BANK POLSKA KASA OPIEKI SPÓŁKA AKCYJNA Condensed Interim Unconsolidated Financial Statements of Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008
Warsaw, September 2008 TABLE OF CONTENTS
WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish
INCOME STATEMENT ...... 1 BALANCE SHEET...... 2 STATEMENT OF CHANGES IN EQUITY ...... 3 CASH FLOW STATEMENT ...... 5 NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS...... 7 1. Accounting polices ...... 7 2. Interest income ...... 8 3. Interest expenses ...... 8 4. Fee and commission income ...... 8 5. Fee and commission expense ...... 8 6. Dividend income ...... 8 7. Result on financial instruments valued at fair value ...... 9 8. Result on investment securities ...... 9 9. Other operating income and expense ...... 9 10. Net provision charges for financial assets and contingent liabilities and commitments ...10 11. Administrative costs...... 10 12. Earnings per share ...... 11 13. Loans and advances due from banks ...... 11 14. Financial assets held for trading ...... 11 15. Derivative financial instruments ...... 12 16. Other financial instruments measured at fair value through profit and loss ...... 12 17. Loans and advances to customers ...... 13 18. Cash flow hedge (macro hedge) ...... 13 19. Investment securities ...... 14 20. Non – current assets held for sale ...... 14 21. Investments in subsidiaries ...... 15 22. Investments in associates ...... 15 23. Intangible assets ...... 15 24. Tangible fixed assets ...... 16 25. Investment properties ...... 16 26. Amounts due to other banks ...... 16 27. Financial liabilities held for trading ...... 16 28. Amounts due to customers ...... 17 29. Debt securities issued ...... 17 30. Provisions ...... 17 31. Equity ...... 18 32. Contingent liabilities and insurance contracts ...... 18 33. Dividend paid ...... 19 34. Litigation ...... 19 35. Transactions with related parties ...... 20 36. Events after the balance sheet date ...... 25
2 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
CONDENSED INTERIM UNCONSOLIDATED FINANCIAL STATEMENTS OF THE BANK PEKAO S.A.
The financial data included in these condensed interim unconsolidated financial statements have been presented in PLN thousand.
INCOME STATEMENT
Note I Half 2008 I Half 2007
Interest income 2 3 749 088 1 967 746 Interest expense 3 (1 675 416) (837 950) Net interest income 2 073 672 1 129 796 Fee and commission income 4 1 334 892 1 004 291 Fee and commission expense 5 (247 575) (117 621) Net fee and commission income 1 087 317 886 670 Dividend income 6 337 623 243 055 Result on financial instruments at fair value 7 (8 671) 44 380 Result on investment securities 8 80 495 10 651 Foreign exchange result 265 252 136 883 Other operating income 9 115 340 51 953 Other operating expense 9 (38 083) (28 094) Net other operating income 77 257 23 859 Net provision charges for financial assets and contingent liabilities and commitments 10 (94 875) (76 668) Administrative costs 11 (1 714 595) (1 112 462) Operating profit 2 103 475 1 286 164 Profit before income tax 2 103 475 1 286 164 Income tax expense (336 994) (217 920) Net profit 1 766 481 1 068 244
Earning per share (in PLN per share) basic 12 6,74 6,39 diluted 12 6,73 6,39
WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
BALANCE SHEET
Note 30.06.2008 31.12.2007 ASSETS Cash and amounts due from Central Bank 7 407 392 5 082 829 Debt securities eligible for rediscounting at Central Bank 2 618 1 108 Loans and advances due from banks 13 8 702 814 17 551 065 Financial assets held for trading 14 2 842 790 2 828 802 Derivative financial instruments 15 2 186 208 1 917 960 Other financial instruments at fair value through profit or loss 16 3 873 138 3 777 679 Loans and advances to customers 17 66 692 356 63 955 254 Hedging derivative financial instruments 18 24 312 40 672 Investment securities 19 18 681 716 17 715 886 1. Available for sale 17 925 101 17 128 996 2. Held to maturity 756 615 586 890 Non current assets held for sale 20 137 393 514 Investments in subsidiaries 21 1 631 876 1 631 694 Investments in associates 22 56 755 56 530 Intangible assets 23 665 660 668 183 Tangible fixed assets 24 1 757 580 1 908 424 Investment properties 25 54 266 55 730 Income taxes 440 244 349 412 1. Current tax assets 2. Deferred income tax assets 440 244 349 412 Other assets 1 400 281 2 026 814 TOTAL ASSETS 116 557 399 119 568 556 LIABILITIES Liabilities Amounts due to the Central Bank 1 360 105 1 485 921 Amounts due to other banks 26 7 795 249 6 884 279 Financial liabilities held for trading 27 239 324 491 382 Derivative financial instruments 15 2 194 956 1 683 306 Amounts due to customers 28 86 263 706 89 160 124 Debt securities issued 29 2 136 837 2 097 070 Hedging derivative financial instruments 18 126 057 29 083 Current income tax liabilities 173 501 51 793 Provisions for deferred income tax Provisions 30 353 422 374 998 Other liabilities 2 512 147 2 932 216 Total liabilities 103 155 304 105 190 172 Equity Share capital 31 262 213 261 867 Other capital and reserves 31 11 373 401 12 109 917 Prior and current year profits 31 1 766 481 2 006 600 Total equity 13 402 095 14 378 384 TOTAL LIABILITIES 116 557 399 119 568 556
2 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
STATEMENT OF CHANGES IN EQUITY For the period from 1 st January 2008 to 30 th June 2008 and for the period from 1 st January 2007 to 30 th June 2007
Share Other reserve capital, of which: Priori and Total equity capital Total reserves Share General other reserve Revaluation Exchange Other current year premium banking risk capital reserves from differences profit fund financial from instruments translation of foreign entities Equity as at 1 st January 2008 261 867 12 109 917 9 063 248 1 237 850 1 855 533 (278 058) (678) 232 022 2 006 600 14 378 384 Management options 346 43 245 42 025 - - - - 1 220 - 43 591 Options exercised (share issue) 346 42 025 42 025 - - - - - 42 371 Revaluation of management share options 1 220 - - - - - 1 220 - 1 220 Valuation of financial instrument - (268 700) - - - (268 700) - - - (268 700) Revaluation of available –for sale (210 743) - (210 743) - - - (210 743) investments net of deferred tax Revaluation of hedging financial (57 957) - (57 957) - - - (57 957) instruments net of deferred tax Appropriation of retained earnings and - (510 641) - - (510 641) - - - 240 119 (750 760) current year profit Dividend paid (1 032 357) (1 032 357) - - - (1 484 884) (2 517 241) Profit appropriation 521 716 521 716 - - - (521 716) - Current year net profit - - - - 1 766481 1 766 481 Other - (420) - - - - (420) - - (420) Foreign exchange differences from (420) - - ( 420) - - (420) translation of foreign entities Equity as at 30 th June 2008 262 213 11 373 401 9 105 273 1 237 850 1 344 892 (546 758) (1 098) 233 242 1 766 481 13 402 095
3 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
Share Other reserve capital, of which: Priori and Total equity capital Total reserves Share premium General other reserve Revaluation Exchange Other current year banking risk capital reserves from differences from profit fund financial translation of instruments foreign entities Equity as at 1 st January 2007 166 808 6 724 818 1 395 885 1 137 850 3 992 997 (15 141) 555 212 672 1 728 539 8 620 165 Management options 295 33 522 31 623 - - - - 1 899 - 33 817 Options exercised (share issue) 295 31 623 31 623 - - - - - 31 918 Revaluation of management share options 1 899 - - - - - 1 899 - 1 899 Valuation of financial instrument - (117 830) - - - (117 830) - - - (117 830) Revaluation of available –for sale (117 830) (117 830) (117 830) investments net of deferred tax Appropriation of retained earnings and - 224 611 - 100 000 109 611 - - 15 000 (660 295) (435 684) current year profit Dividend paid ------(1 503 928) (1 503 928) Profit appropriation 224 611 - 100 000 109 611 - - 15 000 ( 224 611) - Current year net profit ------1 068 244 1 068 244 Other - (285) - - - - (285) - - (285) Foreign exchange differences from (285) (285) (285) translation of foreign entities Equity as at 30 th June 2007 167 103 6 864 836 1 427 508 1 237 850 4 102 608 (132 971) 270 229 571 1 068 244 8 100 183
4 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
CASH FLOW STATEMENT I Half 2008 I Half 2007
Cash flow from operating activities - indirect method Net profit 1 766 481 1 068 244 Adjustments: (2 911 428) 1 725 737 Amortization 183 261 151 400 (Profit) loss on foreign exchange differences 169 251 106 874 (Profit) loss on investing activities (80 586) (20 858) Impairment 2 002 Interest and dividend (440 509) (631 541) Change in loans and advances to banks 1 920 411 (125 993) Change in financial assets as held for trading and other financial instruments at fair value (109 447) 827 533 Change in derivative financial instruments (268 248) (163 697) Change in loans and advances to customers (2 738 612) (997 778) Change in investment securities available for sale (1 141) (3 979) Change in deferred income tax assets (27 791) (3 252) Change in other assets 528 851 (80 228) Change in amounts due to banks 785 154 3 034 902 Change in liabilities as held for trading (252 058) (77 178) Change in derivative financial instruments and other financial liability at fair value 511 650 172 096 Change in amounts due to customers (2 896 418) (229 813) Change in debt securities in issue 25 614 Change in provisions (21 576) (4 905) Change in other liabilities (323 487) (110 362) Income tax paid (240 533) (340 657) Current tax 364 786 221 171 Net cash flow from operating activities (1 144 947) 2 793 981 Cash flows from investing activities Investing activity inflows 11 044 852 23 254 617 Sale of shares investment securities 10 581 061 22 650 230 Proceeds from sale of intangible assets and tangible fixed assets 382 271 Other investing inflows 463 409 604 116 Investing activity outflows (12 091 780) (24 291 341) Purchase of subordinated undertakings (5 182) (474 729) Purchase of investment securities (11 962 351) (23 708 784) Purchase of intangible assets and tangible fixed assets (124 247) (107 828) Net cash flow used in investing activities (1 046 928) (1 036 724)
5 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
Cash flows from financing activities Financing activity inflows 200 971 31 918 Issue of debt securities 158 396 Shares issues 42 575 31 918 Financing activity outflows (2 612 372) (1 503 932) Redemption of debt securities (95 131) (4) Dividends and other payments to shareholders (2 517 241) (1 503 928) Net cash flow from financing activities (2 411 401) (1 472 014) Total net cash flows (4 603 276) 285 243 Net change in cash and cash equivalents (4 603 276) 285 243 Cash and cash equivalents at the beginning of the period 16 814 198 10 577 405 Cash and cash equivalents at the end of the period 12 210 922 10 862 648
6 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS
1. Accounting polices
Statement of compliance These condensed interim unconsolidated financial statements were prepared in accordance with the International Accounting Standard 34 “Interim Financial Reporting” as adopted by the European Union and other applicable regulations.
Basis of preparation These condensed interim unconsolidated financial statements have been prepared in accordance with the same accounting policies as presented in the interim consolidated financial statements with the exception of capital investment disclosure rules, described below. Accounting polices are consistent with those applied in the preparation of the Bank’s financial statements for the financial year ended 31 st December 2007.
Investment in subsidiaries, associates and joint ventures Subsidiaries Subsidiaries are the entities over which the Bank has direct or indirect control. Control is the ability to manage financial and operating policies in order to gain economic profits. Control basically is involved with larger number of votes in governing bodies. Control usually is implicated with the possession of the majority of votes in governing bodies. Associates Associated entities are entities over which the Bank has significant influence and are not subsidiaries or joint venture entities. The Bank usually determines significant influence by possession of 20 % to 50 % of the total number of votes in governing bodies. Joint ventures Join venture are entities, which are contractually agreed and in which the split of control over the activities dictates that any strategic financial and operating decisions relating to the activity require the unanimous consent of parties sharing control.
Recognition and valuation Investments in subsidiaries, associates and joint ventures are recorded at cost of purchase less impairment if any. The carrying value is subject to tests for impairment in accordance with IAS 39. Any impairment is recognized in the profit and loss account as “Net provision charges for financial assets and contingent liabilities and commitments”. Dividends are recognized in the profit and loss account when the Bank obtains legal rights to receive them.
Moreover equity investments in foreign entities represent non-monetary assets. Non-monetary assets are measured in accordance with historical cost expressed in the foreign currency and translated on the base of exchange rate from the transaction date. Investment in foreign entities purchased before IFRS adoption is calculated on the basis of balance sheet value as of the day of the transition into IFRS. Condensed interim financial statements are presented in Polish zloty, and all amounts, unless indicated otherwise, are stated in PLN thousand.
7 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
2. Interest income I Half 2008 I Half 2007 Income on placements in other banks 294 033 240 423 Income on other placements on money market 85 973 14 351 Income on loans and advances to customers 2 660 418 1 281 589 Income on investment securities 516 200 365 218 Income on financial assets held for trading 78 260 18 539 Income on financial assets designated at fair value through profit and loss 114 204 47 626 Total 3 749 088 1 967 746 I półrocze 2008 I półrocze 2007 3. Interest expenses I Half 2008 I Half 2007 Expense on other bank’s deposits (120 705) (43 648) Expense on other deposits on the money market (142 208) (58 547 Expense on customer’s deposits (1 228 930) (575 702) Expense on obtained loans (134 440) (134 149) Expense due to the amortization of premium on investment securities (22 413) (25 904) Expense on debt securities (26 720) Total (1 675 416) (837 950)
4. Fee and commission income I Half 2008 I Half 2007 Accounts maintenance and payment orders 506 642 310 053 Payment cards 395 508 222 846 Acquisition services 185 633 332 794 Credits and loans granted 128 571 94 135 Custody activity 31 893 15 084 Guarantees and similar operations 18 847 11 441 Securities operations 18 574 2 619 Other 49 224 15 319 Total 1 334 892 1 004 291
5. Fee and commission expense I Half 2008 I Half 2007 Payment cards (200 871) (100 047) Securities operations (4 385) (2 234) Custody activity (2 467) (1 382) Acquisition services (13 175) (5 084) Transfers (11 291) (3 529) Accounts maintenance (1 168) (1 254) Other (14 218) (4 091) Total (247 575) (117 621)
6. Dividend income I Half 2008 I Half 2007 Dividend income from the issuers: Subsidiaries 212 719 164 347 Associates 119 964 76 713 Other entitie 4 940 1 995
Total 337 623 243 055
8 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
7. Result on financial instruments valued at fair value a) Result on assets and liabilities held for trading I Half 2008 I Half 2007 Derivative instruments 29 412 57 634 Debt Instruments 2 569 28 437
Total 31 981 86 071
b) Result on financial assets and financial liabilities valued at fair value through profit and loss I Half 2008 I Half 2007 Debt Instruments (40 652) (41 691)
Total (40 652) (41 691) Total result on financial instruments valued at fair value (a+b) (8 671) 44 380
8. Result on investment securities
Realized result on financial assets and liabilities other than valued at fair value through profit and loss I Half 2008 I Half 2007 Realized profits Financial assets available for sale 83 877 12 242 Debt securities in issue 387
Total 84 264 12 242
Realized losses Financial assets available for sale (631) (1 591) Debt securities in issue (3 138)
Total (3 769) (1 591)
Net realized profit 80 495 10 651
9. Other operating income and expense I Half 2008 I Half 2007 Other operating income Rent and other revenue 23 570 12 087 Gains on sale of properties and other assets 4 530 11 297 Recovery of prescribed, written off against provisions and bad debts 9 708 6 883 Credit insurance 7 342 7 838 Recovery of debt collection costs 5 899 2 455 Recovery of administrative costs 6 957 2 094 Releases of provisions for other assets 416 2 842 Releases of provisions for liabilities 25 200 33 Compensation, fees and penalties 357 35 Income from waved liabilities 14 354 Other 17 007 6 389 Total 115 340 51 953
9 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
I Half 2008 I Half 2007 Other operating expenses Debt recovery costs (9 175) (5 854) Credit insurance (7 424) (6 416) Donations (2 300) (2 052) Impairment of intangible and tangible fixed assets and other assets (1 122) (467) Customer complaints (2 017) (878) Losses on disposal and liquidation of properties and other assets (760) (1 201) Provision charges for litigation and claims (978) (2 155) Compensation, fees and penalties (157) (97) Debt write off’s (2) (4) Other (14 148) (8 970) Total (38 083) (28 094)
10. Net provision charges for financial assets and contingent liabilities and commitments I Half 2008 I Half 2007 Provision charges Loans and advances (930 176) (904 282) Financial assets available for sale (1) Investments held to maturity (26) (17) Investments in subsidiaries (913) Contingent liabilities and commitments (113 235) (108 077)
Total (1 043 438) (1 013 289)
Provision releases Loans and advances 820 126 819 995 Financial assets available for sale 352 Investments held to maturity 36 52 Contingent liabilities and commitments 128 049 116 574
Total 948 563 936 621 Net provision (94 875) (76 668)
11. Administrative costs I Half 2008 I Half 2007 Payroll and employee benefits (844 456) (583 344) including: Wages and salaries (717 014) (481 594) Insurance and other charges related with employees (126 222) (99 851) Cost of share based payments (1 220) (1 899) Other administrative costs (647 547) (362 221) Amortization and depreciation (183 261) (151 400) Taxes and charges (18 264) (11 322) Annual Bank Guarantee Fund fee (7 907) (4 175) Polish Financial Supervision Authority (PFSA) fee (13 160) Total (1 714 595) (1 112 462)
10 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
12. Earnings per share
Basic earnings per share Basic earnings per share are calculated by dividing net profit by the average weighted number of ordinary shares listed during a given period. I Half 2008 I Half 2007 Net profit 1 766 481 1 068 244 Weighted average number of ordinary shares in the period 262 147 533 167 052 213 Earnings per each share (in PLN per share) 6.74 6.39
Diluted earnings per share Diluted earnings per share are calculated based on the respective profit of ordinary shareholders of the holding company by dividing the profit of such shareholders by the average weighted number of ordinary shares listed during a given period, adjusted for all potentially diluting ordinary shares. There are diluting instruments in the Bank in the form of convertible bonds. For calculation purposes, it is assumed that these bonds will be converted into shares. I Half 2008 I Half 2007 Net profit 1 766 481 1 068 244 Weighted average number of ordinary shares in the period 262 147 533 167 052 213 Adjustments to the number of shares for the purpose of calculating the diluted earnings per share 148 976 193 423 Weighted average number of ordinary shares for the purpose of calculation of diluted earnings per share 262 296 509 167 245 636 Diluted earnings per each share (PLN per share) 6.73 6.39
13. Loans and advances due from banks 30.06.2008 31.12.2007 Current account 1 637 261 4 251 495 Deposits and advances from other banks 4 297 418 7 753 893 Loans and advances 1 801 290 1 566 368 Unquoted securities 12 783 13 684 Repo transactions 634 943 2 564 669 Funds in transit 293 588 1 345 259 Interest 57 534 84 992 Total gross 8 734 817 17 580 360 Impairment provisions (32 003) (29 295)
Total net 8 702 814 17 551 065
14. Financial assets held for trading 30.06.2008 31.12.2007 Debt securities issued by the State Treasury 1 975 529 1 975 575 issued by other banks 279 566 101 376 issued by non financial entities 265 622 260 794 issued by non bank financial entities 322 073 491 057
Total 2 842 790 2 828 802
11 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
15. Derivative financial instruments Nominal values Fair value Fair value 30.06.2008 of base (negative) (positive) instruments Currency transactions Currency swaps 23 530 505 (90 788) 255 670 Currency forward contracts 17 842 653 (245 584) 196 593 Currency options 21 795 410 (150 470) 137 634 Cross Currency IRS 13 663 083 (231 548) 231 062 Interest rate transactions Interest rate swaps (IRS) 113 472 291 (1 244 496) 1 119 329 Forward Rate Agreement (FRA) 48 211 308 (52 645) 65 807 Futures for debt securities 1 043 216 Cap/Floor 1 833 250 (11 901) 11 075 Other transactions Securities forward contracts 1 680 264 (1 168) 1 917 Share options 3 484 984 (166 356) 167 121 Total 246 556 964 (2 194 956) 2 186 208
31.12.2007 Nominal values Fair value Fair value of base (negative) (positive) instruments Transakcje walutowe Currency transactions 36 865 267 (144 198) 239 281 Currency swaps 39 849 948 (273 690) 365 126 Currency forward contracts 22 943 278 (120 492) 116 990 Currency options 9 645 044 (113 670) 210 514 Cross Currency IRS Interest rate transactions 123 373 520 (724 642) 676 039 Interest rate swaps (IRS) 62 774 180 (52 657) 61 368 Forward Rate Agreement (FRA) 650 772 Futures for debt securities 1 557 683 (17 309) 13 714 Cap/Floor Other transactions 487 092 (1 752) 103 Securities forward contracts 3 620 553 (234 896) 234 825
Total 301 767 337 (1 638 306) 1 917 960
16. Other financial instruments measured at fair value through profit and loss 30.06.2008 31.12.2007 Debt securities issued by non bank financial entities 465 669 538 986 issued by the State Treasury 3 407 469 3 238 693 Total 3 873 138 3 777 679
Debt securities have been designated by the Bank as at fair value through profit and loss among other in order to eliminate or significantly reduce a measurement or recognition inconsistency between debt securities and derivatives economically hedging interest rate risk attributable to the debt securities.
12 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
17. Loans and advances to customers 30.06.2008 31.12.2007 Loans 66 519 300 66 417 115 Payment cards receivables 628 185 510 444 Purchased receivables 464 527 393 896 Realized guarantees and commitments 37 171 40 366 Unquoted securities 60 082 60 993 Repo transactions 800 845 732 997 Receivables in transit 1 564 353 62 097 Interest 210 055 196 963 Total gross 70 284 518 68 414 871 Provision for the impairment of receivables (3 592 162) (4 459 617) Total net 66 692 356 63 955 254 18. Cash flow hedge (macro hedge) The hedge relationship description The Bank through the derivative interest rate swap (IRS) transactions hedges a part of it’s interest rate risk exposure arising from the volatility of the cash flows related to the variable interest Polish zloty assets (with the exception of the debt securities classified as held to maturity). Hedged items Cash flows arising from variable rate assets Hedging instruments A portfolio of IRS transactions (a short position – the Bank receives fixed flow of payments and pays a variable flow). As at 30 June 2008 the net fair value of the hedging instruments amounted to PLN (101 745) thousand (as at 31 December 2007 PLN +11 589 thousand). Balance sheet disclosure The effective part of the hedging instruments valuation is recognized in revaluation equity. Interest on hedged items and hedging instruments is recognized as interest income.
30.06.2008 31.12.2007 Gross revaluation equity (deferral of the P&L (133 327) (61 776) recognition of the changes in the fair value of hedging instrument of the effective hedge) Period in which the cash flows related to the hedged 01.07.2008 20.11.2017 01.01.2008 20.11.2017 items are expected to occur.
13 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
19. Investment securities 30.06.2008 31.12.2007 Securities available for sale 17 943 723 17 144 164 Debt securities 17 926 597 17 131 729 issued by central banks 560 082 554 092 issued by other banks 1 405 754 1 483 933 issued by non bank financial entities 193 869 230 452 issued by non financial entities 818 410 619 783 issued by the State Treasury 14 596 356 13 834 692 issued by local governments 352 126 408 777 Stock and shares in other entities 17 126 12 435 Securities held to maturity 756 702 586 994 issued by central banks 277 515 394 381 issued by other financial entities 15 095 17 277 issued by the State Treasury 464 092 175 336 Total gross 18 700 425 17 731 158 Impairment of securities available for sale (18 622) (15 168) Impairment of securities held to maturity (87) (104) Total net 18 681 716 17 715 886 20. Non – current assets held for sale In accordance with IFRS5 "Non-current Assets Held for Sale and Discontinued Operations", the Bank classified fixed assets and assets included in the disposal group, which meet the criteria of classification held for sale, in the separate balance sheet item. As of June 2008 these include a portfolio of receivables, real estates and the other fixed assets. The receivables will be sold to a securitisation fund. The portfolio includes corporate and SME loans. The Bank expected that the transaction will be closed by the end of 2008, after obtaining a binding offer from investors. Real estate held for sale includes property located in Towarowa Street in Warsaw, on which the preliminary purchase contract was executed with Bank BPH S.A. The realization of the sale will occur after meeting all the necessary conditions for the contract. The Bank expected that the transaction will be closed by the end of 2008. Moreover, certain real properties and the other fixed assets owned by the Bank were classified as held for sale. Non-current assets held for sale: 30.06.2008 31.12.2007 Receivables from customers 41 869 Properties 95 524 514 Total 137 393 514
Changes during the first half of 2008 Receivables from Property customers Opening balance 514 - Increase: 96 128 41 869 Transfer from investment properties 915 Transfer from tangible assets 95 213 Transfer from loans and advances to customers 41 869 Decrease: (1 118) Asset disposal (1 118) Closing balance 95 524 41 869
14 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
The disposals of properties during the first half of 2008 were settled as follows:
Income from sale 534 Book value of sold net assets (including costs of sales) 1 118 Profit / Loss on sale (584) Changes in value of 2007 Property Shares Opening balance 8 784 - Increase: 4 134 820 Transfer from investment properties Transfer from tangible assets 2 639 Transfer from investments in subordinated undertakings 820 Foreign exchange differences 11 Other changes 1 484 Decrease: (12 404) (820) Disposals (12 194) (820) Other changes (210) Closing balance 514 -
During 2007 the Bank disposed of 55.25% of shares of it’s subsidiary Pekao Access Spolka z o.o. The disposals were settled as follows: Property Shares Total Income from sale 39 453 820 40 273 Book value of sold net assets (including 12 195 820 13 015 costs of sales) Profit / Loss on sale 27 258 27 258
21. Investments in subsidiaries 30.06.2008 31.12.2007 Banks 891 038 891 037 Other financial entities 700 549 700 550 Non financial entities 40 289 40 107 Total 1 631 876 1 631 694
22. Investments in associates 30.06.2008 31.12.2007 Banks Other financial entities 47 860 42 860 Non financial entities 8 895 13 670 Total 56 755 56 530
23. Intangible assets 30.06.2008 31.12.2007 a)intangible assets. including: 613 985 616 508 development costs 7 907 14 428 licenses 398 782 419 509 items unduly the expenses on intangible assets and 200 015 177 819 prepayments on intangible assets other 7 281 4 752 b) goodwill 51 675 51 675
Total 665 660 668 183
Goodwill of PLN 51 675 thousand - represents goodwill which has been transferred to Pekao on integration with Bank BPH S.A. 15 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
This represents goodwill arising on Bank BPH S.A.’s acquisition of Pierwszy Komercyjny Bank S.A. “PKBL” w Lublinie and relates to those branches of the former PKBL which have been transferred to the Bank in effect of the Integration of the Banks.
24. Tangible fixed assets 30.06.2008 31.12.2007 Property, plant and equipment : a) fixed assets, including: 1 734 730 1 862 708 Land and buildings 1 336 782 1 462 525 Machinery and equipment 345 101 345 157 Means of transport 27 760 29 166 Other property. plant and equipment 25 087 25 860 b) Capital work in progress and prepayments for capital 22 850 45 716 work in progress Total 1 757 580 1 908 424 25. Investment properties 30.06.2008 31.12.2007 Land 7 627 8 088 Buildings 46 639 47 642 Total 54 266 55 730
26. Amounts due to other banks 30.06.2008 31.12.2007 Current accounts 2 742 281 1 168 399 Bank deposits and other liabilities 2 256 944 3 299 635 Loans and advances 754 367 820 951 Due in transit 704 861 495 952 Repo transactions 1 327 228 1 083 127 Interest accrued 9 568 16 215 Total 7 795 249 6 884 279
27. Financial liabilities held for trading 30.06.2008 31.12.2007 Short position in securities 239 324 491 382 Total 239 324 491 382
16 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
28. Amounts due to customers 30.06.2008 31.12.2007 Amounts due to corporate customers 37 534 803 42 275 767 Funds at current accounts and overnight deposits 19 939 607 21 956 454 Time credits, deposits and other liabilities 16 723 064 19 622 995 Due in transit 793 787 636 414 Interest accrued 78 345 59 904 Amounts due to budget entities 6 709 728 8 465 130 Funds at current accounts and overnight deposits 4 613 031 6 260 322 Time deposits and other liabilities 2 087 392 2 187 383 Due in transit 6 713 Interest accrued 9 305 10 712 Amounts due to individuals 38 319 618 35 712 058 Funds at current accounts and overnight deposits 17 513 170 18 061 507 Time deposits and other liabilities 20 190 052 17 569 942 Due in transit 494 407 2 Interest accrued 121 989 80 607 Repo transactions 3 699 557 2 707 169 Time transactions 3 691 651 2 703 862 Interest accrued 7 906 3 307 Total 86 263 706 89 160 124
29. Debt securities issued 30.06.2008 31.12.2007 Bonds convertible into shares 31 850 31 978 Certificates of deposit 2 086 778 2 049 587 Interest accrued 18 209 15 505
Total 2 136 837 2 097 070
The Bank never has defaulted on repayment of principal or interest or redemption of its own securities.
30. Provisions
I Half 2008 Provision for Provision Provision for Other Total litigation and for undrawn credit provision claims retirement facilities and benefits guarantees issued Balance as at 1 st January 2008 53 971 113 511 186 161 21 355 374 998 Provision charges 978 3 771 113 235 1 905 119 889 Provision utilization (6 124) (6 124) Provision releases (4 588) (128 049) (132 637) Foreign exchange differences (199) 1 485 1 286 Other changes (1 767) (2 223) (3 990) Balance as at 30 th June 2008 42 271 117 282 170 609 23 260 353 422
17 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
2007 Provision Provision for Provision for Other Total for retirement undrawn credit provisions litigation benefits facilities and and claims guarantees issued Balance as at 1 st January 2007 40 399 64 211 112 591 3 811 221 012 Merger of “Pekao 285” 20 287 25 983 52 419 98 689 Provision charges 2 797 23 317 240 472 17 544 284 130 Provision utilization (2 793) (2 793) Provision releases (8 032) (221 403) (229 435) Foreign exchange differences 1 731 2 082 3 813 Other changes (418) (418) st Balance as at 31 December 2007 53 971 113 511 186 161 21 355 374 998
31. Equity 30.06.2008 31.12.2007 Share capital 262 213 261 867 Supplementary capital 9 294 580 9 252 555 Share premium 9 105 273 9 063 248 Other 189 307 189 307 Revaluation reserve (547 856) (278 736) Revaluation of the portfolio of financial assets available for sale (541 018) (280 829) Deferred tax 102 255 52 810 Revaluation of the portfolio of hedging instruments (133 327) (61 776) Deferred tax 25 332 11 737 Other (1 098) (678) General banking risk fund 1 237 850 1 237 850 Brokerage activity fund 15 000 15 000 Other reserve capital 1 344 892 1 855 533 Bonds convertible on shares –capital item 28 935 27 715 Prior year profit (loss) Profit for the year 1 766 481 2 006 600
Total 13 402 095 14 378 384
32. Contingent liabilities and insurance contracts Financial liabilities granted 30.06.2008 31.12.2007 Financial liabilities granted: 31 804 402 34 314 599 towards financial entities 1 748 730 2 726 872 towards non financial entities 29 100 453 29 315 970 towards the budget 955 219 2 271 757 Including: granted irrevocable contingent liabilities and commitments 30 886 413 33 470 402
Guarantees liabilities granted 30.06.2008 31.12.2007 1) Liabilities granted towards financial entities: 225 889 267 553 guarantees 221 586 245 265 confirmed export letters of credit 4 303 22 288 2) Liabilities granted towards non financial entities: 3 882 268 3 871 799 guarantees 3 882 261 3 871 752 sureties 7 47 3) Liabilities granted towards the budget: 20 318 193 884 guarantees 20 318 193 884 Total 4 128 475 4 333 236 18 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
33. Dividend paid
Dividends and other distribution to shareholders are recorded directly in equity. A liability for dividends payment is not recognized until the Bank has an obligation to pay dividends, which is not until they are approved. During the ordinary Shareholders Meeting of Bank Pekao S.A. on 23 rd April 2008 a resolution was made to pay out a dividends for the year ended as at 31 st December 2007 in the amount of PLN 9.60 per share, what gives a total amount of dividend of PLN 2 517 241 thousand. In determining the 2007 dividend amount the Bank took into account the number of shares eligible - after the merger of Bank Pekao S.A. with the separated part of Bank BPH S.A. hereinafter called as “Pekao 285” - for dividend paid out starting from 1 January 2008. As such, the amount of dividend payment was assessed in consideration of the combined results generated in 2007 by both Bank Pekao S.A. and Pekao 285 operating under the structure of Bank BPH until the spin off. The ex-dividend date was 15th May 2008 and the dividend was paid on 3rd June 2008. All the Bank’s shares are ordinary shares.
34. Litigation
As at 30 June 2008 the number of the legal proceedings in courts appropriate bodies of concerning the liabilities of the Bank was 471 the total value of them was PLN 758 298 thousand, (as at 31 December 2007 there were 715 court proceedings amounting on PLN 777 189 thousand). As at 30 June 2008 estimated provisions of PLN 42 271 thousand have been established where legal council estimates it is probable that financial settlement will be necessary (PLN 53 971 thousand at 31 December 2007). As regards all other significant proceedings in progress against the Bank, the risk of cash outflow is remote.
19 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
35. Transactions with related parties Transactions with related entities as at 30.06.2008: Entity name Dues from Securities Financial derivatives Other dues Dues to loans Financial Other dues to loans and contracts from and advances derivatives advances contracts Group parent company UniCredito Italiano S.p.A. 284 294 56 595 945 Entities of UniCredit Group’s excluding entities of Pekao S.A. Group 454 877 188 477 22 272 1 793 381 122 570 46 Subsidiaries UniCredit Bank Ltd. 1 556 525 4 853 828 Pekao Leasing Sp. z o.o. 884 194 73 836 18 166 Pekao Faktoring Sp. z o.o. 434 590 34 697 1 154 Centralny Dom Maklerski S.A. 1 070 798 441 Pekao Fundusz Kapitałowy Sp. z o.o. 66 511 Pekao Pioneer Powszechne Towarzystwo Emerytalne S.A. 198 9 503 Pekao Telecentrum Sp. z o.o. (ex. Drukbank Sp. z o.o.) 8 655 Centrum Kart S.A. 483 22 679 6 853 Pekao Financial Services Sp. z o.o. 8 201 3 Pekao Bank Hipoteczny S.A. (ex. BPH Bank Hipoteczny S.A 207 399 210 243 2 492 8 192 35 434 Pekao Leasing Holding S.A. (ex. BPH PBK Leasing S.A.) 212 413 129 410 259 2 890 259 7 544 Property Sp. z o.o. (in liquidation) 3 327 Final Holding Sp. z o.o. 143 BPH Real Estate S.A. 2 185 Centrum Usług Księgowych Sp. z o.o 60 Centrum Bankowości Bezpośredniej Sp.z o.o. - - 3 590 Associates - Pirelli Pekao Real Estate Sp. z o.o. 63 379 Xelion. Doradcy Finansowi Sp. z o.o. 6 852 Pioneer Pekao Investment Management S.A. 220 167 Krajowa Izba Rozliczeniowa S.A. 1 685 Bankowe Doradztwo Podatkowe Sp. z o.o. 136 Key managing Staff of the Bank or it’s Parent Company 17 742 4 600 Razem 4 052 034 339 653 191 301 22 953 3 393 915 158 263 35 980
20 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
Transactions with related entities as at 31.12.2007: Entity name Dues from loans and Securities Financial derivatives Other dues Dues to loans Financial Other dues to advances contracts from and advances derivatives contracts Group parent company UniCredito Italiano S.p.A. 1 589 380 23 985 592 901 18 541 13 754 Entities of UniCredito Italiano Group’s excluding entities of Pekao S.A. Group 2 360 425 397 440 283 162 2 081 909 83 316 637 161 Subsidiaries UniCredit Bank Ltd. (ex. Bank Pekao (Ukraina) Ltd.) 881 099 149 1 204 224 Pekao Leasing Sp. z o.o. 884 569 77 736 88 122 15 781 Pekao Faktoring Sp. z o.o. 505 961 2 489 Centralny Dom Maklerski S.A. 26 804 803 495 3 928 Pekao Fundusz Kapitałowy Sp. z o.o. 64 966 Pekao Pioneer Powszechne Towarzystwo Emerytalne S.A. 175 14 578 Drukbank Sp. z o.o. 8 462 Centrum Kart S.A. 22 289 7 458 Pekao Financial Services Sp. z o.o. 9 484 BPH Bank Hipoteczny S.A. 183 835 211 664 746 10 939 28 386 BPH PBK Leasing S.A. 247 327 107 733 2 912 8 537 PBK Property Sp. z o.o. 3 112 Final Holding Sp. z o.o. 189 BPH Real Estate S.A. 38 Centrum Usług Księgowych Sp. z o.o. 32 Associates Pirelli Pekao Real Estate Sp. z o.o. 89 157 Xelion. Doradcy Finansowi Sp. z o.o. 3 047 Pioneer Pekao Investment Management S.A. 214 999 Krajowa Izba Rozliczeniowa S.A. 26 162 Bankowe Doradztwo Podatkowe Sp. z o.o. 53 Key managing Staff of the Bank or it’s Parent Company 12 376 - - - 10 415 - - Total 6 664 972 319 397 422 248 311 026 3 962 921 130 365 686 843
21 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
Income and expenses from transactions with related entities in the first half of 2008 Interest Interest Fee and Fee and Other Other income expense commission commission income expense Entity name income expense
Group parent company 7 651 (161) 3 916 (826) 1 192 (7 800) Entities of UniCredit Group’s excluding entities of Pekao S.A. Group’s 32 038 (47 512) 165 834 (624) 10 698 (39 654)
Entities of Pekao S.A. Group’s Subsidiaries UniCredit Bank Ltd. 25 447 (30) (3) Centralny Dom Maklerski Pekao S.A. (33 653) 1 322 (16) 1 606 (2 449) Pekao Leasing Sp. z o.o. 25 912 (568) 90 352 (77) Pekao Faktoring Sp. z o.o. 11 631 (4) 430 (1) 27 Pekao Pioneer Powszechne Towarzystwo Emerytalne S.A. (308) 1 833 Pekao Fundusz Kapitałowy Sp. z o.o. (1 836) 1 7 Centrum Kart S.A. (685) 9 587 (22 839) Pekao Telecentrum Sp. z o.o. (ex. Drukbank Sp. z o.o.) (234) 1 Pekao Financial Services Sp. z o.o. (256) 4 (14) BPH Bank Hipoteczny S.A. 9 019 (148) 45 109 (6 767) Pekao Leasing Holding S.A. (ex. BPH PBK Leasing S.A.) (3) Pekao Leasing i Finanse S.A. (ex. BPH Leasing S.A.) 5 450 (80) 110 1 121 (106) Pekao Auto Finanse S.A. (ex. BPH Auto Finanse S.A.) 3 933 (350) 106 15 (90) Centrum Bankowości Bezpośredniej Sp. z o.o. (39) 1 945 (52) Centrum Usług Księgowych Sp. z o.o. 1 Metropolis Sp. z o.o. 23 Property Sp. z o.o. (in liquidation) (48) BPH Real Estate S.A. (34) 1 Final Holding Sp. z o.o. 1
22 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
Income and expenses from transactions with related entities in the first half of 2008 Interest Interest Fee and Fee and Other Other Entity name income expense commission commission income expense income expense Entities of Pekao S.A. Group’s Associates Pioneer Pekao Investment Management S.A. (6 259) 380 Xelion. Doradcy Finansowi Sp. z o.o. 7 (54) 16 (44) 54 Krajowa Izba Rozliczeniowa S.A. (560) 4 (3 536) Pirelli Pekao Real Estate Sp. z o.o (2 354) 10 2 (197) Bankowe Doradztwo Podatkowe Sp. z o.o. (1) 17 Total entities of Pekao S.A. Group’s 81 399 (47 504) 4 364 (78) 4 866 (36 113) Key managing staff of the Bank or it’s Parent Company 549 (174) 5 (2) Total related entities 121 637 (95 351) 174 119 (1 528) 16 756 (83 569)
23 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
Income and expenses from transactions with related entities in the first half of 2007 Interest Interest Fee and Fee and Other Other Entity name income expense commission commission income expense income expense Group parent company 6 040 (6) 215 (678) 16 (7 205) Entities of UniCredit Group’s excluding entities of Pekao S.A. Group’s 21 058 (6 539) 299 091 (2 625) 34 216 (3 249)
Entities of Pekao S.A. Group’s Subsidiaries UniCredit Bank Ltd. 2 744 (16) 408 (352) Komercyjny Bank HVB Bank Ukraina S.A. (2) Centralny Dom Maklerski Pekao S.A. 1 (23 304) 1 875 (51) 1 802 (49) Pekao Leasing Sp. z o.o. 20 169 (359) 77 169 (46) Pekao Faktoring Sp. z o.o. 5 788 (5) 438 (1) 27 Pekao Fundusz Kapitałowy Sp. z o.o. (836) 2 7 Pekao Pioneer Powszechne Towarzystwo Emerytalne S.A. (219) 1 445 27 Centrum Kart S.A. (453) 13 599 (19 592) Drukbank Sp. z o.o. (98) 1 Pekao Financial Services Sp. z o.o. (152) 4 (19) Pekao Access Sp. z o.o. (1) 2 Associates Pioneer Pekao Investment Management S.A. (2 601) 607 Xelion. Doradcy Finansowi Sp. z o.o. (247) 16 (127) 58 Krajowa Izba Rozliczeniowa S.A. (34) 3 (2 509) Pirelli Pekao Real Estate Sp. z o.o (1 644) 26 (5) 3 (579) Total entities of Pekao S.A. Group’s 28 702 (29 969) 4 917 (557) 2 692 (22 775) Key managing staff of the Bank or it’s Parent Company 174 (39) Other related entities 2 Total related entities 55 974 (36 553) 304 225 (3 860) 36 924 (33 229)
24 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish (in PLN thousand)
The off-balance sheet exposure related to: financing of related entities as at 30 th June 2008 amounted to PLN 1 354 048 thousand (as at 31 st December 2007 PLN 1 114 090 thousand); related to guarantying as at 30 th June 2008 amounted to 27 267 thousand (as at 31 st December 2007 PLN 156 691 thousand); credit cards limits towards related entities as at 30 th June 2008 amounted to PLN 10 thousand (as at 31 st December 2007 PLN 72 thousand).
36. Events after the balance sheet date Sale of shares in related entity On 4 th August 2008 the Bank sold in favour of the natural person seventy four shares of Bankowe Doradztwo Podatkowe Ltd. with the total par value of PLN 37 370, comprising a 74.00% stake in the Company’s share capital and representing the same number of votes at the shareholders meeting (but only 48.65% of total number of votes), for the price of PLN 37 370 which was the equivalent of the net book value on the balance sheet of Bank. Agreement regarding put and call options of Bank shares On 2nd September 2008 the Bank has received information that UniCredit S.p.A. and Ministry of the State Treasury („MST”) have signed agreement regarding put and call options of Bank shares held by MST. On the basis of this agreement the MST shall have a Put Option, while UniCredit shall have a Call Option, with respect to the shares held by the MST in Bank and summing up to approximately 3.95% of Bank’s share capital. According to this agreement, in both cases of options the price will be calculated as the volume- weighted average of the official daily quotations of Bank’s shares on the Warsaw Stock Exchange S.A. for a period of six months preceding the date of exercise of the option, increased by 3%. The put option may be exercised by the MST since the date of signing of the agreement to 30th June 2009, whilst the call option may be exercised by UniCredit S.p.A. since 23 rd December 2008 until 23 23 rd December 2009. The MST shall have the right to terminate the agreement unilaterally until 22 nd December 2008. Upon the signing of the agreement, the Privatization Agreement dated the 23 rd June 1999 regarding Bank Polska Kasa Opieki S.A., the Privatization Agreement dated the 22 nd October 1998 regarding Bank BPH S.A. and the Agreement regarding Bank Pekao S.A. and Bank BPH S.A. between the MST and UniCredit S.p.A. dated the 19 th April 2006 shall be deemed fully completed. Interim dividend payment for the Bank On 18 August 2008 the Management Board of Centralny Dom Maklerski Pekao Spółka Akcyjna approved a resolution to pay an interim dividend for the year 2008 in the amount of PLN 187,800 thousand. The dividend payment will take place within a period of one month from the date of publication of the information on the planned dividend payment in Monitor S ądowy i Gospodarczy (being 5 September 2008).
25 WorldReginfo - e1f746e3-0772-4493-9931-b04487f10014 Condensed Interim Unconsolidated Financial Statements of the Bank Pekao S.A. for the period from 1 st January 2008 to 30 th June 2008 Translation of a document originally issued in Polish
Signatures of all members of the Management Board
22.09.2008 Jan Krzysztof Bielecki President, CEO Date First Name/Family Name Position/Function Signature
22.09.2008 Luigi Lovaglio First Vice President of the Management Board, GM Date First Name/Family Name Position/Function Signature
22.09.2008 Paolo Iannone Vice President of the Management Board Date First Name/Family Name Position/Function Signature
22.09.2008 Andrzej Kopyrski Vice President of the Management Board Date First Name/Family Name Position/Function Signature
22.09.2008 Katarzyna Niezgoda Vice President of the Management Board Date First Name/Family Name Position/Function Signature
22.09.2008 Grzegorz Piwowar Vice President of the Management Board Date First Name/Family Name Position/Function Signature
22.09.2008 Marian Wa Ŝynski Vice President of the Management Board Date First Name/Family Name Position/Function Signature
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