Alior Bank S A : Consolidated Financial Statements of Alior Bank Group 20211231

Consolidated Financial Statements

of the Alior Bank Spółka Akcyjna Group

for the year ended 31 December 2021

This version of our report is a translation from the original, which was prepared in Polish language. All possible care has been taken to ensure that the translation is an accurate representation of the original. However, in all matters of interpretation of information, views or opinions, the original language version of our report takes precedence over this translation.

C o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s o f t h e A l i o r B a n k S A G r o u p f o r t h e y e a r e n d e d 3 1 D e c e m b e r 2 0 2 1

										( i n P L N ' 0 0 0 )
Selected financial data concerning the financial statements
		PLN			01.01.2021 -			01.01.2020 -		%
				31.12.2021			31.12.2020			(A-B)/B
							A			B		C
		Net interest income			2 798 234			2 848 726		-1.8%
		Net fee and commission income			766 748			635 846		20.6%
		Trading result & other			72 139			60 916		18.4%
		Net expected credit losses, impairment allowances of non-			-1 038 531			-1 866 604		-44.4%
		financial assets and cost of legal risk of FX mortgage loans*
		General administrative expenses*			-1 582 544			-1 664 531		-4.9%
		Gross profit/loss			779 211			-206 450		-477.4%
		Net profit/loss			481 925			-311 233		-254.8%
		Net cash flow			1 303 490			1 080 774		20.6%
		Loans and advances to customers			58 228 178			56 215 422		3.6%
		Amounts due to customers			72 005 715			66 875 907		7.7%
		Equity			5 919 202			6 559 602		-9.8%
		Total assets			83 048 372			78 642 032		5.6%
		Selected ratios
		Profit/loss per ordinary share (PLN)			3.69			-2.38		-254.8%
		Capital adequacy ratio			14.16%			15.85%		-10.7%
		Tier 1			12.55%			13.55%		-7.4%
		EUR			01.01.2021 -			01.01.2020 -		%
				31.12.2021			31.12.2020			(A-B)/B
							A			B		C
		Net interest income			611 302			636 701		-4.0%
		Net fee and commission income			167 504			142 114		17.9%
		Trading result & other			15 759			13 615		15.7%
		Net expected credit losses, impairment allowances of non-			-226 877			-417 193		-45.6%
		financial assets and cost of legal risk of FX mortgage loans*
		General administrative expenses*			-345 722			-372 029		-7.1%
		Gross profit/loss			170 226			-46 142		-468.9%
		Net profit/loss			105 281			-69 562		-251.3%
		Net cash flow			284 760			241 557		17.9%
		Loans and advances to customers			12 659 951			12 181 551		3.9%
		Amounts due to customers			15 655 458			14 491 615		8.0%
		Equity			1 286 951			1 421 427		-9.5%
		Total assets			18 056 349			17 041 265		6.0%
		Selected ratios
		Profit/loss per ordinary share (PLN)			0.81			-0.53		-252.8%
		Capital adequacy ratio			14.16%			15.85%		-10.7%
		Tier 1			12.55%			13.55%		-7.4%
*Restated - Note 4.2
		Selected items of the financial statements were translated into EUR at			31.12.2021					31.12.2020
		the following exchange rates
		NBP's avarage exchange rate as at 31 December of the year						4.5994				4.6148
		NBP's avarage exchange rates as at the last day of each month						4.5775				4.4742
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C o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s o f t h e A l i o r B a n k S A G r o u p
f o r t h e y e a r e n d e d 3 1 D e c e m b e r 2 0 2 1
	( i n P L N ' 0 0 0 )
Table of Contents
Selected financial data concerning the financial statements ........................................................................................................................................................................	2
Consolidated income statement .........................................................................................................................................................................................................................	4
Consolidated statement of comprehensive income........................................................................................................................................................................................	4
Consolidated statement of financial position...................................................................................................................................................................................................	5
Consolidated statement of changes in equity..................................................................................................................................................................................................	6
Consolidated Statement of cash flow ................................................................................................................................................................................................................	7
Notes to the consolidated financial statements ..............................................................................................................................................................................................	8
1	Information about the Bank and the Group.........................................................................................................................................................................	8
2	Basis of preparation of the financial statements .............................................................................................................................................................	13
3	Description of the material accounting principles...........................................................................................................................................................	14
4	Changes in accounting principles........................................................................................................................................................................................	18
5	Operating segments...............................................................................................................................................................................................................	19
Notes to consolidated income statement ......................................................................................................................................................................................................	22
6	Net interest income ...............................................................................................................................................................................................................	22
7	Net fee and commission income .........................................................................................................................................................................................	25
8	The result on financial assets measured at fair value through profit or loss and FX result ....................................................................................	27
9	The result on derecognition of financial instruments not measured at fair value through profit or loss.............................................................	27
10	Result on other operating income and expenses.............................................................................................................................................................	28
11	General administrative expenses ........................................................................................................................................................................................	28
12	Net expected credit losses ...................................................................................................................................................................................................	29
13	The result on impairment of non-financial assets............................................................................................................................................................	30
14	Cost of legal risk of FX mortgage loans .............................................................................................................................................................................	31
15	Banking Tax .............................................................................................................................................................................................................................	32
16	Income tax ...............................................................................................................................................................................................................................	32
17	Profit per share .......................................................................................................................................................................................................................	35
Additional information to the statement of financial position...................................................................................................................................................................	35
18	Cash and cash equivalents....................................................................................................................................................................................................	35
19	Amounts due from banks......................................................................................................................................................................................................	36
20	Investment financial assets ..................................................................................................................................................................................................	37
21	Hedge accounting ..................................................................................................................................................................................................................	43
22	Loans and advances to customers ......................................................................................................................................................................................	50
23	Property, plant and equipment and intangible assets.....................................................................................................................................................	64
24	Other assets ............................................................................................................................................................................................................................	71
25	Assets pledged as colleteral .................................................................................................................................................................................................	72
26	Amounts due to banks ..........................................................................................................................................................................................................	72
27	Amounts due to customers ..................................................................................................................................................................................................	73
28	Financial liabilities...................................................................................................................................................................................................................	74
29	Provisions.................................................................................................................................................................................................................................	75
30	Other liabilities........................................................................................................................................................................................................................	79
31	Subordinated liabilities ..........................................................................................................................................................................................................	80
32	Equity........................................................................................................................................................................................................................................	80
Other additional information ............................................................................................................................................................................................................................	83
33	Off-balance sheet items........................................................................................................................................................................................................	83
34	Additional information to the cash flow statement ........................................................................................................................................................	84
35	Fair value hierarchy................................................................................................................................................................................................................	85
36	Transactions with related entities.......................................................................................................................................................................................	92
37	Benefits for the for senior executives................................................................................................................................................................................	94
38	Offsetting of financial assets and liabilities.......................................................................................................................................................................	97
39	Legal claims..............................................................................................................................................................................................................................	98
Explanatory notes concerning risk.................................................................................................................................................................................................................	100
40	Credit Risk..............................................................................................................................................................................................................................	102
41	Interest rate risk....................................................................................................................................................................................................................	114
42	Foreign exchange risk (FX risk)..........................................................................................................................................................................................	120
43	Liquidity risk ..........................................................................................................................................................................................................................	122
44	Operational Risk ...................................................................................................................................................................................................................	129
45	Capital Management............................................................................................................................................................................................................	132
Other……………….................................................................................................................................................................................................................................................	136
46	Events significant to the business operations of the Bank's Group...........................................................................................................................	136
47	Significant events after the end of the reporting period..............................................................................................................................................	137

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C o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s o f t h e A l i o r B a n k S A G r o u p f o r t h e y e a r e n d e d 3 1 D e c e m b e r 2 0 2 1

( i n P L N ' 0 0 0 )

Consolidated income statement

			Note number			01.01.2021 -
					31.12.2021
	Interest income calculated using the effective interest method					2 837 304
	Income of a similar nature					199 338
	Interest expense					-238 408
	Net interest income		6			2 798 234
	Fee and commission income					1 441 514
	Fee and commission expense					-674 766
	Net fee and commission income		7			766 748
	Dividend income					532
	The result on financial assets measured at fair value through profit or loss		8			87 149
	and FX result
	The result on derecognition of financial instruments not measured at fair		9			5 293
	value through profit or loss
	measured at fair value through other comprehensive income					3 246
	measured at amortized cost					2 047
	Other operating income					147 487
	Other operating expenses					-168 322
	Net other operating income and expenses		10			-20 835
	General administrative expenses		11			-1 582 544
	Net expected credit losses		12			-1 006 663
	The result on impairment of non-financial assets		13			-10 482
	Cost of legal risk of FX mortgage loans		14			-21 386
	Banking tax		15			-236 835
	Gross profit/loss					779 211
	Income tax		16			-297 286
	Net profit/loss					481 925
	Net profit/loss attributable to equity holders of the parent					481 925
	Weighted average number of ordinary shares					130 553 991
	Net profit/loss per share (PLN)		17			3.69
*Restated - Note 4.2
Consolidated statement of comprehensive income
			Note number			01.01.2021 -
					31.12.2021
	Net profit/loss					481 925
	Items that may be reclassified to the income statement after certain					-1 122 412
	conditions are satisfied
	Foreign currency translation differences					1 577
	Results of the measurement of financial assets (net)					-63 611
	Profit/loss on valuation of financial assets measured at fair value through		20			-78 499
	other comprehensive income
	Deferred tax		16			14 888
	Results on the measurement of hedging instruments (net)					-1 060 378
	Gains/losses on hedging instruments		21			-1 309 109
	Deferred tax		16			248 731
	Total comprehensive income, net					-640 487
	- attributable to shareholders of the parent company					-640 487

01.01.2020 - 31.12.2020*

3 159 045

173 828

-484 147

2 848 726

1 215 749 -579 903

635 846

700

79 070

84 553

60 607

23 946

137 039 -240 446

-103 407

-1 664 531 -1 733 471

-132 822 -311-220 803

-206 450

-104 783

-311 233

-311 233

130 553 991

-2.38

01.01.2020 -

31.12.2020

-311 233

138 701

-2 225

25 755

31 793

-6 038

115 171

142 186

-27 015

-172 532

-172 532

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C o n s o l i d a t e d F i n a n c i a l S t a t e m e n t s o f t h e A l i o r B a n k S A G r o u p f o r t h e y e a r e n d e d 3 1 D e c e m b e r 2 0 2 1

( i n P L N ' 0 0 0 )

Consolidated statement of financial position

ASSETS	Note number	31.12.2021	31.12.2020
Cash and cash equivalents	18	3 763 391	2 459 901
Amounts due from banks	19	1 689 779	508 371
Investment financial assets:	20	16 099 658	15 744 672
measured at fair value through other comprehensive income		9 265 445	6 983 904
measured at fair value through profit or loss		382 900	594 926
measured at amortized cost		6 451 313	8 165 842
Derivative hedging instruments	21	38 810	334 977
Loans and advances to customers	22	58 228 178	56 215 422
Assets pledged as collateral	25	130 921	446 455
Property, plant and equipment	23	755 209	702 381
Intangible assets	23	426 643	425 109
Inwestments in associates		0	5 333
Non-current assets held for sale		0	3
Income tax asset	16	1 302 329	1 218 282
current income tax asset		27	59 572
deferred income tax asset		1 302 302	1 158 710
Other assets	24	613 454	581 126
TOTAL ASSETS		83 048 372	78 642 032

LIABILITIES AND EQUITY	Note number	31.12.2021	31.12.2020
Amounts due to banks	26	529 617	912 407
Amounts due to customers	27	72 005 715	66 875 907
Financial liabilities	28	188 088	501 880
Derivative hedging instruments	21	1 081 996	86 162
Provisions	29	290 213	336 560
Other liabilities	30	1 649 540	1 569 867
Income tax liabilities	16	36 560	6 685
current income tax liabilities		35 671	6 046
deferred income tax liabilities		889	639
Subordinated liabilities	31	1 347 441	1 792 962
Total liabilities		77 129 170	72 082 430
Share capital		1 305 540	1 305 540
Supplementary capital		5 403 849	5 399 627
Revaluation reserve		-906 659	217 330
Other reserves		161 788	161 792
Foreign currency translation differences		-43	-1 620
Accumulated losses		-527 198	-211 834
Profit/loss for the period		481 925	-311 233
Equity	32	5 919 202	6 559 602
TOTAL LIABILITIES AND EQUITY		83 048 372	78 642 032

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