Exhibit 99.1

GRUPO FINANCIERO GALICIA S.A.

CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

GRUPO FINANCIERO GALICIA S.A.

CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

TABLE OF CONTENTS

CONSOLIDATED CONDENSED INTERIM BALANCE SHEET	2
CONSOLIDATED CONDENSED INTERIM INCOME STATEMENT	4
CONSOLIDATED CONDENSED INTERIM STATEMENT OF OTHER COMPREHENSIVE INCOME	5
CONSOLIDATED CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY	6
CONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS AND CASH EQUIVALENTS	8
NOTE 1. ACCOUNTING STANDARDS AND BASIS FOR PREPARATION	10
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES	25
NOTE 3. TRANSITION TO IFRS	26
NOTE 4. FINANCIAL ASSETS AND LIABILITIES	38
NOTE 5. EQUITY INVESTMENTS AND RELATED PARTIES	42
NOTE 6. INFORMATION ABOUT THE SHAREHOLDERS’ EQUITY AND THE STATEMENT OF CASH FLOWS	45
NOTE 7. NON-FINANCIAL ASSETS	46
NOTE 8. OTHER DISCLOSURES REQUIRED BY IFRS	47
NOTE 9. INCOME STATEMENT BREAKDOWN	53
NOTE 10. ADDITIONAL INFORMATION REQUIRED BY THE ARGENTINE CENTRAL BANK	55
SCHEDULE A – BREAKDOWN OF GOVERNMENT AND PRIVATE SECURITIES	71
SCHEDULE B – CLASSIFICATION OF LOANS AND OTHER FINANCING ACTIVITIES BY STATUS AND GUARANTEES RECEIVED	73
SCHEDULE C – CONCENTRATION OF LOANS AND OTHER FINANCING ACTIVITIES	75
SCHEDULE D – BREAKDOWN BY TERM OF LOANS AND OTHER FINANCING ACTIVITIES	76
SCHEDULE F – CHANGES IN PROPERTY, PLANT AND EQUIPMENT	77
SCHEDULE G – CHANGES IN INTANGIBLE ASSETS	78
SCHEDULE H – CONCENTRATION OF DEPOSITS	79
SCHEDULE I – BREAKDOWN OF FINANCIAL LIABILITIES BY REMAINING TERM	80
SCHEDULE J – CHANGES IN PROVISIONS	81
SCHEDULE L – FOREIGN CURRENCY BALANCES	82
SCHEDULE O – DERIVATIVE INSTRUMENTS	84
SCHEDULE R – VALUE ADJUSTMENT BY LOSSES – ALLOWANCE FOR LOAN LOSSES	85
ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017	86
INFORMATIVE REVIEW AS OF SEPTEMBER 30, 2018	104
SEPARATE CONDENSED INTERIM BALANCE SHEET	109
SEPARATE CONDENSED INTERIM INCOME STATEMENT	110
SEPARATE CONDENSED INTERIM STATEMENT OF OTHER COMPREHENSIVE INCOME	110
SEPARATE CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY	111
SEPARATE CONDENSED INTERIM STATEMENT OF CASH FLOWS AND CASH EQUIVALENTS	112

GRUPO FINANCIERO GALICIA S.A.

NOTE 1. ACCOUNTING STANDARDS AND BASIS FOR PREPARATION	113
NOTE 4. FAIR VALUES	127
NOTE 5. EQUITY INVESTMENTS AND RELATED PARTIES	128
NOTE 6. INFORMATION ABOUT THE SHAREHOLDERS’ EQUITY AND THE STATEMENT OF CASH FLOWS	130
NOTE 7. NON-FINANCIAL ASSETS	131
NOTE 8. OTHER DISCLOSURES REQUIRED BY IFRS	131
NOTE 9. INCOME STATEMENT BREAKDOWN	133
NOTE 10. ADDITIONAL INFORMATION REQUIRED BY THE ARGENTINE CENTRAL BANK	134
SCHEDULE A – BREAKDOWN OF GOVERNMENT AND PRIVATE SECURITIES	137
SCHEDULE F – CHANGES IN PROPERTY, PLANT AND EQUIPMENT	138
SCHEDULE L – FOREIGN CURRENCY BALANCES	139
ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017	140
ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS	147
SUPPLEMENTARY AND EXPLANATORY STATEMENT BY THE BOARD OF DIRECTORS	149
REPORT OF THE SUPERVISORY SYNDICS’ COMMITTEE	151
INDEPENDENT AUDITOR’S LIMITED REVIEW REPORT	154
INDEPENDENT AUDITOR’S LIMITED REVIEW REPORT	157

GRUPO FINANCIERO GALICIA S.A.

CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Fiscal Year No. 20, commenced January 1, 2018

Legal Domicile: Tte. Gral. Juan D. Perón No. 430 – 25th floor, Buenos Aires – Argentina -

Principal Line of Business: Financial and Investment Activities

Registration No. with the Corporation Control Authority (I.G.J.): 12,749

Sequential Number – Corporation Control Authority (I.G.J.): 1,671,058

Date of Registration with the Corporation Control Authority (I.G.J.):

Of Bylaws: September 30, 1999

Date of Latest Amendment to Bylaws: July 16, 2010

Date of Expiration of the Company’s Bylaws: June 30, 2100

Information on the Controlling Company:

Company’s Name: EBA HOLDING S.A.

Principal Line of Business: Financial and Investment Activities

Interest Held by the Controlling Company in Shareholders’ Equity as of 09.30.18: 19.71%

Interest Held by the Controlling Company in Votes as of 09.30.18: 55.11%

Capital Status as of 09.30.18 (Note 6):

Figures Stated in Thousands of Pesos, except for “Amount” and “Voting Rights per Share”

Shares
Amount	Type	Voting Rights per Share	Subscribed	Paid-in	Registered
281,221,650	Ordinary Class “A”, Face Value of 1	5	281,222	281,222	281,222
1,145,542,947	Ordinary Class “B”, Face Value of 1	1	1,145,543	1,145,543	1,145,543
1,426,764,597			1,426,765	1,426,765	1,426,765

1

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM BALANCE SHEET

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Notes		09.30.18		12.31.17		01.01.17
Assets
Cash and Bank Deposits		6		116,815,471		58,943,266		65,767,565
Cash				22,198,631		8,783,324		7,335,069
Financial Institutions and Correspondents				94,616,840		50,159,942		58,432,496
Argentine Central Bank (B.C.R.A.)				91,084,894		49,296,177		55,927,231
Other Local and Foreign Financial Institutions				3,531,946		863,765		2,505,265
Fair Value Debt Securities with Changes to Income (Schedule A)		4		22,562,575		28,978,240		16,289,564
Derivative Instruments		4		3,832,409		537,000		124,521
Repo Transactions				14,145,620		9,676,101		-
Other Financial Assets				22,503,073		7,057,841		3,637,971
Loans and Other Financing Activities (Schedules B, C, D, R)				293,939,831		192,767,327		133,882,276
Non-financial Public Sector				555		5,795		14,359
Argentine Central Bank				5,749		2,441		2,886
Other Financial Institutions				8,782,401		4,661,902		2,752,463
To the Non-financial Private Sector and Residents Abroad				285,151,126		188,097,189		131,112,568
Other Debt Securities (Schedules A, B, C and D)				15,865,750		2,708,652		961,963
Financial Assets Pledged as Collateral		4		9,338,469		6,330,557		5,478,854
Current Income Tax Assets				1,938,429		194,805		126,115
Investments in Equity Instruments (Schedule A)				132,032		75,806		101,563
Investments in Subsidiaries, Associates and Joint Ventures				-		-		155,669
Property, Plant and Equipment (Schedule F)		7		10,522,492		9,790,398		8,531,551
Intangible Assets (Schedule G)		7		1,111,815		905,861		831,104
Deferred Income Tax Assets		8		788,719		563,204		563,412
Other Non-financial Assets				4,060,985		2,852,608		2,252,995
Non-current Assets Held for Sale		7		243,563		5,885,054		5,926,083
Total Assets				517,801,233		327,266,720		244,631,206

The accompanying Notes and Schedules are an integral part of these consolidated condensed interim financial statements.

2

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM BALANCE SHEET (Continued)

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	Notes		09.30.18			12.31.17		01.01.17
Liabilities
Deposits (Schedules H and I)				320,052,389			200,716,904		150,377,065
Non-financial Public Sector				4,855,358			1,164,127		1,294,439
Financial Sector				564,160			115,152		62,957
Non-financial Private Sector and Residents Abroad				314,632,871			199,437,625		149,019,669
Fair Value Liabilities with Changes to Income		4		385,031			-		-
Derivative Instruments				6,624,894			584,856		157,599
Repo Transactions (Schedule I)				-			1,131,127		1,644,715
Other Financial Liabilities (Schedule I)				57,955,861			37,488,925		31,299,292
Loans from the Argentine Central Bank and Other Financial Institutions (Schedule I)				26,456,749			7,869,048		6,896,317
Notes Issued (Schedule I)		10		26,794,259			13,739,066		11,857,718
Current Income Tax Liabilities				4,798,850			3,071,688		1,822,149
Subordinated Notes (Schedule I)		10		10,356,588			4,828,018		4,065,255
Provisions (Schedule J)		8		1,481,374			607,455		384,876
Deferred Income Tax Liabilities		8		113,522			691,043		938,269
Other Non-financial Liabilities				10,618,068			13,390,227		10,572,861
Total Liabilities				465,637,585			284,118,357		220,016,116
Shareholders’ Equity		6
Capital Stock				1,426,765			1,426,765		1,300,265
Non-capitalized Contributions				10,951,132			10,951,132		219,596
Capital Adjustments				278,131			278,131		278,131
Profit Reserves				25,024,870			17,390,568		12,536,831
Retained Income				2,819,823			2,526,325		-
Other Accumulated Comprehensive Income (Loss)				(61,172	)		17,279		284,182
Net Income for the Period/Year				9,999,213			8,622,967		8,544,202
Shareholders’ Equity Attributable to the Controlling Company’s Shareholders				50,438,762			41,213,167		23,163,207
Shareholders’ Equity Attributable to Non-controlling Interests				1,724,886			1,935,196		1,451,883
Total Shareholders’ Equity				52,163,648			43,148,363		24,615,090

The accompanying Notes and Schedules are an integral part of these consolidated condensed interim financial statements.

3

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM INCOME STATEMENT

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	Notes	Three-month Period Ended 09.30.18			Three-month Period Ended 09.30.17			Nine-month Period Ended 09.30.18			Nine-month Period Ended 09.30.17
Interest Income	9		18,590,656			8,616,775			42,924,848			24,846,941
Interest Expense	9		(10,845,920	)		(3,778,003	)		(22,267,745	)		(11,087,722	)
Net Income from Interest			7,744,736			4,838,772			20,657,103			13,759,219
Commission Income	9		5,589,790			4,019,680			15,070,914			11,849,312
Commission Expense	9		(814,905	)		(439,977	)		(1,998,097	)		(1,601,706	)
Net Commission Income			4,774,885			3,579,703			13,072,817			10,247,606
Net Income from Measurement of Fair Value Financial Instruments with Changes to Income	9		5,191,642			1,501,055			8,813,999			3,444,611
Income from Derecognition of Assets Measured at Amortized Cost			26,635			-			69,666			-
Exchange Rate Differences on Gold and Foreign Currency			(53,092	)		593,302			1,503,453			1,534,396
Other Operating Income	9		1,898,588			1,233,102			5,335,795			3,451,034
Underwriting Income	9		626,353			524,631			1,879,264			1,649,910
Loan Loss Provisions			(2,827,313	)		(996,524	)		(6,839,254	)		(3,316,891	)
Net Operating Income			17,382,434			11,274,041			44,492,843			30,769,885
Employee Benefits	9		(3,390,020	)		(2,633,464	)		(9,711,100	)		(7,686,507	)
Administrative Expenses	9		(3,782,984	)		(2,401,040	)		(10,112,250	)		(7,025,218	)
Depreciation and Impairment of Assets	9		(296,477	)		(274,458	)		(832,825	)		(777,254	)
Other Operating Expenses	9		(3,609,833	)		(2,120,876	)		(8,990,815	)		(5,696,013	)
Operating Income			6,303,120			3,844,203			14,845,853			9,584,893
Income for Associates and Joint Ventures			-			40,914			-			181,440
Income before Taxes from Continuing Activities			6,303,120			3,885,117			14,845,853			9,766,333
Income Tax from Continuing Activities			(1,983,533	)		(1,579,710	)		(4,532,101	)		(3,344,700	)
Net Income from Continuing Activities			4,319,587			2,305,407			10,313,752			6,421,633
Income (Loss) from Discontinued Operations	7		(2	)		-			74,776			-
Income Tax from Discontinued Activities	7		-			-			(22,882	)		(185,362	)
Net Income for the Period			4,319,585			2,305,407			10,365,646			6,236,271
Net Income for the Period Attributable to the Controlling Company’s Shareholders			4,212,406			2,124,177			9,999,213			5,779,580
Net Income for the Period Attributable to Non-controlling Interests			107,179			181,230			366,433			456,691

	Notes	09.30.18		09.30.17
Earnings per Share	6
Net Earnings Attributable to the Controlling Company’s Shareholders			9,999,213		5,779,580
Net Earnings Attributable to the Controlling Company’s Shareholders Adjusted for Dilution			9,999,213		5,779,580
Weighted-Average of Ordinary Shares Outstanding for the Period			1,426,765		1,300,265
Weighted-Average of Ordinary Shares Outstanding for the Period Adjusted for Dilution			1,426,765		1,300,265
Basic Earnings per Share			7.01		4.44
Diluted Earnings per Share			7.01		4.44

The accompanying Notes and Schedules are an integral part of these consolidated condensed interim financial statements.

4

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM STATEMENT OF OTHER COMPREHENSIVE INCOME

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	Notes	Three-month Period Ended 09.30.18			Three-month Period Ended 09.30.17			Nine-month Period Ended 09.30.18			Nine-month Period Ended 09.30.17
Net Income for the Period			4,319,585			2,305,407			10,365,646			6,236,271
Items of Other Comprehensive Income that will be Reclassified to Profit or Loss for the Period
Income or Loss from Financial Instruments at Fair Value with Changes in OCI (Other Comprehensive Income) (Item 4.1.2a of IFRS 9)
Loss for the Period from Financial Instruments at Fair Value with Changes in OCI(*)			(80,936	)		(94,150	)		(78,451	)		(276,843	)
Total Other Comprehensive Income that will be Reclassified to Profit or Loss for the Period			(80,936	)		(94,150	)		(78,451	)		(276,843	)
Total Other Comprehensive Income (Loss)			(80,936	)		(94,150	)		(78,451	)		(276,843	)
Total Comprehensive Income			4,238,649			2,211,257			10,287,195			5,959,428
Total Comprehensive Income Attributable to the Controlling Company’s Shareholders			4,131,470			2,030,027			9,920,762			5,502,737
Total Comprehensive Income Attributable to Non-controlling Interests			107,179			181,230			366,433			456,691

(*) Net of Income Tax.

The accompanying Notes and Schedules are an integral part of these consolidated condensed interim financial statements.

5

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Movements	Note	Capital Stock		Non- capitalized Contributions		Adjustments to Shareholders’ Equity		Other Comprehensive Income					Profit Reserves					Retained Income			Total Shareholders’ Equity Attributable to Controlling Interests			Total Shareholders’ Equity Attributable to Non- controlling Interests			Total Shareholders’ Equity
		Outstanding		Additional Paid-in Capital				Accumulated Income (Loss) from Financial Instruments at Fair Value with Changes in OCI			Others		Legal Reserve		Others
Balances as of 12.31.17			1,426,765		10,951,132		278,131		-			-		315,679		17,999,029			8,329,469			39,300,205			-			39,300,205
Adjustments to IFRS-based Accounting Framework	3		-		-		-		17,279			-		-		(924,140	)		2,819,823			1,912,962			1,935,196			3,848,158
Balances as of 12.31.17			1,426,765		10,951,132		278,131		17,279			-		315,679		17,074,889			11,149,292			41,213,167			1,935,196			43,148,363
Acquisition of Interests from Minority Shareholders	3		-		-		-		-			-		-		504,833			-			504,833			(504,833	)		-
Distribution of Dividends from Tarjetas Regionales S.A.			-		-		-		-			-		-		-			-			-			(71,910	)		(71,910	)
Distribution of Profits (*)
-Cash Dividends			-		-		-		-			-		-		-			(1,200,000	)		(1,200,000	)		-			(1,200,000	)
-Other Reserves			-		-		-		-			-		25,300		7,104,169			(7,129,469	)		-			-			-
Total Comprehensive Income (Loss) for the Period			-		-		-		(78,451	)		-		-		-			9,999,213			9,920,762			366,433			10,287,195
Net Income for the Period			-		-		-		-			-		-		-			9,999,213			9,999,213			366,433			10,365,646
Other Comprehensive Income (Loss) for the Period			-		-		-		(78,451	)		-		-		-			-			(78,451	)		-			(78,451	)
Balances as of 09.30.18			1,426,765		10,951,132		278,131		(61,172	)		-		340,979		24,683,891			12,819,036			50,438,762			1,724,886			52,163,648

(*) Approved by Shareholders’ Meeting held on April 24, 2018.

6

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (Continued)

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Movements	Note	Capital Stock		Non-capitalized Contributions		Adjustments to Shareholders’ Equity		Other Comprehensive Income					Profit Reserves					Retained Income			Total Shareholders’ Equity Attributable to Controlling Interests			Total Shareholders’ Equity Attributable to Non- Controlling Interests			Total Shareholders’ Equity
		Outstanding		Additional Paid-in Capital				Accumulated Income (Loss) from Financial Instruments at Fair Value with Changes in OCI			Others		Legal Reserve		Others
Balances as of 01.01.17			1,300,265		219,596		278,131		-			-		315,679		12,221,152			6,017,877			20,352,700			1,451,883			21,804,583
Adjustments to IFRS-based Accounting Framework	3		-		-		-		284,182			-		-		-			2,526,325			2,810,507			-			2,810,507
Adjusted Balances as of 01.01.17			1,300,265		219,596		278,131		284,182			-		315,679		12,221,152			8,544,202			23,163,207			1,451,883			24,615,090
Disposal of Equity Interest in Tarjeta del Mar S.A.			-		-		-		-			-		-		-			-			-			(49,861	)		(49,861	)
Purchase of Minority Interests	3		-		-		-		-			-		-		(924,140	)		-			(924,140	)		(3,087	)		(927,227	)
Distribution of Dividends from Tarjetas Regionales S.A.			-		-		-		-			-		-		-			-			-			(89,516	)		(89,516	)
Distribution of Profits (*)			-		-		-		-			-		-		5,777,877			(6,017,877	)		(240,000	)		-			(240,000	)
-Cash Dividends			-		-		-		-			-		-		-			(240,000	)		(240,000	)		-			(240,000	)
-Other Reserves			-		-		-		-			-		-		5,777,877			(5,777,877	)		-			-			-
Capital Increase (**)	6		110,000		9,318,595		-		-			-		-		-			-			9,428,595			-			9,428,595
Total Comprehensive Income (Loss) for the Period			-		-		-		(276,843	)		-		-		-			5,779,580			5,502,737			456,691			5,959,428
Net Income for the Period			-		-		-		-			-		-		-			5,779,580			5,779,580			456,691			6,236,271
Other Comprehensive Income (Loss) for the Period			-		-		-		(276,843	)		-		-		-			-			(276,843	)		-			(276,843	)
Balances as of 09.30.17			1,410,265		9,538,191		278,131		7,339			-		315,679		17,074,889			8,305,905			36,930,399			1,766,110			38,696,509

*Approved by Shareholders’ Meeting held on April 25, 2017.

** Approved by Shareholders’ Meeting held on August 15, 2017. See Note 6.1. to these financial statements.

7

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS AND CASH EQUIVALENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Notes	09.30.18		09.30.17
OPERATING ACTIVITIES CASH FLOW
Net Income for the Period before Income Tax			14,845,853		9,767,333
Adjustment to Obtain the Operating Activities Flows:
Interest Income			(42,924,848)		(24,846,941)
Interest Expense			22,267,745		11,087,722
Net Loss from Measurement of Fair Value Financial Instruments with Changes to Income			(8,813,999)		(3,444,611)
Loan Loss Provisions			6,839,254		3,316,891
Depreciation and Impairment of Assets			832,825		777,254
Other Allowances			1,754,633		664,633
Exchange Rate Differences			2,730,343		(1,385,352)
Income (Loss) for Associates and Joint Ventures			-		(181,440)
Loss from Derecognition of Assets Measured at Amortized Cost			(101,679)		-
Other Operations			(380,832)		(202,333)
Net Increases/(Decreases) from Operating Assets:
Fair Value Debt Securities with Changes to Income			16,218,412		1,360,892
Derivative Instruments			2,700,130		(130,171)
Repo Transactions			(36,314)		484,396
Other Financial Assets			1,979,189		(1,794,819)
Loans and Other Financing Activities
- Non-financial Public Sector			(243)		1,556
- Other Financial Institutions			(3,480,105)		(1,671,197)
- Non-financial Private Sector and Residents Abroad			(266,663)		(5,712,406)
Other Debt Securities			(10,742,538)		(414,185)
Financial Assets Pledged as Collateral			(2,585,071)		(29,473)
Investments in Equity Instruments			73,786		144,143
Other Non-financial Assets			(75,969)		(765,788)
Net Increases/(Decreases) from Operating Liabilities:
Deposits
- Non-financial Public Sector			3,670,914		186,713
- Financial Sector			(1,469,236)		75,623
- Non-financial Private Sector and Residents Abroad			15,218,978		(563,883)
Fair Value Liabilities with Changes to Income			(202,417)		-
Derivative Instruments			14,283		59,530
Repo Transactions			(2,994,956)		(775,954)
Other Financial Liabilities			(1,002,226)		(3,303,660)
Provisions			18,910		129,814
Other Non-financial Liabilities			939,039		(539,990)
Income Tax Collections/Payments			(4,753,149)		(1,777,975)
TOTAL OPERATING ACTIVITIES (A)			10,274,049		(19,484,678)
INVESTMENT ACTIVITIES CASH FLOWS
Payments:
Purchase of PP&E, Intangible Assets and Other Assets			(2,591,889)		(1,603,343)
Purchase of Unconsolidated Interests			(924,140)		(907)
Dividends			996,343		-
Other Payments Related to Investing Activities			(2,262)		27,733
Collections:
Sale of PP&E, Intangible Assets and Other Assets			55,065		78,239
Other Collections Related to Investing Activities			-		441,837
Discontinued Operations in Associates and Joint Ventures			455,728		4,121
TOTAL INVESTMENT ACTIVITIES (B)			(2,011,155)		(1,052,320)

8

GRUPO FINANCIERO GALICIA S.A.

CONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS AND CASH EQUIVALENTS (Continued)

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Notes	09.30.18		09.30.17
FINANCING ACTIVITIES CASH FLOWS
Payments:
Unsubordinated Notes			1,568,102		(9,671,808)
Argentine Central Bank			-		(4,310)
Subordinated Notes			(481,568)		(342,049)
Loans from Local Financial Institutions			(1,470,997)		(1,645,219)
Banks and International Entities			(2,714,473)		(172,850)
Dividends	6		(1,200,000)		(329,504)
Collections:
Unsubordinated Notes			9,128,253		9,163,942
Argentine Central Bank			5,029		11,895
Loans from Local Financial Institutions			1,044,000		596,911
Banks and International Entities			7,375,328		1,283,310
Equity Instruments Issued			-		9,428,595
TOTAL FINANCING ACTIVITIES (C)			13,253,674		8,318,913
EFFECT OF CHANGES IN EXCHANGE RATE (D)			41,871,798		2,453,412
CASH AND CASH EQUIVALENTS NET REDUCTIONS (A+B+C+D)			63,388,366		(9,764,673)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR	6		89,368,349		77,950,673
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	6		152,756,715		68,186,000

9

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

NOTE 1. ACCOUNTING STANDARDS AND BASIS FOR PREPARATION

Grupo Financiero Galicia S.A. (the “Company”, and collectively with its subsidiaries, the “Group”) was constituted on September 14, 1999, as a financial service holding company organized under the laws of Argentina. The Company’s main asset is its interest in Banco de Galicia y Buenos Aires S.A.U. (the “Bank”). The Bank is a private-sector bank that offers a full spectrum of financial services both to individual and corporate customers. In addition, the Company has a controlling interest in Tarjetas Regionales S.A., which maintains investments related to the issuance of credit cards and supplementary services; Sudamericana Holding S.A., a company engaged in the insurance business; Galicia Administradora de Fondos S.A., a mutual fund manager, and Galicia Warrants S.A., a company engaged in the issuance of warrants.

These consolidated condensed interim financial statements were approved and authorized for publication through Minutes of Board of Directors’ Meeting No. 574 dated November 27, 2018.

1.1.         ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)

In light of the fact that the Group is subject to the Periodical Reporting Requirements contained in the provisions of Article 2 – Section I – Chapter I of Title IV of the Argentine National Securities Commission (“C.N.V.”) regulations, the Group is required to present its consolidated financial statements in accordance with the valuation and disclosure criteria set forth by the Argentine Central Bank. Pursuant to the foregoing sentence, we hereby report that:

- The Company’s corporate purpose is exclusively related to financial and investment activities;

- the equity investment in the Bank and Tarjetas Regionales S.A., the latter being subject to the consolidated supervision requirements prescribed by the Argentine Central Bank (Communiqué “A” 2989, as supplemented), accounts for 94.64% of the Company’s assets and constitutes the Company’s main asset;

- 91.15% of the Company’s income is derived from its share of profit (loss) in the entities referred to in the preceding paragraph; and

- The Company has a 100% equity interest in the Bank and an 83% equity interest in Tarjetas Regionales S.A., thus having control over both entities.

The Argentine Central Bank, through Communiqué “A” 5541, as amended, set forth a convergence plan towards the International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB) and the interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC), which was addressed to entities under the Argentine Central Bank’s supervision, effective for the fiscal year that commenced January 1, 2018, except for item 5.5 (Impairment) of IFRS 9 “Financial Instruments”, which has been temporarily waived until January 1, 2020, at which time entities will be required to apply the provisions on Impairment of Financial Assets and IAS 29 “Financial Reporting in Hyperinflationary Economies” (see Note 1.2.).

Entities are also required to prepare their opening financial statements since January 1, 2017, which will serve as comparative basis to the financial statements commencing on January 1, 2018, under these standards with the interim financial statements as of March 31, 2018 being the first interim financial statements being prepared under these standards.

The Group’s consolidated condensed interim financial statements for the nine-month period ended September 30, 2018 have been prepared in accordance with IAS 34 “Interim Financial Reporting” and IFRS 1 “First-time Adoption of International Financial Reporting Standards.” The consolidated condensed interim financial statements have been prepared in accordance with the criteria the Group expects to adopt in preparing its annual consolidated financial statements as of December 31, 2018.

Comparative figures and figures as of the transition date (January 1, 2017) have been modified to reflect the adjustments to the aforementioned accounting framework.

Note 3 presents a reconciliation of the figures disclosed in the balance sheet, statement of comprehensive income, statement of other comprehensive income, and statement of cash flows and cash equivalents comprising the consolidated condensed interim financial statements issued under the previous accounting framework to the figures disclosed in these consolidated condensed interim financial statements according to the IFRS-based accounting framework, as well as the effects of adjustments to cash flows as of the transition date (January 1, 2017), as of the adoption date (December 31, 2017) and as of the end of the comparative period (September 30, 2017).

10

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

These consolidated condensed interim financial statements should be read together with the Group’s annual financial statements as of December 31, 2017 prepared in accordance with the accounting framework described above. Furthermore, the Note entitled “Additional Information as of December 31, 2017 for the Consolidated Condensed Interim Financial Statements” included in these consolidated condensed interim financial statements contains certain information under the IFRS-based accounting framework which is required to understand these consolidated condensed interim financial statements.

It has been concluded that these consolidated condensed interim financial statements fairly present the Group’s financial position, financial performance and cash flows.

1.2.        BASIS FOR PREPARATION

These consolidated condensed interim financial statements have been prepared in accordance with the IFRS-based accounting framework set forth by the Argentine Central Bank, as described in Note 1.1.

In preparing these consolidated condensed interim financial statements, the Group is required to make estimates and assessments to determine the reported amounts of assets and liabilities, and contingent assets and liabilities disclosed as of the date of these consolidated condensed interim financial statements, as well as the reported amounts of income and expenses. Estimates are made in order to calculate, at a given time, the recoverable value of assets, loan loss provisions and provisions for other contingencies, depreciation expenses and income tax expenses, among other items. Future actual results may differ from estimates and assessments made as of the date these consolidated condensed interim financial statements were prepared.

The areas involving a higher degree of judgment or complexity or the areas in which the assumptions and estimates are material for these consolidated condensed interim financial statements are described in Note 2.

(a)        Going Concern

As of the date of these consolidated condensed interim financial statements, there are no uncertainties as to developments or circumstances that may call into question the likelihood that the Group will continue operating normally as a going concern.

(b)        Measurement Unit

The Group’s consolidated condensed interim financial statements reflect the effects of changes in the purchasing power of currency until February 28, 2003, the date on which the adjustment for inflation was discontinued, as required by Decree No. 664/03 of the Argentine National Executive Branch, Section 268 of General Resolution No. 7/2005 of the Corporation Control Authority, Communiqué “A” 3921 of the Argentine Central Bank, and General Resolution No. 441/03 of the C.N.V. In addition, Resolution M.D. No. 41/03 of the Professional Council in Economic Sciences of the Autonomous City of Buenos Aires (C.P.C.E.C.A.B.A.) established the discontinuation of the recognition of changes in the purchasing power of currency effective October 1, 2003.

IAS 29 “Financial Reporting in Hyperinflationary Economies” requires that the financial statements of an entity whose functional currency is that of a hyperinflationary economy be stated in terms of the current measurement unit as of the reporting period-end, irrespective of whether they are based on the historical cost or the current cost method. Accordingly, inflation occurring since the acquisition date or since the revaluation date, as the case may be, should be accounted for in non-monetary items. These requirements are also applicable to the comparative information reported in financial statements. According to IAS 29, monetary assets and liabilities are not required to be restated, for they are stated in the current unit of measurement as of the end of the reporting period. Assets and liabilities subject to adjustments based on specific agreements will be adjusted on the basis of such agreements. Non-monetary items measured at their current values at the end of the reporting period, such as net realizable value or otherwise, will not be restated. Other non-monetary assets and liabilities will be restated by applying a general price index. Income (loss) from the net monetary position will be charged to net income for the reporting period under a separate item.

11

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Based on the foregoing, the Group’s shareholders’ equity and results of operations will substantially differ from currently reported balances if such balances were restated into constant currency as of the date of these financial statements.

In order to determine whether a given economy qualifies as hyperinflationary pursuant to the terms of IAS 29, the standard sets forth certain factors that should be considered, including a three-year cumulative inflation rate reaching or exceeding 100%.

The downward inflation trend that was observed in the previous year seems to have reversed, experiencing a substantial increase in inflation during 2018. Additionally, the last three years’ cumulative inflation rate is expected to surpass 100%. All other indicators are consistent with the conclusion that Argentina should be regarded as a hyperinflationary economy for accounting purposes, pursuant to IAS 29.

In this regard, the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.) issued a release noting that, effective for fiscal years ending on or after July 1, 2018, entities reporting under IFRS will be required to apply the inflation adjustment since the conditions for such application have been satisfied.

However, it should be noted that, as of the date of these financial statements, the standards promulgated by the Group’s controlling authorities are still in force, according to which entities are not allowed to file information that has been restated into constant currency. Accordingly, as September 30, 2018, the Company has not applied the criteria for the restatement of financial information set forth in IAS 29.

The Argentine Senate enacted Bill CD-33/18 on November 15, 2018, which establishes legislative changes related to the abrogation of Decree 664/2003. This law will come into force as of the publication date in the Official Gazette and will be applicable to financial statements filed by entities as of the date determined by the Argentine National Executive Branch, through its controlling authorities and the Argentine Central Bank.

Therefore, in reading and analyzing these financial statements, users should consider the last three years’ cumulative inflation rates and certain macroeconomic variables affecting the Group’s business, including labor costs and prices for supplies.

(c)        Changes in Accounting Criteria/New Accounting Standards

As provided for in the Argentine Central Bank’s Organic Charter and the Financial Institutions Law, as new IFRS are approved or amended, or as the IFRS currently in force are repealed, and once these changes are adopted by way of Adoption Circulars handed down by the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.), the Argentine Central Bank will decide whether to approve such changes for financial institutions. In general terms, the early adoption of any given IFRS will not be admitted, unless specifically admitted at the time of adoption.

Below is a summary of the new standards, changes and interpretations which have been published but have not yet come into force for the fiscal year commencing on January 1, 2018, and which have not been adopted earlier.

IFRS 16 “Leases”: In January 2016, the IASB issued IFRS 16 “Leases” which sets out a new accounting model for leases. Under IFRS 16, a contract is or contains a lease if the contract confers the lessee a right to control the use of an identified asset for a period of time, for consideration. IFRS 16 requires that the lessee recognize the liability arising from the lease reflecting the lease’s future payments and a right of use of the assets for substantially all leases, other than certain short-term leases and leases of low-value assets. Lessor accounting is maintained as provided for in IAS 17. However, the new accounting model for lessee is expected to have an impact on negotiations between lessors and lessees. Entities are required to apply IFRS 16 for fiscal years commencing on or after January 1, 2019.

The Argentine Central Bank issued Communication “A” 6560 adopting the new IFRS and IFRS amendments, and setting forth the changes introduced to the chart of accounts and reporting requirements as a consequence of such IFRS coming into force.

The Group is assessing the impact the adoption of such standard will have on its financial statements.

IFRS 17 “Insurance Contracts”: On May 18, 2017, the IASB issued IFRS 17 “Insurance Contracts,” establishing a comprehensive accounting framework based on measurement and disclosure principles for insurance contracts. The new standard supersedes IFRS 4 “Insurance Contracts,” and requires that insurance contracts be measured using current fulfillment cash flows and that revenues be recognized as the insurance service is delivered during the term of the coverage. Entities are required to apply IFRS 17 for fiscal years commencing on or after November 1, 2021. The Group is assessing the potential impact this standard will have on its financial statements.

12

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

IFRIC 23 “Uncertainty over Income Tax Treatment”: This interpretation clarifies how the recognition and measurement requirements of IAS 12 “Income Tax” should be applied when there is uncertainty over the income tax treatment. IFRIC 23 was published in June 2017 and entities will be required to apply it for fiscal years commencing on or after January 1, 2019.

To date, there are no other IFRS or IFRIC interpretations which have not yet come into force and which are expected to have a material impact on the Group.

1.3.        CONSOLIDATION

A subsidiary is an entity, including structured entities, over which the Group has control because (i) it has the power to direct the investee’s relevant activities substantially affecting its returns, (ii) it has exposure to, or rights in, variable returns by reason of its involvement with the investee, and (iii) it has the ability to use its power over the investee to affect the amount of the investor’s returns. The existence and effect of substantive rights, including potential voting rights, is taken into account when assessing whether the Group has influence on another entity. In order for a right to be substantive, it must be exercisable by its holder when decisions about the direction of the entity’s relevant activities need to be made. The Group may have control over an entity, even if it is entitled to less than a majority of voting rights.

In addition, other investors’ protective rights, such as those related to substantive changes to the investee’s activities or only applicable under exceptional circumstances, do not prevent the Group from having power over an investee. Subsidiaries are consolidated as of the date control is transferred to the Group, and are removed from consolidation as of the date on which control ceases.

The following table shows the subsidiaries consolidated into the Group’s consolidated condensed interim financial statements, at their different levels:

Company	Country		Local and	Closing Date		Percentage Interest (%)
						09.30.18				12.31.17				01.01.17
			Functional Currency			Direct		Direct and Indirect		Direct		Direct and Indirect		Direct		Direct and Indirect
Banco de Galicia y Buenos Aires S.A.U.		Argentina	ARP		09.30.18		100.0		100.0		100.0		100.0		100.0		100.0
Cobranzas Regionales S.A.		Argentina	ARP		09.30.18		-		83.0		-		77.0		-		77.0
Galicia Administradora de Fondos S.A.		Argentina	ARP		09.30.18		95.0		100.0		95.0		100.0		95.0		100.0
Galicia Broker Asesores de Seguros S.A.		Argentina	ARP		09.30.18		-		99.9		-		99.9		-		99.9
Galicia Retiro Compañía de Seguros S.A.		Argentina	ARP		09.30.18		-		99.9		-		99.9		-		99.9
Galicia Seguros S.A.		Argentina	ARP		09.30.18		-		99.9		-		99.9		-		99.9
Galicia Valores S.A.		Argentina	ARP		09.30.18		1.0		100.0		1.0		100.0		-		100.0
Galicia Warrants S.A.		Argentina	ARP		09.30.18		87.5		100.0		87.5		100.0		87.5		100.0
Financial Trust Galtrust I		Argentina	ARP		09.30.18		-		-		-		100.0		-		100.0
Financial Trust Saturno Créditos		Argentina	ARP		09.30.18		-		100.0		-		100.0		-		100.0
Net Investment S.A. (in Liquidation)(*)		Argentina	ARP		09.30.18		-		-		87.5		100.0		87.5		100.0
Ondara S.A.		Argentina	ARP		09.30.18		-		83.9		-		78.2		-		78.2
Sudamericana Holding S.A.		Argentina	ARP		09.30.18		87.5		100.0		87.5		100.0		87.5		100.0
Tarjeta Naranja S.A.		Argentina	ARP		09.30.18		83.0		83.0		-		77.0		-		77.0
Tarjetas del Mar S.A.		Argentina	ARP		09.30.18		-		-		-		-		-		60.0
Tarjetas Regionales S.A.		Argentina	ARP		09.30.18		83.0		83.0		-		77.0		-		77.0

(*) The financial distribution was paid out on January 9, 2018.

As result of the application of IFRS 10 “Consolidation,” the Group has started to recognize Financial Trusts Saturno Créditos and Financial Trust Galtrust I in its consolidated financial statements, and has ceased to recognize Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A., as these two companies have been classified as held for sale.

For purposes of the consolidation, the Group relied on the Bank’s and Tarjetas Regionales S.A.’s financial statements for the nine-month period ended September 30, 2018, which reflect the same period of time as the Group’s financial statements. The financial statements of the other subsidiaries have been adjusted in order for them to reflect similar criteria as those applied by the Group in preparing its consolidated condensed interim financial statements.

13

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Accounts receivable and payable and gains (losses) from inter-company transactions were eliminated from the consolidated condensed interim financial statements.

A non-controlling interest is a subsidiary’s share of net income (loss) and shareholders’ equity attributable to interests which are not owned by the Company, either directly or indirectly. Non-controlling interests are disclosed as a separate item of the Group’s shareholders’ equity.

According to the provisions set forth in IFRS 3 “Business Combinations,” the acquisition of subsidiaries is accounted for by applying the acquisition method. The identifiable assets and liabilities acquired and the contingent liabilities assumed in a business combination are measured at fair value on the acquisition date.

Goodwill is measured as the difference between the net resulting amount, as of the acquisition date, of the identifiable assets acquired, the liabilities assumed, the value of the consideration transferred, the amount of the non-controlling interest in the investee, and the fair value of an interest in the investee before the acquisition date.

The consideration transferred in a business combination is measured at the fair value of the assets transferred by the acquirer, the liabilities owing by such acquirer to the investee’s former owners, and the equity instruments issued by the acquirer. Transaction costs are recognized as expenses in the periods in which costs were incurred and services were received, other than transaction costs incurred in issuing equity instruments which are deducted from equity and the transaction costs incurred in issuing debt instruments, which are deducted from their carrying amount.

1.4.        TRANSACTIONS WITH THE NON-CONTROLLING INTEREST

The Group considers transactions with the non-controlling interest as if they were transactions with the Group’s shareholders. When acquiring a non-controlling interest, the difference between the price paid and the respective interest in the carrying amount of the subsidiary’s net assets acquired is recognized in shareholders’ equity. The gains and losses on the disposal of equity interests are also recognized in shareholders’ equity, to the extent control is maintained.

1.5.        ASSOCIATES

Associates are entities over which the Group has significant influence (either directly or indirectly), but not control, usually associated to a 20%-50% interest in voting rights. Investments in associates are accounted for using the equity method and are initially recognized at cost. The carrying amount of associates includes the goodwill identified in the acquisition, net of accumulated impairment losses, if any. Dividends received from associates reduce the carrying amount of the investment in associates. Other changes subsequent to the acquisition in the Group’s interest in an associate’s net assets are recognized as follows: (i) the Group’s interest in the profits or losses of the associates is accounted for in the income statement under Income (Loss) for Associates and Joint Ventures, and (ii) the Group’s interest in other comprehensive income is recognized in the statement of other comprehensive income and is disclosed separately. However, when the Group’s share of losses of an associate is equal to or higher than its interest in such associate, the Group ceases to recognize its share of additional losses, unless it has incurred liabilities or has made payments on behalf of the associate.

Unrealized gains in transactions between the Group and its associates are eliminated on a proportional basis to the Group’s interest in the associates; unrealized losses are also eliminated, unless the transaction evidences that the transferred asset has been impaired.

1.6.        SEGMENT REPORTING

An operating segment is a component of an entity (a) that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity), (b) whose operating results are reviewed regularly to make decisions about resources to be allocated to the segment and assess its performance, and (c) for which confidential financial information is available.

Operating segments are reported consistently with the internal reports submitted to the Board of Directors, which is responsible for making the Group’s strategic decisions, allocating resources and assessing the performance of the operating segments.

14

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

1.7.        FOREIGN CURRENCY TRANSLATION

(a)        Functional Currency and Reporting Currency

The figures disclosed in the consolidated condensed interim financial statements for each of the Group’s entities are stated in their functional currency, that is, the currency of the main economic environment in which they operate. These consolidated condensed interim financial statements are stated in Argentine Pesos, which is the Group’s functional and reporting currency.

(b)        Transactions and Balances

Transactions in foreign currency are translated to functional currency at the exchange rates prevailing on the transaction or valuation dates when items are measured at closing. Gains and losses in foreign currency on the settlement of these transactions and on the translation of monetary assets and liabilities to foreign currency at the exchange rates prevailing at closing are recognized in the income statement under “Exchange Rate Differences on Gold and Foreign Currency,” except when deferred in equity as in the case of qualifying cash flow hedges, where applicable.

Assets and liabilities in foreign currency are measured at the reference exchange rate of the U.S. Dollar set by the Argentine Central Bank prevailing at the close of operations on the last working day of each month.

As of September 30, 2018, December 31, 2017, September 30, 2017 and January 1, 2017, balances in U.S. Dollars were converted applying the reference exchange rate ($40.8967, $18.7742, $17.3183 and $15.8502, respectively) set by the Argentine Central Bank. Assets and liabilities valued in foreign currencies other than the U.S. Dollar were converted into the latter currency using swap rates reported by the Argentine Central Bank.

1.8.        CASH AND BANK DEPOSITS

The item Cash and Bank Deposits includes cash available and unrestricted deposits held in banks, which are short-term liquid instruments and have a maturity of less than three months from the origination date.

The assets disclosed under cash and cash equivalents are accounted for at amortized cost which approximates its fair value.

1.9.        FINANCIAL INSTRUMENTS

Initial Recognition

The Group recognizes a financial asset or liability in its consolidated condensed interim financial statements, as the case may be, when it becomes a party to the financial instrument contract. Purchases and sales are recognized on the trading date on which the Group buys or sells these instruments.

Upon initial recognition, the Group measures financial assets and liabilities at fair value, plus or less, in the case of instruments that are not recognized at fair value with changes in profit or loss, the transaction costs directly attributable to the acquisition, such as fees and commissions.

Where the fair value differs from the acquisition cost at the time of initial recognition, the Group recognizes the difference as follows:

a. When the fair value is consistent with the financial asset or liability market value, or is based on a valuation method relying on market values only, the difference is recognized as profit or loss, as the case may be.

b. In other cases, the difference is deferred, with recognition of the profit or loss over time being determined case by case. The difference is amortized during the life of the instrument until such time as the fair value can be measured on the basis of market values.

Financial Assets

a. Debt Instruments

The Group classifies as debt instruments such instruments that are considered financial liabilities for the issuer, including loans, government and private securities, bonds, and accounts receivable from customers.

Classification

As set out in IFRS 9, the Group classifies financial assets as subsequently measured at amortized cost, at fair value with changes in other comprehensive income or at fair value with changes in profit or loss, on the basis of:

15

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

- the Group’s business model to manage financial assets; and

- the characteristics of contractual cash flows of the financial asset.

Business Model

The business model is the manner in which the Group manages a set of financial assets to achieve a specific business goal. It represents the manner in which the Group maintains instruments for cash generation.

The Group may follow several business models, whose objective is:

- Holding instruments until maturity;

- Holding instruments in portfolio to collect cash flows and, in turn, sell them if deemed convenient; or

- Holding instruments for trading.

The Group’s business model does not depend on the intended purpose of an individual instrument. Accordingly, this condition is not an approach for classification of instruments on an individual basis. Instead, such classification is determined at a higher level of aggregation.

The Group only reclassifies an instrument if and when the business model for managing financial assets has changed. Such reclassification takes place as from the commencement of the period in which the change has occurred. Such changes are not expected to be frequent, with no changes having occurred during the reporting period.

Characteristics of Cash Flows

The Group assesses whether the cash flows from the aggregated instruments do not substantially differ from the cash flows it would receive as interest only; otherwise, such instruments should be measured at fair value with changes in profit or loss.

Based on the aforementioned, Financial Assets are classified into three categories:

(i) Financial assets measured at amortized cost:

Financial assets are measured at amortized cost when:

(a) the financial asset is held within a business model whose objective is to maintain financial assets to collect contractual cash flows; and

(b) the contractual conditions of the financial asset give rise, on certain specified dates, to cash flows which are only principal and interest payments on the outstanding principal amount.

These financial instruments are initially recognized at fair value plus the incremental and directly attributable transaction costs, and are subsequently measured at amortized cost.

The amortized cost of a financial asset is equal to its acquisition cost, net of accumulated amortization plus accrued interest (calculated applying the effective rate method), net of impairment losses, if any.

(ii) Financial assets at fair value with changes in other comprehensive income:

Financial assets are measured at fair value with changes in other comprehensive income when:

(a) the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

(b) the contractual conditions of the financial asset give rise, on certain specified dates, to cash flows which are only principal and interest payments on the outstanding principal amount.

These instruments are initially recognized at fair value plus the incremental and directly attributable transaction costs, and are subsequently measured at fair value with changes in other comprehensive income. The gains and losses arising from the changes in fair value are included in other comprehensive income under a separate component of equity. Losses or impairment reversals, interest income, and exchange gains and losses are charged to income. Upon the sale or disposal of the instrument, the accumulated gains or losses previously recognized in other comprehensive income are reclassified from equity to the income statement.

16

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

(iii) Financial assets at fair value with changes in profit or loss:

Financial assets at fair value with changes in profit or loss include:

- Instruments held for trading;

- Instruments specifically designated at fair value with changes in profit or loss; and

- Instruments whose contractual terms do not represent cash flows but rather principal or interest payments only on outstanding principal amount.

These financial instruments are initially recognized at fair value and the gains or losses derived from them are charged to the income statement as realized.

The Group classifies a financial instrument as held for trading if such instrument is acquired or incurred for the main purpose of selling or repurchasing it in the short term, or if it is part of a portfolio of financial instruments which are managed jointly and for which there is evidence of short-term profits, or if it is a derivative which does not qualify as a hedging instrument. Derivatives and trading securities are classified as held for trading and are measured at fair value.

Furthermore, financial assets may be measured at fair value with changes in profit or loss when, in doing so, the Group eliminates or substantially reduces a measurement or recognition inconsistency.

b.        Equity Instruments

Equity instruments are those considered as such by the issuer; in other words, instruments which do not entail a contractual payment obligation and which evidence a residual interest on the issuer’s assets after deducting all of its liabilities.

Such instruments are measured at fair value with changes in profit or loss, except where management has availed, at the time of their initial recognition, of the irrevocable option to measure them at fair value with changes in other comprehensive income. This method may only be applied when instruments are not held for trading and their respective gains or losses will be accounted for in Other Comprehensive Income, with no reclassification being allowed, even if already realized. Dividends receivable from such instrument will be charged to income only at the time the Group becomes entitled to receive payment.

Financial Liabilities

Classification

The Group classifies its financial liabilities at amortized cost using the effective rate method, except for:

- Financial liabilities measured at fair value with changes in profit or loss, including derivative instruments.

- Liabilities resulting from the transfer of financial assets that do not meet the derecognition requirements.

- Financial guarantee contracts.

- Loan commitments at lower than market rates.

Financial liabilities measured at fair value with changes in profit or loss: The Group may, upon initial recognition, avail of the irrevocable option to designate a liability at fair value with changes in profit or loss, if and only if exercising such option results in a better measurement of financial information because:

- the Group eliminates or substantially reduces measurement or recognition inconsistencies which would otherwise be revealed in valuation;

- if financial assets and liabilities are managed and performance is assessed on a fair value basis, according to a documented investment or risk management strategy; or

- if a host contract contains one or more embedded derivatives and the entity has opted for designating the entire contract at fair value with changes in profit or loss.

17

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Financial guarantee contracts: Financial guarantee contracts require that the issuer make specified payments to reimburse the holder for the loss it may incur if a specific debtor fails to make payment when due under the original or modified terms of a debt instrument.

Financial guarantee contracts and loan commitments at lower than market rates are initially measured at fair value and then remeasured at the higher value resulting from a comparison between the commission pending accrual at year-end and the applicable allowance for impairment.

Derecognition of Financial Instruments

Financial Assets

A financial asset or, where applicable, a portion of a financial asset or a portion of a group of similar financial assets, is derecognized when: (i) the rights to receive cash flows from the asset have been extinguished; or (ii) the Group has transferred its rights to receive cash flows from the asset or has assumed the obligation to pay right away all cash flows received to a third party under a pass-through agreement; and substantially all risks and rewards inherent to the asset have been transferred or, if substantially all risks and rewards inherent to the asset have not been transferred or retained, when control over such asset has been transferred.

When the contractual rights to receive the cash flows generated by the asset have been transferred or a pass-through agreement has been entered into, the entity will assess whether or not, and to which extent, it has retained the risks and rewards inherent to ownership of an asset. If an entity has neither transferred nor retained substantially all risks and rewards inherent to ownership of an asset, nor has it transferred control over such asset, then it will continue recognizing such asset in its financial statements to the extent of its continuing involvement with the same.

In this case, the entity will also recognize the related liability. The transferred asset and the related liability are measured in such a manner as to reflect the rights and obligations the Group has retained.

When continuing involvement takes the form of collateral over the transferred asset, it is measured at the lower of (i) the original carrying amount, and (ii) the maximum amount of the consideration received which the entity could be required to repay.

Financial Liabilities:

A financial liability is derecognized when the payment obligation ends, is canceled or expires. When an existing financial liability is exchanged for another with the same borrower under substantially different terms, or the prevailing terms are substantially modified, such exchange or modification will be treated as a derecognition of the original liability, and a new liability will be recognized. The difference between the carrying amount of the initial financial liability and the consideration paid is recognized in the consolidated income statement.

1.10.        DERIVATIVE INSTRUMENTS

Derivative instruments, including foreign exchange contracts, interest rate futures, forwards, interest rate and currency swaps, and currency and interest rate options, are carried at fair value.

All derivative instruments are accounted for as assets when fair value is positive and as liabilities when fair value is negative, relative to the agreed-upon price. Changes in the fair value of derivative instruments are charged to income for the period.

The Group has not applied hedge accounting in these consolidated condensed interim financial statements.

1.11.        REPO TRANSACTIONS

Reverse Repo Transactions

According to the derecognition principles set out in IFRS 9, these transactions are treated as secured loans for the risk has not been transferred to the counterparty.

Loans granted in the form of reverse repo agreements are accounted for under “Repo Transactions”, classified by counterparty (financial debtors, Argentine Central Bank and non-financial debtors), and also classified by the type of assets received as collateral.

18

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

At the end of each month, accrued interest income is charged against “Repo Transactions” with its corresponding offsetting entry in “Interest Income.”

The underlying assets received in respect of the reserve repo transactions are accounted for in Off-balance Sheet Items. These accounts reflect, as of each month-end, the notional amounts of current transactions measured at fair value and converted to their equivalent amounts in Pesos, where applicable. The assets received and sold by the entity are not deducted, but rather derecognized at the end of the repo transaction, and an in-kind liability is recorded to reflect the obligation of delivering the security disposed of.

Repo Transactions

Loans granted in the form of repo agreements are accounted for under “Repo Transactions”, classified by counterparty (financial creditors, Argentine Central Bank and non-financial creditors) and also by the type of asset pledged as collateral.

In these transactions, when the recipient of the underlying asset becomes entitled to sell it or pledge it as collateral, it is reclassified to “Financial Assets Pledged as Collateral.” At the end of each month, these assets are measured according to the category they were classified into before the repo transaction, and results are charged against the applicable accounts, depending on the type of asset.

At the end of each month, accrued interest expense is charged against “Repo Transactions” with its corresponding offsetting entry in “Interest Expense.”

1.12.        ALLOWANCES FOR LOAN LOSSES

As concerns allowances for loan losses, the “Minimum Allowances for Loan Losses” set out in Section 8 of the Liquidity and Solvency Circular (LISOL) still remain in force and are detailed below:

Entities are required to apply the following guidelines on minimum allowances for loan losses in respect of total debts owing by their customers:

Commercial Loan Portfolio	Consumer or Consumer Comparable Loan Portfolio	With Preferred Guarantees			Without Preferred Guarantees
Normal	Normal		1	%		1	%
Under Observation	Low Risk		3	%		5	%
Under Negotiation or under Refinancing Agreements	N/A		6	%		12	%
With Problems	Medium Risk		12	%		25	%
High Risk of Insolvency	High Risk		25	%		50	%

Commercial Loan Portfolio	Consumer or Consumer Comparable Loan Portfolio	With Preferred Guarantees			Without Preferred Guarantees
Uncollectible	Uncollectible		50	%		100	%
Uncollectible due to Technical Reasons	Uncollectible due to Technical Reasons		100	%		100	%

Loans backed with preferred guarantees “A” require a provision of 1% independently of the customer category.

The aforementioned categories of debtors are broken down as follows:

- Commercial Loan Portfolio: It includes all loans other than:

• Consumer and mortgage loans.

• Commercial loans for up to the equivalent of 40% of the reference value set out in the standard.

- Consumer Loan Portfolio: It includes all loans excluded from the preceding item.

On the other hand, the status assigned to each debtor within the commercial loan portfolio is determined, in the first instance, on the basis of the debtor’s repayment capacity and, in the second instance, on the basis of the foreclosure of its assets, while the status assigned to debtors within the consumer and consumer comparable loan portfolio is assigned on the basis of the degree of fulfillment of their respective obligations.

19

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Among other specific provisions, the Bank has opted for discontinuing interest accrual for customers classified in an irregular status.

1.13.        LEASES

1.13.1.        Operating Leases

Leases where the lessor retains a substantial portion of the risks and rewards of ownership are classified as operating leases. Payments made under operating leases (net of lease incentives) are recognized in profit or loss on a straight-line basis over the term of the lease.

1.13.2.        Financial Leases

Financial leases are capitalized, at the commencement of the lease, at the lower of the fair value of the leased asset and the present value of minimum lease payments.

Each lease payment is distributed between liabilities and financial charges. The respective lease liabilities, net of financial charges, are included in other financial liabilities. The interest component of the financial cost is charged to income during the lease term in such a manner as to obtain a constant periodical interest rate on the remaining balance of the liability for each period. Assets acquired under a financial lease are depreciated during the shorter of the asset useful life and the lease term.

1.14.        PROPERTY, PLANT AND EQUIPMENT

The Group has availed of the option set out in IFRS 1 “First-time Adoption of IFRS” and has adopted the fair value as attributed cost for certain items of property, plant and equipment as of the transition date to the IFRS discussed in Note 3.

Assets are measured at acquisition or construction cost, net of accumulated depreciation and/or impairment losses, if any. The cost includes expenses directly attributable to the acquisition or construction of the items.

The items of property, plant and equipment acquired in business combinations were initially measured at their estimated fair value at the time of the acquisition.

Subsequent costs are included in the value of the asset and are recognized as a separate asset, as the case may be, if and only if future economic benefits are expected to flow to the Group and its cost can be measured reliably. When improvements are introduced to the asset, the carrying amount of the asset being replaced is derecognized, and the new asset is depreciated over its remaining useful life.

Repair and maintenance expenses are recognized in the consolidated income statement for the period/year in which they were incurred.

Depreciation is calculated on a straight-line basis, using annual rates sufficient to extinguish the value of the assets at the end of their estimated useful life. If an asset is comprised by significant components with varying useful lives, such components will be recognized and depreciated as separate items.

Property, plant and equipment residual values, useful lives and depreciation methods are reviewed and adjusted, as needed, as of each year-end or when indicators of impairment exist.

The carrying amount of property, plant and equipment is immediately reduced to its recoverable value when the carrying amount exceeds the estimated recoverable value.

Gains and losses from the disposal of items of property, plant and equipment are calculated by comparing the proceeds from the disposal to the carrying amount of the respective asset and are charged to income.

1.15.        INTANGIBLE ASSETS

1.15.1.        Licenses

Licenses acquired individually are initially measured at cost, while licenses acquired through business combinations are measured at their estimated fair value on the acquisition date.

20

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

As of the date of these consolidated condensed interim financial statements, intangible assets with a definite useful life are disclosed net of accumulated amortization and/or impairment losses, if any. These assets are tested for impairment on an annual basis or when indicators of impairment exist.

Licenses acquired by the Group were classified as intangible assets with a definite useful life and are amortized on a straight-line basis over the license term.

Intangible assets with an indefinite useful life are those arising from contracts or other legal rights renewable at no significant cost and for which, on the basis of an analysis of all relevant factors, there is no foreseeable time limit during which the asset is expected to generate net cash flows for the Group. These intangible assets are not amortized, but are rather tested for impairment on an annual basis or when indicators of impairment exist, either individually or at the cash-generating unit level. The determination of the indefinite useful life is reviewed on an annual basis to confirm whether it is still applicable.

1.15.2.        Software

Costs associated with software maintenance are recognized as an expense when incurred. Development, acquisition and deployment costs, unique and identifiable and directly attributable to the design and testing of software controlled by the Group, are recognized as assets.

Costs incurred in software development, acquisition and deployment recognized as intangible assets are amortized on a straight-line basis during the estimated useful life.

1.16.        ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

1.16.1.        Assets Held for Sale

The assets, or group of assets, classified as available for sale pursuant to IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations,” are disclosed separately from the other assets.

An asset may be classified as available for sale (including the loss of control over a subsidiary) if its carrying amount is fundamentally recoverable as a result of a sale transaction, in lieu of the continued use of such asset.

In order for an asset to be included in the preceding classification, it will have to meet the following conditions:

- it must be available for immediate sale in its current condition;

- management must be committed to a plan to sell the asset and must have initiated an active program to locate a buyer and complete the plan;

- the asset must be actively marketed for sale at a reasonable price in relation to its current fair value;

- the sale must be expected to be completed within 12 months from the reclassification date;

- it is unlikely that the plan will be significantly changed or withdrawn.

Assets, or groups of assets, classified as available for sale pursuant to IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations,” are measured at the lower of the carrying amount and fair value less costs to sell at closing.

The asset will not be depreciated for as long as it is classified as held for sale, or as long as it is part of a disposal group of assets classified as held for sale.

1.16.2.        Discontinued Operations

A discontinued operation is a Group’s component that either has been disposed of, or classified as held for sale, and meets any of the following conditions:

- represents either a separate major line of business or a geographical area of operations;

- is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations; or

- is an independent entity exclusively acquired for resale.

Any gain or loss on the remeasurement of an asset (or disposal group) classified as held for sale which does not meet the requirements to be classified as a discontinued operation will be recognized in income from continuing operations.

21

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

1.17.        IMPAIRMENT OF NON-FINANCIAL ASSETS

Assets with an indefinite useful life are not amortized, but are rather tested for impairment on an annual basis. Unlike the preceding assumption, amortizable assets are tested for impairment when events or circumstances occur indicating that their carrying amounts may not be recoverable or, at least, on an annual basis.

Impairment losses are recognized when the carrying amount of an asset exceeds its recoverable value. The recoverable value of an asset is the higher of the net proceeds that would be derived from its disposal or its value in use. For purposes of the impairment test, assets are grouped at the lowest level for which identifiable cash flows are generated (cash-generating units or CGU). The carrying amount of non-financial assets, other than goodwill, which have experienced impairment is reviewed at each reporting date to check for potential impairment reversal.

1.18.        TRUST ASSETS

Assets held by the Group in its capacity as trustee are not reported in the consolidated balance sheet. Commissions and fees earned on trust activities are disclosed in Commission Income.

1.19.        OFFSETTING

Financial assets and liabilities are offset by reporting the net amount in the consolidated balance sheet only to the extent the entity currently has a legally enforceable right of set-off, and intends to settle on a net basis, or realize the asset and settle the liability simultaneously.

1.20. LOANS FROM THE ARGENTINE CENTRAL BANK AND OTHER FINANCIAL INSTITUTIONS

The amounts owing to other financial institutions are recorded at the time the bank disburses the proceeds to the economic group. The non-derivative financial liability is measured at amortized cost. Where the Group buys back its own debt, such debt will be removed from its consolidated condensed interim financial statements and the difference between the residual value of the financial liability and the amount paid will be recognized as financial income or expense, as the case may be.

1.21.        PROVISIONS / CONTINGENCIES

According to the IFRS-based accounting framework adopted by the Argentine Central Bank, a provision will be recognized when:

a. an entity has a present obligation (legal or constructive) as a result of a past event;

b. it is probable that an outflow of resources embodying future economic benefits will be required to settle the obligation; and

c. a reliable estimate can be made of the amount of the obligation.

An entity will be deemed to have a constructive obligation where (a) the entity has assumed certain responsibilities as a consequence of past practices or public policies and (b) as a result, the entity has created an expectation that it will discharge those responsibilities.

The Group recognizes the following provisions:

For labor, civil and commercial lawsuits: These provisions are calculated on the basis of attorneys’ reports about the status of the proceedings and the estimate about the potential losses the Group may sustain, as well as on the basis of past experience in proceedings of these kinds.

For miscellaneous risks: These provisions are set up to address contingencies that may trigger obligations for the Group. In estimating the provision amounts, the Group evaluates the likelihood of occurrence taking into consideration the opinion of its legal and professional advisors.

The provision amount recognized by the Group must be the best estimate at the reporting period-end of the disbursement required to settle the current obligation.

Where the financial effect of the discount is material, the provision amount must be the present value of the disbursements expected to be required to settle the obligation, applying a pre-tax interest rate that reflects prevailing market conditions on the value of money and the risks specific to such obligation. The increase in the provision due to the passage of time is recognized under Financial Income (Loss), Net in the income statement.

22

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The Group will not account for positive contingencies, other than those arising from deferred taxes and those whose occurrence is virtually certain.

As of the date of these consolidated condensed interim financial statements, the Group’s management believes there are no elements leading to the determination of the existence of contingencies that might materialize and have a negative impact on these consolidated condensed interim financial statements other than those set forth in Note 8.3.

The Group evaluates, at the end of the reporting period, the adjustment of insurance liabilities that have been recognized, using the current estimates of future cash flows from insurance contracts. If the evaluation shows that the carrying amount of its liabilities for insurance contracts (less deferred acquisition costs and related intangible assets) is not adequate, considering the estimated future cash flows, the total amount of the inadequacy will be recognized in profit or loss. According to IFRS 4, the Group will be required to determine the adequacy of the carrying amount recorded pursuant to the guidelines set out in IAS 37.

1.22.        OTHER NON-FINANCIAL LIABILITIES

Non-financial accounts payable are accrued when the counterparty has fulfilled its contractual obligations and are measured at amortized cost.

1.23.        NOTES ISSUED

The notes issued by the Group are measured at amortized cost. Where the Group buys back its own notes, the liability in respect of such notes will be deemed discharged and, accordingly, the notes will be derecognized. Where the Group buys back its own debt, such debt will be removed from its separate condensed interim financial statements and the difference between the residual value of the financial liability and the amount paid will be recognized as financial income or expense, as the case may be.

1.24.        SHAREHOLDERS’ EQUITY

Shareholders’ equity accounts are stated in a currency which does not reflect the changes in the price index since February 2003, except for the item “Capital Stock”, which is carried at face value. The restatement adjustment is included in “Adjustments to Shareholders’ Equity.”

Ordinary shares are recognized in shareholders’ equity and carried at face value. When any company comprising the Group buys shares of the Company’s capital stock (treasury stock), the payment made, including any cost directly attributable to the transaction (net of taxes), is deducted from shareholders’ equity until the shares are either canceled or disposed of.

1.25.        PROFIT RESERVES

Pursuant to Section 70 of the General Corporations Law, the Company and its subsidiaries, other than the Bank, are required to appropriate 5% of the net income for the fiscal year to the legal reserve until such reserve is equal to 20% of capital stock, plus the balance of the Capital Adjustment account.

With respect to the Bank, according to the regulations set forth by the Argentine Central Bank, 20% of net income for the fiscal year, net of previous years’ adjustments, if any, is required to be appropriated to the legal reserve. Notwithstanding the aforementioned, in appropriating amounts to other reserves, financial institutions are required to comply with the provisions laid down by the Argentine Central Bank in the revised text on distribution of dividends described in Note 10.8.

1.26.        DISTRIBUTION OF DIVIDENDS

The distribution of dividends to the Group’s shareholders is recognized as a liability in the consolidated condensed interim financial statements for the fiscal year in which dividends are approved by the Group’s shareholders.

1.27.        REVENUE RECOGNITION

Financial income and expense is recognized in respect of all debt instruments in accordance with the effective rate method, pursuant to which all gains and losses which are an integral part of the transaction effective rate are deferred.

Gains or losses included in the effective rate embrace disbursements or receipts relating to the creation or acquisition of a financial asset or liability, such as payments received for the analysis of the customer’s financial position, negotiation of the instrument terms, preparation and processing of the documents required to consummate the

23

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

transactions, and payments received for the extension of credit arrangements expected to be used by the customer. The Group accounts for its non-derivative financial liabilities at amortized cost, except for those included in “Fair Value Liabilities with Changes to Income,” which are measured at fair value.

Fees and commissions earned by the Group on the origination of syndicated loans are not part of the product effective rate, and are recognized in the income statement at the time the service is delivered, to the extent the Group does not retain a portion of the same, or such effective rate is maintained under the same conditions as the other participants. Commissions and fees earned by the Group on negotiations in third parties’ transactions are not part of the effective rate either, and are recognized at the time the transactions are executed.

The Group’s income from services is recognized in the income statement as performance obligations are fulfilled, thus differing income from customer loyalty programs, which are accounted for at the fair value of the points and the redemption rate, until such time as points are redeemed by customers and may be charged to profit or loss for the period.

1.28.    INCOME TAX AND MINIMUM PRESUMED INCOME TAX

1.28.1.    Income Tax

The income tax expense for the period includes current and deferred tax. Income tax is recognized in the consolidated income statement, except for items required to be recognized directly in other comprehensive income. In this case, the income tax liability related to such items is also recognized in such statement.

The current income tax expense is calculated on the basis of the tax laws enacted or substantially enacted as of the balance sheet date in the countries where the Group operates and generates taxable income. The Group periodically assesses the position assumed in tax returns in connection with circumstances in which the tax laws are subject to interpretation. On the other hand, when required, the Group sets up provisions in respect of the amounts expected to be required to pay to the tax authorities.

Deferred income tax is determined, in its entirety, by applying the liability method on the temporary differences arising from the carrying amount of assets and liabilities and their tax base. However, the deferred tax arising from the initial recognition of an asset or liability in a transaction other than a business combination which, at the time of the transaction does not affect income or loss for accounting or tax purposes, is not recorded. The deferred tax is determined using tax rates (and laws) enacted as of the balance sheet date and that are expected to be applicable when the deferred tax assets are realized or the deferred tax liabilities are settled.

Deferred tax assets are recognized only to the extent future tax benefits are likely to arise against which the temporary differences might be offset.

The Group recognizes a deferred tax liability for taxable temporary differences related to investments in subsidiaries and affiliates, except that the following two conditions are met:

(i) the Group controls the timing on which temporary differences will be reversed;

(ii) such temporary differences are not likely to be reversed in the foreseeable future.

The balances of deferred tax assets and liabilities are offset when a legal right exists to offset current tax assets against current tax liabilities and to the extent such balances are related to the same tax authority of the Group or its subsidiaries, where tax balances are intended to be, and may be, settled on a net basis.

1.28.2.        Minimum Presumed Income Tax

The Group determines the minimum presumed income tax at the effective rate of 1% of the computable assets at each fiscal year-end. This tax is supplementary to income tax. The Group’s tax liability is equal to the higher of the two taxes. However, if the minimum presumed income tax were to exceed income tax in a given fiscal year, such excess may be computed as a payment on account of the income tax that could be generated in any of the next ten fiscal years.

The minimum presumed income tax credit disclosed under Other Non-current Receivables is the portion expected to be offset against the income tax in excess of minimum presumed income tax to be generated in the following ten fiscal years.

24

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

1.29.        EARNINGS PER SHARE

Basic earnings per share are calculated as income (loss) attributable to the Group’s ordinary shareholders, excluding the after-tax effect of benefits attached to preferred shares, divided by average ordinary shares outstanding.

Diluted earnings per share are calculated by adjusting income (loss) attributable to shareholders and average ordinary shares outstanding for the effects of the potential conversion into equity instruments of all convertible notes held by the Group at period-end.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

The preparation of these consolidated condensed interim financial statements in accordance with the IFRS-based accounting framework requires the use of certain significant accounting estimates. It also requires that management make judgments in applying the accounting standards set forth by the Argentine Central Bank to define the Group’s accounting criteria.

The Group has identified the following areas which involves a higher degree of judgment or complexity, or the areas in which the assumptions and estimates are material for these condensed interim financial statements, as essential to understand the underlying accounting/financial reporting risks.

a.        FAIR VALUE OF DERIVATIVE INSTRUMENTS AND OTHER INSTRUMENTS

The fair value of financial instruments not listed in active markets is determined using valuation techniques. Such techniques are validated and reviewed periodically by qualified personnel independent from the area which developed them. All models are assessed and adjusted before being put into use in order to ensure that results reflect current information and comparable market prices. Where possible, models rely on observable information only; however, certain factors, such as the Group’s own and the counterparty’s credit risk, volatilities and correlations, require the use of estimates. Changes in the assumptions about these factors may affect the reported fair value of financial instruments.

b.       IMPAIRMENT LOSSES ON LOANS AND ADVANCES

The Group makes estimates about its customers’ repayment capacity to determine the provision level it is required to set up according to the Argentine Central Bank regulations.

Such estimates are made as frequently as required by the minimum loan loss provisions set forth by the Argentine Central Bank.

Requirements for Allowances for Loan Losses

The Argentine Central Bank requires that minimum allowances for loan losses be setup for the different categories in which customers are classified. The rates vary by category and by whether the loans are secured. The percentages apply to total customer obligations, both principal and interest. The allowance for loan losses on the performing portfolio is unallocated, while allowances for the other categories are individually allocated. The regulations require the suspension of interest accrual or the setup of allowances for the 100% of interest for customers classified as “With Problems”, “Medium Risk,” or lower.

c.        IMPAIRMENT OF NON-FINANCIAL ASSETS

Intangible assets with definite useful life and property, plant and equipment are amortized or depreciated on a straight-line basis during their estimated useful lives. The Group monitors the conditions associated with these assets to determine whether the events and circumstances warrant a review of the remaining amortization or depreciation term and whether there are factors or circumstances indicating impairment in the value of the asset which might not be recoverable.

Identifying the indicators of impairment of property, plant and equipment and intangible assets requires the use of judgment. The Group has concluded that there were no indicators of impairment for any of the periods reported in its consolidated condensed interim financial statements.

25

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

d.        INCOME TAX AND DEFERRED TAX

The assessment of current and deferred tax assets and liabilities requires a significant level of judgment. Current income tax is accounted for according to the amounts expected to be paid, while deferred income tax is accounted for on the basis of the temporary differences between the carrying amount of assets and liabilities and their tax base, at the rates expected to be in force at the time of reversal of such differences.

A deferred tax asset is recognized when future taxable income is expected to exist to offset such temporary differences, based on management’s assumptions about the amounts and timing of such future taxable income. Then, management needs to determine whether deferred tax assets are likely to be used and offset against future taxable income. Actual results may differ from these estimates, for instance, changes in the applicable tax laws or the outcome of the final review of the tax returns by the tax authorities and tax courts.

Future taxable income and the number of tax benefits likely to be available in the future are based on a medium-term business plan prepared by management, on the basis of expectations which are deemed reasonable.

NOTE 3. TRANSITION TO IFRS

3.1.    REQUIREMENTS FOR THE TRANSITION TO IFRS

The following is a reconciliation between the shareholders’ equity, income statement, other comprehensive income and statement of cash flows amounts related to the consolidated financial statements issued according to the accounting framework in effect prior to the transition date (January 1, 2017), the adoption date (December 31, 2017) and the closing date of the comparative period (September 30, 2017) and the amounts presented according to the IFRS-based accounting framework (see Note 1.1) in these consolidated condensed interim financial statements, as well as the effects of adjustments to cash flows.

Consolidated Balance Sheet	Prior Accounting Framework 12.31.17		Reclassifications			Adjustments			References(*)		IFRS-based Accounting Framework (See Note 1.1) 12.31.17
ASSETS
Cash and Bank Deposits		56,659,196		2,605,614			(321,544	)		(**)		58,943,266
Government and Private Securities		38,770,736		(38,770,736	)		-					-
Loans and Other Financing Activities		197,335,168		(197,335,168	)		-					-
Other Receivables Resulting from Financial Brokerage		33,358,644		(33,358,644	)		-					-
Receivables from Financial Leases		1,676,637		(1,676,637	)		-					-
Investments in Subsidiaries, Associates and Joint Ventures		28,704		(28,704	)		-			(a)		-
Miscellaneous Receivables		3,809,643		(3,809,643	)		-					-
Property, Plant and Equipment		4,469,499		577,406			4,743,493			(b)		9,790,398
Miscellaneous Assets		623,762		(623,762	)		-					-
Intangible Assets		3,577,022		(2,290,939	)		(380,222	)		(c)		905,861
Unallocated Items		71,277		(71,277	)		-					-
Other Assets		632,272		(632,272	)		-					-
Fair Value Debt Securities with Changes to Income		-		29,239,569			(261,329	)		(d)		28,978,240
Derivative Instruments		-		537,000			-			(e)		537,000
Repo Transactions		-		9,676,101			-					9,676,101
Other Financial Assets		-		7,020,044			37,797			(f)		7,057,841
Loans and Other Financing Activities		-		199,737,602			(6,970,275	)		(g)		192,767,327
Other Debt Securities		-		2,589,436			119,216			(h)		2,708,652
Financial Assets Pledged as Collateral		-		6,395,575			(65,018	)		(j)		6,330,557
Current Income Tax Assets		-		300,546			(105,741	)		(**)		194,805
Investments in Equity Instruments		-		20,870			54,936			(i)		75,806
Deferred Income Tax Assets		-		548,204			15,000			(p)		563,204
Other Non-financial Assets		-		3,472,826			(620,218	)		(k)		2,852,608
Non-current Assets Held for Sale		-		4,740,383			1,144,671			(l)		5,885,054
TOTAL ASSETS		341,012,560		(11,136,606	)		(2,609,234	)				327,266,720

(*) The references are related to the explanations included in Note 3.5.

(**) The adjustments are related to the deconsolidation of Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A., as detailed in Note 7.3.

26

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Consolidated Balance Sheet	Prior Accounting Framework 12.31.17		Reclassifications			Adjustments			References(*)		IFRS-based Accounting Framework (See Note 1.1) 12.31.17
LIABILITIES
Deposits		203,450,563		337			(2,733,996	)		(**)		200,716,904
Other Liabilities Resulting from Financial Brokerage		81,343,100		(81,343,100	)		-					-
Miscellaneous Liabilities		8,570,777		(8,570,777	)		-					-
Provisions		713,208		-			(105,753	)		(m)		607,455
Subordinated Notes		4,828,018		-			-					4,828,018
Unallocated Items		55,673		(55,673	)		-					-
Minority Interest		1,935,141		(1,935,196	)		55					-
Other Liabilities		815,875		(815,875	)		-			(r)		-
Derivative Instruments		-		584,856			-					584,856
Repo Transactions		-		1,131,127			-					1,131,127
Other Financial Liabilities		-		37,424,437			64,488			(n)		37,488,925
Loans from the Argentine Central Bank and Other Financial Institutions		-		8,496,778			(627,730	)		(o)		7,869,048
Notes Issued		-		16,042,727			(2,303,661	)		(**)		13,739,066
Current Income Tax Liabilities		-		3,303,611			(231,923	)		(**)		3,071,688
Deferred Income Tax Liabilities		-		7,431			683,612			(p)		691,043
Other Non-financial Liabilities		-		13,581,655			(191,430	)		(q)		13,390,227
TOTAL LIABILITIES		301,712,355		(12,147,662	)		(5,446,338	)				284,118,357
SHAREHOLDERS’ EQUITY
Capital Stock, Contributions and Reserves		30,970,736		(924,140	)		-					30,046,596
Retained Income		-		(2,745	)		2,529,070					2,526,325
Other Accumulated Comprehensive Income		-		-			17,279					17,279
Net Income for the Fiscal Year		8,329,469		2,745			290,755					8,622,967
Shareholders’ Equity Attributable to the Controlling Company’s Shareholders		39,300,205		(924,140	)		2,837,104					41,213,167
Shareholders’ Equity Attributable to Non-controlling Interests		-		1,935,196			-					1,935,196
TOTAL SHAREHOLDERS’ EQUITY		39,300,205		1,011,056			2,837,104					43,148,363

(*) The references are related to the explanations included in Note 3.5.

(**) The adjustments are related to the deconsolidation of Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A., as detailed in Note 7.3.

27

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Consolidated Balance Sheet	Prior Accounting Framework 09.30.17		Reclassifications			Adjustments			References(*)		IFRS-based Accounting Framework (See Note 1.1) 09.30.17
ASSETS
Cash and Bank Deposits		36,152,367		(479,402	)		(300,087	)		(**)		35,372,878
Government and Private Securities		32,220,753		(32,220,753	)		-					-
Loans and Other Financing Activities		173,743,647		(173,743,647	)		-					-
Other Receivables Resulting from Financial Brokerage		18,412,357		(18,412,357	)		-					-
Receivables from Financial Leases		1,446,264		(1,446,264	)		-					-
Investments in Subsidiaries, Associates and Joint Ventures		27,902		(22,659	)		186,702			(a)		191,945
Miscellaneous Receivables		3,916,753		(3,916,753	)		-					-
Property, Plant and Equipment		4,220,738		360,671			4,598,946			(b)		9,180,355
Miscellaneous Assets		534,379		(534,379	)		-					-
Intangible Assets		3,110,896		(1,855,273	)		(476,458	)		(c)		779,165
Unallocated Items		65,211		(65,211	)		-					-
Other Assets		550,977		(550,977	)		-					-
Fair Value Debt Securities with Changes to Income		-		33,863,030			(217,163	)		(d)		33,645,867
Derivative Instruments		-		250,946			-					250,946
Repo Transactions		-		2,156,053			(120,155	)				2,035,898
Other Financial Assets		-		5,373,515			(196,615	)		(f)		5,176,900
Loans and Other Financing Activities		-		175,959,555			(7,328,328	)		(g)		168,631,227
Other Debt Securities		-		1,153,442			243,192			(h)		1,396,634
Financial Assets Pledged as Collateral		-		5,907,871			(399,545	)		(j)		5,508,326
Current Income Tax Assets		-		570,413			(37,327	)		(**)		533,086
Investments in Equity Instruments		-		20,125			43,838			(i)		63,963
Deferred Income Tax Assets		-		578,839			17,500			(p)		596,339
Other Non-financial Assets		-		3,222,907			(440,223	)		(k)		2,782,684
Non-current Assets Held for Sale		-		5,676,085			(2	)		(l)		5,676,083
TOTAL ASSETS		274,402,244		1,845,777			(4,425,725	)				271,822,296

(*) The references are related to the explanations included in Note 3.5.

(**) The adjustments are related to the deconsolidation of Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A., as detailed in Note 7.3.

28

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Consolidated Balance Sheet	Prior Accounting Framework 09.30.17		Reclassifications			Adjustments			References(*)		IFRS-based Accounting Framework (See Note 1.1) 09.30.17
LIABILITIES
Deposits		164,414,771		(30,810	)		(2,202,166	)		(**)		162,181,795
Other Liabilities Resulting from Financial Brokerage		59,226,462		(59,226,462	)		-					-
Miscellaneous Liabilities		7,962,223		(7,962,223	)		-					-
Provisions		616,309		(435,194	)		265,506			(m)		446,621
Subordinated Notes		4,360,056		-			-					4,360,056
Unallocated Items		96,067		(96,067	)		-					-
Minority Interest		1,766,093		(1,766,111	)		18					-
Other Liabilities		765,548		(765,548	)		-			(r)		-
Derivative Instruments		-		215,066			-					215,066
Repo Transactions		-		1,182,750			(192,682	)				990,068
Other Financial Liabilities		-		28,352,082			(322,281	)		(n)		28,029,801
Loans from the Argentine Central Bank and Other Financial Institutions		-		7,649,049			(820,777	)		(o)		6,828,272
Notes Issued		-		15,398,315			(1,840,811	)		(**)		13,557,504
Current Income Tax Liabilities		-		3,000,627			(414,524	)		(**)		2,586,103
Deferred Income Tax Liabilities		-		4,109			1,047,342			(p)		1,051,451
Other Non-financial Liabilities		-		15,484,222			(2,605,172	)		(q)		12,879,050
TOTAL LIABILITIES		239,207,529		1,003,805			(7,085,547	)				233,125,787
SHAREHOLDERS’ EQUITY
Capital Stock, Contributions and Reserves		29,541,295		(924,140	)		-					28,617,155
Retained Income		-		(126,160	)		2,652,485					2,526,325
Other Accumulated Comprehensive Income		-		-			7,339					7,339
Net Income for the Fiscal Year		5,653,420		126,160			-					5,779,580
Shareholders’ Equity Attributable to the Controlling Company’s Shareholders		35,194,715		(924,140	)		2,659,824					36,930,399
Shareholders’ Equity Attributable to Non-controlling Interests		-		1,766,110			-					1,766,110
TOTAL SHAREHOLDERS’ EQUITY		35,194,715		841,971			2,659,824					38,696,509

(*) The references are related to the explanations included in Note 3.5.

(**) The adjustments are related to the deconsolidation of Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A., as detailed in Note 7.3.

29

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Consolidated Balance Sheet	Prior Accounting Framework 01.01.17		Reclassifications			Adjustments			References(*)		IFRS-based Accounting Framework (See Note 1.1) 01.01.17
ASSETS
Cash and Bank Deposits		61,166,250		4,992,005			(390,690	)		(**)		65,767,565
Government and Private Securities		13,700,800		(13,700,800	)		-					-
Loans and Other Financing Activities		137,451,655		(137,451,655	)		-					-
Other Receivables Resulting from Financial Brokerage		18,178,275		(18,178,275	)		-					-
Receivables from Financial Leases		955,346		(955,346	)		-					-
Investments in Subsidiaries, Associates and Joint Ventures		52,964		(30,344	)		133,049			(a)		155,669
Miscellaneous Receivables		3,440,115		(3,440,115	)		-					-
Property, Plant and Equipment		2,873,552		1,056,561			4,601,438			(b)		8,531,551
Miscellaneous Assets		1,221,237		(1,221,237	)		-					-
Intangible Assets		2,582,255		(1,171,968	)		(579,183	)		(c)		831,104
Unallocated Items		89,035		(89,035	)		-					-
Other Assets		539,140		(539,140	)		-					-
Fair Value Debt Securities with Changes to Income		-		15,214,083			1,075,481			(d)		16,289,564
Derivative Instruments		-		124,260			261			(e)		124,521
Repo Transactions		-		-			-					-
Other Financial Assets		-		4,038,002			(401,031	)		(f)		3,637,971
Loans and Other Financing Activities		-		138,708,885			(4,826,609	)		(g)		133,882,276
Other Debt Securities		-		1,153,225			(191,262	)		(h)		961,963
Financial Assets Pledged as Collateral		-		5,676,405			(197,551	)		(j)		5,478,854
Current Income Tax Assets		-		224,825			(98,710	)		(**)		126,115
Investments in Equity Instruments		-		30,412			71,151			(i)		101,563
Deferred Income Tax Assets		-		545,912			17,500			(p)		563,412
Other Non-financial Assets		-		2,475,191			(222,196	)		(k)		2,252,995
Non-current Assets Held for Sale		-		4,740,064			1,186,019			(l)		5,926,083
TOTAL ASSETS		242,250,624		2,202,915			177,667					244,631,206

(*) The references are related to the explanations included in Note 3.5.

(**) The adjustments are related to the deconsolidation of Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A., as detailed in Note 7.3.

30

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Consolidated Balance Sheet	Prior Accounting Framework 01.01.17		Reclassifications			Adjustments			References(*)		IFRS-based Accounting Framework (See Note 1.1) 01.01.17
LIABILITIES
Deposits		151,688,147		3,236			(1,314,318	)		(**)		150,377,065
Other Liabilities Resulting from Financial Brokerage		57,793,653		(57,793,653	)		-					-
Miscellaneous Liabilities		5,804,284		(5,804,284	)		-					-
Provisions		384,484		-			392			(m)		384,876
Subordinated Notes		4,065,255		-			-					4,065,255
Unallocated Items		70,530		(70,530	)		-					-
Minority Interest		1,462,189		(1,451,883	)		(10,306	)				-
Other Liabilities		629,382		(629,382	)		-			(r)		-
Fair Value Liabilities with Changes to Income		-		-			-					-
Derivative Instruments		-		239,135			(81,536	)		(e)		157,599
Repo Transactions		-		1,782,068			(137,858	)		(**)		1,644,715
Other Financial Liabilities		-		31,257,938			41,354			(n)		31,299,292
Loans from the Argentine Central Bank and Other Financial Institutions		-		7,479,171			(582,349	)		(o)		6,896,317
Notes Issued		-		13,012,842			(1,155,124	)		(**)		11,857,718
Current Income Tax Liabilities		-		1,997,323			(175,174	)		(**)		1,822,149
Deferred Income Tax Liabilities		-		6,678			931,591			(p)		938,269
Other Non-financial Liabilities		-		10,722,373			(149,512	)		(q)		10,572,861
TOTAL LIABILITIES		221,897,924		751,032			(2,632,840	)				220,016,116
SHAREHOLDERS’ EQUITY
Capital Stock, Adjustments and Reserves		14,334,823		-			-					14,334,823
Retained Income		6,017,877		-			2,526,325					8,544,202
Other Accumulated Comprehensive Income		-		-			284,182					284,182
Net Income for the Fiscal Year		-		-			-					-
Shareholders’ Equity Attributable to the Controlling Company’s Shareholders		20,352,700		-			2,810,507					23,163,207
Shareholders’ Equity Attributable to Non-controlling Interests		-		1,451,883			-					1,451,883
TOTAL SHAREHOLDERS’ EQUITY		20,352,700		1,451,883			2,810,507					24,615,090

(*) The references are related to the explanations included in Note 3.5.

(**) The adjustments are related to the deconsolidation of Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A., as detailed in Note 7.3.

31

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

CONSOLIDATED INCOME STATEMENT	Prior Accounting Framework 09.30.17		Reclassifications			Adjustments			IFRS-based Accounting Framework (See Note 1.1) 09.30.17
Financial Income		32,002,126		(32,002,126	)		-			-
Financial Expenses		(14,693,155)		14,693,155			-			-
Provisions for Loan Losses		(3,737,053)		(7,875	)		428,037			(3,316,891	)
Income from Services		15,266,401		(15,266,401	)		-			-
Expenses from Services		(4,667,200)		4,667,200			-			-
Administrative Expenses		(16,551,766)		8,969,567			556,981			(7,025,218	)
Underwriting Income		1,510,764		138,923			223			1,649,910
Minority Interest		(457,106)		457,106			-			-
Miscellaneous Income		1,198,269		(1,198,269	)		-			-
Miscellaneous Losses		(711,080)		711,080			-			-
Income Tax		(3,506,781)		3,506,781			-			-
Interest Income				27,314,897			(2,467,956	)		24,846,941
Interest Expense		-		(11,760,678	)		672,956			(11,087,722	)
Commission Income		-		16,113,589			(4,264,277	)		11,849,312
Commission Expense		-		(1,662,804	)		61,098			(1,601,706	)
Net Income (Loss) from Measurement of Fair Value Financial Instruments with Changes to Income		-		3,671,534			(226,923	)		3,444,611
Income (Loss) from Derecognition of Assets Measured at Amortized Cost		-		-			-			-
Exchange Rate Differences on Gold and Foreign Currency		-		1,516,003			18,393			1,534,396
Other Operating Income		-		(320,955	)		3,771,989			3,451,034
Employee Benefits		-		(8,203,318	)		516,811			(7,686,507	)
Depreciation and Impairment of Assets		-		(891,824	)		114,570			(777,254	)
Other Operating Expenses				(6,015,513	)		319,500			(5,696,013	)
Income (Loss) for Associates and Joint Ventures		-		(200,875	)		382,315			181,440
Income Tax from Continuing Activities		-		(3,401,366	)		56,666			(3,344,700	)
Income (Loss) from Discontinued Operations		-		-			-			-
Income Tax from Discontinued Activities		-		(370,724	)		185,362			(185,362	)
Net Income for the Period		5,653,419		457,107			125,745			6,236,271
Other Comprehensive Income (Loss)		-		-			(276,843	)		(276,843	)
Total Comprehensive Income (Loss)		5,653,419		457,107			(151,098	)		5,959,428
Total Comprehensive Income (Loss) Attributable to the Controlling Company’s Shareholders		5,653,419		-			(150,682	)		5,502,737
Total Comprehensive Income (Loss) Attributable to Non-controlling Interests		-		457,107			(416	)		456,691

The significant adjustments to Cash Flows, as required by IFRS 1, paragraph 25, are as follows:

a. Under the prior accounting framework, Cash and Due from Banks and highly-liquid investments originally due in three months or less were considered to be Cash and Cash Equivalents. Under the IFRS-based accounting framework, Cash and Bank Deposits, including foreign currency purchases and sales pending settlement originally due in three months or less, and highly-liquid investments originally due in three months or less are considered to be Cash and Cash Equivalents.

b. Under the prior accounting framework, cash and cash equivalents of equity investments in Compañía Financiera Argentina S.A. (CFA) and Cobranzas y Servicios S.A. (CyS) were consolidated with those of the Group. Under the IFRS-based accounting framework, both companies are disclosed under Non-current Assets Held for Sale and, consequently, have not been consolidated.

32

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The reconciliation of cash and cash equivalents is as follows:

Cash and Cash Equivalents	Prior Accounting Framework 09.30.17		CFA + CyS     Discontinued     Operations			Adjustments			IFRS-based         Accounting         Framework 09.30.17
Cash and Bank Deposits		36,152,367		(338,910	)		(440,579	)		35,372,878
Argentine Central Bank Bills and Notes Maturing within up to 90 days		20,374,017		-			1,811,562			22,185,579
Receivables from Reverse Repo Transactions		1,994,616		-			(87,400	)		1,907,216
Local Interbank Loans		783,000		-			-			783,000
Overnight Placements in Banks Abroad		5,156,338		-			19,098			5,175,436
Other Cash Equivalents		2,784,039		-			(22,148	)		2,761,891
Total		67,244,377		(338,910	)		1,280,533			68,186,000
Cash and Cash Equivalents	Prior Accounting Framework 01.01.17		CFA + CyS Discontinued Operations			Adjustments			IFRS-based Accounting Framework 01.01.17
Cash and Bank Deposits		61,166,250		(390,690	)		4,992,005			65,767,565
Argentine Central Bank Bills and Notes Maturing within up to 90 days		6,635,954		-			267,655			6,903,609
Local Interbank Loans		862,300		-			-			862,300
Overnight Placements in Banks Abroad		1,227,101		-			-			1,227,101
Cash Equivalents from Subsidiaries		3,196,060		-			(5,577	)		3,190,483
Total		73,087,665		(390,690	)		5,254,083			77,951,058

c. Under the prior accounting framework, cash flows from Intangible Assets, Dividends Earned for Investments in Associates and Cash Flows with the Argentine Central Bank were disclosed as cash flows provided by operating activities. Under the IFRS-based accounting framework, cash flows from Intangible Assets and Dividends Earned for Investments in Subsidiaries and Associates are disclosed as cash flows provided by investing activities, while those from loans from the Argentine Central Bank are disclosed as cash flows provided by financing activities.

d. Cash flows from CFA and CyS, as mentioned in subsection b. above, have not been consolidated in accordance with the IFRS-based accounting framework.

The reconciliation of cash flows is as follows:

Cash and Cash Equivalents	Prior Accounting Framework 09.30.17		CFA + CyS Discontinued Operations			Adjustments			IFRS-based Accounting Framework 09.30.17
Operating Activities (I)		(16,279,101)		(120,919	)		(3,084,658	)		(19,484,678	)
Investing Activities (II)		(818,198)		266,419			(500,541	)		(1,052,320	)
Financing Activities (III)		8,767,197		(197,538	)		(250,746	)		8,318,913
Effect of Changes in the Exchange Rate		2,486,814		-			(33,402	)		2,453,412
Total		(5,843,288)		(52,038	)		(3,869,347	)		(9,764,673	)

33

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

(I) Operating Activities
Cash Flows According to Argentine Central Bank Regulations as of 09.30.17	(16,279,101	)
CFA + CyS Discontinued Operations	(120,919	)
Adjustments that Affect Cash Flows from Operating Activities	(3,553,189	)
Intangible Assets	1,004,352
Miscellaneous Assets	(381,834	)
Other Collections Related to Subsidiaries	(94,343	)
Dividends Cashed from Subsidiaries	(59,644	)
Cash Flows According to the IFRS-based Accounting Framework as of 09.30.17	(19,484,678	)
(II) Investing Activities
Cash Flows According to Argentine Central Bank Regulations as of 09.30.17	(818,198	)
CFA + CyS Discontinued Operations	266,419
Miscellaneous Assets	381,834
Dividends Cashed from Subsidiaries	59,644
Adjustments to Determine Investing Activities	(32,010	)
Other Collections Related to Subsidiaries	94,343
Intangible Assets	(1,004,352)
Cash Flows According to the IFRS-based Accounting Framework as of 09.30.17	(1,052,320	)
(III) Financing Activities
Cash Flows According to Argentine Central Bank Regulations as of 09.30.17	8,767,197
CFA + CyS Discontinued Operations	(197,538	)
Adjustments to Determine Financing Activities	(250,746	)
Cash Flows According to the IFRS-based Accounting Framework as of 09.30.17	8,318,913
Effect of Changes in the Exchange Rate
Cash Flows According to Argentine Central Bank Regulations as of 09.30.17	2,486,814
Adjustments to Determine Financing Activities	(33,402	)
Cash Flows According to the IFRS-based Accounting Framework as of 09.30.17	2,453,412

3.2.    OPTIONAL EXEMPTIONS TO IFRS

IFRS 1 allows entities that adopt IFRS for the first time to consider certain one-time exceptions. Such exceptions have been established by the IASB to make the first application of IFRS simpler, eliminating the mandatory nature of their retroactive application.

Below are the optional exemptions applicable to the Group under IFRS 1:

1. Attributed Cost of Bank Property, Plant and Equipment and Investment Properties: The current value of bank property, plant and equipment and investment properties has been adopted as attributed cost as of the date of transition to IFRS.

2. Business Combinations: The Group has opted for not applying IFRS 3 “Business Combinations” retroactively for business combinations prior to the date of transition to IFRS.

3. Assets and Liabilities of Subsidiaries that Have Already Applied IFRS: The Group has adopted IFRS for the first time after its subsidiary Tarjetas Regionales S.A. and its related subsidiaries. Consequently, it has measured the assets and liabilities of such subsidiaries in its consolidated condensed interim financial statements for the same carrying amounts disclosed in their financial statements.

The Group has not made use of other exemptions available in IFRS 1.

34

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

3.3.    MANDATORY EXCEPTIONS TO IFRS

Below are the mandatory exceptions applicable to the Group under IFRS 1:

1. Estimates: The estimates made by the Group according to IFRS as of January 1, 2017 (date of transition to IFRS) are consistent with the estimates made as of the same date according to the Argentine Central Bank’s accounting standards, considering what is described in Note 1.1 (non-application of the impairment chapter of IFRS 9).

2. Accounting derecognition of financial assets and liabilities: The Group applied the criteria of accounting derecognition of financial assets and liabilities under IFRS 9 prospectively for transactions occurred after January 1, 2017.

3. Classification and measurement of financial assets: The Group has considered the existing events and circumstances as of January 1, 2017 in its evaluation of whether the financial assets meet the characteristics to be classified as assets measured at amortized cost or at fair value with changes in profit or loss or at fair value with changes in other comprehensive income.

4. Other mandatory exceptions established by IFRS 1 that have not been applied because of their immateriality to the Group are:

- Hedge accounting

- Non-controlling interests

- Embedded derivatives

- Government loans

The other exceptions established by IFRS 1 have not been applied because of their immateriality to the Group.

3.4.    RECLASSIFICATIONS

The items recognized under the prior accounting framework, which were reclassified according to the IFRS-based accounting framework and as detailed in point 3.1., are described below.

3.4.1.    Assets

Spot Purchases and Sales Pending Settlement: According to standards in effect until December 31, 2017, these transactions were recorded as Other Receivables Resulting from Financial Brokerage and Other Liabilities Resulting from Financial Brokerage, respectively. Upon using the criterion of the date of closing, a spot purchase transaction pending settlement will imply recording the security to be received in the respective account, with the applicable measurement criterion, while the spot sale pending settlement will imply the derecognition of the security. The currency transactions pending settlement have been reclassified as cash equivalents and those of securities have been included in the respective holdings.

Reverse Repo Transactions: Under the prior accounting framework, the security in such transactions was recognized in the holding and the obligation to deliver it at the end of the transaction in Other Liabilities Resulting from Financial Brokerage. The loan granted was recorded in Other Receivables Resulting from Financial Brokerage. Under the IFRS-based accounting framework, the financial assets acquired through reverse repo transactions for which the risks and benefits have not been transferred shall be recognized as a loan granted with securities offered as collateral. Therefore, the reclassification between the accounts mentioned above has been made.

Leasehold Improvements: According to the prior accounting framework, they were disclosed under Intangible Assets. According to the IFRS-based accounting framework, those leasehold improvements are part of Property, Plant and Equipment.

Equity Investments: As discussed in Prisma Medios de Pago S.A.’s Ordinary and Extraordinary Shareholders’ Meeting held on August 31, 2017, the shareholders wished to transfer all of the shares of the company. Therefore, according to IFRS 5 this is considered as Non-current Assets Held for Sale and valued at the lower of the carrying amount and fair value, less costs to sell at closing. Such reclassification was made as of December 31, 2017.

Likewise, Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A. are disclosed under Equity Investments, under the prior accounting framework. As mentioned above regarding IFRS 5, it has been reclassified in the same account (See Note 7.3).

Repurchase of Notes: We have adjusted our own notes held in portfolio in accordance with IFRS. According to IFRS, an issuer’s repurchase of its own debt has the effect of settling the respective liability.

35

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Liability from Purchase of Minority Interests: As of December 31, 2017, a financial liability has been recognized for the purchase of a 6% interest in Tarjetas Regionales S.A. IFRS 32, paragraph 23, sets forth that a commitment to buy treasury shares is to be accounted for as a financial liability for the present value of the selling price. The liability is recognized with its corresponding offsetting entry in equity, as the risks and rewards associated with the shares are retained by the minority shareholders until the actual transfer of such shares. The transaction totaled $924,140 and the amount recognized against other shareholders’ equity reserves was $419,307.

3.4.2.     Income Statement

Commissions on Origination of Loans and Lending Expenses: According to the prior accounting framework, commissions on structuring should be disclosed under Income from Services and lending expenses, under Expenses from Services. According to IFRS 9, such commissions are part of the necessary cash flows to calculate the IRR on loans. Accordingly, the respective reclassification has been made to Interest Income.

3.5.    Adjustments by Applying IFRS as of the Date of Transition

As of the date of transition, according to the prior accounting framework, the Group also consolidated Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A.

Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A. have been classified as Held for Sale under IFRS 5 since the respective agreements for their transfer have been signed. The effect is disclosed in all the accounts that were consolidated according to the prior accounting framework, as detailed in Note 3.1.

According to IFRS, an investor controls a subsidiary if it is exposed to or is entitled to variable returns due to its involvement in such entity and if it is capable of allocating such returns through its power over the subsidiary. By applying the principle of control under IFRS 10, the Financial Trust Galtrust I and the Financial Trust Saturno Créditos, which were not considered as controlled entities under Argentine Central Bank regulations, have been consolidated.

The following are additional adjustments that have been made as a result of the IFRS-based accounting framework, which were made to amounts recognized under the prior accounting framework, and are detailed in Note 3.1.

(a) Investments in Subsidiaries, Associates and Joint Ventures: Upon applying the equity method, the financial statements of the subsidiaries and of Prisma Medios de Pago S.A. have been consolidated. The shareholders’ equity arising from their financial statements has been adjusted by the effect the application of the IFRS-based accounting framework has had thereon.

	12.31.17		09.30.17		01.01.17
Prisma Medios de Pago S.A.		-		186,702		133,104
Ondara S.A.		-		-		(55	)
Total		-		186,702		133,049

(b) Property, Plant and Equipment: The value resulting as adjustment arises from adopting fair values as attributed cost, as described in 3.2, net of the related impact on accumulated depreciation.

(c) Intangible Assets: The prior accounting framework allowed for the inclusion in intangible assets of items such as organization and reorganization expenses, among other items, the capitalization of which is not allowed under the IFRS-based accounting framework. Such assets have been derecognized and the amortization generated under the prior accounting framework has been reversed.

(d) Fair Value Debt Securities with Changes to Income: The accounting valuation system of government and private securities set forth by the Argentine Central Bank until December 2017 established, in general, the valuation at fair value for those securities published in the list of volatilities periodically issued by such institution. The securities not included in those lists were measured at acquisition cost plus the IRR.

The adjustment disclosed is that resulting from measuring at fair value with changes in profit or loss the securities classified in this business model.

The Group has classified the following financial assets into this category: Holdings in government and private securities, in instruments issued by the Argentine Central Bank, in notes and certain investments in debt securities in financial trusts.

36

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Galicia Valores S.A. has measured at fair value with changes in profit or loss the securities classified in this business model.

(e) Derivative Instruments: Adjustment resulting from applying the techniques specified in Notes 2.1 and 4 to the Group’s option portfolio.

(f) Other Financial Assets: Upon the consolidation of the financial assets adjusted to the IFRS-based accounting framework of Financial Trust Galtrust I and Financial Trust Saturno Créditos, which are not considered controlled entities under the prior accounting framework.

(g) Loans and Other Financing Activities: According to the effective measurement criteria prior to the convergence to IFRS, these were recorded at their acquisition cost plus interest accrued based on the contractual rate. In compliance with the provisions set out in IFRS 9, the applicable adjustment has been made to the measurement at amortized cost.

(h) Other Debt Securities: As described in the preceding paragraph, the adjustment relates to debt securities of the financial trusts included in the amortized cost, business model and cash flows from the instrument.

The Financial Trust Galtrust I has adjusted the measurement of its holding of government securities at fair value with changes in other comprehensive income, since it relates to the classification within such business model for the IFRS-based accounting framework, with cash flows representing eliminations of principal plus interest.

(i) Investments in Equity Instruments: Under the IFRS-based accounting framework, interests measured at cost were reclassified to Listed Private Securities and measured at fair value.

	12.31.17		09.30.17		01.01.17
Banco de Galicia y Buenos Aires S.A.U.		54,936		43,838		40,101
Galicia Valores S.A.		-		-		31,050
Total		54,936		43,838		71,151

(j) Other Financial Assets Pledged as Collateral: The adjustment arises from the measurement at fair value with changes in profit or loss of monetary regulation instruments offered as collateral. Under the prior accounting framework, these assets were measured at cost plus IRR.

(k) Other Non-financial Assets: The adjustment is made up of the derecognition of advances for systems purchased, the capitalization of which is not allowed by the IFRS-based accounting framework, the measurement of guarantees granted according to paragraph 4.2.1. c) of IFRS 9, and the adoption of fair value as attributed cost of miscellaneous assets.

	12.31.17			09.30.17			01.01.17
Derecognition of Advances for Systems Purchased		(642,034	)		(575,278	)		(437,101	)
Miscellaneous Assets		46,261			164,557			214,906
Others		24,445			(29,502	)		-
Total		(620,218	)		(440,223	)		(222,196	)

(l) Non-current Assets Held for Sale: Relates to the adjustment of Prisma Medios de Pago S.A. due to the application of the equity method prior to its reclassification as Non-current Assets Held for Sale, as described in Note 3.5.

(m) Provisions: Relates to the adjustment for the valuation according to the likelihood criteria of IAS 37 (“more likely than not”) regarding the contingencies for labor and commercial legal actions which, according to the prior accounting framework, were recorded based on the progress made in pending labor and commercial legal actions.

(n) Other Financial Liabilities: The adjustment relates to the measurement of guarantees granted, according to paragraph 4.2.1 c) of IFRS 9, which did not require balance sheet disclosure under the prior accounting framework.

(o) Loans from the Argentine Central Bank and Other Financial Institutions: The adjustment relates to the measurement at amortized cost, according to the IFRS-based accounting framework, of those loans received, the interest on which had been accrued applying the contractual rate of the prior accounting framework.

37

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

(p) Deferred Income Tax Assets and Liabilities: The deferred tax is recognized according to the liability method, the arising temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements and is determined using tax rates (and laws) approved or about to be approved as of the balance sheet date and expected to be applicable when the related deferred tax assets are realized or the deferred tax liabilities are settled.

By applying Argentine Central Bank regulations, the Bank only recognized the current tax for the fiscal year, according to the prior accounting framework.

(q) Other Non-financial Liabilities: Relates to the deferred income for the Quiero! customer loyalty program, which is measured at the fair value of the point granted and considering the redemption rate, according to the IFRS-based accounting framework. Under the prior accounting framework, the loyalty program was measured on the basis of the cost of granted points.

(r) Liabilities Recognized by Insurance Companies: Under the IFRS-based accounting framework, an insurance company will evaluate, at the end of the period reported, the adjustment of insurance liabilities that have been recognized, using the current estimates of future cash flows from insurance contracts. If the evaluation shows that the carrying amount of its liabilities for insurance contracts (less deferred acquisition costs and related intangible assets) is not adequate, considering the estimated future cash flows, the total amount of the inadequacy will be recognized in profit or loss. Under the prior accounting framework, the accounting policies followed by the insurance company do not require performing a test of adjusting liabilities that meets the minimum conditions established by the IFRS-based accounting framework. According to IFRS 4, in this case, the insurance company shall determine the adjustment of the carrying amount recorded according to the guidelines set out in IAS 37.

NOTE 4. FINANCIAL ASSETS AND LIABILITIES

4.1.    Fair Values

The Group classifies the fair values of financial instruments in three levels, according to the quality of data used to determine them.

Fair Value Level 1: The fair value of financial instruments traded in active markets (such as, publicly-traded derivatives, notes or available for sale) is based on the quoted prices of markets (unadjusted) as of the date of the reporting period. If the quote price is available and there is an active market for the instrument, it will be included in Level 1.

Fair Value Level 2: The fair value of financial instruments that are not traded in active markets, such as the derivatives available over the counter, is determined using valuation techniques that maximize the use of observable information and relies the least possible on the Group’s specific estimates. If all the material variables to establish the fair value of a financial instrument are observable, the instrument is included in Level 2.

Fair Value Level 3: If one or more material variables are not based on observable market information, the instrument is included in Level 3. This is the case of unquoted equity instruments.

38

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The Group’s financial instruments measured at fair value at period-end are as follows:

Instruments Portfolio as of 09.30.18	Fair Value Level 1			Fair Value Level 2			Fair Value Level 3
Assets
- Argentine Central Bank’s Bills and Notes		48,759			14,423,636			-
- Government Securities		6,128,386			255,234			272,584
- Private Securities		336,845			283,176			813,955
- Derivative Instruments		-			3,832,409			-
- Other Financial Assets		2,643,544			-			39,000
- Other Debt Securities(*)		9,487,006			-			-
- Financial Assets Pledged as Collateral		1,546,172			-			-
- Equity Instruments		4,423			-			127,609
Liabilities
- Fair Value Liabilities with Changes to Income		(286,661	)		(98,370	)		-
- Derivative Instruments		-			(6,624,894	)		-
Total		19,908,474			12,071,191			1,253,148

(*) Relates to Treasury Bonds due in 2020 measured at fair value with changes in OCI.

Instruments Portfolio as of 12.31.17	Fair Value Level 1		Fair Value Level 2			Fair Value Level 3
Assets
- Argentine Central Bank’s Bills and Notes		17,268,730		590,034			-
- Government Securities		9,286,132		-			165,214
- Private Securities		559,087		4,000			1,105,043
- Derivative Instruments		-		537,000			-
- Other Financial Assets		3,058,830					39,000
- Other Debt Securities(*)		96,481		-			-
- Financial Assets Pledged as Collateral		391,287		-			-
- Equity Instruments		19,122		-			56,684
Liabilities
- Derivative Instruments		-		(584,856	)		-
Total		30,679,669		546,178			1,365,941

(*) Relates to Secured Bonds issued by Argentina measured at fair value with changes in OCI.

Changes in instruments included in fair value Level 3 are as follows:

Level 3 as of 09.30.18	Balance as of 12.31.17		Purchases		Sales			Income (Loss)		Balance as of 09.30.18
- Government Securities		165,214		2,764,571		(8,289,722	)		5,632,521		272,584
- Private Securities		1,105,043		3,822,174		(5,084,233	)		970,971		813,955
- Other Financial Assets		39,000		-		-			-		39,000
- Equity Instruments		56,684		30,167		-			-		127,609
Total		1,365,941		6,616,912		(13,373,955	)		6,644,250		1,253,148

The Group’s policy is to recognize transfers at fair value levels only as of year-end dates, there being no changes to financial instruments held in portfolio as of December 31, 2017.

Valuation Techniques

Valuation techniques to determine fair values include:

- Market or quoted prices of similar instruments.

- Determining the estimated present value of instruments.

The valuation technique to determine the fair value Level 2 is based on inputs other than the quoted price included in Level 1 that are directly observable for the asset or liability (i.e., prices). For those instruments for which there is no secondary trading and, if positions should be disposed of, the Group should sell to the Argentine Central Bank at the originally agreed-upon rate, as established by the regulatory agency, the price has been prepared based on such rate accrual.

39

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The valuation technique to determine fair value Level 3 of financial instruments is based on the price prepared by curve, which is a method that compares the existing spread between the curve of sovereign bonds and the average hurdle rates of primary issuances, representing the different segments, according to the different risk ratings. If there are no representative primary issuances during the month, the following variants will be used:

(i) secondary market prices of securities under the same conditions, which have been quoted in the month of evaluation;

(ii) prior-month bidding and/or secondary market prices will be taken depending on how representative they are;

(iii) spread calculated in the prior month and will be applied to the sovereign curve, according to the reasonableness thereof; and

(iv) a specific margin is applied, determined based on historical returns of instruments of similar conditions, based on justified reasons therefor.

As stated above, the rates and spreads to be used to discount future cash flows and originate the price of the instrument are determined.

All the changes to valuation methods are previously discussed and approved by the Group’s key personnel.

4.2.    Off-Balance Sheet Items

In the normal course of business and in order to meet customers’ financing needs, off-balance sheet transactions are performed. These instruments expose the Group to the credit risk, in addition to loans recognized in assets. These financial instruments include credit lending commitments, letters of credit reserve, guarantees granted and acceptances.

The same credit policies for agreed credits, guarantees and loan granting are used. Outstanding commitments and guarantees do not represent an unusual credit risk.

Agreed Credits

They are commitments to grant loans to a customer in a future date, subject to compliance with certain contractual agreements that usually have fixed maturity dates or other termination clauses and may require a fee payment.

Commitments are expected to expire without resorting to them. The total amounts of agreed credits do not necessarily represent future cash requirements. Each customer’s solvency is evaluated case by case.

Guarantees Granted

The issuing bank commits to reimbursing the loss to the beneficiary if the secured debtor does not comply with its obligation upon maturity.

Export and Import Documentary Credits

They are conditional commitments issued by the Group to secure a customer’s compliance towards a third party.

Responsibilities for Foreign Trade Transactions

They are conditional commitments for foreign trade transactions.

Our exposure to credit loss upon the other party’s default in the financial instrument is represented by the contractual notional amount of the same investments.

40

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The credit exposure for these transactions is detailed below.

	09.30.18		12.31.17		01.01.17
Agreed Credits		14,097,963		11,665,185		9,094,205
Export and Import Documentary Credits		1,371,345		1,358,550		650,461
Guarantees Granted		17,385,527		2,366,349		1,134,828
Responsibilities for Foreign Trade Transactions		483,411		456,567		586,180

As of September 30, 2018, December 31, 2017 and January 1, 2017, the fees and commissions related to the items mentioned above amounted to $76,547, $83,040 and $50,092 for Agreed Credits; $41,959, $40,104 and $39,820 for Export and Import Documentary Credits; and $39,445, $44,667 and $31,525 for Guarantees Granted, respectively.

The credit risk of these instruments is essentially the same as that involved in lending credit facilities to customers.

To grant guarantees to our customers, we may require counter-guarantees, which, classified by type, amount to:

	09.30.18		12.31.17		01.01.17
Other Preferred Guarantees Received		6,773,721		45,400		60,648
Other Guarantees Received		426,182		319,349		241,575

Additionally, checks to be debited and credited, as well as other elements in the collection process, such as, notes, invoices and miscellaneous items, are recorded in memorandum accounts until the related instrument is approved or accepted.

The risk of loss in these offsetting transactions is not significant.

	09.30.18		12.31.17		01.01.17
Checks and Drafts to be Debited		3,085,540		2,106,757		2,013,574
Checks and Drafts to be Credited		3,701,465		3,084,228		2,559,608
Values for Collection		23,987,395		23,037,677		18,309,418

The Group acts as trustee by virtue of trust agreements to secure obligations derived from several agreements between parties. As of September 30, 2018, December 31, 2017 and January 1, 2017, trust funds amounted to $10,539,441, $8,916,957 and $8,182,699, respectively. In addition, as of September 30, 2018, December 31, 2017 and January 1, 2017, securities held in custody amounted to $533,292,929, $374,391,939 and $258,872,060, respectively. These trusts are not included in the consolidation since the Group does not exert control on them.

4.3.    Derivative Instruments

FORWARD PURCHASE-SALE OF FOREIGN CURRENCY WITHOUT DELIVERY OF THE UNDERLYING ASSET

Mercado Abierto Electrónico (MAE) and Rosario Futures Exchange (ROFEX) have trading environments for the closing, recording and settlement of financial forward transactions carried out among its agents, the Bank being one of them. The general settlement mode for these transactions is without delivery of the traded underlying asset. Settlement is carried out on a daily basis, in Pesos, for the difference, if any, between the closing price of the underlying asset and the closing price or value of the underlying asset corresponding to the previous day, the difference in price being charged to income.

The transactions are recorded in Off-Balance Sheet Items for the notional value traded. The accrued balances pending settlement are disclosed in the “Derivative Instruments” line of Assets and/or Liabilities, as the case may be.

INTEREST RATE SWAPS

These transactions are conducted within the environment created by the MAE, and the settlement thereof is carried out on a daily or monthly basis, in Pesos, for the difference between the cash flows calculated using a variable rate (Badlar for private banks for time deposits of 30 to 35 days) and the cash flows calculated using a fixed rate, or vice versa, on the notional value agreed, the difference in price being charged to income.

41

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The amounts of transactions conducted as of the dates indicated below are as follows:

	Underlying Asset		Type of Settlement		09.30.18(*)		12.31.17(*)
Forward Purchase – Sale of Foreign Currency
Purchases		Foreign currency		Daily difference		76,617,040		20,417,503
Sales		Foreign currency		Daily difference		60,985,493		18,726,582
Purchases by Customers		Foreign currency		Daily difference		3,885,476		395,014
Sales by Customers		Foreign currency		Daily difference		16,789,441		3,706,769
Interest Rate Swaps
Swaps		Others		Other		1,000		1,000
Swaps with Customers		Others		Other		466,298		-
Repo Transactions
Forward Purchases		Government securities		With delivery of the underlying asset		-		9,697,406
Forward Sales		Government securities		With delivery of the underlying asset		14,006,042		1,132,573

(*) Notional values.

NOTE 5. EQUITY INVESTMENTS AND RELATED PARTIES

5.1.    BUSINESS COMBINATIONS

Banco Finansur S.A.’s operation was temporarily suspended by the Argentine Central Bank from November 9, 2017 to February 9, 2018. On January 12, 2018, the Bank disclosed its participation in the potential acquisition of certain assets and the assumption of secured liabilities of Banco Finansur S.A., under the framework of Section 35 bis of the Argentine Financial Institutions Law, submitting a non-binding offer to such company. In addition, on March 9, 2018, the Bank reported that the Argentine Central Bank approved the transfer of certain assets and secured liabilities of Banco Finansur S.A. in its favor, by creating a Private Financial Trust called Fidensur.

The Bank has up to 12 months from the acquisition date to complete the accounting of such transaction classified, under IFRS, as business combination. Therefore, the amounts considered below are provisional.

The amounts received are as follows:

ASSETS
Cash	24,068
Transfers to Checking Accounts with the Argentine Central Bank	215,000
Transfers Pending to Be Received Abroad	49,566
Assets Received	330
TOTAL ASSETS	288,964
LIABILITIES
Deposits	416,440
DEBT SECURITY ESTIMATED FACE VALUE	127,476

In addition, during this period, the debt security has accrued interest in the amount of $875 and interest payments have been received for $20,473, totaling $88,575 as of September 30, 2018.

5.2.       EQUITY INVESTMENTS

5.2.1.    Equity Investments in Subsidiaries

The basic information regarding the Company’s consolidated controlled companies is detailed as follows:

Company	Direct and Indirect Shareholding				Equity Investment %
	09.30.18		12.31.17		09.30.18		12.31.17
Banco de Galicia y Buenos Aires S.A.U.		668,549,353		795,973,974		100.00		100.00
Cobranzas Regionales S.A.		8,300		7,700		83.00		77.00
Galicia Administradora de Fondos S.A.		20,000		20,000		100.00		100.00
Galicia Broker Asesores de Seguros S.A.		71,310		71,310		99.99		99.99
Galicia Retiro Compañía de Seguros S.A.		7,727,271		7,727,271		99.99		99.99
Galicia Seguros S.A.		1,830,883		1,830,883		99.99		99.99
Galicia Valores S.A.		1,000,000		1,000,000		100.00		100.00
Galicia Warrants S.A.		1,000,000		1,000,000		100.00		100.00
Financial Trust Galtrust I		-		-		-		100.00

42

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Financial Trust Saturno Créditos		-		-		100.00		100.00
Net Investment S.A. (in Liquidation)(*)		-		12,000		-		100.00
Ondara S.A.		13,636,990		12,709,967		83.85		78.15
Sudamericana Holding S.A.		185,653		185,653		100.00		100.00
Tarjeta Naranja S.A.		2,343		2,174		83.00		77.00
Tarjetas Regionales S.A.		894,552,668		829,886,212		83.00		77.00
(*) The financial distribution was paid out on January 9, 2018.
Company	IFRS-based Accounting Framework (*)
	09.30.18
	Assets		Liabilities		Shareholders’       Equity		Net Income
Banco de Galicia y Buenos Aires S.A.U.		469,587,744		429,826,831		39,760,913		7,329,287
Cobranzas Regionales S.A.		114,225		70,706		43,519		8,041
Galicia Administradora de Fondos S.A.		480,102		81,851		398,251		375,707
Galicia Broker Asesores de Seguros S.A.(**)		54,159		25,326		28,832		9,007
Galicia Retiro Compañía de Seguros S.A.(**)		228,981		173,621		55,360		4,310
Galicia Seguros S.A.(**)		2,563,380		1,582,568		980,812		159,496
Galicia Valores S.A.		267,613		53,796		213,817		61,436
Galicia Warrants S.A.		139,781		29,461		110,320		39,139
Financial Trust Saturno Créditos		21,373		837		20,536		(1,421	)
Ondara S.A.		22,914		2,368		20,546		(307	)
Sudamericana Holding S.A.(**)		2,807,765		1,782,965		1,024,796		201,196
Tarjeta Naranja S.A.		45,184,548		35,793,878		9,390,670		2,139,859
Tarjetas Regionales S.A.		45,571,972		35,424,574		10,147,398		2,155,472

(*) The balances are related to consolidated accounts and arise from each subsidiary’s financial statements for publication.

(**) Net income for the three-month period ended September 30, 2018.

Company	IFRS-based Accounting Framework (*)
	12.31.17						09.30.17
	Assets		Liabilities		Shareholders’       Equity		Net Income
Banco de Galicia y Buenos Aires S.A.U.		322,336,624		281,422,839		40,913,785		5,721,424
Cobranzas Regionales S.A.		57,921		22,443		35,478		2,911
Galicia Administradora de Fondos S.A.		648,287		188,086		460,201		311,285
Galicia Broker Asesores de Seguros S.A. (**)		31,599		19,605		11,994		5,536
Galicia Retiro Compañía de Seguros S.A. (**)		195,821		155,244		40,577		1,048
Galicia Seguros S.A. (**)		1,884,259		1,149,537		734,722		87,043
Galicia Valores S.A.		175,436		23,056		152,380		36,892
Galicia Warrants S.A.		99,261		27,736		71,525		26,747
Financial Trust Galtrust I		140,994		341		140,653		56,294
Financial Trust Saturno Créditos		23,372		1,413		21,959		2,439
Net Investment S.A. (in Liquidation)(***)		283		-		283		23
Ondara S.A.		24,998		4,135		20,853		5,604
Sudamericana Holding S.A.(**)		2,538,872		1,298,879		1,239,993		108,232
Tarjeta Naranja S.A.		36,025,069		28,174,258		7,850,811		1,726,359
Tarjetas Regionales S.A.		36,613,627		28,198,701		8,414,926		1,985,895

(*) The balances are related to consolidated accounts and arise from each subsidiary’s financial statements for publication.

(**) Net income for the three-month period ended September 30, 2017.

(***) The financial distribution was paid out on January 9, 2018.

At the Company’s General Ordinary and Extraordinary Shareholders’ Meeting held on April 24, 2018, the Company authorized the amendment of Article 1 of the Bylaws, changing the corporate name from Banco de Galicia y Buenos Aires S.A. to Banco de Galicia y Buenos Aires S.A.U. The Argentine Central Bank, through Resolution No. 200 issued by its Board of Directors on July 5, 2018, did not object to such change of corporate name. On October 2, 2018, the Corporation Control Authority registered the change under Number 18709 of Book 91 of Stock Companies.

At the General Ordinary Shareholders’ Meeting of Net Investment S.A. held on May 16, 2017, the shareholders unanimously approved the early dissolution and subsequent liquidation of the company, under the provisions set out in Section 94, subsection 1, of General Corporations Law. The financial statements as of December 31, 2017 are the latest financial statements available before Net Investment S.A.’s final liquidation.

43

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The non-controlling equity investment percentages as of the dates indicated below are as follows:

Company	09.30.18		12.31.17
Cobranzas Regionales S.A.		17.00		23.00
Galicia Broker Asesores de Seguros S.A.		0.01		0.01
Galicia Retiro Compañía de Seguros S.A.		0.01		0.01
Galicia Seguros S.A.		0.01		0.01
Ondara S.A.		16.15		21.85
Tarjeta Naranja S.A.		17.00		23.00
Tarjetas Regionales S.A.		17.00		23.00

5.2.2.    Related Parties

Related parties are considered to be all those entities that directly, or indirectly through other entities, have control over another, are under the same control or may have significant influence on another entity’s financial or operational decisions.

The Group controls another entity when it has the power over other entities’ financial and operating decisions and also has a share of profits thereof.

Additionally, the Group believes that it has joint control when there is an agreement between parties regarding the control of a common economic activity.

Finally, the Group believes that it has joint control in those cases where the Group has significant influence due to its capacity to take part in decisions about the company’s financial policy and operations. Those shareholders who hold an equity investment equal to or higher than 20% of the total votes of the Group or its subsidiaries are considered to have significant influence. To determine those situations, not only are the legal aspects observed, but also the nature and substance of the relationship.

Furthermore, the key personnel of the Group’s Management (Board of Directors members and Managers of the Group and its subsidiaries), as well as the entities over which the key personnel may have significant influence or control are considered as related parties.

Controlling Entity

The Group is controlled by:

Name	Nature	Principal Line of Business	Place of Business	Equity Investment %
EBA Holding S.A.	55.11% of voting rights	Financial and Investment Activities	Autonomous City of Buenos Aires - Argentina	19.71%

Key Personnel’s Compensation

The compensation earned by the Group’s key personnel as of September 30, 2018 and December 31, 2017 amounts to $363,531 and $375,023, respectively.

Key Personnel’s Structure

Key personnel’s structure as of the dates indicated below is as follows:

	09.30.18		12.31.17
Directors		60		60
General Manager		1		1
Division Managers		11		11
Department Managers		70		66
Total		142		138

Related Party Transactions

The following table shows the total credit assistance granted by the Group to key personnel, syndics, majority shareholders, as well as all individuals who are related to them by a family relationship of up to the second degree of consanguinity or first degree by affinity (pursuant to the Argentine Central Bank’s definition of related individual) and any entity affiliated with any of these parties, not required to be consolidated.

44

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

	09.30.18		12.31.17
Total Amount of Credit Assistance		1,014,931		677,236
Number of Recipients (Amounts)		337		364
- Natural Persons		275		299
- Artificial Persons		62		65
Average Amount of Credit Assistance		3,012		1,861

Financial assistance, including the one that was restructured, was granted in the ordinary course of business, on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other non-related parties. Such financial assistance did not involve more than the normal risk of loan losses or present other unfavorable features.

NOTE 6. INFORMATION ABOUT THE SHAREHOLDERS’ EQUITY AND THE STATEMENT OF CASH FLOWS

6.1.       CAPITAL STOCK

The capital stock structure as of the dates indicated below is as follows:

	Face Value		Restated
Balances as of 01.01.17		1,300,265		1,578,396
Capital Increase		126,500		126,500
Balances as of 12.31.17		1,426,765		1,704,896
Balances as of 09.30.18		1,426,765		1,704,896

The Ordinary and Extraordinary Shareholders’ Meeting of Grupo Financiero Galicia S.A. held on August 15, 2017 decided to approve an increase in capital stock by means of the issuance of up to 150,000,000 ordinary book-entry Class “B” shares, entitled to one vote per share and with a face value of $1 each and were also entitled to dividends equal to such ordinary book-entry shares outstanding at the time of the issuance of such shares.

On September 7, 2017, the Board of Directors of the C.N.V., by means of Joint Resolution No. RESFC-2017-18927-APN-DIR#CNV, decided to authorize the public offering of 130,434,600 ordinary book-entry Class “B” shares, with a face value of $1 and one vote per share and, in case of over-subscription, an increase in such offering up to 19,565,190 ordinary book-entry Class “B” shares, with a face value of $1 and one vote each to be offered for public subscription, with preemptive and accretion rights.

The primary offering year ended on September 26, 2017, with 109,999,996 Class “B” shares having been subscribed at a price of US $5 each. On September 29, 2017, such shares were issued and paid in.

The Company granted over-subscription rights to international placement agents who, on October 2, 2017, enforced such rights and were awarded additional 16,500,004 Class “B” shares at a price of US $5 each, the issuance and payment of which took place on October 4, 2017.

The capital increase amounted to $11,004,383, the expenses related thereto amounted to $146,346 and were deducted from additional paid-in capital.

On November 8, 2017, the capital increase was registered with the Public Registry of Commerce.

6.2.       EARNINGS PER SHARE

Earnings per share are calculated by dividing income attributable to the Group’s shareholders by the weighted average of outstanding common shares during the year. As the Group does not have preferred shares or debt convertible into shares, basic earnings are equal to diluted earnings per share.

	09.30.18		09.30.17
Net Income for the Period Attributable to the Controlling Company’s Shareholders		9,999,213		5,779,580
Subscribed Shares Weighted Average		1,426,765		1,300,265
Earnings per Share		7.01		4.44

45

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

6.3.       STATEMENT OF CASH FLOWS

Cash and cash equivalents break down as follows:

	09.30.18		12.31.17		09.30.17		01.01.17
Cash and Bank Deposits		116,815,471		58,943,266		35,372,878		65,767,565
Cash and Bank Deposits from Tarjetas Regionales S.A.		-		5,730		-		-
Argentine Central Bank’s Bills and Notes Maturing within up to 90 Days		14,390,683		17,107,571		22,185,579		6,903,609
Receivables from Reverse Repo Transactions		14,087,725		9,654,517		1,907,216		-
Local Interbank Loans		1,074,000		935,000		783,000		862,300
Overnight Placements in Banks Abroad		3,869,053		288,991		5,175,436		1,227,101
Mutual Funds		2,247,253		2,427,240		2,038,054		2,192,942
Time Deposits		244,888		6,034		7,606		3,459
Government Securities		27,642		-		716,231		993,697
Total Cash and Cash Equivalents		152,756,715		89,368,349		68,186,000		77,950,673

NOTE 7. NON-FINANCIAL ASSETS

7.1.       PROPERTY, PLANT AND EQUIPMENT

Changes in Property, Plant and Equipment are detailed in Schedule F.

7.2.       INTANGIBLE ASSETS

The Group’s Intangible Assets are detailed in Schedule G.

7.3.       NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

The Group has classified the following assets as Assets Held for Sale and Discontinued Operations:

	09.30.18		12.31.17
Equity Investments		211,232		5,882,726
Prisma Medios de Pago S.A.		211,232		208,972
Compañía Financiera Argentina S.A.(*)		-		5,643,848
Cobranzas y Servicios S.A.(*)		-		29,906
Other Debt Securities		30,003		-
Financial Trust Agro IV		30,003		-
Property, Plant and Equipment		2,328		2,328
Real Estate		2,328		2,328
Total		243,563		5,885,054

(*) The amount relates to the net balance of assets and liabilities held for sale, booked under “Non-current Assets Held for Sale” and “Other Non-financial Liabilities”, respectively.

Prisma Medios de Pago S.A.: As discussed at the company’s Ordinary and Extraordinary Shareholders’ Meeting held on August 31, 2017, the shareholders authorized the transfer all of the shares of the company in a one-year term. Therefore, according to IFRS 5, this is considered as Non-current Assets Held for Sale and valued at cost or market value, whichever lower, less selling expenses, the carrying amounts of which stood at $211,232 as of September 30, 2018 (resulting from the increase in the Company’s capital stock, as determined at the General Extraordinary Shareholders’ Meeting of Prisma Medios de Pago S.A. held in April 2018), and at $208,972 as of December 31, 2017.

At the General Ordinary Shareholders’ Meeting held on May 8, 2018, the shareholders approved the distribution of cash dividends. The Bank was entitled to dividends on its equity interest in the amount of $371,515, which were charged to income for the period.

Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A.: The Bank’s Board of Directors accepted an offer to buy all treasury shares, made by Mr. Julio Alfredo Fraomeni and Galeno Capital S.A.U. In accordance with Resolution No. 414, the Argentine Central Bank authorized such transaction.

The sale of the shares in both companies was consummated on February 2, 2018, with the new holders having been registered in each of these companies’ books. The sale price was subject to the buyers’ consent, who were entitled to raise objections for a term of up to 45 consecutive days to be counted as from January 29, 2018. On March 26, 2018, the sale of shares in Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A. was completed, establishing a final price of $1,025,705 and $21,572, respectively. The proceeds from the sale of Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A. amounted to $60,207 and $14,569, respectively. The income tax impact for discontinued operations is disclosed separately in the “Income Tax from Discontinued Operations” account, which amounts to $22,882 as of September 30, 2018.

46

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

As of September 30, 2018, the Financial Trust Agro IV was classified as available for sale since the Bank agreed to an irrevocable commitment to making its best business efforts so that within one year all of its rights as Beneficiary of the trust are sold to an independent third party.

NOTE 8. OTHER DISCLOSURES REQUIRED BY IFRS

8.1.       SEGMENT REPORTING

The Group determines segments based on management reports that are reviewed by the Board of Directors and updated as they show changes.

Reportable segments are made up of one or more operating segments with similar economic characteristics, distribution channels and regulatory environments.

Below there is a description of each business segment’s composition:

a. Banks: It represents the banking business operation results.

b. Regional Credit Cards: This segment represents the results of operations of the regional credit card business and includes the results of operations of Tarjetas Regionales S.A. consolidated with its subsidiaries, as follows: Cobranzas Regionales S.A., Ondara S.A. and Tarjeta Naranja S.A.

c. Insurance: This segment represents the results of operations of the insurance companies’ business and includes the results of operations of Sudamericana Holding S.A. consolidated with its subsidiaries, as follows: Galicia Retiro Cía. de Seguros S.A., Galicia Seguros S.A. and Galicia Broker Asesores de Seguros S.A.

d. Other Businesses: This segment shows the results of operations of Galicia Administradora de Fondos S.A., Galicia Warrants S.A., Net Investment S.A. (in liquidation), Galicia Valores S.A. and Grupo Financiero Galicia S.A., the last two net of eliminations of the income from equity investments.

e. Adjustments: This segment includes consolidation adjustments and eliminations of transactions among subsidiaries.

The operating income of the Group’s different operating segments are monitored separately in order to make decisions on resource allocation and the evaluation of each segment’s performance. Segment performance is evaluated based on operating income or losses and is consistently measured with the operating income and losses of the consolidated income statement.

When any transaction occurs, the transfer pricing among operating segments is at arm’s length similarly to transactions performed with third parties. Income, expenses and income (losses) resulting from the transfers among operating segments are then eliminated from consolidation.

47

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The relevant segment reporting as of the dates indicated below is as follows:

	Banks			Regional Credit Cards			Insurance			Others			Adjustments     and/or Eliminations			Total as of 09.30.18
Net Income from Interest		14,624,458			5,724,157			281,399			19,209			7,880			20,657,103
Net Commission Income (Expense)		12,599,331			1,294,862			-			(1,011	)		(820,365	)		13,072,817
Net Income from Measurement of Fair Value Financial Instruments with Changes to Income		7,991,745			477,628			60,098			284,528			-			8,813,999
Income from Derecognition of Assets Measured at Amortized Cost		69,666			-			-			-			-			69,666
Exchange Rate Differences on Gold and Foreign Currency		1,422,069			89			5,873			75,422			-			1,503,453
Other Operating Income (Expense)		(1,210,497	)		5,993,684			80,139			575,831			(103,362	)		5,335,795
Underwriting Income		-			-			1,058,899			-			820,365			1,879,264
Loan Loss Provisions		(4,455,512	)		(2,383,742	)		-			-			-			(6,839,254	)
Employee Benefits		(6,582,094	)		(2,739,659	)		(333,172	)		(56,175	)		-			(9,711,100	)
Administrative Expenses		(6,096,455	)		(3,706,244	)		(221,694	)		(180,051	)		92,194			(10,112,250	)
Depreciation and Impairment of Assets		(587,984	)		(203,073	)		(39,001	)		(2,767	)		-			(832,825	)
Other Operating Expenses		(7,406,016	)		(1,394,975	)		(147,645	)		(42,179	)		-			(8,990,815	)
Operating Income (Loss)		10,368,711			3,062,727			744,896			672,807			(3,288	)		14,845,853
Income (Loss) for Associates and Joint Ventures		86,221			-			-			9,944,135			(10,030,356	)		-
Income before Taxes from Continuing Activities		10,454,932			3,062,727			744,896			10,616,942			(10,033,644	)		14,845,853
Income Tax from Continuing Activities		(3,176,722	)		(907,254	)		(252,201	)		(195,924	)		-			(4,532,101	)
Net Income (Loss) from Continuing Activities		7,278,210			2,155,473			492,695			10,421,018			(10,033,644	)		10,313,752
Income from Discontinued Operations		72,970			-			-			1,806			-			74,776
Income Tax from Discontinued Operations		(21,893	)		-			-			(989	)		-			(22,882	)
Net Income (Loss) for the Period		7,329,287			2,155,473			492,695			10,421,835			(10,033,644	)		10,365,646
Other Comprehensive Income (Loss)		(68,283	)		-			(11,621	)		(78,451	)		79,904			(78,451	)
Net Income (Loss) for the Period Attributable to Non-controlling Interests		(614	)		15			-			-			(365,834	)		(366,433	)
Net Income (Loss) for the Period Attributable to the Controlling Company’s Shareholders		7,260,390			2,155,488			481,074			10,343,384			(10,319,574	)		9,920,762

	Banks			Regional Credit Cards			Insurance			Others			Adjustments     and/or Eliminations			Total as of     09.30.17
Net Income from Interest		9,174,119			4,359,813			224,364			67,860	)		(66,937	)		13,759,219
Net Commission Income (Expense)		5,611,620			5,457,919			-			(521	)		(821,412	)		10,247,606
Net Income (Loss) from Measurement of Fair Value Financial Instruments with Changes to Income		3,206,522			250,646			(15,623	)		5,505			(2,439	)		3,444,611
Exchange Rate Differences on Gold and Foreign Currency		1,437,602			14,330			482			81,982			-			1,534,396
Other Operating Income (Expense)		2,245,655			586,131			29,799			598,007			(8,558	)		3,451,034
Underwriting Income		-			-			843,216			-			806,694			1,649,910
Loan Loss Provisions		(1,792,027	)		(1,524,743	)		-			(121	)		-			(3,316,891	)
Employee Benefits		(5,090,246	)		(2,273,355	)		(244,871	)		(78,035	)		-			(7,686,507	)
Administrative Expenses		(4,150,437	)		(2,609,197	)		(197,887	)		(88,282	)		20,585			(7,025,218	)
Depreciation and Impairment of Assets		(606,851	)		(148,636	)		(16,426	)		(5,341	)		-			(777,254	)
Other Operating Expenses		(4,521,641	)		(1,019,203	)		(122,087	)		(33,081	)		(1	)		(5,696,013	)
Operating Income (Loss)		5,514,316			3,093,705			500,967			547,973			(72,068	)		9,584,893
Income (Loss) for Associates and Joint Ventures		1,789,260			-			2,072			5,870,086			(7,479,978	)		181,440
Income before Taxes from Continuing Activities		7,303,576			3,093,705			503,039			6,418,059			(7,552,046	)		9,766,333
Income Tax from Continuing Activities		(1,853,607	)		(1,107,805	)		(176,980	)		(206,308	)		-			(3,344,700	)
Net Income (Loss) from Continuing Activities		5,449,969			1,985,900			326,059			6,211,751			(7,552,046	)		6,421,633
Income from Discontinued Operations		-			-			-			-			-			-
Income Tax from Discontinued Operations		(185,362	)		-			-			-			-			(185,362	)
Net Income (Loss) for the Period		5,264,607			1,985,900			326,059			6,211,751			(7,552,046	)		6,236,271
Other Comprehensive Income (Loss)		(284,841	)		-			9,142			-			(1,144	)		(276,843	)
Net Loss for the Period Attributable to Non-controlling Interests		-			(280	)		-			-			(456,411	)		(456,691	)
Net Income (Loss) for the Period Attributable to the Controlling Company’s Shareholders		4,979,766			1,985,620			335,201			6,211,751			(8,009,601	)		5,502,737

48

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

	Banks		Regional Credit Cards		Insurance		Others		Adjustments     and/or Eliminations			Total as of     09.30.18
ASSETS
Cash and Bank Deposits		116,287,010		645,514		35,644		137,432		(290,129	)		116,815,471
Fair Value Debt Securities with Changes to Income		21,883,974		749,050		174,393		226,571		(471,413	)		22,562,575
Derivative Instruments		3,832,409		-		-		-		-			3,832,409
Repo Transactions		14,145,620		-		-		-		-			14,145,620
Other Financial Assets		19,797,585		2,041,916		214,026		474,534		(24,988	)		22,503,073
Loans and Other Financing Activities		253,919,207		40,516,208		270,095		842,155		(1,607,834	)		293,939,831
Other Debt Securities		15,134,838		-		833,968		-		(103,056	)		15,865,750
Financial Assets Pledged as Collateral		9,333,293		5,176		-		-		-			9,338,469
Current Income Tax Assets		1,485,924		24,381		304,369		294,349		(170,594	)		1,938,429
Investments in Equity Instruments		130,469		-		-		1,563		-			132,032
Investments in Subsidiaries, Associates and Joint Ventures		371,364		-		-		49,691,265		(50,062,629	)		-
Property, Plant and Equipment		9,567,224		777,379		174,850		3,099		-			10,522,552
Intangible Assets		684,698		368,433		58,679		419,312		(419,307	)		1,111,815
Deferred Income Tax Assets		-		760,520		20,562		22,382		(14,745	)		788,719
Other Non-financial Assets		2,818,978		286,863		759,923		159,615		35,606			4,060,985
Non-current Assets Held for Sale		243,563		-		-		-		-			243,563
TOTAL ASSETS		469,636,156		46,175,440		2,846,509		52,272,217		(53,129,089)			517,801,233
LIABILITIES
Deposits		320,472,543		-		-		-		(420,154)			320,052,389
Fair Value Liabilities with Changes to Income		1,031,796		-		-		-		(646,765)			385,031
Derivative Instruments		6,624,894		-		-		-		-			6,624,894
Repo Transactions		-		-		-		-		-			-
Other Financial Liabilities		39,778,827		18,769,659		-		45,730		(638,355)			57,955,861
Loans from the Argentine Central Bank and Other Financial Institutions		23,636,716		2,999,254		-		-		(179,221)			26,456,749
Notes Issued		15,273,224		12,095,504		-		-		(574,469)			26,794,259
Current Income Tax Liabilities		3,818,430		341,192		418,312		227,103		(6,187)			4,798,850
Subordinated Notes		10,356,588		-		-		-		-			10,356,588
Provisions		1,292,999		57,080		74,295		57,000		-			1,481,374
Deferred Income Tax Liabilities		69,419		-		-		58,848		(14,745)			113,522
Other Non-financial Liabilities		7,521,945		1,765,353		1,262,262		50,825		17,683			10,618,068
TOTAL LIABILITIES		429,877,381		36,028,042		1,754,869		439,506		(2,462,213	)		465,637,585
	Banks		Regional Credit Cards		Insurance		Others		Adjustments and/or Eliminations			Total as of 12.31.17
ASSETS
Cash and Bank Deposits		58,460,898		536,969		23,394		67,716		(145,711)			58,943,266
Fair Value Debt Securities with Changes to Income		26,572,295		250,631		791,155		1,595,204		(231,045)			28,978,240
Derivative Instruments		525,362		-		-		11,638		-			537,000
Repo Transactions		9,676,101		-		-		-		-			9,676,101
Other Financial Assets		4,118,808		2,169,245		188,660		747,381		(166,253)			7,057,841
Loans and Other Financing Activities		160,845,605		32,364,414		9,488		88,974		(541,154)			192,767,327
Other Debt Securities		2,105,938		-		393,627		209,087		-			2,708,652
Financial Assets Pledged as Collateral		6,325,905		4,652		-		-		-			6,330,557
Current Income Tax Assets		3,392		20,473		86,021		87,474		(2,555)			194,805
Investments in Equity Instruments		75,806		-		-		-		-			75,806
Investments in Subsidiaries, Associates and Joint Ventures		6,778,282		-		-		40,502,432		(47,284,436)			-
Property, Plant and Equipment		8,973,410		669,495		143,679		3,814		-			9,790,398
Intangible Assets		599,620		249,895		56,316		30		-			905,861
Deferred Income Tax Assets		-		557,904		70		5,230		-			563,204
Other Non-financial Assets		1,814,730		192,956		679,922		189,903		(24,903)			2,852,608
Non-current Assets Held for Sale		5,715,739		-		-		169,315		-			5,885,054
TOTAL ASSETS		292,591,891		37,016,634		2,372,332		43,681,920		(48,396,057)			327,266,720
LIABILITIES
Deposits		200,884,407		-		-		-		(167,503)			200,716,904
Derivative Instruments		584,856		-		-		-		-			584,856
Repo Transactions		1,131,127		-		-		-		-			1,131,127
Other Financial Liabilities		21,230,296		16,532,609		-		2,988		(276,968)			37,488,925
Loans from the Argentine Central Bank and Other Financial Institutions		7,728,585		331,990		3,462		-		(194,989)			7,869,048
Notes Issued		4,488,602		9,481,509		-		-		(231,045)			13,739,066
Current Income Tax Liabilities		1,801,243		804,444		176,169		289,832		-			3,071,688
Subordinated Notes		4,828,018		-		-		-		-			4,828,018
Provisions		450,598		48,263		55,797		52,797		-			607,455
Deferred Income Tax Liabilities		630,211		-		-		60,832		-			691,043
Other Non-financial Liabilities		9,856,683		1,402,893		1,091,565		1,115,025		(75,939)			13,390,227
TOTAL LIABILITIES		253,614,822		28,601,708		1,326,993		1,521,474		(946,444	)		284,118,357

49

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

8.2.    LEASES

Operating Leases

The Group records contractual obligations derived from the lease of certain properties used as part of the distribution network. The estimated future lease payments related to these properties are:

Year	$
2018		502,800
2019		562,938
2020		463,989
2021		360,209
2022		282,488
2023 and Thereafter		974,310
Total		3,146,734

8.3.    PROVISIONS

Changes in the Provisions account are detailed in Schedule J.

8.4.    CONTINGENCIES

a)     Tax Issues

As of the date of these financial statements, provincial tax collection authorities, as well as tax collection authorities from the Autonomous City of Buenos Aires, are in the process (in different degrees of completion) of conducting audits and assessments with respect to the Compensatory Bond granted by the Argentine National Government to compensate financial institutions for the losses generated by the asymmetric pesification of loans and deposits.

With respect to the assessment of tax collection authorities from the Autonomous City of Buenos Aires, regarding the legal actions brought by the Bank for the purpose of challenging the assessment of the tax collection authorities, a preliminary injunction was granted by the Argentine Federal Court of Appeals in Administrative Matters for the amount corresponding to the Compensatory Bond, which was ratified by the Supreme Court of Justice. The Court ordered the AGIP (Governmental Public Revenue Authority) to refrain from starting tax enforcement proceedings or otherwise requesting precautionary measures for such purpose until a final judgment is issued.

On July 5, 2018, Division I of the Argentine Federal Court of Appeals in Administrative Matters rendered judgment upholding the defenses asserted by the Company, finding that the Compensatory Bond was exempt from turnover tax, a judgment consistent with case law from the Argentine Supreme Court of Justice in re “Banco de la Nación Argentina v. Government of the Autonomous City of Buenos Aires –AGIP DGR – Resolution No. 389/09 et. seq. over declaratory judgment action” (dated June 21, 2018). The Government of the Autonomous City of Buenos Aires also agreed to the judgment rendered in favor of the Bank, whereupon the judgment became final and all cases relating to this claim were closed.

With respect to the Autonomous City of Buenos Aires’ claims on account of other items, the Bank followed the System for the Settlement of Tax Liabilities in Arrears (Law No. 3461 and its related regulations), which envisaged the total relief of interest and fines. The Bank’s adherence to such system was communicated before the corresponding judicial authorities. Accordingly, the case argued by the Autonomous City of Buenos Aires has been closed.

In connection with the assessments made by tax collection authorities from the Province of Buenos Aires, under the framework of some of the processes under discussion at the Provincial Tax Court’s stage, the decision issued was: (i) unfavorable to the Bank’s request regarding the items not related to the Compensatory Bond, and (ii) favorable with regard to the non-taxability thereof. The Bank followed the System for the Regularization of Tax Debts (Regulatory Decision No. 12 and related decisions), which envisages discounts on the amounts not related to the Compensatory Bond. The Bank’s adherence to such system was communicated before the corresponding judicial authorities. The authorities from the Province of Buenos Aires objected to the judgment rendered by the Provincial Tax Court with regard to the Compensatory Bond, and requested that the Court of Appeals in Administrative Matters of La Plata set such decision aside. The Bank entered an appearance and filed a motion for lack of jurisdiction, as the Bank believes that only the Argentine Supreme Court of Justice has the jurisdiction to render judgment on such a matter. On April

50

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

15, 2014, the Argentine Supreme Court of Justice sustained the motion for lack of jurisdiction and ordered the proceedings to be filed. The Province of Buenos Aires filed an appeal against this judgment with the Provincial Supreme Court, which found that the case should be submitted to and heard by the Argentine Supreme Court of Justice, which held original jurisdiction over it. The Argentine Supreme Court of Justice submitted the case file to the Argentine Office of the Attorney General, which found that the Argentine Supreme Court of Justice had original jurisdiction over the matter. Following the judgment rendered by the Argentine Supreme Court of Justice on June 21, 2018 in re “Banco de la Nación Argentina v. Government of the Autonomous City of Buenos Aires –AGIP DGR – Resolution No. 389/09 et. seq. over declaratory judgment action”, the Government of the Province of Buenos Aires agreed to the judgment rendered in favor of the Bank, whereupon it became final and all cases resulting from the claim were closed. Therefore, the case related to the Compensatory Bond was closed as well.

b)     Consumer Protection Associations

Consumer Protection Associations, on behalf of consumers, have filed claims against the Bank with regard to the collection of certain financial charges.

The Group believes that the resolution of these controversies will not have a significant impact on its financial condition.

8.5.    INCOME TAX/DEFERRED TAX

The following is a reconciliation of income tax charged to income as of September 30, 2018 to that which would result from applying the tax rate in force to book income:

	09.30.18
Income for the Period Before Income Tax		14,475,745
Effective Tax Rate		30	%
Income for the Period at the Tax Rate		4,342,724
Permanent Differences at the Tax Rate
- Non-taxable Income (Loss)		(44,196)
- Donations and Other Non-deductible Expenses		30,991
- Others		148,761
- Allowance for Impairment		1,888
- Law 27430 Rate Adjustment		74,815
Total Income Tax Charge for the Period		4,554,983
	09.30.18
Current Income Tax		5,332,796
Deferred Tax Charge		(803,634)
Allowance for Impairment		1,888
Adjustment to 2017 Tax Return		23,933
Total Income Tax Charge for the Period		4,554,983

51

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The change in deferred income tax assets and liabilities, regardless of the balance offsetting within the same tax jurisdiction, is as follows:

Item	12.31.17		Charges for the Period		Expiration of Tax Loss Carry- forwards		Others		Allowance for Impairment		09.30.18
Deferred Tax Assets
Trade Receivables		554,489		208,268		-		-		-		762,757
Property, Plant and Equipment		(42,332)		(4,123)		-		257		-		(46,198)
Other Liabilities		(4,772)		239		-		(44)		-		(4,577)
Employee Benefits		1,977		2,770		-		(3,810)		-		937
Exchange Rate Differences		192		(16)		-		-		-		176
Provisions for Contingencies		45,259		15,622		-		-		-		60,881
Other Items		(5,691)		3,650		-		(69)		-		(2,110)
Financial Charges		19,067		(4,069)		-		-		-		14,998
Other Financial Assets		(40,551)		382		-		(81,513)		-		(41,682)
Equity Investments in Subsidiaries		-		(3,302)		-		3,302		-		-
Tax Loss Carry-forwards		157		6,692		(5,226)		8,391		(3,764)		6,250
Valuation of Debt Securities		7,526		(5,610)		-		824		-		2,740
Derivative Instruments		3,566		-		-		-		-		3,566
Other Assets		24,409		6,785		-		-		-		31,194
Taxes		(92)		-		-		(121)		-		(213)
Total Deferred Tax Assets		563,204		227,288		(5,226)		7,217		(3,764)		788,719

Item	12.31.17		Charges for the Period		Expiration of Tax Loss Carry- forwards		Others		Allowance for Impairment		09.30.18
Deferred Tax Liabilities
Valuation of Debt Securities		11,323		(25,738)		-		-		-		(14,415)
Loan Loss Provisions		295,458		214,723		-		-		-		510,181
Loans		112,918		49,217		-		-		-		162,135
Property, Plant and Equipment		(1,325,872)		91,202		-		(29)		-		(1,234,699)
Miscellaneous		(36,070)		(1,126)		-		-		-		(37,196)
Employee Benefits		1,668		316		-		(128)		-		1,876
Other Items		(148,684)		(159,074)		-		1,531		-		(306,227)
Other Financial Assets		(1,477)						1,477		-		-
Equity Investments in Subsidiaries		(8,452)						452		-		-
Accumulated Tax Losses		(5,226)						5,226		-		-
Assets Available for Sale		(245,702)		185,362		-		-		-		(60,340)
Intangible Assets		210,993		-		-		-		-		210,993
Other Liabilities and Provisions		432,957		221,464		-		(251)		-		654,170
Total Deferred Tax Liabilities		(698,146)		576,346		-		8,278		-		(113,522)
Deferred Tax Assets/(Liabilities)		(134,942)		803,634		(5,226)		15,495		(3,764)		675,197

A provision for the deferred tax asset was set as of September 30, 2018 and December 31, 2017 amounting to $3,765 and $7,103, respectively, as it is believed that the recovery thereof is not likely as of the date of these financial statements.

In September 2017, the Bank filed both actions for recovery of income tax paid in excess for fiscal years 2014 and 2016, totaling $433,815 and $944,338, respectively, with A.F.I.P. These actions were grounded on case law that declared unconstitutional certain rules and regulations banning the application of the inflation adjustment for tax purposes, with the ensuing confiscatory effects. As of period-end, the Bank has not recorded balances in respect of the contingent assets stemming from the aforementioned actions.

Tax Reform

On December 29, 2017, the National Executive Branch enacted Income Tax Law No. 27430. This law has introduced several changes to the previous income tax treatment. Some of the key changes involved in the reform include:

- Income Tax Rate: The income tax rate for Argentine companies shall be gradually reduced from 35% to 30% for fiscal years commencing on January 1, 2018 until December 31, 2019, and to 25% for fiscal years commencing on, and including, January 1, 2020.

- Tax on Dividends: The law has introduced a tax on dividends or profits distributed by Argentine companies or permanent establishments, among others, to: individuals, undivided interests or foreign beneficiaries, subject

52

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

to the following considerations: (i) dividends distributed out of the profits made during fiscal years commencing on January 1, 2018 until December 31, 2019 shall be subject to withholding at a 7% rate; and (ii) dividends distributed out of the profits made during fiscal years commencing on January 1, 2020 onwards shall be subject to withholding at a 13% rate.

Dividends distributed from profits earned until the fiscal year before the fiscal year that commenced on January 1, 2018 shall remain subject, in respect of all beneficiaries, to withholding at the 35% rate on the amount in excess of tax-free distributable accumulated profits (equalization tax transition period).

- Optional Tax Revaluation: Regulations establish that, at the companies’ option, the tax revaluation of assets located in the country and that are used for generating taxable income may be made. The special tax on the revaluation amount depends on the asset: 8% is for real estate that does not qualify as inventories, 15% for real estate that qualifies as inventories and 10% for personal property and the remaining assets. Once the option for a given asset is exercised, all the other assets of the same category should be revalued. Taxable income resulting from the revaluation is not subject to income tax and the special tax on the revaluation amount will not be deductible from such tax.

NOTE 9. INCOME STATEMENT BREAKDOWN

The income statement as of the dates indicated below breaks down as follows:

	Three-month Period Ended
Interest Income	09.30.18		09.30.17			09.30.18		09.30.17
On Cash and Bank Deposits		220		6			473		32
On Private Securities		60,396		137,390			191,102		437,610
On Government Securities		564,900		74,773			666,904		229,282
On Loans and Other Financing Activities		17,594,866		8,211,377			41,506,325		23,567,347
Non-financial Public Sector		-		580			1,475		4,305
Financial Sector		624,161		191,805			1,165,842		473,854
Non-financial Private Sector		16,970,705		8,018,992			40,339,008		23,089,188
Overdrafts		2,985,012		646,198			5,346,704		1,937,811
Mortgage Loans		1,349,251		147,769			2,626,753		362,941
Collateral Loans		109,424		31,764			273,295		74,421
Personal Loans		2,634,159		1,734,817			7,378,790		4,694,268
Credit Card Loans		6,147,374		3,692,204			15,979,807		11,267,660
Financial Leases		126,875		86,919			331,622		244,828
Others		3,618,610		1,679,321			8,402,037		4,507,259
On Repo Transactions		370,274		193,229			560,044		612,670
Argentine Central Bank		134,565		(116	)		237,815		(408	)
Other Financial Institutions		235,709		193,345			322,229		613,078
Total		18,590,656		8,616,775			42,924,848		24,846,941
	Three-month Period Ended
Interest Expense	09.30.18		09.30.17			09.30.18		09.30.17
On Deposits		7,812,958		2,665,434			15,856,351		7,876,267
Non-financial Private Sector		7,812,958		2,665,434			15,856,351		7,876,267
Checking Accounts		-		183			-		646
Savings Accounts		1,118		929			3,240		2,497
Time Deposit and Term Investments		6,644,200		2,411,110			14,007,742		7,557,648
Others		1,167,640		253,212			1,845,369		315,476
On Loans from the Argentine Central Bank and Other Financial Institutions		269,233		117,695			596,341		301,650
On Repo Transactions		40,055		25,983			153,290		129,120
Other Financial Institutions		40,055		25,983			153,290		129,120
On Other Financial Liabilities		1,584,944		626,101			3,368,002		1,883,612
On Notes Issued		953,074		250,895			1,875,719		640,760
On Subordinated Notes		185,656		91,895			418,042		256,313
Total		10,845,920		3,778,003			22,267,745		11,087,722

53

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

	Three-month Period Ended
Commission Income	09.30.18			09.30.17			09.30.18			09.30.17
Fees and Commissions Related to Notes		1,479,310			897,721			3,722,352			2,460,973
Fees and Commissions Related to Credits		3,575,200			2,829,778			9,979,513			8,590,253
Fees and Commissions Related to Loan Commitments and Financial Guarantees		44,016			32,442			119,364			89,775
Fees and Commissions Related to Transferable Securities		234,897			121,753			635,191			335,492
Fees and Commissions on Collection Proceedings		6,158			7,035			21,342			22,104
Fees and Commissions on Foreign and Exchange Rate Transactions		250,209			130,951			593,152			350,715
Total		5,589,790			4,019,680			15,070,914			11,849,312
	Three-month Period Ended
Commission Expense	09.30.18			09.30.17			09.30.18			09.30.17
Fees and Commissions Related to Transactions with Securities		8,044			5,807			24,194			12,511
Others		806,861			434,170			1,973,903			1,589,195
Total		814,905			439,977			1,998,097			1,601,706
Net Income from Measurement of Fair Value Financial Instruments with Changes to Income	Three-month Period Ended
	09.30.18			09.30.17			09.30.18			09.30.17
From Measurement of Financial Assets at Fair Value with Changes to Income
Income from Government Securities		2,716,230			1,047,916			5,632,521			2,970,067
Income from Private Securities		486,094			256,614			970,971			661,731
Income from Derivative Instruments		1,974,060			32,182			2,243,774			1,802
Forward Transactions		1,974,060			32,182			2,243,774			-
Options		-			-			-			1,802
Income from Other Financial Assets		47			-			45			-
From Measurement of Financial Assets at Fair Value with Changes to Income
Income (Loss) from Derivative Instruments		15,211			164,343			(33,312	)		(188,989	)
Forward Transactions		31,919			164,327			(13,108	)		(185,478	)
Rate Swaps		(16,708	)		16			(20,204	)		(26	)
Options		-			-			-			(3,485	)
Total		5,191,642			1,501,055			8,813,999			3,444,611
	Three-month Period Ended
Other Operating Income	09.30.18			09.30.17			09.30.18			09.30.17
Commission on Product Package		583,404			460,836			1,677,586			1,324,900
Other Adjustments and Interest from Miscellaneous Receivables		506,252			77,614			938,108			180,800
Rental of Safe Deposit Boxes		108,440			88,285			303,377			231,853
Other Financial Income		88,503			7,240			141,837			-
Other Income from Services		163,238			301,521			786,733			837,182
Others		448,751			297,606			1,488,154			876,299
Total		1,898,588			1,233,102			5,335,795			3,451,034
	Three-month Period Ended
Underwriting Income	09.30.18			09.30.17			09.30.18			09.30.17
Premiums and Surcharges Accrued		942,720			681,703			2,774,758			2,330,759
Claims Accrued		(117,038	)		(82,715	)		(345,325	)		(294,315	)
Surrenders		(1,804	)		(675	)		(3,094	)		(3,504	)
Life and Ordinary Annuities		(1,658	)		(1,344	)		(5,077	)		(4,128	)
Underwriting and Operating Expenses		(206,081	)		(82,394	)		(519,986	)		(370,767	)
Other Income and Expenses		10,214			10,056			(22,012	)		(8,135	)
Total		626,353			524,631			1,879,264			1,649,910

54

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

	Three-month Period Ended
Employee Benefits	09.30.18		09.30.17		09.30.18		09.30.17
Salaries		2,040,299		1,593,541		6,115,954		4,685,668
Social Security Contributions on Salaries		484,970		405,484		1,371,341		1,182,351
Severance Payments and Personnel Bonuses		659,008		515,775		1,683,713		1,434,412
Services to Personnel and Others		130,645		72,392		299,090		192,008
Other Short-term Employee Benefits		62,307		46,272		210,474		192,068
Other Long-term Employee Benefits		12,791		-		30,528		-
Total		3,390,020		2,633,464		9,711,100		7,686,507
	Three-month Period Ended
Administrative Expenses	09.30.18		09.30.17		09.30.18		09.30.17
Fees and Compensation for Services		483,982		172,997		1,056,454		408,915
Directors’ and Syndics’ Fees		30,834		21,828		110,510		73,702
Advertising, Promotion and Research Expenses		241,714		212,524		792,974		576,602
Taxes and Assessments		698,179		565,191		1,940,312		1,608,479
Maintenance and Repairs		311,901		167,531		807,935		483,671
Electricity and Communications		223,324		159,664		583,953		447,416
Entertainment and Transportation Expenses		81,005		28,419		164,419		70,473
Stationery and Office Supplies		44,747		38,879		129,484		105,203
Rentals		192,355		113,637		475,809		332,753
Administrative Services Hired		439,773		219,012		1,161,255		796,475
Security		187,427		152,690		509,277		433,943
Insurance		15,722		12,008		48,902		33,485
Others		832,021		536,660		2,330,966		1,654,101
Total		3,782,984		2,401,040		10,112,250		7,025,218
	Three-month Period Ended
Depreciation and Impairment of Assets	09.30.18		09.30.17		09.30.18		09.30.17
Depreciation of Property, Plant and Equipment		206,939		141,488		585,184		383,903
Amortization of Organization and Development Expenses		87,982		98,677		245,973		294,641
Amortization of Other Intangible Assets		-		33,627		-		96,686
Others		1,556		666		1,668		2,024
Total		296,477		274,458		832,825		777,254
	Three-month Period Ended
Other Operating Expenses	09.30.18		09.30.17		09.30.18		09.30.17
Turnover Tax		2,061,907		1,107,948		5,125,712		3,297,624
Contribution to the Guarantee Fund		108,347		68,905		282,091		201,954
Charges for Other Provisions		337,938		17,584		855,751		87,517
Claims		62,303		30,689		182,858		96,496
Other Financial Income		121,634		78,704		150,545		132,639
Other Expenses from Services		833,629		708,803		2,197,130		1,534,783
Others		84,075		108,306		196,728		345,000
Total		3,609,833		2,120,939		8,990,815		5,696,013

NOTE 10. ADDITIONAL INFORMATION REQUIRED BY THE ARGENTINE CENTRAL BANK

10.1.    CONTRIBUTION TO THE DEPOSIT INSURANCE SYSTEM

Law No. 24485 and Decree No. 540/95 established the creation of the Deposit Insurance System to cover the risk attached to bank deposits, in addition to the system of privileges and safeguards envisaged in the Financial Institutions Law.

The National Executive Branch through Decree No. 1127/98 established the maximum amount for this insurance system to demand deposits and time deposits denominated either in Pesos and/or in foreign currency. Such limit was currently set at $450.

This system does not cover deposits made by other financial institutions (including time deposit certificates acquired through a secondary transaction), deposits made by parties related to the Bank, either directly or indirectly, deposits of securities, acceptances or guarantees and those deposits set up at an interest rate exceeding the one established regularly by the Argentine Central Bank.

55

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Deposits acquired through endorsement, placements made as a result of incentives other than interest rates and locked-up balances from deposits and other excluded transactions are also excluded. This system has been implemented through the creation of the Deposit Insurance Fund (“FGD”), which is managed by a company called Seguros de Depósitos S.A. (“SEDESA”). The shareholders of SEDESA are the Argentine Central Bank and the financial institutions in the proportion determined for each one by the Argentine Central Bank based on the contributions made to the fund.

The monthly contribution institutions should make to the FGD is 0.015% on the monthly average of total deposits.

10.2.     RESTRICTED ASSETS

As of September 30, 2018, the ability to freely dispose of the following assets is restricted, as follows:

Banco de Galicia y Buenos Aires S.A.U.

a) Cash and Government Securities

	$
- For transactions carried out at RO.F.EX.		1,074,241
- For transactions carried out at Mercado Abierto Electrónico		1,333,721
- For debit / credit cards transactions		1,980,902
- For attachments		211
- Liquidity required to conduct transactions as agents at the C.N.V.		18,479
- For the contribution to the M.A.E.’s Joint Guarantee Fund (Fondo de Garantía Mancomunada)		201,311
- For other transactions		12,459

b) Special Guarantees Accounts

Special guarantee accounts have been opened at the Argentine Central Bank as collateral for transactions involving electronic clearing houses, checks for settling debts and other similar transactions, which amounted to $4,458,939.

c) Deposits in favor of the Argentine Central Bank

	$
- Unavailable deposits related to foreign exchange transactions		533

d) Equity Investments

The account “Equity Investments” includes 1,222,406 non-transferable non-endorsable registered ordinary shares in Electrigal S.A., the transfer of which is subject to approval by the national authorities, according to the terms of the previously executed concession contract.

e) Contributions to Garantizar S.G.R.’s Risk Fund

The Bank, in its capacity as sponsoring partner of Garantizar S.G.R.’s Risk Fund, is committed to maintaining the contributions made to the fund for two (2) years. As of September 30, 2018, the Bank’s contribution amounts to $190,000.

f) Guarantees Granted for Direct Obligations

	$
PROPARCO’s credit lines		86,547

g) The Bank records $253,241 for monetary regulation instruments deposited as collateral of the credit lines from the Inter-American Development Bank (IDB).

Galicia Valores S.A.

	$
- Liquidity required to conduct transactions as agents at the C.N.V.		2,821

56

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Tarjeta Naranja S.A.

	$
- Attachments in connection with lawsuits		1,803
- Guarantees related to lease agreements		5,176

Galicia Administradora de Fondos S.A.

	$
- Liquidity required to operate as agent for the management of collective investment products corresponding to mutual funds, as required by the C.N.V.		3,051

As of September 30, 2018, the total amount of restricted assets for the aforementioned items in the aforementioned controlled companies was $9,623,435, whereas as of the prior year-end and as of January 1, 2017, it was $5,724,783 and $4,734,297, respectively.

10.3.     TRUST ACTIVITIES

As of September 30, 2018, December 31, 2017 and January 1, 2017, the Group recorded participation certificates and debt securities of financial trusts held in its own portfolio at $6,301,550, $2,285,395 and $987,679, respectively.

Trusts have been excluded from consolidation, as the Bank does not have control over them, nor does the Bank have any of the following:

- power over the trust to run material activities;

- exposure or right to variable returns;

- capacity to have influence on the amount of returns to be received for the involvement.

a) Trust Contracts for Purposes of Guaranteeing Compliance with Obligations:

Purpose: In order to guarantee compliance with contractual obligations, the parties to these agreements have agreed to deliver to the Bank, as fiduciary property, amounts to be applied according to the following breakdown:

Date of Contract	Trustor	Balances of Trust Funds				Maturity Date(1)
		$		US$
12.07.10	Fondo Fiduciario Aceitero		235		-	12.31.18
04.17.12	Exxon Mobil		5,549		-	04.19.19
04.29.13	Profertil		820		116,500	12.31.18
09.12.14	Coop. de Trab. Portuarios		1,098		-	09.12.20
04.14.16	Rios Belt		202		-	04.14.19
06.22.17	SACDE		3		-	06.22.20
05.24.17	MSU		166		-	07.29.20
06.28.17	Dist. Gas del Centro		255		-	12.31.18
07.19.17	Dist. Gas Cuyana		544		-	12.31.18
08.08.17	Dist. Gas del Centro		471		-	12.31.18
	Total		9,343		116,500

(1) These amounts shall be released monthly until settlement date of trustor obligations or maturity date, whichever occurs first.

b) Financial Trust Contracts:

Purpose: To administer and exercise the fiduciary ownership of the trust assets until the redemption of debt securities and participation certificates:

57

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Date of Contract	Trust	Balances of Trust     Funds		Maturity  Date(2)
12.06.06	Gas I		59,730		12.31.18
05.14.09	Gas II		5,133,877		12.31.22
02.10.11	Cag S.A.		427		12.31.18
06.08.11	Mila III		7,365		12.31.18
09.01.11	Mila IV		936		12.31.18
09.14.11	Cag S.A. II		644		12.31.18
09.18.13	Don Mario Semillas Series I		75		12.31.18
02.13.14	Mila V		957		05.20.20
06.06.14	Mila VI		379		10.20.20
06.18.14	Red Surcos II		1,354		12.31.18
10.03.14	Mila VII		1,063		01.20.21
01.13.15	Red Surcos III		766		12.31.18
01.27.15	Mila VIII		4,315		06.15.21
05.18.15	Mila IX		4,473		09.15.21
08.24.15	Mila X		6,573		12.20.21
10.30.15	Mila XI		8,939		01.15.22
01.14.16	Mila XII		12,332		11.15.21
02.05.16	Red Surcos IV		905		12.31.18
05.13.16	Mila XIII		19,714		09.15.22
06.15.16	Mas Cuotas Series IV		39		12.31.18
09.01.16	Mila XIV		23,093		01.31.23
09.15.16	Mas Cuotas Series V		1,028		12.31.18
10.27.16	Mila XV		34,143		03.31.23
12.06.16	Mas Cuotas Series VI		105		12.31.18
01.10.17	Mila XVI		41,581		06.30.23
02.24.17	Mila XVII		65,348		09.30.23
03.23.17	Mas Cuotas Series VII		1,089		12.31.18
05.29.17	Fedeicred Agro Series IV		140		12.31.18
06.12.17	Mila XVIII		76,609		01.31.24
06.21.17	Mas Cuotas Series VIII		935		12.31.18
08.16.17	Mas Cuotas Series IX		430		12.31.18
10.20.17	Mas Cuotas Series X		5,574		10.15.18
10.27.17	Mila XIX		144,729		05.31.24
02.16.18	Mila XX		105,965		09.30.24
	Totals		5,765,632

(2) Estimated date, since maturity date shall occur at the time of the distribution of all of trust assets.

c) Activities as Security Agent:

c.1) The Bank has been appointed Security Agent of the National Treasury’s endorsement guarantees in favor of ENARSA (Energía Argentina S.A.) that were assigned in favor of Nación Fideicomisos S.A. in its capacity as Trustee of the “ENARSA-BARRAGAN” and “ENARSA-BRIGADIER LOPEZ” financial trusts.

Said endorsement guarantees the secure payment of all obligations arising from the above-mentioned trusts.

The Bank, in its capacity as Security Agent, will take custody of the documents regarding the Argentine National Treasury’s endorsement guarantees and will be in charge of managing all legal and notarial proceedings with respect to the enforcement thereof.

As of September 30, 2018, December 31, 2017 and January 1, 2017, the balances recorded from these transactions amount to US $1,364,097 and $408, respectively.

c.2) In April 2013, at the time of entering into the Contract for the Fiduciary Assignment and Trust for Guarantee Purposes “Profertil S.A.”, the Bank was appointed security agent with regard to the Chattel Mortgage Agreement, a transaction that was completed on June 18, 2013, which additionally secures all the obligations undertaken.

As of September 30, 2018, December 31, 2017 and January 1, 2017, the balances recorded from these transactions amount to US $116,500.

All the transactions detailed above are recorded in off-balance sheet items - trust funds.

d) Setting Up of Financial Trusts

58

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

10.4. COMPLIANCE WITH THE REGULATIONS REQUIRED BY THE C.N.V.

10.4.1. Agents – Minimum Liquidity Requirement

Within the framework of Resolution No. 622/13 of the C.N.V., the Bank has been registered, in such agency’s registry, as settlement and clearing agent –comprehensive– No. 22 (ALyC and AN – INTEGRAL), custodial agent of collective investment products corresponding to mutual funds No. 3 (ACPIC FCI), and manager of collective investment products at the registry of financial trustees No. 54.

As of December 31, 2017, the Bank’s Shareholders’ Equity exceeds that required by the C.N.V. to act as agent in the categories in which the Bank has been registered. Such requirement amounts to $28,000 with a minimum liquidity requirement of $14,000, which the Bank paid with Argentine Central Bank’s monetary regulation instruments, which are held in custody at Caja de Valores (Depositor No. 100100) in the amount of $18,479.

Additionally, Galicia Valores S.A. has received the authorization to act as “Settlement and Clearing Agent and Trading Agent – Own”, as established by C.N.V.’s General Resolution No. 622/13. According to the minimum requirements established, the minimum shareholders’ equity required to act in this agent’s category amounts to $3,500 and the minimum liquidity amounts to $1,750.

As of September 30, 2018, the minimum liquidity is made up of a sight account opened at the Bank in the amount of US $70.

10.4.2.     Custodial Agent of Collective Investment Products Corresponding to Mutual Funds

In compliance with Section 7 of Chapter II, Title V of the Resolution mentioned above, in its capacity as custodial agent of collective investment products corresponding to mutual funds (depository) of the “FIMA ACCIONES”,“FIMA P.B. ACCIONES”, “FIMA RENTA EN PESOS”,“FIMA AHORRO PESOS”,“FIMA RENTA PLUS”, “FIMA PREMIUM”, “FIMA AHORRO PLUS”, “FIMA CAPITAL PLUS”, “FIMA ABIERTO PYMES”, “FIMA MIX I”, “FIMA RENTA DÓLARES I” and “FIMA RENTA DOLARES II” funds, as of September 30, 2018, the Bank holds a total of 9,631,903,301 units under custody for a market value of $ 58,066,481, which is included in the “Depositors of Securities Held in Custody” account. As of previous fiscal year-end and January 1, 2017, the securities held in custody totaled 10,254,289,765 and 7,777,368,861 units and their market value amounted to $67,972,574 and $37,337,855, respectively.

The balances of the Mutual Funds as of the dates indicated below are detailed as follows:

Mutual Fund	09.30.18		12.31.17		01.01.17
FIMA Acciones		462,589		412,803		117,805
FIMA P.B. Acciones		1,141,136		1,143,324		305,310
FIMA Renta en pesos		345,862		525,826		239,066
FIMA Ahorro pesos		7,154,284		20,823,171		15,955,347
FIMA Renta Plus		166,399		369,949		247,293
FIMA Premium		29,671,212		10,098,362		7,130,327
FIMA Ahorro Plus		4,690,365		17,238,677		10,194,730
FIMA Capital Plus		241,672		379,178		561,800
FIMA Abierto PyMES		328,739		264,206		187,124
FIMA Mix I		10,352		164,890		151,487
FIMA Renta Dólares I (*)		10,808,830		12,384,341		2,245,266
FIMA Renta Dólares II (*)		3,045,041		4,167,847		2,300
Total		58,066,481		67,972,574		37,337,855

(*) Stated at the reference exchange rate of the U.S. dollar set by the Argentine Central Bank. See Note 1.7.(b).

All the transactions detailed above are recorded in off-balance sheet items - securities held in custody.

The mutual funds detailed above have not been consolidated as the Group is not a controlling company thereof, since the depository role does not imply in this case, as outlined below:

- power over the trust to run material activities;

- exposure or right to variable returns;

- capacity to have influence on the amount of returns to be received for the involvement.

59

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

10.4.3.     Storage of Documents

Pursuant to General Resolution No. 629 of the C.N.V., the Bank notes that it has supporting documents regarding accounting and management transactions, which are stored at AdeA (C.U.I.T. No. 30-68233570-6), Plant III located at Ruta Provincial 36 km 31.5 No. 6471 (CP 1888) Bosques, Province of Buenos Aires, with legal domicile at Av. Pte. Roque Sáenz Peña 832, 1st. floor, Autonomous City of Buenos Aires.

10.5.     ACCOUNTS SHOWING COMPLIANCE WITH MINIMUM CASH REQUIREMENTS:

As of September 30, 2018, the balances recorded as computable items are as follows:

Item	$		US$			Euros(*)
Checking Accounts at the Argentine Central Bank		22,600,000		1,691,314	(1)		16	(3)
Special Guarantees Accounts at the Argentine Central Bank		4,121,675		9,200	(2)		-
Total Computable Items to Meet Minimum Cash Requirements		26,721,675		1,700,514			16

(*) Stated in thousands of US$.

(1) Equivalent to $69,169,161

(2) Equivalent to $376,250

(3) Equivalent to $760

10.6. PENALTIES IMPOSED ON BANCO DE GALICIA Y BUENOS AIRES S.A.U. AND SUMMARY PROCEEDINGS COMMENCED BY THE ARGENTINE CENTRAL BANK

Penalties Imposed on Banco de Galicia y Buenos Aires S.A.U. Existing as of September 30, 2018:

U.I.F.’s Summary Proceedings No. 68/09. Penalty notification date: February 25, 2010. Reason for the imposition of the penalty: Alleged omission to report suspicious activities, in possible infringement of Act No. 25246. As a consequence of the aforementioned summary proceedings, the Bank, one of its directors and one of its officers were punished with a fine in the amount of $4,483. Status of the proceedings: Division I of the Argentine Federal Court of Appeals in Administrative Matters partially revoked the penalties, releasing Eduardo A. Fanciulli from any liability and reducing the fines imposed. The U.I.F., the Bank and Mr. Enrique M. Garda Olaciregui filed federal extraordinary appeals before the CSJN. Accounting treatment: As of September 30, 2018, a provision for $5,306 is recorded, whereas a provision for $4,983 and $5,500 was recorded as of December 31, 2017 and January 1, 2017, respectively.

Penalties Imposed on Banco de Galicia y Buenos Aires S.A.U., notice of which was served upon the Bank subsequent to September 30, 2018:

Summary Proceedings No. 1544. Penalty notification date: November 9, 2018. Reason for the imposition of the penalty: Alleged breach of the provisions set out in Argentine Central Bank’s Communiqué “A” 6242, SINAP 1—61. As a consequence of the aforementioned summary proceedings, the Bank, three of its directors and certain relevant officers were punished with a fine in the amount of $1,497. Status of the proceedings: The Bank will file an appeal against the penalty with the Argentine Federal Court of Appeals in Administrative Matters of the Autonomous City of Buenos Aires, under the terms of section 42 of Law No. 21,526, as amended by Law No. 24,144.

Summary Proceedings Commenced by the Argentine Central Bank (with no Penalties) Pending as of September 30, 2018:

Summary Proceedings No. 1544. Notification date: March 6, 2018. Charges filed: Alleged breach of the provisions set out in Argentine Central Bank’s Communiqué “A” 6242, SINAP 1 - 61. Individuals subject to summary proceedings: The Bank and certain relevant officers. Status of the proceedings: A defense was filed with the Argentine Central Bank, which is being analyzed by such entity’s Management Division of Financial Litigation Matters.

60

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

10.7. ISSUANCE OF NOTES

The following is a breakdown of the Global Programs for the Issuance of Notes outstanding:

Company	Authorized       Amount(*)	Type of Notes	Term of     Program	Date of Approval by   Shareholders’   Meeting	Approval by the C.N.V.
Grupo Financiero Galicia S.A.	US$ 100,000	Simple notes, not convertible into shares	5 years	03.09.09 confirmed on 08.02.12	Resolution No. 16113 dated 04.29.09 and extended through Resolution No. 17343 dated 05.08.14. Authorization of the increase, Resolution No. 17064 dated 04.25.13.
Banco de Galicia y Buenos Aires S.A.U.	US$ 2,100,000	Simple notes, not convertible into shares, subordinated or not, to be adjusted or not, secured or unsecured.	5 years	04.28.05, 04.14.10, 04.29.15 and 11.09.16	Resolution No. 15228 dated 11.04.05 and extended through Resolution No. 16454 dated 11.11.10 and Resolution No. 17883 dated 11.20.15. Increase of the amount approved by Resolutions No. 17883 dated 11.20.15, No. 18081 dated 06.10.16, No. 18480 dated 01.26.17 and No. 19520 dated 05.17.18.
Tarjeta Naranja S.A.	US$ 650,000	Simple notes, not convertible into shares	5 years	03.08.12	Resolution No. 16822 dated 05.23.12 and extended through Resolution No. 17676 dated 05.21.15.
Tarjetas Cuyanas S.A.	US$ 250,000	Simple notes, not convertible into shares	5 years	03.30.10 confirmed on 04.06.10 and 02.15.13	Resolution No. 16328 dated 05.18.10. Authorization of the increase, Resolution No. 17072 dated 05.02.13.

(*) Or its equivalent in any other currency.

The Company has the following Unsubordinated Notes outstanding issued under the Global Programs detailed in the table above as of the close of the period/fiscal year, net of repurchases of Own Notes:

61

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Company	Date of Placement	Currency	Class No.	Face Value	Type(**)	Term	Maturity Date	Rate	Carrying Amount(*)				Issuance
									09.30.18		12.31.17		Authorized     by the C.N.V.
Banco de Galicia y Bs. As. S.A.U.	02.17.17	$	-	US$ 150,537(1)	Simple	36 Months	-	(1)(3)		2,378,797		2,431,324	02.06.17
Banco de Galicia y Bs. As. S.A.U.	05.18.17	$	-	$2,000,000	Simple	36 Months	-	(2)(4)		2,049,471		2,057,278	05.08.17
Banco de Galicia y Bs. As. S.A.U.	04.26.18	$	-	$4,209,250	Simple	24 Months	-	(5)		4,579,937		_	04.18.17
Banco de Galicia y Bs. As. S.A.U.	04.26.18	$	-	$2,032,833	Simple	36 Months	-	(6)		2,144,792		_	04.18.17
Tarjeta Naranja S.A.	04.13.16	$	XXXIII Series II	$366,908	Simple	1,095 days	04.13.19	Minimum 37% Rate/ Badlar +5.40%		401,540		374,489	03.28.16
Tarjeta Naranja S.A.	06.29.16	$	XXXIV Series II	$475,397	Simple	1,461 days	06.29.20	Minimum 32% Rate/ Badlar +4.67%		523,933		472,171	06.21.16
Tarjeta Naranja S.A.	09.27.16	$	XXXV Series I	$225,611	Simple	546 days	03.27.18	Minimum 26% Rate/ Badlar +2.99%		_		227,175	09.15.16
Tarjeta Naranja S.A.	09.27.16	$	XXXV Series II	$774,389	Simple	1,461 days	09.27.20	Minimum 26% Rate/ Badlar +3.99%		700,727		757,099	09.15.16
Tarjeta Naranja S.A.	12.07.16	$	XXXVI Series I	$210,571	Simple	547 days	06.07.18	Minimum 25.25% Rate/ Badlar + 3.25%		_		212,651	11.23.16
Tarjeta Naranja S.A.	12.07.16	$	XXXVI Series II	$636,409	Simple	1,095 days	12.07.19	Minimum 25.25% Rate/ Badlar + 4.00%		642,609		625,125	11.23.16
Tarjeta Naranja S.A.	04.11.17	$	XXXVII	$3,845,700	Simple	1,826 days	04.11.22	Minimum 15% Rate/ Badlar + 3.50%		4,063,318		4,023,299	03.30.17
Tarjeta Naranja S.A.	11.13.17	$	XXXVIII	$503,333	Simple	546 days	05.13.19	Minimum 29.05% Rate/ MR20 + 4%		519,046		516,616	11.07.17
Tarjeta Naranja S.A.	02.14.18	$	XXXIX	$754,538	Simple	546 days	09.14.19	Minimum 26.75% Rate/MR 20 +3.4%		718,759		_	02.02.18
Tarjeta Naranja S.A.		$	XL Series I	$597,500	Simple	548 days	10.10.19	25.98% Fixed Rate		667,145		_	03.27.18

(*) It includes principal and interest.

(**) Not convertible into shares.

(1) As specified in the terms and conditions of the issuance, they were converted to $2,360,360. Investor assumes the exchange rate risk since the service of interest and principal is calculated on the basis of the principal amount in Pesos converted into US Dollars on each payment date.

(2) The net proceeds from this issuance of notes was applied to investments in working capital, other loans and other uses envisaged by the provisions of the Law on Notes and the Argentine Central Bank regulations.

(3) Variable rate equal to the simple arithmetic average of private Badlar, plus 2.69%, which will be payable quarterly as from May 17, 2017.

(4) Variable rate equal to the simple arithmetic average of private Badlar, plus 2.98%, which will be payable quarterly as from August 18, 2017.

(5) Annual nominal fixed 25.98% rate; principal and interest will be settled in full upon maturity.

(6) Variable rate equal to the simple arithmetic average of private Badlar, plus 3.5%, which will be payable quarterly as from July 26, 2018. Principal in respect of this Series will be repaid upon maturity.

62

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Company	Date of Placement		Currency		Class No.		Face Value		Type(**)		Term		Maturity Date		Rate		Carrying Amount(*)			Issuance Authorized by the C.N.V.
Tarjeta Naranja S.A.				$		XL Series II		$1,402,500		Simple		914 days		10.10.20		Minimum 27% Rate/Badlar + 3.69%		1,441,276	-		03.27.18
Tarjeta Naranja S.A. (***)		05.05.16		$		XXIV Series II		$234,309		Simple		1,095 days		05.05.19		Minimum 37% Rate/Badlar + 4.98%		201,885	207,246		04.22.16
Tarjeta Naranja S.A. (***)		07.26.16				$XXV		$400,000		Simple		1,461 days		07.26.20		Minimum 30% Rate/Badlar + 3.94%		368,797	419,518		07.13.16
Tarjeta Naranja S.A. (***)		10.24.16		$		XXVI Series I		$149,763		Simple		547 days		04.24.18		Minimum 26% Rate/Badlar + 2.75%		-	156,939		10.14.16
Tarjeta Naranja S.A. (***)		10.24.16		$		XXVI Series II		$350,237		Simple		1,461 days		10.24.20		Minimum 26% Rate/Badlar + 4.00%		351,156	303,388		10.14.16
Tarjeta Naranja S.A. (***)		02.10.17		$		XXVII Series II		$500,000		Simple		1,095 days		02.10.20		Minimum 23.5% Rate/Badlar + 3.50%		491,206	515,806		02.02.17
Tarjeta Naranja S.A. (***)		06.09.17		$		XXVIII Series I		$128,175		Simple		730 days		06.09.19		Minimum 25% Rate/Badlar + 3.05%		131,489	129,167		05.29.17
Tarjeta Naranja S.A. (***)		06.09.17		$		XXVIII Series II		$371,825		Simple		1,461 days		06.09.21		Minimum 25% Rate/Badlar + 3.70%		303,711	309,775		05.29.17
Total																		22,679,594	13,739,066

(*) It includes principal and interest.

(**) Not convertible into shares.

(***) Notes merged into by Tarjeta Naranja S.A. following its merger with Tarjetas Cuyanas S.A.

On September 21, 2018, the Bank issued the “Green Bond” which was entirely acquired by the International Finance Corporation. The Green Bond is a 7-year facility, with interest payable every six months. The Green Bond has a 36-month grace period in respect of the repayment of principal, followed by nine installment payments, due every six months. As of September 30, 2018, the carrying amount of the Green Bond amounts to $4,114,665.

Additionally, as of period/year-end, the following issuances of Subordinated Notes issued are outstanding:

Company	Date of Placement		Currency	Class No.		Face Value		Type(**)		Term			Maturity Date		Rate			Carrying Amount(*)				Issuance Authorized by the C.N.V.
																		09.30.18		12.31.17
Banco de Galicia y Bs. As. S.A.U.		07.19.16	US$		-	US$	250,000		Subordinated		120 months	(1)		-		(2	)(3)		10,356,588		4,828,018		06.23.16

(*) It includes principal and interest.

(**) Not convertible into shares.

(1) Amortization shall be fully made upon maturity, on July 19, 2026, unless redeemed, at the issuer’s option, fully at a price equal to 100% of the outstanding principal plus accrued and unpaid interest.

(2) Fixed 8.25% rate p.a. (as from the issuance date to July 19, 2021, inclusively); and margin to be added to the nominal Benchmark Readjustment Rate of 7.156% p.a. to the due date of Notes. Such interest shall be payable semiannually on January 19 and July 19 as from 2017.

(3) The net proceeds from this issuance of notes was applied to investments in working capital, other loans and other uses envisaged by the provisions of the Law on Notes and the Argentine Central Bank regulations.

63

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The repurchases of Own Notes as of the indicated dates are as follows:

		Face Value				Carrying Amount(*)
Company	NO Class	09.30.18		12.31.17		09.30.18		12.31.17
Banco de Galicia y Buenos Aires S.A.U.	Class III	U$	S 5,875	US$	830		96,964		4,648
Banco de Galicia y Buenos Aires S.A.U.	Class IV		50,555		-		53,177		-
Banco de Galicia y Buenos Aires S.A.U.	Class V – Series I		82,500		-		91,778		-
Banco de Galicia y Buenos Aires S.A.U.	Class V – Series II		41,250		-		44,606		-
Tarjeta Naranja S.A.	Class XXXIII Series II		-		13,231		-		14,514
Tarjeta Naranja S.A.	Class XXXIV Series II		-		2,111		-		2,154
Tarjeta Naranja S.A.	Class XXXV Series II		78,500		-		74,797		-
Tarjeta Naranja S.A.	Class XXXVI Series I		-		2,000		-		2,026
Tarjeta Naranja S.A.	Class XXXVI Series II		10,000		10,000		11,571		10,166
Tarjeta Naranja S.A.	Class XXXVII		5,065		-		73,792		-
Tarjeta Naranja S.A.	Class XXXVIII		12,000		-		12,686		-
Tarjeta Naranja S.A.	Class XXXIX		73,550		-		75,051		-
Tarjeta Naranja S.A.	Class XL Series I		1,000		-		864		-
Tarjeta Naranja S.A.	Class XL Series II		89,000		-		72,094		-
Tarjeta Naranja S.A.(**)	Class XXIV Series II		30,000		35,000		48,472		37,225
Tarjeta Naranja S.A.(**)	Class XXV Series II		62,000		-		60,714		-
Tarjeta Naranja S.A.(**)	Class XXVI Series II		23,000		50,540		25,385		53,565
Tarjeta Naranja S.A.(**)	Class XXVII Series II		37,871		-		37,332		-
Tarjeta Naranja S.A.(**)	Class XXVIII Series II		78,707		58,405		76,150		59,713
							855,433		184,011

(*) It includes principal and interest.

(**) Notes merged into by Tarjeta Naranja S.A. following its merger with Tarjetas Cuyanas S.A.

10.8. RESTRICTIONS IMPOSED ON THE DISTRIBUTION OF PROFITS

Pursuant to Section 70 of the General Corporations Law, the Company should transfer 5% of the net income for the year to the Legal Reserve until 20% of the capital stock is reached, plus the balance of the Capital Adjustment account.

The Argentine Central Bank regulations require that 20% of the profits shown in the Income Statement at fiscal year-end, plus (or less), the adjustments made in previous fiscal years and, less, if any, the loss accumulated at previous fiscal year-end, be allocated to the legal reserve.

This proportion applies regardless of the ratio of the Legal Reserve fund to Capital Stock. Should the Legal Reserve be used to absorb losses, earnings shall be distributed only if the value of the Legal Reserve reaches 20% of the Capital Stock plus the Capital Adjustment.

The Argentine Central Bank sets rules for the conditions under which financial institutions can make distributions of profits. According to these rules, profits can be distributed as long as results of operations are positive after deducting not only the Reserves, which may be legally and statutory required, but also the following items from Retained Income: The difference between the carrying amount and the market value of public sector assets and/or debt instruments issued by the Argentine Central Bank not valued at market price, the amounts capitalized for lawsuits related to deposits and any unrecorded adjustments required by the external auditors or the Argentine Central Bank.

Moreover, in order that a financial institution be able to distribute profits, said institution must comply with the capital adequacy rule, i.e. with the calculation of minimum capital requirements and the regulatory capital.

For these purposes, this shall be done by deducting from its assets and Retained Income all the items mentioned in the paragraph above. Moreover, in such calculation, a financial institution shall not be able to compute the temporary reductions that affect minimum capital requirements, computable regulatory capital or its capital adequacy.

Since January 2016, the Argentine Central Bank determined that banks shall meet an additional capital conservation buffer apart from the minimum capital requirement equal to 3.5% of risk-weighted assets. This shall be made up only of Tier 1 Common Capital, net of deductible items. Distribution of profits shall be restricted when the Bank’s computable regulatory capital level and structure is within the range of the capital conservation buffer.

The prior authorization of the Argentine Regulatory Agency of Financial and Foreign Exchange Institutions (SEFyC, as per its initials in Spanish) shall not be required for the distribution of profits, except in the cases where a financial institution is within the capital conservation buffer and to determine distributable profits the Tier 1 common capital range had not been increased by 1 percentage point, net of deductible items. Such restriction was established until March 31, 2020.

64

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Tarjeta Naranja S.A.’s Ordinary and Extraordinary Shareholders’ Meeting held on March 16, 2006 authorized the establishment of a maximum limit for the distribution of dividends at 25% of the realized and liquid profits of each fiscal year. This restriction shall remain in force as long as the company’s Shareholders’ Equity is below $300,000.

Pursuant to the Pricing Supplement of the Class XXXVII Notes, Tarjeta Naranja S.A. has agreed not to distribute dividends that may exceed 50% of the company’s net income. This restriction also applies in the event of any excess over certain indebtedness ratios.

Notwithstanding the aforementioned, profits resulting from the first-time application of IFRS may not be distributed. Instead, such profits, if any, will be appropriated to a special reserve recorded under equity, which may be released for capitalization purposes or to offset potential losses.

10.9. CAPITAL MANAGEMENT AND CORPORATE GOVERNANCE TRANSPARENCY POLICY

Grupo Financiero Galicia S.A.

The Company’s Board of Directors is the highest management body of the Company. It is made up of nine directors and three alternate directors, who must have the necessary knowledge and skills to clearly understand their responsibilities and duties within the corporate governance, and to act with the loyalty and diligence of a good businessman.

As set out in its bylaws, the term of office for both directors and alternate directors is three (3) years; they are partially changed every year and may be reelected indefinitely.

The Company complies with the appropriate standards regarding total number of directors, as well as the number of independent directors. Furthermore, its bylaws provide for the flexibility necessary to adapt the number of directors to the possible changes in the conditions in which the Company carries out its activities, from three (3) to nine (9) directors.

The Board of Directors complies, in every relevant respect, with the recommendations included in the Code on Corporate Governance as Schedule IV to Title IV of the regulations issued by the National Securities Commission (Text amended in 2013).

It also monitors the application of the corporate governance policies provided for by the regulations in force through the Audit Committee and the Committee for Information Integrity. Periodically, the Committees provide the Board of Directors with information, and the Board gets to know the decisions of each Committee. What is appropriate is transcribed in the minutes drafted at the Board of Directors’ meetings.

The Audit Committee set by Capital Markets Law No. 26831 and the C.N.V.’s regulations is formed by three independent directors, and the Committee for Information Integrity’s mission is to comply with the provisions of U.S. Sarbanes-Oxley Act.

Corporate risk management is monitored by the Audit Committee, which also gathers and analyzes the information submitted by the main controlled companies.

Basic Holding Structure

Grupo Financiero Galicia S.A. is a company whose sole purpose is to conduct financial and investment activities as per Section 31 of the Argentine General Corporations Law. That is to say, it is a holding company whose activity involves managing its equity investments, assets and resources.

Within the group of companies in which the Company has an interest, the Bank stands out, in which the Company has a controlling equity interest, being its main asset as well. The Bank, as a bank institution, is subject to certain regulatory restrictions imposed by the Argentine Central Bank. In particular, the Bank can only hold a 12.5% interest in the capital stock of companies that do not carry out activities considered supplementary by the Argentine Central Bank.

Therefore, the Company holds, either directly or indirectly, the remaining interests in several companies. In addition, the Company indirectly holds a number of equity investments in supplementary companies that belong to the Bank as the controlling company.

65

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

Since the Company is a holding company, it has a limited personnel structure, and, therefore, many of the business organization requirements, common for big productive institutions, cannot be applied to this company.

To conclude, it is noteworthy that the Company is under the control of a pure holding company, EBA Holding S.A., which holds a majority of outstanding votes at the Shareholders’ Meetings, although it does not have any managerial functions over the Company and the Company has no group relationship with EBA Holding S.A.

Compensation Systems

Directors’ compensation is defined by the General Shareholders’ Meeting and is fixed within the limits established by law and the corporate bylaws.

The Audit Committee expresses its opinion on whether compensation proposals for Directors are reasonable, taking into consideration market standards.

Business Conduct Policy

The Company has consistently shown respect for the rights of its shareholders, reliability and accuracy in the information provided, transparency as to its policies and decisions, and caution with regard to the disclosure of strategic business issues.

Code of Ethics

The Company has a formally approved Code of Ethics that guides its policies and activities. It considers business objectivity and conflict-of-interests related-aspects, and how the employee should act upon identifying a breach of the Code of Ethics.

Executive Committee

In July 2018, the Company’s Board of Directors approved the creation of an Executive Committee, along with its governing rules and regulations. The Executive Committee will contribute to the Company’s ordinary business activities, giving support to the efficient performance of the Board of Directors’ duties.

Banco de Galicia y Buenos Aires S.A.U.

The Bank’s Board of Directors is its highest management body. As of the date of preparation of these consolidated condensed interim financial statements, it is currently made up of seven (7) directors and four (4) alternate directors, who have the necessary knowledge and skills to clearly understand their responsibilities and duties within the corporate governance, and act with the loyalty and diligence of a good businessman.

The Bank complies with the appropriate standards regarding total number of directors, as well as number of independent directors. Furthermore, its bylaws provide for the flexibility necessary to adapt from three (3) to nine (9) directors to the possible changes in the conditions in which the Bank carries out its activities.

The General Shareholders’ Meeting has the power to establish the number of directors, both independent and non-independent ones, and appoint them. Out of the seven directors, one of them is independent. In addition, two of the alternate directors are independent. The independence concept is defined in the regulations set forth by the C.N.V. and the Argentine Central Bank regulations.

As regards prevention of conflicts of interest, the provisions set forth in the General Corporations Law and the Capital Markets Law are applicable.

As set out in the bylaws, the term of office for both directors and alternate directors is three (3) years; two thirds of them (or a fraction of at least three) are changed every year and may be reelected indefinitely.

The Board of Directors’ meeting is held at least once a week and when required by any director. The Board of Directors is responsible for the Bank’s general management and makes all the necessary decisions to such end. The Board of Directors’ members also take part, to a greater or lesser extent, in the commissions and committees created. Therefore, they are continuously informed about the Bank’s course of business and become aware of the decisions made by such bodies, which are transcribed into minutes.

Additionally, the Board of Directors receives a monthly report prepared by the general manager (the “General Manager”), the purpose of which is to report the material issues and events addressed at the different meetings held between the General Manager and Senior Management. The Board of Directors becomes aware of such reports, as evidenced in the minutes.

66

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

In connection with directors’ training and development, the Bank has a program, which is reviewed every nine months, whereby they regularly attend courses and seminars of different kinds and subjects.

The Bank’s executive officers, including directors, have proven updated knowledge and skills; and the Board of Directors performs its duties in the most effective manner in line with the current dynamics of such a Board.

According to the activities carried out by the Bank, effective laws and corporate strategies, the following committees have been created to achieve an effective control over all activities performed by the Bank:

- Risk and Capital Allocation Committee

The committee is in charge of approving and analyzing capital allocation, establishing risk policies and monitoring the Bank’s risk.

- High Credit Committee

This committee’s function is to approve and sign credit ratings and grant transactions related to high-risk groups and customers, i.e., greater than 2.5% of the Bank’s individual Computable Regulatory Capital, loans to financial institutions (local or foreign) and related customers, in which case two thirds of the Board of Directors is required to participate.

- Low Credit Committee

This committee’s function is to approve and sign the credit ratings and grant transactions related to medium-risk groups and customers, equal to amounts greater than 1% of the Bank’s individual Computable Regulatory Capital.

- Asset and Liability Management Committee

The committee is in charge of analyzing the fundraising and its placement in different assets, the follow-up and control of liquidity, interest-rate and currency mismatches, and management thereof.

- Information Technology Committee

This committee is in charge of supervising and approving the development plans of new systems and their budgets, as well as supervising these systems’ budget control. It is also responsible for approving the general design of the systems’ structure, the main processes thereof and the systems implemented, as well as monitoring the quality of the Bank’s systems, within the policies established by the Board of Directors.

- Audit Committee

The Audit Committee is responsible for helping the Board of Directors, in performing the control function of the Bank and its controlled companies and the companies in which it owns a stake, in order to fairly ensure the following objectives:

• Effectiveness and efficiency of operations;

• Reliability of the accounting information;

• Compliance with applicable laws and regulations; and

• Compliance with the goals and strategy set by the Board of Directors.

- Committee for the Control and Prevention of Money Laundering and Funding of Terrorist Activities (CPLA/FT, as per its initials in Spanish)

The committee is in charge of planning, coordinating and ensuring compliance with the policies on anti-money laundering and funding of terrorist activities set and approved by the Board of Directors.

- Committee for Information Integrity

The committee is in charge of encouraging compliance with the provisions of Sarbanes-Oxley (2002).

- Human Resources and Governance Committee

67

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The committee is in charge of presenting the succession of the General Manager and Division Managers, analyzing and establishing the General Manager’s and Division Managers’ compensation, and monitoring the performance matrix of Department and Division Managers.

- Performance Reporting Committee

The committee is in charge of monitoring the performance and results of operations, and evaluating the macro situation.

- Liquidity Crisis Committee

The committee is in charge of evaluating the situation upon facing a liquidity crisis and deciding the steps to be implemented to tackle it.

- Strategy and New Businesses Committee

The committee is in charge of analyzing new businesses.

- Compliance Committee

The committee is in charge of instilling respect for the Bank’s rules and code of conduct and ethics, and mitigating the risk of default, by defining policies and establishing controls and reports in the best interests of the Bank and its employees, shareholders and customers.

- Committee for the Protection of Users of Financial Services

The committee is responsible for following up on the activities developed by the Bank’s management involved in user protection internal processes, to ensure adequate compliance with legal and regulatory standards.

The Bank considers the General Manager and Division Management reporting to the General Manager as Senior Management. Their duties are detailed as follows:

Retail Banking Division

Wholesale Banking Division

Finance Division

Comprehensive Corporate Services Division

Organizational Development and Human Resources Division

Risk Management Division

Strategic Planning and Management Control Division

Customer’s Experience Division

Senior Management’s main duties are as follows:

- Ensure that the Bank’s activities are consistent with the business strategy, the policies approved by the Board of Directors and the risks to be assumed.

- Implement the necessary policies, procedures, processes and controls to manage operations and risks cautiously, meet the strategic goals set by the Board of Directors and ensure that the latter receives material, full and timely information so that it may assess management and analyze whether the responsibilities assigned are effectively fulfilled.

- Monitor the managers from different divisions, in line with the policies and procedures set by the Board of Directors and establish an effective internal control system.

Basic Holding Structure

The Bank’s majority shareholder is the Company, which has full control of its shares and votes. In turn, the Bank holds equity investments in supplementary companies as controlling company, as well as minority interests in companies whose controlling company is its own controlling company. From a business point of view, this structure allows the Bank to take advantage of significant synergies that guarantee the loyalty of its customers and additional businesses.

68

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

All business relationships with these companies, whether permanent or occasional in nature, are fostered under the normal and usual market conditions and this is true when the Bank holds either a majority or minority interest. The Company’s Board of Directors submits to the Shareholders’ Meeting’s vote, which shall be the Company’s vote in its capacity as controlling company at the Bank’s Shareholders’ Meeting. The same method of transparency and information as to its controlled companies and the companies it owns a stake in is applied at the Bank’s Shareholders’ Meetings, which are always attended by directors and officers thereof. The Board of Directors always provides detailed information about the Company’s activities.

Business Conduct Policy and/or Code of Ethics

The Bank has a formally approved Code of Ethics that guides its policies and activities. The Bank’s Code of Ethics considers business objectivity and conflict of interest-related aspects, as well as how employees should act upon identifying a breach of the Code of Ethics, with the involvement of the Conduct Committee.

Information Related to Personnel Economic Incentive Practices

The Human Resources and Governance Committee, composed of two (2) Directors, the General Manager and the Organizational Development and Human Resources Division Manager, is in charge of establishing the compensation policy for the Bank’s personnel.

It is the policy of the Bank to manage the full compensation of its personnel based on the principles of fairness, meritocracy and justice, within the framework of the legal regulations in force.

The aim of this policy is to provide an objective and fair basis, through the design and implementation of tools for the management of the fixed and variable compensation paid to each employee, based on the scope and complexity of each position’s responsibilities, individual performance with regard to compliance thereof, contribution to the Bank’s results and conformity to market values, with the purpose of:

- Attracting and creating loyalty with regard to quality personnel suitable for the achievement of the business strategy and goals.

- Being an individual motivation means.

- Easing the decentralized management of compensation administration.

- Allowing the effective budget control of personnel costs.

- Guaranteeing internal fairness.

In order to monitor and guarantee both external and internal fairness with regard to the payment of fixed and variable compensation, the Compensation area uses, and puts at the disposal of the Senior Management and the Human Resources Committee, market surveys published by consulting firms specialized in compensation issues, pursuant to the market positioning policies defined by the management division for the different corporate levels.

With the purpose of gearing individuals towards the achievement of attainable results that contribute to the global performance of the Bank/Area, and to the increase in motivation for the common attainment of goals, differentiating individual contribution, the Bank has different variable compensation systems:

1) Business Incentives and/or Incentives through Commissions system for business areas.

2) Annual Bonus System for management levels, officers and the rest of the employees who are not included in the business incentives system. The annual bonus is determined based on individual performance and the Bank’s results, and is paid in the first quarter of the next fiscal year. To determine the variable compensation for the Senior Management and Middle Management, the Bank uses the Management Performance Assessment System. This system has been designed including both qualitative and quantitative KPI (Key Performance Indicators). In particular, quantitative Key Performance Indicators are designed with respect to at least three minimum aspects:

a) Results.

b) Business volume or size.

c) Projections: Indicators that protect the business for the future (For example: Quality, internal and external customer satisfaction, risk coverage, work environment, etc.).

The significance or impact of each of them is monitored and adjusted yearly pursuant to the strategy approved by the Board of Directors.

69

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($) and Thousands of U.S. Dollars (US$), Except as Otherwise Stated

The interaction among these three aspects seeks to make incentives related to results and growth consistent with the risk thresholds determined by the Board of Directors. In turn, there is no deferred payment of variable compensation subject to the occurrence of future events or in the long term, taking into consideration that the business environment in the Argentine financial system is characterized by being mainly transactional, with lending and borrowing transactions with a very short seasoning term.

Annual budget and management control – the latter carried out monthly in a general manner and quarterly in a more detailed manner – include different risk ratios, including the ratio between compensation and risks undertaken.

Variable compensation is only paid in cash. There are no share-based payments.

Every change to this policy is submitted to the Bank’s Human Resources Committee for its consideration.

70

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE A – BREAKDOWN OF GOVERNMENT AND PRIVATE SECURITIES

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Holdings				Position
	Fair Value	Fair Value Level	Carrying Amount		Without Options	Options	Final
			09.30.18	12.31.17
FAIR VALUE DEBT SECURITIES WITH CHANGES TO INCOME	-		22,562,575	28,978,240	21,428,177	-	21,428,177
Argentine:	-		22,560,596	28,977,320	21,426,198	-	21,426,198
Government Securities	-	Level 1	6,126,407	9,285,212	6,427,577	-	6,427,577
Government Securities	-	Level 2	255,234	-	241,788	-	241,788
Government Securities	-	Level 3	272,584	165,214	272,584	-	272,584
Argentine Central Bank’s Bills	-	Level 1	48,759	17,268,730	48,759	-	48,759
Argentine Central Bank’s Bills	-	Level 2	14,423,636	590,034	14,423,636	-	14,423,636
Private Securities	-	Level 1	336,845	559,087	574,985	-	574,985
Private Securities	-	Level 2	283,176	4,000	283,176	-	283,176
Private Securities	-	Level 3	813,955	1,105,043	813,955	-	813,955
Foreign			1,979	920	1,979	-	1,979
Government Securities	-	Level 1	1,979	920	1,979	-	1,979
OTHER DEBT SECURITIES(*)	-		15,865,750	2,708,652	15,937,174	-	15,937,174
Measured at Fair Value with Changes in OCI	-		9,487,006	96,481	9,487,006	-	9,487,006
Argentine:	-		9,487,006	96,481	9,487,006	-	9,487,006
Government Securities	-	Level 1	9,487,006	96,481	9,487,006	-	9,487,006
Measurement at Amortized Cost	-		6,378,744	2,612,171	6,450,168	-	6,450,168
Argentine:	-		6,378,744	2,612,171	6,450,168	-	6,450,168
Other Debt Securities	-		6,378,744	2,612,171	6,450,168	-	6,450,168
Foreign	-		-	-	-	-	-
Government Securities	-		-	-	-	-	-
Private Securities	-		-	-	-	-	-

(*) Including loan loss provisions set up by Banco Galicia in the amount of $71,424 as of September 30, 2018 and $133,685 as of December 31, 2017.

71

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE A – BREAKDOWN OF GOVERNMENT AND PRIVATE SECURITIES (Continued)

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Holdings				Position
	Fair Value	Fair Value Level	Carrying Amount		Without Options	Options	Final
			09.30.18	12.31.17
MEASUREMENT AT AMORTIZED COST	-		-	-	-	-	-
Argentine:	-		-	-	-	-	-
Government Securities	-		-	-	-	-	-
Private Securities	-		-	-	-	-	-
Foreign	-		-	-	-	-	-
Government Securities	-		-	-	-	-	-
Private Securities	-		-	-	-	-	-
EQUITY INSTRUMENTS	-		132,032	75,806	634	-	634
Measured at Fair Value with Changes in Profit or Loss	-		132,032	75,806	634	-	634
Argentine:	-		95,850	56,684	634	-	634
Private Securities	-	Level 1	634	-	634		634
Private Securities	-	Level 3	95,216	56,684	95,216	-	95,216
Foreign	-		36,182	19,122	36,182	-	36,182
Private Securities	-	Level 1	3,789	19,122	3,789	-	3,789
Private Securities	-	Level 3	32,393	-	32,393	-	32,393
Measured at Fair Value with Changes in Other Comprehensive Income	-		-	-	-	-	-
Argentine:	-		-	-	-	-	-
Foreign	-		-	-	-	-	-

72

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE B – CLASSIFICATION OF LOANS AND OTHER FINANCING ACTIVITIES BY STATUS AND GUARANTEES RECEIVED

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	09.30.18		12.31.17
COMMERCIAL LOAN PORTFOLIO
Normal		166,929,535		88,893,685
Backed by Preferred Guarantees and Counter-guarantees “A”		8,369,323		63,783
Backed by Preferred Guarantees and Counter-guarantees “B”		8,101,628		5,392,043
With No Preferred Guarantees or Counter-guarantees		150,458,584		83,437,859
With Special Follow-Up – Under Observation		505,170		51,014
Backed by Preferred Guarantees and Counter-guarantees “B”		251,515		2,566
With No Preferred Guarantees or Counter-guarantees		253,655		48,448
With Problems		270,358		156,280
Backed by Preferred Guarantees and Counter-guarantees “B”		242,191		99,051
With No Preferred Guarantees or Counter-guarantees		28,167		57,229
High Risk of Insolvency		136,479		184,252
Backed by Preferred Guarantees and Counter-guarantees “B”		37,691		55,775
With No Preferred Guarantees or Counter-guarantees		98,788		128,477
Uncollectible		179,339		18,915
Backed by Preferred Guarantees and Counter-guarantees “A”		—		8,366
Backed by Preferred Guarantees and Counter-guarantees “B”		—		2,081
With No Preferred Guarantees or Counter-guarantees		179,339		8,468
TOTAL COMMERCIAL LOAN PORTFOLIO		168,020,881		89,304,146

73

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE B – CLASSIFICATION OF LOANS AND OTHER FINANCING ACTIVITIES BY STATUS AND GUARANTEES RECEIVED (Continued)

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	09.30.18		12.31.17
CONSUMER AND HOUSING LOAN PORTFOLIO
Normal Performance		164,289,712		121,665,984
Backed by Preferred Guarantees and Counter-guarantees “A”		197,729		13,508
Backed by Preferred Guarantees and Counter-guarantees “B”		13,765,749		5,301,381
With No Preferred Guarantees or Counter-guarantees		150,326,234		116,351,095
Low Risk		5,174,836		2,879,295
Backed by Preferred Guarantees and Counter-guarantees “A”		25		1,211
Backed by Preferred Guarantees and Counter-guarantees “B”		123,575		22,824
With No Preferred Guarantees or Counter-guarantees		5,051,236		2,855,260
Medium Risk		3,531,700		1,853,174
Backed by Preferred Guarantees and Counter-guarantees “A”		—		—
Backed by Preferred Guarantees and Counter-guarantees “B”		59,003		8,053
With No Preferred Guarantees or Counter-guarantees		3,472,697		1,845,121
High Risk		3,521,894		2,350,217
Backed by Preferred Guarantees and Counter-guarantees “A”		5,193		364
Backed by Preferred Guarantees and Counter-guarantees “B”		39,976		6,073
With No Preferred Guarantees or Counter-guarantees		3,476,725		2,343,780
Uncollectible		1,042,165		1,027,057
Backed by Preferred Guarantees and Counter-guarantees “A”		9,916		77
Backed by Preferred Guarantees and Counter-guarantees “B”		62,548		21,775
With No Preferred Guarantees or Counter-guarantees		969,701		1,005,205
Uncollectible due to Technical Reasons		7,089		6,670
With No Preferred Guarantees or Counter-guarantees		7,089		6,670
TOTAL CONSUMER AND HOUSING LOAN PORTFOLIO		177,567,396		129,782,397
GRAND TOTAL(1)		345,588,277		219,086,543

(1) Reconciliation between Schedule B and the Balance Sheet:

	09.30.18			12.31.17
Loans and Other Financing Activities		293,939,831			192,767,327
Other Debt Securities		15,865,750			2,708,652
Off-Balance Sheet Agreed Loans and Guarantees Granted		33,338,246			15,846,651
Plus Allowances for Loan Losses		9,456,229			6,198,194
Plus Adjustments under the IFRS-based Accounting Framework that Are Not Computable for the Statement of Debtors’ Status		3,512,451			2,170,655
Less Securities and Other Non-computable Items for the Statement of Debtors’ Status		(10,524,230	)		(604,936	)
Total		345,588,277			219,086,543

74

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE C – CONCENTRATION OF LOANS AND OTHER FINANCING ACTIVITIES

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	LOANS
Number of Customers	09.30.18				12.31.17
	Outstanding   Balance		% of Total   Portfolio		Outstanding   Balance		% of Total   Portfolio
10 Largest Customers		40,993,961		12		15,224,729		7
50 Following Largest Customers		60,133,971		17		26,224,276		12
100 Following Largest Customers		27,213,720		8		12,175,865		6
Remaining Customers		217,246,625		63		165,461,673		75
TOTAL(1)		345,588,277		100		219,086,543		100

(1) Reconciliation between Schedule C and the Balance Sheet:

	09.30.18			12.31.17
Loans and Other Financing Activities		293,939,831			192,767,327
Other Debt Securities		15,865,750			2,708,652
Off-Balance Sheet Agreed Loans and Guarantees Granted		33,338,246			15,846,651
Plus Allowances for Loan Losses		9,456,229			6,198,194
Plus Adjustments under the IFRS-based Accounting Framework that Are Not Computable for the Statement of Debtors’ Status		3,512,451			2,170,655
Less Securities and Other Non-computable Items for the Statement of Debtors’ Status		(10,524,230	)		(604,936	)
Total		345,588,277			219,086,543

75

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE D – BREAKDOWN BY TERM OF LOANS AND OTHER FINANCING ACTIVITIES

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

The following table shows the decline in contractual cash flows, including interest and other expenses to be accrued until contractual maturity.

	Past-due Loan Portfolio		Terms Remaining to Maturity												Total
Item			1 Month		3 Months		6 Months		12 Months		24 Months		Over 24 Months
Non-financial Public Sector		-		71,832		-		-		-		-		-		71,832
Financial Sector		-		4,601,331		1,016,674		646,491		2,666,207		1,487,081		1,646,761		12,064,545
Non-financial Private Sector and Residents Abroad		5,333,407		127,273,361		57,454,566		42,248,251		59,031,469		28,938,460		46,464,117		366,725,631
TOTAL		5,333,407		131,946,524		58,471,240		42,894,742		61,679,676		30,425,541		48,110,878		378,862,008

76

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE F – CHANGES IN PROPERTY, PLANT AND EQUIPMENT

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Value at Beginning of Fiscal Year		Estimated Useful Life in Years		Additions		Disposals			Transfers			Depreciation											Net Book Value as of
													Accumulated			Disposals		For the Period			At Period-end			09.30.18		12.31.17
Measurement at Cost
Real Estate		7,856,385		50		353,266		(546,518	)		42,478			(539,667	)		2,564		(85,022	)		(622,125	)		7,083,767		7,208,738
Furniture and Fixtures		708,911		10		378,636		(236,761	)		149,840			(309,385	)		-		(67,768	)		(377,153	)		623,473		393,772
Machines and Equipment		2,503,074		3 and 5		790,437		(286,290	)		11,087			(1,087,470	)		2		(339,427	)		(1,426,895	)		1,591,413		1,404,289
Vehicles		37,114		5		22,901		(6,034	)		-			(10,829	)		-		(5,983	)		(16,812	)		37,169		23,367
Personal Property Acquired for Financial Leases		7,956		5		-		-			-			(7,956	)		-		-			(7,956	)		-		-
Miscellaneous		383,513		5 and 10		3,217		(2,214	)		92,069			(107,848	)		-		(62,338	)		(170,186	)		306,118		274,774
Work in Progress		485,177		-		825,704		(24,284	)		(277,171	)		(104,228	)		-		(24,646	)		(128,874	)		880,552		485,458
Total		11,982,130				2,374,161		(1,102,101	)		18,303			(2,167,383	)		2,566		(585,184	)		(2,750,001	)		10,522,492		9,790,398

Item	Value at Beginning of Fiscal Year		Estimated Useful Life in Years		Additions		Disposals			Transfers			Depreciation											Net Book Value as of
													Accumulated			Disposals		For the Period			At Period-end			12.31.17		01.01.17.
Measurement at Cost
Real Estate		6,541,585		50		148,502		(36,633	)		1,203,043			(553,386	)		9,640		(103,992	)		(647,759	)		7,208,738		6,084,747
Furniture and Fixtures		554,327		10		108,203		(3,537	)		49,918			(258,516	)		-		(56,623	)		(315,139	)		393,772		272,651
Machines and Equipment		1,740,375		3 and 5		674,426		(428	)		88,701			(776,770	)		33		(322,048	)		(1,098,785	)		1,404,289		930,372
Vehicles		29,563		5		9,427		(6,658	)		4,782			(7,754	)		299		(6,292	)		(13,747	)		23,367		18,423
Personal Property Acquired for Financial Leases		7,956		5		-		-			-			(7,956	)		-		-			(7,956	)		-		-
Miscellaneous		216,445		5 and 10		30,646		-			136,141			(40,525	)		-		(67,933	)		(108,458	)		274,774		175,761
Work in Progress		1,049,597		-		722,769		(34,912	)		(1,251,996	)		-			-		-			-			485,458		1,049,597
Total		10,139,848				1,693,973		(82,168	)		230,589			(1,644,907	)		9,972		(556,888	)		(2,191,844	)		9,790,398		8,531,551

77

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE G – CHANGES IN INTANGIBLE ASSETS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Value at Beginning of Fiscal Year		Estimated Useful Life in Years		Additions		Disposals								Amortization						Net Book Value as of
										Accumulated			Disposals		For the Period			At Period-end			09.30.18		12.31.17
Measurement at Cost
Licenses		1,659,100		5		448,911		(616,664	)		(645,386	)		-		(192,358	)		(837,744	)		653,603		294,864
Intangible Assets Acquired for Financial Lease		26,353		5		-		-			(25,754	)		-		(599	)		(26,353	)		-		599
Other Intangible Assets		1,507,443		5		4,882		(5,132	)		(996,846	)		881		(53,016	)		(1,048,981	)		458,212		610,398
Total		3,192,896				453,793		(621,796	)		(1,667,986	)		881		(245,973	)		(1,913,078	)		1,111,815		905,861

Item	Value at Beginning of Fiscal Year		Estimated Useful Life in Years		Additions		Disposals								Amortization						Net Book Value as of
										Accumulated			Disposals		For the Period			At Period-end			12.31.17		01.01.17
Measurement at Cost
Licenses		955,156		5		155,343		(1,928	)		(597,836	)		-		(215,871	)		(813,707	)		294,864		354,667
Intangible Assets Acquired for Financial Lease		26,352		5		-		-			(23,119	)		-		(2,634	)		(25,753	)		599		3,233
Other Intangible Assets		1,395,719		5		43,423		(232	)		(821,591	)		-		(6,921	)		(828,512	)		610,398		473,204
Total		2,377,227				198,766		(2,160	)		(1,442,546	)		-		(225,426	)		(1,667,972	)		905,861		831,104

78

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE H – CONCENTRATION OF DEPOSITS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	DEPOSITS
Number of Customers	09.30.18				12.31.17
	Outstanding Balance		% of Total Portfolio		Outstanding Balance		% of Total Portfolio
10 Largest Customers		13,533,858		4		10,218,113		5
50 Following Largest Customers		24,507,260		8		11,244,990		6
100 Following Largest Customers		15,397,864		5		6,930,668		3
Remaining Customers		266,613,407		83		172,323,133		86
TOTAL		320,052,389		100		200,716,904		100

79

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE I – BREAKDOWN OF FINANCIAL LIABILITIES BY REMAINING TERM

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

The following table shows the decline in contractual cash flows, including interest and other expenses to be accrued until contractual maturity.

Item	Terms Remaining to Maturity												Total
	1 Month		3 Months		6 Months		12 Months		24 Months		Over 24 Months
Deposits (1)		293,793,682		23,001,916		6,571,176		1,965,559		44,294		30,999		325,407,626
Non-financial Public Sector		4,282,200		660,350		-		-		-		-		4,942,550
Financial Sector		564,160		-		-		-		-		-		564,160
Non-financial Private Sector and Residents Abroad		288,947,322		22,341,566		6,571,176		1,965,559		44,294		30,999		319,900,916
Fair Value Liabilities with Changes to Income		385,031		-		-		-		-		-		385,031
Derivative Instruments		6,624,894		-		-		-		-		-		6,624,894
Repo Transactions		-		-		-		-		-		-		-
Other Financial Liabilities		57,772,341		8,979		19,442		33,026		53,031		108,126		57,994,945
Loans from the Argentine Central Bank and Other Financial Institutions		6,795,270		6,402,617		6,198,031		4,701,581		2,869,434		5,470,204		32,437,137
Notes Issued		1,134,809		2,568,647		2,030,723		9,250,418		19,532,786		11,058,834		45,576,217
Subordinated Notes		-		-		168,699		415,970		831,940		15,179,527		16,596,136
TOTAL		366,506,027		31,982,159		14,988,071		16,366,554		23,331,485		31,847,690		485,021,986

(1) Maturities in the first month include:

- Checking Accounts $34,732,773

- Savings Accounts $171,540,809

- Time Deposit $85,332,006

- Other Deposits $2,225,524

80

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE J – CHANGES IN PROVISIONS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Balances at Beginning of Fiscal Year		Increases		Decreases				Balances as of 09.30.18		Balances as of 12.31.17
					Reversals		Uses
INCLUDED IN LIABILITIES
For Administrative, Disciplinary and Criminal Penalties		4,983		16,856		3,708		12,825		5,306		4,983
Provisions for Termination Benefits		74,025		85,755		10,723		66,833		82,224		74,025
Others		528,447		868,592		3,195		-		1,393,844		528,447
TOTAL PROVISIONS		607,455		971,203		17,626		79,658		1,481,374		607,455

81

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE L – FOREIGN CURRENCY BALANCES

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Items	Head Office and Argentine Branches		09.30.18		09.30.18							12.31.17
					Dollar		Euro		Real	Others
ASSETS
Cash and Bank Deposits		82,999,149		82,999,149		80,960,128		1,920,040	15,232		103,749		37,255,522
Fair Value Debt Securities with Changes to Income		3,135,002		3,135,002		3,135,002		-	-		-		5,818,448
Derivative Instruments		144,340		144,340		144,340		-	-		-		13
Other Financial Assets		1,862,546		1,862,546		1,862,546		641	-		-		752,112
Loans and Other Financing Activities		100,031,192		100,031,192		99,832,148		199,044	-		-		40,371,292
Argentine Central Bank		5,216		5,216		5,216		-	-		-		1,908
Other Financial Institutions		1,090,460		1,090,460		1,090,460		-	-		-		370,258
To the Non-financial Private Sector and Residents Abroad		98,935,516		98,935,516		98,736,472		199,044	-		-		39,999,126
Other Debt Securities		5,399,051		5,399,051		5,399,051		-	-		-		1,583,413
Financial Assets Pledged as Collateral		494,427		494,427		494,427		-	-		-		140,320
Current Income Tax Assets		-		-		-		-	-		-		-
Investments in Equity Instruments		36,182		36,182		32,393		3,789	-		-		20,715
Other Non-financial Assets		22,268		22,268		22,268		-	-		-		21,358
TOTAL ASSETS		194,124,157		194,124,157		191,881,662		2,123,514	15,232		103,749		85,963,193

82

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE L – FOREIGN CURRENCY BALANCES (Continued)

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Items	Head Office and Argentine Branches		09.30.18		09.30.18								12.31.17
					Dollar		Euro		Real		Others
LIABILITIES
Deposits		153,188,361		153,188,361		153,188,361		-		-		-		70,397,314
Non-financial Public Sector		14,263		14,263		14,263		-		-		-		6,166
Financial Sector		9,642		9,642		9,642		-		-		-		3,994
Non-financial Private Sector and Residents Abroad		153,333,040		153,333,040		153,333,040		-		-		-		70,387,154
Fair Value Liabilities with Changes to Income		98,370		98,370		98,370		-		-		-		-
Derivative Instruments		11,549		11,549		11,549		-		-		-		-
Other Financial Liabilities		6,839,259		6,839,259		6,494,768		325,647		-		18,844		3,023,991
Loans from the Argentine Central Bank and Other Financial Institutions		20,579,272		20,579,272		20,381,959		197,313		-		-		5,450,640
Notes Issued		4,150,261		4,150,261		4,150,261		-		-		-		-
Subordinated Notes		10,392,874		10,392,874		10,392,874		-		-		-		4,828,018
Other Non-financial Liabilities		329,172		329,172		329,091		81		-		-		973,524
TOTAL LIABILITIES		195,589,118		195,589,118		195,047,233		523,041		-		18,844		84,673,487

83

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE O – DERIVATIVE INSTRUMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Type of Contract

Purpose of Transactions

Underlying Asset

Type of Settlement

Trading Environment or Counterparty

Originally- Agreed Weighted Average Term

Residual Weighted Average Term

Weighted Average Term for Settlement of Differences

Amount(*)

Foreign Currency Forwards

OTC - Purchases

Brokerage - own account

Foreign currency

Daily settlement of the difference

MAE

2

1

1

17,791,693

OTC - Sales

Brokerage - own account

Foreign currency

Daily settlement of the difference

MAE

8

3

1

4,267,576

ROFEX - Purchases

Brokerage - own account

Foreign currency

Daily settlement of the difference

ROFEX

5

3

1

58,825,347

ROFEX - Sales

Brokerage - own account

Foreign currency

Daily settlement of the difference

ROFEX

3

2

1

56,717,917

Forwards with Customers

Purchases

Brokerage - own account

Foreign currency

Upon maturity of differences

OTC - Residents in Argentina - Non- financial sector

3

2

42

357,515

Purchases

Brokerage - own account

Foreign currency

Upon maturity of differences

OTC - Residents Abroad

3

2

52

3,527,961

Sales

Brokerage - own account

Foreign currency

Upon maturity of differences

OTC - Residents in Argentina - Non- financial sector

5

0

134

16,565,640

Sales

Brokerage - own account

Foreign currency

Upon maturity of differences

OTC - Residents Abroad

3

0

2

223,801

Repo Transactions

Forward Sales

Brokerage - own account

Argentine government securities

With delivery of the underlying asset

MAE

-

-

-

14,006,042

Swaps

Fixed for Variable Interest Rate Swaps

Brokerage - own account

Others

Others

MAE

19

3

1

1,000

Swaps with Customers

Variable for Fixed Interest Rate Swaps

Brokerage - own account

Others

Others

OTC - Residents in Argentina - Financial sector

26

19

1

466,298

(*) Relates to the notional amount.

84

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE R – VALUE ADJUSTMENT BY LOSSES – ALLOWANCE FOR LOAN LOSSES

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Balances at Beginning of Fiscal Year		Increases		Decreases				Balances as of 09.30.18		Balances as of 12.31.17
					Reversals		Uses
Loans and Other Financing Activities		6,083,947		8,819,076		463		5,436,844		9,465,716		6,083,947
Non-financial Private Sector and Residents Abroad		6,083,947		8,819,076		463		5,436,844		9,465,716		6,083,947
Overdrafts		148,135		251,612		-		87,575		312,172		148,135
Mortgage Loans		37,208		46,774		-		3,167		80,815		37,208
Collateral Loans		4,051		3,654		-		367		7,338		4,051
Personal Loans		457,123		747,727		-		432,053		772,797		457,123
Credit Card Loans		3,126,734		5,421,618		-		4,493,059		4,055,293		3,123,734
Financial Leases		3,246		2,642		-		1,071		4,817		3,246
Others		2,307,450		2,345,049		463		419,552		4,232,484		2,307,450
Private Securities		133,686		24,658		-		144,609		13,735		133,686
TOTAL ALLOWANCES		6,217,633		8,843,734		463		5,581,453		9,479,451		6,217,633

85

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

The following information is current as of December 31, 2017 and has been prepared in accordance with the accounting framework set forth by the Argentine Central Bank. The following information is required to understand the consolidated condensed interim financial statements.

1. CASH AND BANK DEPOSITS

Cash equivalents are held to meet short-term payment commitments, rather than for investment-related or similar purposes. In order for a financial investment to be classified as a cash equivalent, it should be readily convertible into a certain amount of cash and should bear an immaterial risk of change in value. Accordingly, an investment will be classified as a cash equivalent if it matures within three months or less from the acquisition date. Equity interests are excluded from cash equivalents.

The table below shows a breakdown of items comprising cash and cash equivalents:

	12.31.17		01.01.17.
Cash and Bank Deposits		58,943,266		65,767,565
Cash and Bank Deposits from Tarjetas Regionales S.A.		5,730		-
Argentine Central Bank’s Bills and Notes Maturing within up to 90 Days		17,107,571		6,903,609
Receivables from Reverse Repo Transactions		9,654,517		-
Local Interbank Loans		935,000		862,300
Overnight Placements in Banks Abroad		288,991		1,227,101
Mutual Funds		2,427,240		2,193,056
Time Deposits		6,034		3,459
Government Securities		-		993,697
Total Cash and Cash Equivalents		89,368,349		77,950,673

2. FINANCIAL INSTRUMENTS

As of the indicated dates, the Group maintains the following portfolios of financial instruments:

Instruments Portfolio as of 12.31.17	Fair Value with Changes in Profit or Loss		Amortized Cost		Fair Value – OCI
Assets
Argentine Central Bank’s Bills and Notes		17,858,764		-		-
Government Securities		9,451,346		-		-
Private Securities		1,668,130		-		-
Derivative Instruments		537,000		-		-
Repo Transactions		-		9,676,101		-
Other Financial Assets		3,097,830		3,960,011		-
Loans and Other Financing Activities		-		192,767,327		-
Other Debt Securities (Trusts and Notes)		-		2,612,171		96,481
Financial Assets Pledged as Collateral		391,287		5,939,270		-
Equity Instruments		75,806		-		-
Liabilities
Deposits		-		200,716,904		-
Derivative Instruments		584,856		-		-
Repo Transactions		-		1,131,127		-
Other Financial Liabilities		-		37,488,925		-
Loans from the Argentine Central Bank and Other Financial Institutions		-		7,869,048		-
Notes Issued		-		13,739,066		-
Subordinated Notes		-		4,828,018		-

86

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Instruments Portfolio as of 01.01.17	Fair Value with Changes in Profit or Loss		Amortized Cost		Fair Value – OCI
Assets
Argentine Central Bank’s Bills and Notes		8,769,477		-		-
Government Securities		5,242,489		-		-
Private Securities		2,277,598		-		-
Derivative Instruments		124,521		-		-
Other Financial Assets		2,505,623		1,132,348		-
Loans and Other Financing Activities		-		133,882,276		-
Other Debt Securities (Trusts and Notes)		543,874		418,089		-
Equity Instruments		101,563		-		-
Financial Assets Pledged as Collateral		636,865		4,841,989		-
Liabilities
Deposits		-		150,377,065		-
Derivative Instruments		157,599		-		-
Repo Transactions		-		1,644,715		-
Other Financial Liabilities		-		31,299,292		-
Loans from the Argentine Central Bank and Other Financial Institutions		-		6,896,317		-
Notes Issued		-		11,857,718		-
Subordinated Notes		-		4,065,255		-

3. FAIR VALUES

The Group classifies the fair values of financial instruments in three levels, according to the quality of data used to determine them.

Below is a summary of the Group’s financial instruments measured at fair value as of the dates indicated below:

Instruments Portfolio as of 12.31.17	Fair Value Level 1		Fair Value Level 2		Fair Value Level 3
Assets
- Argentine Central Bank’s Bills and Notes		17,268,730		590,034		-
- Government Securities		9,286,132		-		165,214
- Private Securities		559,087		4,000		1,105,043
- Derivative Instruments		-		537,000		-
- Other Financial Assets		3,058,830		-		39,000
- Other Debt Securities(*)		96,481		-		-
- Financial Assets Pledged as Collateral		391,287		-		-
- Equity Instruments		19,122		-		56,684
Liabilities
- Derivative Instruments		-		584,856		-
Total		30,679,669		546,178		1,365,941
Instruments Portfolio as of 01.01.17	Fair Value Level 1		Fair Value Level 2		Fair Value Level 3
Assets
- Argentine Central Bank’s Bills and Notes		8,769,477		-		-
- Government Securities		4,475,435		77,616		689,438
- Private Securities		644,031		-		1,633,567
- Derivative Instruments		-		124,521		-
- Other Debt Securities		504,874		-		39,000
- Other Financial Assets		2,505,623		-		-
- Financial Assets Pledged as Collateral		636,865		-		-
- Equity Instruments		50,868		-		50,695
Liabilities
- Fair Value Liabilities with Changes to Income		-		157,599		-
Total		17,587,173		44,538		2,412,700

Valuation methods are detailed in Note 4.

87

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Changes in instruments included in fair value Level 3 are as follows:

Level 3 as of 12.31.17	Balance as of 01.01.17	Purchases	Sales		Income (Loss)		Balance as of 12.31.17
- Government Securities	689,438	165,214	(689,438	)	-		165,214
- Private Securities	1,633,567	1,105,043	(1,630,237	)	(3,330	)	1,105,043
- Other Financial Assets	39,000	-	-		-		39,000
- Equity Instruments	50,695	-	-		5,989		56,684
Total	2,412,700	1,270,257	(2,319,675	)	2,659		1,365,941

All items included in Level 3 are assumed as instruments recognized and derecognized in the same year.

The Group’s policy is to recognize transfers among fair value levels only as of year-end dates, there being no changes to financial instruments held in portfolios as of December 31, 2017.

4 REPO TRANSACTIONS

Below is a summary of the residual value of assets transferred under repo transactions:

	12.31.17
Reverse Repo Transactions Carried in Off-balance Sheet Items		9,697,406
Repo Transactions Carried in Financial Assets Pledged as Collateral		1,132,573

5. PROVISIONS

Below is a summary of the movements in provisions, including administrative, disciplinary and criminal penalties, severance payments, and other contingencies:

	12.31.17
Balance at the Beginning		384,876
Increases		367,867
Reversals		43,550
Uses		101,738
Balance at Year-end		607,455

6. OTHER FINANCIAL ASSETS

The table below shows a breakdown of other financial assets as of the dates indicated below:

	12.31.17		01.01.17.
Debtors from Foreign Exchange Brokerage		2,404,843		3,212
Debtors from Spot Sales of Government Securities Pending Settlement		1,016,345		731,163
Sundry Debtors		377,952		26,677
Mutual Funds		3,058,830		2,460,237
Others		199,871		416,682
Total		7,057,841		3,637,971

7. TRANSFER OF FINANCIAL ASSETS

All transfers of financial assets qualify for derecognition of financial assets in their entirety.

In derecognizing a financial asset, the difference between the carrying amount and the amount received as consideration is attributed to income.

The Company mainly consummates non-recourse portfolio sales, with the assigned portfolio in the 2017 fiscal year amounting to $903,197 and cash flows from portfolio sales amounting to $1,016,478.

8. PROPERTY, PLANT AND EQUIPMENT

Changes in “Property, Plant and Equipment” are detailed in Schedule F.

9. INTANGIBLE ASSETS

The Group’s “Intangible Assets” are detailed in Schedule G.

88

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

10. NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

As of the dates indicated below, the Group held the following assets for sale and discontinued operations:

	12.31.17		01.01.17.
Equity Investments in Subsidiaries
Prisma Medios de Pago S.A.		208,972		-
Compañía Financiera Argentina S.A.(*)		5,643,848		5,886,847
Cobranzas y Servicios S.A.(*)		29,906		36,908
Property, Plant and Equipment
Real Estate		2,328		2,328
Total		5,885,054		5,926,083

(*) The amount relates to the net balance of assets and liabilities held for sale, booked under “Non-current Assets Held for Sale” and “Other Non-financial Liabilities”, respectively.

The information below is related to the Group’s discontinued operations (Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A.):

Cash Flows	12.31.17			01.01.17.
Operating Activities		(372,099)			(359,745)
Investing Activities		(37,608)			(21,322)
Financing Activities		333,197			384,019
Total Cash and Cash Equivalents		(76,510	)		2,952

Below is a summary of balance sheet data about these companies:

Compañía Financiera Argentina S.A.	12.31.2017
Assets		5,643,849
Cash and Due from Banks		395,201
Securities		16,776
Loans		4,916,476
Miscellaneous Receivables		208,372
Equity Investments		4,303
Bank Property, Plant and Equipment		39,670
Miscellaneous Assets		2,013
Intangible Assets		61,038
Liabilities		4,678,351
Deposits		1,412,974
Notes		1,250,531
Other Liabilities Resulting from Financial Brokerage		1,649,704
Miscellaneous Liabilities		322,589
Allowances		42,553
Cobranzas y Servicios S.A.	12.31.2017
Assets		29,906
Cash and Due from Banks		296
Securities		12,867
Miscellaneous Receivables		16,743
Liabilities		22,904
Miscellaneous Liabilities		22,904

Assets	12.31.17		01.01.17.
Equity Investments in Subsidiaries
Compañía Financiera Argentina S.A.		965,498		1,215,498
Cobranzas y Servicios S.A.		7,002		7,002
Total Assets		972,500		1,222,500

The table below shows a breakdown of income from discontinued activities and net income recognized from the remeasurement of assets held for sale:

Net Income (Loss)	12.31.17
Income before Taxes from Discontinued Operations		-
Taxes		(185,362)
Net Income (Loss) from Discontinued Operations for the Period		(185,362	)

89

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

11. SHAREHOLDERS’ EQUITY STRUCTURE

	12.31.17		01.01.17.
Capital Stock		1,426,765		1,300,265
Non-capitalized Contributions		10,951,132		219,596
Capital Adjustments		278,131		278,131
Profit Reserves		17,390,568		12,536,831
Retained Income		2,526,325		-
Other Accumulated Comprehensive Income(1)		17,279		284,182
Net Income for the Fiscal Year		8,622,967		8,544,202
Shareholders’ Equity Attributable to the Controlling Company’s Shareholders		41,213,167		23,163,207
Shareholders’ Equity Attributable to Non-controlling Interests		1,935,196		1,451,883
Total Shareholders’ Equity		43,148,363		24,615,090

(1) Attributable to gains from financial instruments at fair value with changes in other comprehensive income.

12. EARNINGS PER SHARE

Earnings per share are calculated by dividing income attributable to the Group’s shareholders by the weighted average of outstanding common shares during the year. As the Group does not have preferred shares or debt convertible into shares, basic earnings are equal to diluted earnings per share.

	12.31.17
Income Attributable to the Group’s Shareholders		8,622,967
Weighted-Average of Ordinary Shares Outstanding (Thousands)		1,332,617
Earnings per Share		6.04

13. INTEREST INCOME/COMMISSION INCOME

Interest Income	12.31.17
On Cash and Bank Deposits		112
On Private Securities		835,134
On Government Securities		294,168
On Loans and Other Financing Activities		32,926,203
Non-financial Public Sector		4,959
Financial Sector		693,805
Non-financial Private Sector		32,227,439
Overdrafts		2,746,566
Mortgage Loans		597,895
Collateral Loans		116,890
Personal Loans		4,844,178
Credit Card Loans		15,310,493
Financial Leases		336,449
Others		8,274,968
On Repo Transactions		792,916
Other Financial Institutions		792,916
Total		34,848,533
Commission Income	12.31.17
Fee and Commissions Related to Notes		3,465,410
Fee and Commissions Related to Credits		11,680,666
Fee and Commissions Related to Loan Commitments and Financial Guarantees		129,249
Fee and Commissions Related to Transferable Securities		501,285
Fee and Commissions on Collection Proceedings		27,298
Fee and Commissions on Foreign and Exchange Rate Transactions		488,071
Total		16,282,979

90

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

14.       INTEREST EXPENSE/COMMISSION EXPENSE

Interest Expense	12.31.17
On Deposits		10,934,613
Non-financial Private Sector		10,934,613
Checking Accounts		646
Savings Accounts		3,493
Time Deposit and Term Investments		10,446,205
Others		484,269
Loans from the Argentine Central Bank and Other Financial Institutions		439,106
On Repo Transactions		222,853
Other Financial Institutions		222,853
On Other Financial Liabilities		2,537,918
On Notes Issued		916,339
On Other Subordinated Notes		349,907
Total		15,400,736

Commission Expense	12.31.17
Fees and Commissions Related to Transactions with Securities		18,655
Others		2,165,992
Total		2,184,647

15.       UNDERWRITING INCOME

The breakdown of Underwriting Income as of December 31, 2017 was as follows:

	12.31.17
Premiums and Surcharges Accrued		3,262,307
Claims Accrued		(410,050	)
Surrenders		(4,355	)
Life and Ordinary Annuities		(5,607	)
Underwriting and Operating Expenses		(745,720	)
Other Income and Expenses		22,708
Total		2,119,283

16.       EXPENSES BY FUNCTION AND NATURE

The Group utilized the expenditure function method in assembling its statement of comprehensive income. Under this method, expenses are classified according to their function as part of the item “Administrative Expenses”.

The table below provides the required additional information about expenses by nature and function:

Administrative Expenses	12.31.17
Fees and Compensation for Services		581,147
Directors’ and Syndics’ Fees		76,832
Advertising, Promotion and Research Expenses		814,386
Taxes and Assessments		2,217,644
Maintenance and Repairs		662,617
Electricity and Communications		622,607
Entertainment and Transportation Expenses		100,150
Stationery and Office Supplies		136,762
Rentals		457,912
Administrative Services Hired		1,109,652
Security		605,652
Insurance		47,943
Others		2,350,392
Total		9,783,696
Depreciation and Impairment of Assets	12.31.17
Depreciation of Property, Plant and Equipment		556,888
Amortization of Organization and Development Expenses		225,426
Others		2,550
Total		784,864

91

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

17. EMPLOYEE BENEFITS

The breakdown of the items disclosed under “Employee Benefits” as of December 31, 2017 is as follows:

	12.31.17
Salaries		6,537,336
Social Security Contributions on Salaries		1,593,672
Severance Payments and Personnel Bonuses		2,022,318
Personnel Services		293,698
Other Short-term Employee Benefits		233,108
Total		10,680,132

18. INCOME TAX

The following is a reconciliation of income tax charged to income as of December 31, 2017 to the application of the current tax rate to book income:

	12.31.17
Income for the Period Before Income Tax		13,824,590
Effective Tax Rate		35	%
Income for the Period at the Tax Rate		4,838,607
Permanent Differences at the Tax Rate
- Allowance for Impairment		(143,077	)
- Non-taxable Income (Loss)		(64,572	)
- Donations and Other Non-deductible Expenses		59,786
- Others		68,071
- Fines		43
- Reversal under Law No. 27430		(182,783	)
Total Income Tax Charge for the Period		4,575,846

	12.31.17
Current Income Tax	4,827,360
Deferred Tax Charge	(104,835	)
Allowance for Impairment	(143,077	)
Law 27430 Adjustment	(3,602	)
Total Income Tax Charge for the Period	4,575,846

The change in deferred income tax assets and liabilities, regardless of the balance offsetting within the same tax jurisdiction, is as follows:

Item	01.01.17.			Charges for the     Period			Others		Allowance for     Impairment		12.31.17
Deferred Tax Assets
Trade Receivables		553,695			794			-		-		554,489
Property, Plant and Equipment		(43,375	)		1,043			-		-		(42,332	)
Other Liabilities		(792	)		(3,980	)		-		-		(4,772	)
Employee Benefits		2,675			(698	)		-		-		1,977
Exchange Rate Difference		5,130			(4,938	)		-		-		192
Provisions for Contingencies		41,908			3,351			-		-		45,259
Other Items		-			19,067			-		-		19,067
Financial Charges		9,552			(15,243	)		-		-		(5,691	)
Other Financial Charges		(17,021	)		(23,530	)		-		-		(40,551	)
Tax Loss Carry-forwards		936			(779	)		-		-		157
Valuation of Debt Securities		3,194			4,332			-		-		7,526
Derivative Instruments		3,566			-			-		-		3,566
Other Assets		3,954			20,455			-		-		24,409
Taxes		-			(92	)		-		-		(92	)
Total Deferred Tax Assets		563,422			(218	)		-		-		563,204

92

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Deferred Tax Liabilities	01.01.17			Charges for the     Period			Others			Allowance for     Impairment			12.31.17
Valuation of Debt Securities		(20,773	)		32,096			-			-			11,323
Allowances for Loan Losses		299,204			(3,746	)		-			-			295,458
Loans		94,149			18,769			-			-			112,918
Property, Plant and Equipment		(1,836,082	)		510,210			-			-			(1,325,872	)
Employee Benefits		1,171			495			22			-			1,688
Miscellaneous		(4,735	)		(31,335	)		-			-			(36,070	)
Other Items		(148,943	)		243			16			-			(148,684	)
Equity Investments in Subsidiaries		-			3,302			-			(1,877	)		1,425
Tax Loss Carry-forwards		148,071			(143,054	)		209			(5,226	)		-
Assets Available for Sale		-			(245,702	)		-			-			(245,702	)
Intangible Assets		309,874			(98,881	)		-			-			210,993
Other Liabilities and Provisions		369,522			63,435			-			-			432,957
Other Financial Assets		(451	)		(779	)		(247	)		-			(1,417	)
Total Deferred Tax Liabilities		(788,993	)		105,053			-			(7,103	)		(691,043	)
Deferred Tax Assets/(Liabilities)		(255,571	)		104,835			-			(7,103	)		(127,839	)

Provisions for the deferred tax asset as of December 31, 2017 and January 1, 2017, amounting to $7,103 and $150,171, respectively, were included, as it is believed that the recovery thereof is not likely as of the date of these financial statements.

In September 2017, the Bank filed actions with A.F.I.P. for recovery of income tax paid in excess for the 2014 and 2016 fiscal years, totaling $433,815 and $944,338, respectively. These actions were predicated on case law that declared unconstitutional certain rules and regulations banning the application of the inflation adjustment for tax purposes, with ensuing confiscatory effects. As of period-end, the Bank has not recorded balances in respect of the contingent assets stemming from the aforementioned actions.

Tax Reform

On December 29, 2017, the National Executive Branch enacted Income Tax Law No. 27430. This law has introduced several changes to the previous income tax treatment. Some of the key changes implicated by the reform include:

- Income Tax Rate: The income tax rate for Argentine companies shall be gradually reduced from 35% to 30% for the fiscal years commencing on January 1, 2018 until December 31, 2019, and to 25% for the fiscal years commencing on, and including, January 1, 2020.

- Tax on Dividends: The law has introduced a tax on dividends or profits distributed by Argentine companies or permanent establishments, among others, to: individuals, undivided interests or foreign beneficiaries, subject to the following considerations: (i) dividends distributed out of the profits made during fiscal years commencing on January 1, 2018 until December 31, 2019 shall be subject to withholding at a 7% rate; and (ii) dividends distributed out of the profits made during fiscal years commencing on January 1, 2020 onwards shall be subject to withholding at a 13% rate.

Dividends distributed from profits earned until the fiscal years before that which commenced on January 1, 2018 shall remain subject, in respect of all beneficiaries, to withholding at the 35% rate on the amount in excess of tax-free distributable accumulated profits (equalization tax transition period).

- Optional Tax Revaluation: Regulations establish that, at the companies’ option, assets that are located in the country and are used for generating taxable income may be subject to tax reevaluation. The special tax on the revaluation amount depends on the asset: 8% for real estate that does not qualify as inventory, 15% for real estate that qualifies as inventory and 10% for personal property and the remaining assets. Once the option for a given asset is exercised, all other assets of the same category should be revalued. Taxable income resulting from the revaluation is not subject to income tax and the special tax on the revaluation amount will not be deductible from such tax.

19. SEGMENT REPORTING

The Group determines segments based on management reports that are reviewed by the Board of Directors and updated to reflect any changes.

93

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIALSTATEMENTS AS OF DECEMBER 31, 2017

Reportable segments are made up of one or more operating segments with similar economic characteristics, distribution channels and regulatory environments.

Below there is a description of each business segment’s composition:

a. Banks: This segment represents the banking business operation results.

b. Regional Credit Cards: This segment represents the results of operations of the regional credit card business and includes the results of operations of Tarjetas Regionales S.A. consolidated with the following subsidiaries: Cobranzas Regionales S.A., Ondara S.A. and Tarjeta Naranja S.A.

c. Insurance: This segment represents the results of operations of the insurance companies’ business and includes the results of operations of Sudamericana Holding S.A. consolidated with the following subsidiaries: Galicia Retiro Cía. de Seguros S.A., Galicia Seguros S.A. and Galicia Broker Asesores de Seguros S.A.

d. Other Businesses: This segment shows the results of operations of Galicia Administradora de Fondos S.A., Galicia Warrants S.A., Net Investment S.A. (in liquidation), Galicia Valores S.A. and Grupo Financiero Galicia S.A., the last two net of eliminations of income from equity investments.

e. Adjustments: This segment includes consolidation adjustments and eliminations of transactions among subsidiaries.

The operating income (loss) of the Group’s different operating segments is monitored separately in order to make decisions on resource allocation and the evaluation of each segment’s performance. Segment performance is evaluated based on operating income or losses and is consistently measured with the operating income and losses of the consolidated income statement.

When any transaction occurs, the transfer pricing among operating segments is at arm’s length similar to transactions performed with third parties. Income, expenses and income (losses) resulting from the transfers among operating segments are then eliminated from consolidation.

The relevant segment reporting as of the dates indicated below is as follows:

	Banks		Regional Credit Cards		Insurance			Others		Adjustments		Total as of 12.31.17
Net Income from Interest (Expense)		12,727,224		6,407,034		297,145			96,980		(80,586)		19,447,797
Net Commission Income (Expense)		7,588,285		7,599,082		-			(1,748)		(1,087,287)		14,098,332
Net Income from Measurement of Fair Value Financial Instruments with Changes to Income		4,228,326		6,175		(18,638)			708,311		(2,671)		4,921,503
Exchange Rate Differences on Gold and Foreign Currency		2,080,287		9,239		1,345			91,526		-		2,182,397
Other Operating Income		3,183,004		760,072		(8,271)			844,312		(28,994)		4,750,123
Underwriting Income		-		-		1,027,099			-		1,092,184		2,119,283
Loan Loss Provisions		(2,586,445)		(2,017,613)		(5,221)			4,494		-		(4,604,785)
Employee Benefits		(7,095,734)		(3,142,164)		(339,021)			(103,213)		-		(10,680,132)
Administrative Expenses		(5,817,495)		(3,593,098)		(275,671)			(121,763)		24,331		(9,783,696)
Depreciation and Impairment of Assets		(551,336)		(203,253)		(23,910)			(6,365)		-		(784,864)
Other Operating Expenses		(6,609,608)		(1,439,814)		58,009			(47,337)		(12)		(8,038,762)
Operating Income (Loss)		7,146,508		4,385,660		712,866			1,465,197		(83,035)		13,627,196
Income for Associates and Joint Ventures		2,401,256		-		2,072			8,095,992		(10,301,926)		197,394
Income before Taxes from Continuing Activities		9,547,764		4,385,660		714,938			9,561,189		(10,384,961)		13,824,590
Income Tax from Continuing Activities		(2,182,886)		(1,664,596)		(252,394)			(290,608)		-		(4,390,484)
Net Income (Loss) from Continuing Activities		7,364,878		2,721,064		462,544			9,270,581		(10,384,961)		9,434,106
Income (Loss) from Discontinued Operations		-		-		-			-		-		-
Income Tax from Discontinued Operations		(185,362)		-		-			-		-		(185,362)
Net Income (Loss) for the Period		7,179,516		2,721,064		462,544			9,270,581		(10,384,961)		9,248,744
Net Income (Loss) for the Period Attributable to the Controlling Company’s Shareholders		7,179,516		2,720,769		462,547			9,270,581		(11,010,446)		8,622,967
Net Income (Loss) for the Period Attributable to Non-controlling Interests		-		295		(3	)		-		625,485		(625,777	)

94

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

	Banks		Regional Credit Cards		Insurance		Others		Adjustments and/or Eliminations			Total as of 12.31.17
ASSETS
Cash and Bank Deposits		58,460,898		536,969		23,394		67,715		(145,711)			58,943,266
Fair Value Debt Securities with Changes to Income		26,572,295		250,631		791,155		1,595,204		(231,045)			28,978,240
Derivative Instruments		525,362		-		-		11,638		-			537,000
Repo Transactions		9,676,101		-		-		-		-			9,676,101
Other Financial Assets		4,118,808		2,169,245		188,660		747,381		(166,253)			7,057,841
Loans and Other Financing Activities		160,845,605		32,364,414		9,488		88,974		(541,154)			192,767,327
Other Debt Securities		2,105,938		-		393,627		209,087		-			2,708,652
Financial Assets Pledged as Collateral		6,325,905		4,652		-		-		-			6,330,557
Current Income Tax Assets		3,392		20,473		86,021		-		(2,555)			194,805
Investments in Equity Instruments		75,806		-		-		-		-			75,806
Investments in Subsidiaries, Associates and Joint Ventures		6,778,282		-		-		40,506,154		(47,284,436)			-
Property, Plant and Equipment		8,973,410		669,495		143,679		3,814		-			9,790,398
Intangible Assets		599,620		249,895		56,316		30		-			905,861
Deferred Income Tax Assets		-		557,904		70		5,230		-			563,204
Other Non-financial Assets		1,814,730		192,956		679,922		189,903		(24,903)			2,852,608
Non-current Assets Held for Sale		5,715,739		-		-		169,315		-			5,885,054
TOTAL ASSETS		292,591,891		37,016,634		2,372,332		43,681,920		(48,396,057)			327,266,720
LIABILITIES
Deposits		200,884,407		-		-		-		(167,503)			200,716,904
Fair Value Liabilities with Changes to Income		-		-		-		-		-			-
Derivative Instruments		584,856		-		-		-		-			584,856
Repo Transactions		1,131,127		-		-		-		-			1,131,127
Other Financial Liabilities		21,230,296		16,532,609		-		2,988		(276,968)			37,488,925
Loans from the Argentine Central Bank and Other Financial Institutions		7,728,585		331,990		3,462		-		(194,989)			7,869,048
Notes Issued		4,488,602		9,481,509		-		-		(231,045)			13,739,066
Current Income Tax Liabilities		1,801,243		804,444		176,169		289,832		-			3,071,688
Subordinated Notes		4,828,018		-		-		-		-			4,828,018
Provisions		450,598		48,263		55,797		52,797		-			607,455
Deferred Income Tax Liabilities		630,211		-		-		60,832		-			691,043
Other Non-financial Liabilities		9,856,683		1,402,893		1,091,565		1,115,025		(75,939)			13,390,227
TOTAL LIABILITIES		253,614,822		28,601,708		1,326,993		1,521,474		(946,444	)		284,118,357

95

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

	Banks		Regional Credit Cards		Insurance		Others		Adjustments			Total as of 01.01.17
ASSETS
Cash and Bank Deposits		65,404,369		461,148		65,025		89,699		(252,676)			65,767,565
Fair Value Debt Securities with Changes to Income		15,138,269		51,370		1,037,773		92,055		(29,903)			16,289,564
Derivative Instruments		124,521		-		-		-		-			124,521
Other Financial Assets		1,723,494		2,040,428		658,470		332,832		(1,117,253)			3,637,971
Loans and Other Financing Activities		106,322,127		27,078,374		22,035		1,325,056		(865,316)			133,882,276
Other Debt Securities		872,431		3,749		207,209		585,260		(706,686)			961,963
Financial Assets Pledged as Collateral		5,357,096		121,664		-		94		-			5,478,854
Current Income Tax Assets		2,153		20,888		-		103,074		-			126,115
Investments in Equity Instruments		68,363		-		-		33,200		-			101,563
Investments in Subsidiaries, Associates and Joint Ventures		5,145,327		-		14,716		23,368,493		(28,372,867)			155,669
Property, Plant and Equipment		7,755,542		606,008		147,385		22,616		-			8,531,551
Intangible Assets		602,130		194,254		33,310		1,410		-			831,104
Deferred Income Tax Assets		-		582,137		(18,725)		-		-			563,412
Other Non-financial Assets		1,172,441		246,175		101,154		111,198		508,727			2,252,995
Non-current Assets Held for Sale		5,749,267		-		-		176,816		-			5,926,083
TOTAL ASSETS		215,550,830		31,406,195		2,268,352		26,241,803		(30,835,974)			244,631,206
LIABILITIES
Deposits		150,639,153		-		-		-		(262,088)			150,377,065
Derivative Instruments		143,373		118,223		-		5,046		(109,043)			157,599
Repo Transactions		1,644,715		-		-		-		-			1,644,715
Other Financial Liabilities		17,079,592		13,743,887		-		732,596		(256,779)			31,299,292
Loans from the Argentine Central Bank and Other Financial Institutions		4,693,232		2,378,628		7,028		228,047		(410,618)			6,896,317
Notes Issued		4,738,931		7,336,619		-		518,748		(736,580)			11,857,718
Current Income Tax Liabilities		990,143		505,315		250,194		76,497		-			1,822,149
Subordinated Notes		4,065,255		-		-		-		-			4,065,255
Provisions		253,904		48,540		29,333		53,099		-			384,876
Deferred Income Tax Liabilities		877,963		-		-		60,306		-			938,269
Other Non-financial Liabilities		8,344,642		1,191,921		912,615		245,496		(121,813)			10,572,861
TOTAL LIABILITIES		193,470,903		25,323,133		1,199,170		1,919,831		(1,896,921	)		220,016,116

20.        DIVIDENDS PER SHARE

Dividends paid in fiscal year 2017 to the Group’s shareholders amounted to $240,000, accounting for $0.18 (figure stated in Pesos) per share.

21.        CORPORATE RISKS AND GOVERNANCE

The tasks related to risk information and internal control of each of the companies controlled by the Company are defined and carried out rigorously.

Apart from applicable local regulations, the Company, in its capacity as a listed company in the United States of America, complies with the certification of its internal controls pursuant to Section 404 of the Sarbanes Oxley Act (Sarbanes Oxley). Corporate risk management is monitored by the Audit Committee, which also gathers and analyzes the information submitted by the main controlled companies.

With regard to potential risks, the Bank embraces a policy that takes into consideration several aspects of the business and operations, abiding by the main guidelines of internationally accepted standards.

From this approach, the Bank defines its internal structure, functions and roles by hierarchical levels and invests resources in monitoring and streamlining risk management, with independence of duties as it reports to the General Manager.

The specific function of the comprehensive management of the Bank’s risks has been allocated to the Risk Division, guaranteeing its independence from the rest of the business areas since it directly reports to the Bank’s General Division and, at the same time, is involved in the decisions made by each area. In addition, the control and prevention of risks related to asset laundering, funding of terrorist activities and other illegal activities are allocated to the Prevention of Asset Laundering Division, which reports to the Board of Directors. The aim of both divisions is to guarantee the Board of Directors is fully aware of the risks that the Bank is exposed to, and to design and propose policies and procedures necessary to identify, assess, follow up, control and mitigate such risks.

96

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

The Bank has developed the Capital Adequacy Assessment Process (“Proceso de Evaluación de Suficiencia de Capital – PESC”, or, as reflected in the Capital Adequacy Report, “IAC”, as per its acronym in Spanish) to assess the relationship between the Bank’s own resources available and the necessary resources to maintain an appropriate risk profile. This process also allows for the identification of both economic capital needs and the sources required to meet such needs.

The minimum capital requirement with regard to each risk is determined according to the Argentine Central Bank regulations.

In addition, the Bank has specified a risk appetite framework, which has certain risk acceptance levels, both on an individual and a consolidated basis. Within this framework, metrics have been established —calculated based on current and stress ratios— which are monitored in order to detect situations that may affect the normal course of business, the noncompliance with the strategy and undesired results and/or situations of vulnerability in the face of changes in market conditions. The Risk and Capital Allocation Committee considers and controls the Bank’s risk profile through a risk appetite report and defines the actions to be carried out in case of potential deviations from the thresholds set.

Financial Risk Factors

Short- and medium-term financial risks are managed within the framework of policies approved by the Board of Directors, which establishes limits to the different risk exposure and also considers their interrelation. Management is supplemented by “contingency plans” devised to face adverse market situations.

Furthermore, “stress tests” that make it possible to assess risk exposure under historical and simulated scenarios are created, which identify critical levels of the different risk factors.

a) Credit Risk:

The Bank uses credit assessment and risk monitoring tools to allow its management on a prompt and controlled basis to control its level of exposure to potential risks and encourages a proper portfolio diversification, both in individual terms and by economic sector.

Strategically, the Bank has decided to deepen its customers’ knowledge expressed in a specific policy, which allows the Bank to credit assistance to its customers according to their financing needs and based on their evaluated attributes, purposes and perspectives.

The Bank’s credit granting and analysis system is applied in a centralized manner and is based on the concept of “opposition of interests”, with specific duties concerning risk, credit, and commercial management for the several business areas.

This allows for an ongoing and efficient monitoring of the quality of assets, an early management of problem loans, aggressive write-offs of uncollectible loans, and a conservative policy on allowances for loan losses.

The credit quality of Government Securities, Private Securities and Lebacs is shown as follows, while the credit quality of loans granted is detailed in Schedule B.

Rating	12.31.17
Government Securities (Excluding Lebacs)
Fair Value with Changes in Profit or Loss
AAA		6,071,393
AA+		682,798
AA-		65,282
A+		67,318
A3		189,143
BBB		748
BB-		873,328
B		10,315
B2		138,205
Baa1		135,966
Baa2		16,350
Baa3		1,200,500
Total		9,451,346

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GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Private Securities
Fair Value with Changes in Profit or Loss
AAA	280,619
AA+	83,043
AA	578,985
AA-	369,607
Aa2	38,534
Aa3	9,034
A+	127,772
A	87,122
A1	14,532
A2	2,562
A-	37,745
BBB+	3,036
BBB	1,020
Baa1	10,775
B2	3,622
B-	20,122
Total	1,668,130

Impairment of Financial Instruments

The Group accounts for loans according to the type of loan portfolio, by performing an individual analysis of each customer within the “Commercial Loan Portfolio” or “Consumer Comparable Loan Portfolio, ” and a massive analysis based on days in arrears for customers within the “Consumer Loan Portfolio.” The criteria followed by the Group in setting up allowances are detailed in Note 1.

Loans classified as uncollectible for 7 months are eliminated from the Group’s assets and are recognized in off-balance sheet items.

The impact of allowances on net income (loss) as of the dates indicated below is detailed below:

	12.31.17		01.01.17.
Allowances for Consumer Loan Portfolio		3,254,499		2,264,529
Allowances for Commercial Loan and Comparable Loan Portfolio		519,217		251,284
Total		3,773,716		2,515,813

According to the guidelines followed by the Group to set up allowances, loans to the financial sector and performing liabilities should not result in impairment losses.

b) Market Risk:

Trading of and/or investment in government and private securities, currencies, derivatives and debt instruments issued by the Argentine Central Bank, which are listed in capital markets and the value of which varies pursuant to the variation of the market prices thereof, are included within the policy which limits the maximum authorized losses during a year.

The “price risk” (market) is managed on a daily basis according to the approved strategy, the purpose of which is to keep the Bank present in the different derivatives, variable- and fixed-income markets, while obtaining the maximum possible return on trading, without exposing the latter to excessive risk levels. Finally, the designed policy contributes to providing transparency and facilitates the perception of the risk levels to which it is exposed.

In order to measure and monitor risks derived from the variation in the price of financial instruments that form the trading securities portfolio, a model known as “Value at Risk” (also known as “VaR”) is used. This model determines, for the Bank individually, the possible loss that could be generated by the positions in securities, derivative instruments and currencies under the following parameters.

99% Confidence Level: Holding period as per the depth of market at each time and estimated volatility based on the history of the last 252 sessions.

The following table shows a sensitivity analysis of income (loss) and shareholders’ equity to reasonable changes in the preceding exchange rates relative to the Group’s functional currency.

98

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

In 2017, the Group assigned a holding period to each instrument based on depth of market (previously, the time horizon was 10 sessions for all trading activities).

The Group’s exposure to the foreign exchange risk as of year-end by type of currency is shown below:

Currency	Balances as of 12.31.17
	Monetary Financial Assets		Monetary Financial Liabilities			Derivative Instruments			Net Position
U.S. Dollar		85,602		(81,386	)		(2,814	)		1,402
Euro		537		(141	)		-			396
Canadian Dollar		20		(4	)		-			16
Real		12		-			-			12
Swiss Franc		11		(6	)		-			5
Others		22		-			-			22
Total		86,204		(81,537	)		(2,814	)		1,853

Currency	Balances as of 01.01.17
	Monetary Financial Assets		Monetary Financial Liabilities			Derivative Instruments		Net Position
U.S. Dollar		63,563		(65,305	)		3,474		1,732
Euro		285		(119	)		-		165
Canadian Dollar		12		(4	)		-		9
Real		21		-			-		21
Swiss Franc		9		(2	)		-		6
Others		28		(1	)		-		27
Total		63,918		(65,431	)		3,474		1,960

Currency				Balances as of 12.31.17					Balances as of 01.01.17
	Change			Income (Loss)			Shareholders’ Equity		Income (Loss)			Shareholders’ Equity
U.S. Dollar		10	%		140			1,542		173			1,905
		-10	%		(140	)		1,262		(173	)		1,559
Euro		10	%		40			436		17			182
		-10	%		(40	)		357		(17	)		149
Canadian Dollar		10	%		2			18		1			9
		-10	%		(2	)		14		(1	)		8
Real		10	%		1			14		2			23
		-10	%		(1	)		11		(2	)		19
Swiss Franc		10	%		-			5		1			7
		-10	%		-			4		(1	)		6
Others		10	%		2			24		3			30
		-10	%		(2	)		20		(3	)		24

c)     Interest Rate Risk

The Bank’s exposure to the “interest rate risk”, as a result of interest rate fluctuations and the different sensitivity of assets and liabilities, is managed according to the approved strategy. On the one hand, it considers a short-term horizon, seeking to keep the net financial margin within the levels set by the policy. On the other hand, it considers a long-term horizon, the purpose of which is to mitigate the negative impact on the present value of the Bank’s shareholders’ equity in the face of changes in interest rates.

From a comprehensive viewpoint of risk exposure and contributing to including a “risk premium” in the pricing process, the aim is to systematically estimate the “economic capital” used up by the structural risk as per the financial statements (the “interest rate risk”) and the contribution of the “price risk”, in its different expressions, in using up the capital.

The Group’s exposure to the interest rate risk is detailed below. This table shows the residual value of assets and liabilities, classified by the sooner of the interest renegotiation date or the maturity date.

99

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Assets and Liabilities at Variable	Term (in Days)											Total
Rate	Up to 30			30 to 90		90 to 180		180 to 365		Over 365
As of 01.01.17
Total Financial Assets		73,846,356			27,467,682		20,228,823		21,514,578		77,047,533		220,104,972
Total Financial Liabilities		110,337,918			19,156,631		6,111,272		3,302,279		69,101,557		208,009,657
Net Amount		(36,491,562	)		8,311,051		14,117,551		18,212,299		7,945,976		12,095,315
As of 12.31.17
Total Financial Assets		117,479,410			33,891,057		27,115,814		29,825,596		100,217,105		308,528,982
Total Financial Liabilities		143,515,844			21,611,612		5,899,377		5,448,117		93,820,191		270,295,141
Net Amount		(26,036,434	)		12,279,445		21,216,437		24,377,479		6,396,914		38,233,841

The table below shows the sensitivity to potential additional changes in interest rates in the next fiscal year, taking into account the breakdown as of December 31, 2017. The percentage change budgeted by the Group for the fiscal year 2017 was determined considering 100 bps and changes that are considered reasonably possible on the basis of an observation of market conditions:

	Additional Changes to the     Interest Rate	Increase/(Decrease) in Income   before Income Tax in Pesos			Increase/(Decrease) in   Shareholders’ Equity in Pesos
Decrease in Interest Rate	-100 bps		17,862		+0.1%
Increase in Interest Rate	+100 bps		(17,862	)	-0.1%

d. Liquidity Risk

Daily liquidity is managed according to the set strategy, which seeks to maintain adequate liquid resources to mitigate the adverse effects caused by irregular variations in loans and deposits, in addition to coping with “stress” situations.

The current liquidity policy provides for the setting of limits and monitoring of a) liquidity as it relates to stock, for which a level of “Management Liquidity Requirement” was established as the excess over legal minimum cash requirements, taking into consideration the characteristics and behavior of the Group’s different liabilities, and the liquid assets that make up such liquidity; and b) cash flow liquidity, for which gaps between the contractual maturities of consolidated financial assets and liabilities are analyzed and monitored. There is a cap for the gap between maturities, determined based on the gap accumulated against total liabilities permanently complied with during the first year.

Furthermore, the policy sets forth a contingency plan, by currency type, that determines the steps to be taken and the assets from which additional liquid resources can be obtained.

With the purpose of mitigating the liquidity risk that arises from deposit concentration per customer, the Bank has a policy that regulates the concentration of deposits among the main customers.

The table below shows an analysis of maturity of assets and liabilities, based on the period remaining on the contractual maturity dates, as of December 31, 2017, and others, and on undiscounted cash flows:

	Less than 1     Month		1 to 6     Months		6 to 12     Months		12 Months     to 5 Years		More than 5     Years		Total
Assets
Fair Value Debt Securities with Changes to Income		27,593,320		638,163		245,217		1,337,602		163,040		29,977,342
Derivative Instruments		537,000		-		-		-		-		537,000
Repo Transactions		9,894,218		-		-		-		-		9,894,218
Other Financial Assets		7,008,013		25,085		1,941		19,094		3,708		7,057,841
Loans and Other Financing Activities		67,907,606		68,695,134		34,585,090		46,897,259		5,231,050		223,316,139
Other Debt Securities		2,678,026		8,843		901		20,882		-		2,708,652
Financial Assets Pledged as Collateral		6,330,557		-		-		-		-		6,330,557
Liabilities
Deposits		182,095,623		16,506,727		4,274,906		82,491		9		202,959,756
Derivative Instruments		573,218		-		-		-		-		573,218
Repo Transactions		1,156,832		-		-		-		-		1,156,832
Other Financial Liabilities		31,437,463		7,849,672		92		-		-		39,287,227
Loans from the Argentine Central Bank and Other Financial Institutions		5,152,272		471,194		388,222		2,147,084		239,317		8,393,089
Notes Issued		562,883		1,762,474		915,472		14,422,262		-		17,663,091
Subordinated Notes		174,248		189,568		193,254		1,537,606		6,414,645		8,509,321

100

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

22.      CAPITAL MANAGEMENT

The Group has the following goals concerning capital management:

- Complying with the requirements set forth by the Argentine Central Bank in Communiqué “A” 6260, as amended; and

- Supporting the Bank’s operations to prevent potential situations that may endanger its operations.

The Bank’s senior management is responsible for monitoring, overseeing, adjusting and ensuring compliance with its stated goals concerning capital management.

According to the guidelines set out by the Argentine Central Bank, financial institutions are required to maintain capital ratios to mitigate the associated risks. As of December 31, 2017, the Bank complied with the minimum capital requirement established by the Argentine Central Bank regulations.

Computable Regulatory Capital (R.P.C., as per the initials in Spanish) core capital and supplementary capital. The balances of such items as of December 31, 2017 were as follows:

	12.31.17
Core Capital		22,581,424
Tier 1 Common Capital		26,244,839
(Deductible Items)		(3,663,415)
Additional Tier 1 Capital		—
Supplementary Capital		6,947,945
Tier 2 Capital		6,947,945
(Deductible Items)		—
Computable Regulatory Capital (R.P.C.)		29,529,369

The breakdown of the minimum capital requirement determined for the Group is shown below:

	12.31.17
Credit Risk		17,263,077
Market Risk		1,126,159
Operational Risk		4,220,503
Minimum Capital Requirement		22,609,739
Paid-in		29,529,369
Excess		6,919,630

Financial Risks

Short- and medium-term financial risks are managed within the framework of policies approved by the Board of Directors, which establishes limits to the different risk exposure and also considers their interrelation. Management is supplemented by “contingency plans” devised to face adverse market situations. Furthermore, “stress tests” that make it possible to assess risk exposure under historical and simulated scenarios are created, which identify critical levels of the different risk factors.

Cross Border Risk

The Group’s foreign trade transactions and management of “treasury” resources imply assuming cross-border risk positions. These exposures related to cross-border assets are in line with the Bank’s business and financial strategy, the purpose of which is to provide customers with efficient commercial assistance and to improve the management of available liquid resources within an appropriate risk and yield environment.

Transfer Risk

The possibility of diversifying funding sources, as contemplated by the liquidity strategy, by obtaining resources in foreign capital markets, involves the possible exposure to potential regulatory changes that hinder or increase the cost of the transfer of foreign currency abroad to meet liability commitments. The policy that manages the risk of transferring foreign currency abroad thus contributes to the liquidity strategy and pursues the goal of reaching an adequate balance between liabilities payable to local counterparties and those payable to foreign counterparties in a return-risk proportion that is adequate for the Bank’s business and growth.

101

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Exposure to the Non-financial Public Sector

With the purpose of regulating risk exposure with regard to the non-financial public sector, the Bank defined a policy which by design envisages risk exposure in the national, provincial and municipal jurisdictions, and set the limits on the direct and total assistance for each of those jurisdictions.

Operational and IT Risk

In line with best practices and the guidelines set out by the Argentine Central Bank, the Bank has a management framework in place that embraces policies, practices, procedures and structures for the appropriate management of this risk. Operational risk is the risk of losses due to the lack of conformity or due to failure of internal processes, the acts of people or systems, or due to external events. It includes legal risk, but does not include strategic and reputational risks.

The Bank manages the operational and IT risks inherent to its products, activities and business processes. It also manages the risk associated with the material information systems, technology and information security processes. IT risk is the business risk associated with the use, ownership, operation, involvement, influence and/or adoption of IT solutions at the Bank. To this end, business, IT and information security processes are reviewed. Finally, the Bank manages risks derived from subcontracted activities and from services rendered by providers.

Furthermore, before launching or introducing new products, activities, processes or systems, their associated risks are properly assessed.

This way, the Bank has the necessary structure and resources to be able to determine the operational and IT risk profile and thus take the corresponding corrective measures, complying with the regulations set forth by the Argentine Central Bank on guidelines for operational and IT risk management in financial institutions and operational risk events database.

An appropriate management of operational and IT risks also helps improve our customer service quality.

In compliance with Communiqué “A” 5398, securitization, concentration, reputational and strategic risks were identified as significant risks, and a computation and measurement method was developed. These risks, together with those mentioned previously, were included in the Capital Adequacy Assessment Report (I.A.C., as per its acronym in Spanish), within the framework of Communiqué “A” 5515.

Securitization Risk

Securitization is an alternative source of financing and a mechanism for the transfer of risks to investors. Notwithstanding the foregoing, securitization activities and the fast innovation with regard to the techniques and instruments used in such activities also generate new risks, including the following:

i. Credit, market, liquidity, concentration, legal and reputational risks, due to the securitization positions held or invested, including, among others, liquidity facilities and credit enhancements granted; and

ii. Credit risk due to the underlying exposures with regard to securitization.

Concentration Risk

Risk concentration has to do with exposure or groups of exposures with similar characteristics, for instance when they belong to the same debtor, business, product or economic sector, with the possibility of generating:

i. Losses with regard to income, regulatory capital, assets or the global risk level, that are significant enough to affect the financial strength of the financial institution or the ability to keep the financial institution’s main transactions; and

ii. A major change in the Bank’s risk profile.

Reputational Risk

Reputational risk is defined as the risk associated with a negative perception of the financial institution by customers, counterparties, shareholders, investors, account holders, market analysts and other significant market players, which adversely affects the financial institution’s ability to keep existing business relationships or establish new relationships, and its continued access to funding sources such as the interbank market or the securitization market.

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GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Strategic Risk

Strategic risk is that which arises from an inappropriate business strategy or an adverse change in forecasts, parameters, goals and other functions that support such strategy. Even though estimating this risk is complex, institutions must develop new management techniques that include all related aspects.

Asset Laundering Risk

As regards the control and prevention of asset laundering and funding of terrorist activities, the Bank complies with the regulations set forth by the Argentine Central Bank, the Financial Information Unit and Law No. 25246, as amended, which creates the Financial Information Unit (U.I.F.), within the purview of Argentina’s Ministry of Treasury and Public Finance with functional autarchy. The Financial Information Unit is in charge of analyzing, addressing and reporting the information received, in order to prevent and avoid both asset laundering and funding of terrorist activities.

The Bank has promoted the implementation of measures designed to fight against the use of the international financial system by criminal organizations. For such purposes, the Bank has control policies, procedures and structures that are applied using a “risk-based approach”, which allow for the monitoring of transactions, pursuant to the “customer profile” (defined individually based on the information and documentation related to the economic and financial condition of the customer), in order to detect such transactions that should be considered unusual, and to report them to the U.I.F. in applicable cases. The Anti-Money Laundering Management Division (“PLA”, as per its initials in Spanish) is in charge of managing this activity, through the implementation of control and prevention procedures as well as the communication thereof to the rest of the organization by drafting the related handbooks and training all employees. In addition, the management of this risk is regularly reviewed by Internal Audit.

The Bank has appointed a director as a compliance officer, pursuant to Resolution 121/11, as amended, issued by the U.I.F., who shall be responsible for ensuring compliance with and implementation of the proceedings and obligations on the issue.

The Bank contributes to the prevention and mitigation of risks from these transaction-related criminal behaviors, by being involved in the international regulatory standards adoption process.

In compliance with Communiqué A” 5394, as amended, issued by the Argentine Central Bank, the Bank publishes a document entitled “Disciplina de Mercado” on its website (http://www.bancogalicia.com.ar) on a quarterly basis. The document contains information related to the structure and adequacy of regulatory capital, the exposure to the different risks and the management thereof.

103

GRUPO FINANCIERO GALICIA S.A.

INFORMATIVE REVIEW AS OF SEPTEMBER 30, 2018

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

The Company’s purpose is to strengthen its position as a leading company devoted to providing comprehensive financial services and, at the same time, to continue to strengthen the Bank’s position as one of the leading companies in Argentina. This strategy shall be carried out by supplementing the operations and business conducted by the Bank through equity investments in companies and undertakings, either existing or to be created, engaged in financial activities as they are understood in the modern economy.

The income for the period ended September 30, 2018 amounted to $9,920,762. This income has been generated mainly as a consequence of the valuation of equity investments in the Company’s subsidiaries.

At the General Ordinary and Extraordinary Shareholders’ Meeting held on August 15, 2017, the shareholders approved the increase in the Company’s capital stock by means of the issuance of up to 150,000,000 ordinary book-entry Class “B” shares, entitled to one vote per share and with a face value of $1 each and also entitled to dividends on an equal footing with such ordinary book-entry shares outstanding at the time of the issuance, to be offered for public subscription in the country and/or abroad.

On September 26, 2017, once the offering term had elapsed, 109,999,996 new class “B” shares with a face value of $1 and one vote per share were placed, for a subscription price of US $5 (five U.S. Dollars) each.

On September 28, 2017, the capital increase from the primary subscription was fully paid for an aggregate amount of US $549,999.

On October 2, 2017, the international placement agents enforced their over-subscription rights, subscribing 16,500,004 ordinary class “B” shares with a face value of $1 and one vote per share, for a subscription price of US $5 (five U.S. Dollars) each. Payment of the aforementioned over-subscription was made on October 4, 2017, with the Company having received US $82,500. (See Note 16. to the financial statements).

In August 2017, the Company accepted certain irrevocable offers to sell, accounting for 6% of Tarjetas Regionales S.A.’s issued and outstanding shares, for a total price of US$ 49,000.

At the General Extraordinary Shareholders’ Meeting of the Company held on December 14, 2017, the shareholders approved the corporate reorganization process consisting of splitting a portion of the Bank’s shareholders’ equity made up of its shares held in Tarjetas Regionales S.A. representing 77% of its capital stock for its later inclusion in the Company’s shareholders’ equity effective as from January 1, 2018. The final spin-off/merger agreement was signed on January 23, 2018.

On December 27, 2017, the Company, in its capacity as single shareholder and holder of 100% of the Bank’s capital stock, paid a capital contribution with LEBAC (Argentine Central Bank’s bills), I17E8 security, for a face value of 10,168,285,119, which were valued at market price, based on the trading price of $0.98345 as of December 26, 2017 per M.A.E.’s session, totaling $10,000,000. The Argentine Central Bank, through Resolution No. 35 dated January 11, 2018, authorized the capital contribution.

The sale of shares of Compañía Financiera Argentina S.A. took place on February 2, 2018, establishing a total price of $30,771.

At the General Ordinary and Extraordinary Shareholders’ Meeting held on April 24, 2018 the shareholders, pursuant to the rules and regulations in force, agreed to allocate Retained Income as of December 31, 2017, as follows:

- To Legal Reserve	$	25,300
- To Cash Dividends	$	1,200,000
- To Discretionary Reserve for Future Distributions of Profits	$	7,104,168

104

GRUPO FINANCIERO GALICIA S.A.

INFORMATIVE REVIEW AS OF SEPTEMBER 30, 2018

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

FINANCIAL STRUCTURE – MAIN ACCOUNTS OF THE CONSOLIDATED BALANCE SHEET

Items	09.30.18		09.30.17
Assets
Cash and Bank Deposits		116,815,471		35,372,878
Fair Value Debt Securities with Changes to Income		22,562,575		33,645,867
Derivative Instruments		3,832,409		250,946
Repo Transactions		14,145,620		2,035,898
Other Financial Assets		22,503,073		5,176,900
Loans and Other Financing Activities		293,939,831		168,631,227
Other Debt Securities		15,865,750		1,396,634
Financial Assets Pledged as Collateral		9,338,469		5,508,326
Current Income Tax Assets		1,938,429		533,086
Investments in Equity Instruments		132,032		63,963
Investments in Subsidiaries, Associates and Joint Ventures		-		191,945
Property, Plant and Equipment and Intangible Assets		10,522,492		9,180,355
Intangible Assets		1,111,815		779,165
Deferred Income Tax Assets		788,719		596,339
Other Assets		4,060,985		2,782,684
Non-current Assets Held for Sale		243,563		5,676,083
Total Assets		517,801,233		271,822,296
Liabilities
Deposits		320,052,389		162,181,795
Fair Value Liabilities with Changes to Income		385,031		-
Derivative Instruments		6,624,894		215,066
Repo Transactions		-		990,068
Other Financial Liabilities		57,955,861		28,029,801
Loans from the Argentine Central Bank and Other Financial Institutions		26,456,749		6,828,272
Notes Issued		26,794,259		13,557,504
Current Income Tax Liabilities		4,798,850		2,586,103
Subordinated Notes		10,356,588		4,360,056
Provisions		1,481,374		446,621
Deferred Income Tax Liabilities		113,522		1,051,451
Other Liabilities		10,618,068		12,879,050
Total Liabilities		465,637,585		233,125,787
Shareholders’ Equity Attributable to the Controlling Company’s Shareholders		50,438,762		36,930,399
Shareholders’ Equity Attributable to Non-controlling Interests		1,724,886		1,766,110
Total Shareholders’ Equity		52,163,648		38,696,509

INCOME STATEMENT – MAIN ACCOUNTS OF THE CONSOLIDATED INCOME STATEMENT

	09.30.18			09.30.17
Net Income from Interest		20,657,103			13,759,219
Net Commission Income		13,072,817			10,247,606
Other Financial Income		10,387,118			4,979,007
Other Operating Income		5,335,795			3,451,034
Underwriting Income		1,879,264			1,649,910
Loan Loss Provisions		(6,839,254	)		(3,316,891	)
Net Operating Income		44,492,843			30,769,885
Employee Benefits		(9,711,100	)		(7,686,507	)
Administrative Expenses		(10,112,250	)		(7,025,218	)
Depreciation and Impairment of Assets		(832,825	)		(777,254	)
Other Operating Expenses		(8,990,815	)		(5,696,013	)
Operating Income		14,845,853			9,584,893
Income for Associates and Joint Ventures		-			181,440
Income before Taxes from Continuing Activities		14,845,853			9,766,333
Income Tax from Continuing Activities		(4,532,101	)		(3,344,700	)
Net Income from Continuing Activities		10,313,752			6,421,633
Income (Loss) from Discontinued Operations		74,776			-
Income Tax from Discontinued Activities		(22,882	)		(185,362	)
Net Income for the Period		10,365,646			6,236,271
Other Comprehensive Income		(78,451	)		(276,843	)
Total Comprehensive Income, Net		10,287,195			5,959,428
Net Income for the Period Attributable to the Controlling Company’s Shareholders		9,920,762			5,502,737
Net Income for the Period Attributable to Non-controlling Interests		366,433			456,691

105

GRUPO FINANCIERO GALICIA S.A.

INFORMATIVE REVIEW AS OF SEPTEMBER 30, 2018

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

STRUCTURE OF THE CONSOLIDATED STATEMENT OF CASH FLOWS

	09.30.18			09.30.17
Total Operating Activities Cash Flow		10,274,049			(19,484,678	)
Total Investment Activities Cash Flow		(2,011,155	)		(1,052,320	)
Total Financing Activities Cash Flow		13,253,674			8,318,913
Effect of Changes in the Exchange Rate		41,871,798			2,453,412
Total Funds Provided/(Used)		63,388,366			(9,764,673	)

RATIOS

LIQUIDITY

Since the consolidated accounts mainly stem from the Bank, the individual liquidity ratio for the Bank is detailed as follows:

	09.30.18		09.30.17
Liquid Assets(*) as a Percentage of Transactional Deposits		76.38		61.54
Liquid Assets(*) as a Percentage of Total Deposits		49.09		38.78

(*) Liquid Assets include cash and bank deposits, government securities, call money, overnight placements, repo transactions and special guarantee accounts.

SOLVENCY

	09.30.18		09.30.17
Solvency		11.20		16.60

CAPITAL ASSETS

	09.30.18		09.30.17
Capital Assets(*)		2.25		3.73

(*) Investments in Subsidiaries, Associates and Joint Ventures plus Property, Plant and Equipment plus Intangible Assets over Total Assets

PROFITABILITY

	09.30.18		09.30.17
Return on Average Assets(*)		3.72		3.42
Return on Average Shareholders’ Equity(*)		34.63		29.53

(*) Annualized.

EQUITY INVESTMENTS

BANCO DE GALICIA Y BUENOS AIRES S.A.U.

Founded in 1905, the Bank is one of the largest private-sector banks in the Argentine financial system, and one of the leading providers of financial services in the country.

As a universal bank with a variety of distribution channels, the Bank offers a full spectrum of financial services to customers, both individual and corporate. The Bank also operates one of the most extensive and diversified distribution networks in the Argentine private financial sector, offering 319 branches.

In comparing the consolidated results of operations for the second quarter of 2018 to the same period the previous year, consideration should be given to the fact that the Company and the Bank entered into a spin-off/merger agreement, pursuant to which the Bank split from its shareholders’ equity its 77% interest in Tarjetas Regionales S.A. for its later inclusion in the Company’s shareholders’ equity, effective as from January 1, 2018. Accordingly, the income statement as of September 30, 2017 unconsolidated with Tarjetas Regionales S.A., Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A. was also included for increased consistency in analyzing the changes. Such equity investments are disclosed in the “Investments in Subsidiaries, Associates and Joint Ventures” line. The tables related to activity level, additional information, ratios, profitability, efficiency and capitalization also disclose balances as of September 30, 2017, unconsolidated with Tarjetas Regionales S.A., Compañía Financiera Argentina S.A. and Cobranzas y Servicios S.A.

During the third quarter of 2018, the Bank recorded comprehensive income in the aggregate amount of $7,261,004, $2,281,114 higher than that recorded during the third quarter of the previous fiscal year, representing a 46% increase. The increase in comprehensive income, as compared to the third quarter of 2017, was mainly attributable to an increase of $11,100,472 in net operating income (net income from interest plus net commission income, plus other financial income, plus other operating income less loan loss provisions). This effect was mainly offset by increases in: i) employee benefits, ii) administrative expenses of $3,427,176, and iii) other operating expenses of $2,864,188.

106

GRUPO FINANCIERO GALICIA S.A.

INFORMATIVE REVIEW AS OF SEPTEMBER 30, 2018

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Net operating income for the fiscal year 2018 amounted to $31,041,260, a 56% increase as compared to the $19,940,788 recorded in the previous fiscal year. This positive evolution was due to an increase in net income from: i) net income from interest (amounting to $14,624,458, or 58%), as a result of the increase in the volumes traded during the period, in addition to an increase in the financial margin; ii) net commission income (amounting to $7,269,513, or 30%), the most outstanding of which are commissions on credit cards and deposit accounts. Administrative expenses plus employee benefits totaled $12,678,549, with a 37% increase. Loan loss provisions amounted to $4,455,512, 149% higher than those recorded in the previous fiscal year, mainly as a result of the evolution of the arrears related to the individual’s portfolio and higher regulatory charges on the regular portfolio as a result of the increase in the volume of receivables.

Total loans to the private sector amounted to $299,400,757, showing an 87% increase during the last twelve months, and total deposits reached $320,367,360, growing 97% when compared to the same period of the previous fiscal year. As of September 30, 2018, the Bank’s estimated share in loans to the private sector was 10.58%, while in deposits from the private sector was 10.99%, when compared to 9.31% and 9.37%, respectively, for the same quarter of the previous fiscal year.

SUDAMERICANA HOLDING S.A.

Sudamericana Holding S.A. is a holding company providing life, retirement, property, and casualty insurance and insurance brokerage services. The equity interest held by the Company in Sudamericana Holding S.A. is 87.50%. The Bank holds the remaining 12.50% equity interest.

This investment represents another step forward in the Company’s plan to consolidate its leadership as a financial services provider.

Joint production of the insurance companies controlled by Sudamericana Holding S.A. in the life, retirement and property insurance business amounted to $2,749,928 during the period commenced on January 1, 2018 and ended on September 30, 2018. As of September 30, 2018, these companies had approximately 3 million policies/certificates in their insurance lines.

From a commercial standpoint, within a more challenging context with respect to the industry in general, the company maintains its focus on taking advantage of greater demand for insurance coverage to significantly increase sales.

As a result of this effort, the premium volume for the third quarter of 2018 exceeded that for the same period of the previous year by 17.7%.

GALICIA WARRANTS S.A.

Galicia Warrants S.A. was established in 1993 and, since then, has become a leading company. It renders services to the productive sector as an additional credit instrument, also rendering a full spectrum of services related to inventory management.

Its shareholders are the Company, which holds an 87.5% equity interest, and the Bank, which holds a 12.5% equity interest.

Galicia Warrants S.A. has its corporate headquarters in Buenos Aires and an office in the city of San Miguel de Tucumán, through which it carries out its transactions in the warrants market as well as other services related to its main activity, for different regional economies and geographic areas of the country.

Based on the experience and understanding of the warrant as a security instrument in the financial market, the company established a policy to spread the quality of the service provided and improve it through the certification of ISO 9001 Standards; its main focus is the improvement of merchandise, storage and custody, and marketing processes.

As of September 30, 2018, the amount of deposit certificates and warrants issued was $2,859,878, which pertains to merchandise under custody located in different productive regions throughout the country, whereas income from services amounted to $72,410.

107

GRUPO FINANCIERO GALICIA S.A.

INFORMATIVE REVIEW AS OF SEPTEMBER 30, 2018

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Galicia Warrants S.A. continues to operate with the purpose of rendering the best quality and most reliable service for its customers that is best tailored to meet their needs.

GALICIA ADMINISTRADORA DE FONDOS S.A.

Galicia Administradora de Fondos S.A.’s shareholders are the Company, holding 95% of its shares and Galicia Valores S.A., holding the remaining 5%.

Galicia Administradora de Fondos S.A. administers the FIMA mutual funds distributed by the Bank, in its capacity as custodial agent of collective investment products corresponding to mutual funds, through its broad channel network, such as branches, electronic banking, phone banking, and to different customer segments (such as institutional, corporate and individual customers).

The mutual funds invest in a variety of assets, depending on their investment goals (such as government and private securities, equity or time deposits, among others).

As of September 30, 2018, FIMA funds decreased by 14.3%, as compared to the fiscal year ended December 31, 2017. At the end of the third quarter of 2018, the volume of funds managed reached $58,115 million.

TARJETAS REGIONALES S.A.

Tarjetas Regionales S.A. was incorporated as a corporation (sociedad anónima) on September 23, 1997. It is engaged in financial and investment activities, and its core business is maintaining (holding) investments in issuers of non-banking credit cards and companies that deliver supplementary services to such activities.

In 2017, Regional Cards continued consolidating their leading position in the Argentine credit card market. As per official surveys and private market research, Tarjetas Regionales S.A. has a privileged market position, as it is the main credit card issuer at the national level and the leading brand in the Argentine provinces.

As of September 30, 2018, Tarjetas Regionales S.A. posted a profit of $2,155 million, accounting for an 8% increase compared to the same quarter of the previous fiscal year. Net operating income for the quarter amounted to $5,887 million, accounting for a 17% increase in comparison to 2017, while net income from interest and other operating income rose by 30% and 22%, respectively. The loan loss provisions for the quarter amounted to $2,195 million, 41% higher than the $1,306 million recorded in the same quarter of the previous fiscal year.

OUTLOOK

During the third quarter of 2018, and as in the previous months, two major factors affected international markets: i) the commercial tension between US and its main partners (China, European Union, Canada and Mexico) and ii) the monetary policy of the main central banks in the world, particularly, the increase in the reference rate by 25 basis points (b.p.) by the US Federal Reserve, resulting in a reference rate of 2.00 - 2.25%.

In this environment and pursuant to the framework set forth by the International Monetary Fund, Argentina has covered all of its financing needs for the current year. From the foreign exchange standpoint, upward pressures caused by assets abroad and financial divestments in local assets remained the same. In addition, the monetary policy strengthened its contractionary trend and replaced the policy of inflation targets with a scheme of monetary aggregates. In this respect, we expect that the contractionary trend of such policy will continue until inflation expectations show a marked decline from current levels. As regards tax matters, we expect that the previously set goals to be achieved again in 2018.

In the short term, as a result of a drought that affected agricultural production, coupled with volatility in the exchange rate, acceleration in inflation and the current interest rate levels, a moderate contraction in activity levels is expected. Underpinned by the evolution of exports, coupled with a moderate increase in investment and consumption, a slight recovery is expected for the second half of the year, with shrinkage for 2019 as a whole expected.

Within this context, the Group will continue working to strengthen its market leadership position. The Group’s main focus will continue to be on the quality of products and services provided to current and future customers, while continuing to improve operational efficiency as a key factor to generate value for customers and shareholders.

The Group’s business growth is attained within a framework of sustainable management. In that sense, the Group will continue to seek out further opportunities to create value, oriented to the public good and environmentally friendly.

Autonomous City of Buenos Aires, November 27, 2018.

108

GRUPO FINANCIERO GALICIA S.A.

SEPARATE CONDENSED INTERIM BALANCE SHEET

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Items	Notes	09.30.18		12.31.17	01.01.17.
Assets
Cash and Bank Deposits		7,579		3,689	3,044
Cash		19		19	20
Financial Institutions and Correspondents		7,560		3,670	3,024
Other Local and Foreign Financial Institutions		7,560		3,670	3,024
Fair Value Debt Securities with Changes to Income (Schedule A)	4	69,332		1,565,669	138,073
Derivative Instruments		-		11,638	-
Other Financial Assets	4	20,340		74,367	27,732
Loans and Other Financing Activities		699,113		19,713	2,853
To the Non-financial Public Sector		646,765		-	-
To the Non-financial Private Sector and Residents Abroad		52,348		19,713	2,853
Current Income Tax Assets		6,435		5,511	655
Investments in Subsidiaries, Associates and Joint Ventures	5	50,090,659		40,449,657	23,321,585
Property, Plant and Equipment (Schedule F)		1,648		1,827	-
Deferred Income Tax Assets	8	7,274		-	-
Other Non-financial Assets	7	4,132		4,356	29,760
Non-current Assets Held for Sale	7	-		28,965	36,465
Total Assets		50,906,512		42,165,392	23,560,167
Liabilities
Notes Issued		-		-	360,692
Current Income Tax Liabilities	8	34,871		14,941	-
Deferred Income Tax Liabilities	8	-		1,175	-
Other Non-financial Liabilities		13,572		11,969	36,268
Total Liabilities		48,443		28,085	396,960
Shareholders’ Equity
Capital Stock	6	1,426,765		1,426,765	1,300,265
Non-capitalized Contributions		10,951,132		10,951,132	219,596
Capital Adjustments		278,131		278,131	278,131
Profit Reserves		25,444,177		18,314,708	12,536,831
Retained Income		2,819,823		2,526,325	2,526,325
Other Accumulated Comprehensive Income		(61,172	)	17,279	284,182
Net Income for the Period/Year		9,999,213		8,622,967	6,017,877
Total Shareholders’ Equity		50,858,069		42,137,307	23,163,207

The accompanying Notes and Schedules are an integral part of these separate condensed interim financial statements.

109

GRUPO FINANCIERO GALICIA S.A.

SEPARATE CONDENSED INTERIM INCOME STATEMENT

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	Notes	Three-month Period Ended 09.30.18		Three-month Period Ended 09.30.17		Nine-month Period Ended 09.30.18		Nine-month Period Ended 09.30.17
Interest Income	9	109		6		271		12
Interest Expense	9	-		(10,621	)	-		(46,237	)
Net Income from Interest		109		(10,615	)	271		(46,225	)
Net Income from Measurement of Fair Value Financial Instruments with Changes to Income	9	42,057		(46,554	)	134,427		(32,162	)
Exchange Rate Differences on Gold and Foreign Currency		15,110		76,062		46,171		76,147
Other Operating Income	9	(5	)	(4	)	1		10
Loan Loss Provisions		-		-		-		(121	)
Net Operating Income		57,271		18,889		180,870		(2,351	)
Employee Benefits	9	(1,074	)	(722	)	(3,028	)	(27,045	)
Administrative Expenses	9	(21,150	)	(16,509	)	(95,029	)	(45,241	)
Depreciation and Impairment of Assets	9	(59	)	(47	)	(179	)	(64	)
Other Operating Expenses	9	(32	)	(179	)	(513	)	(241	)
Operating Income (Loss)		34,956		1,432		82,121		(74,942	)
Income for Associates and Joint Ventures		4,187,625		2,122,751		9,944,135		5,854,522
Income before Taxes from Continuing Activities		4,222,581		2,124,183		10,026,256		5,779,580
Income Tax from Continuing Activities	8	(10,179	)	-		(27,860	)	-
Net Income from Continuing Activities		4,212,402		2,124,183		9,998,396		5,779,580
Income from Discontinued Operations		2		-		1,806		-
Income Tax from Discontinued Activities	8	-		-		(989	)	-
Net Income for the Period		4,212,404		2,124,183		9,999,213		5,779,580

	Notes	09.30.18	09.30.17
Earnings per Share
Net Earnings Attributable to the Controlling Company’s Shareholders		9,999,213	5,779,580
Plus: Dilutive Effects of Potential Ordinary Shares		-	-
Net Earnings Attributable to the Controlling Company’s Shareholders Adjusted for Dilution		9,999,213	5,779,580
Weighted-Average of Ordinary Shares Outstanding for the Period
Plus: Weighted-Average of Dilutive Additional Ordinary Shares		-	-
Weighted-Average of Ordinary Shares Outstanding for the Period Adjusted for Dilution		1,426,765	1,301,070
Basic Earnings per Share	6.2	7.01	4.44
Diluted Earnings per Share	6.2	7.01	4.44

The accompanying Notes and Schedules are an integral part of these separate condensed interim financial statements.

SEPARATE CONDENSED INTERIM STATEMENT OF OTHER COMPREHENSIVE INCOME

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	Notes	Three-month Period Ended 09.30.18		Three-month Period Ended 09.30.17		Nine-month Period Ended 09.30.18		Nine-month Period Ended 09.30.17
Net Income for the Period		4,212,404		2,124,183		9,999,213		5,779,580
Items of Other Comprehensive Income that will be Reclassified to Profit or Loss for the Period		-		-		-		-
Income (Loss) for the Period attributable to Share of Profit or Loss in OCI of Subsidiaries		(80,936	)	(94,150	)	(78,451	)	(276,843	)
Total Other Comprehensive Income that will be Reclassified to Profit or Loss for the Period		(80,936	)	(94,150	)	(78,451	)	(276,843	)
Total Other Comprehensive Income (Loss)		(80,936	)	(94,150	)	(78,451	)	(276,843	)
Total Comprehensive Income (Loss)		4,131,468		2,030,033		9,920,762		5,502,737

The accompanying Notes and Schedules are an integral part of these separate condensed interim financial statements.

110

GRUPO FINANCIERO GALICIA S.A.

SEPARATE CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Movements	Note	Capital Stock		Non-capitalized Contributions		Adjustments to Shareholders’ Equity		Other Comprehensive Income (Loss)			Profit Reserves				Retained Income					Total Shareholders’ Equity
		Outstanding		Additional Paid-in Capital				Others			Legal Reserve		Others		I.F.R.S. Adjustment		Income
Balances as of 12.31.17 According to the Prior Accounting Framework			1,426,765		10,951,132		278,131		-			315,679		17,999,029		-		8,329,469			39,300,205
Adjustment to IFRS-based Accounting Framework			-		-		-		17,279			-		-		2,526,325		293,498			2,837,102
Balances as of 12.31.17			1,426,765		10,951,132		278,131		17,279			315,679		17,999,029		2,526,325		8,622,967			42,137,307
Distribution of Profits - Reserves			-		-		-		-			25,300		7,104,169		-		(7,129,469	)		-
Distribution of Profits - Dividends			-		-		-		-			-		-		-		(1,200,000	)		(1,200,000	)
Net Income for the Period																					-
Other Comprehensive Income for the 2018 Period			-		-		-		(78,451	)		-		-		-		-			(78,451	)
Net Income for the 2018 Period			-		-		-		-			-		-		-		9,999,213			9,999,213
Balances as of 09.30.18			1,426,765		10,951,132		278,131		(61,172	)		340,979		25,103,198		2,526,325		10,292,711			50,858,069
Balances as of 01.01.17 According to the Prior Accounting Framework			1,300,265		219,596		278,131		-			315,679		12,221,152		-		6,017,877			20,352,700
Adjustments			-		-		-		284,182			-		-		2,526,325		-			2,810,507
Adjusted Balances as of 01.01.17			1,300,265		219,596		278,131		284,182			315,679		12,221,152		2,526,325		6,017,877			23,163,207
Capital Increase			110,000		9,318,595		-		-			-		-		-		-			9,428,595
Distribution of Profits - Reserves			-		-		-		-			-		5,777,877		-		(5,777,877	)		-
Distribution of Profits - Dividends			-		-		-		-			-		-		-		(240,000	)		(240,000	)
Net Income for the Period																					-
Other Comprehensive Income for the 2017 Period			-		-		-		(276,843	)		-		-		-		-			(276,843	)
Net Income for the 2017 Period			-		-		-		-			-		-		-		5,779,580			5,779,580
Balances as of 09.30.17			1,410,265		9,538,191		278,131		7,339			315,679		17,999,029		2,526,325		5,779,580			37,854,539

111

GRUPO FINANCIERO GALICIA S.A.

SEPARATE CONDENSED INTERIM STATEMENT OF CASH FLOWS AND CASH EQUIVALENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Notes	09.30.18	09.30.17
OPERATING ACTIVITIES CASH FLOWS
Net Income for the Period before Income Tax		10,026,256	5,779,580
Adjustment to Obtain the Operating Activities Flows:
Interest Income		(271)	(12)
Interest Expense		-	46,237
Net Income (Loss) from Measurement of Fair Value Financial Instruments with Changes to Income		(134,427)	32,162
Depreciation and Impairment of Assets		179	64
Loan Loss Provisions		-	121
Other Comprehensive Income (Loss) from Associates and Joint Ventures		78,451	276,843
Income (Loss) for Associates and Joint Ventures		(9,944,135)	(5,854,522)
Net Increases/(Decreases) from Operating Assets:
Fair Value Debt Securities with Changes to Income		140,492	-
Derivative Instruments		(13,108)	-
Other Financial Assets		7,043	362,726
Investments in Associates and Joint Ventures		3,290	5,480
Deferred Income Tax Assets		7,274	-
Other Operating Assets		(14,482)	(939,601)
Net Increases/(Decreases) from Operating Liabilities:
Current Income Tax Liabilities		(26,365)	-
Other Operating Liabilities		(1,602)	759
Income Tax Payments		(6,435)	-
TOTAL OPERATING ACTIVITIES (A)		122,160	(290,163)
INVESTMENT ACTIVITIES CASH FLOWS
Payments:
Acquisition of Interests in Associates and Joint Ventures		(924,140)	(907)
Purchase of Property, Plant and Equipment		-	(2,247)
Collections:
Disposal of Interests in Associates and Joint Ventures		28,965	4,121
Winding-up of Associates		248	-
Collection of Dividends		1,151,864	633,758
TOTAL INVESTMENT ACTIVITIES (B)		256,937	634,725
FINANCING ACTIVITIES CASH FLOWS
Payments:
Dividends		(1,200,000)	(240,000)
Unsubordinated Notes		-	(292,305)
Collections:
Capital Increase		-	9,428,595
TOTAL FINANCING ACTIVITIES (C)		(1,200,000)	8,896,290
EFFECT OF CHANGES IN EXCHANGE RATE (D)		(46,171)	(76,147)
INCREASE/(DECREASE) IN CASH, NET (A+B+C+D)		(867,073)	9,164,705
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR		1,663,438	162,825
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD		796,364	9,327,530

112

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

NOTE 1. ACCOUNTING STANDARDS AND BASIS FOR PREPARATION

Grupo Financiero Galicia S.A. (the “Company”) was constituted on September 14, 1999, as financial services holding company organized under the laws of Argentina. The Company’s main asset is its interest in Banco de Galicia y Buenos Aires S.A.U. (the “Bank”). The Bank is a private-sector bank that offers a full spectrum of financial services both to individual and corporate customers. In addition, the Company has a controlling interest in Tarjetas Regionales S.A., which maintains investments related to the issuance of credit cards and supplementary services; Sudamericana Holding S.A., a company engaged in the insurance business; Galicia Administradora de Fondos S.A., a mutual fund manager, and Galicia Warrants S.A., a company engaged in the issuance of warrants.

These separate condensed interim financial statements were approved and authorized for publication through Minutes of Board of Directors’ Meeting No. 574 dated November 27, 2018.

1.1. ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)

In the light of the fact that the Group is subject to the provisions of Article 2 – Section I – Chapter I of Title IV: Periodical Reporting Requirements of the National Securities Commission (“C.N.V.”) regulations, it is required to present its financial statements in accordance with the valuation and disclosure criteria set forth by the Argentine Central Bank. As required by the aforementioned article, we hereby report that:

- The Company’s corporate purpose is exclusively related to financial and investment activities;

- the equity investments in the Bank and Tarjetas Regionales S.A., the latter being subject to the consolidated supervision requirements established by the Argentine Central Bank (Communiqué “A” 2989, as supplemented), account for 94.64% of Company’s assets and are the Company’s main assets;

- 91.15% of the Company’s income is derived from its share of profit in the entities referred to in the preceding paragraph; and

- The Company has a 100% equity interest in the Bank and an 83% equity interest in Tarjetas Regionales S.A., thus having control over both entities.

The Argentine Central Bank, through Communiqué “A” 5541, as amended, sets forth a convergence plan towards the International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and the interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC), addressed to entities under the Argentine Central Bank’s supervision, effective for fiscal years commenced January 1, 2018, except for item 5.5 (Impairment) of IFRS 9 “Financial Instruments”, which has been temporarily waived until January 1, 2020, at which time entities will be required to apply the provisions on Impairment of Financial Assets, and IAS 29 “Financial Reporting in Hyperinflationary Economies” (see Note 1.2.).

Entities are also required to prepare their opening financial statements since January 1, 2017, which will serve as comparative basis to the financial statements commencing on January 1, 2018, with the interim financial statements as of March 31, 2018 being the first interim financial statements prepared under these standards.

The Company’s separate condensed interim financial statements for the nine-month period then ended have been prepared in accordance with IAS 34 “Interim Financial Reporting” and IFRS 1 “First-time Adoption of International Financial Reporting Standards.” The separate condensed interim financial statements have been prepared in accordance with the criteria the Company expects to adopt in preparing its annual consolidated financial statements as of December 31, 2018.

Comparative figures and figures as of the transition date (January 1, 2017) have been modified to reflect the adjustments to the aforementioned accounting framework.

Note 3 presents a reconciliation of the figures disclosed in the balance sheet, income statement, statement of other comprehensive income and statement of cash flows relating the separate condensed interim financial statements issued under the previous accounting framework to the figures disclosed according to the IFRS-based accounting framework in these consolidated condensed interim financial statements, as well as the effects of adjustments to cash flows as of the transition date (January 1, 2017), as of the adoption date (December 31, 2017) and as of the end of the comparative period (September 30, 2017).

113

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

These separate condensed interim financial statements should be read together with the Company’s annual financial statements as of December 31, 2017 prepared in accordance with the accounting framework set out by the Argentine Central Bank. Furthermore, the Note entitled “Additional Information as of December 31, 2017 for the Separate Condensed Interim Financial Statements” included in these financial statements contains certain information under the IFRS-based accounting framework which is required to understand the consolidated condensed interim financial statements.

It has been concluded that these separate condensed interim financial statements fairly present the Group’s financial position, financial performance and cash flows.

1.2. BASIS FOR PREPARATION

These separate condensed interim financial statements have been prepared in accordance with the accounting framework set forth by the Argentine Central Bank described in Note 1.1.

In preparing these separate condensed interim financial statements, the Group is required to make estimates and assessments affecting the reported amounts of assets and liabilities, and contingent assets and liabilities disclosed as of the date of these separate condensed interim financial statements, as well as the reported amounts of income and expenses.

(a) Going Concern

As of the date of these separate condensed interim financial statements, there are no uncertainties as to developments or circumstances that may call into question the likelihood that the Company will continue operating normally as a going concern.

(b) Measurement Unit

The Company’s separate condensed interim financial statements reflect the effects of the changes in the purchasing power of the currency until February 28, 2003, the date on which the adjustment for inflation was discontinued, as required by Decree No. 664/03 of the Argentine National Executive Branch, Section 268 of General Resolution No. 7/2005 of the Corporation Control Authority, Communiqué “A” 3921 of the Argentine Central Bank, and General Resolution No. 441/03 of the C.N.V. Resolution M.D. No. 41/03 of the Professional Council in Economic Sciences of the Autonomous City of Buenos Aires (C.P.C.E.C.A.B.A.) established the discontinuation of the recognition of the changes in the purchasing power of the currency effective October 1, 2003.

IAS 29 “Financial Reporting in Hyperinflationary Economies” requires that the financial statements of an entity whose functional currency is that of a hyperinflationary economy be stated in terms of the current measurement unit as of the reporting period-end, irrespective of whether they are based on the historical cost or the current cost method. Accordingly, inflation occurring since the acquisition date or since the revaluation date, as the case may be, should be accounted for in non-monetary items. These requirements are also applicable to the comparative information reported in the financial statements. According to IAS 29, monetary assets and liabilities are not required to be restated, for they are stated in the current unit of measurement as of the end of the current reporting period. Assets and liabilities subject to adjustments based on specific agreements will be adjusted on the basis of such agreements. Non-monetary items measured at their current values at the end of the reporting period, such as net realizable value or otherwise, will not be restated. Other non-monetary assets and liabilities will be restated by applying a general price index. The income (loss) from the net monetary position will be charged to net income for the reporting period under a separate item.

Based on the foregoing, the Group’s shareholders’ equity and results of operations will differ substantially from currently reported balances if such balances were restated into constant currency as of the date of these financial statements.

In order to conclude whether a given economy qualifies as hyperinflationary pursuant to the terms of IAS 29, the standard sets forth certain factors that should be considered, including a three-year cumulative inflation rate reaching or exceeding 100%.

The downward inflation trend that was observed in the previous year seems to have been reversed, with a substantial increase in inflation occurring during 2018. In addition, the last three years’ cumulative inflation rate is expected to surpass 100%. In addition, all other indicators are consistent with the conclusion that Argentina should be regarded as a hyperinflationary economy for accounting purposes, pursuant to IAS 29.

114

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

In this regard, the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.) issued a release pointing out that, effective since for the fiscal years ending on or after July 1, 2018, entities reporting under IFRS will be required to apply the inflation adjustment since the conditions for such application have been satisfied.

However, it should be noted that, as of the date of these financial statements, the standards promulgated by the Company’s controlling authorities are still in force, according to which entities are not allowed to file information restated into constant currency. Accordingly, as September 30, 2018, the Company has not applied the criteria for the restatement of financial information set forth in IAS 29.

It is noteworthy that the Argentine Senate enacted Bill CD-33/18 on November 15, 2018, which establishes legislative changes related to the abrogation of Decree 664/2003. The provisions of this law will come into force as of the publication date in the Official Gazette and will be applicable to financial statements filed by entities on or after such date, as determined by the Argentine National Executive Branch, through its controlling authorities, and the Argentine Central Bank.

Therefore, in reading and analyzing these financial statements, users should consider the last few years’ cumulative inflation rates and certain macroeconomic variables affecting the Company’s business, including labor costs and prices for supplies.

(c) Changes in Accounting Criteria/New Accounting Standards

As provided for in the Argentine Central Bank’s Organic Charter and the Financial Institutions Law, as new IFRS are approved or amended, or as the IFRS currently in force are repealed, and once these changes are adopted by way of Adoption Circulars handed down by the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.), the Argentine Central Bank will decide whether to approve such changes for financial institutions. In general terms, the early adoption of any given IFRS will not be admitted, unless specifically admitted at the time of adoption.

Below is a detail of the new standards, changes and interpretations which have been published but have not yet been effectuated for the fiscal years commencing on January 1, 2018, and which have not been previously adopted.

IFRS 16 “Leases”: In January 2016, the IASB issued IFRS 16 “Leases” which sets out a new accounting model for leases. Under IFRS 16, a contract is or contains a lease if the contract confers on the lessee a right to control the use of an identified asset for a period of time, for consideration. IFRS 16 requires that the lessee recognize the liability arising from the lease reflecting the future lease payments and a right of use of the assets for substantially all leases, other than certain short-term leases and leases of low-value assets. Lessor accounting is maintained as provided for in IAS 17. However, the new accounting model for lessee is expected to have an impact on negotiations between lessors and lessees. Entities are required to apply IFRS 16 for fiscal years commencing on or after January 1, 2019. The Group is assessing the impact of the adoption of such standard on its financial statements.

IFRS 17 “Insurance Contracts”: On May 18, 2017, the IASB issued IFRS 17 “Insurance Contracts,” establishing a comprehensive accounting framework based on measurement and disclosure principles for insurance contracts. The new standard supersedes IFRS 4 “Insurance Contracts,” and requires that insurance contracts be measured using current fulfillment cash flows and that revenues be recognized as the insurance service is delivered during the term of the coverage. Entities are required to apply IFRS 17 for fiscal years commencing on or after November 1, 2021.

IFRIC 23 “Uncertainty over Income Tax Treatment”: This interpretation clarifies how the recognition and measurement requirements of IAS 12 “Income Tax” should be applied when there is uncertainty over the income tax treatment. IFRIC 23 was published in June 17 and entities will be required to apply it for fiscal years commencing on or after January 1, 2019.

There are no other IFRS or IFRIC interpretations which have not yet come into force and which are expected to have a material impact on the Company.

115

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

1.3. SUBSIDIARIES

Subsidiaries are all such entities over which the Company has control. The Company controls an entity when it is exposed to, or has rights in, variable returns by reason of its involvement with the investee, and has the ability to use its power to direct the entity’s operating and financial policies to affect such returns. Subsidiaries are consolidated as from the time on which control is transferred to the Company, and are excluded from consolidation on the date such control ceases.

Associates are entities over which the Company has significant influence, that is, the power to interfere with the decisions made as to the investee’s financial and operating policies, without exerting control.

Pursuant to IAS 27 and IAS 28, entities are required to recognize investments in subsidiaries and associates in their separate financial statements according to the “equity method.”

When using the equity method, investments are initially recognized at cost and such amount is increased or reduced to recognize the investor’s share of profit or loss of the investee, subsequent to the acquisition or incorporation date. In addition, identifiable net assets and contingent liabilities acquired in the initial investment in a subsidiary and/or associate are originally recognized at fair value as of the investment date. Where applicable, the value of equity interests in subsidiaries and associates includes the goodwill recognized as of such date. When the Company’s share of loss is equal to or higher than the value of the interest in such entities, the Company does not recognize additional losses, except when it has legal or assumed obligations of providing funds or making payments against them.

The share of profit (loss) of subsidiaries and associates is recognized in “Income (Loss) for Associates and Joint Ventures” in the separate condensed interim income statement. The share of profit (loss) of subsidiaries and associates is recognized in “Equity Interests in Associates and Joint Ventures Accounted for under the Equity Method,” in the separate condensed interim statement of other comprehensive income.

As of each reporting date, the Company determines whether objective evidence exists indicating that an investment in a subsidiary or associate is not recoverable. In that case, it quantifies the impairment as the difference between the recoverable value of such investment and its carrying amount, and recognizes the resulting amount in “Income (Loss) for Associates and Joint Ventures” in the separate condensed interim income statement.

1.4. FOREIGN CURRENCY TRANSLATION

(a) Functional Currency and Reporting Currency

The figures disclosed in the separate condensed interim financial statements for each of the Group’s entities are stated in their functional currency, that is, the currency of the main economic environment in which they operate. The separate condensed interim financial statements are stated in Argentine Peso, which is the Company’s functional and reporting currency.

(b) Transactions and Balances

Transactions in foreign currency are translated to functional currency at the exchange rates prevailing on the transaction or valuation dates when items are measured at closing. Gains and losses in foreign currency on the settlement of these transactions and on the translation of monetary assets and liabilities to foreign currency at the exchange rates prevailing at closing are recognized in the income statement under “Exchange Rate Differences on Gold and Foreign Currency,” except when deferred in equity as in the case of qualifying cash flow hedges, where applicable.

Assets and liabilities in foreign currency are measured at the reference exchange rate of the U.S. dollar set by the Argentine Central Bank prevailing at the close of operations on the last working day of each month.

As of September 30, 2018, December 31, 2017, September 30, 2017 and January 1, 2017, balances in U.S. Dollars were converted applying the reference exchange rate ($40.8967, $18.7742, $17.3183 and $15.8502, respectively) set by the Argentine Central Bank. Assets and liabilities valued in foreign currencies other than the U.S. Dollar were converted into the latter currency using swap rates reported by the Argentine Central Bank.

116

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

1.5. CASH AND BANK DEPOSITS

The item “Cash and Bank Deposits” includes cash available, unrestricted deposits held in banks, cash equivalents and other short-term highly-liquid investments with original maturity within three months or less.

The assets disclosed under cash and cash equivalents are accounted for at amortized cost which approximates its fair value.

1.6. FINANCIAL INSTRUMENTS

1.6.1. Initial Recognition

The Company recognizes a financial asset or liability in its separate condensed interim financial statements, as the case may be, when it becomes a party to the financial instrument contract. Purchases and sales are recognized on the trading date on which the Company buys or sells these instruments.

Upon initial recognition, the Company measures financial assets and liabilities at fair value, more or less, in the case of instruments that are not recognized at fair value with changes in profit or loss, with the transaction costs directly attributable to the acquisition, such as fees and commissions.

When the fair value differs from the acquisition cost at the time of initial recognition, the Company recognizes the difference as follows:

- When the fair value is consistent with the financial asset or liability market value, or is based on a valuation method relying on market values only, the difference is recognized as profit or loss, as the case may be.

a. Financial Assets

Debt Instruments

The Company classifies as debt instruments such instruments that are considered financial liabilities for the issuer, including loans, government and private securities, and bonds.

Classification

As set out in IFRS 9, the Company classifies financial assets as subsequently measured at amortized cost, at fair value with changes in other comprehensive income or at fair value with changes in profit or loss, on the basis of:

- the business model to manage financial assets; and

- the characteristics of contractual cash flows of the financial asset.

Business Model

The business model is the manner in which the Company manages a set of financial assets to achieve a specific business goal. It represents the manner in which the Company maintains instruments for cash generation.

The Group may follow several business models; whose objective is:

- Holding instruments until maturity;

- Holding instruments in portfolio to collect cash flows and, in turn, sell them if deemed convenient; or

- Holding instruments for trading.

The business model does not depend on the intended purpose of an individual instrument. Accordingly, this condition is not an approach for classification of instruments on an individual basis. Instead, such classification is determined at a higher level of aggregation.

The Company only reclassifies an instrument if and when the business model for managing financial assets has changed. The Company’s business model has not experienced changes during the period.

Characteristics of Cash Flows

The Company assesses whether the return on cash flows from the aggregated instruments does not substantially differ from the contribution it would receive as interest only; otherwise, such instruments should be measured at fair value with changes in profit or loss.

117

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Based on the aforementioned, Financial Assets are classified into three categories:

(i) Financial assets measured at amortized cost:

Financial assets are measured at amortized cost when:

(a) the financial asset is held within a business model whose objective is to maintain financial assets to collect contractual cash flows; and

(b) the contractual conditions of the financial asset give rise, on certain specified dates, to cash flows which are only principal and interest payments on the outstanding principal amount.

These financial instruments are initially recognized at fair value plus the incremental and directly attributable transaction costs, and are subsequently measured at amortized cost.

The amortized cost of a financial asset is equal to its acquisition cost, net of accumulated amortization plus accrued interest (calculated applying the effective rate method), net of impairment losses, if any.

(ii) Financial assets at fair value with changes in other comprehensive income:

Financial assets are measured at fair value with changes in other comprehensive income when:

(a) the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

(b) the contractual conditions of the financial asset give rise, on certain specified dates, to cash flows which are only principal and interest payments on the outstanding principal amount.

These instruments are initially recognized at fair value plus the incremental and directly attributable transaction costs, and are subsequently measured at fair value with changes in other comprehensive income. The gains and losses arising from the changes in fair value are included in other comprehensive income under a separate component of equity. Losses or impairment reversals, interest income, and exchange gains and losses are charged to income. Upon the sale or disposal of the instrument, the accumulated gains or losses previously recognized in other comprehensive income are reclassified from equity to the income statement.

(ii) Financial assets at fair value with changes in profit or loss:

Financial assets at fair value with changes in profit or loss include:

- Instruments held for trading;

- Instruments specifically designated at fair value with changes in profit or loss; and

- Instruments whose contractual terms do not represent cash flows but rather principal or interest payments only on outstanding principal amount.

These financial instruments are initially recognized at fair value and the gains or losses derived from them are charged to the income statement as realized.

The Company classifies a financial instrument as held for trading if such instrument is acquired or incurred for the main purpose of selling or repurchasing it in the short term, or if it is part of a portfolio of financial instruments which are managed jointly and for which there is evidence of short-term profits, or if it is a derivative which does not qualify as a hedging instrument. Derivatives and trading securities are classified as held for trading and are measured at fair value.

b.         Financial Liabilities

Classification

The Company classifies its financial liabilities at amortized cost using the effective rate method, except for:

- Financial liabilities measured at fair value with changes in profit or loss, including derivative instruments.

- Liabilities resulting from the transfer of financial assets that do not meet the derecognition requirements.

- Financial guarantee contracts.

118

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

- Loan commitments at lower than market rates.

Financial liabilities measured at fair value with changes in profit or loss: The Company may, upon initial recognition, avail itself of the irrevocable option to designate a liability at fair value with changes in profit or loss, if and only if exercising such option results in a better measurement of financial information because:

- the Company eliminates or substantially reduces measurement or recognition inconsistencies which would otherwise be revealed in valuation;

- if financial assets and liabilities are managed and performance is assessed on a fair value basis, according to a documented investment or risk management strategy; or

- if a host contract contains one or more embedded derivatives and the Company has opted to designate the entire contract at fair value with changes in profit or loss.

Financial guarantee contracts: Financial guarantee contracts require that the issuer make specified payments to reimburse the holder for the loss it may incur if a specific debtor fails to make payment when due under the original or modified terms of a debt instrument.

Financial guarantee contracts and loan commitments at lower than market rates are initially measured at fair value and then remeasured at the higher value resulting from a comparison between the commission pending accrual at year-end and the applicable allowance for impairment.

1.6.2.         Derecognition of Financial Instruments

a. Financial Assets

A financial asset or, where applicable, a portion of a financial asset or a portion of a group of similar financial assets, is derecognized when: (i) the rights to receive cash flows from the asset have been extinguished; or (ii) the Company has transferred its rights to receive cash flows from the asset or has assumed the obligation to pay right away all cash flows received to a third party under a pass-through agreement; and substantially all risks and rewards inherent to the asset have been transferred or, if substantially all risks and rewards inherent to the asset have not been transferred or retained, when control over such asset has been transferred.

When the contractual rights to receive the cash flows generated by the asset have been transferred or a pass-through agreement has been entered into, the entity will assess whether or not, and to which extent, it has retained the risks and rewards inherent to ownership of an asset. If an entity has neither transferred nor retained substantially all risks and rewards inherent to ownership of an asset, nor has it transferred control over such asset, then it will continue recognizing such asset in its financial statements to the extent of its continuing involvement with the same.

In this case, the entity will also recognize the related liability. The transferred asset and the related liability are measured in such a manner as to reflect the rights and obligations the Company has retained.

When continuing involvement takes the form of collateral over the transferred asset, it is measured at the lower of (i) the original carrying amount, and (ii) the maximum amount of the consideration received the entity could be required to repay.

b. Financial Liabilities

A financial liability is derecognized when the payment obligation ends, is canceled or expires. When an existing financial liability is exchanged for another with the same borrower under substantially different terms, or the prevailing terms are substantially modified, such exchange or modification will be treated as a derecognition of the original liability, and a new liability will be recognized. The difference between the carrying amount of the initial financial liability and the consideration paid is recognized in the consolidated income statement.

1.7.         PROPERTY, PLANT AND EQUIPMENT

Assets are measured at acquisition or construction cost, net of accumulated depreciation and/or impairment losses, if any. The cost includes expenses directly attributable to the acquisition or construction of these items.

Subsequent costs are included in the value of the asset and are recognized as a separate asset, as the case may be, if and only if future economic benefits are expected to flow to the Company and its cost can be measured reliably. When improvements are introduced to the asset, the carrying amount of the asset being replaced is derecognized, and the new asset is depreciated over its remaining useful life.

119

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Repair and maintenance expenses are recognized in the consolidated income statement for the period/year in which they were incurred.

Depreciation is calculated on a straight-line basis, using annual rates sufficient to extinguish the value of the assets at the end of their estimated useful life. If an asset is comprised by significant components with varying useful lives, such components will be recognized and depreciated as separate items.

Property, plant and equipment residual values, useful lives and depreciation methods are reviewed and adjusted, as needed, as of each year-end or when indicators of impairment exist.

The carrying amount of property, plant and equipment is immediately reduced to its recoverable value when the carrying amount exceeds the estimated recoverable value.

Gains and losses from the disposal of items of property, plant and equipment are calculated by comparing the proceeds from the disposal to the carrying amount of the respective asset and are recognized in the consolidated statement of comprehensive income.

1.8.         ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

Discontinued Operations

A discontinued operation is a Company’s component that either has been disposed of, or classified as held for sale, and meets any of the following conditions:

- represents either a separate major line of business or a geographical area of operations;

- is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations; or

- is an independent entity exclusively acquired for resale.

Any gain or loss on the remeasurement of an asset (or disposal group) classified as held for sale which does not meet the requirements to be classified as a discontinued operation will be recognized in income from continuing operations.

1.9.         IMPAIRMENT OF NON-FINANCIAL ASSETS

Assets with indefinite useful life are not amortized, but are rather tested for impairment on an annual basis. Unlike the preceding assumption, amortizable assets are tested for impairment when events or circumstances occur indicating that their carrying amounts may not be recoverable or, at least, on an annual basis.

Impairment losses are recognized when the carrying amount of an asset exceeds its recoverable value. The recoverable value of an asset is the higher of the net proceeds that would be derived from its disposal or its value in use. For purposes of the impairment test, assets are grouped at the lowest level for which identifiable cash flows are generated (cash-generating units or CGU). The carrying amount of non-financial assets, other than goodwill, which have experienced impairment is reviewed at each reporting date to check for potential impairment reversal.

1.10.         OFFSETTING

Financial assets and liabilities are offset by reporting the net amount in the consolidated balance sheet only to the extent the entity currently has a legally enforceable right of set-off, and intends to settle on a net basis, or realize the asset and settle the liability simultaneously.

1.11.         OTHER NON-FINANCIAL LIABILITIES

Non-financial accounts payable are accrued when the counterparty has fulfilled its contractual obligations and are measured at amortized cost.

1.12.         CAPITAL STOCK AND CAPITAL ADJUSTMENTS

Shareholders’ equity accounts are stated in a currency which does not reflect the changes in the price index since February 2003, except for the item “Capital Stock”, which is carried at face value. The restatement adjustment is included in “Adjustments to Shareholders’ Equity.”

120

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Ordinary shares are recognized in shareholders’ equity and carried at face value. When any company comprising the Group buys shares of the Company’s capital stock (treasury stock), the payment made, including any cost directly attributable to the transaction (net of taxes), is deducted from shareholders’ equity until the shares are either canceled or disposed of.

1.13.         PROFIT RESERVES

Pursuant to Section 70 of the General Corporations Law, the Company should transfer 5% of the net income for the fiscal year to the Legal Reserve until 20% of the capital stock is reached, plus the balance of the Capital Adjustment account.

1.14.         DISTRIBUTION OF DIVIDENDS

The distribution of dividends to the Company’s shareholders is recognized as a liability in the separate financial statements for the fiscal year in which dividends are approved by the shareholders.

1.15.         REVENUE RECOGNITION

Financial income and expense is recognized in respect of all debt instruments in accordance with the effective rate method, pursuant to which all gains and losses which are an integral part of the transaction effective rate are deferred.

Income included in the effective rate includes revenues or expenses related to the creation or acquisition of the financial asset or liability.

1.16.         INCOME TAX AND MINIMUM PRESUMED INCOME TAX

1.16.1.       Income Tax

The income tax expense for the year includes current and deferred tax. Income tax is recognized in the income statement for the period, except for items required to be recognized directly in other comprehensive income. In this case, the income tax liability related to such items is also recognized in such statement.

The current income tax expense is calculated on the basis of the tax laws enacted or substantially enacted as of the balance sheet date in the countries where the Company operates and generates taxable income. The Company periodically assesses the position assumed in tax returns in connection with circumstances in which the tax laws are subject to interpretation. On the other hand, when required, the Company sets up provisions in respect of the amounts expected to be required to pay to the tax authorities.

Deferred income tax is determined, in its entirety, by applying the liability method on the temporary differences arising from the carrying amount of assets and liabilities and their tax base. However, the deferred tax arising from the initial recognition of an asset or liability in a transaction other than a business combination which, at the time of the transaction does not affect income or loss for accounting or tax purposes, is not recorded. The deferred tax is determined using tax rates (and laws) enacted as of the balance sheet date and that are expected to be applicable when the deferred tax assets are realized or the deferred tax liabilities are settled.

Deferred tax assets are recognized only to the extent future tax benefits are likely to arise against which the temporary differences might be offset.

The Company recognizes a deferred tax liability for taxable temporary differences related to investments in subsidiaries and affiliates, except that the following two conditions are met:

(i) the Company controls the timing on which temporary differences will be reversed;

(ii) such temporary differences are not likely to be reversed in the foreseeable future.

The balances of deferred income tax assets and liabilities are offset when a legal right exists to offset current tax assets against current tax liabilities and to the extent such balances are related to the same tax authority, where tax balances are intended to be, and may be, settled on a net basis.

1.16.2.         Minimum Presumed Income Tax

The Company determines the minimum presumed income tax at the effective rate of 1% of the computable assets at each fiscal year-end. This tax is supplementary to income tax. The Company’s tax liability is equal to the higher of the two taxes. However, if the minimum presumed income tax were to exceed income tax in a given fiscal year, such excess may be computed as a payment on account of the income tax that could be generated in any of the next ten fiscal years.

121

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

The minimum presumed income tax credit disclosed under “Other Non-current Receivables” is the portion expected to be offset against the income tax in excess of minimum presumed income tax to be generated in the following ten fiscal years.

1.17.         EARNINGS PER SHARE

Basic earnings per share are calculated as income for the year attributable to the Company’s ordinary shareholders, excluding the after-tax effect of benefits attached to preferred shares, if any, divided by average ordinary shares outstanding.

Diluted earnings per share are calculated by adjusting income for the year attributable to shareholders and average ordinary shares outstanding for the effects of the potential conversion into equity instruments of all convertible notes held by the Company at year-end.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

The preparation of condensed interim financial statements in accordance with the IFRS-based accounting framework established by the Argentine Central Bank requires the use of certain significant accounting estimates.

The Company has identified the following areas which involve a higher degree of judgment or complexity, or the areas in which the assumptions and estimates are material to the condensed interim financial statements, as essential to understand the underlying accounting/financial reporting risks.

a.         IMPAIRMENT OF NON-FINANCIAL ASSETS

Intangible assets with definite useful life and property, plant and equipment are amortized or depreciated on a straight-line basis during their estimated useful life. The Company monitors the conditions associated with these assets to determine whether the events and circumstances warrant a review of the remaining amortization or depreciation term and whether there are factors or circumstances indicating impairment in the value of the asset which might not be recoverable.

Identifying indicators of impairment of property, plant and equipment and intangible assets requires the use of judgment. The Company has concluded that there were no indicators of impairment for any of the periods reported in its separate condensed interim financial statements.

b.         INCOME TAX AND DEFERRED TAX

The assessment of current and deferred tax assets and liabilities requires a significant level of judgment. Current income tax is accounted for according to the amounts expected to be paid, while deferred income tax is accounted for on the basis of the temporary differences between the carrying amount of assets and liabilities and their tax base, at the rates expected to be in force at the time of reversal of such differences.

A deferred tax asset is recognized when future taxable income is expected to exist to offset such temporary differences, based on management’s assumptions about the amounts and timing of such future taxable income. Then, management needs to determine whether deferred tax assets are likely to be used and offset against future taxable income. Actual results may differ from these estimates, for instance, changes in the applicable tax laws or the outcome of the final review of the tax returns by the tax authorities and tax courts.

Future taxable income and the number of tax benefits likely to be available in the future are based on a medium-term business plan prepared by management, on the basis of expectations which are deemed reasonable.

NOTE 3. TRANSITION TO IFRS

3.1.         REQUIREMENTS FOR THE TRANSITION TO IFRS

The following is a reconciliation between the shareholders’ equity, income statement and other comprehensive income amounts related to the separate financial statements issued according to the accounting framework prior to the transition date (January 1, 2017), the adoption date (December 31, 2017) and the closing date of the comparative period (September 30, 2017) and the amounts presented according to the IFRS-based accounting framework (see Note 1.1) in these separate condensed interim financial statements, as well as the effects of adjustments to cash flows.

122

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Separate Balance Sheet	Prior Accounting Framework 01.01.17		Reclassifications		IFRS Adjustments		Ref.	IFRS-based     Accounting Framework 01.01.17
ASSETS
Cash and Bank Deposits		320		2,724		-			3,044
Government and Private Securities		138,547		(138,547)		-			-
Loans and Other Financing Activities		-		2,853		-			2,853
Other Receivables Resulting from Financial Brokerage		24,432		(24,432)		-			-
Investments in Subsidiaries, Associates and Joint Ventures		20,544,691		(36,480)		2,813,374	(a)		23,321,585
Miscellaneous Receivables		39,292		(39,292)		-			-
Intangible Assets		5,642		-		(5,642)			-
Fair Value Debt Securities with Changes to Income		-		138,547		(474)			138,073
Other Financial Assets		-		27,732		-			27,732
Current Income Tax Assets		-		655		-			655
Other Non-financial Assets		-		29,760		-			29,760
Non-current Assets Held for Sale		-		36,480		(15)			36,465
TOTAL ASSETS		20,752,924		-		2,807,243			23,560,167
LIABILITIES
Other Liabilities Resulting from Financial Brokerage		363,957		(363,957)		-			-
Miscellaneous Liabilities		36,267		(36,267)		-			-
Notes Issued		-		363,957		(3,264)			360,692
Other Non-financial Liabilities		-		36,267		-			36,268
TOTAL LIABILITIES		400,224		-		(3,264)			396,960
SHAREHOLDERS’ EQUITY
Capital, Contributions and Reserves		14,334,823		-		-			14,334,823
Other Accumulated Comprehensive Income		-		-		284,182			284,182
Retained Income		6,017,877		-		2,526,325			8,544,202
TOTAL SHAREHOLDERS’ EQUITY		20,352,700		-		2,810,507			23,163,207
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		20,752,924		-		2,807,243			23,560,167

123

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Separate Balance Sheet	Prior Accounting Framework		Reclassifications		IFRS Adjustments		Ref.	IFRS-based Accounting Framework
	09.30.17							09.30.17
ASSETS
Cash and Bank Deposits		369		3,051		-			3,420
Government and Private Securities		9,220,705		(9,220,705)		-			-
Loans and Other Financing Activities		-		19,223		-			19,223
Other Receivables Resulting from Financial Brokerage		106,456		(106,456)		-			-
Investments in Subsidiaries, Associates and Joint Ventures		25,641,473		(28,967)		2,659,387	(a)		28,271,893
Miscellaneous Receivables		375,917		(375,917)		-			-
Intangible Assets		1,888		-		-			1,888
Fair Value Debt Securities with Changes to Income		-		9,220,705		-			9,220,705
Other Financial Assets				455,785		-			455,785
Current Income Tax Assets		-		1,017		-			1,017
Other Non-financial Assets		-		3,294		-			3,294
Non-current Assets Held for Sale		-		28,967		(2)			28,965
TOTAL ASSETS		35,346,808		(3)		2,659,385			38,006,190
LIABILITIES
Other Liabilities Resulting from Financial Brokerage		115,063		(115,063)		-			-
Miscellaneous Liabilities		37,030		(37,029)		-			-
Notes Issued		-		115,063		(439)			114,624
Other Non-financial Liabilities		-		37,027		-			37,027
TOTAL LIABILITIES		152,093		(3)		(439)			151,651
SHAREHOLDERS’ EQUITY
Capital, Contributions and Reserves		29,541,295		-		-			29,541,295
Other Accumulated Comprehensive Income		-		-		7,339			7,339
Retained Income		5,653,420		-		2,652,485			8,305,905
TOTAL SHAREHOLDERS’ EQUITY		35,194,715		-		2,659,824			37,854,539
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		35,346,808		(3)		2,659,385			38,006,190

124

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Separate Balance Sheet	Prior Accounting   Framework 12.31.17	Reclassifications	IFRS Adjustments	Ref.	IFRS-based Accounting Framework 12.31.17
ASSETS
Cash and Bank Deposits	364	3,325	-		3,689
Government and Private Securities	1,565,669	(1,565,669)	-		-
Loans and Other Financing Activities	-	19,713	-		19,713
Other Receivables Resulting from Financial Brokerage	109,043	(109,043)	-		-
Investments in Subsidiaries, Associates and Joint Ventures	37,641,520	(28,967)	2,837,104	(a)	40,449,657
Miscellaneous Receivables	4,198	(4,198)	-		-
Property, Plant and Equipment	1,827	-	-		1,827
Fair Value Debt Securities with Changes to Income	-	1,565,669	-		1,565,669
Derivative Instruments	-	11,638	-		11,638
Other Financial Assets	-	74,367	-		74,367
Current Income Tax Assets	-	5,511	-		5,511
Other Non-financial Assets	-	4,356	-		4,356
Non-current Assets Held for Sale		28,967	(2)		28,965
TOTAL ASSETS	39,322,621	5,669	2,837,102		42,165,392
LIABILITIES
Miscellaneous Liabilities	22,416	(22,416)	-		-
Current Income Tax Liabilities	-	14,941	-		14,941
Deferred Income Tax Liabilities	-	1,175	-		1,175
Other Non-financial Liabilities	-	11,969	-		11,969
TOTAL LIABILITIES	22,416	5,669	-		28,085
SHAREHOLDERS’ EQUITY
Capital, Contributions and Reserves	30,970,736	-	-		30,970,736
Other Accumulated Comprehensive Income	-	-	17,279		17,279
Retained Income	8,329,469	-	2,819,823		11,149,292
TOTAL SHAREHOLDERS’ EQUITY	39,300,205	-	2,837,102		42,137,307
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	39,322,621	5,669	2,837,102		42,165,392
Separate Income Statement	Prior Accounting   Framework 09.30.17	Reclassifications	IFRS Adjustments	Ref.	IFRS-based Accounting Framework 09.30.17
Financial Income	43,523	(43,523)	-		-
Financial Expenses	(43,627)	43,627	-		-
Loan Loss Provisions	-	(121)	-		(121)
Administrative Expenses	(72,352)	27,111	-		(45,241)
Miscellaneous Income	5,731,665	(5,731,665)	-		-
Miscellaneous Losses	(5,789)	5,789	-		-
Interest Income	-	12	-		12
Interest Expense	-	(43,412)	(2,825)		(46,237)
Net Income from Measurement of Fair Value Financial Instruments with Changes to Income	-	(32,636)	474		(32,162)
Exchange Rate Differences on Gold and Foreign Currency	-	76,147	-		76,147
Other Operating Income	-	10	-		10
Employee Benefits	-	(27,045)	-		(27,045)
Depreciation and Impairment of Assets	-	(5,706)	5,642		(64)
Other Operating Expenses	-	(241)	-		(241)
Income (Loss) for Subsidiaries	-	5,731,653	122,869	(a)	5,854,522
Net Income for the Period	5,653,420	-	126,160		5,779,580
Other Comprehensive Income	-	-	(276,843)		(276,843)
Total Comprehensive Income (Loss)	5,653,420	-	(150,683)		5,502,737

125

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Adjustments to Arrive to Cash and Cash Equivalents as of 09.30.17:

Cash and Cash Equivalents	Prior Accounting Framework		Adjustments		IFRS-based Accounting Framework
Cash and Bank Deposits		22,644		-		22,644
Argentine Central Bank’s Bills and Notes		9,220,705		-		9,220,705
Mutual Funds		84,181		-		84,181
Total		9,327,530		-		9,327,530

Classification of Cash Flows as of 09.30.17	Prior Accounting Framework		Adjustments		IFRS-based Accounting Framework
Operating Activities		(193,222)		(96,941)		(290,163)
Investing Activities		276,696		358,029		634,725
Financing Activities		9,080,757		(184,467)		8,896,290
Effect of Changes in the Exchange Rate		-		(76,147)		(76,147)
Total		9,164,231		474		9,164,705

Operating Activities	Prior Accounting Framework
Cash Flow According to Prior Accounting Framework		(193,222)
Changes in Net Operating Assets and Liabilities		(96,941)
Total		(290,163)

Investing Activities	Prior Accounting Framework
Cash Flow According to Prior Accounting Framework		276,696
Investments Pending Settlement		358,029
Total		634,725

Financing Activities	Prior Accounting Framework
Cash Flow According to Prior Accounting Framework		9,080,757
Payment of Interest, Net, According to the Prior Accounting Framework		42,848
Change in Capital Increase According to Prior Accounting Framework		(227,315)
Total		8,896,290

3.2.         OPTIONAL EXEMPTIONS TO IFRS

IFRS 1 allows entities that adopt IFRS for the first time to consider certain one-time exceptions. Such exceptions have been established by the IASB to make the first application of certain IFRS simpler, eliminating the mandatory nature of their retroactive application.

Below are the optional exceptions applicable to the Company under IFRS 1:

- Business Combinations: The Company has opted for not applying IFRS 3 “Business Combinations” retroactively for business combinations prior to the date of transition to IFRS.

The Company has not made use of other exemptions available in IFRS 1.

3.3.         MANDATORY EXCEPTIONS TO IFRS

Below are the mandatory exceptions applicable to the Company under IFRS 1:

1. Estimates: The estimates made according to the IFRS-based accounting framework as of January 1, 2017 (date of transition to IFRS) are consistent with the estimates made as of the same date according to the Argentine Central Bank’s accounting standards, considering what is described in Note 1 (non-application of the impairment chapter of IFRS 9).

2. Accounting derecognition of financial assets and liabilities: The Company applied the criteria of accounting derecognition of financial assets and liabilities under IFRS 9 prospectively for transactions occurring after January 1, 2017.

3. Classification and measurement of financial assets: The Company has considered the existing events and circumstances as of January 1, 2017 in its evaluation of whether the financial assets meet the characteristics to be classified as assets measured at amortized cost or at fair value with changes in profit or loss or at fair value with changes in other comprehensive income.

126

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

4. Other mandatory exceptions established by IFRS 1 that have not been applied because immateriality to the Company are:

- Hedge accounting

- Non-controlling interests

- Embedded derivatives

- Government loans

3.4.         RECONCILIATIONS REQUIRED

The following are the most significant adjustments made by applying the IFRS-based accounting framework, which were made to amounts recognized under the prior accounting framework, and are detailed in point 3.1.

(a) Investments in Subsidiaries, Associates and Joint Ventures: Subsidiaries’ financial statements have been used in applying the equity method. If applicable, the Shareholders’ Equity arising from the financial statements has been adjusted to account for the effect of the application of the IFRS-based accounting framework.

NOTE 4. FAIR VALUES

The Company classifies the fair values of financial instruments in three levels, according to the quality of data used to determine them.

Fair Value Level 1: The fair value of financial instruments traded in active markets (such as, publicly-traded derivatives, notes or available for sale) is based on the quoted prices of markets (unadjusted) as of the date of the reporting period. If the quote price is available and there is an active market for the instrument, it will be included in Level 1.

Fair Value Level 2: The fair value of financial instruments that are not traded in active markets, for example, the derivatives available over the counter, is determined using valuation techniques that maximize the use of observable information and relies to the least possible extent on the Group’s specific estimates. If all the material variables to establish the fair value of a financial instrument are observable, the instrument is included in Level 2.

Fair Value Level 3: If one or more material variables are not based on observable market information, the instrument is included in Level 3. This is the case of unquoted equity instruments.

The Group’s financial instruments measured at fair value at period-end are as follows:

Instruments Portfolio as of 09.30.18	Fair Value Level 1		Fair Value Level 2		Fair Value Level 3
Assets
- Argentine Central Bank’s Bills		48,759		-		-
- Government Securities		20,573		-		-
- Other Financial Assets		20,340		-		-
Total		89,672		-		-

The Company’s policy is to recognize transfers among the Fair Value levels only as of the year-end dates, there being no changes in relation to the financial instruments held in portfolio as of December 31, 2017.

Derivative Instruments

FORWARD PURCHASE-SALE OF FOREIGN CURRENCY WITHOUT DELIVERY OF THE UNDERLYING ASSET

Mercado Abierto Electrónico (MAE) and Rosario Futures Exchange (ROFEX) have trading environments for the closing, recording and settlement of financial forward transactions carried out among its agents, the Bank being one of them. The general settlement mode for these transactions is without delivery of the traded underlying asset. Settlement is carried out on a daily basis, in Pesos, for the difference, if any, between the closing price of the underlying asset and the closing price or value of the underlying asset corresponding to the previous day, the difference in price being charged to income.

The transactions are recorded in Off-Balance Sheet Items for the notional value traded. The accrued balances pending settlement are disclosed in the “Derivative Instruments” line of Assets and/or Liabilities, as the case may be.

127

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

The amounts of transactions conducted as of the dates indicated below are as follows:

	Underlying Asset		Type of Settlement		09.30.18		12.31.17
Forward Purchase – Sale of Foreign Currency
Purchases		Foreign Currency		Daily Difference		-		11,638

Other Financial Assets

Other Financial Assets break down as follows as of the dates indicated below:

Item	09.30.18		12.31.17
Listed Mutual Funds		20,318		74,367
Others		22		-
Total		20,340		74,367

NOTE 5. EQUITY INVESTMENTS AND RELATED PARTIES

5.1.         EQUITY INVESTMENTS

5.1.1.         Equity Investments in Subsidiaries

The basic information regarding subsidiaries is detailed as follows:

	Direct and Indirect Shareholding				Equity Investment %
Company	09.30.18		12.31.17		09.30.18		12.31.17
Banco de Galicia y Buenos Aires S.A.U.		795,973,974		795,973,974		100.00		100.00
Galicia Administradora de Fondos S.A.		20,000		20,000		100.00		100.00
Galicia Valores S.A.		1,000,000		1,000,000		100.00		100.00
Galicia Warrants S.A.		1,000,000		1,000,000		100.00		100.00
Net Investment S.A. (in Liquidation)(*)		-		12,000		-		100.00
Sudamericana Holding S.A.		185,653		185,653		100.00		100.00
Tarjetas Regionales S.A.		894,552,668		829,886,209		83.00		77.00

  (*) The final distribution was paid out on January 9, 2018.

	09.30.18(*)
Company	Assets		Liabilities		Shareholders’   Equity		Net Income
Banco de Galicia y Buenos Aires S.A.U.		469,636,156		429,877,381		39,758,775		7,328,673
Galicia Administradora de Fondos S.A.		480,102		81,850		398,252		375,707
Galicia Valores S.A.		267,626		53,810		213,816		61,436
Galicia Warrants S.A.		139,782		29,462		110,320		139,139
Sudamericana Holding S.A.		1,045,128		20,332		1,024,796		201,196
Tarjetas Regionales S.A.		10,199,333		52,963		10,146,370		2,155,488

  (*) The balances are related to accounts that arise from each subsidiary’s separate financial statements for publication.

	12.31.17(*)						09.30.17
Company	Assets		Liabilities		Shareholders’   Equity		Net Income
Banco de Galicia y Buenos Aires S.A.U.		294,591,891		253,614,822		38,977,069		5,264,607
Galicia Administradora de Fondos S.A.		648,287		188,086		460,201		311,285
Galicia Valores S.A.		175,436		23,056		152,380		57,058
Galicia Warrants S.A.		99,261		27,736		71,525		26,747
Net Investment S.A. (in Liquidation)(**)		283		-		283		23
Sudamericana Holding S.A.		1,002,635		14,248		988,387		108,232

  (*) The balances are related to accounts that arise from each subsidiary’s separate financial statements for publication.

  (**) The final distribution was paid out on January 9, 2018.

5.2.2.         Related Parties

Related parties are considered to be all those entities that directly, or indirectly through other entities, have control over another, are under the same control or may have significant influence on another entity’s financial or operational decisions.

The Company controls another entity when it has power over the other entities’ financial and operating decisions and also has a share of profits thereof.

Additionally, the Company believes that it has joint control when there is an agreement between parties regarding the control of a common economic activity.

128

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Finally, the Company has significant influence in those cases where it has the power to influence another entity’s financial and operating decisions, but cannot exert control over them. Those shareholders who hold an equity investment equal to or greater than 20% of the total votes of the Company or its subsidiaries are considered to have significant influence.

To determine those situations, not only are the legal aspects observed, but also the nature and substance of the relationship.

Furthermore, the key personnel of the Company’s management (including the Board of Directors members and managers), as well as the entities over which the key personnel may have significant influence or control are considered as related parties.

Controlling Entity

The Group is controlled by:

Name	Nature	Principal Line of Business	Place of Business	Equity Investment %
EBA Holding S.A.	55.11% of voting rights	Financial and Investment Activities	Autonomous City of Buenos Aires - Argentina	19.71%

Key Personnel’s Compensation

The compensation earned by the Company’s key personnel as of September 30, 2018 and December 31, 2017 amounts to $50,634 and $39,000, respectively.

Key Personnel’s Structure

The key personnel structure as of the dates indicated below is as follows:

	09.30.18		12.31.17
Directors		9		9
Total		9		9

Related Party Transactions

The Company has not been a party to or performed transactions or granted loans to:

(i) The companies that directly or indirectly through one or more intermediaries control or are controlled by the Company.

(ii) Associates (i.e., a consolidated company on which the Company has significant influence or that has a significant influence on the Company).

(iii) Persons who directly or indirectly have an equity investment with voting power at the Company giving significant influence on the Company and, as the case may be, the person’s ancestors, descendants, spouses or siblings (i.e., close relatives who may have influence o may be influenced by that person in their relationships with the Company).

(iv) Key management personnel.

(v) Companies with a substantial interest and whose ownership is held by any of the persons described in (iii) or (iv) and/or that are capable of having a significant influence on the Company. For the purposes of this paragraph, it includes companies owned by the directors or majority shareholders of the Company that have a key management member in common with the Company, as applicable.

Corporations Section 33 of General Corporations Law

The transactions performed with subsidiaries as of the dates indicated below are as follows:

129

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Banco de Galicia y Buenos Aires S.A.U.	09.30.18		12.31.17
Assets
Cash and Bank Deposits		657		474
Loans and Other Financing Activities		646,765		-
Derivative Instruments		-		11,638
Total		647,422		12,112
Liabilities
Other Non-financial Liabilities		90		342
Total		90		342
Income (Loss)
Interest Expense		-		(10,653)
Net Income from Measurement of Fair Value Financial Instruments with Changes to Income		-		11,638
Administrative Expenses		(3,290)		(3,815)
Total		(3,290)		(2,830)

NOTE 6. INFORMATION ABOUT THE SHAREHOLDERS’ EQUITY AND THE STATEMENT OF CASH FLOWS

6.1.       CAPITAL STOCK

The capital stock structure as of the dates indicated below is as follows:

	Face Value		Restated
Balances as of 01.01.17		1,300,265		1,578,396
Capital Increase		126,500		126,500
Balances as of 12.31.17		1,426,765		1,704,896
Balances as of 09.30.18		1,426,765		1,704,896

At the Ordinary and Extraordinary Shareholders’ Meeting of the Company held on August 15, 2017, the shareholders approved an increase in capital stock by means of the issuance of up to 150,000,000 ordinary book-entry Class “B” shares, entitled to one vote per share and with a face value of $1 each and also entitled to dividends on an equal footing with such ordinary book-entry shares outstanding at the time of the issuance.

On September 7, 2017, the Board of Directors of the C.N.V., by means of Joint Resolution No. RESFC-2017-18927-APN-DIR#CNV, authorized the public offering of 130,434,600 ordinary book-entry Class “B” shares, with a face value of $1 and one vote per share and, in case of over-subscription, an increase in such offering up to 19,565,190 ordinary book-entry Class “B” shares, with a face value of $1 and one vote each to be offered for public subscription, with preemptive and accretion rights.

The primary offering year ended on September 26, 2017, with 109,999,996 Class “B” shares having been subscribed at a price of US $5 each. On September 29, 2017, such shares were issued and paid.

The Company granted over-subscription rights to international placement agents who, on October 2, 2017, enforced such rights and were awarded additional 16,500,004 Class “B” shares at a price of US $5 each, the issuance and payment of which took place on October 4, 2017.

The capital increase amounted to $11,004,383, and the expenses related thereto amounted to $146,346 and were deducted from additional paid-in capital.

On November 8, 2017, the capital increase was registered with the Public Registry of Commerce.

6.2.        EARNINGS PER SHARE

Earnings per share are calculated by dividing income attributable to the Company’s shareholders by the weighted average of outstanding common shares during the year. As the Company does not have preferred shares or debt convertible into shares, basic earnings are equal to diluted earnings per share.

	09.30.18		09.30.17
Income attributable to the Company’s Shareholders		9,999,213		5,779,580
Weighted-Average of Ordinary Shares Outstanding (Thousands)		1,426,765		1,301,070
Earnings per Share		7.01		4.44

130

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

6.3.        STATEMENT OF CASH FLOWS

Cash and cash equivalents are broken down as follows:

Cash and Cash Equivalents	09.30.18		12.31.17		09.30.17		01.01.17.
Cash and Bank Deposits		7,579		3,689		3,420		3,044
Argentine Central Bank’s Bills Maturing within up to 90 Days		69,332		1,565,669		9,220,705		138,074
Mutual Funds		20,318		74,367		84,181		18,854
Sundry Debtors		22		-		-		-
Overnight Placements in Banks Abroad and Other Loans		699,113		19,713		19,224		2,853
Total Cash and Cash Equivalents		796,364		1,663,438		9,327,530		162,825

NOTE 7. NON-FINANCIAL ASSETS

7.1.        PROPERTY, PLANT AND EQUIPMENT

Changes in Property, Plant and Equipment are detailed in Schedule F.

7.2.        OTHER NON-FINANCIAL ASSETS

The breakdown of the account as of the dates indicated below was as follows:

	09.30.18		12.31.17
Value Added Tax – Tax Credit		83		986
Other Tax Credits		3,008		2,565
Payments in Advance		1,041		805
Total		4,132		4,356

7.3. NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

The Company has classified the following assets as “Assets Held for Sale and Discontinued Operations”:

	09.30.18		12.31.17
Equity Investments
Compañía Financiera Argentina S.A.		-		28,965
Total		-		28,965

On January 12, 2017, the Company accepted an offer made by Mr. Julio Alfredo Fraomeni and Galeno Capital S.A.U. to buy its whole minority interest in Compañía Financiera Argentina S.A. The sale of the shares in both companies was consummated on February 2, 2018, with the new holders having been registered in each of these companies’ books. The sale price was subject to the buyers’ consent, who were entitled to raise objections for up to 45 consecutive days beginning on January 29, 2018. On March 26, 2018, the sale of shares in Compañía Financiera Argentina S.A. was completed, establishing a final price of $30,771. The proceeds from the sale of Compañía Financiera Argentina S.A. amounted to $1,806. The income tax impact for discontinued operations is disclosed separately in the “Income Tax from Discontinued Activities” account, which amounts to $989 as of September 30, 2018.

NOTE 8. OTHER DISCLOSURES REQUIRED BY IFRS

8.1.        OPERATING LEASES

The Company records contractual obligations derived from the lease of administrative offices. The estimated future lease payments in connection thereof are as follows:

Year	US$
2018	13
2019	27
2020	27
2021	27
2022	13

131

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

8.2.         INCOME TAX

The following table shows the reconciliation of income tax charged to income to that which would result from applying the current tax rate to the book income as of the dates indicated below:

	09.30.18	09.30.17
Income for the Period Before Income Tax	10,028,062	5,779,580
Effective Tax Rate	30%	35%
Income for the Period at the Tax Rate	3,008,419	2,022,853
Permanent Differences at the Tax Rate
- Income (Loss) from Equity Investments	(2,984,227)	(2,053,888)
- Other Non-deductible Expenses	2,202	2,263
- Allowance for Impairment	1,888	80,915
- Others	558	(52,143)
Law 27430 Adjustment	9	-
Total Income Tax Charge for the Period (*)	28,849	-
(*) The total includes the balance related to discontinued operations.
	09.30.18	09.30.17
Current Tax	34,871	-
Deferred Tax Charge	(9,049)	80,915
Allowance for Impairment	1,888	(80,915)
Adjustment to 2017 Tax Return	1,139	-
Total Income Tax Charge	28,849	-

Changes in deferred income tax assets and liabilities are as follows:

Items	Balances as of 12.31.17		Expiration of Tax Loss Carry- forwards		Charge to Income		Allowance for Impairment		Others		Balances as of 09.30.18
Deferred Tax Assets
Tax Loss Carry-forwards		5,226		(5,226)		6,692		(3,764)		3,057		5,985
Equity Investments in Subsidiaries		3,302		-		(3,302)		-		-		-
Allowances		251		-		-		-		-		251
Employee Benefits		128		-		30		-		-		158
Total Deferred Tax Assets		8,907		(5,226)		3,420		(3,764)		3,057		6,394
Deferred Tax Liabilities
Debt Securities		-		-		824		-		(824)		-
Other Financial Assets		1,477		-		(1,369)		-		-		108
Property, Plant and Equipment		(29)		-		(43)		-		-		(72)
Directors’ Fees		-		-		(4,054)		-		4,054		-
Others		1,531		-		(987)		-		(1,460)		(916)
Total Deferred Tax Liabilities		2,979		-		(5,629)		-		1,770		(880)
Total, Net		5,928		(5,226)		9,049		(3,764)		1,287		7,274

The Company set a provision for the deferred tax asset as of September 30, 2018 and December 31, 2017 amounting to $3,764 and $7,103, respectively, as it is believed that the recovery thereof is not likely as of the date of these financial statements.

Tax Reform

On December 29, 2017, the National Executive Branch enacted Income Tax Law No. 27430. This law has introduced several changes to the previous income tax treatment. Some of the key changes involved in the reform include:

- Income Tax Rate: The income tax rate for Argentine companies shall be gradually reduced from 35% to 30% for the fiscal years commencing on January 1, 2018 until December 31, 2019, and to 25% for fiscal years commencing on, and including, January 1, 2020.

- Tax on Dividends: The law has introduced a tax on dividends or profits distributed by Argentine companies or permanent establishments, among others, to: individuals, undivided interests or foreign beneficiaries, subject to the following considerations: (i) dividends distributed out of the profits made during fiscal years commencing on January 1, 2018 until December 31, 2019 shall be subject to withholding at a 7% rate; and (ii) dividends distributed out of the profits made during fiscal years commencing on January 1, 2020 onwards shall be subject to withholding at a 13% rate.

132

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Dividends distributed from profits earned until the fiscal year before that commenced on January 1, 2018 shall remain subject, in respect of all beneficiaries, to withholding at the 35% rate on the amount in excess of tax-free distributable accumulated profits (the equalization tax transition period).

- Optional Tax Revaluation: Regulations establish that, at the companies’ option, the tax revaluation of assets located in the country and that are used for generating taxable income may be made. The special tax on the revaluation amount depends on the asset: 8% is for real estate that does not qualify as inventories, 15% for real estate that qualifies as inventories and 10% for personal property and the remaining assets. Once the option for a given asset is exercised, all the other assets of the same category should be revalued. Taxable income resulting from the revaluation is not subject to income tax and the special tax on the revaluation amount will not be deductible from such tax.

NOTE 9. INCOME STATEMENT BREAKDOWN

The income statement as of the dates indicated below is broken down as follows:

Interest Income	09.30.18			09.30.17
On Cash and Bank Deposits		271			12
Total		271			12
Interest Expense	09.30.18			09.30.17
For Interest on Notes Issued		-			(46,237	)
Total		-			(46,237	)
Net Income (Loss) from Measurement of Fair Value Financial Instruments with Changes to Income	09.30.18			09.30.17
From Measurement of Financial Assets at Fair Value with Changes in Profit or Loss
Income (Loss) from Government Securities		140,492			(35,238	)
Income (Loss) from Mutual Funds		7,043			3,076
Income (Loss) from Derivative Instruments		(13,108	)		-
Total		134,427			(32,162	)
Other Operating Income	09.30.18			09.30.17
Others		1			10
Total		1			10
Employee Benefits		09.30.18			09.30.17
Salaries		2,123			2,601
Social Security Contributions on Salaries		454			611
Severance Payments and Personnel Bonuses		177			23,511
Services to Personnel and Others		274			322
Total		3,028			27,045
Administrative Expenses		09.30.18			09.30.17
Fees and Compensation for Services		13,587			10,481
Directors’ and Syndics’ Fees		62,217			22,782
Taxes and Assessments		7,708			6,576
Electricity and Communications		8			49
Entertainment and Transportation Expenses		186			1,972
Stationery and Office Supplies		406			624
Administrative Services Hired		693			745
Insurance		468			296
Others(*)		9,756			1,716
Total		95,029			45,241

  (*) As of September 30, 2018, the balance includes $6,796 for issuance expenses related to the capital increase, non-deductible from additional paid-in capital.

Depreciation and Impairment of Assets	09.30.18		09.30.17
Depreciation of Property, Plant and Equipment		179		64
Total		179		64

133

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Other Operating Expenses	09.30.18		09.30.17
Turnover Tax		513		241
Total		513		241

NOTE 10. ADDITIONAL INFORMATION REQUIRED BY THE ARGENTINE CENTRAL BANK

10.1.         ISSUANCE OF NOTES

The following is a breakdown of the Global Programs for the Issuance of Notes outstanding:

Company	Authorized Amount(*)	Type of Notes	Term of Program	Date of Approval by Shareholders’ Meeting	Approval by the C.N.V.
Grupo Financiero Galicia S.A.	US$ 100,000	Simple notes, not convertible into shares	5 years	03.09.09 confirmed on 08.02.12	Resolution No. 16113 dated 04.29.09 and extended through Resolution No. 17343 dated 05.08.14. Authorization of the increase, Resolution No. 17064 dated 04.25.13

  (*) Or its equivalent in any other currency.

As of September 30, 2018 and December 31, 2017, the Company had not issued notes.

10.2.         RESTRICTIONS IMPOSED ON THE DISTRIBUTION OF PROFITS

Pursuant to Section 70 of the General Corporations Law, stock companies shall establish a reserve not lower than 5% of the realized and liquid profits shown in the Income Statement for the fiscal year, until 20% of the capital stock plus the balance of the capital adjustment account are reached. In the event that said reserve is reduced for any reason, no profits can be distributed until its total refund.

10.3.         CAPITAL MANAGEMENT AND CORPORATE GOVERNANCE TRANSPARENCY POLICY

The Company’s Board of Directors is the Company’s highest management body. It is made up of nine directors and three alternate directors, who must have the necessary knowledge and skills to clearly understand their responsibilities and duties within the corporate governance, and to act with the loyalty and diligence of a good businessman.

As set out in its bylaws, the term of office for both directors and alternate directors is three (3) years; they are partially changed every year and may be reelected indefinitely.

The Company complies with the appropriate standards regarding total number of directors, as well as the number of independent directors. Furthermore, its bylaws provide for the flexibility necessary to adapt the number of directors to the possible changes in the conditions in which the Company carries out its activities, from three (3) to nine (9) directors.

The Board of Directors complies, in every relevant respect, with the recommendations included in the Code on Corporate Governance as Schedule IV to Title IV of the regulations issued by the Argentine National Securities Commission (Text amended in 2013).

It also monitors the application of the corporate governance policies provided for by the regulations in force through the Audit Committee and the Committee for Information Integrity. Periodically, the Committees provide the Board of Directors with information, and the Board gets to know the decisions of each Committee. Appropriate matters are transcribed in the minutes drafted at the Board of Directors’ meetings.

The Audit Committee set by Capital Markets Law No. 26831 and the C.N.V.’s regulations is formed by three independent directors, and the Committee for Information Integrity’s mission is to comply with the provisions of the U.S. Sarbanes-Oxley Act.

134

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Basic Holding Structure

The Company is a company whose sole purpose is to conduct financial and investment activities as per Section 31 of the Argentine General Corporations Law. That is to say, it is a holding company whose activity involves managing its equity investments, assets and resources.

Within the group of companies in which the Company has an interest, the Bank in which the Company has a controlling equity interest stands out, being the Company’s main asset. The Bank, as a bank institution, is subject to certain regulatory restrictions imposed by the Argentine Central Bank. In particular, the Bank can only hold a 12.5% interest in the capital stock of companies that do not carry out activities considered supplementary by the Argentine Central Bank. Therefore, the Company holds, either directly or indirectly, the remaining interests in several companies. In addition, the Company indirectly holds a number of equity investments in supplementary companies that belong to the Bank as the controlling company.

Since the Company is a holding company, it has a limited personnel structure, and, therefore, many of the business organization requirements, common for big productive institutions, cannot be applied to this company.

To conclude, it is noteworthy that the Company is under the control of a pure holding company, EBA Holding S.A., which has the number of votes necessary to hold the majority of votes at the Shareholders’ Meetings, although it does not have any managerial functions over the Company and the Company has no group relationship with EBA Holding S.A.

Compensation Systems

Directors’ compensation is defined by the General Shareholders’ Meeting and is fixed within the limits established by law and the corporate bylaws.

The Audit Committee expresses its opinion on whether compensation proposals for Directors are reasonable, taking into consideration market standards.

Business Conduct Policy

The Company has consistently shown respect for the rights of its shareholders, reliability and accuracy in the information provided, transparency as to its policies and decisions, and caution with regard to the disclosure of strategic business issues.

Code of Ethics

The Company has a formally approved Code of Ethics that guides its policies and activities. It considers business objectivity and conflict-of-interests related-aspects, and how employees should act upon identifying a breach of the Code of Ethics.

10.4.         COMPLIANCE WITH THE REGULATIONS REQUIRED BY THE C.N.V.

10.4.1.         Agents – Minimum Liquidity Requirement

Within the framework of Resolution No. 622/13 of the C.N.V., the Bank has been registered, in such agency’s registry, as a settlement and clearing agent (–comprehensive- No. 22 (ALyC and AN – INTEGRAL)), a custodial agent of collective investment products corresponding to mutual funds No. 3 (ACPIC FCI), and a manager of collective investment products at the registry of financial trustees No. 54.

As of September 30, 2018, the Bank’s Shareholders’ Equity exceeds that required by the C.N.V. to act as agent in the categories in which the Bank has been registered. Such requirement amounts to $28,000 with a minimum liquidity requirement of $14,000, which the Bank paid with Argentine Central Bank’s monetary regulation instruments, which are held in custody at Caja de Valores (Depositor No. 100100) in the amount of $18,623.

Moreover, Galicia Valores S.A. has received the authorization to act as “Settlement and Clearing Agent and Trading Agent – Own”, as established by C.N.V.‘s General Resolution No. 622/13. According to the minimum requirements established, the minimum shareholders’ equity required to act in this agent’s category amounts to $3,500 and the minimum liquidity amounts to $1,750.

135

GRUPO FINANCIERO GALICIA S.A.

NOTES TO THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

As of September 30, 2018, the minimum liquidity is made up of a sight account opened at the Bank in the amount of US $250.

10.4.2.         Custodial Agent of Collective Investment Products Corresponding to Mutual Funds

Furthermore, in compliance with Section 7 of Chapter II, Title V of that Resolution, in its capacity as custodial agent of collective investment products corresponding to mutual funds (depository) of the “FIMA ACCIONES”, “FIMA P.B. ACCIONES”, “FIMA RENTA EN PESOS”, “FIMA AHORRO PESOS”, “FIMA RENTA PLUS”, “FIMA PREMIUM”, “FIMA AHORRO PLUS”, “FIMA CAPITAL PLUS”, “FIMA ABIERTO PYMES”, “FIMA MIX I”, “FIMA RENTA DOLARES I” and “FIMA RENTA DOLARES II” funds, as of September 30, 2018, the Bank holds a total of 9,631,903,301 units under custody for a market value of $58,066,481, which is included in the “Depositors of Securities Held in Custody” account. As of previous fiscal year-end and January 1, 2017, the securities held in custody totaled 10,254,289,765 and 7,777,368,861 units and their market value amounted to $67,972,574 and $37,337,855, respectively.

The balances of the mutual funds as of the dates indicated below are detailed as follows:

Mutual Fund	09.30.18		12.31.17		01.01.17.
FIMA Acciones		462,589		412,803		117,805
FIMA P.B. Acciones		1,141,136		1,143,324		305,310
FIMA Renta en pesos		345,862		525,826		239,066
FIMA Ahorro pesos		7,154,284		20,823,171		15,955,347
FIMA Renta Plus		166,399		369,949		247,293
FIMA Premium		29,671,212		10,098,362		7,130,327
FIMA Ahorro Plus		4,690,365		17,238,677		10,194,730
FIMA Capital Plus		241,672		379,178		561,800
FIMA Abierto PyMES		328,739		264,206		187,124
FIMA Mix I		10,352		164,890		151,487
FIMA Renta Dólares I (*)		10,808,830		12,384,341		2,245,266
FIMA Renta Dólares II (*)		3,045,041		4,167,847		2,300
Total		58,066,481		67,972,574		37,337,855

  (*) Stated at the reference exchange rate of the U.S. Dollar set by the Argentine Central Bank. See Note 1.7. (b).

All the transactions detailed above are recorded in off-balance sheet items - securities held in custody.

The mutual funds detailed above have not been consolidated as the Group is not a controlling company thereof.

10.4.3.         Storage of Documents

Pursuant to General Resolution No. 629 of the C.N.V., the Bank notes that it has supporting documents regarding accounting and management transactions, which are stored at AdeA (C.U.I.T. No. 30-68233570-6), Plant III located at Ruta Provincial 36 km 31.5 No. 6471 (CP 1888) Bosques, Province of Buenos Aires, with legal domicile at Av. Pte. Roque Sáenz Peña 832 Piso 1, C.A.B.A.

136

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE A – BREAKDOWN OF GOVERNMENT AND PRIVATE SECURITIES

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Holdings								Position
	Fair Value		Fair Value Level		Carrying Amount				Without Options		Options		Final
					09.30.18		12.31.17
FAIR VALUE DEBT SECURITIES WITH CHANGES TO INCOME		69,332				69,332		1,565,669						69,332
Argentine:		69,332				69,332		1,565,669						69,332
Argentine Central Bank’s Bills - L21F8		-		-		-		1,830
Argentine Central Bank’s Bills - L1708		48,759		Level 1		48,759		1,563,839		-		-		48,759
Letes in USD - LTDF9		20,573		Level 1		20,573		-		-		-		20,573

137

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE F – CHANGES IN PROPERTY, PLANT AND EQUIPMENT

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Item	Value at Beginning of Fiscal Year		Estimated Useful Life in Years		Additions		Disposals		Transfers		Depreciation								Net Book Value as of
											Accumulated		Disposals		For the Period		At Period-end		09.30.18		12.31.17
Measurement at Cost Vehicles		1,952		5		-		-		-		125		-		179		304		1,648		1,827
Total		1,952				-		-		-		125		-		179		304		1,648		1,827

Item	Value at Beginning of Fiscal Year		Estimated Useful Life in Years		Additions		Disposals		Transfers		Depreciation								Net Book Value as of
											Accumulated		Disposals		For the Period		At Period-end		12.31.17		01.01.17.
Measurement at Cost Vehicles		-		5		1,952		-		-		-		-		125		125		1,827		-
Total		-				1,952		-		-		-		-		125		125		1,827		-

138

GRUPO FINANCIERO GALICIA S.A.

SCHEDULE L – FOREIGN CURRENCY BALANCES

FOR THE PERIOD COMMENCED JANUARY 1, 2018 AND ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

	Head Office		09.30.18		09.30.18
Items	and												12.31.17
	Argentine				Dollar		Euro		Real		Others
	Branches
ASSETS
Cash and Bank Deposits		7,185		7,185		7,185		-		-		-		3,324
Fair Value Debt Securities with Changes to Income		20,573		20,573		20,573		-		-		-		-
Other Financial Assets		-		-		-		-		-		-		11,638
Loans and Other Financing Activities		52,348		52,348		52,348		-		-		-		19,713
Non-financial Public Sector		-		-		-		-		-		-		-
Argentine Central Bank		-		-		-		-		-		-		-
Other Financial Institutions		-		-		-		-		-		-		19,713
To the Non-financial Private Sector and Residents Abroad		52,348		52,348		52,348		-		-		-		19,713
TOTAL ASSETS		80,106		80,106		80,106		-		-		-		34,675
LIABILITIES								-		-		-
Other Non-financial Liabilities		11,510		11,510		11,510		-		-		-		5,753
TOTAL LIABILITIES		11,510		11,510		11,510		-		-		-		5,753

139

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

The following information as of December 31, 2017 has been prepared in accordance with the accounting framework set forth by the Argentine Central Bank and is required to understand these separate condensed interim financial statements.

1.        CASH AND BANK DEPOSITS

Cash equivalents are held to meet short-term payment commitments, rather than for investment or similar purposes. In order for a financial investment to be classified as cash equivalents, it should be readily convertible into a certain amount of cash and its risk of changes in value should be immaterial. Accordingly, an investment will be so classified as cash equivalents if it matures within three months or less from the acquisition date. Equity interests are excluded from cash equivalents.

The table below shows a breakdown of items comprising cash and cash equivalents:

	12.31.17		01.01.17.
Cash and Bank Deposits		3,689		1,409
Argentine Central Bank’s Bills Maturing within up to 90 Days		1,565,669		138,073
Mutual Funds		74,367		18,854
Overnight Placements in Banks Abroad		19,713		4,488
Total Cash and Cash Equivalents		1,663,438		162,824

2.        FINANCIAL INSTRUMENTS

As of the dates indicated below, the Company maintains the following portfolios of financial instruments:

Instruments Portfolio	Fair Value with Changes in Profit or Loss
	12.31.17		01.01.17.
Assets
Argentine Central Bank’s Bills		1,565,669		138,073
Other Financial Assets		74,367		27,732
Total		1,640,036		165,805

3.        FAIR VALUES

The Company classifies the fair values of financial instruments in three levels, according to the quality of data used to determine them.

The Company’s financial instruments measured at fair value as of the dates indicated below are as follows:

Instruments Portfolio as of 12.31.17	Fair Value Level 1		Fair Value Level 2		Fair Value Level 3
Argentine Central Bank’s Bills		1,565,669		-		-
Other Financial Assets		74,367		-		-
Total		1,640,036		-		-

Instruments Portfolio as of 12.01.17	Fair Value Level 1		Fair Value Level 2		Fair Value Level 3
Argentine Central Bank’s Bills		138,073		-		-
Other Financial Assets		27,732		-		-
Total		165,805		-		-

Valuation techniques are detailed in Note 4.

140

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

4.        OTHER FINANCIAL ASSETS

Other Financial Assets break down as follows as of the dates indicated below:

	12.31.17		01.01.17.
Listed Mutual Funds		74,367		18,854
Others		-		8,878
Total		74,367		27,732

5. EQUITY INVESTMENTS IN SUBSIDIARIES

Investments valued at the equity method are as follows:

Company	Equity Investment %		Place of Business	12.31.17		01.01.17.
Banco de Galicia y Buenos Aires S.A.U.		100.00	Autonomous City of Buenos Aires		38,977,075		22,079,927
Galicia Administradora de Fondos S.A.		100.00	Autonomous City of Buenos Aires		437,190		196,398
Galicia Valores S.A.		100.00	Autonomous City of Buenos Aires		1,524		-
Galicia Warrants S.A.		100.00	Autonomous City of Buenos Aires		114,376		109,502
Net Investment S.A. (in Liquidation)(*)		100.00	Autonomous City of Buenos Aires		248		226
Sudamericana Holding S.A.		100.00	Autonomous City of Buenos Aires		919,244		935,532

(*) The final distribution was paid out on January 9, 2018.

The changes that occurred during fiscal year 2017 in such investments are as follows:

Company	Balance as of 01.01.17		Capital Contributions / Purchases		Dividends Received		Other Comprehensive Income Items		Share of Profit (Loss) for the Year		Balance as of 12.31.17
Banco de Galicia y Buenos Aires S.A.U.		22,079,927		10,000,000		-		(280,566)		7,177,714		38,977,075
Galicia Administradora de Fondos S.A.		196,398		-		(187,008)		-		427,800		437,190
Galicia Valores S.A.		-		907		-		-		617		1,524
Galicia Warrants S.A.		109,502		-		(15,750)		-		20,624		114,376
Net Investment S.A. (in Liquidation)(**)		226		-		-		-		22		248
Sudamericana Holding S.A.		935,532		-		(439,250)		13,663		409,299		919,244

(*) The final distribution was paid out on January 9, 2018.

The assets, liabilities and income (loss) of subsidiaries, as they arise from their financial statements for publication, are as follows:

Company	12.31.17
	Assets		Liabilities		Shareholders’ Equity		Income (Loss)
Banco de Galicia y Buenos Aires S.A.U.		292,591,891		253,614,822		38,977,069		7,177,708
Galicia Administradora de Fondos S.A.		648,287		188,086		460,201		450,316
Galicia Valores S.A.		175,436		23,056		152,380		69,644
Galicia Warrants S.A.		99,261		27,736		71,525		31,475
Net Investment S.A. (in Liquidation)(**)		283		-		283		25
Sudamericana Holding S.A.		1,002,635		14,248		988,387		250,384

(*) The final distribution was paid out on January 9, 2018.

141

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

Cash and cash equivalents break down as follows:

Company	Cash		Cash Equivalents		Total
Banco de Galicia y Buenos Aires S.A.U.		58,460,898		25,623,182		84,084,080
Galicia Administradora de Fondos S.A.		12,327		-		12,327
Galicia Valores S.A.		6,783		142,141		148,924
Galicia Warrants S.A.		1,240		41,055		42,295
Net Investment S.A. (in Liquidation)(*)		284		-		284
Sudamericana Holding S.A.		2,556		493,885		496,651

(*) On January 9, 2018, the liquidators made the final distribution.

6.        PROPERTY, PLANT AND EQUIPMENT

Changes in “Property, Plant and Equipment” are detailed in Schedule F.

7.        DEFERRED INCOME TAX ASSETS/LIABILITIES

Changes in deferred income tax assets and liabilities during the fiscal year ended December 31, 2017 are as follows:

Items	Balances as of 01.01.17		Allowance for Impairment		Charge to Income (Loss)		Others		Balances as of 12.31.17
Deferred Tax Assets
Tax Loss Carry-forwards		148,071		(5,226)		(143,054)		209		-
Equity Investments in Subsidiaries		-		(1,877)		3,302		-		1,425
Allowances		2,578		-		(2,327)		-		251
Employee Benefits		-		-		106		22		128
Total Deferred Tax Assets		150,649		(7,103)		(141,973)		231		1,804
Deferred Tax Liabilities
Property, Plant and Equipment		-		-		(29)		-		(29)
Other Financial Assets		451		-		779		247		1,477
Directors’ Fees		-		-		-		-		-
Others		27		-		1,520		(16)		1,531
Total Deferred Tax Liabilities		478		-		2,270		231		2,979
Total, Net		150,171		(7,103)		(144,243)		-		(1,175)

The Company set an allowance for impairment of the deferred tax asset as of December 31, 2017 and January 1, 2017 amounting to $7,103 and $150,171, respectively, as it is believed that the recovery thereof is not likely as of the date of these financial statements.

8.        NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

The Company has classified the following assets as “Assets Held for Sale and Discontinued Operations” as of the dates indicated below:

	12.31.17		01.01.17.
Equity Investments
Compañía Financiera Argentina S.A.		28,965		36,465
Total		28,965		36,465

On January 12, 2017, the Company’s Board of Directors accepted an offer to buy all treasury shares, made by Mr. Julio Alfredo Fraomeni and Galeno Capital S.A.U. By virtue of Resolution No. 414, the Argentine Central Bank authorized the transaction.

The sale of shares took place on February 2, 2018. The purchase price of the shares was subject to the buyers’ consent, who were entitled to raise objections for 45 consecutive days beginning on January 29, 2018. On March 26, 2018, the sale of shares in Compañía Financiera Argentina S.A. was completed, establishing a final price of $30,771. The proceeds from the sale of Compañía Financiera Argentina S.A. amounted to $1,806. The income tax impact for discontinued operations is disclosed separately in the “Income Tax from Discontinued Activities” account, which amounts to $989 as of September 30, 2018.

142

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

9.        NOTES ISSUED

The following is a breakdown of the Global Programs for the Issuance of Notes outstanding:

Company	Authorized Amount(*)	Type of Notes	Term of Program	Date of Approval by Shareholders’ Meeting	Approval by the C.N.V.
Grupo Financiero Galicia S.A.	US$ 100,000	Simple notes, not convertible into shares	5 years	03.09.09 confirmed on 08.02.12	Resolution No. 16113 dated 04.29.09 and extended through Resolution No. 17343 dated 05.08.14. Authorization of the increase, Resolution No. 17064 dated 04.25.13

(*) Or its equivalent in any other currency.

The Company had the following Unsubordinated Notes outstanding under the Global Programs detailed in the table above as of the dates indicated below:

Date of Placement	Currency	Class No.	Face Value	Type (**)	Term	Maturity Date	Rate	Carrying Amount(*)			Issuance Authorized by the C.N.V.
								12.31.17		01.01.17.
01.30.14	$	V Series	$78,200	Simple	36 Months	01.31.17	Variable Badlar + 5.25%		-	81,454	04.25.13
10.23.14	$	VI Series II	$109,845	Simple	36 Months	10.23.17	Variable Badlar +4.25%		-	113,878	10.03.14
07.27.15	$	VII	$160,000	Simple	24 Months	07.27.17	(1)		-	165,360	07.16.15

(*) It includes principal and interest.

(**) Not convertible into shares.

(1) Annual nominal 27% fixed rate during the first nine months, and variable BADLAR plus a nominal annual 4.25% rate for the following 15 months.

10.        SHAREHOLDERS’ EQUITY STRUCTURE

	12.31.17		01.01.17.
Capital Stock		1,426,765		1,300,265
Non-capitalized Contributions		10,951,132		219,596
Capital Adjustments		278,131		278,131
Profit Reserves		18,314,708		12,536,831
Retained Income - First-time IFRS Adjustment		2,526,325		2,526,325
Other Accumulated Comprehensive Income		17,279		284,182
Net Income for the Fiscal Year		8,622,967		6,017,877
Total Shareholders’ Equity		42,137,307		23,163,207

11.        EARNINGS PER SHARE

Earnings per share are calculated by dividing income for the fiscal year by the weighted average of outstanding common shares during the year. As the Company does not have preferred shares or debt convertible into shares, basic earnings are equal to diluted earnings per share.

	12.31.17
Net Income for the Fiscal Year		8,622,967
Weighted-Average of Ordinary Shares Outstanding (Thousands)		1,332,617
Earnings per Share		6.47

12.        INTEREST INCOME

Interest Income	12.31.17
On Cash and Bank Deposits		52
Total		52

143

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

13.    INTEREST EXPENSE

Interest Expense	12.31.17
On Other Financial Liabilities		48,428
Total		48,428

14. NET INCOME (LOSS) FROM MEASUREMENT OF FAIR VALUE FINANCIAL INSTRUMENTS WITH CHANGES TO INCOME

Net Income (Loss) from Measurement of Fair Value Financial Instruments with Changes to Income	12.31.17
Income (Loss) from Government Securities		643,766
Income (Loss) from Mutual Funds		7,595
Total		651,361

15.    EXPENSES BY FUNCTION AND NATURE

The Company presented its statements of comprehensive income under the expenditure function method. Under this method, expenses are classified according to their function as part of the item “Administrative Expenses”.

The table below provides the required additional information about expenses by nature and function:

Administrative Expenses	12.31.17
Fees and Compensation for Services	14,754
Directors’ and Syndics’ Fees	27,859
Electricity and Communications	49
Taxes and Assessments	11,584
Stationery and Office Supplies	640
Entertainment and Transportation Expenses	242
Administrative Services Hired	1,255
Insurance	440
Others	2,594
Total	59,417

Depreciation and Impairment of Assets	12.31.17
Depreciation of Property, Plant and Equipment	125
Total	125

Other Operating Income	12.31.17
Others	4,955
Total	4,955

Other Operating Expenses	12.31.17
Turnover Tax	708
Total	708

16.    EMPLOYEE BENEFITS

The breakdown of the items disclosed under Employee Benefits as of December 31, 2017 was as follows:

	12.31.17
Salaries	3,534
Social Security Contributions on Salaries	725
Severance Payments and Personnel Bonuses	23,534
Services to Personnel and Others	416
Total	28,209

17.    INCOME TAX

The following is a reconciliation of income tax charged to income as of December 31, 2017 to that which would result from applying the tax rate in force to book income.

	12.31.17
Income for the Period Before Income Tax	8,639,083
Effective Tax Rate	35%
Income for the Period at the Tax Rate	3,023,679
Permanent Differences at the Tax Rate

144

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

- Income (Loss) from Equity Investments	(2,812,626)
- Other Non-deductible Expenses	1,333
- Allowance for Impairment	(143,068)
- Others	(51,051)
Law 27430 Adjustment	(2,146)
Total Income Tax Charge for the Period	16,121
Current Tax	14,941
Deferred Tax Charge	144,248
Allowance for Impairment	(143,068)
Total Income Tax Charge	16,121

Tax Reform

On December 29, 2017, the National Executive Branch enacted Income Tax Law No. 27430. This law has introduced several changes to income tax treatment. Some of the key changes involved in the reform include:

Income Tax Rates: The income tax rate for Argentine companies shall be reduced gradually from 35% to 30% for the fiscal years commencing on January 1, 2018 through December 31, 2019, and to 25% for the fiscal years commencing on, and including, January 1, 2020.

Tax on Dividends: The law has introduced a tax on dividends and profits distributed by Argentine companies or permanent establishments, among others, to individuals, undivided interests or foreign beneficiaries, subject to the following considerations: (i) dividends distributed out of the profits made during the fiscal years commencing on January 1, 2018 through December 31, 2019 shall be subject to withholding at a 7% rate; and (ii) dividends distributed out of the profits made during the fiscal years commencing on January 1, 2020 onwards shall be subject to withholding at a 13% rate.

Dividends distributed from profits earned until the fiscal year before that commenced on January 1, 2018 shall remain subject, in respect of all beneficiaries, to withholding at the 35% rate on the amount in excess of tax-free distributable accumulated profits (equalization tax transition period).

18. DIVIDENDS PER SHARE

Dividends paid in fiscal year 2017 to the Group’s Shareholders amounted to $240,000, representing $0.18 (figure stated in Pesos) per share.

19. RISKS

Apart from applicable local regulations, the Company, in its capacity as a listed company in the United States of America, complies with the certification of its internal controls pursuant to Section 404 of the Sarbanes Oxley Act (Sarbanes Oxley). Corporate risk management is monitored by the Audit Committee, which also gathers and analyzes relevant information submitted by the main controlled companies.

Market Risk

The following table shows a sensitivity analysis of income (loss) and shareholders’ equity to reasonable changes in exchange rates relative to the Company’s functional currency.

In 2017, the Group assigned a holding period to each instrument based on depth of market (previously, the time horizon was 10 sessions for the entire trading activities).

The Group’s exposure to the foreign exchange risk as of year-end by type of currency is shown below:

	Balances as of 12.31.17
Currency	Monetary Financial Assets		Monetary Financial Liabilities		Derivatives		Net Position
U.S. Dollar		23,037		-		-		23,037
Total		23,037		-		-		23,037

145

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION FOR THE SEPARATE CONDENSED INTERIM FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017

	Balances as of 01.01.17
Currency	Monetary Financial Assets		Monetary Financial Liabilities		Derivatives		Net Position
U.S. Dollar		5,576		-		-		5,576
Total		5,576		-		-		5,576

				Balances as of 12.31.17					Balances as of 01.01.17
Currency	Change			Income (Loss)			Shareholders’ Equity		Income (Loss)			Shareholders’ Equity
U.S. Dollar		10	%		2,304			25,341		558			6,134
		-10	%		(2,304	)		20,733		(558	)		5,018

146

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

1. GENERAL ISSUES REGARDING THE COMPANY’S ACTIVITIES:

a. SIGNIFICANT SPECIFIC LEGAL SYSTEMS ENTAILING CONTINGENT EXPIRATION OR RESURGENCE OF BENEFITS ENVISAGED BY THOSE REGULATIONS

None.

b. SIGNIFICANT CHANGES IN COMPANY ACTIVITIES OR OTHER SIMILAR CIRCUMSTANCES THAT OCCURRED DURING THE FISCAL YEARS COVERED BY THE FINANCIAL STATEMENTS WHICH MAY HAVE AN EFFECT ON THEIR COMPARISON WITH THOSE PRESENTED IN PREVIOUS FISCAL YEARS, OR THOSE THAT SHALL BE PRESENTED IN FUTURE FISCAL YEARS.

None.

2. CLASSIFICATION OF RECEIVABLES AND DEBT BALANCES INTO THE FOLLOWING CATEGORIES:

a. PAST DUE

As of September 30, 2018 and December 31, 2017, the Company did not have any past due receivables or debts.

b. WITHOUT DUE DATE

Receivables: See Schedules B, C, D.

Debts: See Schedules H, I.

c. TO FALL DUE

Receivables: See Schedules B, C, D.

Debts: See Schedules H, I.

3. CLASSIFICATION OF RECEIVABLES AND DEBTS IN SUCH A MANNER THAT ALLOWS KNOWING THE FINANCIAL EFFECTS OF THEIR MAINTENANCE

Receivables: See Schedules B, C, D.

Debts: See Schedules H, I.

4. BREAKDOWN OF PERCENTAGE OF EQUITY INVESTMENTS IN COMPANIES UNDER SECTION 33 OF LAW No. 19550, BOTH IN THE CAPITAL STOCK AND THE TOTAL VOTES. DEBIT AND/OR CREDIT BALANCES BY COMPANY AND CONSIDERED IN THE MANNER SET FORTH IN THE AFOREMENTIONED ITEMS 3 AND 4.

See Note 5.2.2 Related Parties to the separate condensed interim financial statements.

5. RECEIVABLES FROM OR LOANS GRANTED TO DIRECTORS OR SYNDICS OR THEIR RELATIVES UP TO THE SECOND DEGREE INCLUSIVE.

As of September 30, 2018 and December 31, 2017, there were no receivables from or loans granted to directors or syndics or their relatives up to the second degree inclusive.

6. PHYSICAL INVENTORY OF INVENTORIES: FREQUENCY AND SCOPE OF THE PHYSICAL INVENTORIES OF INVENTORIES

As of September 30, 2018 and December 31, 2017, the Company did not have any inventories.

147

GRUPO FINANCIERO GALICIA S.A.

ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

7. EQUITY INVESTMENTS IN EXCESS OF WHAT IS SET FORTH BY SECTION 31 OF LAW No. 19550 AND PLANS FOR THE REGULARIZATION OF THIS SITUATION

The Company is engaged in financial and investment activities, therefore, the restrictions of Section 31 of Law No. 19550 do not apply to its equity investments in other companies.

8. RECOVERABLE VALUES: CRITERIA FOLLOWED TO DETERMINE THE SIGNIFICANT RECOVERABLE VALUES OF INVENTORIES, FIXED ASSETS AND OTHER ASSETS, USED AS LIMIT FOR THEIR RESPECTIVE ACCOUNTING VALUATIONS.

See Notes 1 and 2 to the separate condensed interim financial statements.

9. INSURANCE POLICIES FOR TANGIBLE ASSETS

As of September 30, 2018 and December 31, 2017, the breakdown of insurance policies taken out by the Company for its fixed assets was as follows:

Insured Assets	Risks Covered	Insured Amount as of 09.30.18	Book Value as of 09.30.18		Carrying Amount as of 12.31.17
Vehicles	Theft, Robbery, Fire or Total Loss	2,688		1,648		1,827

10. POSITIVE AND NEGATIVE CONTINGENCIES:

a. ELEMENTS USED FOR THE CALCULATION OF PROVISIONS, THE BALANCES OF WHICH, EITHER TAKEN INTO CONSIDERATION INDIVIDUALLY OR JOINTLY, EXCEED TWO PER CENT (2%) OF SHAREHOLDERS’ EQUITY.

None.

b. CONTINGENCIES WHICH, AT THE DATE OF THE FINANCIAL STATEMENTS, ARE NOT OF REMOTE OCCURRENCE, THE EFFECTS OF WHICH ON SHAREHOLDERS’ EQUITY HAVE NOT BEEN GIVEN ACCOUNTING RECOGNITION. IT SHOULD BE STATED WHETHER THE LACK OF ACCOUNTING RECOGNITION IS BASED ON THE LIKELIHOOD OF OCCURRENCE OR ON THE DIFFICULTY TO ANALYZE SUCH EFFECTS.

As of September 30, 2018 and December 31, 2017, there were no contingencies which are not of remote occurrence and the effects of which on Shareholders’ Equity have not been given accounting recognition.

11. IRREVOCABLE ADVANCES TOWARDS FUTURE SHARE SUBSCRIPTIONS: STATUS OF CAPITALIZATION ARRANGEMENTS

As of September 30, 2018 and December 31, 2017, there were no irrevocable contributions towards future share subscriptions.

12. CUMULATIVE UNPAID DIVIDENDS ON PREFERRED SHARES

As of September 30, 2018 and December 31, 2017, there were no cumulative unpaid dividends on preferred shares.

13. CONDITIONS, CIRCUMSTANCES OR TERMS FOR THE TERMINATION OF THE RESTRICTIONS ON THE DISTRIBUTION OF RETAINED INCOME, INCLUDING THOSE ORIGINATED DUE TO THE USE OF THE LEGAL RESERVE FOR THE ABSORPTION OF LOSSES WHICH ARE STILL PENDING REIMBURSEMENT.

See Note 10.8 to the consolidated condensed interim financial statements.

148

GRUPO FINANCIERO GALICIA S.A.

SUPPLEMENTARY AND EXPLANATORY STATEMENT BY THE BOARD OF DIRECTORS

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

Pursuant to the provisions of the Rules regarding Accounting Documentation of the Córdoba Stock Exchange Regulations, the Board of Directors hereby submits the following supplementary and explanatory information.

A. CURRENT ASSETS

a) Receivables:

1) See Schedules B, C, D.

2) See Schedules B, C, D.

3) See Note 1.12 to these consolidated condensed interim financial statements.

b) Inventories:

As of September 30, 2018 and December 31, 2017, the Company did not have any inventories.

B. NON-CURRENT ASSETS

a) Receivables: See Note 1.12 to these consolidated condensed interim financial statements and Schedule B.

b) Inventories:

As of September 30, 2018 and December 31, 2017, the Company did not have any inventories.

c) Investments:

See Note 5 to the separate condensed interim financial statements.

d) Fixed Assets:

1) As of September 30, 2018 and December 31, 2017, the Company did not have any fixed assets that have been technically appraised.

2) As of September 30, 2018 and December 31, 2017, the Company did not have any obsolete fixed assets which have a book value.

e) Intangible Assets:

1) See Note 1.15, 3.5.1. and Schedule G.

2) As of September 30, 2018 and December 31, 2017, there were no deferred charges.

C. CURRENT LIABILITIES

a) Liabilities:

1) See Schedules D, I.

2) See Schedules B, D, I, R.

D. PROVISIONS

See Schedule J.

E. FOREIGN CURRENCY ASSETS AND LIABILITIES

See Note 1.5.b to these consolidated condensed interim financial statements.

See Schedule G.

F. SHAREHOLDERS’ EQUITY

1) As of September 30, 2018 and December 31, 2017, the Shareholders’ Equity did not include the “Irrevocable Advances towards Future Share Issues” account.

2) As of September 30, 2018 and December 31, 2017, the Company had not set up any technical appraisal reserve; nor has it reversed any reserve of that kind.

149

GRUPO FINANCIERO GALICIA S.A.

SUPPLEMENTARY AND EXPLANATORY STATEMENT BY THE BOARD OF DIRECTORS

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2018, PRESENTED IN COMPARATIVE FORMAT

Figures Stated in Thousands of Pesos ($), Except as Otherwise Stated

G. MISCELLANEOUS

1) The Company is engaged in financial and investment activities, therefore, the restrictions of Section 31 of Law No. 19550 do not apply to its equity investments in other companies.

2) See Notes 5.2 and 3.4.1 to these consolidated condensed interim financial statements and Note 5 to the separate condensed financial statements.

3) As of September 30, 2018 and December 31, 2017, there were no receivables from or loans granted to directors or syndics or their relatives up to the second degree inclusive.

4) See Notes 5.2 and 3.4.1 to these consolidated condensed interim financial statements and Note 5 to the separate condensed interim financial statements.

5) As of September 30, 2018 and December 31, 2017, the breakdown of insurance policies taken out by the Company for its fixed assets was as follows:

Insured Assets	Risks Covered	Insured Amount as of 09.30.18	Carrying Amount as of 09.30.18	Carrying Amount as of 12.31.17
Vehicles	Theft, Robbery, Fire or Total Loss	2,688	1,648	1,827

6) As of September 30, 2018 and December 31, 2017, there were no contingencies highly likely to occur which have not been given accounting recognition.

7) As of September 30, 2018 and December 31, 2017, the Company did not have any receivables including implicit interest or index adjustments.

The Company has complied with the requirements of Section 65 of Law No. 19550 in these financial statements.

Autonomous City of Buenos Aires, November 27, 2018

150

REPORT OF THE SUPERVISORY SYNDICS’ COMMITTEE

To the Directors and Shareholders of

GRUPO FINANCIERO GALICIA S.A.

Legal Domicile: Tte. Gral. Juan D. Perón 430 – 25th floor

Autonomous City of Buenos Aires

C.U.I.T. No. 30-70496280-7

DOCUMENTS EXAMINED

1. In our capacity as Grupo Financiero Galicia S.A.’s syndics, we have reviewed the accompanying consolidated and separate condensed interim financial statements of Grupo Financiero Galicia S.A. (hereinafter “the Entity”), which include:

• The Consolidated and Separate Condensed Interim Balance Sheets as of September 30, 2018.

• The Consolidated and Separate Condensed Interim Income Statement and Statement of Other Comprehensive Income for the three- and nine-month periods ended September 30, 2018.

• The Consolidated and Separate Condensed Interim Statement of Changes in Shareholders’ Equity and Cash Flows for the nine-month period then ended.

• A summary of significant accounting policies and other explanatory information included in notes and schedules.

• The Informative Review.

The amounts and other information for fiscal year 2017, and the related interim periods, are an integral part of the financial statements mentioned above and are disclosed to be exclusively construed in connection with the amounts and information for the current interim period.

MANAGEMENT’S RESPONSIBILITY REGARDING THE FINANCIAL STATEMENTS

2. The Entity’s Board of Directors is responsible for the preparation and fair presentation of the financial statements, in accordance with the accounting framework established by the Argentine Central Bank (the B.C.R.A.), and the internal control deemed necessary to allow for the preparation of the financial statements free from material misstatements. As mentioned in Note 1.1 to the accompanying consolidated and separate condensed interim financial statements, such accounting framework is based on applying the International Financial Reporting Standards (IFRS) and, particularly, the International Accounting Standard 34 “Interim Financial Reporting” (IAS 34), as approved by the International Accounting Standards Board (IASB). Such standards were adopted by the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.) and by the B.C.R.A., and were used in preparing the financial statements, with the exception for application of point 5.5 “Impairment” of IFRS No. 9 and International Accounting Standard (IAS 29), which were excluded by the B.C.R.A. from the accounting framework applicable to financial institutions.

151

SYNDIC’S RESPONSIBILITY

3. Our responsibility is to express a conclusion on the documents mentioned in section 1, based on the reviews we conducted within the scope specified in the following paragraph.

4. Our work was conducted in accordance with effective legal standards applicable to syndics and by those set out in Technical Pronouncement No. 15 of the Argentine Federation of Professional Councils in Economic Sciences. These standards require that the review of quarterly financial statements be conducted observing standards applicable to engagements for review of interim-period financial statements, and verify the consistency of the documents examined with the information concerning corporate decisions, as disclosed in minutes. In addition, they require that corporate decisions entered in minutes conform to the law and the bylaws with respect to formal and documentary requirements. For purposes of our professional work on the documents detailed above, we have considered the review performed by the external auditor, Price Waterhouse & Co. S.R.L., who issued their unqualified limited review report on November 27, 2018, in accordance with auditing standards in force applicable to engagements for review of interim-period financial statements. Such review included verifying the work plan and the nature, scope and timing of the procedures applied, and the results of the review performed by those professionals. The above-mentioned external auditors conducted their reviews in accordance with Technical Pronouncement No. 37 of the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.) for the review of interim-period financial statements and the auditing standards issued by the Argentine Central Bank (the B.C.R.A.) for limited reviews. A review of interim financial statements consists in making inquiries to the entity’s staff, mainly those responsible for the financial and accounting matters, as well as performing analytic and other review procedures. The scope of this review is substantially more limited than that of an audit and, therefore, does not allow us to obtain assurance that we will be aware of all the significant matters that could be identified in an audit. Therefore, we do not express an audit opinion.

Given that it is not our responsibility to exercise any management control, the review did not extend to the business criteria and decisions of the different areas of the Entity, as these matters are the exclusive responsibility of the Board of Directors.

We also report that, in compliance with the legality control that is part of our field of competence, during this period we have applied the other procedures described in Section 294 of Law No. 19550, which we deemed necessary according to the circumstances.

CONCLUSION

• Based on our reviews, within the scope described in “Syndic’s Responsibility” above, and considering the external auditor’s review report, there is no reason for us to believe that the condensed interim financial statements mentioned in section 1 of this report are not fairly prepared, in all material respects, in accordance with the Argentine Central Bank’s accounting standards.

• In compliance with the legality control that is part of our field of competence, we do not make any observations.

Without changing our conclusion:

i) We call attention to Note 1.1 to the accompanying consolidated and separate condensed interim financial statements, where we describe the difference between the B.C.R.A.- and the IFRS-based accounting framework, considering that the application of Section 5.5 “Impairment” of IFRS 9 “Financial Instruments” and IAS 29 were excluded by the B.C.R.A. from the accounting framework applicable to financial institutions.

152

ii) We call attention to Note 1.1, which states that the condensed interim financial statements mentioned in section 1 have been prepared according to the accounting framework established by the B.C.R.A., according to IAS 34 (with the exception described in such note), this being the first fiscal year in which the Entity applies those standards. The effects of changes resulting from applying this new accounting basis are presented in Note 3 to the consolidated and separate condensed interim financial statements. The items and figures included in the reconciliations contained in such notes are subject to changes that may result from changes in IFRS to be applied and may only be considered to be final upon the preparation of the annual financial statements for this fiscal year.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

We report that:

i) The consolidated and separate condensed interim financial statements of Grupo Financiero Galicia S.A. as of September 30, 2018 have been transcribed to the “Inventory and Balance Sheet” book and are in compliance with the provisions of the Argentine General Corporations Law, and pertinent resolutions of the B.C.R.A. and the Argentine National Securities Commission.

ii) The consolidated and separate condensed interim financial statements of Grupo Financiero Galicia S.A. as of September 30, 2018, stem from accounting records kept, in all formal aspects, in compliance with legal regulations prevailing in Argentina.

iii) We have applied the procedures related to the laundering of assets from illegal activities and funding of terrorist activities set out in Resolution No. 420/11 of the Argentine Federation of Professional Councils in Economic Sciences

iv) We have read the information included in Note 10.4.1 to the separate condensed interim financial statements as of September 30, 2018 regarding the requirements established by the National Securities Commission about the Minimum Shareholders’ Equity and the Minimum Liquidity, on which, insofar as concerns our field of competence, we have no observations to make.

Autonomous City of Buenos Aires, November 27, 2018.

Supervisory Syndics’ Committee

153

INDEPENDENT AUDITOR’S LIMITED REVIEW REPORT

To the Chairman and Directors of

Grupo Financiero Galicia S.A.

Legal Domicile: Tte. Gral. Juan D. Perón 430 – 25th floor

Autonomous City of Buenos Aires

C.U.I.T. No. 30-70496280-7

Introduction

We have reviewed the accompanying separate condensed interim financial statements of Grupo Financiero Galicia S.A. (hereinafter “the Entity”), which include the Separate Condensed Interim Balance Sheet as of September 30, 2018, the related Separate Condensed Interim Income Statement and Statement of Other Comprehensive Income for the three- and nine-month periods ended September 30, 2018, and the Separate Condensed Interim Statement of Changes in Shareholders’ Equity and Cash Flows for the nine-month period then ended, as well as a summary of significant accounting policies and other explanatory information included in notes and schedules supplementing them.

The amounts and other information for fiscal year 2017, and the related interim periods, are an integral part of the financial statements mentioned above and, therefore, shall be considered in relation with those financial statements.

Management’s Responsibility

The Entity’s Board of Directors is responsible for the preparation and presentation of the separate condensed interim financial statements, in accordance with the accounting framework established by the Argentine Central Bank (the B.C.R.A.). As mentioned in Note 1.1 to the accompanying financial statements, such accounting framework is based on applying the International Financial Reporting Standards (IFRS) and, particularly, the International Accounting Standard 34 “Interim Financial Reporting” (IAS 34), approved by the International Accounting Standards Board (IASB). Such standards were adopted by the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.) and by the B.C.R.A., and were used in preparing the financial statements, with the exception of application of point 5.5 “Impairment” of IFRS No. 9 and International Accounting Standard (IAS 29).

Scope of our Review

Our review was limited to the application of the procedures set forth in F.A.C.P.C.E.’s Technical Pronouncement No. 37 for the review of interim financial statements and the auditing standards issued by the B.C.R.A. for limited reviews. A review of interim financial statements mainly involves

making inquiries to the Entity’s staff responsible for the preparation of the information included in the separate condensed interim financial statements and the performance of analytical procedures and other review procedures. The scope of this review is substantially more limited than an audit examination performed according to Argentine Audit Standard, therefore, a review does not allow us to be certain that we shall be informed of all significant issues that may be identified during an audit. Therefore, we do not express an audit opinion on the Entity’s separate financial position, separate comprehensive income and separate cash flows.

Conclusion

Based on our review, nothing has called our attention that would make us think that the separate condensed interim financial statements mentioned in the first paragraph of this report are not prepared, in all significant aspects, in accordance with the accounting framework established by the B.C.R.A.

Emphasis Paragraphs

Difference between the B.C.R.A. accounting reporting framework and the IFRS

Without changing our conclusion, we call the attention to Note 1.1 to the accompanying separate condensed interim financial statements, which describes the difference between the B.C.R.A.- and the IFRS-based accounting framework, considering that the application of Section 5.5 “Impairment” of IFRS 9 “Financial Instruments” and IAS 29 were excluded by the B.C.R.A. from the accounting framework applicable to financial institutions.

First fiscal year of IAS 34 application

Without changing our conclusion, we call the attention to Note 1.1, which states that the separate condensed interim financial statements mentioned in the first paragraph have been prepared according to the accounting framework established by the B.C.R.A., pursuant to IAS 34 (with the exception described in such note), being this the first fiscal year in which the Entity applies those standards. The effects of the changes generated by the application of this new accounting basis are disclosed in Note 3. Items and amounts included in the reconciliations contained in such note are subject to changes that may arise as a result of variations in the IFRS to be finally applied and shall only be deemed final when the annual financial statements for this fiscal year are prepared.

Report on Compliance with Regulations in force

As required by the regulations in force, we report that:

a) The separate condensed interim financial statements of Grupo Financiero Galicia S.A. stem from accounting records kept, in all formal aspects, in compliance with legal regulations;

b) The separate condensed interim financial statements of Grupo Financiero Galicia S.A. as of September 30, 2018 have been transcribed to the “Inventory and Balance Sheet” book and, insofar as concerns our field of competence, are in compliance with the provisions of the General Corporations Law, and pertinent resolutions of the B.C.R.A. and the National Securities Commission;

c) We have read the additional information to the notes to separate condensed interim financial statements required by Title IV, Chapter III, Article 12 of the regulations of the National Securities Commission, on which, insofar as concerns our field of competence, we have no observations to make.

d) As of September 30, 2018, Grupo Financiero Galicia S.A.’s accrued debt with the Argentine Integrated Social Security System, which stems from the accounting records, amounted to $62,955.25, which was not yet due at that date.

e) As required by Title IV, Section I, Chapter I, Article 2 of the Regulations of the National Securities Commission, we report that:

e.1) Grupo Financiero Galicia S.A.’s corporate purpose is exclusively related to financial and investment activities;

e.2) The equity investment in Banco de Galicia y Buenos Aires S.A.U. and Tarjetas Regionales S.A., the second one subject to the consolidated supervision requirements issued by the Argentine Central Bank (Communiqué “A” 2989, and complementary), represents 94.64% of Grupo Financiero Galicia S.A.’s assets, being the Company’s main asset.

e.3) 91.15% of Grupo Financiero Galicia S.A.’s income stems from the share of profit (loss) of the entities mentioned in e.2).

e.4) Grupo Financiero Galicia S.A. holds a 100% equity interest in Banco de Galicia y Buenos Aires S.A.U. and an 83% equity interest in Tarjetas Regionales S.A., thus having control over such entities.

f) We have read the information included in Note 10.4.1 to the separate condensed interim financial statements as of September 30, 2018 regarding the requirements established by the National Securities Commission about the Minimum Shareholders’ Equity and the Minimum Liquidity, on which, insofar as concerns our field of competence, we have no observations to make.

Autonomous City of Buenos Aires, November 27, 2018.

PRICE WATERHOUSE & CO. S.R.L.

INDEPENDENT AUDITOR’S LIMITED REVIEW REPORT

To the Chairman and Directors of

Grupo Financiero Galicia S.A.

Legal Domicile: Tte. Gral. Juan D. Perón 430 – 25th floor

Autonomous City of Buenos Aires

C.U.I.T. No. 30-70496280-7

Introduction

We have reviewed the accompanying consolidated condensed interim financial statements of Grupo Financiero Galicia S.A. (hereinafter “the Entity”), which include the Consolidated Condensed Interim Balance Sheet as of September 30, 2018, the related Consolidated Condensed Interim Income Statement and Statement of Other Comprehensive Income for the three- and nine-month periods ended September 30, 2018, and the Consolidated Condensed Interim Statement of Changes in Shareholders’ Equity and Cash Flows for the nine-month period then ended, as well as a summary of significant accounting policies and other explanatory information included in notes and schedules supplementing them.

The amounts and other information for fiscal year 2017, and the related interim periods, are an integral part of the financial statements mentioned above and, therefore, shall be considered in relation with those financial statements.

Management’s Responsibility

The Entity’s Board of Directors is responsible for the preparation and presentation of the consolidated condensed interim financial statements, in accordance with the accounting framework established by the Argentine Central Bank (the B.C.R.A.). As mentioned in Note 1.1 to the accompanying financial statements, such accounting framework is based on applying the International Financial Reporting Standards (IFRS) and, particularly, the International Accounting Standard 34 “Interim Financial Reporting” (IAS 34), approved by the International Accounting Standards Board (IASB). Such standards were adopted by the Argentine Federation of Professional Councils in Economic Sciences (F.A.C.P.C.E.) and by the B.C.R.A., and were used in preparing the financial statements, with the exception of application of point 5.5 “Impairment” of IFRS No. 9 and International Accounting Standard (IAS 29).

Scope of our Review

Our review was limited to the application of the procedures set forth in F.A.C.P.C.E.’s Technical Pronouncement No. 37 for the review of interim financial statements and the auditing standards issued by the B.C.R.A. for limited reviews. A review of interim financial statements mainly involves making inquiries to the Entity’s staff responsible for the preparation of the information included in the consolidated condensed interim financial statements and the performance of analytical procedures and other review procedures. The scope of this review is substantially more limited than an audit examination performed according to Argentine Audit Standard, therefore, a review does not allow us to be certain that we shall be informed of all significant issues that may be identified during an audit. Therefore, we do not express an audit opinion on the Entity’s consolidated financial position, consolidated comprehensive income and consolidated cash flows.

Conclusion

Based on our review, nothing has called our attention that would make us think that the consolidated condensed interim financial statements mentioned in the first paragraph of this report are not prepared, in all significant aspects, in accordance with the accounting framework established by the B.C.R.A.

Emphasis Paragraphs

Difference between the B.C.R.A. accounting reporting framework and the IFRS

Without changing our conclusion, we call attention to Note 1.1 to the accompanying consolidated condensed interim financial statements, which describes the difference between the B.C.R.A.- and the IFRS-based accounting framework, considering that the application of Section 5.5 “Impairment” of IFRS 9 “Financial Instruments” and IAS 29 were excluded by the B.C.R.A. from the accounting framework applicable to financial institutions.

First fiscal year of IAS 34 application

Without changing our conclusion, we call attention to Note 1.1, which states that the consolidated condensed interim financial statements mentioned in the first paragraph have been prepared according to the accounting framework established by the B.C.R.A., pursuant to IAS 34 (with the exception described in such note), being the first fiscal year in which the Entity applies those standards. The effects of the changes generated by the application of this new accounting basis are disclosed in Note 3. Items and amounts included in the reconciliations contained in such note are subject to changes that may arise as a result of variations in the IFRS to be finally applied and shall only be deemed final when the annual financial statements for this fiscal year are prepared.

Report on the Compliance of Regulations in force

As required by the regulations in force, we report that:

a) The consolidated condensed interim financial statements of Grupo Financiero Galicia S.A. stem from accounting records kept, in all formal aspects, in compliance with legal regulations;

b) The consolidated condensed interim financial statements of Grupo Financiero Galicia S.A. as of September 30, 2018 have been transcribed to the “Inventory and Balance Sheet” book and, insofar as concerns our field of competence, are in compliance with the provisions of the General Corporations Law, and pertinent resolutions of the B.C.R.A. and the National Securities Commission;

c) We have read the Informative Review, on which, insofar as concerns field of competence, we have no observations to make.

d) As of September 30, 2018, Grupo Financiero Galicia S.A.’s accrued debt with the Argentine Integrated Social Security System, which stems from the accounting records, amounted to $62,955.25, which was not yet due at that date.

e) As required by Title IV, Section I, Chapter I, Article 2 of the Regulations of the National Securities Commission, we report that:

e.1) Grupo Financiero Galicia S.A.’s corporate purpose is exclusively related to financial and investment activities;

e.2) The equity investment in Banco de Galicia y Buenos Aires S.A.U. and Tarjetas Regionales S.A., the second one subject to the consolidated supervision requirements issued by the Argentine Central Bank (Communiqué “A” 2989, and complementary), represents 94.64% of Grupo Financiero Galicia S.A.’s assets, being the Company’s main asset.

e.3) 91.15% of Grupo Financiero Galicia S.A.’s income stems from the share of profit (loss) of the entities mentioned in e.2).

e.4) Grupo Financiero Galicia S.A. holds a 100% equity interest in Banco de Galicia y Buenos Aires S.A.U. and an 83% equity interest in Tarjetas Regionales S.A., thus having control over such entities.

f) We have read the information included in Note 10.4.1 to the separate condensed interim financial statements as of September 30, 2018 regarding the requirements established by the National Securities Commission about the Minimum Shareholders’ Equity and the Minimum Liquidity, on which, insofar as concerns our field of competence, we have no observations to make.

Autonomous City of Buenos Aires, November 27, 2018.

PRICE WATERHOUSE & CO. S.R.L.