Impact on the social environment

Both the Bank, as part of its sponsorship activities, and the PKO Bank Polski Foundation, as part of its charity activities (Foundation), verify every beneficiary of the support provided. The Bank and the Foundation implement projects jointly and/or separately in the most important programme areas in terms of image, such as sport, culture and education. Furthermore, the Foundation is involved in activities which are focused on social welfare, protection of life and health, and ecology.

For 4th season in a row, the Bank is the titular sponsor of Ekstraklasa, the highest tier of Polish association football. The Bank also engaged in e-sport as part of the Ekstraklasa Games project (FIFA 22 tournament). The main objective of the cooperation is to help the Bank develop the league and young football talents in Poland. The Bank engages clubs, through the Partnership Programme, in the promotion of personal accounts for an appropriate commission. The funds can be allocated by clubs to the development of infrastructure, education of young footballers, sports innovation. In addition, each Supporter has the option to have an official Ekstralasa Card – a payment card with a favourite club crest. This is the only such product on the market. At the same time, as part of the cooperation, the Bank develops “PKO Bank Polski Grajmy Razem (Let’s Play Together)” channels in social media, promotes youth footballers by awarding the best ones every month, and continues the “Kanapa Kibica (Supporter’s Couch)” project, which integrates supporters at every stadium in the country. Since 2022, Supporters and simultaneously the Bank’s customers have been able to purchase tickets for selected matches of PKO Bank Polski Ekstraklasa on the iPKO website.

After a 2-year break, PKO Bieg Charytawny (Charity Run), organized by the Bank in cooperation with the Foundation, also returned to the stadium. Participants in 12 cities, through their activity, supported children’s psychiatry and psychology. The amount of PLN 2,087,335.25 was transferred by PKO Bank Polski Foundation.

The Bank also encouraged people to look after their health and lead a healthy lifestyle by continuing the programme BiegamBoLubię (IRunBecauseILikeTo). It is a series of free of charge running practices for runners at all fitness levels. In 2022, almost 30 thousand runners in nearly 100 stadiums all over Poland took part in the training.

In addition to the running events, the Bank supported yet again a series of international, indoor horse riding competitions known as Cavaliada Tour and the Warsaw Jumping competitions, as well as numerous local events.

The sponsorship of culture and art is one of the main areas of the Bank’s sponsoring activity, as by engaging in valuable cultural events, it makes a real impact on the development of the taste and sensitivity of consumers. Inviting customers to prestigious events allows us to strengthen existing, and build new business relationships. Examples of support for cultural institutions in 2022:

In 2022, the Bank launched the Sponsorship of the National Museum in Wroclaw, which includes the following branches: The National Museum, the Etnographic Museum, the “Racławice Panorama” Museum, and the Four Domes Pavilion Museum of Modern Art.

In 2022, the Bank became a Strategic Partner of the Wawel Royal Castle, one of the most important museums in the country, which was a royal residence for multiple centuries and remains a symbol of Polish state.

Other important events sponsored in 2022 are music festivals in various regions of Poland:

• The “SCHOLA CANTORUM” National Early Music Band Festival,
• The “Musica Sacromontana” Oratory Music Festival in Gostyń Św. Góra,
• International Festival – Days of Orthodox Church Music in Hajnówka.

As one of the leaders in the financial market, the Bank participated actively in organizing congresses and conferences enabling the exchange of experience and solutions among various business environments. Examples of projects with the Bank’s participation:

The Bank, being aware of climate change challenges, supports the energy transformation of Poland and reduces the negative impact of its operating activities on the environment, supports environmental education and day-to-day activities follows the principle of social responsibility. In 2022, the Bank supported the following initiatives: TOGETAIR (Climate Summit and Polish Multimedia Climate Report), Energy Congress in Wroclaw, project of Kurier Lubelski “ECO-LIFE – ECO-EFFECT”, “ESG Talks” debate organised by the Manager publishing house, wGospodarce.pl Green Forum conference, a Wroclaw University of Technology conference “Hydrogen as a remedy for the climate and energy crisis”.

The Bank took an active part in events promoting the development of innovations used in banking and actively supported projects which were aimed at promoting the digital transformation and the development of new technologies:

• Infoshare – the largest conference in Central and Eastern Europe focused on technology, new media and support for young companies.
• UX Poland – one of the largest UX conferences in Europe, concerning User Experience & Product Design, Interaction Designers, Digital Transformation Specialists, and Developers.
• Wolves Summit – an international conference aimed at combining business angels, VC funds, technology talents, investors, and corporations with promising companies in the region,
• Venture Cafe – an initiative aimed at strengthening the innovation ecosystem in Warsaw; the project initiates, creates and implements platform programs, thanks to which cities become friendly ecosystems for innovators and start-ups,
• Day of Women’s Careers in IT – the fourth edition of the online event for all women who wish to enter the IT industry.

The scope of the Foundation’s activities is specified in the Foundation’s Statutes, while the principles of cooperation between the Bank and the Foundation are governed by the agreement. Grants awarded by the Bank were the main source of financing for the Foundation’s statutory objectives in 2022. Additionally, the Bank transfers to the Foundation a part of the profit generated on non-cash transactions with charity cards Inteligo Visa payWave “Goodness pays interest”. The support is designated to one of the four charity initiatives, selected by the customer.

The Foundation also transfers donations in kind to non-governmental organizations in the form of computer hardware and furniture withdrawn from use from various units of the Bank.

Since the first moments of the war in Ukraine, the Bank Group has been involved in various forms of aid. The main efforts of the Bank and its Polish subsidiaries were coordinated by the PKO Bank Polski Foundation (the Foundation) and financed from the Foundation’s resources (including additional funds donated by the Bank for program activities) and from voluntary donor contributions collected in a special bank account of the Foundation. In addition, PKO Bank Polski S.A. made an earmarked donation of PLN 3 million to the Foundation’s account.

Aid efforts carried out from the Foundation’s budget mainly targeted KREDOBANK S.A. employees and their families, who were provided with transportation after crossing the border, accommodation and food, medical care and daily necessities. In addition, a donation was made to the wards to support the process of empowerment of refugees in Poland. A total of 900 people were assisted by the Foundation in 2022, and the value of the aid amounted to nearly PLN 12 million.

From the funds accumulated from voluntary contributions to the Foundation’s account:

• support was provided to 75 non-governmental organizations and units carrying out aid activities for refugees from Ukraine for a total of PLN 8.3 million;
• costs of initiatives for Ukrainian refugees organized locally by PKO Bank Polski S.A. volunteers were covered; the Foundation spent PLN 3.9 million to cover the costs of transporting women and children from Ukraine to Poland, accommodation, purchase of medicines and groceries.

In addition, in 2022, the Foundation made in-kind donations of decommissioned assets acquired from Bank Group’s companies (including minivans, furniture, computers, among others), as well as defibrillators and an ambulance with a total value of PLN 2.1 million.

The Bank’s subsidiaries also made monetary donations and organized the transportation of refugees and the purchase and transportation of items for refugees from their own funds.

KREDOBANK S.A. (a Ukrainian company), including through the activities of the Kredo Foundation, donated a total of UAH 15.8 million (approximately PLN 2 million at the average exchange rate quoted by the National Bank of Poland on 31 December 2022) for war-related humanitarian activities in 2022.

The above funds were transferred:

• as monetary donations – mainly to the State Special Transport Service of the Ministry of Defense of Ukraine for the extension and equipment of the Anti-Mine Action Center and to the city of Lviv for defense and humanitarian needs;
• for the purchase of medical equipment, medicines and food – including but not limited to: for the hospitals of Lviv and Kharkiv;
• to fund the “Brave to Be Together” campaign, as part of which a thousand children evacuated from war zones and occupied territories who went to school for the first time in western Ukraine were prepared for school.
• for the organization and operation of a shelter for refugees from combat areas in Lviv until 30 September 2022 – the shelter accommodated 738 refugees, including 235 children;
• for organizing the transportation of war refugees from eastern Ukraine to Poland.

The Company also helped its employees and their families, in particular in terms of evacuation and accommodation.

Aid campaigns organized by the Bank’s Group in Poland and Ukraine were supported by volunteers – employees of the Group.

Until June 2022, banking services were offered at the PGE National Stadium in Warsaw, where almost 13.5 thousand accounts were opened in a period of more than 2.5 months.

The Bank is offering a promotional Company Account to companies operating in Ukraine or which launched operations in Poland after 24 February 2022 and whose organizational structure includes a minimum of one beneficial owner who is a Ukrainian citizen. The offering is aimed at companies that open PKO Konto Firmowe or PKO Konto Firmowe Premium.

As part of the special offering, customers are exempted for 12 months from, among other things, fees for maintaining a current account and auxiliary accounts, for domestic transfers and transfers to banks in Ukraine, and for withdrawals and deposits at Bank branches. During the period of the special offering, i.e. from 28 March to 31 December 2022, the Bank opened 540 business accounts. 94% of these are newly opened businesses operating in the market for up to 12 months.

PKO Bank Polski S.A., on behalf of the National Bank of Poland, operated the hryvnia exchange as the only bank in Poland until September 2022.

In the period from 25 March to 9 September 2022, in 100 branch offices of the Bank, refugees from Ukraine could exchange hryvnias to Polish zlotys, on specific terms and at the exchange rate quoted by the National Bank of Ukraine (NBU).

Nearly 103 thousand Ukrainian citizen took advantage of this opportunity and exchanged UAH 728 million in total. The average exchange operation amounted to UAH 7 thousand (with a maximum limit of UAH 10 thousand). All hryvnias exchanged were transferred by the Bank to the NBP at the rate quoted by the NBU.

(All figures have been translated using the average exchange rate quoted by the National Bank of Poland on 31 December 2022).

PKO Bank Polski S.A. Group companies, including KREDOBANK S.A. with its registered office in Lviv, and debt collection and financial companies with their registered offices in Kyiv and Lviv, continue to operate in Ukraine.

KREDOBANK S.A. is a universal bank which services customers mainly in the western part of Ukraine and in Kyiv. As at the end of 2022, the Company’s head office was in Lviv; there were 66 branches, 13 of which are located in regions most affected by warfare. In the first quarter of 2022, one of the company’s branches in Kyiv was destroyed.

From February 2022, in connection with the military aggression of Russia, KREDOBANK S.A.’s priority is to ensure the safety of its employees and maintain uninterrupted operations servicing customers on an on-going basis. The Company services customers in regions where no active military actions are in progress. The management monitors the Company’s operations on a daily basis and ensures quick reaction to incidents and changes in the situation.

The Company’s Management Board estimates potential losses at a level which has no impact on KREDOBANK S.A.’s ability to continue its operations. As at the end of 2022, according to an assessment based on the available official information, approximately 16% of the company’s loan portfolio is located directly in or close to areas of hostilities, including less than 3% in areas of temporary occupation or active hostilities;

In 2022, KREDOBANK S.A. granted UAH 4.5 billion (PLN 0.57 billion) in new loans, including 86% to legal persons and 14% to natural persons. Compared to 2021, lending decreased by 69%.

In 2022, KREDOBANK S.A. recognized credit risk allowances of about UAH 1.7 billion (i.e., PLN 213.9 million).

In December 2022, 32 branches of KREDOBANK S.A. became part of POWER BANKING, that is, a joint banking network established at the initiative of the National Bank of Ukraine, i.e. a network of branches scattered throughout Ukraine, with the aim of providing customers with a specific list of urgent banking services, including in the event of a power outage.

KREDOBANK S.A. has signed new loan guarantee agreements that will enable lending to Ukrainian entrepreneurs in 2023, including with the European Bank for Reconstruction and Development (EBRD) and the European Commission, which has allocated funds for Bank Gospodarstwa Krajowego to secure the company’s lending.

The financial and organizational situation of the other Ukrainian companies in the Group was stable at the end of 2022. The companies have not experienced liquidity tensions, and are maintaining relations with existing counterparties. Service restrictions and work organization are being adjusted on an ongoing basis to war conditions.

PKO Bank Polski S.A. has implemented restrictions and changes resulting from sanctions imposed on Russia and Belarus. It has reviewed and changed the directions of settlements with the banks to which the sanctions do not apply, changed the correspondent in Russian roubles (RUB) and terminated the nostro and loro account agreements with the banks covered by sanctions. As a result, the payments in all currencies to and from Russian and Belorussian banks covered by the sanctions have been blocked.

PKO Bank Polski S.A. has introduced guidelines for the financing of and providing banking services to persons and entities having business dealings with Russia and Belarus, including those customers on whom sanctions have been or can be imposed. The main principles applied by the Bank are unavailability, limitation or withdrawal of financing and financial services.

The Bank monitors international sanctions on an ongoing basis and takes appropriate action in this regard.

PKO Bank Polski S.A. takes appropriate actions when it finds its customer on the list of persons and entities covered by special restrictions issued by the Minister of Internal Affairs and Administration, known as the Polish sanctions list. In the event of any changes in the restrictions, the Bank implements the competent authority’s decisions on an ongoing basis, in accordance with the provisions of the Act of 13 April 2022 on special solutions aimed at preventing support for the aggression on Ukraine and maintaining national security. The Bank implements on an ongoing basis the decisions of the competent authority to release funds of entities subject to restrictive measures.

[2-29] The Bank studies the approach of its stakeholders to its charitable and sponsorship activities on a continuous basis. The Bank is among the most recognisable sponsors on the market, and in the banking industry is the most recognisable company supporting various activities and events. Sponsorship of cultural events is particularly appreciated. The largest percentage of banking customers recalls with the Bank’s support granted to PKO Charity Run.

[2-28] The Bank is a member of many organizations, both industrial and regional (e.g. the Polish Bank Association (Związek Banków Polskich), CFA Institute) and many business organizations, such as chambers of commerce and business associations (e.g. the Polish Association of Listed Companies (Stowarzyszenie Emitentów Giełdowych), the Association of Entrepreneurs and Employers (Związek Przedsiębiorców i Pracodawców)). As at the end of 2022, the Bank participated in 76 organizations, and during the year, it joined the Polish Association of Capital Investors and Association of Family Companies.