Pekao Bank Annual Report 2011

Meeting real needs
with concrete solutions
2011 Annual Report
Every day, life presents new challenges and opportunities. Every day,
we each have a new idea to present that involves tangible needs and requires
clear answers.
In this years annual report, we illustrate our way of banking with projects that
we implemented for businesses, institutions and communities which use our
customised solutions.
The initiatives we present are based on entrepreneurship, courageous
innovation, respect for tradition, and our strong bonds with local communities.
We strongly believe that being a bank today means making a concrete
difference, day in and day out, for those who have chosen to do business
with us. It means facing challenges together and creating a world of new
opportunities.
The projects pictured in the report are only examples of our initiatives.
We are creating a world of relationships, where our stakeholders
can best meet the changing needs of the times.
Annual Report 2011
Contents
Highlights
Supervisory Board and Management Board of Bank Pekao S.A.
Chairwomans Message to the Shareholders
CEOs Letter to theShareholders
Summary of Performance
11
External Business Environment
15
Important Events and Achievements
23
Information for Investors
31
Activities of the Bank Pekao S.A. Group
37
Statement of Financial Position and Financial Results
57
Other Information
77
Corporate Governance
83
Corporate Social Responsibility
103
Prospects for Development
121
Statement of Bank Polska Kasa Opieki Spka Akcyjna

on Application of Corporate Governance Standards in 2011
127
Representations of the Banks Management Board
137
Consolidated Financial Statements of Bank Pekao S.A. Group

for the period ended on 31 December 2011
141
UniCredit Group Profile
275
Bank Pekao S.A. Annual Report 2011
Highlights
2007
2011
2010
2009
2008
COMBINED DATA*
2007
2006
7,731
(3,672)
4,060
3,593
7,218
(3,649)
3,569
3,102
7,053
(3,673)
3,380
2,998
7,834
(3,787)
4,046
4,346
8,355
(3,822)
4,533
4,366
5,398
(2,754)
2,645
2,605
4,658
(2,347)
2,311
2,180
2,899
2,525
2,412
3,528
3,547
2,156
1,788
14.2%
3.7%
38.9%
47.5%
13.1%
3.6%
40.4%
50.6%
14.1%
3.5%
42.1%
52.1%
23.5%
4.1%
39.3%
48.3%
24.7%
3.9%
48.0%
45.7%
23.7%
4.1%
49.3%
51.0%
21.1%
4.2%
48.7%
50.4%
134,090
80,840
99,807
20,257
130,616
79,455
97,250
18,371
131,941
82,512
90,889
16,036
124,096
69,699
89,944
14,747
124,096
69,699
89,944
14,747
67,704
32,747
51,794
8,893
65.3%
20.4%
74.0%
88.2%
14.6%
17.0%
60.3%
23.4%
74.4%
81.0%
15.1%
17.6%
60.8%
21.0%
74.5%
81.7%
14.1%
16.2%
62.5%
17.1%
68.9%
90.8%
12.2%
12.2%
56.2%
19.8%
72.5%
77.5%
11.9%
12.1%
56.2%
19.8%
72.5%
77.5%
11.9%
12.1%
48.4%
25.1%
76.5%
63.2%
13.1%
16.5%
20,357
20,783
20,874
21,992
22,926
22,926
15,647
1,051
1,073
1,089
1,102
1,100
1,100
795
1,910
1,910
1,968
2,004
1,885
1,885
1,262
INCOME STATEMENT (PLN MILLION) SELECTED ITEMS
Operating income**
Operating costs**
Operating profit**
Profit before income tax**
Net profit for the period attributable to
equity holders of the Bank
PROFITABILITY RATIOS
Return on average equity (ROE)

Net interest margin
Non-interest income/operating income
Cost/income
STATEMENT OF FINANCIAL POSITION (PLN MILLION) SELECTED ITEMS
Total assets
Loans and advances to customers***
Amounts due to customers
Equity
146,590
95,679
108,437
21,357
STATEMENT OF FINANCIAL POSITION STRUCTURE RATIOS
Net loans/total assets

Securities/total assets
Deposits****/total assets
Net loans/deposits
Equity/total assets
Capital Adequacy Ratio
EMPLOYEES AND NETWORK
Total number of employees*****

Number of outlets (Bank Pekao S.A.
and PJSC UniCredit Bank)
Number of ATMs (Bank Pekao S.A.
and PJSC UniCredit Bank)
In order to assure data comparability, selected items for 2007 income statement are presented as combined data of the Bank Pekao S.A. Group and Pekao285, i.e. the part of Bank BPH SA
merged with Bank Pekao S.A. as aresult of the merger of the spun-off part of Bank BPH SA as registered on November 29, 2007.
Income statement items for 2006-2007 are in line with those published for these periods respectively.
* Data not audited/reviewed by the independent auditor.
** Income statements for the period 2007-2011 include continuing and discontinued operations.
*** Including debt securities eligible for rediscounting at Central Bank and net investments in financial leases to customers.
**** Deposits include Amounts due to customers.
***** Starting from the first half of 2010 including Centrum Bankowoci Bezporedniej Sp z o.o. (CBB) as aresult of consolidation of the company under the full method since that date.
Annual Report 2011 Bank Pekao S.A.
Supervisory Board and

Management Board of Bank Pekao S.A.
Supervisory Board
Alicja Kornasiewicz
Chairwoman
Roberto Nicastro
Deputy Chairman
Jerzy Wonicki
Deputy Chairman
Alessandro Decio
Secretary
Members
Pawe Dangel
Oliver Greene
Enrico Pavoni
Leszek Pawowicz
Krzysztof Pawowski
Management Board
Luigi Lovaglio
President, CEO
Vice Presidents
Diego Biondo
Marco Iannaccone
Andrzej Kopyrski
Grzegorz Piwowar
Marian Wayski
Chairwomans Message
to theShareholders
The 2011 performance

attests to theBanks strong
position and resilience to
increased volatility on
the financial markets.
The Banks sustainable
growth policy reinforced
its standing of themost stable
bank in terms of efficiency in
the Polish banking sector.
Dear Shareholders,
The Supervisory Board of Bank Polska Kasa Opieki S.A. has
performed an evaluation of theBanks standing in 2011,
in accordance with thecorporate governance rules prescribed
by Best Practices for WSE Listed Companies, adopted by
theWarsaw Stock Exchange. On behalf of theSupervisory
Board, I would like to present ashort summary of
theevaluation.
Another noteworthy achievement was theeffective

management of credit risk: thanks to its consistent and
responsible credit risk policy, theBank reported afurther
improvement in thequality of assets and areduction of
thecost of risk, which gives it competitive edge. Effective
cost management is yet another of theBanks strengths.
In theopinion of theSupervisory Board, Bank Pekao S.A.

has asound economic and financial position, it meets all
therequirements for safe operation and capital adequacy,
and ensures security of funds entrusted by clients.
The 2011 performance attests to theBanks strong position

and resilience to increased volatility on thefinancial markets.
TheBanks sustainable growth policy reinforced its standing
of themost stable bank in terms of efficiency in thePolish
banking sector.
The 2011 performance of theBank and theBank Pekao S.A.

Group was positively assessed by theSupervisory Board.
Net profits earned by theBank and theGroup translated into
areturn on equity of 14.2%. TheBanks focus on business
activities and its highly active presence on themarket
resulted in asignificant growth in theloan portfolio.
As in thepast, theBanks activities in 2011 were appreciated

by themarket, as evidenced by thenumerous domestic
and international awards and distinctions for outstanding
achievements and an innovative approach to developing
banking services. TheSupervisory Board extends its
congratulations to theManagement Board, and shares
theManagement Boards view that themost important

awards were thetitles of Patron of Culture 2011 and Top
Employer Poland 2011, granted in recognition of theBanks
deep commitment to theimplementation of thecorporate
social responsibility strategy, including support of culture and
investments in human capital.
In line with therequirements set forth in Best Practices
for WSE Listed Companies, theSupervisory Board assessed
theinternal control and risk management systems in place
at theBank.
In theopinion of theSupervisory Board, theinternal control
system of Bank Pekao S.A. operates correctly and guarantees
effectiveness of thecontrol processes. Internal control
is acontinuous process, carried out at all organisational
levels: by theBanks governing bodies, its particular
organisational units, supervisors at all management levels,
and all employees. TheManagement Board is responsible
for planning and operation of theinternal control system,
adjusting it to thesize and profile of therisk involved
in theBanks activities. TheSupervisory Board exercises
supervision over theinternal control system and evaluates its
adequacy and effectiveness. It is assisted in theperformance
of this task by theAudit Committee. It is theSupervisory
Boards opinion that theBanks internal control system is
characterised by acomplete and comprehensive approach.
Thededicated structures established at theBank fully cover
thekey risks involved in theBanks operations. With respect
to its subsidiaries, thecontrol functions are performed by
theBanks representatives in therespective companies
supervisory boards.
The Supervisory Board has also expressed apositive opinion
on therisk management system in place at theBank, stating
that it is one of theBanks strengths. Risk management
at theBank is characterised by acomprehensive and
consolidated approach and extends to all theBanks
units and subsidiaries. In line with theregulatory
requirements, theBanks risk management strategy,
adopted by theManagement Board in theform of theICAAP
Procedure, was approved by theSupervisory Board. Therisk
management system is an integral part of theBanks
management system. It involves formal procedures designed
to identify, measure or estimate, and monitor risks, as well
as formal risk mitigation limits. Pursuant to applicable
laws and supervisory regulations, theBanks Management
Board is responsible in particular for thepreparation and
implementation of arisk management strategy, together

with policies and procedures for themanagement of
each type of risk, and for effective operation of therisk
management system and its ongoing improvement.
TheSupervisory Board oversees compliance of theBanks
policy regarding exposures to different types of risk with
theBanks strategy and financial plan.
To sum up, theSupervisory Board views theBank Pekaos
standing as sound and stable. This opinion is based primarily
on thevery good financial performance posted by theBank,
thehigh level of theBanks security, its operational efficiency,
successful and consistent risk management, strong balancesheet and capital structures, strict cost control, and effective
internal control system. Strong fundamentals position
theBank to fully benefit from sustainable development
opportunities and afurther improvement of efficiency. With
its robust capital and liquidity structure, it is well prepared
for thechallenges that 2012 is likely to bring, despite
theexpected deceleration of economic growth.
On behalf of theSupervisory Board, I would like to thank
theBanks Shareholders and Clients for thetrust they have
placed in us. I would also like to thank theManagement
Board and Employees of theBank and theGroup companies
for their dedication and for contributing to theBanks good
performance in 2011. I hope 2012 will bring continued
stable growth of theBanks value for all its stakeholders.
Warsaw, April 26th 2012
Alicja Kornasiewicz
Chairwoman of theSupervisory Board
CEOs Letter
to theShareholders
We are very well

positioned for thefuture.
We have capital,
we have liquidity,
we have one vision
and we live our values
and most of all
we have great people.
Dear Shareholders,
2011 was a period of strong performance for the Bank
Pekao S.A. Group. Our net profit increased by 14.8% to
PLN 2,899m, and our operating profit advanced by 13.8%
to PLN 4,060m. Those results were driven by two related
and critical factors: our clients, who turn to Bank Pekao S.A.
to help them in solving their financial needs, and the focused
commitment and dedication of our people to serving our
clients requirements and to strengthening our culture of
teamwork and excellence.
The operations and performance of Bank Pekao S.A. and
the Pekao Group were strongly influenced by the economic
situation in Poland and the processes occurring in the Polish
banking sector, as well as the trends seen in the global
economy. In 2011, Polands economy was among
the fastest developing economies in Europe, with
the growth rate in excess of 4%. Depreciation of the zoty
benefitted exporters, and good conditions prevailed on
the labour market, particularly in the first half of the year.
The financial condition of the majority of households and

businesses improved. The beneficial economic situation
supported growth of the banking sector.
Bank Pekao S.A. successfully took advantage of
the favourable economic environment in 2011. We made
significant progress driving forward our business and
strategy during 2011. We leveraged our unique position
in the sector to deliver improved performance.
The very strong capital base with Core Tier 1 ratio at
17%, strong funding with loans to deposits ratio well
below 90%, and proven track record in successful risk
management, gave us sound fundamentals for both
profitability improvement and market share gains in key
product areas. Our ROE reached 14.2% even while keeping
very safe capital level, and our ROA went up to 2.2%.
We were ranked as the first lender in new loans in
the country and we expanded our market share in all
targeted lending areas.
We reinforced our leading position in corporate banking,

measured both by the volume of business we were entrusted
by our clients and by our ability to deliver unique, highest
standard solutions. Our corporate loans portfolio increased
by 18.9% to PLN 62.1bn, while corporate deposits grew by
15.4% to PLN 56bn.
Likewise, we materially strengthened our position in retail
banking, where our long term focus and expertise in PLN only
lending products allowed us to continue growth strategy on
a decelerating market. Our PLN mortgage portfolio increased
by 26% to PLN 20.3bn, and consumer loans portfolio
expanded by 15.2% to PLN 6.8bn.
We continued to launch new innovative products, which
at the same time are safe, user-friendly and highly usable.
Bank Pekao was recognised as a true leader of innovation on
the retail market with its new mobile banking offering, which
was highly rated by experts.
We improved significantly the quality of our work,
regularly measured in customer and employee satisfaction
surveys. This was another year when the dedication
and hard work of our employees resulted in improved
satisfaction results and stronger reputation of the Bank.
Care for the interests of our clients is our guiding principle,
and the security of funds entrusted to us our top priority.
We build our reputation on our values and first of all, on
ethical, customer-oriented behaviour. We strongly believe
that what is good for our customers, it will be good for
the Banks reputation.
We are also engaged in and committed to supporting our
society above and beyond fruits of our normal business
activity. We consider corporate social responsibility as
a permanent rule of conduct, which we seek to follow when
building relations with our environment. Among others,
we have actively participated for many years in The Great
Orchestra of Christmas Charity, one of the leading charity
projects in Poland.
We managed to deliver all this while keeping strict cost

discipline, with operating costs growing by 0.6% and
cost to income ratio improving further to 47.5%, while
keeping investing for the future.
On behalf of the Management Board, I would like to thank
our Clients and Shareholders for the trust placed in the Bank,
the Supervisory Board for their support to our initiatives and
the Banks employees for their commitment and hard work.
I extend my personal thanks to the Management Board
members, my closest associates, for our good, concerted
cooperation.
We are very well positioned for the future. We have capital,
we have liquidity, we have one vision and we live our values,
and most of all, we have great people. We have clear plans
to continue growing revenues, earnings and return on equity.
We keep focus on a range of key strategic imperatives
strong reputation, customer satisfaction, sound risk and
cost management and price discipline.
We want to be leader also in promoting the sustainable
economic growth and the quality of life in Poland, as we
believe that only in this way we can guarantee sustainability
of our business and value creation.
We are committed to continue delivering first-class service
to our clients and building long-term value for all our
shareholders as we write the next chapter in Bank Pekaos
proud history.
Warsaw, March 19th 2012
Luigi Lovaglio
President of theManagement Board, CEO
In pursuance of our CSR mission we also engage in charitable

activities through the Marian Kanton Bank Foundation,
established and financed by Bank Pekao. We continue to
support Polish culture. In recognition of our involvement in
supporting and promoting culture and art, we were honoured
with the title of Patron of Culture 2011 by the Minister of
Culture and National Heritage.
11
The Bank Pekao Group reported solid financial results for 2011, with the
net profit attributable to equity holders amounting to PLN 2,899.4 million,
up by PLN 374.2 million (14.8%) in comparison with 2010.
The robust performance in 2011, with the operating profit higher by
13.8% relative to 2010, was driven mainly by the improved operating
income, with operating costs kept under control (up by only 0.6%, well
below the inflation rate).
The strength of the capital and liquidity structure of the Bank Pekao
Group is reflected in the capital adequacy ratio of 17.0% and the loans to
deposits ratio at the level of 88.2% as at the end of December 2011.
This provides abasis for further sound and stable development of the
Groups activity.
The Bank continued its policy of offering only PLN mortgage loans.
The residual stock of mortgage loans denominated in foreign currencies,
almost entirely acquired as aresult of the merger with the spun-off part
of Bank BPH SA, represents 6.5% of the Banks total loans.
In 2011, the Groups operating income amounted to
PLN 7,731.3 million, which means an increase of PLN 513.3 million
(7.1%) on 2010, with growth in total net interest income, dividend income and income from equity investments as well as net non-interest
income, in particular net fee and commission income.
Total net interest income, dividend income and income from equity
investments in 2011 amounted to PLN 4,724.3 million and rose by
PLN 421.3 million (9.8%) in comparison with 2010. Key factors contributing to the rise were higher volumes and effective management of
the interest margin.
The Groups net non-interest income amounted to
PLN 3,007.0 million, an increase of PLN 92.0 million (3.2%)
in comparison with 2010, mainly as aresult of higher net fee and
commission income and improved trading result.
In 2011, the operating costs were kept under control and amounted
to PLN 3,671.7 million. They were higher than the operating costs in
2010 by only PLN 22.6 million (0.6%), well below the inflation rate.
Net impairment losses on loans and off-balance sheet commitments
amounted to PLN 537.9 million, which is alevel similar to that reported
for 2010.
As at December 31st 2011, the ratio of impaired receivables to total
receivables stood at 6.3% and was better by 0.4 p.p. than as at the
end of 2010.
12
As at the end of December 2011, total amounts due to the Groups

customers (including customer deposits, repo and sell-buy-back
transactions, structured certificates of deposit, and certificates of
deposit) amounted to PLN 110,153.1 million, an increase of
PLN 10,087.0 million (10.1%) in comparison with the end of 2010.
The total volume of retail customer deposits and structured certificates
of deposit amounted to PLN 48,762.7 million as at the end of 2011,
and was PLN 2,424.6 million (5.2%) higher in comparison with the
end of 2010. The value of the net assets of investment funds managed
by Pioneer Pekao TFI S.A. was PLN 13,780.9 million as at the end of
2011, which means adecrease of PLN 4,277.9 million (23.7%) relative to the end of 2010, driven by the unfavourable situation on capital
markets.
The total volume of corporate customer deposits, repo and
sell-buy-back transactions, and certificates of deposit amounted to
PLN 61,390.4 million as at the end of 2011, an increase of
PLN 7,662.4 million (14.3%) as compared with the end of 2010.
As at the end of 2011, the volume of retail loans stood at
PLN 36,733.5 million, having grown by PLN 5,187.8 million (16.4%)
relative to the end of 2010. The growth was achieved on the back of
high dynamics of sales of key lending products. Thanks to commercial focus, in 2011 the Banks sales of consumer loans increased by
18% and sales of PLN mortgage loans were higher by almost 27%
compared with 2010.
The volume of corporate loans, non-quoted securities, reverse repo
transactions and securities issued by local governments increased by
PLN 10,261.4 million (19.1%) as compared with the end of 2010 and
amounted to PLN 63,914.8 million as at the end of 2011.
Economic Growth
16
Labour Market
16
Inflation and Monetary Policy
17
Fiscal Policy
17
Foreign Sector
18
Capital Market
18
Banking Sector
19
Ukraine21
15

Economic Growth
According to the preliminary estimates released by the Polish Central
Statistical Office, Polands GDP growth rate in 2011 was 4.3% (higher
than in 2010, when it equalled 3.9%), and individual consumption rose
by 3.1%.
While the growth rate remained at asimilar level to the previous year, the
growth structure changed. Investment expenditures became asignificant
component of the domestic demand. This was mainly due to the public
sector investments, however arevival of investment activity was also
evident in the private sector. In the second half of 2011, the impact of
domestic demand on the GDP growth was lower. Data for the fourth
quarter show asignificant downturn in private consumption, which can
be largely attributed to the deterioration on the labour market. In the
second half of the year, amore and more significant growth driver was
net exports. In 2010, net exports negatively affected the GDP growth rate,
whereas in 2011 they had apositive impact. It is also worth noting that
an improvement in the price competitiveness of Polish exporters, due to
the depreciation of the Polish currency in the second half of 2011, was
an important factor supporting strong export sales.
The GDP growth rate in 2012 is forecast at 3.1% year on year. aslowdown in investment growth is expected relative to 2011, owing mainly to
the deterioration of economic prospects abroad. Similarly to the second
half of 2011, net exports will be asubstantial growth driver for GDP.
Labour Market
Average employment at Polish companies in December 2011 was
5,503.2 thousand, i.e. 123.8 thousand more than in December 2010.
However, this growth is attributable in alarge part to an update of the
statistical sample by the Polish Central Statistical Office at the beginning
of 2011 (increase in the number of companies employing more than
9 persons), contributing 121.6 thousand to the employment growth figure.
The first half of 2011 brought afurther improvement on the Polish labour
market and rising employment, which peaked in July at the level of
5,528.1 thousand. The second half of the year saw agradual reduction in
the number of jobs. The decrease in the employment rate affected mainly
the processing industry, and was due to aslump in foreign orders.
The unemployment rate slightly increased from the 12.4% reported as at

the end of 2010, reaching 12.5% as at the end of December 2011.
The jobless rate is likely to continue an upward trend in 2012.
Due to the worsening situation on the labour market, the wage pressure
in the Polish enterprise sector remained at amoderate level in 2011,
although inflation expectations of households grew significantly. Average
pay in the enterprise sector rose by 5.0% year on year, compared with
3.3% in 2010. As aresult, nominal wages in the enterprise sector increased by 8.4% year on year (4.1% in 2010), which translates into 3.9%
in real terms (1.5% in 2010) given the high inflation level.
The falling employment rate was accompanied by adecline in the number

of job offers, resulting primarily from areduction in job subsidies.
22
30
20
25
18
20
16
15
14
10
12
4
2
0
-2
10
-4
-5
06
16
0 4 0 4 05 05 0 6 0 6 07 07 0 8 0 8 0 9 0 9 1 0 1 0 1 1 1 1
. 2 0 2 . 2 0 6 . 2 0 2 . 2 0 6 . 2 0 2 . 2 0 6 . 2 0 2 . 2 0 6 . 2 0 2 .2 0 6 .2 0 2 . 2 0 6 . 2 0 2 . 2 0 6 . 2 0 2 . 2 0
1
0
1
0
1
0
1
0
1
0
1
0
1
0
1
01
.20
06
07
.20
06
01
.20
07
07
.20
07
01
.20
Employment in the corporate sector (%, YoY, LA)
Retail Sales (%, yoy)
Unemployment rate (%, RA)
Wage bill (%, yoy)
08
07
.20
08
01
.20
09
.20
07
09
01
.20
10
.2 0
07
10
01
.20
11
07
.20
11
Inflation and Monetary Policy

CPI inflation in 2011 remained significantly above the inflation target set
by the National Bank of Poland (NBP). According to estimates by the Polish Central Statistical Office, average CPI inflation was 4.3% year on year,
reaching the level of 4.6% in December 2011.
The main factors behind the continued increased level of the CPI index
were food prices, expenditures related to the use and maintenance of
dwellings and energy, with asubstantial contribution from transport
prices, and in particular the prices of fuel. The impact of those factors
was amplified by non-recurrent events such as an increase in the VAT
and excise tax rates at the beginning of the year, changes of administered
and regulated prices, and amodification of the seasonal goods price
monitoring system introduced by the Polish Central Statistical Office. In
addition, fluctuations of the Polish zoty exchange rate, and especially its
depreciation, had an effect on the prices of raw materials imported to
Poland. Decrease in the CPI inflation rate in the second half of 2011 was
slower than expected, mainly due to changes in law concerning, inter alia,
kindergarten fees and implementation of new Ministry of Healths regulations on reimbursable drug prices.
Lingering inflationary pressures, including arise in the prices of services,
had arelatively lasting effect on net core inflation, which at the end of
2011 reached the level of 3.1%, with an annual average of 2.4%, slightly
below the inflation target.
2012 is expected to bring agradual decrease in the CPI inflation, heading
for the inflation target. However, whether the target will be achieved will
depend on the degree of the Polish zoty appreciation during the year. The
pace of the core inflation decline will be slower. The average growth rate
of CPI and core inflation will remain above the inflation target.
Appraisal of the inflation prospects at the beginning of 2011 and the
relatively stable path of economic growth in Poland prompted the Monetary Policy Council to begin the cycle of monetary tightening. Overall, the
Monetary Policy Council raised interest rates in the first half of 2011 by
100 b.p. in four steps, ending the series of increases with the reference
rate at 4.5%. The second half of the year saw exacerbation of the risks
threatening Polands economy, arising mainly from external conditions.
The economic situation on foreign markets, especially the debt crisis in
Europe, increased concerns about the scale of the economic slowdown in
the region and globally.
Financial markets uncertainty contributed to easing monetary conditions
in Poland through asubstantial weakening of the Polish zoty as aresult of
an increased risk aversion on the market. Taking into account the impact
of the Polish currency depreciation on the expected path of inflation in
Poland, the National Bank of Poland decided to embark on aseries of interventions on the currency market in order to stabilise the exchange rate.
Concerns about the development of the situation in the euro zone and in
the global economy, coupled with the elevated CPI inflation path, increase
the probability of interest rate stabilisation in Poland in the first months
of 2012. Signs of an economic slowdown in Poland and agradual drop
in CPI inflation may encourage the Monetary Policy Council to loosen
monetary conditions.
Fiscal Policy
Poland posted alower-than-expected budget deficit in 2011, which
followed from higher-than-forecast non-tax income (mainly due to excise
duties and profit transfer from the National Bank of Poland) and tax
revenue on PIT, CIT and VAT (taking into account the effect of increases
in the VAT tax rates and higher than expected inflation and GDP growth
rates in 2011). Another contributor was lower spending, driven mainly by
reduced money transfer to open-end pension funds.
The parliamentary election in Poland in October 2011 caused uncertainty
about the continuation of fiscal consolidation plans. The electoral success
of the ruling coalition garanteed that the fiscal convergence programme
would be implemented.
Facing the deteriorating economic prospects, the Ministry of Finance prepared in December an altered Budget Bill for 2012, which incorporated
revised macroeconomic assumptions and additional measures (reforms)
aimed at updating the public finance consolidation plan.
The Budget Bill for 2012 provides for the following government initiatives
designed to bring the public sector deficit to alevel below 3% of GDP:
introduction of atemporary expenditure rule,
2 p.p. rise in the disability pension contribution,
changes in excise taxes increase in the excise tax on tobacco and
fuel, removal of the preferential excise tax rate on bio-fuels,
introduction of an expenditure rule for local government units,
changes in the capital gains tax and increase in dividends,
introduction of silver and copper mining fees.
Plans of the Ministry of Finance concerning the long-term planning of
public finances include raising the retirement age, removal of selected
tax abatements, changes in farmers social insurance, and introduction of
apermanent expenditure rule.
Consistent completion of fiscal consolidation plans by the Polish government enhanced the perception of Poland by the financial markets,
including rating agencies, creating very good conditions for covering the
borrowing needs at the beginning of 2012.
17
External Business Environment (cont.)

Foreign Sector
In 2011, there was afurther increase in the State Treasurys foreign debt.
According to the data of the Ministry of Finance, as at the end of December 2011, it amounted to PLN 246.4 billion, which translates into ca.
PLN 51.6 billion growth (26.5%) relative to the end of December 2010.
The growth was partly aresult of the weakening of the Polish zoty against
the foreign currencies in which the Polands foreign debt is denominated.
According to initial estimates by the National Bank of Poland, in 2011

the current account deficit amounted to EUR 15.2 billion vs.
EUR 16.5 billion in 2010, which means adrop in relation to GDP
to 4.1%, from 4.7% in 2010.
The lower current account deficit resulted from an improved services
account surplus (growth to EUR 4.9 billion from EUR 2.3 billion in 2010)
and arise in the current transfers account balance surplus (from
EUR 2.8 billion in 2010 to EUR 4.1 billion), due to increased absorption of
funds from the EU.
Higher trade deficit and net income account deficit affected the current
account balance. Goods trade account deficit increased from
EUR 8.9 billion in 2010 to EUR 10.3 billion in 2011 as exports dynamics
(23.0% in 2010 vs. 10.3% in 2011) slowed down more significantly than
the dynamics of imports (25.1% in 2010 vs. 10.7% in 2011). At the same
time, higher net income account deficit was connected with increased
dividend payments by Polish companies, due to their improving financial
performance: the net income account deficit rose to EUR 13.9 billion from
EUR 12.8 billion in 2010.
2011 brought asignificant decline in foreign portfolio investments to
EUR 11.0 billion, from EUR 19.9 billion in 2010. This trend was seen in
both treasury and equity securities, which was aconsequence of asignificant rise in risk aversion on the global financial markets. On the other
hand, the inflow of foreign direct investments was markedly higher than in
2010: ca. EUR 9.9 billion in comparison with EUR 6.7 billion in 2010. Foreign direct investments financed ca. 65% of the current account deficit in
2011, which is an acceptable level, much better than in 2010 (ca. 41%).
2,000
40
1,500
30
1,000
20
500
10
-500
-10
-1,000
-20
-1,500
-30
-2,500
-40
-3,000
-50
05
.2
00
11 4
.2
00
05 4
.2
00
11 5
.2
00
5
05
.2
00
6
11
.2
00
05 6
.2
00
11 7
.2
00
05 7
.2
00
11 8
.2
00
05 8
.2
00
11 9
.2
00
05 9
.2
01
11 0
.2
01
05 0
.2
01
11 1
.2
01
1
-2,000
C/A balance (EUR m, LA)

Exports (%, YoY, RA)
Imports (%, YoY, RA)
18
Capital Market
While 2010 proved to be successful for the Polish stock market, 2011
saw amarkedly higher volatility, and as aresult ended with asignificant
decrease of indices. Stock prices continued an upward trend during the
first half of the year, and consequently there were no signs of the dramatic changes that started in July and August. Among the major factors
shaping market trends were the developments and changes in sentiments
on global financial markets. The weakness of the Warsaw Stock Exchange
(WSE) in relation to more mature markets was further exacerbated by the
reduced demand from local institutional investors (mainly open-end pension funds, which were affected by lower contribution transfers).
The key drivers of the situation on the global financial markets, including
stock markets, were as follows: political tensions in Arabic countries, the
earthquake in Japan, the prolonged dispute over the U.S. public debt ceiling, downgrade of the U.S. credit rating, aseries of credit downgrades in
the euro zone, increased concerns over the possible spill-over of the crisis
to Spain and Italy, as well as failure to agree on solid anti-crisis measures
in Europe despite aseries of EU summits. Especially Standard & Poors
decision to downgrade the United States credit rating from the highest
level surprised investors and sent major stock market indices down more
than 10 per cent within afew days.
During the rest of the year, stock markets all over the world strived
to make up for the losses, however with varying degrees of success.
Unfortunately, the Warsaw Stock Exchange was among those that did
not succeed, although the economic outlook (Polands economy was
going to slow down less than other European economies) had suggested
acompletely different scenario.
In an environment marked with agrowing risk aversion and aflight to
safe-haven investments, investors reactions were very sharp, which repeatedly led to double-digit drops in the prices of less liquid equities. The
vast majority of companies listed on the WSE are trading at adiscount
and, given the rather optimistic growth prospects, their stock prices may
appreciate in 2012.
The worst result was achieved by WIG-Plus index (40.77% decline in
value), representing the behaviour of the smallest companies quoted
on the WSE, which do not qualify for the WIG20, mWIG40 or sWIG80
index. The drop of WIG20, the blue chip index, was substantially smaller
(21.85%). The relatively best performer was the broad market index
WIG (20.83% drop in value).
Indeks WIG
Index WIG20
50,000
3,000
48,000
2,800
46,000
44,000
2,600
42,000
2,400
40,000
2,200
38,000
36,000
Despite the poor sentiment, the WSE continued to attract new issuers.
In 2011, it was the place of more IPOs than any other European stock
exchange, with 172 companies floating their shares on the alternative investment market NewConnect. Thirty eight IPOs were carried out on the
WSE main market, slightly more than in 2010 (34 companies). The total
number of companies listed on the WSE main market and parallel market
(without NewConnect) as at the end of 2011 was 426, of which 39 were
foreign companies. The market capitalisation of the WSE decreased by
19.3% in 2011, to PLN 642.9 billion.
Banking Sector
In 2011, the overall condition and performance of the banking sector
were driven by the macroeconomic determinants. Notably, continuation
of the relatively strong economic growth contributed to improved financial
standing of businesses and households, which in turn reduced the cost of
risk. Increased volatility across financial markets, caused by an escalation
in the euro area crisis, left the sectors results unaffected, and only minor
adjustments to interest rates made by the central bank had no significant
impact on the banking operations.
The year-on-year growth in the value of banks assets accelerated, to
reach 11.7% at the end of 2011 (compared with a9.6% year-on-year
rise recorded in December 2010).
In 2011, the following changes occurred in key deposit categories:1
a 13.5% year-on-year rise in deposits from households (compared
with a9.8% year-on-year rise reported in 2010). Key factors
1
2
11
11
.2
0
12
11
.2
0
11
11
.2
0
10
11
.2
0
09
11
08
.2
0
11
.2
0
07
11
.2
0
06
11
.2
0
05
11
.2
0
04
11
.2
0
03
.2
0
02
01
.2
0
11
11
11
.2
0
12
11
.2
0
11
11
.2
0
10
11
.2
0
09
11
.2
0
08
11
.2
0
07
11
.2
0
06
11
.2
0
05
11
.2
0
04
11
.2
0
03
.2
0
02
01
.2
0
11
2,000
The behavior of particular asset classes during the year had an impact on
the decisions of retail investors, and therefore more aggressive forms of
investment did not fare well. According to data of the Analizy Online service,
the assets of investment funds shrank by PLN 5.7 billion (4.8%) in 2011,
with net redemptions of PLN 3.3 billion. Similarly to 2010, the major beneficiaries were money market funds and bond funds (net subscriptions of
PLN 4.2 billion). The statistics for equity and mixed funds were worse
(net redemptions of PLN 2.9 billion and PLN 5.8 billion respectively).
Net assets of equity funds and mixed funds decreased by more than 32%
and 29% respectively. On the other hand, some types of funds posted net
asset growth. These included private equity funds (up by 44.3%), debt
funds (up by 17.1%) and money market and cash funds (up by 20.2%).
contributing to the enhanced growth included higher incomes earned

by households and ashift in the savings structure towards less risky
assets,
a 12.1% year-on-year rise in corporate deposits (compared with
a9.9% year-on-year rise reported in 2010). The major contributors to the robust growth in corporate deposits were strong financial
performance figures and certain non-recurring factors, such as ample
proceeds earned by companies from the sale of financial assets at the
end of the year2,
a 1.6% year-on-year rise in other deposits (compared with a3.9% yearon-year rise reported in 2010). The tepid growth in the category was
caused by asharp decline in deposits from the Social Security Fund.
As aresult of the changes described above, the deposit structure was
as follows: at the end of 2011 households deposits, corporate deposits
and other deposits represented 62.7% (end of 2010: 61.8%), 26.7%
(end of 2010: 26.6%), and 10.6% (end of 2010: 11.6%) of total deposits,
respectively.
Based on aggregates published by the NBP for all monetary financial institutions, covering liabilities other than deposits and receivables other than loans.
Notably, sale of Polkomtel shares.
19
External Business Environment (cont.)
As for the main loan categories, the following changes occurred in 2011:
a 11.9% year-on-year rise in loans to households (compared with
a14.0% year-on-year rise reported in 2010). The rise was driven by
growth in housing loans, with consumer lending remaining sluggish. To
note, the 2011 results were inflated by the depreciation of the Polish
currency, which led to an increase in the value of foreign currency
loans (notably CHF-denominated loans). Year-on-year growth in loans
to households cleared of the effect of FX differences is estimated in
the range of 7-8%,
a 19.1% year-on-year rise in loans to businesses (compared with
a0.2% year-on-year drop reported in 2010). The rise was fuelled by
arecovery in investment across the enterprise sector and increased
borrowing of funds to finance M&A transactions. Similarly to the
loans-to-households category, the depreciation of the zoty inflated
the year-to-year growth in loans to businesses (by some 5 percentage
points, according to estimates),
a 16.5% year-on-year rise in other loans (compared with a10.3%

year-on-year rise reported in 2010). The category rose mainly on the
back of stronger portfolio of loans to local government institutions (up
by 23.1% year on year) and aslight increase (2.9% year on year) in
debt contracted by non-banking financial institutions.
At the end of 2011, loans to households, loans to businesses and
other loans accounted for 61.0% (end of 2010: 62.3%), 29.7% (end of
2010: 28.5%) and 9.3% (end of 2010: 9.2%) of the total loan portfolio,
respectively.
At the end of 2011, gross loans to deposits ratio was 115.6%, compared
with 112.9% in December 2010 (if calculated using net receivables, the
figure would be 104.7% and 102.1%, respectively).
Loans and deposits
Loans by main sectors
01
10
.2
01
07
.2
01
.2
04
0
01
.2
01
01
.2
10
01
.2
07
0
04
.2
01
9
01
.2
01
00
.2
10
9
07
.2
00
00
00
.2
.2
04
01
.2
10
01
07
.2
01
.2
04
01
.2
01
01
.2
10
01
.2
07
01
04
.2
01
.2
01
00
.2
10
00
.2
07
00
00
.2
.2
04
01
50%
40%
30%
20%
10%
0%
-10%
-20%
01
122%
120%
118%
116%
114%
112%
110%
108%
106%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Loans to households (y/y)
Loans to deposits (r.s.)
Loans to non-financial corporations (y/y)
Total deposits (y/y)
Other loans (y/y)
Total loans (y/y)
Non-performing loans, % of portfolio
Loans to large corporations
Other deposits (y/y)
Loans to SME
Consumer loans
01
1
09
.2
01
1
06
.2
01
1
03
.2
01
0
12
.2
01
0
09
.2
01
0
01
0
06
.2
00
9
Deposits of non-financial corporations (y/y)
Housing loans
20
03
.2
Deposits of households (y/y)
00
9
01
.2
00
9
04
.2
00
9
07
.2
00
9
10
.2
00
9
01
.2
01
0
04
.2
01
0
07
.2
01
0
10
.2
01
0
01
.2
01
1
04
.2
01
1
07
.2
01
1
10
.2
01
1
-20%
12
.2
0%
-10%
00
9
10%
09
.2
20%
06
.2
30%
00
9
40%
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
03
.2
Deposits by main sectors
The quality of the loan portfolio is of fundamental importance. The year

under review saw:
a marked decline in non-performing loans in the loans-to-businesses
category, from 12.3% of the total loan portfolio in December 2010 to
10.5% at the end of 2011, as aconsequence of the nominal value of
non-performing loans having stabilised, with the entire portfolio having
experienced substantial growth,
the share of non-performing loans in total loans to households remaining above 7% (7.2% at the end of 2011, flat on December 2010). In
this loan category, asteady, slow uptrend is observed in the proportion
of non-performing housing loans (2.3% in December 2011, compared
with 1.8% in December 2010). The share of non-performing loans in
total loans to households excluding housing loans was 14.6% at the
end of 2011 (December 2010: 14.0%).
In terms of financial performance, Polands banking sector showed arobust improvement in 2011. According to the Polish Financial Supervision
Authority, the sector posted overall net profit of PLN 15.7bn, up by 37.5%
on the prior year. The key growth drivers were higher net interest income
and lower cost of impairment losses on loans, accompanied by an only
slight increase in operating expenses.
Presented below are landmark changes in the regulatory framework in
2011:
further measures taken to restrict borrowers access to foreign currency loans,
scaling down of the Family in Their Own Home housing loan subsidy
scheme, and
changes to tax law designed to eliminate evasion of capital gains tax
on deposits with interest compounded daily.
A full effect of the changes listed above will be visible in 2012.
Ukraine
In 2011, the Ukrainian economy sustained its economic growth from
2010. The International Monetary Fund estimates that Ukraines GDP
went up by 4.7% in 2011, after a4.2% growth in 2010 and a14.5%
decline in 2009. The estimates of the National Bank of Ukraine put the
2011 economic growth rate even higher, stating it possibly exceeded 5%.
The main driver of the economic growth was domestic demand. Increased
consumption was supported by astrong employment growth and higher
real wages as well as higher investment in inventories.
According to estimates, Ukrainian grain harvest in 2011 was in excess

of 55 million tonnes. Likewise, the production of certain vegetables
and oilseed crops was also higher than ever before. The growth engine
for the construction industry was the infrastructure projects connected
with the European Football Championship UEFA EURO 2012, which
is to be co-hosted by Ukraine. Towards the end of 2011, there was
aslowdown of economic activity in the industrial sector, mainly due to
weaker foreign demand.
The inflation rate in Ukraine fell to 4.6% as at the end of 2011, in
comparison with 9.1% at the end of 2010. This strong decline began
in September and was mainly driven by afall in food prices after the
record high harvest. Another major factor lowering the inflation rate
in 2011 was keeping the gas tariffs for household consumers at an
unchanged level.
Although the inflation dropped, the Central Bank of Ukraine tightened the
monetary policy in the second half of the year by reducing liquidity in the
banking sector. The second half of the year also brought an increase in
interest rates on the money market. The National Bank of Ukraine intervened on the foreign exchange market throughout the year, which helped
to stabilise the exchange rate of the Ukrainian Hryvnia against U.S. Dollar
at around UAH 8/USD 1.
Thanks to ahigh rate of economic growth, which translated into
improved financial performance of the corporate sector, budgetary
revenues grew substantially. According to estimates, budget deficit
amounted to ca. 1.7% of GDP in 2011. However, the good budget
results should not be viewed as areason for optimistic conclusions
for the future, because the increase in tax revenue was mainly caused
by changes of accounting principles governing recognition of retained
losses.
It is estimated that Ukraine did not manage to reduce the public sector
deficit to the target level of 3.5% of GDP in 2011. afactor of key importance to Ukraines public finance is the gas conflict with Russia, which
does not agree to reduce its gas prices. Under these circumstances,
the main IMF requirement is that gas prices for Ukrainian consumers
should be raised, but so far the Ukrainian government has refrained
from taking that step.
Negotiations between Ukraine and Russia on gas prices and further cooperation with the International Monetary Fund remain fundamental issues
for Ukraines macroeconomic situation in 2012.
The main sectors of the economy that contributed to the growth

were agriculture, construction industry and domestic trade. The good
performance of the agriculture sector was due to arecord-high harvest.
21
Bank Pekao
as Patron of Culture 2011
Bank Pekao was the only commercial company that received the Patron of Culture 2011 title,
awarded by the Minister of Culture and National Heritage for the Banks steady commitment to
supporting high culture. Bank Pekao was nominated to this prestigious award by our partners
over twenty leading cultural institutions across Poland.
Changes within the Group

24
Change of Name, Legal Form and Registered Office of aCompany 24
Liquidation of aCompany
24
Changes in the Statutory Bodies of the Bank
Supervisory Board
Management Board of the Bank
24
24
25
Organisational Changes
25
Awards and Distinctions
26
Bank Pekao S.A. as National Sponsor of the UEFA European

Football Championship UEFA EURO 2012
and the Official Bank of the Championship in Poland
28
23

Changes within the Group
The composition of the Bank Pekao Group is presented in the Notes to
the Consolidated Financial Statements of the Bank Pekao Group for the
period ended December 31st 2011.
company, and currently the banks full name is Public Joint Stock Company UniCredit Bank. The registered office of the bank was moved from
Luck to Kiev.
The most significant developments concerning the Group are presented

below.
Liquidation of aCompany
Change of Name, Legal Form

and Registered Office of aCompany
On October 20th 2010, the Extraordinary General Meeting of Holding

Sp. z o.o. in liquidation resolved to commence the process of liquidation
of the company, whose operations had already been discontinued. The
liquidation process will be continued in 2012.
On February 8th 2011, the legal form of OJSC UniCredit Bank Ukraine
was changed from open joint stock company to public joint stock
Changes in the Statutory Bodies

of the Bank
Supervisory Board
Mr. Sergio Ermotti, Member of the Supervisory Board, resigned from his
position in the Supervisory Board with effect from February 23rd 2011.
On April 14th 2011, Mr. Federico Ghizzoni, Deputy Chairman and
Secretary of the Supervisory Board, resigned from his positions in the
Supervisory Board with effect from April 30th 2011.
The Ordinary General Meeting of Shareholders held on April 19th 2011
appointed Mrs. Alicja Kornasiewicz and Mr. Alessandro Decio to the
Supervisory Board, with effect from May 1st 2011 and April 19th 2011
respectively.
At ameeting held on June 1st 2011, the Supervisory Board appointed
Mrs. Alicja Kornasiewicz as Chairwoman of the Supervisory Board (upon
her resignation from the position of President of the Banks Management
Board), Mr. Jerzy Wonicki (who resigned from the position of Chairman of
the Supervisory Board) as Deputy Chairman of the Supervisory Board, and
Mr. Alessandro Decio as Secretary of the Supervisory Board.
24
Composition of the Supervisory Board of Bank Pekao S.A.:

31.12.2011
31.12.2010
Alicja Kornasiewicz
Jerzy Wonicki
Chairwoman of the Supervisory Board
Chairman of the Supervisory Board
Roberto Nicastro
Federico Ghizzoni
Deputy Chairman
of the Supervisory Board
Deputy Chairman,
Secretary of the Supervisory Board
Jerzy Wonicki
Roberto Nicastro
Deputy Chairman of the Supervisory Board
Deputy Chairman of the Supervisory Board
Alessandro Decio
Pawe Dangel
Secretary of the Supervisory Board
Member of the Supervisory Board
Pawe Dangel
Sergio Ermotti
Oliver Greene
Oliver Greene
Enrico Pavoni
Enrico Pavoni
Leszek Pawowicz
Leszek Pawowicz
Krzysztof Pawowski
Krzysztof Pawowski

On April 14th 2011, Mrs. Alicja Kornasiewicz resigned from the position
of President of the Banks Management Board with effect from
April 30th 2011.
On April 14th 2011, based on the Supervisory Boards unanimous decision, which entered into force on May 1st 2011, Mr. Luigi Lovaglio was
appointed as President of the Management Board and CEO for the current
joint term of office of the Banks Management Board. The appointment
took effect from the date of obtaining the approval of the Polish Financial
Supervision Authority.
On July 19th 2011, the Polish Financial Supervision Authority unanimously approved the appointment of Mr. Luigi Lovaglio as President of
the Management Board of the Bank.
Composition of the Management Board of Bank Pekao S.A.:
31.12.2011
31.12.2010
Luigi Lovaglio
Alicja Kornasiewicz
President of the Management Board, CEO
President of the Management Board
Diego Biondo
Luigi Lovaglio
Vice President of the Management Board
First Vice President of the Management Board

General Manager
Marco Iannaccone
Diego Biondo
Andrzej Kopyrski
Marco Iannaccone
Grzegorz Piwowar
Andrzej Kopyrski
Marian Wayski
Grzegorz Piwowar
Members of the Management Board coordinate and supervise the Banks

operations in line with the allocation of responsibilities adopted under
a resolution of the Management Board and approved by the Supervisory
Board.
Mr. Luigi Lovaglio, President of the Management Board, coordinated
the activities of the Members of the Management Board and supervised a number of areas of the Banks activity, in particular: internal
audit, compliance, and corporate communication, including investor
relations.
Mr. Luigi Lovaglio headed the Management Board, convened and presided over the Board meetings, presented its stance to other governing
bodies of the Bank and in relations with third parties, in particular with the
state authorities, and issued internal regulations.
Mr. Diego Biondo, Vice President of the Management Board, supervised
the activity of the Risk Management Division.
Mr. Marco Iannaccone, Vice President of the Management Board,
supervised the activity of the Finance Division.
Mr. Andrzej Kopyrski, Vice President of the Management Board,
supervised the activity of the Corporate Banking and MIB Division.
Mr. Grzegorz Piwowar, Vice President of the Management Board,
supervised the activity of the Retail Banking Division.
Mr. Marian Wayski, Vice President of the Management Board,
supervised the activity of the Logistics and Procurement Division.
Marian Wayski
Members of the Management Board are appointed for ajoint three-year

term of office. They are appointed and removed from office by the Supervisory Board. Vice Presidents and Members of the Management Board are
appointed and removed from office upon the request of the President of
the Management Board. Appointment of two members of the Management Board, including the President, is subject to approval by the Polish
Financial Supervision Authority. The body which applies for the approval is
the Supervisory Board.
The Management Board runs the Banks affairs and represents the Bank.
The Management Boards powers and responsibilities include all matters
which, pursuant to the provisions of law or the Banks Statute, do not fall
within the scope of competence of other governing bodies. The rules and
procedures for the activities of the Banks Management Board are stipulated in the Rules of Procedure for the Management Board of the Bank.
Organisational Changes
In 2011, there were changes in the organisational structure of Bank
Pekao S.A.s Head Office.
One of key developments was the establishment of the Global Banking
Services Area, grouping together the activities of the Organisation Division, IT Division, HR Shared Service Centre, Cost Management Department, and anewly created GBS Support Office.
Creation of the Global Banking Services Area was aimed at streamlining
the Banks activities relating to: operations and support services offered
to business divisions, increasing the scope for economies of scale,
improvements in the quality and efficiency of operational processes
and technical solutions, as well as the potential for optimisation of
administrative costs.
25
Important Events and Achievements (cont.)

Awards and Distinctions
The activities of Bank Pekao S.A. in 2011 gained wide recognition,
as evidenced by numerous awards and distinctions from both
Polish and foreign institutions, the most significant of which are
presented below.
The honours of particular importance to the Bank in 2011, besides those
received for achievements in the development of banking services and
consumer relations, were the awards bestowed on Bank Pekao S.A. in
appreciation of its commitment to the pursuance of the Corporate Social
Responsibility (CSR) strategy: the titles of Patron of Culture 2011 and Top
Employer Poland 2011.
Bank Pekao S.A.
Patron of Culture 2011
The Minister of Culture and
National Heritage honoured
Bank Pekao S.A. with the title
Patron of Culture 2011. This distinction is granted annually to only one
company, for involvement in supporting and promoting culture and art.
The award of the Minister of Culture is of special importance as the Bank
was nominated by 21 cultural institutions from all over Poland. This is
agenuine source of pride and satisfaction for us.
Among projects that received support from the Bank were the most prestigious cultural events in Poland: International Festival Wratislavia Cantans
in Wrocaw, 20th Mozart Festival in Warsaw and 15th Shakespearian
Festival in Gdask.
In Poland, there is agreat number of cultural institutions and events that
are worth supporting. It is an important role to play for the Bank aleading financial institution, which prioritises supporting high culture within
its CSR strategy. The Banks commitment stems from astrong conviction
that patronage of culture is one of the most important duties of socially
responsible corporations. The Bank is guided by the objective of preserving the artistic heritage for future generations.
Bank Pekao S.A. has been involved in abroad range of events. For years,
it has been cooperating with numerous cultural institutions: renowned
theaters, museums, organisers of festivals and musical events. Since
2007, the Bank has funded awards granted by Polish PEN Club to writers,
publishing houses and translators. For four years, the Bank has been
the sponsor of the prestigious Paszporty POLITYKI poll, as part of which
awards are granted to outstanding young artists.
Bank Pekao S.A. among the Best
Employers in Poland
Bank Pekao S.A. once again received
the Top Employers certificate from
the international Corporate Research
26
Foundation, one of leading institutions assessing human resources management policies globally.
The Top Employers certificate is awarded to companies and organisations
whose employees have outstanding working conditions and development
prospects, and which meet standards of excellence in HR management,
as confirmed by CRFs research.
The certificate is granted on the basis of detailed research, which
includes the key areas of HR policies and practices, such as primary benefits, secondary benefits, working environment, training and development,
career development, and company culture.
In 2011, the label Top Employers was granted to 20 companies in Poland,
out of 360 organisations that qualified to take part in the project.
Bank Pekao S.A. scored the best results in the following areas: primary
benefits, training and development, and career development.
Promotional Emblem Teraz Polska for the
Pekao24 System
The electronic banking system Pekao24 was
awarded Promotional Emblem Teraz Polska in
the 21st edition of the competition for the best
products and services. The distinction attests to
the high quality and state-of-the-art status of
the services offered to Bank Pekao S.A.s clients
through e-channels.
Teraz Polska competition is organised by the Polish Promotional Emblem
Foundation under the auspices of the Polish President. The Emblem is
granted to single out products and services of the highest quality. It is one
of the most highly-valued awards in Poland. The competition has been
organised for 20 years.
Global Finance: Bank Pekao S.A. among Top
10 Safest Banks in CEE
Bank Pekao S.A. found its way to the TOP 10 list
of the safest banks in CEE. In the Worlds Safest
Banks 2011 ranking announced by the Global
Finance magazine in August 2011, it secured the
fourth position and won the first place among
Polish financial institutions.
The ranking winners were chosen on the basis of their long-term credit
ratings, assigned by leading rating agencies. The value of assets was also
taken into consideration.
The high position in the ranking confirms our solid capital position and
superior risk management capabilities.
Global Finance: Award for Corporate

Banking Services of Bank Pekao S.A.
For the fourth consecutive year, Bank
Pekao S.A. was awarded with two highprofile awards granted by the Global Finance
magazine:
Best Trade Finance Bank 2011,
Best Foreign Exchange Provider 2011
in the Polish zoty category.
Bank Pekao S.A. was the only Polish bank
recognised with the awards.
The title Best Foreign Exchange Provider 2011
is bestowed on outstanding institutions specializing in FX operations and effectively supporting
the activities of their clients.
Global Finance: PekaoBIZNES24 Named Best
Integrated Corporate Bank Site in CEE
The Bank received the title of Best Intergrated
Corporate Bank Site for its electronic banking
service PekaoBIZNES24, which was recognised
as the best integrated Internet banking platform
for corporate clients in CEE in the Worlds Best
Internet Banks 2011 contest, organised by the
international financial magazine Global Finance.
The international jury appreciated the Banks effective strategy for acquiring clients online and providing them with online services, the Banks
wide range of online banking products and services, and acomprehensive approach to corporate clients.
This was yet another prestigious distinction granted to the PekaoBIZNES24 system after the awards received in the previous years, including
the Europrodukt 2009, Zoty Bankier 2010 and Innovation of the Year
2010 titles.
Gold Emblem of Najwysza Jako Quality
International 2011 for Pekao Integrated
Agreement Packages for Corporate Clients
and for the Pekao24 system
The Bank was announced adouble winner
of the Najwysza Jako Quality International
2011 competition and received the Gold Emblem in the service category for its Pekao Integrated Agreement Packages for corporate clients and for its electronic banking service Pekao24
for individual clients.
the Banks products and services matching their individual needs and
use them effectively on the basis of simplified procedures, which fosters
building long-term relations with the Bank. Gold Emblem QI 2011 was yet
another distinction for Pekao Integrated Agreement, earlier awarded with
the Europrodukt 2009 title.
The Gold Emblem for the Pekao24 electronic
banking service for individual clients is atoken
of recognition for the Banks efforts to implement top quality electronic banking solutions
and develop the Internet service for clients
while ensuring the highest service standard in
other forms of contact with the Bank.
The Najwysza Jako Quality International competition is organised by
the editorial board of Forum Biznesu, asupplement to the Dziennik
Gazeta Prawna daily, under the auspices of the Ministry of Regional Development, Polish Agency for Enterprise Development and Polish Forum
ISO 9000. Its objective is to identify and award entities which distinguish
themselves through utmost care for the quality of their products and
services.
EUROPRODUKT Distinction for the Pekao24
Electronic Banking System
The electronic banking platform Pekao24 won
the EUROPRODUKT title in the 16th edition of
the competition held under the auspices of
the Ministry of Economy and Polish Agency
for Enterprise Development. The jury especially appreciated the modern,
intuitive and comprehensive nature of the service.
EUROPRODUKT is aprestigious nationwide competition held to single out
products and services which are able to compete on the European market
on account of their high quality, cutting-edge technology, interesting
offering and commitment to providing comprehensive and professional
services.
Mobile Trends Awards
The Banks mobile application Pekao24 was named the best application
in the mobile banking category in the first edition of the Mobile Trends
Awards competition. The competition winners were selected by ajudging
panel comprising IT and mobile technology experts.
The mobile application of Bank Pekao S.A. is amodern way of access to
aclients account and banking services through the Pekao24 electronic
banking platform. The application operates on all popular operating
systems of mobile phones and tablets, and the range of available services
is one of the most comprehensive among banking applications on the
Polish market.
The judging panel distinguished Pekao Integrated Agreement Packages for the comprehensive solutions which enable clients to choose
27
Important Events and Achievements (cont.)
Euromoney: Bank Pekao S.A.

as the Best Bank in Poland
in Transactional Banking
In the Euromoney magazines survey
clients chose Bank Pekao S.A. as the
Best Bank in Poland in 2011 in the area of the transactional banking
services. The award is another proof that Bank Pekao S.A. is strengthening its leading position in the Polish corporate banking sector.
The first place in the ranking of banks providing cash management services
in Poland shows that the Banks clients appreciate the highest quality and
innovative solutions, created for clients convenience, with care about the
highest standard of services and maximum transaction safety.
GPW: Bank Pekao S.A. as Treasury
BondSpot Market Leader
In February 2011, having reviewed the
activities of the participants of the Treasury
BondSpot Poland market in 2010, the Warsaw
Stock Exchange granted the title Treasury
BondSpot Poland Market Leader to Bank
Pekao S.A. Based on the registered turnover,
the Bank was acknowledged as an indisputable market leader, with an 11% share in trading. The participants of the
Treasury BondSpot market are 30 domestic and foreign banks.
The activity of the market participants was assessed globally and in the
following categories: turnover in the spot segment, turnover in the conditional transactions segment, and activity during fixing sessions.
The most significant honour for the Bank was the statuette of Treasury
BondSpot Poland Market Leader 2011, which Pekao won despite strong
competition from the other market participants. Apart from the first place
in the general ranking, Bank Pekao S.A. was ranked on second position in
the category Largest turnover in the conditional transactions segment of
the Treasury BondSpot Poland market in 2010.
Bank Pekao S.A. Named Bank of the Year
2011 in Commercial Real Estate Financing
Bank Pekao S.A. was named Financing Provider
of the Year Poland 2011 by the jury of the contest organised by the Eurobuild magazine one
of the most important professional magazines
of the commercial real estate sector in CEE.
The jury consisted of representatives of anumber of major companies from the commercial
real estate sector: real estate developers, project sponsors, consultants,
law firms, and banks. In the final of the contest, the Bank competed
against five other financial institutions.
28
Innovation of the Year 2011 Title for the

Loro Module for Correspondent Banks
The Loro Module for correspondent banks in
the PekaoBIZNES24 online banking platform
was distinguished as Innovation of the Year
2011 in the contest organised by Forum
Biznesu asupplement to the Dziennik Gazeta
Prawna daily. The jury appreciated the solution that integrates innovative
technology with asimple interface, and enjoys significant interest among
correspondent banks.
In comparison with the solutions offered by other banks, the Loro Module
stands out in terms of its extensive functionality and unique solutions,
including balance estimations calculated on demand, access to original
financial messages from all settlement systems, and acommunication
module, which enables transferring and recording authorised messages
to the Bank (inquiries and orders concerning financial transfers) and
archiving correspondence between the correspondent bank and Bank
Pekao S.A.
Innovation of the Year is acontest that promotes modern and original
solutions, products and services of companies, institutions and organisations operating in Poland in different industry sectors.
Bank Pekao S.A. as

National Sponsor of the UEFA European
Football Championship UEFA EURO 2012
and the Official Bank of
the Championship in Poland
On November 14th 2011, the Bank announced the signing of an agreement for sponsorship of the European Football Championship UEFA EURO
2012. Under the agreement, the Bank became the Official Bank of the
Championship in Poland as well as the National Sponsor. The agreement
defines the Banks rights as the National Sponsor and provides that the
Bank will conduct for the UEFA all banking transactions related to UEFA
EURO 2012 in Poland.
European Football Championship UEFA EURO 2012 is one of the two
largest events of this kind in Europe and the largest mass event in the
history of Poland. According to conservative estimates, it will attract
approximately half amillion football fans and tourists visiting Poland at
that time. The Bank has contributed to the event and has had an active
role in its organisation as it became akey strategic partner for financing
infrastructure projects related to UEFA EURO 2012, involving funds of
ca. PLN 4 billion.
The Bank provided funding and banking services for anumber of projects,
including:
construction of the stadium in Gdansk,
construction of the National Stadium in Warsaw,
modernisation of five regional airports,
modernisation of urban public transport,
construction of roads and highways for UEFA EURO 2012.
Appointment of Bank Pekao S.A. as the Official Bank of the European
Championship confirms its strong position and opens up new opportunities for business development and reinforcement of the Banks image as
an institution of public trust.
The Bank ensures comprehensive transactional support for the UEFA
EURO 2012 Championship, covering settlements with suppliers, handling ticket sales as well as supporting the sale of corporate packages.
Moreover, aspecial offer of new products has been developed, including
cards labelled with the UEFA EURO 2012 logo, dedicated savings
products, etc. Those products will be promoted by anumber of promotional campaigns, including contests in which the participants will have
achance to win free tickets for UEFA EURO 2012 matches.
29
The Banks Share Capital and Shareholding Structure
32
Performance of Market Valuation of Bank Pekao S.A.s Stock
33
Dividend Payment History
34
Investor Relations
34
Financial Credibility Ratings Assigned to Bank Pekao S.A.
35
Rating A for Mortgage Covered Bonds Issued by

Pekao Bank Hipoteczny S.A.
35
31

The Banks Share Capital
and Shareholding Structure
As at December 31st 2011, the share capital of Bank Pekao S.A. amounted to PLN 262,382,129 and was divided into 262,382,129 shares
of the following series:
137,650,000
7,690,000
10,630,632
9,777,571
373,644
621,411
515,472
359,840
94,763,559
Series
Series
Series
Series
Series
Series
Series
Series
Series
A
B
C
D
E
F
G
H
I
As at December 31st 2011, the share capital of the Bank amounted

to PLN 262,382,129 and did not change by the date of release of this
report. In 2011, the share capital of the Bank was increased by the total
amount of PLN 17,803 as aresult of the issue of 17,803 Series G ordinary bearer shares, which were taken up by participants of the Incentive
Programme implemented by the Bank Pekao Group.
bearer shares with apar value of PLN 1 per share

All the existing shares are ordinary bearer shares. There are no special
preferences or limitations connected with the shares, or differences in the
rights attached to them. The rights and obligations related to the shares
are defined by the provisions of the Polish Commercial Companies Code
and other applicable laws.
The shareholders of Bank Pekao S.A. holding directly or indirectly, through their subsidiaries, at least 5% of the total number of votes at the General
Meeting of Bank Pekao S.A. are as follows:
SHAREHOLDER
NUMBER OF SHARES AND

VOTES AT GENERAL MEETING
% OF SHARE CAPITAL AND TOTAL

VOTE AT GENERAL MEETING
DECEMBER 31ST 2011
UniCredit S.p.A.
Other shareholders
Total
155,433,755
106,948,374
262,382,129
UniCredit S.p.A. has been the Banks major shareholder since August
1999. As at December 31st 2011, UniCredit S.p.A. held 59.24% of the
Banks share capital and the same percentage of the total vote at its
General Meeting of Shareholders. The remaining shareholders interests
amounted to 40.76%. Since none of the remaining shareholders holds
more than 5% of the total vote at the Banks General Meeting of Shareholders, they are not required to disclose information on their holdings of
Bank Pekao S.A. shares.
On January 11th 2012, Aberdeen Asset Management PLC of Aberdeen
(acting for and on behalf of itself and its subsidiaries) acquired 215,000
shares of the Bank and exceeded 5% of the total number of voting rights
32
NUMBER OF SHARES AND

VOTES AT GENERAL MEETING
% OF SHARE CAPITAL AND TOTAL VOTE

AT GENERAL MEETING
DECEMBER 31ST 2010
59.24%
40.76%
100.00%
155,433,755
106,930,571
262,364,326
59.24%
40.76%
100.00%
at the General Meeting of Shareholders, as reported by the Bank in

the current report released on January 17th 2012 (current report
No. 3/2012). Currently, the investor holds 13,194,683 shares of the
Bank, representing the same number of voting rights and accounting
for 5.03% of all outstanding shares of the Bank and acorresponding
percentage of the total vote.
Polish open-end pension funds (OFE) constitute the group of financial
investors holding significant equity interests in the Bank. Based on their
publicly available financial statements, as at December 31st 2011 OFE
held in aggregate 11.8% of Bank Pekao S.A. shares.
Polish open-end pension funds holdings in Bank Pekao S.A.:

NUMBER OF SHARES
AND VOTES AT
GENERAL MEETING
SHAREHOLDER
Aviva OFE Aviva BZ WBK

ING OFE
OFE PZU Zota Jesie
Amplico OFE
AXA OFE
Generali OFE
Aegon OFE
Nordea OFE
PKO BP Bankowy OFE
Allianz Polska OFE
OFE Pocztylion
OFE Warta
OFE Polsat
Total
NUMBER OF SHARES
AND VOTES AT
GENERAL MEETING
% OF SHARE CAPITAL
AND TOTAL VOTE AT
GENERAL MEETING
DECEMBER 31ST 2011
7,409,785
5,216,783
4,859,005
2,928,048
2,564,607
1,737,638
1,514,571
1,429,360
1,123,915
967,384
505,271
410,063
194,150
30,860,580
% OF SHARE CAPITAL
AND TOTAL VOTE AT
GENERAL MEETING
DECEMBER 31ST 2010
2.82%
1.99%
1.85%
1.12%
0.98%
0.66%
0.58%
0.54%
0.43%
0.37%
0.19%
0.16%
0.07%
11.76%
7,286,512
7,007,925
4,848,129
2,694,960
2,284,347
1,739,058
1,360,182
1,426,725
909,599
973,783
786,198
506,093
149,116
31,972,627
2.78%
2.67%
1.85%
1.03%
0.87%
0.66%
0.52%
0.54%
0.35%
0.37%
0.30%
0.19%
0.06%
12.19%
Source: Prospectuses and annual reports published by the open-end pension funds; closing share price of Bank Pekao S.A. as at the end of period.
Performance of Market Valuation of

Bank Pekao S.A.s Stock
Performance of Bank Pekao S.A.s stock in 2011:

Bank Pekao S.A.
The Banks market capitalisation as at December 31st 2011 amounted

to PLN 37.05 billion and was by 21.1% lower in comparison with the
previous year. Given the high capitalisation and liquidity, the Banks
shares are part of many important stock indices maintained by
domestic and foreign institutions, including the Polish blue chip index
WIG20.
With the average daily trading volume at the level of 504 thousand and
the worth of trading at PLN 19.6 billion in 2011, the share of the Bank
stock in trading on the WSE amounted to 7.78%.
0.1
0.05
0
-0.05
-0.1
-0.15
-0.2
-0.25
-0.3
-0.35
31
.1
2
21 .20
.0 10
1.
10 20
.0 11
2
02 .20
.0 11
3
22 .20
.0 11
3
11 .20
.0 11
4
04 .20
.0 11
5
24 .20
.0 11
5
13 .20
.0 11
6
04 .20
.0 11
7
22 .20
.0 11
7
11 .20
.0 11
8
01 .20
.0 11
9
21 .20
.0 11
9
11 .20
.1 11
0
31 .20
.1 11
0
22 .20
.1 11
1
12 .20
.1 11
2.
20
11
The shares of Bank Pekao S.A. are one of the most liquid equities in
Poland and Central and Eastern Europe.
Bank Pekao S.A.

WIG Banki
The Banks stock price decreased by 21.1% in 2011 (from

PLN 179.0 as at December 31st 2010 to PLN 141.2 as at December
31st 2011), in line with the performance of the WIG20 index, which
went down by 21.9% over the period.
WIG 20
Source: WSE.
Over the year the price fluctuated in the range from PLN 115.1 to
PLN 184.5. This volatility was mainly driven by the sentiment prevailing on global markets. The CEE region was one of the weakest among
emerging markets and the banking sector was one of the least popular
among investors.
33
Information for Investors (cont.)
Market valuation of Bank Pekao S.A. in 2011:
P/BV
P/E
2.4
20
19
18
17
16
15
14
13
12
11
10
9
8
7
2.2
2
1.8
1.6
1.4
1.2
.1
2
21 .20
.0 10
1
10 .20
.0 11
2
02 .20
.0 11
3
22 .20
.0 11
3
11 .20
.0 11
4
04 .20
.0 11
5
24 .20
.0 11
5
13 .20
.0 11
6
04 .20
.0 11
7
22 .20
.0 11
7
11 .20
.0 11
8
01 .20
.0 11
9
21 .20
.0 11
9
11 .20
.1 11
0
31 .20
.1 11
0
22 .20
.1 11
1
12 .20
.1 11
2.
20
11
31
31
.1
2
21 .201
.0
1 0
10 .201
.0
2 1
02 .201
.0
3 1
22 .201
.0
3 1
11 .201
.0
4 1
04 .201
.0
5 1
24 .201
.0
5 1
13 .201
.0
6 1
04 .201
.0
7 1
22 .201
.0
7 1
11 .201
.0
8 1
01 .201
.0
9 1
21 .201
.0
9 1
11 .201
.1
0 1
31 .201
.1
0 1
22 .201
.1
1 1
12 .201
.1
2. 1
20
11
Bank Pekao S.A.
Bank Pekao S.A.
Avg Sector P/BV MF
Avg Sector P/E MF
Source: Bloomberg; average for the sector calculated based on 9 largest Polish banks listed
on the WSE.
Source: Bloomberg; average for the sector calculated based on 9 largest Polish banks listed
on the WSE.
Bank Pekao S.A. maintained its market premium in comparison with

the average for the Polish banking sector. As at December 31st 2011,
the Banks P/BV and P/E ratios were 1.8 and 13.4 respectively.
Dividend Payment History

In 2011, the Bank paid out dividend for 2010 in the amount of PLN 6.8
per share. Dividend yield was 4.8%.
The dividend payments in the period from 2002 to 2010 are presented
below:
DATE
2002
2003
2004
2005
2006
2007
2008
2009
2010
Dividend for the year (PLN million)

Dividend per 1 share (PLN)
693
4.18
748
4.50
1,065
6.40
1,234
7.40
1,504
9.00
2,517
9.60
761
2.90
1,785
6.80
Investor Relations
The Banks activity in the investor relations area is focused on providing
transparent and active communication with the market through active
cooperation with investors, analysts and rating agencies as well as complying with disclosure requirements under applicable laws.
The Banks representatives regularly hold alot of meetings with investors
in Poland and abroad, they take part in most of the regional and industry
dedicated investor conferences and answer inquiries of the market. Each
quarter the Groups financial results are presented at conferences which
are webcast over the Internet. In 2011, there were four conferences held
to present the Banks financial performance and over 500 meetings with
investors and analysts from ca. 300 investment firms.
34
The key goal of the Banks investor relations activities is to enable the
market to make informed evaluation of the Banks financial standing, its
market position and business model effectiveness against the backdrop
of the banking sector condition and the macroeconomic situation in the
national economy and on international markets.
All material investor information is available on the Banks website:
http://www.pekao.com.pl/information_for_investors/.
Financial Credibility Ratings Assigned

to Bank Pekao S.A.
Bank Pekao S.A. is rated by three leading agencies: Fitch Ratings,
Standard and Poors, and Moodys Investors Service. In the case of the
first two, the ratings are provided on asolicited basis under relevant
agreements, and with respect to Moodys Investors Service, the ratings
are unsolicited and are based on publicly available information and review
meetings.
The Banks ratings in 2011 proved to be strongly resilient to the changes
taking place on financial markets and were maintained at ahigh level.
As at December 31st 2011, Bank Pekao S.A.s credit ratings were as
follows:
fitch ratings
Bank pekao s.a.
POLAND
Long-term rating (IDR)

Short-term rating
Individual rating*
Viability rating**
Support rating
Outlook
AF2
B/C
a2
Stable
AF2
Stable
STANDARD AND POORs
BANK PEKAO S.A.
POLAND
Long-term rating
Short-term rating
Stand-alone credit profile
Outlook
AA-2
bbb+
Watch****
AA-2
bbb-***
Stable
MOODYs INVESTORS SERVICE LTD.

(UNSOLICITED RATING)
BANK PEKAO S.A.
POLAND
Long-term foreign-currency
deposit rating
A2
A2
Short-term deposit rating

Financial strength
Prime-1
C-
Prime-1
Watch****
Stable/
Negative*****
Outlook
*
**
On January 25th 2012, Fitch Ratings withdrew the individual rating category.
On July 20th 2011, Fitch Ratings added the viability rating to the ratings of all financial
institutions they cover. The viability rating, just like the abandoned individual rating,
represents assessment of the quality of afinancial institution management, determining
its intrinsic creditworthiness. The rating is assigned on the familiar 19-point long-term
rating scale, starting from aaa as the highest to f as the lowest, with the possibility
of adding + or -. The individual rating and the viability rating were maintained on
aparallel basis in 2011.
*** Banking Industry Country Risk Assessment (BICRA).
**** Rating Watch Negative indication.
***** Stable for Poland and Negative for the Polish banking sector.
Bank Pekao S.A. has the highest individual rating and viability rating assigned by Fitch Ratings to Polish banks.
On February 14th 2012, Standard & Poors rating agency (Standard
& Poors) confirmed the Banks short-term rating at the level A-2 and
the stand-alone rating at the level bbb+, the highest rating assigned by
Standard & Poors to aPolish bank. The outlook for the ratings was upgraded from negative to stable. The long-term rating of the Bank was
downgraded by one notch from A- to BBB+ following prior downgrading of the Republic of Italys ratings, and in consequence the downgrade
of the rating of the Banks parent company, UniCredit S.p.A.
As aresult, the Banks ratings assigned by Standard & Poors are as follows: long-term credit rating BBB+, short-term rating A-2, outlook
stable, and stand-alone rating bbb+.
Rating A for Mortgage Covered Bonds

Issued by Pekao Bank Hipoteczny S.A.
Fitch Ratings assigned the A rating to mortgage covered bonds issued
by Pekao Bank Hipoteczny S.A., a100% subsidiary of Bank Pekao S.A.
It was the highest rating ever awarded to Polish debt securities issued
by aprivate company. The reasons underlying the agencys decision
included the high rating assigned to Pekao Bank Hipoteczny S.A. (A-),
legal regulations pertaining to the covered bonds security register, and
the excess of security over the volume of covered bonds in issue, as
declared by the bank. The high rating assigned to the mortgage covered
bonds confirms Pekao Bank Hipotecznys ability to issue securities offering ahigh level of security and raise long-term capital to fund its lending
activity.
On October 4th 2011, Fitch Ratings confirmed the A rating assigned
in 2010 to mortgage covered bonds issued by Pekao Bank Hipoteczny
S.A. On November 24th 2011, Fitch Ratings also confirmed the rating
assigned to Pekao Bank Hipoteczny S.A. at the level A-.
35
Financing the excitement

of UEFA EURO 2012
Bank Pekao participated in the financing of three UEFA EURO 2012 stadiums: the National Stadium
in Warsaw and the stadiums in Pozna and Gdask. In terms of architectural design, the stadium in
Gdask is considered one of the most impressive structures erected for the UEFA European Football
Championship. Bank Pekao has also financed other infrastructure projects implemented in connection
with UEFA EURO 2012, including highways, regional airports and public transport. As the official
slogan states Simple emotions are sometimes not enough, Bank Pekao has really become part of
UEFA EURO 2012 as the National Sponsor.

Important Factors that Influenced
the Groups Activity and Performance
38
Major Sources of Risks and Threats

Risk Management
Credit Risk
Liquidity and Market Risks
Business Risk
Real Estate Risk
Financial Investment Risk
Operational Risk
Compliance Risk
38
38
39
39
41
41
41
41
42
New Capital Accord Basel II
43
Capital Adequacy
44
Bank Pekao S.A. on the Polish Banking Market

Individual Clients
Small-Sized and Micro Enterprises
Corporate Clients
45
45
49
50
Major Areas of the Groups Activities

Banking Activity
Asset Management
Leasing Activity
Other Financial Services
53
53
54
54
54
37

Important Factors that Influenced
the Groups Activity and Performance
The economic climate in Poland and developments in the Polish banking
sector, as well as trends prevailing in the global economy, had amaterial
effect on the Groups operations in 2011.
The favourable economic situation contributed to asignificantly improved

quality of assets in the corporate segment and stabilisation in the retail
segment.
Major Sources of Risk and Threats

Risk Management
Polands economy continued to grow and was one of the fastest developing economies in Europe. The GDP growth rate accelerated in relation
to 2010 and reached 4.3%. The key drivers of the economic growth
included private consumption and gross capital investment. Investments
increased significantly on the back of higher capacity utilisation and
completion of investment projects that had been postponed in previous
years, including primarily the EURO 2012 infrastructural projects and
residential projects.
As regards foreign trade, ahigher turnover and an increase in net exports
were recorded. Depreciation of the Polish zoty benefited exporters, giving competitive advantage to their products. Retail sales and industrial
production were on the rise as well. In the first half of the year, good conditions prevailed on the labour market, particularly in the corporate sector,
which saw higher staffing levels and pay rises, however, the upward trend
gradually slowed down in the second half of the year. Fiscal problems of
some euro-zone members did not stifle growth in the Polish economy.
The above economic processes supported further development of the Polish banking sector, which recorded higher growth in lending and deposits.
The sectors asset quality was gradually improving, which resulted in
alower rate of non-performing loans.
Despite gradual tightening of lending conditions by the Polish Financial
Supervision Authority (Recommendation T, amended Recommendation S),
mortgage loan sales remained at record-high levels for the first eight
months of 2011. In the following months, the sales growth rate clearly
decreased due to limitation of the governmental housing loan programme
Family in Their Own Home and phased implementation of the above
mentioned stricter lending conditions introduced by the Polish Financial
Supervision Authority,, but it still remained strong.
The ongoing economic recovery and implementation of infrastructural
projects fuelled the demand for corporate loans, including both working
capital and investment loans, which translated into asignificant acceleration of the sales volume growth.
Good economic conditions were also conducive to amajor increase in
individual and corporate savings.
Driven by concerns about the effects of the continuing inflationary pressure, the Monetary Policy Council raised interest rates four times, each
time by 0.25 pp.
38
Effective risk management is aprerequisite for maintaining ahigh level of

security of the funds entrusted to the Bank, and for achieving asustainable and balanced profit growth.
The key risks inherent in the Groups financial instruments include credit
risk, liquidity risk, market risk (interest rate risk, currency risk), business
risk, real estate risk and financial investment risk. asignificant element of
the risk management system is also operational risk.
The Bank has adopted acomprehensive and consolidated approach to
risk management. It extends to all units of the Bank and its subsidiaries.
Risks are monitored and controlled with respect to profitability and the
funds necessary to cover the exposure.
The Management Board is responsible for achieving the strategic risk
management goals, while the Supervisory Board oversees whether the
Banks policy of exposure to various types of risk is compliant with the
overall strategy and financial plan.
The Banks Credit Committee plays an important role in the credit risk
management, the Asset, Liability and Risk Committee in market and
liquidity risk management, and management of the operational risk falls
within the scope of responsibility of the Operational Risk Committee.
The rules of managing each of the risks are defined in internal procedures and are subject to the assumptions of the credit and investment
policies adopted annually by the Management Board and approved by the
Supervisory Board. The rules of managing operational risk are determined
by the objectives specified in the operational risk management strategy
and operational risk management procedures.
The Management Board, the Audit Committee and the Supervisory Board
are provided with detailed reports on credit and market risk exposures.
The rules and instruments applied to manage each of the risks are
described below.
Information on risk exposures is included in Notes to the Consolidated
Financial Statements of the Bank Pekao S.A. Group for the year ended
December 31st 2011.
Credit Risk
Managing credit risk and maintaining it at asafe level is vital for the
Banks financial performance. In order to minimise credit risk, special
procedures have been established, pertaining in particular to the rules of
assessing transaction risk, collateralisation of loan and lease receivables,
credit decision powers, and restrictions on lending to certain types of
businesses.
Lending activities are subject to limits following both from the Banking
Law and the Banks internal standards, including limits concerning
exposure concentration ratios for individual sectors of the economy,
limit on the share of large exposures in the Banks loan portfolio, and
limits of exposures to countries, foreign banks and domestic financial
institutions.
The credit decision powers, lending restrictions as well as internal and
external prudential standards, pertain to loans and guarantees as well
as derivative transactions and debt instruments. The quality of the loan
portfolio is also protected by periodic reviews and ongoing monitoring of
the timely servicing of loans and the financial standing of customers.
Under the guidelines of UniCredit, the Bank has continued to work on
further rationalisation of the credit process with aview to improving its
efficiency and security. These efforts include in particular refinement of
the procedures and tools for risk measurement and monitoring.
Credit Risk Concentration Limits
In accordance with the Banking Law, abanks total exposure to asingle
borrower or agroup of borrowers related by capital or organisational
structure may not exceed 25% of abanks equity.
In 2011, the maximum exposure limits set forth in the Banking Law were
not exceeded.
Sector Exposure Concentration
In order to mitigate credit risk associated with excessive sector concentration, the Bank has asystem in place which allows it to control
the sector structure of its credit exposure. The system involves setting
concentration ratios for particular sectors, monitoring the loan portfolio,
and information exchange procedures. The system supports the management of exposures to individual business areas classified in accordance
with the Polish Classification of Business Activities (Polska Klasyfikacja
Dziaalnoci PKD).
Concentration ratios are determined on the basis of the Banks current
exposure to aparticular sector and risk assessment of the sector.
Periodic comparison of the Banks exposures with the applicable concentration ratios allows for timely identification of the sectors where an
excessive risk concentration might occur. If such concentration occurs,
the Bank analyses the sectors economic situation (both existing and
forecast trends) as well as the quality of the current exposure to the
sector. Based on these measures, the Banks policy of mitigating sector

risk is defined and adjusted to the changing environment.
Rules of Procedure for Exposures
to Residential Mortgage Secured Loans
Bank Pekao S.A. has documented rules of procedure for exposures to
residential mortgage secured loans to be followed in the event of material
adverse changes on the real estate market or negative macroeconomic
developments. On the basis of the rules, the Bank can react promptly to
such developments on the real estate market in Poland.
Credit Risk Management at Subsidiaries Based
outside the Republic of Poland
The process of credit risk management at PJSC UniCredit Bank is consistent with the Credit Policy of the Bank Pekao S.A. Group and reflects
the requirements of the local Ukrainian market. Since 2003, the credit
policy has been annually adopted by the statutory bodies of PJSC
UniCredit Bank and issued in the form of internal regulations to be followed at PJSC UniCredit Bank.
Bank Pekao S.A. exercises strict supervision and control over the underwriting process at PJSC UniCredit Bank. All credit decisions are taken by
the Management Board of PJSC UniCredit Bank, however for credits or
total exposures above EUR 5 million (or its equivalent in other currencies),
they require aformal approval by Bank Pekao S.A. The credit underwriting
scheme is compliant with the standards of credit risk management that
are currently in force at Bank Pekao S.A.
The majority of the loan portfolio are loans to corporate clients, which
include the largest companies in Ukraine. Corporate lending activity is
driven by working capital loans and investment loans.
Liquidity and Market Risks

The management of liquidity and market risks is avital element of the
Groups asset and liability management policy. Its primary objective is
to optimise the structure of assets and liabilities and off-balance sheet
items, taking into account the assumed relation of risk to income and
acomprehensive approach to all types of risk taken by the Group in its
business activities. The risks are monitored and controlled in relation
to profitability and funds necessary to cover the exposure, and relevant
reports are prepared on aregular basis.
The Asset, Liability and Risk Committee supports the Management
Board with advice and recommends the appropriate steps to be taken
to ensure proper implementation of the Management Boards policy.
The Asset, Liability and Risk Committee is responsible, among other
things, for management of the structural risk relating to the Groups
statement of financial position (which results from amismatch between
assets and liabilities in terms of liquidity, exchange rates and interest
rates), management of market and liquidity risks relating to investment
portfolios, as well as management of Pillar 2 (Basel II) risks.
39
Activities of the Bank Pekao S.A. Group (cont.)
The Asset, Liability and Risk Committee decides on the process of

assets and liabilities management, interest rate management and
investment policy, and it monitors the compliance of the risk exposures
with internal and regulatory limits.
The Asset, Liability and Risk Committee monitors and controls the capital
adequacy and exposure to liquidity and market risks against external
limits imposed by supervisory authorities and internal limits adopted by
the Group.
Liquidity Risk
The overall objective of liquidity risk management is to ensure and maintain the Groups ability to meet its current and future planned obligations,
taking into account the cost of liquidity, to avoid crisis situations, and to
define contingency solutions to be employed in the event of acrisis.
The Group invests free cash primarily in treasury securities issued by the
Polish government, which are highly liquid instruments. As they can be
instantly sold or pledged, they constitute aregularly monitored liquidity reserve for the Group, which should allow the Group to overcome potential
crisis situations.
The Banks short-term (operational) liquidity, including transactions executed on financial markets and the available amount of liquid securities
(securities which are marketable or eligible as collateral when borrowing from central banks), is monitored on adaily basis. Additionally, the
structural liquidity, encompassing the whole time horizon of the Banks
balance sheet, including its long-term liquidity, is monitored on amonthly
basis.
The Banks liquidity is managed by monitoring, setting the limits on,
controlling and reporting to the Banks management anumber of
liquidity indicators, calculated for both the Polish zoty and the main
foreign currencies, as well as on an aggregate basis. In accordance
with the relevant recommendations by financial supervision authorities, the Group has introduced internal liquidity indicators, defined as
the ratios of adjusted maturing assets to adjusted maturing liabilities
of up to one month and up to one year. The Group has also introduced
coverage ratios, comprising ratios of adjusted maturing liabilities to
adjusted maturing assets over one, two, three, four and five years for:
the total balance, the total balance of foreign currencies, and balances
of individual currencies.
The Group has contingency procedures in place, protecting it in the event
of any substantial deterioration in its financial liquidity or in the event of
an increase in the liquidity risk on the market. The contingency plan to be
employed in the event of deterioration in the Groups liquidity involves daily monitoring of certain early-warning indicators, capturing both systemic
and Group-specific risks, and provides for four levels of liquidity risk,
depending on the level of early-warning indicators, the Groups standing
as well as overall market situation. Additionally, the policy defines the
sources of funds to be used to cover an expected cash outflow, as well
40
as the procedures for monitoring the liquidity levels, the procedures for
emergency measures, the organisational structures of taskforces charged
with restoring the Groups liquidity, and the scope of the Management
Boards responsibility for making decisions necessary to restore the
required liquidity level.
An integral part of the liquidity monitoring process at Bank Pekao S.A.
for situations relating to afinancial market crisis or acrisis triggered by
internal factors that are specific to the Bank, is the stress test scenario
analysis, conducted on aweekly and monthly basis.
Pursuant to the Polish Financial Supervision Authoritys Resolution
No. 386/2008 on fixing liquidity norms for banks, since January 2008
the Bank has calculated regulatory liquidity measures on adaily basis.
In 2011, the Banks regulatory liquidity measures were above the
required levels.
Market Risk
In its activities, the Group is exposed to market risk resulting from
changes in market factors.
Market risk is the risk that the Groups net profit or economic capital
will decrease due to changes in market conditions. The key market risk
factors are: interest rates, exchange rates, equity prices and commodity
prices.
In connection with its exposure to market risk, the Group operates
amarket risk management system, which provides an organisational
and methodological procedural framework designed to ensure that the
structure of the statement of financial position and off-balance-sheet
items is in agreement with the strategic goals. The main objective
behind the market risk management strategy is to optimise the financial results and the impact on the economic value of capital so that
financial targets of the Group are attained and provision of high-quality
services to the Groups clients is ensured while the exposure to market
risk remains within the limits approved by the Management and Supervisory Boards.
The market risk management process is based on athree-tier control
system, which conforms to international best banking practice and
recommendations issued by the regulators. The market risk management
process and procedures reflect the division into the trading book and the
banking book.
Trading Book Market Risk
In the process of trading book market risk management the Group seeks
to optimise its financial results as well as the quality of customer service
while complying with the limits approved by the Management Board and
The key tool for assessing the market risk of the trading book is the
Value at Risk (VaR) model. VaR represents the value of aone-day loss
that might be realised with aprobability not exceeding 1%. VaR is

determined using the historical simulation method based on two years
observation of the dynamics of market risk factors. The model is subject
to statistical verification on an ongoing basis, which involves comparing
the VaR amount with the actual and revaluation results. The analyses
for 2011 and 2010 have confirmed the models adequacy.
Sensitivity measures, ongoing monitoring of the economic performance,
and stress tests are additional tools for measuring the trading book
market risk.
Banking Book Interest Rate Risk
In managing the banking book interest rate risk, the Group aims to maximise the economic value of capital and achieve the target net interest
income while complying with the accepted limits. The financial position of
the Group in relation to changing interest rates is monitored through the
interest rate gap (revaluation gap) methodology, VaR analysis, duration
analysis, simulation analyses and stress testing.
Currency Risk
The currency risk is managed jointly for the trading and banking books.
The objective of currency risk management is to create acurrency profile
of assets and liabilities and off-balance sheet items which will remain
within external and internal limits. The Groups exposure to currency risk
is measured for internal purposes on adaily basis by means of the Value
at Risk (VaR) model as well as stress testing analysis, which is supplementary to the VaR method.
Financial Investment Risk

Financial investment risk stems from the Groups banking book equity
holdings.
Financial investment risk is assessed based on the Value at Risk method
in one-year time horizon and at the assumed confidence level of 99.97%.
Operational Risk
Operational risk is the risk of loss due to mistakes, infringements, interruptions or damage caused by internal processes, people, systems or
external events. Operational risk includes also legal risk. Strategic risk,
business risk and reputation risk are different from operational risk.
Operational risk management is based on internal procedures which are
in compliance with the Banking Law, the Polish Financial Supervision
Authoritys Resolutions No. 76/2010 (as amended) and No. 258/2011,
Recommendation M and the UniCredit Groups standards. Operational
risk management encompasses: identification and assessment, monitoring, mitigation and reporting. Identification and assessment are carried
out by means of internal and external data analysis, scenario analysis,
operational risk indicators and operational risk self-assessment. Monitoring activities are carried out at three control levels: operational control
(all employees), risk management control (Operational Risk Management
Department) and internal audit (Internal Audit Department). Operational
risk mitigation involves the internal control system, mitigation measures,
business continuity plans, and also insurance policies.
Business Risk
Business risk is defined as unexpected adverse changes in business
volumes and/or margins that are not due to credit, market or operational
risks.
When calculating its business risk exposure the Bank employs the Earnings at Risk (EaR) concept, which makes it possible to assess the risk of
an unexpected negative deviation in the realised financial result from the
target level assumed in the financial plan. EaR is assessed in one-year
time horizon at 99.97% confidence level.
Real Estate Risk

Real estate risk results from volatility of the market value of real estate
owned by the Group. The risk does not cover real estate held as collateral
for loans granted.
Real estate risk is calculated in one-year time horizon using the Value
at Risk model at 99.97% confidence level and the standard method of
determining capital requirements as stated in Pillar 1 of Basel II.
Organisational Structure
The Supervisory Board approves the operational risk management
strategy of the Bank, which defines operational risk, principles of operational risk management, and the internal control system with regard to
operational risk. The Supervisory Board is also responsible for supervision
of the operational risk management system control and evaluation of its
adequacy and effectiveness, which includes reviewing annual reports on
operational risk control.
The Management Board is in charge of preparation, implementation and
operation of an adequate operational risk management process by means
of introducing appropriate regulations. Moreover, the Management Board
is responsible for the effectiveness of the operational risk management
system, internal control system and the capital requirement calculation
process as well as for supervision over the effectiveness of those processes. It makes the required corrections or improvements in the event of
achange in the Banks risk exposure or in the economic environment, or
if irregularities are identified in the operation of systems and processes.
The Operational Risk Committee supports the Management Board in
creating an adequate operational risk management process through
the application of principles included in the strategy of operational risk
management. The Operational Risk Committee is responsible for the
41
monitoring of the Groups operational risk, assessment of the operational

risk management strategy, guidelines, policies, procedures and instructions as well as the operational risk measurement model, assessment of
reports on the validation of the operational risk management system and
other materials on operational risk, assessment of proposed operational
risk limits and approval of the list of key risk indicators and relevant limits.
Capital Requirement and Allocation Mechanism

In the first half of 2011, Bank Pekao S.A. received from Italian and Polish
regulators adecision concerning permission to apply the Advanced Measurement Approach (AMA) for the purpose of calculating the operational
risk capital requirement at the consolidated and stand-alone level, in the
part related to Bank Pekao S.A.
The Operational Risk Management Department monitors the operational

risk exposure of the Bank and of its subsidiaries. Its responsibilities
include organisation of the process of collecting and recording operational
events in the operational risk database, monitoring of key risk indicators,
assessment of scenario analyses, cooperation in the analysis of the operational risk impact if new products are introduced or important changes
are made to the Banks business or its organisational structure, verifying
whether the Banks business continuity plans are regularly updated and
tested, monitoring mitigation measures and controlling outsourcing risk
management.
The AMA method is based on internal loss data, external loss data,
scenario analysis as well as key risk indicators. The calculated overall
AMA capital requirement is allocated to the UniCredit Group entities.
The capital requirement allocated by means of the allocation mechanism
reflects each entitys risk profile.
In connection with the abovementioned decision, the Bank applied its
provisions to the calculation of the operational risk capital requirement as
at December 31st 2011.
Compliance Risk
Reporting
A reporting system has been developed to inform senior management
and relevant control bodies about the Banks exposure to operational risk
and risk mitigation measures. In particular, annual and quarterly operational risk reports include data concerning operational losses, key operational risk indicators, significant operational events, amount of the capital
requirement, key mitigation measures, current trends relating to fraud
and credit risk linked events (cross-credit losses). The annual reports
are presented to the Operational Risk Committee and the Management
Board, and next they are submitted to the Supervisory Board, whereas the
quarterly reports are presented to the Operational Risk Committee and
the Management Board.
Reports on key risk indicators monitoring are prepared each month and
are distributed to the Operational Risk Coordinators, i.e. employees who
are responsible for operational risk coordination in individual divisions.
The results of the scenario analyses are presented to the Operational Risk
Committee and the Management Board. Moreover, weekly information on
significant internal and external operational events is distributed to the
Operational Risk Coordinators.
Local Validation Process
Validation of the operational risk management system is performed
once ayear and its aim is to examine compliance of the system with the
regulatory requirements and the UniCredit Groups standards. The local
validation bases on self-assessment of the operational risk management
and control system by the Operational Risk Management Department. Results of the self-assessment are presented in the Local Validation Report.
Local validation is independently reviewed by the UniCredit Group Internal
Validation Department. Next, local validation and results of the independent review are audited by the Internal Audit Department. Validation of the
operational risk management and control system at Bank Pekao S.A. is
approved by the Management Board.
42
The purpose of the compliance risk management is to ensure that the

activities of the Bank and its employees comply with the applicable
norms, including in particular provisions of law, the Banks internal regulations, recommendations issued by supervisory and control bodies, best
practices and ethical standards as well as the standards of the UniCredit
Group.
Compliance risk management applies to anumber of areas, including
banking, financial and investment services. Implementation and application of the compliance risk management standards are key factors in creating enterprise value, reinforcing and protecting the Banks reputation,
and fostering public trust in the Banks activities and its standing.
The responsibility for co-ordination of the Banks activities in the scope
of compliance risk management lies with the Compliance Department.
The tasks of the Department include in particular monitoring, identifying,
eliminating and preventing the compliance risk.
The Bank uses the CAMP methodology for compliance risk assessment.
The methodology enables assessment of the Banks existing procedures
and processes in terms of their compliance with the key legal requirements concerning banking business, identified on the basis of generally
applicable regulations. In line with the methodology, which operates as an
early-warning system, mitigation measures are promptly implemented in
case of detecting irregularities. All the Banks divisions are involved in the
process and thus afull transparency of business and control processes
is maintained, enabling efficient monitoring of all key areas of the Banks
activity.
The assessment of compliance risk contributes to improvement of the
internal control system at the Bank and therefore tominimisation of the
compliance risk involved in the Banks operations.
New Capital Accord

Basel II
Bank Pekao S.A. has applied the Basel II guidelines developed by the
Basel Committee for the purpose of computing its capital adequacy
requirements and capital adequacy ratio since 2008. The guidelines were introduced in EU Member States by virtue of Directives
2006/48/EC relating to the taking up and pursuit of the business of
credit institutions and 2006/49/EC on the capital adequacy of investment firms and credit institutions, and in the Republic of Poland by
virtue of Resolution No. 1 of the Banking Supervision Commission
dated March 13th 2007, and subsequent regulations issued by the
Polish financial supervisory authorities.
Given regulatory requirements and the strategic nature of the
changes to risk management and the methods of estimating the
Banks regulatory and economic capital following from the New Capital Accord, responsibility for the direct supervision over compliance
with the New Capital Accords requirements rests with the Banks
Management Board. The Board is periodically informed of all new
projects connected with the implementation of the New Capital Accord and their results. The Management Boards opinions on issues
related to the introduction of changes resulting from the implementation of the New Capital Accord are submitted to the Supervisory
Board for approval.
for credit risk supports running in parallel the Standardised and the
Advanced Approach, its efficiency is adequate, and its high effectiveness ensures the processing of 99.997% of the credit transactions
volume each month. Presently, the Bank is working, in cooperation
with the system provider and the consulting firm, on the alignment of
the IT system as well as other systems with the requirements of the
Advanced IRB Approach.
The general implementation framework of the capital adequacy
system, including the chief elements of the Banks internal capital
management, the organisational structure, and the scopes of responsibility for the process, has been adopted by the Management Board
and subsequently approved by the Supervisory Board. The Banks
detailed internal procedures concerning estimation of regulatory and
internal capital, capital management, and capital planning were also
approved.
Completion of the abovementioned tasks means that the Bank was
effectively in compliance with the supervisory authorities regulations
introducing Basel II requirements set by the Basel Committee on
Banking Supervision.
The Master Plan for the implementation of the New Capital Accord,
drafted and approved in 2005, assumes alignment of the Banks
operations with all three Pillars of the New Capital Accord, i.e. Pillar
1 (Minimum Capital Requirements), Pillar 2 (Supervisory Review), and
Pillar 3 (Market Discipline).
In accordance with the adopted schedule, Bank Pekao S.A. computes
capital adequacy requirements for credit risk purposes under the
Standardised Approach and for operational risk purposes under
Advanced Measurement Approach, remaining fully compliant with
Pillar 1 requirements. In 2008, it also prepared, approved and implemented the Internal Capital Adequacy Assessment Process the
basic constituent of Pillar 2. The disclosure requirements under Pillar
3 were met.
The Master Plan was prepared in close cooperation with banking
supervisory authorities and under specific guidelines of the UniCredit
Group. The Plan constitutes an integral part of the UniCredit Groups
scheme for phased implementation of the Advanced Approach.
The process of achieving compliance with the New Capital Accord
also involves meeting stringent organisational and IT requirements. Throughout the process, the Bank is supported by areputable consulting firm and the IT system provider. The KRM system
(Kamakura Risk Management) for the calculation of capital charge
43

Capital Adequacy
A basic measure of capital adequacy is the capital adequacy ratio (CAR).
The minimum capital adequacy ratio required by law is 8%. At the end of
December 2011, CAR for the Group amounted to 16.98%, which is more
than double the minimum value required by the law.
The table below presents the basic data concerning the Groups capital adequacy as at December 31st 2011 and December 31st 2010.
(PLN thousand)
CAPITAL REQUIREMENT
31.12.2011
31.12.2010
Credit risk
Exceeding exposure concentration limit and large exposure limit
Market risk
Settlement and counterparty risk
Exceeding capital concentration limit
Operational risk
Total capital requirement
7,016,931
0
170,415
125,811
0
963,353
8,276,510
6,311,133
0
135,914
87,560
0
1,105,794
7,640,401
17,570,913
0
17,570,913
16,819,902
0
16,819,902
16.98%
17.61%
Capital for capital adequacy ratio calculation

Tier 1 capital
Tier 2 capital
Capital for capital adequacy ratio calculation
Capital adequacy ratio (%)
The capital requirements calculation is based on the applicable regulations of supervisory authorities.
The capital adequacy ratio in December 2011 was lower by 0.63 pp
than as at December 31st 2010 due to an increase in the total capital
requirement by ca. 8% over the period and asimultaneous increase in
own funds by 4.5%.
The increase in total capital requirement as at the end of December 2011
was mainly influenced by ahigher capital requirement for credit risk,
driven by growth of the Banks loan portfolio.
44
The reduction of the capital requirement for operational risk was possible
following the implementation of the advanced method (AMA) for measurement of this risk.
In 2011, Tier 1 capital of the Bank Pekao S.A. Group increased by 4.5%,
mainly thanks to the appropriation of the Banks net profit for 2010 in the
amount of PLN 767.4 million for the own funds pursuant to adecision of
the Banks Ordinary General Meeting of Shareholders.
Bank Pekao S.A. on the Polish

Banking Market
Bank Pekao S.A. is auniversal commercial bank, providing afull range
of banking services to individual and institutional clients, both in Poland
and abroad. The Bank Pekao S.A. Group comprises financial institutions
operating in the banking, asset management, pension funds, brokerage,
leasing and factoring markets.
The Bank offers its clients access to an extensive distribution network,
with ATMs and banking outlets conveniently located throughout Poland.
Total number of outlets

Total number of own ATMs
31.12.2011
31.12.2010
1,002
1,817
1,014
1,800
The Banks clients can also make commission-free cash withdrawals

from more than 2.9 thousand ATMs of the Euronet network.
As at the end of December 2011, the Bank operated 4,833.9 thousand
PLN-denominated current accounts, 223.0 thousand mortgage loan accounts, and 685.0 thousand consumer loan accounts.
(in thousand)
31.12.2011
31.12.2010
Total number of PLN-denominated

current accounts*
4,833.9
4,743.0
of which packages
Number of mortgage loan accounts**
of which PLN mortgage loan accounts
Number of consumer loan accounts ***
3,577.5
223.0
176.7
685.0
3,489.2
201.9
152.0
703.3
* Number of accounts including accounts of pre-paid card accounts.

** Accounts of retail customers.
*** Poyczka Ekspresowa(Express Loan).
Individual Clients
Retail Banking
The Banks activity in 2011 focused on consistent strengthening its position
on the consumer finance and mortgage loans markets. At the same time, the
Bank continued actions aimed at expanding savings products and cards offering as well as further development of Pekao24 electronic banking system.
A new type of current account was added to the offering of personal
accounts Eurokonto Mobilne account. Eurokonto Mobile is amodern
package of mobile solutions, coming with aspecial application which
operates on the majority of mobile devices and supports most operating
systems. The application has aclear and intuitive interface, which distinguishes it from other similar solutions available on the market.
Moreover, we continued activities promoting the use of electronic bank

statements, thus implementing astrategy of limiting paper correspondence and supporting environmental initiatives. The ratio of current
accounts with electronic bank statements to the total number of current
accounts increased from 55.4% in 2010 to 63.6% as at the end 2011
(8.2 pp). The number of accounts with electronic statements increased by
243.5 thousand.
Affluent Clients
Affluent clients, who expect an individualised approach and non-standard
solutions, are served through the Advisory Centers model.
The model, under which client relations are largely handled by adedicated adviser, helps build apersonal relationship and intensify cooperation. It
allows us to gain an ever-better understanding of the needs of each client
and drawing on the Banks wide array of products choose the optimal
financial solutions.
The key element of the Banks product offering in this client segment is
the Eurokonto Premium Plus account, which offers clients the following
benefits:
Personal Adviser service at the Advisory Center,
free-of-charge Assistance insurance, including personal assistant
(Concierge) service,
attractive rate of interest on the related Dobry Zysk savings account,
free-of-charge online transfers and standing orders,
an option to open additional free-of-charge accounts for children and
foreign-currency accounts,
free-of-charge debit card enabling commission-free transactions in
shops and other retail and service outlets, as well as commissionfree cash withdrawals from ATMs belonging to the Bank, the
domestic Euronet ATM network and the European UniCredit Group
ATM network.
In mid 2011 we finalised implementation of the New Service Model
for the affluent clients segment, thanks to which all personal advisers
can offer aunique solution to such clients. The Service Model is focused
on investments and relies on an analysis of the clients individual
financial situation with aprofessional tool the Investment Navigator.
During ameeting with the client the adviser uses the Investment Navigator functionalities to help the client go through each stage of the investing
process, from the analysis of the clients financial situation and objectives
to the selection of optimal investment products for amodel investment
portfolio.
Another major focus of our activities in the affluent clients segment in
2011 was strengthening of the image of the personal advisers through
facilitating access to their services, also via the electronic banking
platform Pekao24, and through training designed to develop the advisers
competence.
45
Private Banking
In the area of private banking, 2011 saw intensified sales and marketing
activities aimed at ensuring that the Banks highest worth clients are offered the highest quality of service and access to the best solutions based
on professional assistance of dedicated advisers.
In 2011, subscriptions for structured deposit accounts Indeks na Zysk
were continued. Clients were offered new subscriptions: a3-month
Indeks na Zysk deposit linked to the CHF/PLN exchange rate, an
18-month Indeks na Zysk deposit linked to copper, sugar and crude
oil prices, a3-month Indeks na Zysk deposit linked to the USD/PLN
exchange rate, and two 3-month Indeks na Zysk deposits linked to the
EUR/PLN exchange rate. Attractive terms of the structured deposit accounts, which were settled in 2011 with the rate of return higher than the
average interest rate on deposit accounts, encouraged clients to invest
substantial funds in new subscriptions of these products.
Guided by the objective to ensure the highest quality of service and
operational efficiency, we continued the training programme under the
name Certified Financial Consultant, drawing on the best practices of
the UniCredit Group. Private Banking Advisers were awarded certificates
of prestigious European training institutions, such as European Planning
Association and Austrian Financial Planners, thereby joining the group of
the best trained banking advisers in Poland.
Sales of mutual funds units were supported by workshops and meetings
organised for the Private Banking Division employees by representatives
of selected asset management companies. In the largest cities several
investment meetings were held, during which adiscussion about the current market environment was connected with apresentation of proposed
investment solutions. In 2011, Private Banking clients were offered an
opportunity to subscribe for selected close-end funds units through
Centralny Dom Maklerski.
As part of initiatives intended to enhance customer service, our CRM application (UniSales), supporting efficiency and customer relationship management, was upgraded with new Private Banking functionalities. In this way,
the information flow process was improved and the Bank is able to better
respond to clients needs, and thereby to increase customer satisfaction.
Savings Products
In 2011, the Bank continued activities aimed at promoting the idea of
regular savings through the Moja Perspektywa Regular Savings Programme, prepared in cooperation with the mutual fund company Pioneer
Pekao TFI and offered since 2010. These activities were supported by
campaigns in the press and on the Internet.
In response to clients high interest in safe financial instruments, the Bank
expanded its offering of mutual funds with new funds applying portfolio
hedging strategies:
Pioneer Zmiennej Alokacji Rynki Wschodzce SFIO,
Pioneer Zmiennej Alokacji Rynki Europy Wschodniej SFIO.
46
In 2011, we offered to our clients nine issues of capital protected structured certificates of deposit:
Certyfikat Skarby Natury,
Certyfikat Blask Zota 1, 2 and 3,
Certyfikat Sia Orientu 1 and 2,
Certyfikat Rynku Rolnego,
Certyfikat Walutowy EUR/PLN and EUR/PLN 2.
Within the range of structured certificates of deposit the Bank launched
for the first time certificates with ashort, 6-month maturity.
The Banks offering was additionally extended with the Pioneer Akcji
Aktywna Selekcja fund, which is asubfund of Pioneer FIO whose assets
are mainly invested in carefully selected shares of companies listed on
the Polish stock exchange and in other equity instruments.
In September 2011, we launched the first absolute return fund Pioneer
Elastycznego Inwestowania SFIO. Its investment strategy assumes achieving apositive nominal rate of return irrespective of the situtation on the
capital market.
Moreover, in 2011 anew portfolio, Portfel Zrwnowaony Europy
rodkowej, was added to the Super Basket Programme in cooperation
with Pioneer TFI. The structure of the new portfolio is as follows:
50% Pioneer Obligacji Dynamiczna Alokacja FIO,
30% Pioneer FIO Pioneer Akcji Aktywna Selekcja subfund,
20% Pioneer Funduszy Globalnych SFIO Pioneer Akcji Europy
Wschodniej subfund.
Clients expecting high returns and safety of their assets could choose
term deposits or Dobry Zysk savings accounts. In the second half of
2011, clients were also offered the Lokata Progresywa term deposit with
attractive interest rates of up to 8% in the last month of the deposit.
Bancassurance
In 2011, the Bank intensified activities aiming at the development of
bancassurance offering. It was extended with the following new insurance
products:
Payment Protection Insurance paid insurance of outstanding credit
card balance repayment. The product was designed in cooperation
with Ergo Hestia.
Creditor Protection Insurance paid insurance dedicated to business
customers who apply for an investment loan; apioneering product on
the banking market, designed in cooperation with Allianz.
Allianz Direct Insurance paid insurance offered directly via Internet
website or telephone.
New, extended Tourist Insurance Packages added free of charge to
platinum, gold and silver credit cards.
Loans
Consumer Lending
In the area of consumer lending, the Bank was consistently pursuing the strategy geared towards strengthening its position on the
consumer finance market, developing its product portfolio as well as
distribution and marketing communication, while maintaining prudential credit risk policy.
These efforts were supported by active promotion of the Poyczka
Ekspresowa loan through local and country-wide advertising campaigns on television, in the press and over the Internet, which led to
aconsiderable 18% growth in sales of the product in comparison
with 2010, translating into arise in amounts due from clients. Thanks
to very good sales of Poyczka Ekspresowa in 2011, our cash loan
portfolio grew at afaster pace than the market, which allowed us to
expand our market share.
In 2011, the Poyczka Ekspresowa offering was supplemented with
special seasonal offers addressed to current and prospective clients of
the Bank. We also launched apromotional loan offer for selected client
groups and extended the scope of borrowers insurance with additional
services. The sales activities were supported with advertising campaigns
promoting Poyczka Ekspresowa on television, in the press and over the
Internet. The expanded offer of the Poyczka Ekspresowa loan was also
actively promoted through local marketing.
Moreover, anew website dedicated to the product was launched. It stands
out from web pages of the competitors with its innovative graphic design
and modern solutions, which facilitate access to information and contact
with an adviser. aspecial version of the Poyczka Ekspresowa website can
also be accessed with mobile devices such as smart phones and tablets.
The Bank concentrated not only on improving effective use of the
customer base through increasing the frequency of contacts, but also on
strengthening relations with clients through electronic distribution of individual loan offers and on reaching prospective clients through no-address
mailing. At times of increased clients interest in loan offers, we organised
special actions facilitating access to our products by extending opening
hours of the Banks branches.
In 2011, the existing Banks regulations on consumer lending were
adapted to the amended Consumer Credit Act.
Mortgage Loans
In 2011, the Bank was consistently strengthening its marketing activities through promotional campaigns, including advertising campaigns
run on the Internet, in the press and on the radio, short-term local and
countrywide campaigns featuring special price offers, participation in
Housing Trade Fairs organised in various places in Poland, and intensified
cooperation with sales partners and real estate developers.
The mortgage loans offering was regularly updated and adjusted to

reflect changing conditions and market needs, and to comply with legal
regulations, including in particular recommendations issued by banking
supervision authorities.
In 2011, anew mobile version of the mortgage loans website was
launched at m.kredyty-hipoteczne.pekao.com.pl. With its convenient
and intuitive interface dedicated to mobile devices, the website provides
clients with information on mortgage loans and facilitates contact with the
Bank.
The above mentioned initiatives contributed to an almost 27% year-onyear increase in sales of PLN mortgage loans in 2011 and expansion of
the market share in sales of this product by ca. 18%. They also strengthened Bank Pekao S.A.s image of abank enjoying astrong position on
the housing loans market.
The Bank was still actively involved in the sale of preferential loans subsidised within the framework of the governmental housing loan scheme
Family in Their Own Home. The share of such loans in our total portfolio
remained substantial, as they accounted for nearly half of all housing
loans advanced by Bank Pekao S.A. in 2011.
Payment Cards
In 2011, aprocess of renewal of payment cards linked to current
accounts was conducted. The reissued Maestro cards were equipped
with microprocessors compatible with the EMV standard, and pay-pass
functionalities enabling fast and secure low-value payments. Having
implemented contactless payments technology, the Bank now offers its
clients acomplete range of contactless debit and credit cards provided
by MasterCard, Maestro and VISA.
The Bank also launched anew payment card linked to selected Eurokonto accounts, bearing the sign of The Great Orchestra of Christmas
Charity Foundation Debit MasterCard PayPass WOP. By using the
card, its holder can support the Foundation throughout the year. Contactless cards issued by the Bank are increasingly popular among clients,
being amodern and convenient payment instrument.
The Bank promoted use of payment cards by introducing attractive
discounts programmes. Clients using the Pa kart, bo warto! (Pay with
acard. Its worth it!) discount programme have access to amodern
website and mobile service based on the Mobilny Planer Zakupw (Mobile
Shopping Planner) application. These modern tools, which use Google
Maps and GPS, facilitate searching for attractive discounts and planning
optimal shopping with the Banks cards.
The Bank also continued sales of Silver and Gold credit cards with the
image of the UEFA Champions League, whose official sponsor is the
UniCredit Group.
47
Brokerage Services
Dom Maklerski Pekao (Dom Maklerski), the Banks specialised organisational unit, and Centralny Dom Maklerski Pekao S.A. (CDM), the Banks
subsidiary, are entities of the Bank Pekao S.A. Group specialising in
brokerage business, which offer awide range of capital market products
and services for retail customers.
As at the end of 2011, the two entities operated 376.3 thousand investment accounts, 16.7 thousand less than as at the end of 2010. The
decline was largely aresult of collection of overdue receivables and the
fact that in 2011 there were fewer IPOs (in particular large privatisation
transactions of the Ministry of State Treasury) than in the previous years.
The Bank Pekao S.A. Group provides also electronic investment account
services, which enable clients to buy and sell any financial instruments
listed on the Warsaw Stock Exchange (WSE) and the BondSpot market
over the Internet. In 2011, the number of clients with electronic access
to investment accounts increased. As at the end of 2011, both brokerage
entities operated 162.7 thousand online accounts, 25.3 thousand more
than as at the end of 2010.
The number of investment accounts maintained by the Bank Pekao S.A.
Group entities represents approximately 25% of the total number of investment accounts held with all entities providing brokerage services in Poland.
The value of assets deposited in accounts at Dom Maklerski and CDM
amounted to PLN 19.9 billion as at the end of 2011, compared with
PLN 25.7 billion as at the end of 2010. The decrease was aconsequence of the global debt crisis, changes of the trend prevailing on global
financial markets, and pessimistic economic growth forecasts, which led
clients to withdraw from high-risk investments and caused adrop in the
valuation of assets deposited in clients accounts and mutual funds. In
2011, the WSEs blue chip index WIG 20, and broad market index WIG
lost 21.9% and 20.8%, respectively.
In 2011, Dom Maklerski and CDM generated aturnover of
PLN 20.3 billion on the stock market (up by 5.7% in relation to 2010)
and PLN 259 million on the WSE bond market (down by 60.5% in relation
to 2010).
Their turnover on the futures market in 2011 was 1,600.7 thousand
contracts, up by 0.2% in relation to 2010.
In 2011, the share of the two entities in transactions executed on the
WSE was as follows:
15.5% share in the bond trading volume,
5.5% share in the futures trading volume,
3.8% share in the stock trading volume.
In 2011, the estimated total share of Dom Maklerski and CDM in stock
trading on the WSE in the retail segment amounted to 21.2%, and in the
volume of futures trading in this segment to 12.2%.
48
In 2011, the projects pursued in the area of brokerage business focused

on the launch of new brokerage services, alignment of the range of offered products at the two entities, and improvement of customer service
standards. Within aframework of offer alignment, clients of Dom Maklerski obtained access to 17 new foreign markets.
Moreover, 2011 saw commencement of the preparatory phase of the
strategic Universal Trading Platform (UTP) project, which will enable
implementation of advanced trading functionalities, available on highly
developed capital markets. The project will be finalised in 2012.
On October 18th 2011, another Group member, Xelion. Doradcy Finansowi Sp. z o.o., obtained abrokerage licence from the Polish Financial
Supervision Authority. Xelion. Doradcy Finansowi Sp. z o.o. is an associated company, in which the Bank holds a50% stake.
Alternative Distribution Channels
The number of individual and business clients opting for alternative
distribution channels the Internet banking platform and Contact Center
is steadily growing. The Pekao24 service (dedicated to retail clients),
PekaoFIRMA24 (dedicated to SME clients) and PekaoBIZNES24 (dedicated to
corporate clients) facilitate management of financial assets and the range of
services available through those systems is being regularly expanded.
Pekao24
The Pekao24 electronic banking system is aconvenient and secure channel giving access to accounts held with the Bank, Dom Maklerski Pekao
and Centralny Dom Maklerski Pekao S.A. The service enables clients to
manage funds accumulated in their accounts over the Internet, fixed-line
or mobile phone, and through the Contact Center.
As at the end of December 2011, the number of Pekao24 users totalled
1,963.0 thousand. In 2011, 1,215.0 thousand clients logged in to the
Pekao24 system, and online transactions accounted for 92% of all transactions executed through Pekao24.
(in thousand)
Number of individual clients with access to

electronic banking Pekao24 as at the end
of period
Number of individual clients actively using
electronic banking Pekao24* system
Number of individual clients using mobile
banking
31.12.2011
31.12.2010
1,963.0
1,711.3
1,120.3
1,021.0
68.8
27.0
* A customer actively using electronic banking is acustomer who logged in to the system at
least once during the last quarter.
The most important projects relating to the Pekao24 system implemented

in 2011:
Launch of the Pekao24 mobile banking application. The application
can be downloaded to amobile phone or another mobile device. It
gives afast and easy access to accounts and other products of the
Bank, and enables its user to place banking orders anytime and
anywhere. The application also offers additional functionalities, such as
the geolocation feature which helps the user find an ATM, the Banks
branch or shops and service outlets where the Banks clients can
obtain discounts. It is compatible with mobile devices running the following operating systems: iOS, Blackberry, Android, Windows Mobile,
Symbian and Java.
Development and launch of amicroservice at www.impekao24.pl,
which includes multimedia presentations and animations showing
clients how to use the Pekao24 mobile and online banking service.
Introduction of anew functionality in the online service, allowing clients
to send and receive Western Union cash transfers in the Polish zoty
and U.S dollars, check the transaction status, obtain information on the
amount of points accumulated on the GOLD loyalty card, and import
the recipients data when making anext transfer.
Enabling clients to make transfers in the SEPA standard.
Providing access to information on an account in Pekao Otwarty
Fundusz Emerytalny (open-end pension fund), including the account
balance and history of transactions.
Launch of anew version of the PekaoToken application for mobile
handsets supporting the Android system. PekaoToken is asafe, convenient and modern mobile application for authorising transactions in
the Pekao24 Internet service.
Introduction of ahardware token adevice generating codes for
authorising transactions executed through the Internet and telephone
service of the Pekao24 system. It is an additional method of authorising transactions, alternative to codes generated by the PekaoToken
application, SMSs codes and single-use code cards.
Implementation of anew functionality, allowing clients to check their
account balances through the summary of all clients assets and
liabilities.
Providing the contact data of the clients banking adviser in the
Pekao24 Internet service.
Solutions facilitating management of standing orders.
Extension of the list of Internet shops where clients can pay with an
e-transfer; Pekao24Przelew is aquick money transfer directly from the
clients account to the recipients account, which does not attract any
commission, irrespective of the type of the clients bank account.
Continued educational campaign for users of the Pekao24 service,
related to safe use of the Internet. This project is also supported by
publication of the Safe Internet newsletter.
Simplification and grouping of new functionalities in the menu of the
Internet service.
Contact Center
Our Contact Center is aprofessional customer service center that supports completion of the Banks projects and achievement of business
goals through telemarketing campaigns, dealing with incoming clients
calls, e-mails and SMS messages.
The number of all calls handled in 2011 totalled 12,721.2 thousand.
The number of outbound calls initiated by the Contact Center was
10,021.8 thousand, including 3,368.3 thousand commercial outbound
calls initiated by consultants as part of telemarketing campaigns (17% increase in comparison with 2010). The growth in the number of outbound
calls was aresult of greater involvement of the Contact Center in sales
processes, mainly in telemarketing campaigns and in dealing with contact
requests submitted through the Banks website.
The number of inbound calls handled by the Contact Center in 2011 was
2,699.4 thousand, adecrease of 7.5% in comparison with 2010. The
decline follows from growth in clients activity in the Internet, which is
increasingly used by clients to make transactions and look for information
about the Banks services.
(in thousand)
Total number of outbound calls from

Contact Center
of which calls initiated by Contact Center
to support the sales process
Number of inbound calls to Contact Center
Total number of calls handled by Contact
Center
2011
2010
10,021.8
9,535.6
3,368.3
2,878.4
2,699.4
2,918.9
12,721.2
12,454.5
Small-Sized and Micro Enterprises

The Banks offering includes acomprehensive spectrum of the most
advanced products and services targeted at small-sized and micro
enterprises.
In the SME segment the Bank continued its growth path in lending avisible growth in sales of loans translated into higher credit volumes as at
the end of 2011, up by nearly PLN 800 million (17%) in comparison with
the end of 2010.
The loan offering was extended to include new products for selfemployed professionals and acomprehensive solution for refinancing
of short-term loans taken at other banks. The Bank also introduced
certain improvements in the area of procedures: the short-term loan
renewal process was simplified and the service process related to
the Zaliczka loan for advance funding of invoices was automated and
centralised.
49
In 2011, adebit card linked to EUR-denominated accounts was introduced. The Bnak also continued active sale of the attractive products
launched in previous years: approximately 14 thousand MOTO Biznes
credit cards and approximately 14 thousand Mj Biznes Net packages
were sold.
The Bank started implementation of agreements concluded with the
European Investment Bank (EIB) and the European Investment Fund (EIF).
In 2011, 500 SME clients took advantage of investment loans refinanced
by EIB. Entrepreneurs used also guarantees of EIF granted under the European Unions Competition and Innovation programme. In 2011, 1,040
investment loans and 460 working capital loans guaranteed by EIF were
granted to start-ups.
Moreover, the Bank consistently made an effort to enhance the competences of its employees working with SME customers. 2011 saw the
launch of anew edition of atraining programme designed to develop employees business competence in the area of establishing and maintaining
customer relations as atool for increasing SME clients satisfaction.
PekaoFIRMA24
PekaoFIRMA24 is asystem dedicated to small and medium-sized companies. Its extensive functionalities and flexibility in the management of
privileges and modules meet the expectations of business customers and
make it possible to tailor the service to the specific needs of enterprises.
As at the end of December 2011, the PekaoFIRMA24 system was used by
179.3 thousand companies, of which 109.7 thousand were active users.
In comparison with the end of 2010, the number of clients with access to
the system grew by 23.7 thousand.
(in thousand)
Number of business clients (SME)

with access to electronic banking
PekaoFIRMA24 as at the end of period
Number of business clients (SME)
actively using electronic banking
PekaoFIRMA24*
31.12.2011
31.12.2010
179.3
155.6
109.7
97.9
* A customer actively using electronic banking is acustomer who logged in to the system at
least once during the last quarter.
The improvements introduced into PekaoFIRMA24 in 2011 had apositive effect on the number of transactions processed through the system.
The number of transactions orders in 2011 exceeded 23.9 million, while
the value of PLN transactions reached PLN 112.9 billion, an increase of
25.8% and 37.7%, respectively, in comparison with 2010.
In 2011, further improvements were made in response to clients
expectations and changes in law. They involved the systems functionality,
interface and optimised operation.
The most material changes introduced in the PekaoFIRMA24 system in

2011 were:
Introduction of adealing module, which facilitates execution of FX
transactions by clients without the need to contact the Bank.
Deployment of the POS module, which enables clients to view, sort and
download reports on transactions processed through POS terminals.
The service supplements the Mj Biznes patniczy packages, which
allow clients to use POS terminals of the Bank and other providers.
Enabling clients to make transfers in the SEPA standard.
Launch of an SMS starter kit that makes it possible to send SMSs with
initial passwords to mobile phones of trusted users.
Enhancement of the PekaoFIRMA24 communication module, which presents key information and marketing advertisements in graphical form.
Optimisation changes, including the possibility of granting authorisations in packages, which makes use of PekaoFIRMA24 easier and
faster.
Corporate Clients
Bank Pekao S.A. is amarket leader in the provision of banking services
to large and medium-sized enterprises, offering acorporate product mix
which ranks among the most comprehensive ones on the market. The
Corporate Banking, Markets and Investment Banking Division has overall
responsibility for services rendered to corporates, institutions and public
sector entities.
The service model for corporate customers is based on the key role of
adedicated Relationship Manager, responsible for identifying the customers needs and selecting suitable banking products and services. The
Relationship Managers are assisted by product specialists.
Large corporates are served on an individual basis by Relationship Managers working from the Head Offices Department of Large
Corporates, which is divided into service offices dedicated to different
industries.
A dedicated unit was also set up at the Head Office level which serves
the financial and public sectors, tailoring the Banks products to suit the
individual needs of customers from those sectors.
With aview to ensuring comprehensive banking and advisory service for
medium-sized enterprises, they are served through Regional Corporate
Centers, organised within macro-region structures.
Corporate clients have access to the Pekao BusinessLine call centre,
which offers support related to transactional banking products and
services, processes complaints and conducts information campaigns.
Moreover, each client can use direct assistance of adedicated account
manager after passing an identification procedure.
The range of services includes afull suite of lending and deposit products, transactional banking services as well as other financial services,
50
including guarantees and sureties issued in domestic and foreign

transactions, and services provided through our leasing and factoring
subsidiaries.
The Bank is aleading arranger of project financing, M&A financing and
debt security issues. The Banks clients benefit from awide range of
money market products and FX products, to be used either in day-to-day
operations or to build long-term risk hedging structures with respect to
currency or interest-rate risk.
Transactional Banking Services
The Bank makes an effort to continually expand and upgrade its comprehensive range of transactional banking services, and consequently it
ranks among the best ones on the market.
In 2011, anumber of new functionalities and improvements, relying on
solutions applied on international markets, were implemented in the area
of cash management:
Implementation of anew AutoDealing functionality in the PekaoBIZNES24
electronic banking system, which supports execution of spot FX
transactions and deposit transactions in the zoty and foreign currencies. The AutoDealing module significantly streamlined the process
of making FX transactions and placing deposits by the Banks clients
and eliminated the necessity to contact the Bank by telephone to order
each transaction.
Introduction of aunique solution which consists in processing of all
transfers to EEA countries as fast transfers.
Extension of the time for acceptance of foreign transfer orders.
Implementation of anew service Pekao Collect FX, enabling identification of the payer and reporting of single foreign-currency payments,
both foreign and domestic.
Addition of USD, EUR, CHF and GBP to the range of currencies in
which cash payments can be made as part of the Autowypata service,
and introduction of the possibility of using the PekaoBIZNES24 system
to place orders for acash payment to aforeign beneficiary which can
be executed at any of the Banks branches.
The most important solutions introduced in 2011 in the area of domestic
payments were extension of salary payment service Pekao Pace (the
service users can now place electronic orders for payment of salaries
from the payroll account in the form of acash payment or apostal order,
in addition to the standard form of bank transfer) and anew procedure
for entering funds cleared through the SORBNET system in the books
(relevant amounts are entered in the books immediately, therefore clients
quickly gain access to funds from high-amount settlements and can manage their liquidity more effectively).
In 2011, the Bank acquired new billers for the eFakura24 service. We
successfully implemented the new Electronic Bill Presentment and Payment service called eFaktura24, introduced in 2010. The service is used
by alarge telecomunications company to distribute and collect payments
under electronic invoices. Acquiring amajor mobile carrier is an important
stage in the promotion of the service. It can be used by businesses to

collect receivables from their customers quickly and effectively, while for
the customers it is aconvenient method of paying their bills with the use
of an electronic banking system.
The competitive edge of the Banks transactional banking products
and services, effectiveness of our sales policy and usefulness of the
implemented improvements are attested to by an over 12% increase in
the foreign transfers volume, a10% increase in the number of domestic
transactions and aPLN 350 billion growth in their volume as well as
a22% rise in the number of incoming transactions in the bulk payment
identification service Pekao Collect in relation to 2010.
In 2011, the range of the Banks corporate payment cards was extended
with:
Prepaid cards, which can be used as substitutes for cash, cash
transfers and vouchers. Thanks to the wide application of the cards
and advanced technology, Pekaos cards are one of the most attractive
prepaid products available on the market.
MasterCard EURO Corporate Debit Pekao debit cards denominated in
the euro and linked to aeuro account.
Investment Banking and Structured Finance
In 2011, Bank Pekao S.A. maintained its leading position in structured
and syndicated debt products by providing funding to clients operating
in virtually all industry sectors, including large-volume funding for energy
and telecommunications companies, which contributes to diversification
of risk.
The Bank was active in the area of advisory services relating to structuring and raising debt financing for investment projects and acquisitions. It was involved in most of the major syndicated transactions
executed on the Polish market in 2011, structuring the deals or acting
as the arranger.
Corporate debt refinancing and acquisition financing transactions had the
largest share in the transactions made in 2011 in terms of both number
and volume.
The marked recovery of the M&A market in 2011 contributed to further
strengthening of our leading position in leveraged buyouts.
The growth was also reported in project finance transactions. Furthermore, the Bank participated in commodity financing deals executed for
large Polish companies, which are anovelty on the Polish market.
Financial Market and Debt Issues
In the area of arrangement and management of commercial paper
issues Bank Pekao S.A. emerged as number one player, holding on to
its leading position with amarket share of more than 20% as at the
end of December 2011 (based on Rating & Market published by Fitch
Poland).
51
The Banks market position in the respective categories was as follows:

1st position in the category of corporate bonds and revenue bonds
issued by companies (with maturities over 365 days) with amarket
share of nearly 27%,
2nd position in the category of covered bonds with amarket share of
over 28%,
2nd position in the category of municipal bonds (with maturities over
365 days) with amarket share of almost 25%,
2nd position in the category of short-term debt securities with amarket share of 20%.
In 2011, the Bank signed 45 contracts for arrangement and management
of debt issues for corporations and municipalities, including:
12 new contracts on bond issues (short- and medium-term) for
companies from anumber of industries, including the power, fuel,
transport, capital market and real estate development sectors,
32 contracts on municipal bond issues for local government
institutions,
1 contract for adebt issue programme (involving certificates of deposit
and bonds) for acommercial bank.
The most noteworthy transactions in the area of commercial paper issues
were:
Increase in the amount of acorporate bond programme for afuel sector company to PLN 7 billion. The Bank participated in the syndication
acting as the Arranger, Underwriter and Document Agent.
Signing of abest-effort contract for aPLN 5 billion bond issue for one
of the largest companies in the Polish power sector. Bank Pekao S.A.
acted as the Arranger, Issue Agent and Dealer.
Increase in the amount of abond programme for apower sector
company to PLN 4.3 billion. Proceeds from the bonds issued as part of
the programme were used to finance acquisition of assets of another
power sector company. Bank Pekao S.A. participated in the syndication
acting as the Arranger and Underwriter acquiring bonds on the primary
market.
PLN 170 million 5-year corporate bond issue for aclient from the capital market sector. The Bank acted as aJoint Manager. The issue was
carried out as apublic offering conducted exclusively in Poland and
addressed only to qualified investors.
In the third quarter of 2011, Bank Pekao S.A. was granted the status
of Treasury Securities Dealer in 2012 following the closing of another
edition of acompetition to select Treasury Securities Dealers, organised
by the Ministry of Finance. The Bank has maintained ahigh position in
the competition ranking and is one of key participants of the treasury
securities market.
Custodial Services
In the area of custodial services our clients are domestic and foreign
financial institutions, banks providing custodial and investing services,
insurance companies, mutual and pension funds as well as non-financial
institutions.
52
The Banks custodial services include in particular clearing of transactions

executed on domestic and international financial markets, custody of
assets, handling of securities and cash accounts, asset valuation, services
related to dividend and interest payments as well as acting as the custodian for mutual and pension funds.
In 2011, Bank Pekao S.A. maintained its market leader position in the
area of depositary receipt programmes, handling more than 50% of such
programmes.
Comprehensive Services for the Public Finance Sector
In 2011, Bank Pekao S.A. held on to its leading position of the market
of financial services for local governments, appreciating the potential
that stems from its presence on this market and recognising the specific
needs of this client group.
The Bank participated in capitalintensive municipal investment projects,
including projects connected with preparation of the Polish infrastructure
for the EURO 2012 European Championship.
The Bank provided financing to five regional airports in Poland (including
Wrocaw, Pozna, d and Modlin) and to municipal public transport and
sports projects. Moreover, it acted as the arranger of abond programme
to finance the construction of asports and entertainment arena in Toru.
Given the type of the project and the legal structure put in place to reduce
the risk, it was alandmark transaction.
Direct financing of the public sectors budgets through bond issues
and loans is one of the Banks strengths. In 2011, the Bank arranged
25 major bond programmes for local governments. Its exposure to
municipal bonds rose from PLN 1.6 billion as at the end of 2010 to
PLN 4.9 billion as at the end of 2011. The Bank ranked first among
arrangers of municipal bond issues in Poland in 2011 in terms of the
total value of issues.
As regards current financing of local governments, the Bank maintained
its leading position, providing services to six out of twelve major Polish
cities. In 2011, this group was joined by Gdask.
Bank Pekao S.A.s Participation in Financing EU Projects and
Cooperation with European Financial Institutions
As aresult of its active participation in EU aid funds programmes, Bank
Pekao S.A. is at the forefront of the market of EU financing for companies.
A new version of aloan intended to finance projects involving implementation of innovative technologies by businesses (technological
loan) was added to our offering. The new version of the product was
developed in response to the changed market conditions following
amendment to the Act on Certain Forms of Support for Innovative
Projects. The amendment provides for more relaxed conditions for payment of the technological premium after completion of the investment
project by an entrepreneur, and expands the catalogue of expenses
qualifying for co-financing from EU funds. The changes reduce the risk
and increase availability of the loan for the Banks clients.
Bank Pekao S.A.launched also loans refinanced by the European Investment Bank (EIB) and intended to finance public sector projects. Bank
Pekao S.A. is abeneficiary of grants from the European Commission
under the Municipal Finance Facility and Municipal Infrastructure Facility.
The Bank continues to offer EIB-refinanced loans for medium-sized and
large corporate clients.
Dom Maklerski Pekao (Dom Maklerski) and Centralny Dom Maklerski

Pekao S.A. (CDM) the Banks subsidiary are specialized entities rendering brokerage services within the Bank Pekao S.A. Group, which provide
retail customers with awide range of products and services on the capital
markets. Detailed description of the brokerage activity is included in
Brokerage services above.
Below are described the areas of operations of the Groups key companies from the financial sector.
Banking Activity
Cooperation with International and Domestic Financial Institutions
Bank Pekao S.A. maintains correspondent relations with over
2.6 thousand foreign and domestic banks (by number of SWIFT keys).
At the end of 2011, we maintained nostro accounts in 81 banks and
kept 300 loro accounts for 250 foreign customers, including banks and
financial institutions.
In 2011, the Bank entered into cooperation with 14 foreign banks from
different regions of the world as partners or clients in the area of clearing
services with respect to the Polish currency. Cooperation in inter-bank
settlements and commercial transfers with two foreign banks which are
leading financial institutions was significantly expanded.
Bank Pekao S.A. acts as an intermediary in transactions executed for
clients of other Polish banks, and for that purpose maintains 40 foreigncurrency loro accounts for 13 Polish banks and holds 5 foreign-currency
nostro accounts with 2 Polish banks. The accounts are used to handle
clearing of retirement and pension benefits paid by the Social Insurance
Institution (ZUS) and to render custodial services. The Bank also provides
services consisting in purchase and sale of Polish and foreign coins and
banknotes to Polish banks and Polish branches of foreign banks.
In 2011, the Bank made an ongoing effort to enhance its portfolio
of transactional products for correspondent banks. The projects
undertaken in this area involved provision of broad online access
to loro accounts, clearing of payments in accordance with Directive
2007/64/EC on payment services in the internal market, and access
to Target2 an interbank payment system for real-time processing
of cross-border transfers throughout the EU. We achieved avery high
straight-through processing rate of 98-99% of the completed client
and inter-bank transactions.
PJSC UniCredit Bank UniCredit Bank

PJSC UniCredit Bank operates in the Ukrainian market as awholly-owned
subsidiary of Bank Pekao S.A. It pursues its activity through anetwork of
49 branches, developed as agreen field project and partly as aresult of
the merger with HVB Bank Ukraine. The bank provides services to
88.9 thousand individual customers and 4 thousand corporate clients.
In 2011, as the loan portfolio quality stabilised and costs were kept under
strict control, UniCredit Bank generated net profit of PLN 57.7 million. The
bank maintains asound capital structure with the capital adequacy ratio
(Basel II) at the level of 35.6% as at the end of 2011.
The operations and performance of the bank are under continuous
monitoring, specifically with the use of reinforced credit risk control
procedures.
The Bank Pekao S.A. Group plans to concentrate its activities on the
Polish market and therefore aprocess aiming at disposal of the whole
exposure of Bank Pekao S.A. in PJSC UniCredit was commenced.
Pekao Bank Hipoteczny S.A. Pekao Bank Hipoteczny
In 2011, Pekao Bank Hipoteczny, as aspecialised mortgage bank, continued to pursue its strategy focused on the creation of asecure loans portfolio and strived to maintain competitive position on the market of housing
loans for individuals and loans for the financing of purchase, construction,
refurbishment or modernisation of commercial properties.
As at the end of 2011, Pekao Bank Hipotecznys loan portfolio was
valued at PLN 1,807.0 million (slight growth year on year). Loans granted
to individual clients and corporate clients and local governments have
comparable shares in the loan portfolio structure.
Major Areas of
the Groups Activities
As aresult of the strategy to focus on financing of medium-sized projects,

in 2011 the volume of new commercial real estate loans accounted for
76% of the total loan sales.
Bank Pekao S.A. is one of the leading providers of banking services which
groups together anumber of financial institutions active in the banking, asset management, pension funds, brokerage services, leasing and
factoring markets.
In the first half of 2011, the bank successfully conducted two public
issues of mortgage covered bonds as part of the second Programme of
Mortgage Covered Bonds in Bearer Form. The value of the issues was
PLN 250 million and PLN 150 million.
53
Asset Management
Leasing Activity
Pioneer Pekao Investment Management S.A. PPIM

Under amanagement agreement, PPIM manages the assets of mutual
funds managed by Pioneer Pekao Towarzystwo Funduszy Inwestycyjnych
S.A. (Pioneer Pekao TFI). The companys service offering includes also
management of private clients portfolios on afee basis.
Pekao Leasing Sp. z o.o. Pekao Leasing

Pekao Leasing provides financial services supporting purchases and sale
of fixed assets, i.e. vehicles, plant and equipment, and office space, both
in the form of operating and finance leases.
The Bank holds a49% stake in PPIM.

As at December 31st 2011, the net asset value of mutual funds under the
management of Pioneer Pekao TFI amounted to PLN 13,780.9 million,
adecrease of PLN 4,277.8 million (23.7%) as compared with the end of
2010. The decline was driven by the global debt crisis, which triggered
awave of redemptions, and adrop in stock indices.
The net value of assets of mutual funds managed by Pioneer Pekao TFI
acquired through Bank Pekao S.A., CDM and Xelion. Doradcy Finansowi
Sp. z o.o. amounted to PLN 12,597 million as at December 31st 2011
(91% of total assets).
As at the end of December 2011, Pioneer Pekao TFI had 1,020 thousand
open customer accounts and managed portfolios of 34 funds and sub-funds.
The net asset value of the mutual funds managed by Pioneer
Pekao TFI S.A. is presented in the table below.
(PLN million)
Net asset value

bond and money market funds
equity funds
balanced funds
31.12.2011
31.12.2010
13,780.9
6,537.7
2,756.6
4,486.6
18,058.8
6,548.8
4,590.6
6,919.4
Pekao Pioneer Powszechne Towarzystwo Emerytalne S.A.

Pekao Pioneer PTE
Pekao Pioneer PTE is the management company of an open-end pension
fund (Pekao OFE), in which pension contributions are pooled and invested
with the aim of their distribution to unit holders after they reach retirement age.
As at December 31st 2011, the number of open-end pension fund
members was 344.5 thousand, down by 1.4% relative to December
31st 2010. The number of persons with at least one contribution credited
to their accounts was 334.9 thousand.
As at the end of 2011, the pension funds net asset value was
PLN 3,387.7 million, only slightly less than as at the end of 2010 despite
the unfavourable market situation caused by the debt crisis. As at the end
of 2011, Pekao OFE held a1.5% share in the market of open-end pension funds, largely in line with the result reported at the end of 2010.
54
In 2011, the company concluded 9,644 new agreements. The value

of leased assets stood at PLN 1,460 million, with 67.0% of the leased
assets being vehicles, 32.1% plant and equipment, and 0.9% other
assets.
Under an arrangement providing for mutual cooperation between the
company and Bank Pekao S.A. in the area of sale, the value of assets
leased via the Banks branches amounted to PLN 834.2 million, which
accounts for 57.1% of the companys total sales and is an 11% improvement in comparison with the previous year.
Other Financial Services

Centrum Kart S.A. CK S.A.
The company provides comprehensive services in the area of maintenance of payment card management systems, authorisation of transactions, and card personalisation.
In 2011, CK S.A. continued important IT projects which are required in
order to support expansion of the range of products offered by Bank
Pekao S.A. The company completed certification processes (on the side
of the card issuer) with Visa and Mastercard with respect to contactless
cards. Additionally, solutions were launched to enable transactions with
contactless cards (including also those issued by other issuers) at POS
terminals of Bank Pekao S.A.
2011 saw the commencement of services related to prepaid cards for
corporate clients of Bank Pekao S.A. as well as work on implementation of modern products for the merchant acquirer business. Once these
projects are completed, CK S.A. will be able to offer aeven wider range of
modern products and services to clients of Bank Pekao S.A.
Pekao Faktoring Sp. z o.o. Pekao Faktoring
The company, apart from the full range of factoring services (recourse
and non-recourse factoring), offers related assistance, such as collecting
information on debtors standing, payments collection, debt recovery,
settlements accounting and monitoring of payments on an ongoing basis.
Additionally, Pekao Faktoring offers settlement of bulk transactions,
financial advisory and consulting services regarding selection of business
financing methods, as well as extending factoring-related loans. The company cooperates with Bank Pekao S.A. in developing new sales channels
and enhancing sales through the existing ones.
In 2011, the business volume of Pekao Faktoring increased by 23.9%
year on year, while the business volume on the factoring services market
as awhole went up by 20%. The company ranks fourth on the Polish

factoring market, with a10.3% market share.
Pekao Financial Services Sp. z o.o. PFS
The company acts as atransfer agent for all participants of the asset
management market, i.e. mutual funds, pension funds and employee
pension plans.
In 2011, the company strengthened its standing on the Polish market
of transfer agents, holding on to its position of leader in the segment of
services provided to open-end pension funds (over 62% share in terms of
net asset value in the market of open-end pension funds using services of
external transfer agents).
As at the end of 2011, PFS maintained 3.3 million mutual and pension
fund accounts, a2.5% increase in comparison with 2010.
Xelion. Doradcy Finansowi Sp. z o.o. Xelion
The company focuses on serving affluent clients, who require ahighly
individualised service.
In 2011, the company focused its efforts on further development of its
product range, taking into account the climate prevailing on financial markets and current market trends. Another step in the companys strategic
development was obtaining abrokerage licence on October 18th 2011.
The brokerage services will be launched in the first quarter of 2012, and
will allow Xelion to provide its clients with amore comprehensive product
offering.
As at the end of 2011, Xelions customers had access to the products
and services of 13 domestic and foreign mutual fund management companies (including 64 domestic funds, 70 foreign funds offered by
Polish management companies and 173 foreign funds managed by foreign management companies as well as 9 asset management strategies),
5 insurance companies offering property and life insurance and
7 products of unit-linked type with 200 insurance capital funds.
Despite the unfavourable market conditions, the value of assets under
administration of Xelion remained at asimilar level as in 2010 and
amounted to ca. PLN 1.6 billion.
55
58
Structure of the Consolidated Statement

of Financial Position Short Version
58
Assets59
Equity and Liabilities
60
Off-Balance-Sheet Items
62
Net Profit Structure
Financial Results of Bank Pekao S.A.
Results of Key Related Companies
63
64
64
Consolidated Income Statement Presentation Form

Operating Income
Operating Costs
Net Impairment Losses
Provisions, Deferred Tax Assets and Liabilities
65
66
66
67
67
Quarterly Consolidated Income Statement

Consolidated Income Statement Long Form
Consolidated Statement of Comprehensive Income
Reconciliation of Consolidated Income Statement
Presentation Form and Long Form
68
68
72
73
74
57

The Bank Pekao S.A. Group plans to concentrate its activities on the
Polish market and therefore it commenced aprocess to sell its whole
exposure equity interest in PJSC UniCredit of Ukraine.
The consolidated income statement for the period from January 1st to
December 31st 2011 and from January 1st to December 31st 2010
was presented in the Consolidated Financial Statements of the Bank
Pekao S.A. Group for the year ended December 31st 2011.
The Report on activities of the Bank Pekao S.A. Group includes the short
version of the statement of financial position and the income statement
in the presentation form as well as adiscussion of selected key items of
these statements. Additionally, in order to ensure comparability of data,
the quarterly consolidated income statement for four quarters of 2011

and four quarters of 2010 was provided.
In the Consolidated Financial Statements of the Bank Pekao S.A. Group
for the year ended December 31st 2011 and in the Consolidated
December 31st 2010, the entire investment in PJSC UniCredit Bank,
comprising the subsidiarys assets and liabilities, was classified as held
for sale, and the relevant items of the income statement were presented
as discontinued operations.
Items of the income statement for 2011 and 2010 in the presentation
form include discontinued operations.
Structure of the Consolidated Statement of Financial Position Short Version

The total assets and the structure of assets and liabilities of the Group are determined by total assets of Bank Pekao S.A., which represented 97.1% of
the Groups total assets as at the end of 2011.
The tables below present the short version of the Groups statement of financial position.
31.12.2011
ASSETS
Cash and due from Central Bank

Loans and advances to banks*
Loans and advances to customers**
Securities***
Investments in associates
Property, plant and equipment and intangible assets
Other assets****
Total assets
31.12.2010
PLN MILLION
STRUCTURE
PLN MILLION
STRUCTURE
CHANGE
4,886.1
5,586.4
95,678.9
29,969.3
186.3
2,476.3
7,806.8
3.3%
3.8%
65.3%
20.4%
0.1%
1.7%
5.4%
100.0%
5,969.1
6,262.0
80,839.7
31,380.8
214.6
2,519.0
6,904.7
134,089.9
4.5%
4.7%
60.3%
23.4%
0.2%
1.9%
5.0%
100.0%
(18.1%)
(10.8%)
18.4%
(4.5%)
(13.2%)
(1.7%)
13.1%
9.3%
* Including net investments in financial leases to banks.

** Including debt securities eligible for rediscounting at Central Bank and net investments in financial leases to customers.
*** Including financial assets held for trading and other financial instruments at fair value through profit and loss.
**** Other assets include the Banks investment in PJSC UniCredit Bank in Ukraine, asubsidiary, classified as held for sale. Detailed information concerning assets and liabilities held for sale is
presented in Note 32 to the Consolidated Financial Statements of the Bank Pekao S.A. Group for the year ended December 31st 2011 Assets and liabilities held for sale and discontinued
operations.
31.12.2011
EQUITY AND LIABILITIES
Amounts due to Central Bank

Amounts due to other banks
Debt securities issued
Other liabilities
Total equity, including
non-controlling interests
Total equity and liabilities
58
31.12.2010
PLN MILLION
STRUCTURE
PLN MILLION
STRUCTURE
CHANGe
356.4
5,544.2
108,437.0
3,043.9
7,851.7
21,356.9
85.5
146,590.1
0.2%
3.8%
74.0%
2.1%
5.3%
14.6%
0.1%
100.0%
728.0
6,913.1
99,807.2
1,177.2
5,207.4
20,257.0
82.9
134,089.9
0.5%
5.2%
74.4%
0.9%
3.9%
15.1%
0.1%
100.0%
(51.0%)
(19.8%)
8.6%
158.6%
50.8%
5.4%
3.1%
9.3%
Assets
Changes in the Structure of Assets
Loans and advances to customers and securities represent items of the
largest value under assets. As at the end of 2011, they accounted for
65.3% and 20.4% of the balance-sheet total, respectively, while as at the
end of 2010, the respective figures were 60.3% and 23.4%.
Cash and Due from Central Bank
(PLN million)
31.12.2011 31.12.2010
CHANGE
Cash and due from Central Bank,

including:
4,886.1
5,969.1
Cash
Current account at Central Bank
Other
2,236.2
2,005.8
644.1
2,471.9
(9.5%)
3,495.5
(42.6%)
1.7 37,788.2%
(18.1%)
Customers Financing
Structure of Loans and Advances by Customer Segment
Loans and advances at nominal value

Loans*
Retail
Corporate
Non quoted securities
Reverse repo transactions
Other**
Nominal value adjustment
Impairment losses
Total net receivables
Securities issued by local governments***
Total customers financing****
(PLN million)
31.12.2011
31.12.2010
CHANGE
100,027.0
92,562.5
36,733.5
55,829.0
5,681.6
1,782.9
350.5
(75.6)
(4,623.0)
95,678.9
621.3
100,648.3
85,114.9
81,124.2
31,545.7
49,578.5
2,579.1
1,411.6
220.0
(261.5)
(4,233.7)
80,839.7
84.2
85,199.1
17.5%
14.1%
16.4%
12.6%
120.3%
26.3%
59.3%
(71.1%)
9.2%
18.4%
637.9%
18.1%
* Including debt securities eligible for rediscounting at Central Bank and net investments in financial leases to customers.
** Including interest and receivables in transit.
*** Securities issued by local governments classified as securities available for sale.
****Total customers financing includes loans and advances at nominal value and securities issued by local governments.
As at the end of 2011, the volume of retail loans amounted to

PLN 36,733.5 million, an increase of PLN 5,187.8 million (16.4%) in
comparison with the end of 2010. The growth in retail loan volumes was
driven by improving dynamics in sales of key lending products. Thanks
to commercial focus, in 2011 the Banks sales of new consumer loans
increased by 18% and sales of new PLN mortgage loans were higher by
almost 27% compared with 2010.
The Bank continued its policy of offering only PLN mortgage loans.
The residual stock of mortgage loans denominated in foreign currencies,
almost entirely acquired as aresult of the merger with the spun-off part
of Bank BPH SA, represents 6.5% of the Banks total loans.
The volume of corporate loans, non quoted securities, reverse repo
transactions and securities issued by local governments increased by
PLN 10,261.4 million (19.1%) relative to the end of 2010 and amounted
to PLN 63,914.8 million as at the end of 2011.
Receivables and Impairment Losses
(PLN million)
31.12.2011
31.12.2010
CHANGE
Gross receivables*
not impaired
Impaired
99,960.7
93,641.0
6,319.7
84,858.6
79,144.3
5,714.3
17.8%
18.3%
10.6%
Impairment losses
(4,623.0)
(4,233.7)
9.2%
Interest
Total net receivables
341.2
95,678.9
214.8
80,839.7
58.8%
18.4%
* Including debt securities eligible for rediscounting at Central Bank, net investments in financial leases to customers, non quoted securities, reverse repo and buy-sell-back transactions.
As at December 31st 2011, the ratio of impaired receivables to total

receivables amounted to 6.3%, which means an improvement of 0.4 pp
in relation to the end of 2010.
Impairment loss provisions as at the end of December 2011 amounted to
PLN 4,623.0 million.
59
Statement of Financial Position and Financial Results (cont.)
Loans and Advances to Customers by Currency*

31.12.2011
denominated in PLN
denominated in foreign currencies**
Total
Impairment losses
Total net
31.12.2010
PLN MILLION
STRUCTURE
PLN MILLION
STRUCTURE
CHANGE
77,550.8
22,751.1
100,301.9
(4,623.0)
95,678.9
77.3%
22.7%
100.0%
x
x
66,039.8
19,033.6
85,073.4
(4,233.7)
80,839.7
77.6%
22.4%
100.0%
x
x
17.4%
19.5%
17.9%
9.2%
18.4%
* Including interest and receivables in transit.

** Including indexed loans.
The currency structure of loans and advances to customers is dominated by amounts expressed in the Polish zoty; as at the end of December 2011,
their share was 77.3%. The largest portion of foreign currency loans and advances to customers was represented by those denominated in
EUR (55.5%), CHF (31.6%) and USD (12.6%).
Loans and Advances to Customers by Contractual Maturities
31.12.2011
Current and up to 1 month

1 to 3 months
3 months to 1 year
1 to 5 years
Over 5 years
Other*
Total
Impairment losses
Total net
31.12.2010
PLN MILLION
STRUCTURE
PLN MILLION
STRUCTURE
CHANGE
15,768.7
3,580.0
9,872.4
32,308.5
38,421.8
350.5
100,301.9
(4,623.0)
95,678.9
15.7%
3.6%
9.8%
32.3%
38.3%
0.3%
100.0%
x
x
14,195.5
3,353.7
12,428.4
25,987.1
28,888.7
220.0
85,073.4
(4,233.7)
80,839.7
16.7%
3.9%
14.6%
30.5%
34.0%
0.3%
100.0%
x
x
11.1%
6.7%
(20.6%)
24.3%
33.0%
59.3%
17.9%
9.2%
18.4%
* Including interest and receivables in transit.
Loans and advances to customers with maturities over 5 years represent

38.3% of total loans and advances (mainly attributable to mortgage loans
and receivables for which the maturity date already passed).
Information on loan concentration is included in Notes to the Consolidated
December 31st 2011.
Equity and Liabilities

Changes in the Structure of Equity and Liabilities
Amounts due to customers were the main item under the Groups equity
and liabilities. As at the end of 2011, amounts due to customers totalled
PLN 108,437.0 million, and their share in total equity and liabilities was
74.0%, compared with 74.4% as at the end of 2010. The share of total
shareholders equity in the total equity and liabilities was 14.6% as at the
end of 2011, compared with 15.1% as at the end of 2010.
60
External Sources of Financing
Amounts due to Central Bank

Total external sources of financing
(PLN million)
31.12.2011
31.12.2010
CHANGE
356.4
5,544.2
108,437.0
3,043.9
117,381.5
728.0
6,913.1
99,807.2
1,177.2
108,625.5
(51.0%)
(19.8%)
8.6%
158.6%
8.1%
In addition to customer deposits and funds borrowed on the interbank

market, Bank Pekao S.A. also has arefinancing loan taken out from the
National Bank of Poland for the financing of acredit facility granted to
fund acentral state investment project.
Bank Pekao S.A. acquires deposits mainly in Poland. As at the end of

2011, the geographical structure of deposits acquired through the Banks
domestic branches was as follows:
REGION
Warszawski
Centralny
Maopolski
Mazowiecki
Poudniowo-Wschodni
Dolnolski
Zachodni
Wielkopolski
lski
Pomorski
Total
The Groups deposit base is widely diversified, with the majority of the
deposits sourced from retail and corporate customers. The Group is not
dependent on any single customer or group of customers.
% OF TOTAL DEPOSITS
31.0%
20.9%
9.7%
9.0%
7.5%
5.4%
4.3%
4.2%
4.1%
3.7%
100.0%
Total Customer Savings
(PLN million)
Amounts due to corporate

non-financial entities
non-banking financial entities
budget entities
Retail deposits
Repo and sell-buy-back transactions
Other
Structured certificates of deposit (SCD)
Certificates of deposits (CD)
Total amounts due to customers (including repo and sell-buy-back transactions, SCDs, and CDs)*
Investment funds of Pioneer Pekao TFI
including investment funds distributed through the Groups network
31.12.2011
31.12.2010
CHANGE
55,509.6
40,890.8
9,241.3
5,377.5
47,643.7
4,609.7
674.0
108,437.0
1,119.0
1,271.1
110,153.1
13,780.9
12,597.0
53,078.1
39,166.9
8,820.2
5,091.0
45,600.8
649.9
478.4
99,807.2
737.3
100,066.1
18,058.8
16,605.7
4.6%
4.4%
4.8%
5.6%
4.5%
609.3%
40.9%
8.6%
51.8%
x
10.1%
(23.7%)
(24.1%)
* Excluding other liabilities (interest and funds in transit).
As at the end of December 2011, the total amounts due to the Groups
customers (including customer deposits, repo and sell-buy-back transactions, structured certificates of deposit, and certificates of deposits)
amounted to PLN 110,153.1 million, an increase of PLN 10,087.0 million
(10.1%) in comparison with the end of 2010.
The total volume of retail customer deposits and structured certificates of
deposit amounted to PLN 48,762.7 million as at the end of 2011, an increase of PLN 2,424.6 million (5.2%) in comparison with the end of 2010.
The value of net assets of investment funds managed by Pioneer Pekao

TFI S.A. amounted to PLN 13,780.9 million as at the end of 2011,
adecrease of PLN 4,277.9 million (23.7%) in comparison with the end of
2010, caused by the unfavourable situation prevailing on capital markets.
The total volume of corporate customer deposits, repo and sell-buy-back
transactions and certificates of deposits amounted to PLN 61,390.4 million as at the end of 2011, an increase of PLN 7,662.4 million (14.3%) as
compared with the end of 2010.
61
Amounts Due to Customers by Currency*

31.12.2011
denominated in PLN
denominated in foreign currencies
Total
31.12.2010
PLN MILLION
STRUCTURE
PLN MILLION
STRUCTURE
CHANGE
89,560.0
18,877.0
108,437.0
82.6%
17.4%
100.0%
84,794.8
15,012.4
99,807.2
85.0%
15.0%
100.0%
5.6%
25.7%
8.6%
* Including interest and amounts due in transit.
The bulk of amounts due to customers are denominated in the Polish

currency. Their share as at the end of December 2011 amounted to
82.6%. The majority of amounts due to customers denominated in foreign

currencies were in EUR (48.1%) and USD (43.5%).
Amounts Due to Customers by Contractual Maturities

31.12.2011
Current accounts and overnight deposits

Term deposits
Total deposits
Interest accrued
Funds in transit
Total
31.12.2010
PLN MILLION
STRUCTURE
PLN MILLION
STRUCTURE
CHANGE
48,703.8
59,059.2
107,763.0
316.2
357.8
108,437.0
45.2%
54.8%
100.0%
x
x
x
51,706.5
47,622.3
99,328.8
231.4
247.0
99,807.2
52.1%
47.9%
100.0%
x
x
x
(5.8%)
24.0%
8.5%
36.6%
44.9%
8.6%
OffBalance-Sheet Items
Statement of Off-Balance-Sheet Items
Contingent liabilities granted and received

Liabilities granted:
financial
guarantees
Liabilities received:
financial
guarantees
Derivative financial instruments
currency transactions
interest rate transactions
securities transactions
Other
Total off-balance sheet items
More detailed information on off-balance-sheet items is included in Notes

to the Consolidated Financial Statements of the Bank Pekao S.A. Group
for the year ended December 31st 2011.
62
(PLN million)
31.12.2011
31.12.2010
CHANGE
51,290.3
35,290.6
26,812.1
8,478.5
15,999.7
3,367.5
12,632.2
216,678.1
94,074.1
120,623.4
1,980.6
29,211.9
297,180.3
48,993.1
33,284.7
24,698.6
8,586.1
15,708.4
3,075.9
12,632.5
164,916.4
71,210.8
91,154.5
2,551.1
28,182.4
242,091.9
4.7%
6.0%
8.6%
(1.3%)
1.9%
9.5%
(0.0%)
31.4%
32.1%
32.3%
(22.4%)
3.7%
22.8%
Net Profit Structure

The structure of the net profit of the Group is shown in the following table:
Net profit of Bank Pekao S.A.

Entities consolidated under full method
PJSC UniCredit Bank*
Centralny Dom Maklerski Pekao S.A.
Pekao Leasing Sp. z o.o.**
Pekao Pioneer PTE S.A.
Pekao Faktoring Sp. z o.o.
Pekao Financial Services Sp. z o.o.
Pekao Leasing Holding S.A.***
Centrum Kart S.A.
Centrum Bankowoci Bezporedniej Sp. z o.o.
Pekao Fundusz Kapitaowy Sp. z o.o.
Pekao Telecentrum Sp. z o. o.
Holding Sp. z o.o. w likwidacji (in liquidation)
Entities valued under the equity method
Pioneer Pekao Investment Management S.A.
Krajowa Izba Rozliczeniowa S.A.
Xelion. Doradcy Finansowi Sp. z o.o.
Central Poland Fund LLC
Pirelli Pekao Real Estate Sp. z o.o.
Exclusions and consolidation adjustments****
Net profit of the Group attributable to equity holders of the Bank
(PLN million)
2011
2010
CHANGE
2,826.4
2,552.0
10.8%
57.7
46.0
42.0
17.3
12.0
10.7
7.4
3.8
3.7
3.7
1.3
0.4
(0.1)
37.0
51.5
4.8
17.5
12.4
11.3
9.8
16.1
4.6
1.1
2.8
0.3
0.3
55.9%
(10.7%)
775.0%
(1.1%)
(3.2%)
(5.3%)
(24.5%)
(76.4%)
(19.6%)
236.4%
(53.6%)
33.3%
x
62.3
10.9
0.7
0.0
(3.9)
(202.9)
2,899.4
57.1
8.4
0.8
0.5
0.3
(263.4)
2,525.2
9.1%
29.8%
(12.5%)
(100.0%)
x
(23.0%)
14.8%
* On February 8th 2011, the legal form of OJSC UniCredit Bank Ukraine was changed from open joint stock company to public joint stock company, and currently the banks full name is Public
Joint Stock Company UniCredit Bank.
In the Consolidated Financial Statements of the Bank Pekao S.A. Group for the year ended December 31st 2011 and in the Consolidated Financial Statements of the Bank Pekao S.A. Group
for the year ended December 31st 2010, the entire investment in PJSC UniCredit Bank, comprising the subsidiarys assets and liabilities, was classified as held for sale, whereas the relevant
positions of the income statement were presented as discontinued operations.
** The 2010 result of Pekao Leasing Sp.z o.o. includes the effect of adjustments to VAT liabilities relating to the period from December 2005 to April 2010, resulting from the resolution of the
Supreme Administrative Court of November 8th 2010 (I FPS 3/10) concerning VAT on reinvoicing of the leased assets insurance costs, which has adverse effects for the leasing industry.
*** The 2010 result of Pekao Leasing Holding S.A. mainly includes the dividend received from Pekao Leasing Sp. z o.o.
**** Includes transactions within the Group (including dividends from subsidiaries for the previous year) and net profit attributable to non-controlling interest.
63
Financial Results of Bank Pekao S.A.

The main items of the Banks income statement in the presentation form are as follows:
Net interest income*

Dividend income
Total net interest income and dividend income
Net non-interest income
Operating income
Operating costs
Operating profit
Net result on other provisions
Net result on investment activities
Profit before tax
Net profit for the period
(PLN million)
2011
2010
CHANGE
4,354.3
195.7
4,550.0
2,691.3
7,241.3
(3,366.3)
3,875.0
(5.1)
(497.9)
77.5
3,449.5
2,826.4
3,900.9
255.4
4,156.3
2,607.6
6,763.9
(3,336.4)
3,427.5
(27.7)
(449.9)
128.4
3,078.3
2,552.0
11.6%
(23.4%)
9.5%
3.2%
7.1%
0.9%
13.1%
(81.6%)
10.7%
(39.6%)
12.1%
10.8%
* Including income from swap transactions.
In 2011, the Banks net profit amounted to PLN 2,826.4 million, an

increase of PLN 274.4 million (10.8%) in comparison with 2010.
operating costs kept under control (growth of only 0.9%, well below the
inflation rate).
The good results for 2011, with the operating profit higher by 13.1%
relative to 2010, were driven mainly by the higher operating income with
The main items of the Banks statement of financial position are as follows:
Total gross loans in PLN million*

Impaired receivables to total receivables in %
Total deposits in PLN million*
Repo and sell-buy-back transactions in PLN million
Structured certificates of deposit in PLN million
Certificates of deposit in PLN million
Total assets in PLN million
Investment funds distributed through the Banks network in PLN million
Capital adequacy ratio in %
31.12.2011
31.12.2010
CHANGE
88,785.3
6.0%
102,730.4
4,609.7
1,119.0
1,271.1
142,390.0
11,634.1
16.6%
77,100.7
6.4%
98,199.4
649.9
737.3
130,125.1
15,125.9
17.2%
(0.4),p.p.
4.6%
609.3%
51.8%
x
9.4%
(23.1%)
(0.6),p.p.
15.2%
* The nominal value.
The value of net assets of investment funds managed by Pioneer

Pekao TFI S.A. and distributed by the Banks network decreased by
PLN 3,491.8 million (23.1%) compared with the end of 2010
as aresult of the unfavourable situation prevailing on capital markets.
The volume of gross loans of the Banks customers as at the end of

December 2011 amounted to PLN 88,785.3 million, having increased by
PLN 11,684.6 million (15.2%) compared with the end of 2010. As at the
end of December 2011, the total volume of retail loans amounted to
PLN 35,730.3 million and the volume of corporate loans was
PLN 53,055.0 million.
Results of Key Related Companies
Total amounts due to the Banks customers (including customer deposits,

repo and sell-buy-back transactions, structured certificates of deposit, and
certificates of deposits) amounted to PLN 109,730.2 million and increased
by PLN 10,143.6 million (10.2%) compared with the end of 2010.
Pioneer Pekao Investment Management S.A. PPIM

The companys consolidated net profit amounted to PLN 127.2 million in
2011 and was 9.2% higher than in 2010. The Banks share in the profit
was PLN 62.3 million.
64
PJSC UniCredit Bank UniCredit Bank

The company reported anet profit of PLN 57.7 million for 2011, up
from PLN 37.0 million in 2010 thanks to credit portfolio stabilisation and
effective cost control.
to April 2010, resulting from the resolution of the Supreme Administrative

Court of November 8th 2010 (I FPS 3/10) concerning VAT on reinvoicing
of the leased assets insurance costs, which has adverse effects for the
leasing industry.
Centralny Dom Maklerski Pekao S.A. CDM

In 2011, CDM made anet profit of PLN 46.0 million, in comparison with
PLN 51.5 million in 2010. The most important factors that influenced the
companys financial results in 2011 were the unfavorable situation on the
financial markets and implementation of MiFID, constraining the possibility of managing clients funds and limiting income from this source.
Pekao Bank Hipoteczny S.A. Pekao Bank Hipoteczny

The company generated anet profit of PLN 17.3 million in 2011 in
comparison with PLN 17.5 million in 2010.
Pekao Leasing Sp. z o.o. Pekao Leasing

In 2011, the company posted anet profit of PLN 42.0 million (the Banks
share equaled to PLN 36.7 million) compared with PLN 4.8 million in
2010. The 2010 result of Pekao Leasing Sp.z o.o. includes the effect of
adjustments to VAT liabilities relating to the period from December 2005
Xelion. Doradcy Finansowi Sp. z o.o. Xelion

In 2011, the company reported anet profit of PLN 1.4 million (the Banks
share equaled to PLN 0.7 million), compared with the net profit of
PLN 1.6 million in 2010. In spite of the unfavourable market situation, the
value of assets under administration of Xelion remained at asimilar level
as in 2010 and amounted to ca. PLN 1.6 billion. Decrease in the net profit
resulted from additional expenses incurred in connection with applying for
abrokerage licence.

The Bank Pekao S.A. Group reported solid financial results for 2011, with
net profit attributable to equity holders amounting to PLN 2,899.4 million,
which means an increase of PLN 374.2 million (14.8%) in comparison
with 2010.
The sound results for 2011 with the operating profit higher by 13.8% in
comparison with 2010, were driven mainly by higher operating income
with operating costs kept under control (growth of only 0.6%, well below
the inflation rate.
The strength of the capital and liquidity structure of the Bank Pekao S.A.
Group is reflected in the capital adequacy ratio of 17.0% and net loans to deposits ratio at the level of 88.2% at the end of December 2011. This provides
abasis for further sound and stable development of the Groups activities.
Consolidated Income Statement Presentation Form:

Dividend income and income from equity investments
Total net interest income, dividend income and other income from equity investments
Net fee and commission income
Trading result
Net other operating income and expenses
Operating income
Operating costs
Operating profit
Profit before tax
Income tax expense
Attributable to equity holders of the Bank
Attributable to non-controlling interest
(PLN million)
2011
2010
CHANGE
4,644.0
80.3
4,724.3
2,448.9
491.4
66.7
3,007.0
7,731.3
(3,671.7)
4,059.6
(5.8)
(537.9)
77.1
3,593.0
(683.9)
2,909.1
2,899.4
9.7
4,226.9
76.1
4,303.0
2,368.0
480.7
66.3
2,915.0
7,218.0
(3,649.1)
3,568.9
(50.7)
(537.9)
121.2
3,101.5
(571.2)
2,530.3
2,525.2
5.1
9.9%
5.5%
9.8%
3.4%
2.2%
0.6%
3.2%
7.1%
0.6%
13.8%
(88.6%)
0.0%
(36.4%)
15.8%
19.7%
15.0%
14.8%
90.2%
* Including income from swap transactions.
65
Operating Income
In 2011, the Groups operating income amounted to PLN 7,731.3 million,
an increase of PLN 513.3 million (7.1%) in comparison with 2010, with
growth reported in total net interest income, dividend income and income
from equity investments as well as net non-interest income, including in
particular net fee and commission income.
Total Net Interest Income, Dividend Income and Income from Equity
Investments
(PLN million)
Interest income
Interest expense
Income from swap transactions
Net interest income
Dividend income
Income from equity investments
Total net interest income, dividend
income and income from equity
investments
2011
2010
CHANGE
7,404.2
(2,846.3)
86.1
4,644.0
10.3
70.0
6,551.2
(2,447.5)
123.2
4,226.9
7.9
68.2
13.0%
16.3%
(30.1%)
9.9%
30.4%
2.6%
4,724.3
4,303.0
9.8%
Total net interest income, dividend income and income from equity investments in 2011 amounted to PLN 4,724.3 million and increased by
PLN 421.3 million (9.8%) in comparison with 2010. The increase was
driven mainly by higher volumes as well as efficient management of
interest margin.
Net Non-Interest Income
(PLN million)
2011
2010
CHANGE
Fee and commission income

Fee and commission expense
Trading result*
Net other operating income and
expense
2,934.1
(485.2)
2,448.9
491.4
2,796.3
(428.3)
2,368.0
480.7
4.9%
13.3%
3.4%
2.2%
66.7
66.3
0.6%
3,007.0
2,915.0
3.2%
* Excluding income from swap transactions.
The Groups net non-interest income in 2011 amounted to

PLN 3,007.0 million, which means an increase of PLN 92.0 million
(3.2%) in comparison with 2010, mainly as aresult of higher net fee
and commission income as well as improved trading result.
66
The table below presents the Groups net fee and commission income by
main areas of the activity.
(PLN million)

loans related
cards related
capital market related
other
2011
2010
CHANGE
2,448.9
640.1
418.2
406.6
984.0
2,368.0
496.1
439.1
430.3
1,002.5
3.4%
29.0%
(4.8%)
(5.5%)
(1.8%)
The Groups net fee and commission income in 2011 amounted to

PLN 2,448.9 million and was higher by PLN 80.9 million (3.4%) in comparison with 2010, mainly thanks to high growth in commissions related
to loans.
Operating Costs
In 2011, the operating costs were kept under control and amounted to
PLN 3,671.7 million. They were higher than the operating costs in 2010
only by PLN 22.6 million (0.6%), well below the inflation rate. Operating
costs excluding payments and fees to the Banking Guarantee Fund (BGF)
and fees to the Financial Supervision Authority (KNF) were lower by
PLN 27.5 million (0.8%) compared with 2010.
(PLN million)
2011
2010
CHANGE
Personnel expenses
Other administrative expenses
(excl. BGF and KNF)
(1,946.1)
(1,950.3)
(0.2%)
(1,238.2)
(1,247.3)
(0.7%)
Depreciation and amortization

Operating costs
(excl. BGF and KNF)
(377.5)
(391.7)
(3.6%)
(3,561.8)
(3,589.3)
(0.8%)
(109.9)
(3,671.7)
(59.8)
(3,649.1)
83.8%
0.6%
BGF and KNF

Operating costs
In 2011, the cost/income ratio amounted to 47.5% and was better by

3.1 pp than reported in 2010.
As at the end of December 2011, the Bank Pekao S.A. Group employed
20,357 staff (at the Bank and the companies consolidated under the full
consolidation method) as compared with 20,783 employees as at the end
of 2010.
As at the end of December 2011, the Bank employed 17,921 people,
areduction by 355 compared with the end of 2010.
Net Impairment Losses

In 2011, net impairment losses on loans and off-balance sheet commitments amounted to PLN 537.9 million, which is alevel similar to that reported
for 2010.
(PLN million)
Impairment losses on loans

Impairment losses on off-balance sheet commitments
Total
2011
2010
CHANGE
(556.3)
18.4
(537.9)
(544.6)
6.7
(537.9)
2.1%
174.6%
0.0%
Provisions, Deferred Tax Assets and Liabilities
Total provisions
of which:
provisions for off-balance sheet commitments
provisions for liabilities to employees
other provisions
Deferred tax liabilities
Deferred tax assets
(PLN million)
31.12.2011
31.12.2010
CHANGE
313.9
305.9
2.6%
79.1
184.4
50.4
4.4
888.0
96.5
164.7
44.7
0.7
722.0
(18.0%)
12.0%
12.8%
528.6%
23.0%
67
68
loans and other financial receivables

off-balance sheet commitments
Net result on financial activity
financial liabilities
Operating income
Net impairment losses on financial assets and offbalance sheet commitments:
Gains (losses) on disposal of:

available for sale financial assets and held to maturity
investments
Result on fair value hedge accounting

Net result on other financial instruments at fair value
through profit and loss
Interest income
Interest expense
Net interest income
Dividend income
Result on financial assets and liabilities held for
trading
(6,997)
38,535
(6,997)
(127,185)
(159,598)
32,413
1,632,182
45,532
(64)
1,877
(418)
1,759,367
(64)
14
1,459
7,341
141,813
(4,244)
57,327
(24,314)
33,013
8,773
(3,531)
5,242
1,611,758
(583,599)
1,028,159
690,972
(98,806)
592,166
CONTINUING DISCONTINUED
OPERATIONS
OPERATIONS
Q1 2011
(166,595)
32,413
1,670,717
(134,182)
(418)
1,804,899
1,813
1,395
14
(4,244)
149,154
1,669,085
(607,913)
1,061,172
699,745
(102,337)
597,408
TOTAL
(122,887)
(8,666)
1,740,720
(131,553)
(325)
1,872,273
3,863
3,385
(153)
(153)
(3,345)
124,200
1,735,909
(637,615)
1,098,294
753,752
(114,171)
639,581
10,311
(3,235)
33,853
(3,235)
37,088
16
16
4,954
49,287
(22,156)
27,131
9,112
(4,125)
4,987
OPERATIONS
OPERATIONS
Q2 2011
(126,122)
(8,666)
1,774,573
(134,788)
(325)
1,909,361
3,879
3,401
(153)
(153)
(3,345)
129,154
1,785,196
(659,771)
1,125,425
762,864
(118,296)
644,568
10,311
Total
(127,819)
(6,251)
1,805,406
(134,070)
(288)
1,939,476
42,894
42,606
(191)
(526)
157,711
1,850,351
(716,877)
1,133,474
734,599
(128,220)
606,379
23
(3,494)
32,948
(3,494)
36,442
(1,634)
56,347
(23,658)
32,689
10,411
(5,027)
5,384
OPERATIONS
OPERATIONS
Q3 2011
(131,313)
(6,251)
1,838,354
(137,564)
(288)
1,975,918
42,897
42,609
(191)
(526)
156,077
1,906,698
(740,535)
1,166,163
745,010
(133,247)
611,763
23
Total
Q4 2011
(141,552)
953
1,794,683
(140,599)
(250)
1,935,282
28,128
27,711
(167)
(171)
(7,642)
159,380
1,981,136
(814,579)
1,166,557
716,084
(126,655)
589,429
18
9,194
55,094
9,194
45,900
(2)
287
289
1,346
62,105
(23,564)
38,541
10,352
(4,626)
5,726
(132,358)
953
1,849,777
(131,405)
(250)
1,981,182
28,126
27,998
122
(171)
(7,642)
160,726
2,043,241
(838,143)
1,205,098
726,436
(131,281)
595,155
18
Total
(PLN thousand)
OPERATIONS
OPERATIONS
Consolidated Income Statement for 2011

Provided for comparability purposes Not reviewed/audited by the independent auditor.
Consolidated Income Statement Long Form
Quarterly Consolidated Income Statement
69
784,167
(147,073)
637,094
634,511
2,583
16,617
(2,821)
13,796
13,796
415
Profit before income tax

Income tax expense
attributable to equity holders of the Bank
attributable to non-controlling interest
(9,419)
(9,633)
(2,399)
(467)
(21,918)
(480,138)
(306,069)
(93,296)
(1,428)
11,830
(869,101)
20,671
personnel expenses
other administrative expenses
Operating costs
Gains (losses) from subordinated entities
Gains (losses) on disposal of property, plant and
equipment, and intangible assets
(19,052)
(786,207)
Administrative expenses
OPERATIONS
OPERATIONS
Q1 2011
800,784
(149,894)
650,890
648,307
2,583
415
(489,557)
(315,702)
(95,695)
(1,428)
11,363
(891,019)
20,671
(805,259)
Total
868,711
(163,913)
704,798
702,359
2,439
377
(492,528)
(325,008)
(90,582)
532
16,709
(890,877)
18,491
(817,536)
13,677
(1,739)
11,938
11,938
(8,695)
(9,162)
(2,054)
(265)
(20,176)
(17,857)
OPERATIONS
OPERATIONS
Q2 2011
882,388
(165,652)
716,736
714,297
2,439
377
(501,223)
(334,170)
(92,636)
532
16,444
(911,053)
18,491
(835,393)
Total
938,603
(179,627)
758,976
756,547
2,429
73
(486,116)
(331,561)
(91,284)
173
24,904
(883,884)
17,008
(817,677)
11,155
(1,409)
9,746
9,746
(9,033)
(10,451)
(2,165)
(144)
(21,793)
(19,484)
OPERATIONS
OPERATIONS
Q3 2011
949,758
(181,036)
768,722
766,293
2,429
73
(495,149)
(342,012)
(93,449)
173
24,760
(905,677)
17,008
(837,161)
Total
Q4 2011
927,793
(177,271)
750,522
748,291
2,231
(465)
(449,713)
(353,553)
(93,305)
(5,110)
21,458
(880,223)
13,798
(803,266)
32,223
(9,997)
22,226
22,226
(10,512)
(9,991)
(2,408)
40
(22,871)
(20,503)
960,016
(187,268)
772,748
770,517
2,231
(465)
(460,225)
(363,544)
(95,713)
(5,110)
21,498
(903,094)
13,798
(823,769)
Total
(PLN thousand)
OPERATIONS
OPERATIONS
Consolidated Income Statement for 2011 cont.
70

Operating income
Net impairment losses on financial assets and offbalance sheet commitments:

available for sale financial assets and held to maturity
investments

Net result on other financial instruments at fair value
through profit and loss
Interest income
Interest expense
Net interest income
Dividend income
Result on financial assets and liabilities held for
trading
(13,168)
38,840
(13,168)
(127,723)
(130,143)
2,420
1,569,782
52,008
35,154
(19)
1,697,505
598
596
12,160
35,135
2,737
119,584
1,951
74,842
(30,623)
44,219
8,478
(4,024)
4,454
1,502,030
(541,129)
960,901
672,763
(104,989)
567,774
OPERATIONS
OPERATIONS
Q1 2010
(143,311)
2,420
1,608,622
(140,891)
(19)
1,749,513
35,156
35,733
596
12,160
1,951
122,321
1,576,872
(571,752)
1,005,120
681,241
(109,013)
572,228
Total
(127,968)
5,989
1,599,243
(121,979)
(207)
1,721,222
25,552
25,345
(351)
(8,795)
148,541
1,533,892
(569,694)
964,198
683,200
(98,624)
584,576
7,708
(14,033)
34,885
(14,033)
48,918
792
791
5,935
72,712
(34,388)
38,324
8,437
(4,570)
3,867
OPERATIONS
OPERATIONS
Q2 2010
(142,001)
5,989
1,634,128
(136,012)
(207)
1,770,140
25,553
26,137
791
(351)
(8,795)
154,476
1,606,604
(604,082)
1,002,522
691,637
(103,194)
588,443
7,708
Total
(110,523)
(1,688)
1,654,879
(112,211)
(282)
1,767,090
46,633
46,351
1,757
12,476
129,430
1,584,131
(590,485)
993,646
682,209
(98,960)
583,249
181
(21,477)
36,941
(21,477)
58,418
353
355
2
13,385
67,890
(30,557)
37,333
11,136
(3,791)
7,345
OPERATIONS
OPERATIONS
Q3 2010
(132,000)
(1,688)
1,691,820
(133,688)
(282)
1,825,508
46,986
46,706
2
1,757
12,476
142,815
1,652,021
(621,042)
1,030,979
693,345
(102,751)
590,594
181
Total
Q4 2010
(123,985)
11
1,705,676
(123,974)
(560)
1,829,650
13,934
19,038
5,664
386
1,169
161,645
1,660,383
(624,223)
1,036,160
719,884
(108,632)
611,252
(3,363)
33,989
(3,363)
37,352
(2)
(11)
(9)
2,959
55,335
(26,442)
28,893
10,186
(4,675)
5,511
(127,348)
11
1,739,665
(127,337)
(560)
1,867,002
13,932
19,027
5,655
386
1,169
164,604
1,715,718
(650,665)
1,065,053
730,070
(113,307)
616,763
Total
(PLN thousand)
OPERATIONS
OPERATIONS

Provided for comparability purposes Not reviewed/audited by the independent auditor.
71
724,467
(131,859)
592,608
590,370
2,238
17,187
(4,845)
12,342
12,342
(100)

Income tax expense
(9,443)
(9,304)
(3,195)
289
(21,653)
(458,344)
(320,681)
(104,967)
837
17,155
(866,000)
20,785
personnel expenses
Operating costs
Gains (losses) on disposal of property, plant and
equipment, and intangible assets
(18,747)
(779,025)
OPERATIONS
OPERATIONS
Q1 2010
741,654
(136,704)
604,950
602,712
2,238
(100)
(467,787)
(329,985)
(108,162)
837
17,444
(887,653)
20,785
(797,772)
Total
753,088
(139,152)
613,936
611,452
2,484
135
(465,744)
(318,263)
(95,058)
320
13,806
(864,939)
18,649
(784,007)
10,508
(2,845)
7,663
7,663
(10,266)
(10,335)
(3,508)
(268)
(24,377)
(20,601)
OPERATIONS
OPERATIONS
Q2 2010
763,596
(141,997)
621,599
619,115
2,484
135
(476,010)
(328,598)
(98,566)
320
13,538
(889,316)
18,649
(804,608)
Total
806,320
(153,960)
652,360
649,780
2,580
84
(472,815)
(327,400)
(94,600)
441
24,519
(869,855)
21,212
(800,215)
13,447
(3,542)
9,905
9,905
(9,627)
(11,067)
(3,103)
303
(23,494)
(20,694)
OPERATIONS
OPERATIONS
Q3 2010
819,767
(157,502)
662,265
659,685
2,580
84
(482,442)
(338,467)
(97,703)
441
24,822
(893,349)
21,212
(820,909)
Total
Q4 2010
763,615
(129,145)
634,470
636,667
(2,197)
(490)
(514,253)
(308,982)
(84,584)
(52,272)
10,897
(949,194)
7,623
(823,235)
12,880
(5,825)
7,055
7,055
(9,809)
(8,317)
(2,696)
(287)
(21,109)
(18,126)
776,495
(134,970)
641,525
643,722
(2,197)
(490)
(524,062)
(317,299)
(87,280)
(52,272)
10,610
(970,303)
7,623
(841,361)
Total
(PLN thousand)
OPERATIONS
OPERATIONS
Consolidated Income Statement for 2010 cont.

for 2011 and 2010
Provided for comparability purposes Not reviewed/audited by the
independent auditor.
(PLN thousand)
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2010
Q2 2010
Q3 2010
Q4 2010
Net profit
Other comprehensive income
Foreign currency translation differences
Change in fair value of available-for-sale
financial assets
650,890
648,307
2,583
716,736
714,297
2,439
768,722
766,293
2,429
772,748
770,517
2,231
604,950
602,712
2,238
621,599
619,115
2,484
662,265
659,685
2,580
641,525
643,722
(2,197)
(11,290)
(16,131)
66,636
19,432
4,745
51,915
(49,514)
4,818
(93,470)
196,477
(116,760)
(45,088)
195,966
(168,900)
121,548
(131,294)
Change in fair value of cash flow hedges

Income tax expense on other comprehensive
income
(46,167)
18,395
9,505
(31,003)
53,329
47,808
3,548
(37,116)
29,517
(38,577)
7,740
10,507
(47,285)
23,233
(24,165)
63,713
Other comprehensive income (net)

Total comprehensive income
(121,410)
529,480
526,897
2,583
160,164
876,900
874,461
2,439
(32,879)
735,843
733,414
2,429
(46,152)
726,596
724,365
2,231
206,755
811,705
809,467
2,238
(45,944)
575,655
573,171
2,484
51,417
713,682
711,102
2,580
(99,879)
541,646
543,843
(2,197)
72

(PLN thousand)
Q1 2011
Q2 2011
Q3 2011
Q4 2011

Total net interest income, dividend income
and other income from equity investments
1,081,977
20,671
1,129,863
28,802
1,191,590
17,031
1,240,534
13,816
1,102,648
1,158,665
1,208,621
1,254,350

Trading result
Operating income
Operating costs
Operating profit
Net impairment losses on loans
and off-balance sheet commitments
597,408
123,701
9,484
730,593
1,833,241
(899,075)
934,166
(1,428)
644,568
120,893
14,619
780,080
1,938,745
(926,357)
1,012,388
532
611,763
129,645
22,408
763,816
1,972,437
(928,258)
1,044,179
173
595,155
117,227
20,176
732,558
1,986,908
(918,038)
1,068,870
(5,110)
(134,182)
(134,788)
(137,564)
(131,405)

Profit before tax
Income tax expense
2,228
800,784
(149,894)
650,890
648,307
2,583
4,256
882,388
(165,652)
716,736
714,297
2,439
42,970
949,758
(181,036)
768,722
766,293
2,429
27,661
960,016
(187,268)
772,748
770,517
2,231
* Including income from SWAP transactions.
(PLN thousand)
Q1 2010
Q2 2010
Q3 2010
Q4 2010
1,039,257
20,785
1,039,038
26,357
1,062,529
21,393
1,086,058
7,623
1,060,042
1,065,395
1,083,922
1,093,681

Trading result
Operating income
Operating costs
Operating profit
Net impairment losses on loans
572,228
102,276
16,340
690,844
1,750,886
(903,576)
847,310
837
588,443
108,607
12,507
709,557
1,774,952
(902,010)
872,942
320
590,594
125,216
23,754
739,564
1,823,486
(917,542)
905,944
441
616,763
144,594
13,652
775,009
1,868,690
(926,028)
942,662
(52,272)
(140,891)
(136,012)
(133,688)
(127,337)

Profit before tax
Income tax expense
34,398
741,654
(136,704)
604,950
602,712
2,238
26,346
763,596
(141,997)
621,599
619,115
2,484
47,070
819,767
(157,502)
662,265
659,685
2,580
13,442
776,495
(134,970)
641,525
643,722
(2,197)

Total net interest income, dividend income
and other income from equity investments
* Including income from SWAP transactions.
73
Reconciliation of Consolidated Income Statement Presentation Form and Long Form

INCOME STATEMENT PRESENTATION FORMS
ITEMS
(PLN thousand)
LONG FORMS ITEMS RECLASSIFFIED TO PRESENTATION FORM
Net interest income

Net interest income
Income from SWAP transactions
Dividend income and income from equity
investments
Total net interest income, dividend income and

other income from equity investments

less Refunding of administrative expenses
(Gains) losses on disposal of loans and other financial receivables
Operating income
Operating costs
Personnel expenses
Refunding of administrative expenses
10,352
69,968
2,448,894
491,466
595,111
(86,106)
(15,757)
(501)
(1,281)
66,687
74,065
(7,347)
(31)
3,007,047
7,731,331
(3,671,728)
(1,946,154)
(1,355,428)
7,347
(377,493)
4,059,603
(5,833)
/1
/2
/2
(537,939)
Net impairment losses on loans and other financial receivables
Net impairment provision for off-balance sheet commitments

Gains (losses) on disposal of property, plant and equipment, and intangible assets.
Gains (losses) on disposal of available for sale financial assets and held to maturity
investments
Profit before tax
Income tax expenses
/1
4,724,284
Result on financial assets and liabilities held for trading

less Income from SWAP transactions
Net result on other financial instruments at fair value through profit and loss
(Gains) losses on disposal of financial liabilities
Operating profit
Net impairment losses on loans and off-balance
sheet commitments
COMMENTS
80,320
Dividend income

Trading result
2011
4,643,964
4,557,858
86,106
Income tax expenses

(556,388)
18,449
77,115
400
76,715
3,592,946
(683,850)
2,909,096
2,899,414
9,682
1/ In the long form the item Income from SWAP transactions included in the item Result on financial assets and liabilities held for trading, in apresentation form included in the item Net interest income.
2/ In the long form the item Refunding of administrative expenses included in the item Net other operating income/expenses, in apresentation form
included in Operating cost.
74

INCOME STATEMENT PRESENTATION FORMS
ITEMS
(PLN thousand)
LONG FORMS ITEMS RECLASSIFIED TO PRESENTATION FORM
Net interest income

Net interest income
Income from SWAP transactions
Dividend income and income from equity
investments
4,303,040
2,368,028

less Income from SWAP transactions
Net result on other financial instruments at fair value through profit and loss
(Gains) losses on disposal of financial liabilities

less Refunding of administrative expenses
Gains (losses) on disposal of loans and other financial receivables
Operating income
Operating costs
Personnel expenses
Refunding of administrative expenses
480,693
584,216
(123,208)
6,801
13,952
(1,068)
66,253
66,414
(7,205)
7,044
2,914,974
7,218,014
(3,649,156)
(1,950,301)
(1,314,349)
7,205
(391,711)
3,568,858
(50,674)
/1
/2
/2
(537,928)
Net impairment losses on loans and other financial receivables
Net impairment provision for off-balance sheet commitments

Gains (losses) on disposal of property, plant and equipment, and intangible assets.
Gains (losses) on disposal of available for sale financial assets and held to maturity
investments
Profit before tax
Income tax expenses
/1
7,889
68,269
Total net interest income, dividend income and

other income from equity investments
Operating profit
Net impairment losses on loans and off-balance
sheet commitments
COMMENTS
76,158
Dividend income

Trading result
2010
4,226,882
4,103,674
123,208
Income tax expenses

(544,660)
6,732
121,256
(371)
121,627
3,101,512
(571,173)
2,530,339
2,525,234
5,105
1/ In the long form the item Income from SWAP transactions included in the item Result on financial assets and liabilities held for trading, in apresentation form included in the item Net interest income.
2/ In the long form the item Refunding of administrative expenses included in the item Net other operating income/expenses, in apresentation form
included in Operating costs.
75
Other Information
Subsequent Events
78
Management Boards Position on the Feasibility

of Meeting Previously Published Forecasts
78
Management Boards and Supervisory Boards Remuneration
78
Incentive Programmes
79
Shares in the Bank and Related Entities Held

by Members of the Banks Statutory Bodies
79
Information Regarding Contracts for Post-Termination Benefits
79
Agreements with Companies Entitled to Audit Financial Statements
80
Average Interest Rates Applicable at Bank Pekao S.A.

in December 2011
80
Number and Value of Bank Enforcement Orders and Value

of Accepted Security
80
Pending Litigations
80
Related Party Transactions
81
Significant Agreements
81
Agreement with the Central Bank
81
Derivative Financial Instruments and Hedge Accounting
81
Accounting Policies Adopted in the Preparation of

the Consolidated Financial Statements
81
Issuance, Redemption and Repayment of Debt Securities
81
77
Other Information
Subsequent Events
There have been no material events subsequent to the balance-sheet
date.
Management Boards Position on the

Feasibility of Meeting Previously Published
Forecasts
The Bank has not published any forecast of the financial results for 2011.
Management Boards and Supervisory Boards Remuneration

The total amount of remuneration and benefits (both in cash and in kind) paid or payable to the Management Board members in 2011:
BASE SALARY AND
BONUS PAID OR
PAYABLE FOR 2011)
Alicja Kornasiewicz (until 30.04.2011)(1)

Luigi Lovaglio
Marian Wayski
Grzegorz Piwowar
Andrzej Kopyrski
Diego Biondo
Marco Iannaccone
Provisions 2011(2)
Total
OTHER BENEFITS
FOR 2011
622
3,283
817
1,154
1,823
1,621
1,444
7,810
18,574
5,665
134
20
102
109
1
1
6,032
TOTAL 2011
6,287
3,417
837
1,256
1,932
1,622
1,445
7,810
24,606
(PLN thousand)
BONUSES PAID IN
2011 RELATED TO
PRIOR YEARS
1,262
803
398
398
375
226
338
3,800
Other benefits for 2011 includes severance and compensation payments to adeparting Management Board member on the basis of the Agreement on conditions of the termination of employment contract.
(2)
Provisions 2011 includes provisions for bonuses as well as Long Term Incentive Programme, in each case with payments deferred for up to five years.
(1)
A decision on bonuses for 2011 payable to the Management Board

members has not been taken by the Supervisory Board yet.
Additionally, in 2011 the cost of the programme of stock and stock options exercisable by Management Board members subject to fulfilment of
certain conditions amounted to PLN 3,290 thousand.
For adescription of the incentive programmes refer to Notes to the Consolidated Financial Statements of the Bank Pekao S.A. Group for the year
ended December 31st 2011.
No compensation was paid or is payable for 2011 to the Management
Board members by subsidiaries, jointly controlled companies, or associated entities.
Total amount of remuneration (in cash, in kind or in any other form) paid or payable to the Supervisory Board members in 2011:
2011
Alicja Kornasiewicz (from 01.05.2011)

Jerzy Wonicki
Pawe Dangel
Oliver Greene
Enrico Pavoni
Leszek Pawowicz
Krzysztof Pawowski
Federico Ghizzoni (until 30.04.2011)
Sergio Ermotti (until 23.02.2011)
Roberto Nicastro
Alessandro Decio (from 19.04.2011)
Total
78
137
197
114
165
114
156
114
997
(PLN thousand)
COMMENTS
Did not receive remuneration according to the Groups policy

Additionally, in 2011 the cost of the programme of Bank UniCredit S.p.A.

stock and stock options exercisable by aSupervisory Board member
subject to fulfilment of certain conditions amounted to PLN 51 thousand.
No compensation was paid or is payable for 2011 to the Supervisory
Board members by subsidiaries, jointly controlled companies, or associated entities.
For adescription of the incentive programmes refer to Notes to the Consolidated Financial Statements of the Bank Pekao S.A. Group for the year
ended December 31st 2011.
Incentive Programmes
The Bank Pekao S.A. Group has an incentive programme in place as part
of which members of the governing bodies, members of the executive
staff and employees key to the implementation of the Banks strategy are
granted the right to acquire the Bank shares in accordance with the Rules
of the Incentive Programme.
As at the date of the release of this annual report, under Incentive
Programme 2004 seven persons were entitled to acquire 87,905 shares,
of which one member of the Management Board will be eligible to acquire
32,678 shares.
Bank Pekao S.A. Group, including three members of the Management

Board, participated in the Long-Term Incentive Plan 2008 and
73 employees, including two Management Board members, participated
in Long-Term Incentive Plan 2011-2013.
Shares in the Bank and

Related Entities Held by Members
of the Banks Statutory Bodies
According to information available to the Bank, as at December
31st 2011 members of the Banks management and supervisory bodies
held 40,857 shares of Bank Pekao S.A. with the par value of PLN 40,857.
The number of the Bank shares held by members of the Banks management and supervisory bodies and their par value remained unchanged as
the date of submitting of this report.
The table below presents the number of shares held by Management
Board members.
AS AT THE DATE OF SUBMITTING THE REPORT
Luigi Lovaglio
Diego Biondo
Total
FOR 2011
FOR Q3 2011
FOR 2010
31,357
9,500
40,857
31,357
9,500
40,857
31,357
9,500
40,857
Supervisory Board members did not participate in the Incentive Programme of Bank Pekao S.A.
The number of shares to be acquired by members of the Management
Board in accordance with the Rules of the Incentive Programme is presented in the table below.
AS AT THE DATE OF SUBMITTING THE REPORT
Luigi Lovaglio
Total
FOR 2011
FOR Q3 2011
FOR 2010
32,678
32,678
32,678
32,678
32,678
32,678
Moreover, as at December 31st 2011, UniCredit S.p.A. shares were

held by: Mr. Luigi Lovaglio 21,430 shares without par value, Mr. Diego
Biondo 1,551 shares without par value, Mr. Alessandro Decio
50,797 shares without par value, Mr. Marco Iannaccone 1,770 shares
without par value, Mr. Andrzej Kopyrski 384 shares without par value,
Mrs. Alicja Kornasiewicz 2,868 shares without par value, Mr. Roberto
Nicastro 81,788 shares without par value, Mr. Grzegorz Piwowar
1,499 shares without par value, and Mr. Marian Wayski 827 shares
without par value.
All the pre-emptive rights to acquire Series F shares attached to Series

aand Series B bonds, and the pre-emptive rights to acquire Series G
shares attached to Series C bonds were exercised.
Information Regarding Contracts

for Post-Termination Benefits
The pre-emptive rights to acquire Series G shares attached to Series D

bonds can be exercised in the period from January 1st 2009 to
December 31st 2012.
The employment contracts concluded by the Bank with the following

Management Board members provide for compensation equal to
18 times the monthly base salary for the last month of employment in
the event they are not re-appointed for another term of office once their
current term expires or they are removed from office:
Mr. Andrzej Kopyrski, Vice President of the Management Board,
Mr. Grzegorz Piwowar, Vice President of the Management Board,
Mr. Marian Wayski, Vice President of the Management Board.
The issue price of Series G shares is PLN 123.06.

Furthermore, as at December 31st 2011, 39 employees of the Bank
Pekao S.A. Group, including three members of the Management Board,
participated in the Long-Term Incentive Plan 2007, 55 employees of the
79
Other Information (cont.)
This does not apply in the event of dismissal pursuant to Art. 52 or Art. 53
of the Labour Code or due to improper performance of duties, or breach
of the Banks Statute or the Management Boards or Supervisory Boards
resolutions.
Moreover, the above mentioned Management Board members have
signed non-competition agreements with the Bank, setting forth the rights
and responsibilities of the parties with respect to competitive activities
during and after termination of employment with the Bank.
Employment contracts with the remaining Management Board members
do not contain any provisions concerning such compensation.
Agreements with Companies Entitled

to Audit Financial Statements
On the basis of the agreement concluded on July 8th 2010, KPMG Audyt
sp. z o.o. is the company appointed to audit and review the financial
statements of Bank Pekao S.A. and the Bank Pekao S.A. Group for
2010-2011.
Auditors remuneration for services to the Bank Pekao S.A. Group:
(PLN thousand)
Fee for the audit of annual financial statements

Fee for other attestation services,
including review of financial statements
2011
2010
4,321
3,947
3,808
2,555
The amounts above do not include value added tax.
Average Interest Rates Applicable at Bank

Pekao S.A. in December 2011
Average nominal interest rates for the basic types of PLN and foreign
currency deposits for non-financial sector residents:
PLN retail deposits
PLN corporate deposits
Total foreign currency deposits in USD
Total foreign currency deposits in EUR
1.96%,p.a.
3.73%,p.a.
0.03%,p.a.
0.15%,p.a.
Average nominal interest rates for PLN loans for non-financial sector
residents:
Total retail loans
Mortgage loans
Consumer loans
Other
Corporate loans
80
9.12%,p.a.
6.54%,p.a.
16.36%,p.a.
10.72%,p.a.
6.74%,p.a.
Number and Value

of Bank Enforcement Orders
and Value of Accepted Security
Bank Pekao S.A. has established astrict policy with regard to the types
of security accepted in respect of loans and guarantees. This policy is
reflected in the internal rules and regulations applicable at the Bank. The
Group emphasises the importance of this aspect of risk management in
relation to the effective implementation of Basel II at the Group.
The type of security and its value are carefully analysed and selected to
match the risk of each particular transaction.
The Bank follows the rule according to which the value of security should
relate directly to the value of the secured liability, that is cash provided by
the Bank to aclient (capital or amount of off-balance sheet commitment
granted by the Bank) together with collateral receivables, such as interest
or commissions.
The types of security accepted by the Bank as protection against risks
related to its lending activities include: bank guarantees, sureties under
civil law, blank promissory notes, endorsement on bills, transfer of debts,
mortgage, registered pledge, ordinary pledge, assignment by way of
security, transfer of arelevant amount to the Bank, and funds blocked in
abank account.
For corporate clients, the total value of collateral for impaired transactions
as at December 31st 2011 amounted to PLN 1,444.1 million.
In 2011, 326 enforcement orders were issued on behalf of the Bank,
in the total amount of PLN 212.9 million.
For retail clients, the total value of collateral for impaired transactions
as at December 31st 2011 amounted to PLN 558.1 million. In 2011,
45,838 enforcement orders were issued on behalf of the Bank, in the
total amount of PLN 537.1 million.
Pending Litigations
In 2011, there were 2,495 legal proceedings pending before courts, arbitration bodies or public administration authorities in respect of the Groups
liabilities, totalling PLN 18,753.3 million. The number of legal proceedings
involving receivables was 29,421; they totalled PLN 1,319.1 million.
In 2011, there were no legal proceedings relating to liabilities and/or
receivables of the Group in which asserted claims accounted for 10% or
more of the Banks equity.
In the opinion of the Bank, no proceedings pending before any court,
arbitration body or public administration authority in 2011, whether individually or in aggregate, pose any threat to the Banks financial liquidity.
Related Party Transactions

Related party transactions are described in Notes to the Consolidated
December 31st 2011.
Significant Agreements
All the pre-emptive rights to acquire Series F shares attached to Series

aand Series B bonds, and all the pre-emptive rights to acquire Series
G shares attached to Series C bonds have been exercised.
The pre-emptive rights to acquire Series G shares can be exercised
in respect of Series D bonds in the period from January 1st 2009 to
December 31st 2012.
The issue price of Series G shares is PLN 123.06.
In 2011, there were no significant agreements concluded by the Bank.
Agreement with the Central Bank

Bank Pekao S.A. uses arefinancing loan from the National Bank
of Poland for the financing of aloan granted to finance acentral
government-sponsored investment project. The loan has been repaid
quarterly since the beginning of 1999, and the final repayment date is
December 31st 2012. The loan contracted for acentral governmentsponsored project is guaranteed by the State Treasury.
Derivative Financial Instruments

and Hedge Accounting
Information on derivative financial instruments and hedge accounting
is included in Notes to the Consolidated Financial Statements of the
Bank Pekao S.A. Group for the year ended December 31st 2011.
Accounting Policies Adopted

in the Preparation of
the Consolidated Financial Statements
Accounting policies adopted in the preparation of the annual consolidated financial statements are described in Notes to the Consolidated
December 31st 2011.
Issuance, Redemption
and Repayment of Debt Securities
Structured Certificates of Deposit

Structured certificates of deposit (SCDs) are investment products for
the Banks clients that form an alternative to traditional bank deposits.
The total value of the Banks liabilities under SCDs amounted to
PLN 1,119.0 million (principal value) as at the end of December
2011. There are 15 open issues of structured certificates of deposit
in PLN, EUR and USD, with the maximum maturity date set at March
17th 2014. Liabilities maturing in 2012, 2013 and 2014 account for
47.2%, 34.6%, and 18.2% of the total liabilities under those SCDs,
respectively.
Certificates of Deposit
Certificates of deposit (CDs) are investment products denominated in
PLN that guarantee 100% protection of the invested capital, also in
case of termination before the redemption date. The total value of the
Banks liabilities under CDs amounted to PLN 1,271.1 million (principal
value) as at the end of December 2011. There are six open issues of
certificates of deposit. Certificates of deposit with the maturity date of
up to three months, up to six months, and up to one year account for
32.4%, 58.1%, and 9.5%, respectively, of the total liabilities under CDs.
Pekao Leasing Sp. z o.o. Bonds
As at December 31st 2011, the total value of the companys liabilities
under bonds, with the maturity date of up to three months, amounted
to PLN 20.5 million.
Pekao Bank Hipoteczny S.A. Mortgage Covered Bonds
As at December 31st 2011, the total value of companys liabilities
under mortgage covered bonds amounted to PLN 807.8 million.
Liabilities under mortgage covered bonds with the maturity date of up
to one year account for 38.3% of the total nominal value of the bonds,
and with the maturity date from five to ten years account for 61.7% of
the total nominal value.
Issuance of Bank Pekao S.A. Bonds

Under Resolution No. 6 of the Banks Extraordinary General Meeting
on the issue of registered bonds under an incentive programme, dated
July 25th 2003, the Bank issued registered Series aand Series B
bonds with pre-emptive rights to acquire Series F shares of the Bank,
and registered Series C and Series D bonds with pre-emptive rights to
acquire Series G shares of the Bank.
81
Basic Corporate Governance Rules
84
Compliance with the Code of Best Practice for WSE Listed Companies 84
Compliance with Applicable Standards, Laws and Regulations
84
General Meeting of Shareholders

Convening of the General Meeting
Powers of the General Meeting
Rules of Procedure
Main Rights of Shareholders
Majority Rule and Protection of the Minority
85
85
86
86
86
86
Supervisory Board
Appointment and Qualifications
Powers of the Supervisory Board
Operation of the Supervisory Board
Independent Members
Committees of the Supervisory Board
87
87
90
91
91
91
Management Board
Powers of the Management Board
Functioning of the Management Board
Management Structure
92
92
94
94
95
Risk Management System
96
Internal Control System
97
Protection of Inside Information and Prohibition

of Trading during Restricted Periods
Protection of Inside Information
Prohibition of Trading during Restricted Periods
Reporting Transactions by Obliged Persons
98
98
98
98
Relations with the External Auditor

Selection of the Auditing Firm to Audit Financial Statements
The Auditors Independence
99
99
99
Credit Process for the Management Staff

and Entities and Persons Related to the Bank
99
83
Basic Corporate Governance Rules
General corporate governance rules applicable at the Bank and the Pekao
S.A. Group are stipulated in the statutory provisions, including in particular the Commercial Companies Code and the Banking Law, capital market
regulations, the Banks Statute as well as Code of Best Practice for WSE
Listed Companies, and the UniCredit Integrity Charter.
As required under the Act on Trading in Financial Instruments of July 29th
2005, the Bank has implemented internal procedures designed to monitor the performance of obligations relating to inside information, ban on
transactions in the Banks instruments during restricted periods, and on
disclosing information on transactions in financial instruments connected
with securities issued by the Bank made by significant persons related to
the Bank.
The Compliance Department operating within the structure of the Banks
Head Office is responsible for ensuring the consistency and compliance
of the Banks internal regulations with the applicable laws, norms and
standards, and for their uniform application. The compliance risk, or the
risk of violating regulations, is directly related to apossible liability to
criminal and administrative sanctions, as well as material and financial
losses and impairment of the Banks repute on the market, with the
resulting loss of clients confidence.
In order to ensure the stability of the Pekao Group, the Bank coordinates
and controls the operations of its subsidiaries through the Banks representatives in the subsidiaries governing bodies.
Compliance with the Code of Best Practice

for WSE Listed Companies
Bank Pekao S.A. has followed the code of best practice for companies
listed on the Warsaw Stock Exchange since 2002, when the Supervisory Board of the WSE for the first time formulated aset of corporate
governance guidelines. In 2011 the Bank adhered to the principles set
out in the Code of Best Practice for WSE Listed Companies adopted by
the Supervisory Board of the WSE on May 19th 2010 in Resolution No.
17/1249/2010. The observance of the Code of Best Practice for WSE
Listed Companies does not require aformal approval of the document by
the Bank.
As stated in the Preamble, The Code of Best Practice for WSE Listed
Companies draws upon and embodies the tradition of Polish corporate
governance, whose first formal paper was the set of rules known as Best
Practices of Public Companies 2002. The Code of Best Practice for WSE
Listed Companies aims at enhancing transparency of listed companies,
improving quality of communication between companies and investors
and strengthening protection of shareholders rights, including those not
regulated by legislation.
84
Seeking to ensure compliance with the Rules of the Warsaw Stock

Exchange, the Bank as alisted company publishes astatement of
compliance with the corporate governance rules. The statement is part
of each annual report and its scope and form is consistent with the
standards set out in Resolution No. 1013/2007 of the Management Board
of the WSE, dated December 11th 2007.
A requirement to include in Annual Reports aStatement of Compliance
with corporate governance standards has also been imposed under the
Minister of Finances Regulation on current and periodic information to
be published by issuers of securities and conditions for recognition as
equivalent of information whose disclosure is required under the laws of
anon-member state, dated February 19th 2009.
The Banks Statement on Application of Corporate Governance Standards
in 2011 (Corporate Governance Statement), whose contents conform
to the requirements, laid down by the two regulations, forms part of the
Annual Report.
Compliance with Applicable Standards,

Laws and Regulations
The Bank applies standards which aim to ensure compliance with the
law, the Statute, internal regulations, recommendations from regulatory
and supervision authorities, best practices and principles of ethics. In
managing compliance risk, the Bank follows the guidelines and standards
adopted across the UniCredit Group, unless these are in conflict with the
provisions of Polish law.
Pursuant to regulatory requirements (Resolution No. 258/2011 of the Polish Financial Supervision Authority), the Compliance Department operates
at the Bank as aunit set up by the Management Board to manage compliance risk. The Compliance Department reports directly to the President
of the Management Board.
The key areas of compliance risk management are defined in the Assumptions of Bank Pekao S.A.s Compliance Risk Policy (the Assumptions), approved by the Management and Supervisory Boards of the
Bank. They have been also adopted by the governing bodies of subsidiary
companies.
Bank Pekao S.A.s Compliance Risk Policy (The Policy), developed
based on the Assumptions, has been approved for implementation by way
of an order of the President of the Management Board.
The Policy defines the following scopes of powers and responsibilities as
regards compliance risk oversight and management:
the Supervisory Board oversees compliance risk management and
in particular it approves the assumptions of the Banks compliance
risk policy, and performs an annual evaluation of the effectiveness of
compliance risk management at the Bank,
the Management Board is responsible for an effective implementation

of compliance risk management measures, and in particular it drafts
the assumptions of Banks compliance risk policy, makes sure that
the policy is observed and that relevant reports are submitted to the
Supervisory Board,
Compliance Officer is responsible for coordinating the Banks compliance risk management activities,
heads of individual organisational units are responsible for compliance
risk oversight and management at their respective units; they also appoint persons who coordinate compliance risk management processes
at the units (compliance coordinators),
compliance coordinators are responsible for coordinating compliance
risk management processes at their respective units; in particular, their
duty is to identify, monitor and report compliance risk and to participate in compliance risk assessments covering specific areas.
Compliance risk is managed at the Bank through:
implementing Policy which outlines general rules of conduct for
employees and states that any behaviour which is in conflict with the
internal or external regulations exacerbates the reputation risk,
monitoring the compliance of employee behaviour with ethical norms
and best practices endorsed by trade organisations, stock exchanges
or other competent bodies,
ensuring conformity with compliance guidelines issued by the Management and Supervisory Boards,
conducting the process of compliance risk identification, monitoring
and reporting at the Banks organizational units,
reporting compliance incidents and the potential risk of their
occurrence,
undertaking actions aimed at minimizing or removing the effects of
identified irregularities (remedy process),
implementing solutions aimed at eliminating irregularities in the future
(preventive process),
conducting training related to compliance.
Compliance Department t is an integral part of the Banks internal control
system.
The key responsibilities of the Department include:
identification, assessment, monitoring and mitigation of compliance
risk,
regular revision of the Policy and monitoring of its observance,
coordination of compliance risk management processes,
promotion of awareness of compliance risk and its consequences for
the Bank among the Banks employees by conducting training and
appropriate communication.
The Compliance Officer takes part in the activities of the Security Committee, Change Management Committee and Operational Risk Committee, and participates in the meetings of the Supervisory Boards Audit
Committee.
Every year the Supervisory Board performs an evaluation of the effectiveness of compliance risk management at the Bank, as prescribed by Par.
22 sec. 3 of Resolution No. 258/2011 of the Polish FSA. The evaluation
involves reviewing and approving annual compliance risk reports.
In assessing compliance risk, the Bank relies on the methodology developed by the UniCredit Group.
General Meeting of Shareholders

Convening of the General Meetings
General Meetings of Shareholders are convened in accordance with
the applicable laws and the provisions of the Banks Statute, which are
consistent with the law.
Annual General Meetings of Shareholders are convened by the Banks
Management Board. They should be held no later than in June. The
Banks Supervisory Board is entitled to convene the Annual General Meeting if the Management Board has failed to do so by the prescribed time.
Extraordinary General Meetings of Shareholders are convened when
needed, either by the Banks Management Board acting on its own initiative, or upon the Supervisory Boards request. ashareholder or shareholders representing at least one twentieth of the share capital may request
that an Extraordinary General Meeting of Shareholders be convened and
specific items be placed on its agenda. An Extraordinary General Meeting
may also be called by the Supervisory Board, if it deems it advisable, or
by shareholders representing at least ahalf of the share capital or at least
ahalf of the total vote at the Bank.
Announcement on convening of the General Shareholders Meeting is
published at the Banks website and in the manner prescribed for disclosing current reports, not later than twenty six days before the scheduled
date of the Meeting.
As prescribed by the Commercial Companies Code, on the same day on
which the convening of aGeneral Shareholders Meeting of the Bank is
announced all documents to be submitted to the General Shareholders Meeting including draft resolutions are also published at the Banks
website.
All matters submitted for consideration to the General Meeting must
have the Supervisory Boards recommendation. Pursuant to Par. 9 of the
Banks Statute, all matters proposed to be debated by the General Meeting of Shareholders must first be submitted by the Management Board for
the Supervisory Boards consideration.
The General Meetings of Shareholders are attended by members of the
Supervisory and Management Boards, who provide shareholders with
85
Corporate Governance (cont.)
any desired explanations and information. The Banks external auditor is

obliged to attend the Annual General Meeting, as well as Extraordinary
General Meetings convened to deal with the companys finances, for instance to review and approve the Banks financial statements, the report
on the Banks operations, the consolidated financial statements of the
Banks Group and the report on the operations of the Banks Group.
Powers of the General Meeting

The scope of powers vested with the General Meeting of Shareholders is
defined in applicable laws, including the Commercial Companies Code
and Banking Law, as well as in the Banks Statute. The scope of powers
of the General Meeting is discussed in more detail in the Corporate
Governance Statement.
Rules of Procedure
The General Meeting of Shareholders operates in accordance with the
Rules of Procedure for General Meetings of Shareholders of Bank Polska
Kasa Opieki Spka Akcyjna, adopted by virtue of Resolution No. 19 of the
General Meeting of Shareholders of April 8th 2003, as amended (consolidated text adopted by Resolution No. 42 of the Ordinary General Meeting
of Shareholders of May 5th 2009).
The Rules of Procedure for General Meetings of Shareholders set out
detailed procedures for holding meetings and adopting resolutions.
The mode of operations of the General Meeting of Shareholders is presented in the Corporate Governance Statement.
The text of the Rules of Procedure for General Meetings of Shareholders
is available at the Banks website.
Main Rights of Shareholders

The Bank ensures that its shareholders may effectively exercise their
rights, notably the right to:
request that aGeneral Meeting of Shareholders be convened and
specific items be placed on its agenda,
participate in aGeneral Meeting of Shareholders, either in person or
through aproxy, and to exercise voting rights,
propose candidates for members of the Supervisory Board,
request that members of the Supervisory Board be elected in block
voting,
inspect the book of minutes, and receive copies of resolutions certified
by the Management Board.
Key shareholder rights are presented in more detail in the Corporate
Governance Statement.
86
Majority Rule and Protection of the Minority

As required under Art. 20 of the Commercial Companies Code, the Bank
makes sure that all shareholders, irrespective of the size of their holdings,
are given equal treatment in similar circumstances so that they are able
to exercise their property and procedural rights defined in the Commercial Companies Code and in the Statute, such as the right to share
in the Banks profits or the right to obtain information about the Bank (as
arule, the right is exercised during General Meetings of Shareholders,
as provided for in Art. 428 of the Commercial Companies Code), and
that they have equal access to inside information of the Bank as apublic
company, which is communicated to the public by way of current and
periodic reports published at the Banks website in the manner prescribed
in Art. 56 of the Act on Public Offering, Conditions Governing Introduction
of Financial Instruments to Organised Trading, and Public Companies,
dated July 29th 2005.
The Rules of Procedure for General Meetings of Shareholders stipulate
anumber of other measures which ensure equal treatment of all the
shareholders.
Each participant of aGeneral Meeting of Shareholders holding voting
rights may take the floor to discuss issues included in the agenda, ask
questions and demand explanations.
If so requested by even one shareholder, the Chairman of the Meeting
calls asecret ballot.
Each participant of aGeneral Meeting of Shareholders has the right to
put forward acandidate or candidates to the Supervisory Board, and to
submit his or her written statement to be included the minutes of the
Meeting.
Each shareholder who raises an objection to the Meetings resolution has
the right to present abrief justification.
The statutory bodies of the Bank, in the course of carrying out the duties
that have been assigned to them, seek to ensure that the achievement
of the majority shareholders interests is not detrimental to the minority
shareholders.
The majority rule is established under Par. 10.2 of the Banks Statute,
which provides that aGeneral Meeting of Shareholders may adopt
resolutions if at least 50 percent of the share capital plus one share is
represented at the Meeting, subject to the absolutely binding provisions
of law. The purpose of this provision is to guarantee that resolutions on
matters most important to the Bank and its shareholders are adopted by
the General Meeting in the presence of shareholders representing jointly
an absolute majority of the share capital. If aresolution is not adopted
for lack of the quorum required under the Banks Statute, it may be
adopted at the next Meeting with the same agenda, in the presence of
shareholders representing at least 20 percent of the share capital. Such

asolution is designed to protect the interests of minority shareholders.
Alicja Kornasiewicz, Chairwoman of the Supervisory Board, Member of

the Audit Committee and the Remuneration Committee.
The Bank ensures that minority shareholders may exercise their right
to request that aGeneral Meeting of Shareholders be convened, that
specific items be placed on the agenda of the next General Meeting of
Shareholders, as well as the right to propose draft resolutions on matters
which are or will be considered at aGeneral Meeting of Shareholders.
A graduate in finance of the Central School of Planning and Statistics in

Warsaw (currently the Warsaw School of Economics), holds aPh.D in
economy. Completed the Advanced Management Programme at Harvard
Business School and the Executive Management Programme at INSEAD.
She is astatutory auditor (licence no. 1777), amember of the National
Chamber of Statutory Auditors.
As stipulated in the Rules of Procedure for General Meetings of Shareholders, the Chairperson of the Meeting is responsible for ensuring that
the Meeting runs smoothly and due regard is paid to the rights and
interests of all shareholders, as well as for preventing any abuse by
the participants of their rights, and making sure that minority rights are
respected.
The minority protection principle finds expression in the Banks Statute,
which provides that the Supervisory Board should include representatives
of both majority and minority shareholders.
Supervisory Board
Pursuant to Par. 14.1 of the Banks Statute, the Supervisory Board is
composed of seven to nine members, appointed by the General Meeting
of Shareholders for ajoint three-year term of office. The number of
Supervisory Board members is determined by the General Meeting of
Shareholders. The General Meeting of Shareholders may remove aSupervisory Board member from office at any time.
The Supervisory Board elects from among its members the Chairperson,
two Deputy Chairpersons and the Secretary. The Deputy Chairman may
simultaneously perform the function of the Secretary.
Mrs Alicja Kornasiewicz held different positions of growing responsibility both in private and public sectors using her extensive expertise in
finances, accounting, economy and business, as well as her excellent
negotiation skills. From 1993 to 1997 she worked at the European Bank
for Reconstruction and Development. From 1997 to 2000 she served as
the Secretary of State in the Ministry of Treasury.
Since September 2000 Member of the Management Board of CAIB
Investment Bank AG, since July 2008 President of UniCredit CAIB AG in
Austria. She was also responsible for investment banking of the UniCredit
Group in the Central and Eastern Europe, and held the position of Member
of the Operating Committee of UniCredit Markets and Investment Banking.
From May 6th 2009 to January 12th 2010 member of the Banks Supervisory Board. From February 15th 2010 to August 30th 2010 member
of the Banks Management Board and acting President of the Banks
Management Board. President of the Management Board from August
31st 2010 to April 30th 2011.
Since May 1st 2011 member of the Banks Supervisory Board and since
June 1st 2011 Chairperson of the Supervisory Board.
Roberto Nicastro, Deputy Chairman of the Supervisory Board, Member
of the Remuneration Committee and Finance Committee.
Major in Business Administration, Bocconi University, Milan.
The Supervisory Board currently in office comprises nine members.

Pursuant to Par. 14.3 of the Banks Statute, at least half of the members
of the Supervisory Board, including its Chairperson, should possess
athorough knowledge of the Polish banking market, i.e. they should meet
all of the following criteria:
they have professional experience gained on the Polish market, relevant for the performance of asupervisory function at the Bank,
they are permanently domiciled in Poland,
they have command of the Polish language.
Before joining UniCredit, he had been an investment banker at Salomon

Brothers in London, and astrategic consultant at McKinsey & Company
in Milan.
In May 1997 Mr Nicastro joined Credito Italiano, as Head of Strategy,
Planning and Control. In October 2000 he was appointed Head of the
New Europe Division, with the task of developing UniCredits leading
banking position in Central and Eastern Europe.
As at the end of 2011, the aforementioned criteria were met by six

Supervisory Board members, including the Chairwoman.
In 2003 he became Head of Retail and CEO of UniCredit Banca. In July

2007 he was appointed Deputy CEO of the UniCredit Group.
The Supervisory Board members have the knowledge and experience

required to perform their duties. Their professional backgrounds may be
viewed at the Banks website.
As of November 1st 2010, Mr Nicastro took the position of General

Manager of the UniCredit Group with the reaponsibility for the Family and
SME, Private Banking and business in Central and Eastern Europe.
87
Member of the Banks Supervisory Board of the current term of office

since April 29th 2009; in the past, member of the Banks Supervisory
Board in the years 1999-2003.
Before joining UniCredit in 2000, he held executive positions at IMI International, Morgan Stanley International, McKinsey & Co. and the European
Bank for Reconstruction and Development.
He also serves as member of the Supervisory Boards of UniCredit Bank

Austria and UniCredit Bank Russia.
In June 2000, he joined UniCredit as the Head of Foreign Banks Strategy,

Mergers, Acquisitions, Planning and Control of the Group.
Since 2009, Mr Nicastro has been Chairman of EFMA, the European

Financial Management and Marketing Association in Paris. He is also
amember of the Executive Committee of the Italian Banking Association.
He serves in the advisory boards of SDA Bocconi, Milan and of Alma
School, Bologna.
In October 2002 he was appointed COO of Zagrebacka Banka, member

of UniCredit Group. He served as COO at Bulbank in Bulgaria, another
UniCredit Group company between 2003 and 2005.
Prof. Jerzy Wonicki, Deputy Chairman of the Supervisory Board, Member of the Audit Committee and Remuneration Committee.
At the beginning of 2006, Mr A. Decio was appointed Manager of

UniCredit Groups Germany Integration Project, before going on to serve
as UniCredit Group Deputy Head of Integration Office from July 2006 to
July 2007.
Mr Wonicki is professor of technical science, associated with Warsaw University of Technology, where he went through all the stages of
academic career, from junior lecturer to full professor. The scope of his
research covers the issues of IT and such fields as knowledge society,
innovation and knowledge-based economy. He was Dean of the Electronics and IT Faculty and, subsequently, Rector of the Warsaw University
of Technology. Ha was also President of the Conference of Rectors of
Academic Schools in Poland.
In April 2007 he was appointed as Executive Director of Yapi Kredi, in

July 2007 he also became the COO of the Bank, and in January 2009
appointed the Deputy CEO of Yapi Kredi.
Prof. Wonicki has been for many years active in business. He held
anumber of positions at various companies, including the position of
President of Softex Sp. z o.o., Deputy Chairman of the Supervisory Board
of PKN Orlen S.A., and member of the Board of the FIRE Innovation
Centre.
Pawe Dangel, Member of the Supervisory Board since

September 10th 1999.
Currently prof. J. Wonicki is the President of the Polish Rectors Foundation and Director of the Institute of Knowledge Society, Chairman of the
Committee for Organisational and Legislative Matters at the Conference of Rectors of Polish Academic Schools (KRASP), and amember of
KRASPs Presidium. He is also amember of the Committee of Ethics in
Science operating at the Presidium of the Polish Academy of Sciences.
He was the originator and co-author of the Code of Best Practices for
Schools of Higher Learning.
In the years 1980-1984 he worked as atheatre producer in Poland and

since 1984 as aproducer and lecturer in theatre academies in London.
During his over 12 year tenure on the Supervisory Board of Bank

Pekao S.A. prof. J. Wonicki gained substantial expertise and experience in banking and in the Banks operations. He was honoured with
amedal For Merit to Banking by the President of the National Bank
of Poland.
Alessandro Decio, Secretary of the Supervisory Board, Member of the
Audit Committee and the Finance Committee.
A graduate from the Departament of Economics, Bocconi University,
Milan, holds also an MA from INSEAD.
88
As of February 2011 he has become Head of UniCredits Family&SME

Division.
Member of the Board of Directors of Bank Pekao S.A. since April 19th 2011.
Mr Dangel holds Master of Arts degree in Directing from the State Institute for Theatre Arts in Moscow.
He has extensive experience in insurance and finance, having completed

anumber of specialist courses in management, insurance and finance.
From 1986, Mr Dangel worked as financial and insurance adviser for UKbased insurance companies.
In the years 1994-1997, he was Vice President of the Management
Board and Sales and Marketing Director at the Life Insurance Company:
Nationale Nederlanden Polska S.A.
Since 1997, he has been President of the Management Board of the
Insurance Company: Allianz Polska S.A. and President of the Management
Board of the Life Insurance Company: Allianz ycie Polska S.A.
Mr Dangel is also the Chairman of the Supervisory Board of PTE Allianz
Polska S.A., and Vice President of the Polish Association of Private
Employers of Insurance Companies, Pension and Investment Fund Companies at the Polish Confederation of Private Employers Lewiatan.
Oliver Greene, Member of the Supervisory Board, Chairman of the Audit

Committee.
Mr Pavonis work has been amajor contribution to the development of

economic relations between Poland and Italy.
A graduate from Westminster School and Oxford University, where he

received degrees of BA and MA in Philosophy, Politics and Economics.
Prof. Leszek Pawowicz, Member of the Supervisory Board since January 8th 1998; Member of the Audit Committee.
Mr Greene has extensive experience in particular in corporate, international and investment banking, planning and controlling, risk management, loan workout, M&A, and leasing.
Prof. Pawowicz received adegree in Economics from the University of

Gdask in 1973.
During his rich professional career, he has held anumber of executive

positions at many international financial institutions, including:
Citibank Group (1965-1980) in London and New York, including at
Citicorp Leasing,
Bankers Trust Company (1980-1988) in London as Head of the UK
Division, World Corporate Department,
The Chase Manhattan Bank NA (1988-1996) as Managing Director
Head of UK Corporate Group, Managing Director for Asset Recovery,
Managing Director for Risk,
Union Bank of Switzerland (1996-1998) as Managing Director for
Investment Banking, Senior Banker in charge of Corporate Finance and
Advisory Services for the FTSE Companies;
European Bank for Reconstruction and Development (1998-2003) as
Head of Corporate Loan Workout in charge of recovery of classified
assets of EBRD.
From 2004 to 2011, Mr Oliver Greene was consultant to the EBRD.
From the beginning of his professional career, he has been associated

with the Economics of Production Faculty (currently Faculty of Management) of the University of Gdask, where he successfully completed all
stages of an academic career. In 1977 he was awarded aPhD degree
in Economics, and in 1988 adegree of habilitated doctor in Economic
Sciences. In 1993, prof. Pawowicz was given the title of professor of the
University of Gdask, and since 2003, he has been Head of the Banking
Faculty.
Prof. L. Pawowicz is an expert in the domain of banking, and an author of
numerous dissertations and articles on the subject.
Currently prof. L.Pawowicz is Director of the Gdask Academy of Banking, Vice President of the Management Board of the Gdask Institute for
Market Economics, and President of the Supervisory Board of the Warsaw
Stock Exchange. He is also member of the Supervisory Board of PTE
Allianz Polska S.A., the Supervisory Board of BEST S.A., Editorial Board of
the Finansowanie Nieruchomoci (Real Estate Finance) quarterly, and the
Supervisory Board of PKN Orlen.
Member of the Supervisory Board of the Bank since June 1st 2004.
Enrico Pavoni, has been Member of the Supervisory Board since
September 10th 1999; Member of the Remuneration Committee and the
Finance Committee.
From the start of his professional career, Enrico Pavoni has been associated with the FIAT Group. Since 1978, he has been in charge of
the Groups operations in Poland. In 1992, Mr Pavoni was amember of
ateam participating in the negotiations concerning the privatisation of
Fabryka Samochodw Maolitraowych in Bielsko-Biaa. He coordinated
the FIAT Groups investments in Poland.
Since 1995, Mr Enrico Pavoni has been President of the Management
Board of FIAT POLSKA Sp. z o.o. As part of the roles and responsibilities
at FIAT S.p.A., he coordinates and supervises the Groups projects in
Poland. In all the initiated undertakings, he performs various functions on
supervisory and management boards.
He was Vice-Chairman of the Supervisory Board of FIAT AUTO POLAND
S.A. for ten years (1992-2002), and since April 8th 2002 he has been
President of FIAT AUTO POLAND S.A.s Management Board.
Dr Krzysztof Pawowski has been Member of the Supervisory Board

since July 25th 2007.
Dr Pawowski holds adegree in Physics from the Faculty of Mathematics,
Physics and Chemistry of the Jagiellonian University. In 1975, he received
adegree of Doctor of Science in Physics from the University of Science
and Technology in Cracow. He was also awarded adegree of Doctor
Honoris Causa by the National Louis University in Chicago.
In 1969-1989, he worked at aresearch laboratory of Sdeckie Zakady
Elektro-Wglowe, and in 1985-1989 he was head of the laboratory. In
1989-1993 he was member of the Senate of the Republic of Poland of
the first and second term of office, and in 1991-1993 he chaired the
Senate Commission for European Integration.
Dr K. Pawowski is afounder (1991), and since 1992 the Rector of
Wysza Szkoa Biznesu (Academy of Business) National Louis University
in Nowy Scz. In 1996 he founded and became rector of Wysza Szkoa
Biznesu National Louis University in Tarnw. From 2007 to 2010 he was
President of both merged schools. Currently, he is the Rector of Wysza
Szkoa Biznesu National Louis University. He is aMember of the Board
of Directors of the Polish-American Freedom Foundation.
89
Dr Pawowski is the author of several dozen scientific publications in the

field of physics and 149 academic publications (including several books),
lectures and press articles, including the ones on the management of
post-secondary education and regional development, leadership and
strategy. He also has wide experience in organizing training courses for
top management.
He has received anumber of prestigious awards and distinctions,
including the title of Entrepreneur of the Year 2003 in the competition
organised by Ernst&Young.
Federico Ghizzoni, Deputy Chairman and Secretary of the Supervisory
Board and Mmber of the Audit Committee, the Remuneration Committee
and the Finance Committee to April 30th 2011. He was amember of the
Supervisory Board since July 25th 2007; on April 30th 2011 he resigned
from functions held in the Suervisory Board.
Mr Ghizzoni holds adegree in Law from the University of Law in Parma.
From the very beginning of his professional career he has been associated with UniCredit, where he has performed anumber of managerial
functions, both in Italy and abroad.
In the years 2000-2002, he worked as Executive Director in charge of
Corporate and International Banking at Bank Pekao S.A.
Since September 30th 2010, he has been Chief Executive Officer of
UniCredit.
Mr Ghizzoni is Member of the International Monetary Conference in
Washington and Member of the Institut International dEtudes Bancaires
in Brussels. He is also Chairman of the Orchestra Filarmonica della Scala
Association in Milan.
Sergio Ermotti, Member of the Supervisory Board from April 29th 2009
to February 23rd 2011.
In the years 2006-2010 he worked for UniCredit, where his responsibilities included Corporate and Investment Banking and Private Banking.
As of February 23rd 2011 he resigned from being amember of the
Supervisory Board.
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Powers of the Supervisory Board

In addition to other rights and obligations provided for in the Commercial
Companies Code and the Banks Statute, the scope of powers and duties
of the Supervisory Board includes in particular:
reviewing the Management Boards Report on the Banks operations
and the financial statements for the previous financial year,
reviewing the Management Boards recommendations concerning the
distribution of profit or coverage of loss,
reviewing the Management Boards Report on the Groups operations
and the consolidated financial statements for the previous financial
year,
presenting the General Meeting of Shareholders with areport on the
results of the above reviews and areport on the Supervisory Boards
activities in the previous financial year,
requesting approval from the Polish Financial Supervision Authority for
appointment of two members of the Management Board, including the
President,
appointing and removing from office the President of the Management Board and, upon the Presidents request, Vice Presidents and
members of the Management Board,
suspending from office amember (members) of the Management
Board for important reasons,
determining the terms and conditions of contracts governing employment relationships or other legal relationships between members of
the Management Board and the Bank,
giving opinions on long-term development plans and annual financial
plans of the Bank,
giving opinions on the Management Boards proposals concerning establishment of other companies or joining other companies as ashareholder, as well as disposal of shares or other equity interests, where
agiven transaction is related to along-term strategic investment,
approving the establishment or liquidation of foreign branches and
representative offices of the Bank,
adopting, upon the Management Boards request, rules governing the
creation and use of funds specified in the Statute,
approving the Management Boards proposals concerning purchase,
encumbrance, or sale of real estate, an interest in or perpetual
usufruct rights to real estate, where the value of agiven transaction
exceeds PLN 2m,
approving the Management Boards proposals concerning assumption
of an obligation or disposal of assets, where the value of agiven transaction executed with asingle entity exceeds 5% of the Banks equity,
approving the Management Boards proposals to outsource services,
where the services pertain to astrategic area of the Banks business
or their value equals or exceeds EUR 1m.
Operation of the Supervisory Board

The Supervisory Board operates in accordance with its Rules of Procedure, adopted by virtue of Resolution No. 17/03 of May 22nd 2003 and
amended by virtue of Resolution No. 20/05 of June 27th 2005. The Rules
of Procedure are available at the Banks website.
Meetings of the Supervisory Board are held when needed, but not less
frequently than once in two months. The Rules of Procedure of the
Supervisory Board provide that the meetings are accessible and open
to members of the Management Board, unless they deal with matters
relating directly to the Banks Management Board or its members, and in
particular with the appointment or removal from office of the President of
the Management Board or, upon the Presidents request, Vice Presidents
or members of the Management Board, their suspension from office,
determination of responsibility or remuneration.
According to the Statute and the Code of Best Practice for WSE Listed
Companies, every year the Supervisory Board submits to the General
Meeting of Shareholders an evaluation of its work and aconcise evaluation of the Banks standing, with special focus on the internal control
system and the system for managing risks material to the Bank. The
documents are made available to the shareholders before the General
Meeting.
The Rules of Procedure of the Supervisory Board stipulate, in line
with the principles set out in the Code of Best Practice for WSE Listed
Companies, that in the event of aconflict of interest, the Supervisory
Board member concerned is obliged to inform the other members of
its occurrence and refrain from discussing and voting on aresolution
which relates to the matter in respect of which the conflict of interests
has occurred.
The Bank has in place aprocedure for obtaining information from members of the Supervisory Board on any personal, actual and organisational
links. Such information is then disclosed in current and periodic reports in
accordance with applicable laws and the Code of Best Practice for WSE
Listed Companies.
In 2011, the Supervisory Board held 8 meetings, considered 101 information notes, analyses and proposals, and adopted 65 resolutions.
Independent Members
At least half of the members of the Supervisory Board should be
independent members. Independent members of the Supervisory Board
should not have any relations which could materially affect their ability to
make impartial decisions.
Detailed criteria which must be satisfied by members of the Supervisory
Board to be deemed independent members are set out in the Banks
Statute. Pursuant to Par. 14.5 of the Banks Statute, to be deemed
independent, amember of the Supervisory Board must meet all of the

following conditions:
1. he or she is not and has not been in the last three years employed at
the Bank, its subsidiaries or parent company,
2. he or she does not hold and has not held in the last three years
aposition of amember of the Management Board or other managerial
position (irrespective of the legal basis of employment) at the Bank, its
subsidiaries or parent company,
3. he or she is not and has not been in the last three years an auditor of
the Bank, its subsidiaries or parent company, or an employee of an
entity providing auditing services to the Bank, its subsidiaries or parent
company,
4. he or she is not ashareholder holding more than 5% of the total vote
at the Banks General Meeting of Shareholders and is not employed by
such ashareholder,
5. he or she does not receive any additional remuneration (except for
remuneration payable on account of serving as amember of the
Supervisory Board), or any other proprietary benefits from the Bank,
its subsidiaries or parent company, except for the benefits due to that
person as aclient under an agreement concluded on standards terms
with the Bank, its subsidiaries or parent company,
6. he or she is not and has not been in the last three years aspouse,
acohabitating partner or arelative through blood or marriage of
amember of the Banks Management Board or an employee holding
amanagerial position at the Bank,
7. he or she is not amember of the management board of another
company in which amember of the Banks Management Board serves
as amember of the supervisory board,
8. he or she has no material business links with the Bank, its subsidiaries
or parent company which might compromise his or her independence,
and
9. if the election date falls within three years of the date of registration of
the increase in the Banks share capital made with aview to delivering
shares to the shareholders of Bank BPH S.A. in connection with Bank
BPH S.A.s division by way of aspin-off he or she is not related to
Bank BPH S.A., its subsidiaries or parent companies in the manner
referred to in Section 1, 2, 3 and 6 above.
According to the submitted representations, the independence criteria set
forth in the Statute are satisfied by six members of the Supervisory Board,
namely Messrs J. Wonicki, P. Dangel, O. Greene, E. Pavoni, L. Pawowicz
and K. Pawowski.
Committees of the Supervisory Board

The Supervisory Board performs its functions during meetings and
through the Audit, Remuneration and Finance Committees. Composition
of the Committees is presented further on in the Corporate Governance
Statement.
The Audit Committee operates under Art. 86 of the Act on Qualified
Auditors, their Self-Government, Entities Qualified to Audit Financial
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Statements and on Public Supervision, dated May 7th 2009 (Act on

Qualified Auditors).
The Audit Committee supports the Supervisory Board in the performance
of its supervisory duties, related in particular to the adequacy and effectiveness of the Banks internal controls, including risk identification,
measurement and management, compliance with applicable laws and
procedures governing the Banks operations, correctness of the application of accounting principles in the process of drawing up financial
statements, ensuring impartiality of external auditors, and evaluation of
resources at the Internal Audit Department.
The remit of the Audit Committee is defined in Art. 86.7 and 86.8 of
the Act on Qualified Auditors. The detailed scope of powers and duties of
the Audit Committee is laid down in the Supervisory Boards Resolution
No. 42/07 of October 2nd 2007.
The remit of the Audit Committee includes in particular:
assessment of the effectiveness of the Banks internal control system,
review of material conclusions based on the work of the Banks
Internal Audit team and inspections carried out by external entities,
oversight over remedial actions,
making recommendations to the Supervisory Board regarding selection
of an auditing firm to audit the Banks financial statements, and evaluation of the cooperation with the auditor,
examination of the process of preparing financial statements.
The Committees key role and responsibility is to present the Supervisory

Board with proposals concerning specific matters, including:
remuneration of the Management Board members,
policy governing the remuneration of the Banks management staff,
recommendations as to the remuneration of the Supervisory Board
members to be presented to the General Meeting of Shareholders.
The Committee meetings are held as need arises. In 2011, the Remuneration Committee held two meetings.
The Finance Committee operates under the Supervisory Boards resolution. Its role is to exercise supervision over the finances of the Bank.
The Committee members may use the services of professional advisers
appointed under the Supervisory Boards resolution. The advisers are
obliged to keep confidential any information obtained while performing
the tasks ordered by the Finance Committee.
The annual reports on the activities of all Committees are available to
shareholders.
Management Board
The Management Board is composed of five to nine members.
The Audit Committee is composed of five persons elected from among

members of the Supervisory Board, including three independent
members.
Meetings of the Audit Committee are held as need arises, but not less frequently than four times ayear, and the dates of these meetings coincide
with key dates in the Banks reporting cycle and the review of the annual
internal audit plan.
In 2011, the Audit Committee held six meetings.
The Committee meetings are attended by the President of the Management Board and other top management staff if matters discussed fall
within their respective scopes of responsibility. The Committee also holds
meetings without the presence of the Management Board representatives with the Banks external auditor.
Every six months, the Audit Committee submits to the Supervisory Board
periodic reports on its activities, which address previously issued recommendations, if any.
The Remuneration Committee operates under the Supervisory Boards
resolution of January 24th 2000 and the Rules of Procedure of the
Supervisory Board.
92
Members of the Management Board are appointed by the Supervisory

Board for ajoint three-year term of office.
Vice Presidents and members of the Management Board are appointed
and removed from office upon the Presidents request. Appointment
of two members of the Management Board, including the President, is
subject to approval by the Polish Financial Supervision Authority. The
body which applies to the Polish Financial Supervision Authority for the
approval is the Supervisory Board.
At least half of the members of the Management Board, including its
President, should possess athorough knowledge of the Polish banking
market, i.e. they should meet all of the following criteria:
they have professional experience gained on the Polish market, relevant for the performance of amanagerial function at the Bank
they are permanently domiciled in Poland
In the Management Board of the current term of office, all of the aforementioned criteria are met by four members.
The Management Board currently in office comprises six members,
including the President and five Vice Presidents.
All Management Board members have extensive knowledge and experience needed to perform their duties on the Board. Their professional
backgrounds may be viewed at the Banks website.
Since December 11th 2008 he has served as Vice President of the

Management Board, Chief Risk Officer.
Mr Marco Iannaccone, Vice President of the Management Board, CFO.
Mr Luigi Lovaglio, President of the Banks Management Board, CEO.

A graduate from the Department of Economics at the University of
Bologna.
He has been working for UniCredit Group since 1973, progressing
through anumber of important positions, including ten years as senior
executive managing market areas of increasing importance.
In 1997 he had been appointed Head of Strategic UniCredit Group
Planning and was involved in several mergers of UniCredito with newly
acquired banks.
Since 1999 he has been cooperating with Bank Pekao, with primary
responsibility for the integration of the Bank with the UniCredit Group. He
was also Project Leader of the integration of Bank Pekao S.A. with Bank
BPH SA, successfully completed in November 2007.
In the years 2000-2003 he was Deputy Chairman of the Management
Board and Executive Director of Bulbank AD, the largest Bulgarian bank.
Mr Lovaglio joined the Banks Management Board in September 2003.
On April 14th 2011 the Supervisory Board of Bank Pekao S.A. unanimously appointed Mr Lovaglio as President of the Management Board,
effective May 1st 2011.
In 2008, Mr Lovaglio was awarded the title of Italys Commander of the
Order of the Star of Italian Solidarity by the Giorgio Napolitano, President
of Italy, in recognition of his outstanding contribution to the development
of economic cooperation between Poland and Italy.
A graduate from Universita degli Studi di Venezia-Ca Foscari and the

Clemson University in the USA where he obtained his MBA diploma.
Mr Iannaccones first job was as ajunior researcher at the Departments
of Applied Economics and Finance of Clemson University. In 1995 he
worked for 3B S.p.A. and then served as aconsultant at KPMG in Milan.
He continued his work as aconsultant at Andersen Consulting in Milan. In
the years 1999-2002 he worked for Deutsche Bank S.p.A. in Milan where
he was in charge of the biggest restructuring project of that bank in Italy.
In 2002, Mr Iannaccone joined the UniCredit Group. He was responsible
for the Groups operations in the area of mergers and acquisitions (with
the main focus on Private Banking and Asset Management Divisions). He
then moved to the consultancy department at UniCredit Private Banking S.p.A., where he focused on wealth management. Since 2005, he
pursued his career in the New Europe Business Division, where he was in
charge of management from the planning and development perspective of foreign banks in Slovakia, the Czech Republic and Bulgaria.
Since September 2006, after the merger of UniCredit and HVB, he was
responsible for planning, strategy and controlling at UnCredits companies
in CEE countries, including Poland.
Since September 2008 Chief Financial Officer at Bank Pekao S.A. Since
December 11th 2008 he has been Vice President of the Management
Board, CFO.
Mr Andrzej Kopyrski, Vice President of the Banks Management Board.
He is agraduate of Warsaw University of Technology and the University of
Strathclyde (Glasgow).
Mr Diego Biondo Vice President of the Management Board, CRO.

He completed business management studies at the University of Turin.
Mr Biondo started his professional career in 1990 at the Fiat Group in
Turin, where he held anumber of positions in the Finance Department.
In 2000, he became Vice President and Deputy Treasurer of Fiat Finance
North America of New York. In that role, he was responsible for the
financing activities of the Fiat Groups companies in the US, Canada and
Mexico. In the years 2001-2003, he was Vice President and Chief Financial Officer at Fiat Polska Sp. z o.o. in charge of the financing activities of
the Fiat Group in Poland.
Mr Biondo joined Bank Pekao S.A. in 2003 as Executive Director, Head of
the Risk Management Division (CRO).
He has been associated with the banking sector since 1992, when he
joined Bank Pekao S.A. In 1993-1996, he worked at the Corporate
Banking Division at ING Bank Polska. Afterwards, he became Head of
Structural Finance at Deutsche Bank Polska, and then in 1997- 2001
he held the position of Head of Structural Finance and Capital Markets
at ABN Amro Bank (Polska). Since 2001, Mr Kopyrski was Management
Board member at HSBC Financial Services (Poland).
From April 2002, Mr Andrzej Kopyrski worked for Bank BPH S.A. as
Managing Director responsible for Sales, Structural Finance and Capital
Markets. After the merger with Bank Pekao S.A., he took charge of the
Investment Banking and Structural Finance Department.
He was appointed Vice President of the Management Board of Bank
Pekao S.A. on June 4th 2008. Currently he supervises the Corporate
Banking, Markets and Investment Banking Division.
93
Mr Grzegorz Piwowar, Vice President of the Banks Management Board.

He holds amasters degree in Electronics from the University of Science
and Technology of Krakw, and completed post-graduate studies in banking at the Krakw School of Economics.
Mr Grzegorz Piwowar started his professional career in banking at Bank
BPH S.A. in 1992. In 1996-2000, he was Director of the Brokerage
House and then worked as Director of Retail Banking of the South Region
for two years. In 2002, he was promoted to the position of Sales and
Distribution Managing Director of the Retail Banking Division. In October
2006, he was appointed as member of the Management Board of Bank
BPH S.A. in charge of Retail Banking.
Since November 30th 2007, he held the position of Vice President of the
Management Board of Bank Pekao S.A. with responsibility for the Retail
and Business Banking Division and since January 1st 2009 he has been
responsible for the integrated Retail Banking Division.
The Management Board prepares the development strategy for the Bank
and is responsible for the implementation of that strategy. Pursuing the
principle of efficient and prudent management, the Management Board
is responsible for initiation and implementation of programmes aimed at
increasing the Banks value and rate of return for the shareholders, as
well as protection of the employees long-term interests.
In its decisions, the Banks Management Board makes every effort to
ensure, to the maximum extent possible, the promotion of the interests
of the shareholders, customers, employees, as well as other entities and
persons cooperating with the Bank in its business activity.
Functioning of the Management Board

The rules and procedures governing the activities of the Banks Management Board are stipulated in the Rules of Procedure for the Management
Board of Bank Pekao S.A., approved under Resolution No. 101/VI/03 of
the Banks Management Board dated June 3rd 2003. The Rules of Procedure are available at the Banks website.
Mr Marian Wayski, Vice President of the Management Board.

A graduate of Warsaw University, Faculty of Law and Administration; he
also completed postgraduate studies in commercial bank management at
the Warsaw School of Economics.
He has been working in the banking sector since 1986. In 1986-1990,
Mr Wayski was Director of the Office of the Governor of the National
Bank of Poland. From 1990 till 1998, he held anumber of managerial
positions at commercial banks. He was amember of the Management
Board of AmerBank and Animex Bank, and aRegional Director of Bank
Depozytowo-Kredytowy S.A.
Since he joined Bank Pekao S.A. in 1998, he was Merger Manager
responsible for atransaction involving merger of four banks, and then
became Executive Director responsible for the Logistics Division. Since
December 15th 2004, he has been amember of the Management Board
of the Bank. In November 2007, Mr Wayski was appointed Vice President of the Management Board; he supervises Logistics and Procurement
Division.
The core values underlying the management of the Bank are professionalism, credibility and confidentiality, while customer relations are
underpinned by reliability and integrity, as well as compliance with applicable laws. These values are among the principles incorporated in the
Code of Professional Ethics and UniCredit Integrity Charter implemented
at the Bank.
Each member of the Banks Management Board is obliged to act in such
away as to further the Banks interests. According to the Code of Professional Ethics effective at the Bank, each member of the Management
Board is expected to be honest and loyal in pursuing the common objectives, and to respect the Banks resources and use them in aprudent
manner.
Moreover, members of the Management Board are prohibited from
taking any decisions or actions that would lead to conflicts of interests
or that would be incompatible with the Banks interests or their official
duties. aManagement Board member is obliged to notify the Supervisory
Board of any situation in which aconflict of interests might occur or has
occurred.
Powers of the Management Board

The scope of powers of the Management Board is defined by the provisions of applicable laws, including the Commercial Companies Code,
Banking Law Act and the Banks Statute.
The Management Boards powers include all matters which, pursuant to
the provisions of applicable laws or the Banks Statute, do not fall within
the scope of competence of other governing bodies of the Bank.
94
A Management Board member who becomes aware of any situation

where an employee or arepresentative of abusiness partner of the Bank
demanded any benefits, regardless of their scope and nature, should
promptly notify the Supervisory Board of such demand.
The Rules of Procedure for the Management Board specify the issues
which require collective consideration by the Management Board.
According to the Rules of Procedure, the following issues in particular

require collective consideration by the Management Board:
the Banks development strategy
financial plans, reports on the operations and financial statements of
the Bank and its Capital Group
proposed distribution of profit (coverage of loss)
rules for and manner of implementation of: the investment policy, the
assets and liabilities management policy, the credit policy, the HR
policy, the remuneration policy, the employee benefits policy and the
interest rates policy
matters relating to purchase, encumbrance and sale of real estate or
interests in real estate
matters relating to the organisational structure of the Head Office, as
well as the establishment and liquidation of the Banks organisational
units
adoption of rules for special accounts
establishment of other companies, joining other companies and
disposal of shares (or other equity interests), where agiven transaction
relates to along-term strategic investment
establishment of associations and foundations and joining associations
and foundations
matters relating to the participation of the Banks employees in supervisory boards of companies in which the Bank holds equity interests.
Furthermore, the Management Board collectively considers all matters
which are submitted to the Supervisory Board for consideration.
The Management Board is headed by the President, who convenes and
presides over its meetings, presents its position to other governing bodies
of the Bank and in relations with third parties, in particular with governmental authorities, and issues internal regulations. The President may
delegate the authority to issue internal regulations to other persons.
In 2010, the Management Board held 46 meetings and adopted
454 resolutions.
Management Structure
Members of the Management Board coordinate and supervise the Banks
operations in line with the allocation of responsibilities adopted under
a resolution of the Management Board and approved by the Supervisory
Board.
Mr. Luigi Lovaglio, President of the Management Board, coordinated the
activities of the Members of the Management Board and supervised
a number of areas of the Banks activity, in particular: internal audit,
compliance, and corporate communication, including investor relations.
bodies of the Bank and in relations with third parties, in particular with the
state authorities, and issued internal regulations.
Mr. Diego Biondo, Vice President of the Management Board, supervised
the activity of the Risk Management Division.
Mr. Marco Iannaccone, Vice President of the Management Board, supervised the activity of the Finance Division.
Mr. Andrzej Kopyrski, Vice President of the Management Board, supervised the activity of the Corporate Banking and MIB Division.
Mr. Grzegorz Piwowar, Vice President of the Management Board, supervised the activity of the Retail Banking Division.
Mr. Marian Wayski, Vice President of the Management Board, supervised the activity of the Logistics and Procurement Division.
The Management Board ensures that the management system at the
Bank is transparent and effective, and runs the Banks affairs in compliance with applicable laws and the rules of the Code of Best Practice for
WSE Listed Companies.
The Banks organisational structure is made up of:
the Head Office
operational units of the Head Office
Regional offices
Branches with Sub-Branches and Banking Service Points
other organisational units, including Regional Corporate Centres.
The basic organisational units of the Banks Head Office (departments
and offices) may be combined into business divisions. Each business
division is supervised by amember of the Management Board; it may be
managed by an Executive Director/Head of Division.
The Banks Head Office has the following standing Committees:
Credit Committee of the Bank
Assets, Liabilities and Risk Committee
Liquidity and Market Risk Committee
Operational Risk Committee
Change Management Committee
Security Committee.
The respective remits, composition and rules for the functioning of the
above Committees are set out in the Banks internal regulations.
Additionally, ad hoc units may be set up at the Banks Head Office (dedicated task teams, project teams).
Mr. Luigi Lovaglio headed the Management Board, convened and presided over the Board meetings, presented its stance to other governing
95

Risk Management System
The risk management system in place at Bank Pekao S.A. is defined in
the ICAAP Procedure, adopted by the Banks Management Board and
approved by its Supervisory Board.
The ICAAP strategy outlines the key elements of acomprehensive
approach to the risks arising from the Banks operations and business
strategy, both at the level of the Bank and the entire Bank Pekao S.A.
Group, by defining the risks identified by the Bank and the criteria for
classifying risks as material, and by setting out the objectives and principles of risk management, the target structure of risk exposure arising
from the Banks operations, as well as the acceptable level and structure
of the risk exposure.
A risk is defined as the possibility that the consequences of agiven
action or event may prove adverse, leading to foreseen or unforeseen
losses of the Bank or limiting the Banks ability to implement the business
strategy it has adopted.
Every identified risk should be assessed in terms of its materiality and
if found to be material measured (if classified as measurable), as
well as monitored and controlled in line with the methods and procedures
defined specifically for agiven type of risk. The risk assessment and
measurement methodologies are designed to ensure compliance with the
applicable legal requirements, best market practices and the UniCredit
Groups guidance.
The risk management system in place at the Bank constitutes an integral
part of the Banks management system.
The risk management system is used to identify, measure (estimate),
monitor and control the risks inherent in the Banks operations in order to
ensure that the process of setting and attaining specific objectives related
to the Banks operations functions properly. Risk management improves
the efficiency of the decision-making process, while ensuring compliance
of the Banks decisions with the best market practice and the applicable
regulatory regime.
As part of its risk management system, the Bank uses formal rules
to quantify and manage its risk exposures, and formal procedures to
identify, measure or estimate, and monitor the risks, accounting also for
expected future exposures. The Bank applies formal limits to mitigate
the risks and defines rules to be followed in the event that the limits are
exceeded, while the adopted management information system serves as
atool enabling it to monitor the risks. The Banks organisational structure
is adapted to the size and profile of its risk exposure. In managing risks
at the Group level, the Bank oversees the risk exposures inherent in the
operations of its subsidiaries.
96
Under the risk management system currently in place at the Bank, the
Management Board is responsible for:
developing and implementing arisk management strategy, including
the objectives and key principles of risk management;
developing, implementing and regularly updating written strategies,
policies and procedures related to the area of risk management;
effectiveness of the risk management system and its continuous
enhancement;
taking appropriate steps with aview to ensuring that the Bank manages all the material risks inherent in its operations and the operations of
its subsidiaries and that relevant procedures are in place; in particular,
the Management Board appoints the relevant committees, ensures that
internal regulations are issued serving to identify, measure, monitor
and control the risks, and submits to the Supervisory Board periodic
reports on the types of risk and size of the Banks exposures;
approving the system of limits adopted by the Bank for different types
of risk and the level of general capital limits;
ensuring compliance of the Banks operations with the law and effectively managing compliance risk;
introducing at the Bank an organisational structure adapted to the size
and profile of the Banks risk exposure and reflecting such division of
responsibilities which ensures independence of the risk control function from the operating area responsible for the Banks risk taking;
transparency of the Banks operations, making it possible to assess
the Supervisory Boards and the Management Boards effectiveness in
managing the Bank, monitoring its operational security and assessing
its financial standing.
Decisions to implement new, or modify the existing products, including
financial products (to the extent such decisions are not reserved for the
Banks Management Board), while ensuring their consistency with the
Banks strategy and defined business model, and prioritising the planned
changes, have been entrusted to the Change Management Committee. All
such decisions are preceded by apreparatory process as part of which
material risks are identified, the product is included by the existing risk
identification and measurement system, the internal limits are determined
and the rules of accounting/reporting are set down.
The Banks Management Board receives regular updates on the Banks
risk profile, the largest exposures and credit risk concentrations.
The Supervisory Board exercises supervision over the consistency of the
Banks risk-taking policy with its strategy and financial plan, by:
approving the Banks strategy and prudent management policies;
in particular, the Supervisory Board approves the risk management
strategy, including the objectives and key principles of the Banks risk
management;
reviewing the Management Boards reports concerning the types and
materiality of the risks to which the Bank is exposed, and in particular
exercising supervision over the consistency of the Banks risk-taking
policy with its strategy and financial plan;
setting up Committees of the Supervisory Board;
appointing and removing from office members of the Banks Management Board duly qualified to perform their functions;
approving the division of responsibilities between members of the
Management Board who coordinate and supervise the Banks operations within their respective areas of responsibility, including the
Banks organisational structure taking into account the size and
profile of the Banks risk exposures and ensuring independence of the
risk control function from the operating area responsible for the Banks
risk taking;
overseeing the management of compliance risk, approving the key
assumptions of the Banks policy in that area, and performing, at
least annually, an assessment of the effectiveness of compliance risk
management.
The risk management strategy and system in place at the Bank are subject to regular reviews and necessary updates to ensure that they remain
adequate given the scale and complexity of the Banks operations.
Internal Control System

The Banks Internal Control System comprises all internal regulations,
procedures, controls, limits and self-control mechanisms which acting
together aim to ensure:
compliance with the Banks strategy,
efficiency and effectiveness of procedures,
protection of assets,
prevention of losses, errors and damage to the Banks reputation,
security, stability and efficiency of operations,
reliability and completeness of accounting records and management
information,
compliance of transactions with the generally applicable laws, regulations issued by the competent supervisory authorities, as well as
internal policies, plans, regulations and procedures, and
support of the decision-making process.
The Banks Internal Control System is adapted to its operations and
organisational structure and is adequately suited to the size and profile
of the risks defined by the ICAAP Procedure, i.e. the three key risk areas:
credit risk, financial and operational risk and the Pillar II risks (i.e. real
estate risk, financial investment risk, business risk, compliance risk,
reputation risk and strategic risk).
Internal control is acontinuous process, taking place at all levels of the
organisation. The statutory bodies of the Bank, its individual organisational
units and teams, the supervisory and management staff at all levels of
the Bank, as well as all employees are involved, in different roles, in the
Internal Control System.
Internal Control System as well as for the effectiveness of the Internal

Control System, which is adapted to the size and profile of the risk associated with the Banks operations. The President of the Management Board
issues, in the form of an order, the Internal Control Regulations.
The Supervisory Board is responsible for exercising effective supervision over the operation of the Internal Control System, which includes
evaluation of its idependence, reliability, adequacy and effectiveness. The
Supervisory Board is assisted in the performance of those duties by the
Audit Committee and the Internal Audit.
The Internal Control System consists of the following levels:
Employee-Level Control (including functional control)
Risk Management Control, and
Internal Audit (institutional control).
The purpose of Employee-Level Control (including functional control) is to
ensure correctness of transactions and compliance of the Banks operations with procedures, limits and regulations, to react to any shortcomings
and failures, and to monitor the implementation of issued recommendations. This control is performed by each employee with regard to the
quality and correctness of their work and, additionally, by the employees
superior and colleagues. Employee-Level Control is incorporated into
banking procedures and is performed by the Banks units (self-control
and hierarchical control).
The purpose of Risk Management Control is to define the methods of risk
measurement, to verify compliance with assigned limits, and to control
conformity of the units operations with the assigned risk and profitability
objectives. This control is performed by units other than those directly
involved in the management of the given process and not involved in any
business activity.
The purpose of Internal Audit (institutional control) is to examine, evaluate
and recommend improvements to the existing procedures and mechanisms of the Internal Control System and assess any violations of the
rules and procedures.
Institutional control is exercised through audits performed in accordance
with an officially accepted audit plan and unplanned ad hoc audits, as
well as remote controls. This control is performed in an objective and
independent manner by the Internal Audit team, which reports directly
to the President of the Management Board. The Internal Audit team also
prepares reports for the Supervisory Board.
The Bank exercises the control functions at its subsidiary companies
by having representatives in the Supervisory Board of each subsidiary.
The Pekao Groups companies apply uniform standards and rules of the
Internal Audit operation.
The Management Board is responsible for the development, implementation and regular revision of the policies, strategies and procedures of the
97

and Prohibition of Trading during
Restricted Periods
As regards prevention of unlawful use and disclosure of inside information
and ensuring that investors have equal access to information, the Bank
meets the high standards stipulated in the Act on Trading in Financial
Instruments of July 29th 2005 and the Act on Public Offering, Conditions
Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies of July 29th 2005, which implemented the
provisions of Directive 2003/6/EC of the European Parliament and of the
Council of January 28th 2003 on Insider Dealing and Market Manipulation (Market Abuse) into Polish law.
Pursuant to the provisions of the Act of Trading in Financial Instruments,
the Bank prohibits the use of inside information and any trading in the
Bank shares and financial instruments during restricted periods by any
persons having access to such information.
Protection of inside information and ensuring that investors have equal
access to information are among the basic duties of all the Banks employees. The manner of performing those duties and detailed procedures
in this respect are regulated by orders of the President of the Management Board, by virtue of which the following documents have been
introduced:
Regulations for performing obligations related to inside information and
disclosing information on trades in financial instruments related the
Banks securities, executed by the obliged persons (the Regulations);
Regulations for preparing and releasing by Bank Polska Kasa Opieki
S.A. of current and periodic information to be published by issuers of
securities admitted to public trading and
Rules to be followed in the identification and counteraction of the risk
of market abuse connected with financial instruments and rules of
conduct in the event of identification of market abuse.
Additionally, the Bank guarantees protection of personal data and protects
information embodying its business secret.

In order to prevent unlawful use and disclosure of inside information,
the Bank has established an inside information protection system whose
main purpose is to secure and protect documents containing inside
information, protect systems containing inside information and control the
circulation of documents containing inside information.
The Regulations currently in effect also include aprohibition on using or
disclosing inside information, or recommending or inducing another person to acquire or dispose of financial instruments on the basis of inside
information which relates to such instruments.
98
The above prohibition applies to all persons who hold inside information as aresult of performing various functions in the Banks governing
bodies, holding the Banks shares or having access to such information
in connection with their employment, practised profession, or amandate
contract or any other legal relation of asimilar nature, and in particular to:
1. members of the Management Board, the Supervisory Board, proxies or
attorneys-in-fact of the Bank, its employees, auditors or other persons
related to the Bank under amandate contract or any legal relation of
asimilar nature (primary insiders),
2. the Bank shareholders, and,
3. persons employed or holding posts referred to in item 1 in asubsidiary company or the parent company of the Bank, or bound with such
company under amandate contract or any other legal relation of
asimilar nature.
The Bank monitors compliance with the above prohibition in accordance
with the Regulations. The Regulations also define the manner of proceeding in the event of areasonable suspicion of unlawful use or disclosure of
inside information, non-compliance with the disclosure requirements or
entry into aprohibited transaction during arestricted period.
Prohibition of Trading during Restricted Periods

The persons described as primary insiders who have access to inside
information are not allowed to enter, during the so-called restricted
periods, into any legal transactions, for their own account or for the
account of athird party, which lead or might lead to the disposal of the
Bank shares, derivative rights attached to the Bank shares or financial
instruments related to such shares.
All the Banks employees are notified of the opening and closing dates of
restricted periods related to the publication of the Banks periodic reports.
The prohibition of entering into transactions does not apply if the primary
insider had no access to the financial data serving as the basis for the
preparation of agiven report.
A primary insider who undertakes investment activity during arestricted
period is liable to administrative sanctions.
Reporting Transactions by Obliged Persons

Pursuant to the Regulations, obliged persons are required to notify the Financial Supervision Authority and the Bank of any transactions, executed
by such obliged persons or by persons closely related to them for their
own account, involving purchase or disposal of the Bank shares, derivative rights attached to the Bank shares and other financial instruments
related to such securities, admitted or sought to be admitted to trading on
aregulated market.
Obliged persons include:

1. Members of the Management and Supervisory Boards and proxies of
the Bank,
2. other persons who hold management posts in the organisational structure of the Bank, have permanent access to inside information related,
directly or indirectly, to the Bank, and are authorised to make decisions
concerning the Banks development and business prospects.
The Bank promptly discloses the information it receives simultaneously to
the company operating the regulated market (Warsaw Stock Exchange)
and to the public in acurrent report prepared according to apre-defined
format and using the appropriate IT standards.
Relations with the External Auditor

Selection of the Auditing Firm to Audit Financial
Statements
Pursuant to art. 66 of the Polish Accounting Act, the selection of the
auditing firm to audit financial statement is made by the body approving
the entitys financial statements which is the Banks General Meeting of
Shareholders.
The auditing firm is selected by the General Meeting of Shareholders
on the basis of arecommendation prepared by the Supervisory Board
through its Audit Committee.
The auditing firm to be mandated to audit the Banks financial statements is selected in accordance with the relevant procedures applicable
at the Bank, in away that guarantees the auditors independence in the
performance of its responsibilities.
The Auditors Independence

In compliance with the European Commission Recommendation
2002/590/EC and Directive 2006/43/EC, the Bank and the Pekao Group
have internal regulations in place whose purpose if to guarantee independence of the auditors and reliability of the financial statements of the
Bank and its subsidiaries.
In accordance with the above regulations, no financial, business or employment relations, or other relations of any kind, including those resulting
from the provision of non-audit services, may exist between the auditor of
financial statements and the audited entity (that is the Bank or any of its
subsidiary companies).
The regulations include alist of prohibited services which may not be
mandated to the Banks auditor. The prohibited services include in particular: keeping accounting books and other services related to the preparation of accounting data or reports, development and implementation
of financial information systems, outsourced management of internal

control systems, advisory and other services concerning corporate
organisation, relating to personnel recruitment and training, management,
legal services and acting as arepresentative in court proceedings,
as well as other non-audit services and activities, such as legal advisory
and consultancy.
Agreements for the provision of permitted services concluded between
the Bank or any of its subsidiary companies and the auditor of financial statements have to specify the services in detail and meet certain
expressly stipulated conditions.
Credit Process for

the Management Staff and Entities
and Persons Related to the Bank
Pursuant to the provisions of the Banking Law, the terms of loans, bank
guarantees and sureties as well as other off-balance-sheet liabilities
assumed with respect to the management staff and persons related to
the Bank are defined in the Rules to be followed when granting loans,
issuing bank guarantees and sureties, and assuming other off-balancesheet liabilities with respect to members of the Banks Supervisory and
Management Boards, persons who hold managerial positions at the Bank,
and entities related to them, as well as persons included in the list of corporate officers. The Rules have been adopted by the Banks Supervisory
Board and introduced by virtue of an order of the President of the Banks
Management Board.
The Rules determine in detail the principles of the decision making
process as regards entering into transactions with the abovementioned
persons and entities, and they also specify levels of authority to make
relevant decisions, and limitations of the powers assigned to them. Specifically entering into atransaction with amember of the Management or
Supervisory Board or with entities related to them requires approval of the
Management and Supervisory Boards.
Members of the Banks Management and Supervisory Boards as well as
persons who hold managerial positions at the Bank and entities related to
them by equity or organisational links may use the Banks credit products
in accordance with the terms and conditions normally offered by the
Bank. In particular, in relation to such persons and entities the Bank does
not apply preferential interest rates; the credit risk assessment is made in
line with the methodology routinely employed by the Bank in the case of
agiven client segment and type of transaction.
With respect to entities related to the Bank the standard credit process is
used, while the decisions on entering into transactions are made exclusively by relevant authorities at the level of the Banks Head Office.
99
Together with the Great Orchestra

for the Great Cause
In 2012, the Great Orchestra of Christmas Charity (WOP), one of the biggest charities in Europe,
played for the 20th time. Every year the Orchestra collects donations and purchases the best medical
equipment for sick children. Bank Pekao S.A. has acted as The Orchestras Banker for 14 years.
In 2012, the Bank donated the highest ever amount of PLN 2m. Every year, the Banks employees also
make personal donations. On the Finale Sunday, almost two thousand of the Banks employees volunteer
to collect and count money in some 100 branches that are open across Poland. This is how Bank Pekao
shows its commitment to meeting real needs and supporting key social initiatives.
Bank Pekao S.A. Annual Report 2011 101
Pekao Szczecin Open
The International Mens Tennis Tournament Pekao Szczecin Open had its 19th edition in 2011.
Pekao Szczecin Open has evolved into a prestigious event, catalysing positive opinions among
both top-class players and tennis fans. The Bank has been supporting the tournament from
the very beginning. As it draws into the spotlight the beautiful town of Szczecin, it is a perfect
opportunity to promote the whole region. Through its commitment to this top rank sporting event,
Bank Pekao contributes to the development of Szczecin and the whole region of West Pomerania.
Introduction104
Mission Statement of Bank Pekao
104
UniCredit Integrity Charter

Shared Values as the Foundation of the Groups Identity
Initiatives Aimed to Ensure Adherence to the Integrity Charter
Integrity Charter and Stakeholders Relations
105
105
105
106
Investing in Human Capital

Human Capital as aKey Asset
Trainings and Professional Development
Development Programmes and Initiatives
Development Processes
Internship and Trainee Programmes
Remuneration Policy
Internal Communication
Corporate Values as Basis of Relations at Work
Relations with Trade Unions
Relations with Work Council
Workforce in Number
106
106
106
107
107
107
108
108
109
109
109
109
Our Customers
Improvement of Customer Satisfaction
Protection of Clients Interests
109
109
110
Business Partners Suppliers
111
Environmental Protection
Environmental Risk Associated with Lending Activities
Protection of the Polish Bison
112
112
113
Charity Activities
Marian Kanton Bank Foundation
Cooperation with the Great Orchestra of Christmas Charity
114
114
115
Promotion of Culture and Community Outreach Initiatives

Support of High Culture
Cultural Initiatives for the Employees
Social and Civic Initiatives
Support of Sport
116
116
118
118
119

Introduction
Corporate social responsibility is regarded by Bank Pekao S.A. as
aprinciple to be followed at all times. It represents apart of the Banks
underlying philosophy and is the foundation on which the Bank builds its
relations with the outside world, with due regard to the needs of all its
stakeholder groups: customers, investors, employees, business partners
and local communities.
The Bank operates in compliance with applicable laws, executed agreements, internal procedures and corporate governance principles. The
legal and compliance units are responsible for ensuring that internal
regulations and procedures and agreements under the civil law are in
line with generally applicable laws. The efficient internal control system is
there to prevent breaches of agreements and procedures.
The Bank abides by the corporate governance principles provided for in
the applicable laws, its Statute, the statutory by-laws and the corporate
governance standards adopted by the Warsaw Stock Exchange to be
followed by the companies listed on the WSE. The corporate governance
principles are discussed in detail in aseparate chapter.
The Bank also observes Good Banking Practices adopted by the General
Meeting of the Polish Bank Association, which constitute acode of ethical
conduct for the banking community in Poland. The document defines the
rules of conduct in relations of banks with customers, mutual relations
between banks, and abanks relations, in the capacity of an employer,
with its staff. The Bank has also implemented the Canon of Best Practices
on the Financial Market, adocument endorsed by resolution of the Polish
Financial Supervision Authority and recommended for adoption by banks
by the Banking Ethics Committee of the Polish Bank Association.
An integral part of consistent activities falling within the scope of the
Banks CSR strategy is social commitment. That part of the CSR strategy
involves building relations with society and advancing its development.
The Bank representing amodern approach to corporate social activity
`departs from one-off donations and ad-hoc responses to requests for
support, in favour of long-term social commitment, based on partnership
with selected organisations, with aview to solving certain clearly identified problems.
The two pillars of the Banks corporate culture and identity are its
mission statement, aligned with the mission of the UniCredit Group, and
the UniCredit Integrity Charter, which defines the Groups shared values
and relations with all its social partners (stakeholder groups).
Mission Statement of Bank Pekao

The mission statement of Bank Pekao, aligned with the mission of the
UniCredit Group, results from redefining the Banks objectives and identifying new ways of pursuing those objectives in the post-crisis reality. At the
core of the mission statement are the Banks employees, as those responsible for day-to-day implementation of the Banks objectives and for conducting the Banks business in amanner consistent with its corporate values.
We, Bank Pekao employees,

are committed to generating value for our Customers.
As aleading bank in Poland, we are dedicated
to the development of the communities in which
we live and to being agreat place to work.
We aim for excellence and we constantly strive to be easy to deal with.
These commitments allow us to create sustainable value for all shareholders.
The Banks overarching objective is to build sustainable value by offering

customers the best quality of service, introducing simple, easy-to-use solutions, creating awork environment conducive to personal development,
104 Annual Report 2011 Bank Pekao S.A.
ensuring satisfaction with work, reinforcing asense of pride in being part

of the organisation among the employees, and contributing to the betterment of local communities in which we operate.
UniCredit Integrity Charter
Trust
Fairness
Freedom to act
Reciprocity
Transparency
Respect
Shared Values as the Foundation of the Groups Identity

The identity of the UniCredit Group one of Europes leading financial
groups, of which Bank Pekao S.A. is amember is largely founded on
the pride in its geographical and cultural origins. While respecting the
cultural diversity represented by the employees of all the banks within the
Group, we want to be able to refer to the shared elements of our identity.
In order to establish the basis for cultural integration and afoundation of
communal identity among more than 160 thousand employees across
22 countries, the UniCredit Integrity Charter was accepted in 2006 and
implemented at all companies of the UniCredit Group. It comprises aset
of the fundamental corporate values, including fairness (fair treatment),
transparency, respect, reciprocity, freedom to act, and trust.
The Integrity Charter, as acode of corporate values, defines the rules of
conduct based on integrity, considered to be the guarantee of durable
transformation of profits earned by acompany into value. The Integrity
Charter is atool helping to reconcile the pursuit of profits acondition for
every entrepreneurs development and independence with the respect
for interests of all social partners.
The Charter identifies the values underpinning the relations with each
stakeholder group, and indicates the models of conduct to be followed.
Adherence to the Charter in social relations is conducive to sustainable

development, as it helps to build value for all stakeholder groups.
Initiatives Aimed to Ensure Adherence

to the Integrity Charter
A project called Justice with the Integrity Charter is the practical
application of the Integrity Charter by translating its values into real-life
situations and workplace relations. It is based on the idea of restorative
justice, which is implemented via Integrity Charter Ombudsmen.
The Ombudsmen are independent individuals selected from among
retired executives with awealth of experience gained while working
for the Bank, whose high ethical standards have won appreciation of
their fellow workers. The Banks employees can contact the Ombudsmen if they witness or are affected by abehavior which is incompliant with the values underlying the Integrity Charter. The role of the
Ombudsmen is to help solve problems resulting from non-adherence
to those values. They take steps to reconcile the conflicting parties
and restore the relation by using the available array of tools (a meeting, mediation, bringing the problem to the attention of the persons
concerned).
Corporate Social Responsibility (cont.)
The Ombudsmen disseminate information on their activities and promote

the corporate culture based on the Integrity Charter values through
publications in the Banks corporate magazine and direct meetings with
the Banks employees.
Every year, employees of the UniCredit Group companies celebrate the
Integrity Charter Day, which focuses on the shared identity, corporate
culture and corporate values. It is an occasion to reflect on and share the
experience related, among other things, to the Integrity Charter as the
foundation of the Groups identity both at the level of the Group and its
individual members.
In 2011, we also celebrated the UniCredit Day at Pekao, held under the
banner Sustainable Development Positive Change Every Day. The
event was an opportunity for all managers and employees to meet and
discuss the types of behaviour that foster implementation of the sustainable development strategy.
Integrity Charter and Stakeholder Relations

Bank Pekao S.A. is committed to pursuing the values enshrined within
the Integrity Charter, which contributes to the consistent building of trust
in its relations with all stakeholder groups and to high standards of doing
business.
Investing in Human Capital

Human Capital as aKey Asset
The principles of the Banks policy in the area of human resources (HR)
development are set by its mission and the values considered of key
importance for the Banks sustainable growth.
The Bank invests in training and professional development of its employees (in line with their potential and abilities), as well as creation of
afriendly work environment, and conducts surveys on employees views
and satisfaction.
A significant area of the Banks personnel policy is talent spotting within
the organization and investing in the development of their skills.
In 2011, those priorities were accompanied by aparticular emphasis
on promoting the key values of the corporate culture shared across the
UniCredit Group, as defined in the Integrity Charter, which was accepted
in 2006. The ethical fundamentals promoted by the UniCredit Integrity
Charter and the rules of conduct recommended by that document have
come to be considered as universal standards of behaviour required of all
employees of the Bank regardless of their position.
Trainings and Professional Development

Our employees can always count on stable terms of employment, fair
treatment, opportunities for professional advancement, as well as respect
for them and their civil liberties.
Taking care of the interests of our customers is our key priority. We seek
to be their bank of choice. We bolster their confidence by always improving the quality of our services and the security of transactions, offering
innovative products, transparency of our activities, mutual respect and
adequate protection of confidential data.
Our business partners (suppliers) are always treated with respect. We
exercise objectivity and impartiality when selecting suppliers by applying
clear and precisely defined rules in the process.
In our relations with shareholders and investors we observe the rules of
conduct consistent with our corporate values and professional ethics, in
line with the highest market standards.
The Banks responsibility for society manifests itself in its commitment to
sustainable development and CSR initiatives in such areas as environmental protection, charities, support of culture and socially-minded
projects.
The Banks training policy assumes investment in ongoing development of the employees through ensuring access to training as well as
implementing HR management systems based on aculture of feedback.
The Bank supported its employees in building and managing long-term
careers within the organization, providing them with various forms of
learning, competence development and internal promotion opportunities.
The Bank constantly expands its internal training programmes tailored
to the needs of the employees and ensuring professional services to
customers. Training programmes include classroom training, on-the-job
training, coaching and other forms of competence development.
In 2011, the Bank delivered 18.5 classroom training hours per employee.
Almost 13 thousand people, representing 74% of the Banks total headcount participated in the classroom training.
The total number of classroom training days in 2011 amounted to
40 thousand, which translates into 2.3 classroom training days per
employee on average.
In 2011, the main training priorities of Bank Pekao S.A. were:
professional skills development,
managerial training,
developing employees language skills.
Professional Skills Development

In 2011, the Bank continued the process of developing professional
knowledge of its employees. Approximately 12.5 thousand employees
took part in the training and over 70% of training courses were conducted
by internal experts.
Development Processes
The Bank launched three major training projects aimed at increasing

customer satisfaction as well as fostering sales and managerial skills
development of the Banks staff.
In order to achieve this goal, the Bank currently operates four main
processes:
Executive Development Plan (EDP) an annual appraisal process
for managers which consists of the following stages: effectiveness,
competence and potential appraisal step, development activities planning and realization step. 499 persons took part in EDP in 2011.
Talent Management Review (TMR) an annual appraisal process of
individuals potential and professional achievements, aimed at managing and development of talents at the Bank and the UniCredit Group.
The process is based on the Leadership Competency Model and is
composed of four key stages: identification, review, development and
verification. 365 persons took part in the process in 2011.
Key outcomes of the EDP and TMR processes are succession plans,
which are crucial for ensuring continuous employment at strategic
positions, continuity of long-term projects and minimizing operational
risk. The Bank designed succession plans for all key positions.
Pekao Talents (PT) atwo year programme dedicated to the Banks
employees with the highest potential, aimed at talent management and
development. 81 persons were nominated to take part in the Pekao
Talents process in 2011.
Annual Employee Appraisal System aprocess of evaluation of
the Banks employees which comprises appraisal of the employees
competencies, potential, personal development planning and business
goals appraisal. 16,194 employees took part in the process in 2011.
In 2011, the Bank initiated atraining programme co-financed by the

European Union, named Comprehensive Training Programme, as the
Way to Quality Changes at Bank Pekao S.A. The project covers language
courses, MS Office workshops and implementation of an age management strategy accompanied by managerial training in this area.
Managerial Training
A major goal of the main internal training programmes is to improve managerial skills and competencies and support the Banks business strategy
implementation. When pursuing this goal, the Bank took also advantage
of the expertise of UniManagement the UniCredit Groups leadership
development centre recognized for using an innovative approach to
professional development. The cooperation with UniManagement offered
an opportunity for the Banks employees to share knowledge and develop
their skills at the international level.
In 2011, 1.2 thousand employees participated in the managerial training.
Developing Employees Language Skills
The Bank invests in the development of employees language skills by
organizing individual and group classes, on-line courses and by refunding
apart of self-financed courses. Support in this area is provided to those
employees who use English in their everyday work.
In 2011, 330 employees participated in language courses.
Development Programmes and Initiatives

One of the key elements of employees professional development is
the Banks support in long-term career management within the Banks
structure. In 2011, the Career Management Project was launched for employees of all the Banks units. Under the project, career paths have been
designed. These include recommended standard transition paths between
groups of positions and position descriptions comprising, inter alia, formal
requirements, key competencies as well as technical and process skills
required to take and hold aspecific position. Career paths are included in
custom software combined with the Internal Job Market.
The Career Management Project covers implementation of overall rules
designed to ensure transparency and equal opportunities for all the
Banks employees in the process of internal recruitment.
One of the key priorities of the Banks development process is identification, review, verification and development of current and future leaders of
the Bank.
Furthermore, the Bank offers the following development initiatives focused on supporting the employees in their professional career development and improvement of their skills, knowledge and competencies:
Assessment Centre/Development Centre sessions, personality
tests and 180/360 Feedback diagnostic tools for the identification
of strengths and development areas of employees.
Job Rotation, Mentoring and Coaching dedicated to selected employees to give them broader business prospects and an opportunity to
gain new experience.
UniQuest, UniFuture and MBA in Banking initiatives held at
the UniCredit Group level, enabling employees to get international
experience.
Career Navigator atool that supports career development planning,
and the Internal Job Market dedicated to all Banks employees.
Internship and Trainee Programmes

The Bank offers students and graduates the following development
programmes:
UniChallenge atwo year-long internship programme, addressed to
talented last-year MA students and graduates. It provides opportunities
for its participants to gain work experience and professional knowledge

in aparticular field. The UniChallenge Programme is used to spot highpotential candidates for employees. In 2011, 15 participants took part
in the programme.
UniStart/UniSummerStart an apprenticeship programme addressed to students, who are offered placements for periods ranging
from one to three months. These programmes are an opportunity to
gain experience in different areas of banking, in all of the Banks divisions. In 2011, 454 participants took part in the UniStart and UniSummerStart programmes.
Remuneration Policy
On July 26th 2011, the Supervisory Board of Bank Pekao S.A. approved the Group Compensation Policy, which describes the general
framework and rules of development, monitoring and controlling of the
remuneration systems and practices applied by the Bank, and constitutes
the framework for detailed internal regulations of the Bank. The Policy
combines short- and long-term incentive systems into one system. It supports aconsistent approach to risk management and long-term business
sustainability.
Effective management of the employees remuneration is instrumental in
maintaining ahigh level of competitiveness of the benefits offered by the
Bank.
The main remuneration policy tools include:
retention plans,
incentive systems: Management by Objectives (MBO) and quarterly
bonuses,
additional benefits for employees.
The Corporate Collective Labour Agreement defines the rules of the

quarterly incentives programme, which applies to all employees covered
by the Agreement. Quarterly bonuses are granted on adiscretionary basis
and depend on an employees performance, quality and level of commitment to work within aspecific timeframe.
Additional Benefits for Employees
Additional benefits available to the employees vary according to the
position and responsibilities.
Employee Share Ownership Plan is the offer for all of the Banks employees to invest in shares of UniCredit S.p.A. on preferential terms. In 2011,
the third edition of the Plan was introduced at the Bank.
The Bank provides all employees with access to basic medical services.
The medical packages offered to the employees can be further expanded
on preferential terms to cover the employees family members.
The Bank offers also awide range of group life insurance for its employees and their family members.
The Bank makes contribution to the Social Benefits Fund, which is spent
on financial assistance to the Banks current and former employees.
The financial assistance from the Social Benefit Fund covers, inter alia:
funding to purchase sports, recreation, cultural, and educational
services,
funding for recreation,
providing financial assistance to employees who find themselves in
adifficult life situation,
loans for housing purposes.
Internal Communication
Retention Plans
In 2011, there were four main retention schemes operated by the Bank:
Long-Term Incentive Plans edition 2007-2011, 2008-2012 and
2011-2013, addressed to the top management,
Five-Year Loyalty Plan, addressed to employees of key significance
to achieving the Banks business goals and to the most promising
employees selected under the Talent Management scheme,
UniCredit Group Long-Term Incentive Cash Plan edition 20102012, addressed to the top management,
Retention Programme 2010-2013 alocal retention programme
dedicated to the key employees of the Bank.
Incentive Systems
The main incentive tool applied by the Bank is asystem based on
Management by Objectives (MBO). The system covers employees in the
front-office sales jobs and in jobs which play avital role in achieving the
Banks commercial goals. The employees covered by the MBO system
receive individual goals, whose successful completion determines the
amount of annual bonus.
Constant improvement of the quality and effectiveness of mutual relations

between the employer and the employees is apriority for the Bank.
Internal communication at the Bank relies on acomprehensive range of
tools and channels, including the intranet portal, the corporate magazine
ycie ubra, brochures and newsletters distributed by e-mail, Internal
Discussion Forum, and online chats with the Banks Management Board
members, managers and project leaders.
Since 2007, the Bank has run People Survey on aregular basis. The
purpose of this anonymous survey is to gauge the employees opinion on
many aspects of the organizations functioning, including clarity of goals
and objectives, quality of leadership and management, internal communication effectiveness, the Banks image, internal relations, effectiveness of
training and sense of affiliation with the organization. The response rate
in People Survey 2011 was very high: it amounted to 81%. The survey
results are used as abasis for preparation of specific action plans aimed
at improving employee satisfaction.
Corporate Values as aBasis of Relations at Work
Our Customers
The basis of the Banks corporate culture and identity is the Integrity
Charter. The Restorative Justice System, an initiative implemented at the
Bank in 2008, ensures practical application of the Integrity Charter in
everyday relations and in the work environment.
According to the mission statement of Bank Pekao S.A., at the very heart
of the Banks business is creating sustainable, long-term value for all the
stakeholders, among whom the customers have aspecial place. Satisfaction of our customers and meeting their expectations is the key priority for
the Bank.
The core of the system is the Integrity Charter Ombudsmen,who are

selected from among independent and experienced retired managers
of the Bank, to whom employees can report any instances of behaviour
inconsistent with the Banks corporate values.
The Ombudsmens actions are aimed at restoring positive relationships using available tools such as meetings, mediation, or bringing the
problem to the attention of the persons concerned. The Ombudsmen
also promote the corporate culture based on the Integrity Charter values
through internal publications, newsletters and during direct meetings with
the employees.
Relations with Trade Unions

In 2011, the interaction of the Bank with trade unions, which consisted in
consultation, negotiations and agreements was conducted in accordance
with the provisions of labour law, with due regard to the interests of all
parties and the principles of social dialogue.
Relations with Works Council

On May 11th 2011, the Works Council of Bank Pekao S.A. was elected
for the 2011-2015 term. The election was conducted under the Act on
Employee Information and Consultation of April 7th, 2006. On June 7th
2011, the first meeting of Works Council and the President of the Management Board of the Bank was held. The Bank pays strong attention to
the role of the Works Council in social dialogue. By the end of 2011, the
Works Council held six meetings, including three meetings with the employer. All issues agreed with the employer are published on the intranet
and are available to all of the Banks employees.
Workforce in Number
At the end of 2011, the Bank Pekao S.A. Groups headcount, including companies consolidated under the full method, totaled 20,357, as
compared with 20,783 employees at the end of 2010.
The Bank employed 17,921 people (a reduction by 355 in comparison
with the end of 2010) who are on average 43 years of age. 60% of the
employees are university graduates (59% in 2010). Women represent
80% of the total workforce.
We build sustainable, long-term value for our customers by continually

enhancing customer relations and an ongoing effort to understand their
everyday realities in order to respond to their needs and expectations with
specific tailor-made proposals designed to deliver tangible benefits.
The Banks mission statement places astrong emphasis on simplifying
the banking service as far as possible, by offering customers simple and
comprehensible solutions, reliable and effective in helping them attain
their financial goals.
In line with that approach, which we call real-life banking, we offer our
customers so much more than just financial services, we provide them
at the right time and in the right form with appropriate professional
support. It involves working closely with customers to help them define
their real needs and, drawing on our pool of specialist knowledge and
experience, design workable solutions through atwo-way communication
process based on openness and clarity.
For detailed information on the efforts undertaken by the Bank in 2011
to create value by offering customers best quality products and services,
see Activity of the Pekao S.A. Group. Below we discuss our customer
satisfaction improvement programme and certain issues related to the
protection of customers interests.
Improvement of Customer Satisfaction

In 2011, the Bank continued its comprehensive customer satisfaction improvement programme, paying particular attention to customers opinions.
As part of aCustomer Satisfaction Survey, nearly 60 thousand telephone
interviews were held with clients representing all segments.
Comments and observations elicited through the survey and relating to
the quality of the Banks service are carefully reviewed to be used as
abasis for specific response aimed to bring the service model in line with
the clients expectations. The scale of the project enables to gather very
precise data and take into consideration distinctive features of particular
local markets.
The result of the Customer Satisfaction Survey, as astatistical tool, is
anumber expressed as aTRI*M index, which is an important element of
an assessment of the Banks activity.
Additional surveys were launched in 2011, as part of which the customers presented their views on their experience of using banking services.
The surveys are atool to measure customer satisfaction with sales
and/or service processes and identify those aspects of the processes
that require improvement.
Furthermore, in 2011 aseries of workshops were held at the Banks outlets, whose purpose was to look for even better solutions further increasing the quality of service and reinforcing customer-centered culture.
One of important elements of Bank Pekao S.A.s strategy is seeking employees views. Since 2009, the Bank has continued the initiative called
Day at the Branch. Twice ayear agroup of key managers from the Banks
Head Office visit the Banks branches to meet with the employees. They
discuss their mutual cooperation, with afocus also on improvements
that could add to the quality of services, improve customer relations and
ensure that customers needs are met as closely as possible.
Another valuable source of information on the areas which call for improvement are customers complaints. The Bank makes an ongoing effort
to enhance and optimise the complaint resolution process. For instance,
solutions have been implemented to facilitate submission of complaints
by the customers, increase the quality of complaint resolution, and
shorten the time required to complete the resolution process. An analysis
of the sources of customers dissatisfaction makes it possible to remove
the causes of the complaints.
Every year the Bank conducts an annual Reputation Survey, being
aframework linking the other surveys and giving an insight into the perception of the Banks activities. In 2011, the Reputation Survey involved
gathering opinions of the employees and customers of Bank Pekao S.A.,
customers of competitor banks, and representatives of local communities.
The respondents assessed their level of confidence in the Bank, as well
as the Banks reliability, the esteem it enjoys and the general impression
it makes. They also shared their views on such areas as products and
services, innovation, the Bank as the place of work, management, CSR
activities, leadership, and business performance.
The Reputation Survey held in 2011 confirmed the strong position of
Bank Pekao S.A on the Polish financial market.
protecting its clients against the currency risk, which hit many households
severely when the zoty exchange rate plummeted.
Following full implementation of the MiFID Directive at the Pekao Group,
the Banks employees assess the investment knowledge and experience
of customers in order to provide them with information needed to make
informed investment decisions.
Concurrently, the Bank implemented asuite of measures at the management and organisational levels aimed to increase the scope of clients
protection aconflicts of interest management policy, aclient classification/reclassification policy, and rules governing investment by the Banks
employees for their own accounts.
Another step towards ensuring informed investment decisions and protection of individual customers against undertaking excessive investment
risk was the implementation of the Investment Navigator in the affluent
clients segment in 2011. This state-of-the-art tool can be used to prepare
individual financial plans for each customer, taking into account the level
of investment risk the customer is prepared to assume and the investment
horizon. Each investment objective of acustomer is presented in the form of
aclear graphic simulation and discussed in detail by the Banks employee.
In the area of corporate banking, in 2011 the Bank continued to apply
best practices following from the implementation of the MiFID Directive.
After anearly two-year decline on the market, 2011 saw renewed interest in advanced financial products. This trend shows that the customers confidence is growing, which is attributable to the MiFID initiatives
undertaken at the Bank.
In addition, intense work was underway at the Bank to carry into effect
the provisions of the Payment Services Act of October 24th 2011,
implementing Directive 2007/64/EC of the European Parliament and of
the Council on payment services in the internal market. The Directive contributes significantly to the protection of customers interests by imposing
numerous new obligations on providers of payment services.
The Bank protects the interests of its clients, safeguarding their deposits
and ensuring security of transactions executed in their accounts. Information relating to clients is protected in line with the security and confidentiality standards put in place by the Bank.
Protection of Clients Interests

Regard for the interests of our clients is the main principle underlying the
Banks operations.
The security of funds which clients entrust with us is our top priority. The
solutions offered by the Bank are among the most advanced, secure,
user-friendly and convenient.
It is the Banks goal to ensure that when purchasing aproduct or service

aclient correctly understands its value and is aware of the related risks.
This is particularly important now, given the substantial growth of risk
following from the development of increasingly more complex financial
instruments. For anumber of years, the Bank has consistently refrained
from granting mortgage loans in foreign currencies, thus effectively
In developing its modern web platforms (Pekao24, PekaoFIRMA24 and

PekaoBIZNES24), the Bank took care to ensure that they are convenient to
use and absolutely secure. Account access is protected by amulti-layer
security system. Bank Pekaos electronic banking systems guarantee
security of personal data, security of funds held in the accounts, and
security of executed transactions.
In the Pekao24 system dedicated to individual customers, in 2011 the

Bank introduced hardware tokens as an additional solution for authorising
transactions, complementing the existing authorisation methods (PekaoToken, SMS codes, and single-use code cards) and affording ahigh level
of security. At the same time the users of the PekaoToken authorisation
method, based on aspecial application for mobile phones, were offered
anew version of the application for handsets supporting the Android
system. The new version can be used without installing any additional
software.
Business Partners Suppliers

The Bank chooses its suppliers of products and services in an objective
and unbiased process, paying mind to good and fair commercial relations.
The Bank respects its business partners and their commercial practices.
When purchasing goods and services the Bank is guided by internal
procedures, compliant with both Polish regulations and best practices
applied by the UniCredit Group.
Bank Pekao was the first bank in Europe to have introduced the innovative method of biometric user authorisation in its transactional system
dedicated to corporates. Users of PekaoBIZNES24 log into the system and
authorise their transactions using their fingerprints. The solution incorporates the best available security standard, while being user-friendly and
convenient.
In the procurement procedures, the Bank takes care to ensure that the
specification of the ordered goods or services is the same for all business
partners and includes objective technical and quality parameters, to
guarantee fair competition. Any company may be invited to participate
in aprocedure and to submit abusiness proposal meeting the Banks
requirements.
In 2011, guided by the objective of ensuring highest security of customers transactions executed via the PekaoBIZNES24 system, the Bank upgraded the system with arange of new functionalities affording increased
data security.
All companies which submit their initial proposals are registered in the
Banks database of suppliers and are taken into consideration during the
compiling of alist of suppliers to be sent auniform invitation to submit
aproposal. The companies invited to participate in the procedure can
make inquiries related to the received specification. To ensure equal
access to information, replies to the inquiries are distributed among all
the companies invited to participate in agiven procedure. The companies
are entitled to withdraw or alter their proposals before the expiry of the
submission deadline.
The cutting-edge and highly secure electronic banking solutions of Bank

Pekao S.A. have met with strong appreciation of experts, as evidenced by
the numerous awards and distinctions earned by the Bank.
The Bank continuously enhances the employed procedures and takes
necessary actions to promptly react to complaints lodged by its clients
and addresses them in such away as to take into account to the fullest
extent possible legitimate interests of its clients.
If there any differences of opinion occur, clients have the right to refer to
the Bank Ombudsman associated by the Polish Bank Association with
arequest to resolve the case. The Bank Consumer Arbitration was established to resolve disputes between consumers-clients and banks with
respect to financial claims resulting from non-performance or improper
performance by the bank of banking services or other services rendered
to consumers (out-of-court arbitration proceedings). The Bank Ombudsman reviews disputes whose value does not exceed PLN 8 thousand. The
awards of the Bank Ombudsman are final and binding to the Bank but not
to the consumer. The consumer who is not satisfied with the award may
pursue his claims in court.
The parties (the client and the Bank) may also refer to the Arbitration
Court of the Polish Bank Association for resolution of any contractual disputes that arose between them. The competence of the Arbitration Court
to resolve agiven dispute results from awritten agreement between the
parties indicating the subject of dispute or the legal relationship which
gave or may give rise to dispute (arbitration clause).
To ensure an unbiased selection process of suppliers of goods and

services the Bank appoints Committees that prepare arecommendation
of the best proposal.
The Bank uses the following criteria in the selection process:
price,
quality,
reliability and experience of the prospective supplier.
In the case of outsourcing services (within the meaning of Art. 6a-6d of
the Banking Law), the procurement procedure is subject to additional
requirements defined in internal regulations of the Bank. The bidders
are required to submit additional documents concerning their economic
and financial standing, disaster recovery plans they have in place, as
well as documents evidencing protection of data entrusted to them.
This information is analysed in detail by dedicated units of the Bank in
terms of financial and operational risk, information security, business
continuity, and compliance with applicable laws. Close cooperation is
maintained between the outsourcing company and the Bank, and the
contract performance is monitored on aregular basis. The contracts
signed with the outsourcing service providers selected in tender procedures contain provisions which facilitate the performance by the Polish
Financial Supervision Authority of certain regulatory actions required
under Banking Law.
In accordance with the procurement rules applied at the UniCredit

Group, the Bank is consistently increasing its reliance on negotiations
by electronic means (Internet auctions), thanks to which the procedure
can have alocal, national or international reach. asignificant advantage
of this solution is enhanced clarity and transparency of the negotiation
and selection process, in which, when need arises, other criteria can be
applied in addition to the transaction price, including quality assessment
criteria, equal for all participants and communicated to them prior to the
beginning of the negotiations. The results of agiven procedure are sent to
all participating bidders.
The Bank aims to ensure compliance with the Green Procurement Policy
applied across the UniCredit Group. Since 2010, the suppliers participating in tender processes run by the Bank must complete aCSR form, in
which they provide information concerning environmentally conscious
management, social responsibility standards and labour-law compliance.
In some cases abusiness relationship with service providers is regulated by framework agreements executed on the UniCredit Group level.
In particular, this arrangement is used in the case of all-important IT
products and services for the banking sector. An agreement is signed with
aprovider only after atender procedure, addressing the specific needs
and circumstances of the Groups bank, has been completed. On the basis of such agreements subsidiary contracts are executed, which contain
detailed terms of contract delivery on the local market.
Environmental Protection
The UniCredit Group has an Environmental Policy in place and is therefore
committed to taking environmental sustainability into account when
making decisions on strategy. This means operating while striving to
prevent the most serious direct impacts on the environment (energy,
paper consumption and waste production) and ensuring that the impact
of outside entities that is scrutinized to the extent possible (credit policies,
pro-ecological project financing).
Bank Pekao S.A. supports sustainable growth by managing its direct environmental impact (as abusiness entity), by indirect influence (financing
of environmentally-friendly technologies), as well as by backing certain
projects aimed at protecting specific natural resources.
In cooperation with UniCredit S.p.A., the Bank makes every effort to
constantly increase its corporate social responsibility standards. Definition
of guidelines to be followed by the Banks employees when selecting
providers of goods and services is also means to this end.
With the protection of the natural environment in mind, when procuring
supplies for its own needs the Bank makes an effort to purchase environmentally friendly goods and services.
For instance:
the Banks car fleet comprises only cars which meet the EURO4 and
EURO5 emission standards,
printers used at the Bank are being replaced with energy-efficient
devices that are manufactured in an environmentally friendly way and
have the required environmental certificates,
white envelopes used for the Banks correspondence are marked with
the FSC/PEFC logos, which means that they are made of environmentally friendly paper produced from renewable resources.
With the natural environment in mind, and taking care to reduce paper
consumption and preserve forest resources, in 2011 the Bank prepared
acampaign called Squirrels will Be Grateful to You. Its purpose was to
induce clients to use electronic account statements rather than paper
ones.
Information on the possibility of opting for electronic account statements
and the resultant benefits was included in the statements sent to clients,
placed on the Banks website, and distributed in special leaflets.
We prepared aspecial promotional offer for those clients who decided
to give up using hard-copy statements during the campaign. Clients who
chose to opt for the electronic version of documents could receive two
free tickets to one of five national parks.
As aresult of the project, more than 100 thousand clients gave up paper
account statements, mindfully contributing to reduced paper consumption. All in all, our various initiatives encouraged 250 thousand clients of
the Bank to switch to electronic account statements in 2011.
Environmental Risk Associated with Lending Activities

Bank Pekao S.A. is implementing an environmental awareness policy
which follows from the United Nations Environment Programme Finance
Initiative (UNEP FI) concerning natural environment and sustainability,
considering environmental impact factors in performing credit risk analyses of its transactions and in transaction monitoring processes.
In its day-to-day activities Bank Pekao S.A. is strongly committed to protection of the environment. Environmental risk assessment is one of the
crucial factors in evaluating credit transactions executed with businesses.
It involves anumber of steps: from review of acustomers business
profile and preparation of apreliminary environmental risk assessment,
to assessment proper, which includes an on-site visit and review of
documents relating to the environmental aspects of an undertaking, to
management phase, which includes acredit decision and agreement
execution, to monitoring of environmental risks.
If aborrowers business profile entails environmental hazards, Bank
Pekao S.A. works with the customer on reducing the potential implications
of the environmental risks. They cooperate to identify such risks, assess

their scale and mitigate their potential impact. Such cooperation, which
forms part of credit risk assessment, relies on the methodology and
industry guidance developed by the European Bank for Reconstruction
and Development.
If the Bank establishes that acustomer is unable to minimise its environmental risks, it defines certain conditions to be met during the transaction term,
also by including relevant environmental provisions in the loan agreement.
The Bank does not finance certain types of business activities on environmental grounds. Such activities are enumerated in the Environmental
Exclusion List drawn up on the basis of international standards, including
the Convention on International Trade in Endangered Species (CITES).
Furthermore, the Bank refuses to finance trade in goods representing
environmental hazards or projects violating health and public safety laws.
The Banks credit risk policy prohibits it to finance production of military
equipment, nuclear power projects and activities which may be asource
of major environmental hazards. Any exceptions to that policy require
the approval of the Management Board and apositive opinion of the
Supervisory Board.
In line with its credit policy, the Bank supports projects with environmental benefits.
Protection of the Polish Bison

Bank Pekao S.A. has extended special protection to the Polish bison, an
animal closely associated with the Banks image by its presence in the
logo representing astylised bison.
Commitment to the protection of the Polish bison is an essential factor in
the development and promotion of the Banks corporate social responsibility in various aspects of social life, including ecology. The Banks
commitment to this cause contributes to tightening the bonds between
various organisations engaged in protection of the Polish bison and to
developing effective ways of caring for this unique natural treasure, which
the bison herds are to Poland.
In Poland the bison has always been aroyal, dominating animal. The
symbol of quiet strength. The species survived thanks to the dedication of scientists and environmentalists, and today it is protected by
law and receives special attention of the public. As asociety we are
coming to appreciate the importance of living in harmony with the natural
environment. (Wanda Olech-Piasecka, PhD, Polish Bison European
Environmental Heritage, aleaflet included in the Annual Report for 2006
of Bank Pekao S.A.)
The Banks involvement in the protection of the Polish bison has
amany-year tradition. The financial support extended to institutions
and organisations engaged in the bison protection has long served the
purpose of ensuring proper conditions for the bison herds living at large
as well as those kept in zoos.
In 2011, the Bank continued to offer its support to five organisations
devoted to conservation of the Polish bison:
National Park of Biaowiea,
Wildlife Society of the Province of Szczecin,
Panda Foundation for Warsaw ZOO Development,
Toru Zoobotanical Garden,
Society of Bison Lovers.
The Banks cooperation with the National Park of Biaowiea commenced in 2004 with acelebration of the Year of the Bison, marking the
75th anniversary of the bison reintroduction to the Biaowiea Forest. For
eight years the Bank has been making donations towards the feeding and
maintenance of the bison herd living at large in this area.
Since 2005, the Bank has also been helping maintain the herd living
at large in the Szczecin Province. The herd was put in the care of the
Wildlife Society of the Province of Szczecin. The funds we donated in
2011 were used to feed the animals.
The cooperation with the Panda Foundation for Warsaw ZOO Development, which started in 2002, has been continued as part of the Banks
support programme for bison herds kept in zoos. All donations we made
by the Bank to the Foundation are allocated towards the maintenance
costs of the bison at the City Zoological Garden in Warsaw. Aboard providing information on the Peaks support given to the bison herd kept in
the Warsaw Zoo can be seen in the immediate proximity of the bison pen.
The Banks involvement with the Toru Zoobotanical Garden dates back
to 2004. All funds provided by the Bank to the organisation have been
helping maintain abison herd.
The object of the Society of Bison Lovers is to promote the Polish bison
conservation efforts. The Banks aid helps support educational, publishing
and description initiatives.
The Society has been active since 2005. Its members include scientists
and persons professionally involved in the care for the bison, for which
animal care is ajob and apassion. The Society has established cooperation with anumber of international organisations, including the European
Association of Zoos and Acquaria (EAZA), Large Herbivore Foundation
(LHF) and Bison Specialist Group, operating under the Species Survival
Committee of the World Conservation Union (IUCN).
The Society has been entered in the list of non-governmental wildlife
conservation organisations, and is chaired by Wanda OlechPiasecka,
Ph.D., professor at the Warsaw University of Life Sciences (SGGW) and
the chairperson of the Bison Specialist Group.

Charity Activities
Marian Kanton Bank Foundation
The Bank engages in charity work through the Marian Kanton Bank
Foundation. Serving as avehicle through which the Bank fulfils its CSR
mission, the Foundation supports both social organisations and individuals in need.
The scope of the Foundations charity and social activities is very wide
and its statutory objective is to support initiatives in the following areas:
education of children and young people,
scientific, R&D and teaching projects undertaken by academic institutions and schools,
promoting knowledge in the field of banking,
helping the ill and the disabled,
promoting physical activity and sport,
environmental protection,
projects and activities undertaken by charities,
promoting culture.
Established fifteen years ago, the Foundation has already donated to
charities ca. PLN 15m. The year 2011 when the whole world continued
to struggle with the financial and economic crisis was exceptionally
challenging for charities, as the stream of donations significantly declined.
The Foundations Management made every effort to spend the grants
provided by the Bank in the best possible way, primarily to help children,
youths and people in need of support because of adverse personal
circumstances or health problems.
In line with the intention expressed by the Bank as the founder, since
2005 the Foundation has helped fund merit scholarships awarded to
talented pupils and students from poor backgrounds. Beneficiaries of the
scholarships are primarily students of fields related to economics, law and
administration. The Foundation has continued cooperation with the universities in Krakw and Pozna, as well as the Maria Curie-Skodowska
University in Lublin, the Catholic University of Lublin, the Warsaw University of Technology, the Family Alliance School and the Gdask Banking
Academy. Overall, the Foundation has provided scholarship assistance to
approximately 300 pupils and students.
Furthermore, the Foundation provides financial assistance to organisations supporting institutions of higher learning. In 2011, it donated funds
to the Foundation of Rzeszw University of Technology and to the Society
of Friends of Opole University of Technology.
Over the seven years of its cooperation with universities, the Foundation
has come to be appreciated by academic circles as areliable and prized
partner in the education of young people.
The Foundation also supports initiatives promoting banking knowledge.
In 2011, as in the previous years, it lent support to the organisers of
another edition of the Young Economist competition, whose objective is

to promote the development of ambitious and talented young economists
with outstanding knowledge, and to build economic awareness among
the young generation, who will soon have tangible influence on the
development of our country.
Committed to acomprehensive development of younger generations, the
Foundation also supports anumber of initiatives which are not directly
related to education. In financing projects intended to meet the needs
of children, co-sponsoring several dozen holidays and excursions every
year, funding scholarships for talented students, purchasing computers
and teaching aids for village and small-town schools and providing funds
to libraries in such schools, the Foundation not only aims at relieving
immediate needs, but also contributes to ensuring equal opportunities for
children and young people from underprivileged backgrounds.
Nearly athird of the Foundations resources in agiven year is usually
applied to finance summer and winter holidays for youngsters as well as
stays in rehabilitation centres for ill and disabled children. Help in this
form is provided to residents of childrens homes, patients of centres for
disabled children and youth, and students from small village schools.
Thanks to this help, they can experience adifferent climate and environment, and learn about foreign cultures and ways of life.
The Foundation also supports the activities of sports clubs, whose main
objective is to promote physical exercise among youngsters, popularise
active lifestyles and contribute to proper physical development. The range
of sporting events co-sponsored by the Foundation is very wide, from
international football tournaments, to chess tournaments organised at the
commune level. One of the projects that benefited from the Foundations
assistance in 2011 was the sporting event under the name Athletic
Village, organised by the Polish Athletics Association for disabled youth
and residents of childrens homes. The event took place at the time of the
World Championships in Athletics held in South Korea.
Another important area of the Foundations activity is to furnish village libraries, schools and cultural centres with equipment, especially computer
hardware and software, in order to smooth out educational inequalities
and improve the pupils future prospects in life.
The Foundation is making an effort to have its own network of contacts
and to reach directly those in the greatest need, in order to fund specific
purposes. Financial aid offered by the Foundation is frequently targeted
at individual recipients to help them fight adisease or to realise their
dreams.
In exceptional cases, the Foundation engages in efforts designed to aid
the Banks employees and their relatives. In 2011, it offered financial
support to all persons, primarily disabled children of the Banks employees, covered by the year-round charity initiative run by the Bank under the
name Lets Help One Another.
Over the many years of its activity, the Foundation has established alasting cooperation with regular recipients of its financial aid. Thanks to those
long-standing relations and support for avariety of initiatives, the Foundation is able to gain in-depth knowledge of the beneficiaries and ensure
that they receive optimal help. The regular recipients of assistance provided by the Foundation include state-run and family childrens homes,
certain organisations and associations (including Caritas, Monar-Markot
and Childrens Friends Association), village schools and kindergartens,
parishes, single mothers homes, day-care centres, and hospices. In
many cases, small institutions dedicated to the support of Polish families
come to depend on the Foundations assistance in order to exist.
In so far as possible, the Foundation also extends its support to initiatives
aimed at developing an awareness of culture and national heritage. In
2011, it assisted the Cracow Saltworks Museum Wieliczka in organising
the 12th International Plein Air of Disabled Artists.
Cooperation with the Great Orchestra of Christmas Charity

Among the CSR initiatives undertaken by the Bank, the cooperation with
the Great Orchestra of Christmas Charity Foundation (Wielka Orkiestra
witecznej Pomocy WOP) is the one with the largest reach. It is
avital part of one of the core areas of the Banks sponsorship and social
responsibility strategies, namely providing aid to children in need.
WOP is the largest non-governmental charity in Poland, whose aim is
to save lives and health of children. The Foundation organises public
fundraising events under the name Grand Finale of the Great Orchestra
of Christmas Charity. The collected funds are applied primarily towards
purchases of specialist state-of-the-art medical equipment for public
hospitals for children. Since its inception, WOP has spent approximately
USD 140m on medical equipment, which is now used in hospitals
throughout Poland. It purchased over 20 thousand modern medical devices with the funds it collected. Another key objective of the Foundation
is to promote health and illness prevention.
In pursuance of the objectives set forth in its charter, the Foundation is running five nationwide medical programmes and one educational initiative (for
more details visit the Foundations official website at www.wosp.org.pl):
National Early Cancer Diagnostics in Children Programme The
overriding objective of the Programme is radical improvement in the
detection rate of cancers in children in the first stadium of the disease,
when there is still achance of full recovery. As part of the programme,
80 early cancer diagnostic centres have been set up all over Poland.
Diagnostics laboratories and oncology clinics have been equipped with
state-of-the-art ultrasound scanners. Specialist medical equipment
(the most advanced CT scanners) are being donated to the major
oncology clinics across Poland, which facilitates early and precise
diagnosis of medical conditions first detected by the ultrasound. The
programme also aims to raise cancer awareness among parents and
general practitioners by publicising awareness campaigns.
Universal Neonatal Hearing Screening Programme under which

hearing screening tests of newborn babies are made free of charge
at neonatal wards. The tests help detect ahearing impairment at an
early stage, and then treat it or stop its progress. Since the launch of
the programme in 2002, more than three million newborns have been
examined for hearing deficiencies thanks to the WOP-sponsored
equipment and training of medical personnel.
Retinopathy of Prematurity Prevention and Treatment Programme
diagnostics and treatment of children whose premature birth resulted in damage to the retina. WOP has provided neonatal intensive
care units with 98 direct ophthalmoscopes, and 15 eye clinics have
been equipped with the advanced laser photo coagulators.
Infant Flow Non-invasive Breathing Aid Programme The
Programme is designed to limit the invasive (mechanical) ventillatory
support of prematyrely born babies and newborns, which frequently is
acause of severe lung disorders. As part of the Programme, the Foundattion purchases and donates to hospitals equipment for non-invasive
ventillatory support for newborns.
Personal Insulin Pumps in Diabetic Children Therapy Programme
(programme closed) the insulin pumps sponsored by WOP have
given children and pregnant women suffering from diabetes achance
to lead more active and more comfortable lives.
Insulin Pump Diabetic Pregnant Women Therapy Programme
The purpose of the Programme is to improve the system of medical
care for diabetic pregnant women by developing standards of
administering insulin pump therapy in pregnant women and women
planning pregnancy. The Programme is run under the patronage of
the Polish Diabetologic Society. The insulin pumps purchased by the
Foundation are lent free of charge and give pregnant women suffering from diabetes achance to lead more active and more comfortable lives.
CPR for Schools Programme an educational initiative designed to
offer CPR courses to primary school teachers, who in turn pass the
newly learned knowledge and skills to their pupils. As part of the Programme, the Foundation donates teaching aids to schools (including
phantoms, textbooks and DVD records). To date some 23.5 thousand
teachers from approximately 12 thousand schools have received training, while the number of children covered by the programme is over
one and half amillion.
Since 1999, Bank Pekao, as the Great Orchestra of Christmas Charitys
Banker, has supported the Great Orchestra of Christmas Charity Foundation in organising the annual Great Finales, which include public collection
of donations and various other events, making up one of the largest
charity initiatives in Europe.
On Sunday, January 8th 2012, the Great Orchestra of Christmas Charity
played for the twentieth time. During the 20th Grand Finale the WOP
Foundation collected funds to finance purchases of insulin pumps
for pregnant women and equipment saving lives of prematurely born
babies.
Bank Pekaos donation to WOP was PLN 2,000,000, double the amount
donated ayear earlier.
The Bank was involved in the event as the Great Orchestra of Christmas
Charitys Banker for the fourteenth time. Some 2,000 of our employees
volunteered to assist in the 20th Grand Finale, the number having risen
compared with the previous years. Around 100 Pekao branches across
Poland opened on January 8th to collect and keep records of the donated
funds. For the occasion the Bank also prepared aspecial payment card
for Eurokonto accounts. By actively using the card, the cardholders will
support the Great Orchestra throughout the year. The Pekao volunteers
were to be seen everywhere on the main squares of towns and cities,
at the concerts, and at the WOPs headquarters.
Just like in the previous years, the Banks employees, greatly assisted
by members of the Management Board, spent the day at the television
studios of the Second Channel of the Polish Television (TVP2), counting
and sorting out the donations brought in by the Orchestras volunteers.
The official opening of the 20th Grand Finale took place in Zakopane.
During the opening event, Luigi Lovaglio, President of the Banks Management Board, donated aticket for the opening match of the 2012 UEFA
European Football Championship as acontribution from Pekao to be sold
at the WOP auction.
During aspecial broadcast on TVP2 summarising the Grand Finale
activities, President Luigi Lovaglio, accompanied by the Banks Management Board, presented the Foundation with asymbolic cheque for PLN
2,000,000. President Lovaglio also expressed his thanks to the Banks employees who counted money from the morning. Money is not everything.
Pekao gave something special to the Great Orchestra of Christmas Charity
the hearts of our employees. This is an invaluable gift, said Mr Lovaglio.
In many towns the Orchestras headquarters were located in Pekao
branches. In aWrocaw branch, aTeddy Bears Hospital was organised
together with students of medicine. The purpose of the project was to
convince little patients that doctors white coat is not to be feared.
As in the past, the Banks employees not only volunteered to count and
safekeep the collected funds, but also participated in the event by donating their own money to aspecial Gift Matching account. The collected
amount was again doubled by the UniCredit Foundation.
Promotion of Culture and Community

Outreach Initiatives
Customarily, the Bank provides financial and organisational support to
various community outreach and cultural initiatives. As in previous years,
the Bank sponsored events with a long tradition and international reach
and projects with a lower profile, but nevertheless important to local communities, as they improve the conditions and quality of their lives.
Support of High Culture

One of the main focuses of the Banks sponsoring strategy is the support
of high culture.
We are very happy that our many years commitment and activity have
met with recognition and appreciation: Bank Pekao was the only commercial company distinguished by Minister of Culture and National Heritage
with the title Patron of Culture 2011. Importantly, the Bank had been
put forward as a candidate for this prestigious award by our partners
more than 20 cultural institutions from all over Poland. This is a genuine
source of pride for us.
As a leading financial institution, Bank Pekao S.A. considers its patronage
of high culture as a real value, believing that it contributes to improving
the quality of life of the society. The public crowding the exhibition halls,
concert halls and theatres all the places where we have committed our
support makes us proud and happy with what we do as a patron of
culture.
In 2011, the Banks support of high culture was extended to numerous
projects, of which the most important are discussed below.
Musical Events
Wratislavia Cantans
The International Festival Wratislavia Cantans is one of the largest
festivals in Poland. First organised in 1966, it evolved from its original
format consisting of oratorio and cantata concerts to include symphonic and chamber music concerts, vocal and instrumental recitals,
and other art performances. The Festival takes pride in that it presents
the cultures of many nations, being the venue of concerts of sacred
music from different religions and presentation of works of plastic arts
from all periods, styles and cultures. Every year in September more
than two thousand performers from all over the world give concerts in
the impressive historical buildings of Wrocaw and more than a dozen
towns of Lower Silesia. In 2011, the Bank was awarded the title of
Silver Sponsor of the Festival.
15th Ludwig van Beethoven Easter Festival
From the very beginning the Festival gained the reputation of a very
prestigious musical event. The first Ludwig van Beethoven Easter
Festival was held in 1997, the year marking the 170th anniversary of
the composers death, as part of the Europen City of Culture Krakw
2000 programme. It was initiated by Elbieta Penderecka, the wife
of Krzysztof Penderecki, a famous Polish contemporary composer
and conductor. Its subsequent editions came to be some of the most
important musical events in Europe. Since 2004, the event has been
organised in Warsaw by the Ludwig van Beethoven Association. The
fifteenth, jubilee edition of the Ludwig van Beethoven Easter Festival in
2011 referred also to two anniversaries of other renowned artists: the
200th anniversary of Ferenc Liszts birthday and the 100th anniversary
of Gustav Mahlers death.
Concert of Orchestra Filarmonica Della Scala

The concert was an important event in the musical life of the Polish capital.
It took place at the National Philharmonic in Warsaw in March 2011. The
concert was part of the celebrations for the 150th anniversary of the Italian
Unification, and was attended by many distinguished guests. UniCredit, the
strategic investor of Bank Pekao, has been a partner of Orchestra Filarmonica Della Scala since 2000, and in 2003 it became its main partner. In
addition to partial funding of the traditional concert season, the UniCredit
Group also sponsors the Orchestras tours of different European countries.
The Warsaw concert of the Orchestra was conducted by Stefano Ranzani.
The audience had an opportunity to listen to the most beautiful pieces of
music by various composers, including Rossini, Verdi and Puccini.
Premiere of Karol Szymanowskis Opera King Roger
In 2011, for the first time from its accession to the European Union in
2004, Poland took the presidency of the Council of Europe. The inauguration of this historical event was accompanied by the premiere of
King Roger, an opera by a Polish composer Karol Szymanowski. The
Bank was the exclusive sponsor of the performance, staged on July
1st 2011 at the Polish National Opera. King Roger is the only opera
written by Karol Szymanowski that has earned international recognition
and is played in operatic theatres in various parts of the world.
16th Festival of Polish Composers
The event has been organised annually for 15 years under the aegis of
the Ministry of Culture. Its 2011 edition was devoted to commemoration of Henryk Mikoaj Grecki, a Polish composer and an honorary
patron of the project, who died in 2010. An additional concert was held
as part of the Festival the Inauguration Concert during which the
Festival was conferred the name of Professor Grecki. The theme of
the Festival in 2011 was works of Polish composers of film music.
It included compositions by the most eminent Polish composers, which
received numerous awards and are admired by music lovers. The
music was performed by the Orchestra and the Choir of the Silesian
Philharmonic of Katowice and the Festival Orchestra of Bielsko Biaa.
The Bank has provided funding for the Festival since 1996.
Concert of Christmas Carols at the National Philharmonic
For a few years the Bank has sponsored the concert of Christmas
carols performed by the Symphonic Orchestra and the Choir of the
National Philharmonic in Warsaw. It did so in December 2011 as well.
Every year the event enjoys extraordinary popularity, and one carol is
always sung by the audience together with the performers.
Theatrical Events
Cooperation with the Stary National Theatre in Krakw
In 2011, the Bank continued its support of the Helena Modrzejewska
Stary Theatre in Krakw, based on a three-year sponsorship agreement. Bank Pekao is the Primary Sponsor of the Theatre, which is the
second oldest theatrical establishment in Poland. The Stary Theatre
was promoted to the status of a national theatre in 1991. It holds
a special position in the history of Polish culture
15th Shakespearian Festival

The Shakespearian Festival is an international theatrical event held
every year in the Tricity (the Gdask-Sopot-Gdynia agglomeration). Its
history dates back to 1993. Since 2008, the Festival has been organised jointly by the Gdask Shakespearian Theatre and the Theatrum
Gedanense Foundation. The purpose of the Festival is to present and
popularise the works of William Shakespeare. The shows are staged
at nearly all theatres in the Tricity as well as in other venues, outside
theatres. The organisers make an effort to present the most interesting
performances from Poland and other countries. The Festival is in
a natural way developing into a platform for meeting and thought sharing for artists and people connected with culture from various parts of
the world. Bank Pekao has supported the Festival since 2000. In 2010,
it was honoured with the title of the Golden Sponsor of the Festival.
Cooperation with the Opera Foundation
In 2011, the Banks continued cooperation with the Opera Foundation
bore fruit in the form of the premiere of The Labor of Life, a play by
Hanoch Levin, an Israeli writer whose works attract large audiences all
over the world. The performance took place at the National Theatre in
Warsaw and was a major theatrical event of the season. The production, directed by Jan Englert, featured a cast including some of the
finest Polish actors, such as Anna Seniuk and Janusz Gajos.
Major Cultural Events
d International Ballet Festival
The Festival is the biggest and the most prestigious ballet event in
Poland.The guiding principle of the Festival is to promote the art of ballet and contemporary achievements in choreography, both the classical
forms and the contemporary trends. In 2011, the Festival was held for
the twenty first time.The Grand Theater in d has played host to the
best ballet companies in the world. One of the stars of the event was
La Scala Theatre Ballet of Milan.
The Beskids Culture Week
This is the oldest, largest and longest folkloristic event in Europe,
which is now firmly established in the calendar of international folklore
meetings held under the patronage of the International Council of
Organizations of Folklore Festivals and Folk Arts (CIOFF). In 2011, as
part of the 48th Beskids Culture Week concerts were held on five main
stages in Wisa, Szczyrk, ywiec, Makw Podhalaski and Owicim.
The Beskids Culture Week is not only a festival of folklore and folk art
but, first and foremost, a festival of dance, singing, music, fun and joy.
The event is an excellent opportunity to learn about Polish folk culture
and the diverse, often exotic cultures of other countries and nations.
The Sapiehas. Art Collectors and Patrons Exhibition at the Wawel
Royal Castle in Krakw
An exhibition presenting a collection of works of art gathered by the
Sapieha family, one of the most eminent families of former Rzeczpospolita. The exhibition was accompanied by a concert of 17th century
music in Vilnius organ tablature and a series of lectures and interactive
classes for adults and children. For years Bank Pekao S.A. has been
supporting the cultural initiatives of the Wawel Royal Castle in Krakw,
which is visited by over three million tourists annually.
Krakw Theatre Night
During this Festival of Theatres held in Krakw the public had an
opportunity to enjoy such extraordinary events as a singing lesson of
timeless operetta and musical songs, organised in the exotic scenery
of the Palm House in the Botanic Garden of the Jagiellonian University
in Krakw, a special jubilee performance by Boena Zawilak-Dolny
a famous soloist of the Krakw Opera, or an exhibition under the name
re-kreacje (re-creations) devoted to after-hours pastimes of theatre
artists (painting, sculpture, photography and works of applied art).
The event was also a unique opportunity to visit the nooks and crannies of the Krakw Opera building which are normally inaccessible to
the public.
Bank Pekao as Official Sponsor of the POLITYKA Passports

Ranking
POLITYKA Passports are amongst Polands most prestigious cultural
awards. Every year they are awarded to young artists of noteworthy talent.
The Bank has already sponsored four successive editions of the award.
POLITYKA Passports have been awarded since 1993 in six categories:
literature, film, theatre, classical music, visual arts and popular music.
The winners of the awards are currently the foremost Polish artists. In
addition, for eight years a special award of Laurels for the Creator of
Culture has been conferred on persons who have distinguished themselves with outstanding activity in the area of culture, its organisation and
promotion.
The winners of the awards are currently the foremost Polish artists.
Cultural Initiatives for the Employees

Cooperation with Museums
For many years now the Bank has cooperated with major Polish museums, including the Museum of Art in d and the National Museum
in Krakw.
New partners of the Bank include the Contemporary Art Centre in Warsaw
and the Contemporary Art Centre in Toru (People and the City exhibition comprising works of art from UniCredits collection).
During yet another edition of the UniCredit Art Day, in 2011 the Bank
cooperated with nine museums in eight cities (below is presented more
detailed information on cultural initiatives for the Banks employees).
The UniCredit Art Day project has originated in the UniCredit Group. In
Poland, it is an example of successful cooperation with the leading museums, with the participation of Bank Pekaos employees and their families.
In 2011, the annual UniCredit Art Day took place on November 19th and
involved nine museums in eight Polish cities. On that day the museums
opened their doors to the Banks employees and members of their families, offering lectures, exhibitions and classes devoted to art as well as
competitions for children. The exhibitions that attracted the most interest
were the ones in Warsaw (Contemporary Art Centre), d and Krakw.
Bank Pekao as Sponsor of the Polish PEN Club Awards

Bank Pekao engaged in cooperation with the Polish PEN Club in 2006.
The first awards sponsored by the Bank were handed in 2007. In addition
to the Jan Parandowski Awards for literary achievements the Bank sponsors awards for publishing houses and the most outstanding translators.
The UniCredit Art Day was held for the sixth time, and is now a fixed
feature in the corporate calendar. This initiative is a manifestation of Bank
Pekaos commitment to the promotion and support of art and culture as
a factor conducive to the development and integration of the communities
in which it operates. It is an example of effective cooperation between
business and art centres and an effort to motivate the employees to
explore art.
The Polish PEN Club is the Polish Centre of the international P.E.N.
organisation, established 85 years ago. Its objective is to develop cultural
exchange and guard the interests of Polish literature worldwide.
Social and Civic Initiatives
As part of its statutory activities, the Polish PEN Club bestows awards for
literary achievements (the Jan Parandowski Awards) and awards dedicated to publishing houses (Editorial Awards). Both awards are regarded
as very prestigious by the intellectual and opinion-forming circles, and are
widely commented by artists and the media.
On October 4th 2011, in Warsaw, Sawomir Mroek, one of the most
famous Polish and European writers received the annual Jan Parandowski
Award for his lifetime achievement. The Bank is the sole sponsor of the
award, which is considered as one of the most prestigious distinctions in
the literary circles.
Cooperation with the CASE Foundation

The Center for Social and Economic Research (CASE Foundation) was
established in 1991 as a private, non-commercial and independent
research institute focusing on the transition process, European integration
and global economy. The Foundations objective is to further knowledge
of economy and support research in the area.
The Foundation fulfils its goals, among other things, by:
research in economic sciences, economic and social policies, economic and institutional reforms, and European integration;
conferences and seminars;
grants and awards to individuals conducting research activities to
promote the knowledge of economy and society.
The Foundation has achieved a particular success in educating exceptionally talented economists. Since 2000, they have been given grants thanks
to the financial support of private sponsors.
The Bank has cooperated with the CASE Foundation since 1999 and
each year has donated funds to the Foundation for its statutory activity.
The Banks benefits from the cooperation with the CASE Foundation
include priority access to valuable data and independent macroeconomic
research and free participation of the Banks employees in conferences
and seminars organised by the Foundation.
Support of Sport
Pekao Szczecin Open Mens Tennis Tournament
The annual ATP International Mens Tennis Tournament in Szczecin, organised by the Promasters Foundation, is the most prominent event in the
West Pomerania region, in which the Bank has been involved as Titular
Sponsor and Main Sponsor since the tournament was first organised, that
is for 19 years.
The cooperation with the tournaments organiser is based on a long-term
agreement. Since 2009, when the City of Szczecin became involved in the
organisation of the event, the Bank has been the Official Co-Sponsor of all
the accompanying events. The Citys involvement has raised the events
profile, contributing to the promotion of the region in Poland and abroad.
As co-sponsor, Bank Pekao is strongly associated with the Tournament by
its customers, as well as local authorities and residents.
Factors that will Affect the Groups Performance
122
Directions of the Activities and Business Priorities

The Business Model and Competitive Advantages
Business Priorities
123
123
123
Factors that will Affect

the Groups Performance
Bank Pekao S.A. and its subsidiaries operate predominantly on the
territory of Poland. Therefore, the Banks performance will be influenced
mainly by the economic events in Poland and international developments
that have an impact on Polands economy.
Most probably, next quarters will bring aslowdown in the economic
growth, as the uptrend that prevailed on the labour market in 2011 is
expected to come to an end, which will weigh on the growth rate of
private consumption. The EURO 2012 Football Championship in mid 2012
should be afactor mitigating the cyclical downturn. Completion of the
EURO 2012-related investment projects and the positive impact of the
event itself should support the relatively good economic situation in the
first half of 2012. However, the second half of the year may be markedly
weaker in this respect.
Based on the results of surveys, private sector companies reduced
investment growth pace, and this trend is likely to continue into 2012.
Despite the rather optimistic prospects for the economy (approximately
3% year-on-year growth in 2012), the heightened economic uncertainty
will discourage new investment in production capacities, with companies
limiting their capital expenditure to the required replacement investments
in their machine parks.
Growth in private consumption may be negatively affected by the anticipated stagnation on the labour market. The employment growth rate in
the corporate sector is expected to fall to slightly above zero (from the
year-on-year growth rate of just above 2% at the beginning of 2012), with
pay rises slightly above the inflation rate, translating into little growth in
real terms. Consequently, amaterial increase in real salaries and wages
is unlikely, which in turn will depress real growth in retail sales.
A scenario assuming deceleration of the inflationary processes is supported by the leading indicators, which point to slowing global economic
growth over the next quarters. This would translate into alower demand
for commodities, and thus afall in their prices. Lower commodity prices
could drive areduction in the prices of goods in those industry sectors
where demand has clearly declined or an increase in margins (and consequently in the financial performance) of those sectors where demand is
holding up despite the economic slowdown. The main risk factor for the
lower inflation scenario is the uncertainty about crude oil prices, fuelled
by the fact that they continue at ahigh level and by the geopolitical tension surrounding Iran. However, given the global economic slowdown, it
is not probable that the Monetary Policy Council will continue with interest
rate increases even if the inflation rate remains high.
In the fourth quarter of 2011, the corporate deposits volume continued to
grow at ahigher pace. A similar trend was seen in households deposits.
However, keeping such ahigh growth rate may be impossible in 2012.
In the case of households, achange in the savings structure towards less

risky assets was asignificant factor in the growth of deposits in the second half of 2011. The scale of this process in 2012 may be much smaller
(or the trend may even reverse), which, coupled with the deteriorating
labour market conditions, may reduce the rate of growth of households
deposits as early as in the first quarter. The corporate deposits growth
rate may also slow down, since in the fourth quarter it was supported
by one-off events, such as placement at banks of large proceeds from
sale of financial assets. These funds will be probably gradually spent
or invested. What is more, companies operating in those sectors which
are more strongly affected by the economic slowdown will experience
atemporary drop in revenues.
The year-on-year growth rate for loans to households was 12% as at the
end of 2011. This robust figure was due in alarge part to the depreciation of the Polish currency and the resultant increase in the PLN-value
of the foreign-currency loans portfolio. Taking into account fundamental
factors (regulatory changes tightening the requirements concerning
borrowers incomes, changes in the governmental programme Family in
Their Own Home, and adowntrend in the housing market, which makes
potential buyers postpone the purchase decision) adecrease in demand
for household loans may be expected. In the case of corporate clients,
they may show less interest in loans as aresult of the probable decrease
in corporate investment spending due to uncertainties in the external
environment of Polands economy.
The introduction of anew banking levy, aimed at increasing safety buffers
of the banking system, has been discussed in Poland for several months.
The initial idea was that anew banking tax would be introduced.
However, in March 2012 the original concept was redefined, and now an
increase in the contribution to the Bank Guarantee Fund (BFG) is considered. Decisions on the exact size of the change as well as the timing of
its implementation are yet to be taken. The changes will most probably be
effective from 2013 onwards.
Due to the regulators and merchants pressure, the Polish market of
non-cash transactions needs to adopt an interchange fee reduction
programme. If the market accepts the NBPs proposal of agradual interchange fee reduction, its level would reach the EU average in 2017.
The government-announced measures aimed at consolidating public finance have been well received by the financial markets and as long as they
are followed, the perception of Poland in the financial markets will be positive. Although the steps taken to date focused mainly on increasing public
levies (rather than cutting down spending), and the reform programme
should be broadened to include structural reforms reinforcing the competitiveness of Polands economy (such as deregulation, or simplification of tax
laws), any actions designed to reduce the deficit clearly contribute to clearing up the situation in the FX market, bond market and to some extent also
the stock market. As forecast by the government, the undertaken actions
should lead to the public deficit reduction to some 3% of GDP in 2012, and
should bring the first decline in the debt to GDP ratio in many years.
As regards the international environment, the leading indicators suggest

that economies have already entered the phase of economic slowdown.
Most probably, this will also mean aslower growth rate in the Polish
economy in the next few quarters. The most significant source of uncertainty is the excessive indebtedness of some members of the euro zone.
This is reflected in the financial market situation (considerable fluctuations of exchange rates) and may affect the real economy and banking
activity. A factor that will benefit Poland over the next few quarters is the
strong trade relations with the German economy, which is growing at
arelatively high rate in comparison with other euro zone members and
boasts better leading indicators readings.
/international, other). Clients are served by Relationship Managers,

which makes it possible to optimise the level and cost of service. The Relationship Managers concentrate on providing high quality and efficient
service, using best practices and integrated sales management tools.
The Bank offers products and services which are competitive on the
Polish market, top service quality, awide network of branches and ATMs
easily available across Poland, aprofessional call-centre and acompetitive Internet and mobile banking platform for individual and corporate
clients as well as small and medium-sized companies.
Directions of the Activities

and Business Priorities
The scale of operations, robust capital and liquidity structure, strong

balance sheet with ahigh capital adequacy ratio and asignificant excess
of deposits over loans granted, give us an edge to successfully compete
on the market.
Bank Pekao S.A. plans to concentrate its activities on the Polish market.
Business Priorities
In 2011, the Bank strengthened its competitive advantages, including in

particular the solid capital and liquidity, which gained in significance given
the tension in the European banking system. Once again the resilience
and stability of the Banks business model were confirmed, which warrants expectation of further strengthening of our position as the best bank
in Poland in terms of profitability, sustainability of profits, operational
efficiency and effective risk management as well as the Banks reputation
and satisfaction of clients and employees.
Given the positive outlook for Polands economy, the Bank will be able to
concentrate on the further growth of business while maintaining high risk
management standards.
Despite the expected slowdown in the GDP growth rate in 2012, the
situation of the Polish economy still gives grounds for some degree of
optimism as regards further planning of expansion of the scale of business. In the environment described above, the Bank intends to develop
its commercial activities focused on the most crucial business areas,
strengthen the multi-channel distribution of products and services,
increase brand awareness, reinforce Pekaos leading position, continue
client and employee satisfaction improvement programmes, and pursue
projects designed to further optimise the risk management process to
achieve higher commercial efficiency.
The Bank will seek to maintain astrong balance-sheet structure by

increasing the volume of deposits. At the same time, we will offer our
clients the possibility of investing via mutual funds.
The Business Model and Competitive Advantages

The Bank will continue commercial activities on the financial services
market basing on the client segmentation model.
The individual clients segment was split into the retail, affluent clients
and private banking sub-segments. Each of the sub-segments has
adedicated business model, with adefined service level and an appropriate product offering. For instance, affluent and private banking
clients are provided with the services of account managers.
SME clients are provided with professional products and services offered by account managers dedicated to this customer segment.
The corporate clients segment was divided into medium-sized and
large companies. The segmentation is based on clients turnover,
sector of the economy, type of ownership (public/private, domestic
The priorities in the area of commercial activities will be to continue the

sale of mortgage loans in the Polish zoty, consumer loans for individual
clients, and loans to the SME segment, as well as to increase financing of
medium-sized enterprises and infrastructure projects.
A number of initiatives have been planned to support business growth in

selected segments. They will include intensifying marketing actions as
well as aselective development of the distribution network in the regions
where the Banks market penetration is lower.
Individual Clients
The Bank is working towards achieving the position of leader on the consumer finance market by adapting our offering efficiently and effectively
to meet the clients needs, and towards becoming the bank of choice in
the consumer loans segment, while adhering to the principles of ethics in
lending and reasonable risk levels.
The Bank also intends to improve its position on the market of mortgage
loans in the Polish zoty. To this end we will leverage many years experience gained by specialising in this product. In the area of savings products we will continue to offer attractive deposit products, which should
allow continuing sustainable growth of the balance sheet. Individual
clients will also be offered mutual funds.
The pursuit of the above objectives will be assisted by aselective development of the distribution network in the regions where Pekaos market
Prospects for Development (cont.)
penetration is lower, leveraging the innovative changes introduced in the

electronic distribution channels, including mobile banking, and anew service model for affluent clients. The Bank also intends to continue intensive
marketing campaigns and promotional offers, including those connected
with the sponsorship of EURO 2012.
Private Banking
The Bank will further develop the products and services portfolio and
tools dedicated to the private banking clients. We will continue activities
aiming at expansion of our product offering and continuous improvement of service quality, also through continued training and raising the
qualifications of our advisers.
Corporate and Business Clients
Bank Pekao S.A. is committed to strengthening its leading position in
the corporate banking, corporate finance and transactional banking segments. It is also the Banks goal to achieve the leading position in major
infrastructure projects, including in the public sector.
With aview to ensuring top quality service to corporate and business
clients (medium-sized and large corporations, as well as small and micro
enterprises), the Bank will continue to develop its offering, maintain its
comprehensive nature, and provide modern banking products to meet
even the most demanding requirements of the clients.
The Bank intends to concentrate on offering safe products and innovative
solutions, providing expertise and advisory services to corporate clients,
going beyond the scope of the basic banking activities.
It is the Banks objective to reinforce Pekaos position of abank enjoying
the highest recognition among corporate clients in Poland for its expertise
and capabilities, customer satisfaction, and creation of value.
The activities of the Bank Pekao S.A. Group on the financial services
market will be guided by afocus on the delivery of value for customers
and increasing their satisfaction with services by meeting their needs as
closely as possible, continuous improvement of the service quality, and
offering customers simple and comprehensible solutions, which will prove
reliable and effective in helping them attain their financial goals.
Statement of Bank Polska Kasa Opieki Spka Akcyjna on

Application of Corporate Governance Standards in 2011

Application of Corporate Governance Standards in 2011
Statement of Bank Polska Kasa Opieki
Spka Akcyjna on Application of Corporate
Governance Standards in 2011
In accordance with the Minister of Finances Regulation on current and
periodic information published by issuers of securities and the conditions
for recognition as equivalent of information required under the laws of
anon-member state, dated February 19th 20091, and pursuant to Par. 29.5
of the Rules of the Warsaw Stock Exchange (WSE), in conjunction with the
WSE Management Boards Resolution No. 1013/2007 on the scope and
structure of statements of compliance with corporate governance rules by
listed companies, dated December 11th 2007, Bank Polska Kasa Opieki
Spka Akcyjna (the Bank) hereby states that it is governed by the sets of
corporate governance standards specified below, which include corporate
governance standards adopted voluntarily by the Bank and corporate governance practices that go beyond the requirements defined in national law.2
The general corporate governance rules applied by the Bank, i.e. the
system of regulations and procedures defining guidelines for the activities
of the Banks governing bodies, including their relations with entities
interested in the Banks activities (stakeholders), result from statutory
laws, including in particular the Commercial Companies Code and the
Banking Law, capital market regulations, as well as the rules laid down in
the Code of Best Practice of the Polish Bank Association and the Code of
Best Practice for WSE Listed Companies.
The Bank applies corporate governance rules laid down in the Code of
Best Banking Practice of the Polish Bank Association.3
1) Description of key features of the Banks internal control and

risk management systems related to the preparation of financial
statements and consolidated financial statements6
The Banks Management Board is responsible for designing, implementing and functioning of the internal control system and risk management
system with respect to the preparation of financial statements.
The Supervisory Board oversees the functioning of the internal control
system by assessing its adequacy and effectiveness through the Audit
Committee and the Internal Audit Department.
The internal control system is aimed at ensuring reliable, complete and
correct disclosure in financial statements of all commercial transactions
executed over agiven period.
The accounting policies adopted by the Bank, which are compliant
with the International Financial Reporting Standards (IFRS), the chart
of accounts and reporting databases, take into account the format
and the extent of detail of the financial data disclosed in financial
statements, in accordance with the requirements and rules applied
by the parent company. The Bank maintains its accounting books in
the form of separate IT resources in its IT systems, in line with the
adopted business structure. The IT systems ensure access to intelligible and centralised data, separately for each system, which confirm
the accounting records and make it possible to control the consistency of records, to carry forward account activity and balances, and
to draw up financial statements.
The accounting books are reconciled against reporting databases.
The Bank applies corporate governance rules laid down in the Code of
Best Practice for WSE Listed Companies4 set by WSE Supervisory Boards
Resolution No. 17/1249/2010 of May 19th 2010.
Furthermore, the Bank applies corporate governance rules resulting from
the UniCredit Group Integrity Charter5, which go beyond the requirements
under national law.
The activities undertaken by the Bank comply with generally applicable
laws, the Banks Statute, the Banks internal regulations, supervisory and
control authorities recommendations, good practices and ethical norms.
Acting in compliance with Par. 91.5.4.ck of the above-mentioned Minister of Finances Regulation of February 19th 2009, the Bank presents the
following information:
The responsibility for the preparation of financial statements and periodic

financial reports and for the provision of management information rests
with the Financial Division, supervised by the Vice President of the Banks
Management Board.
UniCredit S.p.A., as the parent company of the Bank, is subject to the
provisions of Italian Saving Act 262 (law 262/2005 and Legislative Decree
303/2006), modelled on the provisions of the American Sarbanes-Oxley
Act. Therefore, the Bank has implemented aprocess for verification of its
operational and audit procedures applied in the drawing up of financial
statements in accordance with UniCredit S.p.A.s guidelines arising from
the above provisions.
Journal of Laws of 2009,No.33, item 259, as amended.

Par. 91.5.4.a of the Minister of Finances Regulation of February 19th 2009.
3
The document is publicly available on the Polish Bank Associations website: http://www.zbp.pl/prawo_bankowe.
4
The document is publicly available on the WSEs website: http://www.corp-gov.gpw.pl/lad_corp.asp.
5
The document is publicly available on the Bank Pekao S.A.s website: http://www.pekao.com.pl/o_banku/misja/#tab2.
6
Par. 91.5.4.c of the Minister of Finances Regulation of February 19th 2009.
1
2
2) Identification of shareholders that own directly or indirectly

major holdings of shares in the Bank, including information
on the number of shares held, percentage of the share capital
held, the number of votes attached to the shares held and their
percentage share in the total vote at the Banks General Meeting
of Shareholders7
Since August 1999, the Banks principal shareholder has been UniCredit
S.p.A. As at December 31st 2010, UniCredit S.p.A. held 59.24% of the
Banks share capital and the same percentage of the total vote at its
General Meeting of Shareholders. The remaining shareholders interests
amounted to 40.76%.
Shareholders of the Bank holding directly or indirectly, through their subsidiaries, at least 5% of the total number of voting rights at the Banks General
Meeting of Shareholders are as follows:
NUMBER OF SHARES
AND VOTES AT GENERAL
MEETING
SHAREHOLDER
UniCredit S.p.A.
Other shareholders
Total
% OF SHARE CAPITAL AND

TOTAL VOTE AT GENERAL
MEETING
DECEMBER 31ST 2011
155 433 755

106 948 374
262 382 129
On January 11th 2012, Aberdeen Asset Management PLC of Aberdeen

(acting for and on behalf of itself and its subsidiaries) acquired
215,000 shares of the Bank and exceeded 5% of the total number of
voting rights at the General Meeting of Shareholders, as reported by
the Bank in the current report released on January 17th 2012 (current
report No. 3/2012). Currently, the investor holds 13,194,683 shares of
the Bank, representing the same number of voting rights and accounting for 5.03% of all outstanding shares of the Bank and acorresponding
percentage of the total vote.
3) Identification of holders of any securities with special control
rights with adescription of those rights8
According to the Banks Statute, all existing shares in the Bank are
ordinary bearer shares. There are no special preferences or limitations connected with the shares, or differences in the rights attached
to them. The rights and obligations related to the shares are defined
by the provisions of the Polish Commercial Companies Code and other
applicable laws.
Securities issued by the Bank do not give their holders any special control
rights.
4) Identification of any restrictions on the exercise of voting rights,
such as restriction on the exercise of voting rights by holders
of agiven number or percentage of votes, temporal restrictions
on voting, or provisions according to which, with cooperation
NUMBER OF SHARES
AND VOTES AT
GENERAL MEETING
% OF SHARE CAPITAL AND

TOTAL VOTES AT GENERAL
MEETING
DECEMBER 31ST 2010
59,24%
40,76%
100,00%
155 433 755

106 930 571
262 364 326
59,24%
40,76%
100,00%
of the Bank, equity-related rights resulting from securities are

separated from the fact of holding those securities9
According to the Banks Statute there are no restrictions on voting rights.
5) Identification of any restrictions on transferability of ownership of
securities issued by the Bank10
According to the Banks Statute, there are no restrictions on transferability
of ownership of the Bank shares.
6) Description of rules governing appointment and removal of
members of managerial bodies and their rights, in particular the
right to decide whether to issue or repurchase shares11
Management Board
As stated in the Banks Statute, the Management Board is composed of
5 to 9 members. Members of the Management Board are appointed by
the Supervisory Board for ajoint three-year term of office. The Management Board comprises the President of the Management Board, Vice
Presidents of the Management Board, including the First Vice President
of the Management Board, and members of the Management Board. Vice
Presidents and members of the Management Board are appointed and
removed upon the request of the President. Appointment of two members
of the Management Board, including the President, is subject to approval
by the Polish Financial Supervision Authority. The body which applies to
for the approval is the Supervisory Board.
Par. 91.5.4.d of the Minister of Finances Regulation of February 19th 2009.

Par. 91.5.4.e of the Minister of Finances Regulation of February 19th 2009.
9
Par. 91.5.4.f of the Minister of Finances Regulation of February 19th 2009.
10
Par. 91.5.4.g of the Minister of Finances Regulation of February 19th 2009.
11
Par. 91.5.4.h of the Minister of Finances Regulation of February 19th 2009.
7
8

Application of Corporate Governance Standards in 2011 (cont.)
At least half of the members of the Management Board, including its
President, should possess athorough knowledge of the Polish banking
market, i.e. they should meet all of the following criteria:
they have professional experience gained on the Polish market, relevant for the performance of their managerial function at the Bank,
they are permanently domiciled in Poland,
Each member of the Banks Management Board is obliged to act in such
away as to further the Banks interests. According to the Code of Professional Ethics effective at the Bank, each member of the Management Board
is expected to be honest and loyal in pursuing the common objectives, and
to respect the Banks resources and use them in aprudent manner. Moreover, members of the Management Board are prohibited from taking any
decisions or actions that would lead to conflicts of interests or that would be
incompatible with the Banks interests or their official duties. A Management Board member is obliged to notify the Banks Management Board
and Supervisory Board of any situation in which aconflict of interests might
occur or has occurred as well as refrain from participating in the discussion
and voting on aresolution in the case of which aconflict of interests has
occurred. A Management Board member who becomes aware of any situation where an employee or arepresentative of abusiness partner of the
Bank demanded any benefits, regardless of their scope and nature, should
promptly notify the Supervisory Board of such demand.
Members of the Management Board have rights under the generally
applicable laws. According to the Banks Statute, they have no right to
decide whether to issue or purchase shares.
7) Description of rules governing amendments to the Banks
Statute12
Any amendment to the Banks Statute requires adoption by way of
aresolution of the Banks General Meeting of Shareholders as well as
registration of the amendment with the National Court Register. The Rules
of Procedure for the General Meeting of Shareholders of the Bank13 define
detailed rules of conducting the General Meetings and adopting resolutions. Resolutions of the General Meeting concerning amendments to the
Banks Statute are adopted by the three-quarters majority, with the proviso that according to the Banks Statutes the Banks General Meeting is
authorised to adopt resolutions only if at least 50% of the shares plus one
share are represented. Moreover, as stated in Par. 34.2 of the Banking
Law, any amendment to the Banks Statute requires authorisation by the
Polish Financial Supervision Authority where such amendment relates to:
the Banks name;
the Banks registered office, business profile and scope of activity,
taking into consideration activities defined in Par. 69.2.1-7 of the Act
on Trading in Financial Instruments of July 29th 2005, which the Bank

intends to perform according to Par. 70.2 of this Act;
the governing bodies and their scopes of competence, including in
particular the competences of the Management Board members appointed upon approval by the Polish Financial Supervision Authority,
and decision-making rules;
the principles of functioning of the internal control system;
the Banks own funds and financial management principles; and
voting preference or limitation attached to the Bank shares.
8) Operation of the General Meeting of Shareholders and its key
powers; description of shareholder rights and the manner of exercising these rights, including in particular rules resulting from
the Rules of Procedure for the General Meeting of Shareholders,
unless this information does not follow directly from generally
applicable laws14
The operation of the Banks General Meeting of Shareholders is governed
by the Rules of Procedure for the General Meeting of Shareholders of
the Bank, adopted by way of Resolution No. 19 of April 8th 2003, as
amended by way of Resolution No. 41 of May 5th 2009, which defines
detailed rules of conducting General Meetings of Shareholders and adopting resolutions. The Rules of Procedure are available to the public at the
Banks website15.
Apart from the powers and authorities mentioned in the Commercial
Companies Code and the Banks Statute, the Banks General Meeting of
Shareholders has the following powers and authority:
to review and approve the report on the activities of the Bank and the
Banks financial statements for the previous financial year;
to adopt aresolution on profit distribution or coverage of loss;
to review and approve the report on the activities of the Supervisory
Board;
to grant discharge to members of the Supervisory Board and Management Board in respect of their duties;
to review and approve the report on the activities of the Bank Pekao
S.A. Group and the Groups financial statements;
to set the dividend record date and dividend payment date;
to dispose of or lease abusiness or its organised part, or to encumber
it with limited property rights;
to amend the Banks Statute and to draft its consolidated text;
to increase or decrease the Banks share capital;
to issue convertible bonds, bonds with pre-emptive rights to acquire
shares, or subscription warrants;
to retire shares and to define the terms of retirement;
to decide on the Banks merger, demerger or liquidation;
to create and release special accounts;
to appoint and remove from office members of the Supervisory Board;
Par. 91.5.4.i of the Minister of Finances Regulation of February 19th 2009.

Adopted by virtue of Resolution No. 19 of the General Meeting of Shareholders dated April 8th 2003.
14
Par. 91.5.4.j of the Minister of Finances Regulation of February 19th 2009.
15
http://www.pekao.com.pl/informacje_dla_inwestorow/walne-zgromadzenia-banku/
12
13
to define the remuneration rules for members of the Supervisory

Board;
to conclude an agreement with asubsidiary which provides for the
management of the subsidiary or for the transfer of profit by the
subsidiary;
to appoint an external auditor;
to decide upon other matters falling within the scope of the Banks
activities, which have been submitted to the Banks General Meeting of
Shareholders for discussion.
The Banks General Meeting of Shareholders is convened via the Banks
website and in the manner prescribed for disclosure of current information
in accordance with the regulations on public offerings, conditions governing
the introduction of financial instruments to organised trading, and public
companies. The notice convening the General Meeting must be published at
least twenty-six days before the scheduled date of the Meeting.
An Ordinary General Meeting of Shareholders should take place once
ayear, not later than in June. When determining the date of the General
Meeting of Shareholders, the Management Board seeks to enable as
many shareholders as possible to participate in the Meeting.
The Banks Supervisory Board may convene an Ordinary General Meeting
of Shareholders if the Management Board does not convene it by the
due date stated in the Statute, and an Extraordinary General Meeting of
Shareholders, if necessary.
The full documentation which is to be presented to the General Meeting,
together with draft resolutions and information concerning the General
Meeting, is made available to persons entitled to participate in the
General Meeting on the Banks website and at the Banks Head Office in
Warsaw, at ul. wirki i Wigury 31. Information in this respect is included in
the notice convening the General Meeting, in accordance with Art. 402 of
the Commercial Companies Code.
Official copies of the Management Boards report on the activities of the
Bank and the financial statements as well as copies of the Supervisory
Boards report and auditors opinion are delivered to shareholders upon
request no later than 15 days prior to the General Meeting.
The rights of the Banks shareholders include in particular:
the right of shareholders holding at least ahalf of the share capital
or at last ahalf of the total vote to convene an Extraordinary General
Meeting of Shareholders. In this case, the shareholders elect the chairman of the General Meeting;
the right of shareholders holding at least one-twentieth of the share
capital to demand that specific issues be placed on the agenda of the
next General Meeting. The demand should include the justification
and the draft resolution concerning the proposed issue, and should be
submitted to the Management Board no later than 21 days prior to the
scheduled date of the Meeting. The Management Board is obliged to
announce changes in the Meeting agenda introduced upon sharehold-
ers demand promptly and in no event later than 18 days prior to the
scheduled date of the Meeting. The announcement is made in the
manner prescribed for convening the General Meeting;
the right of shareholders holding at least one-twentieth of the share
capital to submit to the Bank before the date of the General Meeting,
in writing or via electronic communication media draft resolutions
concerning issues which have been or are to be placed on the General
Meetings agenda. The Bank promptly announces the draft resolutions
on its website;
the right of every shareholder to submit, during the General Meeting, draft
resolutions concerning issues placed on the General Meetings agenda;
the right of shareholders to participate in the Banks General Meeting
personally or by proxy;
the right of shareholders holding one-tenth of the share capital represented at the General Meeting to demand that the attendance list be
checked by acommittee appointed for that purpose and composed of
at least three persons, including one person appointed by the parties
making the demand;
the right according to which the Banks General Meeting of Shareholders is not allowed to adopt aresolution to remove an item from the
agenda or not to consider an issue which was placed on the agenda
upon request of shareholders unless the shareholders express their
consent to the same;
the right according to which the General Meeting may not be adjourned deliberately to obstruct the exercise of the shareholders rights;
the right of each participant of the General Meeting to nominate one or
more candidates for members of the Banks Supervisory Board;
the right of shareholders holding at least one-fifth of the share capital
to demand block voting on the appointment of the Supervisory Board;
arelevant request should be submitted to the Management Board in
writing at such time as to enable its placement on the agenda of the
General Meeting;
the right to inspect the book of minutes and to receive copies of resolutions authenticated by the Management Board;
the right according to which the Chairperson of the General Meeting
is obliged to ensure that the rights and interests of all shareholders,
including in particular minority shareholders, are respected;
the right of shareholders who raise an objection against aresolution to
justify the objection in aconcise manner.
All issues submitted to the General Meeting of Shareholders should have the
recommendation of the Supervisory Board. According to Par. 9 of the Banks
Statute, the Management Board is obliged to present all issues to be submitted to the General Meeting for consideration by the Supervisory Board.
The Banks General Meetings of Shareholders should be attended by members of the Supervisory Board and Management Board whose presence
is necessary to ensure proper answer to questions asked during the
Meeting. The auditor should be present at aGeneral Meeting of Shareholders which is to discuss financial matters of the Bank, and in particular
an Ordinary General Meeting of Shareholders.

The Banks Management Board, as the body responsible for ensuring legal assistance to the General Meeting of Shareholders, makes every effort
to ensure that the wording of resolutions is clear and unambiguous.
The Rules of Procedure for the General Meeting of Shareholders contain
provisions (Par. 13.10-17) regarding block voting on the appointment of
Any amendments to the Rules of Procedure for the General Meeting of
Shareholders take effect as of the date of the next General Meeting.
In the course of performing their responsibilities, the Banks governing
bodies ensure that the interests of the majority shareholder are served in
such away as not to prejudice the interests of the minority shareholders.
This is ensured in particular by the proper composition of the Supervisory
Board, which should comprise representatives of both majority and minority shareholders. Thus, the interests of all shareholder groups are taken
into account when carrying out the supervisory function. The principle of
the majority rule is reflected in Par. 10.2 of the Banks Statute, whereby
the Banks General Meeting of Shareholders may adopt resolutions if
at least 50% of the share capital plus one share is represented at the
Meeting. The purpose of this provision is to guarantee that resolutions
on matters most important to the Bank and its shareholders are adopted
by the General Meeting in the presence of shareholders representing
jointly an absolute majority of the share capital. However, if aresolution is
not adopted for lack of quorum, as defined above, it may be adopted at
the next Meeting with the same agenda in the presence of shareholders
representing at least 20% of the share capital.
The Chairperson of the General Meeting of Shareholders is responsible
for the orderly conduct of the Meeting and ensures that the rights and
interests of all shareholders are respected, that any abuse of rights by the
participants is prevented, and that the rights of minority shareholders are
observed.
Within the scope of their competence and to the extent necessary to
resolve issues placed under discussion of the General Meeting, members
of the Supervisory Board, members of the Management Board and the
auditor provide the participants with the required explanations and information concerning the Bank.
Voting on procedural matters may be carried out only on issues related
to the conduct of the Meeting. This voting procedure cannot be applied
to resolutions which may have an impact on the exercise of shareholder
rights.
Removing an item from the agenda or adecision not to consider an issue
placed on the agenda at the request of shareholders requires aresolution of
the General Meeting adopted with the three-quarters majority of votes, following approval by all the present shareholders who submitted such arequest.
16
17
Par. 91.5.4.k of the Minister of Finances Regulation of February 19th 2009.

http://www.pekao.com.pl/o_banku/wladze_Banku/
9) Composition of the Banks managerial, supervisory or administrative bodies and their committees, changes in their composition that occurred during last financial year, and rules of
procedure16
Management Board
As at January 1st 2011, the Banks Management Board was composed
of the following persons:
Alicja Kornasiewicz President of the Management Board,
Luigi Lovaglio First Vice President of the Management Board and
General Manager,
Diego Biondo Vice President of the Management Board,
Marco Iannaccone Vice President of the Management Board,
Andrzej Kopyrski Vice President of the Management Board,
Grzegorz Piwowar Vice President of the Management Board,
Marian Wayski Vice President of the Management Board.
On April 14th 2011, Mrs. Alicja Kornasiewicz resigned from her post of
President of the Management Board with effect from April 30th 2011.
With effect from May 1st 2011, Mr. Luigi Lovaglio was appointed
President of the Banks Management Board and CEO for the current
joint term of office of the Management Board. Mr. Luigi Lovaglio acted
as President of the Banks Management Board from May 1st 2011 to
July 19th 2011. Pursuant to Art. 22b.1 of the Banking Law, on July
19th 2011 the Polish Financial Supervision Authority unanimously approved the appointment of Mr. Luigi Lovaglio as President of the Banks
Management Board.
As at December 31st 2011, the Banks Management Board was composed of the following persons:
Luigi Lovaglio President of the Management Board,
Diego Biondo Vice President of the Management Board,
Marco Iannaccone Vice President of the Management Board,
Andrzej Kopyrski Vice President of the Management Board,
Grzegorz Piwowar Vice President of the Management Board,
Marian Wayski Vice President of the Management Board.
The Management Board acts on the basis of the Rules of Procedure
adopted by virtue of its Resolution No. 101/VI/03 of June 3rd 2003. The
Rules of Procedure define in particular the matters which require joint
consideration by the Management Board, as well as the procedure for
adopting aresolution in writing. The Rules of Procedure for the Management Board are available on the Banks website. Members of the
Management Board coordinate and supervise the activity of the Bank in
accordance with the applicable division of authority.
According to the Banks Statute, the Management Board conducts
the Banks affairs and represents the Bank. The Management Boards
powers and responsibilities include all matters which, pursuant to the
provisions of law or the Banks Statute, do not fall within the scope
of competence of other governing bodies To the extent permitted by
applicable Polish laws, the Management Board submits all required
information and data to UniCredit S.p.A. as the parent company. The
Management Board, operating through the statutory bodies of the
Banks subsidiaries, coordinates and directs their activities in order to
ensure stability of the Group.
On April 30th 2011, Mr. Federico Ghizzoni, Deputy Chairman and Secretary of the Supervisory Board resigned from his posts.
Pursuant to the provisions of the Rules of Procedure, the Banks Management Board prepares the development strategy for the Bank and
is responsible for its implementation and execution. The Supervisory
Board issues its opinions on the Banks long-term development plans
and annual financial plans, prepared by the Management Board. The
Management Board ensures that the management system at the Bank
is transparent and effective, and runs the Banks affairs in compliance
with applicable laws and best practices. The core values underlying the
management of the Bank are professionalism, credibility and confidentiality, while customer relations are underpinned by reliability and integrity,
as well as compliance with applicable laws, including regulations governing the prevention of money laundering and financing of terrorism. These
values are among the principles incorporated in the Code of Professional
Ethics effective at the Bank.
At ameeting held on June 1st 2011, the Supervisory Board appointed

Mrs. Alicja Kornasiewicz as Chairwoman of the Supervisory Board,
Mr. Jerzy Wonicki (who resigned from the position of Chairman of
the Supervisory Board) as Deputy Chairman of the Supervisory Board,
and Mr. Alessandro Decio as Secretary of the Supervisory Board.
Pursuing the principle of efficient and prudent management, the Management Board is responsible for initiation and implementation of programmes aimed at increasing the Banks value and rate of return for the
shareholders, as well as protection of the employees long-term interests.
In its decisions, the Banks Management Board makes every effort to
ensure, to the maximum extent possible, the promotion of the interests
of the shareholders, creditors, employees, as well as other entities and
persons cooperating with the Bank in its business activity.
Supervisory Board
As at January 1st 2011, the Banks Supervisory Board was composed of
the following persons:
Jerzy Wonicki Chairman of the Supervisory Board,
Federico Ghizzoni Deputy Chairman and Secretary of the Supervisory
Board,
Roberto Nicastro Deputy Chairman of the Supervisory Board,
Pawe Dangel Member of the Supervisory Board,
Sergio Ermotti Member of the Supervisory Board,
Oliver Greene Member of the Supervisory Board,
Enrico Pavoni Member of the Supervisory Board,
Leszek Pawowicz Member of the Supervisory Board,
Krzysztof Pawowski Member of the Supervisory Board.
On February 23rd 2011, Mr. Sergio Ermotti, member of the Supervisory
Board, resigned from his post.
18
The Ordinary General Meeting of Shareholders held on April 19th 2011

appointed Mrs. Alicja Kornasiewicz and Mr. Alessandro Decio to the
Supervisory Board, with effect from May 1st 2011 and April 19th 2011
respectively.
As at December 31st 2011, the Banks Supervisory Board was composed

of the following persons:
Alicja Kornasiewicz Chairwoman of the Supervisory Board,
Roberto Nicastro Deputy Chairman of the Supervisory Board,
Jerzy Wonicki Deputy Chairman of the Supervisory Board,
Alessandro Decio Secretary of the Supervisory Board,
Pawe Dangel Member of the Supervisory Board,
Oliver Greene Member of the Supervisory Board,
Enrico Pavoni Member of the Supervisory Board,
Leszek Pawowicz Member of the Supervisory Board,
Krzysztof Pawowski Member of the Supervisory Board.
The Supervisory Board acts on the basis of the Rules of Procedure
adopted by virtue of its Resolution No. 17/03 of May 22nd 2003, as
amended by way of Resolution No. 20/05 of June 27th 2005. The Rules
of Procedure for the Supervisory Board are available on the Banks
website.18
The role of the Supervisory Board is to exercise ageneral and permanent
supervision over the Banks activities, taking into consideration the Banks
function of the parent company for its subsidiaries. The Supervisory
Boards powers and responsibilities, other than those defined in law, are
set forth in the Banks Statute. In particular, the Supervisory Board examines all matters that are to be submitted to the Banks General Meeting of
Shareholders.
The Supervisory Board members always act with due regard to the
Banks interests and take all actions necessary to ensure efficient functioning of the Supervisory Board. Moreover, members of the Supervisory
Board are prohibited from taking any decisions or actions that would
lead to conflicts of interests or that would be incompatible with the
Banks interests. A Supervisory Board member is obliged to notify the
Banks Supervisory Board of any situation in which aconflict of interests might occur or has occurred as well as refrain from participating in
http://www.pekao.com.pl/o_banku/wladze_Banku/#tab2

the discussion and voting on aresolution in the case of which aconflict
of interests has occurred.
Each year, according to the regulations in force, the Supervisory Board
prepares and submits to the Banks General Meeting of Shareholders
an assessment of the Management Boards reports on the activities
of the Bank and of the Group for the last financial year, assessment
of the financial statements of the Bank and the consolidated financial
statements of the Bank Pekao S.A. Group for the last financial year,
assessment of the Management Boards recommendation concerning
distribution of profit or coverage of loss, as well as the report on the
activities of the Supervisory Board. The assessments prepared by the
Supervisory Board are made available to the shareholders before the
General Meeting of Shareholders.
The Supervisory Board set up dedicated committees which deal with
specific areas of the Banks operations, including the Audit Committee,
the Remuneration Committee and the Finance Committee. Reports of
the committees set up by the Supervisory Board are stored at the Banks
Head Office and made available by the Presidents Office to the shareholders upon request. Annual reports of the committees are attached as
appendices to the Supervisory Boards report and published in the same
manner as the report.
Audit Committee
As at January 1st 2011, the Audit Committee was composed of the following persons:
Oliver Greene Chairman of the Committee,
Frederico Ghizzoni Member of the Committee (until April 30th 2011),
Roberto Nicastro Member of the Committee (until June 1st 2011),
Leszek Pawowicz Member of the Committee,
Jerzy Wonicki Member of the Committee.
On June 1st 2011, the Supervisory Board appointed Mrs. Alicja Kornasiewicz and Mr. Alessandro Decio to the Audit Committee.
From June 1st 2011, the Audit Committee was composed of the following
persons:
Oliver Greene Chairman of the Committee,
Alessandro Decio Member of the Committee,
Alicja Kornasiewicz Member of the Committee,
Leszek Pawowicz Member of the Committee,
Jerzy Wonicki Member of the Committee.
The composition of the Audit Committee did not change as at December
31st 2011.
The scope of the Audit Committees remit has been determined by the
Supervisory Boards Resolution No. 42/07 of October 2nd 2007.
The Audit Committee supports the Supervisory Board in the performance
of its duties related to the adequacy and effectiveness of the Banks
internal control mechanisms, including identification, measurement and

management of risks, compliance with applicable laws and procedures
governing the Banks operations, correct application of accounting
principles in the process of drawing up financial statements, and ensuring
independence of external auditors and the resources of the Internal Audit
Department.
The Audit Committee is composed of five persons selected from among
members of the Supervisory Board, and includes at least three independent members. The Chairman of the Audit Committee is an independent
member of the Supervisory Board.
Meetings of the Audit Committee are held as need arises, but not less
frequently than four times ayear, and dates of these meetings coincide
with key dates in the Banks reporting cycle and the review of the annual
audit plan presented by the Director of the Internal Audit Department.
Remuneration Committee
As at January 1st 2011, the Remuneration Committee was composed of
the following persons:
Sergio Ermotti until February 23rd 2011,
Federico Ghizzoni until April 30th 2011,
Enrico Pavoni,
Jerzy Wonicki.
On June 1st 2011, the Supervisory Board appointed Mrs. Alicja
Kornasiewicz and Mr. Roberto Nicastro to the Remuneration Committee.
From June 1st 2011, the Remuneration Committee was composed of the
following persons:
Alicja Kornasiewicz,
Roberto Nicastro,
Enrico Pavoni,
Jerzy Wonicki.
The composition of the Remuneration Committee did not change as at
December 31st 2011.
The Remuneration Committee operates on the basis of the Supervisory
Boards resolution. The Remuneration Committee makes recommendations to the Supervisory Board regarding: the amount of remuneration to
be paid to members of the Management Board, the remuneration policy
for the Banks managerial staff, submission of recommendations to the
Banks General Meeting of Shareholders regarding the amount of remuneration to be paid to members of the Supervisory Board.
Finance Committee
As at January 1st 2011, the Finance Committee was composed of the
following persons:
Federico Ghizzoni until April 30th 2011,
Enrico Pavoni,
Sergio Ermotti until February 23rd 2011.
On June 1st 2011, the Supervisory Board appointed Mr. Alessandro Decio
and Mr. Roberto Nicastro to the Finance Committee.
From June 1st 2011, the Finance Committee was composed of the following persons:
Alessandro Decio,
Enrico Pavoni,
Roberto Nicastro.
The composition of the Finance Committee did not change as at December 31st 2011.
The Finance Committee operates on the basis of the Supervisory Boards
resolution. Its role is to exercise supervision over the implementation of
the Banks financial objectives. Members of the Committee have the right
to use services of advisers.
Representations of
the Banks Management Board
The Management Board of Bank Pekao S.A. declares to the best of its
knowledge that:
Consolidated Financial Statements of the Bank Pekao S.A. Group for
the period ended on 31 December 2011 and comparative figures have
been prepared in accordance with the binding accounting policies and
that they reflect in atrue, fair and clear manner the Bank Pekao S.A.
Group financial position and their results,
Report on the activities of the Bank Pekao S.A. Group for the year
2011 provides the true picture of the Bank Pekao S.A. Group development, achievements and situation, including the main threats and risks.
The Management Board of Bank Pekao S.A. declares that the registered
audit company performing the review of Consolidated Financial Statements of the Bank Pekao S.A. Group for the period ended on 31 December 2011 has been selected in line with the binding legal regulations.
The company and the registered auditors performing the review meet
the requirements indispensable for issuing an objective and independent
report on the annual consolidated financial statement, in line with the
binding provisions of the law and professional standards.
Consolidated Financial Statements

of Bank Pekao S.A. Group
for the period ended on 31 December 2011
(in PLN thousand)
Opinion of the independent auditor
142
Consolidated income statement
144
Consolidated statement of comprehensive income
145
Consolidated statement of financial position
146
Consolidated statement of changes in equity
147
Consolidated cash flow statement
149
Notes tofinancial statements
150
Annexes tothe financial statements
270
Consolidated Financial Statements of Bank Pekao S.A. Group for the period ended on 31 December 2011
Translation of a document originally issued in Polish
Opinion of the independent auditor

(in PLN thousand)
This document is afree translation of the Polish original. Terminology current in

Anglo-Saxon countries has been used where practicable for the purposes of this
translation in order toaid understanding. The binding Polish original should be
referred toin matters of interpretation.
Tothe General Meeting of Bank Polska Kasa Opieki Spka Akcyjna
Auditors Responsibility
We have audited the accompanying consolidated financial statements

of Bank Polska Kasa Opieki Spka Akcyjna Group, seated in Warsaw,
ul. Grzybowska 53/57 (the Group), which comprise the consolidated
statement of financial position as at 31 December 2011, the consolidated
income statement and the consolidated statement of comprehensive
income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended and notes tothe
consolidated financial statements, comprising of asummary of significant
accounting policies and other explanatory information.
Our responsibility, based on our audit, is toexpress anopinion on these

consolidated financial statements. We conducted our audit in accordance
with section 7 of the Accounting Act, national standards on auditing issued by the Polish National Council of Certified Auditors and International
Standards on Auditing. Those standards require that we comply with
ethical requirements and plan and perform the audit toobtain reasonable
assurance whether the consolidated financial statements are free from
material misstatement.
Managements and Supervisory Boards Responsibility for the Financial

Statements
Management of the Parent Entity is responsible for the preparation and
fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards as adopted by the
European Union and with other applicable regulations and preparation of
the Report on the Groups activities. Management of the Parent Entity is
also responsible for such internal control as management determines is
necessary toenable the preparation of consolidated financial statements
that are free from material misstatement, whether due tofraud or error.
According tothe Accounting Act dated 29 September 1994 (Official Journal from 2009, No. 152, item 1223 with amendments) (the Accounting
Act), Management of the Parent Entity and members of the Supervisory
Board are required toensure that the consolidated financial statements
and the Report on the Groups activities are in compliance with the
requirements set forth in the Accounting Act.
Anaudit involves performing procedures toobtain audit evidence about

the amounts and disclosures in the consolidated financial statements. The
procedures selected depend on our judgment, including the assessment
of the risks of material misstatement of the consolidated financial statements, whether due tofraud or error. In making those risk assessments,
we consider internal control relevant tothe entitys preparation and fair
presentation of the consolidated financial statements in order todesign
audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing anopinion on the effectiveness of the entitys
internal control. Anaudit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates
made by management, as well as evaluating the overall presentation of
the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate toprovide abasis for our opinion.
(in PLN thousand)
Opinion
Other Matters
In our opinion, the accompanying consolidated financial statements of

Bank Polska Kasa Opieki Spka Akcyjna Group have been prepared and
present fairly, in all material respects, the financial position of the Group
as at 31 December 2011 and its financial performance and its cash
flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union, and are in
compliance with the respective regulations that apply tothe consolidated
financial statements, applicable tothe Group.
As required under the Accounting Act, we also report that the Report
on the Groups activities includes, in all material respects, the information required by Art. 49 of the Accounting Act and by the Decree of the
Ministry of Finance dated 19 February 2009 on current and periodic
information provided by issuers of securities and the conditions for recognition as equivalent information required by the law of anon-Member
State (Official Journal from 2009, No. 33, item 259) and the information
is consistent with the consolidated financial statements.
On behalf of KPMG Audyt Sp. z o.o. registration number 458

ul. Chodna 51, 00867 Warsaw
Signed on the Polish original
Signed on the Polish original
Certified Auditor No. 796

Director
Bogdan Dbicki
Director
Stacy Ligas
19 March 2012
Warsaw
Consolidated income statement

(in PLN thousand)
2011
FROM 01.01.2011 UNTIL 31.12.2011
2010
FROM 01.01.2010 UNTIL 31.12.2010
CONTINUING
OPERATIONS
DISCONTINUED
OPERATIONS
TOTAL
CONTINUING
OPERATIONS
DISCONTINUED
OPERATIONS
TOTAL
11
7,179,154
(2,752,670)
4,426,484
2,895,407
(467,852)
2,427,555
10,352
225,066
(93,692)
131,374
38,648
(17,309)
21,339
7,404,220
(2,846,362)
4,557,858
2,934,055
(485,161)
2,448,894
10,352
6,280,436
(2,325,531)
3,954,905
2,758,056
(411,205)
2,346,851
7,889
270,779
(122,010)
148,769
38,237
(17,060)
21,177
6,551,215
(2,447,541)
4,103,674
2,796,293
(428,265)
2,368,028
7,889
12
583,104
12,007
595,111
559,200
25,016
584,216

Gains (losses) on other financial instruments at
fair value through profit or loss
29
(15,757)
(15,757)
6,801
6,801
13
(501)
(501)
13,952
13,952

available for sale financial assets and held
tomaturity investments
14
75,161
(320)
242
289
75,403
(31)
125,869
5,664
1,734
1,380
127,603
7,044
76,762
(47)
76,715
121,273
354
121,627
(1,281)
7,506,398
164,962
(1,281)
7,671,360
(1,068)
7,015,467
196,696
(1,068)
7,212,163
(533,407)
(4,532)
(537,939)
(485,887)
(52,041)
(537,928)
(551,856)
(4,532)
(556,388)
(492,619)
(52,041)
(544,660)
18,449
6,972,991
(3,224,686)
(1,908,495)
(1,316,191)
(368,467)
(5,833)
74,901
(3,524,085)
69,968
160,430
(76,896)
(37,659)
(39,237)
(9,026)
(836)
(86,758)
18,449
7,133,421
(3,301,582)
(1,946,154)
(1,355,428)
(377,493)
(5,833)
74,065
(3,610,843)
69,968
6,732
6,529,580
(3,186,482)
(1,911,156)
(1,275,326)
(379,209)
(50,674)
66,377
(3,549,988)
68,269
144,655
(78,168)
(39,145)
(39,023)
(12,502)
37
(90,633)
6,732
6,674,235
(3,264,650)
(1,950,301)
(1,314,349)
(391,711)
(50,674)
66,414
(3,640,621)
68,269
400
400
(371)
(371)
3,519,274
(667,884)
73,672
(15,966)
3,592,946
(683,850)
3,047,490
(554,116)
54,022
(17,057)
3,101,512
(571,173)
2,851,390
2,841,708
9,682
57,706
57,706
2,909,096
2,899,414
9,682
2,493,374
2,488,269
5,105
36,965
36,965
2,530,339
2,525,234
5,105
20
10.83
0.22
11.05
9.49
0.14
9.63
20
10.83
0.22
11.05
9.48
0.14
9.62
NOTE
Interest income
Interest expense
Net interest income
Dividend income
Result on financial assets and liabilities held
for trading
Operating income
Net impairment losses on financial assets and
off-balance sheet commitments:
9
9
10
10
17

available for sale financial assets and held
tomaturity investments
personnel expenses
Operating costs
Gain on sale of discontinued operations
Gains (losses) on associates
Gains (losses) on disposal of property, plant
and equipment, and intangible assets
Income tax expense
Income tax on gain on sale of discontinued
operations
1.Attributable toequity holders of the Bank
2.Attributable tonon-controlling interest
Earnings per share (in PLN per share)
basic for the period
diluted for the period
15
16
18
19
Consolidated statement of comprehensive income

(in PLN thousand)
NOTE
Net profit
Other comprehensive income
Change in fair value of available-for-sale financial assets
Change in fair value of cash flow hedges
Income tax expenses on other comprehensive income
Other comprehensive income (net)
Total comprehensive income
19
2011
2010
2,909,096
2,899,414
9,682
2,530,339
2,525,234
5,105
58,647
(58,841)
(49,270)
9,187
(40,277)
2,868,819
2,859,137
9,682
11,964
17,320
67,569
15,496
112,349
2,642,688
2,637,583
5,105
Consolidated statement of financial position

(in PLN thousand)
NOTE
31.12.2011
31.12.2010
4,886,093
100
5,586,057
849,711
2,156,274
92,816,389
2,862,760
408,906
29,119,637
25,324,803
3,794,834
2,931,575
186,252
703,355
1,772,940
63,928
889,952
1,950
888,002
1,356,177
146,590,106
5,969,104
224
6,258,811
965,641
1,557,033
16,735
77,803,730
3,038,975
258,688
30,398,445
25,856,387
4,542,058
3,246,985
214,616
697,235
1,821,723
64,493
723,230
1,249
721,981
1,054,218
134,089,886
356,386
5,544,210
2,507,199
108,436,964
1,738,549
(17,475)
3,043,919
999,985
198,997
194,560
4,437
313,880
2,110,562
125,233,176
727,979
6,913,123
114,228
1,592,445
99,807,236
710,566
(40,127)
1,177,158
1,009,074
26,806
26,070
736
305,923
1,488,486
113,832,897
21,271,463
262,382
18,035,191
2,973,890
85,467
21,356,930
146,590,106
20,174,112
262,364
17,342,617
2,569,131
82,877
20,256,989
134,089,886
ASSETS

Debt securities eligible for rediscounting at Central Bank
Loans and advances tobanks
Financial assets held for trading
Derivative financial instruments (held for trading)
Other financial instruments at fair value through profit or loss
Loans and advances tocustomers
Receivables from finance leases
Hedging instruments
Investments securities
1. Available for sale
2. Held tomaturity
Assets held for sale
Investments in associates and subsidiaries
Intangible assets
Property, plant and equipment
Investment properties
Income tax assets
1. Current tax receivable
2. Deferred tax assets
Other assets
TOTAL ASSETS
22
23
24
25
26
27
28
29
30
32
33
34
35
36
19
37
EQUITY AND LIABILITIES
Liabilities
Amounts due toCentral Bank
Amounts due toother banks
Financial liabilities held for trading
Amounts due tocustomers
Hedging instruments
Fair value hedge adjustments of hedged items due tointerest rate risk
Liabilities associated with assets held for sale
Income tax liabilities
1. Current income tax payable
2. Deferred tax liabilities
Provisions
Other liabilities
TOTAL LIABILITIES
Equity
Equity attributable toequity holders of the Bank
Share capital
Other capital and reserves
Retained earnings and profit for the period
Non-controlling interest
TOTAL EQUITY
TOTAL EQUITY AND LIABILITIES
39
40
24
25
41
29
29
42
32
19
43
44
48
49
49
Dividend paid
Profit appropriation
Other
Other connected with consolidation
Equity as at 31.12.2011
262,382
Appropriation of retained earnings and

current year profit
703,381
64,875
37,096
27,779
18,035,191
703,381
(39,909)
(47,622)
17,342,617
11,849
2,157
9,692
(87,531)
262,364
18
18
SHARE CAPITAL
Revaluation of hedging financial

instruments net of tax
Management options
Options exercised (share issue)
Revaluation of management share options
Valuation of financial instrument
Revaluation of available-for-sale
investments net of tax
TOTAL OTHER
CAPITAL AND
RESERVES
9,126,501
9,124,344
2,157
2,157
SHARE
PREMIUM
100,000
1,537,850
100,000
1,437,850
GENERAL
BANKING RISK
FUND
599,988
27,779
27,779
7,153,186
599,988
6,525,419
OTHER
RESERVE
CAPITAL
(65,432)
(39,909)
(47,622)
22,099
(87,531)
REVALUATION
RESERVES
FROM
FINANCIAL
INSTRUMENTS
OTHER CAPITAL AND RESERVES
37,096
37,096
(98,976)
(136,072)
FOREIGN
CURRENCY
EXCHANGE
RATES
TRANSLATION
DIFFERENCES
OTHER
3,393
382,062
3,393
368,977
9,692
9,692
EQUITY ATTRIBUTABLE TO BANK STOCKHOLDERS
(1,784,640)
(703,381)
2,899,414
(6,634)
10,158
(16,792)
2,973,890
411,393
2,569,131
(1,784,640)
2,899,414
58,241
47,254
10,987
21,271,463
1,114,774
(39,909)
(47,622)
20,174,112
11,867
2,175
9,692
(87,531)
TOTAL EQUITY
RETAINED
EARNINGS AND ATTRIBUTABLE TO
CURRENT YEAR EQUITY HOLDERS
OF THE BANK
PROFIT
(7,110)
9,682
85,467
2,572
82,877
18
18
(1,791,750)
2,909,096
58,241
47,254
10,987
21,356,930
1,117,346
(39,909)
(47,622)
20,256,989
11,885
2,175
9,710
(87,531)
TOTAL EQUITY
(in PLN thousand)
NON
CONTROLLING
INTEREST
Dividend paid
Profit appropriation
Other
Other
262,364
Appropriation of retained earnings and

current year profit
1,637,638
41,373
43,488
(2,115)
17,342,617
1,637,638
54,731
14,130
15,587,032
7,713
4,112
3,601
68,861
262,331
33
33
SHARE CAPITAL
Revaluation of hedging financial

instruments net of tax
Management options
Options exercised (share issue)
Revaluation of management share options
Valuation of financial instrument
Revaluation of available-for-sale
investments net of tax
TOTAL OTHER
CAPITAL AND
RESERVES
9,124,344
9,120,232
4,112
4,112
SHARE
PREMIUM
100,000
1,437,850
100,000
1,337,850
GENERAL
BANKING RISK
FUND
1,533,986
(2,115)
(2,115)
6,525,419
1,533,986
4,993,548
OTHER
RESERVE
CAPITAL
22,099
54,731
14,130
(46,762)
68,861
REVALUATION
RESERVES
FROM
FINANCIAL
INSTRUMENTS
OTHER CAPITAL AND RESERVES
43,488
43,488
(136,072)
(179,560)
FOREIGN
CURRENCY
EXCHANGE
RATES
TRANSLATION
DIFFERENCES
OTHER
3,652
368,977
3,652
361,724
3,601
3,601
EQUITY ATTRIBUTABLE TO BANK STOCKHOLDERS
(761,096)
(1,637,638)
2,525,234
3,975
579
3,396
2,569,131
126,500
2,438,656
(761,096)
2,525,234
45,348
44,067
1,281
20,174,112
1,764,138
54,731
14,130
18,288,019
7,746
4,145
3,601
68,861
TOTAL EQUITY
RETAINED
EARNINGS AND ATTRIBUTABLE TO
CURRENT YEAR EQUITY HOLDERS
OF THE BANK
PROFIT
(6,123)
5,105
825
825
82,877
(1,018)
83,057
13
13
(767,219)
2,530,339
46,173
44,067
2,106
20,256,989
1,763,120
54,731
14,130
18,371,076
7,759
4,145
3,614
68,861
TOTAL EQUITY
(in PLN thousand)
NON
-CONTROLLING
INTEREST

Consolidated cash flow statement

(in PLN thousand)
NOTE
2011
2010
2,899,414
(6,557,083)
375,602
(69,968)
(77,133)
(1,157,032)
780,826
132,665
(599,241)
(15,012,535)
176,215
(364,964)
(146,142)
(135,197)
(1,740,506)
(114,228)
2,525,234
3,811,853
391,474
(68,269)
(121,256)
(1,103,507)
1,072,363
5,165,689
850,512
(1,423,735)
64,502
41,397
(56,530)
(3,688,805)
(838,079)
(867,126)
914,754
372
8,629,728
(11,156)
7,957
1,673,305
(646,779)
826,746
(3,657,669)
2,557,240
27,187
50,914
1,506,973
(550,211)
800,748
6,337,087
315,784,256
315,063,900
9,454
710,902
(313,181,226)
(312,873,289)
(307,937)
2,603,030
382,104,193
381,361,327
10,381
732,485
(390,326,554)
(389,926,008)
(400,546)
(8,222,361)
2,477,336
2,475,162
2,174
(2,397,636)
(612,996)
(1,784,640)
79,700
(974,939)
(974,939)
11,130,476
10,155,537
82,546
78,401
4,145
(1,719,998)
(958,902)
(761,096)
(1,637,452)
(3,522,726)
(3,522,726)
14,653,202
11,130,476
Cash flow from operating activities indirect method

Adjustments:
Depreciation expense
Share of profit (losses) in associates
(Gains) losses on investing activities
Interest and dividend
Change in loans and advances tobanks
Change in financial assets held for trading and other financial instruments at fair value through profit or loss
Change in derivative financial instruments (assets)
Change in loans and advances tocustomers and debt securities eligible for rediscounting at Central Bank
Change in receivables from finance leases
Change in investment securities available for sale
Change in tax assets
Change in other assets
Change in amounts due tobanks
Change in liabilities held for trading
Change in derivative financial instruments (liabilities)
and other financial instruments at fair value
Change in amounts due tocustomers
Change in debt securities issued
Change in provisions
Change in other liabilities
Income tax paid (negative sign)
Current tax expense
Net cash flows from operating activities
Cash flow from investing activities
Investing activity inflows

Sale of investment securities
Sale of intangible assets and property, plant and equipment
Other investing inflows
Investing activity outflows
Acquisition of investment securities
Acquisition of intangible assets and property, plant and equipment
Net cash flows from investing activities
Cash flows from financing activities
Financing activity inflows

Issue of debt securities
Issue of shares
Financing activity outflows
Redemption of debt securities
Dividends and other payments toshareholders
Net cash flows from financing activities
Total net cash flows
Net change in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at the end of the period
50
Notes tofinancial statements

(in PLN thousand)
1. General information
The parent company of the Bank Pekao S.A. Group (the Group) is Bank Pekao S.A. (hereinafter referred toas the Parent Company, the Bank), with
Head Office in Warsaw, at 53/57 Grzybowska Street, 00950 Warsaw. Bank Pekao S.A. was incorporated on 29 October 1929 in the Commercial Register of the District Court in Warsaw and has been continuously in operation since its incorporation.
Bank Pekao S.A. is registered in the National Court Registry Enterprise Registry of the Warsaw District Court XII Economic Division of the National
Court Registry in Warsaw under the reference number KRS 0000014843.
The Banks statistical REGON number is 000010205.
Both the Parent Company and the consolidating entities constituting the Capital Group has been estabilished for anindefinite period of time.
Bank Pekao S.A. Capital Group (Group or Bank Pekao S.A. Group) is part of the UniCredit S.p.A. Group with its seat in Roma, Italy.
The Banks shares are quoted on the Warsaw Stock Exchange. Banks securities, traded on regulated markets, are classified in the banking sector.
Bank Pekao S.A. is auniversal commercial bank, offering abroad range of banking services on domestic and foreign financial markets, provided toretail
and corporate clients, in compliance with the scope of services, set forth in the Banks Articles of Association. The Bank runs both PLN and forex operations, and it actively participates in both domestic and foreign financial markets. Moreover, acting through its subsidiaries, the Group provides stockbroking, leasing, factoring operations and offering other financial services.
(in PLN thousand)
2. Group structure
The Group consists of Bank Pekao S.A. as the parent entity and the following subsidiaries:
PERCENTAGE OF THE GROUPS OWNERSHIP
RIGHTS IN SHARE CAPITAL/voting
NAME OF ENTITY
LOCATION
CORE ACTIVITY
Public Joint Stock Company UniCredit Bank, including:

BDK Consulting Ltd.
Pekao Fundusz Kapitaowy Sp. z o.o.
Pekao Leasing Sp. z o.o. (*)
Pekao Faktoring Sp. z o.o.
Pekao Pioneer Powszechne Towarzystwo Emerytalne S.A.
Pekao Telecentrum Sp. z o.o.
Centrum Kart S.A.
Pekao Financial Services Sp. z o.o.
Pekao Leasing Holding S.A., including (*):
Pekao Leasing Sp. z o.o.
Holding Sp. z o.o./in liquidation/
Centrum Bankowoci Bezporedniej Sp. z o. o.
Pekao Property S.A., including:
Metropolis Sp. z o.o.
Jana Kazimierza Development Sp. z o.o.
Property Sp. z o.o./in liquidation/, including:
FPB Media Sp. z o.o.
Lutsk, Ukraine
Lutsk, Ukraine
Warsaw
Warsaw
Warsaw
Lublin
Warsaw
Cracow
Warsaw
Warsaw
Warsaw
Warsaw
Warsaw
Warsaw
Cracow
Warsaw
Warsaw
Warsaw
Warsaw
Warsaw
Banking
Consulting, hotel and transport services
Brokerage
Business consulting
Leasing services
Factoring services
Pension fund management
Services
Financial support
Financial services
Banking
Leasing services
Leasing services
Non-financial holding
Call-center services
Real estate development
Real estate management
31.12.2011
31.12.2010
100.00
99.99
100.00
100.00
36.49
100.00
65.00
100.00
100.00
100.00
100.00
80.10
50.87
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
99.99
100.00
100.00
36.49
100.00
65.00
100.00
100.00
100.00
100.00
80.10
50.87
100.00
100.00
100.00
100.00
100.00
100.00
100.00
(*) The total share of the Group in Pekao Leasing Sp. z o.o. equity is 87.36% (36.49% directly and 50.87% via Pekao Leasing Holding S.A.)
As at 31 December 2011, all of the subsidiaries have been consolidated.

Pekao Property S.A., Metropolis Sp. z o.o., Jana Kazimierza Development Sp. z o.o., Property Sp. z o.o. (in liquidation) and FPB Media Sp. z o.o. have
been consolidated for the first time.
Associates
Bank Pekao S.A. Capital Group has aninterest in the following associated entities:
PERCENTAGE OF THE GROUPS OWNERSHIP
RIGHTS IN SHARE CAPITAL/VOTING
NAME OF ENTITY
LOCATION
CORE ACTIVITY
Central Poland Fund LLC (*)

Xelion. Doradcy Finansowi Sp. z o.o. (*)
CPF Management
Polish Banking System S.A./in liquidation/
PPU Budpress Sp. z o.o./in liquidation/
Wilmington, Deleware USA

Warsaw
Warsaw
Warsaw
Warsaw
Tortola, British Virgin Islands
Warsaw
yrardw
Mutual fund
Financial intermediation
Asset management
Clearing house
Financial brokerage not operating
Pending liquidation
Pending liquidation
31.12.2011
31.12.2010
53.19
50.00
49.00
25.00
34.44
40.00
48.90
36.20
53.19
50.00
49.00
25.00
34.44
40.00
48.90
36.20
(*) The Group has no control over the entities due toprovisions in the Companys Articles of Association.
As at 31 December, 2011 the Group held no shares in entities under common control.
Notes tofinancial statements (cont.)

(in PLN thousand)
3. Approval of the Financial Statements

These Consolidated Financial Statements were approved for publication by the Banks Management Board on19 March 2012.
4. Significant accounting policies

4.1 Statement of compliance
The annual consolidated financial statements of the Bank Pekao S.A. Group have been prepared in accordance with International Financial Reporting
Standards as adopted by the European Union, and in respect tomatters that are not regulated by the above standards, in accordance with the requirements of the Accounting Act dated 29 September 1994 (Official Journal from 2002, No. 76, item 694, as amended) and respective operating regulations, and in accordance with the requirements for issuers of securities admitted or sought tobe admitted totrading on anofficial stock exchange listing
market.
4.2 Basis of preparation of Consolidated Financial Statements

General information
These Consolidated Financial Statements of the Group, which have been prepared for the period from January 1 toDecember 31, 2011, contain the
financial results of the Bank and of its subsidiaries, comprising the Group, as well as the results of associated entities, measured using the equity
method.
The financial statements have been prepared in Polish zloty, and all data in the financial statements are presented in PLN thousand (PLN 000), unless
indicated otherwise.
The financial statements have been prepared on agoing concern basis on the assumption that the Group will continue its business operations substantially unchanged in scope for aperiod of at least one year from the balance sheet date.
The consolidated financial statements include the requirements of all the International Financial Reporting Standards and International Accounting
Standards approved by the European Union and related interpretations.
During the period covered by the Financial Statements the Bank did not introduce significant changes in the accounting policy concerning valuation of
assets and liabilities and profit measurement in comparison with previous period.
The Consolidated Financial Statement does not take into consideration changes in standards and interpretations, which are awaiting approval or were
enacted after the balance sheet date (Annex I and Annex II tothe Consolidated Financial Statement).
In the opinion of the Group, no amendments tothe standards and interpretations will have amaterial influence on the Consolidated Financial Report,
save for the new IFRS 9 Financial Instruments.
IFRS 9 concerning financial assets published in November 2009 and in October 2010 in the scope of financial liabilities, will become effective for fiscal
years starting on 1 January 2013 or following that date. This standard replaces IAS 39 Financial Instruments Recognition and Valuation.
The main changes, introduced by the new standard, are as follows:
elimination of the category of available for sale financial assets and held tomaturity,
introduction of two categories of financial assets: subject tomeasured at amortized cost and measured at fair value,
new criteria for classification of financial assets, measured at amortized cost,
new principles for recognition of revaluation at fair value of investments into equity financial instruments,
elimination of the necessity toseparate embedded derivatives.
(in PLN thousand)
In 2011, the International Accounting Standards Board (IASB) approved and published new standards, in this:
IFRS 10 Consolidated Financial Statements,
IFRS 11 Joint Arrangements,
IFRS 12 Disclosure of Interests in Other Entities,
IFRS 13 Fair Value Measurement.
The Bank is currently conducting ananalysis toassess the potential impacts of the new standards on the financial statements.
On 12 May 2011 the International Accounting Standard Board issued IFRS 10 Consolidated Financial Statements which establishes principles for the
presentation and preparation of consolidated financial statements when anentity controls one or more other entities. IFRS 10 replaces the consolidation
requirements in SIC-12 ConsolidationSpecial Purpose Entities and IAS 27 Consolidated and Separate Financial Statementsand is binding for annual
periods starting from or after 1 January 2013. It is permitted tobe applied earlier, however. IFRS 10 is based on the existing rules which define the
concept of control as the determining factor when deciding whether anentetity should be included within the consolidated financial statements of the
parent company. The standard provides additional guidelines useful in assessing the existence of the control, where it is difficult todetermine.
On 12 May 2011 the International Accounting Standard Board published IFRS 11 Joint Arrangements, which becomes effective for reporting periods
starting from or after 1 January 2013 and provides for more realistic presentation of joint arrangements by focusing on rights and obligations resulting
from them and not on their legal form as it is currently. The standard overcomes inconsitencies in reporting joint arrangements by implementing asingle
method of accounting shares in jointly controlled entities.
On 12 May 2011 the International Accounting Standard Board issued IFRS 12 Disclosure of Interests in Other Entities. It is anew and comprehensive
standard defining the requirements of disclosure of all forms of interests in other entities, including subsidiaries, joint arrangements, associates and
other unconsolidated entities. IFRS 12 is effective for annual periods beginning on or after 1 January 2013. Its earlier application is allowed.
On 12 May 2011 the International Accounting Standard Board published IFRS 13 Fair Value Measurement. The standard, which becomes effective
for reporting periods starting from or after 1 January 2013, establishes asingle framework for fair value measurements and sets the obligation for
disclosure of data on fair value valuation. IFRS 13 does not set out when anasset, liability or entitys own equity instruments should be measured at fair
value. On the contrary, it describes how tomeasure fair value or disclosure the data under IFRS when other standards require or allow this (with few
exceptions).
Consolidated Financial Statements of the Group have been prepared based on the following valuation methods:
at fair value for: derivatives, financial assets and liabilities held for trading, financial assets recognized initially at fair value through profit or loss and
available-for-sale financial assets, except for those for which the fair value cannot be reliably measured,
at amortized cost for other financial assets, including loans and advances and other financial liabilities,
at historical cost for non-financial assets and liabilities,
non-current assets (or disposal groups) classified as held for sale are measured at the lower of the carrying amount or the fair value less costs tosell.
The accounting principles as described below have been consistently applied for all the reporting periods.
The principles have been applied consistently by all the Group entities.

(in PLN thousand)
4.3 Consolidation
Principles for consolidation
The consolidated financial statements of Bank Pekao S.A. Group include the financial data of Bank Pekao S.A. and its subsidiaries as at 31 December
2011. Financial statements of the subsidiaries are prepared for the same reporting date as those of the parent entity, using consistent accounting policy
within the Group in all important aspects.
All intra-group balances and transactions, including unrealized gains, have been eliminated. Unrealized losses are also eliminated, unless there is anobjective evidence of impairment, which should be recognized in the consolidated financial statements.
Investments in subsidiaries
Subsidiaries are entities controlled directly and indirectly by the Bank. Control is the power togovern the entitys financial and operating policies in
order toobtain economic benefits. Control is typically demonstrated by holding the majority of voting rights at the governing body of the entity. The
subsidiaries are consolidated from the date of obtaining control by the Group until the date that the control ceases.
At the acquisition date of asubsidiary (obtaining of control), the subsidiarys assets and liabilities are measured at fair value. The excess acquisition cost
over the fair value of net assets purchased is recognized as goodwill. If the acquisition cost is lower than the fair value of net assets purchased (negative
goodwill arises), the difference is recognized in the income statement.
The policy referred toabove does not apply tothe acquisition transactions of entities under common control, the assets and liabilities of which are
recognized at book value.
Recognition of common control transactions at book value
Business combinations under common control are excluded from the scope of IFRS. As aconsequence, following the recommendation included in
IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, in the absence of any specific guidance within IFRS, Bank Pekao S.A. adopted
the accounting policy consistently used in all business combinations under common control within the UniCredit Group, of which the Bank is amember,
which recognizes those transactions using book value.
The adopted accounting policy is as follows:
The acquirer recognizes the assets and liabilities of the target entity at their existing book value adjusted only as aresult of aligning the combining
enterprises accounting policies. Neither goodwill, nor negative goodwill is recognized.
The difference between the book value of the acquired net assets and the fair value of the amount paid is recognized in the Groups equity. In applying
the book value method of accounting, the comparative periods are not restated.
If the transaction results in the acquisition of non controlling interests, the acquisition of any non controlling interest is accounted for separately.
There is no guidance in IFRS how todetermine the percentage of non controlling interests acquired from the perspective of asubsidiary. Accordingly
Bank Pekao S.A. uses the same principles as the ultimate parent for estimating the value of non controlling interests acquired.
Investments in Associates
Anassociate is anentity over which the Group has significant influence, and that is neither asubsidiary nor ajoint venture. The Group usually holds from
20% to50% of the voting shares in anassociate. The equity method is calculated using the financial statements of the associated entities. The balance
sheet dates of the Group and its associates are usually the same.
The investment in associates is initially recognized at cost and the carrying amount is increased or decreased torecognize the Groups share of the
profit or loss of the associate after the date of acquisition, net of possible permanent impairment charges. The associates share of profit or loss is
recognized in the Groups profit or loss. The changes recognized directly in the equity of anassociate are recognized directly in the equity of the Group
in its proportionate share, and is disclosed, whenever appropriate, in the statement of change in equity. Disbursements from profit reduce the carrying
value of the investment.
(in PLN thousand)
If the Groups share in the losses of anassociate equals or exceeds the Groups share in the associate, the Group ceases torecognize further losses,
unless it assumed obligations or made apayment on behalf of the associate.
Unrealized profits or losses from transactions between the Group and associated entities are eliminated pro rata tothe Groups share in the associates.
Investments in entities under common control
The Groups participation in entities under common control is recognized using the equity method in accordance with the principles described for investments in associated entities.
4.4 Accounting estimates

Preparation of financial statements in accordance with IFRS requires the Management Board of the Bank tomake certain estimates and toadopt certain
assumptions, which affect the amounts presented in the financial statements and in the explanatory notes.
The estimates which were made as at each balance sheet date reflect the conditions which existed at those dates (e.g. market prices, interest rates,
foreign currency exchange rates). Although the estimates are based on the best knowledge of current conditions and activities which the Group will
undertake, the actual results may differ from such estimates.
Principal assumptions and subjective judgments adopted by the Group while making the estimates pertain primarily to:
Impairment of financial assets
The assumptions regarding the measurement of impairment of loans and advances are described in Note 4.7. in the part titled Impairment of financial assets.
Impairment of non-current assets
At each balance sheet date the Group reviews its assets for indications of impairment. Where such indications exist, the Group makes aformal
estimation of the recoverable value. If the carrying amount of agiven asset is in excess of its recoverable value, impairment is identified and awritedown is recorded toadjust the carrying amount tothe level of its recoverable value. The recoverable amount of anasset or acash-generating unit is
the higher of its fair value less costs tosell and its value in use.
If there are indications of impairment of corporate assets, which do not generate cash flows independently from other asset or group of assets, and
the recoverable value of the individual asset included among the group of assets cannot be determined, the Group establishes the recoverable value
at the level of acash generating unit towhich the given asset belongs. Estimation of the value-in-use of anasset (or cash generating unit) requires
assumptions tobe made regarding, among others, future cash flows which the Group may obtain from the given asset (or cash generating unit), any
changes in amount or timing of occurrence of these cash flows and other factors such as lack of liquidity. The adoption of different measurement
assumptions may affect the carrying amount of some of the Groups non-current assets.
Measurement of derivatives and unquoted debt securities available for sale
The fair value of derivatives and debt securities available for sale that do not have aquoted market price on anactive market is measured using
valuation models based on discounted cash flows. Options are valued using option valuation models. Variables used for valuation purposes include,
where possible, the data from observable markets. However, the Group also adopts assumptions concerning counterpartys credit risks which affect
the valuation of instruments. The adoption of other measurement assumptions may affect the valuation of these financial instruments.
Measurement of management share options
Assumptions made regarding measurement of management share options are described in Note 45 Share-based payment.

(in PLN thousand)
Calculation of provision for retirement and pension severance payments

The provision for severance payments is determined case-by-case, for each employee separately, in accordance with the projected individual eligibility forecast method.
The basis for the calculation of aprovision for anemployee is the expected amount of retirement or pension severance payment, depending upon:
the base amount of retirement or pension severance payment and the percentage rate dependent upon the duration of employment according
tothe rules of Corporate Collective Labour Agreement,
expected increase in the payment base until the retirement age.
The amount calculated as above is then actuarially discounted, taking into consideration the probability of anindividual reaching retirement age and
the financial discount rate.
The probability of agiven person reaching retirement age includes the possibility of dismissal from work, the risk of complete inability towork and the
risk of death.
The financial discount rate is based on the profitability of risk-free securities, denominated in the currency in which employee benefits are paid out.
Goodwill
The Bank performs anannual impairment test of goodwill, resulting from the merger of Bank Pekao S.A. with the organized part of Bank BPH S.A.
under the occurence of impairment prerequisites on ayearly basis.
4.5 Foreign currencies

Functional and presentation currency
The financial statements of individual Group entities, including the Banks Branch in Paris, are presented in their functional currencies, i.e. in the currency of the primary economic environment in which the entity operates. The Consolidated Financial Statements are presented in Polish zloty. Polish
zloty is the functional currency and the presentation currency of the Bank. The Group applies as the closing rate the average the National Bank of
Poland (NBP) exchange rate, valid as at the balance sheet date.
Transactions and balances
Foreign currency transactions are calculated into the functional currency using the spot exchange rate from the date of the transaction. Gains and
losses from foreign currency translation differences resulting from settlements of such transactions and from the statement of financial position valuation of monetary assets and liabilities expressed in foreign currencies are recognized in the income statement.
Foreign currency translation differences arising from non-monetary items, such as equity instruments classified as financial assets measured at fair
value through the profit or loss are recognized together with the changes in the fair value of that item in the income statement.
Foreign currency translation differences arising from non-monetary items such as equity instruments classified as available for sale financial assets
are recognized in the revaluation reserves.
Companies of the Group
The consolidation of assets and liabilities of foreign business entities are translated into Polish currency i.e. tothe presentation currency as per the
closing exchange rate for the balance sheet date. Revenues and expenses are translated at the average exchange rates calculated on the basis of the
exchange rates of the reporting period except for situations where exchange rates fluctuate significantly such that the average exchange rate is not
anacceptable approximation of the exchange rate from the transaction date. In such situations revenue and expenses are translated on the basis of
the exchange rate from the date of the transaction.
(in PLN thousand)
Financial statements of the Banks Branch in Paris and the Group foreign subsidiaries are translated into Polish zloty using the following exchange
rates:
totranslate statement of financial position items as at 31 December 2011 and as at 31 December 2010, average exchange rates announced by
the NBP on 31 December 2011 and on 31 December 2010, respectively, have been used:
PLN for UAH 1

PLN for EUR 1
31.12.2011
31.12.2010
0.4255
4.4168
0.3722
3.9603
for translation of income statement items for the period from 1 January 2011 until 31 December 2011 and for the period from 1 January 2010
until 31 December 2010, arithmetic average values of exchange rates have been used, announced by the NBP as at the last date of each month
during the period from 1 January 2011 until 31 December 2011 and during the period from 1 January 2010 until 31 December 2010, respectively, as follows:
PLN for UAH 1

PLN for EUR 1
2011
2010
0.3716
4.1401
0.3830
4.0044
The foreign exchange rate differences from the valuation of foreign entities are accounted for as aseparate component of equity.
Goodwill arising on acquisition of the entity operating abroad as well as any adjustments of the balance sheet value of assets and liabilities tofair value
arising on the acquisition of the entity are treated as assets and liabilities of aforeign entity i.e. they are expressed in the functional currency of the
overseas entity and translated at the closing exchange rate as described above.
4.6 Income statement

Interest income and expenses
The Group recognizes in the income statement all interest income and expense related tofinancial instruments valued at amortized cost using the effective interest rate method, financial assets available for sale and financial assets at fair value through profit or loss.
The effective interest rate is the discount rate of estimated future cash inflows and payments made during the expected period until the expiry of the
financial instruments, and in justified cases in ashorter time, tothe net carrying amount of such financial assets or liabilities. The calculation of the
effective interest rate includes all commissions paid and received by parties tothe agreement, transaction costs and all other premiums and discounts,
comprising anintegral part of the effective interest rate.
Interest income includes interest and commission fees received or due from credits, interbank deposits and held tomaturity securities, recognized in the
calculation of effective interest rate, as well as from securities available for sale and measured at fair value through the income statement.
At the recognition of impairment of financial instruments measured at amortized cost and of available for sale financial assets, the interest income is accrued based on the carrying amount of the receivable (this is the new, lower value reduced by the impairment charge) using the interest rate used when
discounting the future cash flows for impairment calculation.
Interest expense of the reporting period related tointerest liabilities associated with client accounts and liabilities from the issue of treasury stock are
recognized in the income statement using the effective interest rate.

(in PLN thousand)
Fee and commission income and expense

Fee and commission income is generated from financial services provided by the Group. Fee and commission income and expense is recognized in the
profit or loss using the following methods:
fees and commissions directly attributable tofinancial asset or liability origination (both income and expense) are recognized in the income statement
using the effective interest rate method and are described above,
fees and commissions relating tothe loans and advances without adefined repayment schedule and without adefined interest rate schedule e.g.
overdraft facilities and credit cards are amortized over the life of the product using the straight line method,
other fees and commissions arising from the Groups financial services offering (customer account transaction charges, credit card servicing transactions, brokerage activity and canvassing) are recognized in the income statement up-front when the corresponding service is provided.
Result on financial assets and liabilities held for trading include:
Foreign exchange result
The foreign exchange gains (losses) are calculated taking into account the positive and negative foreign currency translation differences, whether
realized or unrealized from the daily valuation of assets and liabilities denominated in foreign currencies. The revaluation is done using the average
exchange announced by the NBP on the balance sheet date.
The foreign exchange result includes the trade margins on foreign exchange transactions with the Groups clients, as well as swap points from
derivative transactions, entered into by the Group for the purpose of managing the Groups liquidity in foreign currencies.
Income from foreign exchange positions includes also foreign currency translation differences from valuation of investments in foreign operations
arising on disposal thereof. Until the disposal, foreign currency translation differences from valuation of assets in foreign operations are recognized in
other capital and reserves.
Income from derivatives and securities held for trading
The income referred toabove includes gains and losses realized on asale or achange in the fair value of assets and liabilities held for trading.
The accrued interest and unwinding of adiscount or apremium on securities held for trading is presented in the net interest income.
Gains (losses) on financial assets/liabilities at fair value through profit or loss
This includes gains and losses realized on asale or achange in the fair value of assets and liabilities, designated at fair value through profit or loss.
The accrued interest and unwinding of adiscount or apremium on financial assets/liabilities designated at fair value through profit or loss are recognized in the interest result.
Other operating income/expense
Other operating income includes mainly amounts received for compensation, penalties and fines, revenues from operating leases and releases of provision for legal cases. Other operating expenses include mainly the costs of client claims, compensation paid and costs of provision for litigations.
(in PLN thousand)
4.7 Valuation of financial assets and liabilities, derivative financial instruments

Financial assets
Financial assets are classified into the following categories:
Financial assets measured at fair value through profit or loss
This category comprises two sub-categories: financial assets held for trading and financial assets designated at initial recognition as financial assets
measured at fair value through profit or loss.
Financial assets held for trading include: debt and equity securities, loans and receivables purchased or classified into this category for the purpose of
disposal thereof on ashort-term basis. The classification also includes derivative instruments (not used as hedging instruments).
Financial assets classified at the moment of original recognition as financial assets measured at fair value through profit or loss include debt securities acquired by the Group for the purpose of elimination or considerable reduction of inconsistencies in the valuation between these securities and
the derivatives, which are economically hedging the interest rate risk of such securities. Otherwise, such securities would have been classified into
the available for sale portfolio, with the effect of valuation recognized in revaluation reserves, and valuation of derivatives economically hedging such
securities reported in the income statement.
Held tomaturity
These are non-derivative financial assets with fixed or determinable payments and fixed maturity, for which the entity has anintent and ability tohold
tomaturity, other than:
a) those that the entity upon initial recognition designates as at fair value through profit or loss;
b) those that the entity designates as available for sale; and
c) those that meet the definition of loans and receivables.
Financial assets classified into this category are measured at amortized cost using the effective interest rate method. The recognition of amortized
cost with the use of effective interest rate is recognized in interest income.
Loans and receivables
Loans and receivables are non-derivative financial assets, with fixed or determinable payments, not quoted on active markets, other than:
a) those that the entity intends tosell immediately or in the near term which are classified as held for trading and those that the entity designates as
at fair value through profit or loss upon initial recognition;
b) those that the Group upon initial recognition designates as available for sale; or
c) those for which the holder may not recover substantially all of its initial investment, other than because of credit deterioration, which are classified
as available for sale.
This category also contains debt securities, purchased from the issuer, for which there is no active market, as well as credits, loans, receivables from
reverse repo transactions and other receivables acquired and granted. Loans and receivables are measured at amortized cost using the effective
interest rate method and with consideration of impairment.
Available for sale
This includes financial assets with anundefined holding period. The portfolio includes: debt and equity securities, as well as loans and receivables
not classified into other categories. Interest on assets available for sale is calculated using the effective interest rate method, and recognized in the
income statement.
Available for sale financial assets are measured at fair value, whereas gains and losses resulting from changes in fair value against amortized cost
are recognized in the revaluation reserves. Amounts in the revaluation reserves are recognized in the income statement either on the sale of anasset,
or its impairment. In case of impairment of anasset, previous increases from revaluation tofair value will decrease the Revaluation reserves. Should
the amount of previously recognized increases be insufficient tocover the impairment, the difference will be recorded in the income statement as Net
impairment losses on financial assets and off-balance sheet commitments.
Dividends from equity instruments are recognized in the profit or loss at the moment the rights toreceive such payments are established.

(in PLN thousand)
Standardized purchase and sale transactions of financial assets designated at fair value through profit or loss, designated as held for trading (except for
derivatives), held tomaturity, and available for sale, are recognized and derecognized by the Group on the settlement date of such transaction, i.e. as at
the date of receipt or delivery of such assets.
Changes in the fair value of assets, which occur during the period from transaction date totransaction settlement date, shall be recognized similarly as
in the case of the asset held.
Credits and loans are recognized on the date of cash disbursement tothe debtor.
Derivative instruments are recognized and derecognized on transaction dates.
Reclassification of financial assets
The Group may reclassify the financial assets classified as available for sale, which meet the definition of loans and receivables, from the category of
available for sale financial assets tothe category of loans and receivables, if the Group has the intent and the ability tohold such financial assets in
foreseeable future or until their maturity.
If the financial asset with agiven maturity is reclassified, prior gains and losses associated with such asset, recognized in other comprehensive income,
are amortized in the profit or loss throughout the remaining period until maturity, using the effective interest rate method. Any differences between such
new amortized cost and embedded amount is amortized throughout the period remaining until the maturity of such asset using the effective interest rate
method, similar topremium or discount amortization.
The Group allows the reclassification of financial assets classified as financial assets measured at fair value through profit or loss, if extraordinary
circumstances occur.
Such financial assets are reclassified at fair value as at reclassification date. The gains or losses recognized in the profit or loss before such reclassification cannot be reversed. The fair value of financial assets, as at reclassification date, is recognized as its new cost or its new amortized cost.
Impairment of financial assets
Assets valued at amortized cost loans and receivables
At each balance sheet date the Group assesses whether there is objective evidence of impairment of agiven financial asset or of agroup of assets. The
impairment of afinancial asset or agroup of assets occurs exclusively when objective evidence of impairment caused by events that followed the initial
recognition of agiven asset (the loss event) exists and when these loss events affect the expected cash flows and such cash flows may be reliably
estimated.
Objective triggers for impairment of financial assets include, among others, the following loss events:
substantial financial difficulties endured by the issuer or debtor,
failure tomeet the terms and conditions of contract, such as e.g. defaulting on arepayment or falling into arrears with interest, principal or commission fee payments by at least 90 days,
debt restructuring caused by debtors financial problems,
filing for insolvency recovery proceedings,
disappearance of active markets for given financial assets, caused by financial difficulties of the issuer,
starting enforcement proceedings,
observable data indicating ameasurable decrease in estimated future cash flows, associated with agroup of financial assets from initial recognition
of such assets, even if areduction for asingle item of such group of financial assets may not be determined, including:
adverse changes in the payment status of borrowers in the group, or
national or local economic situation, associated with the default on payment of assets within the group.
The Group classifies its loan receivables into individual and collective portfolios based on the size criteria.
In the individual portfolio each loan exposure is reviewed for impairment triggers on anindividual basis. In case of impairment, animpairment allowance
is recorded.
(in PLN thousand)
In case of the collective portfolio, loans are grouped into homogeneous pools with similar credit risk characteristics and collectively tested for
impairment.
When objective evidence of impairment of financial assets, classified as loans and receivables, receivables from finance lease or investments held
tomaturity, is identified, the amount of such impairment allowance recorded is equal tothe difference between the carrying amount of such anasset
and the present value of estimated future cash flows from repayments, collateral and other sources of repayment, discounted using the primary effective
interest rate, set forth at the initial recognition of given financial asset. The carrying amount of such asset is then reduced by the accumulated impairment allowances, which is recorded in the profit or loss for the given period.
The calculation of the present value of estimated cash flows, related tocollateralized financial assets also includes expected cash flows resulting from
the repossession of collateral reduced by the costs of such repossession and disposal.
Expected future cash flows related toagroup of financial assets, tested collectively for impairment, are estimated using the historical recovery parameters, generated from assets with similar risk characteristics.
Historical parameters of recoveries are adjusted toreflect the current circumstances, or toexclude observable historical data that is no longer relevant.
When the impairment amount is reduced subsequently toits initial measurement (e.g. debtors improved credit rating), the impairment allowance previously recorded is reversed. The amount of such reversal is recognized in the income statement.
For the portfolio of performing loans with no impairment triggers identified, the Group records aprovision for losses incurred but not reported (IBNR). The
IBNR impairment allowance reflects the loan impairment amount incurred as aresult of impairment events that have already occurred, which the Group
has not yet specifically identified at the balance-sheet date. This impairment allowance is determined using the historical pattern of losses on assets
with similar risk features. The IBNR impairment allowance is calculated using statistical models for loan groups combined in homogeneous portfolios
developed using historic observations data. The IBNR calculation takes into account the default emergence period concept for each type of homogeneous loan portfolio.
Financial assets available for sale
When adecline in the fair value of anavailable for sale financial asset has been recognized directly in equity and there is objective evidence that the
asset is impaired, the cumulative loss that has been recognized directly in equity is removed from equity and recognized in the income statement. The
amount of the cumulative loss transferred tothe income statement is the difference between the acquisition cost (net of any principal repayment and
amortization) and the current fair value. If, in asubsequent period, the fair value of adebt instrument classified as available for sale increases and the
increase can be objectively related toanevent occurring after the impairment loss was recognized in profit or loss, the impairment loss is reversed, with
the amount of the reversal recognized in the income statement.
If there is objective evidence that animpairment loss has been incurred on anunquoted equity instrument that is not carried at fair value because its fair
value cannot be reliably measured, the amount of the impairment loss is measured as the difference between the carrying amount of the financial asset
and the present value of estimated future cash flows discounted at the current market rate of return for asimilar financial asset.
Off-balance sheet liabilities
Aprovision for the impairment of off-balance sheet liabilities is calculated on the basis of the limit granted and the recoverable amount of the receivable,
defined as the current amount of estimated future cash flows discounted with the effective interest rate. Future cash flows relating tothe off-balance
sheet liabilities are calculated on the basis of the limit granted as at maturity date of this liability and the probability of outflow of the funds from the
Group.
Repo and reverse-repo agreements
Repo and reverse-repo transactions, as well as sell-buy back and buy-sell back transactions are classified as sales or purchase transactions of securities with the obligation of repurchase or resale at anagreed date and price.
Sales transactions of securities with the repurchase obligation granted (repo and sell-buy back) are recognized as at transaction date in amounts due
toother banks or amounts due tocustomers from deposits depending upon the counterparty tothe transaction. Securities purchased in reverse-repo

(in PLN thousand)
and buy-sell back transactions are recognized as loans and receivables from banks or as loans and receivables from customers, depending upon the
counterparty tothe transaction.
The difference between the sale and repurchase price is recognized as interest income or expense, and amortized over the contractual life of the
contract using the effective interest rate method.
Derivative financial instruments and hedge accounting
The Group acquires the derivative financial instruments: currency transactions (spot, forward, currency swap and currency options, CIRS), exchange rate
transactions (FRA, IRS, CAP), derivative transactions based on security prices and stocks indices. Derivative financial instruments are initially recorded at
fair value as at the transaction date and subsequently re-measured at fair value at each balance sheet date. The fair value is established on the basis of
market quotations for aninstrument traded in anactive market, as well as on the basis of valuation techniques, including models using discounted cash
flows and options valuation models, depending on which valuation method is appropriate. Positive valuation of derivative financial instruments is presented in the caption Derivative financial instruments as anasset, and as aliability if the change in the fair value is negative. For financial instruments
with anembedded derivative component, if the whole or part of the cash flows related tosuch afinancial instrument changes in away similar towhat
would be the case with the embedded derivative instrument on its own, then the embedded derivative instrument is reported separately from the basic
contract. This occurs under the following conditions:
the financial instrument is not included in assets held for trading or in assets designated at fair value through the profit or loss the revaluation results
of which are reflected in the financial income or expense of the reporting period,
the nature of the embedded instrument and the related risks are not closely tied tothe nature of the basic contract and tothe risks resulting from it,
aseparate instrument characteristics of which correspond tothe features of the embedded derivative instrument would meet the definition of the
derivative instrument,
it is possible toreliably establish the fair value of the embedded derivative instrument.
In case of contracts that are not financial instruments with acomponent of aninstrument meeting the above conditions the built-in derivative instrument
is classified in accordance with assets or liabilities of derivatives financial instruments with respect tothe income statement in accordance with derivative financial instruments valuation principles.
The method of recognition of the changes in the fair value of aninstrument depends on whether aderivative instrument is classified as held for trading
or is designated as ahedging item under hedge accounting.
The changes in fair value of the derivative financial instruments held for trading are recognized in the income statement.
The Group designates some of its derivative instruments as hedging items in applying hedge accounting. The Group implemented fair value hedge
accounting as well as cash flow hedge accounting, under the condition of meeting the criteria of IAS 39 Financial Instruments: Recognition and
Measurement.
Fair value hedge accounting principles
Changes in the measurement tofair value of financial instruments indicated as hedged positions are recognized in the part ensuing from hedged risk
in the income statement. In the remaining part, changes in the carrying amount are recognized in accordance with the principles applicable for the
given class of financial instruments.
Changes in the fair market valuation of derivative financial instruments, indicated as hedging positions in fair value hedge accounting, are recognized in
the profit or loss in the same caption, in which the gains/losses from change in the value of hedged positions are recognized.
Interest income on derivative instruments hedging interest positions hedged is presented as interest margin.
The Group ceases toapply hedge accounting, when the hedging instrument expires, is sold, dissolved or released (the replacement of one hedging
instrument with another or extension of validity of given hedging instrument is not considered anexpiration or release, providing such replacement or
extension of validity is apart of adocumented hedging strategy adopted by given unit), or does not meet the criteria of hedge accounting or the Group
ceases the hedging relation.
Anadjustment for the hedged risk on hedged interest position is amortized in the income statement at the point of ceasing toapply hedge accounting.
(in PLN thousand)
Cash flow hedge accounting principles

Changes in the fair value of the derivative financial instruments indicated as cash flow hedging instruments are recognized:
directly in the caption revaluation reserves in the part constituting the effective hedge,
in the income statement in the part representing ineffective hedge.
The amounts accumulated in the revaluation reserves are transferred tothe income statement in the period, in which the hedge is reflected in the
income statement and are presented in the same lines as individual components of the hedged position measurement, i.e. the interest income from
hedging derivatives in cash flow hedge accounting is recognized in the interest result, whereas gains/losses from foreign exchange revaluation are
presented in the foreign exchange gains (losses).
The Group ceases toapply hedge accounting when the hedging instrument expires or is sold. In such cases, the accumulated gains or losses related
tosuch hedging item, initially recognized in revaluation reserves, if the hedge was effective, are still presented in equity until the planned transaction
was closed and recognized in the income statement.
If the planned transaction is no longer probable, the cumulative gains or losses recognized in revaluation reserves are transferred tothe income statement for the given period.
Financial liabilities
The Groups financial liabilities are classified tothe following categories:
financial liabilities held for trading, valued at fair value,
financial liabilities not held for trading, valued at amounts payable, measured at amortized cost using the effective interest rate method.
Financial liabilities not held for trading consist of amounts due tobanks and customers, loans from other banks, and own debt securities issued.
De-recognition of financial instruments from the statement of financial position
Financial assets are derecognized when the contractual rights tothe cash flows from the financial assets expire or when the Group transfers the contractual rights toreceive the cash flows in atransaction in which substantially all risk and rewards of ownership of the financial asset are transferred.
The Group derecognizes acredit or aloan receivable, or its part, when it is sold. Additionally, the Group writes-off areceivable against the corresponding impairment provision when the debt redemption process is completed and when no further cash flows from the given receivable are expected. Such
cases are documented in compliance with the current tax regulations.
The Group derecognizes afinancial liability, or its part, when the liability expires. The liability expires when the obligation stated in the agreement is settled, redeemed or the period for its collection expires.
4.8 Valuation of other items in the Groups consolidated statement of financial position
Intangible assets
Goodwill
Goodwill is defined as asurplus of the purchasing price over the fair value of the assets, liabilities and contingent liabilities of the acquired subsidiary,
associate or aunit under joint control. Goodwill at initial recognition is carried at purchase price reduced by any accumulated impairment losses. Impairment is determined by estimating the recoverable value of the cash generating unit, towhich given goodwill pertains. If the recoverable value of the
cash generating unit is lower than the carrying amount animpairment charge is made. Impairment identified in the course of such tests is not subject
tosubsequent adjustments.
Goodwill on acquisition of subsidiaries is presented in intangible assets and goodwill on acquisition of associates is presented under the caption Investments in associates.

(in PLN thousand)
Other intangible assets

Intangible assets are assets controlled by the Group which do not have aphysical form which are identifiable and represent future economic benefits for
the Group directly attributable tosuch assets.
These mainly include:
computer software licenses,
copyrights,
costs of completed development works.
Intangible assets are initially carried at purchase price. Subsequently intangible assets are stated at cost less accumulated amortization and accumulated impairment losses.
Intangible assets with adefinite useful life are amortized over their estimated useful life. Intangible assets with indefinite useful life are not amortized.
All intangible assets are reviewed on aperiodical basis toverify if any significant impairment triggers occurred, which would require performing atest for
impairment and apotential impairment charge.
Property, plant and equipment are defined as controlled non-current assets and assets under construction. Non-current assets include certain tangible
assets with anexpected useful life longer than one year, which are maintained for the purpose of own use or tobe leased toother entities.
Property, plant and equipment are recognized at historical cost less accumulated depreciation and accumulated impairment write downs. Historical cost
consists of purchase price or development cost and costs directly related tothe purchase of agiven asset.
Each component of property, plant and equipment, the purchase price or production cost of which is significant compared tothe purchase price or
production cost of the entire item is asubject toseparate depreciation. The Group separates the initial value of property, plant and equipment into its
significant parts.
Subsequent expenditures relating toproperty plant and equipment are capitalized only when it is probable that such expenditures will result in future
economic benefits tothe Group, and the cost of such expenses can be reliably measured.
Service and maintenance costs of property, plant and equipment are expensed in the reporting period in which they have been incurred.
The cost of external financing for the purchase or construction of non-current assets is recognized by the Group as anexpense in the period in which it
is incurred.
Depreciation expense for property, plant and equipment and investment properties and the amortization expense for intangible assets are calculated
using straight line method over the expected useful life of anasset. Depreciated value is defined as the purchase price or cost todevelop agiven asset,
less residual value of the asset. Depreciation rates and residual values of assets, determined for balance-sheet purposes, are subject toregular reviews,
with results of such reviews recognized in the same period.
The statement of financial position depreciation and amortization rates applied toproperty, plant and equipment, investment properties and intangible
assets are as follows:
a) depreciation rates applied for non-current assets:
Buildings and structures and cooperative ownership rights toresidential premises and cooperative ownership rights tocommercial premises
Technical equipment and machines
Vehicles
1.5% 10.0%
4.5% 30.0%
12.5% 30.0%
(in PLN thousand)
b) amortization rates for intangible assets:

Software licenses, copyrights
Costs of completed development projects
Other intangibles
12.5% 50.0%
33.3%
33.0%
c) depreciation rates for investment properties:

Buildings and structures
1.5% 10.0%
Land, non-current assets under development and intangible assets under development are not subject todepreciation and amortization.
Depreciation and impairment deductions are charged tothe income statement in the item Depreciation and amortization.
Investment property assets are recognized initially at purchase cost, taking the transaction costs into consideration. Upon initial recognition, investment
property assets are measured using the purchasing price model.
Investment property assets are derecognized from the statement of financial position when disposed of, or when such investment property is permanently decommissioned and no future benefits are expected from its sale. Any gains or losses resulting from de-recognition of aninvestment property
are recognized in the income statement in the period when such de-recognition occurred.
Non-current assets held for sale
Non-current assets held for sale include assets, the carrying amount of which is tobe recovered by way of resale and not from their continued use.
The only assets classified as held for sale are those available for immediate sale in their present condition, and the sale of which is highly probable, i.e.
when the decision has been made tosell agiven asset, anactive program toidentify abuyer has been launched and the divestment plan is completed.
Moreover, such assets are offered for sale at aprice which approximates its present fair value, and it is expected that the sale will be recognized as
completed within one year from the date of such asset is reclassified into this category.
Non-current assets held for sale are recognized at the carrying amount or at fair value reduced by the cost of such assets, whichever is lower. Assets
classified in this category are not subject todepreciation.
Leases
The Group is aparty toleasing contracts on the basis of which it grants aright touse anon-current asset or anintangible asset for anagreed period of
time in return for payment.
The Group is also aparty toleasing contracts under which it receives aright touse anon-asset or anintangible asset for anagreed period of time from
another party in return for apayment.
Operating leases
In the case of leasing contracts entered into by the Group acting as lessor, the leased asset is presented in the Groups statement of financial position,
since there is no transfer tothe lessee of essentially all risks and benefits resulting from the asset.
In the case of lease agreements, entered into by the Group as lessee, the leased asset is not recognized in the Groups statement of financial position.
The entire amount of charges from operating leases is recognized in the profit or loss on astraight line basis, throughout the leasing period.

(in PLN thousand)
Finance leases
The Group as lessor
In the lease agreements, where essentially all risks and benefits relating tothe ownership of anasset are transferred, the leased asset is no longer
recognized in the statement of financial position of the Group. However, receivables are recognized in the amount equal tothe present value of the minimum lease payments. Lease payments are split into the financial income and the reduction of receivables balance in order tomaintain afixed interest
rate on the outstanding liability.
Lease payments from agreements, which do not meet the conditions of finance lease agreements are recognized as revenues in the income statement
using the straight-line method over the life of the lease.
The Group as lessee
For lease agreements in which in principle all risks and benefits relating toownership of the leased assets are transferred tothe Group, the leased asset
is recognized as anon-current asset and simultaneously aliability is recognized in the amount equal tothe present value of minimum lease payments
as at the date of commencement of the lease. Lease payments are split into costs of lease charges and areduction of liabilities in order tomaintain
afixed interest rate on the outstanding liability. Financial costs are recognized directly in the income statement.
Non-current assets subject tofinance lease agreements are depreciated in the same way as other non-current assets. However, if it is uncertain
whether the ownership of the asset subject of the contract will be transferred then the asset is depreciated over the shorter of the expected useful life or
the initial period of lease.
Lease charges from agreements that do not fulfill the criteria for finance lease agreements are recognized as costs in the income statement on
astraight line basis over the lease period.
Provisions
Provisions are recorded when the Group has anobligation (legal or constructive) resulting from the past events and where it is probable that the settlement of such obligation will result in anoutflow of economic benefits from the Group and it is possible toreliably estimate the amount of such liability.
If the time value of money is significant, the amount of provisions is established by discounting forecasted future cash flows tothe present value, using
adiscount rate corresponding tocurrent market estimates of money-over-time and the possible risk associated with such obligation.
Provisions also include provisions relating tolong-term employee benefits, subject toactuarial valuation. All provisions are charged tothe income
statements.
Employee benefits provisions
The provision for retirement and pension payments is calculated on the basis of anactuarial valuation performed by anindependent actuary at least
once ayear.
The provision for restructuring costs is recorded when the general criteria for provision recognition as well as the specific criteria for anobligation toestablish arestructuring provision under IAS 37 Provisions, contingent liabilities and contingent assets are met.
The amount of employment restructuring provision is calculated by the Group on the basis of the best available estimates of direct outlays resulting from
restructuring activities, which are not connected with the Groups current activities.
Provisions are recognized in liabilities under the caption Provisions and in the income statement as salary expense.
Deferred income and accrued expenses (liabilities)
This caption includes primarily commission income settled using the straight line method and other income charged in advance; that will be recognized
in the income statement in the future periods.
Accrued expenses include accrued costs resulting from services provided for the Group by counterparties which will be settled in future periods, accrued
payroll and other employee benefits (including annual and Christmas bonuses, other bonuses and awards and accrued holiday pay).
Deferred income and accrued expenses are presented in the statement of financial position under the caption Other liabilities.
(in PLN thousand)
Equity of the Group

Equity is comprised of the capital and funds created by the companies of the Group in accordance with the binding legal regulations and the appropriate
laws and Articles of Association. Equity also includes retained earnings. Subsidiaries equity line items, other that share capital, are added tothe relevant
equity line items of the parent company, in the proportion of the Groups interest.
The equity of the Group includes only those parts of the subsidiaries equity which were created after the date of purchase of shares or stocks by the
parent entity.
Group equity consists of the following:
a) share capital applies only tothe capital of the Bank as the parent entity and is presented at nominal value specified in the Statute and in the entry
in the Enterprises Registry,
b) issue premium surplus generated during share issues over the nominal value of such issues, remaining after the issue costs are covered. Moreover,
this item also includes achange in the value of minority shares, ensuing from anincrease of the share of the Parent entity in Banks share capital.
This accounting principle is in accordance with the accounting principles applied by UniCredit Group,
c) the general banking risk fund is established at Bank Pekao S.A. in keeping with the Banking Law of 29 August 1997 from profit after tax,
d) other reserve capital utilized for the purposes defined in the Statute is created from appropriations of profits,
e) revaluation reserve includes the impact of valuation of financial instruments available for sale, effects of valuation of derivative instruments hedging
cash flows and the value of deferred tax for items classified as temporary differences, recognized as valuation allowance. In the statement of financial
position, the valuation allowance is presented as net value,
f) exchange rate differences include differences arising from valuation of net assets in foreign entities and from the recalculation of the result of aforeign branch at the weighted average exchange rate at the balance sheet date in relation tothe average NBP exchange rate,
g) other capital:
other supplementary capital, established in keeping with provisions under the Articles of Association of companies from profit appropriations,
capital components:
bonds convertible toshares includes the fair value of financial instruments issued as part of transactions settled in equity instruments,
provision for purchase of parent entity stocks,
brokerage activity fund for stock broking operations, carried out by Bank Pekao S.A.,
retained earnings from prior periods includes undistributed profit and uncovered losses generated/incurred in prior periods by subsidiaries consolidated full method,
net profit/loss which constitutes profit/loss presented in the income statement for the relevant period. Net profit is after accounting for income tax.
Non-controlling interests
Non-controlling interests are defined as the equity in asubsidiary not attributable, directly or indirectly, tothe Bank.
Share-based payments
Employee participation programs are established by the Group under which key management staff is granted pre-emptive rights tobuy shares of the
Bank and shares of UniCredit S.p.A. (see Note 45).
Banks Pekao S.A. equity-settled share-based payment transaction
The cost of transactions settled with employees in equity instruments is measured by reference tothe fair value as at the grant date. The fair value is
assessed on the basis of the Black-Scholes model for appraisal of dividend-yielding stock options according toexpectations of the Management Board
concerning the number of rights tobe exercised. No efficiency/results data except those related tothe price of shares (market conditions) are taken
into account in the assessment of transactions settled in equity instruments.
The cost of share-based payments is recognized together with the accompanying increase in the value of equity in the period in which effectiveness/
performance conditions were fulfilled ending on the date when certain employees acquire full rights tothe benefits (vesting date). The accumulated
cost recognized for transactions settled in equity instruments for each balance sheet date until the vesting date reflects the extent of elapse of the vesting period and the number of rights toshares the rights towhich in the opinion of the Banks Management Board for that date based on best available
estimates of the number of equity instruments will be eventually vested. In the event of modifications of conditions for granting remuneration settled
in equities as apart of fulfillment of the minimum requirements costs are recognized as if such conditions have not changed. Also, costs are recognized
resulting from each increase in the value of the transaction resulting from modifications measured from the date of change.

(in PLN thousand)
When aright is cancelled or settled earlier, it is treated in such way as if the rights were acquired on the date of cancellation and any unrecognized
costs resulting from such rights are immediately recognized. In the case, however, where the cancelled share right is replaced by anew share right, the
cancelled right and the new right are treated as if they are amodification of the original right.
The diluting effect of options issued is taken into account in the calculation of earnings per share as additional dilution of shares (see Note 20).
Stock options and stock of the UniCredit S.p.A.
The Group entities joined the UniCredit-wide long term incentive program. The aim of the program is tooffer toselected key Groups employees share
options and shares of UniCredit S.p.A.
The fair value of the instruments granted tothe Group employees was established following the UCI Group-wide applied Hull and White model.
The expenses related tothe rights granted are recognized in Wages and salaries costs and respective increase is recognized in Banks equity presented in Other capital and reserves.
The Group is obliged topay toUniCredit S.p.A. the fair value of the instruments vested at the time the instruments are exercised.
4.9 Income tax

Income tax expense comprises current and deferred tax. The income tax expense is recognized in the income statement excluding the situations when it
is recognized directly in equity. The current tax is the tax payable of the Group entities on their taxable income for the period, calculated based on binding tax rates, and any adjustment totax payable in respect of previous years.
Deferred income tax assets and liabilities are calculated, using the balance sheet method, on temporary differences between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes. Deferred income tax is determined using tax rates based on legislation enacted or
substantively enacted at the balance sheet date and expected toapply when the deferred tax asset or the deferred tax liability is settled.
Adeferred tax asset is recognized for negative temporary differences tothe extent that it is probable that taxable profit will be available against which
the deductible temporary difference can be utilized.
Adeferred tax liability is calculated using the balance sheet method based on identification of positive temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purposes.
4.10 Other
Contingent liabilities and commitments
The Group enters into transactions which are not recognized in the statement of financial position as assets or liabilities, but which result in contingent
liabilities and commitments. Contingent liabilities are characterized as:
apotential obligation the existence of which will be confirmed upon occurrence or non-occurrence of uncertain future events that are beyond the
control of the Group (e.g. litigations),
acurrent obligation which arises as aresult of past events but is not recognized in the statement of financial position as it is improbable that it will
result in anoutflow of benefits tosettle the obligation or the amount of the obligation cannot be reliably measured (mainly: unused credit lines and
guarantees and letters of credit issued).
Cash and cash equivalents
Cash and cash equivalents in the consolidated cash flow statement include Cash and Due from the Central Bank and loans and receivables from
banks with maturities of up tothree months.
(in PLN thousand)
5. Purposes and rules of financial risk management

The risk management policy of the Group has agoal of optimizing the structure of the statement of financial position and off-balance sheet positions
under the consideration of all risks in relation toincome and other risk that the Group encounters in conducting its daily activity. Risks are monitored and
controlled with reference toprofitability and equity coverage and are regularly reported in accordance with rules briefly presented below.
All important risk types, occurring in the course of the Groups operations are described as follows.
5.1 Organizational structure of risk management

Supervisory Board
The Supervisory Board provides supervision over the risk management control system, assessing its adequacy and effectiveness. Moreover, the Supervisory Board also provides supervision of the compliance with Group policy with respect torisk management as it relates toGroups strategy and financial
planning.
Management Board
The Management Board is responsible for the development, implementation and functioning of risk management processes by introduction of relevant,
internal regulations, also taking into consideration the results of internal audit inspections.
The Banks Management Board is responsible for the effectiveness of the risk management system, internal control system, internal capital computation
process and the effectiveness of the review of the process of computing and monitoring of internal capital. Moreover, the Management Board also introduces the essential adjustments or improvements tothose processes and systems whenever necessary. This need may be aconsequence of changing
risk levels of Groups operations, business environment factors or other irregularities in the functioning of processes or systems.
Periodically, the Bank Management Board submits tothe Banks Supervisory Board concise information on the types, scale and significance of risks the
Group is exposed to, as well as on methods used in the management of such risks.
The Bank Management Board is responsible for assessing, whether activities such as identification, measurement, monitoring, reporting and control or
mitigation are being carried out appropriately within the scope of the risk management process. Moreover, the Management Board examines whether
the management at all levels is effectively managing the risks within the scope of their competence.
Assets, Liabilities and Risk Management Committee (ALCO)
The Committee is responsible for reviewing and controlling the risk management function. In particular, the tasks of ALCO include:
supervision and control over risk management,
setting guidelines for risk management, capital allocation and optimization of the risk/income ratio.
Risk Management Division
The Division is responsible for:
building asystem of credit risk management at the Bank, which provides the means for correct risk identification and management, establishing
arisk management structure and developing the essential know-how at all levels of the organization,
management and control of market risk and liquidity risk, generated in the course of commercial operations, as well as ensuing from the structure of
assets and liabilities,
identification and management of significant risks and assessment of aggregated economic capital,
development and enhancement of operational risk system, and identification and management of operational risk.

(in PLN thousand)
5.2 Credit risk

Credit risk is one of the basic risks associated with activities of the Group. The percentage share of credits and loans in the Groups statement of financial position makes the maintenance of this risk at safe level essential tothe Groups performance. The process of credit risk management is centralized
and managed mainly by Risk Management Division units, situated at the Bank Head Office or in local units. The integration of various risks in the Risk
Management Division, where apart from credit risk, market and operational risk are dealt with, facilitates effective management of all credit-related
risks. This process covers all credit functions credit analysis, making credit decisions, monitoring and loan administration, as well as restructuring and
collection. These functions are conducted in compliance with the Banks credit policy, adopted by the Banks Management Board and the Banks Supervisory Board for agiven year and its related guidelines. The effectiveness and efficiency of credit functions are achieved using diverse credit methods
and methodologies, supported by advanced IT tools, integrated into the Banks general IT system. The Banks procedures facilitate credit risk mitigation.
In particular those related totransaction risk evaluation, establishing collateral, setting authorization limits for granting loans and limiting of exposure
tosome areas of business activity in line with current clients segmentation scheme in the Bank.
The Banks lending activity is limited by the restrictions of the Banking Law as well as internal limits in order toincrease safety. These refer in particular
toconcentration limits for specific sectors of the economy, share of large exposures in the loan portfolio of the Bank and exposure limits for particular
foreign countries, banks and domestic financial institutions. Credit granting limits include not only credits, loans and guarantees, but also derivatives
transactions and debt securities.
The Bank established the following portfolio limits:
share of large exposures in the loan portfolio of the Bank approved by the Management Board and the Supervisory Board of the Bank,
customer segment limits established in the Banks credit policy,
product limits (mortgage loans given toprivate individuals, financing commercial real estate) established in the Banks credit policy,
concentration limits for specific sectors of the economy approved by the Credit Committee of the Bank.
Since key limits are determined by decision-making bodies which simultaneously receive and analyze reports on credit risk (presenting also the Basel
parameters of credit risk), limit-related decisions take into consideration the credit risk assessments supported by internal rating systems. Moreover,
the Bank limits higher risk credit transactions, marked by excess risk by restricting the decision-making powers in such cases tohigher-level decisionmaking bodies.
The management of the Banks credit portfolio quality is further supported by regular reviews and continuous monitoring of timely loan repayments and
the financial condition of the borrowers.
Rating models utilized in the credit risk management process
For credit risk management purposes, the Bank uses the internal rating models depending on the clients segment and/or exposure type.
The rating process is asignificant element of credit risk assessment in relation toclients and transactions, and constitutes apreliminary stage of the
credit decision-making process of granting anew credit or changing the terms and conditions of anexisting credit and of the credit portfolio quality
monitoring process.
In the credit risk measurement the following three parameters are used: Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default
(EAD). PD is the probability of aClients failure tomeet its obligations and hence the violation of contract terms and conditions by the borrower within
the one year horizon; such default may be subject-matter or product-related. LGD indicates the estimated value of the loss tobe incurred for any credit
transaction from the date of occurrence of such default. EAD reflects the estimated value of credit exposure as at such date.
The risk parameters used in the rating models are designed for calculation of the expected losses resulted from credit risk.
The value of expected loss is one of the significant assessment criteria taken into consideration by the decision-making bodies in the course of the
crediting process. In particular, this value is compared tothe requested margin level.
The level of minimum margins for given products or client segments is determined based upon risk analysis, taking into consideration the value of risk
parameters assessed and comprising anelement of internal rating systems.
(in PLN thousand)
The Client and transaction rating, as well as other credit risk parameters hold asignificant role in the Credit Risk Management Information System. For
each rating model, the credit risk reports provide information on the comparison between the realized parameters and the theoretical values for each
rating class.
Credit risk reports are generated on amonthly basis, with their scope varying depending upon the recipient of the report (the higher the management
level, the more aggregated the information presented). Hence, the reports are being effectively used in the credit risk management process.
Rating models were built based on client segments and types of credit products.
1. For the retail clients, the Bank has developed three separate models applicable for:
mortgage loans,
consumer loans,
non-installment loans (limits).
2. For the SME clients, the Bank uses models selected depending on the scope of information available. The models for SME are dedicated for:
full accounting records SME,
simplified accounting records SME,
private entrepreneurs.
3. The Bank divides clients belonging tocorporate segment (except for finacial institutions, municipalities and clients requiring specialist finansing) into
the following groups:
clients with income not exceeding PLN 30 million,
clients with income exceeding PLN 30 million.
For special-purpose loans, the Bank adopts slotting criteria approach within internal rating method which uses supervisory categories in the process of
assigning risk weigh category.
Percentage distribution for special-purpose loans portfolio exposure as at 31 December 2011 (excluding impairment provisions)
SUPERVISORY CATEGORY
High
Good
Satisfactory
Low
Total
NOMINAL VALUE
25.6%
67.2%
6.9%
0.3%
100.0%

(in PLN thousand)
Rating scale
The rating scale is determined by the client segment and the exposure type.
The procees of assigning aclient or anexposure toagiven rating class depends on its probability of default (PD parameter).
The tables below present the loan portfolio quality depending on percentage distribution of rating classes for exposures encompassed by internal rating
models.
The distribution of rated portfolio for individual client segment as at 31 December 2011 (excluding impairment provisions)
MORTGAGE LOANS
RATING
CLASS
1
2
3
4
5
6
7
8
9
10
Total
RANGE OF PD
0.00% <= PD < 0.19%

0.19% <= PD < 0.24%
0.24% <= PD < 0.31%
0.31% <= PD < 0.40%
0.40% <= PD < 0.61%
0.61% <= PD < 1.02%
1.02% <= PD < 2.20%
2.20% <= PD < 6.81%
6.81% <= PD < 14.10%
14.10% <= PD < 100.00%
CONSUMER LOANS
NOMINAL
VALUE
5.9%
12.8%
29.0%
34.8%
5.8%
1.8%
2.7%
2.9%
1.6%
2.7%
100.0%
RANGE OF PD
0.00% <= PD < 0.30%

0.30% <= PD < 0.50%
0.50% <= PD < 0.60%
0.60% <= PD < 0.80%
0.80% <= PD < 1.30%
1.30% <= PD < 2.10%
2.10% <= PD < 3.70%
3.70% <= PD < 7.20%
7.20% <= PD < 15.40%
15.40% <= PD <100.00%
NON-INSTALLMENT LOANS
NOMINAL
VALUE
6.7%
8.2%
5.4%
13.9%
17.2%
17.7%
13.9%
7.0%
3.1%
6.9%
100.0%
RANGE OF PD
0.00% <= PD < 0.01%

0.01% <= PD < 0.03%
0.03% <= PD < 0.04%
0.04% <= PD < 0.07%
0.07% <= PD < 0.15%
0.15% <= PD < 0.25%
0.25% <= PD < 0.59%
0.59% <= PD < 1.20%
1.20% <= PD < 2.58%
2.58% <= PD < 100.00%
NOMINAL
VALUEVALUE
0.5%
14.9%
9.9%
3.1%
7.6%
16.3%
18.9%
10.4%
14.2%
4.2%
100.0%
The distribution of rated portfolio for the SME clients as at 31 December 2011 (excluding impairment provisions)
RATING CLASS
1
2
3
4
5
6
7
8
9
10
Total
RANGE OF PD
NOMINAL VALUE
0.00% <= PD < 0.11%

0.11% <= PD < 0.22%
0.22% <= PD < 0.45%
0.45% <= PD < 1.00%
1.00% <= PD < 2.10%
2.10% <= PD < 4.00%
4.00% <= PD < 7.00%
7.00% <= PD < 12.00%
12.00% <= PD < 22.00%
22.00% <= PD < 100.00%
1.5%
4.3%
8.6%
17.2%
18.3%
15.6%
12.7%
9.3%
8.0%
4.5%
100.0%
(in PLN thousand)
The distribution of rated portfolio for the corporate clients as at 31 December 2011 (excluding impairment provisions)
RATING CLASS
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
Total
RANGE OF PD
NOMINAL VALUE
0.00% <= PD < 0.04%

0.04% <= PD < 0.08%
0.08% <= PD < 0.12%
0.12% <= PD < 0.19%
0.19% <= PD < 0.28%
0.28% <= PD < 0.42%
0.42% <= PD < 0.63%
0.63% <= PD < 0.94%
0.94% <= PD < 1.57%
1.57% <= PD < 2.50%
2.50% <= PD < 3.40%
3.40% <= PD < 4.37%
4.37% <= PD < 5.80%
5.80% <= PD < 7.80%
7.80% <= PD < 11.00%
11.00% <= PD < 20.00%
20.00% <= PD< 100.00%
0.0%
0.9%
1.8%
5.9%
8.3%
2.2%
9.6%
12.3%
8.2%
12.3%
4.6%
10.9%
5.9%
5.5%
6.2%
5.4%
0.0%
100.0%
Client/transaction rating and credit risk decision-making level

The rating received by anapplicant of agiven transaction directly impacts the decision-making criteria, which is associated with anapproval of
atransaction.
Decision-making entitlement limits are associated with the position held, determined in accordance with the Banks organizational structure. The limits
are determined taking the following matters into consideration:
the Banks total exposure toaclient, including the amount of the requested transaction,
type of aclient,
commitments of persons and entities associated with the client.
Validation of rating models
The internal validation of models and risk parameter assessments is focused on the quality assessment of risk models and the accuracy and stability
of parameter assessments, applied by the Bank. The validation covers risk models and parameters assessed locally, whereas the validation of central
models is carried out within UCI Group. Validation is carried out at the level of each risk model, although the Bank may apply several models for each
class of exposures.
Moreover, the internal audit unit is obligated toreview the Banks rating systems and their functionality at least once ayear. In particular, the internal
audit unit reviews the scope of operations of credit division and estimations of risk parameters. It also verifies compliance of rating systems and their
functionality with all requirements of advanced methods.

(in PLN thousand)
Exposure tocredit risk

The maximum credit risk exposure
The table below presents the maximum credit risk exposure for statement of financial position and off-balance sheet positions as at the reporting date,
with no collateral and other factors which limit the credit risk.
Due from Central Bank

Loans and advances from banks and from customers
Net investments in finance leases
Hedging instruments
Investment securities
Other assets
Balance sheet exposure
Obligations togrant loans
Other contingent liabilities
Off-balance sheet exposure
Total
31.12.2011
31.12.2010
2,649,856
98,402,546
2,862,760
849,711
2,156,274
408,906
29,119,637
1,377,833
137,827,523
26,443,978
8,967,573
35,411,551
173,239,074
3,495,772
84,062,765
3,038,975
965,641
1,557,033
16,735
258,688
30,398,445
1,207,365
125,001,419
24,581,149
9,038,392
33,619,541
158,620,960
(in PLN thousand)
Credit risk mitigation methods

Bank Pekao S.A. Group has established specific policies with regard tocollateral accepted tosecure loans and guarantees. This policy is reflected
under internal rules and regulations, which are based on supervision rules, specified in Enclosure No. 17 toResolution No. 76/2010 of Polish Financial
Supervision Authority (KNF).
The most frequently used types of collateral for credits and loans, accepted in compliance with the relevant policy of Pekao Group, are as follows:
COLLATERAL
COLLATERAL VALUATION PRINCIPLES
MORTGAGES
commercial
residential
Collateral value is defined as the fair market value endorsed by areal estate expert. Other evidenced sources of
valuation are acceptable, e.g. binding purchase offer, value dependent on the stage
of tendering procedure, etc.
REGISTERED PLEDGE/ASSIGNMENT
inventories
The value is defined basing on well evidenced sources e.g. amount derived from pledge agreement, amount
disclosed in last financial statement, insurance policy, stock exchange quotations, the value disclosed through
foreclosure procedure supported with evidence e.g. prepared by bailiff/receiver
machines and appliances
The value is defined as expert appraisal or present value determined based on other, sound sources, such as
current purchase offer, register of debtors non-current assets, value evidenced by bailiff or court receiver, etc
vehicles
other
securities and cash
The value is defined based on available tables (e.g. from insurance companies) proving the car value depending
on its producer, age, initial price, or other reliable sources e.g. value stated in the insurance policy.
The value is defined upon individually. The valuation should result from reliable sources.
The value is defined upon individually estimated fair market value. Recovery rate shall be assessed prudently
reflecting the securities price volatility.
TRANSFER OF RECEIVABLES
from clients with investment rating assigned by

independent rating agency or by internal rating
system of the Bank
from other counterparties
The value is defined upon individually assessed claims amount.

GUARANTIES/SURETIES (INCL. RAFTS)/ACCESSION TO DEBT
from banks and the State Treasury

from other counterparties enjoying good financial
standing, particularly when confirmed by
investment rating, assigned by anindependent
rating agency or by the internal rating system of
the Bank
from other counterparties
Up tothe guaranteed amount.
Individually assessed fair market value.
The financial effect of pledged collaterals for exposure portfolio with recognized impairment defined individually amounts toPLN 920 127 thousand
as at the 31st December 2011 (PLN 821 455 thousand as of the 31st December 2010). The level of required impairment allowances for the portfolio
would increase by this amount, if the discounted cash flows from collateral were not taken into account during estimation.

(in PLN thousand)
Overall characteristics of monitoring process

The monitoring process is oriented at the identification of symptoms and threats, affecting the client, undertaking actions preventing the deterioration of
credit portfolio quality for the purpose of maximizing the probability of recovery of assets made available tothe client.
In particular, the monitoring of credit risk includes the control of timely debt service, analysis of clients financial standing, verification of meeting the
terms of credit agreement and reviewing the collaterals.
Loans for large corporate clients are monitored using the rating system and data from both internal and external sources of information. In case of small
and medium-size clients, the monitoring process is carried out using aninternal tool, embedded into the statistical behavioral model. Process efficiency
is further enhanced by regular reviews of the credit portfolio, carried out by representatives of the Risk Management Division and other Business Divisions for the purpose of determining the actual quality of individual exposures and of the entire credit portfolio.
The monitoring of individual clients is carried by IT systems and is based on the results of behavioral scoring.
Overall characteristics of provisioning model
The Group establishes loan loss provisions (LLP) in line with International Financial Reporting Standards (IFRS). LLP reflects the loan impairment and
whether the Group recognizes objective impairment triggers. Impairment of loans is recognized under anindividual and collective approach.
The process of identifying impaired exposures covered by individual valuation is carried out with the use of aninternal tool and consists of the following
stages:
1. identification, whether the impairment trigger for given acredit exposure has been recognized and, upon such identification, determination of the type
of such trigger and assignment of default status tothe exposure,
2. assessment of future cash flows, discounted using the effective interest rate, generated both from collateral and client operations,
3. calculation and registration of loan loss provision in the IT system.
Exposures covered by the collective approach valuation are classified into the default class for overdue amounts exceeding 90 days. For such exposures,
the loan loss provision is calculated using astatistical model.
If animpairment trigger is not recognized, the Group establishes provisions for incurred but not reported losses (IBNR) applying astatistical model of
expected loss.
The applied statistical models are based on historical data for homogenous groups of exposure.
Both the models and parameters applied in the establishment of loan loss provision are subject toregular validation.
(in PLN thousand)
The quality analysis of the Groups financial assets

The Group exposures tocredit risk with impairment recognized, broken down by delays in repayment
LOANS AND ADVANCES TO BANKS (*)
LOANS AND ADVANCES TO CUSTOMERS (*)
31.12.2011
31.12.2010
31.12.2011
31.12.2010
1,181
62,964
64,145
1,024
62,964
63,988
916,009
303,755
23,523
472,734
1,009,748
946,989
3,672,758
691,018
45,310
80,918
320,632
1,361,483
709,795
3,209,156
(1,181)
(54,000)
(55,181)
(1,024)
(54,000)
(55,024)
(120,060)
(167,011)
(8,724)
(140,467)
(670,243)
(787,883)
(1,894,388)
(122,570)
(9,716)
(9,966)
(96,204)
(995,141)
(574,159)
(1,807,756)
8,964
8,964
1,778,370
1,401,400
16,632
16,632
19,371
19,371
74,919
27,118
28,235
494,937
1,423,248
626,405
2,674,862
47,739
21,356
38,870
594,688
1,145,862
656,585
2,505,100
(16,628)
(16,628)
(19,361)
(19,361)
(43,533)
(16,776)
(17,293)
(307,941)
(1,185,341)
(622,183)
(2,193,067)
(32,229)
(12,192)
(21,186)
(362,505)
(943,559)
(650,451)
(2,022,122)
10
481,795
482,978
GROSS CARRYING AMOUNT OF EXPOSURE INDIVIDUALLY IMPAIRED
not past due

up to1 month
between 1 month and 3 months
between 3 months and 1 year
between 1 year and 5 years
above 5 years
Total gross carrying amount
ALLOWANCE FOR IMPAIRMENT
not past due

up to1 month
above 5 years
Total allowance for impairment
Net carrying amount of exposure individually impaired
GROSS CARRYING AMOUNT OF EXPOSURE COLLECTIVELY IMPAIRED
not past due

up to1 month
above 5 years
ALLOWANCE FOR IMPAIRMENT
not past due

up to1 month
above 5 years
Total allowance for impairment
Net carrying amount of exposure collectively impaired
(*) Receivables from banks and receivables from customers include net investments in finance leases.

(in PLN thousand)
The Group exposures tocredit risk with no impairment recognized, broken down by delays in repayment
LOANS AND ADVANCES TO
BANKS (*)
LOANS AND ADVANCES TO CUSTOMERS (*)

CORPORATE
RETAIL
31.12.2011
31.12.2010
31.12.2011
31.12.2010
31.12.2011
31.12.2010
5,578,140
5,578,140
6,255,682
6,255,682
57,843,701
864,221
252,639
94,158
59,054,719
48,457,358
853,489
182,719
67,235
49,560,801
33,123,595
1,439,555
219,130
117,329
34,899,609
28,331,724
1,168,971
184,717
112,900
29,798,312
(746)
(746)
(2,614)
(2,614)
(234,886)
(7,858)
(2,415)
(1,442)
(246,601)
(157,564)
(13,417)
(12,680)
(2,672)
(186,333)
(131,034)
(104,072)
(31,803)
(22,039)
(288,948)
(74,599)
(60,124)
(38,050)
(44,687)
(217,460)
5,577,394
6,253,068
58,808,118
49,374,468
34,610,661
29,580,852
GROSS CARRYING AMOUNT OF EXPOSURE WITH NO IMPAIRMENT
not past due

up to30 days
between 30 days and 60 days
above 60 days
IBNR PROVISION:
not past due

up to30 days
between 30 days and 60 days
above 60 days
Total IBNR provision
Net carrying amount of exposure
with no impairment
(*) Receivables from banks and receivables from customers include net investments in finance leases and debt securities eligible for rediscounting at Central Bank.
(in PLN thousand)
Classification of exposures todebt securities according toStandard & Poors ratings as at 31 December 2011
DEBT SECURITIES
RATING
HELD FOR TRADING
DESIGNATED
TO FAIR VALUE
THROUGH
PROFIT & LOSS
601,813
247,898
849,711
AAA
AA- toAA+
A- toA+
BBB+ toBBBBB+ toBBB+ toBbelow Bno rating
Total
AVAILABLE
FOR SALE
HELD TO MATURITY
14,885,948
10,421,317 (*)
25,307,265
3,119,353
675,481 (**)
3,794,834
REPO TRANSACTIONS
TOTAl
3,755,536
3,755,536
22,362,650
11,344,696
33,707,346
REPO TRANSACTIONS
TOTAL
1,659,889
1,659,889
19,671,430
13,354,418
33,025,848
(*) including NBP bills in anamount of PLN 9 718 216 thousand PLN
(**) including NBP bills in anamount of PLN 675 481 thousand PLN
Classification of exposures todebt securities according toStandard & Poors ratings as at 31 December 2010
DEBT SECURITIES
RATING
HELD FOR TRADING
DESIGNATED
TO FAIR VALUE
THROUGH
PROFIT & LOSS
768,237
197,404
965,641
16,735
16,735
AAA
AA- toAA+
A- toA+
BBB+ toBBBBB+ toBBB+ toBbelow Bno rating
Total
AVAILABLE
FOR SALE
HELD TO MATURITY
13,119,015
12,722,510 (*)
25,841,525
4,107,554
434,504 (**)
4,542,058
(*) including NBP bills in anamount of PLN 12 556 925 thousand

(**) including NBP bills in anamount of PLN 434 504 thousand

TRADING DERIVATIVES
Banks
Other financial institutions
Non-financial entities
Total
DERIVATIVE HEDGING INSTRUMENTS
31.12.2011
31.12.2010
31.12.2011
31.12.2010
1,764,980
22,342
368,952
2,156,274
1,350,453
5,794
200,786
1,557,033
95,595
313,311
408,906
87,573
171,115
258,688

(in PLN thousand)
Credit risk concentration

According tothe Banking Law the total exposure of aBank tothe risks associated with the single borrower or agroup of borrowers in which entities are
related by capital or management may not exceed 25% of abanks equity. In 2011 the maximum exposure limits set forth in the Banking Law were not
exceeded.
a) Breakdown by individual entities:
As at 31.12.2011
EXPOSURE TO 10 LARGEST CLIENTS OF THE BANK
Client 1
Client 2
Client 3
Client 4
Client 5
Client 6
Client 7
Client 8
Client 9
Client 10
Total
% SHARE OF
PORTFOLIO
1.8%
1.1%
1.0%
0.8%
0.7%
0.7%
0.6%
0.6%
0.6%
0.6%
8.5%
12.2% of the exposure is accounted by the State Treasury, while 87.8% pertains toexposure tolarge corporate clients. None of the exposures mentioned above were classified as non-performing
b) Concentration by capital groups:
As at 31.12.2011
EXPOSURE TO 5 LARGEST CAPITAL GROUPS
SERVICED BY THE BANK
Group 1
Group 2
Group 3
Group 4
Group 5
Total
% SHARE OF
PORTFOLIO
1.9%
1.9%
1.2%
1.1%
1.1%
7.2%
(in PLN thousand)
c) Breakdown by industrial sectors:

In order tomitigate credit risk associated with excessive sector concentration the Bank employs asystem for monitoring the sector structure of its credit
exposure. The system involves setting concentration ratios for particular sectors, monitoring the loan portfolio and procedures for exchanging information. The system is based on the lending exposure in particular types of business activity according tothe classification applied by the Polish Classification of Economic Activities (Polska Klasyfikacja Dziaalnoci PKD).
Concentration ratios are determined on the basis of the Banks current lending exposure tothe particular sector and risk assessment of each sector. Periodic comparison of the Banks exposure toparticular sectors with the current concentration ratio allows timely identification of the sectors in which the
concentration of sector risk may become excessive. Is such situation arises, ananalysis of the economic situation of the sector is performed considering
the current and predicted trends and the quality of the current exposure tothat sector. These measures enable the Bank todevelop policies that reduce
sector risk and allow for atimely reaction toachanging environment.
The table below presents the structure of exposures by industrial sectors (sectors with share of minimum 2%):
SECTOR DESCRIPTION
Services
Public administration
Real estate
Energy
Construction and timber industry
Manufacture of basic metals and fabricated metal products
Financial intermediation
Manufacture of chemical and pharmaceutical products
Transport
Manufacture of food products and beverages
Manufacture of pulp, paper and paper products, publishing and printing
Manufacture of vehicles
Telecommunication and IT
Other sectors
Total
31.12.2011
31.12.2010
16.9%
13.4%
12.4%
10.3%
8.4%
6.1%
5.7%
5.4%
4.1%
3.4%
2.9%
2.8%
2.8%
5.4%
100.0%
16.5%
9.6%
12.6%
11.8%
9.1%
6.1%
6.2%
6.0%
4.0%
3.9%
2.6%
2.8%
3.1%
5.7%
100.0%
Credit risk management of Public Joint Stock Company UniCredit Bank

The process of credit risk management in Public Joint Stock Company UniCredit Bank (Ukraine) (UCB) is consistent with the Credit Policy of Bank
Pekao S.A. Group and adopted tolocal environment in Ukraine.
The credit policy has been annually approved by the statutory bodies of Public Joint Stock Company UniCredit Bank and issued in the form of internal
regulation bounding within UCB.
Bank Pekao S.A. supervises and controls the underwriting process in UCB. All credit decisions are taken by the Management Board of the Public
Joint Stock Company UniCredit Bank, however for credits or total exposures above USD 5 million (or its equivalent in other currencies), only
upon approval by Bank Pekao S.A. The credit underwriting scheme is compliant with the standards of credit risk management that are currently
enforced in Bank Pekao S.A.

(in PLN thousand)
The below table presents loan portfolio of Public Joint Stock Company UniCredit Bank:
31.12.2011
31.12.2010
CORPORATE
RETAIL
CORPORATE
RETAIL
1,152,425
119,065
10,920
1,282,410
(26,171)
1,256,239
227,623
5,779
2,840
2,392
238,634
(997)
237,637
1,807,632
38,092
2,837
1,848,561
(37,757)
1,810,804
229,482
16,617
5,139
1,884
253,122
(2,808)
250,314
GROSS CARRYING AMOUNT OF EXPOSURE WITH NO IMPAIRMENT
not past due

up to30 days
between 30 days and 60 daysi
over 60 days
IBNR
Net carrying amount of exposure with no impairment
31.12.2011
31.12.2010
CORPORATE AND RETAIL
CORPORATE AND RETAIL
216,938
(144,609)
72,329
293,218
(108,616)
184,602
163,383
(93,917)
69,466
138,782
(78,691)
60,091
GROSS CARRYING AMOUNT OF IMPAIRED EXPOSURE
Individually impaired exposure

Gross carrying amount
Allowance for impairment
Net carrying amount of exposure individually impaired
Collectively impaired exposure
Gross carrying amount
Allowance for impairment
Net carrying amount of exposure collectively impaired
Most of credit portfolio of UCB consists of corporate loans, including receivables from the biggest companies from Ukraine. 25 largest debtors belonging
tointernational groups constitute 77.7% of corporate loans portfolio and 42.6% of all credit exposures of the Bank. Credit activities connected with
financing corporate clients concentrate on investment and working capital loans.
5.3. Market risk

The Group is exposed in its operations tomarket risk and other types of risk caused by changing market risk parameters.
Market risk is the risk of deteriorating financial result or capital of the Group resulting from market changes. The main factors of market risk are as
follows:
interest rates,
foreign exchange rates,
stock prices,
commodity prices.
The Group established amarket risk management system, providing structural, organizational and methodological procedures for the purpose of shaping the structure of statement of financial position and off-balance items toassure the achievement of strategic goals.
The main objective of market risk management is tooptimize financial results and the influence on the worth of economic capital assuring the implementation of financial goals, while keeping the exposure tomarket risk within the limits of risk approved by the Management Board and the Supervisory
Board.
The organization of the market risk management process is based on athree-tier control system, established in compliance with the best international
banking practices and recommendations from banking supervision. The process of market risk management has been formalized by the introduction of
numerous internal procedures. The procedures have been developed taking into consideration the split into the trading and banking books.
(in PLN thousand)
Market risk of the trading book

The Group management of market risk of the trading book aims at optimizing the financial results and assuring the highest possible quality of customer
service in reference tothe market accessability (market making) while staying within the limits of risk approved by the Management Board and the
Supervisory Board.
The main tool for market risk of the trading book measurement is Value at Risk model (VaR). Under normal market conditions, this value corresponds
tothe level of aone-day loss, which will not be incurred with the probability of 1%. VaR value is calculated with historical simulation method based on
2 years of historical observations of market risk factors dynamics.
The model is subject tocontinuous, statistical verification by comparing the VaR values toactual performance figures. Results of analyses carried out in
2011 and 2010 confirmed the adequacy of the applied model.
The table below presents the market risk exposure of the trading portfolio of the Group measured by Value at Risk in 2011:
IN PLN THS
foreign exchange risk

interest rate risk
Trading portfolio
IN PLN THS
foreign exchange risk

interest rate risk
Trading portfolio
31.12.2011
MINIMUM VALUE
AVERAGE VALUE
MAXIMUM VALUE
38
4,302
4,327
10
3,686
3,426
325
4,962
4,979
2,641
6,811
6,942
31.12.2010
MINIMUM VALUE
AVERAGE VALUE
MAXIMUM VALUE
121
4,401
4,307
10
3,644
3,633
319
5,046
5,234
2,453
7,525
8,172
Interest rate risk of the banking book

In managing the interest rate risk of the banking book the Group aims tomaximize the economic value of capital and achieve the planned interest result
within the accepted limits. The financial position of the Group in relation tochanging interest rates is monitored through the interest rate gap (repricing
gap), duration analysis, simulation analysis, stress testing and VaR.
The table below presents the sensitivity levels of the interest income (NII) tointerest rate decline by -100 b.p. and sensitivity levels of economic value
of the Groups equity (EVE) tointerest rate growth by +200 b.p. assuming perfect elasticity of the Groups administrated rates tothe markets rates
changes (excluding current accounts priced in PLN, for which the Group implemented the model adjusting the profile of products revaluation) as at the
end of December 2011 and 2010.
SENSITIVITY IN%
NII
EVE
31.12.2011
31.12.2010
(7.56)
(2.67)
(7.51)
(2.89)

(in PLN thousand)
Currency risk
Currency risk management is performed simultaneously for the trading and the banking book. The objective of currency risk management is tomaintain
the currency profile of statement of financial position and off-balance items within the internal limits. For internal needs, the Groups exposure tocurrency risk is measured daily using the VaR model, as well as stress testing analysis, which serves as asupplement tothe VaR method.
The table below presents the Groups foreign currency risk profile by major foreign currencies measured at Value at Risk:
CURRENCY
USD
EUR
CHF
Other
Currencies total (*)
31.12.2011
31.12.2010
674
1,686
120
54
2,196
577
1,392
203
79
1,463
(*) VaR presented in Currencies total is VaR for the whole portfolio, and includes correlations among currencies.
5.4. Liquidity risk

The objective of liquidity risk management is to:
ensure and maintain the Groups solvency with respect tocurrent and future payables taking into account the cost of acquiring liquidity and return on
the Groups equity,
prevent the occurrance of crisis situations, and
provide solutions necessary tosurvive acrisis situation when such circumstances occur.
The Group invests primarily in treasury securities of the Government of the Republic of Poland, financial instruments of countries and financial institutions with highest ratings as well as with high levels of liquidity. Due totheir liquidity characteristics, regularly monitored, these financial instruments
would assist the Group toovercome crisis situations.
The Group is also monitoring daily the short-term (operating) liquidity, including financial market operations and the size of available stocks of liquid and
marketable securities, which may also serve as collateral offered toCentral Banks. Moreover, the Group is also monitoring the structural liquidity, which
includes awhole spectrum of the Group financial position, including long-term liquidity.
Financial liquidity management also includes the monitoring, limiting, controlling and reporting tothe Bank Management of anumber of liquidity ratios,
broken down by PLN and main foreign currencies and presented as aggregate values. In accordance with the banking supervisory recommendations,
the Group introduced internal liquidity indicators, defined as the ratio of adjusted maturing assets toadjusted maturing liabilities due in 1 month and
1 year, as well as covering ratios showing relation of adjusted maturing liabilities toadjusted maturing assets due in more than 1, 2, 3, 4 or 5 years.
The Group implemented emergency procedures Liquidity management policy in emergency situation, approved by the Management Board of the Bank,
defining the action in case of aliquidity risk increase and any substantial deterioration of the Groups financial liquidity.
This policy, referring tothe situation of the Groups deteriorating financial liquidity, includes daily monitoring of warning signals of systemic and specific
nature for the Group, including four degrees of threats toliquidity, depending upon the level of warning signals, the Group situation and market conditions. The policy also identifies the sources of coverage of such foreseen outflow of cash and cash equivalents from the Group. Apart from the above, the
document describes also liquidity monitoring procedures, contingency procedures and organizational structures of task teams responsible for restoring
the Groups liquidity, as well as the scope of liability of Banks management for taking the necessary decisions, associated with the restoration of the
necessary financial liquidity levels of the Group. Both the mentioned policy and the capacity toraise cash from sources specified in this plan are subject
toperiodic verification.
Scenario-based stress analyses, conducted on aweekly and monthly basis, constitute anintegral part of the Groups liquidity monitoring process,
launched under the conditions of crisis affected by financial markets or caused by internal factors, specific tothe Group.
(in PLN thousand)
Monitoring the liquidity, the Bank pays special attention tothe liquidity in foreign currencies through monitoring, limiting and controlling the liquidity
individually for each currency (according tothe description above) as well as monitoring demand for the current and future currency liquidity. In case
of identification of asuch need the Bank hedges using FX-swaps and CIRS. The Bank monitors also the potential influence of placing required margin
deposits on the liquidity in case of PLN depreciation.
The adjusted liquidity gaps described below present, inter alia, the adjustments concerning the stability of core deposits and their maturities, and
adjustments of flows due tooff-balance sheet commitments for financial liabilities granted and guarantees liabilities granted. The Group includes as well
the adjusted flows stemming from Bank security portfolio and flows resulting from earlier repayment of mortgage loans portfolio. These are the main
elements differentiating adjusted gaps from unadjusted ones. The maturity tables below present financial liabilities arranged according tocontractual
maturities.
Moreover the gaps are of static nature, i.e. they do not take into consideration the impact of volume changes (i.e. new deposits) upon the liquidity profile
of the Group statement of financial position and off-balance items, as well as of non-equity related cash flows.
Adjusted liquidity gap
31.12.2011
Assets
Liabilities
Net off-balance sheet items
Periodic gap
Cumulated gap
31.12.2010
Assets
Liabilities
Net off-balance sheet items
Periodic gap
Cumulated gap
UP TO 1 MONTH
45,526,280
30,663,738
(7,156,418)
7,706,124
UP TO 1 MONTH
48,274,712
27,018,795
(6,077,500)
15,178,417
BETWEEN 1 AND
3 MONTHS
BETWEEN
3 MONTHS AND
1 YEAR
BETWEEN
1 AND 5 YEARS
OVER
5 YEARS
5,614,045
9,405,829
(565,340)
(4,357,124)
3,349,000
23,308,493
14,643,212
3,918,985
12,584,266
15,933,266
38,030,544
23,503,301
1,997,968
16,525,211
32,458,477
34,110,744
68,374,026
739,875
(33,523,407)
(1,064,930)
BETWEEN 1 AND
3 MONTHS
BETWEEN
3 MONTHS AND
1 YEAR
BETWEEN
1 AND 5 YEARS
OVER
5 YEARS
5,536,693
8,154,288
(915,038)
(3,532,633)
11,645,784
20,311,719
12,310,009
3,484,173
11,485,883
23,131,667
34,352,311
23,103,661
2,275,237
13,523,887
36,655,554
25,614,451
63,503,133
927,442
(36,961,240)
(305,686)
TOTAL
146,590,106
146,590,106
(1,064,930)
(1,064,930)
TOTAL
134,089,886
134,089,886
(305,686)
(305,686)

(in PLN thousand)
Structure of financial liabilities by contractual maturities
31.12.2011
UP TO 1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS AND
1 YEAR
BETWEEN
1 AND 5 YEARS
OVER 5 YEARS
Total
2,346,613
83,537,474
102,372
85,986,459
53,846
12,475,470
421,968
12,951,284
585,092
11,744,056
1,540,198
13,869,346
1,176,093
621,711
582,323
2,380,127
1,738,952
58,253
397,058
2,194,263
5,900,596
108,436,964
3,043,919
117,381,479
26,812,064
26,812,064
8,478,540
8,478,540
35,290,604
35,290,604
UP TO 1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS AND
1 YEAR
BETWEEN
1 AND 5 YEARS
OVER 5 YEARS
TOTAL
4,145,015
80,786,722
84,931,737
89,224
9,960,054
468,848
10,518,126
436,147
8,095,964
121,604
8,653,715
1,529,940
839,211
586,706
104,280
3,060,137
1,440,776
125,285
9,948
1,576,009
7,641,102
99,807,236
1,177,158
114,228
108,739,724
24,698,614
24,698,614
8,586,138
8,586,138
33,284,752
33,284,752
BALANCE SHEET LIABILITIES
Amounts due tobanks (*)

Total
OFF-BALANCE SHEET COMMITMENTS (**)
Off-balance sheet commitments Financial liabilities

granted
Off-balance sheet commitments Guarantees
liabilities granted
Total
31.12.2010
BALANCE SHEET LIABILITIES
Amounts due tobanks (*)

Total
OFF-BALANCE SHEET COMMITMENTS (**)
Off-balance sheet commitments Financial liabilities

granted
Off-balance sheet commitments Guarantees
liabilities granted
Total
(*) Including Central Bank

(**) Exposure amounts from financing-related off-balance sheet commitments granted and guarantee liabilities granted have been allocated toearliest tenors, for which anoutflow of assets from
the Group is possible based on contracts entered into by the Group. However, the expected by the Group flows from off-balance exposures are actually significantly lower and are differently
distributed in time than those indicated from the specification presented above. The above is aconsequence of considerable diversification of amounts due tocustomers and stages of life of
individual contracts. Risk monitoring and management in relation tothe outflow of assets from off-balance exposures are provided by the Group on continuous basis. The Group estimates also
more probable flows that are presented in Tables Adjusted liquidity gap.
The tables below present the financial flows associated with off-balance derivative transactions.
According toGroups policy, off-balance derivative transactions settled in net amounts include:
Interest Rate Swaps (IRS),
Forward Rate Agreements (FRA),
Foreign currency options,
Interest rate options (Cap/Floor),
Options based on equity securities.
Off-balance derivative transactions settled by the Group in gross amounts include:
Cross-Currency Interest Rate Swaps (CIRS),
Foreign currency forward contracts,
Foreign currency swaps,
Securities forwards.
(in PLN thousand)
Liabilities from off-balance transactions on derivatives recognized in net amounts
31.12.2011
31.12.2010
UP TO 1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS AND
1 YEAR
BETWEEN
1 AND 5 YEARS
OVER
5 YEARS
Total
101,434
22,887
71,431
143,996
173,666
151,781
1,205,451
1,017,284
620,792
292,865
2,172,774
1,628,813
UP TO 1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS AND
1 YEAR
BETWEEN
1 AND 5 YEARS
OVER
5 YEARS
Total
18,727,936
18,762,803
6,060,237
6,175,994
7,314,767
7,511,198
8,905,958
9,217,329
2,305,670
3,055,606
43,314,568
44,722,930
12,514,108
12,281,818
3,795,325
3,723,635
9,359,938
9,198,525
5,613,787
5,650,211
2,744,660
3,167,064
34,027,818
34,021,253
Flows related tooff-balance derivative transactions settled in gross amounts
31.12.2011
inflows
outflows
31.12.2010
inflows
outflows
5.5 Operational risk

Qualitative information
Operational risk is defined as the risk of losses resulting from errors, regulation infringements, interruptions and damages caused by internal processes,
people, systems or external factors. Operational risk encompasses regulatory and legal risk. Strategic, business and reputational risks are separate risk
categories.
Operational risk management builds on internal procedures which are in compliance with the Banking Law, Polish Financial Supervision Authority
Resolution No. 76/2010 and 258/2011 (which replaces Resolution No. 383/2008), Recommendation M and standards set by the UniCredit Group.
Operational risk management embraces identification and estimation, monitoring, limiting and reporting system. The risk identification and evaluation
is performed with the analysis of external and internal data, scenario analysis, key operational risk indicators and self assessment review. Monitoring
activities are conducted as athree-level control comprising operating control (performed by all employees), risk management control (Operational Risk
Management Department) and internal audit (Internal Audit Department). Operational risk limitation includes internal control system, protection activities,
business continuity management plans as well as insurance policies.
Organizational structure
The Supervisory Board approves Banks strategy of operational risk management, which defines the concept of operational risk, principles of operational
risk management and internal control system referring tooperational risk. Moreover, the Supervisory Board controls the operational risk management
system and assesses its adequacy and efficiency e.g. on the basis of annual reports concerning the control of the operational risk.
The Management Board is responsible for designing, implementing and proper functioning of operational risk management process through introducing proper regulations. Also, it ensures the effectiveness of operational risk management system, internal control system and the process of capital
adequacy calculation by implementing necessary adjustments and enhancements in case of any changes in Banks operational risk level, economic
environment and irregularities in functioning of the systems and processes.
The Operational Risk Committee supports the Management Board in designing the proper system of operational risk management by the use of rules
set in the strategy of operational risk management. The Operational Risk Committee is responsible for, inter alia, monitoring of operational risk at the
level of the Group, evaluation of the operational risk management strategy, guidelines, policies, procedures, instructions as well as the model evaluating
operational risk management, assessment of system valuation reports, proposed limits of operational risk and approving the list of crucial risk indicators
with risk limits.

(in PLN thousand)
The Operational Risk Management Department monitors exposures of the Bank and its subsidiaries tooperational risk. Its main responsibilities are organizing the process of storing and registering of operating events in the operating event data base, monitoring of the key risk indicators, assessment of
scenario analysis, cooperation in analysis of operational risk impact when launching new products, checking whether the business continuity management plans are updated and tested on aregular basis, monitoring of protection activities and control over outsourcing risk management.
Reporting
The reporting system has been created in order toinform high-level management and the relevant control divisions about the Banks exposure tooperational risk and protection activities. In particular, the annual and quarterly reports on operational risk control present information on operating losses,
major risk indicators, significant operating events, capital adequacy ratio, main protection activities and the observed trend in frauds and similar events
in reference tocredit risk. Annual reports are presented tothe Supervisory Board, the Management Board and the Operational Risk Committee while the
quarterly reports are presented tothe Management Board and the Operational Risk Committee. Reports with key risk indicators are prepared monthly
and submitted toOperational Risk Coordinators, who are responsible for coordination of operational risk management in agiven department while the
results of scenario analysis are presented tothe Management Board and the Operational Risk Committee. Moreover, the weekly information referring
tosignificant internal and external operating events is sent toOperational Risk Coordinators.
Internal validation process
The internal validation process assesses the compliance of the management system and operational risk measurement with regulatory requirements
and standards of UniCredit Group. The validation is performed annually based on the self review done by the Operational Risk Management Department,
the results of which are incorporated into the Report on Internal Validation. That report is subject tothe independent review of the Internal Validation
Section in UniCredit Group. The results of both the self- and independent review are assessed by the internal audit and are pending approval from the
Management Board.
Capital adequacy requirements and allocation mechanism
In the first half of 2011, Bank Pekao S.A. was granted permission by regulators of Poland and Italy toapply the AMA method for calculation purposes of
operational risk capital requirement at the consolidated and solo level, in part related toBank Pekao S.A.
The Advanced Measurement Approach (AMA) togauge operational risk is based on the special treatment of data on internal and external losses,
scenario analysis and key risk indicators. The total capital requirement calculated according tothe advanced method, is allocated toparticular entities of
UniCredit Group. The capital requirement allocated reflects the profile of risk for each entity.
As at 31 December 2011, the Bank calculated the operational risk capital requirement in compliance with the above Decision. The operational risk
capital requirement for the Banks subsidiaries is calculated using the standard method.
Qualitative information
The table below depicts operating events grouped into categories regulated in the New Capital Accord of the Basel Committee and Resolution No.
76/2010 of the Polish Financial Supervision Authority:
internal frauds losses resulting from acts intended defraud, misappropriation of property, circumvention of regulations, the laws and internal policies
of acompany, excluding losses resulting from diversity or discrimination of employees, which concern at least one internal party,
external frauds losses being aconsequence of acts of defraud, misappropriation of property or circumvention of regulations performed by athird
party,
employment practices and workplace safety losses due toacts inconsistent with regulations or employment agreements, workplace health and
safety agreements, payments from personal injuries claims or losses from discrimination and unequal employee treatment,
clients, products and business practices losses arising from failures of meeting professional obligations towards clients due tounintended or negligent acts (including custody requirements and appropriate behavior) or concerning specific features or adesign of aproduct,
damages tophysical assets losses due todamage or loss of tangible assets resulting from natural disasters or other events,
business disruption and system failures losses stemming from business or system failures,
execution, delivery and process management losses resulting from failed transaction settlements or process management and losses from relations
with cooperating parties and vendors.
(in PLN thousand)
OPERATING EVENTS BY CATEGORIES
Internal frauds
External frauds
Employment practices and workplace safety
Clients, products and business practices
Damages tophysical assets
Business disruption and system failures
Execution, delivery and process management
Total
2011
5.24%
37.49%
27.45%
13.54%
5.62%
1.19%
9.47%
100.00%
In 2011, operational risk for the Group resulted primarily from losses on external frouds, which accounted for 37.49% of total losses. The second
category of high losses was employment practices and workplaces safety which comprised 27.45% of total losses and the third category clients,
products and business practices constituted 13.54% of share in total losses.
5.6 Business risk

Business risk is defined as adverse, unexpected changes in business volume and/or margins that are not caused by credit, market or operational risks.
The measurement of business risk is based on the Earnings at Risk EaR method. The method provides the means toestimate the risk of occurrence of
anunexpected, negative deviation of realized financial income from the level assumed in the financial plan. EaR is estimated for aone year time horizon
and at the confidence level of 99.97%.
5.7 Real estate risk

Real estate risk is caused by volatility of the market value of the Groups real estate portfolio. It covers the real estate portfolio of the Group. It does not
cover real estate acquired through vindication proceedings or those used as collateral backing the credits granted.
The risk of own real property is calculated for aone year time horizon, using the Value at Risk (VaR) method, at the assumed confidence level of 99.97%
and the standard method of calculating capital adequacy according toPillar I of the New Capital Accord of the Basel Committee.
5.8 Financial investments risk

Financial investment risk stems from the Groups banking book equity holdings in companies.
Financial investment risk is estimated for aone year time horizon using the Value at Risk (VaR) method, at the assumed confidence level of 99.97%.

(in PLN thousand)
5.9 Equity management

The equity management process applied by Bank Pekao S.A. Group has been adopted for the following purposes:
assurance of safe operations by maintaining the balance between the capacity toundertake risk (limited by Banks equity), and the risk levels
generated,
maintenance of risk capital above the minimum stated levels in order toassure further business operations, taking into consideration the possible,
future changes in capital requirements and safeguarding the interests of shareholders,
maintenance of the preferred capital structure in order tomaintain the desired quality of risk coverage capital,
creation of value toshareholders by the best possible utilization of the Group funds.
The Bank also has in place aformalized process of capital management and monitoring, established within the scope of ICAAP procedures. The Finance
Division under the Chief Financial Officer is responsible for designing and implementing the capital management process in the Bank. The ultimate
responsibility for capital management is vested in the Management Board of the Bank, supported by the Assets, Liabilities and Risk Management Committee, which approves the capital management process.
The capital management strategy defines the objectives and general rules of the management and monitoring of Groups capital adequacy, such as
the guidelines concerning risk coverage sources, preferred structure of risk coverage capital, long-term capital targets, capital limits system, sources of
additional capital under emergency situations and the structure of capital management.
The capital adequacy of the Group is controlled by the Assets, Liabilities and Risk Management Committee and Management Board. Periodic reports on
the scale and direction of changes of the capital adequacy ratio together with indication of potential threats are prepared for the Management Board and
for the Assets, Liabilities and Risk Management Committee. The level of basic types of risks is monitored according tothe external limits of the banking
supervision and the internal limits of the Group. Analyses and evaluations of directions of business development activities are performed assessing the
compliance with capital requirements. Forecasting and monitoring of risk weighted assets, Banks equity and capital adequacy ratio constitute anintegral part of the planning and budgeting process.
The Bank also has acapital allocation process in place, which should, inter alia, guarantee the shareholders asafe and effective return on invested
capital. On one hand, the process requires capital allocations toproducts/clients/business lines, which guarantee profits adequate tothe risks taken,
while on the other hand taking into consideration the cost of capital associated with the business decisions taken. Risk-related efficiency ratios used
in the analyses of income generated compared against the risk taken and in the optimization of capital utilization for the needs of different types of
operations.
Since 1st January 2008, the Group has followed the regulations under the Basel II Agreement. The regulations referred toabove are based on three tiers
(minimum capital requirement, process of internal capital adequacy assessment, disclosure).
Regulatory capital requirements
The basic measure applied in the measurement of capital adequacy is the capital adequacy ratio. The minimum capital adequacy ratio required by law
equals to8%, both for the Bank and the Group. As at the end of December 2011, the Groups capital adequacy ratio stood at 16.98%, i.e. more than
twice as much as the minimum value required by the law.
The decline in capital adequacy ratio in December 2011 compared with December 2010 (decrease by 0.63 p.p.) was aresult of anincrease in the total
capital requirement by about 8%, in spite of the increase in equity by about 4%.
The strengthening of the Banks Groups capital base in 2011 is aconsequence of the decision passed by the Regular General Meeting of Shareholders
on the allocation of PLN 767.4 million of net profit of Bank Pekao S.A. for 2010 tothe Banks equity.
The calculations of the regulatory capital requirement as at 31.12.2011 were based on the provisions under Resolution No. 76/2010 Polish Financial
Supervision Authority (KNF) dated 10.03.2010 and Resolution No. 369/2010 KNF dated 12.10.2010 amending the resolution of KNF on the scope and
detailed procedures for determining capital requirements for specific types of risk.
As at 31.12.2011, calculations were made based on the provisions under Resolution No. 76/2010 KNF concerning the scope and rules of capital
requirements calculation related todifferent risk, dated 10.03.2010 with subsequent amendments (Dz. Urz. KNF No 2, pos.11, from 2010, No 8,
(in PLN thousand)
pos. 38 and from 2011, No 8, pos. 29, No 9, pos.32 i No 13, pos. 48). The calculations as at the end of December 2010 were based on methods
described in Resolution No. 76/2010 KNF dated 10.03.2010. and Resolution No. 369/2010 KNF dated 12.10.2010.
The Bank is using the standard method tocalculate the capital requirements related tocredit risk (in compliance with anenclosure No. 4 toResolution
No. 76/2010 KNF and Resolution No. 369/2010 KNF with subsequent amendments), whereas for the purpose of credit risk mitigation, it is using the
financial collateral comprehensive method (in accordance with Enclosure No. 17 toResolution No. 76/2010 KNF with subsequent amendments).
The table below presents the basic data concerning Groups capital adequacy as at 31 December 2011 and 31 December 2010
Capital (Tier 1)
Share capital
Supplementary capital
Reserve capital
General risk fund for unidentified risk of banking operations
Unrealized gains
Non-controlling interest
Deductions from the core capital:
Foreign exchange differences
Intangible assets
Unrealized losses from debt instruments available for sale
Unrealized losses from equity instruments available for sale
Capital exposure tofinancial institutions
Supplementary funds (Tier 2)
Unrealized gains from debt instruments available for sale
Unrealized gains from equity instruments available for sale
Deductions:
Capital exposure tofinancial institutions
Total equity
Capital adequacy ratio
31.12.2011
31.12.2010
17,570,913
262,382
9,446,515
7,215,233
1,537,850
74,477
85,467
16,819,902
262,364
9,440,965
6,577,774
1,437,850
43,897
82,877
(98,976)
(703,355)
(110,120)
(138,560)
(136,072)
(697,235)
(100,737)
(91,781)
40,442
2,390
82,391
7
(42,832)
(82,398)
17,570,913
16.98%
16,819,902
17.61%
Internal capital adequacy assessment

Toassess the internal capital adequacy of the Group, the Bank has been applying methods designed internally. In internal capital adequacy assessment,
the Bank takes the following risk types into consideration:
credit risk (including counterparty credit risk, concentration risk, country risk and residual risk),
market risk of the trading book (including interest rate risk in trading book, foreign exchange risk, risk of changes in stock prices and risk of changes
in commodity prices),
interest rate risk of the th banking book,
liquidity risk (including liquidity maturity mismatch risk, liquidity contingency risk, market liquidity risk, operational liquidity risk, refinancing risk and
liquidity risk associated with hedging deposits),
operational risk,
business risk (including strategic risk),
real estate risk,
financial investment risk,
reputation risk,
compliance risk.

(in PLN thousand)
In addition, within the scope of management of risks mentioned above elements of models and macroecnomic risks are taken into consideration.
For each risk deemed material, the Bank develops and applies adequate risk assessment and measurement methods. The Group applies the following
risk assessment methods:
qualitative assessment applied in case of risks which are difficult tomeasure or for which capital is not asufficient means tocover losses (compliance, reputation and liquidity risk),
quantitative assessment applied in case of risks which may be measured with the use of economic capital (other risk types).
Preferred methodologies of measuring quantitfied risks and determining the capital requirements are Value at Risk-based models, based on assumptions derived from Groups risk appetite (99.97% confidence level and aone-year time horizon). The models are implemented in compliance with the
guidelines of UniCredit Group and supplemented with stress tests or scenario analyses. In case of risk types for which no methodologies have been
finally developed or implemented, the Bank is using transitional methodologies (regulatory models supplemented by stress tests and scenario analyses).
The procedure starts with the calculation of economic capital, separately for each material, quantifiable risk identified by the Group. In the next step
economic capital amounts for individual risks are aggregated into one aggregated economic capital amount including the diversification effect. Taking
diversification effect into account, the total aggregated economic capital should not be greater than the sum of economic capital amounts calculated for
specific risk types.
5.10 Fair value of financial assets and liabilities

The measurement of fair value of financial instruments, for which market values from active markets are available, is based on market quotations of the
given instrument (mark-to-market).
The measurement of fair value of Over-the-counter (OTC) derivatives and of instruments with limited liquidity (i.e. for which no market quotations are
available), is made based upon the quotations of other instruments on active markets by replication thereof using anumber of valuation techniques,
including the estimation of present value of future cash flows (mark-to-model).
As at 31 December 2011 and 31 December 2010, the Group classified the financial assets and liabilities measured at fair value into the following three
categories, broken down by valuation method:
Method 1: mark-to-market, applies exclusively toquoted securities;
Method 2: mark-to-model valuation with model parameterization, based exclusively on quotations from active markets for agiven type of instrument.
The method is applied for linear and non-linear derivative instruments on interest rate and foreign exchange markets (including forward transactions
on securities and non-liquid Treasury or Central Bank securities);
Method 3: mark-to-model valuation with partial model parameterization, based upon estimated risk factors. This method is applicable in case of derivatives on inactive market (mainly options for equity or commodity market instruments), unquoted corporate or community securities, and derivatives
for which anadjustment of fair value was made by credit risk-related write-downs.
(in PLN thousand)
31.12.2011
Assets:
Derivative financial instruments, including:
Banks
Customers
Hedging instruments, including:
Banks
Customers
Securities available for sale
Liabilities:
Banks
Customers
Banks
Customers
31.12.2010
Assets:
Banks
Customers
Banks
Customers
Liabilities:
Banks
Customers
Banks
Customers
METHOD 1
METHOD 2
METHOD 3
Total
15,487,762
601,814
14,885,948
12,260,509
2,130,179
1,741,561
388,618
408,906
95,595
313,311
9,721,424
4,219,653
2,481,104
2,270,102
211,002
1,738,549
1,725,328
13,221
991,423
247,897
26,095
23,419
2,676
717,431
26,095
26,095
1,025
25,070
28,739,694
849,711
2,156,274
1,764,980
391,294
408,906
95,595
313,311
25,324,803
4,245,748
2,507,199
2,271,127
236,072
1,738,549
1,725,328
13,221
METHOD 1
METHOD 2
METHOD 3
Total
13,904,351
768,237
16,735
13,119,379
114,228
114,228
14,309,066
1,493,453
1,287,233
206,220
258,688
87,573
171,115
12,556,925
2,239,761
1,529,195
1,326,959
202,236
710,566
710,566
441,067
197,404
63,580
63,220
360
180,083
63,250
63,250
4,069
59,181
28,654,484
965,641
1,557,033
1,350,453
206,580
16,735
258,688
87,573
171,115
25,856,387
2,417,239
114,228
1,592,445
1,331,028
261,417
710,566
710,566

(in PLN thousand)
Change in fair value of financial instruments in 2011 measured by the Group at fair value according toMethod 3
Opening balance
Increases, including:
Acquisition
Derivatives transactions made in 2011
Revenues from financial instruments
recognized in the income statement
recognized in Revaluation reserves from financial instruments
Decreases, including:
Settlement/redemption
Sale
Loss on financial instruments
Closing balance
Unrealized income from financial instruments held in
portfolio until end of period, recognized in comprehensive
income statement
recognized in Interest income
recognized in Result on financial assets and liabilities held
for trading
recognized in Result on fair value hedge accounting
recognized in Revaluation reserves from financial
instruments
FINANCIAL
ASSETS HELD
FOR TRADING
ASSETS FROM
DERIVATIVES
SECURITIES
AVAILABLE
FOR SALE
LIABILITIES FROM
DERIVATIVES
197,404
22,116,453
22,114,040
2,413
2,413
(22,065,960)
(272,127)
(21,793,833)
247,897
63,580
47,636
42,470
5,166
5,166
(85,121)
(32,836)
(52,285)
(52,285)
26,095
180,083
637,236
578,911
58,325
38,656
19,669
(99,888)
(70,494)
(29,394)
717,431
63,250
54,956
46,512
8,444
8,444
(92,111)
(29,910)
(62,201)
(62,201)
26,095
2,488
(46,030)
58,002
47,931
2,347
37,660
141
(46,030)
47,931
27,103
(6,761)
Change in fair value of financial instruments in 2010 measured by the Group at fair value according toMethod 3
Opening balance
Increases, including:
Acquisition
Derivatives transactions made in 2010
Revenues from financial instruments
recognized in Revaluation reserves from financial instruments
Settlement/redemption
Sale
Loss on financial instruments
Closing balance
Unrealized income from financial instruments held in
portfolio until end of period, recognized in comprehensive
income statement
recognized in Interest income
recognized in Result on financial assets
and liabilities held for trading
recognized in Revaluation reserves from financial
instruments
FINANCIAL
ASSETS HELD
FOR TRADING
ASSETS FROM
DERIVATIVES
SECURITIES
AVAILABLE
FOR SALE
LIABILITIES FROM
DERIVATIVES
196,594
20,704,985
20,680,746
24,239
24,239
(20,704,175)
(530,884)
(20,172,354)
(937)
(937)
197,404
67,169
35,202
11,612
23,590
23,590
(38,791)
(13,412)
(25,379)
(25,379)
63,580
129,867
120,220
100,000
20,220
19,268
952
(70,004)
(21,000)
(49,004)
180,083
61,443
47,522
29,328
18,194
18,194
(45,715)
(35,582)
(10,133)
(10,133)
63,250
(62)
13,242
11,910
(16,596)
203
11,149
(265)
13,242
(16,596)
761
(in PLN thousand)
The impact of estimated parameters of measurement at fair value for which the Group applies valuation tofair value according toMethod 3 as at
31 December 2011 is insignificant.
In case of debt instruments exposed tocredit spread risk, the sensitivity of exposure tospread changes by 1 bp amounts toPLN 6.1 thousand of impact
on the income statement and PLN 487 thousand impact on equity, respectively.
In case of derivatives measured using Method 3, however, transactions are immediately closed back-to-back on the interbank market, and as such bear
no impact upon the figures presented.
The Group also holds financial instruments which are not presented at fair value in the financial statements. Fair value is defined as the amount, for
which anasset could be exchanged or aliability settled between interested and well informed but unrelated parties tothe transaction at arms length.
In case of certain groups of financial assets, recognized at the value due for payment taking impairment into consideration, fair value was assumed tobe
equal tocarrying amount. The above applies in particular tocash, cash assets, current receivables and payables and other assets and liabilities.
In the case of credits for which no quoted market values are available, the fair values presented are roughly estimated using validation techniques and
taking into consideration the assumption, that at the moment the credit is granted its fair value is equal toits carrying amount. Fair value of nonimpaired loans is equal tothe sum of future expected cash flows, discounted tothe balance sheet date. The discount rate is defined as the sum of the
appropriate market risk-free rate, increased by the credit risk margin and current sales margin (taking commission fees into consideration) for the given
credit products group. The fair value of impaired loans is defined as equal tothe sum of expected recoveries, discounted tothe relevant balance sheet
date using the market risk-free discount rate, since the average expected recovery values take the element of credit risk fully into consideration.
The fair value of central investment credits is presented on net basis, inclusive of the fair value of the NBP refinancing credit used for financing such
investments. When gross value is used, the adjustment tofair value stands at PLN 25 million in case of credits for central investments, and
PLN 23 million in case of refinancing credits (as at 31 December 2010, fair value stood at PLN 90 million for central investment credit and
PLN 83 million for refinancing credit).

(in PLN thousand)
In the case of the Groups exposures, for which no active market prices are available, the carrying amount of such investments is presented at fair value.
The Groups non controlling interests include companies associated with the financial sector, companies taken-over over as aresult of debt restructuring, as well as other companies related tothe financial sector. Equity interests in such companies are associated with the use of the financial and
banking infrastructure and payment card services, including: BIK S.A., GPW S.A. and MasterCard. The Groups exposures tothose companies depend
upon the long-term investments, and to-date the Group has no plans as tothe divestment thereof.
31.12.2011
ASSETS
Receivables from banks
Assets from derivatives
Other financial instruments recognized
at fair value through profit or loss
Loans and advances tocustomers (*)
Receivables from financial leasing
Hedging instruments
Securities held for maturity
Total
CARRYING AMOUNT
FAIR VALUE
INCREASE/DECREASE OF
FAIR VALUE
OVER CARRYING
AMOUNT
4,886,093
5,586,057
849,711
2,156,274
4,885,935
5,586,039
849,711
2,156,274
(158)
(18)
82,816,489
2,862,760
408,906
25,324,803
3,794,834
186,252
128,872,179
82,160,868
2,862,760
408,906
25,324,803
3,812,229
186,252
128,233,777
(655,621)
17,395
(638,402)
CARRYING AMOUNT
FAIR VALUE
INCREASE/DECREASE OF
FAIR VALUE
OVER CARRYING
AMOUNT
5,969,104
6,258,811
965,641
1,557,033
5,969,104
6,258,662
965,641
1,557,033
(149)
16,735
16,735
77,803,954
3,038,975
258,688
25,856,387
4,542,058
214,616
126,482,002
76,641,713
3,038,975
258,688
25,856,387
4,555,968
214,616
125,333,522
(1,162,241)
13,910
(1,148,480)
(*) Including bills of exchange eligible for rediscount at Central Bank.
31.12.2010
ASSETS
Receivables from banks
Assets from derivatives
Other financial instruments recognized
at fair value through profit or loss
Loans and advances tocustomers (*)
Hedging instruments
Securities held for maturity
Total
(*) Including bills of exchange eligible for rediscount at Central Bank.
Since no quoted market prices are available for deposits, their fair values have been roughly estimated using valuation techniques with the assumption that the fair value of adeposit at the moment of its receipt is equal toits carrying amount. The fair value of term deposits is equal tothe sum of
future expected cash flows, discounted tothe relevant balance sheet date. The cash flow discount rate is defined as the relevant market risk-free rate,
increased by the sales margin. If the carrying amount is lower than the nominal value, aterm deposit may be cancelled before maturity, and in such
case the fair value will be equal toits nominal value. In case of current deposits, fair value was assumed as equal tothe carrying amount.
(in PLN thousand)
In case of deposits received by the Group, the adjustment tofair value as at 31 December 2011 was PLN minus 7 141 thousand
(PLN plus 7 800 thousand as at 31 December 2010) for deposits from clients, and PLN minus 49 579 thousand (PLN 3 583 thousand as
at 31 December 2010) for deposits from banks.
The fair value of deposits is calculated based on contractual maturities.
In case of debt securities in issue, the adjustment tofair value as at 31 December 2011 was PLN minus 25 052 thousand (PLN minus 14 017 thousand
as at 31 December 2010).
For other financial liabilities the Group assumes that the carrying amount is similar tothe fair value.
The mark-to-model valuation of debt instruments is based on the method of discounting the future cash flows. Variable cash flows are estimated based
upon rates adopted for specific markets (depending upon issue specifications). Both the fixed and implied cash flows are discounted using zero-coupon
curves, relevant togiven markets or issuers.
6. Custody activity
Custody activities are performed by virtue of apermit, issued by the Polish Financial Supervision Authority. The Banks clients include anumber of
domestic and foreign financial institutions, banks offering custody and investment services, insurance companies, investment and pension funds, as
well as non-financial institutions. The Bank provides custody services, including, inter alia, the settlement of transactions effected on domestic and international markets, custody of client assets, maintaining securities and cash accounts, valuation of assets and services related todividend and interest
payments.
During the period in question, the Bank acquired anumber of new clients from the segment of foreign custody banks and stockbroking companies,
registered as remote members of the Warsaw Stock Exchange (GPW S.A.), for the benefit of which the Bank serves as aclearing agent. The Bank also
maintained its leading position in terms of depositary notes, by handling more than 50% of all programmes.
As of 31 December 2011 the Bank maintained 4 852 securities accounts (in comparison to4 242 securities accounts as at 31 December 2010).
7. Brokerage activity
The Group offers awide range of capital market products and services via specialized Banks organizational unit Dom Maklerski Pekao and by the
agency of Centralny Dom Maklerski Pekao S.A.
Dom Maklerski Pekao is aspecialized organizational unit of the Bank designed tosell capital market products. The objective of the entity is providing the
highest quality brokerage services. The comprehensive offering enables investors, especially the individual clients of the Bank toinvest in shares, derivatives (futures and options), bonds traded on exchanges and OTC markets. The entity intermediates also in sales of Structured Certificates of Deposit
issued by Bank Pekao S.A. and invests in securities offered in IPOs and traded on foreign exchanges. Clients are served in 650 Accepting Orders Spots
located in Bank branches throughout Poland and through remote channels of Pekao24Makler (via Internet, mobile service and by phone) fully integrated
with the Banks electronic banking platform Pekao24.
Centralny Dom Maklerski Pekao S.A. (CDM) is the largest and oldest brokerage firm on the Polish capital market. The aim of CDM is toservice investment accounts as well as financial instruments accounts. The offering enables Clients toinvest in inter alia shares, Treasury bonds, corporate bonds,
certificates, funds units, ETF and structured products. CDM grants toclients access toinvest on derivatives markets, foreign markets and OTC markets.
Clients are served in 79 Consumer Service Spots located mainly in Bank branches throughout Poland and through remote service channels of CDM24
(CDMInternet, TeleCDM, CDMMobile) fully integrated with the Banks electronic banking platform Pekao24.
The tight cooperation of Dom Maklerski Pekao and CDM on the realization of the projects conducted on the primary market and in the other areas of
market activities of both entities ensures professional and comprehensive brokerage services.

(in PLN thousand)
CDM as well as Dom Maklerski Pekao is amember of the Warsaw Stock Exchange (GPW S.A.) and adirect participant in the National Depository of
Securities (KDPW).
Both entities conform tothe Good Practices Code of Brokerage Firms guaranteeing comprehensive services in accordance with highest ethics
standards.
The financial instruments of the clients held on securities accounts or stored in aform of document
31.12.2011
Dom Maklerski Pekao

Clients financial instruments including:
Held on securities accounts
Equity securities and rights tosuch financial assets
Debt instruments and rights tosuch financial assets
Stored in aform of document
Rights tocommodities
Clients financial instruments including:
31.12.2010
Dom Maklerski Pekao

Clients financial securities including:
Clients financial securities including:
QUANTITY (pcs)
VALUE
1,030,780,951
9,462,930
3,582,447
1,342,051
4,136,091,433
1,327,822
14,227,175
1,425,210
6,608,643,331
19,430,426
QUANTITY (pcs)
VALUE
925,837,495
6,357,212
4,157,466
972,353
200,000
200
4,184,413,142
10,857,425
21,045,444
1,794,787
6,604,790,108
19,420,813
(in PLN thousand)
Customers cash on brokerage accounts
31.12.2011
Invested in debt securities issued by the State Treasury

Deposited on cash accounts in brokerage house and paid
for securities bought in IPO or on the primary market
Other customers cash
Transferred from clearing fund
Total
31.12.2010
Invested in debt securities issued by the State Treasury

Deposited on cash accounts in brokerage house and paid
for securities bought in IPO or on the primary market
Other customers cash
Transferred from clearing fund
Total
DOM MAKLERSKI
PEKAO
CENTRALNY DOM
MAKLERSKI PEKAO S.A.
214,932
579,631
17,737
232,669
95,891
675,522
DOM MAKLERSKI
PEKAO
CENTRALNY DOM
MAKLERSKI PEKAO S.A.
217,458
862,622
18,137
235,595
44,208
906,830

(in PLN thousand)
Settlements with banks conducting brokerage activities, brokerage houses and commodity brokerage houses
31.12.2011
Receivables from exchange transactions, including:

Stock Exchanges
OTC market
NewConnect
Receivables from representing other banks conducting brokerage activities
and brokerage houses on regulated securities markets
Receivables from affiliation
Receivables from automatic loans realized through
the National Depository of Securities
Total receivables
Liabilities from exchange transactions, including:
Warsaw Stock Exchange
OTC market
NewConnect
Liabilities from representing other banks conducting brokerage activities
Liabilities from affiliation
Liabilities from automatic loans realized through
Total liabilities
31.12.2010
Receivables from exchange transactions, including:

Stock Exchanges
OTC market
NewConnect
Receivables from representing other banks conducting brokerage activities
Receivables from affiliation
Receivables from automatic loans realized through
Total receivables
Liabilities from exchange transactions, including:
Warsaw Stock Exchange
OTC market
NewConnect
Liabilities from representing other banks conducting brokerage activities
Liabilities from affiliation
Liabilities from automatic loans realized through
Total liabilities
dom maklerski
pekao
centralny dom
maklerski pekao s.A.
12,074
11,636
438
38,095
37,377
718
12,074
11,570
11,296
38,095
36,839
35,647
274
1,192
11,570
36,839
dom maklerski
pekao
centralny dom
14,539
14,539
57,769
55,530
2,239
14,539
17,684
17,684
57,769
56,856
52,812
1,497
2,547
17,684
56,856
(in PLN thousand)
Settlements with National Depository of Securities (KDPW), KDPW_CCP and other stock exchange clearing houses
31.12.2011
dom maklerski
pekao
centralny dom
1,548
11,577
318
13,443
168
168
560
6,438
156
7,154
362
362
dom maklerski
pekao
centralny dom
83
11
(94)
6,147
625
(6,772)
dom maklerski
pekao
centralny dom
2,093
11,557
255
13,905
139
139
9,036
5,655
124
14,815
497
497
dom maklerski
pekao
centralny dom
29
5
(34)
5,175
531
(5,706)
Receivables from clearing fund

Receivables from margin deposits
Other receivables
Total receivables
Amounts due toclearing fund
Amounts due on margin deposits
Other liabilities
Total liabilities
Items concerning the participation in the compensation fund managed by National Depository of Securities (KDPW)
31.12.2011
Receivables from compensation fund

Prepaid expenses system maintenance fees
Deferred income benefits from system
Amounts due tocompensation fund
Net total
Settlements with National Depository of Securities (KDPW) and other stock exchange clearing houses
31.12.2010
Receivables from clearing fund

Receivables from margin deposits
Other receivables
Total receivables
Amounts due toclearing fund
Amounts due on margin deposits
Other liabilities
Total liabilities
Items concerning the participation in the compensation fund managed by National Depository of Securities (KDPW)
31.12.2010
Receivables from compensation fund

Prepaid expenses system maintenance fees
Deferred income benefits from system
Amounts due tocompensation fund
Net total

(in PLN thousand)
Settlements with entities running regulated securities markets and commodity exchanges
31.12.2011
Receivables from Warsaw Stock Exchange

Receivables from BondSpot
Total receivables
Amounts due toWarsaw Stock Exchange
Amounts due toBondSpot
Total liabilities
31.12.2010
Receivables from Warsaw Stock Exchange

Receivables from BondSpot
Total receivables
Amounts due toWarsaw Stock Exchange
Amounts due toBondSpot
Total liabilities
dom maklerski
pekao
centralny dom
176
176
650
1
651
dom maklerski
pekao
centralny dom
185
1
186
854
1
855
8. Operating segments
Segment reporting is based on the application of the management model (Model) in which the main criterion for segmentation in the Group reporting
is the classification of customers based on their profile and service model.
The Model assumes that budgeting and monitoring of results at the segments level includes all the components of income statement tothe level of
profit before income tax. This means that both income generated by activities of specific segments and operating costs associated with these activities
(both direct costs and allocated costs, in accordance with the adopted model of the allocation) are assigned todistinctive segments, as well as other
components of income statement.
The Group settles transactions between segments on anarms length basis by applying current market prices. Fund transfers between the Banks
segments namely retail, private, corporate and investment banking and Assets and Liabilities Management and other unit are based on market prices
applicable tothe funds currency and maturity, adjusted for liquidity margins.
Business segments
Reported segments of the Group include the following areas:
Retail banking full scope of banking activity offered tothe individual customers (excluding Private banking customers), small and micro enterprises
with annual turnover not exceeding PLN 10 million, as well as results of those of the Groups consolidated subsidiaries, and share in net profit of
those of the Groups associated entities accounted for using the equity method, that are assigned tothe retail banking activity,
Private banking full scope of banking activity offered towealthiest individual customers,
Corporate and Investment banking full scope of banking activity offered tothe medium and large enterprises, including activities on the inter-bank
market, investments in debt securities and other instruments as well as results of those of the Groups consolidated subsidiaries consolidated under
the full method, that are assigned tothe corporate and investment banking activities,
Assets and Liabilities Management and other covers supervision and monitoring of fund transfers, other areas centrally managed, results of
Groups subsidiaries consolidated under the full method and share in the profits of associated entities accounted under the equity method that are
not assigned toother reported segments.
(in PLN thousand)
Information on revenues of the Groups operating segments for 2011.

CORPORATE AND
INVESTMENT BANKING
External interest income

External interest expenses
Net external interest income
Internal interest income
Internal interest expenses
Total net internal interest income
Dividends and other income from equity investments
Total net interest income
Non-interest income
Operating income
Personnel expenses
Operating costs
Operating profit
Net impairment losses on financial assets
Profit before tax
Income tax expense (continuing operations)
Income tax expense (discontinued operations)
Net profit (continuing operations)
Net profit (discontinued operations)
Net profit for the period attributable
toequity holders of the Bank
RETAIL
BANKING
PRIVATE
BANKING
CONTINUED
OPERATIONS
DISCONTINUED
OPERATIONS
ASSETS AND
LIABILITIES
MANAGEMENT
AND OTHER (*)
3,287,054
(1,201,045)
2,086,009
2,190,899
(1,539,473)
651,426
62,979
2,800,414
2,057,946
4,858,360
(1,163,933)
(1,536,215)
(163,124)
(2,863,272)
1,995,088
(727)
27,918
(211,040)
(183,122)
246,865
(22,042)
224,823
41,701
34,820
76,521
(19,772)
(27,638)
(574)
(47,984)
28,537
3,887,770
(1,479,460)
2,408,310
2,449,752
(3,582,936)
(1,133,184)
1,275,126
924,566
2,199,692
(240,651)
(404,922)
(13,091)
(658,664)
1,541,028
(960)
225,066
(93,692)
131,374
131,374
32,799
164,173
(37,659)
(39,237)
(9,026)
(85,922)
78,251
(23,588)
138,875
115,287
(4,887,516)
5,144,451
256,935
17,341
389,563
43,022
432,585
(484,139)
659,931
(191,678)
(15,886)
416,699
(4,146)
7,404,220
(2,846,362)
4,557,858
80,320
4,638,178
3,093,153
7,731,331
(1,946,154)
(1,348,081)
(377,493)
(3,671,728)
4,059,603
(5,833)
(387,539)
(453)
(148,072)
(4,532)
2,657
(537,939)
(305)
1,606,517
28,084
76,722
1,468,718
(47)
73,672
745
415,955
77,115
3,592,946
(667,884)
(15,966)
2,851,390
57,706
(15,966)
57,706
2,899,414
Net profit for the period attributable tonon-controlling interest

Allocated assets
Unallocated assets
Total assets
Allocated liabilities
Unallocated liabilities
Total liabilities
GROUP TOTAL
9,682
45,678,422
536,417
91,392,451
2,894,904
(3,791,042)
59,846,910
6,050,068
56,938,572
2,416,420
(5,116,393)
136,711,152
9,878,954
146,590,106
120,135,577
26,454,529
146,590,106
(*) including intercompany transactions within the Group of Bank Pekao S.A

(in PLN thousand)
Information on revenues of the Groups operating segments for 2010.

CORPORATE AND
INVESTMENT BANKING
External interest income

External interest expenses
Net external interest income
Internal interest income
Internal interest expenses
Total net internal interest income
Dividends and other income from equity investments
Total net interest income
Non-interest income
Operating income
Personnel expenses
Operating costs
Operating profit
Net impairment losses on financial assets and off-balance
sheet commitments
Profit before tax
Income tax expense (continuing operations)
Income tax expense (discontinued operations)
Net profit (continuing operations)
Net profit (discontinued operations)
Attributable toequity holders of the Bank
RETAIL
BANKING
PRIVATE
BANKING
CONTINUED
OPERATIONS
DISCONTINUED
OPERATIONS
ASSETS AND
LIABILITIES
MANAGEMENT
AND OTHER (*)
2,847,955
(1,081,628)
1,766,327
1,843,754
(1,202,941)
640,813
59,068
2,466,208
2,015,856
4,482,064
(1,185,843)
(1,509,512)
(156,352)
(2,851,707)
1,630,357
(23,040)
30,322
(195,863)
(165,541)
222,205
(21,695)
200,510
34,969
34,351
69,320
(19,450)
(27,089)
(408)
(46,947)
22,373
3,464,879
(1,177,885)
2,286,994
1,916,987
(2,880,326)
(963,339)
1,323,655
907,868
2,231,523
(242,849)
(392,138)
(12,798)
(647,785)
1,583,738
1,109
270,779
(122,010)
148,769
148,769
47,610
196,379
(39,145)
(39,023)
(12,502)
(90,670)
105,709
(62,720)
129,845
67,125
(3,982,946)
4,104,962
122,016
17,090
206,231
32,497
238,728
(463,014)
660,618
(209,651)
(12,047)
226,681
(28,743)
6,551,215
(2,447,541)
4,103,674
76,158
4,179,832
3,038,182
7,218,014
(1,950,301)
(1,307,144)
(391,711)
(3,649,156)
3,568,858
(50,674)
(454,440)
3,034
(33,247)
(52,041)
(1,234)
(537,928)
57
1,152,934
25,407
115,453
1,667,053
354
54,022
5,392
202,096
121,256
3,101,512
(554,116)
(17,057)
2,493,374
36,965
(17,057)
36,965
2,525,234
5,105
Attributable tonon-controlling interest

Allocated assets
Unallocated assets
Total assets
Allocated liabilities
Unallocated liabilities
Total liabilities
(*) including intercompany transactions within the Group of Bank Pekao S.A.
GROUP TOTAL
40,146,221
579,498
86,014,590
3,209,276
(1,899,534)
57,627,207
5,997,669
48,970,475
2,847,921
(5,221,808)
128,050,051
6,039,835
134,089,886
110,221,464
23,868,422
134,089,886
(in PLN thousand)
Geographical segment
The operating activity of Bank Pekao S.A. Group is concentrated in Poland through the network of branches and the Groups subsidiaries and associates.
The Group also conducts activities in the following countries:
Ukraine through the subsidiary of Bank Pekao S.A.
France through the branch of Bank Pekao S.A. in Paris.
Results generated by activities of the branch of Bank Pekao S.A. in Paris were not separated because of insignificance in comparison tothe result of the
Group.
The following table presents geographical segment information for the Groups operating activity:
POLAND
UKRAINE (DISCONTINUED
OPERATIONS)
TOTAL GROUP
2,841,708
143,695,202
57,706
2,894,904
2,899,414
146,590,106
2,488,269
130,880,610
36,965
3,209,276
2,525,234
134,089,886
2011
Net profit
Segment assets
2010
Net profit
Segment assets
9. Interest income and expense

Interest income
Loans and other receivables from customers

Placements in other banks
Reverse repo transactions
Investment securities
Financial assets designated tofair value through profit or loss
Total
2011
2010
5,898,070
219,086
111,645
1,126,094
48,498
827
7,404,220
5,181,603
162,294
51,337
1,050,612
71,256
34,113
6,551,215
Interest income for 2011 includes income from impaired financial assets in the amount of PLN 250 340 thousand (in 2010 PLN 226 333 thousand).
Total amount of interest income for 2011 measured at amortized cost using the effective interest rate method, which applies tofinancial assets not
measured at fair value through profit or loss, amounted toPLN 4 193 093 thousand (in 2010 PLN 3 718 330 thousand).

(in PLN thousand)
Interest expense
Customers deposits
Other banks deposits
Repo transactions
Loans from other banks
Total
2011
2010
(2,482,728)
(49,624)
(118,648)
(133,001)
(62,361)
(2,846,362)
(2,109,110)
(59,741)
(54,061)
(147,629)
(77,000)
(2,447,541)
Total amount of interest expenses for 2011, measured at amortized cost using the effective interest rate method with reference tofinancial liabilities,
which are not valued at fair value through profit or loss amounted toPLN 2 509 340 thousand (in 2010 PLN 2 203 336 thousand).
10. Fee and commission income and expense

Customer accounts maintenance, payment orders and cash transactions

Payment cards
Loans and advances
Investment products sales intermediation
Securities operations
Custody activity
Pension and investment funds service fees
Guarantees, letters of credit and similar transactions
Other
Total
2011
2010
863,839
812,389
593,382
274,995
151,714
59,242
68,499
54,057
55,938
2,934,055
890,390
780,746
449,570
299,934
159,506
52,784
70,474
53,077
39,812
2,796,293
Payment cards
Bank drafts and transfers
Securities and derivatives operations
Accounts maintenance
Custody activity
Pension funds management charges
Acquisition services
Other
Total
2011
2010
(394,221)
(26,340)
(22,896)
(8,389)
(8,580)
(3,150)
(1,768)
(19,817)
(485,161)
(341,659)
(23,877)
(22,590)
(7,421)
(7,294)
(3,924)
(384)
(21,116)
(428,265)
(in PLN thousand)
11. Dividend income

From issuers of securities available for sale
Total
2011
2010
10,352
10,352
7,889
7,889
12. Result on financial assets and liabilities held for trading

Foreign currency exchange result
Gains (losses) on derivatives
Gains (losses) on securities
Total
2011
2010
532,772
51,757
10,582
595,111
575,218
(3,922)
12,920
584,216
In 2011, the total change in the fair value of financial instruments valued at fair value through profit or loss, determined with the use of valuation techniques (when no published quotations from active markets are available) amounted toPLN 61 971 thousand (in 2010 PLN 4 024 thousand).
13. Gains (losses) on financial assets and liabilities at fair value through profit or loss
Debt securities
Total
2011
2010
(501)
(501)
13,952
13,952

(in PLN thousand)
14. Gains (losses) on disposal

Realized gains
Loans and other financial receivables

Available for sale financial assets debt instruments
Available for sale financial assets equity instruments
Held tomaturity investments
Total
2011
2010
130
72,899
99
3,884
96
77,108
7,044
114,693
6,934
303
128,974
Realized losses
2011
2010
Loans and other financial receivables

Available for sale financial assets debt instruments
Total
(161)
(167)
(1,377)
(1,705)
(1,371)
(1,371)
Net realized profit
75,403
127,603
The change in fair value of financial assets available for sale transferred in 2011 directly toequity amounted toPLN 10 913 thousand (increase), in 2010
PLN 132 013 thousand (increase).
The change in fair value of financial assets, transferred in 2011 from equity tofinancial income amounted toPLN 72 731 thousand (profit), in 2010
PLN 114 693 thousand (profit).
15. Administrative expenses

Personnel expenses
Wages and salaries

Insurance and other charges related toemployees
Pension programs costs due define contributions
Share-based payments expense
Total
2011
2010
(1,651,197)
(281,886)
(1,491)
(11,580)
(1,946,154)
(1,661,867)
(283,095)
(1,725)
(3,614)
(1,950,301)
(in PLN thousand)

2011
2010

Taxes and charges
Bank Guarantee Fund fee
Financial supervision authority fee (KNF)
Total
(1,207,051)
(38,521)
(89,020)
(20,836)
(1,355,428)
(1,216,346)
(38,177)
(39,156)
(20,670)
(1,314,349)
Total administrative expenses
(3,301,582)
(3,264,650)
16. Net other operating income and expenses

Other operating income
Rental income and other (miscellaneous income)

Credit insurance charges
Recovery of debt collection costs
Compensation, penalty fees and fines received
Refund of administrative costs
Income from written off liabilities
Releases of impairment of litigation and other assets
Releases of provisions for liabilities
Gains on sale of other assets
Other
Total
2011
2010
44,202
27,467
22,285
9,811
7,347
1,472
2,138
2,757
5,528
52,763
175,770
36,531
28,453
14,691
6,306
7,205
2,964
6,939
508
2,807
58,020
164,424
Other operating expenses
Credit insurance costs

Customers complaints expense
Impairment of litigations receivables and other assets
Costs of litigation and claims
Compensation, penalty fees and fines paid
Losses on disposal of other assets
Other
Total
2011
2010
(29,152)
(3,611)
(8,029)
(3,859)
(1,715)
(414)
(54,925)
(101,705)
(19,236)
(6,462)
(2,543)
(4,778)
(18,210)
(182)
(46,599)
(98,010)
74,065
66,414

628
1,198,468
94,939
50,744
1,344,779
1,498
8,010
9,508
1,354,287
76,999
480
4,051,877
181,794
481
96,500
4,408,131
3,787
10,961
10,961
9,315
550
95,047
119,660
4,527,791
IMPARIMENT
CHARGES
110
5,249
5,359
231,773
3,039
222,286
1,089
226,414
OTHER (*)
(30,396)
(30,396)
(300,605)
(3,428)
(255,643)
(11,138)
(270,209)
WRITE-OFFS OF
ASSETS FROM
THE STATEMENT
OF FINANCIAL
POSITION
(333)
(2,138)
(2,471)
(807,577)
(3,652)
(667,093)
(65,168)
(69,193)
(805,106)
RELEASE OF
IMPARIMENT
CHARGES
DECREASES
(3,006)
(830)
(73)
(3,909)
(133,097)
(1,070)
(480)
(127,143)
(137)
(358)
(129,188)
OTHER (*)
891
10,961
10,961
9,650
550
75,699
97,751
4,872,572
72,516
4,422,752
200,290
123
79,140
4,774,821
CLOSING
BALANCE
(1,165)
(5,872)
(7,037)
(546,710)
3,024
(531,375)
(29,771)
18,449
(539,673)
IMPACT ON NET
RESULT (**)
(in PLN thousand)
(*) Including foreign exchange differences and transfers between positions

(**) Impairment of financial assets and off-balance sheet commitments balance includes net impairment in the amount of PLN minus 539 673 thousand, net impairment from discontinued activities in the amount of PLN minus 4 532 and proceeds from recovered bad debt in the amount of
PLN 6 266 thousand, the total is PLN minus 537 939 thousand.
Impairment of financial assets and off-balance sheet commitments

Loans and advances tobanks valued at amortized cost
Loans and advances tocustomers valued at amortized cost
Impairment of off-balance sheet commitments
Total financial assets and off-balance sheet commitments
Impairment of other assets:
Investments in subsidiaries and associates
Intangible assets
Goodwill
Other
Total impairment of other assets
Total
2011
OPENING
BALANCE
INCREASES
17. Net impairment losses on financial assets and off-balance sheet commitments

4,862
1,189,034
69,948
51,453
1,315,297
238
2,543
2,781
1,318,078
78,245
4,793
4,193,778
167,514
7,280
103,251
4,554,861
3,759
10,961
10,961
12,863
4,352
108,300
140,235
4,695,096
IMPARIMENT
CHARGES
28
187
215
130,282
5,890
480
122,191
805
464
237
130,067
OTHER (*)
(678)
(678)
(467,161)
(452,985)
(8,694)
(4,804)
(466,483)
WRITE-OFFS OF
ASSETS FROM
THE STATEMENT
OF FINANCIAL
POSITION
(2,451)
(3,706)
(6,939)
(13,096)
(782,322)
(2,742)
(660,548)
(47,751)
(58,185)
(769,226)
RELEASE OF
IMPARIMENT
CHARGES
DECREASES
(1,335)
(96)
(8,366)
(9,797)
(366,182)
(9,256)
(4,793)
(339,593)
(28)
(2,459)
(256)
(356,385)
OTHER (*)
3,787
10,961
10,961
9,315
550
95,047
119,660
4,527,791
76,999
480
4,051,877
181,794
481
96,500
4,408,131
CLOSING
BALANCE
2,213
3,706
4,396
10,315
(535,756)
(2,120)
(528,486)
(22,197)
6,732
(546,071)
IMPACT ON NET
RESULT (**)
(*) Including foreign exchange differences and transfers between positions

(**) Impairment of financial assets and off-balance sheet commitments balance includes net impairment in the amount of PLN minus 546 071 thousand and proceeds from recovered bad debt in the amount of PLN 8 143 thousand, the total is PLN minus 537 928 thousand.
Impairment of financial assets and off-balance sheet commitments

Loans and advances tobanks valued at amortized cost
Loans and advances tocustomers valued at amortized cost
Impairment of off-balance sheet commitments
Total financial assets and off-balance sheet commitments
Impairment of other assets:
Investments in subsidiaries and associates
Intangible assets
Goodwill
Other
Total impairment of other assets
Total
2010
OPENING
BALANCE
INCREASES
(in PLN thousand)

(in PLN thousand)
18. Gains (losses) on associates

Share of profit (loss) in associates
2011
2010

Central Poland Fund LLC
Total share of gains on associates
702
62,254
10,946
(3,902)
(32)
69,968
837
58,216
8,392
304
520
68,269
Total gain (loss) on associates
69,968
68,269
19. Income tax

The Capital Groups tax charge for the year 2011 amounting toPLN 683 850 thousand contains:
tax charge relating tocontinuing operations in the amount of PLN 667 884 thousand,
tax charge relating todiscontinued operations in the amount of PLN 15 966 thousand.
The below additional information notes present the Group gross profits tax charge both for continued and discontinued operations.
Reconciliation between tax calculated by applying the current tax rate toaccounting profit and the actual tax charge presented in the consolidated
income statement.

Tax charge according toapplicable tax rate at 19%
Permanent differences:
Non taxable income
Non tax deductible costs
Impact of other tax rates applied under adifferent tax jurisdiction
Impact of utilized tax losses
Tax relieves not included in the income statement
Other
Effective income tax charge on gross profit
The applied tax rate of 19% is the corporate income tax rate binding in Poland.
2011
2010
3,592,946
682,660
1,190
(23,142)
15,019
1,801
(109)
292
7,329
683,850
3,101,512
589,287
(18,114)
(47,137)
29,041
268
(580)
319
(25)
571,173
(in PLN thousand)
The basic components of income tax charge presented in the income statement and equity
2011
2010
(826,747)
(819,151)
156
(7,752)
142,897
142,897
(683,850)
(800,748)
(790,722)
(741)
(9,285)
229,575
229,575
(571,173)
9,187
15,496
9,361
11,785
(566)
(11,393)
9,187
(12,838)
(3,186)
(4)
31,524
15,496
(674,663)
(555,677)
CONSOLIDATED INCOME STATEMENT
Current income tax

Current tax charge disclosed in the income statement
Adjustments related tothe current tax from previous years
Other taxes (for example withholding tax, income tax relating toforeign branches)
Deferred income tax
Occurrence and reversal of temporary differences
Tax charge disclosed in the consolidated income statement
EQUITY
Deferred income tax

Income and costs disclosed in other comprehensive income:
revaluation of financial instruments, used as cash flows hedges
revaluation of financial assets available for sale debt securities
revaluation of financial assets available for sale with equity rights
Tax charge presented in other comprehensive income
TOTAL CHARGE
The Capital Groups deferred tax provision as at 31 December 2011 amounting toPLN 31 757 thousand contains:
deferred tax provision relating tocontinuing operations in the amount of PLN 4 437 thousand
deferred tax provision relating todiscontinued operations in the amount of PLN 27 320 thousand
The Capital Groups deferred tax asset as at 31 December 2011 amounting toPLN 888 002 thousand relates only tothe continuing operations.

X
721,981
15,937
Net deferred tax assets

Net deferred tax
127,519
328,263
106,435
356,922
92,527
15,837
2,265
172,423
1,202,191
25,209
131,793
183,114
119,559
8,193
28,279
496,147
Deferred tax expenses
Accrued expenses securities

Accrued expenses loans and deposits
Downward revaluation of financial assets
Income received tobe settled from loans and current accounts
Loan provision expenses
Personnel related provisions
Accruals
Previous year loss
Other
Gross deferred tax asset
DEFFERED TAX ASSET
Accrued income securities

Accrued income loans
Change in revaluation of financial assets
Accelerated depreciation
Investment relief
Other
Gross deferred tax liability
DEFFERED TAX LIABILITY
TOTAL
DEFERRED
TAX
694,785
15,033
127,519
296,078
106,435
356,922
92,527
15,837
2,265
172,423
1,170,006
25,209
131,793
177,221
119,559
8,193
28,279
490,254
RECOGNIZED
IN THE
INCOME
STATEMENT
OPENING BALANCE
27,196
904
32,185
32,185
5,893
5,893
IN EQUITY
X
X
142,897
(33,334)
68,431
(19,567)
35,629
(3,227)
(6,486)
4,255
27,681
73,382
6,197
(30,127)
(61,724)
2,730
(500)
13,909
(69,515)
IN THE
INCOME
STATEMENT
X
X
9,187
3,556
3,556
(5,631)
(5,631)
IN EQUITY
CHANGES RECOGNIZED
X
X
(1,883)
(8)
(2,960)
199
133
(2)
3,321
683
1,048
(316)
1,834
2,566
RECOGNIZED
IN THE
INCOME
STATEMENT
X
X
IN EQUITY
CHANGES RESULTING FROM

CHANGES IN THE SCOPE OF
CONSOLIDATION AND OTHER
CHANGES IN TEMPORARY DIFFERENCES IN 2011
888,002
31,757
94,185
400,250
86,860
389,591
89,499
9,484
6,518
203,425
1,279,812
32,454
101,666
115,759
121,973
7,693
44,022
423,567
TOTAL
DEFERRED
TAX
852,261
31,495
94,185
364,509
86,860
389,591
89,499
9,484
6,518
203,425
1,244,071
32,454
101,666
115,497
121,973
7,693
44,022
423,305
RECOGNIZED
IN THE
INCOME
STATEMENTS
35,741
262
35,741
35,741
262
262
IN EQUITY
(in PLN thousand)
CLOSING BALANCE


X
462,147
2,505
Net deferred tax assets

Net deferred tax
190
183,167
312,722
114,155
335,123
66,622
22,196
1,100
127,999
1,163,274
25,546
182,222
340,762
118,938
8,827
27,338
703,633
Deferred tax expenses
Accrued expenses securities

Accrued expenses loans and deposits
Downward revaluation of financial assets
Income received tobe settled from loans and current accounts
Loan provision expenses
Personnel related provisions
Accruals
Previous year loss
Other
Gross deferred tax asset
DEFFERED TAX ASSET
Accrued income securities

Accrued income loans
Change in revaluation of financial assets
Accelerated depreciation
Investment relief
Other
Gross deferred tax liability
DEFFERED TAX LIABILITY
TOTAL
DEFERRED
TAX
451,351
2,505
190
183,167
301,926
114,155
335,123
66,622
22,196
1,100
127,999
1,152,478
25,546
182,222
340,762
118,938
8,827
27,338
703,633
RECOGNIZED
IN THE
INCOME
STATEMENT
OPENING BALANCE
10,796
10,796
10,796
IN EQUITY
X
X
229,575
(201)
(55,648)
(6,015)
(7,689)
21,300
25,935
(6,390)
1,121
44,275
16,688
(294)
(50,429)
(163,541)
309
(634)
1,702
(212,887)
IN THE
INCOME
STATEMENT
X
X
15,496
21,389
21,389
5,893
5,893
IN EQUITY
CHANGES RECOGNIZED
X
X
1,331
11
167
(31)
499
(30)
31
44
148
839
(43)
312
(761)
(492)
RECOGNIZED
IN THE
INCOME
STATEMENT
X
X
IN EQUITY
CHANGES RESULTING FROM

CHANGES IN THE SCOPE OF
CONSOLIDATION AND OTHER
CHANGES IN TEMPORARY DIFFERENCES IN 2010
721,981
15,937
127,519
328,263
106,435
356,922
92,527
15,837
2,265
172,423
1,202,191
25,209
131,793
183,114
119,559
8,193
28,279
496,147
TOTAL
DEFERRED
TAX
694,785
15,033
127,519
296,078
106,435
356,922
92,527
15,837
2,265
172,423
1,170,006
25,209
131,793
177,221
119,559
8,193
28,279
490,254
RECOGNIZED
IN THE
INCOME
STATEMENTS
CLOSING BALANCE
27,196
904
32,185
32,185
5,893
5,893
IN EQUITY
(in PLN thousand)
Notes to financial statements (cont.)

(in PLN thousand)
As at 31 December 2011 and 31 December 2010, there were temporary differences related toinvestments in subsidiaries and associates, for which
deferred tax liability was not created as aresult of meeting the conditions of controlling the terms of temporary differences reversing and being probable that these differences will not reverse in foreseeable future.
The table below presents the amount of negative temporary differences, unrecognized tax losses, unutilized tax reliefs, in relation towhich deferred tax
asset was not recognized in the statement of financial position as well as the expiration date of temporary differences.
EXPIRATION YEAR OF TEMPORARY DIFFERENCES
2011
2012
2013
2014
2015
2016
No time limits
Total
AMOUNT OF
DIFFERENCES AS AT
31.12. 2011
AMOUNT OF
DIFFERENCES AS AT
31.12.2010
2,520
405
782
670
33,111
37,488
1,736
2,520
33,111
37,367
20. Earnings per share

Basic earnings per share
Basic earnings per share are calculated by dividing net profit of the Group by the weighted average number of the ordinary shares outstanding during
the given period.
Earnings per share
Net profit
Weighted average number of ordinary shares in the period
Earnings per share (in PLN per share)
2011
2010
2,899,414
262,367,442
11.05
2,525,234
262,352,988
9.63
Diluted earnings per share

Diluted earnings per share are calculated by dividing net profit of the Group by the weighted average number of the ordinary shares outstanding during
the given period adjusted for all potential dilution of ordinary shares.
There are diluting instruments in the Group in the form of convertible bonds based on the G-class shares issue described in Note 45. For calculation
purposes it is assumed that these instruments will be converted into shares.
Net profit
Weighted average number of ordinary shares in the period
Adjustments tothe number of shares for the purpose of calculation of diluted earnings per share
Weighted average number of ordinary shares for the purpose of calculation of diluted earnings per share
Diluted earnings per share (in PLN per share)
2011
2010
2,899,414
262,367,442
87,905
262,455,347
11.05
2,525,234
262,352,988
85,877
262,438,865
9.62
(in PLN thousand)
21. Dividend proposal

Dividends and other distributions toshareholders are recognized directly in equity. The liability for dividend payment is not recognized until the entity has
anobligation topay dividend, which is not until it is approved.
Till the date of approval of the Financial Statements, Management Board has not made any proposal regarding dividend from 2011 year profit.
22. Cash and due from Central Bank

Cash
Current account at Central Bank
Deposit
Interest
Other funds
Total
31.12.2011
31.12.2010
2,236,224
2,005,750
631,000
13,106
13
4,886,093
2,471,939
3,495,458
314
1,393
5,969,104
During the day, the Bank may use funds from the mandatory reserve account for ongoing payments pursuant toaninstruction, submitted tothe National
Bank of Poland. It must, however, ensure that the average monthly balance on such accounts comply with the requirements described in the mandatory
reserve declaration.
Funds in the mandatory reserve account bear interest in the amount of 0.9 of the rediscount rate for bills of exchange amounts as at
31 December 2011 4.75%. (As at 31 December 2010 this interest rate amounted to3.75%).
23. Loans and advances tobanks

Loans and advances tobanks by product type
Current accounts and overnight placements

Interbank placements
Loans and advances
Cash collateral
Repo transactions
Debt securities
Receivables in transit
Interest accrued
Total gross amount
Impairment provision
Total net amount
31.12.2011
31.12.2010
1,170,846
151,685
83,716
2,065,677
1,971,558
1,181
184,514
29,396
5,658,573
(72,516)
5,586,057
2,992,440
1,378,647
619,816
754,513
250,133
291,622
28,331
20,308
6,335,810
(76,999)
6,258,811

(in PLN thousand)
Loans and advances tobanks by quality
Loans and advances tobanks, including:

gross value of non impaired receivables
gross value of impaired receivables
individual impairment charges
collective impairment charges (*)
Total
31.12.2011
31.12.2010
5,577,796
80,777
(55,181)
(17,335)
5,586,057
6,252,451
83,359
(55,024)
(21,975)
6,258,811
31.12.2011
31.12.2010
4,892,755
561,176
6,436
46,718
42,495
79,597
29,396
5,658,573
(72,516)
5,586,057
5,286,714
1,347
838,225
65,962
40,758
82,496
20,308
6,335,810
(76,999)
6,258,811
(*) Including estimated impairment for losses, incurred but not reported (IBNR)
Loans and advances tobanks by contractual maturities
Loans and advances tobanks, including:

up to1 month
between 1 and 3 months
between 1 and 5 years
over 5 years
expired
Interest accrued
Total gross amount
Total net amount
Loans and advances tobanks by currencies
PLN
CHF
EUR
USD
Other currencies
Total
Changes in the level of impairments charges in 2011 and 2010 are presented in the Note 17.
31.12.2011
31.12.2010
2,311,393
24,549
2,927,817
194,926
127,372
5,586,057
1,417,026
117,204
4,366,380
174,382
183,819
6,258,811
(in PLN thousand)
24. Financial assets and liabilities held for trading

Financial assets/liabilities held for trading by product structure
31.12.2011
Securities issued by State Treasury

T- bills
T- bonds
Securities issued by banks
Total
31.12.2010

T- bills
T- bonds
Securities issued by banks
Total
ASSETS
LIABILITIES
601,813
106,729
495,084
247,898
849,711
ASSETS
LIABILITIES
768,237
100,752
667,485
197,404
965,641
114,228
114,228
114,228
ASSETS
LIABILITIES
130,632
67,993
368,520
209,065
73,501
849,711
ASSETS
LIABILITIES
959
236,845
574,172
139,139
14,526
965,641
104,280
9,948
114,228
Financial assets/liabilities held for trading by maturities

31.12.2011
Debt securities, including:

up to1 month
over 5 years
Total
31.12.2010

up to1 month
over 5 years
Total

(in PLN thousand)
25. Derivative financial instruments held for trading

Derivative financial instruments at the Group
In its operations the Group uses different financial derivatives for managing risks involved in the Groups business. The majority of derivatives at the
Group include over-the-counter contracts. Regulated stock exchange contracts (mainly futures) represent asmall part of those derivatives.
Derivative foreign exchange transactions include either the obligation or the right tobuy or sell foreign and domestic currency assets. Forward foreign
exchange transactions are based on the foreign exchange rates, specified on the transaction date for apredefined future date. These transactions are
valued using the discounted cash flow model. Cash flows are discounted according tozero-coupon yield curves, relevant for agiven market.
Foreign exchange swaps are acombination of aswap of specific currencies as at spot date and of reverse atransaction as at forward date with foreign
exchange rates specified in advance on transaction date. Transactions of such type are settled by anexchange of assets. Foreign exchange swap transactions are mostly concluded in the process of managing the Groups currency liquidity. These transactions are valued using the discounted cash flow
model. Cash flows are discounted according tozero-coupon yield curves relevant for agiven market.
Foreign exchange options with delivery are defined as contracts, where one of the parties, i.e. the option buyer, purchases from the other party, referred
toas the option writer, at aso-called premium price the right without the obligation tobuy (call option) or tosell (put option), at aspecified point of time
in the future or during aspecified time range aforeign currency amount specified in the contract at the exchange rate set during the conclusion of the
option agreement.
In case of options settled in net amounts, upon acquisition of the rights, the buyer receives anamount of money equal tothe product of notional and
difference between spot ad strike price.
Barrier option with one barrier is atype of option where exercise of the option depends on the underlying crossing or reaching agiven barrier level.
Abarrier may be reached starting from lower (UP) or from higher (DOWN) level of the underlying instrument. IN options start their lives worthless
and only become active when apredetermined knock-in barrier price is breached. OUT options start their lives active and become null and void when
acertain knock-out barrier price is breached.
Foreign exchange options are priced using the Garman-Kohlhagen valuation model (and in case of barrier and Asian options using the so-called expanded Garman-Kohlhagen model). Parameters of the model based on market quotations of plain-vanilla at-the-money options and market spreads for
out-of-the-money and in-the-money options (volatility smile) for standard maturities.
Derivatives related tointerest rates enable the Group and its customers totransfer, modify or limit interest rate risk.
In the case of Interest Rate Swaps (IRS), counterparties exchange between each other the flows of interest payments, accrued on the nominal amount
identified in the contract. These transactions are valued using the discounted cash flow model. Floating (implied) cash flows are estimated on base of
respective IRS rates. Floating and fixed cash flows are discounted by relevant zero-coupon money market rates.
Forward Rate Agreements involve both parties undertaking topay interest on apredefined nominal amount for aspecified period starting in the future
and charged according tothe interest rate determined on the day of the agreement. The parties settle the transaction on value date with the interest
difference between the FRA rate (forward rate as at transaction date) and the reference rate. These transactions are valued using the discounted cash
flow model.
Cross currency IRS involves both parties swapping capital and interest flows in different currencies in aspecified period. These transactions are valued
using the discounted cash flow model. Valuation of Basis Swap transactions (cross currency IRS with floating coupon) takes into account market quotations of basis spread (Basis swap spread).
In the case of forward transactions on securities, counterparties agree tobuy or sell specified securities on aforward date for apayment fixed on the
date of transaction. Such transactions are measured based upon the valuation of the security (mark-to-market or mark-to-model) and valuation of the
related payment (method of discounting cash flows by money market rate).
(in PLN thousand)
Interest rate options (cap/floor) are contracts where one of the parties, the option buyer, purchases from the other party, the option writer, at aso-called
premium price, the right without the obligation toborrow (cap) or lend (floor) at specified points of time in the future (independently) amounts specified in
the contract at the interest rate set during the conclusion of the option. Transactions of this type are valued using the Black-Scholes model. The model is
parameterized based upon market quotations of at-the-money options as at standard quoted maturities.
Interest rate futures transactions refer tostandardized forward contracts purchased on the stock market. Futures contracts are measured based upon
quotations available directly from stock exchanges.
Derivative financial instruments embedded in other instruments

The Group uses derivatives financial instruments embedded in complex financial instruments, i.e. such as including both aderivative and base agreement, which results in part of the cash flows of the combined instrument changing similarly tocash flows of anindependent derivative. Derivatives
embedded in other instruments cause part or all cash flows resulting from the base agreement tobe modified as per aspecific interest rate, price of
asecurity, foreign exchange rate, price index or interest rate index.
Brady bond options are derivatives embedded in balance sheet financial instruments. In this case, embedded financial instruments are closely related
tothe base contract and thus the embedded derivative does not need tobe isolated or recognized and valuated separately.
The Group has deposits and certificates of deposits on offer which include embedded derivatives. As the nature of such instrument is not strictly associated with the nature of the deposit agreement, the embedded instrument is separated and classified into the portfolio held-for-trading. The valuation of
such instrument is recognized in the income statement. Embedded instruments include simple options (plain vanilla) and exotic options for single stocks,
indices and other market indices, including interest rate indices, foreign exchange rates and their related baskets.
All embedded options are immediately closed back-to-back on the interbank market.
Currency options embedded in deposits are valued as other currency options.
Plain vanilla options (excluding currency options, currency options for baskets) embedded in deposits are valued using the extended Black-Sholes model
using statistical measure of volatility.
Exotic options, including basket options, are valued by the Monte-Carlo simulation technique assuming Geometric Brownian Motion model of risk factors. Model parameters are determined based upon statistical measures.
The Group carried out ananalysis of the portfolio of credit agreements and of regular agreements in order toisolate embedded derivatives and decided
that the agreements in question do not require isolation and separate treatment of embedded instruments.
Risk involved in financial derivatives

Market risk and credit risk are the basic types of risk, associated with derivatives.
At the beginning, financial derivatives usually have asmall market value or no market value at all. It is aconsequence of the fact that derivatives require
no initial net investments, or require avery small net investment compared toother types of contracts, which display asimilar reaction tochanging
market conditions.
Derivatives gain positive or negative value as aresult of change in specific interest rates, prices of securities, prices of commodities, currency exchange
rates, price index, credit standing or credit index or another market parameter. In case of such changes, the derivatives held become more or less
advantageous than instruments with the same residual maturities, available at that moment on the market.
Credit risk related toderivative contracts is apotential cost of concluding anew contract on the original terms and conditions if the other party tothe
original contract fails tomeet its obligations. In order toassess the potential cost of replacement the Group uses the same method as for credit risk
assessment. In order tocontrol its credit risk levels the Group performs assessments of other contract parties using the same methods as for credit
decisions.

(in PLN thousand)
The following tables present nominal amounts of financial derivatives and fair values of such derivatives. Nominal amounts of certain financial instruments are used for comparison with balance sheet instruments but need not necessarily indicate what the future cash flow amounts will be or what the
current fair value of such instruments is and therefore do not reflect the Groups credit or price risk level.
Derivatives become advantageous (turn into assets) or disadvantageous (turn into liabilities) according tofluctuations of market interest rates, indices or
foreign exchange rates against the terms and conditions thereof.
Fair value of trading derivatives
31.12.2011
Interest rate transactions

Interest Rate Swaps (IRS)
Forward Rate Agreements (FRA)
Options
Other
Foreign currency and gold transactions
Cross-Currency Interest Rate Swaps (CIRS)
Currency Forward Agreements
Currency Swaps (FXswap)
Options for currency and for gold
Transactions based on equity securities
Options
Total
31.12.2010

Options
Other
Currency Forward Agreements
Currency Swaps (FXswap)
Options for currency and for gold
Options
Total
ASSETS
LIABILITIES
1,701,579
2,818
7,096
208
1,754,943
2,743
6,578
155
9,283
166,612
132,111
111,806
54,257
90,590
507,621
65,551
24,761
2,156,274
24,761
2,507,199
ASSETS
LIABILITIES
1,177,331
2,092
7,729
727
1,388,521
1,551
7,729
376
7,851
41,156
234,921
22,567
10,792
51,446
49,193
20,993
62,659
1,557,033
61,844
1,592,445
(in PLN thousand)
Nominal value of trading derivatives

CONTRACTUAL MATURITY
31.12.2011

Options
Other
currency bought
currency sold
Currency Forward Agreements currency bought
Currency Forward Agreements currency sold
Currency Swaps (FX swap) currency bought
Currency Swaps (FX swap) currency sold
Options bought
Options sold
Options
Total
UP TO
1 MONTH
BETWEEN 1
AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN
1 AND
5 YEARS
OVER
5 YEARS
TOTAL
5,259,334
3,700,000
511,345
4,580,513
3,450,000
15,900
17,064,676
9,950,000
83,388
54,773,046
600,000
749,812
14,464,308
323,118
96,141,877
17,700,000
1,172,218
511,345
2,862,652
2,862,652
2,915,265
2,915,265
8,266,466
8,255,538
10,153,653
10,303,737
717,227
713,315
1,532,819
1,532,984
3,986,364
4,027,878
1,322,625
1,289,280
1,708,405
1,684,314
4,521,798
4,615,344
1,142,822
1,074,224
657,096
651,403
224,375
220,840
144,215
144,215
12,164,786
12,124,239
18,886,190
19,167,799
3,326,889
3,221,034
47,880,615
32,064
21,770,427
590,184
42,435,155
846,974
64,789,893
14,787,426
1,469,222
191,663,516
CONTRACTUAL MATURITY
31.12.2010

Options
Other
currency bought
currency sold
Currency Forward Agreements currency bought
Currency Forward Agreements currency sold
Currency Swaps (FX swap) currency bought
Currency Swaps (FX swap) currency sold
Options bought
Options sold
Options
Total
UP TO
1 MONTH
BETWEEN 1
AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN
1 AND
5 YEARS
OVER
5 YEARS
TOTAL
2,474,583
1,112,937
4,645,730
10,690,652
11,100,000
14,258
44,083,456
130,000
1,088,830
12,909,012
223,231
74,803,433
11,230,000
1,326,319
1,112,937
158,412
157,966
104,042
420,420
163,160
157,966
99,199
420,325
6,466,051
6,479,632
4,715,410
4,715,727
464,955
445,810
963,051
958,846
2,673,862
2,601,629
949,474
940,596
1,308,239
1,317,738
5,212,523
5,023,720
741,744
727,428
353,693
364,066
4,869
4,196
2,316
2,316
9,091,034
9,120,282
12,606,664
12,345,272
2,158,489
2,116,150
26,875,105
646,408
14,701,168
147,096
36,599,330
644,624
46,881,607
13,132,243
1,438,128
138,189,453

(in PLN thousand)
26. Other financial instruments at fair value through profit or loss

Debt securities issued by State Treasury
T-bonds
Total
31.12.2011
31.12.2010
16,735
16,735
16,735
31.12.2011
31.12.2010
505
16,230
16,735
Debt securities measured at fair value through profit or loss by maturities

Total
27. Loans and advances tocustomers

Loans and advances tocustomers by product type
Mortgage
Current accounts
Operating loans
Investment loans
Payment cards receivables
Purchased debt receivables
Other loans and advances
Debt securities
Repo transactions
Receivables in transit
Interest accrued
Total gross amount
Total net amount
31.12.2011
31.12.2010
28,977,373
11,055,328
16,310,840
19,772,867
706,358
3,134,511
9,466,792
5,681,677
1,782,916
9,287
341,192
97,239,141
(4,422,752)
92,816,389
24,826,939
9,935,550
15,177,404
16,590,854
648,657
1,783,356
8,682,153
2,579,089
1,411,577
5,225
214,803
81,855,607
(4,051,877)
77,803,730
Loans and advances tocustomers by customer type
Receivables from corporate

Receivables from individuals
Receivables from budget entities
Interest accrued
Total gross amount
Total net amount
31.12.2011
31.12.2010
49,373,710
36,759,208
10,765,031
341,192
97,239,141
(4,422,752)
92,816,389
43,386,092
31,432,488
6,822,224
214,803
81,855,607
(4,051,877)
77,803,730
(in PLN thousand)
Loans and advances tocustomers by quality
Loans and advances tocustomers, including:

gross value of non impaired receivables
gross value of impaired receivables
individual impairment charges
collective impairment charges (*)
Total
31.12.2011
31.12.2010
91,193,753
6,045,388
(1,834,506)
(2,588,246)
92,816,389
76,538,484
5,317,123
(1,751,227)
(2,300,650)
77,803,730
31.12.2011
31.12.2010
15,671,206
3,371,176
9,025,817
30,654,771
33,892,650
4,282,329
341,192
97,239,141
(4,422,752)
92,816,389
14,087,637
3,135,421
11,542,859
24,273,289
24,759,878
3,841,720
214,803
81,855,607
(4,051,877)
77,803,730
(*) Including estimated impairment for losses, incurred but not reported (IBNR)
Loans and advances tocustomers by contractual maturities
Loans and advances tocustomers, including:

up to1 month
over 5 years
Expired
Interest accrued
Total gross amount
Total net amount
Loans and advances tocustomers by currencies
PLN
CHF
EUR
USD
Other currencies
Total
31.12.2011
31.12.2010
71,711,606
6,893,039
11,388,223
2,755,554
67,967
92,816,389
60,212,560
6,655,950
9,147,050
1,719,464
68,706
77,803,730
Changes in the level of impairment charges in 2011 and 2010 are presented in the Note 17.

(in PLN thousand)
28. Receivables from finance leases

The Group conducts leasing operations through its subsidiary Pekao Leasing Sp. z o.o. The value of gross lease investments and minimum lease payments were respectively:
31.12.2011
GROSS LEASING INVESTMENT
Up toone year
Between 1 and 5 years
Over 5 years
Total
Unrealized financial revenues
Net leasing investment
Non-guarantee residual values attributed tolessor
Present value of minimum lease payments
Value of provision
Statement of financial position value
31.12.2010
1,455,137
1,826,675
152,590
3,434,402
(371,352)
3,063,050
3,063,050
(200,290)
2,862,760
GROSS LEASING INVESTMENT
Up toone year
Over 5 years
Total
Unrealized financial revenues
Net leasing investment
Non-guarantee residual values attributed tolessor
Present value of minimum lease payments
Value of provision
Statement of financial position value
1,540,358
1,883,328
156,867
3,580,553
(359,784)
3,220,769
3,220,769
(181,794)
3,038,975
PRESENT VALUE
OF MINIMUM LEASING
PAYMENTS
1,276,515
1,653,950
132,585
3,063,050
PRESENT VALUE
OF MINIMUM LEASING
PAYMENTS
1,370,977
1,715,334
134,458
3,220,769
The Group is acting as alessor in finance leases mainly for transport vehicles, machines and equipment.
Moreover, when the Capital Group is alessee in afinance lease contract among the Group entities, the inter-company transactions relating tothe
finance lease are subject toelimination in the consolidated financial statements.
(in PLN thousand)
29. Hedge accounting

As at 31 December 2011 the Group applies fair value hedge accounting and cash flow hedge accounting.
In 2011 The Group continues toapply following hedging relationships:
fair value hedge accounting for fixed-rate debt securities classified as available-for-sale hedged with interest rate swap (IRS) transactions- described
in 29.1,
cash flow hedge accounting for floating-rate financial assets and liabilities hedged with cross-currency interest rate swap (CIRS) transactions- described in 29.2,
cash flow hedge accounting for floating-rate financial assets with interest rate swap (IRS) transactions described in 29.3,
fair value hedge accounting for interest rate risk for deposits portfolio denominated in EUR hedged with cross-currency interest rate swap (CIRS)
transactions described in 29.4.
In 2011 the Group designated tohedge accounting the following new hedging relationships:
cash flow hedge accounting for floating coupon deposits portfolio denominated in EUR hedged with interest rate swap (IRS) transactions described
in 29.5,
fair value hedge accounting for fixed-rate bonds hedged with interest rate swap (IRS) transactions- described in 29.1,
cash flow hedge accounting for highly probable cash flow in USD (long position in USD for the Bank) hedged with FX-forward transactions (aseries of
FX-spot and FX-swap transactions) described in 29.6.
Fair values of hedging derivatives
31.12.2011
Fair value hedge accounting

Interest rate swaps (IRS)
Cross-currency interest rate swaps (CIRS)
Cash flow hedge accounting
FX-swaps
Total
31.12.2010

Total
ASSETS
LIABILITIES
313,312
216,267
55,438
40,156
408,906
101,931
1,343,026
77,325
1,738,549
ASSETS
LIABILITIES
171,115
147,768
56,039
31,534
258,688
407
562,391
710,566

(in PLN thousand)
Nominal values of hedging derivatives

CONTRACTS ACCORDING TO MATURITIES
31.12.2011

Fx-swaps
Total
UP TO
1 MONTH
BETWEEN 1
AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN 1
AND
5 YEARS
OVER
5 YEARS
TOTAL
462,716
173,534
1,151,631
2,367,013
879,176
2,493,523
2,540,547
50,000
50,000
1,156,186
1,156,186
500,334
2,122,570
3,259,154
2,390,460
8,224,643
14,133,747
175,000
5,361,276
6,415,452
3,115,794
15,708,489
1,156,186
25,014,539
CONTRACTS ACCORDING TO MATURITIES
31.12.2010

Total
UP TO
1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN
1 AND
5 YEARS
OVER
5 YEARS
TOTAL
1,405,516
2,396,827
277,221
1,682,737
2,396,827
1,306,169
1,306,169
100,000
100,000
367,000
5,380,311
5,747,311
1,255,000
7,937,106
12,994,449
390,000
5,911,724
6,578,945
2,112,000
20,535,310
26,726,874
Amounts recognized in profit or loss and revaluation reserves related tocash flow hedge accounting:
2011
2010
Revaluation reserves (deferral of fair value changes of hedging instruments related tothe portion recognized as
effective hedge gross value)
(24,199)
25,070
Interest income on hedging derivatives

Ineffective portion in changes in fair value of hedging transactions recognized in income statement
172,047
(4,975)
193,600
(1,994)
Changes in revaluation reserves in respect of hedging derivatives related tocash flow hedge accounting:
2011
2010
Opening balance
Deferral of fair value changes of hedging instruments related tothe portion recognized as effective hedge
Amount of the deferral of fair value changes of hedging instruments of the effective hedge removed from
revaluation reserves and presented in net profit or loss
25,070
(49,321)
(42,499)
67,220
52
349
Closing balance
(24,199)
25,070
(in PLN thousand)
Amounts recognized in profit or loss related tofair value hedge accounting:

TYPE OF GAINS/LOSSES
Gains/losses from revaluation of hedging instruments tofair value

Gains/losses from revaluation of hedged item associated with hedged risk tofair value
Net interest income of hedging instruments
2011
2010
(52,580)
36,823
(15,757)
(51,273)
(74,185)
80,986
6,801
(56,841)
29.1 Fair value hedge of fixed-coupon debt securities

Description of hedging relationship
The Group hedges aportion of the interest rate risk resulting from the fair value changes of the hedged item related tothe volatility of market swap
curves with the designated IRS transactions.
Hedged items
The hedged items are fixed-coupon debt securities classified as available for sale (AFS), denominated in PLN, EUR and USD.
Hedging derivatives
The hedging derivatives consist of IRS transactions in PLN, EUR and USD (short position in fixed-rate) for which the Group receives floating-rate payments, and pays fixed-rate.
Financial Statement presentation
The result of the change in the hedged items fair value that relates tothe hedged risk is presented in the income statement line item Result on fair
value hedge accounting. The remaining portion of the change in the hedged items fair value (resulting from spread between swap yield curve and bond
yield curve) is recognized in accordance with the accounting principles applicable toAFS (i.e. in revaluation reserve in equity). Interest accrued on AFS
bonds is presented in the net interest income.
Changes in the fair value of hedging derivatives under the fair value hedge accounting is presented in the income statement line item Fair value adjustments in hedge accounting. Interest accrued on the hedging derivatives under the fair value hedge accounting is presented in the interest income.
29.2 Cash flow hedge of floating-rate loans and floating-rate deposits

The Bank hedges aportion of the interest rate risk and the foreign currency risk resulting from the volatility of cash flows from floating-rate assets and
liabilities with the designated CIRS transactions (basis swap).
Hedged items
Cash flows from floating-rate assets and liabilities portfolio is designated as the hedged items.
Hedging derivatives
Hedging derivatives consist of aportfolio of CIRS transactions (basis swap), where the Bank pays floating-rate currency cash flows, and receives
floating-rate PLN/currency cash-flows.
The effective portion of the change in fair value of hedging derivatives is recognized in revaluation reserve in equity. The ineffective portion of the
change in fair value of hedging derivatives is recognized in the result on financial assets and liabilities held for trading. The interest on CIRS transactions
and hedged items is presented in the net interest income.
Period when the cash flow is expected
It is expected that the cash flows related tothe hedged items will occur until 9 September 2019.

(in PLN thousand)
29.3 Cash flow hedge of floating-rate loans

The Bank hedges aportion of the interest rate risk related tothe volatility of cash flows on floating-rate assets with the designated IRS transactions.
Hedged items
The hedged items consist of the cash flows from floating-rate assets.
Hedging derivatives
The hedging derivatives consist of portfolio of IRS transactions (short position in floating rate the Bank receives fixed payments and pays floating-rate).
The effective portion of the change in fair value of hedging derivatives is recognized in revaluation reserve in equity. The ineffective portion of change in
fair value hedging derivatives is recognized in the result on financial assets and liabilities held for trading. The interest from IRS transactions and hedged
items is presented in the net interest income.
It is expected that the cash flows related tothe hedged items will occur until 20 November 2017.
29.4 Fair value hedge of interest rate risk for deposit portfolio
The Bank hedges the interest rate risk component of the fair value changes of the hedged item related tothe volatility of market interest rates with the
designated CIRS transactions.
Hedged items
The hedged item is aportfolio of deposits denominated in EUR with interests insensitive tointerest rate changes.
Hedging derivatives
The hedging items consist of CIRS transactions in which the Bank receives fixed-rate payments in EUR, and pays floating-rate payments in Polish Zloty.
The result of the change in the hedged items fair value that relates tothe hedged risk is presented in the income statement line item Result on fair
value hedge accounting. The remaining portion of change in the hedged items fair value is recognized as aseparate line in the liabilities. Interests from
deposits are presented in net interest income.
Changes in the fair value of hedging derivatives under the fair value hedge accounting are presented in the income statement line item Result on fair
value hedge accounting. Interest accrued on the hedging derivatives under the fair value hedge accounting is presented in net interest income.
(in PLN thousand)
29.5 Cash flow hedge of floating-rate deposits

The Bank hedges aportion of the interest rate risk related tothe volatility of cash flows on floating-rate deposits with the designated IRS transactions.
Hedged items
Cash flows from floating-rate deposits denominated in EUR are the hedged items.
Hedging derivatives
The hedging derivatives consist of portfolio of IRS transactions (short position in fix-rate the Bank receives floating-rate payments and pays fixed-rate).
The effective portion of the change in fair value of hedging derivatives is recognized in revaluation reserve in equity. The ineffective portion of change
in fair value hedging derivatives is recognized in the net result on financial assets and liabilities held for trading. The interest from IRS transactions and
hedged items is presented in net interest income.
It is expected that the cash flows related tothe hedged items will occur until 5 December 2014.
29.6 Cash flow hedge of projected inflow denominated in foreign currency

The Bank hedges the volatility of cash flows denominated in USD constituting the projected revenues from expected sales with the designated FXforward transactions. The currency risk is being hedged.
Hedged items
Projected sales revenues dependent on US-Dollar and Polish zloty exchange rates are the hedged items.
Hedging derivatives
The hedging derivatives consist of aportfolio of fx-forward transactions (fx-swap and fx-spot closing the short legs of fx-swap), in which the Bank sells
USD currency in exchange for PLN currency on 31.03.2012 at anagreed exchange rate.
The effective portion of change in hedging derivatives fair value is recognized in revaluation reserve in equity. The ineffective portion of changes in hedging derivatives fair value is recognized in the Result on financial assets and liabilities held for trading.
It is expected that the cash flows related tothe hedged items will occur until 31 March 2012.

(in PLN thousand)
30. Investment (placement) securities

Debt securities available for sale (AFS)
Equity securities available for sale (AFS)
Debt securities held tomaturity (HTM)
Total
31.12.2011
31.12.2010
25,307,265
17,538
3,794,834
29,119,637
25,841,525
14,862
4,542,058
30,398,445
Debt securities available for sale (AFS)

T-bills
T-bonds
Securities issued by Central Banks
Securities issued by business entities
Securities issued by local governments
Total
including impairment of assets
31.12.2011
31.12.2010
14,885,948
40,736
14,845,212
9,718,216
38,632
664,469
25,307,265
13,119,015
30,747
13,088,268
12,556,926
81,097
84,487
25,841,525
31.12.2011
31.12.2010
17,538
17,538
(123)
14,862
14,862
(481)
Equity securities available for sale (AFS)
Shares
Total
Debt securities held tomaturity (HTM)

T- bills
T- bonds
Securities issued by Central Banks
Securities issued by business entities
Total
31.12.2011
31.12.2010
3,119,353
154,765
2,964,588
675,481
3,794,834
4,107,554
363,828
3,743,726
434,504
4,542,058
(in PLN thousand)
Investment debt securities according tocontractual maturities

up to1 month
over 5 years
Total
31.12.2011
31.12.2010
10,393,698
183,673
3,008,959
8,404,007
7,111,762
29,102,099
13,016,367
393,079
978,778
11,168,462
4,826,897
30,383,583
31.12.2011
31.12.2010
25,856,387
281,276,903
(283,155,093)
3,539
295,050
648,185
399,832
25,324,803
17,466,202
369,777,564
(362,409,711)
(175,240)
67,621
89,731
587,801
452,419
25,856,387
4,542,058
31,596,384
(32,567,323)
7,537
24,368
191,810
3,794,834
3,807,823
20,148,442
(19,606,757)
(6,190)
58,172
140,568
4,542,058
29,119,637
30,398,445
Changes in investment (placement) securities
DEBT SECURITIES AVAILABLE FOR SALE (AFS)
Opening balance
Increases (purchase)
Decreases (sale and redemption)
Financial assets transferred into the receivables
Changes in fair value
Exchange rate differences
Accrued interest
Other changes
Closing balance
DEBT SECURITIES HELD UNTIL MATURITY (HTM)
Opening balance
Increases (purchase)
Decreases (sale and redemption)
Impairment charges
Exchange rate differences
Accrued interest
Other changes
Closing balance
Net total investment (placement) securities

(in PLN thousand)
31. Reclassification of securities

IAS 39 Financial Instruments: Recognition and Measurement and IFRS 7 Financial Instruments: Disclosures provide, under certain conditions, the possibility for reclassification of financial instruments into other categories.
In 2011 and 2010, the Group did not take advantage of this possibility.
On 1 October 2008, however, due tothe exceptional situation related tothe financial crisis, the Group applied the change introduced into IAS 39
Financial Instruments: Recognition and Measurement and IFRS 7 Financial Instruments: Disclosures, which enables, under certain circumstances, the
possibility for reclassification of financial instruments into other categories.
The tables below present the information on the reclassified financial assets
31.12.2011
Financial assets reclassified from Available for Sale assets toLoans and advances tocustomers
Financial assets reclassified from Available for Sale assets toLoans and advances tobanks
Financial assets reclassified from Held for Trading assets toHeld toMaturity assets
Total
NOMINAL
VALUE
CARRYING
AMOUNT
FAIR VALUE
409,495
563,669
973,164
415,467
645,958
1,061,425
403,022
656,906
1,059,928
31.12.2010
NOMINAL
VALUE
CARRYING
AMOUNT
Financial assets reclassified from Available for Sale assets

toLoans and advances tocustomers
792,253

toLoans and advances tobanks
Financial assets reclassified from Held for Trading assets
toHeld toMaturity assets
Total
31.12.2009
FAIR VALUE
NOMINAL
VALUE
CARRYING
AMOUNT
FAIR VALUE
805,328
783,944
1,146,993
1,166,680
1,139,803
290,500
290,857
290,780
1,274,000
1,276,846
1,276,174
563,669
643,505
641,524
563,669
628,733
599,810
1,646,422
1,739,690
1,716,248
2,984,662
3,072,259
3,015,787
CARRYING
AMOUNT
FAIR VALUE
31.12.2008
01.10.2008
NOMINAL
VALUE
CARRYING
AMOUNT
FAIR VALUE
NOMINAL
VALUE

toLoans and advances tocustomers
1,297,877
1,329,760
1,328,936
1,302,577
1,331,580
1,331,580

toLoans and advances tobanks
1,529,000
1,534,650
1,535,070
1,529,000
1,534,077
1,534,077
563,669
615,036
581,149
563,669
602,507
602,507
3,390,546
3,479,446
3,445,155
3,395,246
3,468,164
3,468,164
Financial assets reclassified from Held for Trading assets

toHeld toMaturity assets
Total
(in PLN thousand)
If the Group failed toperform the reclassification, the income and revaluation equity would have changed as follows:
31.12.2011
Financial assets reclassified from Available for Sale assets toloans and advances tocustomers
Financial assets reclassified from Available for Sale assets toloans and advances tobanks
Total
31.12.2010
Total
NET INCOME FROM

FINANCIAL INSTRUMENTS
MEASURED AT FAIR VALUE
REVALUATION RESERVE
10,376
10,376
4,746
4,746
NET INCOME FROM

FINANCIAL INSTRUMENTS
MEASURED AT FAIR VALUE
REVALUATION RESERVE
18,808
18,808
(378)
5
(373)
Net interest income on reclassified financial assets
Total
2011
2010
29,449
8,753
23,959
62,161
51,536
37,260
36,231
125,027
32. Assets held for sale and discontinued operations

According toIFRS 5 Non-current Assets Held for Sale and Discontinued Operations, the Group identified non-current assets meeting requirements of
IFRS 5 (concerning classification of non-current assets as held for sale) from the item Assets held for sale.
As at 31 December 2011, non-current assets classified as held for sale included following items classified as held for sale:
exposure in the subsidiary PJSC UniCredit Bank,
real estate, and
other property, plant and equipment owned by the Group.
Specification of assets held for sale and liabilities associated with those assets
31.12.2011
31.12.2010
2,900,717
30,858
2,931,575
3,200,087
23,440
23,458
3,246,985
999,985
999,985
1,009,074
1,009,074
ASSETS HELD FOR SALE
Assets of PJSC UniCredit Bank

Other assets
Total assets
LIABILITIES ASSOCIATED WITH ASSETS HELD FOR SALE
Liabilities of PJSC UniCredit Bank

Total liabilities

(in PLN thousand)
The Bank Pekao S.A. Group plans toconcentrate its activities on the local market and in connection with this aprocess for disposal of the whole exposure of Bank Pekao S.A. in PJSC UniCredit has been started. The exposure consists of:
shares in PJSC UniCredit Bank PLN 577 349 thousand,
loans and deposit totalling PLN 1 422 603 thousand, and
off-balance sheet commitments, including guarantees and letters of credit PLN 6 835 thousand and PLN 102 430 thousand respectively.
The disposal of the Banks investment in Ukraine will be achievable upon receiving all the necessary approvals.
The table below presents assets and liabilities of PJSC UniCredit Bank classified by the Pekao Group as assets held for sale
31.12.2011
BEFORE ELIMINATION
ELIMINATION OF INTERCOMPANY
TRANSACTIONS/CONSOLIDATION
ADJUSTMENTS
31.12.2011
AFTER ELIMINATION
42,623
830,883
350,887
1,635,670
11
3,570
20,755
10,505
2,894,904
6,036
(223)
5,813
42,623
836,919
350,887
1,635,670
11
3,570
20,755
10,282
2,900,717
1,529,478
840,112
32,087
14,743
2,416,420
(1,416,435)
(1,416,435)
113,043
840,112
32,087
14,743
999,985
31.12.2010
BEFORE ELIMINATION
ELIMINATION OF INTERCOMPANY
TRANSACTIONS/CONSOLIDATION
ADJUSTMENTS
31.12.2010
AFTER ELIMINATION
27,193
431,217
222,143
2,303,570
2,241
175,240
4,845
24,810
727
390
16,900
3,209,276
(229)
(8,737)
(223)
(9,189)
27,193
430,988
222,143
2,294,833
2,241
175,240
4,845
24,810
727
390
16,677
3,200,087
2,024,321
765,974
15,201
42,425
2,847,921
(1,838,755)
(92)
(1,838,847)
185,566
765,974
15,201
42,333
1,009,074

Intangible assets
Other assets
TOTAL ASSETS

Other liabilities
TOTAL LIABILITIES

Receivables from finance leases
Intangible assets
Income tax assets
Other assets
TOTAL ASSETS
Amounts due toother banks

Other liabilities
TOTAL LIABILITIES
(in PLN thousand)
The table below presents the income statement of discontinued operations of PJSC UniCredit Bank
Interest income
Interest expense
Net interest income
available for sale financial assets and held tomaturity investments
Operating income
Net impairment losses on financial assets and off-balance sheet commitments:
personnel expenses
Operating costs
Income tax expense
2011
2010
225,066
(93,692)
131,374
38,648
(17,309)
21,339
12,007
242
289
(47)
164,962
(4,532)
(4,532)
160,430
(76,896)
(37,659)
(39,237)
(9,026)
(836)
(86,758)
73,672
(15,966)
57,706
270,779
(122,010)
148,769
38,237
(17,060)
21,177
25,016
1,734
1,380
354
196,696
(52,041)
(52,041)
144,655
(78,168)
(39,145)
(39,023)
(12,502)
37
(90,633)
54,022
(17,057)
36,965
31.12.2011
31.12.2010
229,305
185,806
415,111
299,973
(113,828)
(30,869)
155,276
The table below presents the cash flow statement of discontinued operations of PJSC UniCredit Bank
Net cash flows from operating activities

Net cash flows from investing activities
Net cash flows from financing activities
Total

(in PLN thousand)
The changes in the balance of assets held for sale and liabilities associated with assets held for sale are presented in the table below:
Opening balance
Increases including:
assets of PJSC UniCredit Bank
transfer from investment properties
transfer from property, plant and equipment
other changes
Decreases including:
PJSC UniCredit Banks assets
transfer toproperty, plant and equipment
disposal
other changes
Closing balance
2011
2010
3,246,985
17,192
1,441
602
15,149
(332,602)
(299,370)
(8,685)
(94)
(24,453)
2,931,575
39,908
3,213,277
3,200,087
9,221
3,969
(6,200)
(83)
(1,833)
(4,284)
3,246,985
1,009,074
(9,089)
(9,089)
999,985
1,009,074
1,009,074
1,009,074
Opening balance
liabilities of PJSC UniCredit Bank
liabilities of PJSC UniCredit Bank
Closing balance
The assets disposals have been settled as follows:
Sales revenues
Net carrying amount of disposed assets (including sales cost)
Profit/loss on sale before income tax
2011
2010
780
94
686
1,846
1,854
(8)
(in PLN thousand)
33. Investments in associates and subsidiaries

Information on associated entities valued using equity method:
NAME OF ENTITY
31.12.2011 (*)
Central Poland Fund LLC (**)
Total
31.12.2010 (*)
Central Poland Fund LLC (**)
Total
CARRYING
AMOUNT OF
SHARES
ASSETS
LIABILITIES
REVENUES
NET PROFIT/
LOSS
30,902
123,068
347,619
18,748
1,021
11,064
24,606
59,670
8,058
46
5,787
109,220
452,040
42,801
(15,609)
31,515
127,250
1,404
(28)
25.00
34.44
49.00
50.00
53.19
4,960
33,911
141,095
5,345
941
186,252
48,596
111,339
344,194
16,672
1,054
11,949
20,160
64,223
7,386
58
9,446
110,871
543,926
40,589
1,217
24,573
116,553
1,674
(35)
25.00
34.44
49.00
50.00
53.19
9,162
31,402
137,186
4,643
849
183,242
% OF SHARES
(*) The data available as at the day of preparation of the Financial Statements
(**) The data given in USD as at 19.12.2011, carrying amount in PLN
All of the subsidiaries were consolidated full method as of 31 December 2011.

The change in value of investments in subsidiaries:
Opening balance
Reclassification into Subsidiary investments subject tofull method consolidation
Closing balance
2011
2010
31,374
(31,374)
32,046
(672)
31,374
The change in value of investments in associates:
Opening balance
Share in profits/losses
Dividends
Other
Closing balance
2011
2010
183,242
69,968
(67,083)
125
186,252
207,903
68,269
(92,930)
183,242

(in PLN thousand)
34. Intangible assets

Intangible assets, including:
research and development expenditures
licenses and patents
other
expenditures on intangible assets and advances toexpenditures on intangible assets
Goodwill
Total
31.12.2011
31.12.2010
648,795
19,543
476,474
3,811
148,967
54,560
703,355
642,675
23,855
415,496
4,471
198,853
54,560
697,235
Goodwill represents goodwill which has been transferred toPekao on integration with Bank BPH S.A.
This represents goodwill arising on Bank BPH S.A.s acquisition of Pierwszy Komercyjny Bank S.A. (PKBL) in Lublin and relates tothose branches of the
former PKBL which have been transferred tothe Bank in effect of the integration of the Banks. The recognized goodwill related toPKBL amounts to
PLN 51 675 thousand.
Goodwill of PLN 2 885 thousand represents goodwill that arose as aresult of Pekao Leasing i Finanse (formerly BPH Leasing) acquisition by Pekao
Leasing Holding (formerly BPH PBK Leasing S.A.).
At 31 December 2011 the Group carried out atest for PKBL and Pekao Leasing i Finanse goodwill impairment and as aresult which was not recognized
impairment of this item.
Please find below the specification of changes in the item Intangibles assets in the course of the reporting period:
2011
RESEARCH AND
DEVELOPMENT
COSTS
LICENSES AND
PATENTS
OTHER (*)
TOTAL
88,550
1,230
1,230
89,780
1,635,413
192,230
2,563
2,489
187,178
(1,440)
(1,435)
(5)
1,826,203
235,006
(34,576)
151,759
2,073
(188,408)
(13,353)
(13,353)
187,077
1,958,969
158,884
154,322
4,562
(14,793)
(1,435)
(13,358)
2,103,060
64,695
5,542
70,237
1,219,917
132,729
(1,371)
(1,546)
1,349,729
20,721
2,617
23,338
1,305,333
140,888
(1,371)
(1,546)
1,443,304
10,961
10,961
10,961
10,961
23,855
19,543
415,496
476,474
203,324
152,778
642,675
648,795
GROSS VALUE
Opening balance
acquisitions
other
transfer from investments outlays
liquidation
other
Closing balance
ACCUMULATED AMORTIZATION
Opening balance
Amortization for the period
Liquidation
Other
Closing balance
IMPAIRMENT DEDUCTIONS
Opening balance
Value changes
Closing balance
NET VALUE
Opening balance
Closing balance
(*) Item covering mainly investment outlays
(in PLN thousand)
2010
RESEARCH AND
DEVELOPMENT
COSTS
LICENSES AND
PATENTS
OTHER (*)
TOTAL
79,496
18,074
18,074
(9,020)
(9,020)
88,550
1,537,075
113,009
353
3,104
697
108,855
(14,671)
(3,245)
(11,426)
1,635,413
215,106
22,826
148,549
1,206
(126,929)
(2,926)
(844)
(2,082)
235,006
1,831,677
153,909
353
151,653
1,903
(26,617)
(13,109)
(13,508)
1,958,969
70,128
3,587
(9,020)
64,695
1,077,124
53
152,191
(3,245)
(6,206)
1,219,917
19,551
2,013
(844)
1
20,721
1,166,803
53
157,791
(13,109)
(6,205)
1,305,333
10,961
10,961
10,961
10,961
9,368
23,855
459,951
415,496
184,594
203,324
653,913
642,675
GROSS VALUE
Opening balance
increases from being consolidated for the first time
acquisitions
other
transfer from investments outlays
liquidation
other
Closing balance
ACCUMULATED AMORTIZATION
Opening balance
Amortization for the period
Liquidation
Other
Closing balance
Opening balance
Value changes
Closing balance
NET VALUE
Opening balance
Closing balance
(*) Item covering mainly investment outlays
In 2011 and in 2010 there have been no restrictions tolegal titles tointangible assets, not pledged in place as security for liabilities.

(in PLN thousand)
35. Property, plant and equipment

Non-current assets, including:
land and buildings
machinery and equipment
transport vehicles
other
Non-current assets in progress and prepayments for non-current assets in progress
Total
31.12.2011
31.12.2010
1,685,308
1,213,536
378,324
56,603
36,845
87,632
1,772,940
1,657,613
1,239,235
331,956
57,276
29,146
164,110
1,821,723
Below is presented the specification of changes in the item Property, plant and equipment in the course of the reporting period:
2011
LANDS AND
BUILDINGS
MACHINERY AND
EQUIPMENT
MEANS OF
TRANSPORTATION
OTHER
TOTAL
2,255,282
57,244
131
44,413
12,700
(28,348)
(27,446)
(643)
(259)
2,284,178
1,505,427
169,544
1,829
167,295
420
(96,661)
(96,435)
(226)
1,578,310
105,485
22,811
6,548
399
15,864
(32,401)
(31,661)
(740)
95,895
369,064
17,371
584
16,297
490
(20,766)
(20,441)
(109)
(216)
365,669
4,235,258
266,970
9,092
228,404
29,474
(178,176)
(175,983)
(752)
(1,441)
4,324,052
1,015,966
82,227
80,383
1,844
(27,632)
(24,441)
(283)
(2,908)
1,070,561
1,166,814
123,932
123,080
852
(98,141)
(95,344)
(2,797)
1,192,605
46,141
17,354
17,111
243
(25,860)
(25,081)
(779)
37,635
339,409
10,850
10,318
532
(21,883)
(20,172)
(109)
(1,602)
328,376
2,568,330
234,363
230,892
3,471
(173,516)
(165,038)
(392)
(8,086)
2,629,177
81
81
6,657
1,307
(583)
7,381
2,068
108
(519)
1,657
509
(61)
448
9,315
1,415
(1,163)
9,567
1,239,235
1,213,536
331,956
378,324
57,276
56,603
29,146
36,845
1,657,613
1,685,308
GROSS VALUE
Opening balance
acquisitions
transfer from non-current assets under construction
other
liquidation and sale
transfer tonon-current assets held for sale
other
Closing balance
ACCUMULATED DEPRECIATION
Opening balance
depreciation for the period
other
other
Closing balance
Opening balance
Increases
Decreases
Closing balance
NET VALUE
Opening balance
Closing balance
(in PLN thousand)
2010
LANDS AND
BUILDINGS
MACHINERY AND
EQUIPMENT
MEANS OF
TRANSPORTATION
OTHER
TOTAL
2,285,071
35,575
54
1,679
21,465
12,377
(65,364)
(17,754)
(31,876)
(15,734)
2,255,282
1,494,455
89,618
565
3,643
83,887
1,523
(78,646)
(57,473)
(18,228)
(2,945)
1,505,427
109,639
36,344
366
7,046
1,427
27,505
(40,498)
(37,628)
(1,804)
(1,066)
105,485
385,803
7,807
900
823
4,567
1,517
(24,546)
(10,974)
(11,152)
(2,420)
369,064
4,274,968
169,344
1,885
13,191
111,346
42,922
(209,054)
(123,829)
(63,060)
(22,165)
4,235,258
964,161
95,017
9
86,795
8,213
(43,212)
(16,673)
(23,004)
(3,535)
1,015,966
1,123,057
115,592
56
114,620
916
(71,835)
(56,821)
(12,732)
(2,282)
1,166,814
53,008
20,570
68
18,798
1,704
(27,437)
(26,286)
(433)
(718)
46,141
345,581
11,885
215
10,703
967
(18,057)
(10,942)
(5,973)
(1,142)
339,409
2,485,807
243,064
348
230,916
11,800
(160,541)
(110,722)
(42,142)
(7,677)
2,568,330
2,596
(2,515)
81
6,848
1
(192)
6,657
2,907
237
(1,076)
2,068
512
(3)
509
12,863
238
(3,786)
9,315
1,318,314
1,239,235
364,550
331,956
53,724
57,276
39,710
29,146
1,776,298
1,657,613
GROSS VALUE
Opening balance
acquisitions
transfer from non-current assets under construction
other
other
Closing balance
Opening balance
other
other
Closing balance
Opening balance
Increases
Decreases
Closing balance
NET VALUE
Opening balance
Closing balance
As at 31 December 2011, the amount of expenditures in the item property, plant and equipment under construction stood at PLN 87 372 thousand
(PLN 163 599 thousand as at 31 December 2010).
The amount of compensations received from third parties for impairment of loss of property, plant and equipment items recognized in the income statement for 2011 stood at PLN 1 207 thousand (PLN 2 979 thousand in 2010).
In 2011 and 2010 there have been no restrictions tolegal titles toproperty, plant and equipment, nor pledges in place as security for liabilities.
Contractual liabilities
As at 31 December 2011 the Group signed agreements with counterparties for the future purchase of intangible assets totaling PLN 47 551 thousand,
including PLN 46 849 thousand in 2012 and property, plant and equipment totaling PLN 16 658 thousand, including PLN 14 984 thousand in 2012
(as at 31 December 2010, the Group signed agreements with counterparties for the future purchase of intangible assets totaling PLN 53 827 thousand
including PLN 53 827 thousand in 2011 and property, plant and equipment totaling PLN 20 165 thousand including PLN 15 408 thousand in 2011).

(in PLN thousand)
36. Investment property

The Group values investment property using the historical cost model.
The rights tosell the investment property and the rights totransfer related revenues and profits are not asubject tolimitations.
Specification of changes in the item Investment property during the reporting period:
2011
2010
103,151
5,422
95
5,327
(2,572)
(2,572)
106,001
114,082
17,335
331
16,929
75
(28,266)
(16,135)
(12,131)
103,151
38,108
4,859
2,657
2,202
(1,444)
(1,131)
(313)
41,523
44,491
7,898
2,766
5,109
23
(14,281)
(6,187)
(8,094)
38,108
550
550
4,352
(3,802)
(96)
(3,706)
550
64,493
63,928
65,239
64,493
GROSS VALUE
Opening balance
acquisitions
transfer from property plant and equipment
other
other
Closing balance
Opening balance
transfer from property plant and equipment
other
other
Closing balance
Opening balance
foreign currency exchange differences
other
Closing balance
NET VALUE
Opening balance
Closing balance
The fair value of investment property as at 31 December 2011 stood at PLN 114 590 thousand (PLN 109 458 thousand as at 31 December 2010). Fair
value was made on the assessment of aproperty surveyor holding arecognized and relevant professional qualification.
The following amounts of revenues and costs associated with investment real properties have been recognized in the income statement:
Rental revenues from investment properties

Direct operating expenses associated with investment properties (including repair and maintenance costs)
which generated rental revenues during the reporting period
Direct operating expenses associated with investment properties (including repair and maintenance costs)
which did not generate rental revenues during the reporting period
2011
2010
4,451
4,214
(1,238)
(1,168)
(108)
(317)
(in PLN thousand)
37. Other assets

Prepaid expenses
Perpetual usufruct rights
Accrued income
Interbank and interbranch settlements
Other debtors
Other
Total
31.12.2011
31.12.2010
125,783
38,807
47,218
176
1,144,187
6
1,356,177
44,948
16,465
35,684
54
957,011
56
1,054,218
Prepaid expenses represent expenditures, which will be amortized against income statement in the forthcoming reporting periods.
Assets for sale represent assets taken over for debts. They are presented in adebt value reduced by impairment charge, calculated as adifference
between the amount of debt and fair value of taken over assets (if lower than the amount of debt). In case of surplus between the fair value of taken over
asset and the amount of debt, the difference is recognized as aliability todebtor.
The Group disposes of the assets for sale taken over for debts. The period in which the assets should be disposed is 5 years for real estate and 3 years
for other assets for sale (the period starts from the date of assets taken over). When the period expires, the Group reclassifies the carrying value of
unsold assets for sales into appropriate category of property, plant and equipment used by the Group.

(in PLN thousand)
38. Assets pledged as collateral

As at 31 December 2011 the Group held the following financial assets pledged as collateral:
CARRYING AMOUNT
OF ASSETS USED TO PLEDGE
LIABILITIES
NOMINAL VALUE
LIABILITIES
VALUE OF LIABILITIES
SUBJECT TO PLEDGE
4,064,582
4,125,831
4,064,362
bonds, bills
588,340
560,100
bonds, bills
7,000,503
6,944,847
802,591
816,480
625,476
1,258,233
1,274,793
641,305
CARRYING AMOUNT
LIABILITIES
NOMINAL VALUE
LIABILITIES
VALUE OF LIABILITIES
SUBJECT TO PLEDGE
1,566,924
1,556,653
1,570,824
bonds, bills
398,042
380,060
bonds, bills
6,656,255
6,737,060
630,869
668,427
470,572
1,089,955
1,101,285
439,359
220,356
239,609
96,605
TYPE OF TRANSACTION
PLEDGE INSTRUMENT
Sell-buy-back
Coverage of Fund for protection of
guaranteed assets tothe benefit of the
Bank Guarantee Fund
Lombard and technical loan
bonds
Other loans
bonds,
leases encumbrances
Issue of mortgage bonds
receivables backed by
mortgage, bonds and hedging
instruments
Derivatives
bonds
As at 31 December 2010 the Group held financial assets pledged as collateral:
TYPE OF TRANSACTION
PLEDGE INSTRUMENT
Sell-buy-back
Coverage of Fund for protection of
guaranteed assets tothe benefit of the
Bank Guarantee Fund
Lombard and technical loan
bonds
Other loans
Issue of mortgage bonds
Derivatives
bonds,
leases encumbrances
receivables backed by
mortgage, bonds and hedging
instruments
bonds
The freeze on securities is aconsequence of:

in case of Repo and Sell-buy-back transactions binding money market standards for such transactions,
in case of freeze tothe benefit of BFG binding provisions of the Law on Banking Guaranty Fund BFG,
in case of Lombard and technical credits policy and standards, applied by the National Bank of Poland NBP,
in case of Other loans and Derivatives terms and conditions of the agreement, entered between Bank Pekao S.A. and its clients,
in case of Issue of mortgage bonds binding provisions of the Law on Mortgage Bonds and Mortgage Banks.
(in PLN thousand)
39. Amounts due toCentral Bank

Loans received
Repo transactions
Total
31.12.2011
31.12.2010
356,386
356,386
727,979
727,979
The position covers also arefinancing credit from the National Bank of Poland granted for financing of the credit investment.
40. Amounts due toother banks

Amounts due toother banks by product type
Current accounts and overnight deposits

Deposits from other banks and other liabilities
Loans and advances received
Repo transactions
Funds in transit
Interest accrued
Total
31.12.2011
31.12.2010
618,446
312,669
2,696,512
1,882,259
24,777
9,547
5,544,210
1,796,339
1,051,612
2,708,758
1,316,102
31,281
9,031
6,913,123
Amounts due toother banks by currencies
PLN
CHF
EUR
USD
Other currencies
Total
31.12.2011
31.12.2010
2,359,627
1,084,176
1,479,521
571,919
48,967
5,544,210
3,804,164
941,414
1,815,314
79,885
272,346
6,913,123

(in PLN thousand)
41. Amounts due tocustomers

Amounts due tocustomers by product type
Amounts due tocorporate, including:

current accounts and overnight deposits
term deposits and other liabilities
interest accrued
Amounts due tobudget entities, including:
interest accrued
Amounts due toindividuals, including:
interest accrued
Repo transactions, including:
forward transactions
interest accrued
Funds in transit
Total
31.12.2011
31.12.2010
50,245,631
17,974,361
32,157,675
113,595
5,384,931
3,712,176
1,665,303
7,452
47,833,077
27,017,211
20,626,480
189,386
4,615,494
4,609,733
5,861
357,831
108,436,964
48,070,898
18,909,508
29,077,615
83,775
5,103,614
3,327,666
1,763,336
12,612
45,735,642
29,469,302
16,131,495
134,845
650,086
649,905
181
246,996
99,807,236
Amounts due tocustomers by currencies
PLN
CHF
EUR
USD
Other currencies
Total
31.12.2011
31.12.2010
89,559,995
167,308
9,075,030
8,220,227
1,414,404
108,436,964
84,794,848
122,703
9,050,655
5,323,683
515,347
99,807,236
(in PLN thousand)
42. Debt securities issued

Debt securities issued by type
Bonds
Certificates of deposit
Mortgage bonds
Interest accrued
Total
31.12.2011
31.12.2010
2
2,390,059
631,513
22,345
3,043,919
3
737,268
434,633
5,254
1,177,158
There have been no instances of default on repayment of principal or interest or redemption of its own securities by the Group.
Changes in debt securities issued
Opening balance
Increase (issuance)
Decrease (repurchase)
Decrease (partial payment)
Foreign currency exchange differences
Other changes
Closing balance
2011
2010
1,177,158
2,475,162
(589,442)
(23,554)
6,598
(2,003)
3,043,919
2,032,234
78,401
(928,639)
(30,263)
4,195
21,230
1,177,158
43. Provisions
Roll-forward of provisions in the reporting period
PROVISIONS FOR
LITIGATION AND CLAIMS
PROVISONS FOR
RETIREMENT BENEFITS
PROVISIONS FOR
UNDRAWN CREDIT
FACILITIES AND
GUARANTEES ISSUED
OTHER PROVISIONS
TOTAL
Opening balance
Provision charges/revaluation
Provision utilization
Provision releases
Foreign currency exchange
differences
42,152
7,516
(28)
(1,646)
127,852
29,434
(6)
(142)
96,500
50,744
(69,193)
39,419
19,813
(22,599)
(104)
305,923
107,507
(22,633)
(71,085)
79
1,089
401
1,569
Other changes
Closing balance
(758)
47,315
(7,157)
149,981
79,140
514
37,444
(7,401)
313,880
PROVISIONS FOR
LITIGATION AND CLAIMS
PROVISONS FOR
RETIREMENT BENEFITS
PROVISIONS FOR
UNDRAWN CREDIT
FACILITIES AND
GUARANTEES ISSUED
OTHER PROVISIONS
TOTAL
Opening balance
Provision charges/revaluation
Provision utilization
Provision releases
Foreign currency exchange
differences
16,977
30,777
(4)
(3,428)
121,022
15,689
(103)
103,251
51,453
(58,185)
13,759
60,618
(35,766)
(467)
255,009
158,537
(35,770)
(62,183)
(984)
237
(747)
Other changes
Closing balance
(1,186)
42,152
(8,756)
127,852
(256)
96,500
1,275
39,419
(8,923)
305,923
2011
2010

(in PLN thousand)
Litigation provision
Provision for litigation includes court, administrative and other legal proceedings.
Other provisions
Other provisions include in particular provisions for long term employee benefits resulting from MSR 19 and provision for employment restructuring concerning planned liquidation of the Branch in Paris. Cash flows connected with the branchs liquidation are expected tobe received until the end of 2012.
44. Other liabilities

Deferred income
Provisions for holiday leave
Provisions for other employee-related liabilities
Provisions for administrative costs
Other costs tobe paid
Other creditors
Interbank and interbranch settlements
Total
31.12.2011
31.12.2010
148,662
55,271
204,323
43,390
24,959
532,851
1,101,106
2,110,562
178,060
55,626
256,542
76,393
28,370
540,285
353,210
1,488,486
45. Share-based payment

Incentive program- management share option plan in the Bank Pekao S.A.
Options topurchase the Banks shares were granted as apart of the incentive program for senior management essential tothe success of the Banks
Group strategy. These were established by resolution of Extraordinary General Shareholders Meeting of Bank Polska Kasa Opieki S.Aon 25 July 2003.
The program involves acontingent increase of the Banks share capital by issuing the following shares received in exchange for bonds with pre-emptive
rights totake up the Banks shares.
TYPE OF SHARES
NUMBER OF SHARES
ISSUED THROUGH THE
CONDITIONAL INCREASE OF
SHARE CAPITAL
NOMINAL
VALUE OF 1
SHARE
THE ISSUE
PRICE OF ONE
SHARE
THE BASIS FOR ISSUE PRICE ESTABLISHMENT
Common bearer shares,

F-class
830,000
1PLN
108.37PLN
The average of market closing prices of the Banks shares quoted on

the Warsaw Stock Exchange for July and August 2003
Common bearer shares,

G-class
830,000
1PLN
123.06PLN
The average of market closing prices of the Banks shares quoted on

the Warsaw Stock Exchange for February and March 2004
Upon the realization of the pre-emptive rights totake up the Banks shares, the shares are recognized in the Banks equity.
On the 31st of December 2010 expired the program of F-class shares.
(in PLN thousand)
The incentive program is implemented within the subprogram based on G-class shares issue (divided into two parts each) with following parameters:
PROGRAM BASED ON G-CLASS ISSUE
Expiry date
Realization price (in PLN)
Number of options
Acquisition of rights criteria
Fair value (in PLN thousand)
Dividend rate (%)
Volatility index (%)
Risk free interest rate (%)
Expected option validity period (in years)
Weighted average of stock price (in PLN)
31.12. 2012
123.06
415,000
415,000
1. Realization of individual goals within the MBO program in 2004.

2. Remaining under contract of employment within the Banks Group on the date of option rights execution.
3. Realization of assumed ROE for 2006
3. Realization of assumed ROE for 2007
7,849
7,734
5.12
31.75
6.66
6.18
6.70
6.68
125.00
The fair value of the pre-emptive rights totake up the Banks shares amounted toPLN 28 820 thousand. It was settled over the estimated period of
acquisition of rights toBanks shares by the participants of the program.
The fair value of the pre-emptive rights totake up the Banks shares was recognized as at the day of granting the options (pre-emptive rights totake up
the Banks shares) based on the Black-Scholes model for appraisal of dividend-yielding stock options, according tothe expectations of the Management Board concerning the number of rights tobe exercised. The amount of the employee share program is adjusted as at every balance sheet date if
expectations of the Management Board concerning the number of rights tobe exercised change. No efficiency/results data except those related tothe
price of shares (market conditions) are taken into account in the assessment of transactions settled in equity instruments.
The expected effective term of the pre-emptive rights totake up the Banks shares is determined basing on the assumption that the rights will be realized steadily and the Bank does not need tospecifically define all possible exercise scenarios.
The expected volatility index reflects the assumption according tohistoric volatility index.
No other parameters related tothe granting of pre-emptive rights totake up the Banks shares were taken into account in the assessment of the fair
value.
The table below presents the number and weighted average exercise prices of shares options for each of the following Group options:
2011
Opening balance
Granted during the year
Redeemed during the year
Exercised during the year
Terminated during the year
Existing at the period-end
Executable at the period-end
2010
NUMBER OF SHARES
WEIGHTED AVERAGE
EXERCISE PRICE (*)
NUMBER OF SHARES
WEIGHTED AVERAGE
EXERCISE PRICE (*)
105,708
17,803
87,905
123.06
144.29
123.06
139,423
33,715
105,708
123.06
168.99
123.06
(*) Weighted average price of option execution on exercise dates in 2011 stood at PLN 144.29 against PLN 168.99 in 2010.

(in PLN thousand)
The UniCredit Group incentive program

The Long Term Incentive Program of the UniCredit Group constitutes anelement of the payroll policy, which helps retain and motivate key employees
essential participants for realization of mission and creates adirect bind between employee, his commitment into long term growth of the Group and
shareholders.
Under the Groups LTIP equity options and shares are granted toaselected group of employees in order to:
create incentives for realization of the strategic goals of the Group,
retain the key employees,
effectively compete in the international employment market.
The final choice of the beneficiaries of the program and the benefits granted is performed upon the following criteria:
adherence tothe corporate system of values: broad perspective, strong corporate identity and consequence,
significance of the position: strategic importance tothe business performance and corporate governance of the Group,
the need with respect of employee retention: retention within the Group of the best employees, particularly sought-after by the competition,
evaluation of the performance and potential realization of targets as well as achieved and expected results.
The fair value of share options and performance shares of UniCredit S.p.A. was estimated on basis of the Hull and White model.
The fair value of the pre-emptive rights toembrace the shares of the Banks parent entity granted until 31 December 2011 amounted to
PLN 17 878 thousand as at 31 December 2011. It is amortized over the vesting period.
The year 2011 remuneration expense increased by the amount of PLN 11 580 thousand with respect tothat (in 2010 PLN 3 614 thousand).
The table below presents changes in the number of stock options and performance shares of Bank UniCredit S.p.A., as well as the weighted average
exercise prices:
STOCK OPTIONS
PERFORMANCE SHARES
NUMBER
WEIGHTED AVERAGE
EXECUTION PRICE (*)
NUMBER
WEIGHTED AVERAGE
EXECUTION PRICE (*)
Opening balance
2,736,822
7.98/18.48/31.33
932,922
3,987,327
2,102,794
275,515
7.98/18.48/31.33
223,055
111,190
6,448,634
7.98/18.48/31.33
2,701,471
Existing at the period-end after reverse stock split (**)
270,094
2011
(*) The value of PLN 7.98 applies tothe stock options program of UniCredit S.P.A. in 2011, values PLN 18.48 and PLN 31.33 apply toprograms in 2008 and 2007 respectively.
(**) In December 2011 Bank UniCredit S.p.A. conducted areverse stock split, which resulted in the recalculation of the number of shares with ratio 10:1, rounded down tointeger.
(in PLN thousand)
STOCK OPTIONS
2010
Opening balance
PERFORMANCE SHARES
NUMBER
WEIGHTED AVERAGE
EXECUTION PRICE (*)
NUMBER
WEIGHTED AVERAGE
EXECUTION PRICE (*)
3,255,898
519,076
2,736,822
16.57/28.09
16.57/28.09
16.57/28.09
1,063,979
131,057
932,922
(*) The value of PLN 16.57 applies tothe stock options program of UniCredit S.P.A. in 2008, PLN 28.09 for 2007
46. Operating and finance leases

The Group as aLessor
In operating lease of buildings classified as investment properties the Group acts as alessor.
The amount of future minimum lease payments expected tobe received under non-cancellable operating lease can be summarized as follows:
Up toone year
Over 5 years
Total
31.12.2011
31.12.2010
14,820
18,645
6,769
40,234
18,501
16,653
10,719
45,873
The amount of the minimum operating lease payments classified as income in 2011 amounted toPLN 30 940 thousand (PLN 28 833 thousand
in 2010).
The Group as Lessee

The Group is alessee of buildings lease contracts classified as operating lease.
The amount of future minimum lease payments expected tobe paid under non-cancellable operating lease can be summarized as follows:
Up toone year
Over 5 years
Total
31.12.2011
31.12.2010
150,833
313,981
290,692
755,506
130,287
297,288
32,170
459,745
The amount of the minimum operating lease payments recognized as anexpense in 2011 amounted toPLN 234 592 thousand (expense in 2010
amounted toPLN 232 633 thousand).
The lease agreements are usually entered into for anindefinite period. In case of lease agreements concluded for anindefinite term, the minimum lease
payments are determined based upon notice of termination periods ensuing from relevant contracts. The notice period is usually fixed at 3 or 6 months.
Lease agreements are denominated in PLN as well as in foreign currencies. Payments are made in PLN, regardless of the contract currency.

(in PLN thousand)
47. Contingent liabilities

Litigation
As at 31 December 2011, there were no legal claims against the Bank and its subsidiaries, whose value accounted for at least 10% of the Groups own
funds.
In 2011 the total value of legal proceedings against the Group amounted toPLN 18 753 334 thousand (as at 31 December 2010
PLN 630 933 thousand). In 2011, the significant change in total value of litigations against the Group is aresult of the suit filed by aminority
shareholder of the Bank concerning the repeal of Annual Shareholders Meetings Resolutions No 8 and No 24 dated 19 April 2011 approving the
Consolidated Financial Statement of The Group for year 2010 and acknowledging the fulfillment of the duties in 2010 by Member of the Management
Board. The Plaintiff aminority shareholder of the Bank seeks approximately PLN 18 000 000 thousand in compensation. In the opinion of the Bank
the suit and amount in dispute are groundless.
As at 31 December 2011, the most significant claim against the Bank and Centralny Dom Maklerski Pekao S.A. was lodged by private individuals and
relates tothe alleged damage arising as aresult of shares purchased and execution process. The total amount in dispute is PLN 306 622 thousand. In
the opinion of the Group the suit and amount in dispute is groundless.
As at 31 December 2011, the Group created provisions for litigation against the Group, which according tolegal opinion are associated with arisk of
outflow of funds related tothe fulfillment of court rulings. The value of provisions, created as at 31 December 2011 amounted toPLN 47 315 thousand
(as at 31 December 2010 PLN 42 152 thousand).
Financial commitments
Financial commitments by entities
Financial commitments to:

financial entities
non financial entities
budget entities
Total
31.12.2011
31.12.2010
2,749,139
23,215,499
847,426
26,812,064
1,920,620
21,358,414
1,419,580
24,698,614
31.12.2011
31.12.2010
747,530
689,511
45,683
12,336
7,642,158
6,285,928
1,356,230
88,852
10,252
78,600
8,478,540
411,993
387,502
15,381
9,110
7,987,382
5,309,362
2,678,020
186,763
6,763
180,000
8,586,138
Guarantees
Guarantees by entities
Liabilities tofinancial entities

guarantees
sureties
confirmed export letters of credit
Liabilities tonon-financial entities
guarantees
securities underwriting guarantees
Liabilities tobudget entities
guarantees
securities underwriting guarantees
Total
(in PLN thousand)
Securities underwriting
As at 31 December 2011, the following securities programs have been in place, covered by underwriting:
NAME OF ISSUER
Client 1
Client 2
Client 3
Client 4
Client 5
Client 6
Client 7
Client 8
Client 9
Client 10
Client 11
Client 12
Client 13
TYPE OF
SECURITIES
OUTSTANDING UNDERWRITING AMOUNT TO

WHICH THE BANK HAS UNDERTAKEN TO COMMIT
CONTRACT LIFE
TYPE OF UNDERWRITING
bonds
bonds
bonds
bonds
bonds
bonds
bonds
bonds
bonds
bonds
bonds
bonds
bonds
61,540
14,550
6,640
608,000
410,900
25,200
43,180
101,970
48,000
14,500
30,600
63,750
6,000
26.03.10 30.04.12
27.10.10 30.04.12
31.05.10 28.02.12
23.07.10 30.06.15
15.11.10 31.10.13
16.12.10 30.12.17
04.04.11 31.12.12
25.08.11 30.06.13
22.08.11 31.12.13
19.08.11 30.12.13
27.09.11 31.12.12
20.12.11 30.03.13
20.12.11 31.03.13
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Securities covered by the Bank underwriting are classified as securities with unlimited marketability, unquoted on stock exchanges and are not asubject
toregulated off-the-floor trading.
As at 31 December 2010, the following securities programs have been in place, covered by underwriting:
NAME OF ISSUER
Client 1
Client 2
Client 3
Client 4
Client 5
Client 6
Client 7
TYPE OF
SECURITIES
OUTSTANDING UNDERWRITING AMOUNT TO WHICH THE

BANK HAS UNDERTAKEN TO COMMIT ITSELF
CONTRACT LIFE
TYPE OF UNDERWRITING
bonds
bonds
bonds
community,bonds
bonds
bonds
bonds
107,870
37,950
437,000
180,000
2,000,000
75,200
20,000
26.03.10 30.04.12
31.05.10 30.06.11
23.07.10 30.06.13
29.07.10 31.12.11
15.11.10 31.10.13
16.12.10 30.12.15
16.12.10 29.02.12
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Conditional
Securities covered by the Bank underwriting are classified as securities with unlimited marketability, unquoted on stock exchanges and are not asubject
toregulated off-the-floor trading.
Off- Balance Sheet financial commitments received

Financial commitments by entities:
Financial commitments from:

financial entities
budget entities
Guarantees from:
financial entities
budget entities
Total
31.12.2011
31.12.2010
3,367,501
3,367,501
12,632,187
671,580
9,181,483
2,779,124
15,999,688
3,075,878
3,075,878
12,632,481
505,460
9,390,073
2,736,948
15,708,359

(in PLN thousand)
48. Share capital

Shareholding structure
TYPE OF SHARES
NUMBER OF
SHARES
NOMINAL VALUE OF
CLASS/ISSUE
EQUITY COVERAGE
REGISTRATION
DATE
DIVIDEND RIGHTS
(FROM DATE)
A
B
C
D
E
Common bearer stock

Common bearer stock
Common bearer stock
Common bearer stock
Common bearer stock
137,650,000
7,690,000
10,630,632
9,777,571
373,644
137,650
7,690
10,631
9,777
374
fully paid-up
fully paid-up
fully paid-up
fully paid-up
fully paid-up
21.12.1997
06.10.1998
12.12.2000
12.12.2000
29.08.2003
01.01.1998
01.01.1998
01.01.2000
01.01.2000
01.01.2003
Common bearer stock
621,411
621
fully paid-up
29.08.2003
G
Common bearer stock
H
Common bearer stock
I
Common bearer stock
Total number of Shares (pcs)
515,472
359,840
94,763,559
262,382,129
515
360
94,764
fully paid-up
fully paid-up
fully paid-up
29.08.2003
12.08.2004
29.11.2007
CLASS/ISSUE
Total share capital in PLN thousand
19.05.2006
16.05.2007
15.05.2008
01.01.2004
01.01.2008
262,382
Nominal value per share = PLN 1.00
Change in the number of shares in 2011 (pcs):
Opening balance
Issue of G- Class shares (realization of the Banks program of management share option plan)
Closing balance
ISSUED AND FULLY

PAID-UP SHARES
TOTAL
262,364,326
17,803
262,382,129
262,364,326
17,803
262,382,129
Change in the number of shares in 2010 (pcs):
Opening balance
Issue of G- Class shares (realization of the Banks program of management share option plan)
Closing balance
ISSUED AND FULLY

PAID-UP SHARES
TOTAL
262,330,611
33,715
262,364,326
262,330,611
33,715
262,364,326
(in PLN thousand)
49. Other capital and reserves, retained earnings and current year profit
Reserve capital, including:
issue of shares above face value
other
Revaluation reserve, including:
revaluation of financial assets portfolio available for sale
deferred tax
revaluation of financial hedging instruments portfolio
deferred tax
General Banking Risk Fund
Other reserve capital
Bonds convertible into shares- equity component
Provision for the parent entitys shares repurchase liabilities equity component
Total other capital
Profit (loss) from previous periods, allocated toBanks shareholders
Net profit for the period, allocated toBanks shareholders
Total
31.12.2011
31.12.2010
9,446,516
9,126,501
320,015
(65,432)
(56,580)
10,750
(24,200)
4,598
1,537,850
7,168,185
(98,976)
39,517
7,531
18,035,191
74,476
2,899,414
21,009,081
9,440,966
9,124,344
316,622
22,099
2,034
(242)
25,070
(4,763)
1,437,850
6,540,418
(136,072)
35,165
2,191
17,342,617
43,897
2,525,234
19,911,748
From 1982 to1984 and from 1988 to1996, the Group operated in ahyperinflationary economic environment. IAS 29 (Financial Reporting in Hyperinflationary Economies) requires restatement of each component of owners equity (except for retained earnings and revaluation surplus) by applying ageneral price index for the period of hyperinflation. This retrospective application would have resulted in anincrease in share capital and other reserves and
adecrease in retained earnings in equivalent amounts. This restatement would not have any effect on the total amount of the Groups equity.
50. Additional information tothe consolidated cash flow statement

Cash and cash equivalents
Cash and amounts due from Central Bank

Loans and receivables from banks with maturity up to3 months
Cash and Cash equivalents presented in the cash flow statement
31.12.2011
31.12.2010
4,886,093
5,269,444
10,155,537
5,969,104
5,161,372
11,130,476
Restricted availability cash and cash equivalents as at 31 December 2011 amounted toPLN 3 469 124 thousand (PLN 3 395 080 as at
31 December 2010).

(in PLN thousand)
51. Related party transactions

The credit granting process applicable tothe Banks management and entities related tothe Bank
According tothe Banking Law, credit transactions with Members of the Bank Management Board and Supervisory Board, persons holding managerial
positions at the Bank and with entities related financially or organizationally therewith shall be effected in compliance with the By-Laws, adopted by the
Bank Supervisory Board.
The By-Laws provide detailed decision-making procedures, applicable totransactions with such persons and entities, also defining the decision-making
levels, authorized totake decisions and their respective scopes of competence. In particular, transactions with Members of the Bank Management Board
or Supervisory Board or with anentity related therewith financially or organizationally, are subject todecisions taken by the Bank Management Board
and Supervisory Board.
Members of the Bank Management and entities related therewith financially or organizationally may take advantage of credit products offered by the
Bank on standard terms and conditions of the Bank. In particular, the Bank may not offer more advantageous credit interest rates tosuch persons or
entities.
Credit risk assessment is effected using the methodology applied by the Bank, in compliance with the clients segment and type of transaction.
In case of entities related tothe Bank, standard credit procedures are applied, with transaction-related decisions taken exclusively at level of the Bank
Head Office.
(in PLN thousand)
Related party transactions

Related party transactions as at 31 December 2011
NAME OF ENTITY
Banks parent entity

UniCredit S.p.A.
Entities of UniCredit Group exclusive of
Bank Pekao S.A. Group entities
Subsidiaries
Associates
Pioneer Pekao TFI S.A. (subsidiary of PPIM S.A.)
Total Bank Pekao S.A. Group entities
Key management Staff of the Bank
or its parent entity
Total
RECEIVABLES
FROM LOANS,
ADVANCES AND
PLACEMENTS
RECEIVABLES
FROM
REVALUATION
OF DERIVATIVES
115,267
OTHER
RECEIVABLES
LIABILITIES
FROM LOANS
AND DEPOSITS
58,584
LIABILITIES
FROM
REVALUATION
OF DERIVATIVES
OTHER
LIABILITIES
22,277
1,215,321
261,211
2,664
3,457,751
1,025,915
606
60
80
15,236
2
15,378
4,109
9,512
3,719
14,896
26,231
58,467
3
3
3,489
12,873
1,334,077
261,211
18,049
3,587,675
1,025,915
22,886

(in PLN thousand)
Receivables from loans and deposits by maturity dates
31.12.2011
CURRENT (*)
UP TO
1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN
1 AND
5 YEARS
OVER
5 YEARS
INTEREST
TOTAL
115,267
115,267
1,159,725
974
1,040
8,928
44,168
486
1,215,321
3,064
38
385
3,489
1,274,992
4,038
1,040
8,929
44,206
385
487
1,334,077
UniCredit S.p.A.
Subsidiaries
Associates
Key management Staff of the Bank or its
parent entity
Total
(*) Current receivables including Nostro and cash flow hedge accounts
Liabilities due to loans and deposits by maturity dates
31.12.2011
CURRENT (*)
UP TO
1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN
1 AND
5 YEARS
OVER
5 YEARS
INTEREST
TOTAL
58,584
58,584
998,834
485,465
21,791
633,199
705,791
609,387
3,284
3,457,751
6,959
42,769
8,030
500
209
58,467
897
8,162
3,500
200
32
82
12,873
1,065,274
536,396
33,321
633,899
705,823
609,387
3,575
3,587,675
UniCredit S.p.A.
Subsidiaries
Associates
parent entity
Total
(*) Current liabilities include Loro and current accounts of other entities
(in PLN thousand)
Related party transactions as at 31 December 2010
NAME OF ENTITY
Banks parent entity

UniCredit S.p.A.
Entities of UniCredit Group exclusive
of Bank Pekao S.A. Group entities
Subsidiaries
Property Sp. z o.o. (In liquidation)
Pekao Property S.A.
Jana Kazimierza Development Sp. z o. o.
Associates
Pioneer Pekao TFI S.A.
(subsidiary of PPIM S.A.)
Total
OTHER
RECEIVABLES
LIABILITIES
FROM LOANS
AND DEPOSITS
LIABILITIES
FROM
REVALUATION
OF DERIVATIVES
OTHER
LIABILITIES
25,428
7,897
772,535
206,642
5,433
2,876,692
555,732
344
56,512
12,995
3,227
397
5,217
816
87
694
9,376
142,422
18,200
127,644
69,507
18,203
21,149
311,029
3,693
11,562
4,404,731
206,642
23,637
3,224,711
555,732
8,241
RECEIVABLES
FROM LOANS,
ADVANCES AND
PLACEMENTS
RECEIVABLES
FROM
REVALUATION
OF DERIVATIVES
3,558,996

(in PLN thousand)
Receivables from loans and deposits by maturity dates
31.12.2010
CURRENT (*)
UP TO
1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN
1 AND
5 YEARS
OVER
5 YEARS
INTEREST
TOTAL
16,707
3,542,207
82
3,558,996
514,267
39,971
340
159,276
58,183
498
772,535
28,050
41,187
270
69,507
3,240
51
401
3,693
530,974
3,613,468
340
200,463
58,234
401
851
4,404,731
CURRENT (*)
UP TO
1 MONTH
BETWEEN
1 AND
3 MONTHS
BETWEEN
3 MONTHS
AND 1 YEAR
BETWEEN
1 AND
5 YEARS
OVER
5 YEARS
INTEREST
TOTAL
25,428
25,428
308,580
460,066
147,187
372,292
940,216
645,361
2,990
2,876,692
5,426
1,669
3,400
170,598
900
124,166
3,900
18
952
9,744
301,285
11,455
106
11,562
352,558
634,064
272,359
376,192
940,216
645,361
3,961
3,224,711
UniCredit S.p.A.
Subsidiaries
Associates
parent entity
Total
(*) Current receivables including Nostro and cash flow hedge accounts
Liabilities due toloans and deposits by maturity dates
31.12.2010
UniCredit S.p.A.
Subsidiaries
Associates
parent entity
Total
(*) Current liabilities include Loro and current accounts of other entities
(in PLN thousand)
Income and expenses from transactions with related parties for the period from 1 January 2011 to31 December 2011
NAME OF ENTITY
Banks parent entity

UniCredit S.p.A.
Associates
Total
INTEREST INCOME INTERES EXPENSE
FEE AND
COMMISSION
INCOME
FEE AND
COMMISSION
EXPENSE
DERIVATIVES
DERIVATIVES
VALUATION AND
VALUATION AND
OTHER INCOME OTHER EXPENSES
5,202
(259)
204
(4,231)
2,748
(11,794)
118,950
(87,308)
5,661
(6,184)
7,126
(124,904)
(5,372)
(4,270)
(474)
(620)
(77)
(10,813)
633
249,951
26
15
16
250,641
(63)
(63)
119
1,058
202
3
1,382
(19)
(11,485)
(11,504)
195
(533)
(12)
124,347
(98,913)
256,509
(10,478)
11,256
(148,214)
Income and expenses from transactions with related parties for the period from 1 January 2010 to31 December 2010
NAME OF ENTITY
Banks parent entity

UniCredit S.p.A.
Subsidiaries
Property Sp. z o.o. (In liquidation)
Pekao Property S.A.
Associates
Total
INTEREST INCOME INTERES EXPENSE
FEE AND
COMMISSION
INCOME
FEE AND
COMMISSION
EXPENSE
DERIVATIVES
DERIVATIVES
VALUATION AND
VALUATION AND
OTHER INCOME OTHER EXPENSES
1,728
(120)
244
(3,857)
995
(12,318)
115,380
(89,871)
10,649
(5,554)
7,113
(94,239)
1
5,218
591
(38)
(121)
(19)
(76)
(1)
3
2
5
52
4
17
1
5,811
(5,485)
(3,710)
(289)
(615)
(152)
(10,506)
551
269,570
22
19
24
270,252
(42)
(42)
84
132
150
5
388
(11)
(10,361)
(10,372)
172
(453)
123,091
(100,950)
281,151
(9,453)
8,496
(116,929)

(in PLN thousand)
Off- Balance sheet financial liabilities and guarantees as at 31.12.2011

GRANTED
NAME OF ENTITY
Banks parent entity

UniCredit S.p.A.
Entities of UniCredit Group exclusive of Bank Pekao S.A. Group entities
Associates
Key management Staff of the Bank or its parent entity
Total
RECEIVED
FINANCIAL
GUARANTEES
FINANCIAL
GUARANTEES
64,701
710,554
188,638
304,095
2,208,613
180
29
32
135
376
286
775,917
500
500
493,233
2,208,613
FINANCIAL
GUARANTEES
FINANCIAL
GUARANTEES
61,707
634,984
42,192
175,177
1,980,150
53
14,593
2
14,595
185
711,471
410
410
500
1,373
218,742
1,980,150
Off- Balance sheet financial liabilities and guarantees as at 31.12.2010

GRANTED
NAME OF ENTITY
Banks parent entity

UniCredit S.p.A.
Entities of UniCredit Group exclusive of Bank Pekao S.A. Group entities
Subsidiaries
Pekao Property S.A.
Associates
Key management Staff of the Bank or its parent entity
Total
RECEIVED
(in PLN thousand)
Remuneration of Banks Management Board and Supervisory Board Members

VALUE OF BENEFITS

Short-term employee benefits (*)
Other long-term benefits (**)
Benefits resulting from the termination of employment relationship
Share-based payments (***)
Total
Supervisory Board of the Bank
Short-term employee benefits (*)
Share-based payments (***)
Total
2011
2010
14,268
4,770
5,568
3,290
27,896
16,919
1,550
789
19,258
997
51
1,048
702
702
(*) Short-term employee benefits include: base salary, bonuses and other benefits due in next 12 months from the date of the balance sheet.
(**) The item Other long-term benefit includes: provisions for along-term motivation program and deferred bonus payments.
(***) The value of share-based payments is apart of Payroll/Employee Expenses, recognized according toIFRS 2 during the reporting period in the income statement, representing the settlement of
initial fair value of options.
Banks Management Board and Supervisory Board Members have not received any remuneration from subsidiaries and associated entities in 2011 and
2010.
Remuneration of Members of Supervisory Boards and management Boards of Group subsidiaries

VALUE OF BENEFITS
Companies Management Boards

Short-term employee benefits
Other long-term benefits
Benefits resulting from the termination of employment relationship
Share-based payments
Total
Companies Supervisory Boards
Short-term employee benefits
Total
2011
2010
18,898
638
413
19,949
15,195
236
635
283
16,349
38
38
29
29

(in PLN thousand)
52. Repo and reverse repo transactions

The Group increases its funds by sales transactions with the repurchase promise granted (repo and sell-buy back) at the same price increased by
interest.
Securities composing the balance sheet portfolio of the Group as well as securities with obligation of resale (reverse repo and buy-sell back transactions)
may be asubject torepo and sell-buy back transactions.
Securities composing the balance sheet portfolio of the Group and treated as repo and sell-buy back transactions are not derecognized from the statement of financial position due tothe fact that the Group holds all the benefits and the risk deriving from these assets.
31.12.2011

up to1 month
Total financial assets held for trading
up to1 month
from 3 to6 months
Total financial assets available for sale
Financial assets held tomaturity
from 1 to3 months
Total financial assets held tomaturity
Financial assets purchased under reverse
repo and buy-sell back
up to1 month
from 1 to3 months
Total financial assets purchased under reverse repo
and buy-sell back
Total
31.12.2010
FAIR VALUE OF
ASSETS
CARRYING AMOUNT OF
RESPECTIVE LIABILITIES
FAIR VALUE OF ASSETS
CARRYING AMOUNT OF
RESPECTIVE LIABILITIES
162,677
162,677
162,790
162,790
213,037
213,037
213,466
213,466
3,253,715
297,041
3,550,756
3,245,195
303,916
3,549,111
1,353,887
1,353,887
1,357,358
1,357,358
351,149
351,149
352,461
352,461
2,421,332
9,454
2,423,963
9,428
393,144
395,916
2,430,786
2,433,391
393,144
395,916
6,495,368
6,497,753
1,960,068
1,966,188
The Group purchases securities with the resale in the future promise granted (reverse-repo and buy-sell back) at the same price increased by interest.
Securities treated as reverse repo and buy-sell back transactions are not disclosed at the statement of financial position due tothe fact that the Group
do not holds all the advantages of risks and awareness deriving from these assets.
31.12.2011
Loans and advances from banks

up to1 month
from 1 to3 months
Total loans and advances from bank
Loans and advances from customers
up to1 month
Total loans and advances from customers
Total
31.12.2010
CARRYING AMOUNT OF
ASSETS
FAIR VALUE OF HEDGE

ASSETS
CARRYING AMOUNT OF
ASSETS
FAIR VALUE OF HEDGE

ASSETS
1,465,411
508,684
1,974,095
1,465,483
507,625
1,973,108
250,149
250,149
249,987
249,987
1,783,637
1,783,637
3,757,732
1,782,428
1,782,428
3,755,536
1,411,882
1,411,882
1,662,031
1,409,902
1,409,902
1,659,889
Financial assets subject toreverse repo and buy-sell back transactions constitute collateral accepted by the Group, which the Group has the right tosell
or pledge.
(in PLN thousand)
53. Company Social Benefits Fund (ZFS)

The Social Benefits Fund Act of 4 March 1994 with subsequent amendments introduced the requirement tocreate aCompanys Social Benefits Fund by
all employers employing over 20 employees. The Bank and Group companies employing at least 20 staff have created the ZFS Funds and are making
periodic charges tothe ZFS Funds in amounts required by the Act. The aim of the ZFS Funds is tofinance social activities in benefit of the employees
and subsidize the social premises.
The liabilities of the ZFS Funds represent the accumulated value of charges made by the Company towards the ZFS Funds decreased by the amount
of non-returnable expenditures of the ZFS Funds.
In the consolidated statement of financial position, the Group netted the ZFS Funds assets against the ZFS Funds value, due tothe fact that the assets of the ZFS Funds do not represent the assets of the Group. For this reason the amount pertaining tothe ZFS Funds in the consolidated statement
of financial position as at 31 December 2011 and 31 December 2010 was zero.
The table below presents the assets according totype and book value, the balance of the Fund and costs related toZFS:
31.12.2011
31.12.2010
Loans granted toemployees

Cash at ZFS account
ZFS assets
ZFS value
44,750
10,494
55,244
55,244
46,276
5,347
51,623
51,623
2011
2010
Deductions made toZFS during fiscal period
28,171
27,903
54. Subsequent events

There have been no significant subsequent events.
Signatures of all Management Board Members
19.03.2012
Luigi Lovaglio
President of the Management Board,

CEO
Date
Name/Surname
Position/Function
19.03.2012
Diego Biondo
Vice-President of the Management Board
Date
Name/Surname
Position/Function
19.03.2012
Marco Iannaccone
Date
Name/Surname
Position/Function
19.03.2012
Andrzej Kopyrski
Date
Name/Surname
Position/Function
19.03.2012
Grzegorz Piwowar
Date
Name/Surname
Position/Function
19.03.2012
Marian Wayski
Date
Name/Surname
Position/Function
Signature
Signature
Signature
Signature
Signature
Signature
Annexes tothe financial statements
Annex 1
New standards, interpretations and amendments topublished standards that have been approved apublished by the
European Union and effective from the date after the balance sheet date.
IFRS 7 (amendment) Financial Instruments: Disclosures
Date of application: the first financial year beginning after 30 June 2011.
Description: The amendments will allow users of financial statements toimprove their understanding of transfer transactions of financial assets (for example, securitisations), including understanding the possible effects of any risks that may remain with the entity that transferred the assets. The amendments also require additional disclosures if adisproportionate amount of transfer transactions are undertaken around the end of areporting period.
Annex 2
New standards, interpretations and amendments topublished standards that have been published by the International
Accounting Standards Board (IASB) and are awaiting approval by the European Union.
IFRS 1 (amendment) First-time Adoption of International Financial Reporting Standards
Description: The proposed amendment would replace the fixed date: 1st January 2004 as the date of adopting IFRSs for the first time with adate of
adopting IFRSs for the first time in order toprovide relief for first-time adopters of IFRSs from having toreconstruct transactions that occurred before
their date of transition toIFRSs. Moreover, the amendment would provide guidance on resumption of presentation of IFRS financial statements for entities emerging from severe hyperinflation.
IFRS 9 Financial Instruments

Date of application: the first financial year beginning after 31 December 2012.
Description: The standard is issued as part of comprehensive review of financial instruments accounting. The new standard reduces the complexity of
the current requirements and toreplace IAS 39 Financial Instruments: Recognition and Measurement. The new standard deals with classification and
measurement of financial assets only.
IAS 12 (amendment) Income Taxes

Description: The amendment would specify how the assets and provisions for deferred tax should be measured in case of investment properties measured using the fair value model in IAS 40 Investment Property.
IFRS 10 Consolidated Financial Statements

Description: The standard establishes principles for the presentation and preparation of consolidated financial statements when anentity controls one
or more other entities. The IFRS supersedes IAS 27 Consolidated and Separate Financial Statements and SIC-12 Consolidation Special Purpose Entities. The IFRS 10 defines the principle of control and establishes control as the basis for determining which entities are consolidated in the consolidated
financial statements. The IFRS also sets out the accounting requirements for the preparation of consolidated financial statements.
IFRS 11 Joint Arrangements

Description: The standard establishes more realistic principles for financial reporting by parties toajoint arrangement, and is concentrating mainly on
rights and obligations resulting from those arrangements, and not on its legal form. The standard addresses inconsistencies in financial reporting of joint
arrangements by introduction of homogenous method of accounting of interest in jointly controlled entities.
IFRS 12 Disclosure of Interests with Other Entities

Description: The standard establishes new and complex principles for disclosure of entitys interests in other entities, including subsidiaries, joint
ventures, associates and other entities that are not consolidated.
IAS 27 Separate Financial Statements

Description: The IAS 27 Separate Financial Statements establishes principles for the presentation and disclosures tobe applied in accounting for
investments in subsidiaries, associates and jointly ventures when anentity prepares separate (non-consolidated) financial statements. IAS 27 Separate
Financial Statements supersedes the previous version of IAS 27 Consolidated and Separate Financial Statements.
IAS 28 Investments in Associates and Joint Ventures

Description: The new standard refers toaccounting for investments in associates and sets out the requirements for the application of the equity method
when accounting for investments in associates and joint ventures. IAS 28 Investments in Associates and Joint Ventures will replace the previous version of IAS 28 Investments in Associates.
IFRS 13 Fair value measurement

Description: The standard establishes framework for fair value measurement and requires disclosure of information on fair value measurement. The
standard does not set out when anasset, liability or entitys own equity instruments should be measured at fair value. On opposite, measurement and
disclosure required by the standard is tobe applied when other standards permit fair value measurement (with few exceptions).
IAS 19 (amendment) Employee Benefits

Description: The amended standard helps recipients of financial statements tounderstand how the employee benefits influence the financial position of
the entity, its financial results and cash flows.
Annexes tothe financial statements (cont.)
IAS 1 (amendment) Investments in Associates and Joint Ventures

Description: The amendments toIAS 1 Presentation of Financial Statements specify the requirements for items of other comprehensive income (OCI)
tobe grouped in financial statements prepared in accordance with IFRSs.
IFRIC Interpretation 20 Stripping Costs in the Production Phase of aSurface Mine

Description: The Interpretation clarifies accounting for costs associated with the process of removing waste from asurface mine in order togain access
tomineral ore deposits.
IAS 32 (amendment) Financial Instruments: Presentation

Description: The objective of this Standard is toestablish principles for presenting financial instruments as liabilities or equity and for offsetting financial
assets and liabilities.
IFRS 7 (amendment) Financial Instruments: Disclosures

Description: The objective of this IFRS is torequire entities toprovide disclosures in their financial statements that enable users tobetter estimate the
influence or potential influence of offsetting financial assets and liabilities on financial standing of the entity.
Annex 3
Glossary
IFRS International Financial Reporting Standards the standards, interpretations and their structure adopted by the International Accounting Standards Board IASB.
IAS International Accounting Standards previous name of the standards forming part of the current IFRS.
IFRIC International Financial Reporting Interpretations Committee committee operating under the International Accounting Standards Board publishing interpretations of IFRS.
CIRS Currency Interest Rate Swap this is atransaction exchange of principal amounts and interest payments in different currencies between two
partners.
IRS Interest Rate Swap agreement between two counterparties, under which parties pay each other (at specified intervals during the contract live) of
contractual principal and interest on the contract, charged at adifferent rate.
FRA Forward Rate Agreement contract under which two counterparties agree the interest rate that will apply in the future for aspecified amount in
currency transactions for apredetermined period.
CAP cap option is the financial agreement, which limits the risks borne by lenders on avariable rate, is susceptible tothe potential for loss as aresult
of the growth rate. Cap option is aseries of call options on interest rates, in which the issuer guarantees the buyer that he will compensate the additional interest costs, which he must pay from your loan if the loan interest rate rises above the agreed interest rate.
FLOOR floor option is the financial agreement, which reduces the risk of incurring losses resulting from lower interest rates by the lender providing the
loan at avariable rate of interest. Floor option is aseries of put options on interest rates, the issuer guarantees the interest which he must pay the loan if
the interest rate on the loan falls below the agreed interest rate.
IBNR Incurred But Not Reported losses.
PD Probability Default parameter used in A-IRB method which determines the probability of debtors insolvency. PD denotes with what probability is
credit loss expected within time period of one year.
LGD Loss Given Default.
EAD Exposure At Default.
EL Expected Loss.
CCF Credit Conversion Factor.
A-IRB Advanced Internal Rating-Based approach advanced method where all parameters of risk (PD, LGD, EAD) are estimated by the bank using its
own quantitative model todetermine the amount of the risk weighted assets.
VaR Value at Risk the amount by which the market value of anasset or portfolio may be reduced based on specific, within afixed time and aspecified probability.
EaR Earnings at Risk the maximum decrease of earnings, relative tospecific goal, which might occur due toinfluence of market risk on specific risk
factors for the given time period and confidence level.
ICAAP Internal Capital Adequacy Assessment Process the process of assessing internal capital adequacy.
An umbrella covering countries

in Central and Eastern Europe
Many Austrian companies have subsidiaries in other European countries that do not always engage in
cross-border treasury operations. When new funding is needed, especially during the start-up phase
of a business, local regulations that must be addressed can often present major obstacles to success.
UniCredit has created the Umbrella Facility, a flexible and user-friendly credit facility based on the
parent companys credit rating, that can be accessed in most Central and Eastern European countries.
Bank Austria coordinates every phase of negotiation, acting as the single point of contact between the
client and UniCredits banks across the region.
A simple way to help companies focus on their business, leaving the bank to manage their financials.
Michelangelo Pistoletto - Embrace Differences - Serigraphy on Thermodeth Mirror 2005 - 2006
UniCredit Art Collection - Michelangelo Pistoletto - Courtesy Cittadellarte - Pistoletto Foundation - Details
Skonsolidowane Sprawozdanie Finansowe

UniCredit
Group Profile
Grupy Kapitaowej
Banku Pekao S.A.
Highlights276
Focus278
Business Model
280
The UniCredit Strategic Plan
281
Highlights
UniCredit operates in 22 Countries with
more than 160,000 employees and nearly
9,500 branches.
UniCredit benefits from a strong European
identity, extensive international presence
and broad customer base.
Its strategic position in Western and
Eastern Europe gives the Group one
of the regions highest market shares.
Employees1
over 160,000
Branches2
nearly 9,500
1. Data as at December 31, 2011. FTE = Full Time Equivalent: number of employees
counted for the rate of presence. Figures include all employees of subsidiaries consolidated
proportionately, such as Ko Financial Services Group employees.
2. Figures include all branches of subsidiaries consolidated proportionately, such as
Ko Financial Services Group branches.
UniCredit
operates in
following
countries
AUSTRIA
AZERBAIJAN
BOSNIA AND HERZEGOVINA
BULGARIA
CROATIA
CZECH REPUBLIC
ESTONIA
GERMANY
HUNGARY
ITALY
KAZAKHSTAN
KYRGYZSTAN
LATVIA
LITHUANIA
POLAND
ROMANIA
RUSSIA
SERBIA
SLOVAKIA
SLOVENIA
TURKEY
UKRAINE
EMPLOYEES BY COUNTRY1 (%)
BRANCHES BY COUNTRY2
4,400
Italy
Germany
Austria
850
Italy
Germany
1,002
Turkey
953
Total
32.5
310
Poland
Others
25.1
Austria
10.5
Poland
12.3
1,980
6.3
13.3
Turkey
Others
9,496
Focus
Austria, Germany and Italy
UniCredit is strategically positioned in Italy, Germany

and Austria. These three countries account for more
than one-third of the combined GDP of the European
Union and collectively represent one of the continents
wealthiest transnational regions.
GDP per capita in each of these countries is higher than
the average for the EU as a whole. Moreover, Germany
ranks first in terms of GDP per capita among the four
largest EU economies, surpassing France, the United
Kingdom and Italy.
UniCredit has one of the largest banking networks in
all three of these core Western European countries
and provides access to 310 branches in Austria, 850 in
Germany and 4,400 in Italy. Each country is closely linked
to the growing economies of Central and Eastern Europe.
In terms of economic performance, 2011 was another
year of moderate expansion for these core countries.
The first half of the year saw a growth in momentum
that was sustained by healthy global demand. During the
second half of the year, there was a marked slowdown
in economic activity following the sovereign debt crisis,
which took place during the summer. In particular,
market repricing of risk premiums on Italys sovereign
debt took its toll, fueled by investor concerns about the
sustainability of the countrys public debt in the context
of structurally low GDP growth. The response of the
Italian government in terms of fiscal consolidation was
impressive, although this likely contributed to dampen
the countrys growth prospects, at least in the short-term.
As for Germany, market sentiment remained extremely
positive with regard to the countrys perceived health.
GDP PER CAPITA1
MARKET SHARE2 (%)

139.6
Austria
Germany
Italy
124.2
105.2
15.1
Austria
Germany
2.6
Italy
13.8
1. Nominal GDP per capita as at December 31, 2010 (EU27=100). Estimate of Nominal GDP
per capita within the EU27 as at December 31, 2010
2. Market Share in terms of Total Customer Loans as at December 31, 2011.
Source: Eurostat, UniCredit Research.
For the next two years, our three core markets will face
challenges. These will be particularly acute in Italy.
Nevertheless, these three countries will continue to
demonstrate their relative strength in comparison to
the nations of southern Europe given their balanced
growth model, relatively low level of private sector debt
and continued prudent management of public finances.
Italy and Germany possess the eurozones largest
manufacturing base, together generating more than
50 percent of the euro areas total nominal added
value.
From 2011 to 2015, real economic growth is expected
to continue at an average annual rate of roughly
2 percent in Austria and Germany, and nearly
0.5 percent in Italy. This is higher than the average
rate achieved over the previous five-year period for
the three countries. Moreover, while exports will
certainly be an important factor behind the ongoing
economic recovery, another favorable development
will be seen in domestic demand, which will become
an increasingly important engine of economic
development. Particularly in Germany, this will result
in a more sustainable pattern of growth that is not
exclusively export-driven.
Central and Eastern Europe

UniCredit is a market leader in
Central and Eastern Europe, where
it has a broad network of roughly
3,900 branches.
Its regional footprint is diverse, and
includes a direct presence in 19
countries. It is ranked in the top five
in 11 of these countries*. In fact, the
CEE now accounts for 18 percent of
the Groups revenues.
UniCredit has a long history in this
dynamic region, from which nearly
half of all its employees come.
The Group is well positioned to
benefit from the process of economic convergence
that has been generating higher living standards and
a better business environment in these countries.
UniCredits market position in this region gives its local
banks a substantial competitive advantage. This includes
the sharing of best practices, significant economies of
scale, access to international markets and strong brand
recognition. Moreover, the banks diversified portfolio in
this region enables modular growth and increased market
penetration for UniCredits global product lines.
In the first three quarters of 2011, most countries in
the region posted strong gains in economic activity,
supported by robust external demand, favorable
agricultural conditions and, in some cases, resilient
domestic demand growth. To date, available data
indicates some slowdown in economic activity in the
fourth quarter, in part as a result of weaker external and
industrial demand. Nevertheless, the region as a whole
proved relatively resilient to the challenges of the EMU.
The risks, if any, to UniCredit prediction of 4.7 percent
GDP growth for the CEE in 2011** are to the upside.
In 2012, GDP growth for the region is forecast at 3.3
percent, assuming a broadly flat first half-year followed
by an improved second half-year. Among the largest
economies in the region, Russia is expected to lead,
posting growth of almost 4 percent, while in Turkey
and Poland GDP should post gains of approximately
3 percent. These economies will benefit from

lower debt levels as well as a head start in fiscal
consolidation relative to the EMU. Other economies in
the region, including Croatia, Slovenia and Hungary, will
struggle to post positive gains in GDP.
MARKET SHARE3 (%)
Latvia
1.4
Lithuania
1.4
Estonia
1.6
Russia
2.2
Ukraine
Hungary
4.4
5.6
Slovenia
6.0
Czech Republic*
6.1
Romania*
6.1
Serbia*
6.9
Slovakia
6.9
Kazakhstan
Turkey
7.7
9.3
Poland
11.3
Bulgaria
15.5
Bosnia and
Herzegovina
Croatia
21.4
25.7
* as at September, 2011.
**GDP figures at December, 31 2011 are not yet final.
3. M
arket Share in terms of Total Assets as at December 31, 2011.
Market Share in Azerbaijan and Kyrgyzstan not available.
4. Pro-forma (Ukrsotsbank + UniCredit Bank Ukraine).
Source: UniCredit Research, UniCredit CEE Strategic Analysis.
Business Model
This model focuses on four pillars:
Customer-centricity
A multi-local approach
This is the focus of the Business Divisions

Families & Small-Medium sized Enterprises,
Corporate & Investment Banking, Private
Banking and Central Eastern Europe.
With their highly specialized
services, they offer clear and
simple solutions to all customer
segments, thereby maximizing
long-term value and generating customer
satisfaction.
UniCredit combines an international

distribution network with deep local roots and
close ties to its customers by leveraging the
global product lines, like Leasing and Factoring,
its global service lines and the local expertise
of UniCredits people operating in the local
markets.
Global product lines
Global service lines
Each of the product lines is responsible for the

centralized development of a complete portfolio
of financial products and services suitable to the
diverse needs of its customers. These product
lines generate added value for customer segments
in all countries and regions by leveraging also the
specialized skills and knowledge of the Groups
Banks/Companies (e.g Fineco Bank).
UniCredits service lines provide a broad

range of specialized internal
services such as information
technologies, back-office
activities, personnel administrative
management, loan recovery, purchasing
and the real estate management.
Organizational structure
UniCredits organization reflects its divisional business model
and geographic scope.
To meet customers needs, UniCredit is divided into
specialized Business Divisions, as follows:
Three divisions Families & Small-Medium sized
Enterprises, Corporate & Investment Banking, Private
Banking manage the activities intended for their
respective customer segments. These include marketing,
defining service models and developing products, as well as
overseeing and coordinating some specific businesses.
The CEE Division serves to align the activities in 19
countries of Central and Eastern Europe to a single,
comprehensive business vision.
In line with the multi-local approach, responsibility for

individual countries is lodged with leadership roles such as
the Country Chairman in the four main markets of Austria,
Germany, Italy and Poland and the Country CEO in the six
divisionalized CEE countries. Their task is to combine the
Groups strategic business vision with that of their country.
Lastly, the functions called Competence Lines oversee the
guidance, coordination and control of UniCredits
activities and manage the related risks. These competence
lines include Planning, Finance & Administration, Risk
Management, Legal & Compliance, Internal Audit, Human
Resources, Organization and Identity & Communications.
The UniCredit Strategic Plan

Clear goals, specific actions and a long-term vision are key elements of the UniCredit
Strategic Plan that will be implemented through 2015. The strategic targets of the plan
are related to commercial activity which meets real needs with concrete solutions, capital
strength, operating efficiency, profitability and focus on Europe.
Commercial activity. Placing a renewed emphasis on the
importance of being a commercial bank will put UniCredit
at the center of the real economy. Customers primarily look
to UniCredit to provide them with savings and loan services.
Most importantly, the Groups return to traditional banking
fundamentals means that it can provide tailored solutions to
fit these needs.
Capital strength. UniCredits position as one of the 29
global systematically important financial institutions (G-SIFIs)
is official recognition that it is now one of the most secure
banks in the world. However, it remains a priority to further
improve its capital and liquidity positions, as well as its
access to funding.
Operating efficiency. To be truly competitive in the years
to come, UniCredit requires a simplified operating structure
that is more customer-focused, efficient, cost-conscious and
streamlined in terms of central functions.
Profitability. Profits must be sustainable. And only a strong,
low-risk traditional business model can generate sustainable
profits and a return on capital that is greater than its costs.
with regard to the subjects of capital endowment and risk

profile. UniCredits successful 7.5 billion capital increase
was the first step towards strengthening its position, and,
in 2012, it gave the bank a Common Equity Tier 1 Ratio of
over 9 percent based on Basel 3 criteria. UniCredits goal
is to exceed 10 percent by 2015. As for the reduction of
its risk profile, this will require the sale of 48 billion in
non-strategic assets and greater selectivity in lending as
compared to the past. These transactions will allow UniCredit
to focus more on its traditional banking business by raising
funds and providing loans on an ongoing basis and under
attractive conditions.
Cost controls and simplification. UniCredit aims to be
efficient, streamlined, fast and unified. To achieve this as
quickly as possible and starting in 2012, the strategic plan
calls for difficult decisions requiring it to break with the
past. UniCredits organizational model and several other
components will change according to customer needs and
will involve a downsizing of support functions plus a
shift to centralized departments. At the same time, spending
will be thoroughly reviewed to achieve overall savings of
440 million.
Focus on Europe. UniCredits current orientation is towards

Europe. Its geographic diversity is an unquestionable asset
that will continue to serve the Group well into the future.
In fact, its strong presence in Western Europe and in those
CEE countries with high growth potential will strengthen
UniCredits relationships with strategic customers
internationally.
Business shift for CEE and CIB. Both of these business

areas will be reviewed. On one hand, this will involve
leveraging countries with the greatest growth potential
especially those where UniCredit is well-positioned in terms
of risk/return (the Czech Republic, Poland, Russia and Turkey).
On the other hand, it will involve a shift in lending to focus
on more strategic customers in order to create additional
loans.
The steps set forth in the UniCredit Strategic Plan to achieve

these goals can be broken down into four areas of activity:
use of capital; cost control and simplification; a business shift
for CEE and CIB; and a resurgence in Italy.
Resurgence in Italy. While Italy is number one for UniCredit

in terms of revenues and loans, the countrys profitability
must improve. To do this, UniCredit will adjust the risk profile
of its loan portfolio to favor higher credit ratings, reduce the
efficiency gap with its main competitors and to be more
selective in its lending. These steps will allow UniCredit to
provide new medium- and long-term credit lines totaling
33 billion to SMEs, and to extend new loans to households
totaling more than 39 billion.
Use of capital. This must be carefully addressed. Being a

G-SIFI bank may mean that UniCredit is one of the
29 most secure banks in the world, but it also means it is
one of the most regulated institutions. This is especially true
Making Made in Italy

an international success
Many Italian SMEs have expressed interest in participating in a series of workshops on

internationalization. The Export Business School is a programme UniCredit developed to reinforce the
competitiveness of companies in the international arena by means of in-depth coursework and creation
of networking opportunities. In conjunction with this initiative, the bank also created the East Gate
Export programme to promote the activities of Italian companies in Eastern Europe. And moving further
eastward, a UniCredit project to promote Italian SMEs in China has drawn praise from entrepreneurs
and managers from among a wide cross-section of Italian companies.
Destinazione Cina 2011 project - October 26, 2011, Magnani Palace, Bologna
Creating initiatives
that meet real needs
Together for the Region is an initiative designed to build tighter bonds with regions and communities,
particularly with locally based non-profit organizations. For example, in Nuremberg, UniCredit created
a new debit card, My Town - My Bank - My Card. Part of card proceeds are donated to Lebenshilfe
Nrnberg, a charitable organization that helps the disabled. The same model has been adopted by
more than 50 UniCredit subsidiaries in Germany. Parallel to the donation, the Banks local staff has
created a corporate volunteer programme, with employees participating in activities that range from
providing volunteer companion services to offering professional training. The project received positive
local press attention, demonstrating how simple, concrete actions can serve real needs. This is the
practical demonstration of how the Group is giving concrete answers to facilitate full integration of
persons with disabilities.
Bank Polska Kasa Opieki S.A.

53/57 Grzybowska St.
00-950 Warsaw
PO Box 1008
Tel. (48 22) 656 00 00
Fax (48 22) 656 00 04
SWIFT: PKOPPLPW
Infoline: 0 801 365 365
www.pekao.com.pl
e-mail: info@pekao.com.pl

Pekao Bank Annual Report 2011

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Meeting real needs

with concrete solutions

2011 Annual Report

Annual Report 2011

Supervisory Board and Management Board of Bank Pekao S.A.

Chairwomans Message to the Shareholders

CEOs Letter to theShareholders

External Business Environment 

Important Events and Achievements

Information for Investors

Activities of the Bank Pekao S.A. Group 

Statement of Financial Position and Financial Results

Corporate Social Responsibility

Prospects for Development

Statement of Bank Polska Kasa Opieki Spka Akcyjna

Representations of the Banks Management Board

Consolidated Financial Statements of Bank Pekao S.A. Group

UniCredit Group Profile

Bank Pekao S.A. Annual Report 2011

INCOME STATEMENT (PLN MILLION) SELECTED ITEMS

Return on average equity (ROE)

STATEMENT OF FINANCIAL POSITION (PLN MILLION) SELECTED ITEMS

STATEMENT OF FINANCIAL POSITION STRUCTURE RATIOS

Net loans/total assets

Total number of employees*****

Annual Report 2011 Bank Pekao S.A.

Supervisory Board and

Bank Pekao S.A. Annual Report 2011

The 2011 performance

Another noteworthy achievement was theeffective

In theopinion of theSupervisory Board, Bank Pekao S.A.

The 2011 performance attests to theBanks strong position

The 2011 performance of theBank and theBank Pekao S.A.

As in thepast, theBanks activities in 2011 were appreciated

Annual Report 2011 Bank Pekao S.A.

theManagement Boards view that themost important

implementation of arisk management strategy, together

Bank Pekao S.A. Annual Report 2011

We are very well

Annual Report 2011 Bank Pekao S.A.

The financial condition of the majority of households and

We reinforced our leading position in corporate banking,

We managed to deliver all this while keeping strict cost

In pursuance of our CSR mission we also engage in charitable

Bank Pekao S.A. Annual Report 2011

Bank Pekao S.A. Annual Report 2011

Annual Report 2011 Bank Pekao S.A.

As at the end of December 2011, total amounts due to the Groups

External Business Environment

Inflation and Monetary Policy 

Bank Pekao S.A. Annual Report 2011

External Business Environment

The unemployment rate slightly increased from the 12.4% reported as at

The falling employment rate was accompanied by adecline in the number

Employment in the corporate sector (%, YoY, LA)

Retail Sales (%, yoy)

Unemployment rate (%, RA)

Wage bill (%, yoy)

Annual Report 2011 Bank Pekao S.A.

Inflation and Monetary Policy

Bank Pekao S.A. Annual Report 2011

External Business Environment (cont.)

According to initial estimates by the National Bank of Poland, in 2011

C/A balance (EUR m, LA)

Supervisory Board and Management Board of Bank Pekao S.A.

Chairwomans Message to the Shareholders

CEOs Letter to theShareholders

External Business Environment

Important Events and Achievements

Information for Investors

Activities of the Bank Pekao S.A. Group

Statement of Financial Position and Financial Results

Corporate Social Responsibility

Prospects for Development

Representations of the Banks Management Board

UniCredit Group Profile

Inflation and Monetary Policy

Changes within the Group

Awards and Distinctions