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Correction: Bigbank Unaudited Financial Results for Q3 and Nine Months of 2022

Teade

Bigbank  AS is correcting the contents of its previously released stock exchange
announcement  "Bigbank Unaudited Financial  Results for 2022 Q3  and Nine Months
(https://view.news.eu.nasdaq.com/view?id=beaf1f676684355eb88169a64db999092&lang=
en)"   and  the  Bigbank  Interim  report  Q3  2022 that  was  attached  to  the
announcement.  The contents of the stock  exchange announcement and the Q3 2022
interim  report were  revised in  connection with  the corrections made during a
review  of  the  financial  statements  performed  by  the company's independent
auditor.

 1. The accounting policies for contract fees and the costs directly
    attributable to obtaining contracts were corrected. After the correction,
    contract fees are recognised using the effective interest method as
    appropriate for interest-like revenue and the costs directly attributable to
    obtaining contracts are capitalised and amortised over the terms of the
    underlying contracts. As a result of the correction, retained earnings and
    loans to customers as at 31 December 2021 were reduced by 2.8 million euros.
    Interest income and loans to customers as at and for the period ended 30
    September 2022 were corrected by 0.5 million euros.
 2. Additionally, the accounting for loans with an investment risk component
    that have the features of a hybrid financial instrument was corrected.
    Before the correction, the gains arising from changes in the values of the
    underlying assets of relevant contracts were immediately recognised as
    interest income and the discounted amount was recognised as interest
    expense. Subsequent to the correction, the contracts were reclassified and
    the gains are recognised on a straight-line basis over the lives of the
    contracts as gains on financial assets measured at fair value through profit
    or loss. Due to the correction, Bigbank's profit for the nine months of
    2022 decreased by 6.6 million euros.

The  above  corrections  have  been  made  to  both the income statement and the
statement of financial position included in this stock exchange announcement and
the Q3 2022 interim report.

Bigbank  earned a net profit of 7.2 million euros in the third quarter and a net
profit  of  21.3 million  euros  in  the  nine  months  of 2022. Performance met
expectations,  although both the  profits for nine  months and the third quarter
were  lower than  a year  earlier (-40.8% and  -7.8%, respectively).  Last year,
Bigbank earned a one-off bargain purchase gain on a business combination and the
increase in the fair value of investment property was 2.5 million euros larger.

Third  quarter net  interest income  grew by  2.8 million euros  (15.2%) year on
year,  amounting to 21.3 million euros. Profit before loss allowances and income
tax  was 13.3 million euros. Expenses on credit loss allowances amounted to 4.2
million euros.

Bigbank's  loan portfolio grew, expanding in the nine months by 38.6% and in the
third  quarter by 11.9%. At the end of the third quarter, the Group's performing
loan portfolio amounted to 1.2 billion euros, exceeding the 2021 year-end figure
by  350.8 million  euros  (39.5%).  The  share  of  loans  over 90 days past due
accounted for 1.3% of the total portfolio, indicating a continued improvement of
the  quality of the portfolio over the year,  as the same indicator for the nine
months of 2021was 3.0%.

The  third  quarter  profit  of  the  corporate banking segment amounted to 2.6
million  euros, an  increase of  0.7 million euros  on the previous quarter. The
quarterly   profit  figure  includes  net  gain  of  0.2 million  euros  on  the
revaluation of the underlying assets of loans with an investment risk component,
which  is recognised on a  straight-line basis over the  terms of the underlying
loan contracts. Revaluation gains on loans with an investment risk component are
calculated  annually,  based  on  movements  in  the  market value of customers'
investment property and the agreed pattern of profit sharing. The corporate loan
portfolio grew by 68.7 million euros (20.0%) during the quarter.

The  housing loan  portfolio grew  by 27.7% to  186.9 million euros in the third
quarter. Compared with the end of 2021, the portfolio has increased by more than
1.5 times.

Deposits  from customers  increased by  38.6% in nine  months and by 6.5% in the
third  quarter. The  fastest growth  was again  shown by savings deposits, which
increased  by 10.7% to 542.5 million euros in  the third quarter, accounting for
43.6% of the deposit portfolio at the end of the quarter.

The Group's investment property portfolio, which includes both agricultural land
and  commercial  real  estate,  grew  to  47.4 million  euros  by the end of the
quarter.

+------------------------+------------------+-------+------------------+-------+
|Income statement, in    |                  |       |                  |       |
|thousands of euros      |Q3 2022 (Restated)|Q3 2022|9M 2022 (Restated)|9M 2022|
+------------------------+------------------+-------+------------------+-------+
|Net interest income     |            21 308| 28 627|            61 045| 68 364|
+------------------------+------------------+-------+------------------+-------+
|Net fee and commission  |                  |       |                  |       |
|income                  |             1 891|  1 891|             5 511|  5 511|
+------------------------+------------------+-------+------------------+-------+
|Net income (loss) on    |                  |       |                  |       |
|financial assets        |                51|   -161|              -252|   -464|
+------------------------+------------------+-------+------------------+-------+
|Net other operating     |                  |       |                  |       |
|income                  |               171|    170|               244|    243|
+------------------------+------------------+-------+------------------+-------+
|Total net operating     |                  |       |                  |       |
|income                  |            23 421| 30 527|            66 548| 73 654|
+------------------------+------------------+-------+------------------+-------+
|Salaries and associated |                  |       |                  |       |
|charges                 |            -5 279| -5 279|           -15 787|-15 787|
+------------------------+------------------+-------+------------------+-------+
|Administrative expenses |            -4 586| -4 586|           -12 723|-12 723|
+------------------------+------------------+-------+------------------+-------+
|Depreciation,           |                  |       |                  |       |
|amortisation and        |                  |       |                  |       |
|impairment              |            -1 034| -1 034|            -3 003| -3 003|
+------------------------+------------------+-------+------------------+-------+
|Other gains (losses)    |               804|    804|               673|    673|
+------------------------+------------------+-------+------------------+-------+
|Total expenses          |           -10 095|-10 095|           -30 840|-30 840|
+------------------------+------------------+-------+------------------+-------+
|Profit before loss      |                  |       |                  |       |
|allowances              |            13 326| 20 432|            35 708| 42 814|
+------------------------+------------------+-------+------------------+-------+
|Net loss allowances on  |                  |       |                  |       |
|loans and financial     |                  |       |                  |       |
|investments             |            -4 186| -4 186|           -10 744|-10 744|
+------------------------+------------------+-------+------------------+-------+
|Profit before income tax|             9 140| 16 246|            24 964| 32 070|
+------------------------+------------------+-------+------------------+-------+
|Income tax expense      |            -1 946| -1 946|            -3 708| -3 708|
+------------------------+------------------+-------+------------------+-------+
|Profit for the period   |             7 194| 14 300|            21 256| 28 362|
+------------------------+------------------+-------+------------------+-------+



+-------------------+-----------------+-----------+----------------+-----------+
|Statement of       |                 |           |                |           |
|financial position,|                 |           |                |           |
|in thousands of    |     30 Sep 2022 |           |    31 Dec 2021 |           |
|euros              |       (Restated)|30 Sep 2022|      (Restated)|31 Dec 2021|
+-------------------+-----------------+-----------+----------------+-----------+
|Cash and cash      |                 |           |                |           |
|equivalents        |          141 163|    141 163|         115 948|    115 948|
+-------------------+-----------------+-----------+----------------+-----------+
|Debt securities    |           45 171|     45 171|          45 256|     45 256|
+-------------------+-----------------+-----------+----------------+-----------+
|Loans to customers |        1 248 194|  1 258 177|         893 463|    896 238|
+-------------------+-----------------+-----------+----------------+-----------+
|Other assets       |          103 357|    103 356|          93 686|     93 686|
+-------------------+-----------------+-----------+----------------+-----------+
|Total assets       |        1 537 885|  1 547 867|       1 148 353|  1 151 128|
+-------------------+-----------------+-----------+----------------+-----------+
|Customer deposits  |                 |           |                |           |
|and loans received |        1 281 161|  1 281 161|         934 840|    934 840|
+-------------------+-----------------+-----------+----------------+-----------+
|Subordinated notes |           40 049|     40 049|          14 976|     14 976|
+-------------------+-----------------+-----------+----------------+-----------+
|Other liabilities  |           17 521|     17 521|          15 191|     15 191|
+-------------------+-----------------+-----------+----------------+-----------+
|Total liabilities  |        1 338 731|  1 338 731|         965 007|    965 007|
+-------------------+-----------------+-----------+----------------+-----------+
|Equity             |          199 154|    209 136|         183 346|    186 121|
+-------------------+-----------------+-----------+----------------+-----------+
|Total liabilities  |                 |           |                |           |
|and equity         |        1 537 885|  1 547 867|       1 148 353|  1 151 128|
+-------------------+-----------------+-----------+----------------+-----------+



In  addition to regular  activities, several circumstances  had an impact on the
third quarter results and the Group's future business.

The  most important  event of  the period  was the  listing of Bigbank unsecured
subordinated  bonds on  the Nasdaq  Tallinn Stock  Exchange on 22 September. The
base  amount of  10 million euros  was more  than two  times oversubscribed. The
total size of the issue was 20 million euros. 20 thousand bonds were issued with
a  nominal value of  1,000 euros each, a  fixed annual coupon  rate of 8%, and a
maturity  of 10 years. The 20 million euros of additional capital helps the bank
sustain growth in the corporate banking and housing loan segments.

This  year  marks  the  beginning  of  Bigbank's new business strategy period of
2022-2026. In  order  to  support  the  new  business  strategy  and achieve the
expected  return  on  capital,  the  management  board  of  Bigbank  AS has made
decisions concerning the future operation of its Swedish and Bulgarian branches.
In August it was decided to suspend the issue of new loans at the Swedish branch
from  1 September 2022 and in October it was decided to suspend the issue of new
loans  at the  Bulgarian branch  from 1 November  2022. The Group  will continue
raising  deposits and servicing  its existing loan  portfolio in both Sweden and
Bulgaria.

Comments from Bigbank's Chairman of the Management Board Martin Länts:

"Despite the turbulent external environment, we have reason to be satisfied with
Bigbank's  third quarter financial performance - the period was characterised by
strong  growth  of  the  loan  portfolio,  continued  improvement  of the credit
portfolio and high profitability.

In  the third  quarter the  loan portfolio  showed the  strongest growth  in the
corporate and housing loan segments, which is one of the key goals of the bank's
business strategy. An increase in the sale of Euribor-linked loan products helps
us  diversify our portfolio and has a positive  impact on the bank's profit in a
situation  where interest rates are rising  and taking deposits is becoming more
expensive.

This summer the rating agency Moody's Investors Service completed the assessment
of  Bigbank and assigned the bank a long-term investment grade rating Baa3 and a
short-term  deposit  rating  Prime-3 to  its  foreign and domestic currency bank
deposits.  The investment grade rating that Moody's assigned to us, as disclosed
on  1 July 2022, provides assurance to our current depositors and partners about
Bigbank's  operating model as well as the  quality of our portfolio and supports
the financing of our further international expansion.

The  base volume of the  issue of unsecured subordinated  bonds in September was
more than two times oversubscribed. This was a landmark achievement for Bigbank,
indicating  that investors  have faith  in our  business strategy and ability to
successfully  implement it. I thank all the investors for placing their trust in
Bigbank".

The Bigbank financial statements can be found
at: https://investor.bigbank.eu/reporting/

Bigbank AS (www.bigbank.eu (http://www.bigbank.eu)) is an Estonian capital-based
bank  specialised in loans  and deposits for  private and business customers. In
addition  to operations  in Estonia,  the bank  has branches in Finland, Sweden,
Latvia,  Lithuania, and Bulgaria and  offers its products in  the form of cross-
border services also in Austria, Germany, and the Netherlands. Bigbank's balance
sheet total is more than 1.5 billion euros.

Argo Kiltsmann
Member of the Management Board
Phone: +372 5393 0833
E-mail: [email protected]
www.bigbank.ee
(https://www.globenewswire.com/Tracker?data=oW89uyL2BkD22UdGz1bj_7065KCdRt_B-
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