Artea bankas (ROE1L) Investor Update summary

Dividend policy and capital return strategy

• Announced a new dividend policy with a minimum payout of 50% of the previous year's net earnings, up from the prior 25%, with share buybacks as an alternative or supplement under certain conditions.

• Dividend payments are contingent on meeting all regulatory capital and liquidity requirements, and capital levels must remain sufficient for investments and development.

• Any deviation from the minimum payout will be explained to shareholders before approval, with policy changes requiring Supervisory Council approval and final decisions made by the General Meeting of Shareholders.

Share buyback program

• Planned tender offer for €5 million in October, followed by open market buybacks of €5–6 million, targeting up to 25% of daily trading volume.

• ECB approved repurchase of up to 13,745,114 shares, including €10 million for capital reduction and €1.5 million for employee remuneration.

• Buybacks aim to reduce valuation discount, improve per share metrics, boost liquidity, and provide reliable exit options for investors.

• Buybacks will be executed under market abuse regulations and use a Dutch auction for the tender offer.

Capital position and funding

• Recent successful placements of subordinated debt, Eurobonds, and €300 million senior preferred notes have improved capital efficiency and supported funding structure and MREL targets.

• Plans to issue €50 million in Additional Tier 1 bonds in 2024/25 and another subordinated bond in 2025.

• These actions support organic growth, high shareholder distributions, and sufficient capital for growth and distributions.