1 11 eport 20 R Annual

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4 2 This document is a translation of the Dutch original and is provided as a courtesy only. In the event of any disparity, the Dutch version shall prevail. No rights may be derived from the translated document.

5 Contents BinckBank overview 5 Profile BinckBank 5 Key figures 7 Key events in Chairman s message 10 BinckBank in a European context 12 Vision, mission, strategy and objectives 16 Information for shareholders 22 Financial calendar 2012 and Report of the executive board 29 Review of the financial results 29 Retail business unit 33 Professional Services business unit 37 Subsidiaries, joint ventures and assosiates 39 Outlook Human Resources 42 Corporate social responsibility 44 Executive board members 50 Report of the supervisory board 91 Message by the chairman of the supervisory board 92 Duties of the supervisory board 93 Composition of the supervisory board 93 Meeting of the supervisory board and subcommittees in Broad outlines of the remuneration report 97 Loans granted to members of the executive board 99 Remuneration of members of the supervisory board and subcommittees in Consultation with the Works Council 101 Financial statements and dividend 101 Supervisory board members 102 Financial statements Risk & capital management 53 Key developments in Overview of risk management at BinckBank 55 Capital structure 59 Capital management 62 Relevant risks and control measures 63 Capital adequacy and results of stress tests for BinckBank 71 Risk management accountability 73 Liquidity management 75 Liquidity profile of BinckBank 76 Liquidity risk management 76 Contingency Funding Plan (CFP) 78 Capital requirement for liquidity risk 78 Statement by the executive board 79 In-control statement 79 Corporate governance 81 Introduction 81 Developments in The Code 83 The Banking Code 88 Article 10 of the Takeover Directive 89 Conclusion 89

6 BE OPEN AND CRITICAL EXCEED EXPECTATIONS WHAT IS DNA? THE MOST IMPORTANT CARRIER OF GENETIC INFORMATION EXCEL AT WHAT YOU DO WORK WITH PASSION AND PLEASURE OUR DNA # 1

7 BinckBank Overview Profile BinckBank BinckBank N.V. (hereinafter, BinckBank ), incorporated in 2000, is an online bank for investors. BinckBank s core business is providing a comprehensive, user-friendly website that allows private investors to invest easily and quickly anywhere in the world at competitive rates. BinckBank is ranked in the top five online brokers in Europe, and has repeatedly received rewards as the best online broker in the Netherlands, Belgium and France. BinckBank is listed on NYSE Euronext Amsterdam, and has been listed on the Amsterdam Midkap Index (AMX) since 1 March At year-end 2011, BinckBank s market capitalisation stood at 621m and the average daily turnover in BinckBank shares in 2011 was 252,815. BinckBank s ambition is to be the largest online bank for investors in Europe. It is already the market leader in the Netherlands, and has strong positions in Belgium and France. BinckBank expects to commence operations in Italy in mid-2012.

8 The Retail business unit services private investors under the brands Alex and Binck. Under the Alex brand, we focus on Dutch private investors looking to achieve more with their capital. In addition to an extensive investment website, Alex offers savings, asset management, investment funds and education courses for investors. At Binck, we focus on the active private independent investor with order execution at competitive rates in combination with extensive facilities, including a professional investment website with real-time streaming prices, news, depth of order book, research, recommendations and tools for technical and other analysis. In addition to serving private investors, BinckBank serves approximately 100 professional parties. The Professional Services business unit serves independent investment managers, banks, insurance companies and pension administrators in the Netherlands and Belgium. Through our online product we provide a complete securities transaction service with the associated banking administration. Our Professional Services customers can opt for a service provision agreement with BinckBank, or they can make independent use of the software supplied by our daughter company Syntel, which allows customers to manage their own operations. BinckBank s has stakes in Syntel (software supplier, 100%-owned), ThinkCapital (issuer of ETFs, 60% holding), BeFrank (pension accumulation, 50% holding) and TOM (multilateral trading platform, 38.5% holding). 6

9 Key figures x 1,000 FY11 FY10 FY09 FY08 Customer figures Customer accounts 531, , , ,826 Retail 468, , , ,299 Professional Services 63,421 27,460 25,386 8,527 Number of transactions 9,709,795 8,854,215 9,617,181 7,151,244 Retail 8,936,459 8,268,167 9,144,980 6,807,997 Professional Services 773, , , ,247 Assets under administration 13,724,175 14,124,667 10,942,742 6,065,852 Retail 8,646,209 9,739,332 8,031,695 5,001,484 Professional Services 5,077,966 4,385,335 2,911,047 1,064,368 7 Income statement Net interest income 38,907 43,587 43,825 40,640 Net fee and commission income 128, , , ,181 Other income 13,322 13,599 9,661 6,162 Result from financial instruments 3, ,353 1,230 Impairment of financial assets (268) 70 (857) (205) Total income from operating activities 183, , , ,008 Employee expenses 50,861 45,480 43,185 38,443 Depreciation and amortisation 35,463 34,798 35,939 31,789 Other operating expenses 43,800 44,223 43,388 37,316 Total operating expenses 130, , , ,548 Result from operating activities 53,451 60,345 63,710 41,460 Share in results of associates and joint ventures (5,848) (1,386) (1,466) 520 Other non-operating income Result before tax 47,603 58,982 62,244 41,980 Tax (13,513) (14,837) (15,083) (8,941) Result after tax 34,090 44,145 47,161 33,039 Result after tax (discontinued operations) Net result 34,090 44,145 47,161 33,145 Result attributable to non-controlling interests Net result attributable to shareholders BinckBank 34,210 44,240 47,161 33,145 IFRS amortisation 28,196 28,196 28,196 28,196 Fiscal goodwill amortisation 2,737 2,792 2,792 2,792 Adjusted net earnings 65,143 75,228 78,149 64,133 Average number of shares outstanding during the year 74,142,108 74,080,265 74,897,706 76,870,870 Adjusted earnings per share ( ) Balance sheet & capital adequacy Balance sheet total 3,351,455 3,216,768 2,930,010 2,578,394 Equity 469, , , ,641 Total available capital (Tier I) 160, ,257 95,569 77,295 BIS ratio 31.1% 23.9% 18.4% 17.2% Solvency ratio 23.1% 15.7% 13.0% 13.6% Cost / income ratio Cost / income ratio 71% 67% 66% 72% Cost / income ratio excluding IFRS amortisation 56% 52% 51% 53%

10 KEY EVENTS JUNE TOM MTF OBTAINS AN AFM LICENCE FOR DERIVATIVES TRADING 10 JUNE ANDROID APP AVAILABLE FOR BINCK CUSTOMERS 21 FEBRUARY TOM BROKER B.V. OBTAINS MEMBERSHIP OF EURONEXT LIFFE 14 APRIL THINKCAPITAL LAUNCHES FOUR GLOBAL ETFs 24 JUNE BEFRANK, THE FIRST PREMIUM PENSION INSTITUTION, OBTAINS A LICENCE FROM DE NEDERLANDSCHE BANK (DNB) FEBRUARY MARCH APRIL MAY JUNE 11 MARCH 28 MARCH BINCK IS NAMED AS THE FRENCH ONLINE BROKER WITH THE BEST PRICE/SERVICE RATIO BY MIEUX VIVRE VOTRE ARGENT BINCK LAUNCHES AN IPHONE APP AND A NEW MOBILE WEBSITE 13 MAY 25 MAY BINCK LAUNCHES IPAD APP BINCK IS CHOSEN AS BEST ONLINE BROKER IN THE NETHER- LANDS BY IEX NETPROFILER FOR THE 5TH CONSECUTIVE YEAR

11 9 NOVEMBER BINCK IS NAMED BEST BROKER BY BEURSBULLETIN IN THE NETHERLANDS 10 NOVEMBER ALEX ACADEMY, ALEX ASSET MANAGEMENT, ALEX ZELFBELEGGEN AND THINKCAPITAL ARE AWARDED THE GOUDEN STIER 11 SEPTEMBER IN FRANCE, BINCK IS AWARDED THE LABEL D EXCELLENCE 2012 BY LES DOSSIERS DE L EPARGNE 18 NOVEMBER FRENCH FINANCIAL DAILY LES ECHOS NAMES BINCK AS ONE OF THE BEST THREE ONLINE BROKERS IN FRANCE 22 SEPTEMBER BEFRANK IS AWARDED THE GOUDEN SCHILD FOR PENSION PRODUCT OF THE YEAR 2011 TOM COMMENCES 25 TRADING IN OPTIONS NOVEMBER JULY SEPTEMBER OCTOBER NOVEMBER DECEMBER 21 JULY BINCK ADDS SCANDINAVIAN MARKETS TO ITS INVESTMENT UNIVERSE 24 OCTOBER BINCKBANK WINS THE HENRI SIJTHOFF PRIZE FOR BEST FINANCIAL REPORTING IN THE AMX AND ASX CATEGORY 1 DECEMBER NYSE EURONEXT REDUCES OPTION FEES FROM 0.75 TO 0.40 PER CONTRACT 22 JULY ALLIANZ BECOMES A BPO CUSTOMER OF PROFESSIONAL SERVICES 16 DECEMBER BINCKBANK RESUMES SHARE BUY-BACK PROGRAMME 20 DECEMBER ALEX COMES TOP IN THE BROKERTARIEVEN CUSTOMER SATISFACTION SURVEY

12 Chairman s message Dear readers, The preparation of the annual report each year is an ideal time to look back on the past year, but also to present a clear picture of BinckBank s business to our stakeholders. Who are we, and what do we do? We will devote special attention to these aspects in this annual report. The theme of the report for 2011 is BinckBank s DNA. To a large extent, our values and standards determine who we are and what we do. What this means for you as a stakeholder and BinckBank s business ethics is described in the theme pages you will find distributed throughout the annual report. In just 10 years BinckBank s DNA has taken us to our present position of one of the largest online brokers in Europe. In the next few years, it will support us in achieving our ambition of becoming Europe s largest online bank for investors. To exceed expectations, it is important that we have the trust of our customers, and accordingly the stability and security of the bank are major priorities. BinckBank has a strong capital position (BIS ratio of 31.1%), no outstanding liabilities or direct exposure to the PIIGS countries and already meets the stricter requirements of Basel III. BinckBank moreover has a controlled and transparent remuneration policy that does not provide an incentive for high-risk behaviour. 10 To ensure that we continue to earn the trust placed in us by our customers and other stakeholders, our focus with our existing products and new product development is continually on serving the customer s interest. Our products are user-friendly and transparent, and come with high-quality service. We charge competitive rates with no hidden costs. Various new products were introduced for private investors last year. BinckBank has launched a new website, various applications for smart phones and a mobile website. We have also made trading in Scandinavian markets available to our customers. In Belgium and France, our extensive improvements to the service provided include the making of five new markets available for trading, high-quality analysis tools, improved search functions and a new customer website. These innovations certainly contributed to Binck and Alex once again being chosen as best online broker several times this year, and to BinckBank s succeeding in increasing its market share among online brokers in France from 10% to 16%*. In line with its target, our Professional Services business unit signed two BPO contracts and successfully completed the first phase of the migration of SNS Bank clients. The new securities giro account was moreover introduced at the end of This will enable large numbers of investors to be serviced automatically at the same time. We expect several of our customers to make use of this facility in BinckBank resumed its share buy-back programme on 16 December In principle, we will continue the programme for as long as the solvency ratio remains above 20% on a permanent basis. Over a period of 18 months, we expect to repurchase shares up to an amount of 28m. In 2012, we will once again launch several new products in the market and we expect to launch Binck s service in Italy in the middle of the year. Among other things, we are currently working on finalising the development of the portfolio-based margin system in consultation with a number of customers. We expect to introduce this system in the first half of For active investors, this means that for option strategies their margin requirement will be reduced without materially impacting the risk for BinckBank. For the Professional Services business unit, we expect to expand the service with banksparen and bankbeleggen, and independent investment managers will be given mobile access to the platform. * Source: l Acsel, l association de l economie numérique

13 Based on our results and the developments during the year, we are confident regarding the further growth and prospects for BinckBank. We will continue to invest in the future and the quality of our business, so that BinckBank can grow into Europe s number one online bank for investors. In conclusion, I would like to express my appreciation to all our customers and shareholders for their confidence in BinckBank, and to all our staff for their efforts during the past year. Amsterdam, 8 March 2012 Koen Beentjes Chairman of the BinckBank executive board 11

14 BinckBank in a European context The online brokerage market in Europe The online brokerage landscape in Europe is fragmented. There are several players operating in various European countries, but only a few operate on a European scale. A number of the larger European online brokers are wholely or partly owned by the major banks. Generally speaking, their strategy is different from that of specialist players like BinckBank. While BinckBank has a clear focus on online brokerage and securities-related services, the subsidiaries of the major banks are increasingly developing into online banks, offering services such as current accounts, credit cards, mortgage products and insurance. These services are in many cases offered with the support of product expertise from the parent company. BinckBank has made a conscious decision to focus on online brokerage and securities-related services because it wishes to remain a specialist in this field. It could of course be the case that other banking products will become part of the service package provided by BinckBank as a result of possible future acquisitions. 12 There has been speculation regarding European consolidation within the sector for some time, since this could generate substantial scale benefits. However so far, European mergers and acquisitions have not occurred. In our opinion, this is because: Most online brokers are profitable and therefore place only a limited demand on the parent company s capital; The valuation of most online brokers, despite their sound profitability, is currently low; Many online brokers are wholely or partly owned by major banks that often partly fund their banking operations out of the surplus liquidity at the broker, meaning that the online broker in many cases provides an essential element of the funding requirement; and The value of the online broker is generally low in proportion to the size of the banking parent. Disposible of the online broker is therefore not considered to be a solution for restructuring the parent company s balance sheet. BinckBank versus peers in Europa BinckBank Boursorama ComDirect Swissquote Avanza Nordnet Keytrade* IW Bank* Fineco* x million Home market Netherlands France Germany Switzerland Sweden Sweden Belgium Italy Italy Other markets Market capitalisation Belgium, France UK, Spain and Germany NA Dubai NA Norway, Denmark and Finland Luxembourg and Switzerland UK, Austria, Germany, France and Luxembourg Associate 147 Associate NA Number of accounts 357, , , , , , , , ,508** Number of transactions (million) Income from operating activities Operating expenses (Adjusted) net profit P/E ratio NA NA NA Cost/income ratio 56% 68% 68% 69% 50% 64% 48% 94% 62% Data as at 31 December 2011 * Data as at 31 December 2010 ** Total number of online clients

15 The Netherlands In the Netherlands, BinckBank is the market leader with its brands Alex and Binck. Our own research shows that measured by the number of transactions, BinckBank s market share is more than 50%. BinckBank estimates that a total of between 12m and 15m private transactions are executed in the Dutch market each year. Besides BinckBank, the players in the online brokerage market include the major banks and a few relatively small discount brokers. In addition to equities, there is extensive trading in the Netherlands in options and other derivative products such as Sprinters, Turbos and Speeders. Collateralised lending is also extensively used in the Netherlands. Belgium In Belgium, BinckBank and Keytrade are neck and neck in terms of number of transactions. The total market consists of around 5m to 7.5m private transactions per year. Besides BinckBank and Keytrade, there are some smaller players in Belgium such as Bolero and Fortuneo. Belgian investors suffered heavily in the financial crisis during the past few years, partly due to the problems at Fortis and Dexia. Enthusiasm for investing declined significantly as a result. Most investors in Belgium prefer funds, and the use of collateralised lending is limited. Contrary to investors in the Netherlands and in France, Belgian investors are less inclined to purchase mainly shares of national companies. In the Netherlands and France, 80% to 90% of private investors invest in Dutch and French companies respectively. In Belgium, this figure is approximately 70%. 13 France In just three years, BinckBank has grown into the fourth-largest online broker in France, after Boursorama, Fortuneo and BourseDirect. However, many private investors in France still invest through their bank. French private investors execute approximately 30m-35m transactions each year. So far, only around 12m of these transactions are executed through online brokers with the remainder going through the major banks. This offers good potential growth opportunities for BinckBank. French investors mainly invest in warrants, and make extensive use of the Service de Règlement Différé (SRD). Italy BinckBank intends to expand further into Europe in mid-2012 by offering its services to Italian investors as well as those in the Netherlands, Belgium and France. Italy is one of the largest markets for private investors in Europe, with a total of 40m to 45m transactions executed each year. This is three times the number of transactions traded in the Netherlands. Like Dutch investors, the Italians use a lot of derivatives, especially futures. Commissions in Italy are between the levels seen in France and Belgium, and the two largest online brokers in Italy are Fineco (part of Unicredito) and IW Bank (part of UBI Banca). As in other European countries, we see that the larger providers of online investment services are increasingly developing into online banks, and are therefore losing their focus on active private investors. This presents opportunities for a specialist player like BinckBank. There are a few smaller online brokers operating in addition to Fineco and IW Bank.

16 EUROPEAN MARKETS IN WHICH BINCKBANK OPERATES THE NETHERLANDS Population: Number of Retail transactions: Online brokers: 17 million million Alex, Binck, Lynx,Today s Most traded products: Stocks, options and other derivatives BinckBank s market share: >50% BinckBank started: 1998 FRANCE THE NETHERLANDS BELGIUM BELGIUM Population: 11 million Number of Retail transactions: million Online brokers: Binck, Keytrade, Bolero and Fortuneo Most traded products: Stocks and mutual funds BinckBank s market share: Shared market leader BinckBank started: 2006 ITALY FRANCE Population: Number of Retail transactions: Online brokers: * of the online brokers 65 million million Binck, Boursorama, Fortuneo, BourseDirect Most traded products: Stocks (cash and SRD), turbos, warrants and ETFs BinckBank s market share: 16%* BinckBank started: 2008 ITALY Population: 61 million Number of Retail transactions: million Online brokers: Fineco, IW Bank, Directa Most traded products: Stocks and derivatives BinckBank s market share: - BinckBank started: Medio 2012

17 The market for Professional Services For BinckBank the service to professional parties such as independent investment managers, banks, insurance companies and pension administrators has until now been mainly focused on the Netherlands. We make a distinction within services provided to professional parties between services to independent investment managers, where BinckBank acts as a broker and custodian bank, and services to banks, insurance companies and pension administrators, where BinckBank acts as a BPO (Business Process Outsourcing) provider. Broker-custodian bank for independent investment managers Professional Services has been operating as a broker and custodian bank in the Netherlands since There are approximately 140 independent investment managers in the Netherlands. BinckBank estimates the volume of assets under management with independent investment managers at between 10 and 15 billion. Professional Services has grown strongly in recent years, becoming a dominant player in this market. The two largest custodian banks in this segment are BinckBank and Theodoor Gilissen. Other players include SNS Securities and ABN AMRO Bank, but these are much smaller. Professional Services has been operating as a broker-custodian bank in Belgium since Our estimate is that the volume of this market, measured in assets under management, is similar to that in the Netherlands. The big difference is that the number of independent investment managers, at around 25, is much lower. Professional Services is a small player in this market, which, unlike the Netherlands, still features many smaller banks. The market leader is KBC Securities. Other players include Bank DeGroof, SG Private Banking, Van Lanschot Bankiers and Keytrade. The landscape is still very fragmented, and we expect the number of players to decline as a result of increasing legislation and regulation. 15 BPO services to banks, insurance companies and pension administrators With only a few exceptions, BPO services are not provided by BPO providers on a cross-border basis. There are several reasons for this. Financial institutions are reluctant to contract parts of their business to a specialist BPO provider from another country due to a lack of adequate securities expertise in that country. In addition, hardly any securities-services systems exist that can be deployed on a cross-border basis. The difference between countries as a result of legislation and regulation is such that it is difficult to cater for this in one system. BinckBank has made a start on the work needed to upgrade its infrastructure so that it will be able to offer BPO for cross border securities services. There are large differences between countries in the willingness to outsource parts of their activities. The degree of outsourcing used by Dutch financial institutions for example is low, whereas in France it is very high. This obviously means there is a difference in the number of providers in these countries as well. Professional Services is currently more or less the only provider in the Dutch market with six financial institutions as BPO customers. We expect new players to enter this market in the coming years. KAS Bank and dwpbank (from Germany) have recently announced a joint venture that will operate in this market. We expect the arrival of new players to significantly increase the likelihood that the degree of outsourcing will increase in the Netherlands, which will create opportunities for Professional Services. In Belgium, financial institutions have always been more prepared to use outsourcing. There are currently three parties active in this area, in various ways. The Frech company Procapital and Leleux, a Belgian broker, are the leading players. Professional Services expects to welcome its first Belgian BPO customer in 2012.

18 Vision, mission, strategy and objectives Vision Ten years ago, it was still unusual to buy and sell anything over the internet, whereas today it is an everyday occurrence. Offering an online brokerage account at low cost is no longer a way to differentiate as an online broker. The expectations of private investors continue to grow, especially since the fees charged by the online providers have become more similar over the last ten years. Our conviction is that tomorrow s online broker will only be able to differentiate itself by offering high quality services and products that are transparent, simple and user-friendly. BinckBank also takes the view that such a business needs to involve its customers in its new product development process. BinckBank s DNA is an important element in achieving the customer satisfaction that we strive for. BinckBank thinks that its employees need to be service-oriented with a focus on the customer, they should work with passion and pleasure, and they should strive to be the best in everything that they do. This will lead to products and services being introduced that truly meet customer demand and maintain a high level of customer satisfaction being maintained. Among professional parties, we see increasing demand for a reliable custodian bank with low fees. Partly as a result of the credit crisis, an increasing number of banks and insurance companies are moving towards outsourcing their securities businesses, because this is not part of their core business and the operation and administrative processing of securities transactions is expensive and labour-intensive. It is moreover becoming increasingly difficult and complicated for professional parties to continue to meet the requirements of continually changing legislation and regulation in the financial sector. Professional Services is positioned to take advantage of this by taking over these operations by means of a BPO contract at competitive rates. 16 Mission Since its incorporation, BinckBank s mission has been to amaze investors by outperforming customer expectations. BinckBank continues to strive to outperform expectations in terms of products, prices and service. For instance, we aim to provide the same technical investment tools to private investors in the retail market as those available to professional investors. In the professional market, BinckBank offers partnerships to parties that allow them to enjoy the economies of scale of the BinckBank platform, to use its excellent infrastructure and assist them in complying with ever more complicated legislation and regulation. BinckBank s intention is to achieve a high level of customer satisfaction and thereby create maximum value for its customers, shareholders and other stakeholders. Our aim is that our customers should be so satisfied with our service that they become ambassadors for BinckBank. Ambition BinckBank is an online bank for investors and is one of Europe s five largest online brokers. Our ambition is to become Europe s largest online bank for investors in terms of numbers of brokerage accounts and transactions, profit and geographical scope. BinckBank started as an online broker in the Netherlands. After just over ten years, the business has grown into a large European player with offices in the Netherlands, Belgium, France, Italy and a sales office in Spain for Dutch pensioners. BinckBank takes the view that serving the largest possible number of investing customers will reduce costs per transaction and thus enable BinckBank to continue to offer competitive rates to its customers. Strengths, weaknesses, opportunities and threats BinckBank uses a SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) to identify the main features of the organisation and the environment in which it operates. This analysis forms the basis of BinckBank s strategy. Strengths and weaknesses refer to internal factors, while opportunities and threats concern developments, events and external influences to which BinckBank is exposed. The main internal and external factors are summarised in the following table.

19 Strengths, weaknesses, opportunities and threats Strengths Market leader in the Netherlands and strong positions in Belgium and France Sound financial position and low risk appetite Centralised back office and infrastructure Extensive expertise and experience in securities processing Weaknesses Reliance on a relatively small customer base Reliance on volatile transaction income High fixed cost base 17 Opportunities Private investors are making better-informed decisions regarding their financial situation Geographical expansion in Europe Trend among professional parties to outsource non-core activities Changing legislation and regulation (PPI, MiFID) Threats Macroeconomic developments Negative investor sentiment Increasing competition Changing legislation and regulation (financial transaction tax and abolition of distribution fees) Negative reputation of the banking sector BinckBank strategy Strategic objectives BinckBank has the following strategic objectives. Retaining reputation & trust BinckBank relies on the trust of its private and professional customers. Its relatively brief existence, the absolute size of its equity, the fact that the internet is its only distribution channel, its market listing and large number of customers and assets under administration makes BinckBank is sensative to trust issues. Maintaining trust and a good reputation are therefore essential. Since its incorporation, BinckBank has placed the customer s interest first and has achieved a high level of customer satisfaction. Situation at the end of 2011 BinckBank has a low risk appetite with regard to the retaining its reputation as a reliable and transparent service provider. Over the whole of 2011, our customers gave us a score of 7.6 in the customer satisfaction surveys that we conduct on a quarterly basis. The score in 2010 was 7.8 (on a scale from 1 to 10). The slight decline was mostly due to the not entirely trouble-free migration of the Dutch Binck customers to the European Retail base platform in March 2011 and the system outages at Alex and Binck in July and August. The system outages were dealt with as quickly as possible within 24 hours and BinckBank largely compensated its customers for losses incurred. In 2012 BinckBank will continue to focus on raising the level of customer satisfaction, with our target being to achieve a score of 8 from our customers in the satisfaction surveys.

20 Extension of online brokerage (Retail) BinckBank s net fee and commission income is mainly driven by its online brokerage operations (income from transactions) of the Retail business unit. In order to generate further growth in commission income, BinckBank intends to extend its online brokerage business by means of: Further growth in the Netherlands, Belgium and France through the introduction of new products and services; and Further European expansion, starting with Italy. BinckBank wants to expand in geographical terms because economies of scale will be necessary to remain competitive in the long term. Our fixed costs can then be spread across more customer groups and countries, allowing us to keep the cost per transaction as low as possible. Our preferred model for international growth is a combination of a greenfield operation (starting from scratch) and accelerated growth by means of add-on acquisitions if suitable opportunities for this arise. This clearly depends on local conditions in the market in question. If opportunities for acquisitions arise in markets in which BinckBank is not yet active, these will also be considered. Situation at the end of 2011 BinckBank succeeded in achieving substantial growth in 2011 in the number of accounts in the Netherlands (+24,977 brokerage accounts, +10%), Belgium (+11,433 brokerage accounts, +28%) and France (+13,772 brokerage accounts, +56%). The number of transactions rose 10%, from 8.9m in 2010 to 9.7m in 2011, 7.1m of which were executed by our Dutch customers, 1.0m by our Belgian customers and 1.6m by our French customers. 18 Expansion outside the online brokerage chain: pension accrual and asset management services One of BinckBank s objectives is to further expand the services it provides to include pension accrual and asset management activities, whereby the business model will focus on the management and administration of assets. This should lead to a more stable income flow. Situation at the end of 2011 The assets under management at Alex Asset Management rose in 2011, despite the sharp fall in the stock markets, from 610m to 690m. The number of accounts increased by 31% to 19,007. After the incorporation of BeFrank on 6 July 2010, the legislation for the Premium Pension Institution (PPI) took effect on 1 January On 24 June 2011, BeFrank was the first PPI in the Netherlands to obtain a licence from De Nederlandsche Bank (DNB), and it formally started to offer its service on 1 July In September, BeFrank won a Gouden Schild award for Pension product of the Year. So far, 20 employers with a total of more than 4,000 employees have decided to place their pension schemes with BeFrank. We expect competition in this area to intensify rapidly with the arrival of a number of new PPIs. With an excellent service, innovation and product development, BeFrank expects to differentiate itself from the other PPIs and expects to be able to meet its customers needs. BeFrank will thus be able to maintain and further build on its advantage. ThinkCapital introduced four new tracker funds in These four trackers will also be offered as a passive investment option by the pension discounter BeFrank. In November, one of these four new trackers, the Think Global Equity Tracker, won a Gouden Stier award in the Product of the Year category. This helped the assets under management at ThinkCapital to grow from 20m to 70m. Continued growth at Professional Services Professional Services offers the following services: Services to independent investment managers; BPO services to banks, insurance companies and pension administrators; and An independent broking desk. BinckBank intends to expand its activities further in the Netherlands and Belgium. Professional Services has been offering business process outsourcing (BPO) services since Under a BPO contract, Professional Services takes full responsibility for the execution of securities orders, administration and securities-related payments. A BPO contract is usually concluded for a term of 5 to 7 years and carries a minimum annual fee. This generates recurring and therefore more stable income for BinckBank.

21 Situation at the end of 2011 Professional Services concluded two new BPO contracts in 2011 and its assets under administration increased from 4.4 billion to 5.1 billion. Professional Services currently serves around 90 independent investment managers and, once all the current contracts have been implemented, a total of six BPO partners. Optimising operational efficiency and continuity of services BinckBank s strategic objective is to use its existing infrastructure efficiently by settling as many transactions as possible at a low transaction cost in order to be able to keep on offering competitive prices to its customers. Economies of scale as a result of high transaction volume are necessary in order to be able to remain competitive in the long term. It is thus important that BinckBank achieves as high a transaction volume as possible. Transaction volume can be increased in various ways: growth of the number of accounts in existing markets; the introduction of new transaction-generating products and services; giving professional parties access to BinckBank s infrastructure (BPO services and independent investment managers); and connecting new countries to the existing infrastructure. Situation at the end of Centralised back office and infrastructure BinckBank has its centralised back office and infrastructure in Amsterdam where all transactions are settled, including those executed in Belgium and France. This central organisation for the settlement of securities transactions and the administration of securities positions is highly efficient, and allows us to achieve low costs per transaction. Various projects in 2011 focused on improving the quality and efficiency of the infrastructure and the back office. In 2012 BinckBank will continue to develop its European Retail base platform, so that more European markets can be serviced in future, the time-to-market for the introduction of new products and services can be reduced and the costs can be spread across more countries. Foreign branches with low fixed costs BinckBank uses local branches for its foreign operations. These branches have low fixed costs, since the activities they perform are more or less restricted to front office (sales and customer service) and compliance activities. This allows the local branches to focus entirely on their customers. It is essential that these activities are placed close to the customer, since this makes it possible to provide the best possible customer service and to tailor the products and services offered to meet the wishes and needs of the private investors in the various markets. The other activities, which mainly concern ICT and back office, are organised centrally in the Netherlands. Constant focus on cost control At BinckBank we are convinced that operational excellence is the key to controlling costs. Continually working on structural improvements to our business methods and processes makes it possible for us to control our costs. BinckBank strives to achieve a cost/income ratio excluding IFRS depreciation of approximately 50%. In 2011, this ratio was 56%. The increase compared to 2010 was mainly due to investment in the growth and quality of the business necessary to enable BinckBank to grow from a market leader in the Netherlands into a European player. Expertise BinckBank employees have accumulated extensive expertise in the settlement and administration of securities transactions over the last few years, which greatly benefits the efficiency and continuity of our service. Conservative financial policy BinckBank follows a conservative financial policy and is moreover conservative with regard to investing the customer funds entrusted. The aim of capital management at BinckBank is to maintain a sound solvency and liquidity position, seeking constantly to strike the right balance between the equity capital it holds, the return it can realise and the risks to which it is exposed.

22 Situation at the end of 2011 As at 31 December 2011, the capital and liquidity position of BinckBank was sound. BinckBank s total equity at the end of 2011 stood at 469.5m. The total available Tier 1 capital increased from 131.3m to 160.7m in The BIS ratio rose from 23.9% to 31.1%, and the solvency ratio rose further from 15.7% to 23.1%. Attractive return for shareholders BinckBank strives to achieve an attractive Total Shareholder Return (TSR) (price appreciation + dividend) for its shareholders. Situation at the end of 2011 The proposed dividend per share for 2011 is 0.44 (FY ), which means a dividend yield of 5.3% with a year-end share price of 8.33 (FY10 4.4%). BinckBank shares opened 2011 at a price of 11.70, and closed the year at The decline in the BinckBank share price in 2011 was partly due to the financial crisis in Europe and the uncertainty surrounding the possibility of a financial transaction tax being imposed. Compliance with changing legislation and regulation BinckBank operates in regulated and supervised markets in which all stakeholders have to receive the correct service. BinckBank must continually comply with the rapidly changing legislation and regulation in the financial sector, which has the effect of increasing costs. Situation at the end of 2011 BinckBank continuously has internal projects running to ensure that it can continue to comply with changing legislation and regulation. No significant compliance issues occurred in The MiFID took effect in the European Union on 1 November MiFID stands for the Markets in Financial Instruments Directive. The directive has three objectives: The protection of investors and the integrity of the financial markets; The promotion of fair, transparent, efficient and integrated financial markets; and The further harmonisation of European stock markets and investment markets. To comply with MiFID, BinckBank together with Optiver incorporated TOM (The Order Machine). Institutional parties had already had access to various alternative markets for a number of years. TOM now searches various markets to find the best prices for private investors; this means that private investors are no longer fully dependent on NYSE Euronext. TOM started with the facilitation of trading in equities last year. This progressed satisfactorily, and led to better prices for our customers. The average benefit for transactions executed at a better price through TOM is 4 to 5 per order for active customers. The start of options trading was delayed, in part because NYSE Euronext refused to grant TOM Smart Execution a Liffe membership. After obtaining membership through successful legal action, TOM began offering trading in the first options series for private investors at the end of November. The offering will be expanded further in BinckBank customers are thus benefiting optimally from the advantages of Best Execution. Corporate social responsibility By means of corporate social responsibility (CSR), BinckBank strives to retain and encourage sustainable confidence in its activities. The fundamental principle in our CSR policy is to place the customer s interest first. The CSR policy is integrated in BinckBank s services and is taken into consideration in the decision-making process with regard to innovations and product renewal. Situation at the end of 2011 Consistent with its CSR policy, BinckBank devoted attention last year to promoting socially responsible investing to its customers, by offering socially responsible investment funds and giving these funds a prominent place on the website. With the Alex Academy, BinckBank offers mostly free education to support investors so that they have a better basis on which to make their decisions. BinckBank moreover increased the transparency regarding its CSR activities by issuing a detailed account thereof (see p of this annual report).

23 Objectives for year-end 2013 In 2009, BinckBank formulated the following targets in order to achieve its ambition of becoming Europe s largest online bank for investors. Goals for year-end 2013 Realisation year-end 2011 Realisation year-end 2011 in % Dutch Retail brokerage accounts 330, ,187 81% Belgian Retail brokerage accounts 90,000 52,340 58% French Retail brokerage accounts 80,000 38,237 48% Number of BPO agreements % Total savings assets 1.5 billion 519 million 35% Total administrated assets 15 billion 14 million 91% The growth in number of accounts in the Netherlands and France is slightly below that needed to achieve the targets by the end of We expect growth to pick up in the Netherlands once investor sentiment improves. In France, we expect growth in the number of opened brokerage accounts to accelerate in the next two years, now that BinckBank is gaining an increasingly strong position in the French market and BinckBank is more and more frequently cited as one of the best brokers in the various broker surveys. In Belgium, we are seeing a decline in enthusiasm for investing as a result of the crisis in Europe which has hit private investors in Belgium particularly hard. The number of new brokerage accounts is therefore behind the schedule for achieving the target by The extent to which this target is realised will be followed closely. 21 BinckBank needs to conclude two BPO contracts a year in order to realise its target of ten BPO contracts by year-end Demand for this service is developing positively. At the end of 2011, BinckBank had concluded six of these contracts, putting it exactly on schedule. The savings market in the Netherlands has been affected in the last few years by the troubles in Europe and the banking crisis. As a result of its low risk appetite and the fact that it has no traditional lending business, BinckBank is unable to compete with the increases in interest paid by other financial institutions on savings accounts. On the one hand, the distortions in the money and capital markets have made it difficult for many financial institutions to meet their funding needs through the professional market, which made them offer higher interest rates on private savings. On the other hand, the current financial conditions are allowing them to still charge relatively high interest rates on loans to their customers.

24 Information for shareholders BinckBank shares are listed on NYSE Euronext Amsterdam and since 1 March 2006 have formed part of the Amsterdam Midkap Index (AMX), with a weight of 2.31% in this index on 31 December ISIN code: NL Reuters: BINCK AS Bloomberg: BINCK NA Options on BinckBank shares have been traded since 21 March The average number of shares traded daily in 2011 was 252,815. BinckBank shares are followed by ten parties, whose recommendations to institutional and private investors regarding BinckBank shares are shown below. Coverage of BinckBank shares Company Analyst Recommendation Price target ABN AMRO Jan Willem Weidema Hold 9.75 ING Albert Ploegh and Marchen Altena Buy KBC Dirk Peeters Accumulate Kempen & co Floris Oliemans Buy Kepler Capital management Benoit Pétrarque Hold Petercam Matthias de Wit Buy Rabo securities Cor Kluis Buy RBS Thomas Nagtegaal Hold 9.50 SNS securities Lemer Salah Buy Theodoor Gilissen Tom Muller Buy on 8 March 2012 Key figures for BinckBank shares Earnings per share Adjusted earnings per share Dividend per share* Dividend yield in % (based on year-end closing quote) 5.3% 4.4% 4.1% 7.5% Net asset value Year-end share price BinckBank N.V AMX index P/E ratio * 2011 figures are subject to approval of the General Meeting of Shareholders

25 Share capital Authorised ordinary shares 100,000, ,000, ,000, ,000,000 Issued shares previous year-end 74,500,000 76,068,928 77,093,508 77,093,508 Number of shares issued during the year Number of shares cancelled during the year - 1,568,928 1,024,580 - Issued shares year-end 74,500,000 74,500,000 76,068,928 77,093,508 Buy-back shares 122,097-2,070,509 1,053,442 Number of priority shares Average number of shares outstanding during the year 74,142,108 74,080,625 74,897,706 76,870,870 Market capitalisation year-end 620,585, ,200, ,904, ,159,619 BinckBank shares in 2011 The stock markets were extremely volatile in 2011, especially in the first and third quarters, and closed ultimately with a loss. The AMX started the year at 639 points and finished at 468 points. Like the majority of other listed stocks, BinckBank shares were affected by the turmoil in the European financial markets, starting 2011 at and closing the year at BinckBank vs AMX 160% 140% 120% 100% 80% 160% 140% 120% 100% 80% 60% 60% 40% 40% 20% 20% 0% 0% Jan-08 Mrt-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mrt-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mrt-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mrt-11 May-11 Jul-11 Sep-11 Nov-11 BinckBank AMX

26 Share price & volumes Opening price Highest price Lowest price Closing price Share turnover 64,973,343 86,610,504 69,509,627 90,492,493 Turnover high 924,395 4,844,483 1,215,751 2,287,767 Turnover low 53,902 44,598 32,437 24,802 Average daily turnover 252, , , , The BinckBank share price declined during the year, especially in May, June and July. The decline was mainly due to the debt crisis in Europe that resulted from the debt situation in Greece. Many European financial stocks were shunned by investors for this reason. The fall was made worse by the low volatility in the stock markets in the spring of 2011, which had a negative effect on BinckBank s quarterly result. The crisis in the eurozone was an important factor throughout the year. Many investment funds experienced cash outflows and were forced to sell shares. BinckBank is a bank, and despite the fact that it has no lack of capital or liquidity, its shares were pulled down due to the problems at other financial institutions. The possibility that a financial transaction tax would be introduced also influenced the share price. BinckBank closed 2011 at BinckBank share movements and volumes share price September 2008: Launch of share buy-back programme 10 October 2008: Lowest share price ever : Record year for BinckBank in terms of number of transactions and profit 26 April 2010: First-quarter results lower than expected by analysts May 2010: Financial crisis 25 October 2010: Better than expected third-quarter results and takeover rumours 27 April 2011: CEO and CFO invest entire variable performance fee in BinckBank shares Spring and summer 2011: Start of the European crisis with Greek debt situation and the escalation of the European debt crisis. 60,000 50,000 40,000 30,000 20,000 Volume December 2011: BinckBank resumes its share buy-back programme 10, Dec Apr Aug Dec Apr Aug Dec Apr Aug Dec Apr Aug Dec Feb Jun Oct Feb Jun Oct Feb Jun Oct Feb Jun Oct-11 Share buy-back programme BinckBank reinstated its share buy-back programme on 16 December BinckBank started the programme on 30 September 2008 with the intention of reducing its capital. As a result of rapid growth of the risks in the balance sheet and the prospect of stricter capital requirements (details of which were not known at the time), the previous buy-back programme was suspended indefinitely on 22 December Now that we have a clearer picture of the new capital requirements and BinckBank s solvency ratio rose above 20% in the fourth quarter, we have decided to reinstate the share buy-back programme. Between 16 and 31 December 2011, a total of 122,097 shares were repurchased at an average price of BinckBank expects to repurchase shares to a total value of 28m over a period of 18 months, subject to the actual or forecast solvency ratio remaining above 20%.