1. MB Financial Bank Windy City Summit June 8, 2012 Sustainable Treasury Management: Going Green Can Save You Green

2. 2 Agenda Situation Analysis Top Trends Working With Your Bank Resources

3. 3 Before We Begin Two reminders before we begin today This is not a presentation about changing light bulbs or recycling water bottles. Although change begins with simple tasks and low hanging fruit, we will focus on the Treasury Management industry and trends in the business community at large. Sustainable Treasury Management does not just apply to Fortune 500 companies. You will learn that in many cases, small businesses are more involved with and better leveraged to implement go green and eco-friendly campaigns. Sustainable Treasury Management impacts all areas of the business community

4. 4 Situation Analysis – Environmental Fast Facts  Each year, Americans throw away enough paper and plastic cups, spoons, forks, and knives to circle the Earth 300 times  Recycling one ton of paper saves the energy equivalent of 185 gallons of gasoline  Recycling 1 million laptops saves enough energy to power 3,657 homes for an entire year  It takes 90% less energy to recycle aluminum cans than to produce new ones  Making 2,000 pounds of paper from recycled paper saves up to 17 trees and uses 50% less water than creating paper from original pulp  Over 1.7 million tons of plastic water bottles are produced annually in the U.S. requiring the energy equivalent of over 500 million barrels of oil – approximately 75% of those bottles are not recycled Aluminum cans can take up to 500 years to decompose, but only 6 weeks to recycle Clean Air Council, 2012

5. 5 Situation Analysis – What is Sustainable Treasury? Sustainable Treasury Management is the concept of deploying an overall program or strategy that supports environmentally friendly or green initiatives throughout business operations including:  Paper reduction  Electronification and automation  Alternate and renewable energy sources  Recycling and waste management  Process improvement  Product and technology innovation  Construction, transportation, and logistic redesign  Employee engagement and education There are several different components to a sustainable Treasury Management program

6. 6 Situation Analysis – Why Sustainable Treasury? There are several factors influencing businesses that have ignited the sustainable Treasury Management movement:  Cost reduction initiatives  Regulatory guidelines and enforcement  Eco-labels and certifications  Energy, waste, and resource efficiencies  The electronic world at large  Political and social pressure  Competitive advantages Businesses are moving beyond desire and compliance to competitive advantage

7. 7 Situation Analysis – Sustainable Treasury Landscape Sustainable Treasury Management is growing across all businesses and all industry segments. However, the market is seeing a pull from the top and the bottom between large and small companies which is squeezing the mid sized companies who are more followers.  Large businesses (over 10,000 employees)  More resources, support many segments, top down management support  Small businesses (less than 500 employees)  Nimble, product or industry focused, grass roots movement  Strategic focus on eco-friendly initiatives in targeted industries  Highly regulated, manufacture specific products, manage waste  Automotive, Energy, Transportation, Farming, Hospitality, Retail Green agendas are growing across all businesses and all industry segments

8. 8 Situation Analysis – Corporate Go Green Strategies Corporate Treasury Go Green strategies can be looked at in three different categories  Passive  Reactive, one off projects, no real strategy or business plan  Active  Formal sustainability program, employee engagement, commitment to community footprint  Aggressive  Internal personnel dedicated to Go Green, formal policies with customers and local businesses, proven industry leadership Go Green strategies differ by organization and industry segments

9. 9 Situation Analysis – Challenges to Sustainable Treasury Adoption  There continues to be a high resistance to change  Overall education on business impacts and savings is limited Cost  There can be significant up front costs to sustainable Treasury  New technologies carry higher price tags to implement and maintain Infrastructure  The U.S. is not yet setup for the next generation alternative energy solutions  Many eco-friendly initiatives are in development or on hold due to social or political issues Businesses must weigh out the benefits and challenges in their overall strategies

10. 10 Situation Analysis - Survey Corporate sustainability programs are becoming more commonplace in the industry Treasury & Risk, 2011 QuestionYesNoDon’t Know Has your company assessed it’s carbon footprint? 28.6%44.2%27.2% Does your company have a formal sustainability program or strategy? 51.7%36.7%11.6% Do you view your financial institution relationships as partners in a sustainable treasury strategy? 49.0%32.2%18.9% Are your company’s environmental strategies integrated with its business plan? 39.4% 21.2% Do you feel that by going green, your company will have a competitive edge in the marketplace? 39.7%38.9%21.4%

11. 11 Top Trends – Alternate and Renewable Energy Sources Businesses are looking for alternate sources to power and operate their buildings, plants, warehouses, and all facilities in order to reduce long term costs and eliminate carbon dioxide emission.  Solar  Wind  Hydroelectric  Geothermal  Biomass Alternative energy sources eliminate carbon dioxide which contributes to global warming

12. 12 Top Trends – Paper Reduction There has been on ongoing trend to reduce paper in the workplace for the last 15 years. However, paper continues to be part of the business world as well as the medium of choice for many industries.  Recycle all paper and cardboard  Purchase new paper with the following attributes:  Recycled materials, chlorine free, mercury free  Print documents as double sided print outs  Replace paper cups and utensils with reusable materials  Use paper towels and tissues with recycled materials  Read documents online and suppress all paper related statements and management reports  Suppress annual reports and 10K reports and make available online Removing paper in the workplace is a key area for businesses to reduce costs

13. 13 Top Trends – Recycling and Waste Management Recycling and disposing of waste in an efficient manner is a key component of any sustainability program.  Recycle all materials that can be recycled  Paper, cardboard, glass, metals, plastic, electronics  Keep recycle bins and containers near copy machines, printers, break rooms, and restrooms  Dispose, collect, and remove waste efficiently  Donate or dispose large or high volumes of items like equipment and furniture Recycling and properly disposing waste is crucial to meeting green goals

14. 14 Top Trends – Transportation Rising fuel costs and the proliferation of suburban living has increased the amount of travel time and expenses in all areas of business logistics.  Telecommuting/Remote offices  Teleconferencing  Carpooling  Public transportation  Alternative methods  Biking  Walking To meet the logistical demands of the current and future business environment, alternatives to traditional means are necessary

15. 15 Top Trends – Construction Businesses are re-engineering how facilities and properties are developed and demanding more eco-friendly construction from owners.  Eco-friendly materials  Reused and refurbished  Green landscaping  Organics  Automatic lighting and thermostats  Sealed doors and windows  Powered by alternate or renewable energy sources Long term sustainability begins with the buildings that house raw materials and employees

16. 16 Top Trends – Office Management The easiest way to begin a go green strategy is to start with human capital.  Employee rewards and programs  Junk mail reduction  Recycling centers  Green landscaping/Indoor plants  Green cleaning/Non-toxic products  Telecommuting/Remote offices  eNewsletters The most successful sustainability programs start from the bottom up

17. 17 Top Trends – Technology Moving from legacy mainframe and software based systems to the cloud is becoming essential to reduce overall support and energy costs.  Reduction in server farms and systems  Decrease in backup and storage costs  Elimination of installations and use of CDs and DVDs  Efficient deployment of new applications and programs  Save energy  Less facilities to store hardware  Reduce temperature cooling for rooms The faster businesses move to the cloud, the faster they realize savings

18. 18 Top Trends – Carbon Footprint and Offsets Businesses are becoming more aware of their carbon footprint and using sophisticated tools to calculate and analyze their overall carbon dioxide (CO2) emissions. In addition, the use of carbon offset programs is gaining ground.  Carbon footprint  Carbon offset Carbon footprinting and using offset credits is a key component of any green strategy

19. 19 Top Trends – Carbon Footprint Calculation and Analysis Businesses are applying scientific methods to determine their overall carbon footprint

20. 20 Top Trends – Cash Management and Banking Businesses are seeking partnerships with their financial institutions to meet their sustainable Treasury Management goals and green initiatives.  Paper to electronic migration  Elimination of paper statements, notices, and advices  Online banking  Reporting, Transaction initiation, Notifications  Archive and data retrieval  Back office system automation and integration Financial institutions are uniquely positioned to partner with customers on green initiatives

21. 21 Situation Analysis - Survey Corporate sustainability programs are becoming more commonplace in the industry Treasury & Risk, 2011 QuestionYesNoDon’t Know Has your company assessed it’s carbon footprint? 28.6%44.2%27.2% Does your company have a formal sustainability program or strategy? 51.7%36.7%11.6% Do you view your financial institution relationships as partners in a sustainable treasury strategy? 49.0%32.2%18.9% Are your company’s environmental strategies integrated with its business plan? 39.4% 21.2% Do you feel that by going green, your company will have a competitive edge in the marketplace? 39.7%38.9%21.4%

22. 22 Online Banking Solutions Online banking platforms offer several modules that help businesses manage treasury functions in a safe and secure session by eliminating paper statements and providing all reports online  Information Management  Prior day, current day, multi-currency, historical transaction reports  Payment Initiation  ACH, Wire Transfer, Internal Transfer  User Administration  User entitlements and permissions, dollar limit restrictions  Alert Notifications  Data Archive  Other Modules  Lockbox, Remote Deposit Capture, File Management Are you utilizing all of the online banking options available beyond basic features?

23. 23 Payables Solutions  Automated Clearing House (ACH)  Direct deposit of payroll, vendor payments, employee reimbursement, tax payments  Wire Transfer  Vendor payments  Internal Transfer  Positive Pay  F/X Payments  Business Credit Card  Low dollar payments, travel and entertainment Payables solutions reduce costs by migrating paper checks to electronic payments and automate processes to manage all payments online

24. 24 Receivables Solutions  Automated Clearing House (ACH)  Premiums, dues, subscriptions  Wholesale Lockbox  Business to Business (B2B)  Retail Lockbox  Consumer to Business (C2B)  Remote Lockbox  Remote Deposit Capture  Intelligent Safes Receivables and collections solutions eliminate incoming paper and send electronic data files for reconciliation and settlement

25. 25 Overall Go Green Solutions  Paper to Electronic (P2E) Migration  Payables/Disbursements  Receivables/Collections  Reports and Statements  Eliminate all paper statements and checks  Review all bank accounts online  Archive and Retrieval  Generate all special reports online  Search for transactions and specific items  Stored data and reports  Automation and Integration  File transfer (inbound/outbound) P2E migration, online reporting and data archive and retrieval and automation and data integration are all key components to any sustainable Treasury Management strategy

26. 26 Resources Pay it Green - http://www.payitgreen.org/http://www.payitgreen.org/ Environmental Protection Agency - http://www.epa.gov/http://www.epa.gov/ The Green Office - http://www.thegreenoffice.com/http://www.thegreenoffice.com/ Treasury & Risk 2011 Going Green Survey Results - http://media.treasuryandrisk.com/treasuryandrisk/article/2011 /07/25/TR%20July11SurveyResults.pdf http://media.treasuryandrisk.com/treasuryandrisk/article/2011 /07/25/TR%20July11SurveyResults.pdf JP Morgan White Paper Green Treasury Operations - http://www.jpmorgan.com/tss/General/Creating_A_Green_Tre asury_Operation_Is_Easier_Than_You_Think/1271975461438 http://www.jpmorgan.com/tss/General/Creating_A_Green_Tre asury_Operation_Is_Easier_Than_You_Think/1271975461438 Carbon Footprint Business Analysis - http://www.epa.gov/climateleadership/smallbiz/footprint.html http://www.epa.gov/climateleadership/smallbiz/footprint.html Business Carbon Footprint Calculator - http://carbonfootprint360.com/p/business-carbon-footprint- calculator.html http://carbonfootprint360.com/p/business-carbon-footprint- calculator.html