Aldermore Group PLC Investor Presentation Half Year Results 2016 - - PowerPoint PPT Presentation

Investor Presentation

Aldermore Group PLC

Half Year Results 2016

aldermore.co.uk

Half year results 2016

1

Results highlights Performance update Portfolio overview and outlook

Continue to build on our excellent track record of delivery

Generated strong returns and continued growth in H1 2016

1

A diversified business supporting a significant, structural market opportunity

2

2

Consistent, robust and prudent underwriting approach

3

Benefit from modern systems, scaleable operating platform and an experienced team

5

Deliberately constructed granular and highly secured portfolio

4

Well positioned to navigate any challenges ahead and take advantage of opportunities

6

Underlying profit before tax (£m)(1) Cost of risk (bps)

Another strong six months for the Group

3

Underlying cost income ratio (%)(1) Net interest margin (%)

3.6% 3.6% H1 2015 H1 2016 44 63 H1 2015 H1 2016 53 45 H1 2015 H1 2016 20 20 H1 2015 H1 2016

(1) Excluding impairment of goodwill of £4.1m (pre- and post-tax) in H1 2016 and IPO related costs of £4.1m (pre-tax) and £3.2m (post-tax) in H1 2015 (2) H1 2016 RoE excludes impairment of goodwill of £4.1m (post-tax) and is after payment of AT1 coupon of £6.6m (post-tax)

 Underlying PBT(1) up 45% to £63m; RoE(2) of 18.0%  Excellent H1 origination, up by 26% to £1.5bn,

supports net loan growth of 11% to £6.8bn

 Maintained net interest margin at 3.6% as expected  Underlying cost/income ratio(1) further improved

by 8 percentage points to 45%

 Another excellent credit performance; cost of risk

stable at 20bps

 Strong capital position; total capital ratio of 14.0%

Generating balanced growth across a diversified portfolio

4

1.3 1.5 0.2 0.2 0.8 0.9 2.4 2.7 1.4 1.5 2015 H1 2016

Asset Finance Invoice Finance SME Commercial Mortgages Residential Mortgages Buy-to-Let

6.1 6.8 +9% +12% +12% +11%

• 3%

+11% Net loans to customers (£bn)  Asset Finance grew by 11% to £1.5bn ‒ Customer numbers increased by 9% to c46,000 ‒ Origination up by 20% to £509m  SME Commercial Mortgages up 12% to £0.9bn ‒ 15% growth in customers to c1,800 ‒ Strong origination growth of 29% to £210m  Buy-to-Let grew by 12% to £2.7bn ‒ Customers numbers up by 9% to c17,000 ‒ Excellent origination of £519m up 74%; reflects

market spike ahead of stamp duty changes in April

 Residential Mortgages up by 9% to £1.5bn ‒ 8% increase in customers numbers to c11,000 ‒ Origination was robust at £243m although down by

14% compared with H1 2015

Half year results 2016

5

Results highlights Performance update Portfolio overview and outlook

Commentary

Note: Numbers may not exactly sum / reconcile due to rounding. (1) Includes derivatives held for risk management, fair value adjustments for portfolio hedged risk, other assets, prepayments and accrued income, deferred tax and property, plant and equipment. (2) Includes corporate deposits.

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(3) CET1 ratio = Common equity tier 1 capital / Risk Weighted Assets (RWA) (4) The year end 2015 leverage ratio was restated to 7.2% in the published Pillar 3 disclosures following finalisation of off-balance sheet exposures (5) Tangible book value = Ordinary shareholders’ equity less intangible assets. Outstanding number

• f shares as at 31 December 2015 and 30 June 2016 were 344.7m

Continued balance sheet momentum…

30 June 31 December (£m) 2016 2015 Growth % Key balance sheet items Net loans 6,799 6,145 11% Cash and investments 875 806 9% Intangible assets 22 24 (9%) Fixed and other assets(1) 50 34 45% Total assets 7,746 7,009 11% Customer deposits(2) 6,538 5,742 14% Wholesale funding 521 636 (18%) Other liabilities 118 97 22% Total liabilities 7,177 6,475 11% Ordinary shareholders' equity 495 460 8% AT1 capital 74 74

• Total equity

569 534 7% Total liabilities and equity 7,746 7,009 11% Key ratios Loans to deposits ratio 104% 107% Net loan growth (£bn) 654 1,344 Fully loaded CRD IV RWAs 4,281 3,693 Fully loaded CRD IV CET1 capital 473 436 Fully loaded CRD IV CET1 ratio(3) 11.0% 11.8% Fully loaded CRD IV Leverage ratio(4) 6.9% 7.2% Tangible book value per share (p)(5) 137 126 1 3 5

• 1. Net loan growth of 11% to £6.8bn

− Excellent origination of £1.5bn; up by 26% − Customer numbers up by 8% to c77,000 − Balanced growth across a diversified portfolio

• 1. Intangible assets down by 9%

− £4m goodwill impairment reflects current lower financial services company valuations

• 1. Deposits up by 14% to £6.5bn

− SMEs form 23% of deposit base − Loans to deposits ratio of 104%

• 1. Wholesale funding of £521m

− Utilised less wholesale due to growth in deposits

• 1. 8% growth in shareholder equity driven by profits

for the first 6 months − Tangible book value per share of 137p

1 3 4 1 2 5 5 2 3 4

(£m) H1 2016 H1 2015 Growth % Key P&L items Interest income 176 139 26% Interest expense (60) (47) (27%) Net interest income 116 92 26% Net fee and other operating income(1) 13 12 5% (1) (300%) Operating income 128 105 22% Underlying operating expenses (58) (56) (4%) IPO related costs – (4) n/a Impairment of goodwill (4) – n/a Profit before impairment losses 66 45 47% Impairment losses (6) (5) (23%) Profit before tax 59 40 50% Tax (17) (8) (104%) Profit after tax 42 31 35% Underlying profit before tax(3) 63 44 45% Key ratios Net interest margin 3.6% 3.6% Underlying cost/income ratio(4) 45% 53% Cost of risk 20bps 20bps Underlying return on equity(3)(5) 18.0% 18.6% Earnings per share 10.3 p 8.8 p Net derivatives (expense)/ income and gains on disposal of debt securities(2)

…drives a 45% increase in underlying profit before tax

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(3) Excludes goodwill impairment of £4.1m (pre- and post-tax) in H1 16 and IPO related costs of £4.1m pre- tax (£3.2m post-tax) in H1 2015 (4) Cost/income ratio = Underlying operating expenses/ Operating income (5) Return on Equity = (PAT / average ordinary shareholder equity)*2 less (AT1 coupon paid / average

• rdinary shareholder equity). Annual AT1 coupon payable in April 2016 of £8.9m pre-tax (£6.6m post-tax)

and in April 2015 of £3.5m pre-tax (£2.8m post-tax)

• 1. Net interest income up by 26% to £116m

− Driven by balance sheet growth − Net interest margin stable at 3.6%

• 2. Operating income increased by 22%

− Fee income growth driven by mortgage volumes

• 2. Tightly controlled cost base

− Underlying operating expenses up 4% to £58m − Underlying cost/income ratio further improved by 8pts

• 2. Rigorous focus on credit quality maintained

− Overall cost of risk stable at 20bps − Additional level of caution within collective provision charge as emergence periods extended

• 2. Underlying PBT up by 45% to £63m
• 3. Tax charge reflects UK bank surcharge and

zero relief on goodwill impairment

• 4. Underlying return on equity of 18.0%

3 1 2 4 1 1 3 4 2 5

(1) Net fees and other operating income = Fee income + Fee expense + Other

• perating income

(2) Net derivatives (expense)/income and gains on disposal of debt securities = Net income from derivatives and other financial instruments + Gains on disposal of available for sale debt securities

4

Commentary

3 6 7 5 6 7

53 63 H1 2015 H1 2016 21 30 H1 2015 H1 2016

6.9% 6.9%

SME Commercial Mortgages

28 37 H1 2015 H1 2016 139 176 H1 2015 H1 2016

Actively managing portfolio to hold overall gross margin stable

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(1) Gross interest margin = interest income / average net loans

Gross interest margin (%)(1)

Asset Finance

36 44 H1 2015 H1 2016

6.5% 6.2%

4 3 H1 2015 H1 2016

Invoice Finance

4.3% 4.3%

Residential Mortgages

5.0% 5.1%

Group

5.4% 5.4%

Interest income (£m)

Buy-to-Let

5.0% 4.9%

Successfully maintained net interest margin at 3.6%

(1) Numbers may not exactly sum / reconcile due to rounding (2) Loans to Deposits Ratio (LDR) = net customer loans / customer deposits (3) Cost of funding = interest expense / average net loans (4) Net interest margin = net interest income / average net loans

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 Deposit-led funding strategy

− £6.5bn of customer deposits; up by 14% − Retail deposits grew by 15% to £4.8bn − Now serving c126,000 customers − SME deposits grew by 8% to £1.5bn − Customer numbers grew by 12% to c16,000 − Corporate deposits now exceed £200m

 Supported by wholesale funding of £521m

− On-balance sheet FLS funding of £323m − RMBS of £156m; reduction since year end reflects capital repayments on underlying mortgages − Tier 2 debt and other wholesale of £42m

 Delivered stable cost of funding of 1.9%  Net interest margin maintained at 3.6%

− In line with management expectations

3.4 4.2 4.8 1.0 1.4 1.5 0.2 0.2 0.6 0.6 0.5 5.1 6.4 7.1 2014 2015 H1 2016 Retail deposits SME deposits Corporate deposits Wholesale funding 2.1% 1.9% 1.9% 2014 2015 H1 2016 Cost of funding (%) 107%

LDR(2) (%)

Increasingly diversified funding base (£bn)(1)

104%

Stable cost of funding(3)

108%

Net interest margin(4)

3.4% 3.6% 3.6% 2014 2015 H1 2016 Net interest margin (%)

53% 45% H1 2015 H1 2016

Delivered a further 8% reduction in cost/income ratio

 Underlying operating expenses up by only 4%

as we leverage our scaleable operating model − In line with management expectations

 Other administrative expenses of £55m

− Driven by a small number of additional people to support growth

 Provisions relates to FSCS charge of £1m

− Full year charge accounted for in first half − Only interest levy applicable in 2016

 Depreciation and amortisation remains stable  High degree of operating leverage

− Cost income ratio reduced by a further 8 percentage points to 45% in H1 2016

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Leveraging operational efficiency 52 55 2 1 2 2 56 58 H1 2015 H1 2016

Depreciation & amortisation Provisions Other administrative expenses

Underlying operating expenses(£m)(1) Underlying cost/income ratio (%)(1)(2)

(1) H1 2016 excludes £4.1m of pre-tax goodwill impairment and H1 2015 excludes IPO related costs of £4.1m (pre-tax) (2) Cost income ratio = Underlying operating expenses / operating income

Benefit from a diversified, granular and highly secured portfolio

11

Average loan balance (as at 30 June 2016) (1) % of loan book at origination constituted by secured loans for Asset Finance; prepayment percentage for Invoice Finance; average loan-to-value ratio for SME Commercial Mortgages, Buy-to-Let and Residential Mortgages. (2) Non-performing loans ratio = Individually impaired loans / gross loans

Granular Portfolio

c£32k

82% 82% 2015 H1 2016

(3) Cost of risk = Impairments / average net loans

Group cost of risk (bps)(3) Group NPL ratio (%)(2)

0.31 0.31 2015 H1 2016

NPL ratio (%)(2) Cost of risk (bps)(3) Highly secured(1)

40 34 H1 2015 H1 2016 68% 69% 2015 H2016 1.51 1.68 2015 H1 2016 69 127 H1 2015 H1 2016 64% 64% 2015 H1 2016 0.83 0.59 2015 H1 2016 33 27 H1 2015 H1 2016 68% 69% 2015 H1 2016 0.21 0.18 2015 H1 2016 5 7 H1 2015 H1 2016 77% 77% 2015 H1 2016 0.29 0.31 2015 H1 2016 15 12 H1 2015 H1 2016 0.37 0.33 2015 H1 2016 20 20 H1 2015 H1 2016

SME Commercial Mortgages Asset Finance Invoice Finance Buy-to-Let Residential Mortgages c£136k c£468k c£163k c£139k

11.8% 11.0% 2.0% 1.7% 1.3% 1.2% 2015 H1 2016 Tier 2 capital ratio AT1 capital ratio CET1 ratio

Maintained a strong capital base with total capital ratio of 14%

Total capital ratio(%)(1)(2) Movement in CET1 capital ratio (%)

(1) CET1 capital ratio = Common Equity Tier 1 capital / risk weighted assets (2) Totals may not sum precisely due to rounding (3) Leverage ratio = Tier 1 capital / total exposures

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 Capital position remains strong with total

capital ratio of 14.0%

− RWAs up 16% to £4.3bn (December 2015: £3.7bn); primarily driven by lending growth − AT1 and Tier 2 ratios marginally reduced

 CET1 capital ratio in line with management

expectations at 11.0%

− Operational risk charge recalculated annually in Q1 based on last 3 years’ income − AT1 dividend payable annually at end of April − Organic capital generation driven by retained profits

 Leverage ratio(3) of 6.9% remains well above

regulatory minimum requirements

 Continue to assess potential to adopt IRB

11.8% 11.5% 11.3% 11.3% 11.0% 11.0% (0.3%) (0.2%) 1.1% (1.4%) 2015 CET1 ratio 2016

• perational

risk charge AT1 coupon Organic capital generation Increase in RWAs H1 2016 CET1 ratio

14.0% 15.1%

Half year results 2016

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Results highlights Performance update Portfolio overview and outlook

Supporting the UK’s SMEs, landlords and homeowners

(1) As at 30 June 2016

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 Asset Finance

− Hire purchase and leasing − Target smaller ticket transactions

 SME Commercial Mortgages

− Commercial property owner occupiers and investors − Multi-let rather than single trophy-tenant developments

 Buy-to-Let

− Seamless offering supported by expert teams, flexible approach and modern systems − Able to span whole market from a single property to a large portfolio and corporate structures − Maximum loan size of £1m up to 70% LTV

 Residential mortgages

− Target underserved prime credit quality customers − Self-employed, professionals, first time buyers, Help to Buy − Maximum loan size of £1m up to 75% LTV

A diversified specialist lender Award-winning, straightforward and transparent products

£1.5bn(1)

22% 2% 14% 40% 22% Asset Finance Invoice Finance SME Commercial Mortgages Buy-to-Let Residential Mortgages

£6.8bn(1)

Benefit from a granular portfolio with low concentration risk …

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Asset Finance(1) SME Commercial Mortgages(1)(2) Buy-to-Let(1) Residential Mortgages(1)

0% 15% 30% 45% 0 - 50k 50k - 100k 100k - 150k 150k - 200k 200k - 300k 300k - 400k 400k - 500k 500k - 1m 1m - 2m 2m+ 0% 5% 10% 15% 20% 25% 0 - 50k 50k - 100k 100k - 150k 150k - 200k 200k - 300k 300k - 400k 400k - 500k 500k - 1m 1m - 2m 2m+ 0% 10% 20% 30% 40% 0 - 50k 50k - 100k 100k - 150k 150k - 200k 200k - 300k 300k - 400k 400k - 500k 500k - 1m 1m - 2m 2m+ 0% 10% 20% 30% 0 - 50k 50k - 100k 100k - 150k 150k - 200k 200k - 300k 300k - 400k 400k - 500k 500k - 1m 1m - 2m 2m+

(1) Credit concentration by asset size (£) (2) Excludes Property Development of £211m

Average

• utstanding =

c£32k Average

• utstanding =

c£468k Average

• utstanding =

c£163k Average

• utstanding =

c£139k

Average loan balance (as at 30 June 2016)

… and high levels of tangible security

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31% 30% 11% 11% 7% 2% 8%

Plant & Machinery Commercial Vehicles Professional Loans Cars - used Cars - new IT equipment Other £1.5bn(1)

(1) As at 30 June 2016 (2) Excludes Property Development of £211m; average loan to gross development value as at 30 June 2016 was 58%

Asset Finance backed by wide range of assets SME Commercial Mortgages (Indexed LTVs)(2) Buy-to-Let (Indexed LTVs) Residential Mortgages (Indexed LTVs)

48% 24% 24% 3% 1% 0% 0% 0 - 50 50 - 60 60 - 70 70 - 75 75 - 80 80 - 85 85+ < 75% LTV = 99% 15% 11% 16% 9% 8% 6% 1% 0% 0% 1% 2% 3% 6% 22% 0-50 50-60 60-70 70-75 75-80 80-85 85+ Average Owner Occupied (non Help to Buy) LTV = 62% Average Help to Buy (Mortgage Guarantee) LTV = 88%

% of portfolio which is Help to Buy

21% 22% 30% 14% 9% 3% 1% 0 - 50 50 - 60 60 - 70 70 - 75 75 - 80 80 - 85 85+ < 75% LTV = 87%

Owner occupied (non-HTB)

Proven ability to react to a changing market environment

Benefit from consistent and prudent underwriting approach as well as diversified portfolio

5

Continue to build on our excellent track record of operational and financial delivery

4

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Confident of our ability to navigate any challenges ahead and take advantage of opportunities

6

Purely UK-focused business; sheltered from potential changes to EU market access

1

Business as usual; remain focused on delivering strong returns and balanced growth

3

No direct impact on lending or savings observed to date; continue to monitor closely

2

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Appendices

Aldermore is a diversified, specialist lender

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68% 21% 3% 5% 2% 1% Retail deposits SME deposits Corporate deposits FLS RMBS Other wholesale

£6.8bn(1)

Customer loans Funding base

£7.1bn(1)

(1) As at 30 June 2016

 Focused on large, growing customer segments

which are under- or poorly served by the wider market

 Targeted human underwriting facilitated by modern,

legacy-free systems and combined with a rigorous focus on credit risk management

 Diversified lending portfolio provides multiple

avenues to drive continued significant growth

 Dynamic online deposit franchise anchors

diversified funding base

 Expanding distribution; leveraging strong intermediary

relationships as well as growing direct capability

 Delivering award-winning customer service  Leveraging operating platform successfully to drive

efficiency and innovation

22% 2% 14% 40% 22% Asset Finance Invoice Finance SME Commercial Mortgages Buy-to-Let Residential Mortgages

82% 68% 18% 32% 424 509 H1 2015 H1 2016 92% 93% 8% 7% 281 243 H1 2015 H1 2016 80% 83% 20% 17% 298 519 H1 2015 H1 2016 79% 84% 21% 16% 163 210 H1 2015 H1 2016 41% 53% 59% 47% 20 19 H1 2015 H1 2016

• 5%

0.3%

Diversified portfolio provides multiple growth levers

(1) Total market originations for H1 2016, except Invoice Finance which represents a stock figure as at March

• 2016. Asset Finance excludes High Value. Source: Finance & Leasing Association (Asset Finance); Asset

Based Finance Association (Invoice Finance) and CML (Buy-to-Let and Residential Mortgages) (2) Annualised market share based on H1 2016 origination for Asset Finance, SME Commercial Mortgages, Buy- to-Let and Residential Mortgages. For Invoice Finance based on June 2016 period-end balance (3) Market size for SME Commercial Mortgages based on DeMontfort University study. H1 2016 market

• riginations assumed to be half of full year 2015 originations (latest available data)

Asset Finance Residential Mortgages Invoice Finance SME Commercial Mortgages

 Grew customer numbers by 9% to c17,000  Took advantage of the expected spike in demand

ahead of introduction of 3% additional stamp duty

 Grew customer numbers by 9% to 46,000  Organic origination growth of 20% mainly driven

by Wholesale

 Customer numbers marginally reduced to 1,100  Continue to reorient away from smaller clients  Customer numbers grew by 15% to c1,800  Origination driven by Commercial Investment and

Property Development

 Leveraged strong broker relationships

£1.5bn £0.2bn £0.9bn £1.5bn Net loans (£bn), as at 30 June 2016 Intermediated Direct / Sales

Business segment H1 2016 performance Market size(1) and current market share(2)

3.5% £15bn 0.8% £19bn 0.8% £27bn(3) 2.3% £95bn 20

Loan origination (£m)

Buy-to-Let £2.7bn

£24bn

 Customer numbers grew by 8% to c11,000  Continue to support Help to Buy  Direct broadly stable at 7%

6% 22% 16% 12% 13% 10% 8% 13% Greater London South East Midlands East Anglia North West South West Yorkshire Other 35% 20% 8% 9% 8% 8% 4% 8% Greater London South East Midlands East Anglia North West South West Yorkshire Other

Diversified and prudently underwritten mortgage portfolios

21

Geographic split (%) Indexed Loan to Value (%)(1)

SME Commercial Mortgages Buy-to-Let Residential Mortgages

£2.7bn

Net loans as at 30 June 2016 0% 1% 3% 24% 24% 48% 80+ 75-80% 70-75% 60-70% 50-60% 0-50% 1% 3% 9% 14% 30% 22% 21% 85%+ 80-85% 75-80% 70-75% 60-70% 50-60% 0-50% 24% 12% 11% 11% 16% 11% 15% 85%+ 80-85% 75-80% 70-75% 60-70% 50-60% 0-50%

£1.5bn

19% 18% 11% 8% 12% 13% 7% 12% Greater London South East Midlands East Anglia North West South West Yorkshire Other

£0.9bn Help to Buy and Family Guarantee (1) SME Commercial Mortgages excludes Property Development of £211m

99% 1% Online Phone 75% 3% 22% Online Phone Post

Dynamic, online deposit franchise forms core of funding base

22

Retail SME

Balance Product suite Distribution and

• perations

(1) Deposit balances breakdown by initial contract term as at 30 June 2016 (2) Based on accounts opened in H1 2016

1.0 1.4 1.5 2014 2015 H1 2016 SME deposits (£bn) 13% 13% 16% 23% 19% 9% 1% 6% Notice (incl. ISA Notice) <1 year ISA 1 year 2 year 3 year 4 year 5 year 2% 58% 40% Notice <1 year 1 year

(2) (2) (2)

£4.8bn(1)

Customer deposits as at 30 June 2016 3.4 4.2 4.8 2014 2015 H1 2016 Retail deposits (£bn)

£1.5bn(1)

(2) (2)

Additional information – Risk weighted asset density

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(1) Risk weighted asset density = Risk Weighted Assets / Net loans (2) Total risk weighted asset density = Total Risk Weighted Assets / Total assets

Risk weighted asset density (%)(1) Asset Finance 71% 70% Invoice Finance 68% 70% SME Commercial Mortgages 121% 110% Buy-to-Let 37% 37% Residential Mortgages 37% 36% Credit risk weighted asset density 56% 55% Total risk weighted asset density(2) 55% 53% 30 June 2016 31 December 2015

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Disclaimer

This document contains certain forward-looking statements with respect to the business, strategy and plans of Aldermore Group PLC (“Aldermore”) and its current goals and expectations relating to its future financial condition and performance. Such forward-looking statements include, without limitation, those preceded by, followed by or that include the words "targets", "believes", "estimates", "expects", "aims", "intends", "will", "may", "anticipates", "projects", "plans", "forecasts", "would", "could", "should" or similar expressions

• r negatives thereof. Statements that are not historical facts, including statements about Aldermore’s, its directors’ and/or management’s beliefs and expectations, are forward-

looking statements. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend upon circumstances that will or may occur in the future. Factors that could cause actual business, strategy, plans and/or results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements made by Aldermore or on its behalf include, but are not limited to: general economic and business conditions in the UK and internationally; market related trends and developments; fluctuations in exchange rates, stock markets, inflation, deflation, interest rates and currencies; policies of the Bank of England, the European Central Bank and other G8 central banks; the ability to access sufficient sources of capital, liquidity and funding when required; changes to Aldermore’s credit ratings; the ability to derive cost savings; changing demographic developments, and changing customer behaviour, including consumer spending, saving and borrowing habits; changes in customer preferences; changes to borrower or counterparty credit quality; instability in the global financial markets, including Eurozone instability, the potential for countries to exit the European Union (the “EU”) or the Eurozone, and the impact of any sovereign credit rating downgrade or other sovereign financial issues; technological changes and risks to cyber security; natural and other disasters, adverse weather and similar contingencies outside Aldermore’s control; inadequate or failed internal or external processes, people and systems; terrorist acts and other acts of war or hostility and responses to those acts; geopolitical, pandemic or other such events; changes in laws, regulations, taxation, accounting standards or practices, including as a result of an exit by the UK from the EU; regulatory capital or liquidity requirements and similar contingencies outside Aldermore’s control; the policies and actions of governmental or regulatory authorities in the UK, the EU or elsewhere including the implementation and interpretation of key legislation and regulation; the ability to attract and retain senior management and other employees; the extent of any future impairment charges or write- downs caused by, but not limited to, depressed asset valuations, market disruptions and illiquid markets; market relating trends and developments; exposure to regulatory scrutiny, legal proceedings, regulatory investigations or complaints; changes in competition and pricing environments; the inability to hedge certain risks economically; the adequacy of loss reserves; the actions of competitors, including non-bank financial services and lending companies; and the success of Aldermore in managing the risks of the foregoing. Any forward-looking statements made in this document speak only as of the date they are made and it should not be assumed that they have been revised or updated in the light

• f new information of future events. Except as required by the Prudential Regulation Authority, the Financial Conduct Authority, the London Stock Exchange PLC or applicable

law, Aldermore expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this document to reflect any change in Aldermore’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. The information, statements and opinions contained in this document and subsequent discussion do not constitute a public offer under any applicable law or an offer to sell any securities or financial instruments or any advice or recommendation with respect to such securities or financial instruments.