Exhibit 99.4

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Annual Report
as at 31 december 2024

Banca Monte dei Paschi di Siena S.p.a.

Registered office in Piazza Salimbeni 3, Siena, Italy

Share Capital: €7,453,450,788.44 fully paid in

Registered with the Arezzo-Siena Companies’ Register – registration no. and tax code 00884060526

MPS VAT Group - VAT number 01483500524

Member of the Italian Interbank Deposit Protection Fund. Registered with the Register of Banks under no. 5274

Monte dei Paschi di Siena Banking Group, registered with the Register of Banking Groups.

BANCA MONTE DEI PASCHI DI SIENA

Index

  2024 ANNUAL REPORT -

2024 ANNUAL REPORT - Governing and control bodies

Governing and control bodies

Board of directors

Board of statutory auditors

General management

Financial Reporting Officer

Nicola Massimo Clarelli

Independent Auditors

PricewaterhouseCoopers S.p.A.

Consolidated Annual Report

Consolidated Report on operations

2024 ANNUAL REPORT - Consolidated Report on operations

General accounting standards

The Consolidated Report on Operations as at 31 December 2024 provides a snapshot of the activities and results which largely characterised the Group’s operations during the year, both as a whole and in the various business sectors.

In particular, economic and financial indicators, based on accounting data, are those used in internal performance management and management reporting systems, and are consistent with the most commonly used metrics within the banking industry, thereby ensuring the comparability of presented figures.

The income statement and balance sheet have been reclassified based on presentation criteria that are more suitable for representing the contents of the items according to consistent operational criteria.

In addition, the Report incorporates non-financial company information providing the details on the activities, capital, risks and relations that are significant to the Group’s current and future performance. This information is also detailed in corporate communications available on the Banca MPS website www.mps.it, such as: the Report on Corporate Governance and Ownership Structure, the Remuneration Report, Pillar 3 Disclosure.

BANCA MONTE DEI PASCHI DI SIENA

Results in brief

Below are the main figures of the income statement and balance sheet of the Montepaschi Group as at 31 December 2024, calculated on the basis of the reclassified financial statements, the methods of which are illustrated in the section “Income statement and balance sheet reclassification principles” of this Report, and compared with what was recorded in the previous year. The Alternative Performance Measures (APMs) identified by the Directors to facilitate the understanding of the economic and financial performance of the Group’s operations are also presented. The APMs, which are built using the reclassified data reported in the Reclassified Income Statement and Reclassified Balance Sheet chapters, are based on accounting data, corresponding to those used in internal performance management and management reporting systems, and consistent with the most commonly used metrics within the banking industry, thereby ensuring the comparability of reported figures. The APMs are not envisaged by the IAS/IFRS international accounting standards and, although they are calculated on financial statement data, they are not audited or reviewed.

These measures take into account the Guidelines provided by the European Securities and Markets Authority (ESMA) on 5 October 2015, which the Italian stock exchange regulator, Consob, incorporated into its supervisory practices (Communication no. 0092543 of 3 December 2015), applicable from 3 July 2016. With reference to the context resulting from the military conflict between Russia and Ukraine, note that, in line with ESMA guidelines, no new indicators were introduced, nor were changes made to the indicators normally used. It should be noted that the definition and calculation methods are provided for each APM; the amounts used are traceable through the information contained in the tables below or in the reclassified financial statements contained in this Consolidated Report on Operations. These formats were constructed on the basis of the financial statements envisaged by Bank of Italy Circular no. 262/2005 and subsequent updates following the same aggregation and classification criteria adopted in the previous year, illustrated in more detail in the section “Income statement and balance sheet reclassification principles” of this Consolidated Report on Operations.

INCOME STATEMENT AND BALANCE SHEET FIGURES

MONTEPASCHI GROUP

2024 ANNUAL REPORT - Consolidated Report on operations

ALTERNATIVE PERFORMANCE MEASURES

MONTEPASCHI GROUP

Cost/Income ratio: ratio between Operating expenses (Administrative expenses and Net value adjustments to property, plant and equipment and intangible assets) and Total revenues (for the composition of this aggregate, see the reclassified income statement).

Return On Equity (ROE): ratio between the Group Net profit (loss) for the year and the average between the shareholders’ equity (including Profit and Valuation Reserves) at the end of year and the shareholders’ equity at the end of the previous year.

Return On Assets (ROA): ratio between the Net profit (loss) for the year and Total assets at the end of the year.

Return On Tangible Equity (ROTE): ratio between the Net profit (loss) for the year and the average between the tangible shareholders’ equity¹ at the end of year and that at the end of the previous year.

Net NPE Ratio: ratio between net non-performing exposures to customers and total net exposures to customers, both net of assets under disposal (excluding government securities).

Gross NPE Ratio²: gross impact of non-performing loans (NPLs) calculated as the ratio between Gross non-performing loans to customers and banks³, net of disposal groups, and total Gross loans to customers and banks, net of disposal groups.

Rate of change in non-performing loans to customers: represents the annual rate of change in Gross non-performing loans to customers based on the difference between annual balances.

Coverage of non-performing loans to customers and coverage of non-performing loans to customers: the coverage ratio on Non-performing loans and Non-performing loans to customers is calculated as the ratio between the relative loss provisions and the corresponding gross exposures.

Provisioning: ratio between the cost of customer credit and the sum of loans to customers and the value of securities deriving from transfer/securitisation of non-performing loans.

Texas Ratio: ratio between Gross non-performing loans to customers and the sum, in the denominator, of the relative loss provisions and tangible shareholders’ equity.

BANCA MONTE DEI PASCHI DI SIENA

REGULATORY MEASURES

MONTEPASCHI GROUP

In determining the capital ratios, the “phase-in” (or “transitional”) version represents the application of calculation rules according to the regulatory framework in force at the reporting date, while the “fully loaded” version incorporates in the calculation the rules as envisaged at full implementation.

Common equity Tier 1 (CET1) ratio: ratio between Common Equity Tier 1 and total Risk-Weighted Assets.

Total Capital ratio: ratio between Own Funds and total Risk-Weighted Assets.

MREL-TREA: calculated as the ratio of the sum of own funds and eligible liabilities to total Risk-Weighted Assets.

MREL-LRE: calculated as the ratio of the sum of own funds and eligible liabilities to the amount of total leverage exposures.

Financial Leverage Ratio: calculated as the ratio between Tier 1 Capital and total exposures, in accordance with the provisions of Article 429 of Regulation 575/2013.

Liquidity Coverage Ratio (LCR): short-term liquidity indicator corresponding to the ratio between the amount of High-Quality Liquid Assets and the total net cash outflows in the subsequent 30 calendar days.

Net Stable Funding Ratio (NSFR): structural 12-month liquidity indicator corresponding to the ratio between the available stable funding amount and the required stable funding amount.

Asset encumbrance ratio: ratio of the total carrying amount of encumbered assets and collateral received reused to total assets and total guarantees received available.

Loan to deposit ratio: ratio between Net Loans to Customers and Direct Funding (due to customers and debt securities issued).

Counterbalancing capacity at spot: sum of items that are certain and free from any commitment that the Group can use to meet its liquidity requirements, consisting of financial and commercial assets eligible for purposes of refinancing operations with the European Central Bank (“ECB”) and assets deposited in the collateralised interbank market (MIC) and not used, to which the haircut, published on a daily basis by the ECB, is prudentially applied.

2024 ANNUAL REPORT - Consolidated Report on operations

Executive summary

A summary of the trend in key items of the main aggregates of the Group as at 31 December 2024 is provided below.

BANCA MONTE DEI PASCHI DI SIENA 

In terms of capital ratios, the Common Equity Tier 1 Ratio stood at 18.3% as at 31 December 2024 (compared to 18.2% as at 30 September 2024 and 18.1% as at 31 December 2023) deducting from capital the dividends for the year determined assuming a pay out ratio of 75% of pre-tax profit, and the Total Capital Ratio stood at 20.6% (compared to 21.4% as at 30 September 2024 and 21.6% as at 31 December 2023).

2024 ANNUAL REPORT - Consolidated Report on operations

Group overview

The Montepaschi Group is the banking hub led by Banca Monte dei Paschi di Siena S.p.a., listed on the Electronic Stock Exchange (Mercato Telematico Azionario) organised and managed by Borsa Italiana S.p.A., with registered office in Piazza Salimbeni 3, Siena, whose activities are focused on traditional retail & commercial banking services carried out mainly in Italy.

The Group is also active in business areas such as factoring, corporate finance and investment banking. The insurance-pension sector is covered by a strategic partnership with AXA while asset management activities are based on the offer of investment products of independent third parties.

The Group combines traditional services offered through the network of branches and specialised centres with an innovative self-service and digital services system enhanced by the skills of the Widiba financial advisor network.

Foreign banking operations are focused on supporting the internationalisation processes of corporate clients in all major foreign financial markets.

COMPANY		ACTIVITIES
		Banca Monte dei Paschi di Siena operates in the different segments of banking and finance, from traditional banking including leasing and factoring products, to special purpose loans, assets under management, bancassurance and investment banking. The Bank performs functions of direction, coordination and control over the Group’s companies, as part of the more general guidelines set out by the Board of Directors in compliance with the instructions provided by the Bank of Italy in the interest of the Banking Group’s stability.
		Monte Paschi Fiduciaria offers its services to private parties and companies that wish to leverage the utmost confidentiality in relation to their interests and business, through the instrument of the fiduciary mandate. In addition, Monte Paschi Fiduciaria can also take on the role of Trust Company for the administration of assets as trustee or guardian (or protector).
		Widiba (WIse-DIalog-BAnking) is the Group’s bank that integrates a self-service offer with the competencies of MPS’s financial advisor network.
		Monte Paschi Banque SA is the Group’s bank that supports commercial trade and investments by Italian companies abroad.

In addition to the above, there are also companies operating in the agricultural sector, both wine and food, with a real estate component destined for agritourism and accommodation activities (MPS Tenimenti Poggio Bonelli and Chigi Saracini Società Agricola S.p.A.) and food custodian and storage services for third parties (Magazzini Generali).

Intragroup transactions primarily regard the financial support from the Parent Company to other companies, for the most part in the form of deposits and outsourced services relative to the auxiliary activities provided by the Parent Company (administrative services and property administration).

The description of the main transactions carried out by the Parent Company with its subsidiaries and associates is provided in Part H of the Notes to the Separate Financial Statements of the Parent Company.

BANCA MONTE DEI PASCHI DI SIENA

Shareholders

As at 31 December 2024, the Parent Company Banca Monte dei Paschi di Siena S.p.A. share capital amounted to EUR 7,453,450,788.44, broken down into 1,259,689,706 ordinary shares.

According to the communications received pursuant to the applicable legislation and based on other information available, as well as based on information on Consob’s institutional website, the entities that, as at 31 December 2024, directly and/or indirectly hold ordinary shares representing a shareholding exceeding 3% of the share capital of the Issuer and which do not fall under the cases of exemption set forth in Article 119-bis of the Issuers’ Regulations are as follows:

BMPS main shareholders as at 31 December 2024  

* Holdings held through Ausonia S.r.l., Esperia 15 S.r.l., MK 87 S.r.l., Istituto Finanziario 2012 S.p.A., Gamma S.r.l., Azufin S.p.A., VM 2006 S.r.l., Mantegna 87 S.r.l., Calt 2004 S.r.l., Finanziaria Italia 2005 S.p.A.

The main changes during 2024, as well as immediately after the end of the financial year, are shown below:

2024 ANNUAL REPORT - Consolidated Report on operations

Information on the BMPS share

The BMPS share closed the fourth quarter of 2024 at EUR 6.81, with period growth of +31.3%, while the FTSE All Share Banks index showed an increase of +3.6% and the FTSE MIB rose by +0.2%. The average daily trading volume of MPS shares was around 15.2 mln over the quarter

SHARE PRICE SUMMARY STATISTICS (from 30/09/2024 to 31/12/2024)

Rating

The ratings assigned by the rating agencies are provided below:

* Long-Term Senior Unsecured Debt Rating

BANCA MONTE DEI PASCHI DI SIENA

Organisational structure

Through its Head Office, Banca Monte dei Paschi di Siena performs functions of direction, coordination and control over the Group’s companies, as part of the more general guidelines set out by the Board of Directors and in the interest of the Group’s stability.

Organisational chart of the Parent Company’s Head Office as at 31 December 2024

The year 2024 was characterised by the completion of the organisational path envisaged in the 2022-2026 business plan on General Management, Territorial Offices and the Commercial Network, as well as some minor organisational interventions.

In January 2024, 50 branches were closed, with the existing customers and relationships being transferred to the same number of merging branches.

In February 2024, a number of steps were taken to optimise the General Management, and in particular, the establishment of the Deputy General Commercial Management to which the Chief Commercial Officer Retail and the Chief Commercial Officer Corporate and Private report.

2024 ANNUAL REPORT - Consolidated Report on operations

In April 2024, some optimisation work was carried out on product specialists and small business customers, in particular:

In June 2024, the AML-CFT function previously allocated to the Chief Risk Officer was transferred to report directly to the Chief Executive Officer.

In July 2024, the transfer of responsibilities related to the Banking Recovery and Resolution Directive (BRRD) from the Transparency Programme staff to the Capital Planning, BRRD, Studies and Research function within the Chief Financial Officer’s department took place.

With respect to Network processes, actions continued to improve the quality of work, free up more time that could be dedicated to sales activities and increase customer service quality, while reducing service response/provision times by streamlining “administrative” activities and document management costs, with a significant effort toward increasing digitalisation of processes.

BANCA MONTE DEI PASCHI DI SIENA

Governance & control systems

Corporate governance

The Parent Company’s corporate governance takes into account the objective of creating a system of coordinated rules and units capable of guaranteeing transparent and accurate management of relations with shareholders as well as between them and the directors and top management.

The Parent Company’s bodies work so as to pursue the overall proper functioning of the business.

By means of a fair and transparent corporate governance system and a shared Code of Ethics, the Parent Company has set rules to ensure that the legitimate expectations of all stakeholders, particularly with regard to environmental, social and governance sustainability profiles, are integrated into the company’s objectives and strategies.

The overall corporate governance system refers to the current code, banking and financial supervisory regulations, the Corporate Governance Code to ensure a clear separation of roles and responsibilities, the appropriate balancing of powers, balanced composition of corporate bodies, effective controls, monitoring of business risks, adequacy of information flows and corporate social responsibility.

The Bank adopts the traditional administration and control model characterised by the presence of a Board of Directors and a Board of Statutory Auditors, appointed by the Shareholders’ Meeting. In addition, there are: In addition, the CEO, who is also the General Manager, and five Board committees, specifically, the Risk and Sustainability Committee, the Appointments Committee, the Remuneration Committee and the Related-Party Transactions Committee and the IT and Digitalisation Committee.

In compliance with the provisions of Italian Legislative Decree no. 231/2001, the Parent Company has also established a 231 Supervisory Body entrusted with the task of supervising the functioning and observance of the Model 231 (namely a compliance model under Law 231) as well as managing its updating.

The Parent Company decided to assign the role of the 231 Supervisory Body to an ad hoc collective body separate from the Board of Statutory Auditors, which is “mixed” in nature and consists of three members, including two outside professionals and one board member who meets the requirements of independence.

The Parent Company’s internal control system is meant to ensure that risks are identified, measured, managed and monitored in such a way so as to enable sound, proper business management in line with pre-established objectives.

Further information on governance, including with regard to the concept of diversity in corporate bodies, is available in the “Report on Corporate Governance and Ownership Structure”, available on the Parent Company’s website (https://gruppomps.it/en/corporate-governance/corporate-governance-report.html).

Risk governance

Risk governance strategies are defined in line with the Group Business Model, medium-term 2024-2028 Business Plan objectives and external regulatory and legal requirements.

Policies relating to the assumption, management, coverage, monitoring and control of risks are defined by the Board of Directors of the Parent Company. Specifically, the Board of Directors periodically defines and approves strategic risk management guidelines and quantitatively expresses the Group’s overall risk appetite.

In fact, the Parent Company’s Board of Directors defines the overall Risk Appetite Framework (RAF) for the Group and approves the “Group Risk Appetite Statement” (RAS) at least once per year.

The RAF Governance process is centralised within the Parent Company, which outlines its relevant perimeter at Group level and defines its structure in Group companies, according to the risks assumed, size and operational complexity of each legal entity. The RAF defines the roles of corporate bodies and functions involved in defining the “risk appetite” and the procedures to be implemented if it becomes necessary to restore the level of risk to the objective or within the pre-established limits.

The RAS represents an essential element in defining the Group’s risk strategy. The RAS is the formal document that contains the explicit declaration of the risk/return objectives/limits (overall, by type and broken down by individual companies/business units) that the Bank intends to assume to pursue its strategies. Therefore, with the RAS, the risk objectives/restrictions are identified and the indicators are broken down by Business Unit/Legal Entity (known as “cascading down” of the Risk Appetite). The objective is to increase the Group’s Risk Culture and fully instil accountability in all relevant business units with regard to achievement of the risk appetite objectives, as required by the regulations and recommended by best practices.

2024 ANNUAL REPORT - Consolidated Report on operations

The Risk Appetite Process is structured so as to ensure consistency with the ICAAP and ILAAP as well as with Planning and Budget and Recovery processes, in terms of governance, roles, responsibilities, metrics, stress testing methods and monitoring of key risk indicators.

In compliance with the guidelines set forth by the Basel Committee and best practices, prudential supervisory provisions for banks require credit institutions to carry out adequate stress testing exercises.

The Group regularly conducts stress tests on all risk factors. Stress tests are used to assess the Group’s capacity to absorb large potential losses in adverse yet plausible market situations, so as to identify the measures necessary to reduce the risk profile and preserve assets.

The Group’s methodological approach to stress-testing is based upon the identification of the main risk factors, both Pillar 1 and Pillar 2, with the objective of selecting events or combinations of events (scenarios) which reveal specific vulnerabilities at Group level.

The results from the stress tests are submitted to the Top Management and Board of Directors. They are formally reviewed by the Board of Directors as part of the approval of the Annual ICAAP/ILAAP Report, with a view to self-assessing the Group’s current and prospective capital adequacy and liquidity and during the year according to a pre-defined internal Stress Test Programme approved by the Board.

Group risk governance is provided centrally by the Parent Company’s Board of Directors, which also supervises and is responsible for the updating and issue of internal policies and the main internal regulations in order to promote and guarantee a continuously greater and more widespread risk culture at all levels of the organisation. Awareness of risks and the correct knowledge and application of the internal processes and models governing those risks - first and foremost for those validated for regulatory purposes - are fundamental requirements for effective, sound and prudent business management.

The Risk Control Function is specifically assigned the task of monitoring the Key Risk Indicators (KRIs), drawing up a periodic report for the Board of Directors and implementing the escalation/authorisation processes in the event that thresholds are exceeded.

The incorporation of macro risk and risk-adjusted performance indicators, consistent with the RAF, within staff remuneration and incentive policies represents an additional tool to promote awareness of the behaviours of all resources and the cultivation of a healthy risk culture.

In reference to the Group’s Risk Culture, during 2024 initiatives were pursued regarding corporate bodies (board induction cycles on specific issues) as well as general training initiatives (online tools) for all personnel in the areas of risk management and mitigation. In collaboration with the Chief Human Capital Officer Department, the Chief Risk Officer Department continued, following on from the previous year, the project aimed at all Group personnel on the topic of “Risk Culture”, through a programme of online classes and eLearning tools in which risk-related issues were presented both in terms of the frameworks adopted by the Bank and in relation to situations reflecting the Bank’s typical operations. Particular attention was paid to new staff in the CRO Department through the provision of a training course structured in several sessions, both in-person and online. The interventions and their contents were then made available on the e-learning platform to enable wider use of the material.

Furthermore, during 2024 internal initiatives proceeded to ensure continued compliance with national and international regulatory provisions.

The ICAAP and ILAAP packages were sent to the Regulator in accordance with the ECB’s regulatory prescriptions regarding the “Technical implementation of the EBA Guidelines on ICAAP/ILAAP information for SREP Purposes” (Supervisory Review and Evaluation Process), as well as in line with the “ECB Guide to the Internal Capital and Liquidity Adequacy Assessment Process (ICAAP/ILAAP)”, issued in November 2018.

In 2024, the Montepaschi Group unveiled its 2024-2028 Business Plan aimed at creating a future-ready bank capable of successfully meeting the evolving needs of customers through a process of corporate and technological innovation supported by a comprehensive investment plan, making the most of the Bank’s talented resources, further enhancing the sustainability of the business, strengthening the balance sheet and focusing on distribution and value creation for all BMPS stakeholders.

The Montepaschi Group is one of the Italian banks subject to the ECB’s Single Supervisory Mechanism. 

BANCA MONTE DEI PASCHI DI SIENA

Compliance systems

Within the broader internal control system, the Compliance Function of the Parent Company autonomously and independently governs non-compliance risk at Group level, periodically reporting to Top Management and Supervisory Authorities on the overall status of compliance of systems, processes and operations.

During 2024, with a view to constantly improving efficiency and keeping up to date with the changing external regulatory framework, the organisational structure of the function was changed. In particular, the former structure that dealt with ICT and Outsourcing issues was reallocated within the DPO (Data Protection Officer) and ICT Advisory staff, while the Control structure on the same issues was upgraded, placing it under the “Compliance, Methodologies and Controls” function. This organisational reorganisation responds to the provisions of the Compliance Plan 2024, with reference to the 40th update of Circular 285/2013. The initiative also responded to the need to strengthen ICT and outsourcing oversight in relation to the upcoming effectiveness (January 2025) of the new EU Digital Operational Resilience Act (DORA) rules for the Financial Sector.

In addition, design and regulatory compliance activities were followed up, with particular reference to:

Lastly, additional activities were also carried out during the year, particularly in matters related to:

2024 ANNUAL REPORT - Consolidated Report on operations

Distribution channels

The Group operates with a view to developing and rationalising its distribution network, by combining regional coverage with the strengthening of innovative channels.

Traditional domestic branches are flanked by specialised sales, which handle relational follow-up and the specific management of particular customer segments (e.g. Small and Medium Companies, Private, Institutions, etc.) and by 567 Financial Advisors (566 as at 31 December 2023) who carry out their activities by having offices open to the public distributed throughout the country.

MONTEPASCHI GROUP - DISTRIBUTION NETWORK ITALY AS AT 31/12/2024          

(*) Reports to the Bank of Italy Supervisory Authority relating to Banca MPS

(**) of which no. 7 reports to the Bank of Italy Supervisory Authority as centre and branch did not coincide.

BANCA MONTE DEI PASCHI DI SIENA

At the end of 2024, the Italian Network had 1,312 branches registered with the Supervisory Authority, with a reduction of 50 branches compared to 31 December 2023, as a result of the closure of these aforementioned branches in January 2024.

At the end of January 2025, there were 1,258 domestic branches⁴, following the closure of 53 branches and the issuance of a licence relating to a specialised centre no longer consubstantial with a branch.

The Parent Company decided to carry out this closure in January, in order to minimize operational potential risks arising from the migration of data in the same date of the accounting closure of the year, and not to create potential inconvenience to customers during year-end holidays.

These closures were made in line with commitments related to State Aid received in 2017.

The Group also makes use of 127 Specialised Centres (also 127 as at 31 December 2023), of which 73 are dedicated to Businesses, 48 to Private customers and 6 to the Family Office.

The Group’s ATM network comprises a total of 2,476 machines (-66 units compared to 31 December 2023), of which 1,993 coincide with traditional branches (1,591 of these are located on premises with an independent entrance also accessible outside of branch hours) and 483 are installed in public places with high operational potential, of which 77 in institutions/companies. There are 1,321 ATM machines with “cash in” functions (of which 917 located in the Self Area, 391 in branches, 1 in institutions/companies and 12 installed in public places).

The Group has an international presence with a Foreign Network geographically distributed in major financial and economic markets and in several emerging countries with high growth rate, with significant trading relations with Italy, currently structured as follows:

In addition to its physical presence across the country, the Parent Company offers banking services to Customers through electronic channels with internet banking products for Retail and Corporate customers. As at 31 December 2024, there were 1,563,215 active users (+91,214 compared to 31 December 2023), of which 1,434,631related to retail customers and 128,584 to corporate customers.

2024 ANNUAL REPORT - Consolidated Report on operations

Customer base

As at 31 December 2024, the Group⁵ had around 3.6 mln customers, substantially stable compared the previous year. Customers as at 31 December 2024 are broken down as follows:

At the end of 2024, the Retention and Acquisition indicators⁶ stood at 94.9% and 4.6% respectively, showing an improvement compared to 2023 (when they were 94.3% and 4.0%, respectively).

BANCA MONTE DEI PASCHI DI SIENA

Reference context

The international scenario

In 2024, economic activity continued to expand, albeit with differing trends between areas. In the US, activity remained robust, while it showed fragility in the euro area, where persistent weakness in manufacturing was compounded by recent signs of a slowdown in services. In China, domestic demand was still affected by the crisis in the real estate market. The recomposition of headline inflation continued due to falling energy prices, although oil and natural gas prices have risen slightly since last autumn. The main monetary authorities have initiated monetary easing, albeit at differing paces. The escalation of international tensions has affected the dynamics of world trade. The global economy remains affected by geopolitics (i.e. Ukraine and the Middle East) and uncertainty over the economic policies to be undertaken by the new US administration.

The US showed a consistent expansion, with GDP growing at around 3% QoQ annualised in the middle quarters of the year before slowing down at the end of the year (+2.3% QoQ after annualising the preliminary figure in the fourth quarter). The disinflationary process that had gained momentum in the middle months of the year has weakened recently: the general price index approached the 3% trend at year-end 2024; core inflation⁷ stabilised slightly above 3% YoY during the year. The labour market, despite some tensions, showed solidity (unemployment has remained just above 4% since spring; new jobs rose at the end of the year) allowing a cautious approach to the Fed in the rate cut process started in September. The newly elected President Trump announced on the campaign trail a number of policy measures such as: the extension of tariffs on foreign imports (first and foremost for China, Canada and Mexico), control of irregular immigration, deregulation of corporations, reform of federal government agencies, tax reduction measures, exit from climate policies; the President also advanced aims of territorial control (i.e. Greenland, Panama, Canada). The translation, albeit only partial, of these announcements into actual measures may have an impact on US and global growth and inflation dynamics.

In the euro area, despite a GDP growth that surprised on the upside in the third quarter (+0.4% QoQ), the business cycle remained weak, registering a zero expansion on a cyclical basis in the fourth quarter (preliminary figure). Activity was kept up by the buoyancy of services, but the manufacturing sector confirmed its fragilities; The slowdown in global trade and, more recently, uncertainties related to US protectionist announcements have conditioned the foreign demand component especially of those countries most exposed to trade with the US. The German economy contracted for the second year in a row. The crisis in the political governance of some major countries in the area (Germany, France) has not yet been overcome. Inflation, which has fallen since the beginning of the year to 1.7% YoY in September, has recently shown signs of a recovery already anticipated by the ECB, which has therefore not changed its monetary easing stance. In December, the general price index still rose to 2.4% YoY; the underlying component remained stable (at 2.7% YoY). The labour market showed resilience with unemployment barely moving from around 6.3% since the summer.

As part of the new European economic governance approved last April, the EU Commission examined the medium-term (four- to seven-year) structural budget plans drawn up by individual countries⁸, after checking their consistency with the reference trajectories sent in June. All the submitted plans (except those of the Netherlands and Hungary) received a positive assessment. The Commission also examined the national budgetary planning documents for 2025 of the member countries, assessing their alignment with the country-specific recommendations sent to each country, as well as their consistency with the public finance targets set out in their structural plans: Only eight countries, including Italy, were in line with the Council’s recommendations. The implementation of individual states’ Recovery and Resilience Plans continued: since 10 October, EUR 39 bn has been disbursed in funding related to individual countries’ NRRPs, bringing the total disbursements to EUR 306 bn. In September, Mario Draghi presented the report on the competitiveness of the EU economy outlining the guidelines for a common EU economic policy strategy.

Among the emerging countries, China hit the government’s 2024 GDP growth target of approx. 5%, but its annual expansion was among the lowest in decades. In the last quarter, GDP growth exceeded expectations (+5.4% p.a.), benefiting from government and Chinese Central Bank policy measures adopted since September, which consolidated the financial framework (debt, stock market, bank balance sheets). Weak domestic demand, influenced by the housing crisis, helped to keep inflation just above zero. Foreign demand has balanced the overcapacity not absorbed domestically, although, the announcements of new duties on products exported to the US are gradually pushing China to reposition exports to other (primarily Asian) markets. In Russia, in the face of sustained growth from the war economy, macroeconomic imbalances have widened. In India, GDP, while slowing down, is expected to expand at an annual rate of more than 6%. Pressures increased with those emerging currencies that are more exposed to the US.

2024 ANNUAL REPORT - Consolidated Report on operations

Italy: economic context

In Italy, growth gradually slowed down during 2024. Manufacturing suffered from falling external demand affected by Germany’s difficulties, while exports slowed down on fears of tariffs. Investment in construction recorded growth in the public component stimulated by the NRRP, which offset the decline in the residential component. The summer rebound in consumption, boosted by low inflation, has resettled. The number of employed people increased, helping to contain unemployment. Annual inflation was below the European average, although it increased slightly at the end of the year (to 1.3% YoY in December); core inflation remained moderate and relatively higher in services. Signs of recovery in the real estate market came in the second half of the year.

The Government’s action in 2024 included a series of measures in the area of taxation, through the changes to the Super-bonus and building bonus and the revision of the IRPEF and IRAP regimes (made structural by the Budget Law 2025), and in the area of business crisis and insolvency, with the supplementary and corrective provisions made to the Code and in the area of two-year composition with creditors. Some of the measures adopted have had an impact on the banking system, in particular with regard to changes, including retroactive ones, concerning the time profiles of tax credits deriving from the so-called ‘building bonuses’ (Superbonus, Bonus Barriere, Sismabonus, etc.), in particular by lengthening (up to 10 years) the time for recovery.

Of note is the introduction of the new “Transition 5.0 Plan”, a programme that aims to support investments in digitalisation and the green transition of companies through an innovative tax credit scheme. Also active, from 1 October 2024, is the “New Sabatini Capitalisation” which aims to support the capitalisation processes of micro, small and medium-sized enterprises, established in corporate form. Among the measures contained in the Budget Law 2025, approved in December, is the provision on the postponement of deductions of write-downs and losses on receivables and goodwill related to DTAs (deferred tax assets), for the two-year period 2025-2026.

Concerning the NRRP, on 18 November 2024 the European Council gave the green light to a request by the government to amend the Plan. The request concerned the adjustment of 21 measures; in some cases, the deadlines for targets and objectives were changed. As part of the Recovery and Resilience Facility, Italy also collected the sixth instalment in December, amounting to EUR 8.7 bn (of which EUR 1.8 bn in the form of grants), bringing the total disbursements received to date to EUR 122 bn. In October 2024, the Ministry for Business and Made inItaly opened a new window for the submission of applications for subsidies for the development of greater energy efficiency and to make production processes more sustainable.

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Financial markets and monetary policy

After a positive start to the year, the stock markets showed high volatility during 2024, reacting to escalating geopolitical tensions. After the summer slumps, the markets started to rise again, helped by monetary easing and the improvement of some economic indicators that dispelled recession fears. In the last quarter of the year, Trump’s election victory further supported US stock markets and, at the same time, conditioned the performance of those of countries exposed to the potential introduction of new tariffs by the US. In Europe, uncertainty over the political governance of some accession countries (e.g. France, Germany) further increased volatility. From the beginning of the year until 31 December 2024, the FTSE Mib gained over 12%; The rise of the Euro Stoxx was more limited (approx. +8%). The rise in the S&P500 was striking (over +23%), while the Nikkei also did well (over +19%). China’s Shanghai Shenzhen CSI 300, which had been suffering for most of 2024, reversed its trend since the end of September in the wake of the adoption/announcement of new domestic growth stimulus measures (close to +15% annual increase).

The upward phase of yields, which had reversed in the summer on inflation targeting expectations and monetary rate cuts, substantially resumed in the last quarter of 2024. The possible slowdown in the return of US inflation, conditioned by the economic policies announced by Trump and the resilience of the US economy, supported the treasury yield back to annual highs in December; This bullish movement partially extended to its German counterpart, whose dynamics were more correlated to Germany’s difficulties. Political/fiscal uncertainties weighed on the rise of the French 10-year bond yield. As at 31 December 2024, the US 10-year rate stood at 4.57% and the German rate at 2.37% (-69 basis points and +34 basis points, respectively, compared to 2023 year-end levels). The Italian 10-year rate from the second half of 2024 showed a down-ward trend and, although it rose in December, it closed the year at 3.52% (-18 basis points from its year-end 2023 values). The BTP-Bund spread, despite some volatility, narrowed during the year, settling at around 116 basis points at 31 December 2024 (-52 basis points compared to year-end 2023); the spread benefited from the ratings of Fitch and DBRS, which in October, while confirming Italy’s BBB rating, improved its outlook from stable to positive.

After the summer, the Federal Reserve began the phase of monetary easing: in September reduced interest rates (-50 basis points) for the first time after four years of stability; It subsequently made further reductions of 25 basis points at both its November and December meetings, thus lowering the cost of money in the range of 4.25-4.50%. However, due to the upside risks on domestic inflation and the robustness of the US economy and labour market, the rate cut decision was not unanimously supported by the FOMC members at the year-end meeting⁹. At its first meeting in 2025, the Fed confirmed its cautious stance by deciding to leave rates unchanged. The markets, for the most part, have been affected by an extension of the current pause in the monetary rate reduction process to the first half of 2025.

The ECB, having made significant changes to the operational framework for the implementation of monetary policy in March¹⁰, started a cycle of rate cuts in mid-year, making cuts of 25 basis points at its meetings in June, September, October and December. As a result, the Monetary Authority raised the rate on the main refinancing operations to 3.15%, the rate on deposits with the ECB to 3.00% and the rate on the marginal lending operations to 3.40% at the end of 2024. At the December meeting the possibility of a 50 basis point cut in key interest rates was discussed, on the strength of a disinflationary process well under way, but a unanimous consensus prevailed among ECB members towards a more cautious solution. Monetary easing continued in early 2025 with the ECB, which at its January meeting, as expected, unanimously cut monetary rates by a further 25 bps (bringing the deposit rate to 2.75%), showing its confidence in achieving the inflation target in the short term. Regarding the macro picture, the Authority confirmed the downside risks on growth. The ECB will continue to follow a data-dependent approach in calibrating the correct monetary policy (which is still referred to as ‘restrictive’) in meeting after meeting. The markets expect a continuation of the rate cuts at the upcoming meetings.

The recomposition of the ECB balance sheet continued. The portfolios of the APP (Asset Purchase Programme) and the PEPP (Pandemic Emergency Purchase Programme) are shrinking at a measured and predictable pace, as the Eurosystem no longer reinvests the repaid principal on maturing securities. On 18 December 2024, with the repayment of the remaining amounts received by the banks under the targeted longer-term refinancing operations, this part of the balance sheet normalisation process came to an end.

2024 ANNUAL REPORT - Consolidated Report on operations

Significant events in 2024

On 7 February 2024, the Parent Company announced new top management appointments in a number of key functions with the enhancement of the assets of internal resources. More specifically, in addition to the appointment of Maurizio Bai as Deputy General Manager, Fiorella Ferri was appointed as Chief Human Capital Officer, Alessandro Giacometti as Chief Operating Officer, Vittorio Calvanico as Chief Safety Officer, and finally Marco Tiezzi assumed the role of Chief Commercial Officer Retail.

On 29 February 2024, Standard Ethics improved the short-term outlook of Banca Monte dei Paschi di Siena, from “Stable” to “Positive”. The ratings agency highlighted the Bank’s commitment to the integration of ESG criteria, confirming the “EE” rating and anticipating a potential upgrade to “EE+” within 12-24 months, following the implementation of the 2022-2026 Business Plan and the new Sustainability Plan.

On 8 March 2024, Banca MPS successfully completed the placement of a new senior preferred unsecured bond issue with a 5 year maturity (with early repayment option after 4 years), for an amount of EUR 500 mln and a coupon set at 4.75%.

On 11 April 2024, the Ordinary Shareholders’ Meeting of Banca Monte dei Paschi di Siena was held, which included, among other resolutions, the 2023 Financial Statements, payment of the dividend, the remuneration policies, incentive plans and the appointments of Raffaele Oriani as director, Giacomo Granata as acting statutory auditor and Paola Lucia Giordano as alternate statutory auditor.

On 16 April 2024, Banca MPS successfully completed the placement of a covered bond issue, the first after the transposition of the European harmonisation directive on covered bonds, with a maturity of five years, aimed at Italian and foreign institutional investors, for an amount of EUR 750 mln and a coupon set at 3.5%.

On 22 May 2024 (ex-dividend date 20 May and record date 21 May), the dividend for 2023 was paid for a total of EUR 314,922,426.50, corresponding to 0.25 eurocents for each of the 1,259,689,706 ordinary shares without par value outstanding at the record date.

On 13 June 2024, the Parent Company’s Board of Directors approved an exclusive agreement with a private equity fund for the sale of 100% of the subsidiary Monte Paschi Banque S.A. On 9 December 2024, the parties signed an agreement that allowed them to initiate the trade union consultation, required by the French Commercial Code, which is obligatory in order to be able to sign the sale and purchase agreement once it has been finalised. The procedure involves the subsidiary and consists in informing the works council (‘Comité Social et Economique’ or ‘CSE’) in advance of the planned transaction, the reasons for it and any impact on employees. Upon completion of the trade union consultation and once the relevant non-binding opinion of the CSE has been obtained, the Parent Company will be able to proceed with the transaction, which is expected to be finalised during 2025.

On 9 July 2024, Banca MPS successfully completed the placement of its first Social Conditional Pass Through (“CPT” European Covered Bond issue with a maturity of 6 years (16 July 2030), targeting Italian and foreign institutional investors, for a total of EUR 750 mln and fixed coupon of 3.375%.

On 5 August 2024, the Parent Company approved the 2024-2028 Business Plan, with an update of the financial targets, after overshooting the main objectives of the previous 2022-2026 Plan, and the strategic guidelines to strengthen its positioning as a “Clear and Simple Commercial Bank” through a digital-driven transformation and a growing specialisation of the service model for households and businesses.

On 7 November 2024, the Parent Company signed contracts for the non-recourse sale of a portfolio of impaired loans as part of the so-called “Bricks” project for a total gross exposure of approximately EUR 0.3 bn, of which EUR 0.2 bn related to secured bad loans and EUR 0.1 bn related to unsecured bad loans. The deconsolidation of the portfolio took place in December 2024.

On 20 November 2024, Banca MPS successfully completed the placement of a new Senior Preferred Unsecured bond issue, with a term of 6 years (maturing in 2030) and with an early redemption option after 5 years, for an amount of EUR 750 mln and a coupon set at 3.625%.

On 11 December 2024, the Bank received notification of the European Central Bank’s final decision regarding the capital requirements to be met on a consolidated basis as of 1 January 2025, at the conclusion of the annual prudential review and assessment process conducted in 2024. The additional “P2R” capital requirement improved by 25 bps from 2024 levels (2.75%) to 2.50%.

The overall minimum Common Equity Tier 1 ratio stands at 8.78%, the sum of Pillar 1 - P1R (4.50%), Pillar 2 - P2R (1.41%) and Combined Buffer Requirement - CBR (2.87%). The Pillar 2 Capital Guidance “P2G”, set at 1.15%, is unchanged from 2024 levels.

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Compared to the 2023 Final Decision, the ECB removed the prior authorisation requirement for the distribution of dividends.

On 12 December 2024, the Board of Directors of Banca MPS unanimously appointed - with the abstention of the interested party - the independent Director, Ms. Paola De Martini, as Lead Independent Director of the Bank.

On 17 December 2024 , the independent directors Paolo Fabris De Fabris, Lucia Foti Belligambi, Laura Martiniello, Annapaola Negri-Clementi and Donatella Visconti - indicated by the Ministry of Economy and Finance in the list presented on 27 March 2023 - resigned.

Following the aforementioned resignations, on 27 December 2024 the Board of Directors of Banca MPS, proceeded, by unanimous vote and with the positive opinion of the Board of Statutory Auditors, to appoint by co-optation: Alessandro Caltagirone (non-independent), Elena De Simone (non-independent), Marcella Panucci (independent), Francesca Renzulli (independent) and Barbara Tadolini (independent).

The new Board members will remain in office until the next Shareholders’ Meeting called to decide on the confirmation of the co-opted Board members.

In view of the changes in the Bank’s shareholding structure, as a result of the gradual reduction of the shareholding held by the Ministry of Economy and Finance, the selection of the names of the new directors by the Appointments Committee took place following a specific process of dialogue with some of the Bank’s new shareholders and with the support of a selection company.

Significant events after the end of 2024 financial year

On 3 January 2025 and 10 February 2025, Banca MPS announced (in line with the funding plan and after receiving the authorisations from the European Central Bank) the exercise, on 22 January 2025 and 2 March 2025 respectively, of the full early repayment option of the Tier 2 subordinated bond called “€400,000,000 8.000 per cent. Reset Callable Subordinated Notes” and of the senior bond called “€750,000,000 Fixed to Floating Rate Callable Senior Notes due 2 March 2026”.

On 28 February 2025, Standard Ethics upgraded the Corporate Standard Ethics Rating (SER) of Banca MPS from the previous “EE” to “EE+”. The rating agency confirmed that the upgrade to ‘EE+’ (Very Strong) leads to the achievement of the expected long-term rating and the outlook remains positive.

Voluntary public exchange offer on the ordinary shares of Mediobanca - Banca di Credito Finanziario Società per Azioni promoted by Banca Monte dei Paschi di Siena S.p.A.

On 23 January 2025, the Board of Directors of Banca MPS approved the launch of a voluntary Public Exchange Offer (the “Offer”) on all the ordinary shares of Mediobanca - Banca di Credito Finanziario Società per Azioni (“Mediobanca”). The Offer is conditional upon obtaining the relevant regulatory authorisations and meting the conditions indicated in the disclosure to the market of 24 January 2025, which will be further detailed in the Offer Document.

The share exchange ratio was set at 2.300 newly issued Banca MPS shares to each existing Mediobanca share of Mediobanca, for an implied Offer price of EUR 15.992 per share with a premium of 5.03% over the official prices at 23 January 2025.

The success of the Offer will allow an acceleration in the utilisation of the DTAs held by Banca MPS, with an estimated net present value to the benefit of Mediobanca’s shareholders participating in the Offer of EUR 1.2 bn, equal to approximately 10% of Mediobanca’s current market value.

The purpose of the Offer is to create a new national champion in the Italian banking sector, ranking third in key business segments, through the industrial combination of two of the main players in the sector MPS in Retail/Commercial Banking and Mediobanca in Wealth Management, Corporate & Investment Banking (CIB) and Consumer Credit. In particular, the new Group will distinguish itself as:

2024 ANNUAL REPORT - Consolidated Report on operations

The acquisition of Mediobanca accelerates the implementation of the strategic guidelines of Banca MPS’s 2024-2028 Business Plan, which focuses on: i) the growth of specialised businesses that generate high commission flows; ii) the development of new dedicated service models for value-added activities; iii) the expansion of lending solutions for households and the development of new services for SMEs; iv) the renewal and optimisation of distribution platforms and (v) the adoption of a zero-based approach to risk.

The transaction has clear and tangible benefits for all stakeholders involved:

Shareholders: high value creation for both Banca MPS and Mediobanca shareholders through increased profitability, with a dividend pay-out of up to 100% of net profit, while maintaining strong capital strength. In addition, the transaction will accelerate the utilisation of Banca MPS’s DTAs and generate significant industrial synergies;

Customers: access to a value proposition of excellence, with a broader and more attractive range of products, tailor-made solutions and services for households, enterprises and SMEs and a multi-channel platform with complementary distribution networks;

Employees: opportunities for professional growth in an environment with a strong capacity to retain, attract and develop professional talent;

Italian economy and community: strong value for the country system by helping to increase its competitiveness. An engine for the development of projects and initiatives in the territories for the benefit of local economies, continuing to be a reference model in terms of sustainability.

Banca MPS aims to achieve significant profitability and maintain strong capital strength, also thanks to the contribution of expected industrial synergies and DTAs. In particular, it is expected: (i) pro-forma RoTE at about 14%, (ii) pro-forma CET 1 ratio at about 16%; (iii) Accelerated utilisation of DTAs and (iv) approximately EUR 700 mln of pre-tax synergies per year.

The transaction will make it possible to benefit from the value of Banca MPS’s DTAs by leveraging a higher consolidated tax base. The new Group will, in fact, be able to accelerate the utilisation of EUR 2.9 bn of DTA over the next six years, with EUR 0.5 bn per year and a significant capital benefit. In addition, the new Group will benefit from pre-tax synergies of approximately EUR 700 mln per year, of which approximately EUR 300 mln from revenue synergies, approximately EUR 300 mln from cost synergies and approximately EUR 100 mln from funding synergies. Revenue synergies will be realised by expanding the range of products and services and strengthening competencies in the different business areas (e.g. consumer credit, mortgages and asset gathering), together with increased penetration in key segments (e.g. SMEs). Cost synergies are expected to be achieved through measures to optimise central functions, to be related to IT expenditure and to occur through the reduction of administrative expenditure. Funding synergies will be realised through the improvement of the wholesale financing structure, also taking advantage of the commercial financing capabilities of Banca MPS. As part of the transaction, the Group expects integration costs of approximately EUR 600 mln before tax to be incurred in the first year of operation. Significant benefits are expected for the shareholders of both banks with the distribution of a sustainable and growing Dividend per Share (DPS) over the period:

The Public Exchange Offer is expected to be completed by the third quarter of 2025.

On 13 February 2025, the Parent Company filed the Offer Document with Consob, which will be published upon completion of the preliminary investigation carried out by the Authority pursuant to Article 102, paragraph 4, of the Consolidated Law on Finance (TUF). On the same date, Banca MPS submitted the following to the competent authorities: (i) the petitions to obtain the authorisations required by the sector regulations in relation to the Offer pursuant to Article 102, paragraph 4 of the TUF and Article 37-ter, paragraph 1, letter b) of the Issuers’ Regulations, and (ii) the notifications/communiques on antitrust and golden power matters.

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Human Resources

Consistent with the objectives and time lines of the Business Plan, in 2024, the main features of the HR measures concerned: activation of career paths and definition of key roles with a focus on the sales network; multidimensional training model oriented towards risk-based logic with a training plan entirely financed by industry funds; human capital development plans consistent with the company’s strategic objectives; consolidation of the corporate welfare system; enhancement of inclusion with a plan on Diversity & Inclusion. In addition, with the achievement of Group targets and after the approval of the previous year’s financial statements, the year 2024 was characterised by the disbursement of the company bonus - defined by a trade union agreement that also provided for its disbursement in “welfare” - and incentive systems. The latter represent a strategic lever for the enhancement of human capital, ensure sustainable development in the ESG (Environmental, Social and Governance) through the adoption of incentive parameters correlated to the achievement of the Group’s strategic guidelines on these issues, they ensure alignment between the management and the interests of shareholders and investors in view of the challenging objectives to be achieved.

KPI as at 31 12 2024

Headcount changes

As at 31 December 2024, the Group had a total of 16,727 active employees, down 10 units compared to 31 December 2023. The dynamics are mainly attributable to:

The distribution at year-end 2024 of the workforce stood at 67.6% in front-office units (Branches and Specialised Centres) and 32.4% for Head Office units and Regional Departments.

Personnel management initiatives

The personnel management policies support and consolidate the reorganisation projects, in line with the objectives of the new Business Plan, through mobility plans (professional and regional) with a view to development opportunities for employees and according to logics of transparency, participation and inclusion.

More specifically, the corporate programme of people development (MPS Sviluppa) is designed to meet different corporate needs in terms of professional requirements and responds to the aim of increasing the skills, professional capabilities, motivation and engagement of individuals. The programme is guided by the principles of equal opportunities and accessibility of training and development activities, consistent with the provisions of the Code of Ethics and the document “Rules on Inclusion”.

In 2024, staff development initiatives were consolidated and evolved to also accompany the transition phase between the Group’s 2022-2026 Business Plan and the Group’s 2024-2028 Business Plan” emphasising the latter’s “human component”. To this end, the professional and managerial development initiatives and tools were partly redesigned and enriched, with the intention of giving the programme further coherence and increasing the coverage of the company’s population with a view to the entire Business Plan.

2024 ANNUAL REPORT - Consolidated Report on operations

Key measures implemented as part of MPS Sviluppa included:

To better support the achievement of the Business Plan objectives, the new version of the evaluation system was released during 2024. The review, while maintaining elements of continuity with the previous system, will broaden the overall view of the person being evaluated, with the integration into the evaluation factors of role-specific activities and behaviours consistent with the Group’s soft skills model that stems from the corporate Code of Ethics. The process will also support the professional development of resources to be “leveraged” through horizontal or vertical development indications proposed by the line manager and confirmed by the management and business system.

Welfare plays a central role in Level II Contract Negotiations, for which the discussions on renewal are ongoing. For the most important institutions, it has also been extended to the human resources participating in the sector’s solidarity fund and for the entire period of their permanence therein. Thanks also to the constant dialogue within the context of the relevant Joint Committee, welfare has consolidated its structure in a complex of constantly evolving contractual institutions, differentiated according to the requirements - traditional and new - of employees in the area of:

Initiatives and activities in the Diversity & Inclusion area continued in 2024, in line with the path of leveraging diversity, recognised as a strategic driver for the development and dissemination of an inclusive corporate culture. Following the obtaining of the Gender Equality Certification, the Gender Equality Management System was overseen, in accordance with the UNI/PdR 125:2022 Reference Practice, with a specific focus on: communication plan, training plan, internal audit system, non-compliance management and management of a Gender Equality Strategic Plan, approved by a special Steering Committee and updated periodically.

An inclusive culture is valued by the Group, it develops flexibility and innovative skills, increases the motivation of people in the company and interest in new generations, with a consequent positive impact for the business. These principles - in line with the additions to the Code of Ethics and specified in the document “Rules on Inclusion” - are communicated to all stakeholders in the “Gender Equality Policy”; The document in which the Group notifies all stakeholders of their commitments in terms of valuing diversity, inclusion, equity and parity that the Company aims to pursue in all phases of the professional life of each person, in terms of organisational and operational aspects, internal and

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external communication and their relationship with the local area. Consistent with what was stated therein - including “zero tolerance” of violence and harassment in the workplace - a process for handling reports of inappropriate behaviour, defined in the document “Rules on preventing and combating gender-based harassment in the workplace”, was developed. The shortened version of the document has been published on the Group’s website, available to all stakeholders.

In order to disseminate the principles of the “Inclusion Rules” document and the “Gender Equality Policy”, further editions of “Management Plurale”, the training workshop aimed at all managers, were carried out; On gender-specific topics, “Growth Together” was held, a development of the earlier “Women Leadership Programme”, a course aimed at women in leadership roles; the collaboration with “Valore D” continued with the participation in inter-company training courses. The Parent Company was also confirmed as a supporter of the project “D&I in Finance”, aimed at consolidating the actions undertaken by the banking and financial industry and other business entities in favour of inclusion, equity and valuing diversity. The issue of Diverse Abilities was addressed with dedicated analyses by continuing participation in the Disability Lab (an inter-company workshop set up as a natural continuation of the “Disability and Work” research project in collaboration with Fondazione Istud) and by means of info-training meetings involving, on the basis of self-nominations, the entire company population. At the end of the meetings, a Manifesto was drawn up and published on the company intranet, summarising the commitments that the Parent Company intends to pursue in this area. In line with the Manifesto, training courses were implemented for managers. The activities are subject to continuous discussion within the Equal Opportunities Commission.

The initiatives of MPS Orienta, the programme that encompasses the activities that the Parent Company devotes to career guidance, the development of soft skills, financial education and, in general, relations with schools and universities. The aim of the programme is to promote employer branding, strengthen the link between education and the world of work, support the country’s economic and social development, contribute to sustainable growth strategies and strengthen relations with customers and the area in which the Group operates. The main initiatives are aimed at:

The management plans were based on the objectives dictated by the Business Plan, in particular:

The ordinary activities of human capital management and the various projects continue to maintain the objective of pursuing the best allocation of resources and maximising engagement, accompanying execution with the use of all internal communication channels as well as with a programme of individual interviews to discuss the main drivers and expected benefits.

2024 ANNUAL REPORT - Consolidated Report on operations

Internal communication supports the sharing of Group strategies in line with the 2024-2028 Business Plan, protects the corporate identity and disseminates its values. The corporate functions share with internal communication the information and involvement needs of colleagues in order to translate them into editorial plans based on the integrated use of internal channels in connection with recurring or extraordinary activities.

In the course of 2024, specific multi-channel communication plans were implemented to spread awareness of key cross-cutting issues:

The year 2024 was characterised by the evolution of the training platform (MPS Academy) with the integration of analysis tools (“Skill gap analysis” questionnaires) that consolidate the application of the 3D Approach training framework. These tools, combined with the use of training courses, allow for tailor-made training programmes, i.e. customisation of enrolments in the courses by role with the same total duration.

In 2024, approximately 690,000 hours of training were provided at the MPS Group level, or 41 hours per capita. The training activity covered about 99% of the personnel and is continuously followed-up jointly with the trade unions, including within the Joint Training Body.

In order to promote the spread of risk culture and to highlight the value created by training initiatives in terms of covering processes and monitoring business risks, a single training framework has been implemented for some years enabling each training activity to be associated with one or more business processes/risks from the design phase. This framework ensures “tailor-made” training in high-risk areas (e.g. Credit, Anti-Money Laundering and financial crimes, Customer Protection and Transparency, Data Governance and Cyber Security) conducted following a Risk Assessment and Skills Gap Analysis exercise that determines the exposure to risk (known as the “risk rating”) for each company role and the consequent specific training requirement, directing training on the areas at greatest risk and on the most exposed company profiles and which therefore require greater knowledge. In addition, by value enhancing the potential of the 3D model and continuing its development, a new training system was finalised on the 231/01 model, which strengthens awareness and control of risk. In continuity with what had already been started in previous years, the multimedia training on risk culture, dedicated to all staff, continued in 2024, through a series of courses with monthly publications on different topics relating to different fields of risk: from ESG sustainability to operational risks, anti-money laundering and privacy issues.

Lastly, for programmes directed to key and strategic roles, a Board Induction event was held for all members of the BoD and the Board of Statutory Auditors on the topic of Cybersecurity.

Finally, Health and Safety training was intensified by focusing on the provision of specific courses for emergency workers, supervisors and managers, workers’ representative for health and safety (Rappresentante dei Lavoratori per Sicurezza, RLS), trade union representation (Rappresentanza Sindacale Aziendale, RSA), achieving almost total training coverage.

With reference to remuneration policies, it should be noted that they promote sustainable performance, the achievement of short- and long-term strategic objectives and employee loyalty, enhancing merit, skills and professional growth. The definition of gender-neutral remuneration structures reflects these orientations and is carried out in correlation with applicable market practices by using the weighting of company positions, which allows for a continuous and more accurate assessment of both internal equity, through verification of the consistency of the remuneration packages of resources at the same classification level, and external competitiveness, through comparison with the market.

Remuneration and incentive policies also represent an important managerial lever to guide management and staff towards inclusive and widespread leadership, as well as a strategic lever in pursuing the goal of achieving sustainable value, by appropriately balancing and sizing the variable component of remuneration with respect to the fixed component and ensuring that the variable part of remuneration is connected, among other things, to performance parameters tied to ESG objectives.

The Group’s remuneration and incentive policies are described every year in the “Report on the remuneration policy and on compensation paid”, prepared under Article 123-ter of the Consolidated Law on Finance (TUF) and subject to approval by the Shareholders’ Meeting.

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2024-2028 Group Business Plan

During the previous year, Banca MPS achieved, ahead of schedule, the Group’s key economic and financial performance indicators defined in the 2022-2026 Strategic Plan, launching a series of initiatives that laid the foundations for further improvements in performance over time. In light of the results already achieved and the evolving macroeconomic environment, it was deemed appropriate to develop the new 2024-2028 Strategic Plan.

On 5 August 2024, the Board of Directors of the Parent Company approved a new Business Plan for the period 2024-2028, “A Clear and Simple Commercial Bank Revolving Around Customers, Combining Technology With Human Touch”, which targets a Bank capable of successfully satisfying evolving customer demands through a process of corporate and technological innovation supported by a broad investment plan, fully leveraging talent, further improving business sustainability, strengthening financial statements and focusing on the distribution and creation of value for all stakeholders. The Plan is structured on five key pillars:

2024 ANNUAL REPORT - Consolidated Report on operations

Enabling factors: Technology

The implementation of the Plan’s distinctive initiatives will be made possible and accelerated by digitalisation and the adoption of new technologies, according to the following key proposals:

The comprehensive IT development plan is supported by investments of EUR 500 mln in the period 2024- 2028.

Enabling factors: Talented Human Resources

The plan for digitalisation and the widespread adoption of technological innovation, the foundation of the 2024-2028 Business Plan, will make it possible to create a virtuous circle that enhances the Bank’s human capital, which has always been at the heart of the BMPS development strategy.

In this context, a dedicated retraining programme will be launched that will enable more than 1,300 high-potential professionals to be trained for high value-added activities. At the heart of human capital development is the BMPS Academy, a key tool for strengthening employees’ skills through dedicated and intensive training programmes, providing tools to focus on high-priority areas, also in a digital logic and with a focus on spreading the culture of risk at all organisational levels, to ensure its effective control.

The Plan also envisages the recruitment of around 800 resources with distinct skills in high-priority areas such as IT and Advanced Analytics/GenAI.

Finally, the Bank will provide for the strengthening of incentive and compensation systems, closely linked to performance, by reinforcing merit recognition initiatives, with the aim of enhancing the attraction, identification and retention of talent.

The Plan will also make it possible for the Group to further accelerate the path towards a sustainable business model, the result of a long-standing commitment and the objective of achieving a distinctive position in the management of ESG issues, supporting customers in the imminent “green” transformation process and contributing to the creation of a society

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based on sustainability, equality and inclusion. For more information on strategies to strengthen the Group’s ESG positioning, please refer to the “Sustainability Reporting” section of this Report on Operations.

Key financial targets 2024-2028

As a result of the implementation of the Plan’s initiatives, pre-tax profit is expected to grow from EUR 1.3 bn in 2024, to EUR 1.42 bn in 2026 and EUR 1.657 bn in 2028. This expected result is a function of the following components:

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In terms of economic targets, the 2024 result is above the Plan targets due, in particular, to higher revenues and lower operating expenses. On the credit front, the objectives of both ordinary destocking and restoration to performing status, in addition to the contributions from disposal operations (finalised in the latter part of the year), allowed the Gross NPE ratio to be contained at Plan levels (despite the uncertain macroeconomic context due also to geopolitical tensions) with a cost level slightly below Plan expectations. In relation to legal risks, 2024 shows an overall low level of provisions. As a result of the economic trends described above, the profitability indicators (Cost income, ROE, ROTE) were all better than the Plan forecast. The Group also achieved a CET1 ratio of 18.2 % (fully loaded) as at 31 December 2024, above the Plan and among the best levels in the banking system. The strengthening of Banca MPS’s performance and its capital level, together with the improvement in asset quality and new access to the debt market, led rating agencies to upgrade the Bank’s rating.

2024 ANNUAL REPORT - Consolidated Report on operations

Commercial strategy

Sales strategies in 2024, in continuity with the process already started, directed the business towards core areas to relaunch the Group’s economic performance, confirming customer support, and towards a more sustainable development model. Below are the main strategic initiatives for Retail and Corporate service models.

Retail: The Parent Company focuses its activities on four business areas to serve private customers and Small Businesses (in Italian “Piccoli Operatori Economici” or POEs), innovating its range of products and services: consumer credit, mortgages, managed savings and bancassurance.

Corporate: MPS intends to focus the development of the corporate segment on two priority sectors (agribusiness and green transition) and on a selected range of products: subsidised and secured finance, factoring and fee-based services.

For more information on the initiatives implemented by both service models during the year, please refer to the section “Results by Operating Segment” included in this Report on Operations.

BANCA MONTE DEI PASCHI DI SIENA

Funding strategy

The 2024-2028 Group Liquidity and Funding Plan defines the guidelines for management of the Group’s liquidity and funding over a long-term horizon, to support the development and objectives outlined in the Plan. For each of the forward-looking maturities, starting from the business plan and the developments expected from the imbalance created, it outlines the methods for obtaining cash and the counterbalancing capacity necessary for the processes to function in the short term, at the same time guaranteeing structural balance in the funding profile and medium/long-term business development. The maturity profile over the 2024-2028 time horizon is mainly represented by ECB auctions, which, as at 31 December 2024, amounted to EUR 8.5 bn (EUR 9 bn as at 30 September 2024, EUR 12 bn as at 30 June 2024 and EUR 13 bn as at 31 December 2023) consisting of LTRO auctions of EUR 5 bn and MRO auctions of EUR 3.5 bn. In the period 2024-2028, the other maturities are represented by institutional bonds, totalling approximately EUR 5.8 bn to be repaid, of which:

In January 2025, the call of the Tier2 subordinated bond with a nominal value of EUR 0.4 bn issued in January 2020, with original maturity 2030, was exercised. In March 2025, the call of the senior unsecured bond with a nominal value of EUR 0.75 bn issued in February 2023, with original maturity in 2026, was also exercised. The call of an additional subordinated Tier2 bond issued in September 2020, with original maturity also set in 2030, and nominal value of EUR 0.3 bn, may also be exercised during the year. In 2026, the call of a senior unsecured bond of EUR 0.5 bn (final maturity in 2027) may be exercised and in 2028, the call of a senior unsecured bond of EUR 0.5 bn (final maturity is in 2029) may be exercised. Considering the call of the bonds with original maturities in 2029 and 2030, which will take place according to the cost effectiveness in terms of spread/replacement rate, the liquidity/capital position and in any case subject to prior authorisations from the competent Supervisory Authorities (SRB/ECB), the total institutional bonds maturing over the Plan horizon (starting from the last quarter of 2024) amount to a total of approximately EUR 7 bn, including the call already exercised in January 2025.

In relation to bond issue activities, four placements were made in the course of 2024 for a total of EUR 2.75 bn. Specifically, the Parent Company issued: (i) in March 2024, a senior preferred bond of EUR 0.5 bn, maturing in March 2029, callable in March 2028 and bearing a coupon of 4.75%; (ii) in April 2024, a covered bond of EUR 0.75 bn with a maturity of April 2029 and a coupon of 3.5%; (iii) in July, the first social European covered bond with a 6-year maturity, for EUR 0.75 bn and a coupon of 3.375%; (iv) and in November, a senior preferred bond of EUR 0.75 bn, maturing in November 2030, callable in November 2029 and with a coupon of 3.652%.

Against the scheduled maturities, the Group’s funding strategies aim to maintain liquidity indicators at adequate levels, broadly above regulatory limits, as well as guarantee - as concerns public bond issue plans in particular - the satisfaction of liquidity ratio and MREL requirements. The 2024-2028 Group Liquidity and Funding Plan will in any case require annual implementation, as appropriate, which will illustrate in greater detail the actual actions to be taken during the reference year and the authorisations to the operating structures for their implementation.

Commitments related to the State Aid received in 2017

On 3 October 2022, the European Commission published a review of the commitments already set forth in the previous 2017-2021 Restructuring Plan, updating them as follows:

2024 ANNUAL REPORT - Consolidated Report on operations

BANCA MONTE DEI PASCHI DI SIENA

In March and November 2024, the MEF finalised, in two separate transactions, the sale of its 27.5% stake in the share capital of Banca MPS and, therefore, at the reporting date of these financial statements, the MEF’s stake in Banca MPS stood at approximately 11.7% of the share capital, with the fulfilment of commitment #12.

Therefore, as foreseen in commitment #12 and as officially communicated by the European Commission itself, commitments #1 (Ban on Acquisition), #5 (Remuneration of Bank employees and managers), #9 (Operating costs), #10 (Total assets target), #11(Loan to deposit ratio) and #19 (Closure of foreign branches) ceased as a consequence of the above-mentioned divestment.

As at 31 December 2024, the Parent Company was substantially in compliance with its commitments.

In the course of 2025, the formal closure of the commitments by the European Commission is expected, following the release of the Monitoring Trustee’s report based on financial data for the last quarter of 2024.

2024 ANNUAL REPORT - Consolidated Report on operations

Income statement and balance sheet reclassification principles

The balance sheet and income statement are shown below in reclassified form according to management criteria in order to provide an indication of the Group’s general performance based on economic and financial information that can be quickly and easily determined.

A disclosure is provided below on the aggregations and main reclassifications systematically performed with respect to the financial statements established by Circular no. 262/05. The breakdown of these aggregations and reclassifications are provided, with separate statements, in the annexes to this file, also in compliance with the requirements of Consob Communication no. 6064293 of 28 July 2006.

Note that from 30 June 2024, given the negotiations in progress with a potential buyer, the subsidiary Monte Paschi Banque S.A. (hereinafter MP Banque) was classified as a discontinued operation and therefore measured at the expected sale price, lower than its net book value pursuant to IFRS 5. As at the date of this report, the MP Banque valuation according to the aforementioned standard resulted in the recognition of a EUR -36.4 mln impact (before tax) among restructuring costs. excluding this effect, the subsidiary contributed positively to the Group’s profit for approximately EUR 14.4 mln. Consequently, as at 31 December 2024, for continuity with the published comments and to facilitate understanding of the economic and financial trends for the quarters of the current year and corresponding comparative periods, costs and revenues as well as assets and liabilities referring to the consolidated contribution from the subsidiary MP Banque, though classified as a discontinued operation pursuant to IFRS 5, are included on a line-by-line basis in the individual income statement and balance sheet items.

Lastly, note that the balance sheet and income statement figures for the first and third quarters of 2024 and the corresponding comparative figures referring to the insurance associates AXA MPS Assicurazioni Danni S.p.A. and AXA MPS Assicurazioni Vita S.p.A., are estimated by them using proxies or simplified calculation models, given the greater onerous nature of the accounting calculations under IFRS 17 and IFRS 9.

Income statement data

BANCA MONTE DEI PASCHI DI SIENA

2024 ANNUAL REPORT - Consolidated Report on operations

Balance sheet data

BANCA MONTE DEI PASCHI DI SIENA

2024 ANNUAL REPORT - Consolidated Report on operations

Reclassified income statement

BANCA MONTE DEI PASCHI DI SIENA

Quarterly trend in reclassified consolidated income statement

2024 ANNUAL REPORT - Consolidated Report on operations

Revenue trends

As at 31 December 2024, the Group achieved total Revenues of EUR 4,034 mln, up by 6.2% compared to the previous year.

This trend is mainly due to the growth in the Primary Net Interest, which increased both on the Net Interest Income (+2.8%) and on Net Fee and Commission income (+10.8%); Other Revenues from Financial Operations also increased (+21.6%), positively impacted by the significant growth in trading income.

In the fourth quarter of 2024, the growth in Net Fee and Commissions income was more than offset by the dynamics of Net Interest Income, which was influenced by the interest rate scenario, Other Financial Income and Other Operating Income and Charges, leading to a slight decrease in revenues compared to the previous quarter (-1.0%).

With regard to the presentation of revenues for each of the operating segments identified in accordance with IFRS 8, please refer to the chapter on “Results by Operating Segment” in this Consolidated Report on Operations.

Net Interest Income as at 31 December 2024 amounted to EUR 2,356 mln, an increase compared to 2023 (+2.8%, equal to EUR +63.7 mln). The growth was mainly driven by the higher contribution from relations with central banks, hedging derivatives and the securities portfolio. In particular, in relations with central banks, a net benefit of EUR 143 mln was recognised as at 31 December 2024, compared to the net cost of EUR 70 mln for 2023. This performance reflects, among other things, the change in the net position vis-à-vis the ECB from an average debit balance of EUR 1.5 bn in 2023 to an average credit balance of EUR 4.9 bn in 2024, thanks to the optimisation of the total cost of funding. This positive trend more than offset the higher cost of bond issues – mainly caused by renewed recourse to the institutional market – and the higher borrowing rates recorded in transactions with customers, especially in the first half of 2024.

The Net Interest Income in Q4 2024 was slightly lower than in the previous quarter (-1.3%, or EUR -7.6 mln), with a resilient commercial spread also due to the effective management of the cost of commercial funding.

BANCA MONTE DEI PASCHI DI SIENA

Net fee and commission income, totalling EUR 1,465 mln as at 31 December 2024, recorded a significant increase compared to the same period of the previous year (+10.8%). The positive performance is mainly attributable to management/ brokerage and advisory activities (+19.0%; EUR +113.7 mln) and, to a lesser extent, commercial banking activity (+4.1%; EUR +29.7 mln). In detail, in the first commissions area, the contribution of distribution and portfolio management increased (+30.1%; EUR +109.7 mln) and insurance products (+8.5%; EUR +16.3 mln). In the commercial banking area, com-mission income on guarantees (EUR +28.9 mln) and other net fee and commission income (EUR +12.4 mln) were partly offset by reduced commissions on current accounts (EUR -16.4 mln) in relation to the Bank’s reduction of account maintenance costs applied to customers and the ATM and credit card services (EUR -10.1 mln). The result for the fourth quarter of the 2024 financial year showed an increase over the previous quarter (+4.9%) due to growth in commercial banking (+8.1).