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Euroclear Full Year 2019

Results Presentation

February 2020

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Today’s Agenda

1.Chairman’s overview Marc Antoine Autheman

2.Performance Highlights Lieve Mostrey

3.Financial Performance Update Bernard Frenay

4.Business Highlights Frederic Hannequart

5.Outlook Lieve Mostrey

6.Questions and Answers

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Disclaimer

The information, statements and opinions expressed in this presentation (the “Content”) do not constitute and shall not

be deemed to constitute: (i) any offer, invitation or inducement to sell a security or engage in investment, financial or

other similar activity; or (ii) a solicitation of an offer to buy any security; or (iii) any recommendation or advice in relation

to any investment, financial or other decision. Persons considering making any investment or financial decision should

contact their qualified financial adviser. The Content may include forward looking statements, in particular, in relation to

future events, growth, future financial performance, plans, strategies, expectations, aims, prospects, competitive

environment, regulation and supply and demand. Such statements contain inherent risks and uncertainties and actual

outcomes may differ materially from those expressed or implied by forward looking statements.

To the maximum extent permitted by law, no warranty or representation including, but not limited to, accuracy or

completeness (express or implied) is made in relation to the Content, including, but not limited to, any projections or

statements about the prospects of Euroclear. Euroclear makes no commitment to update Content and expressly

disclaims, to the extent lawful, liability for any errors or omissions in it. The Content is not directed at, or intended for

distribution to, or use by any person or entity where such distribution or use is restricted by law or regulation. Persons into

whose possession the Content comes should inform themselves about and observe any such restrictions. Past

performance, historic financial information and/or historic distributions should not be taken as an indication of current or

future performance, results or distributions.

The 2019 consolidated financial information included in this presentation is unaudited and based on Euroclear Holding

SA/NV consolidated figures as of 31 December 2019. The audited consolidated financial statements of Euroclear

Holding SA/NV for the year ended 31 December 2019 will be submitted for approval to the annual general meeting of

shareholders of Euroclear Holding in May 2020 and will be filed in accordance with applicable requirements under

Belgian law.

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Excellent 2019 performance across all

business lines

First (I)CSD group to obtain CSDR licenses

Growth in shareholder returns with dividend doubled in 2 years

Shareholder liquidity initiatives ongoing

Overview from the Chairman

Performance Highlights

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Excellent 2019 Performance - Highlights

Record Financial

Performance

EPS: +34%

Delivering Customer-

Centric Strategy

DPS: +50%

Improved Operating Income, Efficiency and Profitability

Balance sheet strengthened

Generating Shareholder Value and Returns

Strengthening Core Network as 1st (I)CSD Group with CSDR Licences

Growing Network Collateral Management and International Expansion

Reshaping Network Exploring Innovation and Data Opportunities

Business

Income

Operating

Margin:

+3.9 %pts

Operating

leverage:5%

7

1,1501,229

1,296

14.0

214.0

414.0

614.0

814.0

1,014.0

1,214.0

1,414.0

2017 2018 2019

Record Business Drivers underpin Strong 2019 Performance

Assets under Custody

€ Trillion – Yearly Average

Netted Transactions

Number of transactions (million)

Collateral Outstanding

€ Billion – Yearly Average

• Customer expansion led to assets

under custody (AuC) of over €30 trillion.

• Year-end AuC reached €31.4 trillion.

• Record level of transactions settled

in 2019 equivalent to €837 trillion:

approximately 10 x Global GDP.

• Regulatory / industry requirements

driving growth of collateral

outstanding to record €1.3 trillion.

215 230 239

14

64

114

164

214

264

2017 2018 2019

28.4 28.8 30.1

2017 2018 2019Debt Equities Turnover in € trillion

733 793 837

• Customer expansion led to assets

under custody (AuC) of over €30 trillion.

• Year-end AuC reached €31.4 trillion.

• Record level of transactions settled

in 2019 equivalent to €837 trillion:

approximately 10 x Global GDP.

Financial Performance Update

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Record Financial Performance in 2019

€ 1145m Business Incomevs FY 2018

€820m Operating Expensesvs FY 2018

€137 Earnings Per Sharevs FY 2018+6% -0.7% +34%

2018

(€ m)

Operating Income 1335 1435 100 8%

Business income 1079 1145 66 6.1%

Interests,banking & other inc. 256 290 34 13%

Operating Expenses -814 -820 -6 -0.7%

Share of results -7 1 8

Operating Profit before impairment 514 616 102 20%

Impairment -29 -2 27

Pre tax profit 485 614 129 27%

Tax -163 -183 -21 -13%

Net profit 322 431 109 34%

* adjusted for liquidity initiativ e and EIS costs 345 82

EPS 102.3 136.9 34%

Business income operating margin 24.5% 28.4%

EBITDA margin (EBITDA/op.inc) 44.6% 49.4%

FY 2019

2018

vs

10

Business Income Growth across Business Lines

2019 Business Income

Business Lines

6%

12%

2%

1,039 1,079

1,145

Business Lines Track Record (€ m)

6%

10%

5%

6% growth in 2019

Market Drivers

Fixed

Income

nominal

value,

48%Equities

value,

23%

Transaction

volumes, 29%

795 814 859

113 126139

131139

147

0

200

400

600

800

1,000

1,200

1,400

2017 2018 2019

Strenghten (Europe/Funds) Grow (Global Reach) Grow (Collateral Highway)

Strengthen

(Europe /

Funds), 75%

Grow

(Collateral

Highway), 13%

Grow (Global

Reach), 12%

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• Interest rate rises in USD underpinned strong cyclical growth inBanking Income

• Interest rates in Eurozone remain negative

• Interest income up despite additional charges linked to liquidity linesrequired in light of CSDR compliance

• Rates: Interest income cyclical in nature and highly correlated with interest rates

• Volumes: Balances slightly above 2018 level

133 163

184

256 290

2015 2016 2017 2018 2019

Interest Rate Evolution

USD Rate Rises Led to Increase in Net Interest Income

Interest, Banking & Other Income (€ m)

+13%

25.3 18.1 17.1 20.1

Average Deposits

(€ bn)

Deposits Currency Split

EUR, 26%

USD, 49%

GBP, 7%

Others,

18%

20.6

0.51%

1.10%

1.90%

2.28%

-0.38% -0.40% -0.40% -0.43%

0.40% 0.29%0.60%

0.75%

2016 2017 2018 2019

Average central bank's interest rate

USD (FED) EUR (ECB) GBP (BOE)

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• Operating expenses of €820m, up 0.7%, while sustaining

investment levels

• Investments ongoing to modernise technology

capabilities, along with product enhancements,

regulatory-driven and cyber security initiatives

• Technology modernisation programme includes:

Selectively upgrading platforms & infrastructure

Enabling digitalisation of products & data solutions

Enhancing IT operating model for efficiency & agility

• Cost discipline remains a strong focus, demonstrated

by the set-up of an operational excellence team to

coordinate delivery of cost savings.

Operating expenses

Strong Cost Management while Sustaining Investment Levels

-15 -14 -11

649 662 663

175 166 168

809 814 820

2017 2018 2019

(€m)Expenses

Net Capitalisation Running Total Investments

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Business Income Operating Margin Increased to 28.4%,

Ahead of Strategic Plan

• Business income operating margin of

28.4% increased by 4 percentage points

• EBITDA of €709m, up 19%, in line with the

operating profit increase recorded in the

period, leading to 49% EBITDA margin

Business Income Operating Margin1, EBITDA & EBITDA margin2

1. Business Income Operating Margin is calculated as the difference between Business Income and the Operating Expenses, divided by the Business Income

2. EBITDA margin is calculated as the EBITDA divided by the Operating Income

22%25%

28.4%

37%

45%

49%453

596

709

1

101

201

301

401

501

601

701

10%

20%

30%

40%

50%

60%

70%

FY 17 FY 18 FY 19

BI operating margin EBITDA margin EBITDA (in € million)

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• Debt Securities Issued & Funds borrowed reached€6,107 million driven by additional short-term paper

issued by Euroclear Bank SA/NV.

• Financial Assets exceeded €10bn at group level

mainly driven by reinvestments by the Bank of the

2019 debt proceeds and client balances in securities.

• Shareholders' equity up to €4,230m on accumulated

profit, before 2019 expected dividend payment.

• Strong and stable capital ratios reflecting Euroclearlow risk profile above required levels.

Strong Balance Sheet with Good Liquidity

Group capital ratios & Risk Weighted Assets (RWAs) *

Balance Sheet

(€m)

2019 2018

Cash and balances with central banks 1,883 4,536

Loans and advances 13,735 14,540

Financial assets 10,311 7,434

Goodwill and intangible assets 1,002 992

Other assets 638 632

Total assets / Liabilities 27,569 28,134

Deposits from central banks 826 540

Deposits from banks and customers 15,589 17,944

Debt securit ies issued and funds borrowed 6,107 4,956

Shareholders’ equity 4,230 3,839

Other liabilit ies 817 855

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Delivering Increasing Returns for Shareholders

€/share

Earnings per share

1. Return on Equity is calculated as the net profit of the year divided by the average shareholder equity pre dividend distributions, as reported in the year-end financial statements

%

Return on equity1

8.7% 8.7%

7.5%

8.6%

10.7%

2015 2016 2017 2018 2019

87.0 83.7 84.6

102.3

136.9

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

2015 2016 2017 2018 2019

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Record Dividend per Share and NAV per Share

1. Dividend guidance for 2019

2. Net Assets Value per share is calculated as the reported equity at year end 2019 divided by the number of shares

€/share

Dividend per share1 NAV per share2

€/share

36.3 37.0 39.0

55.0

82.4

40% 40%

52% 54%60%

20%

30%

40%

50%

60%

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

2015 2016 2017 2018 2019Dividend per share Div pay-out (%)

1,077 1,1031,166

1,2201,344

14

214

414

614

814

1,014

1,214

1,414

2015 2016 2017 2018 2019

Business Highlights

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Venue neutral and

open architecture

Regulated as

systemically

important market

infrastructureGlobal collateral and

liquidity optimisationRisk reduction

Cost & process

efficiency

Investment

banks

Custodians

Central banks

Exchanges

Central

Counterparty

Clearing

Issuers

Central Securities

Depositories

Open model, as

liquidity and collateral

hub at the centre

of the global financial

market ecosystem

Unique Position at the Centre of a Global Client Network

Business Strategy aims to Strengthen, Grow and Reshape the Euroclear Network

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• Record business drivers and strong income growth

• Clients’ needs shaped by regulatory changes

• 1st ICSD group to be granted CSDR licences

• Well prepared for Brexit

• New issuer solutions

• Extending access to Central Bank Money by connecting

Euroclear Bank to T2S

Strengthening our Network in Europe

Business Income

Revenue Mix / Outlook

• C. 75% of Business Income

• Expect Growth in line with European GDP levels

Eurobonds and Domestic European Securities

• Extending Euroclear’s position as the place for funds

• Notable client wins across various platforms

• International ETF structure continues to grow

FundsPlace

807795 795

814

859

2015 2016 2017 2018 2019

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• Record business drivers and 6% income growth, despite

challenging market conditions

• Successfully onboarding clients as part of Wave 4 of regulatory

requirements for OTC derivatives

• Took 100% share in GlobalCollateral Ltd to enhance customer

delivery model for global investors

Growing our Network Globally

Business Income (Growth)

Revenue Mix / Outlook

• C. 25% of Business Income

• Expect High Single Digit Growth Through-the-Cycle

Collateral Highway

• Strong pipeline of markets attracted to ‘Euroclearability’

• Memorandum of Understandings signed with China, Saudi

Arabia and Egypt to develop cross-border links

• Exploring opportunities to support development of ESG

finance sector

Global Reach

191204

244264

286

2015 2016 2017 2018 2019

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• EasyWay web interface client growth of >300% in 2019 to 870

active clients

• Taskize community grown to +200 active clients in 50 countries

• Reference data products gaining client traction and

generating revenues

• Preparatory work completed for first liquidity data solutions,

with commercial phase beginning in 2020

• Developing blockchain solution to support to new issuer needs

under incoming SRDII regulations

• Collaborating with industry initiatives to explore technology

such as Blockchain

• Pilot project with EIB, Santander and EY

• Investment in Liquidshare

Reshaping our Network

Data and Innovation

Data insights

Technology

Connection

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• Credit rating is important for our clients

• Consistently strong and stable credit ratings

AA / AA+ Rating

Fitch

AA+

S&P

AA

Financial Market Infrastructure with Low Risk Profile

Strong Capital Position (2019)

Low Group Leverage

Euroclear

Combination of high credit rating, low risk profile and solid capital ratio are critical to resilient and sustainable performance

Net Debt / EBITDA

• Strong ICAAP framework set at 99.98% confidence level

• Capital above ICAAP threshold providing additional buffer

1

Debt issued with the sole

purpose to meet recovery

regulatory requirement

Improved due to higher

EBITDA and improving cash

position

1.5x1.2x

2018

2019

Systemically important role

€ 837tn

€-equivalent

transactions

processed

€ 31tn

assets held in

custody

Connecting

2,000

financial

institutions

Connected to

50+

financial markets

• Sustained investment in technology and cyber resilence to

mitigate operational risks

• Debt issuances strengthened Euroclear Bank’s liquidity profile

• Constant focus on ethics and regulatatory compliance

Outlook

24(1) Excludes Interest and Banking income.

• Margin expansion driven by cost base

stabilisation

• Cost base expected to grow at inflation

• Efficiency initiatives and investments

expected to deliver margin expansion

• Stable level of investment at 20% of

total cost base going forward

Investments in regulatory

infrastructure & cyber

security elevated cost base

Costs plateau in 2018-2019,

leading to Business Operating

Income Margin Improvement

Maintain Slower

Expense Growth

Business Income

Margin expansion

Maintain Business

Income(1) Growth

Trajectory +4%

Investment requirements led to

Margin Compression

2013 2017 2019 2023

Business

Income

Costs

Delivery of Strategic Plan Evidenced in 2018 & 2019

Expect to Further Improve

Operating Margin

Low to

Mid Thirties

26%

28%

22%Business

Income

Margin

Consistent Business Income

Growth Trajectory

2019 confirming our

long term performance

objectives

Robust Strategic Plan to Deliver Growth and Efficiency

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Expect to Continue to Deliver Attractive Growth, Whilst

Retaining AA / AA+ Rating

1. Excludes Interest and Banking income.

Business income

Interest, Banking

and Other Income

Business Income

Operating margin1

2019 (2018) 5-Yr growth

€1,145m (€1,079m)

€290m (€256m)

28.4% (25%)

Maintain Historic

Growth Trajectory

Driven by Balances

and Interest Rates

Low to Mid Thirties

Rating AA / AA+Maintain AA/

AA+ Rating

Operating

leverage

2% average

through-the-cycle5% (3%)

Comments on 2019

Above Secular

Trend

Good progress

ahead of strategic

plan

Ahead of target for

two years in a row

Driven by higher first

half USD rates

Strong reduction

in Net debt /

EBITDA ratio

Questions & Answers

Appendix

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Euroclear Leadership Team

Bernard Frenay

Chief Financial Officer

Frederic Hannequart

Chief Business Officer

Lieve Mostrey

Chief Executive Officer

Yves Dupuy

Chief Information Officer

Peter Sneyers

Chief Risk Officer

Marc Antoine Autheman

Chairman

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Reported and Adjusted EPS ReconciliationEBITDA retreatments

* Net financial charges recorded at Euroclear Holding level

(€ m) FY 2017 FY 2018 FY 2019

Operating profit before Impairment 408 514 616 20%

Depreciat ion, amort isat ion & other provisions 38 64 70 10%

Net financial charges** 7 19 24 27%

EBITDA 453 596 709 19%

0 0 0EBITDA margin (EBITDA/op.inc) 37% 45% 49%

vs 2018

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Euroclear Investments – Summary Income Statement (in IFRS)

2019 2018 Y-o-Y

Net Operating income 436 78 459%

Net Interest Income 4 -2 -279%

Other Income 1 0 150%

Gains on non trading financial assets 215 -56 -484%

Dividend Income 216 136 59%

Operating expenses -1 -1 0%

Share of results 0 0 0%

Operating profit before Impairment* 435 77 464%

Provisions 0 0 0%

Tax -55 15 467%

Net Profit 380 92 312%

(€ m)

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Euroclear Investments – Summary Balance Sheet (in IFRS)

€ million

end of year balance2019 2018 %

Loans & Advances 129.0 270.7 -52%

Financial assets 246.6 173.8 42%

Non-trading financial assets 1,103.9 781.0 41%

Current & Deferred income tax assets 0.0 6.9 -100%

Other Assets & Accruals 0.4 0.3 33%

Property Plant & Equipment 0.2 0.0 n.a.

Participations in group companies 637.2 637.2 0%

Total Assets 2,117.3 1,869.8 13%

Long Term Debt 1301.8 1,300.8 0%

Intercompany Borrowings 0.0 0.0 n.a.

Financial Liabilities held for trading 0.0 0.0 n.a.

Income & deferred tax liabilities 49.0 0.0 n.a.

Other liabilities & Accruals 0.2 0.3 -33%

Shareholders' Equity 766.3 568.7 35%

Total Liabilities 2,117.3 1,869.8 13%

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Euroclear Bank - Summary Income Statement (in BEGAAP)

2019 2018 Y-o-Y

Net Operating income 1,025 944 9%

Operating expenses -541 -514 -5%

Share of results 0 0 n.a.

Operating profit before Impairment* 484 431 12%

Provisions 0 0 n.a.

Impairment 0 -4 -100%

Tax -142 -127 12%

Net Profit 342 299 14%

(€ m)

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Euroclear Bank – Summary Balance Sheet (in BEGAAP)

€ million

end of year balance2019 2018 %

Loans and advances to banks and customers 15,210 18,638 -18%

Financial Assets 8,932 6,521 37%

Goodwill and (in)tangible assets 6 5 20%

Other assets/accrued income 176 242 -27%

Total Assets 24,325 25,406 -4%

Deposits by banks and customers accounts 16,452 18,491 -11%

Debt instruments issued 5,309 4,258 25%

Other liabilities/provisions 376 560 -33%

Subordinated liabilities 306 202 51%

Shareholders' equity 1,882 1,894 -1%

Total Liabilities 24,325 25,406 -4%

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Disclaimer

© 2020 Euroclear SA/NV, 1 Boulevard du Roi Albert II, 1210 Brussels, Belgium – Tel: +32 (0)2 326 1211 –RPM Brussels number 0423 747 369. Euroclear is the marketing name for the Euroclear System, EuroclearHolding SA/NV, Euroclear SA/NV and their affiliates. All rights reserved. The information and materialscontained in this document are protected by intellectual property or other proprietary rights.

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