THE GETIN HOLDING CAPITAL GROUP

Transcription

1 THE GETIN HOLDING CAPITAL GROUP CONSOLIDATED FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS FOR THE YEAR ENDED WITH THE OPINION OF INDEPENDENT AUDITOR

2 TABLE OF CONTENTS CONSOLIDATED INCOME STATEMENT... 4 CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME... 4 STATEMENT OF CHANGES IN THE CONSOLIDATED SHAREHOLDERS EQUITY... 6 STATEMENT OF CHANGES IN THE CONSOLIDATED SHAREHOLDERS EQUITY... 7 CONSOLIDATED CASH FLOW STATEMENT... 8 ADDITIONAL NOTES TO CONSOLIDATED FINANCIAL STATEMENTS General information Composition of the Capital Group together with associates Approval of the financial statements Discontinued activities spin-off of the Capital Group and sale of TU Europa Significant accounting policies Effect of the changes in accounting policies Financial risk management in the Capital Group Information on operating segments Interest income and interest expense Fee and commission income and fee and commission expense Insurance premiums Dividends received Result on financial instruments carried at fair value Result on financial instruments Hedge accounting Foreign exchange result Compensations and benefits Other income and operating expense Administrative expenses Payroll and employee benefits Impairment write-offs and provisions for off-balance sheet items Share in net profit (loss) of associates accounted for using the equity method Income tax Earnings per share Dividends paid and proposed Cash and balances with the Central Bank Amounts from the banks Financial assets held for trading Derivatives Financial assets carried at fair value through profit or loss Bank loans and credits due from customers Finance lease receivables Other loans and receivables Financial instruments Investments in associates Equity instruments available for sale Intangible assets Property, plant and equipment Investment property Reinsurer s share in the technical and insurance provisions Other assets Hyperinflation Assets providing security for liabilities Amounts due to Central Bank Amounts due to other banks and financial institutions Financial liabilities carried at fair value through profit or loss Amounts due to customers Liabilities from the issue of debt securities Other liabilities Technical and insurance provisions Other provisions Employment benefits Contingent liabilities Share capital Other reserves Additional information to cash flow statements Transactions with related parties Business combinations Other comprehensive income Result on loss of control in subsidiaries Post-balance sheet events /142

3 GETIN HOLDING S.A. To the Shareholders of Getin Holding S.A. In accordance with the provisions of the Decree of the Council of Ministers dated 19 October 2005 concerning current and periodic information submitted by issuers of securities (Journal of Laws, No ), the Management Board is pleased to present this consolidated annual report of the Getin Holding Capital Group (the Capital Group, Group ). The consolidated financial statements for the twelve-month period ended included in this consolidated annual Report have been prepared on the assumption that the Group will continue as a going concern without any significant limitation in the scope of its activities. This statement present truly and fairly the financial standing as at the balance day as well as the profitability of the Capital Group for this period. In preparing the consolidated financial statements, appropriate accounting policies were adopted, which were applied consistently throughout the period. The consolidated balance sheet, consolidated income statement, condensed consolidated statement of comprehensive income, statement of changes in consolidated shareholder s equity, consolidated cash flow statement and additional notes to the consolidated financial statements have been prepared in accordance with International Financial Reporting Standards and International Accounting Standards as adopted by the EU. They are presented in this document in the following order: Page Consolidated income statement 4 Condensed consolidated statement of comprehensive income 4 Consolidated balance sheet 5 Statement of changes in consolidated shareholders equity 6 Consolidated cash flow statement 8 Additional notes to consolidated financial statements 9 The Directors Report on the activities of the Capital Group has been appended to these financial statements. Wroclaw, 29 February /142

4 CONSOLIDATED INCOME STATEMENT comparable data Continuing Discontinued Total Continuing Discontinued Note operations operations operations operations Interest income Interest expense 9 ( ) ( ) ( ) (41 463) ( ) ( ) Net interest income Fee and commission income Fee and commission expense 10 (31 273) ( ) ( ) (15 684) ( ) ( ) Net fee and commission income Insurance premiums Dividend received Result on financial instruments measured to fair value (12 443) (11 908) Other financial instruments (2 447) (2 447) Result on the loss of control in an associate Foreign exchange result 16 (43 561) Loss on hyperinflation (IAS 29) 42 (23 879) - (23 879) Claims and benefits paid 17 - ( ) ( ) - (27 910) (27 910) Change of the value of insurance provisions Other operating income Other operating expenses 18 (9 684) ( ) ( ) (9 469) ( ) ( ) Net other operating income (22 513) Net operating income Impairment losses on loans and NIL 21 (40 291) ( ) ( ) ( ) ( ) Administrative expenses 19 ( ) ( ) ( ) ( ) ( ) ( ) Operating profit Profit / (loss) concerned with transactions on affiliates Share in net profit (loss) of associates (4 542) - (4 542) - - Profit / (loss) before income tax Corporate income tax 23 (8 573) ( ) ( ) (12 674) (9 169) Net profit /(loss) for the period Attributable to equity holders of the parent Attributable to non-controlling interest Earnings per share: basic for the period (in PLN) diluted for the period (in PLN) Total CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME comparable data Continuing Discontinued Total Continuing Discontinued Note operations operations operations operations Profit / (Loss) for the period Total Exchange differences from evaluation of foreign subsidiaries Valuation of available for sale investments (549) (549) The effect of cash flow hedge accounting (46 745) (46 745) Participation in an associate result on sale of Issuer shares Income tax relating to other comprehensive income (0) (17 710) (17 710) Other comprehensive income (34 140) (32 360) Total of comprehensive income for the period Attributable to equity holders of the parent Attributable to non-controlling interest Additional notes to the consolidated financial statements presented on pages 9 to 142 are their integral part 4/142

5 CONSOLIDATED BALANCE SHEET Note Comparable data ASSETS Cash and balances with the Central Bank Bills of exchange eligible for rediscounting with the Central Bank Amounts due from banks and financial institutions Financial assets held for trading Derivative financial instruments Financial instruments at fair value through profit or loss Loans and advances to customers Finance lease receivables Other loans and receivables Financial instruments Available for sale Held to maturity Share of reinsurer in insurance provisions Intangible assets Property, plant and equipment Investment properties Non current assets classified as held for sale Assets realated to discontinued operations Tax assets Current tax assets Deferred tax assets Other assets TOTAL ASSETS LIABILITIES AND EQUITY Liabilities Amounts due to Central Bank Amounts due to other banks and finance institutions Derivative financial instruments Other financial liabilities at fair value through profit or loss Deposits from customers Issued debt securities Corporate income tax payable Other liabilities Technical and insurance provisions Deferred tax liabilities Other provisions Liabilities realated to discontinued operations TOTAL LIABILITIES Equity (attributable to equity holders of the parent company) Share capital Net profit /(loss) Other reserves Non-controlling interest Total equity TOTAL EQUITY AND LIABILITIES Additional notes to the consolidated financial statements presented on pages 9 to 142 are their integral part 5/142

6 STATEMENT OF CHANGES IN THE CONSOLIDATED SHAREHOLDERS EQUITY For the 12-month period ended Share capital Reserve capital and retained earnings Revaluation reserve Own shares Other capital Exchange differences Convertible bonds - equity component Other reserve capital Note Net (loss) profit Attributable to equity holders of the parent company Non-controlling interest Total equity At (50 048) (10 621) (56 800) Total comprehensive income for the period Equity issued Costs of equity isssue (1 401) (1 401) (1 401) Transfer of profit for previous year to retained earnings ( ) - - Managerial options Dividends payable to non-controlling shareholders - (39 562) (39 562) Settlement of the acquisition of PDK (8 531) (8 531) (8 531) MW Trade S.A. capital increase (285) (285) Acquisition of Kuban Bank S.A. shares Sale of Open Finance S.A. shares - (6 813) (6 813) Hyperinflation (17 680) (17 680) (17 680) Put options to the non-controlling shareholders (22 515) (22 515) (1 684) (24 199) Other (342) (342) (172) (514) At (10 621) (32 975) Additional notes to the consolidated financial statements presented on pages 9 to 142 are their integral part 6/142

7 STATEMENT OF CHANGES IN THE CONSOLIDATED SHAREHOLDERS EQUITY For the 12-month period ended Share capital Reserve capital and retained earnings Revaluation reserve Own shares Other capital Exchange differences Convertible bonds - equity component Other reserve capital Net (loss) profit Attributable to equity holders of the parent company Non-controlling interest Total equity Note At (14 138) (10 621) (63 374) Total comprehensive income for the period - - (35 910) Equity issued Costs of equity isssue (29) (29) (29) Transfer of profit for previous year to retained earnings ( ) Merger of Getin Noble Bank (15 645) (21 320) (2 111) Managerial options Sombelbank capital increase (12 899) (12 899) Sale of own shares by Getin Noble Bank S.A S.C. Perfect Finance capital increase Decrease of TU Europa non-controlling interest as a result of banks' merger (6 062) Result on sale of TU Europa shares and SPO TU Europa Acquisition of Panorama Finansów S.A. shares from Open Finance (23) Acquisition of Idea Bank S.A. shares Acquisition and capital increase of MW Trade (268) (268) Sale of Fiolet PDK shares (650) (650) 283 (367) Put options to the non-controlling shareholders (18 722) (18 722) (7 679) (26 401) Dividends payable to non-controlling shareholders (3 920) (3 920) Other (1 512) (0) (42) (42) At (50 048) (10 621) (56 800) Additional notes to the consolidated financial statements presented on pages 9 to 142 are their integral part 7/142

8 CONSOLIDATED CASH FLOW STATEMENT Cash flows from operating activities Note comparable data Net profit (loss) Total adjustments: ( ) Depreciation Share in net profits (losses) of associates (10 674) Foreign exchange (profits)/losses (847) 472 (Profit) loss on investing activities ( ) Interest and dividend Change in receivables from banks and bills of exchange eligible for 56 ( ) ( ) rediscounting with the Central Bank Change in financial assets held for trading and other financial instruments at ( ) fair value through profit or loss Change in derivative financial instruments (assets) 56 (41 696) Change in loans and advances to customers 56 ( ) ( ) Change in finance lease receivables 56 ( ) ( ) Change in other loans and receivables 56 (14 165) - Change in securities held for sale 56 ( ) Change in deferred tax assets 56 (66 211) ( ) Change in share of reinsurer in technical provisions 56 (3 958) Change in other assets 56 ( ) ( ) Change in amounts due to banks and financial institutions Change in derivative financial instruments (liability) and other financial 56 ( ) liabilities at fair value through profit or loss Change in amounts due to customers Change in liabilities from the issue of debt securities (28 274) Change in provisions and deferred tax provision (9 035) Change in technical provisions 56 (60 265) Change in other liabilities Other adjustments 56 ( ) (11 997) Income tax paid ( ) ( ) Current tax expense (income statement) Net cash from operating activities Cash flows from investing activities Inflows Sale of shares in subsidiaries, net of cash disposed Sale of investment securities Proceeds from sale of intangible assets and tangible fixed assets Interests received Dividends received Other investing inflows Outflows ( ) ( ) Purchase of subsidiaries, net of cash acquired 56 ( ) ( ) Purchase of associates (224) - Purchase of investment securities (18 442) (35 349) Purchase of intangible assets and tangible fixed assets ( ) (74 492) Interest paid (403) - Other investing outflows (63) - Net cash used in investing activities (2 599) (7 489) Cash flows from financing activities, Issue of shares Issue of debt securities Redemption of debt securities issued ( ) ( ) Dividends paid to non-controlling interest (38 364) (3 922) Interests paid (21 189) (35 307) Interests received Repayment of credits and loans - ( ) Other net financing inflows / expenditure 56 (2 233) Net cash from (used in) financing activities ( ) - - Net change in cash and cash equivalents Net foreign exchange differences (11 899) Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period of which is restricted use - - Additional notes to the consolidated financial statements presented on pages 9 to 142 are their integral part 8/142

9 ADDITIONAL NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1 General information The Getin Holding Capital Group ( Capital Group or Group ) consists of the parent company Getin Holding S.A. ("Getin Holding" or Company or "parent entity"), and its subsidiaries. The consolidated financial statements of the Group cover the 12-month period ended and contain the comparative data for the 12-month period ended for the income statement, the statement of changes in consolidated Shareholders equity, condensed consolidated statement of comprehensive income, the cash flow statement as well as the balance sheet data as at The registered office of Getin Holding S.A. is located in Wrocław, at Powstańców Śląskich 2-4. The Company was originally registered under the name Centaur S.A. on the Furthermore, on the the business name of the Company was changed to Getin Service Provider S.A. On the Getin Service Provider S.A. was incorporated to the National Court Register kept by the District Court for Wrocław-Fabryczna, 6 th Commercial Division of the National Court Register under the number KRS Since the Company has been acting under the business name Getin Holding S.A. The Company obtained the statistical number REGON The Company has set up the Branch Office in Warsaw located at Domaniewska 39. Getin Holding is a financial holding company which carries out the investment activities in the financial sector in Poland and beyond its borders. The Company and the remaining Group entities have an unlimited period of operation. Getin Holding is financial holding and is mainly engaged in capital investment on the domestic and foreign markets. The Company operates as the holding company of the Capital Group and the companies of the Capital Group run their activity within the scope of: - banking services; - insurance services. - leasing services; - financial agency; - investment funds; - brokerage. The type of the activities of individual companies of the Capital Group is described in note 2 of the additional notes to the consolidated financial statements. The entire Getin Holding Group is controlled by PhD Leszek Czarnecki. 9/142

10 2 Composition of the Capital Group together with associates As at the Getin Holding Group together with associates consists of the following companies: Subsidiaries consolidated full method: Company name Type of activity Effective share in capital Getin Noble Bank S.A. w ith its registered office in in Warsaw Banking 93.71% 93.71% Noble Funds TFI S.A. w ith its registered office in Warsaw Financial and investment consulting 65.60% 65.60% Getin Noble Bank S.A. ow ns 70% shares Noble Securities S.A. w ith its registered office in Kracow Brokerage 91.59% 74.74% Getin Noble Bank S.A. ow ns 97.74% shares Getin Leasing S.A. w ith its registered office in Wroclaw Leasing 91.30% 91.30% 93.18% shares are held by Getin Noble Bank S.A., and 3.98% by Getin Holding S.A. Getin Services S.A. w ith its registered office in Wroclaw Additional services connected w ith insurance 91.30% 91.30% Getin Leasing S.A. ow ns 100% shares Pośrednik Finansow y sp. z o.o. w ith its registered office in Wroclaw Mediation in the lease agreements 91.30% 91.30% Getin Leasing S.A. ow ns 100% shares Noble Concierge sp. z o.o.w ith its registered office in Warsaw Prestige concierge services for parent company clients 93.71% 93.71% Getin Noble Bank S.A. ow ns 100% shares Introfactor S.A. w ith its registered office in Warsaw Factoring services 93.71% 93.71% Getin Noble Bank S.A. ow ns 100% shares Getin Finance PLC w ith its registered office London (Great Britain) Financial services 93.71% 93.71% % shares are held by Getin Bank S.A., and 0.002% by Getin Holding S.A. Get Bank S.A. w ith its registered office in Warsaw Banking % na Until company operated under the name of Allianz Bank Polska S.A. Idea Bank S.A. w ith its registered office in Warsaw Banking 97.67% 93.71% 37.05% shares are held by Getin Noble Bank S.A., and 62.95% by Getin Holding S.A. Provista S.A. w ith its registered office in Warsaw Financial agency na 93.71% As at Provista S.A. w as merged w ith PDK S.A.; formerly Idea Bank S.A. (Poland) ow ned 100% shares Pow szechny Dom Kredytow y S.A. w ith its registered office in Wroclaw Financial and insurance agency 97.67% 99.69% Idea Bank S.A. (Poland) ow ns 100% shares Pow szechny Dom Kredytow y Biznes Sp. z o.o. w ith its registered office in Financial agency 97.67% 99.69% Wroclaw PDK S.A. ow ns 100% shares Panorama Finansów S.A. w ith its registered office in Wroclaw Leasing % % TU Europa S.A. w ith its registered office in Wroclaw Insurance services 66.54% 66.54% Additional information TU Na Życie Europa S.A. w ith its registered office in Wroclaw Insurance services 66.54% 66.54% TU Europa S.A. ow ned 100% shares TU Europa UA w ith its registered office in Lviv (Ukraine) Insurance services 69.80% na TU Europa S.A. ow ns 50% shares, TU Europa Na Życie S.A. ow ns 40% shares, Idea Bank (Ukraine) ow ns 10% shares TU Europa UA Życie w ith its registered office in Lviv (Ukraine) Insurance services 69.15% na TU Europa S.A. posiada 42% akcji, TU Europa Na Życie S.A. - 50% akcji, Idea Bank (Ukraina) - 8% akcji spółki MW Trade S.A. w ith its registered office in Wroclaw Financial services 51.27% 51.97% Carcade sp. z o.o. w ith its registered office Kaliningrad (Russian Federation) Lease % % AB Kubanbank S.A. w ith its registered office in Krasnodar (Russian Federation) Banking 96.03% na Carcade sp. z o.o. ow ns 96.03% akcji D2 Technologie Sp. z o.o. w ith its registered office in Krasnodar (Russian Federation) Terminal services for electronic banking % na Carcade sp. z o.o. ow ns % akcji RB Finance System sp. z o.o. w ith its registered office in Wroclaw Financial services % na Carcade sp. z o.o. ow ns 100% akcji Idea Bank w ith its registered office in Lviv (Ukraine) Banking 99.10% 99.06% Until the company had its registered office in Iw ano -Frankow sk (Ukraine), until company operated under the name of Plus Bank S.A.; 99.06% shares are held by Getin Holding S.A., and 0.044% by Gw arant Plus sp. z o.o. Idea Leasing sp. z o.o. w ith its registered office in Lviv (Ukraine) Lease 99.10% na Idea Bank S.A. (Ukraine) ow ns 100% shares Spółka Finansow a Gw arant Plus sp. z o.o. w ith its registered office Kiew Getin International S.A. ow ns 92.58% shares, Idea Bank S.A. (Ukraine) ow ns 0.003% Factoring, guaranting activity and financial agency % % (Ukraine) shares, Carcade Sp. z o.o. ow ns 7.417% shares Sombelbank S.A. w ith its registered office Minsk (Belarus) Banking 99.99% 99.99% % shares are held by Getin International S.a.r.l and 0.006% by Getin International S.A. Getin International S.A w ith its registered office in Wroclaw Holding activity for foreign subordinates % % Getin International S.a.r.l. w ith its registered office in Luxembourg (Grand Duchy of Luxembourg) Holding activity for foreign subordinates % % Getin International S.A. ow ns 100% shares Getin Inw estycje sp. z o.o. w ith its registered office in Wroclaw Holding activity % na % shares are held by Getin Holding S.A., and 0.001% by Getin International S.A. 10/142

11 Associates shown by equity method: Effective share in capital Company name Type of activity Additional information Open Finance S.A. w ith its registered office in Warsaw Financial agency 45,78% 93,71% Getin Noble Bank S.A. ow ns 48.85% shares At the date of and the total number of votes held by the Group subsidiaries equals to the Group s share in equity of these units. The only exception is share of Getin Noble Bank S.A. in Noble Securities S.A. (the Bank holds shares of Noble Securities SA representing 97.74% of share capital and 98.10% of the total number of votes) and share og Getin Noble Bank S.A. in Idea Bank S.A. (Poland) (Getin Noble Bank owns 37.05% shares of share capital in Idea Bank S.A. and 39.44% of the total number of votes, Getin Holding owns 62.95% shares of share capital in Idea Bank S.A. and 60.56% of the total number of votes). 11/142

12 Organisation chart of the Getin Holding Group together with associates as at (before the division of the Company what has occurred on ): Getin Holding S.A. Continuing operations % 100% 99.06% Getin Inwestycje % Getin International (Poland) Idea Bank (Ukraine) 100% 0.006% 92.58% 0.04% 0.003% Getin International (Luxemburg) Gwarant Plus 99.98% Sombelbank 100% Idea Leasing 7.417% % D2 Technologie 100% Carcade 96.03% AB Kubanbank 62.95% 100% Idea Bank (Poland) RB Finance System 51.27% 37.05% MW Trade 100% Powszechny Dom Kredytowy 100% Panorama Finansów 10% 8% PDK Biznes 100% 42% TU Europa UA Życie (Ukraine) 66.54% 100% TU Europa Get Bank 100% 50% TU Europa UA (Ukraine) 50% 40% TU na Życie Europa 3.98% Getin Leasing 93.71% Getin Noble Bank 93.18% 100% Getin Services 100% % Pośrednik Finansowy 0.002% Getin Finance 70% 97.74% 100% Noble Funds TFI Noble Securities 100% Noble Concierge Discontinued operations 48.85% Introfactor Open Finance 12/142

13 Organisation chart of the Getin Holding Group together with associates at the date of publication of this report (after spin-off): Getin Holding S.A % 100% Getin Inwestycje % Getin International (Polska) 100% 0.006% 92.58% Getin International (Luxemburg) 99.98% Sombelbank 99.06% Idea Bank (Ukraina) 100% 0.04% 0.003% Gwarant Plus Idea Leasing 7.417% % D2 Technologie 100% Carcade 96.03% AB Kubanbank 62.95% Idea Bank (Polska) 100% RB Finance System 100% 51.27% MW Trade Powszechny Dom Kredytowy 100% Panorama Finansów 10% 8% PDK Biznes 100% 42% TU Europa UA Życie (Ukraina) 66.54% TU Europa 50% TU Europa UA (Ukraina) 50% 100% 40% TU na Życie Europa 51% Open Life TU na Życie During the period from until there have been following changes in the composition of the Capital Group together with associates: In 1 st quarter of 2011 Getin Noble Bank sold 23.5 million of shares of its subsidiary Open Finance as a result of two transactions in February 2011 (3 million of shares) and in March 2011 in public offering of Open Finance (20.5 million of shares). At the same time Open Finance raised the share capital in a public offering of 4.25 million of new shares, in which acquisition Getin Noble Bank did not participate. Management Board of Getin Noble Bank, on the basis of analysis of all the terms and conditions of contracts and their economic impact, has made the professional assessment of sale of shares in Open Finance and considered the following transactions as related and accounted as single transaction, also taking into account the fact, that the Supervisory Board considered the following transactions as package in single resolution: on the Bank signed the agreement with Mr. Leszek Czarnecki and Home Broker S.A. for the sale of 6% of Open Finance shares in March 2011 the sale of 41% of Open Finance shares owned by the Bank took place within IPO in April 2011 the share capital of Open Finance raised by 4.25 million of shares through a public issue of new shares. 13/142

14 The Getin Holding Capital Group On Getin Noble Bank Bank purchased from JA Investment Holding B.V. and Valoro Netherlands B.V. 698,250 Noble Securities shares with the nominal value of 1 PLN each, accounting for 19.98% of the share capital of this company and thus increased the shares in Noble Securities share capital to 99.74% and the votes number at the General Shareholders Meeting of Noble Securities to 99.78% vote. On Carcade purchased 60,466,458 shares of AB Kubanbank S.A. in Krasnodar with the nominal value of RUB 1.00 (PLN 0.1) each, accounting for 75.58% of the bank's share capital for the total price of RUB 36,280 thousand (PLN 3,690 thousand), i.e. for RUB 0.60 (PLN 0.06) for each share. At the same time, Carcade purchased % of shares in D2 Technologie Sp. z o.o. for the total price of RUB 20,867 thousand plus USD 6,897 thousand (PLN 22,151 thousand). The Company D2 Technologie Sp. z o.o. is providing services exclusively to the Open Joint Stock Company Kubanbank. Both companies were acquired from private persons, being previous shareholders of the aforementioned companies. D2 Technologie Sp. z o.o. provides its services to AB Kubanbank S.A. only. The aforementioned transaction was registered on and the acquisition became effective. Moreover, in reporting period Carcade bought from Kubanbank shareholders 3,796,470 Carcade shares (3,175,411 ordinary shares and 621,059 preferred shares) with the nominal value of RUB 1 each and the total value of RUB 2,278 thousand (PLN 242 thousand). After these acquisitions Carcade held % share in the share capital of Kubanbank. On Getin Holding purchased 103,060 (100%) shares of Allianz Bank Polska S.A. seated in Warsaw (currently Get Bank S.A.) for a total price PLN 149,219 thousand. On the basis of the agreement concluded with Mr. Czcibor Dawid, on , sold off to him 69,894 shares (2%) of Noble Securities. Consequently, Getin Noble Bank s share in the Noble Securities share capital at the end of 2011 stood at 97.74%. On Idea Leasing Sp. z o. o., a new company based in Lviv was set up. All shares in the company share capital worth UAH 100 thousand (PLN 33 thousand) were taken up by Idea Bank Ukraine. On Open Finance purchased from Towarzystwo Ubezpieczeniowe Link4 and Intouch Insurance BV 24,745,000 shares of MY LIFE Towarzystwo Ubezpieczeń Na Życie S.A. (currently Open Life) accounting for 49% share in the company for the total price of PLN 9,595, Getin Noble Bank purchased 9,595,000 shares of MY LIFE Towarzystwo Ubezpieczeń na Życie SA (currently Open Life) accounting for 19% share in the company at the total price PLN 3,721 thousand. On Getin Holding under the contract of sale dated sold off to Idea Bank 246,530 shares of Powszechny Dom Kredytowy with the nominal value PLN 100 each, accounting for 44.5% of PDK share capital. As a result of this transaction share of Idea Bank In the share capital of PDK increased to 49.5%. On the District Court for the capital city of Warsaw, the 13th Commercial Division of the National Court Register registered the increase in the share capital of Idea Bank by PLN 16,771,936 by the issue of 8,385,968 G-series ordinary registered shares with the face value of PLN 2 each, and on the said court registered another increase in the share capital of Idea Bank by PLN 16,771,934 by issuing 8,385,967 H-series ordinary registered shares with the face value of PLN 2 each. The shares of G- and H-series G were acquired by Getin Holding On Getin Holding purchased 50 shares of RB Investment System Sp. z o.o. with its registered office in Wrocław with the face value of 100 PLN each, for PLN 5,100, which constitute 100% stake in the company's share capital. On the District Court for Wrocław Fabryczna, the 6th Commercial Division of the National Court Register registered the change of the company s name to Getin Inwestycje Sp. z o. o. On Gwarant Plus purchased 64,126 shares of Idea Bank, Ukraine (former Plus Bank) for UAH 500 thousand (PLN 178 thousand). In consequence Getin Holding holds indirectly as at % stake in the Bank. On the increase in the share capital of Carcade by RUB 486,000 thousand (48,211 thousand PLN) was registered. All shares in the increased capital were taken up by Getin Holding. 14/142

15 The Getin Holding Capital Group On Getin International purchased from Getin International S.a.r.l. 1 share of ZAO Sombelbank for EUR 448, i.e. PLN 2 thousand, the share face value was BYR 3,306 thousand, i.e. PLN 2 thousand. On TU Europa concluded with Getin Noble Bank and Mr. Leszek Czarnecki a conditional agreement to purchase 25,755 thousand shares in Open Life. The shares accounnted for 51% in Open Life share capital and conferred 51% votes at general meetings of shareholders (TU Europa has signed an agreement to purchase 19% of shares with Getin Noble Bank and the purchase of 32% of shares wih Mr. Leszek Czarnecki). The purchase transaction was executed on upon obtaining the required clearance of the Polish Financial Supervision Authority granted on On Getin Holding contributed 279,770 shares of PDK, i.e. 50.5% of the company s share capital, to Getin Inwestycje Sp. z o. o., which increased the company's share capital from PLN 5 thousand to PLN 111,105 thousand. On the District Court for Wrocław Fabryczna, the 6th Commercial Division of the National Court Register registered the increase in the share capital of Getin Inwestycje Sp. z o.o. On Idea Bank, Polska concluded with Getin Inwestycje Sp. z o. o. a conditional agreement to purchase 279,770 registered shares of PDK with the face value of PLN 100 each that constitute 50.5% of the company's share capital, for the price of PLN 111,100,000. On the transaction was finalized and Idea Bank became the owner of 100% shares of PDK. On Open Finance acquired 100% of Home Broker shares, seated in Warsaw from LC Corp B.V. seated in Amsterdam, H.P. Holding 3 B.V. seated in Rotterdam, Aegaeon B.V. seated in Rotterdam, Damian Milibrand and A. Nagelkerken Holding B.V. seated in Rotterdam, On the following companies based in Ukraine were registered: Private Joint-stock Company Europa Life Insurance Ukraine with the share capital of UAH 16,320 thousand (PLN 6,905 thousand), divided into 16,320 thousand shares with the face value of UAH 1 each. The shares were taken up by: a. TU na Życie Europa: 50% stake in the share capital, i.e. 8,160 thousand shares; b. TU Europa: 42% stake in the share capital, i.e. 6,854.4 thousand shares, c. Idea Bank Ukraine: 8% stake in the share capital, i.e. 1,305.6 thousand shares; Private Joint-stock Company Europa Insurance Ukraine with the share capital of UAH 10,880 thousand (PLN 4,603 thousand), divided into 10,880 thousand shares with the face value of UAH 1 each. The shares were taken up by: a. TU na Życie Europa S.A.: 40% stake in the share capital, i.e. 4,352 thousand shares; b. TU Europa SA: 50% stake in the share capital, i.e. 5,440 thousand shares; c. Idea Bank Ukraine: 10% stake in the share capital, i.e. 1,088 thousand shares. On the merger of Provista and PDK was registered in accordance with provisions of Art. 492 (1) (1) of the Code of Commercial Companies and Partnerships, through transfer of all assets of PDK (target company) to Provista (bidding company). Provista, the bidding company changed its name to Powszechny Dom Kredytowy Spółka Akcyjna. On an increase in the share capital of Kubanbank by RUB 316,964 thousand (PLN 33,630 thousand) effected by issuing 316,963,863 new shares was registered. All new shares were taken up by Carcade and thus Carcade interest in Kubanbank increased to 96.03%. 15/142

16 2.1. Employment in the Capital Group Employment (full-time posts) at companies of the Getin Holding Capital Group (unaudited) (unaudited) Change Getin Holding S.A Getin Noble Bank Group (130) Idea Bank Group (Poland) TU Europa Group (7) PDK S.A MW Trade S.A Panorama Finansów S.A Get Bank S.A. 138 Na 138 Carcade Sp. z o.o 1) Getin International S.A. 2) Sombelbank S.A Idea Bank S.A. (Ukraine) SC Perfect Finance S.r.l. Na 12 (12) Spółka Finansowa Gwarant Plus sp. z o.o. 1 4 (3) Total including: Poland International activities ) Carcade Sp. z o.o., AB KubanBank S.A., D2 Technologie Sp. z o.o. 2) Getin International S.A., Getin International S.a.r.l Management Board of the parent company As at the Management Board of Getin Holding S.A. was composed of: Radosław Boniecki President of the Management Board Łukasz Chojnacki I Vicepresidnet of the Management Board Katarzyna Beuch Member of the Management Board, CFO In the period covered by the financial statements, on Mr. Radosław Boniecki resigned from the post of the President of the Management Board of the Company, effective as of Next the Supervisory Board of the Company appointed Mr. Rafał Juszczak as President of the Management Board of the Company, effective as of Due to Mr. Radosław Boniecki s resignation from the post of President, the Company's Supervisory Board at the meeting dated appointed Mr. Radosław Boniecki as the Management Board Vice-president, effective as of At the same meeting the company's Supervisory Board made a decision to remove Mr. Łukasz Chojnacki from the post of the Company s Management Board I Vice-president, effective as of , and as of entrust Mr. Łukasz Chojnacki with the post of the Company s Management Board Vice-president. On Mr. Łukasz Chojnacki resigned from the function of Vicepresident in the Management Board of the Company with the effect from On the Supervisory Board of the Company appointed Mr. Robert Działak as the Management Board of the Company Member for the period from to Therefore, the composition of the Management Board at the date of these consolidated financial statements is as follows: Rafał Juszczak President of the Management Board Radosław Boniecki Vice-president of the Management Board Katarzyna Beuch Member of the Management Board, CFO Robert Działak Member of the Management Board 16/142

17 3 Approval of the financial statements These consolidated financial statements were approved for publication by the Management Board on Discontinued activities spin-off of the Capital Group and sale of TU Europa Capital Group division process In 2011 Getin Holding was implementing its changes strategy in the Capital Group, that is the process of spin-off of the company s organized enterprise, i.e. Getin Holding Branch in Warsaw to its subsidiary Get Bank S.A. (transfer of part of assets to an existing company). The Branch was responsible for domestic banking operations and related business, and its assets included a block of 93.71% shares in Getin Noble Bank held by Getin Holding. The main goals of the spin-off process are as follows: continuation of its present operations by Getin Holding and transferring only part of its assets and liabilities to its subsidiary unit Get Bank; making Getin Holding Group's structure transparent and separating well-established mature units from start-ups; allotting the new issue shares in Get Bank issued in a public offering to the existing shareholders of Getin Holding proportionally to the shares they hold in Getin Holding, applying the share swap parity ( shares in Get Bank for each share in Getin Holding) tied to valuation of Get Bank and the spun-off Getin Holding Branch in Warsaw; carrying out the division of Getin Holding and the process of introduction of Get Bank shares to trading in the regulated market maintained by Warsaw Stock Exchange S.A. (the "WSE"); finally trading Getin Noble Bank shares in a regulated market and in consequence satisfying the obligation made to the Polish Financial Supervision Authority (the "PFSA") ensuring that Getin Noble Bank shares 3.5 years after (Nobel Bank and Getin Bank merger date) will reach the required float rate in the WSE, which means that at least 15% shares will be held by other units than Mr. Leszek Czarnecki or his subsidiaries. This conditions will be satisfied at the final stage of the strategy implementation, i.e. upon Getin Noble Bank merger with Get Bank. Material events that occurred in implementation of the aforementioned strategy (reported in detail in Note 1.3): the Management Boards of Getin Holding and Get Bank agreed and signed Getin Holding Spin-off Plan; the EGMs of Getin Holding and Get Bank approved the spin-off of Getin Holding; the PFSA approved the prospectus for admission of the existing shares in Get Bank to trading; the PFSA issued clearances for changes of shareholders of the Capital Group regulated companies in connection with the spin-off process; the PFSA approved Get Bank's prospectus drawn up in connection with a public offering of new shares allotted to Getin Holding shareholders within the spin-off process; the relevant district court registered an increase in the share capital of Get Bank by spin-off issue shares, and thereby the spin-off of Getin Holding became effective; spin-off issue shares in Get Bank were introduced to trading at stock exchange. As the result of Getin Holding spin-off on two capital groups emerged: Getin Holding Group comprising Idea Bank and companies conducting other financial operations (MW Trade and Panorama Finansów) as well as insurance companies (TU Europa and its subsidiaries TUnŻ Europa and Open Life) and companies conducting financial operations abroad (Carcade, Kubanbank, Sombelbank, Idea Bank Ukraine, Europa Insurance Ukraine, Europa Insurance Ukraine Life, Getin International S.A. i Getin International S.a.r.l.), and the capital group composed of Get Bank and Getin Noble Bank with their subsidiaries. Due to that fact and pursuant to requirements of IFRS 5 "Assets held for sale and discontinued operations ie. due to classification of spin-off operations the Group disclosed the operations related to the spun-off assets, i.e. Get Bank and Getin Noble Bank as discontinued operations. 17/142

18 Sale of TU Europa Group On the Company concluded a transaction agreement to sell of 50% plus 1 share in Towarzystwo Ubezpieczeń Europa S.A. to Talanx and Meiji Yasuda Life. The contractual price for the block of shares in TU Europa totals PLN 911,925 thousand, i.e. PLN 193 for one share. The agreement to sell and purchase shares is conditional upon satisfaction of conditions precedent, including obtaining relevant clearances. At the balance sheet date and the date of approval of these financial statements the above mentioned clearances have not yet been granted. As at TU Europa Group assets totalled PLN 848,828 thousand, while the company goodwill was worth PLN 326,512 thousand and TU Europa s trademark PLN 41,000 thousand. The block of shares in TU Europa shall be sold under a tender offer to subscription for sale of 100% TU Europa shares that was announced on The tender offer is conditional upon obtaining all clearances from relevant antimonopoly authorities for TU Europa takeover and issuance by the PFSA a decision on expressing no objection to the purchase of the shares, as well as reaching a minimum subscription for sale of 4,725,001 shares, i.e. 50% + 1 of TU Europa share capital. If the conditions set forth in the transaction agreement have been satisfied, Getin Holding shall subscribe for sale of shares in TU Europa under the said tender offer within 5 business days. Furthermore, under the transaction agreement the Company agreed not to dispose of the remaining 16.54% shares in TU Europa for the period of 5 years after the transaction date and to conclude a subsequent lock-up agreement for the subsequent period of 5 years, should the agreement require so, and to pay Talanx a contractual penalty of EUR 50 million in the event when it breaches that obligation and makes it impossible for the purchasers to purchase the remaining shares in TU Europa within put/call options set forth in the transaction agreement. In accordance with the provisions set forth in the transaction agreement Getin Holding may sell the remaining 16.54% shares within the agreed call/put options at a strike price that will be related to the result accomplished in cooperation in the bancassurance sector, discussed herein below. The strike price calculated in accordance with the provisions of the agreement may be lowered by EUR 1,250 thousand for one percentage point below 90% threshold of the expected 10 year cooperation result discussed herein below. Furthermore, on Getin Holding concluded with Talon, Meiji Yasuda, TU Europa, TU na Życie Europa, Open Life and Mr. Leszek Czarnecki a frame bancassurance cooperation agreement for a definite period of time required for the final settlement of the 10 year cooperation result and payment of the remuneration set forth in the Frame Incentive Agreement. Under the Frame Incentive Agreement the total expected technical result of the aforementioned insurance companies earned in cooperation between Getin Holding Capital Group companies and units related to Mr. Leszek Czarnecki (among others Getin Noble Bank, Idea Bank, Open Finance) in the bancassurance sector in the 10 year period of the Frame Incentive Agreement was agreed by the parties at PLN 1,230 million. Therefore in accordance with to requirements of IFRS 5 "Assets held for sale and discontinued operations" the Company disclosed TU Europa Group operations as discontinued operations. 18/142

19 Assets and liabilities related to discontinued operations Assets realated to discontinued operations (thousand PLN) Note Cash and balances with the Central Bank Amounts due from banks and financial institutions Financial assets held for trading Derivative financial instruments Financial instruments at fair value through profit or loss Loans and advances to customers Finance lease receivables Other loans and receivables Financial instruments Available for sale Held to maturity Share of reinsurer in insurance provisions Inwestycje w jednostki stowarzyszone Intangible assets Property, plant and equipment Investment properties Non current assets classified as held for sale Tax assets Current tax assets Deferred tax assets Other assets Assets realated to discontinued operations Liabilities realated to discontinued operations (thousand PLN) (thousand Zobowiązania PLN) Amounts due to other banks and finance institutions Derivative financial instruments Other financial liabilities at fair value through profit or loss Deposits from customers Issued debt securities Corporate income tax payable Other liabilities Technical and insurance provisions Deferred tax liabilities Other provisions Liabilities realated to discontinued operations Significant accounting policies 5.1 Basis for preparing consolidated financial statements The consolidated financial statements have been prepared under the historical cost convention, except for derivative financial instruments and financial instruments that are available for sale, held for trading, valued at fair value through profit and loss, and other assets that are intended for sale at a fair value. The consolidated financial statements are presented in PLN (PLN thousand), and all figures are given in PLN thousands, unless indicated otherwise. The consolidated financial statements have been prepared on the assumption that the companies of the Group will continue their business activity in the foreseeable future i.e. at least for one year from the balance day. As at the date of approval of these consolidated financial statements, there were no circumstances that would indicate a threat to the continuing operations of the Companies of the Group in the period of at least for one year from the balance day, in connection with a spin-off of Getin Holding effective on the companies of the Group will continue its activities in 2012, respectively in Getin Holding Group or Get Bank and Getin Noble Bank Group, as more fully explained in note 4 above. 19/142

20 5.2 Statements of compliance The attached financial statements have been prepared in accordance with the International Financial Reporting Standards adopted by European Union (IFRS-UE). IFRS-UE comprise standards and interpretations accepted by the International Accounting Standards Board ( IASB ) and the International Financial Reporting Interpretations Committee ( IFRIC ). Under IFRS-UE the Group has the opportunity to choose the accounting policy. Accounting policies used by the Group are described in note 5 Significant accounting policies. As described in section 5.20 the Group applied the provisions of IAS 39 concerning hedge accounting under IAS 39, approved by EU. Certain entities of the Group keep their accounting books in accordance with accounting policies specified in the Accounting Act dated ( the Accounting Act ) as amended and with the regulations issued on the basis of this Act ( Polish Accounting Standards ). The foreign entities of the Group keep their accounting books in accordance with relevant domestic regulations. The consolidated financial statements include a number of adjustments not included in the books of account of those Companies of the Group, which were made to reconcile the financial statements of those companies to be in conformity with IFRS-UE. 5.3 Significant values based on professional judgment and estimates Professional assessment Classification of lease agreements The Group's lease classification into operating or capital lease is based on the price, depending on what portion of risk and benefits of holding the leased object is attributable to a lessor and to a lessee, which is each time decided based on the economic content of each transaction. Portfolio factors in measuring exposure Portfolio parameters such as PD (possible default separately for restructured exposure, performing exposure and additionally for exposures infected by impairment), RR (recovery rate), RestrR (restructuring rate) or CR (conversion rate of impaired exposure to restructured exposure) required for the calculation of impairment losses are based on historical data. The parameters are estimated separately for each product group applying statistical methods. Parameter estimation is made based on the historical exposure data. If required manual adjustment of portfolio parameters is possible so as to reflect the impact of current conditions. The Group verifies the portfolio estimation methodology and assumptions on regular basis so as to minimise discrepancies between their factual and estimated amounts. Additionally for the estimation of IBNR provision for each identified portfolio the loss incurred period (LIP), maximum quarantine period for restructured exposures, conditions for conversion from impaired to restructured exposures and others are estimated. In H Getin Noble Bank introduced to the methodology of measuring impairment losses, in accordance with IAS 39 and 37, infection effect of loan impairment of the same borrower within specific product groups and changed rules for exposures with recognized impairment. Furthermore, within portfolios a quarantine period was introduced for exposures converting from the default state for which impairment losses level was increased due to separately calculated default probability. Due to the changes reported hereinabove Getin Noble Bank introduced modifications to algorithms and formulas used for calculation of impairment losses. The changes did not have material impact over the impairment losses made due to the balancing effect of increasing the risk for default exposure and under the quarantine and decreasing the risk of other IBNR exposures, which however caused single jumping increase of nonperforming loans (NPL). Estimated increase of share of nonperforming loans due to mentioned above changes amounted to about 0.6 percentage point. Open Finance S.A. sale settlement Having analysed all terms and conditions of contracts and their economic effects, the Bank Management Board made professional judgment of the sale transaction of shares in Open Finance S.A. finding them related. The Management Board also took into account the fact that the Supervisory Board of Getin Noble Bank took the decision on the transactions in one resolution. The shares sale transactions were treated as one package and recognized as one transaction. 20/142