about € 70 million acquisition of loans
covered about 110 million euro.
The verification is carried out from the covers of the effectiveness of the Risk Management
Parent. In detail, the tests are carried out effectively in accordance with International
Accounting Standards by testing horizon for the cover, followed by back-testing performed
on a monthly basis.


C. Hedging of cash flows

In the financial statements of Banco di Brescia are the effects of reports of "cash flow hedge"
in relation to the emissions of Certificates of Deposit in Japanese currency (JPY) emissions
covered by the Domestic Currency Swap (DCS).


                                                                                                   207
Quantitative information
Banking 1.1 distribution for residual maturity (the date of repricing) of assets and liabilities - Currency EURO

                                                                           more than 3           more than 6          more than 1
                                                                                    months               months                  year       over 5 years
                 Type / Remaining   Overnight         Up to 3 months                                                                                               Over 10 years
                                                                           up to 6 months          up to 1 year        up to 5 years         up to 10 years                            indefinite



1.   Balance sheet assets                4.985.617           7.257.589            1.578.975              255.838              803.339                454.942              471.306                   -
1.1 Debt                                        38               7.433                       -                554                       -                      -                   -                -
     - With prepayment option                     -                    -                     -                    -                     -                      -                   -                -
     - Other                                    38               7.433                       -                554                       -                      -                   -                -
1.2 Loans to banks                          56.851             676.351                67.623                1.027                       -                     20                   -                -
1.3 Loans to customers                    4.928.728          6.573.805             1.511.352              254.257              803.339               454.922               471.306                  -
     -C/c                                 2.538.039                    -                     -                    -                     -              58.756                      -                -
     - Other funds                        2.390.689          6.573.805             1.511.352              254.257              803.339               396.166               471.306                  -
       - With prepayment option            593.515           5.718.527             1.391.961              244.531              786.991               269.740               466.863                  -
       - Other                            1.797.174            855.278               119.391                9.726               16.348               126.426                 4.443                  -
2.   Balance-sheet liabilities          10.203.353           2.811.564              476.020              422.372             1.328.702                22.889                       -                -
2.1 Due to customers                      8.231.597            462.657               56.075                 1.779                4.325                        26                   -                -
     -C/c                                 7.981.862                    -                     -                    -                     -                      -                   -                -
     - Other payables                      249.735             462.657               56.075                 1.779                4.325                        26                   -                -
       - With prepayment option                   -                    -                     -                    -                     -                      -                   -                -
       - Other                             249.735             462.657               56.075                 1.779                4.325                        26                   -                -
2.2 Due to banks                          1.950.542          1.357.359                       -                    -                     -                      -                   -                -
     -C/c                                 1.858.635                    -                     -                    -                     -                      -                   -                -
     - Other payables                       91.907           1.357.359                       -                    -                     -                      -                   -                -
2.3 Debt                                    21.214             991.548              419.945               420.593            1.324.377                 22.863                      -                -
     - With prepayment option                     -                    -                     -                    -                     -                      -                   -                -
     - Other                                21.214             991.548              419.945               420.593            1.324.377                 22.863                      -                -
2.4 Other liabilities                             -                    -                     -                    -                     -                      -                   -                -
     - With prepayment option                     -                    -                     -                    -                     -                      -                   -                -
     - Other                                      -                    -                     -                    -                     -                      -                   -                -
3.   Financial derivatives                        -          (104.514)             (654.012)             288.656             1.012.886              (198.403)            (359.551)                  -
3.1 With underlying securities                    -                    -                     -                    -                 22                         -                   -                -
     - Options                                    -                    -                     -                    -                 22                         -                   -                -
       + Long positions                           -                    -                     -                    -                 22                         -                   -                -
       + Short positions                          -                    -                     -                    -                     -                      -                   -                -
     - Other derivatives                          -                    -                     -                    -                     -                      -                   -                -
       + Long positions                           -                    -                     -                    -                     -                      -                   -                -
       + Short positions                          -                    -                     -                    -                     -                      -                   -                -
3.2 Without underlying securities                 -           (104.514)            (654.012)              288.656            1.012.864              (198.403)             (359.551)                 -
     - Options                                    -             (2.180)                      -            (26.180)                      -                      -            14.180                  -
       + Long positions                           -             (1.090)                      -            (13.090)                      -                      -            14.180                  -
       + Short positions                          -              1.090                       -             13.090                       -                      -                   -                -
     - Other derivatives                          -           (102.334)            (654.012)              314.836            1.012.864              (198.403)             (373.731)                 -
       + Long positions                           -          1.041.563              325.506               417.819            1.358.341                 25.996               10.470                  -
       + Short positions                          -          1.143.897              979.518               102.983              345.477               224.399               384.201                  -




208
Banking 1.2 distribution for residual maturity (the date of repricing) of assets and liabilities - Currency USD

                                                                                    more than 3           more than 6          more than 1
               Type / Remaining     Overnight               Up to 3 months                   months               months                  year        over 5 years           Over 10 years
                                                                                    up to 6 months          up to 1 year        up to 5 years           up to 10 years                           indefinite


1. Balance sheet assets                     51.587                    35.038                   1.675                  459                    62                          -                   -                -
1.1 Debt                                                -                       -                     -                    -                      -                      -                   -                -
     - With prepayment option                           -                       -                     -                    -                      -                      -                   -                -
     - Other                                            -                       -                     -                    -                      -                      -                   -                -
1.2 Loans to banks                          44.539                        165                    264                       -                      -                      -                   -                -
1.3 Loans to customers                          7.048                 34.873                    1.411                 459                    62                          -                   -                -
     -C/c                                         527                           -                     -                    -                      -                      -                   -                -
     - Other funds                              6.521                 34.873                    1.411                 459                    62                          -                   -                -
       - With prepayment option                         -                       -                     -                    -                      -                      -                   -                -
       - Other                                  6.521                 34.873                    1.411                 459                    62                          -                   -                -
2. Balance-sheet liabilities                67.650                    24.456                   1.190                  416                    52                          -                   -                -
2.1 Due to customers                        67.267                              -                     -                    -                 52                          -                   -                -
     -C/c                                   66.705                              -                     -                    -                 52                          -                   -                -
     - Other payables                             562                           -                     -                    -                      -                      -                   -                -
       - With prepayment option                         -                       -                     -                    -                      -                      -                   -                -
       - Other                                    562                           -                     -                    -                      -                      -                   -                -
2.2 Due to banks                                  383                 24.456                    1.190                 416                         -                      -                   -                -
     -C/c                                               1                       -                     -                    -                      -                      -                   -                -
     - Other payables                             382                 24.456                    1.190                 416                         -                      -                   -                -
2.3 Debt                                                -                       -                     -                    -                      -                      -                   -                -
     - With prepayment option                           -                       -                     -                    -                      -                      -                   -                -
     - Other                                            -                       -                     -                    -                      -                      -                   -                -
2.4 Other liabilities                                   -                       -                     -                    -                      -                      -                   -                -
     - With prepayment option                           -                       -                     -                    -                      -                      -                   -                -
     - Other                                            -                       -                     -                    -                      -                      -                   -                -
3. Financial derivatives                                -                       -                     -                    -                      -                      -                   -                -
3.1 With underlying securities                          -                       -                     -                    -                      -                      -                   -                -
     - Options                                          -                       -                     -                    -                      -                      -                   -                -
       + Long positions                                 -                       -                     -                    -                      -                      -                   -                -
       + Short positions                                -                       -                     -                    -                      -                      -                   -                -
     - Other                                            -                       -                     -                    -                      -                      -                   -                -
       + Long positions                                 -                       -                     -                    -                      -                      -                   -                -
       + Short positions                                -                       -                     -                    -                      -                      -                   -                -
3.2 Without underlying securities                       -                       -                     -                    -                      -                      -                   -                -
     - Options                                          -                       -                     -                    -                      -                      -                   -                -
       + Long positions                                 -                       -                     -                    -                      -                      -                   -                -
       + Short positions                                -                       -                     -                    -                      -                      -                   -                -
     - Other                                            -                       -                     -                    -                      -                      -                   -                -
       + Long positions                                 -                       -                     -                    -                      -                      -                   -                -
       + Short positions                                -                       -                     -                    -                      -                      -                   -                -




                                                                                                                                                                                                                  209
Banking 1.3 distribution for residual maturity (the date of repricing) of assets and liabilities - Currency CHF

                                                                                    more than 3            more than 6            more than 1
                                                                                             months                  months                   year       over 5 years                               indefinite
               Type / Remaining     Overnight                Up to 3 months                                                                                                     Over 10 years
                                                                                    up to 6 months            up to 1 year         up to 5 years           up to 10 years


1. Balance sheet assets                           478                   4.493                    183                          -                      -                      -                   -                -
1.1 Debt                                                 -                      -                      -                      -                      -                      -                   -                -
     - With prepayment option                            -                      -                      -                      -                      -                      -                   -                -
     - Other                                             -                      -                      -                      -                      -                      -                   -                -
1.2 Loans to banks                                403                           -                      -                      -                      -                      -                   -                -
1.3 Loans to customers                              75                  4.493                    183                          -                      -                      -                   -                -
     -C/c                                                -                      -                      -                      -                      -                      -                   -                -
     - Other funds                                  75                  4.493                    183                          -                      -                      -                   -                -
       - With prepayment option                          -                      -                      -                      -                      -                      -                   -                -
       - Other                                      75                  4.493                    183                          -                      -                      -                   -                -
2. Balance-sheet liabilities                    1.420                   3.999                          -                      -                      -                      -                   -                -
2.1 Due to customers                            1.418                           -                      -                      -                      -                      -                   -                -
     -C/c                                       1.416                           -                      -                      -                      -                      -                   -                -
     - Other payables                                    2                      -                      -                      -                      -                      -                   -                -
       - With prepayment option                          -                      -                      -                      -                      -                      -                   -                -
       - Other                                           2                      -                      -                      -                      -                      -                   -                -
2.2 Due to banks                                         2              3.999                          -                      -                      -                      -                   -                -
     -C/c                                                -                      -                      -                      -                      -                      -                   -                -
     - Other payables                                    2              3.999                          -                      -                      -                      -                   -                -
2.3 Debt                                                 -                      -                      -                      -                      -                      -                   -                -
     - With prepayment option                            -                      -                      -                      -                      -                      -                   -                -
     - Other                                             -                      -                      -                      -                      -                      -                   -                -
2.4 Other liabilities                                    -                      -                      -                      -                      -                      -                   -                -
     - With prepayment option                            -                      -                      -                      -                      -                      -                   -                -
     - Other                                             -                      -                      -                      -                      -                      -                   -                -
3. Financial derivatives                                 -                      -                      -                      -                      -                      -                   -                -
3.1 With underlying securities                           -                      -                      -                      -                      -                      -                   -                -
     - Options                                           -                      -                      -                      -                      -                      -                   -                -
       + Long positions                                  -                      -                      -                      -                      -                      -                   -                -
       + Short positions                                 -                      -                      -                      -                      -                      -                   -                -
     - Other                                             -                      -                      -                      -                      -                      -                   -                -
       + Long positions                                  -                      -                      -                      -                      -                      -                   -                -
       + Short positions                                 -                      -                      -                      -                      -                      -                   -                -
3.2 Without underlying securities                        -                      -                      -                      -                      -                      -                   -                -
     - Options                                           -                      -                      -                      -                      -                      -                   -                -
       + Long positions                                  -                      -                      -                      -                      -                      -                   -                -
       + Short positions                                 -                      -                      -                      -                      -                      -                   -                -
     - Other                                             -                      -                      -                      -                      -                      -                   -                -
       + Long positions                                  -                      -                      -                      -                      -                      -                   -                -
       + Short positions                                 -                      -                      -                      -                      -                      -                   -                -




210
Banking 1.4 distribution for residual maturity (the date of repricing) of assets and liabilities - Currency GBP

                                                                                    more than 3           more than 6           more than 1
               Type / Remaining     Overnight                Up to 3 months                  months                months                   year       over 5 years           Over 10 years
                                                                                    up to 6 months          up to 1 year         up to 5 years           up to 10 years                           indefinite


1. Balance sheet assets                         1.698                     316                         -                     -                      -                      -                   -                -
1.1 Debt                                                 -                      -                     -                     -                      -                      -                   -                -
     - With prepayment option                            -                      -                     -                     -                      -                      -                   -                -
     - Other                                             -                      -                     -                     -                      -                      -                   -                -
1.2 Loans to banks                              1.204                           -                     -                     -                      -                      -                   -                -
1.3 Loans to customers                            494                     316                         -                     -                      -                      -                   -                -
     -C/c                                         494                           -                     -                     -                      -                      -                   -                -
     - Other funds                                       -                316                         -                     -                      -                      -                   -                -
       - With prepayment option                          -                      -                     -                     -                      -                      -                   -                -
       - Other                                           -                316                         -                     -                      -                      -                   -                -
2. Balance-sheet liabilities                    2.289                           -                     -                     -                      -                      -                   -                -
2.1 Due to customers                            2.289                           -                     -                     -                      -                      -                   -                -
     -C/c                                       2.279                           -                     -                     -                      -                      -                   -                -
     - Other payables                               10                          -                     -                     -                      -                      -                   -                -
       - With prepayment option                          -                      -                     -                     -                      -                      -                   -                -
       - Other                                      10                          -                     -                     -                      -                      -                   -                -
2.2 Due to banks                                         -                      -                     -                     -                      -                      -                   -                -
     -C/c                                                -                      -                     -                     -                      -                      -                   -                -
     - Other payables                                    -                      -                     -                     -                      -                      -                   -                -
2.3 Debt                                                 -                      -                     -                     -                      -                      -                   -                -
     - With prepayment option                            -                      -                     -                     -                      -                      -                   -                -
     - Other                                             -                      -                     -                     -                      -                      -                   -                -
2.4 Other liabilities                                    -                      -                     -                     -                      -                      -                   -                -
     - With prepayment option                            -                      -                     -                     -                      -                      -                   -                -
     - Other                                             -                      -                     -                     -                      -                      -                   -                -
3. Financial derivatives                                 -                      -                     -                     -                      -                      -                   -                -
3.1 With underlying securities                           -                      -                     -                     -                      -                      -                   -                -
     - Options                                           -                      -                     -                     -                      -                      -                   -                -
       + Long positions                                  -                      -                     -                     -                      -                      -                   -                -
       + Short positions                                 -                      -                     -                     -                      -                      -                   -                -
     - Other                                             -                      -                     -                     -                      -                      -                   -                -
       + Long positions                                  -                      -                     -                     -                      -                      -                   -                -
       + Short positions                                 -                      -                     -                     -                      -                      -                   -                -
3.2 Without underlying securities                        -                      -                     -                     -                      -                      -                   -                -
     - Options                                           -                      -                     -                     -                      -                      -                   -                -
       + Long positions                                  -                      -                     -                     -                      -                      -                   -                -
       + Short positions                                 -                      -                     -                     -                      -                      -                   -                -
     - Other                                             -                      -                     -                     -                      -                      -                   -                -
       + Long positions                                  -                      -                     -                     -                      -                      -                   -                -
       + Short positions                                 -                      -                     -                     -                      -                      -                   -                -




                                                                                                                                                                                                                   211
Banking 1.5 distribution for residual maturity (the date of repricing) of assets and liabilities - Currency OTHER CURRENCIES

                                                                               more than 3           more than 6          more than 1
                                                                                        months               months                  year       over 5 years
                 Type / Remaining   Overnight           Up to 3 months                                                                                                Over 10 years
                                                                               up to 6 months          up to 1 year        up to 5 years         up to 10 years                           indefinite


1.   Balance sheet assets                       1.005               4.655                   380                       -                     -                     -                   -                -
1.1 Debt                                            -                      -                     -                    -                     -                     -                   -                -
     - With prepayment option                       -                      -                     -                    -                     -                     -                   -                -
     - Other                                        -                      -                     -                    -                     -                     -                   -                -
1.2 Loans to banks                               993                1.923                        -                    -                     -                     -                   -                -
1.3 Loans to customers                            12                2.732                   380                       -                     -                     -                   -                -
     -C/c                                           -                      -                     -                    -                     -                     -                   -                -
     - Other funds                                12                2.732                   380                       -                     -                     -                   -                -
      - With prepayment option                      -                      -                     -                    -                     -                     -                   -                -
      - Other                                     12                2.732                   380                       -                     -                     -                   -                -
2.   Balance-sheet liabilities                  1.332               5.313                   552                       -                     -                     -                   -                -
2.1 Due to customers                             927                       -                     -                    -                     -                     -                   -                -
     -C/c                                        927                       -                     -                    -                     -                     -                   -                -
     - Other payables                               -                      -                     -                    -                     -                     -                   -                -
      - With prepayment option                      -                      -                     -                    -                     -                     -                   -                -
      - Other                                       -                      -                     -                    -                     -                     -                   -                -
2.2 Due to banks                                 344                2.319                   552                       -                     -                     -                   -                -
     -C/c                                        343                       -                     -                    -                     -                     -                   -                -
     - Other payables                              1                2.319                   552                       -                     -                     -                   -                -
2.3 Debt                                          61                2.994                        -                    -                     -                     -                   -                -
     - With prepayment option                       -                      -                     -                    -                     -                     -                   -                -
     - Other                                      61                2.994                        -                    -                     -                     -                   -                -
2.4 Other liabilities                               -                      -                     -                    -                     -                     -                   -                -
     - With prepayment option                       -                      -                     -                    -                     -                     -                   -                -
     - Other                                        -                      -                     -                    -                     -                     -                   -                -
3.   Financial derivatives                          -                790                         -                    -                     -                     -                   -                -
3.1 With underlying securities                      -                      -                     -                    -                     -                     -                   -                -
     - Options                                      -                      -                     -                    -                     -                     -                   -                -
      + Long positions                              -                      -                     -                    -                     -                     -                   -                -
      + Short positions                             -                      -                     -                    -                     -                     -                   -                -
     - Other                                        -                      -                     -                    -                     -                     -                   -                -
      + Long positions                              -                      -                     -                    -                     -                     -                   -                -
      + Short positions                             -                      -                     -                    -                     -                     -                   -                -
3.2 Without underlying securities                   -                    790                     -                    -                     -                     -                   -                -
     - Options                                      -                      -                     -                    -                     -                     -                   -                -
      + Long positions                              -                      -                     -                    -                     -                     -                   -                -
      + Short positions                             -                      -                     -                    -                     -                     -                   -                -
     - Other                                        -                    790                     -                    -                     -                     -                   -                -
      + Long positions                            50                2.802                        -                    -                     -                     -                   -                -
      + Short positions                           50                2.012                        -                    -                     -                     -                   -                -




212
2. Bank portfolio: internal models and other methods for sensitivity analysis

The exposure to interest rate risk of the Banco di Brescia, measured by the sensitivity
analysis in a scenario of parallel shift of the yield curve equal to +100 bp, stood at period
end, resulting from the gross of the related phenomenon to lapses, to -30.56 million (EUR -
35.91 million euro at December 31, 2009). The measure of risk, the net impact of the
phenomenon on prepayments, amounted to -11.39 million (EUR -12.69 million euro at
December 31, 2009), 0.78% Heritage Supervisory Board, in response to the threshold -
defined by the Policy Group for the financial risks of Banco di Brescia on this indicator - 1%
of regulatory capital. The exhibition includes approximately € -0.20 million related to
interest rate swaps firm commitment on bond issues still in employment at December 31,
2010 excluded from the calculations. Excluding this contribution, the exposure to interest
rate risk, it would stand to -11.19 million euro, 0.77% of regulatory capital.
The table below shows the risk measures identified in the periods cited in a scenario of
parallel variation of the reference rate equal to +200 bp, consistent with the requirements of
prudential regulation, related to the regulatory capital at period end.


                       Risk indicators - annual average                 Year 2010           Year 2009


parallel shift of +200 bp
sensitivity / regulatory capital                                          1.4%              1.6%




                       Risk indicators - point values                    31/12/2010       31/12/2009


parallel shift of +200 bp
sensitivity / regulatory capital                                          1.3%              1.6%




At December 31, 2010, the impact on net interest income, assuming the yield curve shift of
the reference to +100 basis point is equal to +37.79 million euro, while in case of reduced
rate of (- 100 bp) the impact on net interest income is estimated at EUR -54.00 million.
These levels of exposure include the effect on the viscosity of sight items (both in terms of
elasticity of the transfer rate variations from the reference rates to domestic rates, which in
terms of delay of implementation of the changes themselves).
The following is the profile of capital for repricing date of input to the internal model to
calculate exposure to interest rate risk.




                                                                                                        213
Within the main component of the banking book is classified as Category IAS and Loans
Receivable, composed mainly of municipal bonds.
Background information indicates that at the end of December, the total VaR of the portfolio
of the bank Banco di Brescia was about 912 € (284 € to June 30, 2010) with a NAV equal to
around EUR 8.13 million (8.54 million euro at June 30, 2010).




214
2.3 Foreign exchange risk

Currency risk is the risk of incurring losses due to adverse changes in the rates of foreign
exchange on all positions held by the bank regardless of the portfolio allocation.


Qualitative information

A. General, management processes and methods for measuring exchange rate risk

As part of the analysis carried out from the ALM Risk Management of the Parent, the
exposure to exchange rate risk is determined by the methodology proposed by Italy and the
Bank is quantified in 8% of the "net open position in foreign exchange" where it is less than
2 percent of the capital.
The "net open position in foreign exchange" is determined:
    1.the net position in each currency and gold;
    2.converting the net positions in euro on the basis of the exchange rate or price for gold;
    3.adding, separately, all net long positions and all net short positions;

The higher of the total net long positions and the total net short positions is the "net open
position in foreign exchange."




B. Hedging foreign exchange risk

Operations in foreign exchange markets is carried out by Group Treasury operates through
instruments such as forward exchange transactions, forex swaps, currency swaps and
options in domestic changes, optimizing the risk profile arising from positions in the
currency of the Group.




                                                                                                  215
Quantitative information

The exposure to currency risk, as determined by the methodology described above, is void
as of December 31, 2010.


1. Distribution by currency denomination of assets and liabilities and derivatives


                                                                          Currencies


                    Voices
                                                        POUND          DOLLAR           YEN               FRANCO             OTHER
                                  U.S. DOLLAR
                                                                                                                          CURRENCIE
                                                      ENGLISH         CANADIAN         JAPANESE             SWISS                     S


A. Financial assets                    88.819             2.014             311            2.843              5.155              2.886
A.1 Debt                                          -               -                -               -                  -                   -
A.2 Equities                                      -               -                -               -                  -                   -
A.3 Loans to banks                      44.968            1.204                    -             52             403              2.863
A.4 Loans to customers                  43.851              810              311              2.791           4.752                   23
A.5 Other financial assets                        -               -                -               -                  -                   -
B. Other activities                        451              272                 18               15             233                   38
C. Financial liabilities               93.764             2.289             330            3.898              5.419              2.978
C.1 Due to banks                        26.445                    -          311              2.873           4.001                   32
C.2 Deposits from customers             67.319            2.289                 19                3           1.418                906
C.3 Debt                                          -               -                -          1.022                   -          2.040
C.4 Other financial liabilities                   -               -                -               -                  -                   -
D. Other liabilities                              -               -                -                  -               -                   -
E. Financial derivatives                 2.895                    -                -       1.023                      -                   -
E.1 Options                                  52                   -                -               -                  -                   -
  E.1.1 Long Positions                 179.548            3.297            8.555                   -            776                488
  E.1.2 Short positions                179.496            3.297            8.555                   -            776                488
E.1 Other derivatives                    2.843                    -                -          1.023                   -                   -
  E.1.1 Long Positions                  68.359            5.037                    -          2.771             560                       4
  E.1.2 Short positions                 65.516            5.037                    -          1.748             560                       4
Total assets                          337.177            10.620            8.884           5.629              6.724              3.416
Total liabilities                     338.776            10.623            8.885           5.646              6.755              3.470
Imbalance                               (1.599)                 (3)             (1)            (17)             (31)               (54)




2. Internal models and other methodologies for sensitivity analysis

See what is mentioned in the same part on the "interest rate risk and price" (section 2.1-
2.2).




216
2.4 Derivative financial instruments

A. DERIVATIVES

A.1 Regulatory trading portfolio: notional end of period and average


                                                                             Total                                                  Total
                                                                         31/12/2010                                             31/12/2009
     Asset / Type of derivative

                                                          Over the counter          Central counterparties       Over the counter           Central counterparties


1. Debt securities and interest rates                               9.334.072                                -            10.591.889                                 -
  a) Options                                                        1.994.057                                -             2.133.123                                 -

  b) Swap                                                           7.340.015                                -             8.458.766                                 -

  c) Forward                                                                    -                            -                          -                            -

  d) Futures                                                                    -                            -                          -                            -

  e) Other                                                                      -                            -                          -                            -

2. Equities and indices                                                         -                            1                          -                            1

  a) Options                                                                    -                            1                          -                            1

  b) Swap                                                                       -                            -                          -                            -

  c) Forward                                                                    -                            -                          -                            -

  d) Futures                                                                    -                            -                          -                            -

  e) Other                                                                      -                            -                          -                            -

3. Currency and gold                                                  906.366                                -               520.281                                 -

  a) Options                                                          778.630                                -               435.304                                 -

  b) Swap                                                                       -                            -                          -                            -

  c) Forward                                                          127.736                                -                 84.977                                -

  d) Futures                                                                    -                            -                          -                            -

  e) Other                                                                      -                            -                          -                            -

4. Goods                                                                 3.076                               -                  4.763                                -

5. Other underlying                                                             -                            -                          -                            -

                                                  Total           10.243.514                                 1           11.116.933                                  1
                                        Average values            10.394.511                                 1           11.109.834                                  1




                                                                                                                                                                         217
A.2 Banking: notional end of period and average
A.2.1 Hedging


                                                                             Total                                                   Total
                                                                         31/12/2010                                              31/12/2009
      Asset / Type of derivative
                                                          Over the counter           Central counterparties       Over the counter          Central counterparties


1. Debt securities and interest rates                               3.195.887                                 -             3.780.181                                -
  a) Options                                                            14.180                                -                  7.322                               -

  b) Swap                                                           3.181.707                                 -             3.772.859                                -

  c) Forward                                                                     -                            -                         -                            -

  d) Futures                                                                     -                            -                         -                            -

  e) Other                                                                       -                            -                         -                            -

2. Equities and indices                                                          -                            -                         -                            -

  a) Options                                                                     -                            -                         -                            -

  b) Swap                                                                        -                            -                         -                            -

  c) Forward                                                                     -                            -                         -                            -

  d) Futures                                                                     -                            -                         -                            -

  e) Other                                                                       -                            -                         -                            -

3. Currency and gold                                                         790                              -                         -                            -

  a) Options                                                                     -                            -                         -                            -

  b) Swap                                                                        -                            -                         -                            -

  c) Forward                                                                     -                            -                         -                            -

  d) Futures                                                                     -                            -                         -                            -

  e) Other                                                                   790                              -                         -                            -

4. Goods                                                                         -                            -                         -                            -

5. Other underlying                                                              -                            -                         -                            -

                                                  Total            3.196.677                                  -            3.780.181                                 -
                                        Average values             3.307.979                                  -            3.986.866                                 -




218
A.2.2 Other derivatives


                                                                             Total                                                  Total
                                                                         31/12/2010                                             31/12/2009
     Asset / Type of derivative
                                                          Over the counter          Central counterparties       Over the counter           Central counterparties


1. Debt securities and interest rates                                           -                            -                          -                            -
  a) Options                                                                    -                            -                          -                            -

  b) Swap                                                                       -                            -                          -                            -

  c) Forward                                                                    -                            -                          -                            -

  d) Futures                                                                    -                            -                          -                            -

  e) Other                                                                      -                            -                          -                            -

2. Equities and indices                                                  3.691                               -                  3.691                                -

  a) Options                                                             3.691                               -                  3.691                                -

  b) Swap                                                                       -                            -                          -                            -

  c) Forward                                                                    -                            -                          -                            -

  d) Futures                                                                    -                            -                          -                            -

  e) Other                                                                      -                            -                          -                            -

3. Currency and gold                                                            -                            -                          -                            -

  a) Options                                                                    -                            -                          -                            -

  b) Swap                                                                       -                            -                          -                            -

  c) Forward                                                                    -                            -                          -                            -

  d) Futures                                                                    -                            -                          -                            -

  e) Other                                                                      -                            -                          -                            -

4. Goods                                                                        -                            -                          -                            -

5. Other underlying                                                             -                            -                          -                            -

                                                  Total                 3.691                                -                 3.691                                 -
                                        Average values                  3.691                                -                  3.691                                -




                                                                                                                                                                         219
A.3 Financial derivatives: the gross positive fair value - breakdown products


                                                            Positive fair value                                     Positive fair value


                                                                   Total                                                   Total
          Wallets / Type of derivative                         31/12/2010                                              31/12/2009


                                                 Over the counter           Central counterparties       Over the counter           Central counterparties


A. Regulatory trading portfolio                                74.232                                1                 82.092                                1
  a) Options                                                    6.538                                1                  4.430                                1

  b) Interest rate swap                                        65.571                                -                 75.899                                -

  c) Cross currency swaps                                               -                            -                          -                            -

  d) Equity swap                                                        -                            -                          -                            -

  e) Forward                                                    1.927                                -                  1.172                                -

  f) Futures                                                            -                            -                          -                            -

  g) Other                                                          196                              -                      591                              -

B. Banking book - cover                                        45.471                                -                 75.128                                -

  a) Options                                                            -                            -                          -                            -

  b) Interest rate swap                                        45.454                                -                 75.128                                -

  c) Cross currency swaps                                               -                            -                          -                            -

  d) Equity swap                                                        -                            -                          -                            -

  e) Forward                                                            -                            -                          -                            -

  f) Futures                                                            -                            -                          -                            -

  g) Other                                                           17                              -                          -                            -

C. Banking - Other derivatives                                          -                            -                          -                            -

  a) Options                                                            -                            -                          -                            -

  b) Interest rate swap                                                 -                            -                          -                            -

  c) Cross currency swaps                                               -                            -                          -                            -

  d) Equity swap                                                        -                            -                          -                            -

  e) Forward                                                            -                            -                          -                            -

  f) Futures                                                            -                            -                          -                            -

  g) Other                                                              -                            -                          -                            -

                                         Total               119.703                                 1               157.220                                 1




220
A.4 Financial derivatives: Gross negative fair value - breakdown products


                                                            Negative fair value                                     Negative fair value


                                                                   Total                                                   Total
          Wallets / Type of derivative                         31/12/2010                                              31/12/2009


                                                 Over the counter           Central counterparties       Over the counter           Central counterparties


A. Regulatory trading portfolio                                76.037                                -                 81.138                                -
  a) Options                                                    6.540                                -                  4.430                                -

  b) Interest rate swap                                        67.392                                -                 74.968                                -

  c) Cross currency swaps                                               -                            -                          -                            -

  d) Equity swap                                                        -                            -                          -                            -

  e) Forward                                                    1.927                                -                  1.167                                -

  f) Futures                                                            -                            -                          -                            -

  g) Other                                                          178                              -                      573                              -

B. Banking book - cover                                        64.840                                -                 51.429                                -

  a) Options                                                            -                            -                          -                            -

  b) Interest rate swap                                        64.829                                -                 51.429                                -

  c) Cross currency swaps                                               -                            -                          -                            -

  d) Equity swap                                                        -                            -                          -                            -

  e) Forward                                                            -                            -                          -                            -

  f) Futures                                                            -                            -                          -                            -

  g) Other                                                           11                              -                          -                            -

C. Banking - Other derivatives                                          -                            -                          -                            -

  a) Options                                                            -                            -                          -                            -

  b) Interest rate swap                                                 -                            -                          -                            -

  c) Cross currency swaps                                               -                            -                          -                            -

  d) Equity swap                                                        -                            -                          -                            -

  e) Forward                                                            -                            -                          -                            -

  f) Futures                                                            -                            -                          -                            -

  g) Other                                                              -                            -                          -                            -

                                         Total               140.877                                 -               132.567                                 -




                                                                                                                                                                 221
A.5 OTC financial derivatives - Regulatory trading portfolio: notional amounts, fair value of the gross positive and
negative counterparts - contracts not covered by netting agreements

                                                                          Other public                           Financial
                                                    Governments and                                                              Company         Enterprises not
      Contracts not covered by netting agreements                            agencies        Banks            corporations                                               Other Topics
                                                        Central                                                                  Insurance            Financial



1) Debt securities and interest rates
  - Notional amount                                                   -           8.379         4.964.149         1.851.952                  -             1.950.022             559.570
  - Positive fair value                                               -                  -            2.134             691                  -                59.715                3.685
  - Negative fair value                                               -              10              65.966              22                  -                 1.759                    289
  - Future exposure                                                   -              39              37.300          21.423                  -                12.128                1.622
2) Equity and equity indices
  - Notional amount                                                   -                  -                -                  -               -                       -                    -
  - Positive fair value                                               -                  -                -                  -               -                       -                    -
  - Negative fair value                                               -                  -                -                  -               -                       -                    -
  - Future exposure                                                   -                  -                -                  -               -                       -                    -
3) Currency and gold
  - Notional amount                                                   -                  -       453.580              5.322                  -               444.230                3.234
  - Positive fair value                                               -                  -           2.715               43                  -                 5.030                     23
  - Negative fair value                                               -                  -           5.108              178                  -                 2.516                     12
  - Future exposure                                                   -                  -           4.738               53                  -                 4.648                     32
4) Other assets
  - Notional amount                                                   -                  -            1.541                  -               -                 1.535                      -
  - Positive fair value                                               -                  -             136                   -               -                     60                     -
  - Negative fair value                                               -                  -              53                   -               -                     125                    -
  - Future exposure                                                   -                  -             154                   -               -                     154                    -




222
A.7 OTC financial derivatives - the banking book: notional amounts, fair value of the gross positive and negative
counterparts - contracts not covered by netting agreements

                                                                         Other public                        Financial
                                                   Governments and                                                              Company         Enterprises not
     Contracts not covered by netting agreements                         agencies           Banks            corporations                                              Other Topics
                                                       Central                                                                  Insurance            Financial



1) Debt securities and interest rates
  - Notional amount                                                  -                  -      3.195.887                    -               -                      -                    -
  - Positive fair value                                              -                  -           45.454                  -               -                      -                    -
  - Negative fair value                                              -                  -           64.829                  -               -                      -                    -
  - Future exposure                                                  -                  -           18.459                  -               -                      -                    -
2) Equity and equity indices
  - Notional amount                                                  -                  -                -                  -               -                      -               3.691
  - Positive fair value                                              -                  -                -                  -               -                      -                    -
  - Negative fair value                                              -                  -                -                  -               -                      -                    -
  - Future exposure                                                  -                  -                -                  -               -                      -                  295
3) Currency and gold
  - Notional amount                                                  -                  -                -                  -               -                     98                  692
  - Positive fair value                                              -                  -                -                  -               -                     17                    -
  - Negative fair value                                              -                  -                -                  -               -                      -                  11
  - Future exposure                                                  -                  -                -                  -               -                     1                    7
4) Other assets
  - Notional amount                                                  -                  -                -                  -               -                      -                    -
  - Positive fair value                                              -                  -                -                  -               -                      -                    -
  - Negative fair value                                              -                  -                -                  -               -                      -                    -
  - Future exposure                                                  -                  -                -                  -               -                      -                    -




                                                                                                                                                                             223
A.9 residual life of OTC derivatives: notional



                                                                                                                       Over 1 and
                                Underlying / residual life                               Up to 1 year                                        Over 5 years            Total
                                                                                                                    up to 5 years



A) Regulatory trading portfolio
  A.1 Financial derivatives on debt securities and interest rates                               3.484.288                   2.848.741                3.001.044         9.334.073
  A.2 Financial derivatives on equities and equity indices                                                      -                        -                       -                   -
  A.3 Financial derivatives on exchange rates and gold                                            895.312                       11.054                           -       906.366
  A.4 Financial derivatives on other values                                                             3.076                            -                       -           3.076
B) Banking
  B.1 Financial derivatives on debt securities and interest rates                                 832.823                   1.703.818                  659.246         3.195.887
  B.2 Financial derivatives on equities and equity indices                                                  -                       3.691                        -           3.691
  B.3 Financial derivatives on exchange rates and gold                                                   790                             -                       -            790
  B.4 Financial derivatives on other values                                                                 -                            -                       -                   -
                                                                    Total   31/12/2010          5.216.289                   4.567.304               3.660.290         13.443.883
                                                                    Total   31/12/2009          7.080.011                   5.252.994               2.567.801         14.900.806




224
B. CREDIT DERIVATIVES
There are no credit derivatives.




C. Financial and credit derivatives
There are no financial and credit derivatives.




                                                 225
Section 3 Liquidity Risk
Operations autocartolarizzazione
Operation UBI Finance 2
As described in Part E - Section 1 - 1.1. Credit Risk - C. Securitization and sale of assets,
Banco di Brescia has signed the entire issue of securitized UBI Finance 2, whose portfolio is
the only guarantee originator.
The transaction, completed in the first half of 2009, was made by transfer to a vehicle
company called UBI Finance 2 Srl, for funding small and medium enterprises classified
performing, For a total of approx. € 2.1 billion. The sale took place on January 13, 2009, but
with the effective date of January 1, 2009, while the securitized bonds were issued on
February 27, 2009.
The main characteristics of the securities UBI Finance 2:
         Shares of Class A (Senior Tranches): 1,559,500,000.00 rated floating rate listed on
         the Irish Stock Exchange and with a maximum rating from Fitch and Moody's;
         Securities Class B (Junior Tranches): 519,850,000.00 rated and unrated return
         equal to'Additional return operation, allowing the originator to take advantage of
         Brescia Tour ' excess spread of the underlying portfolios.

Under the terms of the contract and extending the grace period of the senior notes until the
24th month after issuance, the securitized bonds have not yet been reimbursed and
therefore the remaining debt consists of the values to 31/12/2010 nominal output.

These securities were made available to the Parent Company, through repurchase
operations, to be used as securities eligible for refinancing with Central Institutes or on the
Interbank Market Collateralized-MIC.

At the same issue of the securities the SPV has with the originator bank, through the
intermediary of the parent company, a series of Interest Rate
Swaps in order to mitigate the risk of mismatching between the rates of return on the
securitized portfolio and the return of bonds.
In order to provide another form of guarantee, dated February 23, 2011 were granted by the
parent company to a liquidity vehicle to allow the coverage of interest payments on bonds in
case of temporary interruption of the collections on the securitized portfolio.

The following table shows the distribution of the portfolio (residual debt capital) for
qualitative type of claims to 31/12/2010:


      TYPE OF CREDIT                                                 Outstanding debt capital


      Performing Loans                                                               1.229.473.329,84
       Mortgage                                                                           900.285.574,13
       Guaranteed (other than mortgages)                                                  121.611.961,50
       Unsecured                                                                          207.575.794,21

      Delinquent Loans                                                                     9.058.178,20
        Mortgage                                                                            5.094.308,60
       Guaranteed (other than mortgages)                                                    3.327.948,45
        Unsecured                                                                             635.921,15

      COLLATERAL PORTFOLIO                            1.238.531.508,04


226
     Defaulted Loans                                                                   72.744.900,77
       Mortgage                                                                         37.969.121,60
      Guaranteed (other than mortgages)                                                 13.566.354,11
       Unsecured                                                                        21.209.425,06

     TOTAL FINANCE PORTFOLIO UBI 2                         1.311.276.408,81




Qualitative information

A. General, management processes and methods for measuring liquidity risk

Liquidity risk refers to the ability or otherwise of the Bank to meet its payment obligations
and / or raise additional funds on the market (funding liquidity risk), or the possibility that
the value of a possible liquidation of certain assets differs significantly the current market
value (asset liquidity risk).
The consolidated and individual liquidity risk and settlement within the policy of financial
risks, which in addition to the definition of exposure limits and thresholds for early warning,
also declined the rules for pursuing and maintaining, through policies collection and
coordinated use and efficient for the structural
Network banks and product companies.
Finally, the policy aims to make homogeneous, for all Group companies, is the means of
intervention that the criteria for the identification of economic conditions, possibly by
identifying in advance the specific exceptions.
Principals of liquidity risk on behalf of the network banks are centralized at the parent
company and compete:
     · Area Finance and ALMO Funding (garrison level 1) which provides daily monitoring
         of liquidity and risk management within the limits defined;
     · Area Risk Management (garrison level 2), which is responsible for the measurement
         of synthetic risk indicators and periodic testing of the limits

With particular reference to the position in terms of structural balance, liquidity risk is
monitored primarily through a model liquidity gap which is determined by the temporal
evolution of the net cash flows in order to find out any problems in liquidity conditions hold.
The liquidity needs of the overall gap is determined as the sum of negative (outflows exceed
inflows) found for each time band. Any positive gap found in a band is led to reduction of
negative gap relative to successive time bands.
The cash requirements so determined shall be compared with the total liquidity available -
consisting of assets and highly liquid assets readily convertible into cash - so to quantify the
degree of risk coverage generated by the position taken.




                                                                                                        227
Quantitative information
1.1 Breakdown by residual maturity of financial assets and liabilities - Currency: EURO


                                                                                                              more than 7                more than 15                more than 1 more than three                      Over 6
                                                                                  more than 1 day                                                        days                  month                                                          more than 1 year
                        Items / Time Brackets              Overnight                                              15 days                                                                up to 6 months           up to 1                                                  Over 5 years          indefinite        Total
                                                                                            7 days                                           1 month                up to 3 months                                                                  up to 5 years
                                                                                                                                                                                              months                   year



Balance sheet assets                                              4.702.696                    125.453                  166.637                    412.477                  1.157.212              553.038                     617.292                    3.307.389             4.879.652               421           15.922.267

A.1 Government bonds                                                          -                           -                          -                          -                        -           26.552                               -                            -                     -                 -              26.552

A.2 Other debt securities                                                     -                           -                          -                          -                        -                    -                     632                           2.120               5.386               55                   8.193

A.3 Quote O.I.C.R.                                                         95                             -                          -                          -                        -                    -                           -                            -                     -                 -                   95

A.4 Funding                                                       4.702.601                    125.453                  166.637                    412.477                  1.157.212              526.486                     616.660                     3.305.269             4.874.266              366            15.887.427

      - Banks                                                          56.880                   37.286                      26.979                 172.683                    439.406                67.623                       1.046                                -                     -                 -            801.903

      - Clients                                                   4.645.721                     88.167                  139.658                    239.794                    717.806              458.863                     615.614                     3.305.269             4.874.266              366            15.085.524

Balance-sheet liabilities                                       10.059.235                      36.351                      50.073               1.558.502                    343.542              477.034                     735.496                    1.629.621                310.084                     -      15.199.938

B.1 Deposits and current accounts                                10.039.669                               -                    298                 135.504                       3.573                    715                     1.726                           4.000                      -                 -       10.185.485

      - Banks                                                     1.858.800                               -                          -             125.000                               -                    -                           -                            -                     -                 -           1.983.800

      - Clients                                                   8.180.869                               -                    298                      10.504                   3.573                    715                     1.726                           4.000                      -                 -           8.201.685

B.2 Debt                                                                2.546                        657                    23.089                      26.659                112.603              419.888                     727.763                     1.563.211               305.645                     -           3.182.061

B.3 Other liabilities                                                  17.020                   35.694                      26.686               1.396.339                    227.366                56.431                       6.007                          62.410               4.439                    -           1.832.392

Off-balance-sheet                                                      6.254                    (2.105)                         21               (349.688)                  (364.324)            (670.726)                  (1.252.419)                          2.489                       -       (2.302)          (2.632.800)

C.1 Financial derivatives with underlying asset exchange                      -                 (3.129)                              -                          -                        -                (50)                            -                       2.302                      -       (2.302)                  (3.179)

      - Long positions                                                        -                 15.816                       4.236                      33.630                100.277                67.308                      33.509                           5.089                      -                 -            259.865

      - Short Positions                                                       -                 18.945                       4.236                      33.630                100.277                67.358                      33.509                           2.787                      -        2.302                 263.044

C.2 Financial derivatives without exchange of capital                   5.484                       1.024                       21                (349.793)                  (364.324)            (670.679)                 (1.252.419)                                -                     -                 -       (2.630.686)

      - Long positions                                                 65.894                       1.024                       26                       1.507                   8.019               11.396                      16.345                                -                     -                 -            104.211

      - Short Positions                                                60.410                             -                      5                 351.300                    372.343              682.075                    1.268.764                                -                     -                 -           2.734.897

C.3 Deposits and loans receivable                                             -                           -                          -                          -                        -                    -                           -                            -                     -                 -                        -

      - Long positions                                                        -                           -                          -                          -                        -                    -                           -                            -                     -                 -                        -

      - Short Positions                                                       -                           -                          -                          -                        -                    -                           -                            -                     -                 -                        -

C.4 Irrevocable commitments to provide funds                                  -                           -                          -                          -                        -                    -                           -                            -                     -                 -                        -

      - Long positions                                                        -                           -                          -                          -                        -                    -                           -                            -                     -                 -                        -

      - Short Positions                                                       -                           -                          -                          -                        -                    -                           -                            -                     -                 -                        -

C.5 Financial guarantees issued                                           770                             -                          -                     105                           -                   3                            -                         187                      -                 -               1.065




228
1.2 Breakdown by residual maturity of financial assets and liabilities - currency: USD

                                                                                                                                                                      more than
                                                                            more than 1                                        more than 15 more than 1                                                           more than 1
                                                                                                        more than 7                                                         three               Over 6
                                                                                            da y                                            days     month                                                                    year                          indefinite
                 Items / Time Brackets                  Overnight                                            15 days                                                  up to 6 months        up to 1                                      Over 5 years                        Total
                                                                                   7 days                                           1 month up to 3 months                                                         up to 5 years
                                                                                                                                                                                                  year


Balance sheet assets                                            51.636                    2.387                    1.633                  3.807              27.361             1.687                      459                    62                    -                -       89.032
A.1 Government bonds                                                    -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
A.2 Other debt securities                                               -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
A.3 Quote O.I.C.R.                                                      -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
A.4 Funding                                                     51.636                     2.387                   1.633                  3.807              27.361              1.687                      459                    62                   -                -           89.032
     - Banks                                                    44.539                              -                      -                   -                165                264                        -                      -                  -                -           44.968
     - Clients                                                      7.097                  2.387                   1.633                  3.807              27.196              1.423                      459                    62                   -                -           44.064
Balance-sheet liabilities                                       61.062                    7.786                    2.019                  1.271              17.111             1.752                    2.148                    52                    -                -       93.201
B.1 Deposits and current accounts                               60.706                     7.753                   2.019                    684              14.978                562                    1.732                    52                   -                -           88.486
     - Banks                                                           27                  7.484                           -                   -             14.219                     -                     -                      -                  -                -           21.730
     - Clients                                                  60.679                         269                 2.019                    684                 759                562                    1.732                    52                   -                -           66.756
B.2 Debt                                                                -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
B.3 Other liabilities                                                356                           33                      -                587               2.133              1.190                      416                      -                  -                -            4.715

Off-balance-sheet                                                   (181)                 2.844                        (225)                   -                 53                    57                  449                       -                  -                -           2.997
     Financial derivatives with underlying asset
C.1 exchange                                                            -                  2.844                       (225)                   -                  -                    53                     -                      -                  -                -            2.672

     - Long positions                                                   -                 17.975                   4.253                 31.032              92.317            66.291                    28.351                 1.661                   -                -       241.880
     - Short Positions                                                  -                 15.131                   4.478                 31.032              92.317            66.238                    28.351                 1.661                   -                -       239.208
C.2 Financial derivatives without exchange of capital                   -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
     - Long positions                                               8.195                           -                      -                   -                  -                     -                     -                      -                  -                -            8.195
     - Short Positions                                              8.195                           -                      -                   -                  -                     -                     -                      -                  -                -            8.195
C.3 Deposits and loans receivable                                       -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
     - Long positions                                                   -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
     - Short Positions                                                  -                           -                      -                   -                  -                     -                     -                      -                  -                -                -
C.4 Irrevocable commitments to provide funds                        (506)                           -                      -                   -                 53                     4                   449                      -                  -                -                -
     - Long positions                                                  75                           -                      -                   -                 53                     4                   449                      -                  -                -              581
     - Short Positions                                               581                            -                      -                   -                  -                     -                     -                      -                  -                -              581
C.5 Financial guarantees issued                                      325                            -                      -                   -                  -                     -                     -                      -                  -                -              325




                                                                                                                                                                                                                                                                                229
1.3 Breakdown by residual maturity of financial assets and liabilities - Currency: CHF

                                                                                                                                                                 more than
                                                                          more than 1                                      more than 15 more than 1                                                     more than 1
                                                                                                      more than 7                                                      three              Over 6
                                                                                          da y                                          days    month                                                         year                              indefinite
                 Items / Time Brackets                  Overnight                                          15 days                                               up to 6 months       up to 1                                Over 5 years                        Total
                                                                                 7 days                                         1 month up to 3 months                                                   up to 5 years
                                                                                                                                                                                            year


Balance sheet assets                                                484                   711                        312                710              2.771               183                    -                    -                  -                -           5.171
A.1 Government bonds                                                  -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
A.2 Other debt securities                                             -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
A.3 Quote O.I.C.R.                                                    -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
A.4 Funding                                                         484                      711                     312                710              2.771                183                   -                    -                  -                -           5.171
     - Banks                                                        403                           -                    -                   -                 -                    -                 -                    -                  -                -             403
     - Clients                                                       81                      711                     312                710              2.771                183                   -                    -                  -                -           4.768
Balance-sheet liabilities                                           684                           -                    -                517              4.031               138                   46                    -                  -                -           5.416
B.1 Deposits and current accounts                                   684                           -                    -                517              4.031                138                  46                    -                  -                -           5.416
     - Banks                                                          2                           -                    -                   -             3.999                    -                 -                    -                  -                -           4.001
     - Clients                                                      682                           -                    -                517                 32                138                  46                    -                  -                -           1.415
B.2 Debt                                                              -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
B.3 Other liabilities                                                 -                           -                    -                   -                 -                    -                 -                    -                  -                -               -

Off-balance-sheet                                                     -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
     Financial derivatives with underlying asset
C.1 exchange                                                          -                           -                    -                   -                 -                    -                 -                    -                  -                -               -

     - Long positions                                                 -                          50                    -                 52              1.234                    -                 -                    -                  -                -           1.336
     - Short Positions                                                -                          50                    -                 52              1.234                    -                 -                    -                  -                -           1.336
C.2 Financial derivatives without exchange of capital                 -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
     - Long positions                                                 -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
     - Short Positions                                                -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
C.3 Deposits and loans receivable                                     -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
     - Long positions                                                 -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
     - Short Positions                                                -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
C.4 Irrevocable commitments to provide funds                          -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
     - Long positions                                                 -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
     - Short Positions                                                -                           -                    -                   -                 -                    -                 -                    -                  -                -               -
C.5 Financial guarantees issued                                       -                           -                    -                   -                 -                    -                 -                    -                  -                -               -




230
1.4 Breakdown by residual maturity of financial assets and liabilities - Currency: GBP

                                                                                                                                                                more than
                                                                            more than 1                                   more than 15 more than 1                                                         more than 1
                                                                                                       more than 7                                                    three               Over 6
                                                                                            da y                                       days     month                                                            year                              indefinite
                 Items / Time Brackets                  Overnight                                           15 days                                             up to 6 months        up to 1                                   Over 5 years                        Total
                                                                                   7 days                                      1 month up to 3 months                                                       up to 5 years
                                                                                                                                                                    months                  year


Balance sheet assets                                                1.702                          5                  -                 14               298                      -                    -                    -                  -                -           2.019
A.1 Government bonds                                                    -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
A.2 Other debt securities                                               -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
A.3 Quote O.I.C.R.                                                      -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
A.4 Funding                                                         1.702                          5                  -                 14               298                      -                    -                    -                  -                -           2.019
     - Banks                                                        1.204                          -                  -                  -                  -                     -                    -                    -                  -                -           1.204
     - Clients                                                        498                          5                  -                 14               298                      -                    -                    -                  -                -             815
Balance-sheet liabilities                                           2.184                          9                  -                  8                53                     23                    2                    -                  -                -           2.279
B.1 Deposits and current accounts                                   2.184                          9                  -                  8                 53                    23                    2                    -                  -                -           2.279
     - Banks                                                            -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
     - Clients                                                      2.184                          9                  -                  8                 53                    23                    2                    -                  -                -           2.279
B.2 Debt                                                                -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
B.3 Other liabilities                                                   -                          -                  -                  -                  -                     -                    -                    -                  -                -               -

Off-balance-sheet                                                       -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
     Financial derivatives with underlying asset
C.1 exchange                                                            -                          -                  -                  -                  -                     -                    -                    -                  -                -               -

     - Long positions                                                   -                   588                       -              1.494              2.723              1.931                   1.366                    -                  -                -           8.102
     - Short Positions                                                  -                   588                       -              1.494              2.723              1.931                   1.366                    -                  -                -           8.102
C.2 Financial derivatives without exchange of capital                   -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
     - Long positions                                                   5                          -                  -                  -                  -                     -                    -                    -                  -                -               5
     - Short Positions                                                  5                          -                  -                  -                  -                     -                    -                    -                  -                -               5
C.3 Deposits and loans receivable                                       -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
     - Long positions                                                   -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
     - Short Positions                                                  -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
C.4 Irrevocable commitments to provide funds                            -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
     - Long positions                                                   -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
     - Short Positions                                                  -                          -                  -                  -                  -                     -                    -                    -                  -                -               -
C.5 Financial guarantees issued                                         -                          -                  -                  -                  -                     -                    -                    -                  -                -               -




                                                                                                                                                                                                                                                                      231
1.5 Breakdown by residual maturity of financial assets and liabilities - Currency: JPY

                                                                                                                                                                more than
                                                                         more than 1                                      more than 15 more than 1                                                    more than 1
                                                                                                     more than 7                                                      three              Over 6
                                                                                         da y                                          days     month                                                       year                              indefinite
                 Items / Time Brackets                  Overnight                                         15 days                                               up to 6 months       up to 1                               Over 5 years                        Total
                                                                                7 days                                         1 month up to 3 months                                                  up to 5 years
                                                                                                                                                                                           year


Balance sheet assets                                                64                   202                        29                 226              1.947               389                   -                    -                  -                -           2.857
A.1 Government bonds                                                 -                           -                    -                   -                 -                    -                -                    -                  -                -               -

A.2 Other debt securities                                            -                           -                    -                   -                 -                    -                -                    -                  -                -               -

A.3 Quote O.I.C.R.                                                   -                           -                    -                   -                 -                    -                -                    -                  -                -               -

A.4 Funding                                                         64                      202                      29                226              1.947                389                  -                    -                  -                -           2.857

     - Banks                                                        52                           -                    -                   -                 -                    -                -                    -                  -                -              52

     - Clients                                                      12                      202                      29                226              1.947                389                  -                    -                  -                -           2.805

Balance-sheet liabilities                                            4                   296                        98                    -             2.947               552                   -                    -                  -                -           3.897

B.1 Deposits and current accounts                                    4                          64                    -                   -             2.255                552                  -                    -                  -                -           2.875

     - Banks                                                         1                          64                    -                   -             2.255                552                  -                    -                  -                -           2.872

     - Clients                                                       3                           -                    -                   -                 -                    -                -                    -                  -                -               3

B.2 Debt                                                             -                      232                      98                   -               692                    -                -                    -                  -                -           1.022

B.3 Other liabilities                                                -                           -                    -                   -                 -                    -                -                    -                  -                -               -

Off-balance-sheet                                                    -                   232                          -                   -                 -                    -                -                    -                  -                -            232
     Financial derivatives with underlying asset
C.1 exchange                                                         -                   232                          -                  -                  -                    -                -                    -                  -                -             232
     - Long positions                                                -                   236                        226                  -              1.519                    -                -                    -                  -                -           1.981

     - Short Positions                                               -                          4                   226                  -              1.519                    -                -                    -                  -                -           1.749

C.2 Financial derivatives without exchange of capital                -                           -                    -                  -                  -                    -                -                    -                  -                -               -

     - Long positions                                                -                           -                    -                  -                  -                    -                -                    -                  -                -               -

     - Short Positions                                               -                           -                    -                  -                  -                    -                -                    -                  -                -               -

C.3 Deposits and loans receivable                                    -                           -                    -                  -                  -                    -                -                    -                  -                -               -

     - Long positions                                                -                           -                    -                  -                  -                    -                -                    -                  -                -               -

     - Short Positions                                               -                           -                    -                  -                  -                    -                -                    -                  -                -               -

C.4 Irrevocable commitments to provide funds                         -                           -                    -                  -                  -                    -                -                    -                  -                -               -

     - Long positions                                               50                           -                    -                  -                  -                    -                -                    -                  -                -              50

     - Short Positions                                              50                           -                    -                  -                  -                    -                -                    -                  -                -              50

C.5 Financial guarantees issued                                      -                           -                    -                  -                  -                    -                -                    -                  -                -               -




232
1.6 Breakdown by residual maturity of financial assets and liabilities - Currency: CAD

                                                                                                                                    more than 15               more than 1                                                             more than 1
                                                                                                                more than 7                                                                more than three            Over 6
                                                                                  more than 1 day                                             days                         month                                                                 year                          indefinite
                   Items / Time Brackets                   Overnight                                                  15 days                                                                up to 6 months       up to 1                                   Over 5 years                        Total
                                                                                             7 days                                    1 month               up to 3 months                                                            up to 5 years
                                                                                                                                                                                                                      year

                                                                                                                                                                                                              -                                                                             -
Balance sheet assets                                                          -                       167                       -                        -                       145                          -                    -                    -                  -                             312
                                                                                                                                                                                                                                                                                            -
A.1 Government bonds                                                          -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
A.2 Other debt securities                                                     -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
A.3 Quote O.I.C.R.                                                            -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
A.4 Funding                                                                   -                       167                       -                        -                           145                                           -                    -                  -                             312
                                                                                                                                                                                                              -                                                                             -
     - Banks                                                                  -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Clients                                                                -                       167                       -                        -                           145                                           -                    -                  -                             312
                                                                                                                                                                                                              -                                                                             -
Balance-sheet liabilities                                              330                                  -                   -                        -                             -                                           -                    -                  -                             330
                                                                                                                                                                                                              -                                                                             -
B.1 Deposits and current accounts                                      30                                   -                   -                        -                             -                                           -                    -                  -                             330
                                                                                                                                                                                                              -                                                                             -
     - Banks                                                           31                                   -                   -                        -                             -                                           -                    -                  -                             311
                                                                                                                                                                                                              -                                                                             -
     - Clients                                                               19                             -                   -                        -                             -                                           -                    -                  -                              19
                                                                                                                                                                                                              -                                                                             -
B.2 Debt                                                                      -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
B.3 Other liabilities                                                         -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
Off-balance-sheet                                                             -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
C.1 Financial derivatives with underlying asset exchange                      -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Long positions                                                         -                             -                   -                  216                       3.471                                             3.788             1.080                     -                            8.555
                                                                                                                                                                                                              -                                                                             -
     - Short Positions                                                        -                             -                   -                  216                       3.471                                             3.788             1.080                     -                            8.555
                                                                                                                                                                                                              -                                                                             -
C.2 Financial derivatives without exchange of capital                         -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Long positions                                                         -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Short Positions                                                        -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
C.3 Deposits and loans receivable                                             -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Long positions                                                         -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Short Positions                                                        -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
C.4 Irrevocable commitments to provide funds                                  -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Long positions                                                         -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
     - Short Positions                                                        -                             -                   -                        -                             -                                           -                    -                  -                                -
                                                                                                                                                                                                              -                                                                             -
C.5 Financial guarantees issued                                               -                             -                   -                        -                             -                                           -                    -                  -                                -




                                                                                                                                                                                                                                                                                                           233
1.7 Breakdown by residual maturity of financial assets and liabilities - currency: SEK

                                                                                    more                                        more than
                                                                  more than 1        than 7   more than 15 more than 1               three               Over 6       more than 1
                                                                             day                     days      month                                                        year                              indefinite
                Items / Time Brackets             Overnight                         15 days                                    up to 6 months        up to 1                               Over 5 years                        Total
                                                                        7 days                    1 month up to 3 months                                               up to 5 years
                                                                                                                                                           year


Balance sheet assets                                          -                 -             -              -             -                     -                -                    -                  -                -             -
A.1 Government bonds                                          -                 -             -               -            -                     -                -                    -                  -            -                 -
A.2 Other debt securities                                     -                 -             -               -            -                     -                -                    -                  -            -                 -
A.3 Quote O.I.C.R.                                            -                 -             -               -            -                     -                -                    -                  -            -                 -
A.4 Funding                                                   -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Banks                                                   -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Clients                                                 -                 -             -               -            -                     -                -                    -                  -            -                 -
Balance-sheet liabilities                                     -                 -             -              -             -                     -                -                    -                  -                -             -
B.1 Deposits and current accounts                             -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Banks                                                   -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Clients                                                 -                 -             -               -            -                     -                -                    -                  -            -                 -
B.2 Debt                                                      -                 -             -               -            -                     -                -                    -                  -            -                 -
B.3 Other liabilities                                         -                 -             -               -            -                     -                -                    -                  -            -                 -
Off-balance-sheet                                             -                 -             -              -             -                     -                -                    -                  -                -             -
    Financial derivatives with underlying asset
C.1 exchange                                                  -                 -             -               -            -
                                                                                                                                                 -                -                    -                  -            -                 -

    - Long positions                                          -                 -             -            850             -                    50                -                    -                  -            -               900
    - Short Positions                                         -                 -             -            850             -                    50                -                    -                  -            -               900
    Financial derivatives without exchange of
C.2 capital                                                   -                 -             -               -            -
                                                                                                                                                 -                -                    -                  -            -                 -

    - Long positions                                          -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Short Positions                                         -                 -             -               -            -                     -                -                    -                  -            -                 -
C.3 Deposits and loans receivable                             -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Long positions                                          -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Short Positions                                         -                 -             -               -            -                     -                -                    -                  -            -                 -
C.4 Irrevocable commitments to provide funds                  -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Long positions                                          -                 -             -               -            -                     -                -                    -                  -            -                 -
    - Short Positions                                         -                 -             -               -            -                     -                -                    -                  -            -                 -
C.5 Financial guarantees issued                               -                 -             -               -            -                     -                -                    -                  -            -                 -




234
1.8 Breakdown by residual maturity of financial assets and liabilities - Currency: PLN

                                                                                                 more than                                               more than
                                                                        more than 1                               more than 15 more than 1                                                     more than 1
                                                                                                         7                                                     three              Over 6
                                                                                       day                                     days    month                                                         year
                 Items / Time Brackets                  Overnight                                   15 days                                              up to 6 months       up to 1                               Over 5 years                        Total
                                                                                                                                           up to 3
                                                                              7 days                                   1 month             months                                               up to 5 years                          indefinite
                                                                                                                                                                                   year


Balance sheet assets                                                -                        -                -                   -                  -                    -                -                    -                  -                -             -
A.1 Government bonds                                                -                        -                -                   -                  -                    -                -                    -                  -                -             -

A.2 Other debt securities                                           -                        -                -                   -                  -                    -                -                    -                  -                -             -
A.3 Quote O.I.C.R.                                                  -                        -                -                   -                  -                    -                -                    -                  -                -             -

A.4 Funding                                                         -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Banks                                                         -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Clients                                                       -                        -                -                   -                  -                    -                -                    -                  -                -             -
Balance-sheet liabilities                                           -                        -                -                   -                  -                    -                -                    -                  -                -             -
B.1 Deposits and current accounts                                   -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Banks                                                         -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Clients                                                       -                        -                -                   -                  -                    -                -                    -                  -                -             -
B.2 Debt                                                            -                        -                -                   -                  -                    -                -                    -                  -                -             -

B.3 Other liabilities                                               -                        -                -                   -                  -                    -                -                    -                  -                -             -
Off-balance-sheet                                                   -                        -                -                   -                  -                    -                -                    -                  -                -             -
     Financial derivatives with underlying asset
C.1 exchange                                                        -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Long positions                                                -                        -                -                   -             629                       -                -                    -                  -                -           629
    - Short Positions                                               -                        -                -                   -             629                       -                -                    -                  -                -           629
C.2 Financial derivatives without exchange of capital               -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Long positions                                                -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Short Positions                                               -                        -                -                   -                  -                    -                -                    -                  -                -             -
C.3 Deposits and loans receivable                                   -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Long positions                                                -                        -                -                   -                  -                    -                -                    -                  -                -             -

    - Short Positions                                               -                        -                -                   -                  -                    -                -                    -                  -                -             -
C.4 Irrevocable commitments to provide funds                        -                        -                -                   -                  -                    -                -                    -                  -                -             -
    - Long positions                                                -                        -                -                   -                  -                    -                -                    -                  -                -             -

    - Short Positions                                               -                        -                -                   -                  -                    -                -                    -                  -                -             -
C.5 Financial guarantees issued                                     -                        -                -                   -                  -                    -                -                    -                  -                -             -




                                                                                                                                                                                                                                                                 235
1.9 Breakdown by residual maturity of financial assets and liabilities - currency:                                                                                                                                                                                                    OTHER
    CURRENCIES

                                                                                                                                                                                   more than
                                                                                                                               more than 15                more than 1                                                    more than 1
                                                                                                           more than 7                                                                  three                Over 6
                                                                                  more than 1 day                                         days                       month                                                             year                          indefinite
                   Items / Time Brackets                   Overnight                                             15 days                                                           up to 6 months       up to 1                                   Over 5 years                        Total
                                                                                             7 days                                1 month                up to 3 months                                                   up to 5 years
                                                                                                                                                                                                             year

                                                                                                                                                                                                    -
Balance sheet assets                                                   940                             -                   -                          -              1.947                          -                 -                       -                  -                -           2.887
A.1 Government bonds                                                          -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
A.2 Other debt securities                                                     -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
A.3 Quote O.I.C.R.                                                            -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
A.4 Funding                                                            940                             -                   -                          -               1.947                                           -                       -                  -                -           2.887
                                                                                                                                                                                                    -
     - Banks                                                           940                             -                   -                          -               1.923                                           -                       -                  -                -           2.863
                                                                                                                                                                                                    -
     - Clients                                                                -                        -                   -                          -                   24                                          -                       -                  -                -             24
                                                                                                                                                                                                118
Balance-sheet liabilities                                              784                             -                   -                  33                     1.972                                            2                       -                  -                -           2.909
                                                                                                                                                                                                118
B.1 Deposits and current accounts                                      784                             -                   -                     33                            -                                      2                       -                  -                -            937
                                                                                                                                                                                                    -
     - Banks                                                                 32                        -                   -                          -                        -                                      -                       -                  -                -             32
                                                                                                                                                                                                118
     - Clients                                                         752                             -                   -                     33                            -                                      2                       -                  -                -            905
                                                                                                                                                                                                    -
B.2 Debt                                                                      -                        -                   -                          -               1.972                                           -                       -                  -                -           1.972
                                                                                                                                                                                                    -
B.3 Other liabilities                                                         -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
Off-balance-sheet                                                             -                        -                   -                          -                 684                                           -                       -                  -                -            684
                                                                                                                                                                                                    -
C.1 Financial derivatives with underlying asset exchange                      -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
     - Long positions                                                         -                       35                   -                          -                        -                                      -                       -                  -                -             35
                                                                                                                                                                                                    -
     - Short Positions                                                        -                       35                   -                          -                        -                                      -                       -                  -                -             35
                                                                                                                                                                                                    -
C.2 Financial derivatives without exchange of capital                         -                        -                   -                          -                 684                                           -                       -                  -                -            684
                                                                                                                                                                                                    -
     - Long positions                                                         5                        -                   -                          -                 684                                           -                       -                  -                -            689
                                                                                                                                                                                                    -
     - Short Positions                                                        5                        -                   -                          -                        -                                      -                       -                  -                -              5
                                                                                                                                                                                                    -
C.3 Deposits and loans receivable                                             -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
     - Long positions                                                         -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
     - Short Positions                                                        -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
C.4 Irrevocable commitments to provide funds                                  -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
     - Long positions                                                         -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
     - Short Positions                                                        -                        -                   -                          -                        -                                      -                       -                  -                -               -
                                                                                                                                                                                                    -
C.5 Financial guarantees issued                                               -                        -                   -                          -                        -                                      -                       -                  -                -               -




236
Section 4 Operational risk

Qualitative information

A. General, management processes and methods for measuring operational risk

For operational risk means the risk of loss resulting from inadequate or failed internal
processes, people and systems or from external events.
Fall into this category, among others, losses resulting from fraud, human error, business
disruption, unavailability of systems, breaches of contract, natural disasters.
This definition includes legal risk of loss resulting from violations of laws or regulations,
contractual liability, tort or other disputes but excludes strategic and reputational risk.
Operational risk is characterized by relations of cause and effect such that, compared to one
or more triggers, generating the adverse event, or effect, which is directly connectable to an
economic loss.
We define, therefore, all the operating loss resulting from adverse economic effects of an
operational nature events as recorded in company accounts and unlikely to have impact on
the income statement.
In working out the operational risk management policy in the UBI Banca Group has paid
special attention to the maintenance of an adequate risk profile consistent with the risk
appetite defined by the Senior Management. The Group policy provides that operational
risks are identified, measured and monitored as part of the overall process of Operational
Risk Management with the following objectives:
    · identify the causes of adverse events leading to operating losses and, consequently,
         increase profitability and improve management efficiency through the identification
         of critical areas, their monitoring and optimization of the control system;
    ·    optimize mitigation policies and risk transfer such as, for example those of
         insurance, in light of the extent and actual exposure to risk;
    ·    optimize the allocation and absorption of operational risk capital and provisioning
         policies with the goal of creating value for shareholders;
    ·    support decision making on the opening of new businesses, activities, products and
         systems;
    ·    develop a culture of operational risk at the level of awareness throughout the
         business unit structure;
    ·    meet the regulatory requirements of the New Basel Accord on regulatory capital of
         banks and banking groups.

In light of the regulatory framework defined by the publication of Circular 263 dated
27/12/2006 by the Bank of Italy, the Bank shall adopt the Standardised Approach (TSA) for
calculating operational risk capital requirement and has initiated a process aimed at the
authorization request to the Financial Regulator to use an internal model of type
Advanced (Advanced Measurement Approach, AMA), presently used for management
purposes only.


Organizational Model

The Organizational Model in charge of the Operational Risk is based on a combination of
components, depending on the responsibility assigned and the specific position held in the
organization, centralized and decentralized model consistent with the Federal Group, multi-
functional and integrated, in which the Parent assumes tasks of management, coordination
and control of garrison of business functions including through support to the activities of
the network banks and product companies in their core business, the supply of common
services to support the business directly or through subsidiaries.

The design of an organizational structure was different depending on the size and
complexity of operations of each entity member of the Group: Parent Company

                                                                                                 237
Services, Commercial Banks, product companies. The responsibilities of each for its own
area of expertise, centralized at the parent company are attributed to:
      · Operational Risk Committee: is the body of guidance, government and defense of the
          overall process of managing operational risk. The composition, operating rules and
          responsibilities are governed by the Rules and Regulations Company;

      · Operational Risk: as a structure responsible for the overall operational risk
          management system is the unit entrusted with the design, development and
          maintenance of business methods for detection, measurement, monitoring and
          verifying the effectiveness of mitigation of operational risk and related reporting
          systems. It is also delegated the tasks of coordinating and controlling the overall
          management system at Group level;
      · Service Methodologies and Models: is the unit responsible for carrying out the
      calculation of
          Capital requirement for legal entities wishing to adopt advanced methods validated
          according to the instructions of the Service Validation and Process Models and other
          agencies and bodies corporate or otherwise, from time to time in charge. This service
          work done in service to the Operational Risk Management;
      ·   Service Models and Process Validation: function as an independent subjects or
          units involved in the development of management systems and risk measurement are
          delegated to it the evaluation activities on an ongoing basis the quality of the
          management of operational risks and their compliance with regulatory requirements
          in time, all business and operational needs 'evolution of the market. In these
          activities is included to verify the reliability of the capital requirement of the use and
          detection of the measurement system in decision-making and operational risk
          management (use test).
      ·   Service Risk Policies: is the unit responsible for drawing up and revising the "Policy
          on oversight of the UBI Banca Group Operational Risk. " Also intervenes in the
          process of assessment and conclusion of insurance for the mitigation of operational
          risks in the manner detailed in the Regulation of Insurance Risk
          Management.

For the decentralized components of the Bank, the organizational model has four levels of
responsibility:
          Contact Operational Risk (RRO) is responsible, within its scope Legal (Parent /
          Banking Network / Company product), the completion of the overall framework for
          operational risk management policies defined by the Group and the respective
          implementing regulation;
          Local Support Operational Risk (SROL) plays the main role of support Contact
          Operational Risk for the realization of the overall process of operational risk
          management for the entities to which they belong. For the legal entity to which they
          belong, also represents the unity of support and coordination of Risk and Risk
          Champion Owner of reference for the roles involved in operational risk management
          system;
          Risk Champion (RC) oversees the conduct of the operational process Operational
          risk management (LDC and SRA) for its overall validity, in relation to their business
          area by coordinating and supporting the Risk Owners of reference. Supports the
          process of risk monitoring and participates in the drafting and implementation of
          mitigation strategies;
          Risk Owner (RO) is responsible for recognizing and reporting loss events (LDC) and
          / or potential risk factors attributable to operating (SRA) that occur during daily
          activities. Participate in the implementation of corrective actions and improvements
          reported higher levels and to reduce the level of risk exposure.




238
Management systems, measurement and control

The Operational Risk Management System Group is composed of:
        a decentralized process of enumeration of operating losses (Loss Data Collection)
        designed to detect integrated and systemic adverse events occurred that resulted in
        an actual loss, a near-loss ("Near Miss") or a profitable event. The operating losses
        are recorded periodically reconciled with the accounting and updated in real time by
        Risk Owners and / or Risk Champion in a procedure, available on the intranet of
        the Group, with separate disclosure of any recoveries obtained, through the
        activation of specific policies insurance;
        a structured process of mapping and assessment of risk scenarios and the factors of
        business environment and internal control system relevant (Risk Assessment)
        inherent in the business areas of the Group, supported by a data processing system
        for its integrated management, with l ' intended to provide a self-exposure to the risk
        of potential future losses, the efficiency of controls and mitigation measures in
        place;
        a database of operational losses suffered by the Italian system from 2003. The
        Group supports the initiative launched by the ABI DIPO Centre in terms of
        operational risks for the exchange of data loss in the system since its date of
        establishment;
        a system for measuring economic capital and regulatory capital requirements for the
        establishment of operational risk by business unit by the AMA and standardized
        method. The operational risk measurement via AMA is conducted with a
        methodology approach to Extreme Value Theory (EVT) as a function of all sources of
        information seen in the three previous points (operational losses recorded internally
        (LDC), evaluation of potential exposure to risk ( SRA) and its operating losses by the
        Italian system (DIPO)).


Reporting
To support the monitoring of operational risks has created a reporting system that provides
the information necessary for the proper management, measurement and mitigation of risk
undertaken by the Group.
This system is structured on the same level of liability under the organizational model to
support multiple information needs inherent in the federal model of
Group, with the aim of ensuring the standardization of information and allow a regular
review of operational risks undertaken preparatory to the definition of strategies and
management objectives consistent with the standards of acceptable risk.
Reporting for the corporate bodies, top management of the Parent and the main legal body of
the Group and the Operational Risk Committee, is regularly prepared centrally by the
Operational Risk Management and includes, with degrees of detail and temporal frequency
varying according to the need andamentale analysis of internal loss and its recovery is
accompanied by a comparison with external data system, the results of the assessment of
exposure to risk by identifying areas of vulnerability and the description of the actions to be
taken to prevention and mitigation of risk and their effectiveness.


Mechanisms of risk transfer
UBI Banca Group has entered into the appropriate insurance policies to cover the main
operational risks transferred taking into account the requirements of the Statement of
prudential supervision (Circular 263/2006, Bank of Italy). The policies were taken out by
UBI Banca
ScpA own behalf and on behalf of the network banks and product companies of the Group
concerned.




                                                                                                  239
Legal risk
Banco di Brescia is involved in several legal proceedings of various kinds and legal process
arising from the ordinary course of business. While it is not possible to predict with
certainty the final outcome, it is considered that any adverse outcome of these proceedings
would not, individually or together, a significant negative effect on financial and economic
situation of the Bank.
In the face of requests received, the Bank considered that sufficient appropriations to lie on
the basis of a reconstruction of the statements of the amounts potentially at risk and taking
into account the more-established case law on this issue. Among the relevant judgments of
which are part of the Bank, are currently pending actions performed by an insolvency
Giacomelli Sport SpA, for a total of € 830,000 required, and Formenti Seleco SpA, for a
request of Euro 1,447,453 ( the case will be updated on March 24, 2011 for filing of CTU).
The special administration of Formenti Seleco SpA, is suing over the Banco di Brescia, 18
other entities, for the actions of abusive lending.
In this regard it should be noted are known the contents of the three judgments of the
Supreme Court of Cassation in the United Sections of March 2006 on all'insussistenza the
legitimacy of the bankruptcy trustee, exercise, against the banks, the "action for damages
grant from the abuse of credit (Case no. 7030, nr. 7029 and 7031 of 28 March 2006)
confirmed in subsequent case law (see Cass. Civ. sect. I, 13 June 2008 nr. 16031). It
should also be emphasized that the Court of Monza - which is the same judicial office for
the hearing that case - in a recent decision (September 12, 2007) has strictly ruled out that
the disbursement of a loan at market conditions can be a source of damage compensated
for the undertaking being financed. It has not envisage significant damage in the injury of
unjust wealth: damage is configured in a legal sense only if there is any infringement of a
legal interest and lending, even supposedly illegal, it does not perform such damage (the
cause, after deposit their final performances, and 'was brought back to the bench).
With regard to corporate litigation, not directly attributable to the conduct of ordinary
business, and tax litigation, please refer to specific paragraphs of the consolidated annual
report.




240
Quantitative information

The graphs below show that the main source of operational risk for the Bank in January
2004 - December 2010 "Processes" (58% and 10% of the impacts of frequencies) and
"external causes" (36% of the impacts and 89% of frequencies). The risk drivers "Processes"
include, among other things, the errors are not intentional, the inadequate training of
personnel, procedural and process inefficiencies, non-compliance procedures and internal
controls. The risk drivers "external causes" includes human actions are caused by third
parties and not directly controlled by banks such as theft and robbery, card fraud, damage
caused by natural events (earthquakes, floods, etc ...) , other external events.




The trend of the impact gross of insurance recoveries and other recoveries outside of a
reduction of 34% over the previous year driven primarily by a reduction in disputes with
customers. In terms of numbers of detected events is an increase of 12% primarily due to
increased fraud on debit cards for which they have been set up appropriate interventions for
prevention and risk reduction.

              Distribution of operational losses by year of detection (January 2004 - December 2010)



    25%



    20%



    15%



    10%



     5%



     0%
               2004                 2005                  2006                2007                     2008   2009   2010


                                                                    No Events         Impacts




                                                                                                                            241
                 List of five major losses recognized in the period
                                 January 2004 - December 2010




The analysis of operating losses about the data recorded in the period between 1 January
2004 and December 31, 2010 shows a concentration of the phenomenon in the types of
event
"Execution, delivery and process management" (13% frequency and 30% of the total impacts
detected) and "external fraud" (60% frequency and 29% of the total impacts detected).
For the same period of analysis, data from the banking system (Association DIPO-ABI) have
the largest concentration of operational losses at the event type "Customers Products &
Business Practices" (20% frequency and 25% of the total impacts detected) and "External
fraud" (44% frequency and 25% of the total impacts detected).




242
Capital requirement

The Bank shall take over from 2008, the standardized approach (TSA) for calculating the
capital charge on operational risk (cf. Bank of Italy Circular No 263 of 27/12/2006 relating
to new arrangements for the prudential supervision of banks).
The capital requirement determined by the standardized components (TSA) calculated by
multiplying the gross income (the "relevant indicator" of the item 120 of the income
statement of the consolidated former Bank of Italy Circular 262 of December 22, 2005)
broken down by lines of business regulations, for the specific beta coefficients defined by
supervisory regulations (cf. Bank of Italy Circular No 263, December 27, 2006 and No. 155,
December 18, 1991). The relevant indicator for regulatory business line has been
extrapolated from the data management control, applying the classification criteria defined
by national legislation and in compliance with regulations.
The capital requirement at December 31, 2010, calculated as the requirements for the past
three years, amounted to € 79.8 million. It absorbed 48% of the retail banking business
line, 31% from Commercial Banking, 10% from the Trading & Sales and
10% of the retail brokerage. The average coefficient of absorption is significant when
compared to 13%.
The capital requirement at December 31, 2010 shows a reduction of EUR 6 million (-7%)
compared to December 31, 2009 primarily due to the reduction in operating income.




                                                                                               243
Part F - Information on capital
Section 1 Shareholders' equity

A - Qualitative Information

The company's assets is the capital and reserves, for whatever reason made. The aggregate
(whose values are given in the following tables) is to oversee all the business risks in
previous comments. Policies and processes adopted in the management of the assets relate
to all of the choices to define the size and the optimum combination of various means of
capitalization, so that the capital base is consistent with the objectives of the Bank's risk
tolerance, respect for supervisory requirements.

According to current supervisory arrangements, banks belonging to banking groups can
benefit from a reduction of 25% of the total capital requirement - applicable on an individual
basis - provided that the consolidated total requirement is met.
Since the latter condition occurred, the Bank of such reduction. Membership shall UBI,
finally, constitutes a valid and continuing assurance that the regulatory capital will always
be met by using, where appropriate, for capital increases.


B - Quantitative information
B 1 Heritage: breakdown



                                                                                            Amount            Amount
                                              Items / Values
                                                                                          31/12/2010        31/12/2009


1. Capital                                                                                       615.632           593.300
2. Share premium                                                                                 120.000           120.000
3. Reserves                                                                                      638.311           423.226
      - Profit                                                                                   517.369           423.226
      a) Legal                                                                                    90.522            84.074
      b) statutory                                                                                      -                 -
      c) Treasuryshares                                                                                 -                 -
      d) other                                                                                   426.847           339.153
      - Other                                                                                    120.942                  -
4. Equity instruments                                                                                   -                 -
5. (Treasury Shares)                                                                                    -                 -
6. Revaluation reserves                                                                           14.182            21.206
      - Financial assets available for sale                                                        4.587             9.779
      - Tangible assets                                                                                 -                 -
      - Intangible assets                                                                               -                 -
      - Coverage of foreign investment                                                                  -                 -
      - Cash flow hedges                                                                                -                 -
      - Exchange differences                                                                            -                 -
      - Non-current assets held for sale                                                                -                 -
      - Gains (losses) related to defined benefit pension plans                                   (3.184)           (1.353)
      - Quote of the valuation reserves relating to investments accounted for at equity                 -                 -
      - Special revaluation laws                                                                  12.779            12.779
7. Net income (loss)                                                                              71.979           128.973
Total                                                                                          1.460.104         1.286.705




The increase in shareholders' equity is due to the overall capital strengthening connection
with the operation optimization planning (capital increase to 22.3 million IPO and listing
positive reserve for 120.9 million) and profit for the period amounted to 71.9 million, the
change in valuation reserves has reduced the net worth of about 7 million euro.


244
B.2 Valuation reserves for financial assets available for sale:
composition


                                                                        Total                                             Total
                                                                    31/12/2010                                         31/12/2009
                     Assets / Values

                                                        Positive reserve       Negative Reserve        Positive reserve        Negative Reserve

1.Debt securities                                                          -                       -                       -                      -
2. Equities                                                         4.483                      (216)                   9.471                      -
3. Quote of O.I.C.R.                                                 320                           -                    308                       -
4. Funding                                                             -                           -                       -                      -
                                                Total              4.803                       (216)                   9.779                      -




B.3 Revaluation reserve of financial assets available for sale: annual changes


                                                                                    Debt                Equities        Quote of O.I.C.R.             Funding


1. Initial                                                                                 -                9.471                      308                       -
2. Positive changes                                                                        -                       -                    12                       -
2.1 Increases in fair value                                                                -                      -                     12                       -
2. 2 Reversal of negative reserves                                                         -                      -                      -                       -
     from impairment                                                                       -                      -                      -                       -
     on disposals                                                                          -                      -                      -                       -
2. 3 Other changes                                                                         -                      -                      -                       -
3. Decreases                                                                               -               (5.204)                       -                       -
3. 1 Reductions fair value                                                                 -                (5.204)                      -                       -
3.2 Adjustments for impairment                                                             -                      -                      -                       -
3.3 Reversal of positive reserves on disposal                                              -                      -                      -                       -
3. 4 Other changes                                                                         -                      -                      -                       -
4. Closing balance                                                                         -                 4.267                     320                       -




                                                                                                                                                                245
Section 2 The assets and the ratios

2.1 CAPITAL

A - Qualitative Information

The capital has been determined in accordance with the regulations in force, as defined by
the provisions of the supervisor.


1. Tier

The Tier is the capital, profit reserves net of intangible assets are not "innovative capital
instruments."

2. Tier

The Tier consists of the valuation reserves and subordinated loans.

3. Capital for the third level
There is no capital for the third level.

B - Quantitative information


                                                                                   Total              Total
                                                                               31/12/2010         31/12/2009

A. Basic assets before the application of prudential filters                      1.406.742          1.211.027

B prudential filters of basic assets:                                                         -                  -
      - Filters IFRS prudential positive (+)                                                  -                  -
      - Filters IFRS prudential negative (-)                                                  -                  -
C. Basic assets gross of deductions (A + B)                                       1.406.742          1.211.027
D. Deductions from Tier                                                                       -                  -
E. Total basic assets (TIER 1) (C-D)                                              1.406.742          1.211.027
F. Supplementary capital before the application of prudential filters                49.699            102.608
G. Prudential filters for supplementary capital                                         (52)               (91)
      - Filters IFRS prudential positive (+)                                                  -                  -
      - Filters IFRS prudential negative (-)                                            (52)               (91)
H. Tier 2 gross of deductions (F + G)                                                49.647            102.517
I. Deductions from Tier 2                                                                     -                  -
L. Total supplementary capital (Tier 2) (H-I)                                        49.647            102.517
M. Deductions from Tier I and Tier II capital                                                 -                  -
N. Regulatory capital (E + L-M)                                                   1.456.390          1.313.545
O. 3rd-level Capital (Tier 3)                                                                 -                  -
P. Capital including Tier 3 (N + O)                                               1.456.390          1.313.545




The assets described above was determined taking into account the phasing shown in the
"Other information - Measure of the Bank of Italy on prudential filters".




246
2.2 Capital adequacy

A. Qualitative information

The garrison of the capital adequacy of the Bank is centralized at the parent company UBI
Banca. The latter, beginning as a guidance and coordination of the Group companies -
evaluates the needs of capitalization, in a strict sense, either through the issuance of
subordinated debt or hybrid capital instruments of the subsidiary. The top management of
the Parent shall make proposals for assistance to their governing bodies which decide on it.
The proposal, once approved by the Boards of the Parent, is then submitted to the
competent bodies of the subsidiaries. On the basis of the development plan of the Group,
risk profiles and related assets within the constraints of supervision, the parent company
analyzes and coordinates the needs of capital adequacy, lending themselves as privileged
counterparts in access to capital markets, in an integrated optimum size of the assets.

The approach adopted for the assessment of capital adequacy is based on two assumptions:
             adequately support the Bank's operations, including in relation to defined strategic
             plans;
             meet from time to time the signs of the Supervisory Body in respect of capital levels.

To this end, it is constantly monitored the progress of the Capital Ratio (Tier 1) and Total
Capital Ratio. The loan growth strategy is shaped by the levels of remuneration and risk
compared to its absorption sheet.

B. Quantitative information

                                                                                Non-weighted amounts               Weighted / requirements

                                         Categories / Values
                                                                               Total            Total            Total              Total
                                                                            31/12/2010       31/12/2009       31/12/2010         31/12/2009


 A. ACTIVITIES 'RISK

A.1 Credit risk and counterparty                                                       -                -                  -                  -

        1. Standardized approach                                               20.215.799        25.187.474      13.597.584         10.333.247

        2. Methodology based on internal ratings                                       -                -                  -                  -

              2.1 Base                                                                 -                -                  -                  -

              2.2 Advanced                                                             -                -                  -                  -
        3. Securitization                                                              -                -                  -                  -
 B. CAPITAL REQUIREMENTS                                                               -                -                  -                  -

B.1 Credit risk and counterparty                                                       -                -         1.087.807           825.642

B.2 Market risks                                                                       -                -                2.498              6.524

        1. Standard method                                                             -                -                2.498              6.524

        2. Internal models                                                             -                -                  -                  -

        3. Concentration risk                                                          -                -                  -                  -

B.3 Operational risk                                                                   -                -            79.860             87.817

        1. A basic method                                                              -                -                  -                  -

        2. Standardised Approach                                                       -                -            79.860             87.817

        3. Advanced method                                                             -                -                  -                  -

B.4 Other requirements                                                                 -                -                  -                  -

B.5 Other components of the calculation (*)                                            -                -         (292.541)          (229.996)
B.6 Total capital requirements                                                         -                -          877.623            689.987
 C. ACTIVITIES 'RISK AND RATIOS                                                        -                -

C.1 Risk-weighted assets                                                               -                -        10.970.290          8.624.841
C.2 Capital / risk-weighted assets (Tier 1 capital ratio)                              -                -           12.82%             14.04%
C.3 Capital including Tier 3 / risk-weighted assets (Total capital ratio)              -                -           13.28%             15.23%



(*) In calculating capital requirements banks belonging to the Italian banking groups also take account of reduction
of 25% of the requirements outlined under "B.5 - Other computing elements".




                                                                                                                                            247
Based on the most recent interpretative guidance to risk-weighted assets are represented as
the reciprocal of the minimum requirement of 8%, including a discount of 25% for banks
belonging to a banking group on a consolidated basis to comply with the mandatory
minimum requirement . Excluding this reduction, and for comparison with the amounts
shown above represent the effect that the coefficients given in row C.2 and C.3 were
respectively equal to 9.62% and 9.96%, while those of December 2009 would amount to
10.53% and 11.42%.
The ratios shown were determined based on the provisions contained in Circular 263/06
and 155/91, as amended - respectively - from the 7th update of 28 January 2011 and the
13th update of February 9, 2011.
Please note that the methodology is standardized.




248
Part G - Business Combinations or business enterprise
For the Bank there is no such case.




                                                        249
Part H - Transactions with related parties
1. Information on the compensation of key management personnel

Directors' fees (1)


                                                                                                  Total
                                                                                              31/12/2010


          Short-term benefits for employees (2)                                                            3.209
          Benefits following termination of employment (3)                                                   273

          Other long-term                                                                                          -

          Allowances termination of employment                                                                     -

          Share-based payments                                                                                     -




(1) For "Leaders" are "key management personnel of the entity including the directors of the entity"
(2) For example: wages, salaries and social security contributions, bonus payments instead of vacation and sick
leave, benefits in kind. Are included within the fixed and variable fees paid to Directors as equivalent to the cost of
labor and social security contributions paid by the company for employees.
(3) For example: pensions, other retirement benefits, life insurance and health care after the employment
relationship.


In regard to compensation paid during the year 2010 states that, in addition to the fixed
component of remuneration set by individual agreements, there is a significant variable
component linked to the achievement of strategic objectives of the Group. With reference to
the base salary is highlights the presence, in addition to the usual payment in cash, of
benefit to the completion of the remuneration package which the supplementary pension
fund, the health insurance and accident policy. There are no plans to encourage medium to
long term.

In particular, we highlight the following institutions pay (for the definition of which can be
found in the appropriate accounting policy):

    a)    Short-term benefits
          In the short-term benefits are included salaries, social security contributions,
          allowances for leave not taken replacement, sick leave, paid leave, benefits such as
          medical care, housing.

    b)    Post-employment benefits
          In the post-employment benefits are covered by pension plans, pension, insurance
          and the processing of end rapporto.Nei the managers in question are active forms of
          life insurance and supplementary pension schemes with time horizon after the
          termination of the employment relationship employee.


2. Information on transactions with related parties

In accordance with the provisions of applicable regulations, please note that all transactions
carried out by the Parent Company with related parties were carried out according to criteria
of substantial and procedural fairness, under conditions similar to those applied in
transactions with unrelated third parties.

In the preparation of these financial statements for the issuer related party means, in
accordance with the international accounting standard (International Accounting Standards
- IAS) No 24, a party if:



                                                                                                                       250
   a)   directly or indirectly controls, is controlled by or is under common control with the
        issuer, or holds an issuer to exercise significant influence or joint control over the
        issuer;
   b)   is an associate of the issuer (as defined in IAS 28 - Investments in Associates);
   c)   is a joint venture in which the issuer is a participant;
   d)   is a key management of the issuer or its parent company, whereby the key
        management people who have the power and responsibility for planning, directing
        and controlling the activities of the issuer, including the directors of the issuer;
   e)   is a close relative of one of the persons mentioned in subparagraphs a) or) (for
        immediate family members include those who have the potential to influence the
        individual related to the issuer, or be influenced in their relationship with the
        issuer);
   f)   is a controlled entity, jointly owned or subject to significant influence by one of the
        persons referred to in subparagraphs d) or e), or those persons directly or indirectly
        holding a significant proportion of the voting rights in that entity;
   g)   is a pension fund for employees of the issuer or any entity related to it.

As regards the effect produced by the management and coordination of the Parent, as
provided by art. 2497 bis of the Civil Code, we note that in line with the organizational
model that provides for the centralization at UBI
Bank of activities of strategic planning and management, and at UBI Sistemi e Servizi SCpA
activities of technical-operational, the Parent Company and its subsidiary to the various
Group companies provide a range of services, governed by contracts drawn up based on
intra-group criteria of appropriateness, transparency and uniformity, the agreed payments
for services rendered to According to these contracts were determined according to market
conditions or, where they have not found suitable on the market benchmarks in relation to
the specific characteristics of the services rendered on the basis of cost incurred.
Among the major intra-group contracts valid at the end of the year included those that
implement the centralization of activities at the parent company in the Areas of Government,
Business and involving the parent company and the main banks of the Group as well as
implementation of contracts cd consolidated tax return (referred to in Articles 117 to 129 of
Presidential Decree No. 917/1986 of the Consolidated Income Tax) concluded by the parent
company. Also to be announced all intercompany agreements implementing the
centralization at UBI Sistemi e Servizi activities support all major
UBI Group of Companies.

Further information on related party transactions are reflected in subsequent tables.




                                                                                                  251
Transactions with Group companies and companies subject to significant influence


                                                                                                                                           31/12/2010
                                                                          Activities             Activities
                        Related party      Assets / liabilities
                                                                          Financial              Financial          Loans to              Loans to            Derivatives          Payables         Payables          Titles               Warranties
                                                   Held
                                                                        available for               Held            banks                  score               coverage            banks              score         movement                   issued
                                             for negozizione
                                                                             sale                  expiry

Parent                                                              -                        -                -       741.885                        -                      -       3.276.199                  -         382.209                    113
Check                                                               -                        -                -             -                        -                      -               -                  -                       -              -
Connect                                                             -                        -                -               21              7.236                         -             378                  -                       -          5.889
Joint venture                                                       -                        -                -                -                     -                      -                 -                -                       -                -
Check / Connect to / from parent                                    -                        -                -        15.128                74.379                         -           12.864           19.495                        -          2.195
Executives                                                          -                        -                -                -              1.056                         -                 -         28.044                   560                    -
Other related parties                                               -                        -                -                -             96.922                         -                 -        178.573               20.655                     -




The reports listed in the line "Affiliated companies" are for UBI.S., Bank of Vallecamonica, UBI Banca International, while in the line "Check /
linked to / from parent" shows the other Group companies consolidated.




                                                                                                                                                31/12/2010
                                                                                                                                                                                                                                               Other
                           Related party                                                                                               Other operating                                                                                     operating
                                                                  Interest and              Dividends and         Commissions                  income                 Interest and Expenditure               Commissions                    expenses
                                                              similar income                similar income           active            Management               similar charges         administrative             passive             Management


Parent                                                                       62.140                           -           7.221                          75                 (24.700)              (14.450)             (3.754)                          -
Check                                                                                   -                     -                    -                     -                          -                    -                        -                     -
Connect                                                                           737                     861                      -                 123                        (155)             (38.680)                        -                     -
Joint venture                                                                       -                         -                -                     -                              -                    -                       -                     -
Check / Connect to / from parent                                               2.274                          -          35.434                  2.037                      (30.123)                 (850)                    (53)                  (36)




In the line "Check / linked to / from parent" Record this Group companies are not subsidiaries, but included in the scope of consolidation.




252
                                                                                                                                     31/12/2010
                                                                                                                                     Income and
                               Related party                                                                                         expenses
                                                                                                              Commissions                                          Other income           Expenditure
                                                                      Net interest income