ANNUALREPORT

2016

MILLENNIUM.HERE I CAN.

MOMENTS MILLENNIUM 2016 Images from the year: business, culture and sustainability.

23INFORMATION ON THE BCP GROUP

ANNUAL REPORT 2016

Banco Comercial Português, S.A. has a one-tier management and supervision model, composed of a Board of Directors, which includes an Executive Committee and an Audit Committee comprising only non-executive directors. The Company also has a Remunerations and Welfare Board and an International Strategic Board.

In addition, the Group uses a Statutory Auditor and an external auditing firm to audit the individual and consolidated accounts of the Bank, whose appointment is resolved at the General Meeting.

The members of the governing bodies were elected at the General Meeting of Shareholders held on 11 May 2015 to perform duties for the three-year period 2015/2017.

GOVERNANCE

GENERAL MEETING OF SHAREHOLDERS

BOARD FOR INTERNATIONAL

STRATEGYCLIENT OMBUDSMAN

• Nominations and Remunerations Committee• Corporate Governance, Ethics and Professional Conduct Committee• Risk Assessment Committee

ORGANISATIONAL CHART OF THE COMPANY'S CORPORATE GOVERNANCE MODEL

BOARD OF DIRECTORS

REMUNERATION AND WELFARE BOARD

COMPANY SECRETARYAUDIT COMMITTEE

STATUTORY AUDITOR (ROC)

EXECUTIVE COMMITTEE

COMMISSIONS AND SUBCOMMISSIONS

• Legal Affairs• Costs and Investments – Costs and Investments Sub-Commission• Companies• Human Resources

• Retail – Customer Experience Sub-Commission – Investment Products Sub-Commission• Non-Core Business• Compliance Office – AML Sub-Commission

• Pension Fund Monitoring• Credit• Non-core credit• Capital, Assets and Liabilities Management• Risk• Credit at Risk

• Pension Funds Risk Monitoring• Security• Moving Forward• Speedway• Internal Control and Operational Risk Monitoring

The General Meeting is the highest governing body of the company, representing the entirety of the Shareholders, and its resolutions are binding for all when adopted under the terms of law and the articles of association. The General Meeting is responsible for:

• Electing and dismissing the Board, as well as the members of the management and supervisory bodies, and the Remuneration and Welfare Board;

• Approving amendments to the memorandum of association;• Resolving on the annual management report and accounts for the year and proposed appropriation of profits;• Resolving on matters submitted upon request of the management and supervisory bodies;• Resolving on all issues especially entrusted to it by the law or articles of association, or on those not included in the duties of other

corporate bodies.

The Board of Directors (BoD) is the governing body of the Bank with the most ample powers of management and representation, pursuant to the law and the articles of association.

Under the terms of the articles of association in effect, the Board of Directors is composed of a minimum of 17 and a maximum of 25 members with and without executive duties, elected by the General Meeting for a period of three years, who may be re-elected. The increase of the number of members of the Board of Directors to 25 was approved on 9 November 2016.

The Board of Directors in office as at 31 December 2016 was composed of 21 permanent members, with 13 non-executive and 8 executive members (of which 2, one executive and one Non-executive, were not yet exercising functions).

The Board of Directors appointed an Executive Committee composed of 8 of its members, to which it delegates the day-to-day management of the Bank. During 2016 the Executive Committee was assisted in its management functions by several commissions and subcommissions which oversaw the monitoring of certain relevant issues.

31INFORMATION ON THE BCP GROUP

ANNUAL REPORT 2016

The programme “#1 in Customer Experience” is a transformational project to provide Clients with distinctive and memorable experiences through the ongoing improvement of the product and service range, the adaptation of the Bank's channels to today's trends, the simplification of processes and, naturally, the development of the Employees' skills.

Within this scope, the Bank held in 2016 a comprehensive training programme involving more than 2,600 Employees of the branches. The programme approached themes related to Customer service practices, sales techniques, management of objections and transmitted the principles of a new Customer service model adjusted to each type of branch and service provided.

After these in-house training sessions, the Bank created a monthly systematic training to be developed in each branch, named Training #1, with the purpose of consolidating the acquired knowledge and ritualize the practices and behaviours able to provide an experience of excellence to our Clients.

In order to strengthen the measurement of satisfaction and loyalty in the various Customer segments, Millennium bcp continued to monitor various market studies carried out by specialised companies, so as to obtain indicators to position the Bank in the sector and assess, in an evolutionary way, market perception with regard to quality of the service provided, the Bank's image and the products and services it sells. Three of these studies are the BASEF Banca, the BFin (DataE) and the BrandScore.

In the international activity, Customers' overall satisfaction levels with the Bank recorded a value of 80 index points (i.p.), influenced by the downturn in Mozambique, which fell from 80 to 75 i.p.

In Poland, with 85 i.p. of global satisfaction, the internet banking and mobile banking channels reached 99% of positive reviews in 2015.

Index pointsCUSTOMERS SATISFACTION

20162014 2015

80.082.079.0

International activity

Information not available for Switzerland.

COMPLAINTSIn Portugal, the total number of complaints, 20,423, showed a significant decrease if compared to the previous year. The majority, 76%, are claims related to current account debit/credit entries, card transactions and mortgage loans. The effort made aiming at a rapid resolution of the claims has been a constant concern of the Bank which has been able to guarantee an average response deadline of 6 business days, with 64% of the claims being solved in up to three days. Regarding international activity: (i) Poland recorded 5.8% more complaints than in the previous year, with 83% regarding current accounts, mortgage loans, card transactions and automatic services; (ii) in Mozambique, the complaints increased 7.2% with cards, automatic services and current accounts being the most frequently mentioned issues.

CLAIMS

2016 2015 2014 Change %16/15

CLAIMS REGISTERED

Activity in Portugal 20,423 27,529 27,126 -25.8%

International activity 53,940 51,579 46,658 4.6%

CLAIMS RESOLVED

Activity in Portugal 18,454 26,739 25,668 -31.0%

International activity(1) 51,894 50,141 45,472 3.5%

Note: Data for 2016 do not include Angola, whose operation was discontinued in 2016.(1) Includes valid claims related with the disregard of the privacy of Customers in Poland (28) and in Mozambique (25), based on the wrong processing of personal data and operational errors.

The average response time recorded was 16 consecutive days in Poland, and 7 business days in Mozambique.