Macroeconomic Data and Banking System in North Macedonia

Macroeconomic data and the Banking system of the Republic of North Macedonia September 30, 2022

Macroeconomic Environment Key economic indicators 2019 2020 2021 1Q 2022 2Q 2022 3Q 2022 Industrial production volume index 3.7 % -9,5 % 1,4 % 3.5 % 2.5 % 0,9 % Industrial production volume index 100.9 annual External Trade (%) total import 10.0 -9.7 26.8 29.4 28.7 29.1 Trade Import amounts 554 574 Mio. DEN, increased 29,1 % annual, Export amounts 379 441 Mio. DEN, increased 20,1% annual, External Trade (%) total export 9.5 -9.9 19.7 16.8 20.3 20.1 Real GDP growth (%) 3,90 -6,1 4,0 2,4 2,8 2,0 Central Government Budget surplus/deficit (% GDP) -2.1 -8.1 -5.4 -0.8 -0,4 Inflation (CPI%) 0.8 1.2 3,2 7,7 10,0 12,4 GDP growth 2.0% Current Account Bal. (EUR'm) -368,3 -366,0 -415,7 -393,3 -235,19 Inflation 12,4% Gross External Debt (EUR'm) 8,154.4 8,536.1 9576.6 9994 10.379 11,077.3 FX Reserves (EUR'm) 3,262.60 3359,87 3643,28 3272,54 3116.11 3.753,78 FX Reserves 3.753,78 Mio.EUR Foreign direct invest. (EUR'm) 363.3 154.7 435.2 107.5 138,8 213,8 Unemployment(%) 17,30 16,40 15,2 14,8 14,5 14,3 Reference rate 2% MKD/EUR 61.51 61.69 61.63 61,69 61,69 61,49 Labour Market Rate of unemployment 14,3 % The credit rating of the state: Source : NBRM BASIC ECONOMIC INDICATORS FOR REPUBLIC OF NORTH MACEDONIA Rating 'BB-/B' Ratings Affirmed; Outlook Stable Standard & Poor s Source : www.spglobal.com/standard-poor-s-ratings-ratingsdirect August 20, 2022)

Macedonian Banking sector: Assets state owned 4% annual change (%) quarterly change (%) in millions of denars 09/2021 12/2021 03/2022 06/2022 09/2022 Greece 25% domestic shareholders 20% Total assets of the Banking system 608,595 638,666 635,968 643,906 657,256 8.00% 2.07% Loans 371,861 383,627 393,812 404,440 411,696 10.71% 1.79% Deposits 451,675 468,844 454,700 455,635 469,603 3.97% 3.07% Switzerland 1% Capital & reserves 75,257 73,779 76,626 79,655 82,731 9.93% 3.86% Bulgaria 6% ASSETS FOREIGN CAPITAL-PARTICIPATION 76.29% Slovenia 16% 75.41% 75.37% 657,256 643,906 74.36% 638,666 635,968 72.89% Turkey 14% 608,595 Germany 4% Austria 10% 09/2021 12/2021 03/2022 06/2022 09/2022 2017 2018 2019 2020 2021 Financial intermediation Financial intermediation The Banking sector consists of 13 active banks, 5 large (amounts 534.648 Mio. Den.) 81% in total assets, 5 medium (amounts 103.001 Mio. Den.) 16% in total assets, 3 small (amounts 19.607 Mio. DEN) 3% in total assets and 2 saving houses. Participation of foreign capital 76,29% Total assets of the Banking system registered the amount of 657.256 Mio. Den., increased by 8 % annual and 2.07 % quarterly, which is 88.7 87.6 86.4 85.5 83.2 65.1 supported by the growth of the deposit 3.97 % annual and 3.07 % quarterly and the capital position of the banks which increased by 9.93 % annual, 63.5 62.6 61.7 58.9 3.86 % quarterly. Total loans increased by 10.71 % annual, 1.79 % quarterly. 54.2 53.3 54.1 52.2 52.2 The level of financial intermediation measured by: he ratio of total assets and GDP is 86,4 % which indicates the dominant position of banks in the financial system Total deposits from non-financial sector/GDP is 61.7% Total gross loans to non-financial sector/GDP is 54.1% 52.0 09/2021 12/2021 03/2022 06/2022 09/2022 Financial intermediation Total assets/GDP/ Financial intermediation Total deposits from non-financial sector/GDP/ Financial intermediation Total gross loans to non-financial sector/GDP/ Source NBRSM, Department for financial stability, Last revision to GDP figures (at current prices): 02.12.2022.

Macedonian Banking sector: Structure of assets and managing the Liquidity risk Asset structure Liquid assets /total assets Other assets 8% Highly liquid assets 29 % 33.0 32.4 31.6 32.0 31.0 30.11 30.0 28.82 28.77 29.0 Total credit exposure 63 % 28.0 27.0 26.0 09/2021 12/2021 03/2022 06/2022 09/2022 Loans/Total assets participates by 62,64 % while the rest of 8 % is other assets. In structure of total assets highly liquid assets participates by 29%*, total credit exposure 63.50% 62.81% 62.64% 63.00% (100%) and it confirm the satisfactory volume of liquidity at its disposal the Macedonian banking System. Liquidity Coverage Ratio is 258,9%, which is three times higher than the regulatory minimum 62.50% 61.92% 62.00% 61.50% 61.10% liabilities with liquid assets remained stable of 45,9% refers to appropriate liquidity risk management by the banks. Stable share of liquid assets in total assets of banking system and coverage of short-term 61.00% 60.50% 60.07% 60.00% 59.50% Source: REPORT ON RISKS IN THE BANKING SYSTEM OF THE REPUBLIC OF MACEDONIA , Indicators on the banking system 59.00% Liquid assets: cash,treasury bills, government bonds Non-financial sub.: state, non-financial companies, households, nonprofit ins. and nonresidents 58.50% 09/2021 12/2021 03/2022 06/2022 09/2022

Macedonian Banking sector: Loans Loans - households Credit portfolio Credit portfolio LOANS 53.00% Car loans 0,15% 51.88% 411,696 51.13% 52.00% 404,440 50.66% 50.66% 50.57% 51.00% 393,812 50.00% real estate loans 33 % 49.00% 383,627 48.00% 48.42% 48.38% 371,861 47.96% 47.87% 47.00% Credit cards & consumer loans 66 % 47.08% 46.00% 45.00% 44.00% 09/2021 12/2021 03/2022 06/2022 09/2022 09/2021 12/2021 03/2022 06/2022 09/2022 Non.fin.com Loans - households in millions of denars annual change (%) quarterly change (%) Total loans amounts 411.696 Mio. DEN. prevail households 51%, increased by 6,66% annual or 1,26% quarterly. Households' loans: consumer loans and credit cards increased by 4,28% annual or 0,70% quarterly. housing loans, increased by 12,95% annual or 2.45% quarterly. car loans increased by 35.01% annual or 45.58 % quarterly. Our banks have also paid attention to raising awareness about green loans as a form of financing that enables borrowers to invest exclusively in projects that make a substantial environmental impact, including climate-related projects, improve the energy efficiency, support investments in green technologies, materials and solutions, support investments in renewable energy sources, control and prevention of pollution and protection of the environment. Loans - households 09/2021 12/2021 03/2022 06/2022 09/2022 Consumer loans and credit cards 142,649 144,213 144,773 147,721 148,748 4.28% 0.70% Car loans 248 242 233 230 335 35.01% 45.58% Housing loans 65,679 67,984 70,121 72,409 74,182 12.95% 2.45% Green Loans - households amount 1.382 Mio.DEN, 0,7% in total Loans to households' * According to World Bank other 4,053 3,802 3,646 3,607 3,535 -12.78% -2.00% Total 212,630 216,241 218,772 223,967 226,800 Green loans 1,844 1,315 6.66% 1.26% 1,346 1,373 1,382 -25.05% 0.65% Weighted interest rates on granted loans INTEREST RATES ON TOTAL GRANTED LOANS (Denar and foreign currency) 09/2021 12/2021 03/2022 06/2022 09/2022 4.46 4.37 4.30 4.27 4,35

Macedonian Banking sector: Loans Loan concentration by economic activity Loans of non participate with participate with48% annual, and 0,39% quarterly Loans structure structureby economic activity of by economic activity of non non- -financial companies financial companies : non- -financial companies financial companies 48%, , increased by 9,55 increased by 9,55% % Our banks have also paid attention to raising awareness about green loans as a form of financing that enables borrowers to invest exclusively in projects that make a substantial environmental impact, including climate-related projects, improve the energy efficiency, support investments in green technologies, materials and solutions, support investments in renewable energy sources, control and prevention of pollution and protection of the environment. Other Transport and storage Trade 30%, increased by 6,30% annual or 0.52% quarterly Trade Electricity, gas, steam and air conditioning supply Industry 22%, increased by 8,33% annual or reduced by (-1.29%) quarterly Construction Green Loans of non-financial com. amount 11.494 Mio.DEN 5,8% in total Loans of non- financial companies According to World Bank Construction 16%, increased by 12,60% annual or 1.01% quarterly Industry - 20,000 40,000 60,000 80,000 09.2022 06.2022 03.2022 12.2021 09.2021 in millions of denars annual change (%) quarterly change (%) Loan concentration by economic activity -non- financial companies 09/2021 51,550 35,629 12/2021 52,722 38,192 03/2022 57,391 40,039 06/2022 56,570 39,717 09/2022 55,843 40,117 8.33% 12.60% -1.29% 1.01% Industry Construction Electricity, gas, steam and air conditioning 15,772 67.22% 12.51% supply Trade 9,432 72,758 15,426 48,203 10,277 76,884 15,998 49,694 11,660 75,540 14,644 52,309 14,018 76,939 15,222 51,800 77,340 15,883 50,294 6.30% 2.96% 4.34% 0.52% 4.34% -2.91% Transport and storage Other 9.55% 0.39% Total 232,998 243,768 251,584 254,265 255,249 Green loans 53.60% 20.16% 7,483 9,233 9,454 9,565 11,494

Macedonian Banking sector: Loans Rate of non-performing loans 3.55% 3.60% 3.50% 3.40% 3.31% annual change (%) quarterly change (%) 3.24% 3.23% 3.30% - 0,24 0,07 Non-performing loans / Total loans 3.20% 3.09% 3.10% Rate of non-performing loans (non-financial companies) 2,33 1,65 3.00% 2.90% 2.80% 09/2021 12/2021 03/2022 06/2022 09/2022 NPL Coverage 68.00% 67.61% Rate of non-performing loans 3,31%, reduced by (-0,24) pp annual and increased by 0,07 pp quarterly. 67.50% 67.00% 66.44% 66.28% NPL Coverage - Coverage of non-performing loans with impairment (non-financial companies) 67.61% increased by 2.33 pp annual or 1.65 pp quarterly 66.50% 65.97% 66.00% 65.28% 65.50% 65.00% 64.50% 64.00% 09/2021 12/2021 03/2022 06/2022 09/2022

Macedonian Banking sector: Liabilitys structure LIABILITIE S LIABILITIE S STRUCTURE STRUCTURE annual change (%) quarterly change (%) Liability's structure 09/2021 12/2021 03/2022 06/2022 09/2022 100% 13% 15% 16% 16% 17% 90% 12% 80% 12% 13% 12% 12% 70% Deposits' 451,675 468,844 454,700 455,635 469,603 3.97% 3.07% 60% 50% Capital & reserves 75,257 73,779 76,626 79,655 82.730 9.93% 3.86% 40% 74% 73% 71% 71% 71% 30% Other liabilities 81,663 96,043 104,642 108,616 104,923 28.48% -3.40% 20% 608,595 638,666 635,968 643,906 657,256 8.00% 2.07% Total 10% 0% in millions of denars 09/2021 12/2022 03/2022 06/2022 09/2022 Deposits' Capital & reserves Other liabilities Capital adequacy ratio Capital adequacy ratio 17.80% participate by 71%, regarding previous year are increased by 3.97% or 3.07% quarterly. In the structure of liabilities, the deposits amount 469.603 Mio. DEN are dominant that 17.71% 17.60% or 3,86% quarterly. 17.40% Capital & reserves amount 82.730 Mio. DEN., participate with 12 %, increased by 9.93% annual, 17.3% 17.20% 17.30% 17.26% or 0.42% quarterly and likewise indicates on the capacity and coverage of the risks from Banks activity as well as stabile level on Banking sector solvency Capital adequacy ratio is 17,71 % and regarding previous year is increased by 0,45 pp annual, 17.00% 17.0% 16.80% 16.60% 09/2021 12/2021 03/2022 06/2022 09/2022

Macedonian Banking sector: Deposits Participation of subjects Structure of Deposits: 100% Deposits from households participate with 68%, increased by 5,39 % annual and 1.86 % quarterly, 90% 80% Nonfinancial corporations participate with 29%, increased by 0.45 % annual and 5.99% quarterly. 70% 60% 50% 40% 30% Deposits structure Deposits structure 20% 500,000.0 10% 450,000.0 0% 400,000.0 09/2021 12/2021 03/2022 06/2022 09/2022 350,000.0 Households 67% 66% 67% 68% 68% 300,000.0 Non.fin.com 30% 30% 29% 28% 29% 250,000.0 200,000.0 150,000.0 100,000.0 50,000.0 annual change (%) quarterly change (%) - 09/2021 12/2021 03/2022 06/2022 09/2022 0.45% 5.39% 5.99% 1.86% Non.fin.com 134,128.2 142,478.4 131,824.8 127,118.8 134,734.5 Households 301,336.6 309,051.2 305,135.4 311,774.2 317,585.7 Deposits structure 451,675.2 468,844.2 454,700.4 455,634.7 469,603.0 3.97% 3.07% Household's annual5.39% Weighted interest rates on received deposits 09/2021 12/2021 03/2022 06/2022 09/2022 Total deposits annual3.97% INTEREST RATES ON TOTAL RECEIVED DEPOSITS (Denar and foreign currency) 0.78 0.74 0.70 0.67 0,70

Macedonian Banking sector: Profitability Cost Cost- -to to- -income income ratio ratio Return on average equity (ROAE) Return on average assets (ROAA) 47.89% 09/2022 13.72% 09/2022 1.66% 09/2022 48.04% 06/2022 14.30% 06/2022 1.71% 06/2022 13.96% 03/2022 1.65% 03/2022 50.4% 03/2022 1.49% 12.89% 12/2021 12/2021 47.4% 12/2021 1.61% 09/2021 13.43% 09/2021 46.89% 09/2021 1.37% 1.42% 1.47% 1.52% 1.57% 1.62% 1.67% 1.72% 12.00% 12.50% 13.00% 13.50% 14.00% 14.50% 45.00% 46.00% 47.00% 48.00% 49.00% 50.00% 51.00% Banking sector has stabile rates of profitability measured by : Return on average asset (ROAA) 1,66%, increased by 0,04 pp annual, reduced by (-0,05) pp quarterly. Return on average equity (ROAE) 13,72%, increased by 0.29 pp annual or reduced by (-0.58) pp quarterly. 47,89 % of total income cover operating costs of the Banks 61.90% of total income is net interest income Net interest income Net interest income/ / total income total income 62.58% 63.00% 61.90% 62.00% 60.99% 61.00% 60.51% annual change (pp) quarterly change (pp) Profitability 60.00% 59.35% Return on average assets (ROAA) Return on average equity (ROAE) 0.04 -0.05 59.00% 0.29 -0.58 58.00% Cost-to-income ratio 1.00 -0.15 57.00% 09/2021 12/2021 03/2022 06/2022 09/2022 Net interest income / total income 1.39 0.92