Annual report
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Coop Pank annual report 2018 1 Annual Report 2025
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 2 General information Business name Public Limited Company (AS) Coop Pank Registered 15.03.1992 in Tallinn Legal address Maakri 30, Tallinn 15014, Republic of Estonia Commercial register number 10237832 (Commercial Register of the Republic of Estonia) Date of first entry 19.08.1997 Phone + 372 669 0900 SWIFT/BIC EKRDEE22 E-mail info@cooppank.ee Website www.cooppank.ee Auditor AS PricewaterhouseCoopers Commercial register number of the auditor 10142876 (Commercial Register of the Republic of Estonia) Auditor’s address Tatari 1, Tallinn 10116 Balance sheet date of the financial statements 31.12.2025 Beginning and end of the financial year 01.01.2025 - 31.12.2025 Reporting currency euro (EUR), in thousands Members of the Supervisory Board: Rainer Rohtla (Chairman), Viljar Arakas, Jaan Marjundi, Roman Provotorov, Raul Parusk, Silver Kuus Members of the Management Board: Arko Kurtmann (Chairman), Paavo Truu, Alvar Pihlapuu, Heikko Mäe , Karel Parve, Lehar Kütt
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 3 Table of contents General information ......................................................................................................................................................... 2 Table of contents ............................................................................................................................................................... 3 Management report .......................................................................................................................................................... 5 Strategy ........................................................................................................................................................................... 5 Targets ............................................................................................................................................................................ 7 Operating environment ................................................................................................................................................ 8 Managing Director´s Statement ............................................................................................................................... 10 Financial results .......................................................................................................................................................... 16 Capitalisation and risk positions ............................................................................................................................... 17 Group management system ...................................................................................................................................... 19 Shares ........................................................................................................................................................................... 23 Dividend policy ............................................................................................................................................................ 24 Corporate Governance Report .................................................................................................................................. 25 Sustainability Report ...................................................................................................................................................... 34 Remuneration report ..................................................................................................................................................... 42 Consolidated Financial Statements .............................................................................................................................. 45 Consolidated Statement of Profit or Loss and Other Comprehensive Income .................................................. 45 Consolidated Statement of Financial Position ........................................................................................................ 46 Consolidated Statement of Cash Flows ................................................................................................................... 47 Consolidated Statement of Changes in Equity ........................................................................................................ 48 Notes to Consolidated Financial Statements .............................................................................................................. 49 Note 1 Material accounting policy information ...................................................................................................... 49 Note 2 Risk management .......................................................................................................................................... 61 Capital management .............................................................................................................................................. 63 Credit risk management ........................................................................................................................................ 64 Liquidity risk management .................................................................................................................................... 91 Market risk management ....................................................................................................................................... 94 Operational risk management .............................................................................................................................. 98 Environmental, social and governance risk management ................................................................................. 99 Fair value of assets and liabilities ....................................................................................................................... 100 Note 3 Subsidiaries and goodwill ........................................................................................................................... 103 Note 4 Operating segments .................................................................................................................................... 104 Note 5 Net interest income ..................................................................................................................................... 107 Note 6 Fee and commission income ...................................................................................................................... 107 Note 7 Payroll expenses .......................................................................................................................................... 108 Note 8 Operating expenses ..................................................................................................................................... 108 Note 9 Cash, cash balances at central banks and other deposits ...................................................................... 108 Note 10 Financial investments ................................................................................................................................ 109 Note 11 Loans and advances to customers .......................................................................................................... 109 Note 12 Other financial assets and other assets .................................................................................................. 111 Note 13 Tangible and intangible assets ................................................................................................................. 111 Note 14 Lease liabilities ........................................................................................................................................... 112 Note 15 Customer deposits ..................................................................................................................................... 112 Note 16 Loans received ............................................................................................................................................ 112 Note 17 Issued Debt Securities ............................................................................................................................... 113 Note 18 Other financial liabilities and other liabilities ......................................................................................... 113 Note 19 Subordinated debt ..................................................................................................................................... 114 Note 20 Equity ........................................................................................................................................................... 115 Note 21 Financial guarantees and loan commitments ........................................................................................ 116
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 4 Note 22 Litigations .................................................................................................................................................... 117 Note 23 Related parties ........................................................................................................................................... 117 Note 24 Basic earnings and diluted earnings per share ...................................................................................... 119 Note 25 Income tax expense ................................................................................................................................... 119 Note 26 Events after balance sheet date ............................................................................................................... 120 Note 27 Separate financial statements of parent company ................................................................................ 121 Statement of Profit or Loss and Other Comprehensive income of parent company .................................. 121 Statement of Financial Position of parent company ........................................................................................ 122 Statement of Cash Flows of parent company ................................................................................................... 123 Statement of Changes in Equity of parent company ........................................................................................ 124 Management Board declaration................................................................................................................................. 125 Independent auditor’s report ..................................................................................................................................... 126 Proposal for profit allocation ...................................................................................................................................... 134 Revenues by EMTA classification (the Estonian classification of economic activities) ......................................... 135
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 5 Management report Coop Pank was founded in 2017, and since 2019, Coop Pank’s shares have been listed on the Nasdaq Tallinn Stock Exchange. The following companies were part of Coop Pank AS group (also used as "consolidation group", "the bank”) as at 31.12.2025: Coop Pank AS, Coop Liising AS, Coop Kindlustusmaakler AS and SIA Prana Property. The first four companies are registered in the Commercial Register of Republic of Estonia and SIA Prana Property in the Commercial Register of the Republic of Latvia. STRUCTURE OF THE GROUP Strategy The bank's way of operating for achieving its strategic objectives is as follows: Estonian bank. Coop Pank is predominantly owned by domestic investors. The bank's customers are mostly residents of Estonia. All our decisions are made in Estonia. Our employees, the Management Board and the Supervisory Board sit at one table, every week if they must. We feel there is public support for domestic capital- based banks. Through its activities, the bank wishes to contribute to the development of Estonian people and companies and thereby support the development of the Estonian economy. In fulfilling this miss ion, we cooperate proactively with Estonian entrepreneurs who need financial support to implement their business plans in both rural and urban areas. By supporting the development of companies outside the big cities, we contribute to the regional development of Estonia and create opportunities for people to live where they want to in Estonia. Everyday banking, financing services and saving products. Coop Pank sees its strengths and the resulting growth opportunities primarily in the provision of everyday banking (account, payments, bank card, cash, deposits), financing services (mortgage loan, consumer loan, credit card, business loan, lease financing) and savings products (short term saving, medium term saving into deposits, long term saving in third-party pension funds). In addition, we intermediate the most common property insurance products (motor third party liability insurance, comprehensive in surance, home insurance, travel insurance, purchase insurance) through our insurance broker. Coop Pank has decided to launch investment services in coming years ; preparations have begun, but the exact format and scope are yet to be defined. holding 100% COOP KINDLUSTUSMAAKLER AS insurance brokerage holding 100% COOP KINDLUSTUSMAAKLER AS insurance brokerage holding 100% COOP LIISING AS leasing holding 100% SIA PRANA PROPERTY real estate management PARENT COMPANY COOP PANK AS banking
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 6 We're fast . Our way of operating is fast always and everywhere - customer can open an account through electronic channels in about 3 minutes, instant payments are made in seconds, we make a decision on a private customer's small loan or credit card in about 5 minutes and we make a mortgage loan decision or car finance lease receivable decision within one working day. Digital sales- and service channels and banking with a human face. At a time when the prevailing trend is digitalisation and service on electronic channels, Coop Pank is following the same path, but also differs by offering customers human contact – the bank's customer service advisors are available to assist clients at 1 6 branches across Estonia. A bank that suits your life/business . Not the other way around. Coop Pank has an ambition to grow and therefore we strive on behalf of every customer. Our risk appetite is moderately and deliberately above the market average. Having a growth strategy and we see as our strength the will and ability to delve into the wishes of our customers, to approach them personally and to find a solution that suits the customer's wishes. We price everyday banking services on a package basis, allowing for the use of all banking services the customer needs on a daily basis for a fixed monthly fee. We pay interest rates on customer term deposits as well as on demand deposits. Integration of banking and retail. Thanks to the strategic partnership with Coop Eesti Keskühistu and its 18 member cooperatives, in addition to the usual sales and service channels (offices, internet banking, mobile banking), we can also offer financial services in 320 stores of Coop Eesti Keskühistu member associations all over Estonia. This is expressed through the Coop Sula service, i.e. the possibility to make a cash withdrawal from a bank account or a deposit to a bank account at cash registers of Coop stores. The customer also receives the cheapest prices in Coop Estonia stores w hen paying for purchases with a Coop Pank card . A customer of Coop Pank’s “Kasulik” package also earns a 1% cashback on all purchases made in Coop stores when paying with a Coop Pank debit card, which is transferred to their bank account once a month. Everyday banking accounts, transfers, bank cards, cash, deposits, travel insurance Financing PRIVATE CUSTOMERS mortgage loan, customer loan, credit card, leasing, insurance Savings solutions Cash Drawer, term deposits, offering options to join pension funds SERVICES PROVIDED BY COOP PANK Everyday banking accounts, transfers, bank cards, cash, deposits, bank link CORPORATES Financing loan, overdraft, leasing, factoring, bank guarantee, insurance
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 7 Targets The mission of Coop Pank is to carry life forward in every corner of Estonia. For this, we give impetus to Estonian companies and help people realise their dreams both in the countryside and in the city. We believe that if Estonian entrepreneurs do well, t he Estonian people and Estonia as a whole will do well too, and we want to contribute to that. In recent years, domestic banks have significantly increased their market share, and we see this trend continuing in the future. Coop Pank also has a fast-growing ambition and a willingness to respond quickly and flexibly to customer needs. Since the beginning of operations (2017), we have increased the bank's business volume (number of clients, loan portfolio) 7–10 times. Over the next five years (by the end of 2030), our strategic goal is to increase the Bank’s loan market share in Estonia at least to 10%. The Bank aims to grow annually at a pace 2 –3 times faster than the market average, supporting the Bank’s ambitious growth strategy. The Bank’s objective is to double its profit over the next five years and reach a net profit of at least 60 million euros by 2030. This goal supports the Bank’s ability to deliver stable and attractive returns to shareholders. In connection with the growth of business volumes, the Bank sets the objective of continuing to operate with high efficiency (cost to income ratio not exceeding 45%) and offering higher return on equity to shareholders (ROE of at least 15%).
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 8 Operating environment In 2025, the keywords for the economic environment were very modest economic growth in developed countries, receding inflation, declining interest rates, and geopolitical tensions in various regions of the world, including the ongoing war in Ukraine and the military conflict between Israel and Hamas. International economy and geopolitics were dominated by the actions of the President of the United States, including the imposition of trade tariffs at much higher level than seen in decades on various countrie s and product groups, bringing U.S. geopolitical ambitions to a new level (including in Latin America, in the Middle East, and even Greenland, which belongs to Denmark), as well as direct military intervention in certain regions. According to the International Monetary Fund (IMF)1, the global economy grew by 3.2% in 2025, with developed countries’ economic growth at only 1.6%. For 2026, global economic growth is forecast at 3.1%, but developed countries are expected to grow by just 1.6%. Throughout 2025, the turbulence created by the U.S. government in international trade and the resulting uncertainty had a significant impact on the global economy. Compared to 2024, inflation decreased significantly, allowing central banks to continue lowering interest rates, which led to a continue d decline in all major base rates until the summer of 2025. From summer 2025 until the end of the year, the interest rate environment remained stable, and markets do not expect significant rate cuts or increases from central banks in the near future. Energy prices were in decline in 2025. For example, the price of Brent crude oil fell from around 70 –80 dollars to 60 dollars per barrel over the year. The price of Dutch TTF gas futures, a key indicator for the European gas market, which briefly exceeded 300 euros in 2022, has since fallen sharply and continued to decline in 2025 from 40–45 euros to about 25–30 euros by year-end. 2025 was a very successful year for global stock markets, with major indices rising for the third consecutive year. Key U.S. stock indices saw strong growth: Dow Jones (+13%), S&P 500 (+14%), and Nasdaq Composite (+20%). The German DAX index (+20%) and Jap an’s Nikkei index (+26%) also grew, despite fundamental problems in these countries’ economies and global competitiveness. The full-scale war between Russia and Ukraine, which began in February 2022, showed no signs of abating by the end of 2025, despite world leaders’ efforts to initiate peace talks. Although the course and intensity of the war have not changed, its direct im pact on the economic environment is diminishing, as companies have adapted to the new situation shaped by extensive economic sanctions against Russian and Belarusian companies and disrupted supply chains to Russia, Belarus, and Ukraine. Tensions in the Middle East had not significantly eased by the end of 2025. Although a ceasefire between Israel and Hamas has been in effect since October 10, 2025, real peace in the region has not been achieved. The situation remains tense in other crisis areas in Middle East such as Iran, Yemen, etc. The euro area’s economic environment was characterized by receding inflation and falling interest rates, but also serious problems with the competitiveness of European companies and strained budgets of European countries. Euro area inflation fell steadily to about 2.0% in 2025 2. For 2026, the European Central Bank (ECB) forecasts3 inflation at 1.9%, which aligns with the ECB’s long -term target (2.0%). Since June 2024, the ECB has lowered the deposit facility rate eight times from 4.0% to 2.0%. The last rate cut took place in June 2025. This has also caused other money market instrument rates to fall. For example, the 6-month Euribor, which is linked to most loans of Estonian companies and mortgage loans to individuals, reached a short -term record of 4.1% in October 2023, but fell to 2.1% by the end of 2025. Looking at long -term money market quotations, it can be 1 https://www.imf.org/en/publications/weo/issues/2025/10/14/world-economic-outlook-october-2025 2 https://www.ecb.europa.eu/stats/macroeconomic_and_sectoral/hicp/more/html/data.en.html 3 https://www.ecb.europa.eu/press/projections/html/index.en.html
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 9 said that markets do not expect further rate cuts but rather forecast base rates to remain at around 2.0% or slightly above. According to the ECB4, the average unemployment rate in the euro area was 6.3% in 2025, which is still a very moderate level, and overall, the labor market is not the biggest concern in Europe today. ECB forecasts indicate that the unemployment rate in the euro area will not i ncrease in the coming years, remaining in the range of 5.9–6.1%. Estonia’s real GDP growth in 2025 was 0.7%, according to the Bank of Estonia5. Thus, the Estonian economy has emerged from several years of decline, but growth remains very modest. The unemployment rate, which rose moderately during the years of economic downturn, remained stable at 7.6% in 2025. For 2026, the Bank of Estonia forecasts GDP growth at constant prices of 3.6%, inflation at a more moderate 2.9%, and a decrease in the unemployment rate to 6.6%, indicating that the economy is slowly recovering. The interest rate environment in Estonia is largely determined by ECB actions. Given that euro area inflation has fallen to the desired level, financial markets do not expect further rate cuts from the ECB in 2026. The expectation is that ECB deposit rates will remain at 2.0%. This expectation is already reflected in Euribor rates, bond markets, and long-term swap prices. Bank deposit interest rates, which fell sharply in 2024, continued to decline in the first half of 2025, but have stabilized since summer 2025. 4 https://www.ecb.europa.eu/press/projections/html/index.en.html 5 https://www.eestipank.ee/press/prognoos-majanduse-elavnemine-tuleb-suurema-riigivola-hinnaga-19122025
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 10 Managing Director´s Statement To evaluate Coop Pank’s performance and results in 2025, one must consider the broader context. In 2024, the economic downturn likely reached its lowest point, after which the first signs of a cyclical recovery began to emerge. In 2025, many macroeconomic indicators improved, and we entered the post -recession recovery phase. The decline and subsequent stabilization of interest rates increasingly translated into the loan market, improving confidence among both businesses and households. Confidence was also s upported by the predictability of major tax changes for businesses and the stability of energy prices, which provided entrepreneurs with a more favourable planning horizon. As a result, postponed investments began to be carried out once again. All of this had a positive impact on both Coop Pank’s performance and the Estonian banking landscape as a whole – in 2025, the volume of both home and business loans grew by approximately 10% market-wide, which is twice the historical average growth rate o f the loan market. Although companies regained investment confidence last year and began to see new growth opportunities, the larger positive effect of these investments on the economy will only become more evident in the second half of 2026 and the first half of 2027. Coop Pank follows a growth strategy, and in line with this, we continued to grow both our customer base and loan portfolio in 2025. At the heart of all our activities is the customer, and our competitive advantage lies in offering more convenient and faster services. We can only grow if we do something better than our competitors. The number of Coop Pank customers grew by 19,000 (+9%) in 2025, reaching 227,000 by the end of the year. Increasingly, opening an account is followed by switching to Coop Pank as the customer’s main bank for daily banking services. However, growing the num ber of so -called home bank clients is also one of our biggest forward-looking challenges. Switching one’s main bank is what drives the growth of demand deposits and enables us to reduce the cost of funding. The bank’s loan portfolio grew by €340 million (+19%) in 2025. For the first time in Coop Pank’s history, our loan portfolio exceeded €2 billion. The loan portfolio’s quality remained at a low-risk level throughout the year. The business loan portfolio grew the fastest, increasing by €207 million (+27%). This was followed by growth in the home loan portfolio by €125 million (+17%). Growth in consumer loans and leasing was moderate. Overall, both business and private customer demand for loans remained strong throughout the year. This robust loan demand was also one of the signs of economic revitalization for us. Coop Pank’s net profit amounted to €28.7 million in 2025, decreasing by 11% year -on-year. The decline in net profit compared to the previous year was mainly caused by the lower -interest economic environment, which the 19% growth in business volumes could not offset. While we anticipated net profit decline in 2024 and 2025, our goal is to return to net profit growth in 2026. In 2025, Coop Pank followed its existing dividend policy and fulfilled the promise made to shareholders by distributing 25% of its 2024 pre -tax profit as dividends. This meant the bank paid out €0.07 per share, transferring a total of €7.2 million in dividends to shareholders. In the first quarter of 2025, Coop Pank issued covered bonds on the Irish stock exchange for the first time, amounting to €250 million with a four-year maturity. This was the first tranche of a €750 million covered bond program. This initial international issuance provided Coop Pank with an additional long-term and stable funding source, which will be used to finance the growth of businesses operating in Estonia and to improve the availability of long -term loans for Estonian individuals and companies. This stable long-term funding allowed the bank to begin intentionally reducing the volume of more expensive term and foreign deposits.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 11 At the end of the year, Coop Pank entered into a guarantee agreement with the European Investment Bank Group, under which part of the credit risk arising from Coop Pank’s loan portfolio will be transferred to EIB Group, thereby providing capital relief to Coop Pank and enabling the bank to issue up to €249 million in new loans to businesses. The new funding will be directed toward projects in Estonia that promote gender equality and environmental sustainability. This is Coop Pank’s first synthetic securitization transaction, and also the first such transaction in the Baltics based entirely on the loan portfolio of a single country – Estonia. The capital relief accompanying the agreement enables the bank to issue new loans to Estonian small and medium -sized enterprises (SMEs) and larger mid-cap companies for projects that support gender equality, economic growth, and environmental sustainability. Additionally, Coop Pank signed a loan agreement at the end of the year with the European Energy Efficiency Fund (EEEF), under which the bank will take an unsecured subordinated loan of €5 million at an interest rate of 6-month Euribor plus 3.25% per annum. The loan is repayable in one lump sum, with the loan term ending on 31 March 2034. The bank has the right to repay the loan early, with the permission of the Finantsinspektsioon (Estonian Financial Supervision and Resolution Authority), after five years from its issuance. In 2025, the credit rating agency Moody’s affirmed Coop Pank’s deposit rating at Baa2 with a positive outlook. The confirmation of both the rating and the positive outlook indicates that Coop Pank remains a reliable bank with strong profitability, solid ca pitalization, and a high -quality credit portfolio. This gives individuals and businesses additional confidence in choosing Coop Pank as their financial partner and keeping their money in a domestic institution. In 2025, Coop Pank also implemented several product changes to make using a domestic bank even more affordable, flexible, and convenient for customers. For example, the bank introduced a group account feature that allows Coop Pank clients to make payments to government accounts directly from their home bank. As a result, payments are processed internally, making transactions more convenient, faster, and more secure for both the bank’s clients and the state. In addition, the bank launched a service enabling merchants to accept payments using an Android smart device, which is an excellent solution for mobile vendors who are constantly on the move. Coop Pank also elevated its cooperation with Coop retail to a new level – a unique cashback was introduced for joint customers. A customer of Coop Pank’s “Kasulik” package now earns 1% cashback on all purchases made in Coop stores when paying with a Coop P ank debit card. The cashback is credited to the customer’s bank account once a month. This is the first large -scale loyalty program in Estonia based on cashback rewards. In 2025, Coop Pank paid out over €270,000 in cashback to its customers. Furthermore, Coop Pank enabled customers to go fully digital by eliminating the need for plastic cards and offering all services via virtual cards. With this, Coop Pank became one of the first banks in Estonia to offer customers full access to virtual card s. Alongside e -services, the bank also increased face -to-face interaction opportunities by opening a branch in the center of Valga, which is regularly open two days a month. Additionally, a larger and more modern branch was opened in Viljandi. Coop Pank ha s a total of 16 branches across 13 cities in Estonia and boasts the largest cash network in the country. Among new loan products, the bank introduced a flexible and convenient small business loan for aspiring entrepreneurs – individuals with a clear vision and a desire to realize their business ideas. The bank also lowered the interest rate of its popular Teacher’s Home Loan and launched a favourable Home Defender Home Loan product aimed at police officers, rescue workers, active servicemen, and members of the Defence League. The Teacher’s Home Loan was awarded a special prize for inventive communication by the Estonian Public Relations Association (EPRA) and won a Kuldmuna (Golden Egg) in corporate communications from the Estonian
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 12 Marketing Association (TULI). In 2025, the Grand Prix for Marketing Act of the Year 2024 was also awarded – it went to the Ministry of Defence’s “Will to Defend” project, in which Coop Pank participates through its “Kaardivägi” donation program. The Minist ry of Defence also awarded Coop Pank the “Supporter of National Defence” gold-level recognition for the second time, acknowledging the bank’s efforts in maintaining income for reservists during exercises and supporting them via the Reservists Fund. Coop Pa nk is among the top two donors to the Reservists Fund. Coop Pank also continued to support Estonian sports in 2025, sponsoring top decathletes, both the men's and women's national volleyball teams, and the initiative “Volleyball in Every Estonian School.” The bank also provides scholarships, thesis topics, and internship opportunities for TalTech students, helping nurture future financial and technology experts. In 2025, Coop Pank became the most recommended bank in Estonia, according to a Kantar Emor survey, and achieved first place for phone service and second place for in -branch service in the annual customer survey conducted by Dive. According to Kantar Emor, Coop Pank also ranks among the ten most reputable employers in Estonia. The bank was awarded the Gold Label for Family -Friendly Employer status and retained its Remote Work Leader certification. Kestliku Ettevõtluse Liit KELL (Sustainable Business Associat ion) granted Coop Pank a Gold Label in its Responsible Business Index for the first time. In the second quarter of 2025, Margus Rink stepped down as Chairman of the Management Board, and in the third quarter, the Supervisory Board appointed Arko Kurtmann as the new Chairman for a three -year term. Kurtmann had served as a member of the Management Board and Head of Business Banking at Coop Pank for the past five years. Following his appointment, the Supervisory Board named Lehar Kütt as the new Head of Business Banking and member of the Management Board. Kütt previously led the business client fin ancing division at the bank for the past four years. As of 1 February 2026, the bank’s Chief Information Officer, Alvar Pihlapuu, also joined the Management Board. He joined Coop Pank on 15 September 2025 and has previously worked as Head of the Developmen t Department at the Estonian Tax and Customs Board, CIO at Holm Bank, and IT Development Manager at Eesti Energia and Swedbank. The bank’s strategic goal is to grow its loan portfolio market share in Estonia to 10% by the end of 2030 and to expand annually at a rate two to three times faster than the market average . This target supports the bank’s ambitious growth strategy and is achievable thanks to being a local bank with efficient management that offers flexible, fast, and convenient banking services . Coop Pank also aims to double its net profit over the next five years and reach at least €60 million in net profit by 2030. This goal supports the bank’s ability to offer shareholders stable and attractive returns. As business volumes grow, the bank aims to operate with high efficiency (cost-to-income ratio below 45%) and deliver an expected return on equity (ROE of at least 15%). We thank all Coop Pank clients, shareholders, and employees for the year 2025. Our goal is to build a bank that becomes a success story for everyone. A success story for our customers. A success story for our shareholders. A success story for our employees. A success story for society. Arko Kurtmann
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 13 Increase in the number of customers By the end of 2025 Coop Pank had 227,000 customers. In a year, the number of customers had increased by 19,000. Of these, 16,000 were private customers and 3,000 were business customers. Decrease in profit Coop Pank’s profits reached 28.7 million euros in 2025, decreasing 11% over the year. Increase in loans Coop Pank’s loan portfolio increased by 19% over the year, reaching 2.11 billion euros by the end of 2025. The growth of the loan portfolio was supported by all business lines engaged in financing. Increase in deposits Coop Pank’s deposits increased by 9% over the year, reaching 2.05 billion euros by the end of 2025. Term deposits increased by 8% over the year, while demand deposits increased by 11%.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 14 Cashback and purchase Insurance with Debit and Credit Cards All Coop Pank personal banking cards double as customer cards for Alexela and Coop stores and come with free purchase insurance, which automatically insures all purchased durable goods up to €2,500 against accidents and theft. Coop Pank customers can deposit and withdraw cash free of charge at Coop store checkouts directly to or from their bank accounts. Additionally, withdrawing cash from ATMs of all other banks is also free of charge for personal banking clients. A customer of Coop Pank’s “Kasulik” package earns a 1% cashback on all purchases made in Coop stores when paying with a Coop Pank debit card. The cashback is transferred to their bank account once a month. Insurance Solutions Coop Kindlustusmaakler continues to provide added value to Coop Pank customers by brokering a wide range of the most common insurance products, such as motor liability, comprehensive, home, and travel insurance. In addition, it offers loan repayment insurance for personal and home loans, as well as property insurance for small and medium-sized enterprises, and insurance for construction machinery and other equipment. Coop Kindlustusmaakler is growing rapidly, and insurance contracts can be arranged conveniently and quickly via Coop Pank's website.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 15 New Strategic Focus: solutions for saving and growing money Coop Pank offers convenient options for saving and growing your money. In addition to term deposits, customers can save and grow their funds flexibly and effortlessly with the Rahasahtel account. Coop Pank also facilitates access to Tuleva's second and third pillar pension funds. In addition, the bank has decided to launch investment services in the coming years. Contribution to Sustainability In 2025, several important steps were taken to support energy efficiency and renewable energy projects. In December 2025, Coop Pank signed a new loan agreement with the European Energy Efficiency Fund (co-financed by the European Union) to raise an additional €5 million in subordinated debt, which will be used to finance energy efficiency and renewable energy projects. Last year, the European Bank for Reconstruction and Development (EBRD) invested €20 million in Coop Pank’s covered bonds to support green financing initiatives. In cooperation with the European Investment Bank Group, a securitization transaction was concluded in December 2025, enabling the provision of up to €249 million in new loans, including at least €49 million for promoting gender equality and €17 million for climate action and environmentally sustainable projects.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 16 Financial results Statement of profit or loss, in millions of euros 2025 2024 2023 2022 2021 Net interest income 73.3 77.6 81.3 50.7 35.5 Net fee and commission income 4.5 4.3 4.8 3.8 3.1 Net other income 1.5 0.0 -0.9 0.1 0.6 Total net operating income 79.4 81.9 85.2 54.6 39.2 Operating expenses -41.5 -40.6 -35.1 -27.2 -22.4 Credit loss allowance -3.3 -4.6 -6.3 -5.2 -2.5 Income tax expense -5.8 -4.5 -4.6 -1.8 -0.8 Net profit 28.7 32.2 39.2 20.4 13.5 Business volumes, in millions of euros 2025 2024 2023 2022 2021 Net loan portfolio 2,114 1,774 1,491 1,301 953 Customer deposits and loans received 2,125 1,886 1,722 1,508 1,099 Subordinated debt 63 63 50 38 17 Shareholders' equity 235 212 186 149 112 Ratios 2025 2024 2023 2022 2021 Average shareholders’ equity, million euros 223 198 167 121 105 Return on equity (ROE) % 12.9 16.2 23.5 16.8 12.9 (net profit / shareholders’ equity, average) Total assets, average, million euros 2,446 2,069 1,866 1,446 1,055 Return on assets (ROA), % 1.2 1.6 2.1 1.4 1.3 (net profit / total assets, average) Cash and interest-bearing assets, average, million euros 2,429 2,054 1,857 1,434 1,039 Net interest margin (NIM), % 3.0 3.8 4.4 3.5 3.4 (net interest income / interest-bearing assets, average) Cost to income ratio, % 52.3 49.6 41.2 49.7 57.2 (total operating costs / total net operating income) Loans to borrowed funds ratio, % 88.8 94.1 86.6 86.3 86.8 (net loans / customer deposits, loans received and debt securities) Dividend to net profit ratio, % 22.4 22.7 22.3 20.3 - (net dividend / net profit for the previous period) Liquidity Coverage Ratio LCR, % 202.3 206.7 293.4 175.8 201.7 Net Stable Funding Ratio NSFR, % 119.6 127.2 134.3 144.1 133.5 Leverage Ratio LR, % 7.9 8.8 8.4 7.4 6.7 (as defined by the CRD IV)
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 17 Capitalisation and risk positions The methodology for calculating the capital base for 2025 has been revised in accordance with the new Capital Requirements Regulation (CRR3). Capital base, in thousands of euros 31.12.2025 31.12.2024 Tier 1 capital Paid-in share capital and share premium 98,771 96,892 Statutory reserve capital 8,424 6,815 Retained earnings excl. profit for the reporting period 96,989 73,629 The accepted profit of the reporting period* 16,449 19,545 Other accumulated comprehensive income/expense** -104 298 Goodwill as intangible asset (-) -6,757 -6,757 Intangible assets (-) -9,212 -12,954 Adjustment of value arising from requirements of reliable measurement (-) -55 -38 Other deductions from Tier 1 Capital (-) -1,081 -1,820 Common Equity Tier 1 (CET1) 203,424 175,610 Additional Tier 1 capital 28,148 28,148 Total Tier 1 capital 231,572 203,758 Subordinated debt 35,000 35,000 Tier 2 capital 35,000 35,000 Eligible capital for capital adequacy calculation 266,572 238,758 Risk-weighted assets (RWA) Central government and central banks using the standardised approach 0 6,183 Regional governments or local authorities 11 0 Credit institutions, investment companies and local governments using the standardised approach 8,118 2,985 Companies using the standardised approach 279,435 124,619 Retail receivables using the standardised approach 187,554 191,647 Receivables secured by mortgage on real estate using the standardised approach 709,500 638,648 Receivables past due using the standardised approach 8,456 11,217 Acquisition, development and construction (ADC) standardised approach 144,343 131,950 Other assets using the standardised approach 16,976 9,984 Total credit risk and counterparty credit risk 1,354,393 1,117,233 Risk exposure for operational risk (ASA) 78,318 112,728 Risk exposure for credit valuation adjustment (RBA)*** 4,863 0 Total risk-weighted assets 1,437,574 1,229,961 CET1 capital ratio % 14.15% 14.28% Tier 1 capital ratio % 16.11% 16.57% Capital adequacy ratio % 18.54% 19.41% * The accepted profit of the reporting period includes profit for the nine-month period ending on 30 September, which was approved by the Financial Supervisory Authority and from which expected dividend payments have been deducted. ** Other accumulated comprehensive income includes revaluation reserve of financial assets at fair value through other comprehensive income. *** Risk exposure for credit valuation adjustment (CVA) includes the credit valuation adjustment for derivatives held for hedge accounting using reduced basic approach (RBA).
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 18 Own funds requirements (31.12.2025) Core Tier 1 capital ratio 4.50% Core Tier 1 capital/total risk exposure Tier 1 capital ratio 6.00% Tier 1 capital/total risk exposure Total capital ratio 8.00% Total capital/total risk exposure Pillar 2 requirement (P2R) 2.75% Of total risk exposure Pillar 2 guidance (P2G) 1.50% Of total risk exposure Systematically important banks buffer 0.50% Of total risk exposure Capital conservation buffer 2.50% Of total risk exposure Countercyclical capital buffer rate 1.50% Of total risk exposure As at 31.12.2025, the Group overall capital requirement ratio, incl, Pillar 2 requirement, Pillar 2 guidance and capital buffers, was 16.75%. The capital conservation buffer of the Group as at 31.12.2025 was 35,939 (31.12.2024: 30,749) thousand euros. The systematically important banks buffer as at 31.12.2025 was 7, 188 thousand euros. The countercyclical capital buffer of the Group as at 31.12.2025 was 21,320 (31.12.2024: 18,449) thousand euros. So, the combined buffer of the Group as at 31.12.2025 was 64,448 (31.12.2024: 49,198) thousand euros. As at 31.12.2025 and also as at 31.12.2024, the Group was in compliance with all regulatory capital requirements. With its decision of 28.11.2024, Eesti Pank designated Coop Pank AS among systemically important credit institutions. The decision entails an obligation for Coop Pank to maintain an additional capital buffer of 0.5 percent for a systemically important credit institution. The buffer requirement applies to the total risk exposure of the credit institution and must be met by common equity tier 1 own funds (CET1 capital). The aim of the systemically important institutions buffer is to increase the resilience of systemically important market participants. The additional capital buffer obligation for Coop Pank applies from 1 January 2025. According to the Regulation (EU) number 575/2013 article 392 of the European Parliament and of the Council, an exposure to a client or group of clients is considered as risky concentration where its value is equal to or exceeds 10% of the credit institution's Tier 1 capital (see the table on previous page about capitalisation). According to the EU Regulation number 575/2013 article 400 paragraph 1 the exposures relating to customers as a result of undrawn commitments are exempt from the applicable concentra tion of exposures limits. In addition, exposures to central governments and central banks which have been assigned a risk weight of 0% are exempt from the applicable concentration of exposures limits. According to the EU Regulation number 575/2013 article 395 paragraph 1 the value of an exposure to a client or group of clients, after considering the effect of credit risk hedging, may not be more than 25% of the credit institution's Tier 1 capital. As at 31.12.2025 and 31.12.2024 , the exposure of any credit institution, client or group of clients did not exceed the risk concentration limits established by Regulation 575/2013.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 19 Group management system The Coop Pank AS Group acts based on the principle of consolidation, which entails the establishment of collective and coordinated objectives, the sharing of common core values and functioning of competent governing bodies to manage risks across the Group. The management of Coop Pank AS has three levels, where the governing bodies are the General Meeting of Shareholders, the Supervisory Board and the Management Board. The General Meeting of Shareholders is the highest governing body of Coop Pank AS, which is open to all shareholders and which normally takes place once a year. The Supervisory Board is appointed by the General Meeting of Shareholders for up to five -year term. Shareholders who hold shares at least 1/10 of the share capital are able to nominate candidates for election of members of the Supervisory Board in the form of a draft resolution of the General Meeting of Shareholders. The candidate for member of the Supervisory Board must have relevant knowledge and experience to participate in the management body of the bank, the composition of the Supervisory Board must be diverse and the Supervisory Board must have sufficient independent members. The Management Board is appointed by the Supervisory Board for up to five -year term. When appointing members of the Management Board as collegial body, the Supervisory Board ensures that the Management Board that is formed is sufficiently diverse in composition through a profile of knowledge, skills, experience and education in order to make sure that the Management Board has the capability to effectively manage all of the bank's operating segments. Members of the governing body are appointed based upon requirements applicable to members of governing bodies pursuant to the provisions of the Credit Institutions Act: any appointed individual must have the necessary knowledge, skills, experience, education, professional qualifications and impeccab le reputation in business to be able to manage a credit institution. A person whose earlier activities have caused a bankruptcy or compulsory liquidation or revocation of the activity license of a company, or from whom the right to engage in economic activity has been taken away pursuant to law, or whose earlier activities as a manager of a company have shown that he or she is not capable of organising the management of a company such that the interests of the shareholders, members, creditors and clients of the company are adequately protected or whose earlier activities have shown that he or she is not suitable to manage a company for other good reasons cannot be elected or appointed manager of a credit institutio n. In order to ensure compliance with the aforementioned requirements, the bank has adopted an internal policy for the evaluation of the suitability of a member of its governing body: suitability is evaluated before the individual is appointed member of a governing body and, if necessary, during their term of office as a member. The bank has established a policy for the regular training of members of the management board in order to ensure sustained competency of its management board members.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 20 Management Board Supervisory Board RAINER ROHTLA Chairman of the Supervisory Board Member of audit committee Member of remuneration committee Chairman of the Management Board of Coop Eesti Keskühistu VILJAR ARAKAS Member of the Supervisory Board Chairman of the Management Board of EfTEN Capital JAAN MARJUNDI Member of the Supervisory Board Member of remuneration committee Chairman of the Management Board of Harju Tarbijate Ühistu RAUL PARUSK Member of the Supervisory Board Member of remuneration committee Member of the Management Board of Kodea ROMAN PROVOTOROV Member of the Supervisory Board Head of Antsla Tarbijate Ühistu SILVER KUUS Member of the Supervisory Board Member of audit committee Head of development of Agron Halduse Head of Lorikoru Capital ARKO KURTMANN Chairman of the Management Board since September 2025 Previously Member of the Management Board and Head of Business Banking at Coop Pank, and prior to that, Head of Corporate Banking at LHV Pank. ALVAR PIHLAPUU Member of the Management Board since 1 February 2026 Previously Head of the Development Department at the Estonian Tax and Customs Board, CIO at Holm Bank, and IT Development Manager at Eesti Energia and Swedbank. HEIKKO MÄE Member of the Management Board since February 2020 Previously CEO at Magnum Veterinary and Head of Energy Trading in Eesti Energia KAREL PARVE Member of the Management Board since November 2023 Previously Head of Private Banking at LHV Pank LEHAR KÜTT Member of the Management Board since September 2025 Previously Head of Business Client Financing at Coop Pank, and prior to that, Chairman of the Management Board at Estonian Business and Innovation Agency PAAVO TRUU Member of the Management Board since February 2022 Previously CFO at Coop Estonia and Magnum
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 21 The structure of the Group is designed and approved by the management board of the bank in accordance with the provisions of legislation, the articles of association and the strategies of the bank and its subsidiaries, as well as by adhering to the instructions provided by the Supervisory Board and the development priorities of the bank. The Group's organisational structure is based on a functional structure. Responsibility for the activities of the bank and its subsidiaries is divided between the members o f the bank's management board according to field of activity and function, thereby establishing areas of responsibility. The allocation of areas of responsibility among members of the management board is based on the principle of separation of functions, which ensures the separation of controlling entities from controlled entities. The strategy, purposes and principles of the risk management of the Group is approved by the Supervisory Board of the bank. The Management Board of the bank and the members of Supervisory Boards of the entities belonging to the Group individually approve the plan of act ion for every company or business line. The core values stated in the Group's strategy stand for the whole Group. The Group manages risks across the entire Group and the following committees have been established: ● The Audit and Risk Committee serves as an advisory body in respect of accounting, auditing, risk management, legal compliance, internal control, internal audit and general supervision. ● The Remuneration Committee’s role is to evaluate the implementation of remuneration policy and their adherence to the operational objectives of the bank and to evaluate the effect of decisions related to remuneration to compliance with requirements set forth concerning the Group's risk management, own funds and liquidity. ● The Credit Committee is the decision -making body for making credit decisions. The task of the committee is to ensure through their decision -making the adherence to common credit policy across the Group. ● The Asset/Liability Management Committee is a competent body on a group -wide basis for the management of liquidity risk, interest rate risk of the bank portfolio and securities portfolio, designing of the structure of assets and liabilities, management of profitability and management of capital. ● The task of the Account Establishment Committee is to guide through its decisions the establishment and discontinuing of relationships with high-risk clients when necessary. ● The main task of the Investment Projects Committee is to lead different information system developments in order to attain the strategic goals of the Group. A group-wide internal control system has been implemented by the Group encompassing all operational and management levels for the purposes of ensuring the effectiveness of the Group's operations, reliability of financial reporting, compliance of operations with applicable laws and other legislation, internal regulations approved by governing bodies and the adoption of decisions based on reliable and relevant information. The control is based on a 3-level control system. The first level constitutes internal control that takes place internally within each division. The second level is made up of risk management and compliance functions that operate as autonomous and independent control units. The third level comprises the internal audit unit that exercises control over the entire operations of the Group. The Group has a uniform remuneration policy. Employees are paid salaries and performance fees according to the market level. In addition to monetary incentives, employees also have many non -monetary benefits such as flexible working hours, the possibility to work from home, different common activities and benefits for health insurance and sports. The Group's employees work under employment contracts, while members of the management board work based on authorisation agreements. For the bank, employee satisfaction and development are important. To ensure this, various development training and joint events are organised, such as the Gala of the beginning of the year, internal communication events and summer days. Annual and semi-annual interviews are conducted with all staff throughout the year to ensure staff development and that their activities are aligned with the Bank's strategy and common goals.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 22 Group structure Until February 2026, the Bank's Management Board consisted of five members, and as of February, the Board continues with six members. The Supervisory Board of Coop Pank AS has appointed the bank’s Head of IT, Alvar Pihlapuu, as a new Member of the Manageme nt Board. In addition, Alvar Pihlapuu has been appointed as a Member of the Supervisory Boards of Coop Pank AS's subsidiaries Coop Liising AS and Coop Kindlustusmaakler AS. His mandate as a Management Board Member and as a Member of the Supervisory Boards of subsidiaries will commence on 1 February 2026 and will last for a term of three years.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 23 Shares Coop Pank AS has issued ordinary shares, each share giving one voting right. The shares are listed on the main list of Nasdaq Tallinn with ISIN code EE3100007857 as of 10.12.2019. The share subscription price during the IPO was 1.15 euros. As of 31.12.2025, the share price was 2.11 euros. In 2025 the lowest tradable price was 1.90 euros and the highest price was 2.35 euros. As of 31.12.2025, the market value of the bank was 219.2 million euros on the basis of the share price. Throughout the year, the turnov er of transactions totalled 23,1 million euros and 11.2 million shares changed hands with an average transaction price of 2.05 euros. The ratio of share price to earnings per share at the end of 2025 was 7.6. The basis for finding the ratio is the market capitalisation of Coop Pank as of 31.12.2025 divided by the net profit of the year. The book value of the share as of 31.12.2025 was 2.26 euros and the ratio of the share price to the book value of the share was 0.93. As at 31.12.2025 shareholders with holdings over 5% are: Coop Investeeringud OÜ 21.86% Andres Sonn 8.21% In addition, the member cooperatives of Coop Eesti Keskühistu hold a total of 18.84% of the total amount of shares. Separately, none of them hold over 5%. The bank has 32,881 shareholders as of 31.12.2025, of which 56 shareholders are institutional investors, i.e. owning at least 100,000 shares. From all shareholders 32,585 (99.1%) are residents of the Republic of Estonia and 296 (0.9%) shareholders are residents of other countries. The shares are entitled to a dividend (see chapter ‘Dividend policy’). In exercising the share option programmes, the shareholders have delegated the authority to issue new shares to the Supervisory Board. Coop Investeeringud 21.9% Regional consumer coops 18.8% Andres Sonn 8.2% CM Capital 4.5% Tallinna linnakantselei 2.8% Others 43.8% Shareholder distribution as at 31.12.2025
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 24 Dividend policy At the shareholders’ meeting on 08.11.2019 the dividend policy was approved, according to which the consolidation bank aims to pay a dividend of 25% of the annual earnings before taxes (incl. income tax), attributable to shareholders of the Group. Preconditions for dividend payment are: • compliance with external and internal capital and liquidity requirements; • the level of capital after dividend payments shall be sustainable and sufficient to ensure business growth and investment needs. Dividend payments have been made as follows: On May 7, 2024, Coop Pank paid a dividend of 0.087 euros (net) per share from the profit earned in 2023, in the total net amount of 8,895 thousand euros. Part of the dividends (1/3 from dividends paid out in 2022 and 2023) were taxed at a preferential rate of 14/86 and the remaining part at a rate of 20/80. On May 6, 2025, Coop Pank paid a dividend of 0.07 euros (net) per share from the profit earned in 2024, in the total net amount of 7,209 thousand euros. The dividend was taxed at an income tax rate of 22/78.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 25 Corporate Governance Report Coop Pank implements the Corporate Governance Recommendations (hereinafter CGR) approved by the Nasdaq Tallinn Stock Exchange and the Financial Supervision Authority since the listing of Coop Pank AS shares on the Tallinn Stock Exchange main list on 10 December 2019. The report pr ovides an overview of Coop Pank management and compliance with CGR guidelines. Coop Pank AS complies with the recommendations of the Good Corporate Governance, unless otherwise stated in this report. 1. General Meeting Coop Pank is a public limited company whose management bodies are the General Meeting of Shareholders, the Supervisory Board and the Management Board. The General Meeting is the highest directing body of the Coop Pank, where the shareholders exercise their rights. The co mpetence of the General Meeting is provided by law and the Articles of Association of Coop Pank. For example, the General Meeting is competent to amend the Articles of Association, increase and decrease the share capital, decide on the issue of convertible bonds, elect and extend the term, as well as decide on the early removal of the Supervisory Board members, approve the annual report and distribute the profit, approve the share option programme and appoint and dismiss the auditor. Every shareholder is entitled to participate in the General Meeting, to speak at the General Meeting on the topics in the agenda and to ask reasonable questions and make proposals. In 2024, no shareholders' questions on agenda topics were raised before the General Meeting. A shareholder may attend the General Meetings and vote at the meeting in person or through a duly authorized representative. The General Meetings are held on business days in Tallinn. The General Meeting is called by the Management Board. The Annual General Meeting, which approves the annual report, is held at least once a year. The Management Board shall call an Annual General Meeting not later than four months after the end of the financial year. The Management Board shall give the notice of both the Annual and Special General Meetings at least three weeks in advance by publishing the notice of convening the General Meeting through the information system of the Nasdaq Tallinn Stock Exchange as well as on its homepage and at least through one daily national newspaper. The agenda of the General Meeting, the proposals of the Management Board and the Supervisory Board, the draft resolutions and other relevant materials shall be made available to the shareholders before the General Meeting. In 202 5, from the announcement of the General Meeting until the day of the General Meeting, the shareholders had access to the materials and draft resolutions of the General Meeting and other documents required by law on Coop Pank's webpage and at Coop Pank’s hea dquarters on workdays from 09:00 -17:00 at Maakri 30, Tallinn. Shareholders are given the opportunity to ask questions on the agenda before the Genera l Meeting. Following and participation in the General Meeting via means of communication has not been made available (CGC clause 1.3.3), since there has been no demand nor suitable technical solution for that. In 2025 one General Meetings were held – an Annual General Meeting. The Annual General Meeting of Shareholders that took place on 16 April 2025 approved the 2024 Annual Report, distributed the profit for the year 2024 and decided to pay dividends. Additionally, the General Meeting approved share option program of the Bank for the period of 2025 – 2026. The General Meeting also decided to exclude the pre -emptive subscription rights of the existing shareholders for the shares issued to option holders in accordance with previous option program. The General Meeting was held in the Estonian language. The meeting was chaired by Mariann Suik, Head of the Legal Department of Coop Pank, and lawyer Renno Mägi took minutes of the meeting. All Management Board
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 26 members of Coop Pank attended the General Meeting as well as Supervisory Board members Rainer Rohtla, Jaan Marjundi, Raul Parusk, Roman Provotorov and Silver Kuus. Also, the auditor of Coop Pank from AS PricewaterhouseCoopers, Jüri Koltsov, attended the meeting. 2. Management Board 2.1. Responsibilities of the Management Board The Management Board is the governing body of Coop Pank that represents and manages Coop Pank on a daily basis. According to the Articles of Association, any member of the Management Board may represent Coop Pank in all legal acts. The members of the Board are elected an d removed by the Supervisory Board. The consent of the Board member is required for their election. According to the Articles of Association of the Bank, the Management Board comprises three to seven members. The term of office of a Management Board member is up to five years. Each member of the Management Board has their own area of responsibility, which is determined by the agreement of the Management Board member. On the basis of the authorisation received from the Supervisory Board, the chairman of the Supervisory Board shall enter into an agreement with the members of the Management Board to perform their duties. According to the restrictions set out in the Credit Institutions Act, until 2021 , the members of the Management Board of Coop Pank could not simultaneously participate in the work of the Management Board or Supervisory Board of other companies. Contrary to the above, there was no restriction on work in the management bodies of the Gro up’s companies. From 2021, the members of Coop Pank's Management Board may additionally hold one member of the Management Board and two members of the Supervisory Board, or four members of the Supervisory Board. The positions of head of the group shall be considered as one position. In accordance with the agreements concluded with the Management Board members, the extension of the term of office of a Management Board member shall be decided 3 months before the expiry of their term of office. The Supervisory Board shall appoint the chairman of the M anagement Board. The chairman of the Management Board shall organise the work of the Management Board. The Supervisory Board may dismiss a member of the Management Board regardless of the reason. A member of the Management Board may resign from the Managem ent Board regardless of the reason with prior notice to the Supervisory Board. The rights and obligations arising from the agreement, concluded with the member of the Management Board, shall expire in accordance with the agreement. Persons with sufficient knowledge and experience to participate in the work of Coop Pank's Management Board shall be elected as members of the Management Board. For the selection and evaluation of Coop Pank's Management Board and Supervisory Board members, Coop Pank has adopted the "Suitability assessment policy", which is implemented in conjunction with applicable legislation (the Credit Institutions Act in particular) as well as with the recommendations manual and other relevant guidance documents issued by the Financial Supervision Authority and/or other supervisory agencies. As of 31.12.2025, the Management Board of the Coop Pank comprised of five members: Arko Kurtmann (chairman), Paavo Truu, Heikko Mäe, Lehar Kütt and Karel Parve. The responsibilities of Management Board members are: Arko Kurtmann – general management, Paavo Truu – financial management, Heikko Mäe – risk management, Lehar Kütt – corporate banking, Karel Parve – retail banking. Arko Kurtmann graduated with a Master's degree in Economics and Business from the Estonian University of Life Sciences in 2003. Arko Kurtmann has worked for AS LHV Pank as the head of the business banking department and a member of the credit committee in 2012 -2019. Arko Kurtmann is a member of the management board of Corby Capital OÜ. Currently, Arko Kurtmann is also a member of the Supervisory Board of Coop Pank subsidiaries, Coop Liising AS and Coop Kindlustusmaakler AS.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 27 Paavo Truu obtained a Bachelor's degree in 1996 from the Faculty of Economics of the University of Tartu, majoring in marketing, finance and banking, and has since participated in several professional further training courses. Paavo Truu worked as a board member and financial director of Coop Eesti Keskühistu from 2018 to 2022. In the years 2013-2018, he was a member of the board of AS Magnum and in the same period was also a member of the supervisory board of several subsidiaries of AS Magnum (Magnum Denta l OÜ, AS Magnum Veterinaaria). In 2012 -2013, Paavo Truu was the financial director of Alexela Group OÜ and in 2007 -2012, a member of the board of Bauhof Grupp. Currently, Paavo Truu is also a member of the supervisory board of Coop Pank's subsidiaries Coop Liising AS and Coop Kindlustusmaakler AS. He is also a member of the management board of Solaris Konsult, the private company he owns. Heikko Mäe holds a Master of Arts degree in Law from Audentes University (2008). In the period of 2004 -2008 Heikko Mäe has worked in AS PricewaterhouseCoopers Advisory as the risk management senior consultant, in 2008-2013 in Eesti Energia AS as Director of the Risk Management and Internal Auditing Unit and in 2013-2015 as Director of Energy Trading in Eesti Energia AS. In the period of 2015-2019 Heikko Mäe worked as the head of AS Magnum Veterinary and in 2016-2020 as Supervisory Board member of TULEVA Fondid AS. Heikko Mäe has been working at the bank as a risk manager since 2019. Currently, Heikko Mäe is also a member of the Supervisory Board of Coop Pank subsidiaries Coop Liising AS and Coop Kindlustusmaakler AS and a member of the board of SIA Prana Property. Lehar Kütt obtained a higher education degree in Business Administration in 2022 from the Pärnu College of the University of Tartu. In 2007, he earned a Master’s degree in Economics from the University of Tartu, and in 2019, a Master’s degree in Digital Tr ansformation in Enterprises from Tallinn University of Technology . Lehar Kütt has been Head of the Corporate Finance Business Line at Coop Pank AS since 2021. Previously, among other roles, they served as the Chairman of the Management Board of Estonian Business and Innovation Agency. Karel Parve holds a Bachelor's degree in International Relations from Bucknell University. Since 2019, he has been working at LHV Pank AS, where he last managed the private banking unit. He has previously worked at Luminor Bank AS and AS Swedbank. Karel Pa rve is also a member of the Supervisory Board of the Coop Pank subsidiaries Coop Liising AS and Coop Kindlustusmaakler AS. The Management Board carries out its day-to-day management decisions independently, considering the best interests of the bank and its shareholders, while excluding any personal interests. The members of the Management Board are responsible for the day -to-day management of Coo p Pank and for developing and implementing the bank's strategy. The Management Board ensures proper functioning of risk management and internal control considering Coop Pank's area of activity. 2.2. Remuneration principles of managers The purpose of Coop Pank's remuneration policy is to provide fair, motivating, transparent and legally compliant remuneration. The Supervisory Board has the right to decide on the remuneration of the members of the Management Board. The Remuneration Committee of the bank annually re views the remuneration principles of the Management Board. When determining the remuneration of a member of the Management Board, the Remuneration Committee shall, in particular, consider the responsibilities of the individual member of the Management Boar d, their performance, the overall performance of the Management Board, as well as the financial position of the Coop Pank, the current state and future direction of the business in comparison with the corresponding indicators of companies of the same economic sector. The remuneration of a Management Board member must be such as to motivate the person to act in the best interests of Coop Pank. The basic wage of the Management Board members is agreed in the Management Board member agreement. The remuneration principles of the Management Board members and/or employees exercising internal control and risk management functions must ensure their independence and
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 28 objectivity in performing their risk management/internal control tasks. The remuneration of these employees must not depend on the results of the departments controlled and the set objectives must be described at the individual employee level. Coop Pank applies an annual performance pay, commensurate with achieving the objectives, to all Group employees, plus a long-term option programme for key employees. Gross remuneration paid to the Management Board members in 2025 in euros: Gross remuneration paid in 2025 Basic salary Performance pay Value of options granted Total remuneration Arko Kurtmann 161,205 24,000 92,714 277,919 Paavo Truu 148,000 24,000 92,714 264,714 Heikko Mäe 156,068 24,000 92,714 272,782 Karel Parve 140,000 20,000 77,280 237,280 Lehar Kütt 47,159 0 0 47,159 Margus Rink 202,341 32,000 123,581 357,922 In the event of an extraordinary termination of the Management Board member's agreement by the bank, the Management Board member shall be paid severance pay in the amount of 6 months’ remuneration. The severance pay is not payable if the termination is due to significant cul pable failure to fulfil official duties or to any other act that seriously damages the bank's reputation. If the term of office of a member of the Management Board is not extended, the Management Board member is entitled to a severance pay in the amount of 3 months’ remuneration. Shares, bonds and share options owned by the Management Board members and their associated persons as at 31.12.2025: Holder of securities Shares Holding Bonds Arko Kurtmann (partly by the Corby Capital OÜ) 135,600 0.13% 0 Heikko Mäe 164,070 0.16% 0 Paavo Truu (by the Solaris Konsult OÜ) 76,948 0.07% 100 Lehar Kütt 24,372 0.02% 0 Holder of options Quantity Strike price Subscription term Arko Kurtmann 47,900 1.526 2026 Heikko Mäe 47,900 1.526 2026 Paavo Truu 41,900 1.526 2026 Margus Rink 71,900 1.526 2026 Arko Kurtmann 86,200 1.875 2027 Heikko Mäe 86,200 1.875 2027 Paavo Truu 86,200 1.875 2027 Karel Parve 42,900 1.875 2027 Margus Rink 120,800 1.875 2027 Arko Kurtmann 83,500 1.053 2028 Heikko Mäe 83,500 1.053 2028 Paavo Truu 83,500 1.053 2028 Karel Parve 69,600 1.053 2028 Margus Rink 111,300 1.053 2028 No significant transactions took place between Coop Pank and the members of the Management Board or persons close to or associated with them in 2025. There are no other benefits and bonuses from Coop Pank to the members of the Management not mentioned in this chapter.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 29 2.3. Conflicts of interest Coop Pank has established a Group-wide “Policy of Management of Conflicts of Interest”, under which members of the Group’s corporate bodies, heads of departments and client managers are required to submit and annually update their Declaration of Financial Interests and Credibility. Also, a new declaration must be submitted immediately after a change of significant circumstances which constitute or are likely to give rise to a conflict of interest. Transactions between the bank and the members of the Management Board or persons close to or associated to them shall be subject to the prior approval of the Supervisory Board, except for transactions made on the basis of market prices within the framework of daily economic activity. In 2025, no such transactions took place. Management Board members are not members of the Management Board or Supervisory Board of other issuers, except Paavo Truu who is a member of the board of a private limited company he owns. The Management Board members of Coop Pank are also the Supervisory Board members of Coop Pank's subsidiaries; the Management Board member, fulfilling the duties of risk manager, is also a Management Board member of real estate management company established in Latvia which are part of the Group. The Management Board members have no shareholdings above 5% in other companies who are Group’s business partners, suppliers, clients or other related companies. 3. Supervisory Board The Supervisory Board is Coop Pank's governing body, which plans and organises Coop Pank's management and supervises the activities of the Management Board. The Board determines and periodically reviews Coop Pank's strategy, general business plan, principles of risk management and annual budget. The Supervisory Board comprises five to seven members. The term of office of the Supervisory Board members is up to five years. The members of the Supervisory Board shall elect from among themselves the chairman of the Supervisory Board who shall organise the activities of the Supervisory Board. The Supervisory Board regularly evaluates the activities of the Management Board by implementing Coop Pank's strategy, as well as evaluates the bank's financial position, risk management systems, compliance with prudential regulations and the lawfulness of the activities of the Management Board. Persons with sufficient knowledge and experience to participate in the work of the bank's Supervisory Board shall be elected as members of the Supervisory Board. For the selection and evaluation of the bank's Management Board and Supervisory Board members, Coop Pank has adopted a "Suitability assessment policy", which is implemented in conjunction with applicable legislation (the Credit Institutions Act in particular) as well as with the recommendations manual and other relevant guidance documents issued by the Financial Supervision Authority and/or other supervisory agencies. As at 31.12.2025, the Supervisory Board of Coop Pank comprised of six members and they were Rainer Rohtla (chairman, term 12.04.2026), Viljar Arakas (term 12.04.2026), Jaan Marjundi (term 12.04.2026), Roman Provotorov (term 12.04.2026), Raul Parusk (term 12.04.2026) and Silver Kuus (term 12.04.2026). In the meaning of CGR there are three independent members in Coop Pank´s Supervisory Board – Viljar Arakas, Raul Parusk and Silver Kuus. Rainer Rohtla has obtained higher education in logistics management from Jyväskyla university of Applied Sciences, Finland. Rainer Rohtla has worked in top management positions in various logistics management related international enterprises, latest of them from 2019 -2022 as General Manager of Via 3L Group. From 2023 February he acts as chairman of the board of Coop Eesti Keskühistu.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 30 Viljar Arakas obtained a Bachelor's degree in business administration from EBS International University in 2003 and has completed his second Bachelor's degree at Hogeschool NOVI in the Netherlands. Viljar Arakas is a founding member and a member of the Management Board and CEO of EfTEN Capital AS, the largest management company focused on commercial real estate in the Baltic States. Roman Provotorov obtained a higher education in economics and management from the Estonian Agricultural University (currently Estonian University of Life Sciences). Since 1995, he is a head of Antsla Tarbijate Ühistu (Antsla Consumer Association) and, since 2017, member of the Supervisory Board of Coop Pank AS. Jaan Marjundi obtained a higher education in process engineering from Tallinn Polytechnical Institute (currently TalTech). For years, he has worked in top management positions of retail businesses. In 2007 - 2025, Jaan Marjundi was chairman of the Management board of Harju Tarbijate Ühistu (Harju Consumer Association) and, since 2017, member of the Supervisory Board of Coop Pank AS. Raul Parusk obtained Master’s degrees in political economy from Moscow National University and in business management from Vienna Business School. He has worked in top management positions in different companies, including credit institutions. From 2017 until August 2 021, Raul Parusk was a member of the management boards of Forus Grupp OÜ, Forus Security Eesti AS and Forus Haldus OÜ. From March 2022, Raul Parusk has been a member of the board of Kodea OÜ. Silver Kuus has obtained a Master’s degree in international business management from Estonian Business School. Silver Kuus has worked in top management positions in different financial institutions, the latest of them being manager of corporate banking at Luminor Bank AS from 2017 -2019. Currently, he is manager of a business consulting company OÜ Lorikori Capital. The General Meeting of Shareholders has decided to set the gross monthly remuneration of the members of the Supervisory Board at EUR 1,500, the chairman at EUR 2,000. There is no severance pay or other additional benefits for members of the Supervisory Board. Gross remuneration paid to the Supervisory Board members in 2025 in euros: Gross remuneration paid in 2025 Rainer Rohtla 24,000 Viljar Arakas 18,000 Jaan Marjundi 18,000 Roman Provotorov 18,000 Raul Parusk 18,000 Silver Kuus 18,000 Shares and bonds owned by members of Supervisory Board as of 31.12.2025: Shares Holding Bonds Viljar Arakas (by the Miemma Holding OÜ) 38,094 0.04% 114 Jaan Marjundi 83,406 0.08% 11 Roman Provotorov 17,000 0.02% 0 Raul Parusk (by the Sulvanius Invest OÜ) 6,201 0.01% 0 As set out in clause 2.3 of this report, the Supervisory Board members shall also submit a declaration of their financial interests and reliability. No significant transactions took place between Coop Pank and the members of the Supervisory Board or persons close to or associated with them in 2025. There are no other benefits and bonuses from Coop Pank to the members of the Supervisory Board not mentioned in this chapter.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 31 The Supervisory Board members have no shareholdings above 5% in other companies who are Group’s business partners, suppliers, clients or other related companies. In 2025, fifteen Supervisory Board meetings were held and in addition three Supervisory Board decisions were made without convening a meeting. The members of the Supervisory Board participated in all meetings and votes, except for Viljar Arakas who could not attend the voting held in April and Silver Kuus who could not attend the voting held in August and September The Supervisory Board has formed three committees: the Audit and Risk Committee, the Nomination Committee and the Remuneration Committee. The Committees act under the supervision of the Supervisory Board as advisory bodies to the Supervisory Board. 3.1. Audit and Risk Committee The Audit and Risk Committee is an advisory body to the Supervisory Board in the areas of accounting, auditing, risk management, internal control and audit, supervision and budgeting and the legality of activities. The activities of the Audit and Risk Comm ittee are primarily based on the Auditors Activities Act, the Credit Institutions Act and the rules of procedure of the Audit and Risk Committee, approved by the Supervisory Board. The Audit and Risk Committee is responsible, inter alia, for supervision of the audit process of the annual or consolidated accounts and the independence of the sworn auditor. The Audit and Risk Committee also advises the Supervisory Board and the Manageme nt Board on risk management principles and supervises risk management. The Audit and Risk Committee makes proposals to the Supervisory Board for the appointment or removal of the external and internal auditor, as well as for changes in risk management prin ciples, elimination of problems in the organisation and compliance with legal acts. At least once a year, the external auditor shall report to the Audit and Risk Committee on the findings of the audit. The Audit and Risk Committee shall comprise at least two members, elected by the Supervisory Board. As of 31.12.2025 the Audit and Risk Committee comprised of four members and they were Veiko Haavapuu (chairman), Rainer Rohtla, Silver Kuus and Stan Nahkor. No remuneration is paid to the members of the Audit and Risk Committee who are also members of the Supervisory Board. Remuneration for Veiko Haavapuu and Stan Nahkor is 400 euros per meeting. 3.2. Remuneration Committee The responsibility of the Remuneration Committee is to evaluate the implementation of the Remuneration Principles approved by Coop Pank's Supervisory Board and their consistency with Coop Pank's business objectives, the impact of the remuneration decisions on meeting the requiremen ts set to Coop Pank's risk management, own funds and liquidity. The Remuneration Committee also supervises the remuneration of members of the Management Board and employees subject to increased requirements. The Remuneration Committee comprises at least two members who are elected by the Supervisory Board. As of 31.12.2025, the Remuneration Committee comprised of four members and they were Rainer Rohtla (chairman), Jaan Marjundi, Raul Parusk and Irja Rae. No r emuneration is paid to the members of the Remuneration Committee who are members of the Supervisory Board. Irja Rae's remuneration is 400 euros per meeting. 3.3. Nomination Committee Nomination Committee is a working body subordinate to the Coop Pank's Supervisory Board, aimed at ensuring transparency in the selection process and objectivity in the suitability evaluation of Members of the Management and Supervisory board.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 32 The Nomination Committee's responsibilities include, among other things, • Determining the composition of the management and supervisory board based on the Coop Pank's strategy • Managing the selection process of management and supervisory board members, assessing the balance of candidates' knowledge, skills, and experience • Evaluating the education, experience, and professional suitability of management and supervisory board members, as well as their collective ability to act, based on the Coop Pank's needs • Reviewing the principles for ensuring the diversity of the management and supervisory board and assessing their appropriateness • Setting target levels for the representation of individuals of less represented genders in the management and supervisory board and preparing an action plan on how to increase the number of such individuals to reach the set target level. The Nomination Committee comprises at least three members who are elected by the Supervisory Board. As of 31.12.2025, the Nomination Committee comprised of three members and they were Rainer Rohtla (chairman), Viljar Arakas and Silver Kuus. No remuneration is paid to the members of the Nomination Committee. 4. Cooperation between the Management Board and the Supervisory Board The Management Board and the Supervisory Board cooperate closely to protect the best interests of Coop Pank. The Management Board and the Supervisory Board jointly develop Coop Pank's strategy. The Management Board is invited to attend monthly meetings of the Supervisory Board. Th e Management Board shall regularly inform the Supervisory Board of any material information regarding the bank's planning and conduct of business, operational risks and management of these risks. 5. Implementation of diversity policy In accordance with section 4 of article 24’² of the Accounting Act, a large undertaking whose securities granting voting rights have been admitted for trading on a regulated securities market of Estonia or another Contracting State shall describe in the corporate governance report the diversity policies carried out in the company's management board and senior management and the results of the implementation thereof during the accounting year. If no diversity policies have been implemented during the a ccounting year, the reasons for this should be explained in the corporate governance report. In 2025, the bank did not implement a diversity policy, as it always considers the best interests of the Group in the selection of both executives and employees, considering the candidate's education, skills and previous work experience. At the same time, the Group follows the principle of non -discrimination of candidates on the grounds of gender or other status. In 2025, a Nomination Committee was established, whose tasks include ensuring the existence of diversity principles as well as setting a target level for increasing the number of underrepresented gender and preparing an action plan for achieving it. The diversity principles will be adopted in 2026. 6. Disclosure of information Coop Pank shall treat all shareholders equally and shall notify all shareholders equally of material circumstances and from 10.12.2019 considers the rules established for listed companies by providing information. On the Investor section of Coop Pank's website all documents and information will be made available to shareholders in accordance with the Corporate Governance Recommendations. On its website, Coop Pank shall
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 33 publish a financial calendar which includes the dates of publication of the Annual Report and Interim Reports. The published information shall also be made available in English. 7. Financial reporting and audit Once every year, Coop Pank publishes the Annual Report for the previous year. The Annual Report shall be audited by an external auditor, accepted by the Supervisory Board and approved by the General Meeting. Members of the Supervisory Board do not sign the Annual Report together with the Management Board members (clause 6.1.1 of CGR). The position of the Supervisory Board on the Annual Report is included in the Supervisory Board’s written report, approved with the resolution of the Supe rvisory Board. The bank submits the Annual Report, signed by the Management Board, to the General Meeting of Shareholders (thus Coop Pank does not comply with the requirement to submit the report signed by the members of the Management and Supervisory Board to the shareholders, clause 6.1.1 of CGR). However, a proposal for approval of the Annual Report, prepared by the Supervisory Board, shall be submitted to the General Meeting. The auditor shall be appointed by the General Meeting of Shareholders, who shall also determine the auditor's remuneration arrangements. The auditor is appointed to perform a single audit or for a period specified by the General Meeting. In 2025, the auditor has provided contracted services to companies of the consolidation group, including audits of Annual Reports of Group companies and quarterly reviews and other assurance services subject to obligations under the Credit Institutions Act and the Securities Market Act. Also, the auditor has provided other services permitted pursuant to the Republic of Estonia Auditors Activities Act. In 2025, the fees paid or payable for the services provided by the auditor amounted to 230 thousand euros.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 34 Sustainability Report The basis for the preparation of the report On 5 January 2023, the Corporate Sustainability Reporting Directive (CSRD) entered into force, the purpose of which is to regulate ESG (Environmental, Social, and Governance) reporting and move towards a more sustainable economy. The reporting requirement will be implemented gradually. Coop Pank Group’s obligation to submit report prepared in accordance with the European Sustainability Reporting Standards (ESRS) in 2026 (for 2025) has been postponed by two years with the Omnibus I amendment proposal. It is important for us to be in compliance with the sustainability reporting requirements and we have already partly structured this sustainability report according to the structure and general requirements of ESRS. The sustainability report has been prepared on a consolidated basis. The scope of the consolidation is the same as the scope of the financial report. This sustainability report has not been subject to audit. Management Management and supervisory bodies The company’s management report provides an overview of the management of Coop Pank (p. 25) and the members of the Supervisory Board and the Management Board (p.19). Sustainability management Since 2017, the Coop Pank group’s biggest shareholders have been Coop Investeeringud OÜ and the member cooperatives of Coop Eesti Keskühistu (the retail chain Coop Estonia). The link between retail and banking is reflected in our joint mission statement: ‘ Driving life forward in every corner of the country’. This has exemplified our operations for the last eight years and determines a key focal point of our sustainability. Enterprising people and pristine nature are Estonia’s greatest assets. As an Estonian bank, we spur Estonian companies on every day and help people realise their dreams. We drive life forward in every corner of the country – urban and rural areas alike – by sticking together and valuing our pristine environment. Coop Bank's mission to foster life in every corner of Estonia is inherently sustainable, and sustainability topics from different angles have been a focus at Coop Bank for years. We have made the importance of sustainable operations the focus of attention of both our management and supervisory boards and also hired a full-time employee dedicated to sustainability. In 2023, we created an ESG roadmap, which we update annually and according to which we develop the Group's sustainability consistently and systematically. The Coop Pank group is increasingly environmentally aware in its own operations and follows its green office principles approved in 2021 and updated in 2025 based on the guidelines issued by the Estonian Association for Environmental Management. In issuing loans to companies, the Coop Pank group takes environmental impact into consideration and looks for opportunities to contribute to companies that reduce negative environmental impact. The Coop Pank group already joined the Responsible Business Forum in 2020 (renamed in 2025 as the Sustainable Business Estonia KELL) and participates in the Responsible Business Index survey, where it has held the gold level label since 2025. The gold leve l has been achieved gradually, starting from the bronze level. We are also an active member of the Estonian Banking Association’s committee on sustainable banking, contributing to growth in the sustainability of banking operations. From 2022 to 2024, the Group participated as the first Estonian bank in one of the world's leading environmental reporting projects, CDP (Carbon Disclosure Project). On the CDP platform we transparently
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 35 disclosed environmental data. At the first year, the Coop Pank group received the rating B -, i.e. the environmental manager level, which is assigned to companies that have demonstrated good management in the field of environmental impact. In 2023, we received the rating C, i.e. the awareness level. The rating for 2024 was D. At the same time, the volume of disclosed information and the Bank’s score increased annually, but CDP rating thresholds became stricter. Therefore, no conclusion can be drawn from the change in the Bank’s rating that we have become worse in terms of environmental reporting. We are increasingly disclosing information that overlaps with what is published in the CDP platform and making it more accessible to the wider public. Therefore, we have discontinued double reporting and, starting from 2025, will no longer participate in CDP reporting. In 2022, the Coop Pank group became a member of the financial initiative of the United Nations Environment Program (UNEP FI or United Nations Environment Program Finance Initiative) and affirmed its commitment to achieving sustainability goals. We signed the principles of responsible banking, which bring the bank's business strategy into line with the goals of the UN sustainable development and the Paris climate agreement, and increase the positive impact on society. In managing and fostering sustainable development, the group is guided by the UN’s 17 sustainable development goals (SDGs). Operating within the banking sector, we are able to contribute either directly or indirectly to the following areas of sustainable development: SDG 8 – Decent Work and Economic Growth SDG 13 – Climate Action SDG 11 – Sustainable Cities and Communities SDG 16 – Peace, Justice and Strong Institutions SDG 12 – Responsible Consumption and Production Climate Change Transition plan to mitigate climate change We have not yet developed a transition plan to mitigate climate change, but we have consistently taken steps to reduce our negative impact and increase our positive impact. In August 2021 we moved our head office into the new, more economical, less energy intensive Skyon building, which was constructed and is being maintained in accordance with the requirements of the LEED certificate. LEED (Leadership in Energy and Environme ntal Design) is one of the most prevalent green building rating systems in the world. In March 2022, the Skyon office building was awarded the LEED Platinum certificate, which is the highest level. We have introduced the paper-free management of documents in our everyday work: we enter into agreements with our clients and partners electronically and allow clients to join the bank via a simple online solution that was used by 61.4% of our new clients in 2025 (compared to 58.6% in 2024). In the first half of 2024, the Bank launched a pilot project under which we implemented paperless document management in our customer offices. The pilot project has proven successful, and document management in our offi ces is now primarily paperless. In 2022, we signed a cooperation agreement with the technology recycling company GreenDice, which deals with the organisation of the technical circulation of IT equipment and directing it to recycling. The GreenDice recycling system helps to valorise our u sed IT equipment by finding new users for them or directing unusable equipment to be recycled as raw materials. The usage journey of the devices is fully traceable throughout their entire life cycle. We consider the safe and traceable journey of equipment and the positive social impact that the circulation of our used IT equipment offers to be very important. In 2023, GreenDice directed our equipment (18 desktops and 18 monitors donated) to a school's computer lab and a youth center. In 2024, we donated 135 pieces of equipment, to be given a new life, including to the NGO Women’s Support and Information Center. In 2025, we handed over 173 devices.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 36 In 2025, we continued to finance the construction of solar parks and wind turbines, reaching a nominal capacity of 81.3 MW by the end of the year. Financing solar and wind parks accounts for about 3.8% of the portfolio of our corporate financing business line. We continue to contribute to making residential buildings more energy- efficient and also offer more favorable conditions for purchasing properties with a higher energy class. In 2023, we signed an agreement with the European Energy Efficiency Fund (EEEF) to raise 15 million euros, and in 2025 for 5 million euros, for the purpose of financing energy efficiency and renewable energy projects. In 2024, we financed 5 projects via EE EF and in 2025, one additional project was added. The European Bank for Reconstruction and Development invested €20 million last year in Coop Pank covered bonds to support green financing. The European Investment Bank Group and Coop Pank concluded a securi tization transaction under which the Bank can offer up to €249 million in new loans, of which at least €49 million is allocated for promoting gender equality and at least €17 million for projects related to climate action and environmental sustainability. Management of Impacts, Risks, and Opportunities In 2024, we conducted a double materiality assessment forming the basis of CSRD sustainability reporting and a UNEP FI impact analysis at Coop Bank simultaneously. The goal of the double materiality assessment was to identify significant impacts, risks, and opportunities. The double materiality assessment was carried out in accordance with the requirements of the ESRS 1 standard and the recommendations of the EFRAG guidelines (the organization responsible for developing sustainability reporting standards). The results were confirmed in January 2025. Four sustainability aspects were assessed as material: Climate Change (E1) Own Workforce (S1) Consumers and End-users (S4) Business Ethics (G1) Under the climate change sustainability aspect, one risk and two opportunities were also assessed as material. The UNEP FI impact analysis focused on identifying the Bank’s most significant positive and negative impacts. As a result of the UNEP FI impact analysis, we identified SDG 8 (Decent Work and Economic Growth) as a positive impact area and SDG 13 (Climate Action) as a negative impact area. Policies, measures, and objectives related to climate change mitigation and adaptation The chapter on sustainability management (p. 34) briefly explains the existing policies. Indicators and objectives To manage climate-related impacts and risks, we have not yet set targets for reducing greenhouse gases, but we have consistently measured our footprint and made efforts to become more precise in measuring our footprint and assessing the climate impact of our loan portfolio. Our climate impact The carbon footprint of the Coop Bank group in 2025 was a total of 212,758 tons of CO₂ equivalent (248,855 in 2024), of which 99.7% (99.8% in 2024) was the impact from the financed emissions (portfolio and leasing) and 0.3% (0.2% in 2024) was impact related to office activities. We have assessed our climate impact since 2021. To calculate the carbon footprint emission intensity per employee, the office activity carbon footprint was divided by the Group’s average number of employees in the previous year (adjusted to full -time equivalents). For calculating emission intensity per net income, net income was used, which corresponds to the net income presented in the Note 4 Operating segments, together with the Bank’s total greenhouse gas emissions.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 37 Emission Intensity 2025 2024 Greenhouse Gas (Office Activities) Emission Intensity per Employee (t CO₂e/FTE) 1.43 1.27 Greenhouse Gas emission intensity (office operations + financed emissions) per net income (t CO₂e/meur) 2,680 3,039 Climate impact from office operations The climate impact of office operations has been calculated in accordance with the internationally recognized and most widely used greenhouse gas reporting standard, the GHG Protocol (GHG Protocol Corporate Accounting and Reporting Standard). This standard divides emissions into three scopes: • Scope 1 refers to direct emissions from sources owned or controlled by the Bank. • Scope 2 refers to indirect emissions resulting from the consumption of purchased electricity, heating, and cooling energy by the Bank. • Scope 3 consists of 15 different categories across the Bank’s entire value chain (including Category 15 – investments, which are separately disclosed in the section ‘Financed Emissions’). The assessment of the climate impact from office operations is based on the principle of operational control and uses consumption-based data. To evaluate the impact of employee commuting between home and work, as well as home office activities, an annual survey is conducted among employees. Greenhouse gas emissions (t CO₂e) 2025 2024 Scope 1 emissions 30 37 Scope 2 emissions 129 163 Scope 3 emissions 212,600 248,655 1 Purchased goods and services 25 26 2 Capital goods 219 86 3 Fuel- and energy-related activities 36 60 4 Upstream transportation and distribution - - 5 Waste generated in operations 15 1 6 Business travel 26 35 7 Employee commuting 166 144 8 Upstream leased assets - - 9 Downstream transportation and distribution - - 10 Processing of sold products - - 11 Use of sold products - - 12 End-of-life treatment of sold products - - 13 Downstream leased assets* 25,544 33,183 14 Franchises - - 15 Investments (financed emissions) 212,113 248,304 Total 212,758 248,855 Of which office operations emissions 645 551 Of which financed emissions 212,113 248,304 * Under leased assets, we report emissions from the leasing portfolio.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 38 Energy Consumption Energy consumption represents a significant share of the office operations carbon footprint. Therefore, we disclose in the table below consumption-based information on the amount and type of energy used. Energy Consumption (MWh) 2025 2024 Renewable electricity (MWh) 389 390 Non-renewable electricity (MWh) 176 181 Heating (MWh) 369 379 Total energy consumption (MWh) 934 950 Financed emissions Since 2021, we have performed an assessment of the carbon footprint of our organization and of loan portfolio (financed emissions) in accordance with the GHG Protocol. The climate impact of the Coop Pank group's portfolio is calculated based on the standar d "The Global GHG Accounting & Reporting Standard for the Financial Industry" of the Partnership for Carbon Accounting Financial (PCAF). The PCAF standard is the only sector-specific standard that allows financial institutions to estimate and disclose gree nhouse gas emissions from loans and investments. The PCAF standard is in line with the GHG Protocol standard and complements the GHG Protocol Corporate Value Chain (scope 3) standard with detailed additional guidance for each asset class. Using the PCAF methodology, Coop Bank assesses financed emissions across seven asset classes: sovereign bonds (from 2025), listed equity and corporate bonds (from 2025), leases, business loans, commercial real estate, renewable energy projects, and residential real estate. For the asset classes , sovereign bonds and liste d equity and corporate bonds, we have assessed 100% of the assets in these classes in accordance with the PCAF methodology. The assessed volume primarily depends on data availability and quality, which means it is not possible to assess all asset classes at 100% coverage. A PCAF data quality score of 1 represents an estimate with the most accurate data quality, and a score of 5 represents an estimate with the lowest data quality. When evaluating the impact of the Group's portfolio in 2021, methodologies corresponding to sco res 4 and 5 were used, depending on the availability of data. In assessing the impact of the loan portfolio in 2022, the data quality score was improved, and the new average score was 3.7. In 2023, the new average score was 3.2 and in 2024, 3.1. In 2025, the data quality score was 3.5. Financed emissions by asset class The loan portfolio is assessed on the principle of financial control, and leases are assessed on the principle of operational control. For the sovereign bonds asset class, Scope 1 has been assessed both including and excluding the LULUCF sector (Land Use, Land-Use Change, and Forestry). For the asset classes leases, renewable energy projects, commercial real estate, and residential real estate, Scopes 1 and 2 have been assessed. For listed equity and corporate bonds as well as business loans, all three scop es have been assessed. Within the residential real estate asset class, in addition to the purchase and refinancing of residential property, construction and renovation have also been considered, which under the standard may be assessed as zero emissions. As a result, the emissions for this asset class may be considered overstated, since construction and renovation emissions are in our case attributed to the Bank. Based on the GHG Protocol, leases are classified in the scope 3 category of "leased assets", therefore the impact of leases is typically not included as part of the Group’s loan portfolio climate impact. Since the impact of leasing has been significant amo ng all the Group's emissions, the impact resulting from leasing was included in the table for comparison with other asset classes. Regarding leasing, we support reuse, for instance, the majority of our car leasing sales in 2025 were second-hand cars (78% in 2025 compared to ca 81% in 2024).
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 39 Asset class Outstanding amount, MEUR Scope 1+2, tCO2e Scope 3, tCO2e Emission intensity, tCO2e/ MEUR Measured % of contracts PCAF score 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 Sovereign bonds 48.95 0 7,597 0 0 0 155 0 100 0 1 0 Sovereign bonds (+ LULUCF) 48.95 0 7,276 0 0 0 149 0 100 0 1 0 Listed equity and corporate bonds 14.24 0 47 0 438 0 34 0 100 0 4 0 Leasing 166.88 175.39 25,544 33,183 0 0 153 189 99.89 100 1 1.69 Business loans 968.58 250.97 47,091 21,941 81,887 110,953 133 530 80.17 98.9 4 4.00 Renewable energy projects (avoided emissions) 46.6 49.8 92,975 73,907 0 0 1,995 1,484 99.5 94.1 2.9 2.87 Commercial real estate 397.59 383.64 24,645 40,603 0 0 61.98 106 97.49 100 3 3.63 Residential real estate 669.95 542.63 25,186 41,624 0 0 37.6 77 99.49 100 3 3.53 For renewable energy projects, the avoided emissions have been assessed, meaning the greenhouse gas emissions that do not occur because an environmentally friendlier solution created by the renewable energy project is used instead of a conventional alterna tive. Avoided emissions are not counted as a reduction in the Group’s total emissions. Renewable energy projects (avoided emissions) Outstanding amount, MEUR Avoided emissions, tCO2e Emission intensity, tCO2e/ MEUR Measured % of contracts, % PCAF score 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 Solar 34.1 36.1 56,731 64,760 1,665.65 1,793.42 99.65 100 3 3 Wind 6.97 5.52 34,214 6,897 4,907.85 1,248.45 100 100 3 3 Bioenergy 5.61 8.2 2,029 2,029 361.17 247.9 97.71 74.67 2 2 Since 2021, we have improved the data quality score, but we still face a major challenge in enhancing the availability and quality of data for measuring the climate impact of the loan portfolio. The higher the data quality score, the more accurate and reliable the results of climate impact assessment. We have not established a base year for the assessment of our financed emissions. This is due to the limited availability and uneven quality of data, as well as the fact that we are still refining the assessment processes, which means the results would not be comparable to a base year. In the longer term, we plan to set a base year and adopt a baseline data recalculation protocol to define the circumstances under which recalculation of financed emissions for the base year is necessary, ensuring consistency, comparability, and relevance of financed emissions data reported over time. For these reasons, the comparative figures presented in the tables are not strictly comparable with the previous year’s data. Consumers and end-users It is important to us that vital products and services are accessible to everyone close to their homes. As an Estonian bank, we bring everyday banking services closer to people so that everyone can enjoy life wherever they want to live. For instance, cash services are available at people’s local stores: Coop Pank group clients can make deposits and withdrawals from their accounts at more than 320 Coop stores around the country. We are pleased to see that more people are making use of these services all the time, as can be seen in the table below:
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 40 2025 2024 COOP cash transactions vs ATMs (proportion of total number of transactions) 40.7% 39.5% COOP cash transactions vs ATMs (proportion of total turnover) 37.9% 35.4% We also serve clients at 16 branches in 13 towns, making ours one of the biggest networks of bank branches in Estonia. Our client relationships outside of Tallinn/Harju County can be summarised as follows: 2025 2024 Everyday banking 63.3% 63.0% Mortgage loans 38.9% 37.8% Business loans 36.5% 33.6% Leasing 44.8% 44.1% We contribute to improving the financial literacy of the Estonian population by advising people of all ages on how to make smarter choices regarding their finances via our Lihtsalt rahast (‘Money Matters Put Simply’) podcast and through other channels. We promote saving for retirement and its importance with Tuleva pension funds. We regularly participate in the working groups of the Estonian Banking Association, including the financial literacy working group. We also actively contribute to anti -fraud initiatives both through the Banking Association and independently to help protect the assets of Estonian residents. The development of products and services in line with responsibility and sustainability objectives is an ongoing process. The Coop Pank group decided some time ago that it would not offer financing for: - the organisation of gambling and betting activities; - the manufacturing of tobacco; - entertainment events; - exports to countries subject to sanctions; - aircraft, ships and railway stock; - the weapons industry or arms trade which is not linked to Estonian national defence or NATO or - political parties and other political organisations. As at the end of 2025, our loan portfolio included no loans in any of these areas of activity. Nor do we offer credit services in areas or to companies whose activities are unethical or linked to corruption, violate human rights or have a significant negative impact on the envir onment. Customers whose activities have an environmental impact are checked in each specific case to ensure that they comply with the applicable environmental protection standards in their activities. In the pricing of bank services, we are honest and transparent, and in the marketing of services we are guided by principles of responsibility. We observe all the requirements of the Money Laundering and Terrorist Financing Prevention Act. To get to know our clients, we ask them to provid e us with detailed information and we monitor their activities, all while observing the requirements of the Personal Data Protection Act. We are guided in our protection of personal data by the principle of integrated data protection, wherein we apply data protection throughout the data -processing life cycle and use only as much data as we need to offer quality banking services. Professional Conduct Professional Conduct and Business Culture. We consider our management culture to be open and modern, the basis of which is that we are guided by regulations and international standards (such as human rights, labour law and the fight against discrimination).
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 41 In our operations we are led by best practices in company management and banking, the principles of responsible lending, other guidelines issued by financial supervision authorities and valid legal acts. The fields of the prevention of money laundering and terrorist financing and the implementation of international sanctions are important to us, and we apply the necessary due diligence measures. We also monitor our marketing activities to ensure that they are in line with the valid norms. To guarantee ethical behaviour, we have established guidelines for reporting inappropriate behaviour, in accordance with which employees can inform of potential breaches of ethical norms or laws within the group. We have adopted a procedure for informing of breaches and, in cooperation with a law office, ensure the maximum possible protection for employees who wish to retain their anonymity when passing on information. In our view this lays the groundwork in the best possible way for every employee to be able to inform of any breach pertaining to internal management without having to worry that doing so may affect their working relationship with the company. To us it is only natural to offer our employees a contemporary working environment, motivating salaries, flexible hours, the option to work remotely, stimulating professional challenges, every opportunity for development and a friendly team that sticks together. We are linked by our shared values. In 2022, we started offering our employees the option of health insurance in addition to sports compensation.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 42 Remuneration report Coop Pank group applies a single remuneration policy that has been approved by the Supervisory Board of the bank and the effectiveness, adherence to objectives and implementation of the policy is supervised by the Remuneration Committee. In 2025, three Remuneration Committee meetings took place. The remuneration policy applies equally to all employees of the Group. The compensation structure applicable in the Coop Pank group is comprised of two components: ● basic salary which is fixed pay agreed between the employee and employer within a contract; ● variable pay, which is an additional pay based on the employer’s resolution (sales bonus, performance pay, stock option). Sales bonuses are paid to employees based on achieving monthly or quarterly goals. Performance pay is paid out the following period to employees whose contribution led to the results achieved while adhering to the Group's objectives and values. Performance pay supports efficient risk management and does not encourage taking excessive risks. The amount of pay is determined by the extent of reaching activity goals. The basic salary and performance pay are reasonably balanced. The following is an overview of the average gross monthly remuneration of employees for the last five years, taking into account the basic salary and monetary performance pay for the previous calendar year. For comparison, the profit before corporate income tax per employee for the respective year is presented. In euros (rounded down to the hundred) 2021 2022 2023 2024 2025 Average monthly gross remuneration 2,800 3,000 3,400 3,600 3,900 Yearly profit before income tax per employee 47,000 63,300 110,500 83,600 75,900 As at 31.12.2025, a total of 2,731,500 options were granted to employees with a maturity date of three years starting from the moment of the issue. In April 2022, a three-year share option program was confirmed by the shareholders, which allows the issuing of options to employees every year making up to 1% of the total number of shares of the bank. Based on the new share option program the share optio ns issuing can take place between April 2023 and April 2025 based on the Supervisory Board’s decision. In April 2025, the General Meeting approved a new two -year share option program of the Bank for the period of 2025 – 2026, under which options for up to 1% of the Bank's shares may be issued to employees annually. Under this program, options may be issued in period between April 2025 and April 2026 in accordance the decision of the Supervisory Board. The purpose of the share options programmes is to align long-term interests and goals of Management Board members and employees treated as such with long -term interests of the bank’s shareholders. The common interests are expressed in the professional and balanced management of the Group, which ensures the sustainable development and long -term growth of the Group in accordance with the set goals and strategy. The options are issued based both on the results of the Group and results of the person entitled to participate in the option programme in the relevant year. Options can be reduced or cancelled if the employment
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 43 relationship is terminated, the person does not meet the performance criteria, the financial results of the group have significantly deteriorated or the risks of the group are not sufficiently covered by own funds. The total amount of performance bonuses are decided by the Supervisory Board, which also determines the specific amounts of bonuses for members of the Management Board and the internal audit unit. Bonuses for other employees are decided by the Management Board. The establishm ent of the option programme and its conditions shall be decided by the general meeting of shareholders. The issuance of specific options is decided by the Supervisory Board on the proposal of the Remuneration Committee. The ratio between performance pay (including value of options granted) and basic salary of the senior management and senior staff responsible for material business units and for management of specific risk categories in 2025 was: • senior management – 38%; • staff managing control functions – 16%. The performance fees and options assigned to the Management Board are in accordance with the remuneration principles and are based on accomplishment of the general objectives of the Bank as well as on the accomplishment of the personal goals of each member of the Management Bo ard. No exceptions have been made for the members of the Management Board and no extraordinary bonuses have been granted. The right to reclaim cash performance fees has not been exercised, but options have been revoked upon the departure of a member of the Management Board. The following is an overview of the five-year remuneration of the members of the Management Board, in euros. Heikko Mäe (since Feb 2020) 2021 2022 2023 2024 2025 Basic salary 84,000 93,000 116,000 136,000 156,068 Performance pay 17,500 21,000 24,000 30,000 24,000 Value of options granted 58,282 63,077 71,966 58,544 92,714 Total remuneration 159,782 177,077 211,966 224,544 272,782 Share of performance pay 47% 47% 45% 39% 43% Number of options issued 70,000 40,800 47,900 86,200 83,500 Paavo Truu (since Feb 2022) 2021 2022 2023 2024 2025 Basic salary 0 66,971 114,000 136,000 148,000 Performance pay 0 0 21,000 30,000 24,000 Value of options granted 0 35,094 62,952 58,544 92,714 Total remuneration 0 102,065 197,952 224,544 264,714 Share of performance pay - 34% 42% 39% 44% Number of options issued 0 22,700 41,900 86,200 83,500 Arko Kurtmann (since Nov 2020) 2021 2022 2023 2024 2025 Basic salary 96,000 96,610 108,000 136,000 161,205 Performance pay 0 24,000 24,000 30,000 24,000 Value of options granted 33,304 72,044 71,966 58,544 92,714 Total remuneration 129,304 192,654 203,966 224,544 277,919 Share of performance pay 26% 50% 47% 39% 42% Number of options issued 40,000 46,600 47,900 86,200 83,500
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 44 Karel Parve (since Nov 2023) 2021 2022 2023 2024 2025 Basic salary 0 0 20,000 120,000 140,000 Performance pay 0 0 0 0 20,000 Value of options granted 0 0 0 29,136 77,280 Total remuneration 0 0 20,000 149,136 237,280 Share of performance pay - - 0% 20% 41% Number of options issued 0 0 0 42,900 69,600 Lehar Kütt (since Sep 2025) 2021 2022 2023 2024 2025 Basic salary 0 0 0 0 47,159 Performance pay 0 0 0 0 0 Value of options granted 0 0 0 0 0 Total remuneration 0 0 0 0 47,159 Share of performance pay - - - - 0% Number of options issued 0 0 0 0 0 Rasmus Heinla (until Oct 2023) 2021 2022 2023 2024 2025 Basic salary 84,000 93,000 96,000 0 0 Performance pay 12,500 21,000 32,000 0 0 Value of options granted 58,282 63,077 0 0 0 Total remuneration 154,782 177,077 128,000 0 0 Share of performance pay 46% 47% 25% 0% 0% Number of options issued 70,000 40,800 0 0 0 Kerli Lõhmus (until Jan 2022) 2021 2022 2023 2024 2025 Basic salary 84,000 12,348 0 0 0 Performance pay 21,000 21,000 0 0 0 Value of options granted 58,282 0 0 0 0 Total remuneration 163,282 33,348 0 0 0 Share of performance pay 49% 63% - - 0 Number of options issued 70,000 0 0 0 0 Hans Pajoma (until Oct 2020) 2021 2022 2023 2024 2025 Basic salary 0 0 0 0 0 Performance pay 13,500 0 0 0 0 Value of options granted 0 0 0 0 0 Total remuneration 13,500 0 0 0 0 Share of performance pay 100% - - - 0 Number of options issued 0 0 0 0 0 Margus Rink (until May 2025) 2021 2022 2023 2024 2025 Basic salary 126,000 139,500 156,000 184,000 202,341 Performance pay 31,500 31,500 36,000 42,000 32,000 Value of options granted 74,934 94,615 108,024 82,043 123,581 Total remuneration 232,434 265,615 300,024 308,043 357,922 Share of performance pay 46% 47% 48% 40% 43% Number of options issued 90,000 61,200 71,900 120,800 111,300
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 45 Consolidated Financial Statements Consolidated Statement of Profit or Loss and Other Comprehensive Income in thousands of euros Note 2025 2024 Interest income calculated using the effective interest method 115,341 125,338 Other income similar to interest 11,003 13,357 Interest and similar expense -53,075 -61,125 Net interest and similar income 5 73,269 77,570 Fee and commission income 8,358 7,899 Fee and commission expense -3,813 -3,541 Net fee and commission income 6 4,545 4,358 Change in fair value of investment properties 0 -750 Net gains from non-financial asset realisation 0 53 Net gains from financial assets measured at fair value through other comprehensive income 251 33 Handling of overdue receivables 637 534 Other income 654 85 Net other income 1,542 -45 Payroll expenses 7 -24,406 -23,411 Operating expenses 8 -10,830 -11,713 Depreciation 13 -6,255 -5,452 Total operating expenses -41,491 -40,576 Profit before loss allowances and tax 37,865 41,307 Credit loss allowance 11 -3,299 -4,643 Profit before tax 34,566 36,664 Income tax expense 25 -5,842 -4,486 Net profit for the financial year 4 28,724 32,178 Other comprehensive income / loss (-) Items that may be reclassified subsequently to profit or loss: Financial assets at fair value through other comprehensive income -402 757 Other comprehensive income/ loss (-) -402 757 Total comprehensive income for the financial year 28,322 32,935 Basic earnings per share (in euros) 24 0.28 0.31 Diluted earnings per share (in euros) 24 0.27 0.31 Notes to the financial statements on pages 49 to 124 are an integral part of the consolidated financial statements.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 46 Consolidated Statement of Financial Position in thousands of euros Note 31.12.2025 31.12.2024 (Restated) Assets Cash and cash equivalents 9 469,732 325,362 Mandatory reserve kept in the Central Bank 9 18,985 18,316 Debt securities at fair value through other comprehensive income 10 58,035 37,751 Debt securities at amortized cost 10 4,988 0 Equity instruments at fair value through other comprehensive income 10 13 13 Loans and advances to customers 11 2,114,091 1,774,118 Derivatives 2 3,681 0 Other financial assets 12 741 1,610 Other assets 12 1,718 2,035 Assets held for sale 12 1,256 1,140 Right-of-use assets 13 4,736 5,107 Tangible assets 13 3,539 3,451 Intangible assets 13 14,722 12,954 Goodwill 3 6,757 6,757 Total assets 2,702,994 2,188,614 Liabilities Customer deposits* 15 2,047,459 1,877,865 Loans received* 16 77,061 8,280 Debt securities 17 255,203 0 Lease liabilities 14 4,766 5,153 Other financial liabilities 18 13,230 15,443 Other liabilities 18 7,584 7,088 Subordinated debt 19 63,148 63,148 Total liabilities 2,468,451 1,976,977 Shareholders' equity 20 Share capital 70,638 70,181 Share premium 28,133 26,711 Statutory reserve capital 8,424 6,815 Retained earnings 125,713 105,807 Other reserves and assets revaluations 1,635 2,123 Total shareholder’s equity 234,543 211,637 Total liabilities and shareholders’ equity 2,702,994 2,188,614 * In 2025, the Group decided to separately present Loans received, which were previously aggregated within Customer deposits and loans received, due to their increased balance. As of 1 January 2024, Loans received would have been 9,682 thousand euros out of the previously presented Customer deposits and loans received of 1,721,765 thousand euros. Notes to the financial statements on pages 49 to 124 are an integral part of the consolidated financial statements.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 47 Consolidated Statement of Cash Flows in thousands of euros Note 2025 2024 (Restated) Cash flows from operating activities Interest and other similar income received 122,703 138,367 Interest paid -50,245 -64,341 Fees and commissions received 8,358 7,899 Fees and commissions paid -3,813 -3,541 Other received income 1,293 706 Salaries paid -24,829 -22,555 Other operating expenses paid -10,830 -11,576 Advance Income Tax paid 25 -5,494 -5,809 Total cash flows from operating activities before changes in operating assets and liabilities 37,143 39,150 Change in operating assets: Loans and advances to customers -343,217 -287,578 Change of base level of the reserve kept in the Central Bank 9 -669 -1,218 Other assets 1,071 -1,852 Change in operating liabilities: Change in customer deposits* 172,885 169,205 Change in loans received* 68,781 -1,402 Other liabilities -1,727 929 Net cash flows from operating activities -65,733 -82,766 Cash flows from investing activities Acquisition of tangible and intangible assets 13 -7,359 -6,636 Sale of tangible and intangible asset and assets held for sale 2 634 Acquisition of debt securities 10 -40,010 -2,342 Sale and redemption of debt securities 10 15,210 1,253 Total cash flows used in investing activities -32,157 -7,091 Cash flows from financing activities Paid in share capital 20 842 820 Issue of subordinated debt 19 0 15,000 Redemption of subordinated bonds 19 0 -2,000 Dividends paid 20 -7,209 -8,895 Debt securities 17 249,235 0 Repayment of lease liabilities 14 -606 -961 Total cash flows from financing activities 242,262 3,964 Effect on exchange rate changes on cash and cash equivalents -2 -1 Change in cash and cash equivalents 144,370 -85,894 Cash and cash equivalents at beginning of the period 325,362 411,256 Cash and cash equivalents at the end of the period 469,732 325,362 Cash and cash equivalents balance is comprised of: 469,732 325,362 Cash on hand 4,288 1,766 Demand deposits at the Central Bank 9 443,316 299,380 Demand and short-term deposits in credit institutions and other financial institutions 22,128 24,216 * Change in loans received and Change in customer deposits were presented together in the consolidated statements of cash flows for 2024 in the amount of 167,803 thousand euros. Notes to the financial statements on pages 49 to 124 are an integral part of the consolidated financial statements.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 48 Consolidated Statement of Changes in Equity in thousands of euros Share capital Share premium Statutory reserve capital Other reserves Revaluation reserve Retained earnings Total shareholde r’s equity Equity as at 31.12.2023 69,673 25,779 4,855 1,493 -459 84,484 185,825 Paid in share capital 508 932 0 -620 0 0 820 Dividends paid 0 0 0 0 0 -8,895 -8,895 Changes in statutory reserve capital 0 0 1,960 0 0 -1,960 0 Share options * 0 0 0 952 0 0 952 Net profit 0 0 0 0 0 32,178 32,178 Other comprehensive income 0 0 0 0 757 0 757 Total comprehensive income 0 0 0 0 757 32,178 32,935 Equity as at 31.12.2024 70,181 26,711 6,815 1,825 298 105,807 211,637 Paid in share capital 457 1,422 0 -1,037 0 0 842 Dividends paid 0 0 0 0 0 -7,209 -7,209 Changes in statutory reserve capital 0 0 1,609 0 0 -1,609 0 Share options * 0 0 0 951 0 0 951 Net profit 0 0 0 0 0 28,724 28,724 Other comprehensive income 0 0 0 0 -402 0 -402 Total comprehensive income 0 0 0 0 -402 28,724 28,322 Equity as at 31.12.2025 70,638 28,133 8,424 1,739 -104 125,713 234,543 *See Note 20 Notes to the financial statements on pages 49 to 124 are an integral part of the consolidated financial statements.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 49 Notes to Consolidated Financial Statements Note 1 Material accounting policy information Coop Pank AS (Reg. No. 10237832) is a credit institution registered in Tallinn (Estonia) Maakri street 30. The consolidated annual report (incl. consolidated financial statements) of Coop Pank group for the year 2025, which have been prepared on a going co ncern basis, was confirmed by the Management Board of Coop Pank on 10 March 2026 and approved by the Supervisory Board on 11 March 2026. The authorised for issue consolidated annual report is subject to approval by the shareholders on 08 April 2026. Functional and presentation currency The functional currency of the Coop Pank group companies is euro. 2025 consolidated financial statements have been presented in thousands of euros, unless stated otherwise. 1.1 Basis of preparation These consolidated financial statements of Coop Pank group are prepared in accordance with International Financial Reporting Standards (IFRS Accounting Standards) as adopted by the European Union. The material accounting policy information and significant accounting estimates and judgements applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. These financial statements have been prepared under the historical cost convention, except as disclosed in some of the accounting policies below (i.e. Debt securities and equity instruments at fair value through other comprehensive income and derivatives at fair value hedge). Financial statements have been prepared according to the accrual principle of accounting. The Group classifies its expenses by nature of the expense method. When the presentation or classification of items in the consolidated financial statements is ame nded, comparat ive information for the previous period is also reclassified, if not referred differently in the specific accounting principle. 1.2 Critical accounting estimates and judgements The preparation of the consolidated financial statements in accordance with the International Financial Reporting Standards as adopted by the EU requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the reporting period. Although these estimates are based on the best knowledge and judgement of current events and actions, the actual outcome and the results ultimately may significantly differ from those estimates. A more detailed overview of the estimates made is provided under the accounting principles or disclosures set out below. Critical estimates are primarily used in the following areas: ● expected credit loss, incl. fair value assessments of collateral (Note 2; Note 11, 12); ● fair value of financial assets and liabilities (Note 2); ● goodwill impairment (Note 3). The most significant management judgements are related to the application of the IFRS 9 standard. Management has assessed the business model for classifying different financial assets. The commercial purpose of loans to customers as well as debt securities at amortized cost is the collection of contractual cash
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 50 flows, while loans and debt securities under this model may also be sold for credit risk mitigation purposes. Financial investments in debt instruments are made for the purpose of investing liquid assets, which is why the commercial purpose of investing in debt instruments is to collect and sell contractual cash flows as needed. In addition, it has been assessed whether the contractual cash flows only include the principal and interest payments, including interest cash flows for the time value of money, cre dit risk, liquidity risk and, inter alia, cover administrative costs and profit margin. All recognised financial assets meet these criteria. Management also estimates the expected inputs of the expected credit loss model for financial assets. Models, estimates, and inputs are reviewed regularly by the Group Risk Management function. Estimates and judgments of the management are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under these circumstances. Changes in assumptions may have a significant impact on the financial statements in the period assumptions are changed. Management believes that the underlying assumptions are appropriate, and the Group's financial statements therefore present the financial position and results fairly. 1.3 Consolidation These consolidated financial statements of the Coop Pank group are comprised as at 31.12.2025. The group’s entities use uniform accounting policies. The definition of group according to the Regulation (EU) No 575/2013 of the European Parliament and of the Council matches that under IFRS Accounting Standards. The statements of financial position and stat ement of profit or loss and other comprehensive income of the bank and its subsidiaries are consolidated on a line-by-line basis, eliminating the intercompany balances, revenues, income, expenses and unrealised gains/losses on transactions between group companies. Structure of the Group Country Activity Holding Coop Pank AS Estonia banking parent company Coop Liising AS Estonia leasing 100% Coop Kindlustusmaakler AS Estonia insurance brokerage 100% SIA Prana Property Latvia real estate management 100% Subsidiaries Subsidiaries are consolidated in the financial statements from the time control arises until it ceases. In the parent company’s separate financial statements investments in subsidiaries are accounted for at cost less any impairment recognised. 1.4. Foreign currency transactions and assets and liabilities denominated in a foreign currency All other currencies except for the functional currency, the euro, constitute foreign currencies. Foreign currency transactions have been translated to functional currencies based on the foreign currency exchange official rates of the European Central Bank prevailin g on the transaction date. Monetary assets and liabilities denominated in a foreign currency have been translated into the functional currency based on the foreign currency exchange rates of the European Central Bank prevailing on the balance she et date. Foreign exchange gains and losses are recognised in the statement of profit or loss as income or expense of that period. Non -monetary financial assets and liabilities denominated in a foreign currency measured at fair value have been translated in to the functional currency based on the foreign currency exchange rates of the European Central Bank prevailing on the fair value measurement date. Non-monetary assets and liabilities that are not measured at fair value (e.g. prepayments, inventories accounted for using the cost method, tangible assets as well as intangible assets) in
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 51 a foreign currency are not translated at the balance sheet date but they continue to be reported using the official exchange rate of the European Central Bank prevailing at the date of the transaction. 1.5. Financial assets Classification The Group classifies its financial assets in the following measurement categories: ● those to be measured subsequently at fair value (either through OCI or through profit or loss) and ● those to be measured at amortised cost. The classification depends on the Group’s business model for managing the financial assets and the contractual terms of the cash flows. The classification made can be seen in the table below: Measurement category as defined by IFRS9 Financial assets category as defined by the Group Balances with central banks Demand and term deposits at credit institutions and other financial institutions Receivables from private individuals incl. consumers loans incl. lease financing Financial assets measured at amortised cost (AC) incl. mortgage loans and other loans Loans and advances to customers Receivables from legal entities incl. lease financing incl. other loans Debt securities at amortised cost Other financial assets Financial assets at fair value through profit or loss (FV) Derivatives Investments in equity instruments Financial assets measured at fair value through other comprehensive income (FVOCI) Investments in debt securities Investments in equity instruments Recognition and derecognition Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Group commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership. Measurement At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 52 Debt instruments Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset (i.e. whether the Group’s objective is solely to collect the contractual cash flows from the assets, or to collect both the contractual cash flows and also the cash flows from th e sale of assets; or is none of the above described two models) and the cash flow characteristics of the asset (i.e. whether the cash flows represent solely payments of principal and interest (“SPPI”), interest including only consideration for credit risk, time value of money, other basic lending risks and profit margin). Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are SPPI. The Group’s debt instruments have been classified into the following measurement categories: ● Amortised cost (AC): Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interests are measured at amortised cost. Interest income from these financial assets is included in interest income using the e ffective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in other income/(expenses). Impairment losses are presented as separate line items in the statement of profit or loss. The following financial assets of the Group are classified in this category: o Cash; o Balances with central banks; o Demand deposits at credit institutions and other financial institutions; o Loans and advances to customers; o Investments in debt securities; o Other financial assets. ● FVOCI: Assets that are held for collection of contractual cash flows and for selling financial assets where the assets’ cash flows represent solely payments of principal and interest are measured at FVOCI. Movements in the carrying amount are taken through OCI, e xcept for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in profit or loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised under “net gains from financia l assets measured at fair value through other comprehensive income ”. Interest income from these financial assets is included in interest income using the effective interest rate method. Impairment losses are presented as separate line items in the statement of profit or loss. The following financial assets of the Group are measured FVOCI: o Investments in debt securities. Equity instruments The Group subsequently measures equity investments that are listed at FVPL and equity investments that are not listed at FVOCI. Derivatives and hedge accounting The Group applies hedge accounting according to IFRS 9 Financial instruments to fair value hedges of covered bond presented as Issued debt securities . Coop Pank enters into interest rate swaps to hedge interest risk at Debt securities issued. A hedging relationship qualifies for hedge accounting if it meets all of the following effectiveness requirements according to IFRS 9 p. 6.4.1:
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 53 • Economic relationship: There is an expectation that the values of the hedged item and hedging instrument will move in opposite directions in response to the same risk. • Credit risk impact: The change in value of the hedging relationship is not dominated by the effect of credit risk. • Hedge ratio: The designated ratio of the hedging relationship is the same as that used for actual risk management purposes. For the fair value hedge relationship that continues to meet the hedge effectiveness requirements, the following accounting rules are applied: • The gain or loss from changes in fair value of the hedging instrument is recognized in profit or loss. • The gain or loss on the on the hedged item attributable to the hedged risk (FVH ‘basis adjustment’) is recognized in profit or loss and in the Statement of Financial Position as a corresponding adjustment to the carrying amount of the hedged item, within Issued debt securities. • The net interest accruals on the hedging instrument are recognized in profit or loss, within Interest and similar expense. • The carrying amount of the hedging instrument is recognized in balance sheet, within Derivative financial assets with a positive fair value (above zero) or within Derivative financial liabilities with a negative fair value (below zero). Impairment of financial assets The Group assesses on a forward -looking basis the expected credit losses (ECL) associated with its debt instruments carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. The measurement of ECL reflects: (i) an unbiased and probability weighted amount that is determined by evaluating a range of possible outcomes, (ii) time value of money and (iii) all reasonable and supportable information that is available without undue cost and effort at th e end of each reporting period about past events, current conditions and forecasts of future conditions. For trade receivables and contract assets without a significant financing component the Group applies a simplified approach permitted by IFRS 9 and measures the allowance for impairment losses at expected lifetime credit losses from initial recognition of the receivables. The Group uses a provision matrix in which allowance for impairment losses is calculated for trade receivables falling into different ageing or overdue periods. For all other debt instruments, including finance lease receivables, at amortised cost or FVOCI, the Group follows a three - stage model based on changes in credit quality since initial recognition. A more detailed overview of the three -stage model principles is given in Note 2 "Risk mana gement" in part “Measurement of expected credit loss (ECL) ". Debt instruments measured at AC are presented in the consolidated statement of financial position net of the allowance for ECL. For loan commitments and financial guarantees, a separate provision for ECL is recognised as a liability in the consolidated statemen t of financial position. For debt instruments at FVOCI, changes in amortised cost, net of allowance for ECL, are recognised in profit or loss and other changes in carrying value are recognised in OCI as gains less losses on debt instruments at FVOCI. For contracts that include both a loan and an undrawn commitment and where the Group cannot separately distinguish the ECL on the undrawn loan component from the loan component, the ECL on the undrawn
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 54 commitment is recognised together with the loss allowance for the loan. To the extent that the combined ECLs exceed the gross carrying amount of the loan, they are recognised as a liability. In a subsequent period, if the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor's credit rating), the previously recognised impairment loss i s reversed by adjusting the allowance account. The amount of the reversal is recognised in the statement of profit or loss under ”credit loss allowance”. A more detailed overview of the credit risk management principles is given in Note 2 "Risk management". Interest income is recognised in the statement of profit or loss “Interest income calculated using effective interest rate method”. Cash and cash equivalents For the purposes of the cash flow statement, cash and cash equivalents comprise cash on hand, demand deposits due from central banks and other credit institutions and term deposits with original maturities of three months or less that are available for use without any significant restrictions and which are subject to an insignificant risk of changes in value. The cash flow statement is presented using the direct method. Lease receivables Finance lease transactions are lease transactions under which all significant risks and rights from using the assets are transferred from the Group to the lessee. Legal ownership of assets is transferred to the customer at the end of the lease term. The receivables from the finance lease agreements are recognised at net present value of the minimum lease payments, from which the payments of principal received have been deducted, plus unguaranteed residual value at the end of contract. Lease payments collect ed are allocated between repayment of principal and finance income. Finance income is recognised over the rental period based on the pattern reflecting a constant periodic rate of return on the lessor's net investment in the finance lease. The lessor's direct expenses related to the contract are part of effective interest rate and are booked as decrease of income from lease over the period of lease contract. Lease receivables are presented in the statement of financial position net of the loss allowance. A lease receivable from a client is recognised in the statement of financial position as of the moment of delivering the assets that are the subject of the agreement to the client. In case of transactions in which the assets that are the object of the agreement have a long delivery term have not yet been delivered to the client, the payments received from the lessees under these agreements are recognised in the statement of financial position as prepayments of buyers in line "Other financial liabilities". Factoring and warehouse financing receivables Factoring transactions are considered to be financing transactions where the Group provides the financial resources to its selling partners through transfer of the rights to the receivables from these sales transactions. The Group acquires the right for the receivables payable by the buyer subject to the sales contract. Factoring is the transfer of receivables. The transaction is booked as financing (i.e. loan secured by a claim), when the Group does not own all the rights related to the receivable (recours e factoring). The receivable is included in the statement of financial position until payment is received or recourse is expired. Warehouse receipt financing transactions are financing transactions where the lease firm finances its partners by granting them a loan against pledged stock reserves. Interest income is recognised in the statement of profit or loss using the effective interest rate method , in line with IFRS.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 55 1.6 Tangible and intangible assets Land, buildings, IT equipment, office equipment and other assets of long -term use are recognised in the statement of financial position as tangible assets. Intangible assets are identifiable, non -monetary assets without physical substance and as at balance sheet date comprise acquired or inte rnally developed software and licences (Note 13). Tangible and intangible assets are initially recognised at acquisition cost, consisting of the purchase price, non- refundable taxes and other direct costs related to taking the asset into use. Subsequent expenditures related to an item of tangible assets are recognised as an asset if these are in accordance with the definition of tangible assets and meet the criteria for recognition in the statement of financial position (including if it is probable that future economic benefits associated with the item wil l flow to the entity). Ongoing repairs and maintenance expenditures are expensed during the reporting period in which they are incurred. Tangible and intangible assets with finite useful lives are subsequently stated at historical cost less depreciation/amortisation and any impairment losses. Depreciation/amortisation is calculated starting from the date the asset is available to use until the asset is fully depreciated. Assets are depreciated/amortised on a straight-line basis. Depreciation/amortisation calculation is based on the useful life of the assets groups, which serves as the basis for forming the depreciation/amortisation rates. In the case of tangible assets, the annual depreciation rate for buildings is up to 5%, the depreciation rate for vehicles is up to 15% p.a., for improvements of rental space is up to 20% p.a. or until the end of the lease term, whichever is shorter. The annual depreciation rate for comp uters, office equipment and furniture are up to 25% p.a. For intangible assets, the annual depreciation rate for the group's core systems is 15% p.a., for user environments is 20% p.a. and for purchased licenses is up to 33% p.a. Non-current assets with an unlimited useful life (land) are not depreciated. Depreciation of non-current assets is presented in the statement of profit or loss line item "Depreciation". Gains or losses from sale of non-current assets is determined by comparison of the sales price with the carrying amount. Gain or loss on sale is recognised in the statement of profit or loss in the line items "Net gains from non-financial assets realisation ". Capitalisation of expenses Leasehold improvements related to the leased space used by the Group are capitalised as tangible assets and expensed on a straight-line basis in accordance with the duration of the lease agreement. Development costs If software development expenses result in additional functionality and if they meet the definition of intangible assets and criteria for inclusion in the statement of financial position (incl. expected participation in the generation of future economic benefits), such expenses a re recognised as intangible assets. Expenses related to the use of software are expensed as incurred. Expenditures incurred on advertising and the launch of new products, services and processes are expensed as incurred. Expenditures associated with internally developed trademarks and other such items are expensed as incurred.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 56 Goodwill Goodwill is recognised in acquisition value, less accumulated impairment losses. The Group tests the value of goodwill at least once a year or immediately if there is any indication that it might be impaired. Goodwill is distributed among cash- generating units or groups of cash -generating units that benefit from the synergy of the business combination. Profit or loss from the termination or sale of cash -generating units where goodwill is allocated consists of the carrying amount of the goodwill allocated to the unit. 1.7 Assets held for sale Assets held for sale are measured at the balance sheet date and are carried in the balance sheet at the lower of its carrying amount and fair value less costs to sell. 1.8 Leases – the Group as the lessee The Group leases office premises. At the inception of a contract, the Group assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Group determines the lease term as the non -cancellable period of a lease, together with both periods covered by an option to extend the lease if the lessee is reasonably certain to exercise that option, and periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise that option. The Group revises the lease term if there is a change in the non-cancellable period of a lease. Initial measurement Right-of-use asset are recorded on a separate line in the statement of financial position. At the commencement date, the Group measures the lease liability at the present value of the lease payments that are not paid at that date. The lease payments shall be discounted using the lessee's incremental borrowing rate. To determine the incremental borrowing rate, the Group uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing was received. For a contract that contains a lease component and one or more additional non -lease components, as a practical expedient, the Group has elected not to separate non-lease components from lease components, and instead account for each lease component and any associated non -lease components as a single lease component. Subsequent measurement After the commencement date, the Group measures the right-of-use asset applying a cost model. After the commencement date, a lessee shall measure the lease liability by: a) increasing the carrying amount to reflect interest on the lease liability; b) reducing the carrying amount to reflect the lease payments made; and c) remeasuring the carrying amount to reflect any reassessment or lease modifications or to reflect revised in- substance fixed lease payments. If there are changes in lease payments, there may be a need to remeasure the lease liability. The Group shall recognise the amount of the remeasurement of the lease liability as an adjustment to the right -of-use asset.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 57 However, if the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, a lessee shall recognise any remaining amount of the remeasurement in profit or loss on the line “Depreciation”. The Group has elected not to apply the requirements of IFRS 16 to short -term leases and leases for which the underlying asset is of low value. Payments associated with short-term leases and all leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less. Low - value assets comprise of IT equipment and leases, whose market value does not exceed the amount of 5,000 euros. 1.9 Received financial guarantee and credit protection (Synthetic Securitisation) The Group enters into synthetic securitisation transaction to transfer the credit risk of a specific loan and lease portfolio to the European Investment Fund (EIF). The Group’s management has assessed that the primary objective of the transaction is the optimisation of regulatory capital. As at 31.12.2025, the transaction had not yet become effective and had no impact on the financial results during the reporting period, but the transaction is expected to become effective in 2026, at which point the Bank will begin amortising the associated guarantee fees. In accordance with the terms of the transaction the guaranteed loan portfolio amounts to EUR 200 million. Of this amount, the Bank retains junior tranche of credit risk of approximately EUR 3 million, while credit risk of approximately EUR 197 million is transferred to the EIB Group. Upon the transaction becoming effective, the Bank’s risk weighted assets are expected to decrease by approximately EUR 147 million, as the risk weight applicable to the guaranteed exposures will be 0%. The quantitative impacts disclosed above are based on information available at the reporting date and may change upon finalisation of the transaction. Guarantee fees paid for credit protection are not a part of the effective interest rate (EIR) of the underlying loans, as the transaction is entered into for capital management purposes only. Prepaid guarantee fees will be recognised under "Other Assets" a s prepayments. The prepaid asset will be amortised on a straight -line basis to the profit or loss over the shorter of the protection period or the expected life of the protected portfolio. This expense will be recognised in the Statement of Profit or Loss and Other Comprehensive Income under "Net fee and commission income”. The asset will be tested for impairment in accordance with IAS 36 "Impairment of Assets" to ensure that the economic benefits still justify its carrying amount. Reimbursements from the EIF for realised credit losses will be recognised only when it is virtually certain that the compensation will be received. These reimbursements will be presented in the Statement of Profit or Loss and Other Comprehensive Income as a reduction of the "Credit loss allowance". 1.10 Financial liabilities The classification made can be seen in the table below:
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 58 Category by IFRS9 Category as determined by the Group Financial liabilities Financial liabilities measured at amortised cost Client deposits and loans received Private individuals Legal entities Credit institutions and central banks Debt securities Subordinated debt Other financial liabilities Contingent liabilities Loan commitments Financial guarantees Deposits from customers Deposits are recognised in the statement of financial position on their settlement date at fair value net of transaction costs and subsequently measured at amortised cost using the effective interest rate method and presented on the line item "Customer deposits and loans received”, accr ued interest is included in corresponding liabilities line items. Interest expense is recorded in the statement of profit or loss on the line "Interest and similar expense". Loans received Loans received are recognised initially at fair value net of transaction costs (the proceeds received, net of transaction costs incurred). Borrowings are subsequently stated at amortised cost using the effective interest rate method; any difference between proceeds (net of transaction costs) and the redemption value is recognised in the statement of profit or loss over the period of the instrument using the effective interest rate. The effective interest rate is the rate that exactly discounts the expected stream of future cash payments through maturity. The amortisation of the transaction costs is presented in the statement of profit or loss together with the interest expense. The respective interest expense is recorded in the statement of profit or loss on the line "Interest and similar expense". Loan commitments The Group issues commitments to provide loans. These commitments are irrevocable or revocable only in response to a material adverse change. Such commitments are initially recognised at their fair value, which is normally evidenced by the amount of fees received. This amount is amortised on a straight line basis over the life of the commitment, except for commitments to originate loans if it is probable that the Group will enter into a specific lending arrangement and does not expect to sell the resulting loan shortly after origination; such loan commitment fees are deferred and included in the carrying value of the loan on initial recognition. At the end of each reporting period, the commitments are measured at the higher of (i) the remaining unamortised balance of the amount at initial recognition, or (ii) the amount of the loss allowance determined based on the expected credit loss model. 1.11 Financial guarantee contracts Financial guarantees are given to banks, financial institutions, companies and other bodies on behalf of customers to secure loans, other banking facilities and liabilities to other parties.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 59 Financial guarantees are initially recognised in the financial statements at fair value (contract value) on the date the guarantee was given. In the statement of profit or loss the fee income earned on a guarantee is recognised on a straight-line basis over the life of the guarantee. In cases where the fees are charged periodically in respect of an outstanding guarantee, they are recognised as revenue on a time proportion basis over the respective guarantee period. At the end of each reporting period, the g uarantees are measured at the higher of (i) the remaining unamortised balance of the amount at initial recognition, or (ii) the amount of the loss allowance determined based on the expected credit loss model. The amounts disbursed to settle the guarantee obligation are recognised in the consolidated statement of financial position on the date it is disbursed. 1.12 Payables to employees Payables to employees include unpaid salary accruals, accruals for bonuses together with social security and unemployment insurance tax and a vacation pay accrual calculated in accordance with employment contracts and the laws of the Republic of Estonia in force as at the balance sheet date. The liability related to the payment of a vacation pay accrual together with social security and unemployment insurance premiums is included within current liabilities in the balance sheet and as payroll expenses in the consolidated statement of profit or loss. Social tax includes payments to the state pension fund. The Group has no existing legal or constructive obligations to make pension payments or similar payments supplementary to social tax. 1.13 Share-based payments The Group has established a share-based option programme, under which the Group issues options to employees to buy shares of Coop Pank AS in return for their services. The fair value of options issued is recognised as an expense over the term of the option programme as an increase in the Group's payroll expenses and an increase in equity (other reserves). The total cost is determined by the fair value of the options at the time they are issued. The fair value of the options is determined taking into account the market conditions affecting the option price, including the share price of Coop Pank AS. At the end of each reporting period, the Group estimates how many options are likely to become exercisable. Changes compared to initial estimates are recognised i n the statement of profit or loss and with a correspondent adjustment to equity. When the options are exercised, Coop Pank AS issues new shares. According to the terms and conditions of the share options, there are no social tax expenses when exercising options after 3 years. 1.14 Revenue and expense recognition Interest income and expense is recognised in the consolidated statement of profit or loss for all interest-earning financial assets and interest-bearing financial liabilities carried at amortised cost (AC) and debt financial assets at fair value through other comprehensive income (FVOCI) using the effective interest rate method. When calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the financial instrument but does not consider future credit losses. The calculation includes all significant fees paid or received between parties to the cont ract that are an integral part of the effective interest rate, transaction costs and all other premiums or discounts. Interest income is calculated by applying the effective interest rate to the gross carrying amount of financial assets, except for (i) financial assets that have become credit impaired (Stage 3), for which interest income is calculated by applying the effective interest rate to their amortised cost, net of the expected credit loss provision, and
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 60 (ii) financial assets that are purchased or originated credit impaired, for which the original credit adjusted effective interest rate is applied to the amortised cost. If the credit risk on the financial asset classified in Stage 3 subsequently improves so that the asset is no longer credit- impaired and the improvement can be related objectively to an event occurring after the asset had been determined as credit -impaired (i.e. the asset b ecomes cured), the asset is reclassified from stage 3 and the interest revenue is calculated by applying the effective interest rate to the gross carrying amount. The additional interest income, which was previously not recognised in profit and loss due to the asset being in stage 3 but is now expected to be received following the asset’s curing, is recognised as a reversal of impairment. Other similar income to interest income also includes income on interest bearing financial instruments classified at fair value through profit or loss. Fee and commission income The recognition of revenue from contracts with customers is reported as fee and commission income. This does not apply for revenue from leasing contracts or financial instruments and other contractual obligations within the scope of IFRS 9 Financial Instruments. Credit issuance fees for loans/leases are deferred and recognised as an adjustment to the effective interest rate on the credit. Fee and commission income are recognised when incurred. Such income includes recurring fees for account servicing. Variable fees are recognised only to the extent that management determines that it is highly probable that a significant reversal will not occur. Other fee and commission income is recognised at a point in time when the Group satisfies its performance obligation, usually upon execution of the underlying transaction. The amount of fee or commission received or receivable represents the transaction price for the services identified as distinct performance obligations. Such income includes fees for arranging a sale or purchase of foreign currencies on behalf of a customer, fees for processing payment transactions, fees for cash settlements, collection or cash disbursements, Revenue from sale of assets Revenue from sale of assets, except for tangible assets, is recognised at transaction price. Transaction price is the total consideration that the Group is entitled to receive for the transfer of promised goods or services to customer less amounts collected on behalf of third parties. The Group recognises revenue from sale of goods when the control over the goods or services is transferred to the customer. Dividend income Dividends are recognised in the statement of profit or loss when the entity's right to receive payment is established. 1.15 Statutory reserve capital The Group forms the statutory reserve capital from annual net profit allocations to comply with the requirements of the Commercial Code. In each financial year the Group transfers at least one-twentieth of the net profit to the statutory reserve, until the reserve reaches one-tenth of share capital.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 61 Note 2 Risk management Principles of risk management The Group defines risk as possible negative deviation from the expected result. Risk management is a process aimed at efficiency , sustainability and profitability of operations that would meet the expectations of shareholders identified in the strategy. As risks are associated with all business activities on all levels of activity, risk management involves all the Group's employees through the inte rnal control system. The tasks of risk management are the identification and measurement of business -related risks, implementation of measures necessary for controlling risks and reporting on risk management performance. In essence, the Group measures risks by: i) quantifying or assessing the potential magnitude of the risk through a change in the financial volume; or ii) qualitatively taking into account the operational control environment based on expert judgment of the magnitude of the risk and the likelihood of its occurrence. We have implemented risk appetite and tolerance metrics that help us identify trends in risk movement and prepare for actions required for better control or mitigation. Depending on the risk category, either monthly or quarterly reports are prepared. The qu arterly risk report is a summary report that reaches top management level. Structure and responsibility of risk management The Group's risk management system is centralised at management level - policies and principles of risk management are established at Group level by the Bank's Supervisory Board or Management Board to ensure implementation of common risk management principles in AS Coop Pank and its subsidiaries as well as rapid and effective response to changes in the economic environment or in the Group's business model. Risk management procedures must comply with existing legislative regulations and standards. The Bank's Management Board is responsible for the implementation of risk management, control and risk management policies and methods and the effectiveness of risk management. In organising risk management, the Management Board may in limited degree delegate risk taking, control and monitoring to collegial decision- making bodies with limited decision- making competence set up by the Management Board. The Bank's Management Board has set up the following committees and commissions with limited decision - making competence: The tasks, composition and activities of the Asset/Liability Management Committee are defined by its rules. The committee's task is to monitor, control, analyse and evaluate risks, make decisions and implement them in the following areas of responsibility: ● assessment and management of the Bank's and Group's liquidity risk and short - and long-term liquidity position; ● monitoring of the maturity structure of the Bank's assets and liabilities; ● planning of the balance of interest income and expenses and management of interest rate risk; ● introducing limits on term and volume measures related to counterparties; ● debt securities portfolio management. The Credit Committee is the Bank's highest body for making credit decisions, a workgroup responsible for risk management formed in accordance with the Credit Institutions Act and the Bank's statutes for ensuring that the Bank's credit policy is implemented through the adoption of credit decisions a nd compliance assessment of collateral.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 62 The Credit Commission performs the functions of the Credit Committee in adopting decisions on lower -risk credit. The Account Establishment Committee manages and controls the establishment of customer relationships and monitoring and, if necessary, termination of customer relationships through its decisions with clients with a higher risk of money laundering and terrorist financing prevention. For effective implementation of risk management, the Group uses a 3 -level control system in accordance with the principles of an internal control system approved by the Supervisory Board. Structural units with direct risk control functions: First line of defence The first level constitutes sales and support divisions and subsidiaries. The first line of defence is to ensure that risks related to the activities, products, and processes in its area of responsibility are identified, assessed and that measures necessary for controlling risks are implemented. Second line of defence The role of the second line of defence is performed by risk managers and analysts in the Risk Management Department and Credit Risk Department. The main functions of the second line of defence are: ● a group-wide view of regular identification, assessment and monitoring of risks; ● stress testing for liquidity, credit and market risks and drawing up relevant risk reports; ● the notification of the Management and Supervisory Board of risks; ● development of risk management methodology, first line of defence counselling in risk management; ● conducting training in the field of risk management; ● control and monitoring of compliance with internal rules and legislation; ● conducting scheduled and emergency internal controls within the organisation. Third line of defence Internal Audit Unit The Internal Audit Unit audits the compliance of the Group’s activities with legislation and instructions, the operation and efficiency of the business processes and internal control system, the compliance of the Bank’s structural units with the decisions taken by the Bank’s competent body, as well as compliance with the established rules, limits and other internal regulations. The activities of the Internal Audit Unit are aimed at protecting the interests of the Bank's shareholders, depositors and other creditors.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 63 Capital management The Group uses risk-based capital planning which ensures that all risks are adequately covered by own funds at any given time. Eligible capital is defined as the Group's own funds which consist of Tier 1 and Tier 2 capital. An overview of the regulatory capital is provided in the following table: Capital base 31.12.2025 31.12.2024 Tier 1 capital Paid-in share capital and share premium 98,771 96,892 Statutory reserve capital 8,424 6,815 Retained earnings excl. profit for the reporting period 96,989 73,629 The accepted profit of the reporting period* 16,449 19,545 Other accumulated comprehensive income/expense** -104 298 Goodwill as intangible asset (-) -6,757 -6,757 Intangible assets (-) -9,212 -12,954 Adjustment of value arising from requirements of reliable measurement (-) -55 -38 Other deductions from Tier 1 Capital (-) -1,081 -1,820 Common Equity Tier 1 (CET1) 203,424 175,610 Additional Tier 1 capital 28,148 28,148 Total Tier 1 capital 231,572 203,758 Subordinated debt 35,000 35,000 Tier 2 capital 35,000 35,000 Eligible capital for capital adequacy calculation 266,572 238,758 * Includes profit for the nine -month period ending on 30 September, which is included as approved by the Financial Supervisory Authority. ** Includes revaluation reserve of financial assets at fair value through other comprehensive income. Capital planning is conducted on the basis of financial position and profit and loss forecasts that take into account the Group's strategy, future expectations, risk profile and risk appetite. Capital planning is the responsibility of the Bank's Management Board. The internal capital adequacy assessment (ICAAP) is an ongoing process which aims to assess the Group's risk profile and the corresponding need for capital. ICAAP is the basis for regular capital planning in the Group. The planning and forecasting of capital requirements take place on the basis of calculating regulatory capital adequacy that takes into account capital requirements and guidance arising from ICAAP and supervisory assessment of the Financial Supervisory Authority (SREP). The Group's risk profile is assessed in particular by the following risks: credit risk, concentration risk, liquidity risk, market risk, including pricerisk exposure from the portfolio of financial investments, the Bank's portfolio of interest rate risk, operational risk, strategic risk, reputation risk. The recommended minimum capital adequacy level is the minimum required capital adequacy level determined in the SREP assessment plus the need -based reserve required for increasing business volumes, implementing strategy plans and ensuring a stable financial position in ac cordance with the Group's current operating strategy and balance sheet forecasts.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 64 The financial position and profit and loss forecasts are reviewed regularly and approved by the Bank's Management Board. It also takes into account the possible impact of strategic and reputation risk to the Group's business success, and determines the necessary equity buffer to ensure the desired internal capital adequacy level if alternative and risk scenarios materialise. Overview of the development of capital adequacy including the capital requirements arising fro m the SREP assessment are presented to t he Bank's Management Board and the Supervisory Board on a quarterly basis. As at 31.12.2025 and also as at 31.12.2024, the Group was in compliance with all regulatory capital requirements. Credit risk management Credit risk is the risk of suffering financial loss, should any of the Group’s customers or counterparties fail to fulfil their contractual obligations to the Group. The Group follows the standard method of calculating credit risk capital requirements. In calculating capital requirements, the Group uses ratings of accepted rating agencies according to the procedure established by the Financial Supervisory Authority. Credit risk management is based on the Group's credit policy. The main objectives of credit policy are to sustainably achieve the rate of return on the Group's assets from credit activities required by shareholders, adhering to the prudency and risk diversification principles an d taking moderate risks that can be evaluated and managed. Credit risk arises from the following financial instruments: ● Cash, cash balances at central banks and other deposits, Note 9); ● Debt securities (Note 10); ● Loans and advances to customers (Note 11); ● Derivatives (Note 2); ● Other financial assets (Note 12). The cash placements to credit institutions and financial investments into debt securities are done within the counterparty transaction limits imposed by the Assets and Liabilities Committee (ALCO). When assessing the counterparty creditworthiness and credit limit, the counterparty’s domicile, financial position, management, legal status and market position are taken into consideration. Additionally, for investments into debt securities the liquidity and rating are assessed. Credit risk measurement The Group uses internal credit risk gradings that reflect its assessment of the probability of default of the individual counterparties. The Group evaluates corporate customers' creditworthiness using a rating model that considers both their financial and economic status as well as their payment history, categorising them into 12 different risk classes. Statistical scoring models, first implemented in 2025 for retail customers, are used to assess the probability of default (PD) for individual loan agreements. The transition to the new models from the previously used rating models did not materially affect the size of impairments (the total impairment for retail customers decreased by an estimated 3%). Separate models are used to determine the loss ‑given‑default (LGD) resulting from default.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 65 The Group’s credit exposures are classified and grouped once per month. Credit risk classes for credit exposures apply to private and corporate customers . D epending on the borrower’s payment discipline, financial‑economic condition and other factors increasing credit risk, the risk classes are as follows: Risk class PD Comparable S&P rating Description 1 <0,2% A... AAA The obligor's capacity to meet its financial commitment on the obligation is very strong 2 >0,2% - 0,5% BBB The obligor's capacity to meet its financial commitment on the obligation is adequate. Adverse economic conditions or changing circumstances are likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation 3 >0,5% - 1,0% BB+ The obligor's capacity to meet its financial commitment on the obligation is adequate in the short-term perspective. Adverse business, financial, or economic conditions could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation. 4 >1,0% - 1,5% BB 5 >1,5% - 2,5% BB- 6 >2,5% - 5,0% B+ The obligor's capacity to meet its financial commitment on the obligation is adequate in the short-term perspective. Adverse business, financial, or economic conditions will likely impair the obligor's capacity to meet its financial commitment on the obligation. 7 >5,0% - 7,5% B 8 >7,5% - 10,0% B- 9 >10,0% - 20,0% CCC The obligor's capacity to meet its financial commitment on the obligation is questionable and is dependent upon favourable business, financial, or economic conditions for the obligor to meet its financial commitment on the obligation. Probable payment delays. 10 >20,0% - 60,0% CC The obligor's capacity to meet its financial commitment on the obligation is probably insufficient. Payment delays. 11 >60,0% - 99,99% C The obligor's capacity to meet its financial commitment on the obligation is insufficient. Payment delays. 12 100,0% D The obligor is in default. In 2025 uncertainty in the economy continued. There are several factors influencing the macroeconomic situation starting from, the ongoing war in Ukraine, U.S. trade and foreign policy developments, and the economic challenges faced by key trading partners such as Finland and Germany etc. Despite falling inflation levels and EURIBOR rates and a low unemployment, the confidence level of consumers has not improved. Nevertheless, the effects on the credit portfolio are not noticeable, the overdue debt level is continuously very
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 66 low, there is very limited demand for payment holidays and the collateral values have not been affected yet. The Group follows closely the changes in overall market conditions and has adapted its general credit risk evaluation, processes and models according to the changed economic environment and outlook. Clients whose activities could pose an environmental risk are checked on a case -by-case basis to ensure that their activities are in line with all valid norms of environmental protection. Measurement of expected credit loss (ECL) The impairment requirements are based on a three -stage expected credit loss (ECL) model, which considers changes in credit quality since initial recognition. The Group uses internally developed models which take into account external macroeconomic indicators. In accordance with IFRS 9 the financial instruments are classified into three stages based on the number of days of past due, the financial position of the legal entity and other changes in the quality of the receivable, either as a performing receivable (stage 1), an under-performing receivable (significant increase in credit risk, stage 2) or a non-performing receivable (default, stage 3). The allowance rate for Stage 1 receivables is based on the 12 - month expected credit loss. The allowance rate for Stage 2 and Stage 3 receivables is determined on the basis of lifetime expected credit losses; the latter assumes default of the financial instruments. Expected credit loss is calculated based on probability of default (PD), loss given default (LGD) and exposure at default (EAD) discounted to present day. For assessment of loan losses, the expected collections from the loan and interest payments over the coming periods are considered, as well as expected collections and anticipated proceeds from the realisation of collateral, sale of the loan or future payments arising from the solvency, discounted at the financial asset's original effective interest rate or the interest rate set out in EBA guidelines , which together form a recoverable amount of the loan. Explanation of inputs, assumptions and modelling techniques PD models For corporate customers, PD is determined using a rating model based on historical portfolio behaviour and internal expert judgment. Inputs include an assessment of the customer’s financial ‑economic condition and payment behaviour. The assessment of the financial-economic condition evaluates various financial ratios and provides a final rating on a 10 ‑point scale. The rating model assigns customers to 12 risk classes, each with associated 12‑month and lifetime PDs, used depending on the loan stage. For retail customers, the initial 12‑month probability of default is estimated based on applicant and application characteristics. A logistic regression formula is used for the calculation, incorporating both the main effects and interactions of the key variables. The model was derived using a machine‑learning method based on historical data, optimizing the model’s AIC (Akaike Information Criterion) value. The 12 ‑month model includes a macroeconomic adjustment. To achieve the highest possible accuracy, different models use different features that are important for the specific loan type. Separate models cover among others consumer loans, mortgages and leases. The initial PD is adjusted monthly using a behavioural PD model. The probability that a properly serviced loan will default decreases over time, therefore, the probability of default is adjusted downward using a function specific to the loan type. For loans with significantly increased credit‑risk (Stage 2) lifetime behavioural PD model is used and Stage 3 loans are assigned PD of 100%. Coefficients for lifetime PD models are estimated from historical data according to remaining loan maturity. LGD models
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 67 LGD models are based on actual historical loss data from the Group. The debt amounts of defaulted agreements and post ‑default recoveries from customers and collateral sales have been used. Results are discounted to defaulting time and aggregated by product group. To compensate for data limitations and possible inaccuracies, conservatism margins are added to LGD estimates. Forward-looking information incorporated in ECL model Forward‑looking information is included in ECL measurement by estimating the expected impact of changes in macroeconomic indicators on the share of defaulted consumer, mortgage and corporate loans within the loan portfolio. Time‑series models are used; macroeconomic variables are included with appropriate lags. A separate model is found for each loan type. Forecasting takes place with the corresponding final model and is forecasted step by step for one month. Of the macroeconomic indicators, the Group uses a mix of indicators which, according to performed analysis, proved to be statistically relevant for different product groups: Consumer loans – previous consumer loan debt ratios, unemployment rate 17 months ago , consumer price index 13 months ago, EUR/USD exchange rate 21 months ago; Mortgage loans – previous mortgage loan debt ratios, GDP 5 months and 6 months ago, consumer price index 7 months ago; Corporate loans – previous corporate loan debt ratios, GDP 18 months ago, Brent oil price as per the same month. The regression analysis was made between Estonia’s overdue loans and macro indicators. Forecasts of macro indicators are based on the latest available analysis of the Bank of Estonia on macroeconomic trends. The weighted impact on the probability of defaul t is calculated using a weighting of 60% for the baseline scenario, 10% for a positive scenario and 30% for a negative scenario for all product groups, where expert opinions have been used to determine the weights. Compared to 2024, the weights remained unchanged. Individual and collective assessment, grouping Loans are individually assessed where the total risk of the client (on-balance plus off-balance amount) exceeds 500 thousand euros and has been assigned to loan stage 3. Loans to watchlist clients exceeding 500 thousand euros are also individually assessed. Credit receivables are assessed on a collective or individual basis, based on the classification and grouping results. The purpose of grouping receivables is to collect receivables with similar credit risk to assess them on a collective basis, considering the type of loan, loan collateral and credit rating. The prerequisite for grouping is the availability of sufficient and statistically reliable information. The calculation of the characteristics and allowance rates of groups of receivables is based on the analysis of the statistical behaviour of the loan portfolio, changes in the actual loss events and the general economic situation, macroeconomic forecasts and the impact of the respective macro indicators on the solvency of the customers and collateral values. Frequency of receivable assessments: ● collective assessment is performed on a monthly basis; ● individual assessment is performed quarterly and the results are approved by the Bank's Credit Committee.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 68 Significant increase in credit risk The Group considers a financial instrument to have a significant increase in credit risk where one or more of the following criteria have been met: ● the customer’s contractual payments have been past due over 30 days at least once in the past three months or repeatedly in past year; ● one of the customer’s receivables is restructured due to payment difficulties or has been repeatedly restructured due to payment difficulties; ● corporate borrower has significant payment defaults to other creditors; ● in the case of claims secured by real estate of a private customer, the loan amount exceeds the value of the collateral; ● the customer is on the watchlist. All receivables from the same corporate borrower are valued in the same category as the lowest risk category and loan stage In determining past due obligations in risk classification the Group uses materiality thresholds set by capital regulation No 575/2013. Signs that indicate the potential need to include customers to the watchlist are: ● negative macroeconomic events that affect the customer or the industry etc.; ● adverse changes in the financial condition of the customer that can significantly affect their ability to service the debt; ● some of the claims of the customer are restructured; ● customer’s weakened payment behaviour and >30 overdues; ● customer is in breach with financial covenants in the extent that indicates the limited possibilities to correctly service the debt; ● adverse changes in collateral values and position; ● legal actions and measures that can result in a significant impact on the customer’s financial condition; ● remarks brought out by the external auditors; ● other factors that indicate potentially increased credit risk. Definition of default and credit-impaired assets The Group defines financial assets as default, which is fully aligned with the definition of credit-impaired, based on the following qualitative or quantitative criteria: Quantitative criteria: ● at least one of the loans issued to the customer is more than 90 days past due on its contractual payments (principal or interest) or has been repeatedly more than 90 days past due on its contractual payments and overdue debt exceeds materiality threshold; or ● customer’s receivables have been more than three times restructured due to payment difficulties. Qualitative criteria: ● significant deterioration in the company’s financial position to the extent that the customer is unable to service and repay the loan; ● infringement of financial or other covenants to an extent that materially affects the customer’s solvency and ability to repay the loans; ● unintentional use of the funding received compared to what was agreed in the loan agreement to an extent that substantially affects the customer’s solvency and ability to repay the loans; ● the client has filed (or filed against) a bankruptcy petition or a similar application for legal protection (e.g. reorganisation);
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 69 ● the client’s cash flow/income is insufficient to fully meet their obligations and the client’s collateral has been settled in enforcement or bankruptcy proceedings; ● the net present value of receivable has been reduced more than 1% of the receivable amount in the course of restructuring due to payment difficulties and the characteristics of the restructuring due to payment difficulties remain; ● credit exposure has been restructured multiple times and it is probable that the customer is not able to service and repay the loans according to agreed terms; ● a private customer has died, and the receivable has not been re -written to a new borrower (such as an heir); ● the customer has committed fraud. If the loan that is restructured due to payment difficulties has been properly serviced for at least 12 months and none of the above criteria is present (default criteria or signs of significant increase in credit risk), the loan can be classified as performing receivable. Sensitivity analysis When conducting sensitivity analysis, the Group uses changes in macro indicators which, according to performed analyses, proved to be statistically relevant and have more effect on the changes in probability of customers default and thereby allowances. Actual levels of ma cro indicators published by Bank of Estonia, Statistics Estonia and Land Board and forecasts made by the Ministry of Finance, Bank of Estonia and the Group were used in the analysis. A sensitivity analysis shows impact on the Group’s ECL if different macro indicator values are used in ECL calculations. During analysis in addition to the main forecast, which is called base scenario, a confidence interval was also calculated, which is used as the positive and the negative scenario. The weighted impact on probability of default is calculated using weighting of 60% for a b ase scenario, 10% for a positive scenario and 30% for a negative scenario for all the loan categories. The weights were not changed in 2025. The table below shows the impact of changes in the base scenario weights on the Group’s loan portfolio as at 31.12.2025. Change in the weights of the scenario (base-positive-negative) Impact on ECL in thousands of euros 60%-0%-40% 36 60%-20%-20% 57 As at 31.12.2024, the impact of changes in the base scenario weights were the following: Change in the weights of the scenario (base-positive-negative) Impact on ECL in thousands of euros 60%-0%-40% 390 60%-20%-20% -352 This table shows the Group’s ECL change as of 31.12.2025, if the following changes had occurred in macroeconomic indicators relative to the base scenario . The model used in the Group has significantly improved compared to the previous version. In 2025, a time ‑series model was introduced, where the dependent variable itself is an important input and the structure of input data has also changed. As a result, the estimated impact of macroeconomic indicators differs from that of the previous model. in thousands of euros Impact of increase Impact of decrease Unemployment rate +/-1% 56 -76 Consumer price index +/- 2% 135 -109 Brent oil price +/- 10% 108 -125 GDP growth change +/-2% -39 3
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 70 This table shows the Group’s ECL change as of 31.12.2024, if the following changes had occurred in macroeconomic indicators relative to the base scenario: in thousands of euros Impact of increase Impact of decrease Average wages and salaries +/-5% -33 13 Unemployment rate +/-1% 693 -542 Business loan interest margin +/-0.5% 0 -33 Mortgage loan interest margin +/-0.5% 112 -137 6 months EURIBOR +/-0.5% 575 -474 Real estate price index +/-2% -33 13 Employment rate +/-1% -33 13 GDP growth change +/-2% -350 558 Maximum exposure to credit risk The derivatives maximum exposure to credit risk, without taking collateral into account, corresponds to its carrying amount and is 3,681 thousand euros as at 31 December 2025. The Company has entered into a derivative contract with a counterparty that is subject to a cash collateral exchange agreement (Credit Support Annex). Under this agreement, the Company has received from the counterparty a cash deposit provided as collateral in the amount of 3,540 thousand euros. The collateral is enforceable or eligible for set off in the event of counterparty default. In the Company’s assessment, the cash deposit of 3,540 thousand euros received from the counterparty significantly reduces the actual credit risk, as the collateral is fully enforceable or available for set off before any potential losses arise. Accordingly, while the maximum exposure to credit risk remains equal to the carrying amount of 3,681 thousand euros, the existence of the collateral materially reduces the Company’s net exposure which is in the amount of 141 thousand euros. The Group’s maximum exposure to credit risk from financial instruments subjected to impairment: 31.12.2025 Stage 1 Stage 2 Stage 3 Total Cash balances at central banks and other deposits 484,429 0 0 484,429 Debt securities at fair value through other comprehensive income 58,035 0 0 58,035 Debt securities at amortized cost 4,988 0 0 4,988 Loans to private individuals 1,023,188 32,238 6,360 1,061,786 Consumer loans 95,447 5,722 2,010 103,179 Finance lease receivables 93,677 1,536 216 95,429 Mortgage and other private loans 834,064 24,980 4,134 863,178 Loans to legal entities 1,042,230 21,837 7,659 1,071,726 Finance lease receivables 82,276 2,981 454 85,711 Investment loan, overdraft facility and other business loans 959,954 18,856 7,205 986,015 Total loans 2,065,418 54,075 14,019 2,133,512 Loss allowance -10,854 -3,197 -5,370 -19,421 Total of net loans 2,054,564 50,878 8,649 2,114,091 Other financial assets 741 0 0 741 Total net on-balance sheet exposures 2,602,757 50,878 8,649 2,662,284 Exposures related to off-balance sheet items Financial guarantees 29,245 294 0 29,539 Unused credit limits 39,975 256 40 40,271 Unused overdrafts 172,240 326 4 172,570 Total off-balance sheet exposures 241,460 876 44 242,380 Loss allowance -811 -13 -4 -828 Total net off-balance sheet exposures 240,649 863 40 241,552
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 71 31.12.2024 Stage 1 Stage 2 Stage 3 Total Cash balances at central banks and other deposits 341,912 0 0 341,912 Debt securities at fair value through other comprehensive income 37,351 0 0 37,351 Loans to private individuals 897,353 28,409 6,138 931,900 Consumer loans 101,672 4,313 2,161 108,146 Finance lease receivables 94,222 1,542 139 95,903 Mortgage and other private loans 701,459 22,554 3,838 727,851 Loans to legal entities 828,200 23,885 8,684 860,769 Finance lease receivables 94,987 3,069 767 98,823 Investment loan, overdraft facility and other business loans 733,213 20,816 7,917 761,946 Total loans 1,725,553 52,294 14,822 1,792,669 Loss allowance -9,570 -3,951 -5,030 -18,551 Total of net loans 1,715,983 48,343 9,792 1,774,118 Other financial assets 1,610 0 0 1,610 Total net on-balance sheet exposures 2,096,856 48,343 9,792 2,154,991 Exposures related to off-balance sheet items Financial guarantees 18,379 101 18 18,498 Unused credit limits 39,899 490 24 40,413 Unused overdrafts 91,748 922 7 92,677 Total off-balance sheet exposures 150,026 1,513 49 151,588 Loss allowance -444 -34 -5 -483 Total net off-balance sheet exposures 149,582 1,479 44 151,105 As of 31.12.2024 Coop stores client card for private customers was classified under consumer loans in the amount of 10,211 thousand euros, starting from 2025 this is classified under mortgage loans and other private loans to ensure a more consistent approach to product management and more accurate allocation of costs and revenues. The comparatives have not been reclassified due to the lack of readily available historical data and the impracticability of obtaining it. As of 31.12.2024, warehouse financing for leasing business customers was classified under lease financing in the amount of 16,600 thousand euros, starting from 2025 this is classified under other business loans to ensure consistent product management in alignment with a unified business strategy, while also enabling improved oversight of risk positions. The comparatives have not been reclassified due to the lack of readily available historical data and the impracticability of obtaining it. These changes are descibed as „Reclassification in operating segment“ in the following tables, where relevant. Receivables from credit institutions and financial investments in securities, breakdown by credit quality: 31.12.2025 AA- and higher A- to A+ BBB- to BBB+ BB- to BB+ B- to B+ CCC-D Total Risk class 1 1 2 3 to 5 6 to 8 9 to 12 Base level of the mandatory reserve kept in the Central Bank 18,985 0 0 0 0 0 18,985 Demand deposits at the Central Bank 443,316 0 0 0 0 0 443,316 Receivables from credit institutions and other financial institutions* 990 21,138 0 0 0 0 22,128 Debt securities at fair value through other comprehensive income 0 48,647 5,752 3,636 0 0 58,035 Debt securities at amortized cost 0 0 0 4,988 0 0 4,988
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 72 31.12.2024 AA- and higher A- to A+ BBB- to BBB+ BB- to BB+ B- to B+ CCC-D Total Risk class 1 1 2 3 to 5 6 to 8 9 to 12 Base level of the mandatory reserve kept in the Central Bank 18,316 0 0 0 0 0 18,316 Demand deposits at the Central Bank 299,380 0 0 0 0 0 299,380 Receivables from credit institutions and other financial institutions* 3,193 21,023 0 0 0 0 24,216 Debt securities at fair value through other comprehensive income 0 30,912 3,711 3,128 0 0 37,751 On assessing the credit quality, the Group uses credit ratings from rating agencies Fitch, Moody’s and Standard & Poor’s according to the recitals of European Parliament and of the Council (EC) No. 575/2013 Article 138. According to Article 114 of the mentioned regulation, receivables from the European Central Bank have the highest credit quality level, and receivables from the national central banks of member states have also the highest credit quality level, if these receivables are nominated in euros. Coop Pank cash on hand is not exposed to counterparty credit risk, as the balance of this position belongs to the bank itself, while a third-party cash management service provider is used for handling the physical cash. Coop Pank high-quality receivables from the central bank (The Bank of Estonia) are not rated but can be classified as AA- or higher credit quality. The management has estimated that credit institutions’ receivables carry low credit risk and that their expected credit losses are insignificant, given their strong credit rating, financial condition and short -term economic outlook. Other non-rated receivables from credit institutions and other financial institutions are of good quality and there is no indication of impairment. Debt securities at fair value through other comprehensive income are predominantly liquid, which is why their expected credit losses are also considered insignificant. Debt securities at amortised cost that do not have an international credit rating (Fitch, Moody’s, or S&P) are assessed based on internal methodology. For these instruments, the Group applies assessment principles and risk class assignments consistent with those used for loan customers (see section "Credit risk measurement"). The credit quality is evaluated taking into account the issuer's payment discipline, financial-economic condition, and other factors increasing credit risk.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 73 Loans to customers divided by stage and credit quality in different loan classes is presented in the following tables: 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 210,863 235 0 211,098 4,422 47 0 4,469 II credit quality class 524,188 399 0 524,587 711,587 133 0 711,720 III credit quality class 286,949 3,438 0 290,387 233,518 1,137 0 234,655 IV credit quality class 226,822 5,598 0 232,420 180,707 1,323 0 182,030 V credit quality class 528,913 10,675 0 539,588 296,538 2,623 0 299,161 VI credit quality class 179,707 6,155 0 185,862 222,437 2,339 0 224,776 VII credit quality class 69,450 3,160 0 72,610 69,698 1,112 0 70,810 Specific monitoring VIII credit quality class 28,200 2,065 0 30,265 5,226 25,162 0 30,388 IX credit quality class 10,324 14,882 0 25,206 1,420 12,642 0 14,062 X credit quality class 2 3,546 0 3,548 0 5,405 0 5,405 Non-performing loans XI credit quality class 0 3,922 0 3,922 0 350 0 350 XII credit quality class 0 0 14,019 14,019 0 21 14,822 14,843 Total 2,065,418 54,075 14,019 2,133,512 1,725,553 52,294 14,822 1,792,669 Loss allowance -10,854 -3,197 -5,370 -19,421 -9,570 -3,951 -5,030 -18,551 Carrying amount 2,054,564 50,878 8,649 2,114,091 1,715,983 48,343 9,792 1,774,118 Consumer loans 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 18 0 0 18 19 0 0 19 II credit quality class 0 0 0 0 0 0 0 0 III credit quality class 33,536 0 0 33,536 0 0 0 0 IV credit quality class 12,293 153 0 12,446 9,906 0 0 9,906 V credit quality class 15,245 229 0 15,474 0 0 0 0 VI credit quality class 19,857 384 0 20,241 90,402 0 0 90,402 VII credit quality class 6,539 311 0 6,850 61 0 0 61 Specific monitoring VIII credit quality class 3,136 242 0 3,378 0 0 0 0 IX credit quality class 4,823 566 0 5,389 1,284 128 0 1,412 X credit quality class 0 1,436 0 1,436 0 3,835 0 3,835 Non-performing loans XI credit quality class 0 2,401 0 2,401 0 350 0 350 XII credit quality class 0 0 2,010 2,010 0 0 2,161 2,161 Total 95,447 5,722 2,010 103,179 101,672 4,313 2,161 108,146 Loss allowance -1,505 -1,561 -1,698 -4,764 -1,909 -1,148 -1,860 -4,917 Carrying amount 93,942 4,161 312 98,415 99,763 3,165 301 103,229
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 74 Finance lease receivables to private customers 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 949 0 0 949 4 0 0 4 II credit quality class 58,633 0 0 58,633 32 0 0 32 III credit quality class 26,153 237 0 26,390 93,669 0 0 93,669 IV credit quality class 3,222 325 0 3,547 162 0 0 162 V credit quality class 2,530 396 0 2,926 73 1,281 0 1,354 VI credit quality class 1,780 271 0 2,051 278 0 0 278 VII credit quality class 153 137 0 290 0 256 0 256 Specific monitoring VIII credit quality class 153 61 0 214 4 0 0 4 IX credit quality class 104 57 0 161 0 0 0 0 X credit quality class 0 0 0 0 0 5 0 5 Non-performing loans XI credit quality class 0 52 0 52 0 0 0 0 XII credit quality class 0 0 216 216 0 0 139 139 Total 93,677 1,536 216 95,429 94,222 1,542 139 95,903 Loss allowance -114 -18 -44 -176 -127 -9 -28 -164 Carrying amount 93,563 1,518 172 95,253 94,095 1,533 111 95,739 Mortgage and other private loans 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 207,045 0 0 207,045 74 0 0 74 II credit quality class 410,802 51 0 410,853 691,639 0 0 691,639 III credit quality class 66,067 1,791 0 67,858 1,249 0 0 1,249 IV credit quality class 50,095 4,293 0 54,388 7,370 0 0 7,370 V credit quality class 61,138 6,819 0 67,957 662 0 0 662 VI credit quality class 23,993 3,986 0 27,979 320 0 0 320 VII credit quality class 6,591 1,034 0 7,625 31 0 0 31 Specific monitoring VIII credit quality class 2,960 857 0 3,817 114 22,427 0 22,541 IX credit quality class 5,373 2,913 0 8,286 0 44 0 44 X credit quality class 0 1,767 0 1,767 0 83 0 83 Non-performing loans XI credit quality class 0 1,469 0 1,469 0 0 0 0 XII credit quality class 0 0 4,134 4,134 0 0 3,838 3,838 Total 834,064 24,980 4,134 863,178 701,459 22,554 3,838 727,851 Loss allowance -965 -376 -904 -2,245 -338 -765 -711 -1,814 Carrying amount 833,099 24,604 3,230 860,933 701,121 21,789 3,127 726,037
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 75 Finance lease receivables to legal entities 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 2,271 235 0 2,506 3,407 47 0 3,454 II credit quality class 4,732 150 0 4,882 6,530 118 0 6,648 III credit quality class 12,559 443 0 13,002 14,202 397 0 14,599 IV credit quality class 16,897 175 0 17,072 35,433 125 0 35,558 V credit quality class 24,456 83 0 24,539 16,568 113 0 16,681 VI credit quality class 19,046 706 0 19,752 15,515 225 0 15,740 VII credit quality class 1,426 35 0 1,461 2,617 462 0 3,079 Specific monitoring VIII credit quality class 863 59 0 922 687 1,431 0 2,118 IX credit quality class 24 1,095 0 1,119 28 120 0 148 X credit quality class 2 0 0 2 0 10 0 10 Non-performing loans XI credit quality class 0 0 0 0 0 0 0 0 XII credit quality class 0 0 454 454 0 21 767 788 Total 82,276 2,981 454 85,711 94,987 3,069 767 98,823 Loss allowance -389 -78 -115 -582 -415 -54 -246 -715 Carrying amount 81,887 2,903 339 85,129 94,572 3,015 521 98,108 Investment loan, overdraft facility and other business loans 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 580 0 0 580 918 0 0 918 II credit quality class 50,021 198 0 50,219 13,386 15 0 13,401 III credit quality class 148,634 967 0 149,601 124,398 740 0 125,138 IV credit quality class 144,315 652 0 144,967 127,836 1,198 0 129,034 V credit quality class 425,544 3,148 0 428,692 279,235 1,229 0 280,464 VI credit quality class 115,031 808 0 115,839 115,922 2,114 0 118,036 VII credit quality class 54,741 1,643 0 56,384 66,989 394 0 67,383 Specific monitoring VIII credit quality class 21,088 846 0 21,934 4,421 1,304 0 5,725 IX credit quality class 0 10,251 0 10,251 108 12,350 0 12,458 X credit quality class 0 343 0 343 0 1,472 0 1,472 Non-performing loans XI credit quality class 0 0 0 0 0 0 0 0 XII credit quality class 0 0 7,205 7,205 0 0 7,917 7,917 Total 959,954 18,856 7,205 986,015 733,213 20,816 7,917 761,946 Loss allowance -7,881 -1,164 -2,609 -11,654 -6,781 -1,975 -2,185 -10,941 Carrying amount 952,073 17,692 4,596 974,361 726,432 18,841 5,732 751,005
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 76 Off-balance exposures of credit lines and overdraft facilities 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 300 0 0 300 107 0 0 107 II credit quality class 12,382 0 0 12,382 9,992 0 0 9,992 III credit quality class 23,104 5 0 23,109 16,468 55 0 16,523 IV credit quality class 44,904 0 0 44,904 47,038 100 0 47,138 V credit quality class 82,722 22 0 82,744 42,303 4 0 42,307 VI credit quality class 36,988 6 0 36,994 7,787 0 0 7,787 VII credit quality class 10,473 23 0 10,496 7,827 0 0 7,827 Specific monitoring VIII credit quality class 1,130 196 0 1,326 125 452 0 577 IX credit quality class 212 314 0 526 0 800 0 800 X credit quality class 0 16 0 16 0 1 0 1 Non-performing loans XI credit quality class 0 0 0 0 0 0 0 0 XII credit quality class 0 0 44 44 0 0 31 31 Total 212,215 582 44 212,841 131,647 1,412 31 133,090 Loss allowance -763 -10 -4 -777 -421 -33 -4 -458 Carrying amount 211,452 572 40 212,064 131,226 1,379 27 132,632 Off-balance exposures of financial guarantees 31.12.2025 31.12.2024 Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Normal monitoring I credit quality class 11 0 0 11 36 0 0 36 II credit quality class 551 0 0 551 602 0 0 602 III credit quality class 10,395 14 0 10,409 937 0 0 937 IV credit quality class 5,508 0 0 5,508 2,947 0 0 2,947 V credit quality class 3,318 21 0 3,339 11,561 0 0 11,561 VI credit quality class 3,189 59 0 3,248 170 0 0 170 VII credit quality class 6,273 0 0 6,273 1,858 59 0 1,917 Specific monitoring VIII credit quality class 0 0 0 0 268 24 0 292 IX credit quality class 0 200 0 200 0 18 0 18 X credit quality class 0 0 0 0 0 0 0 0 Non-performing loans XI credit quality class 0 0 0 0 0 0 0 0 XII credit quality class 0 0 0 0 0 0 18 18 Total 29,245 294 0 29,539 18,379 101 18 18,498 Loss allowance -48 -3 0 -51 -23 -1 -1 -25 Carrying amount 29,197 291 0 29,488 18,356 100 17 18,473
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 77 Allocation of past due loans (gross carrying amount) 31.12.2025 Loans to private individuals Loans to legal entities Consumer loans Finance lease Mortgage loans and other loans Finance lease Investment loan, overdraft facility and other business loans Total 1-30 days 3,833 2,471 13,507 2,014 3,418 25,243 31-60 days 886 618 3,535 212 682 5,933 61-90 days 512 162 1,698 0 5 2,377 Over 90 days 1,898 7 1,485 0 2,041 5,431 Total 7,129 3,258 20,225 2,226 6,146 38,984 31.12.2024 Loans to private individuals Loans to legal entities Consumer loans Finance lease Mortgage loans and other loans Finance lease Investment loan, overdraft facility and other business loans Total 1-30 days 4,713 2,105 11,709 2,420 2,834 23,781 31-60 days 1,292 381 2,697 95 1,632 6,097 61-90 days 593 172 701 120 105 1,691 Over 90 days 2,141 27 1,735 226 2,544 6,673 Total 8,739 2,685 16,842 2,861 7,115 38,242 Collaterals of financial assets The Group evaluates the value of collateral both during the loan application process and subsequently. The Group has internal rules for the maximum acceptance value of different types of collateral at the time of applying for a loan. Estimates of the market value of collateral are based on the prudence principle and take into account the type, location, liquidity and probability of realisation of collateral. Expert assessments are used to assess immovables. Individual valuations of commercial real estate are updated at least once a year. In the case of residential and other homogenous types of real estate, statistical indexing models are also used for regular revaluation. The main types of loan collaterals are: ● real estate (mortgage on property); ● rights of claims; ● commercial pledge; ● machinery and equipment; ● guarantee of Estonian Business and Innovation Agency (EIS) or Rural Development Foundation; ● a surety or guarantee from a private person or legal entity; ● bank deposit; ● pledge of shares; ● traded securities.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 78 Collaterals with a low correlation between the customer's payment risk and the market value of the collateral are preferred. Assets pledged as collateral must be insured, the life of the collateral must be longer than the loan repayment term and the market value of the collateral must exceed the loan balance. Unsecured loans are issued to private individuals to a limited extent. Legal persons are only granted unsecured loans if the client's credit risk is very low, the solvency is high, and the cash flow forecast is stable. During the reporting period, the Group's internal rules regarding collateral have not changed significantly and there has also been no significant change in the overall quality of collateral. Compared to the year 2024, in 2025, collateral values were allocated pro-rata to the respective loan amounts they secure. An overview of the over and under-collateralised loans to customers are given in the tables below. 31.12.2025 Over-collateralised loans Under-collateralised loans Gross carrying amount Fair value of the collateral Gross carrying amount Fair value of the collateral Loans to private individuals Consumer loans 0 0 103,179 0 Finance lease receivables 68,034 134,057 27,395 23,656 Mortgage and other private loans 835,893 1,238,952 27,285 8,174 Total 903,927 1,373,009 157,859 31,830 Loans to legal entities Finance lease receivables 77,505 209,412 8,206 7,452 Investment loan, overdraft facility and other business loans 960,673 2,324,542 25,342 16,752 Total 1,038,178 2,533,954 33,548 24,204 The loan risk level is also expressed by the market value of the collateral relative to the loan amount, i.e. the LTV (loan to value) ratio. The financial impact of the collateral is important for loans and receivables that are unlikely to be serviced by the customer’s primary cash flows, which is evidenced in stage 3 customers. 31.12.2024 Over-collateralised loans Under-collateralised loans Gross carrying amount Fair value of the collateral Gross carrying amount Fair value of the collateral Loans to private individuals Consumer loans 0 0 108,146 0 Finance lease receivables 93,563 148,636 2,340 752 Mortgage and other private loans 716,409 1,678,131 11,442 3,988 Total 809,972 1,826,767 121,928 4,740 Loans to legal entities Finance lease receivables 96,877 200,645 1,946 1,330 Investment loan, overdraft facility and other business loans 744,475 4,670,017 17,471 10,473 Total 841,352 4,870,662 19,417 11,803
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 79 The breakdown of the non-performing (stage 3) over and under-collateralised loans are given in the tables below. 31.12.2025 Over-collateralised loans Under-collateralised loans Gross carrying amount Fair value of the collateral Gross carrying amount Fair value of the collateral Loans to private individuals Consumer loans 0 0 2,010 0 Finance lease receivables 82 183 133 100 Mortgage and other private loans 3,374 6,232 760 295 Total 3,456 6,415 2,903 395 Loans to legal entities Finance lease receivables 454 1,782 0 0 Investment loan, overdraft facility and other business loans 5,143 14,056 2,062 1,428 Total 5,597 15,838 2,062 1,428 31.12.2024 Over-collateralised loans Under-collateralised loans Gross carrying amount Fair value of the collateral Gross carrying amount Fair value of the collateral Loans to private individuals Consumer loans 0 0 2,161 0 Finance lease receivables 137 318 2 0 Mortgage and other private loans 3,542 11,589 296 9 Total 3,679 11,907 2,459 9 Loans to legal entities Finance lease receivables 766 2,650 1 0 Investment loan, overdraft facility and other business loans 7,156 30,379 761 678 Total 7,922 33,029 762 678 Loans and advances to customers by types of collateral Private individuals 31.12.2025 31.12.2024 Loans secured by mortgage 841,449 718,770 Leased assets 95,274 95,688 Unsecured loans 120,730 114,878 Personal sureties, guarantees 3,986 2,258 Other 347 306 Total 1,061,786 931,900 Loss allowance -7,185 -6,895 Total of net loans 1,054,601 925,005 Legal entities 31.12.2025 31.12.2024 Loans secured by mortgage 859,219 673,195 Leased assets 104,832 98,823 Unsecured loans 434 591 Personal sureties, guarantees 4,671 5,088 Other 102,569 83,072 Total 1,071,725 860,769 Loss allowance -12,236 -11,656
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 80 Total of net loans 1,059,489 849,113 Impairment losses on financial assets Loan allowances during the reporting period are impacted by various factors: ● Movements between stages 1, 2 and 3 due to significant increase (or decrease) in the credit risk of a financial instrument or due to default, followed by moving from a 12 -month to a lifetime expected credit loss model (or vice versa); ● Impairment allowance on new financial instruments recognised in the reporting period, as well as decrease in impairment due to derecognition; ● Regular review of risk parameters and resulting changes in ECL due to changes in probability of default (PD), exposure at default (EAD) and loss given default (LGD); ● Effects of model and assumption changes on the ECL model; ● The effect of discounting on the ECL model as the ECL is measured at present value; ● Loans and related write-downs written off during the reporting period.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 81 The following table analyses the movement of allowances and gross carrying values between stages during the reporting per iod. Net impact from movements between stages is included in the line “Recalculations of allowances”. * Stage 3 in this table includes solely repurchased credit impaired loans (POCI). Once classified as POCI a loan remains in POCI category until derecognition ECL Gross carrying amount 2024 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -6,820 -5,516 -4,058 -16,394 1,427,290 67,632 12,345 1,507,267 Transfer to stage 1 -2,843 2,629 214 0 23,724 -22,847 -877 0 Transfer to stage 2 126 -560 434 0 -18,103 19,756 -1,653 0 Transfer to stage 3 76 274 -350 0 -6,224 -3,544 9,768 0 Recalculations of allowances 1,787 -2,639 -3,435 -4,287 0 0 0 0 Derecognised and repaid 522 648 865 2,035 -224,947 -11,463 -3,132 -239,542 Originated or purchased* -2,558 -109 -12 -2,679 524,222 4,871 43 529,136 Total net P&L charge during the period -2,890 243 -2,284 -4,931 298,672 -13,227 4,149 289,594 Other movements with no P&L impact Write-offs 64 86 53 203 -64 -86 -57 -207 Assignments 76 1236 1259 2571 -345 -2025 -1615 -3,985 Balance as at 31.12.2024 -9,570 -3,951 -5,030 -18,551 1,725,553 52,294 14,822 1,792,669 ECL Gross carrying amount 2025 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -9,570 -3,951 -5,030 -18,551 1,725,553 52,294 14,822 1,792,669 Transfer to stage 1 -960 769 191 0 15,512 -15,004 -508 0 Transfer to stage 2 671 -829 158 0 -28,887 29,445 -558 0 Transfer to stage 3 79 708 -787 0 -16,793 -4,926 21,719 0 Recalculations of allowances 1,751 -292 -2,116 -657 0 0 0 0 Derecognised and repaid 821 498 1,283 2,602 -219,373 -11,454 -21,619 -252,446 Originated or purchased* -3,735 -688 -609 -5,032 589,644 5,299 1,803 596,746 Total net P&L charge during the period -1,373 166 -1,880 -3,087 340,103 3,360 837 344,300 Other movements with no P&L impact Write-offs 21 21 231 273 -15 -42 -264 -321 Assignments 68 567 1309 1944 -223 -1537 -1376 -3,136 Balance as at 31.12.2025 -10,854 -3,197 -5,370 -19,421 2,065,418 54,075 14,019 2,133,512
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 82 The following tables analyses the movement of allowances and gross carrying values during the reporting period by product. ECL Gross carrying amount Consumer loans 2025 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -1,909 -1,148 -1,860 -4,917 101,672 4,313 2,161 108,146 Reclassification in operating segment 69 15 78 162 -9,987 -142 -82 -10,211 Transfer to stage 1 -424 347 77 0 1,390 -1,305 -85 0 Transfer to stage 2 118 -185 67 0 -3,621 3,700 -79 0 Transfer to stage 3 34 252 -286 0 -1,000 -886 1,886 0 Recalculations of allowances 1,271 -950 -1,150 -829 0 0 0 0 Derecognised and repaid 297 231 124 652 -31,990 -1,515 -648 -34,153 Originated or purchased -967 -660 -56 -1,683 39,074 3,032 232 42,338 Total net P&L charge during the period 329 -965 -1,224 -1,860 3,853 3,026 1,306 8,185 Other movements with no P&L impact Write-offs 0 0 0 0 0 0 0 0 Assignments 6 537 1,308 1,851 -91 -1,475 -1,375 -2,941 Balance as at 31.12.2025 -1,505 -1,561 -1,698 -4,764 95,447 5,722 2,010 103,179 ECL Gross carrying amount Consumer loans 2024 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -1,960 -1,080 -1,604 -4,644 93,695 4,449 1,919 100,063 Transfer to stage 1 -256 244 12 0 1,060 -1,038 -22 0 Transfer to stage 2 68 -79 11 0 -1,955 1,976 -21 0 Transfer to stage 3 23 132 -155 0 -909 -1,032 1,941 0 Recalculations of allowances 948 -2,046 -1,591 -2,689 0 0 0 0 Derecognised and repaid 165 445 208 818 -33,518 -279 -41 -33,838 Originated or purchased -973 0 0 -973 43,644 2,262 0 45,906 Total net P&L charge during the period -25 -1,304 -1,515 -2,844 8,322 1,889 1,857 12,068 Other movements with no P&L impact Write-offs 0 0 0 0 0 0 0 0 Assignments 76 1,236 1,259 2,571 -345 -2,025 -1,615 -3,985 Balance as at 31.12.2024 -1,909 -1,148 -1,860 -4,917 101,672 4,313 2,161 108,146
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 83 ECL Gross carrying amount Finance lease receivables to private individuals 2025 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -127 -9 -28 -164 94,222 1,542 139 95,903 Transfer to stage 1 -11 3 8 0 473 -433 -40 0 Transfer to stage 2 1 -9 8 0 -1,221 1,259 -38 0 Transfer to stage 3 0 2 -2 0 -183 -235 418 0 Recalculations of allowances 47 -5 -47 -5 0 0 0 0 Derecognised and repaid 14 1 15 30 -25,218 -671 -238 -26,127 Originated or purchased -38 -1 -1 -40 25,604 74 5 25,683 Total net P&L charge during the period 13 -9 -19 -15 -545 -6 107 -444 Other movements with no P&L impact Write-offs 0 0 3 3 0 0 -30 -30 Assignments 0 0 0 0 0 0 0 0 Balance as at 31.12.2025 -114 -18 -44 -176 93,677 1,536 216 95,429 ECL Gross carrying amount Finance lease receivables to private individuals 2024 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -100 -6 -14 -120 71,725 1,125 70 72,920 Transfer to stage 1 -5 1 4 0 153 -131 -22 0 Transfer to stage 2 2 -6 4 0 -1,175 1,193 -18 0 Transfer to stage 3 0 0 0 0 -66 -102 168 0 Recalculations of allowances 20 0 -51 -31 0 0 0 0 Derecognised and repaid 17 2 12 31 -23,250 -560 -42 -23,852 Originated or purchased -67 0 0 -67 46,841 17 0 46,858 Total net P&L charge during the period -33 -3 -31 -67 22,503 417 86 23,006 Other movements with no P&L impact Write-offs 6 0 17 23 -6 0 -17 -23 Assignments 0 0 0 0 0 0 0 0 Balance as at 31.12.2024 -127 -9 -28 -164 94,222 1,542 139 95,903
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 84 ECL Gross carrying amount Mortgage and other private loans 2025 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -338 -765 -711 -1814 701,459 22,554 3,838 727,851 Reclassification in operating segment -69 -15 -78 -162 9,987 142 82 10,211 Transfer to stage 1 -375 353 22 0 10,111 -9,951 -160 0 Transfer to stage 2 12 -45 33 0 -13,886 14,173 -287 0 Transfer to stage 3 3 25 -28 0 -1,065 -729 1,794 0 Recalculations of allowances -74 -40 -490 -604 0 0 0 0 Derecognised and repaid 27 84 159 270 -64,763 -2,833 -1,093 -68,689 Originated or purchased -234 -24 -3 -261 192,368 1,710 89 194,167 Total net P&L charge during the period -641 353 -307 -595 122,765 2,370 343 125,478 Other movements with no P&L impact Write-offs 21 21 191 233 -15 -24 -128 -167 Assignments 62 30 1 93 -132 -62 -1 -195 Balance as at 31.12.2025 -965 -376 -904 -2245 834,064 24,980 4,134 863,178 ECL Gross carrying amount Mortgage and other private loans 2024 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -274 -511 -522 -1307 584,492 16,025 2,583 603,100 Transfer to stage 1 -197 42 155 0 1,642 -1,188 -454 0 Transfer to stage 2 5 -26 21 0 -9,662 9,795 -133 0 Transfer to stage 3 2 38 -40 0 -1,271 -716 1,987 0 Recalculations of allowances 112 -454 -451 -793 0 0 0 0 Derecognised and repaid 20 73 110 203 -57,377 -1,496 -124 -58,997 Originated or purchased -64 -1 -1 -66 183,693 208 0 183,901 Total net P&L charge during the period -122 -328 -206 -656 117,025 6,603 1,276 124,904 Other movements with no P&L impact Write-offs 58 74 17 149 -58 -74 -21 -153 Assignments 0 0 0 0 0 0 0 0 Balance as at 31.12.2024 -338 -765 -711 -1814 701,459 22,554 3,838 727,851
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 85 ECL Gross carrying amount Finance lease receivables to legal entities 2025 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -415 -54 -246 -715 94,987 3,069 767 98,823 Reclassification in operating segment 96 2 154 252 -15,957 -225 -419 -16,601 Transfer to stage 1 -7 6 1 0 246 -242 -4 0 Transfer to stage 2 12 -22 10 0 -2,288 2,336 -48 0 Transfer to stage 3 34 8 -42 0 -13,515 -352 13,867 0 Recalculations of allowances 52 -29 -63 -40 0 0 0 0 Derecognised and repaid 46 11 35 92 -16,948 -1,750 -13,690 -32,388 Originated or purchased -207 0 -1 -208 35,751 163 87 36,001 Total net P&L charge during the period -70 -26 -60 -156 3,246 155 212 3,613 Other movements with no P&L impact Write-offs 0 0 37 37 0 -18 -106 -124 Assignments 0 0 0 0 0 0 0 0 Balance as at 31.12.2025 -389 -78 -115 -582 82,276 2,981 454 85,711 ECL Gross carrying amount Finance lease receivables to legal entities 2024 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12 month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -421 -103 -108 -632 95,457 2,278 660 98,395 Transfer to stage 1 -11 10 1 0 295 -284 -11 0 Transfer to stage 2 11 -18 7 0 -2,462 2,531 -69 0 Transfer to stage 3 2 67 -69 0 -298 -596 894 0 Recalculations of allowances 194 28 -387 -165 0 0 0 0 Derecognised and repaid 62 8 293 363 -38,655 -967 -690 -40,312 Originated or purchased -252 -58 0 -310 40,650 119 0 40,769 Total net P&L charge during the period 6 37 -155 -112 -470 803 124 457 Other movements with no P&L impact Write-offs 0 12 17 29 0 -12 -17 -29 Assignments 0 0 0 0 0 0 0 0 Balance as at 31.12.2024 -415 -54 -246 -715 94,987 3,069 767 98,823
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 86 ECL Gross carrying amount Investment loan, overdraft facility and other business loans 2025 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -6,781 -1,975 -2,185 -10,941 733,213 20,816 7,917 761,946 Reclassification in operating segment -96 -2 -154 -252 15,957 225 419 16,601 Transfer to stage 1 -143 60 83 0 3,292 -3,073 -219 0 Transfer to stage 2 528 -568 40 0 -7,871 7,977 -106 0 Transfer to stage 3 8 421 -429 0 -1,030 -2,724 3,754 0 Recalculations of allowances 455 732 -366 821 0 0 0 0 Derecognised and repaid 437 171 950 1,558 -80,454 -4,685 -5,950 -91,089 Originated or purchased -2,289 -3 -548 -2,840 296,847 320 1,390 298,557 Total net P&L charge during the period -1004 813 -270 -461 210,784 -2,185 -1,131 207,468 Other movements with no P&L impact Write-offs 0 0 0 0 0 0 0 0 Assignments 0 0 0 0 0 0 0 0 Balance as at 31.12.2025 -7,881 -1,164 -2,609 -11,654 959,954 18,856 7,205 986,015 ECL Gross carrying amount Investment loan, overdraft facility and other business loans 2024 Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -4,065 -3,816 -1,810 -9,691 581,921 43,755 7,113 632,789 Transfer to stage 1 -2,374 2,332 42 0 20,574 -20,206 -368 0 Transfer to stage 2 40 -431 391 0 -2,849 4,261 -1,412 0 Transfer to stage 3 49 37 -86 0 -3,680 -1,098 4,778 0 Recalculations of allowances 513 -167 -955 -609 0 0 0 0 Derecognised and repaid 258 120 242 620 -72,147 -8,161 -2,235 -82,543 Originated or purchased -1,202 -50 -11 -1,263 209,394 2,265 43 211,702 Total net P&L charge during the period -2716 1,841 -377 -1,252 151,292 -22,939 806 129,159 Other movements with no P&L impact Write-offs 0 0 2 2 0 0 -2 -2 Assignments 0 0 0 0 0 0 0 0 Balance as at 31.12.2024 -6,781 -1,975 -2,185 -10,941 733,213 20,816 7,917 761,946
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 87 The following tables analyse the movements of allowances and gross carrying values of off-balance sheet loan commitments and financial guarantees during the reporting period. 2025 ECL Gross carrying amount Off-balance exposures of credit lines and overdraft facilities Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -421 -33 -4 -458 133,090 Transfer to stage 1 -31 31 0 0 0 Transfer to stage 2 2 -2 0 0 0 Transfer to stage 3 0 0 0 0 0 Recalculations of allowances 80 -8 0 72 0 Derecognised and repaid 114 2 0 116 -56,755 Originated or purchased -507 0 0 -507 136,506 Total net P&L charge during the period -342 23 0 -319 79,751 Balance as at 31.12.2025 -763 -10 -4 -777 212,841 2024 ECL Gross carrying amount Off-balance exposures of credit lines and overdraft facilities Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -352 -83 -2 -437 128,491 Transfer to stage 1 -64 64 0 0 0 Transfer to stage 2 10 -10 0 0 0 Transfer to stage 3 0 0 0 0 0 Recalculations of allowances 45 -21 -3 21 0 Derecognised and repaid 233 18 1 252 -72,061 Originated or purchased -293 -1 0 -294 76,660 Total net P&L charge during the period -69 50 -2 -21 4,599 Balance as at 31.12.2024 -421 -33 -4 -458 133,090
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 88 2025 ECL Gross carrying amount Off-balance exposures of financial guarantees Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2025 -23 -1 -1 -25 18,498 Transfer to stage 1 0 0 0 0 Transfer to stage 2 1 -1 0 0 0 Transfer to stage 3 0 0 0 0 0 Recalculations of allowances 3 -1 -1 1 0 Derecognised and repaid 8 0 2 10 -5,255 Originated or purchased -37 0 0 -37 16,296 Total net P&L charge during the period -25 -2 1 -26 11,041 Balance as at 31.12.2025 -48 -3 0 -51 29,539 2024 ECL Gross carrying amount Off-balance exposures of financial guarantees Stage 1 (12month ECL) Stage 2 (lifetime ECL) Stage 3 (lifetime ECL) Total Balance as at 01.01.2024 -19 -5 0 -24 16,292 Transfer to stage 1 -3 3 0 0 0 Transfer to stage 2 0 0 0 0 0 Transfer to stage 3 0 0 0 0 0 Recalculations of allowances 3 -1 -1 1 0 Derecognised and repaid 13 3 0 16 -9,191 Originated or purchased -17 -1 0 -18 11,397 Total net P&L charge during the period -4 4 -1 -1 2,206 Balance as at 31.12.2024 -23 -1 -1 -25 18,498 Write-offs of financial assets The write-off of the receivables, i.e. the removal of the financial asset from the statement of financial position, occurs in part or in full when the Group has implemented all possible recovery measures and it has been concluded that there is no reasonable expectation of furt her recoveries. The write -off indicator may be the termination of the recovery procedure or, in the case of a secured loan, the realisation of the collateral, but the proceeds from the disposal have not been sufficient to cover the carrying amount of the receivable. Termination of the recovery procedure may be conditional on the death of the client, bankruptcy, criminal proceedings or a court-approved debt restructuring plan, under which the receivable is reduced.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 89 Modification of financial assets The Group may renegotiate loans and modify contractual terms. In order to modify financial assets, loan agreements are restructured either due to commercial negotiations or payment difficulties, during which the payment term is extended, payment holidays o r other restructuring measures are granted. Restructuring practices are based on management estimates that payments by the customer are expected to continue. The Group monitors the subsequent operation of the modified assets. The Group may decide that, af ter the restructuring, the credit risk has significantly improved so that the assets are moved from Stage 3 to Stage 2 or Stage 1. For the claim to be reclassified, a minimum of 12 months of verified and consistently compliant payment behavior must be established. Concentration of risks The Group adheres to the principle of diversification of credit risk according to economic sector, geographical area, product and counterparties. A summary of exposures by economic sector and geographical areas has been provided in the tables below. In economic sector K, cash balances and other deposits are in the amount of 488,717 (31.12.2024: 343,678) in thousands of euros and debt securities are in the amount of 3, 934 (31.12.2024: 3,489) in thousands of euros. In other sectors, debt securities are in the amount of 59 ,089 (31.12.2024: 34,262) in thousands of euros and other financial assets are in the amount of 741 (31.12.2024: 1,610) in thousands of euros. The lending activity of the Group is focused on providing financing to the local market. 50% of loans and advances to customers are granted to private individuals (31.12.2024: 52%). The portfolio of loans granted to legal entities is diversified between various economic sectors to avoid high levels of concentration. The distribution of loans and advances to customers according to credit product is provided in Note 11. Loans and advances to customers by economic sector Stage 1 Stage 2 Stage 3 Loss allowance 31.12.2025 % Private individuals 1,023,188 32,238 6,360 -7,185 1,054,601 49.88% L – activities related to real estate 460,483 8,971 1,597 -4,888 466,163 22.05% C – manufacturing 96,624 3,336 1,050 -1,301 99,709 4.72% G – wholesale and retail 97,248 2,365 1,439 -1,915 99,137 4.69% K – finance and insurance activities 92,758 0 0 -610 92,148 4.36% F – construction 68,307 412 1,201 -704 69,216 3.27% D – power and heat generation 50,687 0 0 -481 50,206 2.37% H – transportation and storage 37,992 133 122 -325 37,922 1.79% M - professional, scientific and technical activities 28,017 3,307 0 -518 30,806 1.46% N – administrative and support services 26,581 395 13 -169 26,820 1.27% A – agriculture, forestry and fishing 23,576 1,446 1,296 -569 25,749 1.22% I – hospitality and food service 16,798 562 844 -421 17,783 0.84% S – other services 2,732 116 0 -15 2,833 0.13% Other 40,426 795 97 -320 40,998 1.94% Total 2,065,417 54,076 14,019 -19,421 2,114,091 100.00%
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 90 Loans and advances to customers by economic sector Stage 1 Stage 2 Stage 3 Loss allowance 31.12.2024 % Private individuals 897,353 28,409 6,138 -6,895 925,005 52.14% L – activities related to real estate 370,672 12,658 291 -5,211 378,410 21.33% G – wholesale and retail 103,540 4,067 1,670 -1,712 107,565 6.06% C – manufacturing 73,789 1,325 1,347 -988 75,473 4.25% K – finance and insurance activities 66,147 0 0 -374 65,773 3.71% D – power and heat generation 44,884 0 2,126 -984 46,026 2.59% F – construction 33,558 1,353 75 -331 34,655 1.95% H – transportation and storage 32,617 257 253 -331 32,796 1.85% M - professional, scientific and technical activities 31,302 69 0 -613 30,758 1.73% A – agriculture, forestry and fishing 18,370 3,075 2,179 -504 23,120 1.30% N – administrative and support services 12,682 198 20 -92 12,808 0.72% I – hospitality and food service 6,521 519 341 -181 7,200 0.41% S – other services 3,268 236 0 -15 3,489 0.20% Other 30,851 127 382 -320 31,040 1.75% Total 1,725,554 52,293 14,822 -18,551 1,774,118 100.00% Financial assets by geographical classification 31.12.2025 EE FR LT CH LV Other Total Cash, cash balances at central banks and other deposits 467,360 20,052 0 0 2 1,303 488,717 Debt securities at fair value through other comprehensive income 14,681 0 23,670 0 16,680 3,004 58,035 Debt securities at amortized cost 4,988 0 0 0 0 0 4,988 Loans and advances to customers 2,099,170 0 0 12,645 0 2,276 2,114,091 Equity instruments at fair value through other comprehensive income 0 0 0 0 0 13 13 Derivatives 0 0 0 0 0 3,681 3,681 Other financial assets 741 0 0 0 0 0 741 Total 2,586,940 20,052 23,670 12,645 16,682 10,277 2,670,266 31.12.2024 EE FR LT CH LV Other Total Cash, cash balances at central banks and other deposits 320,511 19,638 0 0 1 3,528 343,678 Debt securities at fair value through other comprehensive income 4,944 0 18,572 0 11,264 2,971 37,751 Loans and advances to customers 1,760,087 0 0 12,177 35 1,819 1,774,118 Equity instruments at fair value through other comprehensive income 0 0 0 0 0 13 13 Other financial assets 1,610 0 0 0 0 1,610 Total 2,087,152 19,638 18,572 12,177 11,300 8,331 2,157,170
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 91 Liquidity risk management Liquidity risk is defined as the risk of insufficient solvency on behalf of Coop Pank to perform its contractual obligations on a timely basis - i.e. the bank’s failure to finance various assets in a timely and sustainable manner, or to liquidate its positions in order to perform contractual obligations. Liquidity risk is managed based on the liquidity management policy. The objective of liquidity management in Coop Pank is to guarantee, at any given moment, the timely and complete performance of the obligations assumed by the Group while optimising the liquidity risk in such a manner as to achieve maximum and stable profitability on investments with differen t maturities. The Bank’s main liquidity management body is the Assets and Liabilities Committee (ALCO). The functions and areas of responsibility of ALCO in the management of liquidity are: ● to plan short-term and long-term liquidity of the Group, and to design and implement the measures to be used; ● to analyse and summarise information concerning the Group’s assets and liabilities, interest income and expenses, management of liquidity and investments, and, if necessary, to prepare the adoption of strategic decisions by the Board; ● to optimise the ratio of the maturities, profitability and instruments of the Group's assets and liabilities in order to achieve the bank’s strategic objectives; ● to regulate the Group’s required liquidity level as well the level of the risk of change in the acceptable interest rate risk and the acceptable value of assets and liabilities. The following bodies are regularly informed of the bank’s liquidity position: the Management Board, the Council, ALCO and the Credit Committee. The bank maintains a sufficient level of liquidity in order to ensure timely performance of its obligations. Coop Pank group uses an approach based on the analysis of the duration gap between the maturities of assets and liabilities for the management of Coop Pank group's liquidity position. An overview of the division of assets and liabilities by maturities has been provided in the following table. Limits have been established for all major liquidity indicators. The following indicators are used for the measurement of liquidity risk: ● Liquidity Coverage Ratio (LCR); ● maintenance period in a liquidity crisis situation; ● financing concentration; ● ratio of liquid assets to demand deposits; ● ratio of non-current liabilities to investments requiring stable funding. The Group's total duration gap in the period of up to 12 months is negative. This indicates that the Group has more liabilities with a duration of up to 12 months compared to receivables with the corresponding duration. The management of the duration gap risk is based on estimates concerning forecast cash flows arising from liabilities – demand deposits are usually a rather stable source of funding and up to 12 -month term deposits are often prolonged – therefore the behavioural nature of these deposits is longer than 12 months. The Group ensures an adequate amount of liquidity buffers in order to meet the net outflow of liabilities as they become due. The liquidity policy of the Group is built upon the principle of prudence and established liquidity buffers are sufficient to cover even a large-scale outflow of deposits. The Group has established a business continuity and recovery plan for conduct in a liquidity crisis, specifying the actions to be taken for covering a cash flow deficit even in extraordinary circumstances. An overview of the Group's financial assets and financial liabilities by residual maturity (undiscounted cash flows) is provided in the following table.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 92 31.12.2025 Up to 3 months 3-12 months 1-5 years Over 5 years Total Assets Cash, cash balances at central banks and other deposits 488,717 0 0 0 488,717 Debt securities at fair value through other comprehensive income 53 6,227 33,850 25,899 66,029 Debt securities at amortized cost 95 303 6,008 0 6,406 Loans and advances to customers 102,754 343,908 1,273,290 1,105,113 2,825,065 Equity instruments at fair value through other comprehensive income 0 0 0 13 13 Derivatives 3,827 -2,681 5,162 0 6,308 incl. inflows 6,450 0 18,420 0 24,870 incl. outflows -2,623 -2,681 -13,258 0 -18,561 Other financial assets 700 38 0 3 741 Total financial assets 596,146 347,795 1,318,310 1,131,028 3,393,279 Liabilities Customer deposits 1,239,093 786,943 33,873 358 2,060,267 Loans received 72,718 1,511 2,969 77,198 Debt securities 7,791 0 272,519 0 280,310 Lease liabilities 260 778 3,894 287 5,219 Other financial liabilities 13,230 0 0 0 13,230 Subordinated debt 11,003 3,458 58,271 0 72,732 Total financial liabilities 1,344,095 792,690 371,526 645 2,508,956 Off-balance sheet liabilities Undrawn lines of credit and overdraft facilities 212,841 0 0 0 212,841 Financial guarantees by contractual amounts 29,539 0 0 0 29,539 Total on-balance-sheet and off-balance-sheet liabilities 1,586,475 792,690 371,526 645 2,751,336 Duration gap of financial assets and financial liabilities -990,329 -444,895 946,784 1,130,383 641,943 31.12.2024 Up to 3 months 3-12 months 1-5 years Over 5 years Total Assets Cash, cash balances at central banks and other deposits 343,678 0 0 0 343,678 Debt securities at fair value through other comprehensive income 905 6,136 32,716 2,553 42,310 Loans and advances to customers 83,105 296,754 1,124,704 1,026,390 2,530,953 Equity instruments at fair value through other comprehensive income 0 0 0 13 13 Other financial assets 1,590 20 0 0 1,610 Total financial assets 429,278 302,910 1,157,420 1,028,956 2,918,564 Liabilities Customer deposits 996,901 808,010 86,623 1,756 1,893,290 Loans received 62 721 6,331 1,333 8,447 Lease liabilities 248 744 3,866 1,119 5,977 Other financial liabilities 15,443 0 0 0 15,443 Subordinated debt 1,240 3,732 14,017 68,515 87,504 Total financial liabilities 1,013,894 813,207 110,837 72,723 2,010,661 Off-balance sheet liabilities Undrawn lines of credit and overdraft facilities 133,090 0 0 0 133,090 Financial guarantees by contractual amounts 18,498 0 0 0 18,498 Total on-balance-sheet and off-balance-sheet liabilities 1,165,482 813,207 110,837 72,723 2,162,249 Duration gap of financial assets and financial liabilities -736,204 -510,297 1,046,583 956,233 756,315
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 93 * As of 31.12.2025 and 31.12.2024 28,100 thousand euros of principal amount of subordinated perpetual bonds (Tier 1) is included in this maturity bucket. Presented in Note 19. **Undiscounted cash flows as at 31 December 2024 have been updated compared to those disclosed in the 2024 report by the amount of interest. The following table provides information on assets and liabilities, presented in order of their liquidity: Liquidity gap 31.12.2025 31.12.2024 Within 12 months After 12 months Total Within 12 months After 12 months Total Assets Cash, cash balances at central banks and other deposits 488,71 7 0 488,717 343,678 0 343,678 Debt securities at fair value through other comprehensive income 5,121 52,914 58,035 5,487 32,264 37,751 Debt securities at amortized cost 0 4,988 4,988 0 0 0 Loans and advances to customers 325,567 1,788,524 2,114,091 261,346 1,512,772 1,774,118 Equity instruments at fair value through other comprehensive income 0 13 13 0 13 13 Derivatives 3,681 0 3,681 0 0 0 incl. inflows 5,138 0 5,138 0 0 0 incl. outflows -1,457 0 -1,457 0 0 0 Other financial assets 738 3 741 1,610 0 1,610 Other assets 1,718 0 1,718 2,035 0 2,035 Assets held for sale 1,256 0 1,256 1,140 0 1,140 Right-of-use assets 0 4,736 4,736 0 5,107 5,107 Tangible assets 0 3,539 3,539 0 3,451 3,451 Intangible assets 0 14,722 14,722 0 12,954 12,954 Goodwill 0 6,757 6,757 0 6,757 6,757 Total assets 826,798 1,876,196 2,702,994 615,296 1,573,318 2,188,614 Liabilities Customer deposits 2,014,216 33,243 2,047,459 1,792,439 85,426 1,877,865 Loans received 74,124 2,937 77,061 693 7,587 8,280 Debt securities 6,121 249,082 255,203 0 0 0 Lease liabilities 883 3,883 4,766 875 4,278 5,153 Other financial liabilities 13,230 0 13,230 15,443 0 15,443 Subordinated debt 10,048 53,100 63,148 48 63,100 63,148 Other liabilities 5,986 1,598 7,584 7,088 0 7,088 Total liabilities 2,124,608 343,843 2,468,451 1,816,586 160,391 1,976,977
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 94 Market risk management Market risk arises from the Group’s trading and investment activities in the interest, currency and equity markets, as well as from mismatches between the currencies or interest rates of assets and liabilities . Market risk arises from changes in interest rates, currency exchange rates and prices of financial assets. The acceptance of market risk is controlled by using risk limits. Different factors influencing market risks are monitored on a daily basis. Interest rate and foreign exchange risks are monitored and managed on a Group level, taking into account the impact of all assets and liabilities. In 2025, the Bank implemented an interest rate swap to hedge the interest rate risk arising from a long-term fixed-rate covered bond. The Bank takes into account the combined effect of the covered bond and the interest rate swap in the Group’s overall interest rate risk calculation, and additionally monitors separately the effectiveness of the hedge between the covered bond and the interest rate swap. Market risk arising from the investments in debt securities is monitored separately . The volume of the debt securities portfolio increased in total in 2025, a more detailed overview is given in Note 10. The average maturity of the portfolio has decreased . The market risk of the portfolio of debt securities is mainly caused by the maturity date and possible change in interest rates. The interest rate sensitivity of the financial investments portfolio is calculated regularly. The sensitivity of the debt securities portfolio given a 100 bp increase in interest rates as at 31.12.2025 was -5,046 (31.12.2024: -1,153) thousand euros. Currency risk is defined defined as a risk arising from the differences in the currency structure of the Group's assets and liabilities. Changes in currency exchange rates cause changes in the value of assets and liabilities, as well as the amount of income and expenses measured i n the functional currency. The Group generally maintains minimum foreign currency positions required for the provision of services to customers. All foreign currency positions are continually monitored and marked to market. The tot al amount of open currency positions in the consolidated statement of financial position as at 31.12.2025 was 198 (31.12.2024: 162) thousand euros. The sensitivity analysis has been carried out with the justified effects of possible exchange rate changes (5% on average) on the statement of profit or loss remaining constant for all other variables, the impact amount is 9 (31.12.2024: 12) thousand euros.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 95 Data on the structure of assets and liabilities by currency positions and respective net currency positions have been presented in the following table. 31.12.2025 EUR USD SEK Other Total Assets Cash, cash balances at central banks and other deposits 486,857 915 779 166 488,717 Debt securities at fair value through other comprehensive income 58,035 0 0 0 58,035 Debt securities at amortized cost 4,988 0 0 0 4,988 Loans and advances to customers 2,114,091 0 0 0 2,114,091 Equity instruments at fair value through other comprehensive income 13 0 0 0 13 Derivatives 3,681 0 0 0 3,681 Other financial assets 741 0 0 0 741 Total financial assets 2,668,406 915 779 166 2,670,266 Liabilities Customer deposits 2,045,833 844 688 94 2,047,459 Loans received 77,061 0 0 0 77,061 Subordinated debt 63,148 0 0 0 63,148 Debt securities 255,203 0 0 0 255,203 Lease liabilities 4,766 0 0 0 4,766 Other financial liabilities 13,194 22 5 9 13,230 Total financial liabilities 2,459,205 866 693 103 2,460,867 Net position 209,201 49 86 63 209,399 31.12.2024 EUR USD SEK Other Total Assets Cash, cash balances at central banks and other deposits 339,301 1,035 3,119 223 343,678 Debt securities at fair value through other comprehensive income 37,751 0 0 0 37,751 Loans and advances to customers 1,774,118 0 0 0 1,774,118 Equity instruments at fair value through other comprehensive income 13 0 0 0 13 Other financial assets 1,610 0 0 0 1,610 Total financial assets 2,152,793 1,035 3,119 223 2,157,170 Liabilities 2,157,170 Customer deposits 1,875,179 1,008 1,528 150 1,877,865 Loans received 8,280 0 0 0 8,280 Subordinated debt 63,148 0 0 0 63,148 Lease liabilities 5,153 0 0 0 5,153 Other financial liabilities 13,914 25 1,504 0 15,443 Total financial liabilities 1,965,674 1,033 3,032 150 1,969,889 Net position 187,119 2 87 73 187,281 Interest rate risk is defined as a risk of unexpected unfavourable changes in interest rates that might affect the revenue generated by the Group. The Group is exposed to interest rate risk if the due payment dates of its main assets and liabilities are different, if the structure of assets and liabilities varies in different currencies or if the interest rates of assets and liabilities can be adjusted at different time intervals. The volume of floating rate loans that are EURIBOR -related as of 31.12.2025 was 1,922,148 (31.12.2024: 1,601,539) in thousands of euros. The Group has no loans related with other benchmarks.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 96 Interest-bearing financial assets and financial liabilities by next interest rate repricing period 31.12.2025 Up to 3 months 3-12 months 1-5 years Over 5 years Principal Accrued interest Loss allowance Total Financial assets exposed to interest rate risk Balances with central banks 462,301 0 0 0 462,301 0 0 462,301 Loans and advances to credit institutions 22,128 0 0 0 22,128 0 0 22,128 Debt securities at fair value through other comprehensive income 0 2,826 27,931 26,694 57,451 605 -21 58,035 Debt securities at amortized cost 0 0 4,535 472 5,007 4 -23 4,988 Loans and advances to customers 1,134,320 991,357 846 0 2,126,523 6,989 -19,421 2,114,091 Derivatives 0 0 3,681 0 3,681 0 0 3,681 Total financial assets exposed to interest rate risk 1,618,749 994,183 36,993 27,166 2,677,091 7,598 -19,465 2,665,224 Financial liabilities exposed to interest rate risk Customer deposits 1,231,349 769,284 29,492 5,328 2,035,453 12,006 0 2,047,459 Loans received 72,000 848 4,158 0 77,006 55 0 77,061 Debt securities 6,122 0 249,081 0 255,203 0 0 255,203 Subordinated debt 0 15,000 0 48,100 63,100 48 0 63,148 Total financial liabilities exposed to interest rate risk 1,309,471 785,132 282,731 53,428 2,430,762 12,109 0 2,442,871 Exposure to interest rate risk duration gap 309,278 209,051 -245,738 -26,262 246,329 -4,511 -19,465 222,353 31.12.2024 Up to 3 months 3-12 months 1-5 years Over 5 years Principal Accrued interest Loss allowance Total Financial assets exposed to interest rate risk Balances with central banks 317,696 0 0 0 317,696 0 0 317,696 Loans and advances to credit institutions 24,214 0 0 0 24,214 0 0 24,214 Debt securities at fair value through other comprehensive income 500 4,958 29,144 2,781 37,383 368 0 37,751 Loans and advances to customers 926,977 857,713 1,045 0 1,785,735 6,934 -18,551 1,774,118 Total financial assets exposed to interest rate risk 1,269,387 862,671 30,189 2,781 2,165,028 7,302 -18,551 2,153,779 Financial liabilities exposed to interest rate risk Customer deposits 996,311 785,507 74,562 6,103 1,862,483 15,382 0 1,877,865 Loans received 0 662 6,253 1,333 8,248 32 8,280 Subordinated debt 0 15,000 0 48,100 63,100 48 0 63,148 Total financial liabilities exposed to interest rate risk 996,311 801,169 80,815 55,536 1,933,831 15,462 0 1,949,293 Exposure to interest rate risk duration gap 273,076 61,502 -50,626 -52,755 231,197 -8,160 -18,551 204,486
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 97 Interest rate risk management entails the analysis of the interest rate risk of all the Group’s assets and liabilities and the management of duration. The bank measures interest rate risk daily according to the European Commission Delegated Regulation (EU) 2024/857 requirements on the management of interest rate risk arising from non-trading book activities. To measure and stress test the interest rate risk of the banking book, the parallel shift of the risk-free interest rate curve and other possible changes in the interest rate curve are taken into account, including changes in slope and shape, that affect the Group's net interest income and the economic value of equity. The bank assesses the following stress scenarios: 1. The effect of the risk-free interest rate curve parallel shift from -200bp to + 200bp on the group's net interest income over 12 months and on the economic value of equity is assessed. 2. The effect of the change in the shape and slope of the interest rate curve on the economic value of the Group's equity is assessed by changing interest rates between + 250bp and -250bp across maturity curves, including short-term and long-term interest rate movements in the opposite direction. 3. Changes in the slope of the interest rate curve: – rise and fall in short-term interest rates; – increase in short-term interest rates, decrease in long-term interest rates; – decrease in short-term interest rates, increase in long-term interest rates The table below specifies the estimates regarding the annual impact of a parallel shifts in the yield curve on the Group’s economic value of equity according to beforementioned calculations with simplified standardised methodology: Change in Economic Value of Equity (EVE) 31.12.2025 31.12.2024 EVE under parallel shock up 1,750 5,839 EVE under parallel shock down -13,112 -15,558 EVE under steepener shock -2,175 -2,670 EVE under flattener shock 797 2,298 EVE under short rates shock up 1,241 3,879 EVE under short rates shock down -7,982 -9,531 The table below specifies the estimates with regard to the annual impact of a parallel shifts in the yield curve on the net interest income according to aforementioned calculations with simplified standardised methodology: Change in Net Interest Income (NII) 31.12.2025 31.12.2024 NII under parallel shock up 1,910 6,748 NII under parallel shock down -5,390 -9,689 Interest risk management is made through limiting due dates of assets and liabilities of different currencies that are open to interest risk, balancing the structure of due dates of assets and liabilities and the use of derivative instruments when needed. Derivatives Derivatives are only used as a designated hedging instruments and not as speculative investments. The full fair value of hedging derivatives is classified as an asset or liability.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 98 Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness assessments, to ensure that an economic relationship exists between the hedged item and the hedging instrument. The group enters in to interest rate swaps that have similar critical terms as the hedged item, such as reference rate, reset dates, payment dates, maturities and notional amount. Interest rate swap 31.12.2025 Fair value 3,681 Notional amount 250,000 Maturity date 2029 Hedge ratio 1:1 Accumulated fair value changes of hedging instrument 327 Accumulated fair value changes of hedged item -327 In 2025, the Bank used an interest rate swap fixing derivative transaction to hedge the interest rate risk arising from the issuance of covered bonds. The notional amount of the transaction is EUR 250,000 thousand, with a maturity date of 20 March 2029, corresponding to the terms of the issued covered bond. The reference rate of the interest rate derivative transaction is the 6 -month EURIBOR, which also represents the primary reference rate base of the Bank’s loan portfolio. The interest rate derivative transaction forms part of the Bank’s interest rate risk position and is included in the calculation of interest rate risk in the banking book and stress testing, in accordance with Commission Delegated Regulation (EU) 2024/857. Operational risk management Operational risk is the risk that arises from disruptions or deficiencies in the Group's information systems, personnel, processes or external factors, causing damage or disruption to the Group's day -to-day business. Operational risk includes information systems risk, information security risk, compliance risk (including money laundering and terrorist financing risk), process risk, personnel risk, legal risk, physical security risk, work environment risk, external risk and asset destruction risk. The Group follows the operational risk policy established in the management of operational risk. Operational risk is treated and managed in the Group as a separate area of risk management for which the necessary resources have been allocated. Operational risk management is integrated into the Group's day -to- day operations and is primarily aimed at activities that prevent and control the realisation of risk. Awareness of the nature, impact and need for control of operational risk must take place at the level of each employee in the group. The most important sub-risks - information security and compliance risks – are managed separately. The assessment of operational risks in the Group is primarily qualitative. Operational risk cases are registered in the case database together with the amount of damage that has occurred. The Group monitors the quantitative dynamics of operational risk by anal ysing the main risk indicators at least quarterly. The Management Board conducts regular quarterly reviews of the main risk indicators of operational risk and incidents. The Group conducts regular operational risk self- assessment. The Group uses the basic approach to calculate the capital requirement for operational risk.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 99 Environmental, social and governance risk management Environmental, social and governance (ESG)-related risks are expressed in the effects of the Group's operations and business activities on the environment, society and related stakeholders, as well as on the Group itself, which may lead to a deterioration of the Group's financial condition, an increase in costs, damage to resources, or significant financial loss. ESG risk management is, among other things, integrated with the management of other risk categories such as credit risk, compliance risk, operatio nal risk, and strategic and reputational risk. The Group tries to avoid conscious risks, which may be accompanied by the realization of ESG risks. The Chief Risk Officer is responsible for the sustainability area among the members of the Management Board. The Supervisory Board has examined the ESG approach in the context of renewing business strategy. Coop Pank have recognized the existence of climate and environmental risks and have excluded financing that has a significant negative impact on the environment. In addition, we try to avoid creating a negative impact on society, for example, we do not offer financing for certain areas of activity that a re not in line with the goals of responsibility and sustainability. From the Group's point of view, ESG risks can be divided into two categories. In the first case, we are dealing with ESG risks of the Coop Pank AS as an organization, and in the second case, with the risks of the Group’s loan portfolio. Today, we have become aware of the main organization-specific risks as: Environmental risks – mainly related to our office operations and server parks (for instance, floods). When managing these risks, it is important to consider that our offices are located on leased premises and we do not bear significant bear significant property damage in the case of physical risks (except possible property damage to our IT equipment, furniture, etc., but we have insured against this risk). In the event of a physical adverse event, most employees will be able to continue working in the home office. Social risks – the main risks are related to employee relations, human rights, working conditions, equal opportunities, and diversity. The HR department and the management actively deal with social risk management to ensure continuous improvement of the working environment, prevention of u ndesirable events and creation of various benefits and opportunities for employees. Risks related to governance – the main risks are regulatory and related to the transparency of the bank's governance. Risks are managed through the fact that we are a listed company, and we are subject to significantly stricter frameworks and supervision requirements than ordinary companies. It is also the task of the legal department and the compliance control unit to ensure that the bank's operations comply with the applicable legal regulations. ESG risks of the bank's loan portfolio When it comes to the ESG risks of the Group's loan portfolio, we approach from the principle of double materiality, paying attention to both, factors that are influenced by the bank and aspects that affect the bank. To clarify the main points of influence of Coop Pank's loan portf olio, we have conducted an impact analysis based on the UNEP FI methodology. Leasing – leasing is most affected in the context of ESG by the fact that the global car market is increasingly moving towards electric cars, thus providing an opportunity to finance them. We also follow the principle that an important aspect of leasing portfolio’s ESG risk management is to finance a significant volume of the already
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 100 produced car fleet and not to focus only on financing new vehicles. The share of used car financing in our portfolio continues to grow. Consumer financing – the main risk is social sorisk, i.e. responsible lending. The risk is managed by assessing the loan servicing capacity on a customer -by-customer basis in accordance with current regulations and performing follow-up checks accordingly. Corresponding IT solutions are constantly bei ng developed so that the realisation of the risk is minimised. Private client real estate financing – the main risk is environmental risk. In cooperation with the Estonian Banking Association and the Estonian Association of Appraisers, a common ESG assessment has been developed, which will be used in the assessment of collateral assets. To date, the bank has mitiga ted the environmental risk through the fact that insurance is required for all guarantees. Corporate client financing – all ESG -related risks occur here, similarly to the bank's ESG risks as an organisation, as well as collateral asset risks (see private client real estate financing). To manage the accompanying risks, the bank has decided not to finance areas of activity that have a negati ve social or environmental impact. According to the internal procedures, during 2024 and 2025 it has been recommended to assess ESG risks separately for clients who are CSRD obligated (in addition so- called large companies, clients with a significant environmental impact due to their field of activity, and clients whose potential loan position is greater than 10% of the bank's Tier 1 capital). Based on assessments, we have so far made qualitative conclusions about the possible increase in credit risk. Considering the current development of ESG risk management both at the Bank and at the regulatory level, the level of ESG risks in 2025 has not been considered as an input in our ECL models. As an indirect effect, we can point out that since according to our credit policy (since 2017) it is not allowed to finance projects with either a significant environmental impact or a negative social impact, our ECL rates have been based on a portfolio in which significant ESG risk has been consciously avoided. To successfully manage and mitigate risks, we consider it important to get to know them better. Fair value of assets and liabilities The Group estimates the fair value of financial assets and financial liabilities that are not measured at fair value in the statement of financial position of the Group. Assets not measured at fair value are primarily loans and advances to customers and liabilities not measured at fair value are mainly deposits. IFRS 13 determines a hierarchy for fair value measurements that is based on whether inputs are observable or unobservable. Observable inputs reflect market information obtained from independent sources; unobservable inputs reflect assumptions that are not available in a market. The following hierarchy for fair value measurement has been established based on these two categories of inputs: Level 1 – (unadjusted) quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date. This level includes publicly quoted equity -related securities and debt instruments listed on exchanges, as well as instruments quoted by market participants. Level 2 – inputs other than quoted market prices included within Level 1 that are observable for the asset or liability, either directly (in the form of prices) or indirectly (derived from prices). Sources for input parameters (for example euro debt securities yield curve or counterparty credit risk) are Bloomberg and Reuters.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 101 Level 3 – inputs for assets or liabilities that are not based on observable market information (unobservable inputs). The fair value of loans and advances as at 31.12.2025 was 0,08% higher (1,779 thousand euros) than their carrying amount. The fair value of deposits as at 31.12.2025 was -0.03% lower (-644 thousand euros) than their carrying amount. 31.12.2025 IFRS 9 measurement Level 1 Level 2 Level 3 Fair value Carrying value Financial assets Cash, cash balances at central banks and other deposits AC 0 488,717 0 488,717 488,717 Debt securities FVOCI 55,209 0 2,826 58,035 58,035 Debt securities AC 0 0 4,988 4,988 4,988 Equity instruments FVOCI 0 13 0 13 13 Loans and advances to customers AC 0 0 2,115,870 2,115,870 2,114,091 Incl. receivables from private individuals AC 0 0 1,055,529 1,055,529 1,054,601 Incl. receivables from legal entities AC 0 0 1,060,341 1,060,341 1,059,490 Derivatives FVPL 0 3,681 0 3,681 3,681 Other financial assets AC 0 741 0 741 741 Total financial assets 55,209 493,152 2,123,684 2,672,045 2,670,266 Financial liabilities Customer deposits AC 0 2,046,816 0 2,046,816 2,047,459 incl. private individuals AC 0 1,056,335 0 1,056,335 1,056,702 incl. legal entities AC 0 983,906 0 983,906 984,182 incl. credit institutions AC 0 6,575 0 6,575 6,575 Loans received AC 0 77,046 0 77,046 77,061 incl. legal entities AC 0 5,007 0 5,007 5,022 incl. central banks AC 0 72,039 0 72,039 72,039 Debt securities AC 0 255,203 0 255,203 255,203 Other financial liabilities AC 0 13,230 0 13,230 13,230 Subordinated debt AC 0 63,148 0 63,148 63,148 Total financial liabilities 0 2,455,443 0 2,455,443 2,456,101 The fair value of loans and advances as at 31.12.2024 was 0.25% higher (4,456 thousand euros) than their carrying amount. The fair value of deposits as at 31.12.2024 was -0.13% lower ( -2,372 thousand euros) than their carrying amount.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 102 31.12.2024 IFRS 9 measurement Level 1 Level 2 Level 3 Fair value Carrying value Financial assets Cash, cash balances at central banks and other deposits AC 0 343,678 0 343,678 343,678 Debt securities FVOCI 37,751 0 0 37,751 37,751 Equity instruments FVOCI 0 13 0 13 13 Loans and advances to customers AC 0 0 1,778,574 1,778,574 1,774,118 Incl. receivables from private individuals AC 0 0 928,956 928,956 925,005 Incl. receivables from legal entities AC 0 0 849,618 849,618 849,113 Other financial assets AC 0 1,610 0 1,610 1,610 Total financial assets 37,751 345,301 1,778,574 2,161,626 2,157,170 Financial liabilities Customer deposits AC 0 1,875,449 0 1,875,449 1,877,865 incl. private individuals AC 0 966,481 0 966,481 967,891 incl. legal entities AC 0 906,417 0 906,417 907,423 incl. credit institutions AC 0 2,551 0 2,551 2,551 Loans received AC 0 8,324 0 8,324 8,280 incl. legal entities AC 0 8,324 0 8,324 8,280 Other financial liabilities AC 0 15,443 0 15,443 15,443 Subordinated debt AC 0 63,148 0 63,148 63,148 Total financial liabilities 0 1,962,364 0 1,962,364 1,964,736 The Group discounts cash flows using the market rate as a basis in order to estimate the fair value of financial assets and financial liabilities. The market rate for loans is the average interest rate used in the Group in the last 6 months prior to the ba lance sheet date. When determining the fair value of the deposits, the current deposit balances are discounted using the deposit interest rates offered to new deposits included in the analysis.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 103 Note 3 Subsidiaries and goodwill In the spring of 2024, Coop Finants AS merged with its parent company Coop Pank AS. With registration of the merger in the Estonian Commercial Registry, all the assets, rights and obligations of Coop Finants AS were transferred to Coop Pank AS, incl. goodwill recognised from the subsidiary Coop Finants AS acquisition in May 2017. Goodwill includes synergies and intangible assets that were not separately identified. The goodwill is primarily attributable to the profitability of the acquired business, the significant synergies and combined cost savings expected to arise. Goodwill is allocated to the segment of consumer financing. Goodwill as at 31.12.2025 was 6,757 thousand euros (31.12.2024: 6,757 thousand euros). As at 31.12.2025 and 31.12.2024 goodwill was tested for impairment. Value -in-use calculations are based on the following assumptions: ● forecast period 5 years (2024: 6 years) ● estimated growth in the volume of loan portfolio is 13-15% per year (2024: 8-11%) ● average increase in net income is 14% per year (2024: 9%) ● average increase in expenses is 5% per year (2024: 5%) ● average loan impairment loss is 2.4% per year (2024: 2.4%) ● weighted average cost of capital of 9% is used as cash flow discount rate (2024: 9%) ● terminal growth rate used is 2% (2024: 2%) While using these key assumptions, management relied on their best estimation of probable expectations. The value-in- use test indicated that the recoverable value of the cash-generating unit exceeds the carrying amount and consequently no impairment losses have been recognised. Based on the assessment of reasonably possible changes for key assumptions, the management has not identified any instances that could cause the carrying amount of cash-generating unit to exceed its recoverable value.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 104 Note 4 Operating segments Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision -maker. Profitability of the segments is measured by profit before income tax. The chief operating decision-maker, who is responsible for alloc ating resources and assessing the performance of the operating segments, is the management board of the Parent Company. The Group divides its business into segments based on the legal structure and the product - and customer- specific distribution within the Bank. According to the legal structure, the Group has a leasing and insurance brokerage segment that provides leasing p roducts and insurance brokerage services to both private and corporate customers, respectively. The leasing segment earns interest income from lending. Insurance brokerage earns revenue on intermediating insurance contracts. Due to the Bank's product -based division, the Group distinguishes the consumer financing segment. The consumer financing segment provides consumer loans and hire -purchase cards to private customers. The segment earns interest incomes from lending and fee commissions from issuing hire-purchase cards. Due to the Bank’s customer -based division, the Group has both corporate banking (legal entities) and retail banking (private individuals) segments. Both segments offer money transferring products and loan products to customers, as well as gathering deposit s. The segments earn interest income from lending and commissions fees from settlement of payments and bank card transactions. Segments are the basis for regular monitoring of business results by the Group's management and Supervisory Boards, and separate financial data is available for the segments. According to the Group's structure, the Group also divides the corporate banking and retail banking segments into more detailed business lines of loans and everyday banking (deposits, settlements). The Group also uses business lines for planning and budgeting, but business lines are not defined as separate segments. Revenue reported by a segment consists of revenue from external customers and additional interest income or interest expense on intersegment borrowing, which is based on the internal transfer pricing model in the Group and is shown as elimination in the tables below. The Group does not have any customers whose income would account for more than 10% of the respective type of income. The geographical breakdown of interest income is shown in Note 5. The geographical breakdown of commission fees is shown in Note 6.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 105 Segment profits in 2025, in thousands of euros Corporate banking Retail banking Consumer financing Leasing Other* Elimina- tion Total Interest income 60,534 44,383 13,650 10,008 24,713 -26,944 126,344 Incl. external income 54,187 38,032 13,650 10,008 10,467 0 126,344 Incl. internal income 6,347 6,351 0 0 14,246 -26,944 0 Interest expenses -24,926 -22,799 -2,899 -5,202 -24,193 26,944 -53,075 Net interest income 35,608 21,584 10,751 4,806 520 0 73,269 Fee and commission income 2,063 4,495 481 184 1,135 0 8,358 Fee and commission expense -683 -3,010 -40 -6 -74 0 -3,813 Net commission income 1,380 1,485 441 178 1,061 0 4,545 Net other income 138 351 204 657 192 0 1,542 Net income 37,126 23,420 11,396 5,641 1,773 0 79,356 Payroll expenses -9,011 -9,061 -2,635 -2,248 -1,451 0 -24,406 Operating expenses -3,378 -4,102 -1,593 -1,106 -651 0 -10,830 Depreciation -1,981 -2,362 -1,145 -606 -161 0 -6,255 Total operating expenses -14,370 -15,525 -5,373 -3,960 -2,263 0 -41,491 Profit before loss allowances and tax 22,756 7,895 6,023 1,681 -490 0 37,865 Credit loss allowance -746 -268 -2,064 -221 0 0 -3,299 Profit before tax 22,010 7,627 3,959 1,460 -490 0 34,566 Income tax expense -3,847 -1,326 -668 0 -1 0 -5,842 Net profit 18,163 6,301 3,291 1,460 -491 0 28,724 Fee and commission income allocation 2025, in thousands of euros Corporate banking Retail banking Consumer financing Leasing Other* Elimina- tion Total Fees from cards 476 2,926 1 0 0 0 3,403 Monthly account fees and transaction fees 352 1,205 0 0 0 0 1,557 Insurance brokerage commission 0 0 480 0 1,083 0 1,563 Foreign exchange transactions 35 4 0 0 38 0 77 Other fee and commission income 1,200 360 0 184 14 0 1,758 Total fee and commission income 2,063 4,495 481 184 1,135 0 8,358 *Other includes treasury, subsidiaries Prana Property and Coop Kindlustusmaakler. The distribution of interest income and commission income by products is presented in Note 5 and 6. Assets and liabilities as at 31.12.2025, in millions of euros Corporate banking Retail banking Consumer financing Leasing Other* Elimina- tion Total Loan portfolio 977 854 103 180 665 -665 2,114 Other assets 235 206 34 45 69 0 589 Total assets 1,212 1,060 137 225 734 -665 2,703 Total liabilities 1106 969 125 205 728 -665 2,468
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 106 Segment profits in 2024, in thousands of euros Corporate banking Retail banking Consumer financing Leasing Other* Elimina- tion Total Interest income 60,573 49,466 13,998 12,172 25,403 -22,917 138,695 Incl. external income 54,455 42,228 13,998 12,172 15,842 0 138,695 Incl. internal income 6,118 7,238 0 0 9,561 -22,917 0 Interest expenses -25,425 -24,471 -3,511 -6,224 -24,411 22,917 -61,125 Net interest income 35,148 24,995 10,487 5,948 992 0 77,570 Fee and commission income 1,640 4,107 767 268 1,117 0 7,899 Fee and commission expense -675 -2,696 -111 -6 -53 0 -3,541 Net commission income 965 1,411 656 262 1,064 0 4,358 Net other income 95 250 222 157 -769 0 -45 Net income 36,208 26,656 11,365 6,367 1,287 0 81,883 Payroll expenses -8505 -8646 -2688 -2297 -1275 0 -23,411 Operating expenses -3416 -4390 -1988 -1242 -677 0 -11,713 Depreciation -1654 -2099 -1063 -520 -116 0 -5,452 Total operating expenses -13,575 -15,135 -5,739 -4,059 -2,068 0 -40,576 Profit before loss allowances and tax 22,633 11,521 5,626 2,308 -781 0 41,307 Credit loss allowance -1,231 -525 -2,704 -183 0 0 -4,643 Profit before tax 21,402 10,996 2,922 2,125 -781 0 36,664 Income tax expense -2,715 -1,398 -360 0 -13 0 -4,486 Net profit 18,687 9,598 2,562 2,125 -794 0 32,178 Fee and commission income allocation 2024, in thousands of euros Corporate banking Retail banking Consumer financing Leasing Other* Elimina- tion Total Fees from cards 477 2,419 323 0 0 0 3,219 Monthly account fees and transaction fees 277 1,214 0 0 0 0 1,491 Insurance brokerage commission 0 0 444 0 1,061 0 1,505 Foreign exchange transactions 41 2 0 0 45 0 88 Other fee and commission income 845 472 0 268 11 0 1,596 Total fee and commission income 1,640 4,107 767 268 1,117 0 7,899 *Other includes treasury, subsidiaries CP Varad, Prana Property and Coop Kindlustusmaakler. The distribution of interest income and commission income by products is presented in Note 5 and 6. Assets and liabilities as at 31.12.2024, in millions of euros Corporate banking Retail banking Consumer financing Leasing Other* Elimina- tion Total Loan portfolio 872 729 98 178 427 -530 1,774 Other assets 158 149 28 36 44 0 415 Total assets 1,030 878 126 214 471 -530 2,189 Total liabilities 940 794 114 193 466 -530 1,977
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 107 Note 5 Net interest income Note 2025 2024 Interest income calculated using effective interest method: Loans to legal entities 11 52,836 53,244 Consumer loans and hire-purchase loans 11 13,725 14,047 Other loans to private individuals 11 37,957 42,087 Bonds 10 1,916 1,385 Other assets 9 8,907 14,575 115,341 125,338 Other similar interest income: Leasing 11 11,003 13,357 Total interest income and income similar to interest 126,344 138,695 Customer deposits 15 -41,487 -55,617 Loans received 16 -236 -240 Subordinated debt 19 -4,934 -5,022 Debt securities 17 -6,425 0 Derivatives - fair value hedging 2 226 0 Lease liabilities 14 -219 -246 Total interest expenses -53,075 -61,125 Net interest income 73,269 77,570 In 2025, the Group earned 98% of interest income from Estonian residents and 2% from residents of other countries (mostly EU countries). This ratio remains unchanged YoY. The distribution of interest income by operating segments is presented in Note 4. Loan portfolio is presented in Note 11. Note 6 Fee and commission income 2025 2024 Fees from cards 3,403 3,219 Monthly account fees and transaction fees 1,557 1,491 Insurance brokerage commission 1,563 1,505 Foreign exchange transactions 77 88 Other fee and commission income 1,758 1,596 Total fee and commission income 8,358 7,899 Expenses related to cards -2,556 -2,449 Transaction costs -290 -257 Other fee and commission expense -967 -835 Total fee and commission expense -3,813 -3,541 Net fee and commission income 4,545 4,358 The distribution of fee and commission income by operating segments is presented in Note 4. In 2025, the Group earned 83% of fee and commission income from Estonian residents and 17% from residents of other countries (mostly EU countries). In 2024, the Group earned 86% of fee and commission income from Estonian residents and 14% from residents of other countries (mostly EU countries). All fee and commission income are recognised point in time.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 108 Note 7 Payroll expenses 2025 2024 Wages and salaries -17,115 -16,481 Social tax, unemployment insurance premiums -7,291 -6,930 Total -24,406 -23,411 Social security tax payments include a contribution to state pension funds in amount 531 (2024: 266) thousand euros. Group has no legal or factual obligation to make pension or similar payments beyond social security tax. In 2025, the average number of employees of the Group (reduced to full -time equivalents) was approximately 452 (2024: 433). Note 8 Operating expenses Note 2025 2024 Administration of information systems -2,788 -2,486 Marketing expenses -1,856 -2,690 Contributions to Deposit Guarantee Fund -1,473 -1,899 Training and travel expenses -595 -656 Office expenses -862 -840 Services purchased -451 -504 Utilities of leased premises -210 -216 Financial supervision fee instalments -442 -401 Auditor services -230 -196 Short-term and low value leases 14 -209 -291 Legal services, state fees -900 -582 Insurance -82 -107 Membership fees -51 -54 Transport expenses -38 -57 Other operating expenses -643 -733 Total -10,830 -11,713 Note 9 Cash, cash balances at central banks and other deposits 31.12.2025 31.12.2024 Cash on hand 4,288 1,766 Demand deposits at the Central Bank 443,316 299,380 Demand deposits at credit institutions and other financial institutions 22,128 24,216 Cash and cash equivalents 469,732 325,362 Base level of the mandatory reserve kept in the Central Bank* 18,985 18,316 Total 488,717 343,678 * Not included in cash and cash equivalents in the consolidated statement of cash flows. Mandatory reserve at the Central Bank is the minimum amount that the bank must hold and this amount is not freely usable. The base rate of mandatory reserve kept at the Central Bank as of 31.12.2025 was 1% (31.12.2024: 1%) of all financing sources (deposits from customers and loans received). The reserve requirement is to be fulfilled as a monthly average in euros or in foreign securities preapproved by the Central Bank.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 109 Note 10 Financial investments 31.12.2025 31.12.2024 Government debt securities 51,746 30,912 Credit institutions 3,934 3,489 Debt securities of other non-financial companies 7,343 3,350 Total of debt securities 63,023 37,751 Shares of other non-financial companies 13 13 Total of equity instruments 13 13 Total of financial investments 63,036 37,764 As of 31.12.2025 debt securities of other non-financial companies in the amount of 4,517 thousand euros and debt securities of credit institutions in the amount of 471 thousand euros are recognized at amortized cost value. The remain ing debt securities in the amount of 58,035 thousand euros and equity instruments in the amount of 13 thousand euros are recognized at fair value through changes in other comprehensive income. As of 31.12.2024 all debt securities and equity instruments were recognized at fair value through changes in other comprehensive income. Note 11 Loans and advances to customers 31.12.2025 31.12.2024 Total receivables from private individuals 1,061,786 931,900 incl. consumer loans 103,179 108,146 incl. lease financing 95,429 95,903 incl. mortgage loans and other private loans 863,178 727,851 Total receivables from legal entities 1,071,726 860,769 incl. lease financing 85,711 98,823 incl. investment loan, overdraft facility and other business loans 986,015 761,946 Total receivables 2,133,512 1,792,669 Loss allowances of loans and advances -19,421 -18,551 Total 2,114,091 1,774,118 The Bank uses segment-based classification when classifying loan products.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 110 Finance lease receivables 31.12.2025 31.12.2024 Gross investment – lease payments receivable, incl. 202,129 223,499 up to 1 year 55,963 61,020 1-2 years 43,227 48,320 2-3 years 36,382 40,253 3-4 years 41,032 33,620 4-5 years 20,499 31,002 over 5 years 5,026 9,284 Future interest income -20,398 -28,134 up to 1 year -7,467 -10,491 1-2 years -5,731 -7,589 2-3 years -3,966 -5,174 3-4 years -2,301 -3,165 4-5 years -773 -1,410 over 5 years -160 -305 Finance lease net investment * 181,731 195,365 up to 1 year 48,496 50,529 1-2 years 37,496 40,731 2-3 years 32,416 35,079 3-4 years 38,731 30,455 4-5 years 19,726 29,592 over 5 years 4,866 8,979 * Finance lease receivables gross investment includes accrued interest in the amount of 4 18 (31.12.2024: 570) thousand euros and contract fees in the amount of -1,010 (31.12.2024: -1,208) thousand euros. Loan allowances 31.12.2025 31.12.2024 Balance at the beginning of the reporting period -18,551 -16,394 Loss allowances during the reporting period* -3,087 -4,914 Derecognised during reporting period due to sale or write-off of loans 2,217 2,757 Balance of allowance at the end of the reporting period -19,421 -18,551 * Loss allowances on the loan portfolio during the reporting period differ from the credit loss allowance recognised in the statement of profit or loss. The difference is due to such receipts of past due loans written off earlier as uncollectible claims, which were received in the amount of 164 (2024: 148) thousand euros during the reporting period; due to loss allowances in the amount of -345 (2024: -22) thousand euros from the exposures related to the off-balance sheet and due to loss allowances related to the Investments in debt securities. For credit risk exposures and loan collateral, see Credit Risk management section in Note 2. Distribution of loans granted by currencies is disclosed in Market Risk management in Note 2. Distribution of loans granted by maturity is disclosed in Liquidity Risk management in Note 2. The geographical distribution of loans granted is disclosed in Concentration of Risk in Note 2. For interest income on loans granted, see Note 5.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 111 Note 12 Other financial assets and other assets 31.12.2025 31.12.2024 Financial assets Security deposits 20 20 Amounts receivable 546 533 Other financial assets 175 1,057 Total financial assets* 741 1,610 Other assets Settlements with the Tax and Customs Board 1 299 Other prepayments** 1,717 1,736 Total other assets 1,718 2,035 Assets held for sale Real estate acquired for sale and properties under construction 1,190 1,099 Other assets 66 41 Total assets held for sale 1,256 1,140 *Financial assets have a good credit quality and there are no indications of impairment. ** Other prepayments include insurance, communication services, periodicals, training and other similar prepayments. Note 13 Tangible and intangible assets Right-of- use assets Land and properties Other tangible assets Internal developmen ts related to banking software External developm ents and licences related to banking software Total Carrying amount 31.12.2023 5,380 118 3,628 6,374 4,465 19,965 Acquisition and additions 464 0 787 4,717 1,132 7,100 Termination of lease contracts -13 0 0 0 0 -13 Adjustments -6 0 0 -10 -20 -36 Sale at carrying amount 0 0 -52 0 0 -52 Depreciation charged -718 -2 -1028 -2231 -1473 -5,452 Carrying amount at 31.12.2024 Incl. acquisition cost 9,253 136 7,573 13,946 13,214 44,122 Incl. depreciation -4,146 -20 -4,238 -5,096 -9,110 -22,610 Carrying amount 31.12.2024 5,107 116 3,335 8,850 4,104 21,512 Acquisition and additions 0 0 1,128 5,236 995 7,359 Termination of lease contracts 0 0 0 0 0 0 Adjustments 402 0 -4 0 -16 382 Sale at carrying amount 0 0 -1 0 0 -1 Depreciation charged -773 -3 -1032 -2,968 -1,479 -6,255 Carrying amount 31.12.2025 Incl. acquisition cost 9,655 136 8,469 19,179 14,193 51,632 Incl. depreciation -4,919 -23 -5,043 -8,061 -10,589 -28,635 Carrying amount 31.12.2025 4,736 113 3,426 11,118 3,604 22,997
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 112 Right-of-use assets include leases of property and real estate. Land and properties include office premises owned by the group. Other tangible assets include computer technology and office equipment, furniture and capitalised costs of office renovation. Note 14 Lease liabilities The Group rents various office spaces. Leases usually have a term of up to 5 years and the head office rental agreement is 10 years, but they usually include options for renewal and termination. Lease terms are agreed upon on a contract -by- contract basis and may in clude a variety of different terms. Rent agreements are recognised as right-of-use assets and liabilities. The maturity analysis of lease liabilities are disclosed in Note 2 Liquidity risk management. 2025 2024 Beginning balance 01.01 5,153 5,417 Cash flows* -606 -961 Interest expense 219 246 New leases 0 464 Terminated leases 0 -13 Ending balance 31.12 4,766 5,153 *In 2025, rent payments for several leased premises (including payments for leased premises in the Skyon commercial building) were indexed in accordance with the lease agreements. In the statement of profit or loss, the following amounts are recognised in relation to lease agreements: 2025 2024 Interest expense relating to leases (included in interest expenses) (Note 5) 219 246 Expense relating to short-term leases (included in operating expenses) 177 179 Expense relating to leases of low-value assets (included in operating expenses) 32 112 Note 15 Customer deposits 31.12.2025 31.12.2024 Private individuals 1,056,702 967,891 Legal entities 984,182 907,423 Credit institutions 6,575 2,551 Total 2,047,459 1,877,865 Demand deposits 637,205 571,865 Term deposits 1,410,254 1,306,000 Total 2,047,459 1,877,865 Note 16 Loans received 31.12.2025 31.12.2024 Legal entities 5,022 8,280 Central banks 72,039 0 Total 77,061 8,280
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 113 Note 17 Issued Debt Securities On 13 March 2025, Coop Pank issued covered bonds with a total nominal value of EUR 250 million and a maturity of four years. This issuance represented the first series of covered bonds issued under Coop Pank’s EUR 750 million covered bond programme. The co vered bonds were issued in order to diversify funding sources. The covered bonds were listed on the Irish Stock Exchange. The credit rating agency Moody’s confirmed the rating of Coop Pank’s covered bonds at the level of Aa1. In the second half of 2025, Coop Pank issued retained covered bonds to its own portfolio in a total amount of EUR 200,000 thousand, with a maturity date of 14 June 2030 and based on interest index of 6-month EURIBOR + 50 basis points. This position is reta ined in the Bank’s own holdings. Retained covered bonds are eligible as collateral (including with the central bank) and may be used in liquidity-providing operations. Note 18 Other financial liabilities and other liabilities 31.12.2025 31.12.2024 Financial liabilities Cash in transit 3,148 8,754 Customer advances 2,303 2,642 Card clearing 77 128 Balance of terminated customer contracts 5,952 1,479 Trade payables 859 850 Settlements with cooperatives 199 579 Other financial liabilities 692 1,011 Total financial liabilities 13,230 15,443 Other liabilities Payables to employees 3,338 3,675 Tax liabilities 2,598 2,042 Provisions for ECL on commitments and guarantees 828 483 Deferred liabilities 764 474 Other advance payments 56 414 Total other liabilities 7,584 7,088 Total 20,814 22,531 in thousand euros Year of issue Interest rate Maturity date Amount Covered bonds 2025 3.125% 20.03.2029 250,000 Cash flows from financing activities 249,235 Accrued interest 6,122 The amortised cost adjustments, incl. transaction costs 173 Fair value hedge adjustment -327 Issued debt securities as at 31 December 2025 255,203 Interest expenses calculated during 2025 (Note 5) -6,129 of which interest expense on issued debt securities -6,355 of which net result of hedging derivative instruments 226
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 114 Note 19 Subordinated debt The Coop Pank group has issued subordinated bonds and entered into a subordinated loan agreement in order to increase long-term capital. In the case of default of the Group, the subordinated debt is repayable after all other debts have been paid, but before debts to shareholders are paid. The balances of subordinated debt as at the end of each reporting period is disclosed in the table below. Year of issue Interest rate Maturity date Amount Subordinated bond 2019 7.58% 29.03.2029 2,000 Subordinated bond 2021 5.50% 31.03.2031 10,000 Subordinated bond 2022 5.00% 10.03.2032 10,000 Subordinated bond (Tier 1) 2022 10.00% perpetual* 16,100 Subordinated bond (Tier 1) 2023 12.00% perpetual* 12,000 Cash flows from financing activities 50,100 Subordinated debt as at 31.12.2023 50,100 Subordinated bond redeemed** 2019 7.58% 29.03.2029 -2,000 Subordinated loan agreement (Tier 2) 2024 3.25%+6m EURIBOR 12.01.2034 15,000 Cash flows from financing activities 13,000 Subordinated debt as at 31.12.2024 63,100 Cash flows from financing activities 0 Subordinated debt as at 31.12.2025 63,100 Subordinated debt accrued interest as at 31.12.2023 87 Interest expenses calculated during 2024 (Note 5) 5,022 Paid out interest expense during 2024 -5,061 Subordinated debt accrued interest as at 31.12.2024 48 Interest expenses calculated during 2025 (Note 5) 4,934 Paid out interest expense during 2025 -4,934 Subordinated debt accrued interest as at 31.12.2025 48 * Bonds have no fixed redemption date, but the Issuer has the right to redeem them in accordance with the conditions set out in CRR being met and not before five years from issuance. **The Bank has used the call option and redeemed the subordinated bond in full after the respective approval of the Financial Supervisory Authority in accordance with the Tier 2 Requirements. Accrued interest liabilities of subordinated debt are accounted in the statement of financial position using the effective interest rate.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 115 Note 20 Equity Equity Time Number of shares Strike price, in euros Share capital, in thousands of euros Share premium, in thousands of euros Share capital as at 31.12.2023 102,241,307 69,673 25,779 Paid in share capital May 2024 745,000 1.10 508 932 Share capital as at 31.12.2024 102,986,307 70,181 26,711 Paid in share capital June 2025 670,900 1.255 457 1,422 Share capital as at 31.12.2025 103,657,207 70,638 28,133 The share capital issue in 2025 and 2024 was related only to the exercising of employee share options. As at 31.12.2025 the share capital of the bank is 70,638 (31.12.2024: 70,181) in thousands of euros, which was divided into 103,675,207 (31.12.2024: 102,986,307) ordinary shares of no par value. The carrying value of one share is 0.6815 euros (31.12.2024: 0.6815). According to the articles of association, share capital can be increased to 160 million euros without any amendment to the articles of association. In 2025 Coop Pank AS used the right to increase the share capital by 457 in thousands of euros in connection with the option programme, i.e. from the amount 70,181 in thousands of euros up to the amount 70,638 in thousands of euros. The total proceeds of the subscription were 842 thousand euros. The issue price was 1.255 euros per share, of which 0.6815 euros is the book value and 0.5735 euros is the share premium. In 2024 Coop Pank AS used the right to increase the share capital by 508 in thousands of euros in connection with the option programme, i.e. from the amount 69,673 in thousands of euros up to the amount 70,181 in thousands of euros. Shares were paid for fully in cash. The total proceeds of the subscription were 820 thousand euros. The issue price was 1.10 euros per share, of which 0.6815 euros is the book value and 0.4185 euros is the share premium. In the spring of 2024, Coop Pank paid dividends to shareholders at a rate of 0.087 euros (net) per share from the profit of the year 2023, in the total net amount of 8,895 in thousands of euros. Part of the dividends (1/3 from dividends paid out in 2022 and 2023) were taxed at a preferential rate of 14/86 and the remaining part at a rate of 20/80. In the spring of 2025, Coop Pank paid dividends to shareholders at a rate of 0.07 euros (net) per share from the profit of the year 2024, in the total net amount of 7,209 in thousands of euros and additionally tax on net dividends with tax rate 22/78 in total amount of 2,033 thousands of euros was paid. As of 31.12.2025 according to the dividend policy it is possible to pay out dividends to shareholders at a rate of 0.065 euros (net) per share in the total net amount of 6,738 thousand euros. The potential dividends would be taxed at a rate of 22/78. Income tax expense information is presented in Note 25. The bank grants share options to members of the management board, department managers and key employees. The vesting period of the options is 3 years and the issue of shares will be decided in the Annual General Meeting of Shareholders or Meeting of the Sh areholders close to the vesting date. The reserve of options granted as of 31.12.2024 amounted to 1,739 (2024: 1,825) thousand euros. Related expenses in the statement of profit and loss in 2025 were 951 (2024: 952) thousand euros and 1,037 (2024: 620) thousand euros were transferred from reserve to share premium in relation to exercising the options. The fair value of options
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 116 is calculated using the Black -Scholes model, which uses the share price of the bank, strike price, volatility and risk-free interest rate as inputs. In case of options issued in 2025 the main input values used are: share price of the bank 2.105 (2024: 2.38 56) euros, strike price 1.053 (2024: 1.875) euros volatility 11% (202 4: 15%) and risk- free interest rate 1.9% (2024: 2.6%). Employees do not have the possibility to take the specified amount in cash in lieu of the share options. Share options cannot be exc hanged, sold, pledged or encumbered. Share options can be inherited. The contract of share options will expire if the employee is leaving the company before the vesting period, but the Supervisory Board can decide otherwise. In 2025, the options for 670,90 0 shares were exercised with strike price 1.255 euros per share (2024: 745,000 shares with strike price 1.10 euros). The actual share price on the date when the options were exercised was 2.14 euros (2024: 2.27 euros). The bank may issue share options for the results of 2025. Transactions with options Number of options As at 31.12.2023 2,256,500 Granted 1,022,000 Exercised -745,000 Forfeited -53,200 As at 31.12.2024 2,480,300 Granted 953,800 Exercised -670,900 Forfeited -31,700 As at 31.12.2025 2,731,500 Valid options as of 31.12.2025 are subject to exercising. Date of issue Expiry date Share price Number of options April 2023 April 2026 1.5260 785,800 April 2024 April 2027 1.8750 991,900 April 2025 April 2028 1.0530 953,800 Total options to be exercised 1.4876 2,731,500 According to the requirements of § 336 of the Commercial Code, during each financial year, at least 1/20 of the net profit shall be transferred to the statutory reserve, until the statutory reserve reaches 1/10 of the share capital. Once the statutory reserve capital reaches the amount specifie d in the Commercial Code, no more transfers on account of the net profit will be made to the statutory reserve capital. On a basis of a decision of the general meetings of shareholders, statutory reserve capital may be used to cover losses, as well as to increase share capital. Distributions to shareholders from the statutory reserve capital are not permitted. Note 21 Financial guarantees and loan commitments 31.12.2025 31.12.2024 Financial guarantees 29,539 18,498 Lines of credit and overdraft facilities 212,841 133,090 Total 242,380 151,588 The Group applies the expected credit loss model for contingent liabilities, see Note 2. As of 31.12.2025, 828 (31.12.2024: 483) thousand euros was accounted for as ECL provision for financial guarantees and loan commitments (Note 18).
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 117 The tax authorities may at any time inspect the books and records of the company within 5 years subsequent to the reported tax year and may as a result of their inspection impose additional tax assessments and penalties. The management is not aware of any circumstances which may give rise to a potential material liability in this respect. Note 22 Litigations In 2025, there were 12 lawsuits pending in courts against the Group (i.e., where the Group company is in the role of defendant or involved as a third party on the defendant’s side). Several disputes are related to the termination of payment service agreeme nts, and in some cases, the parties are contesting the ownership or size of a property. One dispute concerns a claim by a debt collection company for the re-transfer of unsecured loan agreements that were previously assigned to it by the Group. According to management’s assessment, the potential impact of these disputes is not material. Note 23 Related parties The following persons or entities have been considered as related parties for the purpose of preparing the consolidated financial statements: ● Shareholders of the parent company that have significant influence over the Group; ● The Management of the Group that includes members of the Management Board and the Supervisory Board of the parent company and entities related to them; ● Close relatives of the above persons, who have the same economic interest and entities related to them. The terms of the loans granted to related parties do not differ from the loans granted to other customers with regard to interest rates. Interest rates on loans are in the range of 3.59-6.60%, on leasings in the range of 3.41- 4.66% and on credit cards around 18%. Interest rates on deposits are in the range of 0.01-3.35%. Transactions with related parties are based on the price list and/or are carried out at market value. There were no transactions with the biggest shareholder Coop Investeeringud OÜ, who holds 21.86% of shares. Balances 31.12.2025 31.12.2024 Shareholders: Deposits 14,117 11,162 Members of the Management Board and Supervisory Board: Loans 658 252 Deposits 763 867 The persons or entities related to the Management: Loans 6,725 1,889 Deposits 9,011 8,748 Related party receivables have not been written down during the reporting period.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 118 Transactions 2025 2024 Shareholders: Interest expense 149 439 Members of the Management Board and Supervisory Board: Interest income 25 7 Interest expense 19 26 Sale of other goods and services 0 2 Salaries and other remunerations paid 1,093 958 The persons or entities related to the Management: Interest income 266 110 Interest expense 292 334 Maximum termination benefits payable to members of the Management Board on a contingent basis is 492 thousand euros (31.12.2024: 372). The Group does not have any other long-term or post-employment benefits to the members of the Management Board and the Supervisory Board. The share options issued to members of the Management Board are provided in the tables below. Transactions with options Number of options As at 31.12.2023 691,700 Granted 422,300 Exercised -270,000 Forfeited 0 As at 31.12.2024 844,000 Granted 431,400 Exercised -212,100 Forfeited 0 As at 31.12.2025 1,063,300 Valid share options issued to members of the Management Board as of 31.12.2025 are subject to exercising. Date of issue Expiry date Share price Number of options April 2023 April 2026 1.5260 209,600 April 2024 April 2027 1.8750 422,300 April 2025 April 2028 1.0530 431,400 Total options to be exercised 1.4727 1,063,300
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 119 Note 24 Basic earnings and diluted earnings per share In order to calculate basic earnings per share, net profit attributable to owners of the parent has been divided by the weighted average number of shares issued. In order to calculate diluted earnings per share, net profit attributable to owners of the parent has been divided by the diluted weighted average number of shares, taking into account the potential shares covered by options contracts. 31.12.2025 31.12.2024 Profit attributable to the owners of the parent (in thousands of euros) 28,724 32,178 Weighted average number of shares (in thousands of units) 103,389 102,688 Basic earnings per share (euros) 0.28 0.31 Adjustments for calculation of diluted earnings per share – share options (in thousands of units) 2,632 2,401 Weighted average number of shares used for calculating the diluted earnings per share (in thousands of units) 106,021 105,089 Diluted earnings per share (euros) 0.27 0.31 Note 25 Income tax expense The annual profit earned by enterprises is not taxed in Estonia and thus there are no temporary differences between the tax bases and carrying values of assets and liabilities and no deferred tax assets or liabilities arise (except for recognising a deferr ed tax liability for all taxable differences associated with investments in subsidiaries, associates and branches, unless it is probable that the temporary difference will not reverse in the foreseeable future). In connection to the amendments to the Income Tax Act, starting from 2018 credit institutions are obliged to pay an advance income tax on previous quarter net income before income tax. The tax rate was 14% until the end of 2024, increasing to 18% starting from the first quarter of 2025. Income tax is calculated based on unconsolidated profit of the credit institution, which is the parent company. Advance income tax does not apply to the profits of subsidiaries and are presented as non-taxable income in the table below. Advance income tax paid can be taken into account on the distribution of profits and the calculation of the related income tax liability. In calculating income tax, the profit is reduced by the dividends received and the profit attributed to the permanent establishment to which the exemption method is applied in order to avoid double taxation. Secondly, the profits will be reduced by losses earned in the previous quarters. Income tax is recognised in the consolidated statement of profit or loss as income tax expense in the period in which the basis for calculating the income tax is calculated, regardless of when the income tax is paid. Income tax expense 2025 2024 Profit before tax 34,566 36,664 incl. non-taxable income 2,113 4,623 Advance income tax for credit institutions -5,842 -4,658 Effective tax rate 17% 12% Income tax liabilities 2025 2024 Balance as at 01.01 957 2,280 Accrual income tax recognised 5,842 4,486 Paid income tax -5,494 -5,809 Balance as at 31.12 1,305 957
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 120 In 2025 the bank had paid advance income tax for credit institutions in the amount of 5,494 (202 4: 5,809) thousand euros. On May 6, 2024, Coop Pank paid dividends from the profit of the year 2023 in the total net amount of 8,895 thousand euros. Part of the dividend (1/3 from dividends paid out in 2022 and 1/3 from dividends paid out in 2023) was taxed at a preferential rate of 14/86 in the amount of 396 thousand euros and the remaining part at a tax rate of 20/80 in the amount 1,615 thousand euros. The total related income tax charge on dividends was 2,011 thousand euros. The income tax liability calculated on net dividends wa s offset against the advanced income tax for credit institutions paid by the bank. On May 6, 2025, Coop Pank paid a dividend of 0.07 euros (net) per share from the profit earned in 2024, in the total net amount of 7,209 thousand euros. The dividend was taxed at an income tax rate of 22/78 in the amount of 2,033 thousand euros. The income tax liability calculated on net dividends was offset against the advanced income tax for credit institutions paid by the bank. According to the dividend policy as of 31.12.2025 it is possible to pay out dividends to shareholders in the net amount of 6,738 thousand euros from the profit of the 2025 financial year, that would be taxed at an income tax rate of 22/78 in the amount of 1,900 thousand euros. The Bank has paid sufficient advance income tax for credit institutions in 2025 or earlier to cover the income tax liability calculated on dividends. Information related to paid dividends is presented in Note 20. Note 26 Events after balance sheet date In December 2025, the Bank signed a subordinated loan agreement with the European Energy Efficiency Fund for an additional EUR 5,000 thousand subordinated loan eligible to Tier 2 capital. The loan amount was fully drawn in February 2026. On 21st of January 2026 Supervisory Board of the Bank has appointed Alvar Pihlapuu as a new member of the Management Board of the Bank.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 121 Note 27 Separate financial statements of parent company Statement of Profit or Loss and Other Comprehensive income of parent company 2025 2024 Interest income calculated using the effective interest method 123,104 131,502 Interest and similar expense -53,078 -61,130 Net interest income 70,026 70,372 Fee and commission income 7,202 6,218 Fee and commission expense -3,813 -3,461 Net fee and commission income 3,389 2,757 Net gains from non-financial asset realisation 0 53 Net gains from financial assets measured at fair value through other comprehensive income 251 33 Handling of overdue receivables 582 408 Other income 845 200 Net other income 1,678 694 Payroll expenses -23,101 -22,052 Operating expenses -10,303 -10,707 Depreciation -6,141 -5,233 Total operating expenses -39,545 -37,992 Profit before loss allowances and tax 35,548 35,831 Credit loss allowance -6,073 -3,791 Profit before tax 29,475 32,040 Income tax expense -5,841 -4,486 Net profit for the financial year 23,634 27,554 Other comprehensive income / loss (-) Items that may be subsequently reclassified as profit or loss: Financial assets at fair value through other comprehensive income -402 757 Comprehensive income / loss (-) for the financial year 23,232 28,311
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 122 Statement of Financial Position of parent company 31.12.2025 31.12.2024 Assets Cash and cash equivalents 469,729 325,361 Mandatory reserve kept in the Central Bank 18,985 18,316 Debt securities at fair value through other comprehensive income 58,035 37,751 Debt securities at amortized cost 4,988 0 Equity instruments at fair value through other comprehensive income 13 13 Loans and advances to customers 2,102,629 1,768,155 Derivatives 3,681 0 Investments in subsidiaries 551 551 Other financial assets 804 1,750 Other assets 1,697 1,724 Right-of-use assets 4,736 5,107 Tangible assets 3,539 3,451 Intangible assets 14,148 12,354 Goodwill 6,757 6,757 Total assets 2,690,292 2,181,290 Liabilities Customer deposits 2,048,805 1,878,993 Loans received 77,061 8,280 Debt securities 255,203 0 Lease liabilities 4,766 5,153 Other financial liabilities 12,206 13,579 Other liabilities 7,332 8,182 Subordinated debt 63,148 63,148 Total liabilities 2,468,521 1,977,335 Shareholders' equity Share capital 70,638 70,181 Share premium 28,133 26,711 Statutory reserve capital 8,424 6,815 Retained earnings 112,941 98,125 Other reserves and assets revaluations 1,635 2,123 Total shareholder’s equity 221,771 203,955 Total liabilities and shareholders’ equity 2,690,292 2,181,290
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 123 Statement of Cash Flows of parent company 2025 2024 Cash flows from operating activities Interest and other similar income received 119,321 130,555 Interest paid -50,271 -64,346 Fees and commissions received 7,202 6,218 Fees and commissions paid -3,813 -3,461 Other received income 1,427 1,445 Salaries paid -23,493 -21,255 Other operating expenses paid -10,303 -10,512 Advance Income Tax paid -5,494 -5,809 Total cash flows from operating activities before changes in operating assets and liabilities 34,576 32,835 Change in operating assets: Loans and advances to customers -340,300 -282,106 Change of base level of the reserve kept in the Central Bank -669 -1,218 Other assets 1,011 -3,463 Change in operating liabilities: Change in customer deposits 173,126 168,891 Change in loans received 68,781 -1,402 Other liabilities -2,045 3,543 Net cash flows from operating activities -65,520 -82,920 Cash flows from investing activities Acquisition of tangible and intangible assets -7,271 -6,360 Sale of tangible and intangible asset and assets held for sale 1 52 Acquisition of debt securities -40,010 -2,342 Sale and redemption of debt securities 15,210 1,253 Increase of subsidiary’s equity -300 -601 Merger with a subsidiary 0 1,061 Total cash flows used in investing activities -32,370 -6,937 Cash flows from financing activities Paid in share capital 842 820 Issue of subordinated debt 0 15,000 Redemption of subordinated bonds 0 -2,000 Dividends paid -7,209 -8,895 Debt securities 249,235 0 Repayment of lease liabilities -606 -961 Total cash flows from financing activities 242,262 3,964 Effect on exchange rate changes on cash and cash equivalents -2 -1 Change in cash and cash equivalents 144,370 -85,894 Cash and cash equivalents at beginning of the period 325,360 411,254 Cash and cash equivalents at the end of the period 469,730 325,360 Cash and cash equivalents balance is comprised of: 469,730 325,360 Cash on hand 4,288 1,766 Demand deposits at the Central Bank 443,316 299,380 Demand deposits at credit institutions and other financial institutions 22,126 24,214
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 124 Statement of Changes in Equity of parent company Share capital Share premium Statutory reserve capital Other reserves Revaluation reserve Retained earnings Total shareholde r’s equity Equity as at 31.12.2023 69,673 25,779 4,855 1,493 -459 39,103 140,444 Paid in share capital 508 932 0 -620 0 0 820 Dividends paid 0 0 0 0 0 -8,895 -8,895 Merger with a subsidiary 0 0 0 0 0 42,323 42,323 Changes in statutory reserve capital 0 0 1,960 0 0 -1,960 0 Share options 0 0 0 952 0 0 952 Net profit 0 0 0 0 0 27,554 27,554 Other comprehensive income 0 0 0 0 757 0 757 Total comprehensive income 0 0 0 0 757 27,554 28,311 Equity as at 31.12.2024 70,181 26,711 6,815 1,825 298 98,125 203,955 Paid in share capital 457 1,422 0 -1,037 0 0 842 Dividends paid 0 0 0 0 0 -7,209 -7,209 Changes in statutory reserve capital 0 0 1,609 0 0 -1,609 0 Share options 0 0 0 951 0 0 951 Net profit 0 0 0 0 0 23,634 23,634 Other comprehensive income 0 0 0 0 -402 0 -402 Total comprehensive income 0 0 0 0 -402 23,634 23,232 Equity as at 31.12.2025 70,638 28,133 8,424 1,739 -104 112,941 221,771 In accordance with the Estonian Accounting Act, adjusted unconsolidated retained earnings are the amount that a company may use to make distributions to shareholders. A reconciliation of the parent company’s equity with its adjusted unconsolidated equity is presented in the table below. Adjusted unconsolidated equity Book value of holding under control or significant influence -551 Value of holdings under control or significant influence, calculated by equity method 13,323 Adjusted unconsolidated equity as at 31.12.2025 234,543
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 125 Management Board declaration The Management Board has prepared the management report and the consolidated financial statements of Coop Pank AS for the financial year ended 31 December 2025. The Management Board confirms that according to their best knowledge the consolidated financial statements of Coop Pank AS for the year 2025, prepared in accordance with current international financial reporting standards as adopted by the European Union, provide a true and fair view of the assets, liabilities, financial position and financial performance of the Coop Pank AS, consisting of the parent company and other consolidated entities as a whole, and the management report of the Coop Pank AS also gives a true and fair view of the business activities, financial performance and financial position, and contains a description of the main risks and uncertainties. The 2025 consolidated annual report of Coop Pank AS will be presented to the general meeting of shareholders for approval in April 2026. The previous 2024 consolidated annual report was approved by the general meeting of shareholders on 16 April 2025. Arko Kurtmann Chairman of the Management Board /Signed digitally/ 10.03.2026 Paavo Truu Member of the Management Board /Signed digitally/ 10.03.2026 Alvar Pihlapuu Member of the Management Board /Signed digitally/ 10.03.2026 Heikko Mäe Member of the Management Board /Signed digitally/ 10.03.2026 Karel Parve Member of the Management Board /Signed digitally/ 10.03.2026 Lehar Kütt Member of the Management Board /Signed digitally/ 10.03.2026
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 126 Independent auditor’s report
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 127
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 128
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 129
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 130
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 131
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 132
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 133
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 134 Proposal for profit allocation The Management Board of Coop Pank AS proposes to the General Meeting of the Shareholders to allocate the Group’s net profit for the financial year 2025 in the amount of 28,724 thousand euros as follows: 1. pay dividends 0.065euro per share in the total net amount of 6,738 thousand euros, related income tax on dividend would be 1,900 thousand euros; 2. allocate 1,436 thousand euros to statutory reserve capital; 3. allocate 20,550 thousand euros to retained earnings.
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2025 135 Revenues by EMTA classification (the Estonian classification of economic activities) Title Economic activity based on EMTAK Code Sales income (in euros) Finance activities Credit institutions (consolidated) 64191 136,244,117 Finance activities Credit institutions (separate) 64191 131,983,889 Leasing activities Finance lease 64911 11,798,950 Insurance activities Insurance brokerage 66221 920,427
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Translation of the company’s consolidated financial statements in pdf -format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine -readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (Link: https://nasdaqbaltic.com/statistics/et/instrument/EE3100007857/reports ) Coop Pank annual report 2023 136 Investor Relations Contacts +372 669 0966 paavo.truu@cooppank.ee www.cooppank.ee