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Green Bond Investor Presentation

OUR VALUE PROPOSITION

A PERSONAL «SIGNATURE» SIMPLE DIGITAL SERVICES A COMMITMENT TO A STRONG AND SUSTAINABLE WESTERN NORWAY

SPAREBANKEN VEST

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SPAREBANKEN VEST

Customers Among the best customer service Equity certificates Among the best ROE Community Strongest commitment for a sustainable and strong Western Norway Employees The best place to work, for personal and career development

OUR GOALS

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Funding Loans Savings Products Sponsorships Suppliers Media Engagement Our

• perations

Employees Transparency Social investment AML

Our goal is to contribute to Western Norway becoming the leading region in Norway in climate technology and climate cuts by 2030

OUR 360° APPROACH

SPAREBANKEN VEST

Sparebanken Vest

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WE START WITH OURSELVES

We start with ourselves

293

tons CO2

2018*

*Cemasys climate accounting report

2025 Transport Waste Energy

• 147

tons CO2

SPAREBANKEN VEST

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Transport

• All own cars will be fossil free by the end of 2020
• Flight transport reduction programme for 2019/20

Reduction:

24,5 tons CO2

2019 and 2020 Reduction:

2–3 tons CO2

2019 and 2020 Reduction:

17 tons CO2

2019 and 2020 Waste

• Paper and print reduction programme
• Food waste reduction programme
• Plastic reduction programme

Energy reduction

• Electricity certificates are claimed for all energy purchased
• Energy reduction programme of 5% yearly (8,5 tons of CO2)
• Green loan energy standards in all new locations

SPAREBANKEN VEST

Tot

• tal

al cut uts s for 2019 9 and 2020: 20: 43,5 5 tons ns CO2 Fut uture ure cut uts un until l 2025: 5: 103,5 3,5 tons ns CO2

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A new rule of purchasing: All our suppliers must be climate neutral by ultimo 2020

SPAREBANKEN VEST

• In order to be a Sparebanken Vest

supplier, companies must agree to:

• measure their CO2 footprint,
• set goals for footprint reduction,
• and compensate for their climate

debt.

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Social dividend

200 mill NOK

• f Sparebanken Vest’s social dividend

will be earmarked through the end of 2020 to provide financial support to projects that promote new green technology, sustainability and the transition to a fossile free future.

SPAREBANKEN VEST

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Our Customers

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Respo pons nsible e busi sine ness ss

✓ For us, responsible business means integrating corporate social responsibility in all business processes and all parts of the value chain. ✓ Sparebanken Vest requires that customers must comply with the laws and agreements. ✓ We expect customers to respect regulations for the use of natural resources. ✓ Sparebanken Vest follows the Money Laundering Act and applies a strict policy applies to establishing customer relationships. ✓ Sparebanken Vest does not wish to fina inance nce: :

• Coal-fired power production.
• Coal mining.
• Extraction of oil from oil sand.
• Extraction of shale gas.
• Large-scale development of areas of peat or

vegetation with a high CO2 content for agricultural purposes.

• Production and maintenance of weapons of

mass destruction, such as chemical weapons, biological weapons, cluster bombs or landmines that target people.

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Our business portfolio and carbon related credit exposures

• We are measuring the carbon

footprint of our business portfolio, including the following areas: Shippi ping/M ng/Marin arine industr strie ies, s, Renewable able energy gy producti ction

• n and

Property/ ty/Constr Constructi uction

• n. This is 70%
• f our portofolio.
• We see this as essential insight in
• rder to be able to understand the

climate risk as well as new green business opportunities.

SPAREBANKEN VEST

Sectors MNOK %

Property 19 254 39 % Shipping 4 477 9 % Fishery and fish industry 4 171 8 % Property and Construction 3 606 7 % Merchandise 2 920 6 % Renewable energy and small scale hydropower 2 002 4 % Agriculture and Forestry 1 640 3 % Industry 2 253 5 % Offshore 1 286 3 % Fish farming 1 184 2 % Land based transport 775 2 % Hotels and restaurants 738 1 % Yard industry 146 0 % Others 5 032 10 % Total 49 483 100 %

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Sparebanken Vest Green Mortgage Loan

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What is a green en mortgage? gage? Green mortgage loans provides extra favourable loan interest if you have a property in energy class A or B. What does es it mean n that the home e has ener ergy gy class A or B? Energy class A means that the dwelling has a heat pump or solar energy. In addition, it has better insulation in windows and walls. A passive house is also within energy class A. Energy class B is a property with a heat pump or solar energy with highly insulated walls and windows.

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Sparebanken Vest ESG Ratings

SPAREBANKEN VEST

73% Outperformer Renewing in process

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Sparebanken Vest Green Bond Framework

SPAREBANKEN VEST

Sparebanken Vest Green Bond Framework

SPAREBANKEN VEST

Use e of proc

• ceed

eeds:

New and existing mortgages for energy efficient residential and commercial buildings in Norway and loans to Renewable Energy.

Proces cess for Project ject Evalua luation ion and Selec ection: ion:

A dedicated Green Bond Committee has been established. Building years are used as a proxy to select eligible green buildings.

Mana nageme gement nt of proceed ceeds:

The Green Bonds proceeds will be managed by Sparebanken Vest in a portfolio approach.

Report

• rting:

ing:

Sparebanken Vest intends to show the allocation and impact

• f the green bond proceeds at the category level and on an

aggregated basis for all of Sparebanken Vest’s green bonds and other potential green funding outstanding.

Exter ernal nal Review ew

Sustainalytics has provided a Second-Party Opinion on Sparebanken Vest’s Green Bond Framework.

Rationa nale

✓ Offer sustainable investment

• pportunities.

✓ Allow current and new investors to support making a positive impact. Inves estors

• rs

Issuer uer Impact ct ✓ Contribute to the UN Sustainable Development Goals and to the development of the Green Bonds Market. ✓ Alignment with Sparebanken Vest CSR Strategy. ✓ Access to a more diversified investor base.

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Green Bond Framework - Structure Overview

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Hydropower Green Buildings Green Senior Bonds

• Loans to finance or refinance new or

existi ting g energy gy efficient t commerc ercial ial and residen enti tial buildings in Norway. EU Environ ironmenta mental Objecti tive: Substantial contribution to Climate Change Mitigation (1.b). New Buildings belonging to the top 15% most energy-efficient buildings of the local building stock and refurbished buildings which achieved energy savings of at least 30% in comparison to the baseline performance of the building before the renovation.

• Hydro power

power in in Nor

• rwa

way, y, limi mite ted dir irect ect emiss ssion

• ns of
• f less than 100

100g CO CO2e / KWh.

• Run-of-river, small scale hydro power

plants (maximum generation capacity < 20MW).

• Refurbishment or refinancing of existing

medium or large hydropower plants. EU Environ ironmenta mental Objecti tive: Substantial contribution to Climate Change Mitigation (1.a).

Green Buildings Green Covered Bonds

• Loans to finance or refinance new or

existi ting g energy gy efficient t resid iden enti tial buildings in Norway. EU Environ ironmenta mental Objecti tive: Substantial contribution to Climate Change Mitigation (1.b). New Residential Buildings belonging to the top 15% most energy-efficient buildings of the local building stock and refurbished buildings which achieved energy savings of at least 30% in comparison to the baseline performance of the building before the renovation.

Green een Bond nd Framework mework

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Use of Proceeds - Green Buildings

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Elig igib ible le Gree een Build ldin ings gs portf tfol

• lio

io

Area Reduced energy compared to baseline Reduce CO2 emissions compared to baseline Residential Buildings 1,55 million m2 207 GWh/ year EU28 + Norway 25 000 tons CO2/ year Low 6 500 tons Commercial Buildings 144 787 m2 16 GWh/ year EU28 + Norway 2 000 tons CO2/ year Low 500 tons CO2/ year Total 1,69 million m2 223 GWh/ year EU28 + Norway 27 000 tons CO2/ year Low 7 000 tons CO2/ year Area per unit [m2] Area total [m2] Residential Buildings 499 1 550 000 Commercial Buildings 127 144 787 Total 626 1 694 787

27 000 tons CO CO2 emis issions ions avoid ided

Elig igib ible le criteria teria

Resi siden dential buildings 1. New or existing residential buildings in Norway that comply with the following codes (built after 2009)

• Apartments: TEK10 or TEK17
• Other residentials dwellings: TEK07, TEK10 or TEK17.

2. Existing Norwegian residential buildings built using older building codes than TEK10 for apartments and TEK07 for other residential dwellings with EPC-labels A, B and C (built before 2009). 3. Refurbished Residential buildings in Norway with an improved energy efficiency of 30%. Com

• mmer

ercial buildings gs 1. New or existing commercial buildings belonging to top 15% low carbon buildings in Norway. 2. New, existing or refurbished commercial buildings which received at least one or more of the following classifications:

• LEED “Gold“, BREEAM or BREEAM-NOR “Excellent”, or

equivalent or higher level of certification

• Nordic Swan Ecolabel.

3. Refurbished Commercial buildings in Norway with an improved energy efficiency of 30%.

Impact ct Report

• rt

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Use of Proceeds – Hydropower

SPAREBANKEN VEST Capacity [MW] Expected production [GWh/yr] Small run of river 0,1 - 25 578 Medium sized HPP 30 – 90* 141 Total 719 Produced power compared to baseline Reduced CO2 emissions compared to baseline Eligible hydropower plants in portfolio 719 GWh/year 93 000 tons CO2/year

Eligi igible le Hydropow

• power

er portfolio lio Impact ct Report

• rt

719 719 GWh produc uced ed per per year 93 000 tons C0 C02 emissions ns avoided ed per per year

Eligi igible le criter eria ia

Hydropo

• powe

wer Hydro power in Norway, limited direct emissions of less than 100g CO2e / KWh:

• Run-of-river, small scale hydro power plants (maximum

generation capacity < 20MW).

• Refurbishment or refinancing of existing medium or large

hydropower plants.

*Medium sized existing power station with a reservoir in existing waterway that has been in operation for more than 35 to 50 years. Power density is even for these stations larger than 10 W/m2.

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Process for Project Evaluation and Selection

SPAREBANKEN VEST

• All customers must comply with the laws and

agreements that apply in Norway and the countries where the customers are present.

• Sparebanken Vest shall not grant financing to

customers/businesses that: I. Sparebanken Vest has reason to believe do not comply with the bank’s Code of Ethics or with the generally accepted view of what constitutes ethical conduct. II. have acted dishonestly in relation to the bank

• r are known to have acted dishonestly in

relation to other parties, or if the company or its owners are known to have been involved in criminal activity.

• III. operate in conflict with laws, regulations and
• fficial environmental requirements.
• IV. are included on Norges Bank’s list of excluded

companies.

Screening

• Projects financed and/or refinanced through the

Green Bond proceeds are evaluated and selected based on compliance with the Eligibility Criteria.

• For the category Green Buildings, Sparebanken

Vest has relied on the support of an external real estate consultant Multiconsult to: I. define the associated eligibility criteria for the top 15% of low carbon buildings. II. identify the buildings that comply with these criteria within Sparebanken Vest’s existing portfolio of real estate.

• For the category Renewable Energy, Sparebanken

Vest only finances 100% hydropower, with a limited direct emissions of less than 100g CO2e / KWh.

Eligibility

• A dedicated Green Bond Committee has been

established to create this Green Bond Framework.

• The committee consists of the Head of

Sustainability and senior officials within Sparebanken Vest’s credit, funding, risk management and corporate lending teams.

• The committee will manage any future updates to

the Framework, including expansions to the list of Eligible Categories, and oversee its implementation.

• For newly originated loans, the Green bond

Committee will oversee the process for the evaluation and selection of Eligible Green Loans according to the methodology defined.

Green bond committee

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Management of Proceeds

SPAREBANKEN VEST

✓ Eligible Green Projects are aligned with the draft EU Taxonomy and the Sparebanken Vest Green Bond Framework follows the TEG recommendation

• n the EU Green Bond Standards

✓ The Green Bonds proceeds will be managed by Sparebanken Vest and Sparebanken Vest Boligkreditt in a portfolio approach. ✓ Sparebanken Vest will ensure that the level of allocation for the Eligible Green Loan Portfolio matches or exceeds the balance of net proceeds from its outstanding Green Bonds. ✓ For Green Covered Bonds, Sparebanken Vest Boligkreditt will ensure that there are enough Eligible Green Mortgages within the cover pool relative to green covered bonds outstanding. ✓ The Green Bond Committee will ensure ongoing compliance with the eligibility criteria. Eligible Green Mortgages In the cover pool of Sparebanken Vest Boligkreditt Green Covered Bonds Outstanding Eligible Green Projects in Sparebanken Vest (parent bank) Green Bonds Outstanding

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Reporting

SPAREBANKEN VEST

✓ Sparebanken Vest intends to make and keep readily available green bond reporting after a year from issuance, to be renewed annually until all bonds are pain in full. ✓ Sparebanken Vest has appointed green real estate and renewable energy consultant Multiconsult to develop the methodology for the estimation and calculation of the impacts. The impact report will be provided on a portfolio basis.

Allocation location Repor

• rti

ting Impa mpact t Repor

• rting

ing Green Buildings Hydropower

• Estimated ex-ante annual energy consumption

in KWh/m2 or energy savings in MWh

• Estimated annual reduced and/or avoided in

tons of CO2 equivalent

• Total installed capacity in MWh
• Estimated annual avoided emissions in tons of

CO2 equivalent

✓ The bank intends to show the allocation and impact

• f the green bond proceeds to the Eligible Green

Loan Portfolio at least at the category level and on an aggregated basis. ✓ Both allocation report and impact report will be made available via Sparebanken Vest’s website.

✓ The total amount of proceeds allocated to eligible loans ✓ The number of eligible loans ✓ The balance of unallocated proceeds ✓ The amount or the percentage of new financing and refinancing ✓ The geographical distribution of the assets (at country level)

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Overview of the portfolio

SPAREBANKEN VEST

18 billion NOK Residential buildings 2 billion NOK Commercial buildings 2 billion NOK Hydropower 22 billion NOK

Alre ready dy qualif ifie ied

Green Mortgages Industry specific requirements and credit policy

Green covered bonds Green senior bonds

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• Sustainalytics considers that offering mortgages for energy efficiency

residential buildings, as well as lending to green buildings and hydroelectric projects, will lead to positive environmental impacts and advance the UN Sustainable Development Goals, in particular Goals 7, 9, and 11.

External Review - SPO

SPAREBANKEN VEST

Use Use of

• f proc
• ceed

eeds:

• Sparebanken Vest has established a green bond committee, led by the

Head of Sustainability and consisting of representatives from relevant departments, to select eligible loans for inclusion in its green portfolio. This is in line with market practice. Project ject Evalua luation ion / Selection ection

• Sparebanken Vest will manage the proceeds of its green bond using a

portfolio approach, with distinct portfolios for covered and senior bonds, and ensure over time that the value of its portfolio matches the outstanding balance of green bonds. Unallocated proceeds may be held in the Bank’s treasury liquidity portfolio. This is in line with market practice. Mana nageme gement nt of

• f Proceed

ceeds:

• Sparebanken Vest will report annually on allocation and impact, on a

portfolio basis. Allocation reporting will include information on the total amount allocated and the number of loans financed, while impact reporting will include relevant quantitative metrics, calculated using a methodology developed by a specialist third-party consultant. This is in line with market practice. Report

• rting

ing:

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