EBP.WAR

The dividend policy of Erste Bank Polska S.A. lays down the goals and key aspects of dividend payments. The general assumption of the Bank's dividend policy is to ensure stable dividend payments in the long term, taking into account the current and future capital needs of the Bank and Erste Bank Polska Group. In a standard situation, the Bank pays dividend in cash. In accordance with § 50(3) of the Bank’s Statutes, the Bank may also pay dividend in securities. Pursuant to the Bank’s dividend policy, the dividend is paid from the net profit earned in a given financial year. The Bank's net profit is verified by an independent auditor appointed to examine the financial statements of the Bank and Erste Bank Polska Group. The Bank may also pay dividend from retained earnings. In such a case, the Bank will also follow Article 129(3) of the Banking Law Act, which stipulates that consent of the Polish Financial Supervision Authority (KNF) is required to distribute among shareholders an amount higher than the net profit for the last financial year less any loss carried forward, own shares and amounts that may not be paid out as dividend. The purpose of the dividend policy is to ensure optimal capital structure of the Bank and Erste Bank Polska Group taking into account the return on capital and capital costs, and capital requirements related to development, while maintaining appropriate capital adequacy ratios (taking into account the combined buffer requirement). For strategic reasons, the Bank keeps a higher level of own funds than what is required by the applicable minimum capital limits. Additional buffers were applied to the minimum regulatory requirements in line with the Bank’s risk appetite. The buffers ensure that capital ratios are at levels that allow dividend objectives to be achieved. Dividend payment is recommended by the Bank’s Management Board in the form of resolution, in accordance with the prudent management principle, taking into account assessment of capital surplus over acceptable capital ratios, including in stress, and the necessary profit reinvestment rate to deliver strategic plans and maintain appropriate levels of ROA and ROE. The Bank’s dividend policy takes into account regulatory guidance and individual recommendations issued to the Bank by the KNF with respect to the possibility of paying dividend from the current year’s and previous years’ profits.