Articles of Association
Articles of Association
Entered in the Torino Company Register on 2 October 2026
INTESA SANPAOLO S.p.A.
Parent Company of the Intesa Sa npaolo Banking Group, included i n the National Register of Banking Groups - Registered office Torino, Piazza San Carlo n. 156 - Share Capital Euro 10, 529,394,196.28 - Registration number on the Torino Company Register and Fiscal Code 00799960158, VAT Number 108107 00152 - Member of the National Interbank Deposit Guarantee Fund and of the National Guarantee Fund, Incl uded in the National Regist er of Banks with no. 5361.
This is an English translation of the original Italian document . In cases of conflict between th e English language document an d the Italian document, the interpretation of the Italian language document prevails.
1
INTESA SANPAOLO S.p.A.
ARTICLES OF ASSOCIATION
TABLE OF CONTENTS
TITLE I CONSTITUTION, NAME, RE GISTERED OFFICE AND DURATION OF THE COMPA NY
Article 1. Name. Article 2. Registered office. Article 3. Duration.
TITLE II CORPORATE PURPOSE Article 4. Corporate purpose. TITLE III CAPITAL AND SHARES Article 5. Share capital. Article 6. Shareholders' address for service. TITLE IV SHAREHOLDERS’ MEETING Article 7. Shareholders' Meeting. Article 8. Calling of meetings. Article 9. Right to attend and vote in the Shareholders’ Meeti ng.
Article 10. Chair and conduct o f the Shareholders' Meeting. Se cretary.
Article 11. Validity of resolutions. TITLE V CORPORATE GOVERNANCE SYSTEM Article 12. One-tier governance system.
Article 13. Board of Directors and Management Control Committe e.
13.1. Composition. 13.2. Duration. 13.3. Integration.
2 13.4. Requirements for members of the Board of Directors.
13.5. Requirements for members of the Management Control Commit tee.
13.6. Loss of requirements. 13.7. Secretary of the Board of Directors. Article 14. Election of the Board of Directors. 14.1. Slates of candidates.
14.2. Voting. 14.3. Equality of ratio and ballot. 14.4. Supplementary mechanism. 14.5 Completion of composition 14.6. Single slate. 14.7. No slates. 14.8. Election of the Chair and Deputy Chairs.
Article 15. Termination from office. 15.1. Simul stabunt simul cadent. 15.2. Removal. 15.3. Replacements. Article 16. Reimbursement of expe nses, compensation and remuner ation for company offices.
16.1. Reimbursement of expenses.
16.2. Compensation of the membe rs of the Board of Directors.
16.3. Compensation of the members of the Management Control Com mittee.
16.4. Remuneration for particular offices.
Article 17. Meetings and resolut ions of the Board of Directors.
17.1. Calling of meetings. 17.2. Frequency. 17.3. Calling request. 17.4. Place. 17.5. Notice of call. 17.6. Meetings. 17.7. Assistance at meetings. 17.8. Validity and majority. 17.9. Resolutions with qualified majorities. 17.10. Interests of Directors. 17.11. Board regulations. Article 18. Powers of the Board of Directors.
18.1. Duties of the Board of Directors. 18.2. Powers which sha ll not be delegated.
18.3. Specific offices.
3 18.4. Subsidised and special lending.
Article 19. Chair of th e Board of Directors.
19.1. Powers. 19.2. Supplementary powers in urgent cases. 19.3. Deputy Chairs.
Article 20. Managing Director.
20.1. Appointment and powers. 20.2. Functions. 20.3. Reporting.
Article 21. Manager responsible for preparing the Company’s fin ancial reports.
Article 22. Representat ion. Signature powers.
22.1. Chair of the Board of Directors. 22.2. Managing Director. 22.3. Other parties.
Article 23. Management Control Committee.
23.1. Functions. 23.2. Organisation. 23.3. Relations with independe nt auditors and internal control managers.
23.4. Group coordination. 23.5. Powers of the Committee. Article 24. Mandatory board committees.
Article 25. Nomination Committee.
Article 26. Remuneration Committee. Article 27. Risks Committee.
Article 28. Other Committees.
TITLE VI FINANCIAL STATEMENTS - NET INCOME
Article 29. Financial sta tements and net income.
TITLE VII AUDITS OF ACCOUNTS – WITHDRAWAL – WINDING UP. APPLICATION OF OR DINARY REGULATIONS.
Article 30. Audits of accounts. Article 31. Withdrawal. Article 32. Winding up. Article 33. Application of ordinary regulations.
4 TITLE I
CONSTITUTION, NAME, REGISTERED OFFICE
AND DURATION OF THE COMPANY
Article 1. Name. 1.1.- The Company is incorporated under the name “Intesa Sanpaolo S.p .A.”, without any rest riction in the form of graphic presentation. In the use of brands and logos of the Company and the Group, the words that compose the name of the Company may be combined in a different manner. The Company may use, as brands and logos, names and/or brands used by itsel f and/or by the companies inco rporated therein.
1.2.- The Company is a Bank pursuant to the provisions laid down in L egislative Decree 385 of 1 September 1993.
Article 2. Registered office.
2.1.- T h e C o m p a n y h a s i t s r e g i s t e r e d o f f i c e i n T o r i n o a n d a s e c o n d a r y registered office in Milano. Central operations are divided between M ilano and Torino, provided, how ever, that in any case “Administration, Financial statements, Tax”, “Internal Audit” and “General Secre tariat” shall be in Torino .
2.2.- In accordance with the laws and regulations in force from time to time, the Compa ny may establish and wind up secondary registered offices, branches and representati ve offices, both in Italy and abroad .
Article 3. Duration.
The duration of the Company shall be until 31 December 2100 and may be extended.
TITLE II
CORPORATE PURPOSE
Article 4. Corporate purpose.
4.1.- The purpose of the Company is the deposit-taking and the carryi ng out of all forms of lending activities, both directly and through its s ubsidiaries. To this end, the Co mpany may, in compliance with laws and regulations in force from time to time and subject to being granted the req uired authorisations, directly and also through its subsidiaries, provide all bankin g and financial services, inclu ding the establishment and management of open-
end and closed-end pension schemes as well as carry out any oth er transactions that are instrumental for, or related to, the achievement of its corporate purpose .
5 4.2.- Acting in its capacity as Parent Company of the “Intesa Sanpaol o” banking group, pursuant to Article 61 of Legislative Decree 385 of 1 September 1993, the Company issues, in connection with its management and coordination capacity, instructions to the Group companies, inc luding with respect to the implementation of the instructions of the Supervisory A uthorities in the interest of the Group’s stability .
4.3.- The Company acts in the capacity of Parent Company of the finan cial conglomerate, pursuant to Article 3 of Legislative Decree 142 of 30 May 2005 .
TITLE III
CAPITAL AND SHARES
Article 5. Share capital.
5.1.- The Company’s subscribed and paid-in share capital amounts to 1 0,529,394,196.28 euro, represented by 17,682,460,955 ordinary shares without nominal value. 5.2.- The Extraordinary Shareholders' Meeting may resolve upon the al location of net income to the employees of the Company or of its subsidiaries by issuing financial inst ruments in accordance with the applicable legislation .
5.3.- The Extraordinary Shareholders' Meeting of 29 April 2022, whose resolutions were updated by the Extraordinary Shareholders' Meeting of 30 April 2026, granted t he Board of Directors (i) a power, pursuant to Article 2443 of the Italian Civil Code, to increase the share c apital free of charge, by 29 April 2027, also in several tranches, by a maximum of euro 230,000,0 00.00, through the issu e of a maximum number of 145,000,000 Intesa Sanpaolo ordinary shares, having the same features as those in circulation at the time of the issue, with regular dividend entitlement, to be assigned to the recipients of the L ong-term Incentive Plan 2022-2025 called "Performance Share Plan", at the conditions and in the terms an d ways provided for by the plan itself; all by assignment, pursuant to Article 2 349 of the Italian Civil Code, of a maximum amount of profits and/or profit reserves, as resulting from the latest pro tempore approved fin ancial statements, corresponding to the unstated nominal value of the issued shares at the time when the granted powers are exercised; and (ii) all the broadest powers to proceed with the precise identification of the profit s and/or profit reserves resulting from the latest pro tempore approved financial s tatements to be allocated for t he purpose referred to in point (i) above, with a mandate to carry out the appropriate accounting entries resulti ng from the issue transactions, in compliance with the provisions of law and th e accounting standards applica ble from time to time and to update this Article
5 accordingly
.
5.4.-The Extraordinary Shareholders’ Meeting of 30 April 2026 a pproved the annulment of a maximum of n.
800,000,000 Intesa Sanpaolo own shares, delegating the Board of Directors – with the option of sub-delegating the Chair and the Managing Director and CEO, acting jointly or severally – to execute said annulment, in one or
6 more tranches, by 23 October 2026 and to update this article 5 following the changes in the number of shares referred to in paragraph 1 and the completion of the annulment transactions.
5.5.- The Extraordinary Shareholders' Meeting of 30 April 2026 granted the Board of Directors (i) powers, pursuant to Article 2443 of the Italian Civil Code, to increase the share capital free of charge by 30 October 2027, also in several tranches, through the issue of a maximum number of 76,000,000 Intesa Sanpaolo ordinary shares, having the same features as those in circulation at the time of the issue, with regular dividend entitlement, to be allocated to the recipients of the Long-term Incentive Plan cal led "LECOIP 2026-2029" , at the conditions and in the terms and ways provided for by the plan itself; all by assi gnment, pursuant to Article 2349 of the Italian Civil Code, of the maximum amount of profits and/or profit reserves a s recorded in the latest pro tempore approved financial statements, corresponding to the unstated nominal val ue of the issued shares at the time when the granted powers are exercised; and (ii) all the broadest powers to proceed with the precise identification of the profits and/or profit reserves resulting from the latest pro te mpore approved financial statements to be allocated for the purpose referred to in point (i) above, with a mandate to carry out the appropriate accounting entries resulting from the issue transactions, in compliance with the p rovisions of law and the accounting standards applicable from time to time, and to update this Article 5 acco rdingly .
5.6.- Pursuant to Articles 2441, paragraph 8 and 2443 of the It alian Civil Code, the Extraordinary Shareholders' Meeting of 30 April 2026 granted the Board of Directors powers to increase the share capital for cash by 30 October 2027, for a maximum amount, including the share premium , of Euro 720,000,000, excluding option rights, in favor of employees who are recipients of the Long-te rm Incentive Plan called "LECOIP 2026-2029", in a divisible form, in one or more tr anches, by issue of a maximum of 170,000,000 Intesa Sanpaolo ordinary shares, having the same features as those in circulation at the time of the issue, at a price that incorporates a discount with respect to the market value of the Intesa Sanpaolo ordinar y shares, to be used for the implementation of the Long-term Incentive Plan ca lled "LECOIP 2026-2029". The afo rementioned Extraordinary Shareholders' Meeting granted the Board of Directors the broadest powers to: (i) set the issue price of t he newly issued ordinary shares; this price will be determi ned by applying a discount to the market price of the share, calculated as the average of the prices observed in the 30 days prior to the issu e date, without prejudice, in any case, to the fact that it cannot be lower overall than the amount of the increase ; (ii) set the maximum number of ordinary shares to be issued and assigned in subscr iption to the employees who are recipients of the Long-term Incentive Plan called "LECOIP 2026-2029", under the terms and conditions set f orth therein; (iii) determi ne the timeline for the execution of the capital increas e resolution; an d (iv) update t his Article 5 accordingly .
5.7.- The Extraordinary Shareholders' Meeting of 30 April 2026 granted the Board of Directors (i) a power, pursuant to Article 2443 of the I talian Civil Code, to increase the share capital free of charge, by 30 April 2031, also in several tranches, through the issue of a maximum number of 62,000,000 Intesa Sanpaolo ordinary shares, having the same features as those in circulation at the time of the issue, with regular dividend entitlement, to be assigned to the recipients of the Long-term Incentive Plan call ed "Performance Share Plan 2026-2029" , at the
7 conditions and in the terms and ways provided for by the plan i tself; all by assignment, pursuant to Article 2349 of the Italian Civil Code, of the maximum amount of profits and /or profit reserves as resulting from the latest pro tempore approved financial statements corresponding to the unst ated nominal value of the issued shares at the time the granted powers are exercised; and (ii) all the broades t powers to proceed with the precise identification of the profits and/or profit reserves resulting from the latest pro tempore approved financial statements to be allocated for the purpose referred to in point (i) above, with a mandate to carry out the appropriate accounting entries resulting from the issue transactions, in compliance wi th the provisions of law and the accounting standards applicable from time t o time and to update this Artic le 5 accordingly.
5.8- The Extraordinary Shareholders’ Meeting of 10 September 20 26 granted the Board of Directors, pursuant to article 2443 of the Italian Civ il Code, the power, to be exerci sed by 10 September 2027, to increase the share capital against payment, in one or more tranches and on a divis ible basis, excluding opt ion rights pursuant to article 2441, paragraph 4, first sentence, of the Italian Civil C o d e , f o r a m a x i m u m t o t a l a m o u n t o f E u r o 3,394,185,179.96, plus share premium, through the issue of a ma ximum of 5.7 billion ordinary shares of the Company, without nominal value, carrying full dividend rights a nd having the same characteristics as the Company’s ordinary shares in circulation on the date of issue, to be paid up by way of a contribution in kind, in support of the public tender and exchange offer for all the ord inary shares of Banca Monte dei Paschi di Siena S.p.A., announced on 8 June 2026 by the Company in a notice pur suant to article 102(1) of the Italian Legislative Decree no. 58 of 24 February 1998. Upon exercise of this author isation, the Board of Directors shall have, inter alia, the power to determine, wi thin the limits set out above, the issue price of the newly issued ordinary shares (including the share premium), any other terms and conditions o f the authorised capital increase, including any other necessary or appropriate ma tters, within the limits provi ded for by applicable legislation and by the resolutions adopted by this Extr aordinary Shareholders’ Meeting .
Article 6. Shareholders' address for service.
The address for service of each Shareholder, for the purposes o f their relations with the Company, is the address recorded in the Shareholders’ Register.
TITLE IV
SHAREHOLDERS’ MEETING
Article 7. Shareholders' Meeting.
7.1.- The Shareholders’ Meeting, dul y called and established, is deem ed to represent all Shareholders.
Resolutions passed in accordance with the law and the Articles of Association are binding on all Shareholders, irrespective of their attendance or agreement .
8 7.2.- The Shareholders’ Meeting shall be ordinary and extraordinary p ursuant to the law.
7.3.- The Ordinary Shareholders’ Meeting shall:
1) approve the financial statements and resolve upon the net incom e allocation;
2) appoint, subject to determining the number of, and remove the m e m b e r s o f t h e B o a r d o f D i r e c t o r s , determine their remuneration as per Article 16 a nd elect the Ch air and one or more Deput y Chairs, according to provisions of Article 14.8 below; 3) a p p o i n t a n d r e m o v e m e m b e r s o f t h e B o a r d o f D i r e c t o r s w h o a r e m e m b e r s o f t h e M a n a g e m e n t C o n t r o l Committee and appoint the Chair of such Committee, all accordin g to the provisions of Ar ticle 14, and determine their remuneration as per Article 16.3; 4) resolve upon the resp onsibilities of the mem bers of the Board o f Directors;
5) assign the engagement for the audi t of the accounts and determi ne the relevant fees upon the reasoned proposal of the Management Contr ol Committee and, once the opin ion of the Management Control Committee has been sought, revoke or amend the engagement granted, where necessary;
6) approve the remuneration policies for members of the Board o f Directors and staff and plans based on financial instruments; in this co ntext, it shall approve the cr iteria for determining the compensation to be granted in the event of early termination of employment or early depart ure from office, including the limits on such compensation in accordance with applicable laws and regulations , and it may also resolve upon a ratio of the variable component to the fixed component of individual remuner ation for personnel in excess of 1:1, but not in excess of the maximum according to Supervisory laws and regulat ions, with the qualified majorities defined in those same laws and regulations; 7) approve the regulations, if an y, of the Shareholders' Meetin g;
8) resolve upon the other matter s assigned to it by the regulat ions in force or by the Ar ticles of Association;
9) authorise the most significant transactions with related par ties in the cases and according to the conditions provided for in the procedures adopted pursuant to Art. 18.2, p a r a g r a p h 2 , l e t t e r h ) , i n a c c o r d a n c e w i t h applicable laws and regulations.
7.4.- The Extraordinary Shareholders’ Meeting shall resolve upon the amendments of the Arti cles of Association (without prejudice to the powers of the Board of Directors purs uant to Art. 18.2, paragraph 2, letter m), on the appointment, removal, replacement and powers of liquidators and on any other matter within its purview pursuant to the law.
Article 8. Calling of meetings .
8.1.- The Shareholders’ Meeting is calle d by the Board of Directors w henever the Board of Directors deems it appropriate or, according to the provisions of Article 2367 of the Italian Civil Code, upon request by Shareholders representing at least one twentieth of the share capital.
9 The Ordinary Shareholders’ Meetin g shall be called at least onc e a year, no later than a hundred and eighty days after the end of the financial year. 8.2.- Without prejudice to the other provisions of law setting forth the powers to call meetings, the Management Control Committee may call the Shareholders' Meeting, where nec essary for the exercise of its functions, subject to prior notice to the Chair of the Board of Directors .
8.3.- The Shareholders' Meeting is called at the registered office of the Company or in another location in the municipality where the Company has its registered office by a n otice of call stating the information required by the law. Such notice shall be published within the timeframe provided fo r by the law on the Company's website, as well as in the ways provided for by applicable laws and regulations .
8.4.- The Shareholders' Meetin g is held in single call.
The Board of Directors may establish a second call for the Shar eholders' Meeting, and, limited to Extraordinary Shareholders' Meetings, a third call. This decision is disclose d in the notice of call .
8.5.- Shareholders who, either jointly or severally, represent at lea s t o n e - f o r t i e t h o f t h e s h a r e c a p i t a l m a y request, within the terms and scope and in the manner provided for by law, additions to the agenda of the meeting, specifying in their re quest the additional items they propose. Notices with respect to the additions to the agenda as a result of such r equests shall be given in the f orms required for the publication of the notice of call.
Article 9. Right to attend and vote in the Shareholders’ Meetin g.
9.1.- Persons with the right to vote may attend the Shareholders’ Mee ting provided a notice by the authorised intermediary certifying their vo ting right has been submitted t o the Company within the time limits provided by law.
9.2.- Each ordinary share confers the right to cast one vote .
9.3.- Persons having voting rights may be represented by proxy subjec t to relevant provisions of law. The proxy may be notified electronically, using the designated section of the Company's website, or by e-mail, following the instructions provide d in the notice of call .
9.4.- For each Meeting, the Company appoints, disclosing it in the no tice of call, one or more parties upon whom holders of voting rights may confer a proxy with instructions t o vote on all or some of the items on the agenda,
10 in accordance with the terms of applicable laws and regulations . The proxy is valid only to the extent of the proposals upon which instructions to vote have been conferred.
9.5.- Where so indicated in the notice of call, persons entitled to v ote may participate in the Shareholders' Meeting by telecommunications sy stems and exercise the right to vote by electronic channels, according to the conditions specified in that same notice of call.
Article 10. Chair and conduct of the Shareholders' Meeting. Sec retary .
10.1.- The Shareholders' Meeting is chaired by the Chair of the Board of Directors, or, in case of his/her absence or impediment, by the longest-se rving Deputy Chair of the Board of Directors who is not also absent or impeded, or, in the case of equal term of service, by the eldest Deputy Chair. If all of the above are absent or impeded, the Shareholders' Meeting is chaired by a person designated by the Shareholders' Meeting.
10.2.- The Chair of the Shareholders’ Meeting, including through perso ns appointed by himself/herself, shall verify that the meeting has been duly established, shall ascert ain the entitled persons’ right to attend the meeting and vote, shall verify the valid ity of the proxy, shall preside over the discussions and works of the meeting, and shall determine the voting procedures and announce the relevant results .
10.3.- The Chair shall be assisted by a Secretary, represented by the Secretary of the Board of Directors or, in case of his/her absence or impediment, the person appointed by the Shareholders attending the Meeting if the minutes are not drafted by a Notary Public. The Chair may also appoint, as the case may be, specific individuals chosen among the Meeting’s attendees.
10.4.- If the discussion of the items on the agenda of the meeting is not exhausted on the day of the meeting, the Shareholders’ Meeting may co ntinue on the following busines s day.
Article 11. Validity of resolutions .
The validity of the Shareholders' Meeting and the validity of t he resolutions taken shall be governed by applicable l a w s a n d r e gu l a t i o n s , e x ce p t a s o t h e r w i s e p r o v i d e d f o r i n A r t i c le 14 concerning the election of the Board of Directors and the Management Control Committee.
11 TITLE V
CORPORATE GOVERNANCE SYSTEM
Article 12. One-tier governance system.
The Company adopts a one-tier governance system pursuant to Art icles 2409- sexiesdecies and following of the Italian Civil Code. It therefore operates through a Board of Di rectors (hereinafter also the “Board”), some members of which are also members of the Management Control Com mittee (hereinafter also the “Committee”).
Article 13. Board of Directors a nd Management Co ntrol Committee .
13.1. – Composition.
The Board of Directors is composed of a minimum of 15 (fifteen) and a maximum of 19 (nineteen) members, including non-Shareholders, appointed by the Shareholders’ Meet ing.
The less-represented gender shall be reserved at least two fift hs of the seats on the Board of Directors, as of the first renewal of the Board of Directors after 1 January 2020. I f this does not yield a whole number, the result shall be rounded up to the next whole number. The Management Control Committee is composed of five Directors .
13.2. – Duration.
The members of the Board of Directors shall remain in office fo r three years and their term shall expire on the date of the next Shareholders' Meeting provided for in the seco nd paragraph of Article 2364 of the Italian Civil Code. They may be re-elected.
13.3. – Integration.
I n t h e e v e n t t h a t t h e n u m b e r o f m e m b e r s o f t h e B o a r d o f D i r e ct o rs originally determined is lower than the maximum number, the Shareholders' Meeting may subsequently incr ease such number, but not beyond that maximum number. The new members shall be appointed by the Share h o l d e r s ' M e e t i n g i n a c c o r d a n c e w i t h Article 14, while preserving the r a t i o b e t w e e n t h e ge n d e r s t h r o ugh the application, where necessary, of the supplementary mechanism provided for in Art. 14.4. The newly el ected members shall end their terms of office on the same date as the members already in office.
13.4. – Requirements for members of the Board of Directors .
13.4.1 . Members of the Board of Directors must be fit to perform the du ties of their office, as established by applicable laws and regulations and the Articles of Association . In particular, they must satisfy the requirements of professionalism, personal integ rity, competence, fairness, a nd time commitment and the specific limits on concurrent positions prescribed by applicable laws and regulati ons, and in any event thos e set forth in Directive 2 0 1 3 / 3 6 / E U o f 2 6 J u n e 2 0 1 3 , t o c a r r y o u t t h e d u t i e s o f d i r e c t o r of a bank that has issued shares listed on regulated markets.
12 13.4.2 . In addition to the requirements laid down in applicable laws an d regulations, the members of the Board of Directors must satisfy the fo llowing additional requirements :
a) (Professionalism) At least four members i) must be enrolled wi t h t h e R e g i s t e r o f I n d e p e n d e n t Auditors and ii) have practised as auditors or performed the fu nctions of member of a control body of a joint-stock company for a p eriod of at least three years;
b) (Independence) At least two-thirds of the members must satisfy the independence requirements established in paragrap h 13.4.3 of this article below. In these Articles of Association, such directors are designated "Independent Directors". When the application of this quota does not yield a whole number, the requirement must be regarded as referring to a numb er of Directors rounded up to the next whole number.
13.4.3 . A Director may not be regarded as Independent if:
a) he/she is a significant shareho lder of the Company, to be un derstood to mean any person who, directly or indirectly (through subsidiaries , trustees or intermediaries), controls the Company, may exercise a significant influence over the Company or is a direct or indirect party to a shareholders' agreement through which one or more parties exercise control or significant influence over the Company;
b) he/she is, or has been in the previous three years, an execu tive director or employee:
- of the Company, of a subsidiary under its control having stra tegic importance, or of a company under common control; - of a significant shareholder of the Company; c) he/she has, or has had in the previous three years, directly or indirectly (for example, through subsidiaries or c o m p a n i e s o f w h i c h h e / s h e i s a n e x e c u t i v e d i r e c t o r , o r a s a o f partner in a professional firm or consulting company), a significant commercial, financial or professional r elationship:
- with the Company or its subsid iaries, or with their executive directors or top management;
- with a party who, even togethe r with others through a shareho lders' agreement, controls the Company or, if the parent is a company or entit y, with the related executive d irectors or top management;
d) he/she receives, or has received in the previous three years , from the Company, from one of its subsidiaries or from the parent company, significant additional remuneration in addition to the "fixed " remuneration for the office and the fee established for participation in the committ ees recommended by the Corporate Governance Code or provided for in the applicable regulations; e) he/she has been a director of the Company for more than nine consecutive or non-consecutive years of the past twelve years; f) he/she serves as executive di rector of another company at wh ich an executive director of the Company serves in the office of director; g) he/she is a shareholder or dir ector of a company or entity b elonging to the same network as the Company's independent auditors; h) he/she is a close family membe r of a person who is in one of the situations described in the foregoing points.
For the above purposes, close family members shall be understoo d to mean parents, children, a spouse not l e g a l l y s e p a r a t e d a n d c o h a b i t e e s . W i t h s p e c i f i c r e g a r d t o t h e s ituation described in letter d), the fact that a
13 Director collected deferred rem uneration for activities conclud ed more than t hree ye ars prior is n o t of itself relevant. In addition, a Director may not be regarded as Independent in t he cases indicated in Art. 148, third paragraph, of Legislative Decree 58 of 24 F ebruary 1998, as well as in the cases set out in the mandatory provisions of law and regulation applicable to th e Company, where these establish more restrictive conditions.
13.4.4. The specific requirements established by applicable law s and regulations must also be met in the cases of the Chair, the Managing Director and those who serve in othe r offices to which the requirements apply.
Members of the Management Control Committee must also satisfy t he requirements that apply to them under Art. 13.5 of the Articles of Association. 1 3 . 4 . 5 . P e r s o n s w h o a r e e m p l o y e e s o f t h e C o m p a n y o r a n o t h e r G r o u p c o m p a n y , o r w h o s e r v e i n e x e c u t i v e positions at Group companies, whe re they have been elected to C ompany's Board of Directors, unless they opt for termination of their employment or resign from their execut ive positions, shall be considered disqualified from the Board of Directors, except in the case of appointment to the office of Managing Director .
13.4.6 . Without prejudice to the provisio ns of Article 14, each Directo r, for the duration of his or her term of office, is required to update ce rtification of satisfaction of the requirements and all information useful to an overall assessment of fitness for the office filled, according to the scheme envisaged in Article 14.1, by timely notice to the Chair of the Board of Directors.
13.5.- Requirements for members of the Management Control Committee.
13.5.1 . The members of the Committee must also satisfy the requirements of integrity and professionalism and are required to abide by the lim its on concurrent offices estab lished by applicable laws and regulations for fulfilling the duties of member of the control body of a bank t hat has issued shares listed on regulated markets.
13.5.2 . In addition to meeting the requi rements established by applicab le laws and regulations, the members of the Committee must also satisfy the independence requirement s laid down in the Article 13.4, paragraph 3, of Articles of Association for Independent Directors. 13.5.3 . The members of the Committee must also have obtained at least f ive years of proven experience in the fields of internal controls, administration and finance:
a) serving as a member of compan y bodies or performing executiv e duties at entities that conduct banking or financial business with total assets of at least 5 billion euro , or at entities that conduct insurance business with annual gross premium income of at least 1 billion euro, or at e ntities or enterprises with total revenues of at least 500 million euro (sizes are unders tood to be calculated on the basis of the company’s m ost recent financial statements or consolidated financial statements, where prepared by the entity);or b) lecturing at the university level in a tenured position in e conomics or law, or performing, over an extended period, significant professional services or activities related to the duties typical of a control body for the benefit of the entities and enterprise s indicated in point a); or c ) s e r v i n g a s s e n i o r o f f i c i a l s o r c a r r y i n g o u t e x e c u t i v e d u t i e s at public administrations of at least regional importance or authorities whose responsibilities concern bankin g, finance or insurance business.
14 At least three of them must also i) be enrolled with the Regist er of Independent Auditors and ii) have worked as an independent auditor or performed the functions of member of a control body of a joint-stock company for a period of at least three years. 13.5.4 . Without prejudice to t he application of law s and regulations co ncerning concurrent positions (and, in any event, to the limits establish ed in Directive 2013/36/EU), the members of the Committee may not serve i) in offices of an executive nature at other firms or ii) in non-exe cutive offices in bodies (inc luding control bodies) at more than two other firms of significant size – by which are me ant those indicated in Art. 13.5.3, letter a). To that end, candidates for the office of Committee member express ly assume an obligation to immediately resign from incompatible offices in the event of their appointment.
13.5.5 . In any event, without prejudice to all other cases of incompati bility envisaged in applicable laws and regulations, members of the Committee are prohibited from accep ting positions on bodies other than those with control functions at other Group or financial conglomerate comp anies, or at companies in which the bank holds a strategic equity interest, in accordance with supervisory reg ulations. However, any control offices filled in accordance with this paragraph are counted for the purposes of the limits laid down in p aragraph 13.5.4 above.
13.5.6 . Members of the Management Contro l Committee may not be members of other committees appointed by the Board of Directors, with exception to the Risks Committee a nd the Committee established pursuant to the regulations governing transactions with related parties.
13.6 Loss of requirements.
The loss of the independence or p rofessional requirements laid down in Article 13.4, paragraph 2, by a Director shall not result in d isqualification if the minimum number of D irectors meeting the established requirements is still satisfied. However, the loss of the independence or professionalism requir ements established in Ar ticle 13.4, paragraph 2, shall nonetheless result in te rmination from the offices for which those requirements are imposed by applicable laws or regulations o r the Articles of Association.
For each member of the Management Control Committee, the loss o f the independence or professional requirements indicated in Article 13.5, paragraphs 2 and 3, or failure to abide by the limits on concurrent positions set forth in Article 13. 5, paragraph 4, results in di squalification from the office of Director.
13.7. – Secretary of the Board of Directors .
The Board of Directors may appoint a Secretary, who may also no t be a member.
The Secretary is responsible for drafting the minutes of the me etings and resolutions of the Board of Directors, in concert with the person chair ing each session, unless the mi nutes are drafted by a Notary. Such minutes must then be transcribed into the specific mandatory company books a nd then duly signed by the Chair of the meeting and the Secretary. Copies and extracts of the minutes, when not drafted by a Notar y, are certified by the declaration of conformity signed by the Director chairing the meeting and the Secretary.
15 Article 14. Election of the Board of Directors .
14.1 - Slates of candidates .
The election of members of the Board of Directors shall take pl ace on the basis of slates prepared by Shareholders according to the following rules: a) Shareholders representing at least 0.5%, or the lesser perce ntage set forth in applicable laws and regulations, of the ordinary share capital may submit a slate of candidates of a minimum of 2 (two) to a maximum of 19 (nineteen) names. Each slate must be divided into two sections of names, both numbered sequentially (i.e., with candidates listed with a number, starting at one in each sectio n), and must indicate separately, in the first section, the candidates for the Board of Directors other than candidates also nominated for the Management Control Committee, and, in the second section, only candidates for the Management Control Committee. The slates shall be filed at the Company's regist ered office at least twenty-fiv e days before the date of the Shareholders' Meeting called to elect the Directors, together with the information re lative to the Shareholders presenting the slates, including the indication of the total percentage stake held, al ong with a declaration of each candidate accepting his/her candidacy and attesting that he/she meets the requireme nts, applicable to all or some Directors provided for by law, regulations and the Articles of Association, and pr oviding exhaustive information on the personal and professional characteristics of each candidate and the executiv e, administrative and control positions that each fills at other companies or entities, in addition to all inform ation useful to an overall assessment of fitness for the office to be filled, according to the scheme to be published by the Company in advance, while taking account of the guidelines of the supervisory authorities. In order to give evidence of the number of shares necessary to submit a slate, the relevant communication may also be submitte d after filing of the sla te, but not later than twenty-one days before the date of the Shareholders' Meeting, f ollowing the procedure set out in the applicable law; b) each Shareholder or Shareholders belonging to the same group or w h o a r e p a r t i e s t o a s h a r e h o l d e r s ' agreement governing the Company's shares may not submit - and t he persons having voting rights may no vote for - more than one slate of candidates, even by a third party or fiduciary companies. Shareholders who submit a slate other than Shareholders who hold a controlling or relat ive majority interest must also submit a declaration i n w h i c h t h e y c e r t i f y t h e r e a r e n o c o n n e c t i o n s w i t h s u c h S h a r e h olders deemed relevant in accordance with applicable legislation. On pain of ineligibility, each candidat e may be presented on a single slate and, within a slate, in a single sectio n of that same slate;
c) each slate containing a number of candidates equal to or greate r than 3 (three): c.i) shall be composed in such a way to ensure the gender balance envisaged by current law; c.ii) shall also contain a number of candidates satisfying the independence requirement laid down in Article 13 .4 of the Articles of Asso ciation equal to at least two-thirds of the total candidates presented on the slate; and c.iii) shall contain, in its first section, at least one candidate satisfying the professionalism requirement set forth i n A r t i c l e 1 3 . 4 , p a r a g r a p h 2 , l e t t e r a ) , o f t h e Articles of Association and, in its second section, at least on e out of every two, or fractions of two, candidates satisfying that same professionalism requirement. For the prese nt purposes, the rounding criteria pertinent to
16 each requirement, as governed, r espectively, by Articles 13.1 a nd 13.4, paragraph 2, letter b), of the Articles of Association, shall apply to the portion of the candidates who s atisfy the requirements included in each slate;
d) if, upon the expiry of the term provided for by letter a), the Shareholders have filed: d.i) a single slate; d.ii) a single slate, with candidates limited to the second section onl y; d.iii) one or more slates with candidates limited to the first section only; or d.iv) only slates presented by Shareholders who accord ing to applicable laws and regulations are considered connected to one another, the Compan y promptly informs the market via press release sent to at least two pre ss agencies; in this case, slat es may be presented within the time limit set out in the legislation in force, without prejudice to the other condit ions and means of presentation provided for above;
e) the foregoing shall be without prejudice to the other and furth er provisions set forth by applicable laws and regulations as concerns the me ans and terms of submission and p ublication of the slates.
Slates which do not comply with the above provisions shall be c onsidered as not submitted. However, any irregularities in the slates concerning single candidates shall not result in the automatic exclusion of the entire slate, but only of the candidates involved in the irregularitie s.
14.2.- Voting.
14.2.1 All members of the Board of Directors, except for five, when th e Board of Directors has 19 or 18 members, or all members of the Board of Directors, except for four, in a ll other cases, are selected from the slate that has obtained the greatest number of votes (the “majority slate”), a ccording to the sequential order in which the candidates have been listed on th e slate concerned, until there are no more candidates in the pertinent section of the slate. In particular, three Directors are drawn in their sequential order from the second section of the slate that received the greatest number of votes, and those Directors are also appointed members of the Management Control Committee. The other Directors reserved for that slate are selected from its first section according to the sequential order in which they are listed.
14.2.2 Two Directors are selected, in th eir sequential order, from the first two posit ions of the second section of the slate that has candidates who qualify for the Management Co ntrol Committee and, has obtained the second-
greatest number of votes (“the f irst minority slate”) and has n ot been submitted or voted for by Shareholders considered connected, as defined in applicable laws and regulat ions, with the Shareholders who submitted or voted for the slate that obtained the greatest number of votes. The first of the above Directors takes up the office of Chair of the Management Control Committee. 14.2.3. The other members of the Board of Directors - for whate ver reason not elected according to the previous paragraphs 14.2.1 and 14.2.2 also due to the lack of candidates in the lists - are selected proportionally from the slates other than that which obtained the greatest number of vo tes (the “minority slates”, which are also understood to include the first minority slate), provided that such slates, collectively considered, have received votes corresponding to at least 10% of the ordinary capital rep resented in the Shareholde rs’ Meeting. The votes obtained by each of the slates are divided by one, two, three, four, and so on, according to the number of members to be appointed. The resulting ratios are progressively attributed to the candidates of each section of the above slates, according to the order of each of the two sec tions. The ratios attributed to the candidates on the various slates are organised into two sets of rankings, fro m highest to lowest, one for each section of the
17 slates, except for the first two ratios of the second section o f the slate from which the candidates appointed in accordance with paragraph 14.2.2 above have already been select ed. The candidates with the highest ratios in the respective ranking of the slates other than that which obta ined the greatest number of votes are elected to the Board of Directors, up to the number required to complete t he composition of the Board of Directors.
14.2.4 If the composition of the Board of Directors and the Management Control Committee cannot be completed according to the procedure laid down in the foregoing paragraphs, the necessary candidates shall be obtained by selecting any as yet unelected candidates who satis fy the requirements imposed by applicable laws and regulations and the Articles of Association from the slate that obtained the greatest number of votes, according to the order in which the candidates are presented on that slate.
14.3. - Equality of rat io and ballot.
Should more than one candidate obtain the same ratio, the prefe rred candidate shall be the candidate belonging to the slate from which no Direc tor, or the lowest number of Di rectors has been appointed.
If no Director has been appointed from those slates or the same number of Directors has been appointed from those slates, the preferred candidate shall be drawn from the s late which has obtained the highest number of votes. In case of equality of votes and ratio, a new vote is he ld by the whole Shareholders' Meeting in the form of a ballot, with the candidate who obtains a simple majority o f votes being elected.
14.4.- Supplementary mechanism .
If, upon termination of voting procedures, the composition of t he Board of Directors does not reflect the gender balance envisaged by current regulations, the candidate of the over-represented gender with the lowest ratio shall be excluded. The excluded candidate shall be replaced by the subsequent candidate of the less-represented gender within the same slate. If necessary, this procedure shal l be repeated until the composition of the Board of Directors complies with current regulations.
If, even following the above replacement procedure, an insuffic ient number of Directors with the requirements provided for by Article 13.4 of the Articles of Association hav e been appointed, new replacements shall be performed according to a proce dure similar to that set forth in paragraph 1, excluding the candidates who have the lowest ratio and do not meet all of the requirements, alway s in compliance with the current regulations on gender balance. For the sole purposes of this provision, candidates on all slat es shall be progressively assigned the ratios corresponding to the votes obtained by each slate, according to t h e p r o c e d u r e d e f i n e d i n A r t i c l e 1 4 . 2 . 3 , sentences two and three. 14.5. - Completion of composition.
If the application of the criteria laid down in the foregoing p aragraphs does not result in the appointment of all members of the Board of Directors or does not allow them to be appointed in accordance with the independence and gender requirements, the Shareholders' Meeting shall prompt ly appoint the missing members by resolution adopted by simple majority of votes on proposal submitted by pe rsons having voting rights attending the
18 meeting, in compliance with the p rinciple of the due representa tion of minorities, according to the criteria set forth in Article 15.3.5. 14.6.- Single slate .
If only one slate is presented, the members of the Board of Dir ectors shall be elected from that single slate, up to the number of candidates on that slate, selecting all member s of the Management Control Committee from the second section of the slate.
14.7.- No slates .
Should no slate be submitted in a timely manner, the Shareholde rs' Meeting shall pass a resolution (for the appointment of both the Board of Directors and the Management C ontrol Committee) by the relative majority of the capital represented at the Shareholders' Meeting, withou t prejudice to the necessary compliance with the requirements of applicable laws and regulations and the Article s of Association. In case of equality of votes, candidates shall be appointed b y means of a further ballot.
14.8. - Election of the Chair and Deputy Chairs.
The Shareholders' Meeting appoints the Chair of the Board of Di rectors and one or more Deputy Chairs by relative majority.
Article 15. Termination of office .
15.1. – Simul stabunt simul cadent .
If, for any reason, more than one-half of the members of the Bo ard of Directors leave service, the entire Board of Directors shall be regarded as terminated with effect from t he date on which the new Directors take office and the remaining members must call an urgent session of the Sh areholders' Meeting to appoint a new Board of Directors. 15.2. – Removal.
The members of the Board of Directors, including the members of the Management Control Committee, may be removed by the Shareholders' Meeting at any time, without preju dice to the right of the removed Director to be indemnified if removal occ urs without just cause.
The proposal to remove one or more members of the Management Co ntrol Committee must provide an adequate account of the reasons for such removal. Such proposal , where submitted by the Board of Directors, must be adopted with the favourable vote of the absolute majori ty of its members in office and with the advance opinion of the Nomination Committee, expressed unanimously by t hose in attendance; where such proposal is submitted by the Management Control Committee, it must be adopt ed unanimously by the Committee’s members. Removal of members of the Manage ment Control Committee must be duly justified.
19 Removal of a member of the Management Control Committee also en tails the removal of that same member from the Board of Directors. 15.3. – Replacements .
15.3.1. If a member of the Board of Directors other than a memb er of the Management Control Committee leaves service, the Board of Directors shall replace the outgoi ng member by co-opting a new member onto the Board of Directors, provided that the majority of Directors hav e still been appointed by the Shareholders' Meeting, in compliance with the applicable requirements, the nu mber of independent Directors and Directors of the less represented gender requi red by the Articles of Associa tion and applicable l aws and regulations.
15.3.2. If a member of the Management Control Committee leaves service, he or she shall be replaced by the first non-appointed candidate from the second section of the sl ate of the member leaving service. If the person identified on the basis of the foregoing criterion does not mee t the requirements applicable to the outgoing member under laws, regulations or the Articles of Association, the outgoing member shall be replaced by the first unelected member from the second section of that same sla te and in possession of the same requirements envisaged for the member to be replaced. If the Chair of the Ma nagement Control Committee leaves service, the member from the same list as the outgoing member and next in th e ranking upon appointment shall become Chair.
15.3.3 . If, for whatever reason, it is impossible to proceed with the r eplacement on the basis of the above criteria, the member of the Management Control Committee who has left ser vice shall be replaced by the Shareholders' Meeting, called withou t delay in accordance with paragraph 15.3 .5 below .
15.3.4 . The new members of the Managemen t Control Committee and members co-opted onto the Board of Directors shall remain in office until the next Shareholders' M eeting .
15.3.5 . The Shareholders' Meeting called to appoint a new Director in r eplacement of the outgoing member shall proceed with appointment or replacement in accordance with the principle of due representation of minorities, the balance of the genders and t he other requirements establish ed by the laws, regulations and these Articles of Association.
Accordingly, the Shareholders' M eeting proceeds as follows: whe n it is tasked with replacing Directors appointed from the majority slate or the single slate, or Directors appoi nted directly by the Shareholders' Meeting, it shall appoint them by relative majority vote without restriction by s l a t e . I f , o n t h e o t h e r h a n d , i t i s t a s k e d w i t h replacing Directors a ppointed from a minority list, the Shareho lders' Meeting shall replace them by relative majority, selecting them from amongst the candidates on the sla te of the Director to be replaced or, alternatively, from amongst the candidates on a ny additional minority slates, or by relative majority but without taking account o f t h e v o t e o f t h e S h a r e h o l d e r s w h o s u b m i t t e d t h e m a j o r i t y s l a t e during the most recent appointment of corporate bodies, or who, according to disclosures presented in accordance with applicable laws and regulations, directly or indirectly hold the relative majority of votes that may be cast in the Shareholders' Meeting and connected Shareholders, as define d in applicable laws and regul ations.
15.3.6 . The term of office of Directors appointed by the Shareholders' Meeting expires simultaneously with the term of the members in office at the time of their appointment.
20 Article 16. Reimbursement of expenses, compensation and remuner ation for company offices .
16.1. – Reimbursement of expenses .
Members of the Board of Directors are entitled to reimbursement of expenses incurred due to their office .
16.2. – Remuneration of the members of the Board of Directors.
Upon appointing the Board of Dir ectors, the Shareholders’ Meeti ng determines the remuneration of Directors in a fixed amount, in accordance with applicable laws and regulati ons, for the entire period of their office, as well as the additional remuneration for the office of Chair and Depu ty Chair.
16.3. – Remuneration of the members of the Management Control Committee .
Upon the appointment of the Management Control Committee and fo r the entire period of its office, the Shareholders' Meeting is responsible for determining specific r emuneration for the Committee's members, which must always be of a fixed, equal amount for each member, but with a specific additional amount for the Chair.
16.4. – Remuneration for particular offices .
Without prejudice to Art. 16.2, the Board of Directors is respo nsible for establishing, b y the proposal of the Remuneration Committee, in addition to the remuneration determi ned by the Shareholders' Meeting, the remuneration of members of the Board of Directors to whom the B oard of Directors assigns additional particular offices in accordance with the Articles of Association. Such re muneration is determined in a fixed amount, with the exception of the remuneration of the Managing Director and General Manager, also established in a variable amount, in accordance with the re muneration policies approved b y the Shareholders' Meeting.
Article 17. Meetings and resolut ions of the Board of Directors .
17.1.- Calling of meetings.
The Chair of the Board of Directors shall summon the Board of D irectors on his/her own initiative and in the cases provided for by law or by the Articles of Association. He/she s hall chair meetings of the Board of Directors and set the agenda, ensuring that adequate information on the matte rs on the agenda of the meeting is promptly provided to all members of the Board of Directors.
17.2.- Frequency of meetings.
The Board of Directors shall m eet, as a rule, once a month.
21 17.3.- Calling request.
The Chair shall call the Board of Directors upon the written re quest of the Managing Director or at least two members of the Board of Directors stating the matters to be dis cussed, without prejudice to Article 23.5.
17.4 .- Place.
Meetings of the Board of Directors shall generally be held alte rnatively at the registered office and at the secondary office of the Company or exceptionally in another loc ation on the Italian territory.
17.5.- Notice of call.
The notice of call, including the agenda of the meeting, shall be sent to the members of the Board of Directors at least four days before the date scheduled for meeting, by an y means appropriate to supply evidence of receipt thereof. In particularly urgent situations, the meeting may be called by giving twelve hours' notice or in the other manners established in advance by the Board of Directors on the basis of exceptional circumstances.
The notice of call may also contain the indication of the place s from which to participat e in the meeting through the use of remote connection syst ems as provided for in Article 17.6 below.
A Board meeting shall be deemed to be validly constituted when, e v e n i n t h e a b s e n c e o f a f o r m a l c a l l , i t i s attended by all Directors. 17.6.- Meetings.
Valid meetings of the Board of Directors may also be held throu gh remote connection systems, provided that the identity of those attending can be verified and that all are ab le to follow discussions and intervene in real time with regard to the matters on the agenda as well as view, recei ve and transmit documents.
17.7. - Assistance at meetings.
Without prejudice to the provisio ns of Article 18.2, paragraph 2, letter c) concerning members of the Steering Committee, the Board of Directors may admit Group employees and /or members of Group corporate bodies, as well as consultants or experts from outside the Company to its proceedings, for matters of their competence and to satisfy the Board of Directors’ need for improved informatio n.
17.8.- Validity and majority.
Each member of the Board of Directors is entitled to submit pro posals or motions concerning matters on the agenda. For the validity of the decisions of the Board of Directors, a majority of its members in o ffice shall be in attendance at the meeting. Save as indicate d in Art. 17.9 below, decisions are taken with the absolute majority of the votes of the members attending the meeting; in the event of a tie, th e board member in the Chair shall have the casting vote.
22 17.9. - Resolutions with qualified majorities.
The favourable vote of the majority of the members in office of the Board of Directors is required for resolutions
concerning:
- the appointment and removal of the Managing Director, the attri bution, modification or removal of his/her powers, and the determination of his/her remuneration;
- the replacement of Directors by c o-option in accordance with th e provisions of Article 15.3;
- the proposal to remove members of the Management Control Commit tee, in accordance with the provisions of Article 15.2;
- the appointment and removal of the Manager responsible for prep aring the Company's financial reports, in accordance with Art. 154-bis of Legislative Decree 58 of 24 Feb ruary 1998, and determination of the related powers.
17.10 .- Interests of members of the Board of Directors A member of the Board of Directors who has an interest, on his/ her own account or on that of third parties, in a certain transaction of the Company submitted for the attention of the Board of Directors, shall promptly disclose such interest and state its nature, terms, origin and extent. I f there is a conflict of interest, he/she must abstain from the decision. The resolution of the Board of Directors app roving the transaction shall provide adequate reasons for the transaction and explain its profitability for t he Company.
17.11 . – Board regulations .
The Board of Directors may adopt regulations that, in accordanc e with the law and Articles of Association, more specifically determine its organisational methods.
Article 18. Powers of the Board of Directors .
18.1. – Duties of the Board of Directors.
The Board of Directors is respon sible for corporate management .
For this purpose, the Board of Directors may undertake all tran sactions considered useful or appropriate in achieving the corporate purpose, relating to both ordinary and extraordinary administration.
W i t h o u t p r e j u d i c e t o t h e p o w e r s d e f i n e d i n A r t i c l e 1 8 . 2 , t h e B o ard of Directors delegates to the Managing Director the powers necessary and appropriate to ensure consist e n c y w i t h d a y - t o - d a y m a n a g e m e n t , i n implementation of the guidelines approved by the Board of Direc tors.
The Board of Directors determines, in a clear, detailed and pre cise manner, the content, limits in terms of quantity and/or value, and conditions for the exercise of the p owers delegated to the Managing Director, establishing the methods whereby the Board of Directors is to b e ensured adequate information concerning the delegated activity, in a manner respectful of the balance of po wers.
23 18.2. – Powers which shall not be delegated .
18.2.1 The Board of Directors is respon sible for all duties of strateg ic supervision provided f or in applicable laws and regulations. In this context, the Board of Directors:
defines and approves the business model, strategic guidelines a nd the risk appetite, and thus approves the risk appetite framework, the strategic, industrial and fina ncial plans of the Company and the Group;
defines and approves the risk m anagement objectives and policie s of the Company and Group, as well as the general guidelines of the Internal Capital Adequacy Asse ssment Process (ICAAP);
defines and approves the guidelines of the internal control sys tem of the Company and the Group and, in this context, approves the rules according to which the duti es and responsibilities of the bodies and control functions and the methods of coordination thereof are d efined;
defines the overall governance structure, approves the Company' s organisational structure and identifies the information flows required to ensure the full ci rculation of information within the Board of Directors and the information flows that must be sent to the Bodies and Committees also by company structures; it also passes resolutions concerning the system of delegated powers relating to lending and assesses the general performance of the Company and the Group;
approves accounting and reporting systems and supervises the pr ocess of public disclosure and communication by the Company and the Group;
periodically reviews the previou s decisions in the above areas;
ensures effective dialogue with the heads of the main company f unctions and assesses their choices and decisions over time.
18.2.2 In addition to the matters that cannot be delegated under appli cable laws and regulations, the following are also reserved solely for the Board of Directors: a) appointment and removal of the Managing Director and the Gen eral Manager, the assignment, modification or termination of his/her powers, and the remunera tion for the office;
b) the appointment and removal of members of committees appoint ed by the Board of Directors instituted in accordance with the Articles of Association, including their Chair and the institution of additional committees within the Board of Directors wi th assessment and advisory func tions in accordance with Article 28;
c) the institution of a Steering Committee, chaired by the Mana ging Director and composed of the executives in charge of major company functions; by proposal of the Managing Director, the Board of Directors determines the composition, duties and powers of the Steering C ommittee and approves its operating regulations; the Board of Directors determines the manner in wh ich it is to be informed of the activity performed.
Members of the Steering Committ ee may participat e in meetings o f the Board of Directors without voting rights, as provided for by the Board reg ulations according to the subse quent letter i);
d) the institution, by proposal of the Managing Director, of th e other Managerial Committees envisaged in the first level organisational structure and the determination of their composition, duties and related powers, approval of their operating regulations and determination of th e manner in which the Board of Directors is informed of the activity performed;
24 e) the appointment, removal and supervision of the Manager resp onsible for preparing the Company's financial reports, in accordan ce with Art. 154-bis of Legislati ve Decree 58 of 24 February 1998, the determination of the said Manager's powers and means and the remuneration to which he/she is entitled;
f) the appointment and removal of the heads of company control functions, as define d in supervisory regulations, and the appointment of the head of the Safety and Protection function, who is the employer for safety purposes pursuant to Leg islative Decree 81 of 9 April 20 08, with the broadest decision-making, organisational and spending powe rs for the fullest fulfilment o f obligations relating to the protection of health and safety in the workplace; g) the drafting of the remuneration and incentive policy to be submitted to the Shareholders' Meeting and the definition of the remunerati on and incentive systems of per sons for whom supervisory regulations require this task be performed by the body charged with strategic super vision;
h) the determination of criteria to identify the related-party transactions under the powers of the Board of Directors and the approval of the procedures applicable to t ransactions with related parties and associated entities of the Group; i) the approval and modification of any regulations governing t he organisation and functioning of the Board of Directors and committees appointed by the Board of Dir ectors instituted by the A rticles of Association;
j) the approval and modification of the main internal regulatio ns;
k) decisions concerning i) the pur chase and sale of equity inve stments resulting in changes in the composition of the Banking Group, and equity investments regard ed as strategic in accor dance with supervisory r e g u l a t i o n s o r p l a n s a n d p o l i c i e s a d o p t e d b y t h e B o a r d o f D i r e c tors, in addition to ii) the purchase, sale, contribution of firms, business lines, assets and legal relatio nships identifiable en bloc under Article 58 of Legislative Decree 385 of 1 September 1993 deemed strategic acc ording to the criterion indicated in point i) above and iii) investments and disinvestments, including of rea l estate, considered strategic according to the criterion indicated in point i) above and , in any event, iv) t ransactions of the categories indicated in the preceding points with a value of more than 3% of the total own funds of t he Company calculated at the consolidated level for supervisory purposes; l) the designation of members of corporate bodies of subsidiari es, including executive Directors;
m) in application of Art. 2365, paragraph 2, of the Italian Civ il Code, merger and demerger resolutions in the cases envisaged in Article s 2505 and 2505-bis of the Italia n Civil Code, the institution or elimination of secondary registered offices, the reduction of share capital in cases of withdrawal by Shareholders and the amendment of the Articles of Asso ciation to comply with laws an d regulations;
n) guidelines concerning the Company’s and the Group’s cultural initiatives, with particular reference to the enhancement of the historic, archaeological and artistic he ritage and the management of the Allowance for charitable, social and cultural contributions, verifying that t he planned initiatives are consistent with declared objectives.
The Board shall also ensure that donations are coordinated with in the framework of the annual plan of direct and indirect interventions, for which it approves the associated general regulations, also in line with the Group’s attention and responsib ility towards environmental, soc ial and governance issues.
25 The Managing Director exercises the power to submit proposals p ursuant to Article 20.2. The foregoing is without prejudice to the advisory, assessm ent and propositional powers that applicable laws and regulations reserve for committees instituted by the Articles of Association and the po wer of individual Directors to submit proposals of resolution.
18.2.3 The Board of Directors assesses the fitness of its members, tak ing account of applicable laws and regulations and the specific rul es adopted by the Board of Dire ctors concerning quantitative and qualitative c o m p o s i t i o n d e e m e d o p t i m a l f o r t h e B o d y a s a w h o l e a n d f o r i t s Committees, including in light of the characteristics of the Company a nd the established corporate go vern an ce ob jectives. The Board of Directors adopts the measures necessary to that end to ensure that each D irector and the Board of Directors as a whole are fit in terms of competence, fairness, reputation, autonomy of judgement, time co mmitment and degree of diversification, including in respect of experience, age, gende r and international orientation, where necessary, proposing the removal or announc ing the disqualification or sus pension of Directors who do not demonstrate that they satisfy the prescribed requirements, in the cases env isaged in applicable law s and regulations.
For members of the Management Control Committee, the declaratio n of disqualification is rendered by the Committee itself.
18.3. – Specific offices.
The Board of Directors may confer on its members specific offic es and, by proposal of the Managing Director, confer on Executives, managers of individual branches or other personnel specific powers for certain activities or categories of transactions an d dealings, while determining t he content, limits and meth ods of exercise of such powers, by establishing when the delegated parties may act indi vidually or jointly or through a committee.
18.4. - Subsidised and special lending .
With respect to activities concerning subsidised and special le nding provided for by specific laws and regulations, decision-making and granting powers may be delegated to banks b elonging to the Group, according to the limits and criteria which shall be subject to agreement among the coun terparties involved.
Article 19. Chair of t he Board of Directors .
19.1. – Powers.
The Chair of the Board of Directors supervises the works of the Board of Directors, organises and directs its activity and carries out all of the duties provided for in supe rvisory regulations in effect from time to time.
In this context, he/she:
a) calls and chairs meetings of the Board of Directors and sets th e agenda, ensuring that adequate information and documentation concerning the matters on the age nda are provided in a timely manner to all members;
26 b) ensures the efficacy of debate within the Board of Directors an d acts in a neutral way to ensure that the resolutions adopted by the Board of Directors are the result of adequate discussion, particularly between the Managing Director and the other Directors, and of t he informed, reasoned contribution of all of its members;
c) ensures that the self-assessment process is effectively perform ed;
d) sees to the calling of the Shareholders' Meeting;
e) chairs the Shareholders' Meeting and supervises its conduct and proceedings;
f) promotes and supervises the effective functioning of the corpo rate governance system, including with regard to aspects concerning internal and external communicatio n, liaising with the committees instituted by the Articles of Association in which he/she does not participate, and ensures the balance of powers, with particular regard to the day-to-day management powers delegated;
g) liaises as necessary and appropri ate with the Managing Director ;
h) requests and receives information , including information regard ing specific aspects of the Company’s and the Group’s management and current and future trends of ope rations, with access to all company functions for this purpose;
i) supervises and verifies the propriety of the management of Shar eholders' relations, in agreement with the Managing Director;
j) manages relations with the supervisory authorities with regard to matters in his/her purview and his/her activities as liaison to the Board of Directors and Shareholder s' Meeting;
k) has the power to appear in court and delegate representation of the Company at trial before any judicial or administrative authority, including the power to commence co urt actions, as well as to grant mandates, even of a general nature, in court proceedings, with the obligation of informing the Board of Directors on decisions taken;
l) plans, after consulting with Man aging Director, in accordance w ith the guidelines set by the Board of Directors, and manages the Compan y’s and the Group’s cultural i nitiatives, with particular reference to the enhancement of the historic, archaeological and artistic he ritage and to the management of the “Allowance for charitable, social and cultural contributions”;
m) exercises all other functional p owers in the exercise of his/he r office.
19.2. – Supplementary powers in urgent cases.
The Chair of the Board of Directors has a non-executive role an d does not perform management functions, either formally or on a de-facto basis. In urgent cases, the Chair of the Board of Directors or, in the case of his/her absence or impediment, the Deputy Chair or the eldest Director, as provided for by Article 19.3, upon a binding proposal from the Managing Director, may take resolutions on any matters within the powers of the Bo ard of Directors, with the exception of the strategic matters as well as matters which may not be delegated and are solely within the powers of the same Board. The same rules apply to the urgent resolutions set out i n Article 18.2.2 of the Articles of Association,
27 limited to those concerning the nomination of members of corpor ate bodies of subsidiaries, in accordance with letter l) of the same Article 18.2.2. In cases of urgency, decisions w ith regard to lending may only be adopted by the Managing Director.
The Board of Directors shall be i nformed of such resolutions at the first next meeting.
19.3. - Deputy Chairs.
If the Chair of the Board of Directors is absent or impeded, hi s/her functions shall be performed by the longest-
serving Deputy Chair, or, if length of service is equal, the el dest Deputy Chair. If he/she is absent or impeded, he/she shall be replaced by a Deputy Chair chosen according to the criteria indicated above. If the latter is also absent or impeded, the functions of Chair are performed by the longest-serving member of the Board of Directors who is not a member of the Management Control Committee or, if length of service is equal, by the eldest such member of the Board of Directors.
The same temporary replacement c riterion also applies in the ca se of early termination of the office of Chair, up to the date of the next Shareholders' Meeting called to appoint the new Chair.
Article 20. Managing Director
20.1. - Appointment and powers.
After consultation with the Nomination Committee, the Board of Directors with the qualified majority set forth in Article 17.9 appoints a Managing Director from amongst the m embers of the Board of Directors, not including the Chair of the Board of Direct ors, the members of the Managem ent Control Committee and the minimum number of Independent Directors indicated in Article 13.4, para graph 2, letter b; the Board of Directors delegates the Managing Director the powers relating to the day-to-day man agement of the Company, in accordance with Article 18.1. 20.2. – Functions.
The Managing Director a) is the Chief Executive Officer and General Manager and supervis es the company’s management to the extent of his/her assigned powers, in compliance with the gener al, programmatic and strategic guidelines established by the Board of Directors;
b) determines and issues operation al directives an d is responsible for personnel management;
c) submits proposals for resolutions by the Board of Directors, in the context of his/her powers, without prejudice to the provisions of Ar ticle 18.2, paragraph 2, final subparagraph;
d) ensures the implementation of the resolutions of the Board of D irectors, with particular reference to the implementation of the strategic guidelines, risk appetite f ramework and the risk governance policies defined by the Board of Directors;
28 e) also ensures that the organisational, administrative and accoun ting structure and the internal control system are adequate considering the nature and size of the Comp any and suited to fu rnishing a proper representation of operations.
In performing his/her functions, the Managing Director relies o n the Committees provided for in Article 18.2, paragraph letters c) and d). In case of absence or impediment of the Managing Director:
- the functions of General Manager, as described in this paragrap h 20.2, shall be assigned by joint signature to two Top Managers belonging to the Steering Committ ee provided in Article 18.2.2 lett. c), as identified by the Board of Directors upon the Managing Direc tor’s proposal;
- the powers delegated to the Managing Director shall be exercise d by the Board of Directors.
20.3. – Reporting.
The Managing Director provides the Board of Directors with the information requested of him/her by the Chair or the Directors and reports, in any event, with generally mont hly frequency, at least quarterly frequency, on general operating performance, as well as on the most significa nt transactions carried out by the Company and its subsidiaries. The information periodically provided to the Board of Directors is also specifically presented to the Management Control Committee. The foregoing is without prej udice to cases of particular urgency, in which the Managing Director reports without delay. Article 21. Manager responsible for preparing the Company’s fin ancial reports .
The Manager responsible for prepa ring the Company’s financial r eports shall be chosen among the Company’s executives and shall meet profe ssional requirements consisting of specific experience in:
a) financial and accounting d isclosures of issuers listed in re gulated markets or their subsidiaries and b) management or control of the relevant administration procedu res, matured for a period of at least five years in positions of responsibility of operating structures within t he Company, the Group or other companies or entities comparable in terms of activities and organisational s tructures.
The Manager responsible for preparing the Company’s financial r eports must also meet integrity requirements for members of control bodies of listed com panies envisaged und er current regulations.
The Board of Directors verifies that all of the foregoing requi rements have been met upon appointment.
Article 22. Representation. Signature powers .
22.1. - Chair of the Board of Directors The Company's legal representative vis-à-vis third parties and in court shall be the Chair of the Board of Directors, who also has signature powers, a nd in the case of his/her absen ce or impediment, the person who replaces him/her in accordance with Article 19.3. The signature of whoev er substitutes the Chair shall constitute evidence of absence or impediment of the Chair vis-à-vis third parties.
29 22.2. – Managing Director.
Without prejudice to the foregoing, the Managing Director and G eneral Manager shall also be the Company’s legal representatives vis-à-vis third parties and in court and he/she shall have signature powers with respect to the matters assigned to him/her by the Articles of Association and delegated to him/her by the Board of Directors.
22.3. – Other parties.
For specific acts or categories of acts, the Board of Directors may issue powers of attorney, with the related power to sign on behalf of the Company, to individuals outside the Company.
The Board of Directors may autho rise Company personnel to sign on behalf of the Company, normally jointly, but for the categories of acts determined by the Board, even in dividually.
The Chair of the Board of Direct ors may grant special powers of attorney also to individuals outside the Company, to sign specific acts or categor ies of acts, contracts and docu ments relating to transactions approved by the Company’s competent bodies. The same faculty, within the lim its of delegated powers, is gra nted to the Managing Director and General Manager as part of his/her duties and powers.
Article 23. Management Control Committee .
23.1. – Functions.
The Committee carries out the dut ies assigned to the control bo dy by applicable law s and regulations.
In this context, the Committee: a) supervises compliance with law s, regulations and the Article s of Association and observance of the principles of correct management; b) supervises the adequacy, efficien cy and functionality of the Co mpany's organisational structure and internal control system, as well as of the administrative and a ccounting system and its suitability to furnishing a proper representation of operati ons, while also taking account of the Group controlled by the Company;
c) determines the efficacy of a ll structures and functions invo lved in the control system and the adequate coordination thereof, promoting corrective measures for the def iciencies and irregularities identified;
d) is specifically consulted, be sides with regard to decisions involving the appointmen t and removal of the Manager responsible for preparing the Company's financial repor t s a n d t h e a p p o i n t m e n t a n d r e m o v a l , b y proposal of the Risks Committee, of heads of company control fu nctions, as defined in supervisory regulations, also with regard to the definiti on of the essential elements of the overall control system (powers, responsibilities, resources, information flows and management of conflicts of int erest);
e) supervises the methods for the actual implementation of the corporate governance rules laid down by codes of conduct drawn up by management companies of regulated markets or by trade associations to which the Company declares its adher ence by public disclosure;
30 f) proposes to the Shareholders' Meeting the independent audito rs to which to assign the audit and the fees for the related services, supervises their actions and exc hanges with the independent auditors the data and information relevant to the performance of their respective dut ies;
g) carries out the duties assigne d by Art. 19 of Legislative De cree 39 of 27 January 2010 to the internal control and audit committee; h ) r e p o r t s i n a t i m e l y m a n n e r t o t h e s u p e r v i s o r y a u t h o r i t y a n d Consob with regard to management irregularities or violations of statutes, in accordance with Ar t. 52, paragraph 1, of Legislative Decree 385 of 1 September 1993, and Art. 149, paragraphs 3 and 4- ter of Legislative Decree 58 of 24 February 1998;
i) submits filings to the Bank o f Italy pursuant to Art. 70, pa ragraph 7, of Legislati ve Decree 385 of 1 September 1993; j) reports on the supervisory activity performed, omissions and r e p r e h e n s i b l e f a c t s i d e n t i f i e d t o t h e Shareholders' Meeting called to a pprove the annual financial st atements;
k) with prior notice to the Chair of the Board of Directors, ca lls the Shareholders' Meeting, when in the course of carrying out its duties it identifies reprehensible f acts of significant severity and there is an urgent need to take action, as well as in th e other cases envisaged in Arti cle 8.2;
l) expresses opinions where so required by applicable laws and regulations governing the control body;
m) performs, in accordance with its control function, the addit ional duties assigned to it by the Board of Directors, or the activities requested of it by the Chair of th e Board of Directors for the purposes and in the context of the powers set forth in Article 19 of the Articles o f Association.
The Committee coordinates with the Manager responsible for prep aring the Company's fina ncial reports and the Risks Committee with respect to obligations and disclosures of mutual interest.
23.2. – Organisation.
The Committee determines its own operating regulations, which m ust firstly be submitted to the assessment and opinion of the Board of Directors. The Committee is duly constituted with the majority of its memb ers and passes resolutions by the majority of those in attendance. Committee meetings may also be held via telecommunications syst ems, as indicated in the Articles of Association with respect to meetings of the Board of Directors. In such cas es, the Committee meeting shall be regarded as held in the place in which the Chair is located. 23.3. – Relations with the independent auditors and internal control managers.
The heads of internal control functions and structures also rep ort relevant data and information to the Committee, on their own initiative or also at the request of on e or more of its members. Reports by company control functions must also be di rectly submitted by the heads of the respective functions to the Committee.
31 23.4. - Group coordination.
The Committee operates in close coordination with the control b odies of subsidiaries, while also promoting the timely exchange of all useful information.
23.5. – Powers of the Committee.
The Committee or its individual members hold the following powe rs, within the limits and according to the conditions permitted under Art. 151 -ter of Legislative Decree 58 of 24 February 1998: i) the powers to request news and information from the other Directors or governance bod ies of subsidiaries, on the understanding that such information must be provided to all members of the Committ ee; ii) the power to request that the Chair of the Committee call the Committee, with an indication of the sub jects to be discussed; iii) the power, with prior notice to the Chair of the Board of Directors, to call the Boar d of Directors and avail of the company’s employees in performing its duties; the Co mmittee has the power to procee d, at any time, including through a specifically delegated member, with inspections and controls, as well as to exchange information with the corresponding bodies of subsidiaries regarding governance syst ems and the gen eral course of company activity .
Article 24. Mandatory board committees.
The Board of Directors shall institute a Nomination Committee, Remuneration Committee and Risks Committee within its scope. Each Committee is composed of a mi nimum of three to a maximum o f five non-executive Directors, with a majority being independent. A Director appointed Chair of one committee may not serve as Ch air of another committee appointed by the Board of Directors. The Board of Directors shall also institute the other committee s required by applicable laws and regulations .
Article 25. Nomination Committee.
The Nomination Committee perfor ms assessment and advisory funct ions in support of the Board of Directors with regard to the nomination of members and the composition of the Board of Directors, when the Board of Directors holds such power, and also performs the additional du ties assigned to it by applicable laws and regulations or the Board of Directors. Article 26. Remuneration Committee .
The Remuneration Committee has propositional and advisory funct ions with regard to compensation and remuneration and incentive systems and performs the additional duties assigned to it by applicable laws and regulations or the Board of Directors.
32 Article 27. Risks Committee.
The Risks Committee carries out the duties assigned to it by ap plicable laws and regula tions and the Board of Directors.
Article 28. Other Committees .
The Board of Directors may institute other Committees with asse ssment and advisory duties of a permanent or limited duration, determining the functions of such Committees f r o m t i m e t o t i m e , s e l e ct i n g m e m b e r s f r o m amongst Directors and determinin g their remuneration in accorda nce with the remuneration policies approved by the Shareholders’ Meeting.
TITLE VI
FINANCIAL STATEMENTS - NET INCOME
Article 29. Financial statements and net income .
29.1.- The Company’s financia l year closes on 31 December of each year .
29.2.- The Board of Directors shall examine and approve the draft sepa rate financial statements and consolidated financial statements in accord ance with legal requirements .
29.3. - Net income as reported in the financial statements, net of the portion allocated to l egal reserves, and the portion which is not available pur suant to the law, shall be al located as follows:
a ) t o a l l o f t h e o r d i n a r y s h a r e s t o t h e e x t e n t t h a t t h e S h a r e h o lders’ Meeting resolves to proceed with its distribution; b) any excess funds shall be allocated to the extraordinary res erve and other reserves, without prejudice to the fact that a portion of such earnings may be used for charities and to support social and cultural activities, through the creation of a sp ecific allowance.
29.4.- Unclaimed and forfeited dividends shall be remitted to the Comp any and allocated to the extraordinary reserve. 29. 5. - T he Bo ard of Direc to rs may resolve on the distrib ution of in terim dividends , i n t he form an d man ner provided for in the applicable law.
33 TITLE VII
AUDITS OF ACCOUNTS – WITHDRAWAL –WINDING UP –
APPLICATION OF ORDIN ARY REGULATIONS.
Article 30. Audits of accounts .
The audit of the accounts shall be carried out by an independen t auditing firm which meet s the applicable legal requirements. The assignment and the revocation of the engageme nt, the duties, and the responsibilities are provided for by law and the Articles of Association.
Article 31. Withdrawal.
31.1.- The right of withdrawal may be exercised only in those cases ex clusively provided by law. The right of withdrawal is excluded for those shareholders who did not parti cipate in the approval of the resolutions
regarding:
- the extension of the Company’s duration;
- the introduction or cancellation of restrictions of the circula tion of shares.
31.2. - The terms and methods of the exercise of the right of withdrawa l, the criteria to determine the value of the shares and the related liquidation procedure are governed b y the law.
Article 32. Winding up.
Save as otherwise provided pursuant to the law, if there is a r eason for winding up, the Shareholders’ Meeting shall establish the manners of li quidation, and a ppoint one or more liquidators.
Article 33. Application of ordinary regulations.
The provisions of law apply to any matter not regu lated by the Articles of Association .