PROJECT OLYMPUS

September 2017
PROJECT OLYMPUS
Unique Opportunity for Selective Growth in Slovenian Banking
STRICLY PRIVATE & CONFIDENTIAL

DISCLAIMER
This confidential presentation (the “Teaser”) is being delivered to a limited number of parties who, it is believed, may be interested in
acquiring an equity interest in LON d.d. (the “Company”). This Teaser is furnished to you on a confidential basis solely for the purpose of
evaluating the transaction described herein.
The Teaser has been prepared by the Company and the Company is solely responsible for its contents. Only those particular
representations and warranties that may be made by the Company in a definitive written agreement, when and if one is executed, and
subject to such limitations and restrictions as may be specified in such agreement, shall have any legal effect.
In addition, this Teaser may include certain statements provided by the Company and the Company with respect to the Company and the
Company’s historical and anticipated performance of the Company’s assets. Estimates of future performance reflect various assumptions
made by the Company that may or may not prove accurate, as well as the exercise of a substantial degree of judgment by management
as to the scope and presentation of such information. No representations or warranties are made as to the accuracy of such statements or
estimates of anticipated performance. Actual results achieved during projection periods may differ substantially from those projected.
By its acceptance hereof, each recipient agrees that neither it nor its agents, representatives, directors or employees will copy, reproduce
or distribute to others this Teaser, in whole or in part, at any time without the prior written consent of the Company. This Teaser shall
remain the property of the Company.
This Teaser does not constitute an offer or invitation for the sale or purchase of the securities, assets or business described herein and shall
not form the basis of any contract.
By accepting this Teaser, each recipient acknowledges that it is aware and will advise its officers, directors, employees, advisors and
representatives who are informed of the matters that are the subject of this Teaser, of the restrictions imposed by applicable securities
laws on the purchase or sale of securities by any person who has received material, non-public information from the Company and on the
communication of such information to any other person.
Nothing contained herein shall be construed as legal, tax, financial or accounting advice.

OVERVIEW OF THE POTENTIAL TRANSACTION
LON D.D. IS DELIGHTED TO INTRODUCE PROJECT OLYMPUS, A UNIQUE INVESTMENT OPPORTUNITY TO SUPPORT LON, A FAST
GROWING PRIVATELY OWNED SLOVENIAN SAVINGS AND LOANS BANK IN REACHING ITS STRATEGIC OBJECTIVES.
INTRODUCTION
Get to know us!
THE INVESTMENT
OPPORTUNITY
THE EXISTING
SHAREHOLDING
STRUCTURE
ROOM FOR NEW
SHAREHOLDERS TO LEAD
FORWARD

INTRODUCTION
LON is in the process of exploring
alternatives in relation to a potential
increase in its shareholders equity. We are
young team, so we are always ready for
change and learning, therefore we are aware
of importance of digital banking solutions.
Our branches are situated all over Slovenia.
Our company advantage is also good
organizational structure that allows quick
decision-making.

INTRODUCTION
LON, with headquarters in Kranj, Slovenia,
is a fast growing independent privately
owned savings and loan bank with 130
employees and a network of locations
stretching across Slovenia.
VIDEO

THE INVESTMENT
OPPORTUNITY
LON is planning a 50 % increase in the number
of its existing outstanding ordinary equity shares
in line with the shareholders resolution on
authorized capital by way of a public offering of
new shares (hereinafter “Potential Transaction”);
and is therefore looking to explore potential
interest from a limited number of pre-qualified
well informed investors of participating in the
subsequent Potential Transaction;
that would be followed by submission of nonbinding
indicative offers, which may be
considered in determining the final terms and
conditions of a Potential Transaction.

THE EXISTING
SHAREHOLDING
STRUCTURE
LON‘s shareholder base is highly diversified
and consists of small and mid sized
enterprises and citizens, whereby the single
largest shareholder is holding less than 10 %
of the existing shares in the Company.

ROOM FOR NEW
SHAREHOLDERS TO
LEAD FORWARD
This existing structure in combination with
the Potential Transaction may create room
for potential new investors that:
would consider acquiring an equity interest
in excess of 10 %
in conjunction with exploring long term
commercial cooperation with the Company
that may create tangible added value for
the Company and its shareholders.

KEY INVESTMENT CONSIDERATIONS
UNMATCHED ASSET QUALITY IN SLOVENIAN BANKING
The banks asset quality is unmatched in the Slovenian banking sector.
This is partly related to a higher proportion of retail exposure and prudent loan underwriting practices.
The relatively low level of non-performing assets allows the Bank to focus on building relations with clients and manage
risks efficiently instead of being entrenched in tedious restructuring processes.
GROWING IN A STAGNATING ENVIRONMENT
The banks asset quality is unmatched in the Slovenian banking sector.
This is partly related to a higher proportion of retail exposure and prudent loan underwriting practices.
The relatively low level of non-performing assets allows the Bank to focus on building relations with clients and manage
risks efficiently instead of being entrenched in tedious restructuring processes.

KEY INVESTMENT CONSIDERATIONS
ROOM FOR NEW SHAREHOLDERS TO LEAD AND WAY FORWARD
In order for the Bank to continue growing continue growing, while also maintaining sufficient regulatory capital, it will require its
shareholders to provide additional equity capital.
The existing shareholder base is consisting of small and mid sized enterprises and citizens with a limited pool of resources.
This leaves room for larger well informed investors that would consider acquiring an equity interest in excess of 10 % to lead the
way forward and support the Bank in achieving its strategic objectives.
UNLOCKING SYNERGIES AND ADDING VALUE
Potential well informed investors with adequate financial strength may, at the discretion of the management, engage in exploring
long term commercial cooperation with the Company that may create tangible added value for the Company and its
shareholders.
MACROECONOMIC ENVIRONMENT PROVIDING TAILWING
Economic trends remain highly supportive when looking at overall headline indicators.
Especially the acceleration of the growth in private consumption in combination with a declining unemployment rate and
improving government fiscal position creates a potential tailwind for the Bank’s activities in the next couple of years.

MARKET POSITION AND ASSET QUALITY
THE BANKS ASSET QUALITY IS UNMATCHED IN THE SLOVENIAN BANKING SECTOR, WHILE THE EXISTING MARKET POSITION
LEAVES ROOM FOR HIGH GROWTH GOING FORWARD.
Poštna banka Slovenije, d.d.
1,8
NKBM, d.d.
9,7
Raiffeisen Banka d.d.
1,8
Gorenjska banka d.d.
4
NLB d.d.
23,8
UniCredit Banka Slovenija d.d.
7
Deželna banka Slovenije d.d.
2,5
Sberbank banka d.d.
5,2
Abanka d.d.
10,5
SID banka, d.d.
8,7
Hypo Alpe-Adria-Bank d.d.
3,7
BKS Bank AG, Bančna podružnica
1,8
SKB banka d.d.
7
Banka Koper d.d.
6,2
Banka Sparkasse d.d.
3
Delavska hranilnica d.d.
Primorska hranilnica Vipava d.d.
0,1
2,5
Market Share (in % of Total Assets)*
LON d.d.
0,7
*Level as 31. 12. 2015 based on annual reports

MARKET POSITION AND ASSET QUALITY
THE BANKS ASSET QUALITY IS UNMATCHED IN THE SLOVENIAN BANKING SECTOR, WHILE THE EXISTING MARKET POSITION
LEAVES ROOM FOR HIGH GROWTH GOING FORWARD.
Poštna banka Slovenije, d.d.
43
NKBM, d.d.
33,7
Raiffeisen Banka d.d.
32,1
Gorenjska banka d.d.
NLB d.d.
UniCredit Banka Slovenija d.d.
Deželna banka Slovenije d.d.
Sberbank banka d.d.
Abanka d.d.
SID banka, d.d.
Hypo Alpe-Adria-Bank d.d.
BKS Bank AG, Bančna podružnica
SKB banka d.d.
Banka Koper d.d.
17,3
16,8
16,4
16,4
16,3
15,9
14,8
13,9
12,5
11,6
10,7
Banka Sparkasse d.d.
8,7
Delavska hranilnica d.d.
Primorska hranilnica Vipava d.d.
2,6
8,1
Share of Non-Performing Assets (in %)*
LON d.d.
1,9
*Level as 31. 12. 2015 based on annual reports

SUMMARY OF THE FINANCIAL POSITION
LOANS AND ASSETS HAVE BEEN GROWING AT HIGH SINGLE DIGIT GROWTH RATES IN A PERIOD WHERE THE BANKING SYSTEM
ON AGGREGATE IS STRUGGLING TO FIND DEMAND.
Lon Asset Base Breakdown (MIn €)
Slovenian Banks Asset Base (Bin €)
300
50
250
200
150
100
50
5
4
103 122
95 90
7
109
116
11
11 11
110 103
117
135 142 143
45
40
35
30
25
20
15
10
46
40 39
37 37 37
0
2012 2013 2014 2015 2016 apr.17
Loans Given Financial Assets & Cash Equivalents Other
5
0
2012 2013 2014 2015 2016 apr.17
Source: Company
(1) Financial Assets Held to Maturity & Available for Sale, Cash and Amounts Due from Banks Source: Bank of Slovenia

SUMMARY OF THE OPERATING PERFORMANCE
GROWTH IN NET INTEREST INCOME, STABLE FEE & COMMISSION INCOME
NET PROFIT TEMPORARILY UNDER COST PRESSURE, HOWEVER SET TO GRADUALLY RECOVER
LON Asset Base Breakdown (MIn €)
Slovenian Banks Income and Profit (MIn €)
9
2000
8
1500
7
6
5
4
3
2
2,5 2,1
4 4,1
2,1
5,1
2,3 2,2
5,7 5,6
0,7
1000
500
0
-500
-1000
NET PROFIT
2012 2013 2014 2015 2016 2017 x
1
0
2012 2013 2014 2015 2016 2017
1,9
NET PROFIT
-1500
-2000
Net Interest Income
Net Fee & Commision Income
Net Interest Income
Net Fee & Commission Income
Source: Company
Source: Bank of Slovenia

EXTREMELY SUPPORTIVE MACROECONOMIC
ENVIRONMENT
THE ECONOMIC ENVIRONMENT SUPPORTS GROWTH OF CONSUMPTION AND SMES FOR SLOVENIA
GDP Growth (YoY %)
4
3
2
1
0
-1
-2
3,1
2,3 2,5
3,3 3,1
2013 2014 2015 2016 2017 2018
-1,1
Government Debt (% of GDP)
85
80
75
70
65
60
71
80,9
83,1
79,7
77,8
75,5
2013 2014 2015 2016 2017 2018
Private Consumption Growth (YoY %)
4
3,2
2,8
3
2
2
0,5
0
2013 2014 2015 2016 2017 2018
-2
-4
-4
-6
Budget Balance ( % of GDP )
0
2013 2014 2015 2016 2017 2018
-0,5
-1
-1,5
-2
-1,7
-1,8
-1,9
-2
-2,5
-2,3
-3
-2,7
Unemployment Rate ( %)
12
10
8
6
4
2
0
Export Growth (YoY %)
7
6
5
4
3
2
1
0
10,1
3,1
9,7
9
5,7 5,6 5,9 5,8
5,4
2013 2014 2015 2016 2017 2018
8
7,2
6,3
2013 2014 2015 2016 2017 2018

NEXT STEPS AND CONTACT DETAILS
PROJECT OLYMPUS NEXT STEPS
As part of Project Prometheus, interested parties will first be required to submit an Expression of Interest (“EoI”) in
line with the Invitation Letter in September 2017.
Following the EoI phase pre-qualified parties will be required to execute a Non-disclosure Agreement (“NDA”) and
then will be provided with a Process Letter outlining the details on proposed further steps in relation to the
Potential Transaction and granted access to management presentations and confidential information regarding
the Bank in order to ascertain the possibility of submitting an Indicative Offer in Oktober 2017 (“Indicative Offer
Phase”).
Following the Indicative Offer Phase and taking into considerations Indicative Offers received the Company
intends to determine the final terms and conditions of a Potential Transaction.
Please refer to the below contact persons for any questions regarding the Potential Transaction.
Jaka Vadnjal, Ph.D.
PRESIDENT OF THE MANAGEMENT BOARD
+386 4 280 07 37
jaka.vadnjal@lon.si
www.lon.si
Bojan Mandič
MEMBER OF THE MANAGEMENT BOARD
+386 4 280 07 36
bojan.mandic@lon.si
www.lon.si