Powszechna Kasa Oszczednosci Bk Plski : Report No. 3/2017 – Amendment to dividend policy of PKO Bank Polski S.A.

Legal basis:

Article 17 section 1 of Market Abuse Regulation

Report contents:

The Management Board of Powszechna Kasa Oszczędności Bank Polski Spółka Akcyjna ('PKO Bank Polski' or the 'Bank') hereby informs that on 2 of March 2017 the Management Board of the Bank adopted 'The Principles for managing the capital adequacy and the internal capital in PKO Bank Polski SA and in the Group of PKO Bank Polski S.A.' ('the Principles') in a new wording which comprises, among others, issues relating to dividend policy.

The aim of the dividend policy is the optimization of the capital structure of the Bank and the Group of the Bank, having considered the return on capital and the cost of capital, the capital needs for development, while ensuring an appropriate level of the capital adequacy ratios. The dividend policy assumes stable payments of dividends in the long term perspective, with respect to the principle of prudent management of the Bank and the Group as well as the possibility of realization of payments out of capital excess over the minimum capital adequacy ratios resulting from the generally applicable legal and regulatory requirements as well as the minimum level of Tier 1 at the level of 14.62%, as specified by the Polish Financial Supervision Authority for the purpose of the payment of the dividend by the Bank. The regulatory requirements should be considered also as the PFSA's, as the competent authority, position regarding the dividend policy for financial institutions, including the Bank.

The dividend policy takes into account factors related to the activity of the Bank and the Group subsidiaries, in particular the supervisory requirements and recommendations with regard to capital adequacy.

The dividend policy has been amended due to the Polish Financial Supervision Authority position issued on 6 December 2016 regarding dividend policy of, among others, banks in 2017 for 2016, of which the Bank informed within the report No. 58/2016 of 7 December 2016. With respect to the above-mentioned position, the threshold values for capital adequacy measures regarding dividend policy were defined in the Principles at a level corresponding with the position of the Polish Financial Supervision Authority, i.e. the Tier 1 exceeding 14.62% as a dividend criterion.

The Principles were approved by the Supervisory Board of the Bank.