BPKD.L Regulatory News (BPKD)

30 Apr 2007 07:00

Bank Pekao SA27 April 2007 UNOFFICIAL TRANSLATION Report 71/2007: Resolutions adopted by the Ordinary General Meeting of BankPolska Kasa Opieki S.A. on 26th April 2007 The Management Board of Bank Polska Kasa Opieki S.A. presents the resolutionsadopted by to the Ordinary General Meeting of the Bank on 26th April 2007: Resolution No. 1 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjnaon election of Chairman of the Ordinary General Meeting The Ordinary General Meeting appoints Mr. Andrzej Leganowicz as Chairman oftoday's Meeting. Resolution No. 2 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjnaon election of the Ballot Counting Commission The Ordinary General Meeting appoints the following members of the BallotCounting Commission: 1. Mrs. Ewa Rucinska, 2. Mrs. Lucyna Haczewska, 3. Mr. Tomasz Dubiel. Resolution No. 3 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjnaon adoption of the agenda The Ordinary General Meeting adopts the agenda in the wording published inJudicial and Economic Journal No. 67 (2664) on 4th April 2007. Resolution No. 4 of the Ordinary General Meetingof Bank Polska Kasa Opieki Spolka Akcyjnaon approving report of the Management Boardon the activity of Bank Polska Kasa Opieki S.A. in 2006 Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.1 of Code of theCommercial Companies and pursuant to Par. 13 p.1 of the Bank's Statute, theOrdinary General Meeting resolved as follows: Par. 1. The report of the Management Board on the activity of Bank Polska KasaOpieki S.A. for 2006 is hereby approved. Par. 2. The Resolution is enacted upon its adoption. Shareholder Mr. Michel Marbot, Mr. Marcin Namaczynski, the plenipotentiaryof Shareholder Dariusz Baran, and Shareholder Mr. Jerzy Bielewicz stated thatthey made objections to the above-mentioned resolution. Resolution No. 5 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the financial report of Bank Polska Kasa Opieki S.A. for 2006 Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.1 of Code of theCommercial Companies and Par. 13 p.1 of the Bank's Statute, the Ordinary GeneralMeeting resolved as follows: Par. 1. The financial report of Bank Polska Kasa Opieki S.A. for 2006 is herebyapproved, with the following figures: a) the balance sheet as at 31st December 2006 showing on the assets andliabilities side the total of PLN 66,976,754,570.23 (say: sixty six billion ninehundred seventy six million seven hundred fifty four thousand five hundredseventy 23/100 PLN), b) the profit and loss account for the financial year from 1st Januaryuntil 31st December 2006 showing a net profit of 1,728,538,988.65 PLN (say: onebillion seven hundred twenty eight million five hundred thirty eight thousandnine hundred eighty eight 65/100 PLN), c) the cash flow statement for the financial year from 1st January until31st December 2006 with a net cash inflow by 2 888 831 thousand PLN (say: twobillion eight hundred eighty eight million eight hundred thirty one thousandPLN), d) the statement of changes in equity for the period from 1st January until31st December 2006 with an increase in equity amounting to 423 907 thousand PLN(say: four hundred twenty three million nine hundred seven thousand PLN), e) explanatory notes to the financial report. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, andShareholder Mr. Jerzy Bielewicz stated that they made objections to theabove-mentioned resolution. Resolution No. 6 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving report of the Management Board on the activity of Bank Polska Kasa Opieki S.A. Capital Group in 2006 Acting in accordance with Art. 395 Par. 5 of Code of the Commercial Companiesand Par. 13 point 5 of the Bank's Statute, the Ordinary General Meeting resolvedas follows: Par. 1. The report of the Management Board on the activity of Bank Polska KasaOpieki S.A. Capital Group for 2006 is hereby approved. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran,Shareholder Mr. Michel Marbot and Shareholder Mr. Jerzy Bielewicz stated thatthey made objections to the above-mentioned resolution. Resolution No. 7 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the consolidated financial report of Bank Polska Kasa Opieki S.A. Capital Group for 2006 Acting in accordance with Art. 395 Par. 5 of Code of the Commercial CompaniesandPar. 13 point 5 of the Bank's Statute, the Ordinary General Meeting resolved asfollows: Par. 1. The consolidated financial report of Bank Polska Kasa Opieki S.A.Capital Group for 2006 is hereby approved, with the following figures: a) the consolidated balance sheet as at 31st December 2006 showing on theassets and liabilities side the total of PLN 67,703,688,079.58 (say: sixty sevenbillion seven hundred three million six hundred eighty eight thousand seventynine 58/100 PLN), b) the consolidated profit and loss account for the financial year from1st January until 31st December 2006 showing a net profit of 1,789,696,554.40PLN (say: one billion seven hundred eighty nine million six hundred ninety sixthousand five hundred fifty four 40/100 PLN), c) the consolidated cash flow statement for the financial year from 1stJanuary until 31st December 2006 with a net cash inflow by 2 966 116 thousandPLN (say: two billion nine hundred sixty six million one hundred sixteenthousand PLN), d) the consolidated statement of changes in equity for the period from 1stJanuary until 31st December 2006 with an increase in equity amounting to 469 901thousand PLN (say: four hundred sixty nine million nine hundred one thousandPLN), e) explanatory notes to the consolidated financial report. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran,Shareholder Mr. Michel Marbot and Shareholder Mr. Jerzy Bielewicz stated thatthey made objections to the above-mentioned resolution. Resolution No. 8 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on the distribution of net profit of Bank Polska Kasa Opieki S.A. for 2006 Acting in accordance with Art. 395 Par. 2 point 2 of Code of the CommercialCompanies and Par. 13 point 2 of the Bank's Statute, the Ordinary GeneralMeeting taking into account: a) the amount of the current and projected levels of the kinds of risk ofthe conducted activity resulting from the capital requirements, b) current level of the core capital (6 309,2 million PLN) and capitaladequacy ratio (14,74%) guaranteeing the stable and safe functioning of theBank, c) the conducted by the Bank policy of increase nominal value per share(according to the Management Board's motion the amount of dividend per sharei.e. 9,00 PLN is higher by 21,6% than the amount paid for 2005), d) the positive opinion of the Supervisory Board on the Management Board'smotion on the distribution of the net profit of the Bank for 2006, resolved as follows: Par. 1. The net profit of Bank Polska Kasa Opieki S.A. for 2006 in the amount of1,728,538,988.65 PLN (say: one billion seven hundred twenty eight million fivehundred thirty eight thousand nine hundred eighty eight 65/100 PLN) isdistributed in such way that: a) 1,503,927,882.00 PLN (say: one billion five hundred three million ninehundred twenty seven thousand eight hundred eighty two PLN) is allocated todividend i.e. 9,00 PLN for one share of the Bank, b) 109,611,106.65 PLN (say: one hundred nine million six hundred eleventhousand one hundred six 65/100 PLN) is allocated to the reserve equities, c) 15,000,000.00 PLN (say: fifty million PLN) is allocated to theobligatory reserve equity, d) 100,000,000.00 PLN (say: one hundred million PLN) is allocated to thegeneral risk fund for unidentified banking risk. Par. 2. The date of determining the right to dividend is set on 16th May 2007. Par. 3. The date of paying out the dividend is set on 1st June 2007. Par. 4. The Resolution is enacted upon its adoption. Justification of the resolution of the Ordinary General Meeting of Bank PolskaKasa Opieki Spolka Akcyjna on the distribution of net profit of Bank Polska Kasa Opieki S.A. for 2006 Presenting the motion regarding the 2006 net profit distribution, the ManagementBoard has took into account the following factors: a) the amount of the current and projected levels of the kinds of risk ofthe conducted activity resulting from the capital requirements, b) current level of the core capital (6 309,2 million PLN) and capitaladequacy ratio (14,74%) guaranteeing the stable and safe functioning of theBank, c) the conducted by the Bank policy of increase nominal value per share(the amount of dividend per share i.e. 9,00 PLN is higher by 21,6% than theamount paid for 2005), Approximately 87% of the net profit of the Bank (approximately 84% of the netprofit of the Group) for the year 2006 will be assigned for the dividend. TheManagement Board proposes to earmark the net profit amount remaining afterdistribution for dividend, i.e. 224,611,106.65 PLN for: reserve equities109,611,106.65 PLN, for obligatory reserve equity 15,000,000.00 PLN and100,000,000.00 PLN for general risk fund for unidentified banking risk. Due to expanding Bank's business activity with brokerage activity, the Bank isobliged to create the fund for conducting a brokerage activity. The amount of15,000,000.00 PLN will be transferred from the obligatory reserve equity to thefund for conducting a brokerage activity after the changes in the Bank's Statuteenacted by the Extraordinary General Meeting have been registered. The Supervisory Board gave the positive opinion on the motion of the ManagementBoard on the distribution of net profit of Bank Polska Kasa Opieki S.A. for2006. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran,Shareholder Mr. Michel Marbot and Shareholder Mr. Jerzy Bielewicz stated thatthey made objections to the above-mentioned resolution. Resolution No. 9 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the report on the activity of the Supervisory Board of Bank Polska Kasa Opieki S.A. in 2006 Acting in accordance with to Par. 13 p. 3 of the Bank's Statute, the OrdinaryGeneral Meeting resolved as follows: Par. 1. The report of the Supervisory Board of Bank Pekao S.A. on its activitiesin 2006 and results of review of the reports on activity of the Bank and theCapital Group in 2006, the Bank's and the Capital Group financial statements for2006 as well as the Management Board's motion on net profit distribution for2006 is hereby approved. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Report of the Supervisory Board of Bank Polska Kasa Opieki S.A. on itsactivities in 2006, the results of review of the reports on activity of the Bankand the Capital Group in 2006, the Bank's and the Capital Group's financialstatements for 2006 and the Management Board's motion on net profit distributionfor 2006. I. Composition and organisation of work of the Supervisory Board in 2006 In 2006 the Supervisory Board was composed of the following persons: Jerzy Woznicki - Chairman, Paolo Fiorentino - Deputy Chairman, Secretary of the Board, Andrea Moneta - Deputy Chairman, Members: Pawel Dangel, Fausto Galmarini, Oliver Greene, Enrico Pavoni, Leszek Pawlowicz, Jerzy Starak. In accordance with Par. 15 sect. 2 p. 1 of the Bank's Statute, the mandates ofMembers of the Supervisory Board expired as of 4 May 2006, i.e. as of the daywhen the Ordinary General Meeting of Bank Pekao S.A. was held approving thefinancial statements covering the last reporting year during which the functionof member of the Supervisory Board was performed. As a result, the OrdinaryGeneral Meeting appointed Members of the Supervisory Board for the new commonterm of office lasting three years and starting as of 5 May 2006 electing thehitherto Board Members as Members of the Supervisory Board. At its first meeting during the new term of office, which was held on 5 June2006, the Supervisory Board elected again Mr J.Woznicki as Chairman of theBoard, Mr P.Fiorentino, as Deputy Chairman, Secretary of the Board and MrA.Moneta as Deputy Chairman of the Board. The Supervisory Board exercised a permanent supervision of the Bank's activityin accordance with authorisations and duties provided for in the Code ofCommercial Companies and in the Bank's Statute. In 2006, the Supervisory Board held 9 meetings, considered 88 pieces ofinformation, analyses, motions and it adopted 57 resolutions. The Board performed its tasks both at the meetings and through its members inteams set up for handling specific problems. In 2006 the following teams of the Supervisory Board continued their activity:(i) audit team, (ii) remuneration team, and (iii) financial team. II. The activity of the Supervisory Board In 2006 the activity of the Supervisory Board focused both on strategic issuesconnected with accomplishing the objectives defined in the strategic plan ofBank Pekao S.A. and the Pekao S.A. Group for the years 2005-2007 and determinedin the financial plan for 2006, as well as on issues pertaining to supervisionof the current operation of the Bank. The Board analysed on regular basis: financial standing, sale results in thearea of products that were of key significance to the growth of the Bank'sresults, i.e. mortgage loans, consumer loans, mutual funds and bank cards, aswell as quality of assets, level of risk and level of the Bank's security. The Board supervised the process of risks management at the Bank approving theadopted by the Management Board credit risk policy for 2006 as well asinvestment and assets and liabilities management policy at the Bank for 2006.The quarterly reports on financial risk management, credit portfolio and loanworkout activity were analysed with due diligence. Performing its statutory duties, the Board analysed and assessed the motions andreports addressed by the Management Board to the General Meeting. The Board issued opinions on quarterly and semi-annual consolidated financialstatements of the Capital Group of Bank Pekao S.A. prepared in accordance withthe International Financial Reporting Standards. The works on projects being implemented at the Bank were also in the sphere ofinterest of the Board. In particular, the Board analysed the status of works onimplementation of the New Capital Accord at the Bank the main objective of whichwas to improve the process of risk assessment and risk control at the Bank. TheBoard also considered the information on the project of corporate clientsmonitoring. The Board also performed an in-depth analysis of other areas and fields ofactivity of the Bank, including in particular such areas as: (i) position of theBank viewed against the background of the banking sector, (ii) macroeconomicconditions and environment of the Bank, (iii) relations with investors andanalysts, (iv) activity of subsidiary companies and (v) activity of specificteams set up by the Board. The Supervisory Board, with particular due diligence, supervised the process ofintegration with Bank BPH S.A. considering the information on actions taken bythe Steering Committee managing this process and the information on results ofwork of task forces. On 15 November 2006, the Supervisory Board issued a positive opinion on: - intention to integrate Bank Pekao S.A. with Bank BPH S.A. by means ofspin-off of Bank BPH S.A. transferring a part of property of Bank BPH S.A. inthe form of organised part of the enterprise to Bank Pekao S.A. in exchange ofshares of Bank Pekao S.A. which will be taken up by shareholders of Bank BPHS.A. The intention was expressed in the Resolution no. 173/XI/06 of theManagement Board dated 12 November 2006, - the Spin-off Plan of BPH S.A. adopted by Resolution no. 175/XI/06 ofthe Management Board dated 14 November 2006. The Supervisory Board also got acquainted with the methods with the help ofwhich Bank Pekao S.A. and Bank BPH S.A., supported by investment banks, preparedtheir valuation in order to spin-off Bank BPH S.A. Based on those valuations,the Management Boards of both banks established the Share Allocation Ratio as 1to 3,3, which means that for each single share of Bank BPH S.A. a shareholder ofBank BPH S.A. will receive 3 and 3/10 shares of Bank Pekao S.A., retaining theso far shares of Bank BPH S.A. The Supervisory Board acknowledged the information on assessment performed byMerrill Lynch investment bank concerning the Share Allocation Ratio from thestandpoint of its correctness and soundness and confirming that payment for thespin-off was fair to Bank Pekao S.A. from the financial point of view. The Board also supervised the implementation of strategy of the Bank'sdevelopment in Ukraine issuing positive opinions on the motions presented by theManagement Board concerning the increase of statutory capital of UniCredit BankLtd. (former Bank Pekao (Ukraine) Ltd.) and acquisition of shares in Joint StockCommercial Bank HVB Ukraine. These actions are aimed to create a bank in Ukrainerunning the activity in all market segments and to gain a significant positionon the Ukrainian banking market. III. The assessment of reports submitted by the Management Board on activitiesof the Bank and the Capital Group in 2006, the Bank's and the Capital Group'sfinancial statements for 2006 as well as the Management Board's motion regardingnet profit distribution for 2006. Acting pursuant to art 382 Par. 3 of the Code of Commercial Companies, theSupervisory Board of Bank Pekao S.A., fulfilling its statutory duties, assessedthe reports of the Management Board and Capital Group in 2006 and the financialstatements of the Bank and Capital Group for 2006 from the standpoint of theircompliance with books, documents and factual state. Following this assessment, the Board issues a positive opinion on the achievedresults and recommends the General Meeting to adopt resolutions approving thesestatements. Putting forward such a recommendation, the Board took into account the fact thatthe Bank generated the biggest net profit in its history in the amount of 1728,5 mln PLN, i.e. by 20,1% higher than in 2005. The consolidated net profit ofthe Pekao S.A. Group totalled 1 789,7 mln PLN and it was by 16,6% higher thanthe year before. The return on equity (ROE) rose up to 21,0% and theconsolidated ROE went up to 21,1%. The income of the Group in 2006 amounted to4 699,2 mln PLN and it was by 6,5% higher than the year before. This growthstemmed from income generated by fees and commissions, which amounted to 1 899,2mln PLN, and it was by 19,7% higher than in the year 2005, with interest incomehigher by 1,8%. The operating costs were under tight control. The cost/incomeratio in 2006 amounted to 48,3% for the Bank and 50,3% for the Grouprespectively. The Supervisory Board assessed the Management Board's motion regardingdistribution of net profit for 2006. Taking into account: a) an amount of the current and projected levels of the kinds of risk ofthe conducted activity resulting from the capital requirements, b) current levels of the core capital (6 309,2 mln PLN) and capitaladequacy ratio (14,74%) guaranteeing the stable and safe functioning of theBank, c) the conducted by the Bank policy of increase nominal value per share(according to the Management Board's motion the amount of dividend per sharei.e. 9.0 PLN is higher by 21,6 % than the amount paid for 2005), the Supervisory Board decided to recommend to the General Meeting to distributethe net profit in the amount of 1.728.538.988,65 PLN in such way that: - 1,503,927,882.00 PLN is allocated to dividend i.e. 9,0 PLN for oneshare, - 109,611,106.65 PLN is allocated to reserve equities, - 15,000,000.00 PLN is allocated to obligatory reserve equity, - 100,000,000.00 PLN is allocated to the general risk fund forunidentified risk of the bank activity. Assessing the work of the Management Board, the Supervisory Board took intoaccount, among other things: (a) very good financial results, (b) strengthenedsecurity of the Bank, (c) its strong competitive position, (d) increase ofeffectiveness of operating activity, (e) good financial performance ofsubsidiary companies, (f) tight costs control, and (g) effective financial riskmanagement. The Bank has a very strong base to take the full advantage of opportunities ofits further dynamic development. As a result of the process of integration withBank BPH S.A., the Bank will become the biggest bank in Poland in terms ofassets and it will be able to take advantage of effect of scale and synergiesand to strengthen its position as top financial institution on the Polishmarket. The strong capital base allowing for development of commercial activity,effective policy in terms of costs management and the conservative policy ofcredit risk management will strengthen the force of the Bank and they will allowpreserving its leadership market position in the following years. The potentialgenerated by the Bank, strengthened by potential of Bank BPH S.A., and thefavourable market trends will enable to achieve in 2007 a further growth ofincome and the rise of key performance indicators. The Bank intends to achievethose goals by: (i) continuation of active sale of consumer and mortgage loans,(ii) increase of penetration of customer base and acquisition of new clientsfrom the group of small and medium-sized companies, (iii) further increase ofsale of investment funds, (iv) designing a better product offer for affluentclients and clients from the private banking segment, (v) sale of cards, and(vi) taking the full advantage of the potential stemming from development ofcash management banking. In assessment of the Supervisory Board, the potential of the Bank's development,strengthened by integration with Bank BPH S.A., allows to expect very goodcommercial and financial results in the current year and in the future. Given the above, pursuant to art 395 Par. sect. 2 p. 3 of the Code of CommercialCompanies, the Supervisory Board recommends the General Meeting to acknowledgefulfilment of duties in 2006 by members of the Management Board, Messrs JanKrzysztof Bielecki, Luigi Lovaglio, Sabina Olton, Przemyslaw Figarski, IreneGrzybowski, Paolo Iannone, Christopher Kosmider and Marian Wazynski as well asmembers of the Supervisory Board: Jerzy Woznicki, Paolo Fiorentino, AndreaMoneta, Pawel Dangel, Fausto Galmarini, Oliver Greene, Enrico Pavoni, LeszekPawlowicz and Jerzy Starak. Supervisory Board's Assessment of the Standing of Bank Polska Kasa Opieki S.A. in 2006 The Supervisory Board of Bank Polska Kasa Opieki S.A. considers the resultsachieved by the Bank and Pekao S.A. Group in 2006 as very good. The Bankgenerated the biggest net profit in its history in the amount of 1 728,5 mlnPLN, i.e. by 20,1% higher than in 2005; the consolidated net profit of the PekaoS.A. Group totalled 1 789,7 mln PLN, i.e. by 16,6% higher than the year before,the return on equity (ROE) rose up to 21,0% and the consolidated ROE went up to21,1%. The income of the Group in 2006 equalled 4 699,2 mln PLN and it was by6,5% higher than in the previous year. This growth stemmed from income generatedby fees and commissions, which amounted to 1 899,2 mln PLN, and it was by 19,7%higher than in the year 2005, with interest income higher by 1,8%. Good results were achieved in sale of the key products: consumer loans, mortgageloans denominated in PLN, investment funds and credit cards. The sale of"Express Loan" in 2006 was by 22,5% higher than in the previous year. The saleof mortgage loans denominated in Polish currency rose by 57,1%, whichcontributed to increase of volume of these loans by 47,8%. The value of assetsof mutual funds increased by 20,9% and the number of credit cards rose by 67,2%as compared to the end of 2005. The Group gross loan portfolio rose by 9,8% dueto good sale results of "Express Loan", mortgage loans in PLN and loans formicro and small-sized enterprises as well as a result of growth in volume ofcorporate loans. At the same time, the quality of loan portfolio of the Groupimproved: the share of classified loans fell from 15,5% at the end of 2005 downto 11,8% in December 2006. Good results of the Bank were accompanied by goodfinancial performance of subsidiary companies. The operating costs remained under tight control. The cost/income ratio in 2006totalled respectively: 48,3% for the Bank and 50,3% for the Group. In the opinion of the Supervisory Board, the economic and financial standing ofBank Polska Kasa Opieki S.A. is good and no threat is posed to safety of fundsdeposited by clients on bank accounts. The Bank meets all the requirementsconcerning operational safety and the requirements pertaining to capitaladequacy. The good systems of managing the particular types of risk and theefficient internal audit provide support to effective Bank management. The Boardsupervises the risks management process by considering the reports submitted onregular basis by the Management Board. The credit risk policy is assessed asprudent and the credit process is aimed at limitation of risk and increase ofsecurity. The Bank's actions in this respect are assessed positively. The good results and position of the Bank are recognized by the market. Thisreflects in a high price of the Bank's shares, high assessment of the Bank'sfinancial credibility in agency ratings as well as positive evaluation on thepart of investors and analysts who perceive the Bank as the investment of highquality. The important premise for assessment of prospects for development and futureposition of Bank Pekao S.A. is the process of integration with Bank BPH S.A. bymeans of spin-off of Bank BPH S.A. by transferring a part of property of BankBPH S.A., in the form of organised part of the enterprise, to Bank Pekao S.A. inexchange for shares of Bank Pekao S.A. which will be taken up by shareholders ofBank BPH S.A. As a result of this process, Bank Pekao S.A. will become the biggest bank inPoland in terms of assets. The Bank will be able to take advantage of theeffects of scale and synergy and to strengthen its position as top financialinstitution on the Polish market. The strong capital base allowing fordevelopment of commercial activity, effective costs management policy andconservative policy in terms of credit risk management - will strengthen theBank and will allow to preserve its leadership market position in the followingyears. The Bank has a very strong base to take the full advantage of opportunities ofits further dynamic development. The potential generated by the Bank,strengthened by potential of Bank BPH S.A., and the favourable market trendswill enable to achieve in 2007 a further growth of income and the rise of keyperformance indicators. The Bank intends to achieve those goals by: (i)continuation of active sale of consumer and mortgage loans, (ii) increase ofpenetration of customer base and acquisition of new clients from the group ofsmall and medium-sized companies, (iii) further increase of sale of investmentfunds, (iv) enrichment of product offer for affluent clients and clients fromthe private banking segment, (v) sale of cards, and (vi) taking full advantageof potential stemming from development of cash management banking. Summing up, the Supervisory Board assesses the position of the Bank as verygood. This assessment is justified by: (a) very good financial results, (b)strengthened safety of the Bank, (c) strong competitive position of the Bank,(d) increase of effectiveness of operational activity, (e) good financialperformance of subsidiary companies, (f) tight costs control and (g) effectivefinancial risk management. In the assessment of the Supervisory Board, the potential of the Bank'sdevelopment, strengthened by integration with Bank BPH S.A., allows to expectvery good commercial and financial results in the current year and in the future. Resolution No. 10 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties by Members of the Supervisory Board ofBank Polska Kasa Opieki S.A. in 2006 Acting in accordance with Art. 393 p. 1 and Art. 395 Par. 2 p. 3 of Code of theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theOrdinary General Meeting resolved as follows: Par. 1. The following Members of the Supervisory Board hereby receive approval of theirduties performed in the period from 1st January till 31st December 2006: - Jerzy Woznicki - Chairman of the Supervisory Board, - Paolo Fiorentino - Deputy Chairman, Secretary of the Supervisory Board, - Andrea Moneta - Deputy Chairman of the Supervisory Board - Pawel Dangel, Fausto Galmarini, Oliver Greene, Enrico Pavoni, LeszekPawlowicz and Jerzy Starak - Members of the Supervisory Board. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder DariuszBaran, stated that he made objection to the above-mentioned resolution becausein his opinion this resolution infringes upon the Company's interest and it iscontradictory to good customs and is detrimental to interests of minorityshareholders. Shareholder Mr. Jerzy Bielewicz stated that he made objection to theabove-mentioned resolution. Resolution No. 11 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Mr. Jan Krzysztof Bielecki - President of the Management Board, CEO - herebyreceives approval of his duties performed in the period from 1st January till31st December 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Resolution No. 12 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A. Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Mr. Luigi Lovaglio - Vice President of the Management Board, COO - herebyreceives approval of his duties performed in the period from 1st January till31st December 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Resolution No. 13 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A. Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Mrs.Sabina Olton - Vice President, Chief Accountant of the Bank hereby receivesapproval of her duties performed in the period from 1st January till 31stDecember 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Resolution No. 14 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A. Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Member of the Management Board - Mr.Przemyslaw Figarski hereby receives approvalof his duties performed in the period from 1st January till 31st December 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Resolution No. 15 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A. Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Member of the Management Board - Mrs. Irene Grzybowski hereby receives approvalof her duties performed in the period from 1st January till 31st December 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, andMr. Mariusz Holak the plenipotentiary of Shareholder Michel Marbot stated thatthey made objections to the above-mentioned resolution. Resolution No. 16 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A. . Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Member of the Management Board - Mr. Paolo Iannone hereby receives approval ofhis duties performed in the period from 1st January till 31st December 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Resolution No. 17 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A. Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Member of the Management Board - Mr. Christopher Kosmider hereby receivesapproval of his duties performed in the period from 1st January till 31stDecember 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Resolution No. 18 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on approving the performance of duties in 2006 by the Member of the Management Board of Bank Polska Kasa Opieki S.A. Acting in accordance with Art. 393 p.1 and Art. 395 Par. 2 p.3 of Code theCommercial Companies and pursuant to Par. 13 p. 4 of the Bank's Statute, theGeneral Meeting resolved as follows: Par. 1. Member of the Management Board - Mr. Marian Wazynski hereby receives approval ofhis duties performed in the period from 1st January till 31st December 2006. Par. 2. The Resolution is enacted upon its adoption. Mr. Marcin Namaczynski, the plenipotentiary of Shareholder Dariusz Baran, Mr.Mariusz Holak the plenipotentiary of Shareholder Michel Marbot and ShareholderMr. Jerzy Bielewicz stated that they made objections to the above-mentionedresolution. Resolution No. 19 of the Ordinary General Meeting of Bank Polska Kasa Opieki Spolka Akcyjna on appointing the auditor of Bank Polska Kasa Opieki S.A. for 2007 - 2009 Pursuant to Par. 13 p.17 of the Bank's Statute, the Ordinary General Meetingresolves as follows: Par. 1. The General Meeting appoints KPMG Audyt Sp. z o.o. as the auditor of Bank PekaoS.A. for audit and review of the financial statements of Bank Pekao S.A. andconsolidated financial statements of Bank Pekao S.A. Capital Group for 2007,2008 and 2009. Par. 2. The Management Board is hereby authorised to establish all terms and conditionsof the agreement with KPMG Audyt Sp. z o.o. concerning audit and review of thestatements mentioned in Par. 1. Par. 3. The resolution is enacted upon its adoption. Justification of the resolutions of the Ordinary General Meeting of Bank PolskaKasa Opieki Spolka Akcyjna on appointing the auditor of Bank Pekao S.A. for2007-2009. The agreement with KPMG Audyt Sp. z o.o., the present auditor of the Bank,covered the years 2005-2006 and expires upon submitting of the opinion and thereport on the examination of financial statements of the Bank and the Group for2006. The Management Board recommends the extension of the agreement with KPMG AudytSp. z o.o. for the years 2007-2009. The "Good Practices in Public Companies"adopted by the Bank for application and the Resolution no. KNB/20/06 of theBanking Supervision Commission dated 5 April 2006 recommend to enter intoagreement with one entity conducting the examination of the financial statementsfor the period no longer than 5 years. Extension of the agreement with KPMGAudyt Sp. z o.o. - so far concluded for 2 years - for the period of next 3 yearscomplies with the principles adopted by the Bank for application. The Supervisory Board recommended to the Ordinary General Meeting to adopt theresolution on appointing KPMG Audyt Sp. z o.o. as the auditor of Bank Pekao S.A. The Management Board informs that Ordinary General Meeting of Bank Polska KasaOpieki S.A. on 26th April 2007 considered all points covered by the agenda ofthe Meeting. Legal base: Par. 39 sect. 1 p. 5 and p. 7 of the Ordinance of the Minister of Finance, dated19 October 2005 re: current and periodical information submitted by the issuersof securities This information is provided by RNS The company news service from the London Stock Exchange