VUB's Market Share and Financial Services

ARREARS COLLECTION POLICY 1 Service DPD approach Service/ 30 Standard DPD approach SOFT - 60 180 DPD Standard approach 180+ DPD Hard COLLECTION collection process starts TIMING 4 weeks 4 weeks - 12 weeks (applied 3 times - every month) - - - ACTION TAKEN INTERNAL PROCESSES AND DOCUMENTS The client is contacted by phone SMS or formal letter for a soft reminder of the unpaid receivables The borrower is contacted by phone to understand the reason of the overdue Second SMS and letter sent Possible restructuring of the unpaid debt Request for payment of the unpaid The client is contacted by phone explaining the potential risk of not paying Last reminder (SMS and letter) sent out Formal request for payment of the unpaid Recording info into Credex (1) (payment promise details) Recording info into Credex (payment promise details) Recording payment promise in Credex If actions above do not succeed, client is automatically transferred to Hard Collection Module in Credex In 2018 only 0.42% of clients in Soft Collection Phase rolled to Hard Collection phase First/ Second Step HARD Up to final recovery The last pre-termination letter sent to the client If no feedback from client has been received, loan is accelerated (the whole amount becomes due and payable) After loan acceleration, client has the following alternative to work out: Voluntary repayment of the whole loan Repayment schedule COLLECTIOZ Property sold by the client: the client should sell the property by 6 months form the agreement Best choice for the Bank The whole loan amount will be repaid by the client through an updated amortisation plan The best choice for the client Monitored automatically If alternatives above do not succeed, properties are auctioned Standard process set up with Auction company - - - Worst choice for client, simple process for the Bank (1) Credex is VUB IT system designed for collection activities only - No intervention of the Court while selling the assets Collateral realisation through auction takes in average from 3 to 9 months since process triggered Final step- Auction N 35

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